Track Record quarterly results: payments

December quarter 2012

Information on this page

Metropolitan trains and trams

Metro Trains and Yarra Trams receive regular payments from Public Transport Victoria to cover the delivery of services and the operation and development of the networks. The terms of these payments are outlined in operator franchise agreements.

PTV requires that operators meet agreed performance targets. Penalties or incentives are paid depending on how operators perform against these targets.

Incentive payments are based on a detailed measure of the passenger impact of service disruptions. These include delays, cancellations, short services and a number of other disruption types (including trains that bypass the City and / or Westona loops).

Each disruption is multiplied by an agreed ‘passenger weight’ for that service which depends on the route, the time of day, and the direction of the service. Longer delays result in higher penalties. Operators can receive bonus payments or incur penalties depending on whether the level of disruption
is above or below agreed levels in the contracts.

Metro payments ($,000)

Payment type	Oct-Dec 2011	Jan-Mar 2012	Apr-Jun 2012	Jul -Sept 2012	Oct-Dec 2012
Base contract	35,714	35,916	40,298	33,913	40,884
Incentive / penalty	533	-2,706	-472	3244	135
Customer Experience Performance Regime	-	-	213		-
Ticketing revenue guarantee	72,561	77,594	79,318	77,636	81,086
Maintenance and projects	68,230	45,464	65,842	67,572	62,890
Rolling stock	25,412	32,402	36,226	29,864	32,898
Operations and systems	9,801	12,789	13,856	17,838	14,000
Total	212,526	201,460	235,460	230,067	231,893

Yarra Trams payments ($,000)

Payment type	Oct-Dec 2011	Jan-Mar 2012	Apr-Jun 2012	Jul –Sept 2012	Oct-Dec 2012
Base contract	7,892	8,177	7,601	2,504	2,120
Incentive/penalty	-164	-323	139	224	-551
Customer Experience Performance Regime	-	-	373	-	-
Ticketing revenue guarantee	55,822	52,912	54,088	60,935	63,644
Maintenance and projects	25,927	6,745	16,226	15,094	16,733
Rolling stock	8,767	8,767	8767	8,767	8,767
Operations and systems	4,040	2,467	2,902	3,154	2,811
Total	102,284	78,745	90,062	90,678	93,524

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V/Line trains

Regional train and coach payments are made to V/Line which is a state-owned enterprise.

As with other private operators, PTV requires that V/Line also meet agreed performance targets. If passenger disruption is lower than the agreed targets, incentive payments are paid by PTV to the operator. If passenger disruption is higher, operators must pay a penalty to PTV.

V/Line train services payments ($,000)

Payment type	Oct-Dec 2011	Jan-Mar 2012	Apr-Jun 2012	Jul-Sept 2012	Oct-Dec 2012
Base contract	73,732	71,806	70,988	76,233	77,534
Incentive / penalty	-600	-766	-771	-1,323	-2071
Farebox	19,046	23,613	22,671	21,964	18,723
Infrastructure	18	-	-	-	-
Rolling stock	8,953	8,953	8,953	8,953	8,953
Total	101,149	103,606	101,840	105,826	103,139

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Metropolitan and regional buses

PTV has individual contracts with bus operators to run services in Melbourne and regional areas. Payments are made to these operators to help deliver route and school bus services.

Metropolitan and regional bus services payments ($,000)

Payment type	Oct-Dec 2011	Jan-Mar 2012	Apr-Jun 2012	Jul-Sept 2012	Oct-Dec 2012
Metropolitan bus	136,945	137,594	138,960	140,452	140,996
Regional bus	30,337	31,582	32,074	32,368	32,726
School bus	51,179	34,647	51,982	53,247	53,068
Total	218,461	203,823	223,016	226,067	226,790

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Background information

The details presented in this bulletin on payments for public transport services include:

Components of the contract payments made by the State to the operators and major service suppliers for the services provided;
Incentive or penalty payments relating to performance during a particular period; and
Ticketing revenue guarantee payments.

The incentive and penalty payments are reported on an accrual basis. In the first year of the current franchises, the magnitude of these payments (whether an incentive or penalty payment) was capped at $1 million per month for metropolitan trains and at $500 thousand dollars per month for trams. Under the contracts, these caps are adjusted on 1 July each year in response to changes to the Consumer Price Index (CPI). The figures are not final, as the contracts allow for adjustment in limited circumstances in later periods. Payments for prior quarters are subject to change based on audits or mitigated performance adjustments.

The ticketing revenue guarantee payment is a result of the introduction of the New Ticketing System and is expected to continue for up to 18 months following Metcard’s cessation. At that time, the franchisees will be entitled to farebox distribution under the revenue split arrangements stipulated in the New Ticketing System Revenue Sharing Agreement.

The train and tram partnership agreements do not include concession top-up payments for the usage of concession tickets.

All payments are exclusive of GST. Negative figures represent payments by the franchisee to the State.