GTA’s golden opportunity for fixing transit [Collenette]

By: David Collenette

Ontario should take over responsibility for GO Transit and the TC’s subways and LRT while privatizing buses and streetcars.

A majority Ontario government led by Kathleen Wynne, a premier from Toronto who knows the transportation file, provides a wonderful opportunity to deal with GTA gridlock. Despite recent investments in public transit, the realities of electoral politics have limited the scope for broader action. That’s about to change in next month’s Ontario budget.

“All politics is local,” as the saying goes, and tensions between local politicians and the province have often stalled the building of new transportation infrastructure. Decisions of TTC commissioners who are city councillors impact widely throughout the GTA, yet there is no incentive for Toronto to follow a truly regional strategy. The subway versus light-rail transit debate has tragically caused years of delay, millions of dollars in cancelled contract penalties and redundant construction. Commuters in the entire GTA are held hostage as a result.

The province created Metrolinx to plan and finance new infrastructure as well as operate GO Transit. Despite a quality board of directors, Metrolinx is not really an independent authority. It takes its cue from political masters and operates almost like any other government department.

While it is the responsibility of elected officials to make legislative and policy choices, the delivery of public transit, which is really an operating business, should be carried out in a businesslike fashion, devoid of political interference. A proven alternative to manage GTA transit would be the establishment of a not-for-profit authority, operating independently of government, as Ottawa did in the 1990s for airports and marine ports.

At the time, the country was well on its way to bankruptcy and the federal government did not have the billions of dollars required to upgrade aging infrastructure. The National Airports Policy and later the Canada Marine Act were the outcome of vigorous cabinet debate between those who wanted to privatize airports and ports and those who wanted them to remain publicly owned.

Ownership remained in public hands but there was a consensus on the urgency for a new solution to operate, finance and improve infrastructure while not being charged to the government’s financial accounts. There was less of a consensus to give up ministerial power to direct these authorities but ultimately they were structured in a way to avoid daily political interference.

Local airport authorities were established with a mandate for 60 years. Directors are nominated by stakeholder groups: the provinces, municipalities, organized labour, chambers of commerce (like the Toronto Region Board of Trade) and professional associations representing engineers, accountants or the law society. Their fiduciary responsibility is to the authority and not to nominating entities, which has allowed them to borrow billions of dollars off the government’s books. Revenue has come from user fees, not the general taxpayer. All profits are plowed back into the enterprise. As a result, some 20 years later Canada now arguably has the world’s best airport infrastructure.

Applying this model to transit would bring quick commuter relief. Metrolinx could continue to be the planning body for the long term, taking into account a myriad of factors shaping the growth of the GTA. However, the province should extricate GO Transit from Metrolinx and appoint a board of directors nominated by various stakeholders with powers over service, maintenance, infrastructure and operating priorities unencumbered by politicians.

Capital for new GO infrastructure projects, rolling stock and signal systems could be secured from pension funds and the financial markets. On the revenue side, GO already recovers an astounding 90 per cent from fares. An independent authority should be able to close the revenue gap but any operating deficit could be made up by long-term legally binding annual grants from the province. This type of “subsidy” would be similar to the type the U.K. government provides to its train operating companies, which have been responsible for an amazing 7 per cent annual growth in rail travel in the U.K. over the past 20 years.

For this model to work, the province should also take over responsibility for the TTC, putting the subway and LRT into the new GO Transit Authority and privatizing the operation of the existing bus/streetcar system. The TTC is an organization with a storied past but one, as currently configured, that cannot meet today’s demands. This change would be controversial but we already have a successful partnership model between government and business with the Viva service in York Region. Many cities around the world, like London, have contracted out the bus system with great success.

All politics is truly local. Adopting the local authority model would be a radical move but Wynne has shown she can make tough decisions. Freeing transportation building and operations from the shackles of political interference has one winner: the citizens of the GTA.

David Collenette served as federal minister of transport and minister responsible for the GTA from 1997 to 2003.