The concept of a ride on a tram or bus without having to buy a ticket is not something that may be easily understood by many, but it’s by no means impossible.
Remarkably, running a public transport system where people can hop on and off with freedom of the city can also be done at a profit. We have proved this in Tallinn.
To many European Union members, particularly in the Baltic region, the United Kingdom’s rigid policy of charging relatively high fares appears puzzling. I cannot see any fundamental reason why there cannot be some form of concession in certain areas, at particular times of day, or for special groups of people.
The largest city in Estonia, Tallinn’s urban population is currently 450 000 (a third of the national total) and is growing at an annual rate of around 5000. Yet while Tallinn still retains a ticketing system for visitors, since January 2013 we have offered free travel to residents for all trams, buses, and trolleybuses (managed by municipal operator Tallinna Linnatrasnpordi Aktsiaselts TLT), and also rail services (managed by state-owned Elron AS) within the city boundaries.
The main reason for this quantum policy shift is what we describe as ‘social urgency’. After the world financial crisis of 2008-09, Estonia needed to survive economically and there was the serious threat of a population exodus to other countries. In a country of just 1.3 million, only the capital region is prospering and we expect to lose around 15% of our people over the next 30 years.
The results of a 2010-11 municipal satisfaction survey clearly indicated that the ticket price for public transport was a major issue. This is not unique to Tallinn, because Europe-wide research in 2014 revealed a similar opinion. It is equally a problem in the UK, Germany, the Netherlands and Sweden.
In Tallinn, we took the radical decision to introduce free travel for all residents of the city, and the effects have been profound.
It has stimulated the consumption of local goods and services, people go out more in the evenings and weekends and this is obviously transforming the local economy. It has also enhanced the labour market, widening the area where people can look for and take jobs beyond just walking and cycling distances.
Congestion, not pollution
There are no serious environmental or pollution issues to address as Tallinn is situated on low ground on the Baltic coast, so air quality is not a major or urgent concern, and nor is noise and vibration. What is important however is congestion in the city centre, which is where everyone wants to travel into.
Before changing our transport policy, we held a public referendum, and three-quarters of those taking part voted for change. We already knew the outcome, but it was important to secure endorsement for the plan and ensure that the city’s government and other public organisations were given a mandate for change.
To prepare the shift to free public transport, a big step forward was taken to increase vehicle speeds and reduce journey times. While we already had an extensive network of exclusive bus lanes around the city centre, it was now politically possible to get them into the very heart where they were most needed.
The next step was a sharp increase in car parking tariffs, which was carried out in two stages using a zoned pricing system. Now, we charge EUR6/hour 24/7 to leave a vehicle on the street in the historic centre, and up to EUR4.8/hour in surrounding areas.
But our message is: You have a free alternative. It is difficult to justify a complaint about parking prices if you have a free public service that is more efficient. That mind shift has been implemented relatively smoothly, and we haven’t detected a high level of public dissatisfaction.
Can this policy be replicated?
Free travel is not something that can be copied everywhere, but in Poland, which has a similar tax regime, it has been implemented in some cities with the same techniques.
In Estonia, the municipal budget is mostly generated from personal income tax, which is directly linked to where people live and not from the location of employment. This new funding system began in 2001 and the more recent introduction of free public transport for Tallinn residents has not surprisingly helped increase its population by over 30 000. Our conservative estimate is that every 1000 residents contribute about EUR1m, so we can reasonably calculate that the additional income so far is well in excess of EUR20m. And if the pricetag – that the money the city lost from the farebox revenue was EUR12m – you can see that the books more than balance, and that this has actually been a fiscally profitable course of action.
These simple maths reveal how it has become possible to invest substantially more in free public transport, and improve its quality. Of course, not all additional tax money is going towards public transport, but some of it is and this is part of the answer as to how our system has been upgraded.
We have achieved a 10% increase in usage, to about 140 million trips per year, but this is not as much as we had hoped. There has been free travel for over-65s for some time, and discounts for students, so we had a large new audience to convince that the change was a positive one.
The good news is that we have seen a sharp fall in private car ownership in Tallinn in recent years, against the national trend. We don’t have strong enough evidence yet to link this directly to the introduction of free public transport, but they do coincide timewise, and it’s evidently a pleasing and desired development.
With regard to traffic in the city centre, there has been a slight decrease, but in the surrounding areas some increase. The latter is evidently linked to the cost of parking a car, but drivers probably do drive further cruising around looking for a place.
The city and its trams
First free public transport nation
Tallinn did not invent free public transport. It has been introduced in many places in Europe since the 1970s – but significantly, abandoned in some and lasting in others.
Newcomers Dunkerque in France (population 200 000) and the town of Avesta in Sweden (23 000) are keen supporters of the concept. A number of Polish conurbations have also made a success of it. Chengdu in China (population over ten million) began a partial transfer to free public transport at the same time as Tallinn, as a trial during construction of a second ring road to ease traffic levels.
The changes in Tallinn have not been dictated by politics. Free fares have now been in operation for six years, and have stirred up interest across the rest of Estonia. If Tallinn can do it and afford it, why can’t the national government organise it elsewhere?
The answer is, it can, and from 1 July 2018 this will happen with county bus services. The sums indicate that it will cost an estimated EUR20m (EUR10m in lost revenue and another EUR10m in additional national subsidy). It is not the most expensive policy to implement, but the money still has to be found from somewhere.
So, Estonia is going to be the first country in the world to offer free public transport nationally, with the reservation that this phrase has not yet been universally defined.
There is definitely strong pressure for Tallinn to redefine its limit of no-cost public transport for residents, and it may be that in time it will be free for all. Now that’s something to think about.
Article originally featured in May 2018 TAUT (965).