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Higher Fuel Costs Jeopardise City's Free Bus Services: Report

Posted on: Friday, 2 December 2005, 15:00 CST

By ARNOLD, Karen

FREE bus services are under threat as the Invercargill City Council grapples with higher fuel costs and reduced government funding.

The community services committee received a report on the situation at its meeting on Monday.

The Freebie and Southern Institute of Technology services are under the microscope, although fare increases are an option.

The council had been anticipating a 2.2 percent cost adjustment for the passenger transport contract for the 2005-06 year. However, escalating fuel prices meant the adjustment was 9.35 percent, equating to a further $33,100 needed from rates.

On top of that, Land Transport New Zealand is to reduce its funding in the 2006-07 year from 53 percent to 50 percent, putting added pressure on the council to meet costs. Invercargill Passenger Transport is contracted to the council to run its city bus services.

Managing director Tony Baas told the committee that any reduction in service would cause a downward spiral. Fewer people would come to town, meaning less money would be spent in the central city and its vibrancy would be lost.

Committee chairman Neil Boniface said it was a catch-22 situation.

History showed introducing fares on the free services between 9am and 3pm would reduce passenger numbers.

That had a bearing on the funding received from Land Transport New Zealand, Mr Boniface said.

Source: Southland Times, The

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