Travellers will no longer travel for free after eight journeys in a week on the state's public transport system but will instead pay half price for those trips, after the Baird government adopted a key recommendation from NSW's pricing regulator.
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However, Transport Minister Andrew Constance has put a freeze on fares until July next year and kept in place existing fare bands for the state's Opal ticketing system.
Following widespread concern from community groups, Mr Constance has rejected the regulator's advice to raise the daily fare cap for Gold Opal card holders from $2.50 to $3.60 and tighten the eligibility.
While he also decided against lifting the Adult Opal daily fare cap, he has adopted the Independent Pricing and Regulatory Tribunal's recommendation to change the weekly travel reward system.
Instead of receiving free travel after eight paid journeys, commuters will gain a 50 per cent discount on fares after eight paid journeys during a week.
Mr Constance said the change struck a balance between providing an incentive for people to use public transport and allowing a "more sustainable system".
"Around 70 per cent of customers are not reaching the reward, meaning a majority of customers aren't receiving any benefit," he said.
The government has also adopted the Independent Pricing and Regulatory Tribunal's recommendation that commuters who change modes of transport in the one journey – for example, switch from a bus to a train – get a $2 "transfer discount" against the cost of paying twice.
The rebate from September 5 will be $1 for holders of Opal cards for seniors, pensioners, children and other people eligible for concessions.
Commuters will need to transfer to another mode of transport within an hour of tapping off to gain the rebate.
Labor leader Luke Foley said there would not be a fare freeze for five-day-a-week commuters who would face a 12.5 per cent increase as a result of changes to the travel rewards scheme.
"Those people who are doing the right thing catching the train to and from work every day are still going to be slugged the hardest," he said.
He accused the Baird government of a political fix in freezing overall fares in order to protect their Coalition colleagues in the federal election campaign – a point rejected by Mr Constance.
The Opposition also called on the government to reveal what would happen to fares for the rest of the three-year pricing period.
Greens transport spokeswoman Mehreen Faruqi said the end to free travel for commuters after eight trips in a week would drive down public transport use.
"This is a step backwards and a 50 per cent discount is simply not enough. People who are dependent on public transport rely on this rule for an affordable journey," she said.
She said the $2 rebate for people who use more than one mode of transport in a journey was also not enough.
However, Mr Constance said half-price travel after eight trips and rebates for switching modes would continue to encourage people to travel on public transport.
The regulator calculated that $150 million of free journeys were taken in the past year under the scheme whereby commuters paid for the first eight trips in a week, and then travelled for free.
A significant number of the 1256 submissions IPART received on Opal fares were opposed to increasing the daily cap for Gold Opal cards from $2.50 to $3.60.
The Combined Pensioners and Superannuants Association commended the government for not raising the cap.
The Gold Opal card represents one of the state's few concessions based on age that is universally available.
In its final report, the regulator had said it believed the increase was affordable and noted that the cap had not increased for 11 years, while pensions had risen by 74 per cent over the same period.
The last increase in fares for travel on trains and ferries was in January last year, while for buses and light rail it was 2014.
