Looking forward to 2016 and beyond - a view of priorities

[whole diary]

[grahame]

From the Yorkshire Post (opinion section):

Proposals to change and hopefully improve the railways^ infrastructure support, today provided by Network Rail, is one of the main topics to have come out of 2015.

Known as the Shaw Review, it will examine how the railways can be better managed, financed and supported with a more effective targeting of resources.

Network Rail operates the safest railway in Europe, yet at the same time it also operates one of the busiest; the UK^▸ (United Kingdom) rail network has experienced the highest growth in the EU^» (European Union - about).

The statistics are striking. The number of train journeys made each year has more than doubled since the late 1990s.Some 1.65 billion passenger rail journeys were made in the last 12 months, compared with 801 million in 1997.

This means rail travel in Britain is hitting the same figures as seen in the 1920s, when the Flying Scotsman was introduced. But this is happening on a network half the size.

People make an average of 24.7 train journeys each a year, a 60 per cent increase from 1998 when private operators took over running UK train services from British Rail.

The growth in journeys is thus faster than it is in France at 25 per cent, Germany at 23 per cent and the Netherlands at 10 per cent over the same period. This raises huge challenges such as squeezing more and better trains on the network to cope with demand and also addressing overcrowding. But in itself it reflects a huge policy and sector success.

The average price paid per passenger mile has increased by 6.7 per cent, adjusted for inflation since the mid-1990s, and the profit made by operators has fallen from 3.6 per cent of revenue in 1997 to 2.3 per cent last year.

Consequently, the demand for better services has been growing, with rail passengers consistently complaining about annual price rises and overcrowding.

Having set the scene, the author goes on to look forward ...

When John Major privatised the railway, he promised three things: competition, innovation and investment.

He said competition would drive innovation and investment, but there is still too little on-track competition.

The new body which emerges from the Network Rail review must therefore better encourage and deliver greater third party investment into rail infrastructure and decide how to make the most effective use of that investment.

The potential here for the North and the Government^s Northern Powerhouse ambitions is clear, especially as the Government prepares to deliver on more devolution of power for the region. Why shouldn^t local authorities have more influence on future rail services?

Against initial Whitehall opposition, new open access services, which compete with franchises across the North such as Grand Central and Hull Trains, are enthusiastically supported by local authorities in the North for the services they deliver.

These train companies have grown new markets at their own risk; they have a growing and loyal passenger base. More regional powers can and should encourage more open access rail services.

It is important to remember that local authorities and devolved bodies in the North can speak for and represent passengers and communities; Whitehall civil servants cannot.

Those in the South East have always benefited from their transport network being the one used by the very mandarins and policy-makers in charge of it; consequently, they have enjoyed almost blind attention and support.

More devolution can help rebalance this anomaly. It should also lead to more innovation and collaboration on ticketing and fares; a contactless ^Oyster^▸ (Smartcard system used by passengers on Transport for London services)^ card for the North is years overdue.

Outside of the South East, Britain^s railways are still too reliant on almost Victorian ideas, such as paper tickets and outdated infrastructure. Smart ticketing and the Oyster card have been working in London for nearly 15 years, but there has been no policy drive to deploy it elsewhere. This must now change. Some Londoners would argue that even Oyster is now obsolete.

There are still stretches of the North^s rail network with ancient pull-lever signalling and elderly out of date track layout. This leads to congestion and delays as the railways grow.

Electrification, modern signalling and better track designs will allow for faster, longer and better trains. This also applies to rail freight, which has huge potential. George Osborne is right to believe that better railways are key to delivering his Northern Powerhouse ambitions.

If there are five priorities for the railways in 2016 they have to be: delivering more on-track competition; encouraging more innovation; real devolution of rail powers; clear progress on rail electrification; and fewer committees and working groups.

A growing railway is a nice 
problem to have, but never under-estimate Whitehall^s ability to get in the way.

Written by Tony Lodge, a Research Fellow at the Centre for Policy Studies and author of Rail^s Second Chance ^ putting competition back on track published by the Centre for Policy Studies.

How much do the issues raised by Tony Lodge mirror into the South West and South Wales?

[ChrisB]

Contactless/Oyster^▸ (Smartcard system used by passengers on Transport for London services) need completely barriered stations and the cost of installation/staffing them is the stalling factor, I'm sure. And either needs finding through higher fares or increased taxpayer subsidy (through lower franchise payments) to pay for them. 2.3% profit is a small return for any TOC^▸ (Train Operating Company) investment

[TaplowGreen]

Contactless/Oyster^▸ (Smartcard system used by passengers on Transport for London services) need completely barriered stations and the cost of installation/staffing them is the stalling factor, I'm sure. And either needs finding through higher fares or increased taxpayer subsidy (through lower franchise payments) to pay for them. 2.3% profit is a small return for any TOC^▸ (Train Operating Company) investment

...........rather than the usual leap to the conclusion/blocker that someone else has to pick up the tab, bear in mind that initial investment in the technology and savings on ticket office staff costs/ticketing infrastructure will lead to bigger profits in the long run.

Effectively, the whole (or virtually whole) cost of providing paper ticketing systems will be eliminated - I wonder how much that currently costs?

[IndustryInsider]

Oyster^▸ (Smartcard system used by passengers on Transport for London services) is in use at stations like Hayes and West Drayton where there are no barriers, just validation machines.  Couldn't they be adapted to accept contactless bank cards?

[JayMac]

So TG, do you expect every GB^▸ (Great Britain) station to be fitted with a card reader? Berney Arms? Corrour? Sugar Loaf?

I agree though that not every station needs to be staffed or barriered as ChrisB suggests. There are plenty of unstaffed and/or unbarriered stations where Oyster^▸ (Smartcard system used by passengers on Transport for London services)/Contactless is accepted.

But I disagree that a National Rail smartcard scheme can work with the current fares system. The system barely copes at the moment with minor changes. Witness FGW^▸ (First Great Western)/GWR^▸ (Great Western Railway) messing it up when they made changes to fares on the Cotswold Line. Witness FGW/GWR being unable to get rid of the Reading 'inbound peak' bug from online systems.

Without a radical overhaul of the fares system, Pay As You Go smartcards are, I believe, impossible to introduce. How does the origin station card reader determine your destination or routeing to apply the correct restriction or even the correct fare? Say I tap in at Bristol TM^‡(resolve) intending to travel to Waterloo via Salisbury. What will I be charged? The system will have no way of knowing whether I've taken the correct route. I could go via Reading (higher fares) and just 'forget' to tap at my interchange.

How will day and period returns work? All fares would have to become singles for a PAYG^▸ (Pay as you go) smartcard. Day and period singles are very often ^1 or less than the return. Will those making return journeys be expected to pay nearly double, or will the singles be halved?

What about maximum journey times? They'd need to be pretty flexible to allow for delays.

How does one buy a cheap Advance and load it from the comfort of their home? How is the PAYG credit deducted from the smartcard for such a transaction?

How do you prevent someone tapping in at their home station, with just a few quid on their PAYG smartcard, but exiting at a unbarriered station hundreds of miles away? Onboard checks every few stations to make sure sufficient credit is held? Not easy on DOO^▸ (Driver-Only Operation (that is, trains which operate without carrying a guard)) services.

Oyster/Contactless PAYG is great on a relatively closed system such as TfL^» (Transport for London - about) with either flat or zonal fares. But on a system like National Rail, currently with thousands of pairs of stations, hundreds of time/route restrictions, dozens of fare types, it just won't work without a radical overhaul and massive simplification of the fares system. And if such an overhaul were considered then it should be done before PAYG smartcard rollout.

Season Ticket smartcards? Less problematical as has been shown in the South East.

[ellendune]

The barriers to pay as you go cards are:

1) The ^30 contactless limit.
2) The complexity of the fares system. 

I put them in that order because you for more than very local journeys the contactless limit will mean essentially that you are going to have to load a ticket anyway. 

You could load a card with pre-authorised amount first. Then use contactless I suppose, but that would be another step. Only when you have cracked that does the ridiculous fares system become a problem.   

[grahame]

So TG, do you expect every GB^▸ (Great Britain) station to be fitted with a card reader? Berney Arms? Corrour? Sugar Loaf?

Looking at the station stats for the year to March 2015, 15% of stations (392 out of 2540) had 35 or fewer people per day joining trains, and they accounted for less than 1 passenger joining in 750.   In many cases, those are on what were known as "pay train" lines and payments are logically made (and swiping done?) on train not on platform just as at present - fewer trains than stations involved!

What about maximum journey times? They'd need to be pretty flexible to allow for delays.

They would also be pretty flexible to allow for break of journey on the return ... think I'm right in saying that if I have a return that's valid for a month, in most cases I can stop for a week along the way if I fancy doing so?

But on a system like National Rail, currently with thousands of pairs of stations, hundreds of time/route restrictions, dozens of fare types, it just won't work without a radical overhaul and massive simplification of the fares system.

I'm inclined to agree ... as a technical person I ask "how could this be done" and implementing it with the current fares regime is - well - I can't see howI would do it!

[ChrisB]

No returns possible in Oyster^▸ (Smartcard system used by passengers on Transport for London services)/Contactless. Singles only, even on TfL^» (Transport for London - about).

And swiing on-train /at barriers isn't currently possible either

[TaplowGreen]

.......well as I always say to my teams, you've identified some problems, now suggest solutions! 

[JayMac]

A single operator system would be a start...

[ellendune]

A single operator system would be a start...

How would that help?

Many of the anomalies started in the BR^▸ (British Rail(ways)) days.

A single fare setter would be a start though. Perhaps ORR^» (Office of Rail and Road formerly Office of Rail Regulation - about)?

I think a formula based system would be best.  I suggest a fixed fare for each piece of track based on congestion. Add up the fares for each length then you get the fare for the journey.  Not sure how this would work with more than one route though!

[Bmblbzzz]

A smartcard system might not be possible but a smartphone system certainly would. Paper tickets could be almost done away with ^ retained for those who insist on paying by cash or cheque, which will mostly be the elderly, kids, foreign visitors and those on incomes too low to get a bank account (who obviously won't be making many journeys anyway) ^ with most people having tickets sent to their phones, displaying all the current data: departure, destination, fare, etc. After all, National Express coaches have been doing this for at least five years.

[TaplowGreen]

A smartcard system might not be possible but a smartphone system certainly would. Paper tickets could be almost done away with ^ retained for those who insist on paying by cash or cheque, which will mostly be the elderly, kids, foreign visitors and those on incomes too low to get a bank account (who obviously won't be making many journeys anyway) ^ with most people having tickets sent to their phones, displaying all the current data: departure, destination, fare, etc. After all, National Express coaches have been doing this for at least five years.

....as have a lot of airlines, it's good to see the railways trying to catch up at last.

[JayMac]

A single operator system would be a start...

How would that help?

I said it would be a start. Not an overall solution.

A single fare setter is also an excellent idea. TfL^» (Transport for London - about) do the fares with private companies providing many of the services on which Oyster^▸ (Smartcard system used by passengers on Transport for London services) is used. I've long said that tendered fixed fee services on National Rail would be better (best though, IMHO^▸ (in my humble opinion), is a single operator) than the current franchise model.

[Tim]

Contactless/Oyster^▸ (Smartcard system used by passengers on Transport for London services) need completely barriered stations and the cost of installation/staffing them is the stalling factor, I'm sure. And either needs finding through higher fares or increased taxpayer subsidy (through lower franchise payments) to pay for them. 2.3% profit is a small return for any TOC^▸ (Train Operating Company) investment

I suspect that the real profit is higher than this but for political reasons is hidden in other companies belonging to the ToCs owner.  I don't know how FGW^▸ (First Great Western) does it, but if I were their accountant I would suggest that they structure their business so that FGW's profit are reduced by costs charged by other First group owned companies such as the firm that owns some of the Powercars, First Info who runs Customer Services, their ticket fraud prosecution unit, the firm who runs rail replacement coaches.  If profit appears in those companies accounts it benefits the same shareholders but helps FGW look less rapacious than it is.