Bus transport in Buenos Aires. Paradoxical experiences after 10

years of revision.

Lisbon, 2005.

Andrea Gutiérrez.

University of Buenos Aires - Argentina.

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The query of the paper.

– The displacement between objectives and results in contractual regimes for urban bus transport.

– How to analyse recent changes in the Metropolitan Region of Buenos Aires.

The method.

Hierarchical interdependence

Level Objectives Results Relationship

Strategic Linear

Tactical

Operational

THE PARADOXES AND THE S.T.O. SCHEME

The displacement O & R as a paradox. Vertical analysis -> hierarchical relationship. Horizontal analysis -> linear relationship.

The problem.BUENOS AIRES AS AN EVIDENCE CASE

Public bus transport is renown abroad for its good level in service and coverage without subsidy, on behalf of small private enterprises under public regulation.

Regulation remains the same (doesn’t have a substantial reform), but a new enterprise structure emerges after a regulatory revision in the 90’s.

Subsidy is not the cause of revision, but it takes place later.

The Case.REGULATORY REVISION

OBJECTIVES – STRATEGIC LEVEL

Improve the existing situation (not a transformation) Efficiency with stability. Diversification with stability.

The Case.REGULATORY REVISION

OBJECTIVES – TACTICAL LEVEL

Settlings permits of public services (PS) through strong intervention with the same regulatory framework (franchising). SETTLE - ADJUST

Regulation of (existing) free offer service (FOS) through authorization without price regulation or operational conditions. LEGALIZE- FORMALISE

The Case.REGULATORY REVISION

OBJECTIVES – OPERATIONAL LEVEL

To renew permits (PS) or to obtain authorization (FOS) conditions are shared.

Setting up of enterprises. Economic capacity (guarantees and assets). Technical capacity (size, type and fleet age).

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REGULATORY REVISION - EXPECTED RESULTS

Different level of satisfaction.

In PS stability of permits and services is achieved, but not efficiency nor diversification.

Permits are settled (till 2000). The level of service and coverage continue. Costs (54%), fares (118%) and earnings (60%) increases. Demand drops (37%). Renewal of fleet (type and age) till 2001. Diversification of services is marginal and decreases.

The Case.

REGULATORY REVISION - EXPECTED RESULTS

Different level of satisfaction.

In FOS stability and diversification is achieved.

The level of service and coverage grows. Fares climbs. Diversification of services increases. Renewal of fleet (type and age).

The Case.

REGULATORY REVISION - UNEXPECTED RESULTS

Service profile (FOS). Enterprise profile (PS). Direct subsidies (since 2001).

Buenos Aires has the same problems in a new scenario.

The unexpected results are more lasting: a new business scale and a new (and unequal) profile of service.

The Case.

The Discussion.OBJECTIVES AND RESULTS

Isolate analysis – divergent paradoxes. HORIZONTAL ANALYSIS

No linear cause effect relationship. Disproportion (small changes lead to grate changes).VERTICAL ANALYSIS

Interdependence between levels (objective, also results) not hierarchical.

transversal relationship between levels.

The Discussion.OBJECTIVES AND RESULTS

Comparative analysis – convergent paradoxes.

One same contract form

Isolated analysis

Divergent paradoxes

Objectives Results

Convergent paradoxes

Comparative analisys

Different contract forms

The proposal.FORMS AND CONTENTS

A contractual regime is, in first place, a relationship. Regulatory framework (forms) and regulatory

relationship (contents). Regulation and innovation. Change to continue.

The change in forms disguises the contents permanency, showing a shift between objectives & results as a paradox.

The proposal.SCALES OF ANALYSIS

A relationship needs other methods for its comprehension. The network links or relational space diagnosis. The contents and its contexts. The micro (individual) and macro (global) context.

Regulatory relationship has a multiple context. It needs complementary scales, not only sectorial scales.

The proposal.DIMENSION OF ANALYSIS

A relationship need other methods for its comprehension.

Interdependence between levels of analysis, and dimensions of analysis.

Results could not be an economic or political conflict. Mobility helps to reveal contents.

Regulatory relationship has a multiple context. It needs a three - dimensional analysis.

The conclusions.METHODOLOGICAL LESSONS

Distinguish regulatory form, content and context it is useful to capture the displacement between O & R.

A kit of scales and dimensions improve the comprehension.

Changing forms assuming simultaneous, linear and/or proportional changes in the contents, is a mistake.

Forms could mask or reveal contents. Results of different levels acting at different (lower)

levels, under the same forms.

...“Ninguna revolución se hace contra las formas. Lo que cuenta es

el fondo”...

Rayuela, by Julio Cortázar.

The conclusions.PRACTICAL LESSONS

• The regulation shows efficacy to provide stability to the service and enterprise maturity.

• Stability of the service should not be confused with stability of the enterprises or the regulation.

• There is no direct link between the size of the enterprises and efficiency nor innovation.

• Occasionally, regulation is unable to include innovative elements (as FOS) and stresses the unequal service conditions.

Passengers, revenue and subsidies of public transport in the Metropolitan Region of Buenos

Aires. Services of national jurisdiction, 2004.

Mode

Transported passengers

Millions

Revenue Millions

(u$s)

Operative subsidy

Millions (u$s)

Gas Oil

differential price

Millions (u$s)

Tax reduction

Millions (u$s)

Buses 1.444.8 430 71.2 58.7 34.3

Railway 636.4 144.8 101.7 10.7 w/d

TOTAL 2.081.3 574.8 172.9 69.4 34.3

Results Level Objectives Guidelines Expected Not expected

Strategic Efficiency (PS) Diversification (PS / FOS) Stability

Renewal (PS) Authorization (FOS)

Inefficiency (PS) Diversification (FOS) Stability

Cost and fare increases Demand drops Subsidies

Tactical Ordering (existing situation)

Maintains the same franchising and closed competition (PS) Enlarge regulation (FOS)

Ordering, followed by new non compliances

Change of enterprise and service profiles (diversification for the “rich”)

Operational Modernization Enterprises Solvency Fleet

Formalisation, followed by new illegality (FOS) Solvency, followed by debts. Fleet renewal, followed by ageing.

Enterprise maturity. Bankruptcies, mergers, take over Less but bigger enterprises

• In PS, stability of permits and services is achieved, but not efficiency nor diversification.

Permits are settled (till 2000). The level of service and

coverage continue. Costs (54%), fares (118%)

and earnings (60%) increases.

Demand drops (37%). Renewal of fleet (type and

age) till 2001. Diversification of services is

marginal and decreases.

In FOS stability and diversification is achieved.

The level of service and coverage grows.

Fares climbs. Diversification of services

increases. Renewal of fleet (type and age).

The Case.REGULATORY REVISION - EXPECTED RESULTS

Different level of satisfaction.