Friday, 13 February 2009

Getting the Trains to Run on Time, and Gas Price Gauging: When the Market Doesn't Work, Maybe Legal Action Will

Talk of class action in the transportation domain this week. First a group of dissatisfied users of commuter trains want compensation for bad service on two lines where schedule changes and faulty equipment have wreaked havoc since the fall. Then a campaign by Radio-Canada’s morning man René Homier-Roy to do something about apparent price-gauging at the gas pump seems to be picking up steam.

Ridership has been increasing on suburban trains, and in an attempt to improve service, it seems that the Agence de transport de Montréal (a public agency) juggled schedules without thinking through the problem. In addition, there have been equipment breakdowns, in part due to very cold weather. The ATM admits there has been problems and is offering discounts on monthly passes for the next couple of months in recompense. But some commuters are not satisfied and are going to ask for some big bucks: $65 million.

With gas prices, the situation is more complicated. The CAA-Quebec has been keeping track of gas prices daily, noting the cost to the retailer and the price at the pump. In 2007 the difference was 3.3 cents a litre, but in 2008 it jumped to 5.7 cents in the Montreal area. “It’s very difficult to understand this,” the CAA-Quebec’s spokesperson Sophie Gagnon said Thursday, because gas retailers in smaller centers haven’t resorted to the same increase. One would think that in the much larger Montreal market, competition would bring down the difference, she noted. CAA-Quebec figures that a 4 cent profit margin would be fair.

Homier-Roy has been joking about a class action over gas prices for some time, but Radio Can/CBC rules about non-involvement in politics may mean that he can’t start one himself. Yet I can’t imagine that one of his many listeners won’t take up the fight.

Moral: the market doesn’t work, but maybe threats of legal action will.

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