Skip to main content

Myki uptake reaches 25 percent in Melbourne

by David Shi •
Subscriber preview

The rate of all Melbourne ticket validations performed using the Myki smartcard has increased to 25 per cent within the past financial year, up from a rate of just six per cent in July 2010.

But with three-quarters of commuters yet to make the switch to Myki, the Baillieu Government will extend its contract with the supplier of the paper-based Metcard system by another nine months to take it out to the end of 2012.

Over 13 million Myki smartcards have been issued across Victoria since the activation of the Myki system. Data provided Transport Ticketing Authority’s (TTA) Annual Report showed Myki touch-ons accounted for 25 per cent of all ticket validations in Melbourne in June 2011, a 6 per cent increase from July 2010. On regional bus services, Myki accounted for 35 per cent of all ticket validations.

“Around 1.5 million touch ons are recorded each week across Melbourne’s trains, trams and buses,” said the TTA’s CEO Bernie Carolan in the 2010-11 Annual Report.

Despite the increase in Myki usage, the paper-based Metcard system remains the most popular option for Victorian commuters. During 2010-11, the Myki system processed $96 million worth of ticketing costs whilst the paper-based Metcard system processed $545 million.

In terms of commuter satisfaction, the number of passengers contacting the Public Transport Ombudsman about Myki increased from 584 in 2009-10, to 779 in 2010-11. The increase was however attributed to the greater uptake of the system and its expansion onto trams and buses in July 2010.

The Department of Transport’s (DoT) 2010-11 Annual Report also revealed that overall public satisfaction with Myki remained high, with the smartcard system receiving an average customer satisfaction score of 7 out of 10 in September 2010.

In June 2003, the TTA was established to manage the paper-based Metcard ticketing system and also to oversee the development and implementation of a new smartcard-based ticketing system.

On 12 July 2005, Kamco Consortium was awarded a 12-year, $494 million contract for the delivery of ‘New Ticketing Solution’ for the TTA.  Following a two year development period, Myki was originally scheduled to go live in 2007, but delays in the project meant that much of the system did not go live until 2010.

With the inclusion of an estimated annual operating cost of $50-55 million, the total cost of the Myki system was originally estimated to be under $1 billion. In May 2008, an additional $352 million in Government funding was allocated towards the Myki project, along with $79 million for the continuation of Metcard due to the delays.

Concerns were also raised surrounding the original tender process, with revelations in 2007 that the TTA’s then CEO, Vivien Miners, held undisclosed shares in a sub-contractor for Kamco Consortium. In 2008, it was also revealed that the auditor for the original tender process was married to the then recently-appointed CEO of the TTA, Garry Thwaites.

The Myki system was finally activated for public travel on trains on 29 December 2009 and extended to Melbourne’s trams and buses on 25 July 2010. The election of the Baillieu Government in December 2010, however, placed the future of the Myki system rollout in doubt, with Premier Ted Baillieu being a vocal critic of the scheme. 

On 28 December 2010, Mr Baillieu announced a comprehensive review of the $1.35 billion smart card system. 

“Obviously there are costs associated with rolling it out, even as it currently is. And there are obviously costs associated with either scaling it back or scrapping it altogether, but they're the questions we want to have independently answered,'' said Mr Baillieu. 

Following the conclusion of a Department of Treasury and Finance cost review in June 2011, it was found that the cost for a complete dismantling of the Myki system would be greater than completing the myki roll-out. The Herald Sun reported that the scrapping of Myki and development a new ticketing system may cost up to $2 billion.

The conclusion of the review also came with the Government announcing a continuation of Myki system roll-out, albeit following a modified format. Mr Baillieu said that the project was retained through negotiations with NTT Data and not Kamco Consortium. NTT Data acquired Kamco after purchasing Kamco’s previous parent company, Keane International Inc in October 2010.

The TTA and Kamco are in ongoing negotiations for the modified ticketing system, which are expected to last several months.

The DoT’s Annual Report also indicated that the Department’s Administration and IT expenditure increased from $22.2 million in 2009-10 to $37.5 million in 2010-11. Despite the increase in expenditure, the TTA’s Report indicated a drop in staff numbers from 121 to 111, with the number of fixed term employees dropping by 14 per cent.


Related Articles:

NSW and Victoria get runs on the e-ticketing board

VIC Budget: $400 millon to finish Victorian ICT projects

$1.2 billion for NSW Electronic Ticketing: What has been done so far?

Already a subscriber? Sign in here to keep reading

Want more content like this? Contact our team for subscription options!

  • Stay up-to-date on the latest news in government
  • Navigate market uncertainty with executive-level reports
  • Gain a deeper understanding of public sector procurement trends
  • Know exactly where government is spending
  • VIC
  • IT Services
  • Transport