Greyhound bus lines recently announced that they would reduce and terminate bus service to small towns in Manitoba and Northwestern Ontario. They also implied that they were reviewing bus services to small towns in Alberta. Saskatchewan isn’t mentioned because bus service to small towns is run by the provincially-owned bus line Sask Transportation Services. No one doubts that this move by Greyhound is a blatant political move to see if it can extract some subsidy dollars from assorted provincial governments. It has a good case.
Many years ago Greyhound cut a deal with provincial governments that they would maintain bus service to small towns in exchange for restricting competition on their profitable inter-city routes. I guess that is the Canadian way – it has worked through internal company cross-subsidization – but costs have become prohibitive and another way has to be found.
Costs are not insignificant – a high-tech commercial highway bus nowadays costs well in excess of half-a-million dollars. Fuel and maintenance are a continuous cost, and of course, ever increasing are the labour costs. Greyhound could well juggle those costs between routes, but it is faced with severe competition from folks using their own cars, and airlines desperate to fill plans between the main cities with give-away airfares. All of that works against any bus company.
One could be cold-blooded and state that this situation is the result of supply- and-demand and let the marketplace rule. If people are not prepared to use the bus service – then let it die. That’s a realistic perspective, but we need to remember that citizens and where they live need to be treated equally. Just because you live in smalltown Overshoe, Alberta rather than in big city Calgary, Alberta does not mean you should have different access to government services and subsidization thereof. Citizens in both locales pay the same taxes – so should receive the same benefits.
Urban residents are able to use a public transit service that costs billions of taxpayer dollars to build and maintain. Most of that tax money comes from taxpayers from every part of Alberta. Folks living in the city feel that such lavish transit is their right and woe to any politician who dares question spending the billions on city transit systems. It would never occur to any transit user, nor our political representatives that city transit systems should actually pay their own way. Fares would have to quadruple to even come close to paying for the true capital investment and actual operating costs. But that won’t happen, politicians know where the votes are and they are not going to antagonize city voters with financial reality when it comes to transit.
Past governments knew all that and in the case of rural bus service there was an obvious resolution. As the service was private, it was just a matter of giving the provider a bit of a monopoly in order to subsidize service to small towns. But times have changed.
The reality now is that with ever-increasing costs and competition on its main source of revenue, Greyhound can no longer maintain money-losing services to small towns. It would seem that now governments also have to face the same reality and consider providing the same transit subsidy it provides to urban transit systems to rural and small town bus service. They got off the hook in the past by providing a monopoly to the operator – but times have changed.
Perhaps the operator can streamline services – three times a week service instead of daily etc. But clearly a subsidy is justified – perhaps in the purchase of capital items like new buses – after-all your tax dollars buy multi-million train cars in Calgary and Edmonton. There would be many ways to provide some assistance.
One could also raise the green aspect to subsidizing bus service – after-all more bus service should take more cars off the road. It also provides a social benefit – cheap and accessible bus service provides a service to low-income folks in cities and small towns.
From a more personal perspective, the possible demise of bus service to small towns reminds one of the loss or railway train service to small towns in the not too distant past. Governments allowed and even encouraged that to happen – that may have been a mistake if the expanding rail services in Europe are any example. Bus service should be considered a vital public service. Our neighbors in Saskatchewan knew that many years ago – that’s why they have a publicly-owned bus service to rural areas – perhaps there is something to be learned from their experience.