Public versus private funding Japan

Toshifumi Ishiya from the Japan International Transport Institute spoke at length about private rail transit operators who play a key role in providing urban transit service in the Tokyo metropolis. Most private operators in Japan do not receive any operating subsidy from the government. However, their revenue streams are more diverse than just the fare box revenue. Many rail transit operators also developed land along the rail corridors and transit stations and were able to generate significant revenue from developed land uses, such as housing and recreation. This helped keep private transit operators profitable and free of government subsidies.Mr. Ishiya also spoke of the costbsharing formulas between central and local governments for capital expenditures in public transit. The recent Japanese experience in expanding urban and regional transit involves subsidies amounting to 35 per cent of the capital cost provided for by both central and local governments. Even the expansion of the high-speed rail service is subsidised partially by the local governments because they eventually benefit from improved accessibility resulting in higher local tax revenues.Even more important is the lesson about integrated transit service in the Tokyo region where privately and publically operated trains running above and underground share tracks, transit stations, fares, and fare collection systems. It is important for the commuter to avoid the hassles of transfers from one system to another, warned Mr. Ishiya. The Japanese solution is seamless integration of transit service where the commuter focuses on the journey and not on the jurisdictional constraints of transit operators.
Japan, though, is not alone in integrating diverse urban transit systems. After the unification of Berlin, transit systems from East and West Germany were integrated to offer seamless transit service to all citizens of the United Berlin. The S Bahn (surface rail) and U Bahn (underground rail) were integrated across Berlin overcoming challenges resulting from different rolling stock, different technology, and at times, different rail gauges.