Assistance to pilot Region Associations - 2nd Seminar on Passenger (Bus) Transport Sector (Moscow - Follow-up from Ryazan Seminar on 17/02/99) Public Transport: Final Report, March 1999)

In the short span of time that elapsed, an important development took place - on Feb. 26 for the first time in Russia a union of transport operators was created. Mission of the union - to lobby the interests of transport operators at all levels of government.

The workshop in Moscow was attended by a representative from the RF Ministry of Transport, by officials from four pilot associations - Krasnodar, Moscow, Ryazan, Smolensk, by TACIS experts and the editor of Russky Yamshik, a journal of transport operators. All in all, there were 24 participants (see full list in the Annex).

The purpose of the meeting was to:

  • follow-up the discussion of public transport problems faced by members of Associations and approaches to addressing these problems
  • discuss professional concerns that Russian and western participants have in common
  • a comment on the Public Transport Reform Project proposed by RMOT and make suggestions for changes and amendments
  • develop a draft report of the meeting results and forward copies to the Russian Road Transport Union (RRTU), RF MOF and the City Administration (Moscow and all pilot local administrations).

2 MAIN RESULTS

The meeting of Project participants was aimed at achieving practical results and was conducted in the form of a workshop. Problem issues were discussed in 3 work groups; this was followed by presentation and discussion of results at a plenary session. All the discussions were held in an interactive form, and each participant had a chance to speak and be heard. The workshop consisted of 3 steps:

  • analyse possible ways of facilitating the implementation of measures identified and discussed at the meeting in Ryazan on Feb 15determine the priorities in each of the three problem areas
  • for each of the items on the list of priorities, develop an action plan and determine the role of the Association.

Details of each of these steps are presented below.

Step 1: Identify measures that are beyond our control (in other words, things that we cannot directly affect)

Of the 48 measures (see Summary Table from the Ryazan’s workshop) aimed at improving public transportation services, 45 were identified as being beyond the direct control of either transport operators or the Association.

Only three measures were unanimously recognised as being within the scope of control of transport companies:

  • to increase the companies' rate of return (cost coverage)
  • optimise the network of routes and vehicle usage
  • develop proposals for cutting down maintenance and repair costs

The discussion of the role and the position of the Association had led to the following major conclusions:

Possibilities for taking direct action to improve the situation are limited. Authority is lacking. The role of Association and that of its members is seen primarily in initiating steps aimed at resolving these problems, in lobbying the interests of carriers at all levels of government both through its regional branches and through the Russian Union of Transport Operators (RRTU).

Step 2: Determine priorities in each group of problems

Discussions in the three work groups identified the following priorities:

  • The first set of priorities included the following three measures that the participants suggested to treat as one priority because of the presence of cause-and-effect relations:
  • Establish a system of ‘addressable subsidies’; all trips should be payable via the purchase of tickets
  • Increase the company's rate of return
  • Legislatively establish that the fare (ticket price) should be computed in such a way as to provide for a rate of return of 30%.

The first measure was seen as the cause, and the other two as effects.

  • The second priority identified was formulated as “Develop and implement a methodology for computing transport fares/tariffs”
  • The third priority was identified as “Ensure equal starting conditions for all carriers”

Step 3: For each of the priorities above, develop a list of measures to implement the priorities and identify the role of the Association.

Discussions in work groups resulted in the following proposals that were supported and agreed upon by all the participants:

Priority 1: Subsidise customers; all trips should be payable via ticket purchases

Subsidise customers, all trips should be payable via ticket purchases

Required steps

Actors

1. Defend the rights of carriers at court

 

1.1 Do a legal analysis of current legislation from the point of view of internal consistency of laws, and consistency between laws and the Civil Code and the Constitution

RRTU*: provide legal assistance in the form of legislative documents and a team of qualified lawyers

1.2 Taking parallel action in several regions of Russia, create judicial precedents in courts of first and second instance

Regional associations: initiate, consult and co-ordinate the process at the regional level and co-ordinate the efforts of regions

1.3 In cases when previous instances delivered negative verdict, apply to the Supreme Court

RRTU: co-ordinate appeals to the Supreme Court.

A work group formed by regions shall present all the documents and provide partial financing of the process

1.4 If the verdict of the Supreme Court is negative, go to the Constitutional Court

RRTU shall co-ordinate the appeal to the Constitutional Court and inform the mass media.

A regional work group shall provide all the required documents and partial financing of the process. The group shall be responsible for PR in the regions

2. Initiate the law that sets the rules for granting benefits and purchasing tickets

 

2.1 Organise the participation of the Association in elections to legislative bodies of all levels to create a transport lobby

Regional associations develop a common strategy and action plan, reach an agreement on the mechanism of financing the campaign.

RRTU performs general co-ordination.

2.2 Develop and approve draft Law "On the procedure for granting transport fare benefits”

RRTU prepares the Draft Law and organises broad discussion of it at all levels of government with the ultimate aim to pass the law. It organises contacts with the press, and participates in editing an finalising the draft.

* RRTU = Russian Road Transport Union of Operators

 

Priority 2: Develop and implement a methodology for determining transports fares/tariffs

Develop and implement a methodology for determining transports fares/tariffs

Required steps

Actors

1. Do an analysis of the current legislative framework of the transport fare policy

RRTU provides legal support and general co-ordination of efforts

2. Do an analysis of the of existing methodologies for calculating fares

Regional associations and RRTU select consultants and consulting institutions and develop TOR.

3. Determine the main aspects that should be accounted for in developing the methodology (rate of return, etc.)

RRTU implements control, co-ordination and organises discussion of proposals

4. Propose a mechanism for financing the development of such a methodology

Pilot regional associations do the work that can be financed under the TACIS Road Transport Development Project

5. Prepare pilot guidelines for calculating transport tariffs

RRTU assigns an organisation or institute (for instance, NIIAT) with a task to develop the methodology

6. Field test the proposed methodology in a pilot region (for instance, in Ryazan)

A regional association (for instance, Ryazan) fully co-ordinates pilot testing

7. Based on the results of the field test, make the appropriate changes in the methodology

RF MOT, RRTU, and regional associations jointly with the organisation/institute in charge of developing the methodology finalise the guidelines (taking into account the comments and suggestions for improvement that resulted from pilot testing)

8. Ensure that the government approves the proposed methodology

With the support of RF MOT, RRTU initiates a legislative motion at the federal level

9. Implement the methodology

RRTU with the assistance of RF MOT and other agencies

 

Priority 3: Implement equal starting conditions for all carriers

Implement equal starting conditions for all carriers

Required steps

Actors

1. Implement joint administration by all carriers based on contracts between public authorities and carriers

Associations (regional and RRTU) defend and lobby the interests of carriers, negotiate with public authorities, provide legal support and advice

2. Make a transition to the competitive system of awarding contracts to public carriers using the criteria of the rate of return (cost coverage) and quality of services

Associations participate in development of bidding rules and in the work performed by the screening committee

3.Assist in determining the layout of combined routing networks and in competitive award of service contracts to public carriers

The Association shall participate in optimising the composition of the network of public transport routes, in conducting surveys of passenger flows, in setting the bidding rules, and in selecting the winning bids

Legislatively mandate that all passenger trips shall be payable via ticket purchases

RRTU and regional associations fully participate in drafting the law on public transport benefits (see Priority 1)

Mandating full compensation of costs to the carrier in cases when public authority of any level legislates the right of any target group to free or subsidised rides

Associations shall defend the interests of carriers and oversee the timeliness of compensatory payments

Implement a common taxing regime for all public carriers (federal, regional, local)

RRTU and regional associations assist in development of proposals and lobby the interests of public transport carriers with al public agencies dealing with taxation

A proposal was made to develop a TASIC-sponsored/supported demonstration project in Moscow Oblast.

Priority 4: Develop a mechanism and procedure for supporting the increasing the income raising capacity of the regional transport associations.

The following components were suggested:

  • Transport/haulage operations
  • Instrumental control
  • Vehicle checks and certification
  • Issuance of transport/commodity documents
  • Training (professional qualification and driving safety)
  • Conducting pre-qualification testing of operators

Priority 5: Develop guidelines for purchasing buses

  • via leasing
  • via subsidised credits
  • develop a mechanism for granting tax concessions

Study and analyse the experience of others (for instance, of Byelorussia) and develop recommendations for the Russian market. This assignment can be given to the Krasnodar regional association.

3 RECOMENDATIONS

  • Since the workshop was attended mostly by regional transport associations, without adequate participation of federal officials, in order to make the results of the Moscow workshop known to a wider audience it is necessary to organise a meeting between pilot associations and representatives of the following key actors:
  1. RF MOT: deputy minister Mr Nasonov and acting head of Road Transport Department Mr Pinion
  2. RRTU: Mr. Nikolayev, President

It would be preferable to conduct this meeting before the end of April 1999. The issues to be covered at the meeting include:

(à) report on the results of discussions of public transport (bus transport) problems, identified by Association members,

  1. discuss proposals of pilot associations on reforming public transport,

(c) on the basis of these proposals develop an action plan to be implemented under the guidance of RRTU; for each item of the plan indicate the party responsible and the deadl

Þ In order to carry out and co-ordinate the implementation of top priority tasks, set up 3 work groups under the auspices of RRTU and with financial support of the TACIS Russian Road Transport Development Project .

Each work group shall include 2-3 permanent staff members who shall co-ordinate all efforts. If needed, services of individual experts and organisations shall be recruited.

Priority 1: Subsidise customers, make all trips payable via ticket purchases - V.M Chrepovsky , President of Smolensk Association, shall be the team leader

Priority 2: Develop and implement a methodology for computing transports fares/tariffs - team leader Yu. I. Pochtarev, President of Ryazan Road Transport Association.

Priority 3: Ensure equal starting conditions for all carriers - team leader Yu. K. Logvinenko, vice-president of ASMOR.

  • Recommend to set up a team of lawyers specialising on transport issues under the auspices of RRTU to provide advice and protect the interest of transport association members
  • Recommend to intensify exchange of experience among Russian transport agencies on various issues and among various regions. In order to do so, appropriate, under TACIS project and upon review by work teams, a special budget for short-term business trips, for instance:
  • to learn the experience of carrying out instrumental control (Khanty-Mansyjsk, Chita)
  • to learn the experience of issuing commodity/transport documentation (Chelyabinsk)
  • to learn the experience of obtaining subsidised loans for purchasing transport vehicles (Chelyabinsk, Krasnodar)
  • Recommend to develop, with the support of the TACIS project, a demonstration project for ensuring equal starting conditions for all carriers in the territory of the Moscow Oblast (ASMOR).

 

ASMOR association /Y. Logvinenko/
Krasnodar Transport association / V. Shemchilo/
Ryazan Transport association / Y. Pochtarev/
Smolensk Transport association /V. Cherepovsky/
Tacis Road Transport Development project manager /K. Broersma/

 


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