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UNU-IAS Working Paper No. 168
Policy Elements to Upscale the Contribution of
Urban Transit Initiatives on Sustainable Urban Transport:
The Case of Bus Improvement Initiatives in Indonesia
Puspita Dirgahayani
February 2012
Abstract
Promoting public transport use is one of the entry points towards sustainable urban transport,
on the condition that the public transport system is planned and developed in a sustainable
manner. This study develops a conceptual framework, based on a critical review of transit
policy elements, to ensure sustainable urban transit projects. The framework is applied to
review the progress of bus improvement initiatives in Indonesia, by looking at four cities as
case studies. The analysis suggests that the integration of transit policy instruments (physical
and “soft” measures) and regulatory reform to create a cost-effective transit industry is
essential in gaining larger benefits from urban transit projects.
Keywords
public transport governance, bus system, regulatory reform, sustainable urban transport
1
1. Introduction
A well functioning and efficient public transport system is an important element in building
sustainable urban transport (SUT). It falls into the “shift” strategy of the holistic “avoid-shift-
improve” policy framework for achieving SUT (see Dalkmann and Brannigan, 2007). In
order to achieve greater impact, ideally, the “shift” strategy should be integrated with the
other two strategies. However, in developing countries where in most cases transit systems
are poor and have not adequately served their cities, it is quite challenging to prevent public
transport users from leaving public transport and shift to private modes. Given this
consideration, this study argues that making a transit system stand out among other transport
modes can be realized on the condition that the public transport system is planned and
developed in a sustainable manner.
This paper aims to review the progress of public transport improvement projects in Indonesia
as the first step to evaluate their sustainability. It looks at bus improvement initiatives
implemented in four Indonesian urban areas as case studies: Jakarta Metropolitan Area,
Greater Yogyakarta, Palembang City and Bogor City. The rest of the paper is organized into
four sections. The following section provides a critical review as the basis of the paper to
develop a framework conceptualizing transit policy elements that would ensure a sustainable
public transport project, which will be covered in the third section. Finally, it concludes with
lessons learned both specifically for sustaining the whole bus improvement project in
Indonesian cities and generally for other developing cities.
2. Delivering a Sustainable Urban Transit System: A Literature Review
The sustainability of urban transit system covers the entire span of input (transit policy
instruments), process (how transit is governed: the regulatory framework), and the
materialization of direct and indirect benefits (Takyi, 1993; Gwilliam, 2008). If these
elements are well considered from the initial stage of project implementation, urban transit
system improvements can be carried out cost effectively.
2.1 Transit Policy Instruments
There are generally two types of policy instruments adopted in the transport sector: physical
and “soft” measures (Steg and Tertoolen, 1999; Santos, Behrendt and Teytelboym, 2010;
Bamberg et al., 2011). The former measures modify the objective environment, which
includes the provision of public transport infrastructures and services, while the latter alter
both users and non-users’ perceptions towards the objective environment, or the complexity
of taking transit trips.
2
2.1.1 Physical Measures: Transit Technology and Network Design
Cities with good transit planning generally make use of a greater variety of modes forming a
citywide transit network, since each mode type satisfies certain capacities and functions as
listed in Table 1. The network design affects customers’ satisfaction regarding travel times,
travel cost, comfort and safety (Vuchic, 2005). Both chosen technology and network design
should serve the municipal’s vision of its city development, influence the city’s economic
efficiency, secure its social equity, and, most importantly, also dramatically affect municipal
finances (Wright and Hook, 2007; Tang and Lo, 2008).
Table 1 Comparison of Public Transport Technology Options
Technology
System Capacity
(passenger per
hour per day)
Amount of
Investment
(million
USD/km)
Energy Source
CO2 Emissions
Reduction
Potentials4
Heavy Rail: Underground
Metro, Commuter Rail and
Elevated Rail1
30,000–80,000 45–350 Electricity,
Diesel
64–75%
Light rail transit (LRT)2
10,000–30,000 15–45 Electricity 57%
Bus Rapid Transit3 3,000–45,000 0.5–14 CNG 0–10%
Hybrid-electric 5–20%
Fuel-cell 30–75%
Conventional Bus Services 500–5,000 n/a Diesel, Natural
Gas, Hybrid
32%
Note: 1e.g. monorail and maglev train technologies
2LRT is electric rail-based technology operating at the surface level. Trams can also be considered a type of
LRT but typically utilize smaller-sized carriages 3Rubber-tired vehicles running on dedicated right of way (ROW) for all or part of a transit route. There are
various types of BRT systems (see Levinson et al., 2003; Wright and Hook, 2007) 4
In the case of heavy rail, LRT and conventional bus, the emissions reductions are compared to private car
based on estimated CO2 emissions in pound/passenger-miles, with 40% load factor (FTA, 2009). As for the
BRT, based on estimates of total CO2 emissions reduction (tonne over 20-year project life) (Wright & Fulton,
2005).
The other consideration in choosing transit technology is its potential in reducing emissions
— both air pollutants and greenhouse gas emissions. Rail transit obviously promises larger
impacts, but in the end the efficiency largely depends on the patronage. The Delhi Metro, an
underground rail with regenerative breaking system, is an example. The system has resulted
in 28,800 tons of CO2 reduction annually (Leather, 2009). However, it was lower than
expected due to a lower-than-forecast level of modal shift r tter, 2007). Another example
is Bogota’s Transmilenio BRT phase II project developed as one package with TDM and
non-motorized transport (NMT) improvement.1 From the estimated 318 tons per day CO2
1 TDM stands for “Travel Demand Management”. There are two kinds of TDM measures that have been
implemented in Bogota: (i) by restricting license plates that end with a certain number to be used on a particular
day during the morning (6:00–9:00) and evening (16:30–17:30) peak period; (ii) by controlling parking by
eliminating on-street parking.
3
emissions reduction, only 10 per cent was gained from the bus renewal itself, while 90 per
cent was attributed to modal shift r tter, 2007). Therefore, a good combination of
technology and network design plays an important role in inducing more modal shift, and
thus, larger benefits.
2.1.2 “Soft” Measures: Managing Users’ Barriers from Using Transit
As mentioned above, “soft” measures are aimed to alter both users’ and non-users’
perspectives towards using public transport. There are two types of “soft” measures: one is by
reducing the convenience of using private modes to push people out of their private modes
and use public transport, while the other is by improving the convenience of public transport
to pull people to use public transport. The former belongs to the “avoid” strategy, which
involves wider aspects of transport policy including land use management and other travel
demand management strategies. This paper focuses on the latter considering that it lies within
the scope of public transport service delivery, but it puts emphasis on its proper positioning
against other transport policies at the strategic level of policy-making processes.
The most influential factor that often makes people reluctant to using public transport is its
complexity associated with having to interchange between modes. No matter how optimized
the network design is, it remains difficult to avoid making transfers, at least walking from
origins to the nearest transit stop, transferring between transit lines, and walking from transit
stop to the destination. Such complexity likely triggers three barriers that deter travellers from
taking transit trips.
The first barrier is the unavailability of access/egress modes.2 The willingness to accept
access/egress stage largely depends on the overall trip distance and travel time itself
(Krygsman, Dijst and Arentze, 2004). The second barrier is that perceived travel time is
greater than the actual time and transfer penalty tends to be higher, particularly for those in
the more vulnerable categories of urban population, including those with physical constraints,
those accompanying children, the disabled and the elderly.3 This is imposed by walking time,
waiting time, inconvenience, uncertainty, or other external conditions, such as unsafe or
insecure locations and unfriendly weather (Hine and Scott 2000; Wardman, Hine and
Stradling, 2001; Guo and Wilson, 2007; Iseki and Taylor, 2009). The third barrier is
individual trip inflexibility, such as the need to carry out complex trip or trip-chaining
comprising several intermediate stops, for instance, to drop-off/pick-up children at school,
2 Both modes are also termed feeder modes. For areas within the catchment area of transit terminal, non-
motorized modes, including walking and cycling, can be the ideal choice of modes, whereas for areas outside
catchment areas, smaller-sized buses or, in developing countries, para-transits (e.g. rickshaws, three-wheelers,
motorcycle taxi) are ideal. Private modes are also options for access modes (e.g. park-and-ride, kiss-and-ride). 3 Indicating how much travellers are willing to pay (in monetary term) or travel (in minutes) to save a transfer.
4
and to run some errands in between trips (Hensher and Reyes, 2000; Gorham, 2002; Bhat and
Sardesai, 2006; Ye, Pendyala, and Gottardi, 2007; Currie and Delbosc, 2011).
Considering even only one of these three barriers, using public transport would significantly
compromise travel time, cost affordability, as well as the overall trip reliability and
convenience. Therefore, increasing transit patronage is no longer “merely” about providing
good quality service but about providing convenient door-to-door connectivity between
modes and services or “intermodality”. Failure to address these three factors will favour
private modes.
Thus, this study identifies three “soft” measures to ease those barriers and offer a higher
degree of “intermodality”. First is the hardware: interchange physical design including access
amenity, transfer path environment and waiting amenity. In view of the need for trip-chaining,
hardware design should also offer opportunities to carry out productive activities while
transferring by aligning transit stops’ connectivity with various public and commercial
services along the transit corridors. The second component is software: traveller information
systems including signage, timetable (Ceder, Golany and Tal, 2001) and traveller
information: unimodal or multimodal, pre-trip and at-stop, static or dynamic (Kenyon and
Lyons, 2003; Rehrl, Bruntsch and Mentz, 2007; Grotenhuis, Wiegmans and Rietveld, 2007;
Dziekan and Kottenhoff, 2007). The third is finware: fare structure (integrated or co-
ordinated), collection process, and media such as the use of electronic smart-card ticketing
systems (TCRP, 2006).
Although the effects of their improvements on people’s behaviour towards transit use are still
lacking (Iseki and Taylor, 2009), the application of at least one of these components has the
potential to, among others, enlighten the physical effort, reduce waiting time attributed to
real-time at-stop information systems (Dziekan and Kottenhoff, 2007), save time for
purchasing a ticket by using electronic ticketing (Cheung, 2006) or increase patronage by the
introduction of integrated fare systems (Abrate, Piacenza and Vannoni, 2009).
2.2 Urban Transit Governance: Regulatory Framework
The public transport industry involves a large number of stakeholders who are not always
aiming for coherent objectives, trading-off between commercial profitability and social
services. For example, from the perspective of private operators, modal shift to public
transport might not be their main concern. Instead, they are interested in attracting more
passengers from competing transit modes, not necessarily by drawing in private mode users,
and gaining financial security or at least minimizing financial risk from the business. In order
to achieve this, private operators may prefer to serve profitable lines, increase the fare in
5
return for increased service quality or even disregard rider safety and comfort to maximize
profit. It results in fragmented services as was quite evident during the western deregulation
period in the 1980s reflecting failure in providing protection and benefits to the public at
large (Sohail, Maunder and Cavill, 2006). Unsurprisingly, many public transport systems in
the world are financially unsustainable with low productivity, high costs and the need for
large government subsidies. In view of this, cities worldwide are in search for an appropriate
governance mode. They seek an economically rational regulatory framework that can address
the potential market failures that might plague the transit industry, including pollution and
congestion externalities, network effects, the need to co-ordinate a large number of agents
involved, and interactions with other urban planning issues (Estache and Gómez-Lobo, 2005).
Building a sustainable public transport industry involves two directions of governances:
vertical and horizontal dimensions (Sørensen and Gudmundsson, 2010); and three levels of
decision-making processes: strategic, tactical and operational (or the STO framework
developed by van de Velde, 1999). The vertical dimension considers the framework of multi-
level government in strategic decision-making processes, for instance, in terms of
metropolitan-area multimodal integration as well as integrating between traffic management
and transit policy or transit policy and urban planning. The horizontal dimension covers
tactical and operational decision-making processes at the local level, which involves co-
ordination among public sector entities, public transport operators and other stakeholders.
Current regulatory frameworks of transit industry in developing countries have gradually
evolved from deregulated/unregulated to a hybrid model introducing competition for the
market (see Estache and Gómez-Lobo, 2005; Barter, 2008; Gwilliam, 2008).4 This hybrid
model typically contracts out public transport procurement to the private sector to gain
greater managerial efficiency and introduces competition mainly in order to sustain efficiency
improvement (Ongkittikul and Geerlings, 2006), while a standardized level of service quality
set up by the regulator and affordability can be maintained. It is obviously a serious challenge.
3. Integration of Transit Policy Instruments and Governance: A Conceptual
Framework and the Expected Benefits
The review above suggests the importance of putting intermodality measures and a regulatory
framework in place, in addition to thorough transit technology and network design planning,
for sustaining a public transport improvement project. It is also clear that to achieve a
synergic transit governance, the transit industry cannot be thrown into the market mechanism
and must be subject to some government intervention. Taking this into consideration, a
4 The hybrid model is a public-private partnership model with various degrees of regulation touch from the
regulator (public sector) involving operators (private sector) in the provision and management of public
transport.
6
conceptual framework (Figure 1) that integrates the technical and institutional dimensions of
public transport service delivery is developed.
The framework identifies a spectrum of policy instruments at STO decision-making levels.
The effectiveness of a public transport improvement programme relies on its positioning
within urban transport systems at the strategic level. It involves local and higher authorities in
managing three interconnected elements of urban transport systems: flow, network and
activity. This framework suggests that public transport improvements should be placed at the
heart of urban transport policy-making which will not only affect the transport network but
also how the city manages travel flow and urban activities. Such positioning is expected to
give room to other supporting measures in the policy-making process, including public
transport priority system or other traffic management policy as well as stations upgrading and
further integration with travel demand and land use management policy.
Figure 1 Integrating Transit Policy Instruments and Governance: A Conceptual Framework
Furthermore, this framework separates the regulator and the operator role as a part of
regulatory reform. At the tactical level, the public transport regulator facilitates multimodal
integration both in terms of physical and “soft” measures. It sets up detailed public transport
service standards to be met by the selected operators. The form of horizontal separation and
the intensity of regulations (e.g. light touch or highly regulated) should vary depending on
7
local circumstances. At the operational level, the operators are responsible for one or more
task(s) including fleet procurement and operation, infrastructure operation, fare-box revenue
collection, and information system management through a contracting system between the
regulator and the operator for a certain length of period.
A further question is what to expect from such framework. This study highlights four model
cities: London, Singapore, Seoul and Santiago. London, Singapore and Seoul are examples of
cities that have adopted good multimodal networks coupled with intermodality measures
which were followed by or carried out in parallel with regulatory reform (see Table 2). As a
result, London’s public transport share increased by 5 per cent since 2000. While in
Singapore, by 2003, 60 per cent of its inhabitants’ trips were made by public transport.
Seoul’s bus reform since July 2004 has resulted in higher penetration of low-floor CNG buses
and, more importantly, higher bus ridership of 100,000 passengers per day. It should be noted,
though, that London and Singapore’s achievements are also due to their travel demand
management measures London’s congestion charging; Singapore’s Electronic Road Pricing
and Vehicle Quota System), and the existence of multimodal bodies London’s Transport for
London and Singapore’s Land Transport Authority) that enabled integrated approaches to
manage the circulation of people, goods and services across both cities.
Similarly to Seoul, Santiago also introduced a radical change in its bus system, the
Transantiago, and adopted fare integration with the metro system. The difference is in their
business models. In Seoul, the business scheme was transformed into a semi-public operation
through a route tendering system and joint revenue management between the city and bus
companies based on vehicle-km records. Here, the Seoul Metropolitan Government (SMG) is
responsible for network management and facilities provision, while the private sector
operates the service. SMG provides subsidies for possible shortage in revenue. But in the case
of Santiago, Transantiago is expected to maintain the existing fare levels while meeting the
policy requirement to be self-financing (Muñoz and Grange, 2010). This led not only to the
cutting of capital budget but also cuts in surface transit infrastructures. As a result, based on
Santiago Panel survey (Yáñez, Mansilla and Ortúzar), it was found that the bus market lost
17.3 per cent mode share. The increase of bus-Metro share by 14.3 per cent is believed to be
attributed to the integrated fare and the fact that Metro routes, stops and frequencies did not
change.
8
Ta
ble
2 T
he
Rel
atio
ns
bet
wee
n P
hysi
cal
Mea
sure
s, ‘
So
ft’
Mea
sure
s, a
nd
Reg
ula
tory
Refo
rm w
ith t
he
Dir
ect
Ben
efit
: R
evie
w o
f C
ases
Cas
e In
itia
l D
river
P
hysi
cal
Mea
sure
s S
oft
Mea
sure
s R
egu
lato
ry R
efo
rm
Dir
ect
Ben
efit
T
ech
no
logy
Net
wo
rk D
esig
n
Har
dw
are
So
ftw
are
Fin
war
e
Lo
nd
on
Fai
lure
of
der
egu
lati
on
:
fare
hik
es,
frag
men
ted
serv
iced
Rai
l (m
etro
,
over
gro
un
d
rail
, li
gh
t ra
il,
tram
) -
Bu
s
Tra
nsp
ort
fo
r
Lo
nd
on
(T
fL)
:
inte
gra
ted
app
roac
h i
n
pla
nnin
g a
nd
del
iver
y o
f
London’s public
tran
spo
rt
- Im
pro
ved
sta
tio
ns
and
sto
ps
- S
ola
r-po
wer
ed
sign
s an
d
dis
pla
ys
at b
us
sto
ps
- B
arri
er-f
ree
- iB
us
(veh
icle
loca
tio
ns
syst
em)
- In
tera
ctiv
e m
aps
Mu
ltim
od
al S
mar
tcar
d
(Oyst
er c
ard
) :
80
% o
f
jou
rney
s
- S
ervic
e co
ntr
acti
ng:
Lo
nd
on
Und
ergro
und
and
In
fras
tru
ctu
re
Co
mp
anie
s
- Q
ual
ity I
nce
nti
ve
Co
ntr
acts
fo
r bu
s ro
ute
s
(mo
stly
gro
ss-c
ost
)
Sin
ce 1
999
/20
00
,
5%
in
crea
se o
f
pu
bli
c tr
ansp
ort
shar
e
Sin
gap
ore
V
isio
nar
y
mu
lti-
pro
nged
app
roac
h
aim
ing t
o h
ave
75
% t
ran
sit
mo
des
sh
are
(199
6)
MR
T,
LR
T,
Bu
s
Inte
gra
tin
g c
entr
al
pla
nnin
g o
f bu
s,
MR
T a
nd
LR
T
syst
em r
edu
ces
was
tefu
l
du
pli
cati
on
of
serv
ices
- N
ew g
ener
atio
ns
bu
s sh
elte
rs a
nd
lin
k-w
ays
- MRT’s covered
lin
kw
ays
and
inte
gra
tio
n w
ith
oth
er m
od
es
- A
nn
ual
Tra
nsi
tLin
k G
uid
es
- T
ravel
In
form
atio
n
Syst
em
- In
tegra
ted
Bu
s
Op
erat
ing S
yst
em
- F
are
inte
gra
tio
n
bet
wee
n M
RT
, L
RT
and
bu
s
- E
Z-L
ink S
mar
tcar
d
- W
ell-
regu
late
d a
rea
fran
chis
e
- G
over
nm
ent
spec
ifie
d
the
fare
an
d s
ervic
e le
vel
- S
ingle
-tie
r go
ver
nm
ent,
enab
lin
g e
ffic
ien
t
dec
isio
n-m
akin
g p
roce
ss
- B
y 2
003
, 6
0%
of
the
tota
l tr
ips
are
on
pub
lic
tran
spo
rt
- M
ain
tain
tra
ffic
spee
d e
xce
eds
20
km
/h
Seo
ul
Co
nges
tio
n,
air
po
llu
tio
n,
traf
fic
inju
ries
,
fin
anci
al c
risi
s
of
met
ro
op
erat
ion
s
Met
ro,
Med
ian
-lan
e
Bu
s an
d B
us
Hie
rarc
hic
al a
nd
inte
gra
ted
bu
s
rou
te d
esig
n
- H
igh
-am
enit
y
BR
T b
us
sto
p
- B
arri
er-f
ree
Bu
s M
anag
emen
t
Syst
em
- S
mar
t-ca
rd (
T-
mo
ney
)
- U
nif
ied
dis
tan
ce-
bas
ed f
are
- F
ree
tran
sfer
bet
wee
n b
use
s,
dis
coun
t tr
ansf
er
bet
wee
n b
us
and
sub
way
Sem
i-p
ub
lic
op
erat
ion
syst
em o
f b
us
serv
ices
:
serv
ice
pro
cure
d f
rom
pri
vat
e se
cto
rs u
nd
er g
ross
-
cost
co
ntr
act
- B
us
rid
ersh
ip
incr
ease
(1
00
,000
dai
ly p
asse
nger
s)
- H
igh
er
pen
etra
tion
of
low
-flo
or
CN
G
bu
s
- D
ram
atic
imp
rovem
ents
of
pu
bli
c sp
aces
San
tiag
o
Co
nges
tio
n,
incr
ease
car
mo
dal
sp
lit
fro
m 1
8.5
% i
n
19
91
to
38
.1%
in 2
001
, st
reet
-
level
riv
alry
of
bu
s in
du
stry
Met
ro,
segre
gat
ed
corr
ido
rs o
f
Tra
nsa
nti
ago
BR
T
Fee
der
an
d t
run
k
BR
T s
ervic
es
op
erat
e in
con
jun
ctio
n w
ith
Met
ro a
s
stru
ctu
ral
bac
kb
on
e
- In
suff
icie
nt
tran
sfer
sta
tio
ns
and
in
term
od
al
stat
ion
s
- E
xce
ssiv
e n
o.
of
tran
sfer
s
- L
on
ger
wal
kin
g
tim
e in
su
bu
rbs
GP
S c
ontr
ol
in a
ll t
he
new
bu
ses
- In
tegra
ted
far
e
syst
em o
f fe
eder
an
d
tru
nk b
use
s
- S
mar
t co
nta
ctle
ss
card
(B
ip!)
- F
ree
tran
sfer
du
rin
g
a 2
ho
ur
win
do
w
- F
ran
chis
e: p
rivat
e
op
erat
ors
cho
sen
th
rou
gh
a p
ubli
c te
nd
er p
roce
ss
- L
arge
sub
sid
ies
attr
ibu
ted
by l
ow
er f
ares
,
op
erat
ors
in
effi
cien
cies
and
far
e ev
asio
n
- H
igh
er m
arket
shar
e o
f b
us-
Met
ro (
fro
m 6
.1
to 2
0.4
%)
- B
us
mar
ket
sh
are
loss
(fr
om
37
.9 t
o
20
.6%
)
So
urc
e: S
eou
l (P
uch
er &
Kim
, 2
00
5;
Kim
& D
ick
ey, 2
006
; C
erv
ero
& K
ang
, 20
11
); L
ondo
n (
Am
aral
, S
auss
ier,
& Y
vra
nd
e-B
illo
n,
20
09
; T
fL,
20
10);
Sin
gap
ore
(Ib
rah
im,
200
3;
May
, 2
00
4);
San
tiag
o (
Yáñ
ez, M
ansi
lla,
& O
rtú
zar,
201
0;
Muñ
oz
& G
rang
e, 2
01
0);
Bar
ter,
20
08
.
9
4. Bus Improvement Initiatives in Indonesia
Aiming to tackle the increased motorization in Indonesian cities, particularly
motorcycles, the Ministry of Transportation (MOT) of Indonesia enacted a decree No.
51/2007 promoting pilot cities for land transport improvement. The decree mandates the
pilot city candidates to reflect their commitments by providing documents declaring
their preparedness in terms of institutional capacity, funding capacity, human resource
availability and transportation master plan.
Figure 2 Locations of 11 Cities Adopting Bus System Reform: 2007 – 2010
Source: Public Transport Improvement Programme by 2014, Ministry of Transportation
Afterwards, the initiatives gained stronger regulatory support by the enactment of the
New Traffic Law No. 22/2009. The law specifically promotes pro-public transport
policy development in cities. In Article 158, it explicitly states that the government must
ensure the availability of land-based mass transit system to meet urban mobility needs.
As the implementation of the law, MOT provides technical assistance to promote smart
bus-based urban transport systems in order to gradually replace the old buses and
restructure the existing bus routes to create a more efficient city bus network. MOT
funds several bus vehicles and supports some of the infrastructures. From the target of
20 pilot cities by 2014, to date, 10 cities have signed MOUs with MOT and launched
such systems, in addition to Jakarta as the pioneer of the programme (see Figure 2).
The following subsections provide a progress review of bus improvement in four cities:
Jakarta, Yogyakarta, Bogor and Palembang. Data regarding the system’s characteristic,
performance and management were collected from questionnaire surveys to Trans
Pakuan (August 2010), Trans Jogja (February 2011), and Trans Musi’s August 2011)
transport authorities and operators, the presentation materials of BLU Trans Jakarta and
10
Palembang Municipal Government at the KLRTC Training Course XXI5 on 11–13
April 2011 provided by Citynet; and reports from Sustainable Urban Transport
Improvement Program (SUTIP).6 The findings are summarized in Table 3.
4.1 Transit Policy Instruments: Physical and “Soft” Measures
The physical and “soft” measures include at least four main elements. First, bus route
restructuring and bus renewal relating to the aim of scrapping old buses with the new
system’s buses were implemented. In response to this scrappage policy, Yogyakarta,
Bogor and Palembang set up clear targets of scrappage ratio (see Table 3), following the
enactment of local regulation to stop issuing new bus licenses. In the case of Jakarta,
along with the development of 15 Transjakarta corridors, some overlapping large bus
routes have been abolished and/or restuctured.
The scrappage policy is considered a win-win solution that benefits both the
government and the operators. On one side, the initiative assists incumbents to replace
their old vehicles as mandated by local regulation and secure their revenue. On the other
side, it accelerates the process of public transport reform. However, in general, vehicle
procurement is financially challenging, as it depends on political commitment and
financial capability of the local government. Even in the case of vehicles funded by the
MOT, some administrative issues occured. For instance, there were prolonged legal
problems in changing the functional status of the buses from “red-plate” government
vehicle status) to “yellow-plate” public transport vehicle status) in the case of Trans
Jogja. Such problems significantly affect the system optimization and reliability,
particularly in cities with limited public funds.
Table 3 System Performances of Transjakarta, Trans Jogja, Trans Musi, and Trans Pakuan
Transjakarta
(data by 2010)
Trans Jogja
(data by 2010)
Trans Musi
(data by 2011)
Trans Pakuan
(data by 2009)
Urban Area Characteristics
Urban Area Jakarta Metropolitan
Area Greater Yogyakarta Palembang City Bogor City
5 http://www.citynet-ap.org/media-room/events/s/cifal-klrtc-xxi-sustainable-urban-transport/
6 Sustainable Urban Transport Improvement Program provides methodological and technical support in
the development and implementation of measures to improve urban transport in selected medium-sized
and large cities over 100,000 inhabitants including in Indonesia. It is a partnership between German
Technical Cooperation (GIZ) with the Ministry of Transportation, Government of Indonesia and in close
cooperation with several local governments. The output of this project can be accessed at
http://www.sutip.org/Home/outputs.
11
Transjakarta
(data by 2010)
Trans Jogja
(data by 2010)
Trans Musi
(data by 2011)
Trans Pakuan
(data by 2009)
Area (km2) 661.25 234 400.61 118.5
Population (people) 8,523,157 1,900,000 1,417,047 905,132
Physical Measures
Year of establishment 2004 2008 2010 2007
No. of corridors (target) 8 (15 by 2014) 4 (15) 5 (8 by 2013) 3 (7 by 2020)
Length (km) 170 120 27– 35 28.5
Shelters
(provided by)
184
(Province)
76
(Province & City)
134
(City & PPP)
49
(City)
Fleet
Size Large & Articulated Medium Large & Medium Medium
Fuel CNG, Euro-II Euro-II CNG Hybrid (biofuel)
Operating Vehicles 524 54 85 18
Provided by Province, Operator MOT, Operator MOT, City,
Operator MOT
CNG stations 6 None 1 None
‘Soft’ Measures
Hardware: Transfer Facilities
Shelters High-floor, on-median,
interchange points
High-floor, roadside
shelters
High-floor,
roadside shelters
High-floor, roadside
shelters
Multimodal
integration P&R
Airport, P&R,
Bicycle rack on bus River bus None
Software: Information System
Timetable Scheduled
Information system Route map at shelter, leaflets, security/information offices, signage
Electronic board - - -
Finware: Fare and Ticketing System
Fare structure3
Flat (single trip, morning
peak hour 5–7 AM
discount), free transfer
Flat (single trip,
regular public &
student), free transfer
Flat
(single trip), free
transfer
Flat
(single trip), free
transfer
Ticketing system
Electronic (smart card,
multipurpose card
Jakcard) + Manual
Electronic (smart
card) Manual
Electronic
(multipurpose card
Flazz) + Manual
Off-board Off-board On-board On-board
Regulatory Framework
Regulator BLU UPTD Dishub
Dishub
Bus Operator 8 consortiums/ private
companies 1 consortium BUMD BUMD
Revenue Sharing Gross-cost contract Gross-cost contract Capital sharing Capital sharing
Scrappage Programme Restructuring
overlapping routes
2 old buses with 1
Trans Jogja bus
474 conventional
bus with 275
Trans Musi bus1
3 angkot with 1
Trans Pakuan bus
Operational Performance
Load factor (%) 47.832 42 75 85
Interval headway (mins) 5–15 5–10 5–10 n/a
Average speed (km/h) 18 28 20–40 n/a
12
Transjakarta
(data by 2010)
Trans Jogja
(data by 2010)
Trans Musi
(data by 2011)
Trans Pakuan
(data by 2009)
Annual Ridership 86,937,488 5,834,976 2,500,000 1,102,542
Daily Ridership 340,000 13,000 7,500 3,000
% Farebox Revenue 62 71 91 65
% Subsidy 38 29 12 35
Note:
1Will also reduce the number of angkot from the existing 2,200 to 1,570 units and deploy them as feeders.
2Average load factor in 2007. In the case of corridor 1, the load factor during peak hours can reach 70–90%.
31 USD equals to around IDR 9,000. The fare ranges from 20–40 cents.
The new vehicles are air-conditioned and more fuel-efficient (Euro-II compliant diesel
bus). Some systems use environmentally friendly fuels such as CNG in Jakarta and
Palembang, and hybrid (a mixture of diesel and 20 per cent of used cooking oil) in
Bogor. The availability of city gas networks and CNG stations remains the major
limitation in expanding the deployment of CNG buses.
Second, the new bus system operates on dedicated lanes. To date, only Transjakarta
operates mostly on dedicated lanes, while others run in mixed traffic due to, among
others, technical barriers, such as narrow streets in Yogyakarta and Bogor. As an
alternative, the cities installed bus priority systems at intersections with traffic signals in
co-operation with local traffic authorities or applied colour-painted curbside bus lanes.
Third, designated shelters where off-board fare collection takes place were established.
The availability of shelters forces passengers to board and alight only at the designated
high-floor stations. These stations are located in the middle of the road as adopted by
Transjakarta’s system or on both roadsides as found in the other 10 pilot cities. This
type of shelter usually consists of an end-terminal where a corridor starts and ends,
intermediate shelters every 300–400 meters along the corridors, and some transfer
points connecting one corridor to another. Due to land availability concerns, instead of
building permanent shelters, some cities provide semi-permanent or portable mobile
shelters. The shelters are mostly equipped with off-board ticketing systems either
electronic or manual (e.g. ticket booth, e-card reader or ticketing officers, except
systems that apply on-board ticketing), simple information systems (e.g. real time
displays, route maps or security/information officers), and waiting amenities (e.g.
seating facilities). These shelters’ financing is shared between the municipal and the
central governments (through provincial government) and/or private-public partnerships
13
schemes in return for commercial advertisement.
Fourth, each city is supposed to provide a feeder system that feeds passengers from
wider parts of the city to the new bus system and introduce multimodal integration.
Unfortunately, in this matter, most cities are still at the planning stage. Transjakarta has
long been operating without a functioning feeder system, although plans have been
made. Resistance from incumbent operators has been one of the reasons. Three feeder
routes are scheduled to start operating in 2011. In terms of multimodal integration,
Transjakarta has been integrated with several park-and-rides, Yogyakarta has integrated
Trans Jogja with airport, bicycle and pedestrian facilities, and will soon operate some
park-and-rides, while Palembang integrates Trans Musi with its river buses.
4.2 Regulatory Reform Progress
The regulatory reform is the bus industry reform. The bus industry in 11 cities is
currently in a transition period from an unregulated structure (Cervero and Golub, 2007;
CDIA, 2011) to a formal and efficient industry. They continue to search for the most
appropriate type of institutional arrangement to be established, which fits local
circumstances, aiming for improving the efficiency and productivity of public transport
service delivery.
Historically, in Indonesian cities, private operators have played a dominant role in urban
bus industry with little control by the government. Through the reform, a horizontal co-
ordination between the regulators and the bus operators is developed through the so-
called “buy-the-service” scheme. Here, the role of the regulator in planning,
programming and managing the entire bus system, including other supporting services,
is strengthened. The regulator (i) selects the operators preferably through tendering
processes to award quality licensing; (ii) monitors the implementation of minimal
service standards (SPM) by the selected operators based on the periodic contract of five
and seven years between the two parties and if the operator fails to fulfil the agreement
or violate rules, penalties will be applied.
The regulator is usually a local governmental unit. There are two types of entities that
have been introduced: local technical implementing unit (UPTD) and local public
service unit (BLUD). The two entities are different in terms of their flexibility in
managing their budget and adopting necessary business strategies. As a UPTD, it
reports to local transport agency (Dishub), while BLUD reports directly to the governor
14
or mayor under the monitoring of Dishub. In short, BLUD is more independent than
UPTD and, therefore, is expected to be more efficient in making decisions. Among the
11 cities, only Transjakarta is managed by a BLUD.
For Transjakarta’s case, the regulator has evolved from a non-structural managing body
(Badan Pengelola)7
in 2003 to a structural UPTD in 20068
and, currently, it is
transforming gradually towards a full BLUD, which is a working unit under a
government institution that has the obligation to provide public services without aiming
to earn profits, but has the flexibility to manage its budget and fund, as well as to adopt
healthy business strategies to improve its efficiency and productivity.9 In the future, to
eliminate the subsidy, BLUD TransJakarta perhaps will be upgraded into a local
government-owned company (BUMD). As some requirements to be a full BLUD have
not been fully met, it is currently operating as a public service unit (BLU) under the
Dishub. Although it has a separate budget and is able to utilize the operating revenue
directly, the management is still less flexible.
Regarding the selection of operators, although it is intended to carry out tendering
processes, Jakarta and other cities prioritize invited incumbents, particularly those
whose bus services overlap with the new bus corridors, to join the Transjakarta
consortiums. This is a countermeasure to ease resistance from the conventional bus
incumbent operators who often perceive the new bus system as their competitor. If more
operators are needed, new entrants are then invited to participate in the tendering system.
To date, four consortiums and two operators are currently operating the ten corridors.10
Their services are compensated per vehicle-km to cover fleet procurement, operational,
maintenance, overhead costs, and some profits, except corridors 1, 9 and 10 whose
fleets were purchased by the government. The level of payment varies across corridors
according to the negotiated contracts. In principle, the level of payment should
guarantee the return on bus operators’ investment and reflect the level of service
performace. BLU Transjakarta also contracts out supporting services operators
(ticketing and revenue collection, provision of security services at the shelters, provision
7 Governor of Jakarta Provincial Government Decree Number 110 Year 2003.
8 Governor of Jakarta Provincial Government Regulation Number 48 Year 2006.
9 Government Regulation Number 23 Year 2005 regulates BLU’s financial management.
10 Namely Jakarta Express Trans, Ltd. (PT JET), Trans Batavia, Ltd. (PT TB), JakartaTrans Metropolitan,
Ltd. (PT JTM), Jakarta Mega Trans, Ltd. (PT JMT), Prima Jasa Perdana Raya Utama, Ltd. (PT PP), and
Eka Sari Lorena Transport, Ltd. (PT ESL).
15
of feeder services, and infrastructure maintenance) and co-operates with DKI Jakarta
Bank as a trustee.
Figure 3 Fare Revenue and Subsidy of Transjakarta Busway, Jakarta, Indonesia
Source: Analysis from BLU Transjakarta data 2011.
The total number of Transjakarta passengers is increasing year by year, reaching
82,377,659 in 2010. However, the number of passengers per km decreased from 3.4 and
3.8 in 2004 and 2005, respectively, when only the first corridor was operating, to 2.4 in
2009 when all 8 corridors were operating. Figure 3 shows the financial situation of
Transjakarta Busway system where the share of fare-box revenue continues to decline.
The cost recovery rate decreased to 62.56 per cent and the subsidy is expected to
increase higher. In 2011, the total subsidy including payment for supporting services
was estimated to reach 52 per cent.
Trans Jogja system adopts a similar scheme to Transjakarta. Given that the system is
operating beyond Yogyakarta City’s administrative area, it is being developed under
close co-operation between the provincial government of Yogyakarta Special Region,
Yogyakarta Municipal Government and its neighbouring regencies (Sleman and Bantul
Regency). Each party shares the role of establishing the shelters, park-and-ride, and
other supporting infrastructures to optimize the system.
16
In terms of bus operation, the current four corridors are operated by one consortium,
Jogja Tugu Trans, Ltd. (PT JTT), consisting of four co-operatives and one state-owned
bus company. UPTD Trans Jogja, under the authority of provincial transportation
agency of Yogyakarta Special Region, pays fee per vehicle-km travelled to the operator.
Trans Jogja’s fare levels are different for single-trip users, regular public users, and for
regular student users, with free transfers to the entire system. With this arrangement, the
ridership is quite high, reaching 13,000 passengers per day. Nevertheless, the main costs
remain higher than fare-box revenue and, by 2010, the cost recovery rate was only 31
per cent.
Different from Jakarta and reater Yogyakarta’s scheme, Bogor’s Trans Pakuan bus
system and Palembang’s Trans Musi bus system are operated by local government-
owned company or BUMD instead of a consortium. Here, local government plays the
shareholder. BUMD is expected to become a local revenue source, and, thus, earn profit.
Bogor’s Trans Pakuan operator, PD Jasa Transportasi (PDJT), was established in
2007.11
The company deals with transportation service businesses, covering not only the
operation of Trans Pakuan bus system but also other transport service divisions, such as
garage, tow truck, mobile toilet and parking services. So far, aside from the public
transport service division (Trans Pakuan), the other divisions have not been fully
operational. In the future, it is expected that cross-subsidy from those profit-oriented
divisions to finance public transport division will occur. Bogor municipal government
does not provide annual subsidy, but it shares a total amount of basic capital, as stated in
the local regulation No. 11/2008. By 2010, according to local regulation No. 7/2010,
more than half of the designated budget allocation had been paid to PDJT in form of bus
fleets, a tow truck and Trans Pakuan’s operational costs, while the remaining amount
will be paid within a five-year period.
Until 2009, the annual ridership of Trans Pakuan showed an increasing trend from
935,035 passengers in 2008 to 1,102,542 passengers in 2009. The daily ridership
reached almost 3,000 passengers. However, the three corridors have not been optimized
yet. From 30 vehicles available, only 18 buses are in operation, resulting in lack of
reliability, declining number of passengers per km. As the fare-box revenue is
decreasing, the subsidy further increased from 9 per cent in 2008 to 35 per cent in 2010.
11
Based on Local Regulation of Bogor City Government Number 5 Year 2007 which was amended by
Local Regulation Number 11 Year 2008.
17
The Sarana Pembangunan Palembang Jaya, Ltd. (PT SP2J) which operates Palembang’s
Trans Musi has been established since 2006 with a vision to improve local economic
growth as the main reference for chanelling infrastructure investments in general, not
only transportation.12
Before being appointed as the managing body of Trans Musi in
2009, it was dealing with a wide array of business sectors, including public housing
(rusunawa), water transport (Kapal Putri Kembang Dadar) and environmentally
friendly hydrocarbon refrigerant (musicool).13
Palembang municipal government played a significant role in accelerating its bus
improvement programme, on account of its strong leadership, reflected in the rapid
progress in expanding the system. In one year (2010–2011), the city managed to operate
68 of the 85 available buses, serving 5 out of the 8 corridors planned by 2013. As a
result, the load factor reached 75 per cent and the annual ridership increased from
2,130,000 passengers to 2,500,000 passengers this year. On average, the daily ridership
is 7,500 passengers. The operational cost recovery rates were quite high at 94 per cent
in 2010, although it decreased to nearly 75 per cent during the first semester of 2011. To
cover the operational costs of which drivers’ salary constitutes the largest cost share, the
authority plans to increase the fare level by 30 per cent.
5. Conclusions
This study developed and applied a conceptual framework highlighting three transit
policy elements—physical measures, “soft” measures, and regulatory reform—to
review the progress of bus improvement initiatives in Indonesian cities. The three
elements are considered critical in ensuring the effectiveness and sustainability of public
transport improvement initiatives. As its case studies, this study observed four cities:
Jakarta, as the pioneer of bus improvement initiative, and three pilot cities of a
nationwide bus improvement programme initiated by the central government
(Yogyakarta, Palembang and Bogor).
In general, Jakarta’s independent initiative and the stimulus given by the central
government through nationwide bus improvement programmes to the other three cities
have laid the groundwork for better land transport management at the local level, even
12
Based on Local Regulation of Palembang City Government Number 4 Year 2006. 13
Based on Mayor of Palembang City Government Decree Number 1745 Year 2009 regarding route
licensing of Trans Musi BRT.
18
though the performance of each city varies widely and there are many shortcomings
with which to deal. Regarding the physical measures, the four cities are encountering
difficulties in expanding the service capacity in terms of increasing the number of
vehicles, providing bus priority systems, and optimizing the network. Financial sharing
among multi-level governments and public private partnerships (e.g. shelter
construction) are among the solutions taken to tackle this issue. Nonetheless, technical
barriers such as land availability, narrow roads, among other issues, remain a challenge,
particularly in providing dedicated lanes, which are a crucial element for bus-based
transport in ensuring punctuality in travel time. In response to this dedicated lane issue,
some cities installed traffic signal priority systems as an alternative measure, but better
co-ordination with traffic authorities is necessary. Whilst social resistance from the
citizens against shelter locations can be solved through technological innovation, such
as portable shelters, it may disadvantage the system image. Participatory approaches to
obtain people’s co-operation have also been carried out. Such negotiated approach is
also adopted in managing resistance from incumbent operators who foresee the new bus
system as a competitor, by prioritizing them in the operator selection process for the
new bus system at an earlier stage.
The implementation of “soft” measures is still lacking, particularly multimodal
integration and improvement in “intermodality”. The bus system has been seen as an
effective entry point, particularly towards restructuring and scrapping the conventional
public transport, considering Indonesian cities’ circumstances. However, more efforts to
integrate the bus system with other modes of transport are needed as a key element to
enhance the system capacity through expanding service coverage as shown by London,
Singapore, Seoul and Santiago. More importantly, the positioning of each new system
within the urban transport system at the strategic level remains weak, and, thus, the
initiatives seem more incremental in nature rather than a part of a comprehensive and
long-term planning. A good positioning is demonstrated by Curitiba’s experience in
Brazil in relation to land use planning and traffic management policy (Rabinovitch,
1992; Santoro and Leitmann, 2004). Such clear vision is needed to enable bus systems
to reach higher capacity through citywide system coverage.
Despite this, the current fare structure seems to be quite effective in attracting
passengers for using the new bus system since it is relatively lower than the other
conventional bus fares due to subsidy, flat rate, and free transfers to the entire system. In
the short-term, such fare structure might have been useful for gradually influencing
19
public perspectives towards public transportation. In the long run, as the network
expands, maintaining such fare structure may risk the system’s financial sustainability
due to the need for increasing subsidy.
In response to the challenges encountered, the four cities explored regulatory reform
from unregulated to a hybrid model, introducing competition with a certain degree of
regulatory touch. Such change is essential, particularly in managing financial barriers to
improve service reliability and wider system coverage. The reform strengthened the
capacity of regulators in land transport planning and management and allowed the
operators to focus on improving the service to meet standards. The capacity of bus
operators in delivering standardized services of one or more bus lines improved and the
prevailing daily sublet system between bus owner and bus crews (driver and conductor)
was abolished. Local governments became fully responsible for the provision of their
new bus networks and, basically, bear all the risks associated with it. Hence, it
minimizes the operators’ financial risks since they no longer have to pursue more
passengers to earn more revenue.
In conclusion, effective transit governance is critical to ensure smooth delivery of both
physical and “soft” measures as demonstrated by Indonesian cities in an attempt to
improve their urban mobility. The lack of one of the elements imposes higher risks in
jeopardizing the effectiveness of the whole system. It also determines the capability of
providing reliable transit services and, thus, to what extent a public transport
improvement initiative can actually contribute to sustainable urban development. To
provide more evidence, an application of the framework to similar initiatives in other
developing countries would be useful to comprehend the effects of other locality
settings. Further work should identify performance indicators beyond the project
implementation scope and evaluate the intangible co-benefits of the initiatives at the city
scale.
20
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