Article citation information:
Prieto-Rodriguez,
G., Garcia-Bedoya, O. Public transportation system fare, economic impacts on
the purchasing power of its users, the case of Bogotá, Colombia. Scientific Journal of Silesian
University of Technology. Series Transport. 2024, 123, 245-257. ISSN: 0209-3324. DOI: https://doi.org/10.20858/sjsutst.2024.123.12.
German PRIETO-RODRIGUEZ[1], Olmer GARCIA-BEDOYA[2]
PUBLIC TRANSPORTATION SYSTEM FARE, ECONOMIC IMPACTS ON THE PURCHASING
POWER OF ITS USERS, THE CASE OF BOGOTÁ, COLOMBIA
Summary. The
public transportation fare in a city is an important determinant of
accessibility, equity, and quality of life for its citizens. This article makes
a comparative quantitative analysis of the fare of the public transportation
system in the city of Bogotá (Colombia), its evolution over time, and
the impact on the poorest users. It compares with similar systems in Latin
America and other cities in the world. The findings show that the fare has had
high growth in US dollars (USD 0.38 in 2000 to 0.75 in 2024), but the
purchasing capacity has increased with respect to the local minimum wage (10.84
tickets with a minimum daily wage, versus 14.69 in 2024). This rate is one of
the highest in Latin America and has a high impact on lower-income citizens,
since the purchase of 50 monthly tickets is equivalent to 15% of the local
monthly minimum wage.
Keywords: public
transport, bus transit, fare, Bogotá
1. INTRODUCTION
1.1. Background
Public transportation
is considered a sustainable means of transportation and the most viable
alternative to replace a significant fraction of medium and long-distance trips
made by private automobile [1] and motorcycle [2], whose accelerated growth
aggravates the problems of congestion [3], pollution [4] and traffic accidents
[5]. But at the same time, public transportation is also the main mobility
alternative to access medium and long distances for low-income citizens,
especially in cities in developing countries [6].
For these low-income
citizens, the fare becomes more important because if the ticket to access
public transportation is very expensive, they will not be able to pay it [7] or
they will have to incur an expense with a high impact on their economic income
to be able to afford the transportation service [8]. Since the public transport
fare has such a high relative weight compared to household income, decisions
involve making fewer trips, with the consequent reduction in accessibility, or
making excessively extensive trips on foot or by bicycle [9]. In some cases,
these high transportation expenses also lead citizens to choose to purchase a
motorcycle as a means of daily mobility, which does not consider hidden costs
such as increased risk of traffic accidents [10].
In the city of
Bogotá (Colombia), for more than two decades, when a process of
reorganization of the public transportation system towards a formalized and
centralized scheme began, citizens have criticized the amount of the access
fee, this being a recurring theme in the discourse of local politicians and
various opinion generators (see, for example, [11]).
However, few academic
studies have analysed the way in which the city's public transportation fares
have impacted the city's poorest population throughout its history, both in
comparative terms with other cities in the context and relative to the levels
of income.
1.2. The Integrated Public Transportation System of
Bogotá
In the last two decades, some Latin American cities have undertaken
different efforts to modernize their public transportation systems, mainly in
search of achieving formalization of the service, a reduction in the generation
of externalities such as air pollution and traffic accidents, an improvement in
the working conditions of the sector and the quality of service for users [12].
This is the case of the city of Bogotá, Colombia, which began a process
of progressive transformation in 2000 to migrate from a semiformal system to a
completely formalized one, whose structure contemplates the planning,
management and control carried out by the public sector and the operation of
vehicles and collection systems by private companies [13].
This process of change began with the implementation of the TransMilenio
System, a high-capacity Bus Rapid Transit or BRT type system [14] that
transformed the provision of the city's public transportation service. Starting
in 2009, Bogotá expanded the scope of this transformation towards a
model aimed at having total coverage of the city, through the implementation of
the so-called Integrated Public Transportation System (SITP). The SITP includes
the trunk component (i.e., TransMilenio) and the zonal component, consisting of
buses with a lower capacity than those of the zonal component, which seek to
have coverage in all sectors of the city. That is, a total system that by 2022
had 2,365 articulated and bi-articulated buses and 8,557 zone and feeder buses,
to cover a city of approximately 8 million citizens, whose total travel demand
was calculated for 2023 at 14.6 million daily trips, of which 4.4 million
(30.3%) were carried out by public transport [15].
The organizational structure of the SITP is based on a public-private
operation scheme [16], while the entity that plans, manages and controls it is
TRANSMILENIO SA, a 100% public district organization, of an industrial and
commercial nature of the State (that is, it must manage its own operating
resources), which contracts private companies that are responsible for the
operation of trunk buses, zone buses, collection and fiduciary management of
resources [17].
Regarding
its tariff scheme, the TransMilenio System began its operation under a
Colombian legal framework that prohibited the transfer of resources to
subsidize the tariff. As was the case with the rest of the collective and
massive public transportation of passengers in the country, the regulations
made explicit that this type of service had to be
“self-sustainable”, in such a way that the financial income
generated by the tickets sold had to be equal to the operating costs of each
system (Law 086 of 1989 and Law 310 of 1996). This scheme was maintained after
the operation of the zonal component of the SITP began, despite the fact that a
lack of resources began to be generated that has progressively increased.
Subsequently, this “self-sustainability” restriction was modified
by Law 1753 of 2015, but the sources of resources to generate permanent
subsidies for the operation of the system are still unclear, as has happened
with the rest of the public transportation systems in Colombia.
The
result for user perception would be a comparatively expensive and poor-quality
public transport system [18]. At least this is reflected in the citizen
perception indicators, with values of disapproval of the service of 81% of
those surveyed and where 60% consider that the system continues to worsen
compared to the previous year [19]. In the same way, many users consider that
the Bogotá public transportation rate is one of the most expensive in
Latin America and that the cost of this ticket has risen wildly since its
creation, to the detriment of the purchasing power of citizens and to the
benefit of the system's businessmen [20]. This perception has progressively
expanded to the entire SITP, including the zonal component, with the perception
of high cost being the main topic of this article.
1.3. Fare structure of the Integrated Public Transport
System
2.1. Performance measurement and its importance
Studies such as those
by Verbich & El-Geneidy [23], Mladenovic [24], Guzman & Hessel [25] and
Saeid & Chowdhury [26] address the problem of the high impact of public
transport fares on the precarious resources of the poorest. If the low payment
capacity is also combined with the displacement that lower-income people
usually suffer in large cities due to high land prices due to socio-spatial
segregation phenomena, the result is that this segment of the population will
have less accessibility to their basic needs, such as health, education,
employment and recreation, among others [27].
This concept of
accessibility can be assumed as “the
ease with which each person can overcome the distance that separates two places”,
but more broadly it can be understood as the ability to reduce the physical and
economic distance towards centres of opportunity for people. “Access, mainly economic, to transportation
networks, in turn implies access to opportunity structures” [28].
Mobility (and in this
case, access to public transport) becomes a requirement or necessity to cover
those difficulties that citizens have in reaching the place where they find the
supply of goods and services they require, since “Today, mobility is a
key condition for access to the labour market, housing, education, culture and
leisure, and family. The right to work, to have a home, to receive training,
now implies the right to mobility (…) in a certain sense, this right to
mobility is a precondition of the other rights” [29].
This situation is
particularly complex for the context of Latin America, taking into account that
a high percentage of the population belongs to low socioeconomic strata [30]
and, therefore, the conditions of inequality are aggravated by not being able
to access offer of education, employment and health, among others. This is
reflected in the preparation of several studies at the Latin American level
that show how the confrontation between the ability to pay, and transportation
costs generates accessibility problems, such as Bocajero & Oviedo [31] and
Estupiñan et al. [32]. In fact, these phenomena related to the
geographical location of people based on their income, the affordability or
possibility of paying for transportation services by these citizens and the
needs and characteristics of the trips made by them are generating the trend of
creating their own fields of study, such as the sociology of mobility, urban
sociology and the sociology of
transportation [33].
This article reviews
the evolution of the fare of Bogotá's public transportation system in
absolute and relative terms in the period 2000-2024. It analyzes different
impact indicators on the income of the low-income population and makes a
comparison with the fare levels of other public transportation systems in Latin
America.
In the first part,
the main characteristics of the Bogotá Public Transportation System, its
operating structure and the impact it has on mobility in the city of
Bogotá are presented. Subsequently, an analysis of the historical
evolution of the fare is presented in comparative terms, both in constant
pesos, in dollars and in the relationship between the cost of the ticket vs.
the local monthly minimum wage. In a third part, a comparative analysis of the
fare of the Bogotá system with respect to the public transportation
fares of other Latin American cities is presented. Finally, some
conclusions about the results are presented.
3.1. Data collection
Secondary data were
collected from the websites of the local governments or of the operating
entities of the public transport systems in each city. Exchange rates, minimum
wage amounts and other data were taken from official sources at the date of
preparation of this document (February 2024). Reports, journals, and books were
also used as data sources for the research
analysis.
4.1. Fare evolution
At the beginning of
operation of the TransMilenio System in 2000, its fare was defined at COP$800
(USD$0.38 of that year), an amount that historically remained above the cost of
the traditional collective transportation fare by up to 20%, until the total disappearance
of the latter. The rate has been increasing relatively constantly during the 18
years of operation of the system at an average rate of 5.7% annually, as seen
in Figure 1.
It can be seen in the
graph that there is only one “valley” in the rate trend towards the
period between 2011 and 2015, which coincides with the period of Gustavo
Petro's mayoralty in Bogotá, who undertook efforts to avoid increases in
the rate and to apply subsidies differentiated by age, disability status and
situation of vulnerability (included in the SISBEN System for identifying
citizens in precarious conditions). In addition to a rate reduction in
'off-peak hours', which sought to distribute more efficiently demand throughout
the day. However, due to the contractual structure of the rate and the lack of
permanent resources to maintain demand subsidy levels, starting in 2016 a
“correction” had to be generated that sought to balance the
financial situation of the system, which was shown both in the increase in the
full rate and in the reduction of subsidy levels for vulnerable groups and the
elimination of the off-peak hour subsidy.
Fig. 1. Evolution of the Bogotá public transportation system fare
in current pesos
Own elaboration with data from TransMilenio SA
Fig. 2. Evolution of Bogotá public transportation system in
American dollars
Own elaboration with data from TransMilenio SA
In order to analyse
these rates in terms of purchasing power, figures 2 and 3 show the evolution of
the cost of the ticket measured according to the exchange rate of the Colombian
peso with respect to the US dollar and in relation to the minimum daily wage.
The evolution of the
rate in US dollars has remained mainly tied, as expected, to the peso-dollar
exchange rate, although in general terms it has had significant growth during
the 18 years of operation of the system. This is how in its first 4 years the
full rate had a cost close to 40 cents on the dollar, while for 2018 and 2019
it has doubled its value towards 80 cents, with maximum values in the period
2010-2014 higher than 90 cents (due to exchange rates lower than COL$1,900 per
dollar between 2010 and 2013). Regarding the subsidized rates, it can be seen
that they all had an accelerated reduction since 2012, even reaching 33 cents
on the dollar in the case of the SISBEN rate. For 2019 they are between 46, 58
and 69 cents (Disabled, SISBEN and senior citizens, respectively).
To better visualize
the way in which the ticket purchasing capacity has evolved over time, Figure 3
presents a relationship between the number of tickets that can be purchased
with a Colombian daily minimum wage in each year. It can be seen that the
purchasing power with respect to the full fare has remained very similar, going
from 10.84 tickets in 2000 to 11.50 in 2019, with minimums close to 10 in the
period 2002-2011 and with maximums between 2013 and 2016 close to 12 tickets.
Regarding the
purchasing power of tickets by the subsidized groups, we see how the group of
citizens with SISBEN had an accelerated increase between 2013 and 2016,
reaching a maximum of close to 24 tickets per day and balancing out towards
2017 in 15 daily passages. As for the elderly, they have maintained their
purchasing power between 12 and 13 tickets since 2013, while citizens with
physical disabilities have had constant growth since 2011, going from being
able to buy 11 tickets with a daily minimum wage to 19.
Ticket costs data
were collected from the websites of the local governments or of the operating
entities of the public transport systems in different Latin American cities.
For this, the “full” fares were taken into account, being those
corresponding to the cost of a single ticket, as well as the discounted fares
for the social groups of the elderly, disabled, students and those of lower-income
citizens (called “social”).
For the purposes of
the graph, other types of discounts are discarded, such as those for off-peak
hours and ticket package purchases, and it is clarified that all systems have
special peculiarities, such as that some have integrated rates and others do
not, some discounts are applied for a certain number of tickets or with other
types of restrictions and in some cities the cost of the ticket is different
for different modes of transportation, among others. The compendium was carried
out in February 2024 and the exchange rates of each currency to the US dollar
in force on that date were used.
As shown in Figure 4,
rates in Colombia are between 75 and 93 cents per ticket, which is why they
would be the highest in the Latin American context after Brazilian cities and
the Santiago metro, whose tickets are in values close to or greater than 1 dollar.
The full TransMilenio
rate is equivalent to USD 75 cents, while that of older adults and lower-income
citizens is 64 cents. Citizens with physical disabilities are assigned a
monthly equivalent of money on their card, for which a cost equivalence per
ticket was made if the user made 50 monthly trips, resulting in a cost of 60
cents per trip. This means that the full fare would be 76% more expensive than
the Buenos Aires metro and approximately triple that of public transportation
in Quito and Mexico City.
Fig. 3. How many tickets can be purchased with a minimum daily wage?
Own elaboration with data from TransMilenio SA
To review these
figures in relation to local purchasing power, a relationship was made between
the equivalent cost of 50 monthly tickets (which can be considered a reasonable
number of trips for daily reasons) and the local minimum wage, the results of
which are summarized in the Figure 5. The result shows that in Colombian cities
this ratio ranges between 13% and 15%, which is well above the standard recommended
by the CAF of 6%. “If one considers
that the desirable situation would be that the value of 50 fares does not
exceed 6% of the minimum wage, it is possible to conclude that in most cities
this relationship limits the mobility of people” [32].
Fig. 4. Mass public transportation rates in Latin American cities. Own
elaboration with data from official pages of the public transport systems
retrieved in February 2024
A structural
component of the rates charged to the user is the percentage of the technical
rate or real costs per passenger that are covered by State subsidies. That is,
the difference between the cost of transporting a passenger (technical rate)
and the charge made for entering the system, which are usually covered with
funds from the taxes of the city or the country, or by specific destination
resource sources. Latin American cities have very different levels of public
transportation subsidy, ranging from 71% of the operating cost in Buenos Aires,
to cities such as Belo Horizonte and Porto Alegre that subsidize less than 6%
of that fare.
In most Colombian
cities, no operating subsidies have been defined, with the exception of those
already stated in TransMilenio and a subsidy for students in the Pereira
Megabús System. It is estimated that the average subsidy in the main
cities of Latin America is close to 50% of the money collected for tickets,
while our own calculations show that for Bogotá this amount would be
close to 9.2%.
The high cost of
public transportation would be generating three main effects. The first of them
is a growing attraction for more and more users to be willing to switch from
public transport to private cars and motorcycles. This is aggravated because,
according to the CAF (ibid), the cost of traveling 7 kilometers by public
transport in Bogotá is very close to that of traveling by private car
(close to USD 0.70) and much higher than that of a motorcycle (approximately
USD 0.35). The second factor is the diminution in the purchasing power of
individuals using public transportation as a result of the expenditure required
to travel, as it is estimated that the'very poor' population allocates more
than 17% of their income towards transportation. And the third, related to the
previous one, is the impact on citizens who must stop making trips because they
do not have sufficient resources to pay the fare. According to the
Bogotá Mobility Survey, lower-income citizens make an average of 0.9 motorized
trips per day, while those with higher incomes make an average of 2.01 trips of
these characteristics.
Fig. 5. Ratio of the cost of 50 public transport fares to the local
monthly minimum wage. Own elaboration.
Public transportation
in the city of Bogotá continues to have a high participation in the
city's total trips, representing more than 30% of total trips and more than 50%
of motorized trips in the city. This, despite the fact that the entrance fee to
the public transportation system is among the highest in Latin America, along
with the Brazilian cities, Santiago de Chile and Montevideo and very on par
with other Colombian cities. On the other hand, it is important to highlight
that there is an important difference in the comparison with these last cities.
In most of them, higher levels of subsidy are provided for specific
populations, such as the case of very cheap or even free rates for people of
low income such as the elderly (as in the case of Sao Paulo and Rio de Janeiro)
and students (free in Buenos Aires and Rio de Janeiro, and very cheap in cities
such as Rosario, Sao Paulo, Santiago, Quito, Mexico City and Panama).
Both the possibility
of offering these discounted fares and offering cheaper full fares is largely
related to the amount of resources that each city and country contributes with
respect to the cost of moving each passenger, that is, the fare subsidy. It is
found that the city that offered the most subsidies was Buenos Aires (currently
in a process of gradual dismantling), followed by cities such as Panama,
Caracas, Rosario and Santiago, which subsidize more than 30% of the
“technical rate”. In the city of Bogotá, in practice, an
amount of subsidy would be given that would be close to 9%, which would place
it among the cities that generate the least contributions from the State to
cover the operating costs of its public transportation.
Moving on to an
analysis of its historical evolution, when the Bogotá SITP rate is
analysed in US dollars, it is found that in the 24 years of operation it has
grown almost double since the creation of the trunk component of the system
(USD $0.38 in 2000 to $0.75 in 2024). However, this fare would have increased
its affordability for people with lower incomes because while in the year 2000
a daily minimum wage would be enough to buy 11.50 tickets for the system, in
2024 that salary would be enough to buy 14.69 tickets, which it represents an
increase of 35%, an increase that has become more pronounced since 2020 thanks
to a moderate increase in the rate and a high increase in the Colombian legal
minimum wage.
The results of this
study could be complemented with an analysis of the impact that targeted
subsidies have had on the beneficiary population and the possible impacts of
deepening measures in this regard, whether by increasing the amounts of the
subsidy or expanding it to other types of populations. This could complement
works such as those of Guzmán et al. [34], who analyze the price
elasticity of off-peak discounts that were applied in the system between 2012
and 2015, or that of Bocarejo & Oviedo [31] who analysed the impact of a
redistributive rate with respect to accessibility in Bogotá. From this,
a relationship of benefits and social costs of the implementation of this type
of subsidy in the Colombian capital can be calculated, with a view to analyzing
possible similar measures in the future.
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Received 02.03.2024; accepted in
revised form 27.05.2024
Scientific Journal of Silesian University of Technology. Series
Transport is licensed under a Creative Commons Attribution 4.0
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[1]
College of Faculty of Economic and Administrative Sciences, Jorge Tadeo
Lozano University, Bogotá, Colombia.
Email: german.prieto@utadeo.edu.co. ORCID: http://orcid.org/0000-0002-7475-6914
[2]
College of Faculty of Engineering, Jorge Tadeo Lozano University,
Bogotá, Colombia. Email: olmer.garcia@utadeo.edu.co.
ORCID: http://orcid.org/0000-0002-6964-3034