The only way to make sense out of change is to plunge into it, move with it, and join the dance.Alan Watts, philosopher, 1915–1973
One of the key issues with respect to managing any affected informal industry is whether to remove it from competition with the new BRT service. Ideally, the BRT system’s service plan should indicate the existing minibus or bus routes that should be incorporated into the new BRT system, the routes that should be cancelled, and the routes that should be modified or rerouted to avoid direct competition with the new BRT services.
One of the key reasons to involve the affected informal public transport operators in the new BRT services is to give them a vested interest in removing their existing services from competition with the new BRT system. Even if the service plan calls for the removal of competing informal public transport services, it is frequently quite difficult to implement this in practice.
There are a few main reasons why competition with informal public transport operators is generally (though not always) removed from the mixed traffic lanes on BRT corridors. First, the more bus routes that use the BRT infrastructure, the more customers that benefit from the new BRT infrastructure. The more customers, the more profitable the system is likely to be, and the fewer subsidies the BRT operations may require. Second, the more public transport vehicles that remain outside of the BRT lane, the more they will contribute to mixed traffic congestion. An oversupply of public transport services on trunk corridors, leading to unprofitable, low-quality public transport services and greater than necessary traffic congestion, is a well-known market failure known as “destructive competition.” Ideally, the services of the new BRT system are so good that pure free market competition would induce almost all customers to switch to the new BRT system, but if they are less than ideal, it still may be better to limit this competition.
If impacted operators are given some extra advantage in a competitive tender, then turning over a significant number of the affected route licenses upon signing of the operating contract can be a requirement of the contract with the new operator. If the new operator includes the informal power structure that originally controlled access to the corridor, then the requirement to withdraw competing routes should be reasonably self-enforcing.
If the decision has been made to turn over the operations to a consortium constituted from affected operators through negotiations, a plan for the scheduled withdrawal of competition from the BRT routes is one of the agreements that should be reached. This should detail which existing routes will be completely withdrawn, those that may need to be restructured and how (because of partial coverage by the BRT network), and those that should continue because they served different origins and destinations to the BRT, but which may need to be relocated from the BRT busway onto different roads. The affected operators who become shareholders in the VOC will need to demonstrate that they have withdrawn their existing services according to the plan. This can be done in various ways, including submitting the vehicle for sale or scrapping to the city or proof that the vehicle has been sold, submitting existing operating licenses or permits for cancellation by the relevant government entity, and signing of restraint of trade agreements. Where compensation is paid out for withdrawal of existing services, it becomes even more crucial that the withdrawal can be demonstrated.
Where regulation is weakly implemented or enforced by government entities, the effective withdrawal of existing services is not easy to achieve. If large numbers of operators do not have operating permits in any event, and if the system is weakly enforced, then the city may find it difficult to prevent competition from developing again on the route. In these situations, the city may need to embark on a process to reregulate public transport, beginning with the BRT corridor in question. Reregulation would need to commence prior to implementation so that existing operators on the route are known and formalized before some are taken off.
Sometimes an institutional conflict of interest can prevent the withdrawal of existing services. For example, in Jakarta the Department of Transport, under whose control TransJakarta falls, earns significant revenues from the allocation of bus routes to bus companies. As a result, there was great reluctance on its part to cut parallel bus routes in the TransJakarta corridor, as the department lost revenue from each new line allocated. No competing services were therefore withdrawn, and they run in the mixed traffic lanes parallel to the busways.
In the Lagos BRT-Lite project, the approach was to involve the existing operators in delivery as much as possible, and to avoid marginalizing existing operators on the corridor. The danfo and molue (informal minibuses and midibuses) were not removed, but were banned from the main busway, and restricted to the parallel service roads. This meant that the limited capacity of BRT-Lite in early operation was supplemented and that existing vehicles could continue operating (the trips on the BRT-Lite only make up a quarter of all the trips in the corridor). A regulation finalized prior to the start of operations prohibited the operation of vehicles other than those franchised for the BRT-Lite scheme (and certain emergency services) in the busways, and also restricted the informal minibuses and midibuses to the service lanes (Integrated Transport Planning Ltd., 2009; Mobereola, D., 2009).
If, as a practical matter it is impossible to prohibit the use of informal public transport operations parallel to the BRT system, then it will be even more incumbent on the BRT system to provide a service that is competitive in terms of cost, speed, comfort, and convenience for its customers. In addition, all demand projections and financial projections should take this fact into account.