It's Cash First And Passengers Second

[whole diary]

[Lee]

A strong opinion from a Bath Chronicle letter writer (link below.)
http://www.rmtbristol.org.uk/2007/02/its_cash_first_and_passengers.html#more

[grahame]

Prior to the new December timetable coming into effect FGW^▸ (First Great Western) stated on their website that the changes were being implemented having carried out "extensive consultation with passengers and user groups". This is disingenuous.

It would be more appropriate to state that it was carried out following extensive consultation with its accountants.

I think that First did carry out extensive consultations with passengers and user groups.

The SRA^» (Strategic Rail Authority - about) specification that was made from April to June 2005 and although it was technically sent out to consultation it went out only to groups with prior interests and not to individual railways customers; the result (and you can see it was planned to be such from some FOI^▸ (Freedom of Information) revelations) was only a tiny number of responses.

The result of this minimal consultation and a lot of other matters going on at the time was a draft timetable for the new francise that I heard one well-respected commentator describe as "not fit for purpose".   And so First undertook what they desribed as the "biggest consultation of its type ever" and, yes, it probably was.  Why did they do it?   Perhaps in an attempt to shift blame away from themselves.   And some excellent changes did get made.

However ... there was a long way to go from "not fit for purpose" through to "good", and a variety of limitations - some goverment based, some from First's accountants no doubt, some because their first commitment is to shareholder, meant that in many cases the very act of consulting was as far as it went.  In the case of the line I use (TransWilts), for example, requests for the one remaining morning train to be moved a little later, and for the one remaining evening train to be moved a little later were, I'm sure read ... but the outcome was the opposite.

[CJ Harrison]

(from the letter)
Your correspondent, Mick Stanley (Letters, February 1), has hit the nail on the head in saying that the recent December timetable instigated by First Great Western is based on shareholder satisfaction rather than that of its customers.

It is inaccurate to suggest that the December timetable was instigated by First. It wasn^t. The Department for Transport instigated the changes.

I also take issue with the, albeit thinly veiled and indirect, suggestion that it isn^t possible for a private company with shareholders to run a good railway service. This is an oft repeated statement and one that is a total fallacy.

Over the longer term, a private company has got to deliver a steady and continuous growth in profits to satisfy both shareholders and the City. It is only possible to delivery such growth by satisfying customers. Cutting costs to the detriment of customer service certainly delivers a short term profits boost, but it doesn^t deliver sustainable growth ^ if only because existing customers eventually desert the service and it becomes increasingly difficulty to attract new ones because of a poor reputation. The ultimate consequence of such a position is that it becomes very hard to grow the top line (or revenues) and having already undertaken a cost cutting exercise the company has nowhere to turn to grow the bottom line or profits. And that is precisely why no sensible private company looks after shareholders to the detriment of customers.

When properly managed, cost cutting does, of course, have a part to play. And so it should: it makes things cheaper for customers and provides more money for future investment as well as allowing a better return for shareholders who, incidentally, are one of the sources for future capital investment. But it isn't the engine of growth of most private organisations.

I accept that today^s railway is run on a short term basis and this is, indeed, one of the central causes of many of the current problems. But the short term nature is not a problem caused by private businesses it is a political problem brought about by an unsound franchising structure and a government that refuses to provide any long term strategic direction.

[grahame]

I also take issue with the, albeit thinly veiled and indirect, suggestion that it isn^t possible for a private company with shareholders to run a good railway service. This is an oft repeated statement and one that is a total fallacy.

[etc]

I accept that today^s railway is run on a short term basis and this is, indeed, one of the central causes of many of the current problems. But the short term nature is not a problem caused by private businesses it is a political problem brought about by an unsound franchising structure and a government that refuses to provide any long term strategic direction.

I'm in agreement with you that, yes, a private company can provide a good railway service. Also that the current woes are very much caused by the system and how it's operated rather than uniquely by the private company.  But I don't think you'll find that any party is completely faultless if you look to aportion fault.

The big question is not "how did we get here" but "how can we move forward to an appropriate situation for all the interested parties, including but not limited to the customers of the railway" and much of the answer relates to how the TOC^▸ (Train Operating Company) / DfT^» (Department for Transport - about) balance short term financial and long term development goals.   

Strategy one: Take off peak hour trains now to save money outgoing, raise fares to generate money incoming, and withdraw / render unusable by condition changes cheap fares that sell well.

Strategy two: Ensure good capacity for popular services in order to grow those services, look after customers with excellent trains and responsive and helpful staff, and if there's a case where a customer is morally right but has acceidentally got caught by the complex fare system (for example) don't charge a penalty fare, have him pay again, or have the police march him off the station like a criminal.

[SusanW]

Yes, there has been much confusion as to who was responsible for the timetable changes. When we asked Richard Rowland (regional director for the Oxford area) about this he said that the basic timetable was provided by the DfT^» (Department for Transport - about) when the franchise was up for bids. Operators had to bid to provide this specific timetable. After the bid was won, the train company could then add trains to the timetable in order to run a good service.

Obviously FGW^▸ (First Great Western) didn't add that many trains to the basic timetable. The question is, who at DfT is making the decisions about the basic timetable and what are they basing their information on?

Susan
Ox Rail Action

[grahame]

The basic timetable was set by the SRA^» (Strategic Rail Authority - about) (strategic rail authority) before it was disbanded late in 2005 ... and much of the information in it was based on reports such as Jacobs from April 2004, which looked at traffic figures from up to 2 years previously and then made growth assumptions based on the number of travellers requiring to move in general, rather than railway growth history and projections.

This may all sound a bit "nit picking", but it resulted in some information on which decisions that turned out to be the wrong ones were made. 

For example, the West Wiltshire to Swindon train service had been enhanced in 2000, and was growing at a compound rate of between 8% and 35% per annum depending on what measure you take. However, Jacobs used a 0.8% per annum figure.   Looking forward from 2002, five years to 2007 and then through to the end of the franchise in 2016, there's a huge difference between 0.8% and 35% compound - so a huge difference in what's appropriate and what's been provided.

Footnote -
0.8% compound growth for 15 years - traffic levels rise to 1.12 times the original figure
8.0% compound growth for 15 years - traffic levels rise to 3.17 times the original figure
35.0% compound growth for 15 years - traffic levels rise to 90 times the original figure