Possible corridors for an airport rail link identified by DoT

A senior economist at Essential Economics, Sean Stephens, has joined the debate about a rail link from the CBD to Melbourne Airport, arguing in The Age last week that “a rail link would help Melbourne maintain its world-class status, where visitors and locals could access Melbourne Airport, our gateway to the world, with ease and convenience”.

There are some misconceptions in the article and an evident misunderstanding of existing public transport services between the airport and the CBD.

The main supplier is Skybus, a privately operated and profitable operation that carries two million passengers per annum, or about 8% of airport passenger traffic. Skybus operates a 24 hour service (with 10-15 minute frequencies between 4am and 11.45pm). Because Skybus makes use of the emergency lane on the freeway, it takes 20 minutes from the airport to the CBD in the off-peak and up to 40 minutes in the peak.

Also, from next year, the Government will extend operation of the existing Frankston to Ringwood Yellow Smartbus service to connect with Melbourne Airport via Broadmeadows station. Buses will operate every 15 minutes with ticket prices based on the standard Metlink fare structure.

Mr Stephen’s only concrete criticism of Skybus is that the fares are too expensive and “well above those of comparable cities that provide a rail link”. In fact Skybus tickets cost $16 one way, much the same as those on the Sydney ($15) and Brisbane ($15) airport rail systems, notwithstanding Melbourne airport’s greater distance from the CBD. Skybus offers airport workers a discounted fare.

If there’s a case for pricing Skybus in accordance with the standard Metlink fare structure, as Mr Stephens appears to think, then the Government could subsidise Skybus in the same way that it subsidises other public transport services in Melbourne. As it happens, Skybus pays the Government a “dividend” of over a $1 million p.a. It’s probably the only on-ground public transport service in Melbourne that makes a profit.

Mr Stephens also criticises the forthcoming Smartbus service on the grounds that it will be “inconvenient for many travellers who need to get to the city quickly and would be of marginal overall benefit”. The reality of course is it’s not designed for time-sensitive travellers (almost entirely people on business) as they can use Skybus or take a taxi at company expense.

Smartbus will provide budget-conscious travellers who want to get to the CBD or other parts of Melbourne with the option of catching a train to the city from Broadmeadows station. It will also enable some travellers destined for the northern, eastern and southern suburbs to avoid the CBD altogether, as well as provide an alternative to driving for the many airport workers who live within the northern region.

Another of Mr Stephens’s contentions is that there are lower cost ways of providing rail. He argues that the 50 km Regional Rail Link project in Melbourne’s west, which is now in the early planning stages, has the potential to reduce significantly the cost of a link to the airport compared to previous estimates.

Just why this would cost significantly less than the Albion option considered in previous feasibility studies is not explained, but the key issue with using the existing rail network is that trip times would very likely be slower than Skybus. This would reduce patronage and hence the financial viability of rail. And the cost is still likely to be in the hundreds of millions, so there actually does need to be a business case for rail.

Mr Stephens also argues that rail can pay its way. He says that Brisbane’s Airtrain “announced a profit of $4.8 million in 2008 and now services nearly 2 million passengers a year”. This of course contradicts his claim that Skybus is too expensive. The fact is Airtrain is profitable because it charges $15 for a one way trip i.e. much the same as Skybus.

He also fails to mention that the operators of Brisbane’s Airtrain minimise costs by offering limited services. Compared to Skybus’s 24 hour operation, the last Airtrain service departs the airport at 8pm even though, like Melbourne, Brisbane Airport does not have a curfew. Services are also less frequent than Skybus. No wonder Airtrain now turns a profit if it doesn’t have to offer off-peak services – but what do travellers in Brisbane do after 8pm?

Another argument Mr Stephens presents is that analyses undertaken by his firm “show that a (rail) link would alleviate pressure on the freeway system”. It’s a pity we can’t review this study as it would be useful to know by how much traffic would be reduced (1%? 5%?), but there’s a more fundamental problem here.

The idea that public transport can provide lasting relief from traffic congestion is a common misconception. It has no more lasting effect than building more freeways or widening existing ones. Latent demand will inevitably fill up any spare capacity liberated by a train. Managing traffic demand on Melbourne’s freeway system requires smarter approaches, such as congestion pricing.

Like the arguments of so many proponents, Mr Stephens ultimately falls back on populism and “us too” logic. He says Melbourne needs an airport rail line because some (unnamed and unreferenced) report examined 52 cities around the globe and “found that 34 have airport rail links and 10 have rail links under construction or as a committed policy”.

I suspect that was the sort of thinking that started cities like Melbourne and Brisbane down the Wilbur Smith and Assocs path of building freeways in the 1960s.

We already have a good public transport system connecting Melbourne Airport with the CBD and it costs taxpayers nothing. It makes no sense to replace it with a new one that will very likely either provide an inferior timetable in order to be profitable or will require a public subsidy. In either scenario it is unlikely ticket prices will be any less than those charged by Skybus.

As I’ve pointed out before, the savings in carbon emissions from substituting a train for Skybus could be bought for vastly less than the cost of a new rail line.

The only real deficiency of Skybus seems to be that it’s a bus and most people with an interest in this issue prefer to travel in trains and trams (I know I do). But that’s a very poor excuse for building a rail line. The opportunity cost would be high – there are many other projects like providing improved public transport in the outer suburbs that would actually have real positive economic, social and environmental benefits.

In the long run it is likely that a rail line will be justified, but not yet.

(I’ve previously discussed the issue of a Melbourne Airport-CBD rail link here, here, here, here and here).