28 Nov 2019

Nationwide transport ticketing project behind schedule by two years

3:52 pm on 28 November 2019

A national system of paying for public transport tickets virtually anywhere - using cellphones, credit card or paywave - is beset by delays and uncertainty.

AT Hop card and timetable

Photo: RNZ / Todd Niall

The NZ Transport Agency (NZTA) says the rollout of the Next project will start on Wellington's trains in 2022, two years behind schedule.

It has blamed delays on changes in the available technology options.

But a consultant's report to NZTA found a lot of problems at the agency itself, including how it put the project into the hands of its dysfunctional Connected Journeys unit (CJS) for two years.

"We were advised the head of CJS [director Martin McMullan] adopted a relatively hands-off approach," consultant company Deloitte's report stated.

Auckland's HOP, Wellington's Snapper, and Canterbury's metrocards are all meant to be superseded by 2026 by the streamlined ticket system across all regions, except Gisborne and Marlborough.

It's called open-loop payment, and after London introduced it in 2012, the number of public transport rides jumped 40 percent.

About 20 major cities worldwide have such systems, but introducing one across a whole country was rare.

In New Zealand, it will come at an estimated cost of $250m - eight years ago the estimate for a smaller system was $30m - including $13m to get to a detailed business case stage, of which $7.8m has been spent so far.

"The fiscal risk to the Crown and the Land Transport Fund, should the project fail during implementation and transition, is considerable," Deloitte's report stated.

"This project is attempting to procure a national, account-based, open-loop and multi-tenanted ticketing solution within a complex stakeholder environment. This has not been done in New Zealand, and is believed to be uncommon in the world."

The problems the report lists have been mounting:

  • Milestones have been missed
  • Tender deadlines slipped; the tender for the ticket system technology is now due to begin early next year, a year late
  • Councils have not yet committed to pay their share

It is unclear if Auckland will get the new system by 2026 as planned - 2026 is also when its HOP card system contract with multinational Thales runs out. Auckland Transport told RNZ it would continue or replace HOP until Next was ready.

The lack of clarity around key features is raised a dozen times in the Deloitte report: Unclear governance, unclear priorities, objectives, reporting lines or around who is accountable.

But it also said the ticket project still had "good momentum".

"Despite NZTA's recent involvement and oversight ... being limited, this appears to have not had a material impact," the report stated, while also listing many risks associated with the lack of central government oversight.

More fundamentally, it said NZTA lacked an "active vehicle" to implement the government's public transport priorities, and had let its focus on a national ticketing plan lapse.

The Next project sat since mid-2017 with Connected Journeys, which flouted public sector controls and was shut down this year, at which time it was juggling 40 projects, poor reviews have shown.

The project had little governance. NZTA said last night it had reactivated a governance group for it, which had not met since April 2018.

NZTA admitted in its 2018-19 annual report that it had "serious issues" with "transport technology functions".

The annual review showed the agency recently had to dump a near-new technology plan when it realised it did "not address key issues", and was still working on a replacement plan.

However, changes in technology options have also played a part in delays around the ticketing project. The plan from 2011-2015 had been to get the whole country to adopt Auckland's HOP technology, which was dumped in favour of "contactless card paying".

The delays also allowed Auckland Transport to decide last year to wind up HOP and go with Next when it's ready.

National integrated ticketing has been promised for a decade.

NZTA mentioned it 22 times in its 2015-16 annual report. But last year's report mentioned it just twice, and this year's not at all.

In 2016 it said that one of just seven major achievements was that "modern, fully integrated ticketing and fares are being implemented" nationwide.

A stepping stone towards that was meant to be a smaller, regional ticketing scheme, called RITS.

NZTA documents show the original aim was to have this in place in mid-2018; RITS has begun in Whangārei, is being tested in Hamilton, will go live in Whanganui next month and is scheduled to begin in remaining regions in the first half of next year.

The agency said that for Next as a whole, "work is well underway to establish clear objectives".

Yet as recently as May this year, minutes released under the OIA showed the agency's technology governance group was still debating whether standardised national ticketing was the way to go.

NZTA said the governance group had been "re-established to ensure appropriate levels of governance", and a draft Detailed Business Case should be ready by Christmas.

Experienced international suppliers were on a shortlist to provide the ticketing solution, it said.

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