Government sources even confirmed that the publications in “Calcalist” revealed to the government an unflattering picture that they were not aware of and that they were a catalyst for reform.
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As part of the reform, the gap in tariffs between payment in the app and the multi-line card will be eliminated. The reform is expected to take effect this summer, but no specific date has been set.
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Transport Minister Merav Michaeli at a press conference in Jerusalem announces “equal way” reform
(Photo: Amit Shabi)
The Ministry of Transportation wants this to take effect before the start of the school year. The reform does not need the approval of the Knesset or the plenum committees because it is under the responsibility of the joint pricing committee of the Ministries of Transport and Finance, and the chances of it being torpedoed are low.
The tariff reform includes the unification of tariffs throughout the country, with a single bus or light rail ride in any locality in Israel for a range of 15 kilometers costing NIS 5.5 and allowing unlimited transitions between lines for 90 minutes. A regional bus ride (up to 40 km) will cost NIS 12, an intercity ride (up to 120 km) will cost NIS 16, a more distant ride will cost NIS 27. Eilat lines will have separate fares.
The reform also applies to combined bus travel along with heavy rail service: a single urban / local train ride in any locality in Israel will cost NIS 9 and allow unlimited transitions between lines for 90 minutes at an air distance of up to 15 km for travel from the point of ascent. Up to 40 km) will cost NIS 18, intercity travel will cost NIS 24, intercity (up to 120 km) will cost NIS 27, further travel will cost NIS 48. Eilat lines will have separate fares.
Free monthly for the entire country will cost NIS 225, not including the Eilat and Arava lines. In the peripheral localities, it will be possible to purchase a free monthly ticket in the amount of NIS 99 for a travel distance of up to 40 km. According to the reform, the localities that will not be entitled to this discount are all localities in Gush Dan The option of free nationally for NIS 225. In addition, for the first time, children and youth (ages 18-5) will be able to purchase monthly free tickets, which will be at a 50% discount. And all the children will be able to purchase a free national monthly for NIS 112.5.
Apart from children and youth, retirees and Social Security beneficiaries will also receive a 50% discount on individual trips and also on monthly leave. The discount for people with disabilities will rise from 33% in the past to 50% with the introduction of the reform. Adults aged 75 and over will travel for free, and Finance Minister Lieberman said he intends to act so that in the next budget other senior citizens (over the age of 62 for women and 67 for men) will also be able to travel for free on public transport.
For the first time, the reform will also include the option of paying by credit on public transport lines, in contrast to the current situation where it was only possible to pay with a multi-line card or payment applications. The pilot is expected to start operating at Dan, and in the initial phase, payment by credit card will not allow for individual discounts due to technological gaps.
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bus
(Photo: Yuval Chen)
There are several key principles behind the tariff reform. The first is the unification of tariffs designed to put an end to the fact that specific areas in Israel receive exceptional discounts compared to other areas and the fact that there is a separate pricing mechanism for multi-line users and payment app users. The lack of uniformity in fares meant that in Beit She’an they paid three times more for travel tickets than in Tiberias, and that residents of Petah Tikva, Modi’in Illit, Netanya or Rehovot received exorbitant discounts compared to other cities for no justifiable reason. Finance Minister Lieberman said that “this time there is one criterion for price: mileage.” Despite Lieberman’s firm statement, the reform still set a rebate for peripheral residents on the monthly leave. The unification of prices is also intended to simplify the calculation of the price by the passengers, but the very fact that the Ministry of Transportation has launched a “travel price calculator” indicates that the current formula is not very simple and clear either.
The second main principle behind the reform is the preference of regular users. The reform, which emphasizes arrangements such as monthly free, is intended to lower the price paid by regular passengers on public transport at the expense of occasional passengers. The Ministry of Transportation clearly states that they are interested in creating a “perceptual change” that rewards the passengers and regular passengers in public transportation in order to encourage unlimited use of it.
Ministry of Transportation Director General Michal Frank told Calcalist that “first of all we wanted to change the structure of the incentives, the money will go to those who make regular trips on public transport and may allow at least one more car for the family.” They say – drive more and it will pay you more. We are moving to an attractive subscription price. “
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Finance Minister Avigdor Lieberman
(Photo: AP)
The reform itself has no additional budgetary cost, and along the way it is expected to absorb the increase in public transport tariffs that was planned to take place following the rise in fuel prices, a 9% increase in the price halted by the finance and transport ministers. Government officials told Calcalist that the possibility of subsidizing the older passengers and creating additional discounts for new populations was made possible thanks to the cancellation of the historic arrangements and the unusual discounts.
The subsidy rate for public transportation is 70% on buses, and 68% on light and heavy trains. Thus, for every bus ride that costs NIS 6 per passenger, the state subsidizes an additional NIS 12. The budget for subsidizing public transportation in Israel this year is about NIS 12 billion, and this is expected to increase to an annual amount of NIS 15 billion by 2026. According to Frank, the revenue for public transportation operators is not expected to change due to the reform. Cash for drivers and will lead to an increase in validity.
The main losers of the reform are of course the residents of the cities where there were the same historical assumptions, who will now have to pay the same price to the rest of the country. Also, the model that incentivizes the frequent flyer will cause the price for the casual traveler to rise, but providing the option to pay on credit will allow more people to enter the circle of casual travelers.
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Michal Frank, Director General of the Ministry of Transportation
(Photo: Linkedin)
On top of that, some regular users of heavy rail services will now have to pay higher prices. This is because now there will be a separation between monthly free and daily free fares that include train service to bus fares only, and those that include the train will be more expensive. However, even if some passengers have to pay more, public transportation in Israel will continue to be heavily subsidized and still be the cheapest alternative by a large margin compared to the private car: the price of a nationwide free monthly is expected to be cheaper than a one-time refueling of 35 liters of 95 liters of 95 gasoline. In the context of canceling the historical discounts and service to the periphery, Frank told Calcalist that “in those places where the options are different, the distances are longer, maybe the public transportation is not as frequent as we would like, so we give an excellent product for NIS 99. 40 km “They cover exactly the driving patterns as we analyzed them: people from Netivot travel to Sderot, Be’er Sheva, and this covers most of their travel ranges.”
Frank further told Calcalist that “our biggest ambition is to see a consistent increase in the use of public transport. If we see an increase in the number of subscribers or an increase in the number of passengers – this is our biggest success.”
Despite the optimistic statements, the main problem of public transport in the country has never been price but quality, so although the reform seems important and positive, in order to attract new users the service and frequency of lines must be significantly increased. To do this, the Minister will need to create preference routes for public transport that will make bus travel fast and affordable and increase the wages of bus drivers so that thousands of more drivers can be recruited and passenger service improved.