Bigger is not always better. The GTHA transit system comprises hundreds of routes with thousands of staff, providing a wide range of services. While a single operator might achieve some economies of scale, experience with large organizations in the public sector suggests that smaller delivery organizations can be more accountable and more efficient.
Local bus services act as feeders for longer distance trips, but many passengers will always be making local trips, to schools, shopping, and recreation. It makes sense for local government agencies, appointed by elected officials, to determine routes, stops, and service standards. Logically, each local municipality also provides operating subsidies, although a portion of these can be offset by a dedicated share of the provincial gas tax. Each operator seeks to serve the local residents who fund it, and will naturally be less interested in providing services to the wider region.
GO was created because no individual municipality had the incentives or the resources to operate inter-regional services. GO is a provincial agency that is currently managed by a board appointed directly by the provincial government. In the past, GO has been governed by a board representing the constituent local municipalities.
VIA Rail Canada and Greyhound mostly serve longer distance passengers but also carry small numbers of trips within the GTHA, for example, to and from Oshawa and Burlington. Various smaller companies also operate specialist public transit services within the GTHA, for example, the express bus linking Pearson Airport and downtown Toronto. These services are generally considered to be “commercial,” with fares covering costs and even generating profits. VIA receives a subsidy from the federal government, but this is mostly required to support transcontinental and “remote” services.
The Province (through Metrolinx) and the federal government provide about half of capital subsidies for municipal transit services, and all funding for GO. Special funding was allocated for development of the Spadina subway extension to Vaughan.
Metrolinx was created in recognition that the fragmented structure was not working. For transit to attract more riders across the region, it requires greater funding, and better integration than the individual municipal operators would deliver. There is nothing wrong in principle with Toronto’s two-tier structure, with Metrolinx concerned with regional issues and with each municipality operating local services. But Metrolinx has failed to use its powers to ensure that the local operations are coordinated to deliver regional benefits.