Better value fares, new ticketing options and aggressive marketing initiatives are needed to attract passengers back to rail after COVID-19. South Western Railway passenger won £5,500 in Touch Smartcard prize draw. Image by South Western Railway.
Until March we were all anticipating imminent publication of Keith Williams’ report on the future shape of our railways and especially recommendations on simplifying the currently labyrinthine train fares structure. COVID-19 has put all that “on hold”, with the government totally immersed in trying to keep us safe and prevent health services being overwhelmed. However the issues and concerns about fares won’t go away even if, as predicted, train ridership is substantially lower than that prior to March due to physical spacing measures and public fear of too close encounters.
About 55 million different fares are available in the UK and industry research has shown that only a third of passengers are “very confident” of being able to buy the best value ticket. The fares system has been largely unchanged for at least 20 years and hardly anybody inside or outside the rail industry doubts the need for major reforms.
Even before the Williams’ review team was established the Rail Delivery Group themselves had started consultations on their Easier Fares For All document, covering the type of reforms that might be desired and/or appropriate. Railfuture submitted a response detailing many reforms that needed to be at least considered.
In essence our response promoted the desire that fares should be seen by the general public as being ‘value-for-money’ and that whatever journey a passenger wished to make they should be confident that their fare was the cheapest possible for that journey at that time. Most of our aspirations revolve around so-called ‘walk-on fares’, that is the ticket you buy when you roll up at a station ticket office or ticket machine to travel straight away – the Off-Peak and Anytime range of tickets. These are also the tickets that you can buy to allow flexible travel arrangements rather than buying (usually) cheaper Advance Purchase tickets restricting you to specific trains on specific days out and back.
Value-for-money can mean many different things and may not mean universal cheaper travel than now – but hopefully never more expensive. However there are several reforms that would make some journeys less expensive. Most travellers know what train they will catch for the outward part of their journey but quite often aren’t sure which train they will use to return. At present this means buying a relatively expensive Off=Peak Return, or even worse a very expensive Anytime Return. Many train companies operate the ludicrous policy of making their Off-Peak Returns only a few pence more than the Off-Peak Single, making it not viable to buy an Advance for the outward journey and on OP Single for the return leg. We want this totally reformed so that it this purchase choice is always cheaper than an OP Return. At the same time we are totally opposed to this being achieved by doubling the price of the OP Return.
The second key issue is the way in which buying ‘split tickets’ can so often yield a much cheaper fare than buying a single through ticket. Chris Page details an interesting example of Wokingham to Hebden Bridge in his article ‘Clearer not Simpler Fares’ on our website (see link detailed above). For those not yet versed in the joys of ticket splitting this involves buying a ticket for each section of the journey. Chris suggests Wokingham to Reading, Reading to Manchester and Manchester to Hebden Bridge, saving in 2017 between £14 and £26 (depending on journey times). However if you are familiar with which Train Company sets sectional fares and you are prepared to research various options you can often find even cheaper options. For the Reading to Manchester section of the journey, splitting the journey into Reading-Banbury-Birmingham-Stoke-Manchester would save another £15 on a day return (2020 prices). Of course there is no need to change trains at the intermediate points, as long as the train stops at each, and Reading to Manchester is normally a through service (although not at present). It just depends on your willingness to spend time to save this amount and having a pocket large enough to hold between 12 and 20 tickets (20 if you want seat reservations from Reading to Manchester)! Ticket-splitting works really well for day returns and for journeys that involve part in peak time and part off-peak.
Our proposals for reducing the need to split tickets is for through journey prices to be made up of the sum of the cheapest sections. These fares are already held by the national fares database and every TOC uses them to offer fares outside their own area. Many rail industry insiders and observers recognise the validity of this approach but are concerned about the impact on train operators of possible revenue loss. On this a little more later.
These are only two of the issues on which we have been campaigning and there are many more:
- the excessive difference between peak and off-peak fares causing over-crowding on the first off-peak train;
- the excessive fare difference between standard and first class for not a great deal of extra comfort or service, creating over-crowded standard class and near empty first;
- the lack of day return fares for perfectly viable day return journeys;
- changes to worktime patterns rendering the use of traditional season tickets much less cost effective;
- the policy adopted by some train companies in offering a TOC-specific day return for local journeys a few pence cheaper than the all operator fare, enabling them to keep all revenue rather than having to share via the ORCAT system (our solution would be make them ineligible for revenue sharing for these journeys).
The elephant in the room is in-fighting between the Treasury and the Department for Transport. The DfT’s target is for any fares changes to be revenue neutral overall. However public pressure is to round down and eliminate the very high prices charged for walk-on fares, especially single fares and those between peak and the first off peak train, as noted above. The DfT seems to be aware that if the cheaper fares are raised there would almost certainly be a massive public outcry to any change. The Treasury is concerned that if prices are rounded down overall revenues will fall and TOCs will demand franchise re-negotiation and loss of income return. Our contention is that negotiation will be necessary anyway because for any significant changes to the fares system some TOCs might lose revenue whilst others gain.
Not only would the changes described be fairer to the travelling public, but we believe also that affordable walk-on fares would encourage more existing rail travellers to buy these rather than Advance Tickets because of their flexibility, especially for the return leg of their journeys, as noted above. Moreover off peak walk-on fares perceived as value-for-money may well encourage more travel and thus both these effects would reduce any revenue loss – perhaps even produce a small increase.
The publication of the Williams Review has been delayed because of this clash between the Treasury and the DfT. The analysis had been due for release as a white paper last autumn, but ministers will now only promise that it will be published by the end of July. We await developments with hope tinged with not a little scepticism.
With the present health situation, the expectation is that even when the crisis is over the number of passengers, especially in peak hours, is likely not to return to the pre-COVID level for several years – if ever. Many individuals and companies have discovered that working from home can be as productive as office-based working, especially avoiding long-distance journeys for face-to-face meetings. So the trend that was already apparent and affecting sales of traditional season tickets is likely to accelerate and business travel is likely to remain significantly lower. Furthermore sadly the level of unemployment is likely to be considerably higher than before March and further reduce the number of potential travellers. All this adds up to the need to attract a lot more people to travel by train, probably for leisure purposes. How can the operators do this? We anticipate that some train frequencies may be reduced. However the provision of attractive fares, even loss leaders, coupled with ‘aggressive’ marketing for lightly loaded services may well be the solution.
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