Gratis Bus Rides: Free Lunch or Last Supper

By Yang Xingyun
Published: 2008-07-31

From Nation, issue no.378, July 28, 2008
Translated by Liang Duo

For 72-year-old retiree Zhen Jinxiang, the main task of the day was sending and fetching his 10-year-old granddaughter to school.

To accomplish the task, he used to make four bus trips costing a total of 12 yuan each day, but for a senior citizen living on government's lower-income subsidy, the public transportation cost was eating into his budget.

Fortunately for him though, such burdens had been scrapped off his daily budget since July 1, when the municipal government of Changning introduced free public bus rides in the City. The move was the first in China.

Changning is a metal and mine-rich city located in the south of China's Hunan province. Its municipal government has implemented free public buses in order to conserve energy, protect the environment, improve traffic condition and enhance public services.

Free Services Outreach
The sixteen buses that servied Route 4 daily each made over 20 stops. One bus conductor named Li Xiang told the EO that, since the introduction of free bus rides, the volume of passengers for the route had jumped by at least three-fold.

Zhan Yong was one of the newly recruited bus drivers for Route 4. He said each bus would top-up 150 yuan worth of fuel daily, and insurance and cleaning fees would amount to about 70 yuan.
Based on official data, Changning has three bus routes operating for free with a fleet of 45 buses at present. Local authorities hired 70 drivers and 50 others, mainly laid-off workers, to join the operation.

If using the estimate of some 200 yuan in costs per bus per day, the local government would need to fork out at least 3.6 million yuan a year to keep the 45 buses running, excluding human resources and other overhead costs.

In addition, driver Zhan revealed that another new fleet of route-7 buses would be introduced soon, thus in total, a minimum of 5 million yuan in annual spending was needed to support the initiative.

A professor from South China University of Technology, who specializes in China's public transportation reforms, said launching free bus rides against the backdrop of soaring fuel prices and ever-rising costs of transportation was a significant signal from policy makers.

He said many policymakers were torn between accelerating growth of the market economy or maintaining public services, adding that the free bus pilot in Changning would serve as a reference point.

Behind the Free Lunch
Previously, Changning's public buses were run by a shareholding company founded in 1998. Before the new policy took effect, the company was operating 11 routes, of which seven were within Changning downtown.

According to the City's public transportation management office chief Liu Jianguo, neither the local government nor the public were happy with the company's services.

Liu said as the company was only concerned with making profits, its operators had neglected public safety and social interests. For instance, he said, Chinese law stated that all public vehicles had a maximum on-the-road lifespan of eight years, and shall be scrapped thereafter. Yet, Liu said enforcers discovered the company continued to use 14 "aging and ailing" buses.

He said buses run by the company also often refused to stop for senior citizens and students, as these two groups of passengers were entitled to half-price policy. 

In addition, prior to implementing free public buses, the City was infested with illegal "public transportation" -- over a thousand of motorbikes and tri-motorcycles, and some 400 private cars fetching passengers commercially without permits. Though local law enforcement had attempted rounds of raids, such underground businesses persisted.

Liu said the municipal government realized that without intervention, transportation bottlenecks would spiral into social problems that would only burden authorities more down the line.

As a result, he said, the Changning municipal government decided to emulate previous experiences of waiving charges for water consumption and healthcare insurance for rural residents. However, the free public buses covered the entire city.

With the decision finalized, the municipal government immediately made an assessment of all the existing bus routes and evaluating available buses. In the end, it offered 40,000 yuan for each of the 50 buses fit for the road. Besides this, local authorities also bought 20 brand-new buses to improve service hardware and the level of comfort for passengers.

Based on official statistics, the municipal government had invested some 7 million yuan in the early stages to buy-over operation rights for three bus routes, and install new bus stops and other facilities.

Financial Support
However, some doubted the financial sustainablity of a free public transportation initiative. To the skeptics, Liu responded: "Since the local government has started it, we will follow through it and will not quit half-way."

Liu told the EO that funding for the project mainly came from three sources. First, the municipal treasury yearly budget of some 3 million yuan. Second, the income from advertisements placed on buses and bus stands was estimated to run into some 1 million yuan. Third, fuel subsidies from the central government amounting to 10,000 yuan per anum for each bus.

Changning has the courage to launch such an initiative partly due to its sound financial standing. The city is rich with natural resources such as lead, zinc, gold, copper, tin and coal, and its mineral reserves rank among the top in Hunan province.

In recent years, as prices for metals and minerals have surged, the local government has maintained a yearly income growth of some 100 million on average. Between January and May this year alone, the local treasury netted 280 million yuan worth of tax collections, or a 27.6% jump compared to the same period last year. The growth rate ranked among the top among cities in Hunan.

Thanks to the free public buses, the number of passengers have increased from 10,000 to 50,000 per day, squeezing the survival space for illegal transportation. Meanwhile, transportation authorities have estimated that the number of private vehicles (including cars and motocycles) on the road have dropped by 10,000 units per day.

The reduction in traffic flows, accroding to the local authorities, could help Changning city cut some 30,000 liters of fuel consumption per day.

Another unexpected change came in the form of social behavior, according to Liu. Liu said in the past, passengers on public buses rarely gave up seats to the aged, as passengers generally believed they deserved the comfort since they paid double for it compared to senior citizens.

After introducing the free rides, Liu claimed, passengers appeared to be more caring and the occurance of seats being offered to the aged have became more frequent.

Scholars have in general welcomed the move but also expressed apprehension. Hu Liege, professor from the communication school of Changsha University of Science and Technology, questioned the priority in providing public services.

He said in China, the reform in education and health care sectors were more pressing, and by turning public transportation into a free welfare service it could upset the balance in resource distribution for public interests.

One scholar who researches governance and political behavior at Sun Yat-Sen University pointed out that the Changning case was the extreme opposite of the public transportation model observed by Hubei province's Shiyan city, which opted for an absolute market economy.

He doubted both the models could be duplicated widely across the nation, instead, these models remained localized attempts, which revealed a local government's governance, capacity and its scope of management outreach.