INCREASING THE ROLE OF THE PRIVATE SECTOR IN COMMUTER BUS SERVICE PROVISION

With increasing fiscal problems facing us, public transport attention has turned to the possibility of developing privately provided bus services in the urban commuter transportation market. Compared with public transit agencies, research has shown that such private companies have relatively lower labour costs and more scheduling flexibility. As labour costs account for the largest proportion of service operating costs so private companies are at an advantage. The critical issue discussed is not whether private operators can provide services at a lower cost, but rather whether such services are economically viable without subsidies and also, if subsidies are necessary, are transit agencies and private companies willing to provide joint services. The article concludes with an assessment of the problems and the potential of privately operated bus services.