Kazan to join federal experiment with public transport. Fares can increase

Urban transport’s level goes back to the state of housing utilities in the 2000s

Discussions of the project of the integrated public passenger transport upgrade programme through 2030 have been summed up in Moscow. According to the Russian president’s instruction, the project was designed by the Russian Ministry of Transport with VEB.RF and envisages upgrading 75% of the bus fleet and up to 25% of the electric transport fleet. As moderator of the forum, board member of the Russian Union of Industrialists and Entrepreneurs Igor Vdovin said, they received over 100 proposals from different regions of the country, and more than 800 applications were received to participate in the forum, though the union didn’t announce public hearings on the project of the programme.

However, the buzz around this grandiose project is already clear.

The federal authorities seem to have decided to solve a long-term problem of organisation of regular public transport traffic in cities for the first time since the 90s.

As Vice President of the Centre for Environmental Initiatives Pavel Chistyakov noted, urban transport is at a stage “housing utilities were in the 2000”, while “roads are that of the 2010s”, frankly hinting at the lag in the development of this socially important sphere and the general neglect of the problem in the country. “It means that nothing will work without direct federal support. No guarantees will be enough to upgrade public transport on a large scale,” he said indicating big accumulated damage in the sector.

The Russian Transport Ministry is offering to improve public transport by adopting a separate federal programme through 2030 with 620 billion rubles of federal funding (including public and private investments). Moreover, they want to raise its status to top level by including it to Safe and Quality Roads national project (Editor’s Note: this certainly guarantees federal co-financing).

It is assumed to make operational leasing the main tool to modernise the regions’ fleet and State Transport Leasing Company will be the operator of the programme.

5+, or who will join passenger transport modernisation programme

It is considered to do the experiment to create an effective public transport management model in six cities. They will join the future programme first. “From this perspective, 5+ scheme was offered for financing. Volgograd, Saratov, Yekaterinburg, Kazan, Nizhny Novgorod are these five cities. Plus, Tver. It is the cities that have ideas of using the model,” Vice Minister of Economic Development of Russia Andrey Ivanov who directly participated in the elaboration of the project of the integrated programme said.

10 Russian cities were named as participants in the future programme this July: Novosibirsk, Yekaterinburg, Samara, Chelyabinsk, Kazan, Nizhny Novgorod, Tver, Volgograd, Voronezh and Perm. While the costs of the federal budget were assessed at 750 billion rubles.

However, the first steps to upgrade the fleet of the cities were taken precisely this year. Russia’s Vice Transport Minister Aleksey Semyonov reported on how the regions were selected.

“In 2020, the Ministry of Transport began to provide state supporting measures to modernise transport in urban areas,” he said. “Regions went through a selection process when signing a leasing agreement with the operator of the programme State Transport Leasing Company. Within these state contracts, transport is supplied with a 60% discount of its price. The main requirements for a candidate are having a united plan for transport maintenance, optimal routes, an electronic fare payment system.”

According to him, 12 urban areas won the bid this year. They will be supplied over 500 pieces of land vehicles. It is 447 gas buses, 64 trolleybuses and other transport. So Kazan got 23 buses, Perm did 40, Belgorod — 58 buses, Omsk — 16 trolleybuses.

At the same time, the selection of urban areas for 2021 has ended. 15 won the bid. They will be supplied 392 vehicles. It is 275 gas buses, 104 trolleybuses, 13 tramways. Semyonov says that the new transport will be equipped with tachographs transmitting data in real time mode as well as a system monitoring the driver’s workability on the road.

“It was our condition to supply an integrated safety device. This smart device registers not only the driver’s working and rest time but also sends information about the speed regime. Moreover, it has a built-in mechanism controlling the driver’s mental and physical state. The device enabled to prevent accidents in Perm,” Aleksey Semyonov noted.

4bn rubles a year of limit through 2024

To ensure supplies run smoothly, the Transport Ministry is purchasing transport beforehand. The order is paid for this year, while the supply will be carried out next year. “This is also done to load the industry. This is why the budget financing is redistributed with Safe and Quality Roads national project,” Semyonov said.

At the moment, purchases of public transport are made within budget limits equal to 4 billion rubles a year. Due to budget restrictions, the limits will be in force through 2024, Semyonov said.

Demand is much higher. The regions’ applications have been 53 billion rubles this year and 63 billion rubles — next year, Semyonov provided the unpromising numbers and gladdened that it is meant to increase the amount to 26,4bn rubles a year from 2025.

Why is the Russian Ministry of Transport so concerned about public transport? As Aleksey Semyonov himself explained, this is caused by a rise in the amount of personal cars in cities, because of which the road network is overload and infrastructural problems arise. “This isn’t allowed because the load on the car road network of cities is growing, and authorities not always can solve these global problems,” he acknowledged. Nevertheless, 74% of the population regularly uses public transport, while accumulated problems don’t allow providing citizens with quality services, which decreases the attractiveness of this type of transport, the speaker stated.

How to attract money without state support

Vice Minister of Economic Development Andrey Ivanov who was one of the developers of the project added zest to the discussion at the plenary session.

“The state programme isn’t a reason to get public money. One should begin with not only the necessity to buy machinery but also the modern economically efficient public transport management model. If we set the task this way and create projects for this, it will turn out money will be found on its own. If we create a united payment system, an app where the passenger will see the travel time and the service is provided on time, financial flows will exceed the expectations,” he said metaphorically hinting that investors will be ready to invest if there is a guarantee capital will return.

The pool of pilots cities 5+ was chosen precisely to test the new scheme. “If an integrated service is provided in these five cities, the programme will allow purchasing 845 tramways, 700 trolleybuses, 5,400 buses. The amount of investments will total 241 billion rubles,” he said. “There will be created 25,000 jobs, 1,5 billion passengers will be transported in the five cities. You will be surprised but little is required from a perspective of state support. Everything depends on which model a region will choose — a gross contract or concession. Special support won’t be required here.”

So what are the sources of the programme? According to Ivanov, it is considered to subsidy rates according to concessionary agreements with money from the regional road fund. There is another option as well. Last week VEB.RF offered regions to take out loans, Ivanov said. In reply to this, the Russian Finance Ministry indicated that in such a model of financing the programme might be implemented only by those whose regional public debt against income is less than 50%. In this case, Nizhny Novgorod falls out of the programme.

“It won’t be so easy for Nizhny Novgorod Oblast to fit in the programme,” Andrey Ivanov noted. “But Tatarstan and Tver Oblast look attractive.”

Kazan to supply unmanned vehicles to public routes

He talked separately about Tatarstan. “Kazan maybe doesn’t look like the most successful example at first sight in terms of the low base effect to show results of the programme. Kazan has an effective public transport programme,” he noted. According to him, the city managed to test unmanned railway transport: “I am talking about the Big Kazan Ring, about Kazan metro where we can start using unmanned vehicles”.

Ivanov thinks that railway transport will need support: “Railway and contract infrastructure is very expensive and doesn’t pay back. It requires capital grants or get its rate of concessionary agreements subsidised. But the first estimates showed that this won’t need so much finance — from 5 to 10 billion rubles for these five cities. Of course, every Russian city would like to see itself in this programme. But the expansion is possible depending on what financial resources we will have,” the vice minister concluded.

However, it wasn’t discussed how fares in these pilot regions will change. Earlier, the Russian Transport Ministry hoped that a monthly travel pass shouldn’t exceed 7% of the average per-capita income in a specific region. The final decision will be made after the programme is approved.