THE CASE FOR FARES REFORM
The railways (and the world) are in a very different place from 1993, when the Railways Act set out the considerations for the franchising authority to determine “rail fares are reasonable”. It upheld the ‘interests’ of rail users and protected them through ticketing, but it made no mention of any wider considerations such as growing rail’s modal share to reduce pollution or carbon.
It is therefore pertinent, in considering what a fares structure created on a blank sheet might look like, to ask such fundamental questions as:
■ What do we want the railways to do - for the economy, society, and the environment?
■ What are the strategic objectives? To maximise revenue or volume?
The answers to those questions will inform fares policy and influence judgements over the ratio of industry costs borne by passengers and taxpayers.
Since 2004, it has been government policy to make passengers pay a higher share of the costs of running the railways, while freezing fuel duty for motorists since March 2011 at an annual cost to the Treasury of about £9bn a year (according to the Institute for Fiscal Studies and amounting to over £100bn).
Assuming a usable timetable, the cost of fares is the most significant influence on the number of passengers and revenue. Railways have high fixed operating costs, and it is much easier to defray them by increasing revenue than by trimming costs, even though there is great scope for reducing maintenance and renewals costs.
The sources of frustration and confusion with fares are well known: the sheer number of options; anomalies such as two singles being cheaper than a return; the saving that can be achieved by split ticketing; regional discrepancies; varying peak hours; and conditions attached to tickets.
The degree of confusion and complexity is writ large in the cases cited by Barry Doe in RAIL, where passengers have been wrongly denied access to a particular train through platform staff’s ignorance of the regulations.
It was to address these shortcomings that the Rail Delivery Group worked with Transport Focus to produce Easier fares for all: The Rail Delivery Group’s proposal for a more transparent, simpler to use, modern system of tickets and fares. After consulting over 20,000 people and 60 groups representing nearly 300,000 organisations, 84% said the current system was not fit for purpose.
A NEW TICKET STRUCTURE
Word has it that the DfT and Treasury are considering gradualist tinkering. But the RDG and others have advocated a more radical approach at this watershed moment in Britain’s railways.
“We need a new fares structure to make it understandable, and a new internally consistent pricing structure so that split ticketing opportunities are no longer endemic,” says Mark Smith.
“This should eliminate anomalies where A-B + B-C is cheaper than A-C for a given ticket type, although it will be hard to eliminate split ticketing entirely. You will still have situations where instead of a peak fare for the whole journey, you buy a peak ticket to the point when the train becomes off-peak and an off-peak ticket beyond.
“But by starting again with logical and consistent pricing, you can reduce the prevalence of split ticketing which is even being offered by retailers such as Trainline, and which undermines consumer trust.”
