The annual cost of funding public transport in NSW is set to hit $5.7 billion within a decade, raising the prospect of commuters being slugged with higher fares to achieve a balance between those who "directly benefit" and others.
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The forecast is contained in the draft Future Transport Strategy released on Sunday, which updates the NSW government's 2012 long-term transport master plan by outlining its vision for likely changes led by technology, innovation and population growth to 2056.
Under the plan, two-thirds of Sydneysiders will be able to commute between their jobs, homes and key services within 30 minutes, but they may have to wait 40 years to do so under new long-term strategies that will divide Sydney into three interconnected cities.
The strategy also notes that the gap between the operating cost of public transport and revenue recovered from fares, advertising and other means has grown by an annual average 4.5 per cent since 2012 to hit $3.6 billion in 2016. Due to increasing operational expenses as more infrastructure such as the Sydney Metro is built, it says the gap is expected to rise to $5.6 billion by 2026.
It warns that surging transport operational expenses "will compete with the need to resource other vital services such as education and health".
At present only 29 per cent of operating costs are recovered by the public transport network compared with about 60 per cent "historically".
The document says a level of taxpayer funding by those who do not "directly benefit" from the network is justified because public transport has broad economic, health and environmental benefits for the community.
But it adds that "the imbalance between those who directly benefit from transport investments and those who pay for them should be considered and addressed".
Between 2012-16, revenue from public transport fares fell by an average 0.3 per cent per year while patronage grew by eight per cent, the strategy notes.
It says some cities have targets for the proportion of operating costs recovered from fares, such as Chicago at 50 per cent. It highlights London which is increasing fares by inflation plus one per cent annually to reach its target of 100 per cent.
The strategy also notes Sydney public transport fares are "relatively low compared to other jurisdictions", including in London and Munich where they are more than double.
While it says the building and expansion of railway stations and interchanges presents the opportunity to sell airspace to developers, "this will not materially change the nature of the long-term funding challenges the transport system faces".
The document commits the NSW government to exploring these options as well as "balanced beneficiary models" including contributions from developers who build near new transport infrastructure.
The government will also "monitor cost recovery levels and review measurable service quality and quantity improvements" on the public transport network.
In NSW maximum annual public transport fare increases are set by the Independent Pricing and Regulatory Tribunal.
Transport minister Andrew Constance told Fairfax Media there are "no planned changes to public transport fares".
"We will continue delivering affordable fares for our customers, as we have done since coming to government," he said.
"We all know that there is significant public investment in delivering transport services - 75 per cent is covered by operating subsidies from taxpayers.
"Transport for NSW will continue to set Opal fares in accordance with advice from the Independent Pricing and Regulatory Tribunal."
A Transport for NSW spokesman said the future transport strategy "involves investigating project needs and priorities, and does not represent government commitment".
