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SA Government to privatise Adelaide train and tram services

The reforms will mean the State Government retains control of key elements of the rail system, but operations become the responsibility of a private operator. Courtesy: Tait Schmaal

Operation of Adelaide’s train and tram networks will be privatised under controversial reforms the State Government insists will deliver better services for commuters.

After earlier this year leaving all options on the table, Transport Minister Stephan Knoll has now announced plans to release a tender which will result in a private company running the rail services in a similar way to what already occurs with buses.

It has raised concerns about job losses for rail drivers, who would have to seek new employment with the private operator.

The changes would be complete in 2021.

Unions are now gearing up for a “massive public campaign” to warn commuters about the dangers of privatisation and say prices will inevitably rise as services are cut.

Mr Knoll stressed there would be no “sell off’ and assets including vehicles, tracks and stations would all stay in public hands.

The Government will also keep power over the setting of ticket prices and decide how frequently rail services in Adelaide were run.

He said the State Government would:

RETAIN ownership of rail assets including vehicles, tracks and stations;

SET requirements for levels of service to ensure efficiency and quality;

CONTROL fare prices and retain the revenue.

Mr Knoll said outsourcing operations would make it possible for the Government to keep a private company more accountable than possible when managing services in-house.

We are the only light rail network in the country that is operated internally,” he said.

“I don’t think there are too many people in Adelaide who would say that the way the existing bureaucracy is working is optimal. We know that private business is able to provide a customer-focused service, in ways that governments struggle to.”

Rail Tram and Bus Union SA secretary Darren Phillips said privatisation was a “scam” which would result in reduced standards, job losses and commuters being “fleeced”.

“The only reason a private company would want to run a train or tram service is to make money out of it, at the expense of both taxpayers and travellers,” Mr Phillips said.

“Mass transit services should be run by the people for the people, not for the profits of overseas companies and their shareholders.”

Experience from Victoria showed taxpayers had been squeezed for private profits, and surveys in SA showed higher satisfaction with government-run rail services, he said.

Public Service Association SA secretary Nev Kitchin said privatisation was the Government’s “main game”, amid other moves in the prison sector and health system.

Mr Knoll was unable to guarantee ongoing jobs for all drivers.

He said the Government would work with tender winners to “make sure to the greatest extent possible that the existing workforce gets the greatest opportunity to transition”.

“The State Government can guarantee maintaining the same service frequency and standards and strongly expects to be able to increase service levels once this model is fully implemented,” he said.

“We know that public transport patronage growth has stalled and customers want a better level of service than is currently provided.

“Under this model, we will be able to deliver more efficient services, so we can reinvest back into the network to provide better services.”

Mr Knoll said he was willing to argue “until I’m black and blue in the face” against critics who say the move will result in higher costs and poorer service.

Tram services will be included in the scope of Phase 2 of a current bus services contract tender being released today. Timings for the train tender will be finalised after a market engagement process starting later this year, and full transition to private sector operations is expected by mid-2021. The next state election is in March 2022.

Opposition Leader Peter Malinauskas said the decision was a “betrayal” from Premier Steven Marshall, who had not flagged the privatisation plans before the election.

“Public transport will now be less about people and entirely about profit,” he said.

“This is a public service that should be prioritising service delivery for people.

“We know what will happen because we’ve seen it happen before.

“Privatisation of public transport means cuts to services and higher fares.”