It pays to be clear about what public transport is designed to do

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Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.

More or less everyone agrees that public transport can be better, should be better and we would all be better off with more of it. They might disagree on how to get it — whether by investing in privately run fleets of driverless cars, say, or state-backed trams — but there is general consensus on the benefits.

These are many and varied. You might use public transport, for example, to alleviate poverty through subsidised or free fares. Or you might use it to expand the effective economic area of a city by growing its labour market, or to boost tourism, or the night-time economy. You might want to improve commuter links between a population centre and a place of work. Or your priority might be tackling climate change.

Yet in many places, public transport does not achieve any of these aims very well or even as well as it could. Part of the problem is that public transport is one of the things that a country does that everyone can see and touch — it is a “final mile” service. It is therefore attractive both to politicians who want to be seen to be doing something and to campaigners who want to call on politicians or companies to do something.

In practice what that often results in is a service that tries to do a lot of things badly. Take, say, bus services in much of England. The profitable part of the bus system had dwindled to almost nothing by the end of the 1970s as more and more people turned to the car, and the Thatcher government’s attempt to fix it did not work. In practice a lot of the services that remain exist for social justice purposes, particularly care of the elderly. Given that pensioners’ travel is subsidised, this makes the routes more expensive still.

English policymakers have often been confused about what exactly they want to accomplish with buses: should they just exist to get the retired and people on low incomes around, and should it therefore be a heavily subsidised, geographically patchy system focused on the elderly and the poorest? Is it meant to get people of all ages out of their cars? The answer has tended to be “let’s try a bit all of those!” and as a result none of them have been achieved as well as they could have been. And England is by no means alone in this: it is also true of, for example, the Los Angeles Metro.

Now, it’s true that very few public transport networks are run without public subsidy. The day-to-day operations of London’s network are a rare exception. But the capital has a fantastic inheritance from private sector innovators, who, in the 19th century, spent big to set up the beginnings of the city’s underground railway. In the present day, it is journeys on the Tube that cross-subsidise everything else Transport for London does. In many ways, TfL is a rail company with a really expensive hobby running buses.

As the new Labour government looks to expand the size and reach of public transport across England, London offers some useful lessons. But so too does Japan. Japan’s privately run transport companies, for example, spend extensively on well-run railways and bus networks that are the envy of much of the world. A little-known fact about Japanese public transport is that it is, in many ways, the world’s most effective side-hustle.

Because while Japanese rail wipes its own face financially, it is in infrastructure, property development and retail that these companies really make money. That’s not to say that the railways are incidental: as Toshihiko Aoyagi, the head of the Kyushu Railway, puts it, they are “the foundation of all of our businesses”. It is by building railways that get people from A to B quickly that the Japanese companies are able to make money renting flats at A, and through shops, entertainment and hotels at B.

As a result, Japan’s transport companies have clarity of purpose. They know that they exist primarily to build good railway connections that will increase the value of the rest of their businesses. Consequently they have built railways that also do a great job of getting people out of cars and into greener trains. They’ve done a better job of securing the benefits of good public transport almost incidentally than many policymakers elsewhere have managed by trying to get them all at once.

There’s an important set of lessons here. The first is that anyone wanting better public transport overall should start by trying to get that transport to focus on doing one thing well first and foremost. The second is that having a clear sense of what you are trying to do and what you want to achieve is always vital, whether you are building railways, driverless cars or running an organisation.

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