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PAKULA DISCUSSES TTA CEO APPOINTMENT

Summary: Minister for Public Transport Martin Pakula and newly-appointed Transport Ticketing Authority CEO Bernie Carolan discuss Mr Carolan’s appointment, the roll-out of myki, discussions with Keane and Kamco, the structure of the Transport Ticketing Authority board and the Siemens trains’ braking issue.

MARTIN PAKULA:  All right, thanks, everybody, for coming today.

 Today I’m announcing a major change to the leadership of the Transport Ticketing Authority; a change that I believe will support the final roll-out of myki across all transport modes.

 When I started in this job just three weeks ago, I made it clear that completing the roll-out of myki would be my highest priority.  I’ve spent many hours reviewing the project, I’ve spent many hours testing the system for myself as a commuter.  I think it’s obvious that the Premier and I have been frustrated that the contractor has not yet met its contractual requirements to deliver myki, and we have made that crystal clear to the contractor, Kamco, and to its parent company, Keane.
 
 Yesterday I met with the international President and CEO of Keane, John McCain.  I was assured by him that Keane and Kamco have now deployed their best international experts here in Melbourne, and we’ve been assured by them that those people will be here around the clock, that they will stay on the job until the problems of myki are resolved.

 I now have confidence that Keane understands that this is their number one priority as a company; it’s certainly my number one priority as the Minister for Public Transport.  And it is crucial that Keane is as committed to myki as the Government is, and I’ve been given that commitment.

 The Government also needs to ensure that myki is ready to move into full operations phase when the roll-out across all of the modes is completed.  And, so, today, I am announcing that Bernie Carolan, the current head of the public transport marketing body Metlink, is the new CEO of the Transport Ticketing Authority, effective immediately.

 As the current CEO of Metlink, Mr Carolan already has overall responsibility for providing public transport users with coordinated information about ticketing, about fares, and about services.  And with many of the authority’s ticketing functions to be transferred to Metlink when myki is fully operational, Mr Carolan’s appointment will support the transition to full operations and, once the task is complete, he will return to his old role at Metlink.

 I think those of you who know Bernie Carolan know that he is a highly respected leader in the public transport industry, and I am certainly confident that he will give me the frank and fearless information and advice that I need as the Minister for Public Transport.

 To further support the roll-out of myki, I also intend to take steps to strengthen the board of the TTA, and decisions about that will be made at a later stage.

 I certainly want to take this opportunity to thank the outgoing CEO, Gary Thwaites, for his leadership of the TTA through a difficult period.  Gary oversaw the delivery of myki on regional buses and also its initial introduction on Melbourne’s train system.  But I am firmly of the view that new leadership is needed to complete the transition into full operations. 

We all know that this project has had its issues, but Victorians have shown that they are looking forward to using myki on all modes of transport.  To date, Victorians have registered more than 370,000 myki cards; that is a clear sign that the public will embrace myki as long as Kamco and Keane and the Transport Ticketing Authority can resolve the outstanding issues as quickly as possible.

So, thanks for being here, and I’ll now hand over to Bernie to say a few words.

BERNIE CAROLAN:  Morning, everybody.

 And I’ve really only got a very brief message today, and that is that I’m very pleased to take on this challenge and will bring all my experience and determination to see this project through to the status that it should be.

 I will have a very strong focus on customer outcomes, and that’s what the ticketing system is all about, after all.  And I absolutely appreciate that it’s a key part of my role to drive Kamco and Keane and all their contractors very hard to get to those same customer outcomes, in accordance with the contractual obligations that they’ve already got.

 So that’s all I want to say for the moment, but I think both the Minister and I are happy to take some questions.

REPORTER:  Mr Pakula, why did you sack Gary Thwaites?

PAKULA:  Gary, as I said, has done a very big job in terms of delivering what’s been delivered thus far, but myki is now moving from a project implementation stage into an operations phase, and it’s my view, the view of the board, and the view of the Department of Transport, that Bernie Carolan is the best man to take the Authority forward as we move into that phase.

REPORTER:  Gary Thwaites was a close colleague of DoT Secretary Jim Betts.  Should he go too?

PAKULA: Jim Betts is a passionate, dedicated, and very skilled public servant.  I could not have been more impressed than I have been in the last three weeks by Jim Betts and the dedication and the energy he devotes to his role as the Secretary of the Department of Transport, and I have no plans whatsoever to do anything of that nature, Clark.

REPORTER:  John Peoples is on the TTA board; he was appointed in 2007 because he was a technology expert.  Why isn’t he being replaced as well right now?

PAKULA:  The Authority… the leadership of the Authority and the implementation of the myki system fundamentally rests with the executive – the CEO – and I think Bernie Carolan, as the new CEO, is going to bring all of the skills that he has demonstrated as the head of Metlink to that role, and to ride this project to its conclusion.  I have said that, in the coming days and weeks, I’ll be looking to strengthen the board, but that’s a conversation for another day.

REPORTER:  Strengthening the board – does that mean [inaudible]?

PAKULA:  I think strengthening the board means bringing the best people onto the board.  The board has worked very closely with the current CEO and with government, but I think, as the new Minister, I’m entitled to look at ways to strengthen the board, and I think, over the next days and weeks, I’ll be talking to one or more individuals about their preparedness to join the board and to provide it with more leadership and direction.

REPORTER:  Is this going to speed up the introduction of myki on trams and buses [inaudible]?

PAKULA:  The introduction of myki on trams and buses will fundamentally be determined by the speed with which Kamco and its contractors can iron out the technical gremlins that have so far been a factor.  But what I think… what I expect from Bernie Carolan and the people that he will bring with him is a rigorous analysis of everything we’re told by Kamco, and a determination to ride the contractors as hard as possible ’til we get to the finish line.

REPORTER:  Do you think they’ve been telling you lies?

PAKULA:  I’ve only been the Minister for three weeks, but I think that it is self-evident that a number of the predictions that were made by the contractor in the past did not come to fruition.  So I think that is self-evident, and I think one of the things that Bernie and his team will bring to this is a very rigorous analysis of the information being provided by Keane.

REPORTER:  Do you think Kamco and Keane were getting an easy ride before you became Minister?

PAKULA:  No, I think Kamco and Keane have been wrestling with very difficult technical issues but, as we move into an operational phase, I think the TTA requires new skills and a new approach, and I think Bernie Carolan will provide that.

REPORTER:  When you say you’ll be talking to others to join, is that at the expense of the current serving [inaudible]?

PAKULA:  I don’t expect so, I don’t expect so, but they are decisions for another day.  The last day or two our focus has been on moving Bernie into this role, and I am very gratified that he accepted it, and I am very confident that the skills he will bring to this position will be the sorts of skills that assist us in getting myki rolled out as soon as possible.  But I think it is also incumbent on me – and entirely appropriate – to look to strengthen the board in any way I can.

REPORTER:  Bernie, on a practical level, what do you think you’re gonna bring to the job that hasn’t already been brought to the job over the past four years?

CAROLAN:  I’ll bring a great deal of experience in Melbourne’s public transport system and a great deal of determination to just see this through to the outcome it needs to be for passengers.  Metlink is a very customer-focussed organisation, and I’m a very customer-focussed individual.  So we really will bring just some new energy and some new teamwork to get this through to the outcome it needs to get to.

REPORTER:  What do you think a commuter… on a practical level, what do you think a commuter that knows... will be a difference of your regime from the previous regimes?

CAROLAN:  I mean, I’m sure that the commuters of Melbourne want myki to work.  They’re aware that smartcard ticketing systems work in many other cities around the world and even a couple of other cities in Australia, and they want it to work here.  So the approach we will bring is an understanding that that’s what the community and the customers want, and we’ll have a great determination to get to that outcome as soon as we can.

REPORTER:  How would you describe the roll-out of myki so far?  You’ve obviously been very well-placed to kind of see that; how would you describe the roll-out to this point?

CAROLAN:  I think the word that’s been used by the Minister, and I think the Premier, is the perfectly appropriate word, which is ‘frustrating’.  It’s been frustrating for everyone involved, and most of all, frustrating for customers, because there has been some false starts, if you like, and some promises that just couldn’t be sustained.  So, that’s extremely frustrating.  And we want to avoid that from here on; we want to be realistic and very thorough in our diagnosis of what needs to happen, and then make sure we can deliver it when we say we will.

REPORTER:  What deadlines have you given the contractor to fix the technical glitches?  And if they don’t make them, what are the penalties to them?

PAKULA:  I’ve indicated before that my focus is not on setting arbitrary deadlines.  What the customers expect is that when myki is rolled out on trams and buses, it works in a reliably consistent way.  And so the expectation that I have conveyed to Keane and to Kamco is that they will put every resource on this project, around the clock, until it is resolved. 

And in the meeting that I had, not just with John McCain yesterday, but with the global Vice President about 10 days ago, I made it perfectly clear to them that my expectation was that there would be no let-up, there would be no reduction in resources – in fact, the resources needed to be ramped up – whilst these technical gremlins were worked out of the system. 

Progress is being made, but the thing that I’m not going to get into is providing an arbitrary deadline which says that difficult technical issues will be resolved by a given date.  Because the nature of these problems is that a problem is identified, a solution is found, and a solution is then implemented, first on a smaller number of vehicles and then on a larger number of vehicles so that we can be sure that the problems have been rectified.

REPORTER:  [Inaudible] come a point when you have to dump myki if you don’t get a deadline and it doesn’t continue to work?  When will that be?

PAKULA:  The fact is that the current ticketing system, Metcard, is gonna reach the expiry of its logical life in a couple of years’ time.  There have been… there’s been enormous effort put into myki, enormous resources, and the public is using it on regional buses and on Metro trains right now.  I’m one of them.  And we have got some issues with trams and buses, with some technical issues, which I am confident the contractor is getting to the bottom of.  So that kind of conversation is not a helpful one.  My determination, and I know Bernie’s determination, is to ensure that myki works.

REPORTER:  [Inaudible] are using myki in Melbourne?  How many people… aside from the issue of how many cards are out there, how many people are actually using it at the moment?

PAKULA:  It differs from day to day, but I think in an average week, it’s somewhere between 10,000 and 20,000.

REPORTER:  What are the issues that you’ve talked about?  What are the issues that are continuing on buses and trams?

PAKULA:  I’ve said before, I’m not an information technology expert…

REPORTER:  You must be being told what the problems are?

PAKULA:  I’m coming to it.  I’m not an IT expert, so I don’t… I can’t explain it in the way that an IT expert could, but they are fundamentally matters of a technical nature which relate to things like dropout, some canyoning (*) issues, and as has been well-reported, some issues in the back office with some hold-ups in dataflow which mean that customers have had delays in their balances being evident to them when they’ve logged on to the website. 

So they’re the kinds of issues, and they’re issues that I am confident can be resolved with the right dedication of resources.

REPORTER:  Was it always the Government’s plan to get a new CEO when you moved to the operations phase?

PAKULA:  I can’t speak to what was always the intention.  I’ve been the Minister for three weeks, and the decision that I’ve come to, in consultation with the board and Secretary of the Department, is that as we move to this new phase, a new skill-set is required, and it’s a skill-set that I am absolutely confident that Bernie Carolan possesses.

REPORTER:  It’s a new decision… it’s a new decision, then?

PAKULA:  It’s a decision that’s been made by the board in concert with myself and the Secretary of the Department.

REPORTER:  Bernie, do you have a myki card?

CAROLAN:  Yes, I do.

REPORTER:  Do you use the train every day with it?

CAROLAN:  I actually commute by bus every day, and therefore I am not able to use it at the moment most of the time.  And that is one of the frustrations, that, actually, on some occasions it is useable – even though we’re instructing passengers not to use it on bus and tram – but, on other days, plainly it isn’t.  So that’s the sort of consistency and reliable customer service outcomes we have to deliver, so that it’s useable all the time, very reliably and very easily.

REPORTER:  And when did you sign up for your myki card, if you don’t mind me asking?

CAROLAN:  I signed up for mine around about last November when, if you like, some industry insiders were part of what was then a test group – deliberate test group – and I’ve retained mine and will be using it.

REPORTER:  Minister, when was Keane told about this change?

PAKULA:  It certainly wasn’t a part of the conversation that we had with Keane yesterday, and they may have been notified in the last little while, in the last half hour or so.

REPORTER:  You said that… obviously, you’ve only been in the job three weeks, but given the frustrations you have described, even though Metlink tickets do have a limited shelf life, are you confident that this is the right system for Melbourne?

PAKULA:  Absolutely.  Smartcard technology is the way of the future for public transport ticketing…

REPORTER:  But is myki the right smartcard?

PAKULA:  I’m coming to that.  Look, smartcard technology is the way of the future for public transport ticketing; it means that a customer’s experience is cashless and, when it’s working properly, it’s quicker and it’s much more convenient.  And smartcard technology can also do a number of other things. 

I do think it is important for people to remember that no smartcard roll-out has been without its gremlins, without its problems; the London system took nine years to roll out fully, the San Francisco system has been on the boil now for close to a decade, and myki is undergoing some gremlins in much the same way that many other systems around the world are. 

But as I said before, I am confident that Keane and its subcontractors are getting to the bottom of the problems, and we will have a very good transport ticketing system for Melbourne.

REPORTER:  How many commuters actually use public transport in a week?  You just said that 10,000 to 20,000 use myki.  What’s the overall figure?

PAKULA:  It’s difficult to establish discrete trips by individuals.  The reality is that over the course of a year, there are 500 million or so individual boardings of public transport; that includes train, tram bus and regional rail, so you can do the maths.

REPORTER:  Your other issue, I guess, is train brakes.  There’s a drivers’ meeting about the Siemens braking issue today.  Are you confident with what’s being done to fix the brakes?  I think the drivers say there’s [inaudible] software; do you want that looked at?

PAKULA:  Well, Metro are applying a system-wide solution to the issues with Siemens trains.  They haven’t just focussed on brakes, they haven’t just focussed on software; as you know, they’re focussing on track performance as well.  I think the important thing to remember is that the trains that have been returned to service have been passed fit to ride by an independent safety regulator, Public Transport Safety Victoria, and that is the best reassurance commuters and drivers can have – an independent safety regulator has overseen the tests and have given these trains the tick.

REPORTER:  [Inaudible] that they were talking about – the [inaudible]?

PAKULA:  Yes.

REPORTER:  Bernie, how much is it costing a year to run Metcard alongside myki?  That’s a very good disclosure.

CAROLAN:  Yeah, I’m not aware of that number, Clarke; I’d have to take that on notice.

REPORTER:  And who’s your replacement?

CAROLAN:  No, I’ve only been aware of this role for just a couple of days, and I’m still discussing what will happen at Metlink with the Metlink board, and that’ll be sorted out over the next day or so.

 

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