This paper titled, “Public Transport – An Essential Service”, asks the questions: (a) Is the contracting out of bus services by Government a truly competitive process? (b) Do the processes provide real competition, which ensures continuing and reliable transport services, which are cost efficient and which provide value for money to the tax payer? (c) Is it possible to provide real competition through the competitive tendering of transport services in such a labour intensive industry as public transport? (d) Does employment law in Australia and bus service contract terms limit true competition for transport services? (e) Would a declaration that public transport was an essential service make the process more competitive or would it infringe upon the internationally accepted human right to freedom of association? The paper looks at the legislative and contractual regimes in Australia and seeks to answer the questions posed above. An analysis is made of the process of tendering bus service contracts in Australia, including offering transport service contracts, formerly operated by public utilities, to private enterprises and the process of testing the market by way of tender in the renewal of existing privately operated service contracts. The proposition presented by this paper is that the contracting out process limits real competition, especially when passenger transport contracts in Australia require a successful tenderer to take on all the existing employees and all existing employment conditions, including rates of pay, rostering and hours of work. Furthermore, the paper espouses the view that the industrial laws of Australia hinder the ability of an incoming transport operator to negotiate with their work force for greater work productivity and cost efficiencies. It is suggested that Australian industrial laws, supported by the unalienable right to freedom of association make it almost impossible for an transport operator to negotiate a new industrial agreement (an enterprise agreement) without disruption to the transport services, placing the transport Operator potentially into default through unchecked industrial strike action (protected action) from Trade Union members, which causes an unacceptable disruption to services. A conclusion is provided which suggests that the current contracting out process is flawed because it propagates the problem and that a solution for true competition would be for public transport to be considered an essential service and therefore any successful contracted operator would be able to bid for a transport contract knowing that costs efficiencies would be able to be achieved through enterprise bargaining, unimpeded by the threat of stop work, which disrupts the transport services. Key Words: Competitive Tendering, Protected Action, Enterprise Bargaining, Industrial Relations, Freedom of Association, Public Transport an Essential Service.Institute of Transport and Logistics Studies. Faculty of Economics and Business. The University of Sydne
