Uber can’t save Ontario from its transit woes

OPINION: The province sees the sharing economy as a way to fill gaps in parts of Ontario that transit doesn’t reach. It should revamp its absurd bus rules instead
By John Michael McGrath - Published on Apr 11, 2017
The province's bus regulations are largely unchanged from the 1920s — but GO and Ontario Northland aren't subject to the same rules. (Ontario Northland)



Last week, Innisfil announced a partnership with Uber aimed at helping people who don’t have cars get around town. The municipality estimates subsidizing rides through the app-driven transportation service will cost $100,000 a year — instead of the $273,000 it would cost to run a bus, a figure that doesn't include the vehicle itself.

The move has been heralded as an example of how the sharing economy can improve access for people who live where transit doesn’t go, but the concept is nothing new: far-flung communities have always been tough to serve with conventional transit, and a number of cities have subsidized taxis. Toronto, for instance, subsidizes cab rides as part of its Wheel-Trans service, which accommodates riders with disabilities — it’s done so since the ’70s.

Innisfil can do what it likes with its transit planning, of course. City council will give Uber a shot, see whether it works out, and re-evaluate next year — and that’s fine. Either it will succeed or it won’t, and nobody outside of Innisfil needs to worry much about it.

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The greater concern here: the province is also looking at new ways of moving people, and specifically at revamping its intercity bus regulations. It’s also making noise about finding new ways to use ride-sharing companies such as Uber and Lyft.

It’s certainly true that Ontario’s bus rules need a rethink, as the current system is largely unchanged from the 1920s. In order to run a scheduled bus service, companies need permission from the Ontario Highway Transport Board. But the board won’t give Company A permission if the proposed route is already served by Company B — which means legal monopolies for a small number of companies. (Where have we seen this before?)

As it stands, bus companies are supposed to cross-subsidize service in rural areas. In other words, revenues from lucrative routes such as the Ottawa–Toronto run are meant to help defray the costs of serving remoter places — a policy that might be defensible if it actually worked. But the tradeoff isn’t laid out in Ontario law, so there’s nothing stopping, say, Greyhound from cutting service in the north while continuing to enjoy the profits of its core routes in the south.

The government has been talking about changing its intercity bus rules for years now: in a 2010 report, the Ontario government endorsed the principle of introducing greater competition to the industry, but nothing ever came of it. Last summer, the government  issued a discussion paper on the subject. It called for a list of recommended changes to be produced sometime this year, but the Liberals don’t have anything ready for show and tell yet.

“What we continue to hear loud and clear from these communities is that we absolutely need to get this right,” wrote Kari Cuss, spokesperson for Transportation Minister Steven Del Duca, in an email. “So while we don’t have an exact date for delivery, we do expect to have more to say on this in the near future.”

Caution is fine, even advisable. Northern and rural municipalities are rightly concerned that wholesale deregulation could see service in isolated communities suffer, and that poses its own policy problems (like how to get those people to bigger cities for specialized health care).


Yet even as the government exercises caution, it can’t help but muse about “exploring opportunities that could be afforded by the sharing economy” and what that might mean for buses. And there are always risks when policymakers become infatuated with new technologies. For one thing, it’s not clear that companies like Uber will actually be around to accommodate long-term transit planning: the marquee ride-sharing company is losing billions of dollars annually according to Bloomberg News. (Indeed, that might explain why a company that touts itself as a brash innovator is so eager to make taxpayer-funded transit deals.)

It’s one thing to allow ride-sharing companies to operate; it’s quite another to base provincial transportation policy on them. The 2016 discussion paper ponders using them as a “last mile” solution that gets people from their homes to bus stops — but that won’t work everywhere. The same limitations that make it difficult to run buses in remote areas will apply to ride-sharing programs: there just aren’t enough people around.

Clearly the status quo isn’t working for Ontarians. While some northern and rural communities continue to deal with precarious bus service, others are losing it entirely — and blue-sky notions about Ubering around Temiskaming aren’t helping anyone.

The government would do well to remember that it owns and operates two bus services not subject to its bizarre and outdated rules: GO and Ontario Northland. If the province is truly concerned about filling the gaps private operators won’t, perhaps they should do it themselves.

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