Penalties as incentives for punctuality and regularity in tendered Swedish public transport

Roger Pyddoke, Research of Transportation Economics, September 2020

This paper studies penalty design for cancellations and delays for bus contracts in two Swedish regions, Stockholm and Skåne. In these regions regional public transport authorities are responsible for the procurement. The paper reports findings on how the designs of the incentives are motivated, how the performance monitoring is managed, and the consistency in charging of penalties and how outcomes have evolved. Two design forms are found, either charges for individual deviations or deviations from an aggregate target level. Little motivation is found in form of narrated or documented intended effects, experience of penalty design or the outcomes of penalties. Outcomes are monitored regularly by contract managers, based on computerized data capture. There appears to be no detailed records of charging making it possible to compare to outcomes. There are indications of non-negligible exemptions from charging attributed to factors beyond the control of operators. The current level of delivered departures is high in both regions but shows no clear trend. The aggregate level punctuality appears to be decreasing at both the RPTAs, but only statistically significant for one. The picture is complicated by the fact that punctuality develops differently in different parts of the regions. The paper reflects the uneven availability of data and documentation of mangagement procedures.

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