Auckland’s integrated ticketing saga might seem like just another IT boondoggle with delays and cost blow outs.
But when the progress of Auckland’s public transport system is at stake, not to mention $98 million of public money, it is inevitable the public will want someone held accountable.
The Herald has pointed the finger at Snapper, saying the company should make its smart card compatible with the new integrated ticketing system or face the consequences.
Transport Minister Gerry Brownlee has threatened NZ Bus (which like Snapper, is owned by Infratil) could be “off the run”, losing the $70 million subsidy it gets for running 70% of Auckland’s buses if it can’t get the Snapper machines on its buses to work with the new system.
Back story: in 2009 Snapper lost out to French technology giant Thales in a competitive tender for the integrated ticketing system designed to be set up in Auckland and then rolled out in other centres. About a year later NZTA and Auckland Transport decided to allow Snapper to roll out its card on the NZ Bus fleet as long as it could guarantee compatibility with the new Thales-built system. There have been successive delays and things came to a head last week with a leaked lawyer’s letter from Auckland Transport to Snapper asserting the November 30 deadline would not be met and that Snapper was in breach of contract, with hundreds of thousands of dollars in extra costs piling up by the month. (For more history on this see Rudman, or Transport Blog if you are really keen.)
Snapper have been painted as the bad guy: losing out in a competitive tender, then sneaking back into the marketplace, and trying to use their dominant market position in Auckland to establish their card alongside instead of within the main system. The commercial incentive is obvious. If NZ Bus uses Snapper they get access to a sizeable cash float as public transport users charge up their Snapper cards. They also get a treasure trove of data about public transport journeys and consumption patterns that would help them wipe out competitors.
I think having a go at Snapper is too easy. We shouldn’t be surprised that a company aggressively competes for market dominance.
But we should expect our politicians to make decisions in the public interest, and not screw the scrum on behalf of private interest which seems to be what happened here. I’ve been told by former board members of both agencies that then transport minister Steven Joyce intervened on behalf of Infratil, putting pressure on both boards to let Snapper roll out their card in advance of the new system.
Last week in the House Gerry Brownlee denied his predecessor had any role in the decision making, saying it was a decision for Auckland Transport and NZTA.
Both Mike Lee, former chairman of Auckland Regional Council, and Michael Barnett, also a former elected member of the ARC, have publicly said that lobbying of and by central government politicians led to what has turned out to be a very unwise decision.
That is why I have asked the Auditor General, who is already investigating Auckland’s integrated ticketing project, to include an examination of the role of central and local government politicians in the decision making around Snapper’s early roll out.