[Feature: Mobility in a Depopulating Society] The Current State of Japanese Bus Policy / Kazushige Terada

2020/07/06

Japan is a country where railroads are convenient, but there are many villages that railroads cannot cover and destinations far from stations. Approximately 40,000 bus systems (a concept of subdivided routes) cover such areas across the country. On the other hand, as seen in the climaxes of TV travel programs featuring local bus transfers that keep viewers on the edge of their seats, there are increasing cases where bus routes are completely cut off at municipal or prefectural borders, or where the number of services has become extremely low in the suburbs of large cities.

In this article, I will point out that the schemes for community buses and demand-responsive transport, which are becoming increasingly popular, are not panaceas for Japan's buses, which are becoming more important in an aging society. Furthermore, I will state my personal views on the effects of deregulation, the nature of subsidies, and labor issues for drivers as policy issues surrounding buses.

The annual number of passengers on shared-ride buses in Japan peaked at 10.1 billion in fiscal 1970 and then declined to 4.3 billion in fiscal 2016. However, the pace of decline slowed starting in 2000, partly because the proportion of people unable to drive their own cars increased due to the aging population. Currently, the number of passengers transported is increasing slightly in urban areas, and the decline in the number of users has halted even in rural areas.

Around 2000, many local governments began to set up meetings to discuss local bus issues with representatives of residents. These discussions often remained formal and lacked substance, focusing on whether to approve or postpone the abolition of bus routes. However, from 2007 to the present, the national government has gradually implemented institutional reforms to strengthen the authority of these meetings. There have been an increasing number of cases where people are trying to seriously consider the future of buses over a span of about 10 years in light of the future of the region.

Centering on regional core cities, serious efforts have begun on public transportation network plans to support the creation of "compact cities" with low environmental impact. Gifu City's trunk bus plan and Toyama City's plan based on LRT (Light Rail Transit: streetcars with excellent boarding and alighting performance) are attracting attention as good examples.

As the population declines not only in mountainous areas but also in regional cities and the suburbs of large cities, community buses and demand-responsive transport are being operated in places where large bus services cannot be maintained due to the decrease in users. Of the 1,741 municipalities nationwide, 1,281 operate community buses and 516 operate demand-responsive transport (2016).

The term "community bus" is Wasei-Eigo (Japanese-made English) and is unrelated to the vehicles of the same name in the UK. It refers to buses operated primarily by municipalities in a form separate from formal public transport (such as Yokohama City Bus) without relying on national subsidies. Their numbers increased rapidly after financial measures were taken where 80% of expenditures are covered by local allocation taxes.

Many people believe that the "Mubus" in Musashino City, Tokyo, which started in 1995, is the origin of these community buses, and it is true that Musashino City was the first to use that name. However, in terms of buses with functions and route characteristics that would later be called community buses, the "City Circular Bus" (now MM Shuttle) in Musashimurayama City, Tokyo, which started in 1980, is the root. The first service to gain a significant number of users was the "Minibus" in Hino City, Tokyo, which started in 1986. One month before the start of Mubus, the "Pony-go" in Kamakura City, Kanagawa Prefecture, was operated, which looked very similar to Mubus except for the fare structure.

Community buses also brought innovations that broke the common sense of conventional bus services. For example, by setting low fares while eliminating complex discounts, there is room to increase usage without significantly reducing revenue per passenger. Also, even in Japan, where there is not much weekly periodicity in weekday transportation behavior, there is a possibility that operation on specific days, such as "Monday only," will be accepted by residents.

On the other hand, the negative effects of municipalities deciding on service content have also been exposed. For example, even if there is a shopping district in a neighboring city where residents want to go shopping, the bus does not go there; it stops equally at villages within the municipality even if there is almost no usage; and it takes a considerable detour to the essential destination to stop at public facilities that most residents have little use for.

However, as a considerable amount of time has passed since the start of operations, progress is being made in operating wide-area networks in cooperation with adjacent municipalities and in devising fares and timetables so that residents can use them without distinguishing them from general buses. Although not limited to community buses, it is also noteworthy that since about 10 years ago, municipalities have begun to focus on the importance of transportation for young people who will bear the future of the region, especially high school students, in addition to the elderly. There are cases where buses are maintained only during school hours, buses are operated to eliminate the need for high school students to live in boarding houses, and fare subsidies have begun.

Demand-responsive transport is a shared-ride service using small buses or sedan-type vehicles that operates without fixed routes or timetables. It is attracting attention as a trump card for securing the last means of transportation in areas where other public transport cannot be maintained.

In the past, it seems that buses sometimes changed routes according to customer requests at the driver's discretion, but in terms of doing so systematically, the first was Hankyu Bus's "Nose Demand Bus" started in Nose Town, Osaka Prefecture, in 1973 using simple communication technology. Since 2000, electronics manufacturers and telecommunications carriers have competed to supply operation support systems, and operation close to a full-demand type was realized with the "Nakamura Machi Bus" in Shimanto City, Kochi Prefecture. Furthermore, the "Odaka e-machi Taxi" in Minamisoma City, Fukushima Prefecture, attracted attention as a system utilizing IT technology and became the trigger for nationwide popularization.

Demand-responsive transport has a wide range of operation forms, from services close to ordinary shared-ride buses to services close to taxis. Those close to buses are called semi-demand types, and those close to taxis are called full-demand types.

In the spectrum of operation forms, as route forms and reservation deadlines are brought closer to those of taxis, the operating cost per passenger increases sharply at some point. I have advised municipalities working on the introduction of demand-responsive transport to choose a system just before the operating cost surges. However, municipalities tend to restrict route forms too much, while users try to make the reservation deadline too close to the time of boarding. As a result, there are many cases of failure where excessive investment in IT systems makes them financially unsustainable.

Whether demand-responsive transport can be operated cost-effectively depends on whether passengers can be successfully combined into a single vehicle by adjusting times and routes. Looking nationwide, examples of securing usage of several or more people per trip are limited to a handful, such as Iida City in Nagano Prefecture, Kikuchi City in Kumamoto Prefecture, and Togo Town in Hyuga City, Miyazaki Prefecture. Common features of these few good examples include responding to trip chains such as "Home → Hospital → Shopping → Home" rather than a simple pick-up/drop-off concept even in depopulated areas, the municipality identifying a middle ground between full-demand and semi-demand that fits the region, and collecting a certain amount of fare necessary for business continuity.

However, even in the aforementioned good examples, the harsh reality is that the cost-recovery ratio remains at around 30%. Nationwide, the subsidy per user exceeds several thousand yen, and there are many cases where providing fare subsidies for general taxis would be better in terms of both convenience and finance.

One problem hindering the success of demand-responsive transport is the resistance of users to the act of making a reservation. It is understandable that the elderly feel pressure regarding this.

Recently, attention has been focused on the concept of MaaS (Mobility as a Service), which integrates multiple transportation modes and facility uses into easy-to-use smartphone reservations. If one-stop reservations covering trip chains can be made, resistance to the reservation itself may be reduced. Furthermore, if there are advancements such as reliable connections with railroads and trunk buses when a reservation is made, one-stop integration where a medical appointment at a hospital simultaneously reserves demand-responsive transport, and automatic arrangement of return trips if a medical examination is delayed, it will lead to a re-evaluation of demand-responsive transport.

In Japanese buses, deregulation took place for chartered buses in 2000 and for shared-ride buses in 2002. Although many arguments suggest that this accelerated route abolition, the reality is different. Although the law was changed so that the start of service moved from a license system to a permission system (routes and timetables are subject to business plan approval) and fares moved from an approval system to a maximum fare approval system (lowering fares is a notification system), the ease of entry and service changes has hardly changed unless it becomes an administrative lawsuit. The actual growth rate of the number of operators was larger in the five years immediately preceding deregulation than in the five years after deregulation for chartered buses (buses for group tours, corporate, and school pick-ups). As for shared-ride buses, new entries have been extremely few even after deregulation. Two years ago, competition between a new entrant and an existing operator on one route in Okayama City became an issue, but such cases are rare except for immediately after deregulation.

Regarding trends in route abolition, it is difficult to judge the impact of deregulation because accurate statistics such as the coverage rate of villages by bus routes are not taken regularly. Comparing the distance of route abolition immediately before and after deregulation, route abolition has decreased after deregulation. From quantitative information, it can be said that deregulation somewhat delayed the decline of buses. I speculate that the reason it is often not perceived that way is because the structure is such that abolition issues are increasingly covered by the media as municipalities have begun to listen to residents' intentions and reorganize buses based on regional transportation plans.

When talking about maintaining public transport, not just buses, opinions are heard that only Japan operates on a self-supporting basis and that this is due to the negligence of the Japanese government. This is half-wrong as a story about local buses. The first misunderstanding is that people often ignore the existence of various so-called hidden subsidies, such as the reduction of and exemption from the diesel fuel oil tax and the practice of recording compensation for silver passes distributed by municipalities to the elderly as fare revenue. The second is that while overseas the subsidy rate is higher in urban areas than in rural areas, Japan is completely the opposite, and people often compare only urban areas at home and abroad.

The ratio of fare revenue to operating costs, called the farebox ratio, for Japanese shared-ride buses is about 80%. The remainder depends on government subsidies. This farebox ratio is considerably higher than in Southern Europe or North America, but when I investigated previously, it was at the same level as rural areas in both the UK and Finland.

Regarding subsidies, people tend to focus only on the level, but the method of delivery is also important. Japan places emphasis on following formalities even for policies concerning lifelines like buses. In other words, the external forms such as the route shape and usage rate of the buses eligible for subsidies are determined, and national subsidies in particular strictly prescribe these. Therefore, even if one tries to make improvements such as running a direct service to the main gate of a high school only for morning trips or making a detour to the hospital entrance only in the morning, the usage rate of the remaining trips will decrease, making it impossible to receive subsidies.

There are many cases where subsidies are received by increasing the apparent occupancy rate by running morning outbound and afternoon inbound trips as deadhead operations without carrying passengers. It is true that there may be few users for morning outbound and afternoon inbound trips. However, there is a transportation demand for healthy elderly people who have moved to town to go see their vacant homes or fields.

The policy of subsidies for buses has been refined since the 1970s while expanding the scope of decentralization. It could be said that it was a testing ground for financial decentralization.

Until fiscal 2000, buses were maintained in a form where the three levels of government—national, prefectural, and municipal—provided coordinated subsidies. From fiscal 2001, depending on the route form, the national government mainly took responsibility for trunk lines and municipalities for branch lines. Prefectures often support services in areas that fall outside national policy. However, the relationship between the three levels of government is not complementary. The fact that routes do not connect at municipal and prefectural borders, which is frequently shown on the TV program about local bus travel mentioned at the beginning, can be said to be one manifestation of this problem.

Due to the 2018 law for promoting work-style reform and its supplementary resolutions (especially those of the House of Representatives), it has been decided to shorten the working hours of drivers of buses and other vehicles starting in 2024. Currently, a specialized committee of the Labor Policy Council has begun work on a comprehensive revision of the "Standards for Improvement of Working Hours," which specifies the driving hours of drivers in detail.

A particular issue within this is the interval between the previous day's work and the next day's work. Under current regulations, this can be shortened to 8 hours. By taking a long lunch break, a driver can work from the first bus to the last bus. At the committee, opinions were expressed that the interval should be extended, and discussions are continuing.

Although it is unclear what the conclusion will be at this point, after 2024, it may become difficult to operate all routes in the same way from morning to night, or to operate on Saturdays and Sundays at the same level as during the day on weekdays. On the other hand, working conditions for drivers may improve, and the driver shortage may move toward a resolution. While it seems unavoidable that the number of services themselves will be reduced somewhat, the adoption of labor and driving time regulations that are easy to follow, along with the creation of nationwide standards for operation patterns and timetables, may cover that negative impact.

The quality of Japan's bus network and its operational efficiency can be said to be at a level that can be boasted internationally, at least regarding local buses. As an important means of transportation for residents nationwide that supports an aging society, I hope that new bus services will be born without relying solely on demand-responsive transport.