Future Public Transport Contracting Strategy Development

Background

The Department of Transport and Main Roads (DTMR) plays a critical role in delivering reliable public transport services across Queensland. Among these are ferry connections to Coochiemudlo Island, the Southern Moreton Bay Islands (SMBI), and bus services on North Stradbroke Island—lifeline services for residents, students, and visitors. These routes support daily commuting, school transport, and tourism, making them essential for local communities and regional connectivity.

With all three contracts scheduled to expire in late 2025, DTMR identified an opportunity to review future service delivery models. The Department sought to understand whether integrating these services into the South East Queensland Integrated Mass Transit Area (IMTA) could improve customer experience and operational efficiency. It also wanted to explore whether bundling contracts might deliver administrative or cost benefits. This required a comprehensive assessment of regulatory frameworks, market dynamics, and economic implications, ensuring any future procurement strategy would be evidence-based and aligned with Queensland’s broader transport objectives.

The challenge was complex: each service operates under different contractual and regulatory arrangements, and the islands have unique demographic and demand profiles. DTMR needed clarity on the trade-offs between integration, bundling, and maintaining the status quo—while considering customer needs, financial sustainability, and long-term market development.

Our Role

NineSquared was engaged to provide independent economic and commercial advisory services to support DTMR’s strategic planning. Our approach was designed to deliver robust, data-driven insights through:

• Regulatory Review: Analysing the legislative framework governing ferry and bus services, including market entry restrictions, contract rights, and implications for integration.
• Integration Feasibility: Exploring pathways for incorporating services into the IMTA, including ticketing, fare structures, and operational impacts.
• Economic Assessment: Evaluating financial implications under multiple scenarios, including cost structures, revenue risk, and potential capital requirements.
• Procurement Options Analysis: Examining the implications of bundling contracts versus maintaining separate agreements, with a focus on market competition and service continuity.

Our evidence-based methodology combined economic modelling, stakeholder engagement, and scenario testing to ensure decisions were grounded in reliable data. By integrating demographic analysis, demand forecasting, and regulatory review, we provided DTMR with a transparent framework for comparing options. This enabled the Department to weigh customer benefits, operational feasibility, and financial sustainability without prescribing a single course of action—empowering informed decision-making for future procurement.