Operator trust in WA’s Public Transport Authority is at an all time low, but resurrection of confidence could be in sight
By David Goeldner | May 10, 2011
After seven years of being belted by a ‘bureaucratic stick’, WA school bus operators are looking for a rare chance to get a better deal out of a contract review report due for tabling next month.
Western Australia Road Transport Association’s Passenger Services Division Chairman Ray Gannaway, pictured above, says operators are optimistic that the Composite Rate Model (CRM) contracts will be revised and a better deal struck through Transport Minister Troy Buswell.
The review coincides with the WA Road Transport Association’s centenary celebrations after reverting from the WA Transport Forum title in January.
Gannaway says nine reviews of the passenger transport sector had been conducted by previous Labor Governments, inciting resentment from operators.
He says there had been reluctance to assist the contract administrator – the Public Transport Authority – in the past, but with the Buswell review operators are more forthcoming with information to help the process.
During March and April a three-member panel circulated as far north as Geraldton and south to Esperance, interviewing all contractors at public meetings.
“The resolutions from those meetings will be put to the Minister,” Gannaway says.
“We are hoping that with security of tenure, a better working document and trust between the stakeholders in the contract – the contractors and the PTA – we will get a better working relationship.”
Erosion of confidence in the PTA revolves around the CRM, implemented by the previous Labor administration in 2004 with almost no bus industry consultation, although it now affects 880 contracts.
“The lengthy contract document we were given in 2004 has been heavily weighted in favour of the managing authority – the Public Transport Authority,” says Gannaway.
“We’ve had problems managing it and that’s given rise to the review by the Coalition Government.”
Gannaway argues it would be folly to dismantle the CRM entirely, and calls for the critical elements of the model causing angst with operators to be removed.
The problem with the CRM as Gannaway and his member constituents see it, is the prescriptive averaging built into the modelling upon which operators are paid for supplying PTA-contracted ‘orange’ school bus services.
The composite rate paid is the total of each cost item which goes into operating a kilometric service.
Under CRM there is a list of some 32 items, covering cost of fuel, wages, cleaning, vehicle registration – the list goes on.
The problem with this model, says Gannaway, is the units are calculated on averages, not actual costs, which in turn means an operator in Geraldton could be paid the same in Esperance and all points between where costs may vary.
And even with a sliding rate scale applied to the type of school service operated – A, B or C – Gannaway says the system isn’t working.
It’s this element of the contract that Gannaway wants removed, and hopes the review will do just that.
He says the pre-2004 standard rate model was more equitable, but does not want to return an old system which lacked a progressive, modernising element.
“But it was more evenly applied and directed to each run,” he says.
“It’s the averaging that is hurting the contractor,” he says.
He says the industry would be happy if the rate struck on a composite rate model reflected actual costs.
“A composite rate is fine, but contractors are not being adequately rewarded for the work performed.”
Gannaway says by removing averaging, a reflective cost of each service provided in each part of Western Australia would be achieved.
“We have without doubt the biggest kilometres to cover.”
While the model has continued to be applied by the PTA unabated, and in a manner described by Gannaway as punitive, so too has there been an unabated erosion of confidence in the PTA.
“Security, trust and an element of goodwill has dissipated over the last nine years” he says.
“Since 1999 there has been a series of very expensive reviews to the orange school bus industry culminating in 2004 with the introduction of the CRM contract, of which the industry had little input despite our best efforts.”
What resulted was a 130 page contract document replacing a ‘simpler’ 25 page document.
Gannaway says the administrative aspect of the contract is huge, which includes a website causing heartache with the operator’s client base – the parents.
“The commonsense aspect of the headmaster, the parent and the contractor working together has been subjugated,” he says.
“The parent has to go to the website to register their child and can wait nine to thirteen working days to get their child a seat on the bus.”
He says the bus could be passing by the child standing at the side of a road while the application is being processed, a situation the operator is powerless to address under the current system.
“Every contractor bar none in the CRM contract world has lost trust in the management of the PTA,” Gannaway insists.
“The threatening manner in which the PTA has administered the CRM document has really caused a lot of angst with contractors to the point that every Member of Parliament has been contacted by the contractor.”
He says there is some optimism that the Colin Barnett-led WA Coalition government will swing the contract system back in the operator’s favour.
And in the centenary year of his Association, Gannaway would like to see security and trust in the industry again.
“Hopefully the recommendations contained in that report will come down in favour of a more stable industry for all school bus contractors,” he says.
“I believe this is the best and last opportunity to get a balanced outcome for the PTA, the industry and the tax payer in Western Australia.”
The report is expected to be delivered on June 8.