Railway subsidies: Worth it or not?

[Dave1987]

There are a lot of people in the press, twitter and on here who complain about the amount of subsidies the TOC's receive. My question to people is this:

Would you rather TOCs stopped operating services that are loss making or would you rather the same level of service was kept with the TOCs getting the subsidies to run services that run at a loss?

 

[YorkshireBear]

There are a lot of people in the press, twitter and on here who complain about the amount of subsidies the TOC's receive. My question to people is this:

Would you rather TOCs stopped operating services that are loss making or would you rather the same level of service was kept with the TOCs getting the subsidies to run services that run at a loss?

Have to look beyond the subsidies and see what happens to road congestion and general social happiness to see if they are worth it. In most cases yes.

 

[Wyvern]

Surely some costs that are labelled subsidy should be considered as investment, just as they are for the roads.

An what about subsidised bus services? Nobody seems to mention them.

 

[Harpers Tate]

The one thing I don't think has ever been made wholly clear is what the costs are of roads, vs. the revenue their users raise.

We are often quoted statistics about the Railway and how on average, passengers fares raise - 50% or whatever figure it is - of the cost of providing their journey.

I wonder what proportion of the total cost of running our roads - from building and maintaining to lighting, signalling, policing and so on - is raised by revenues from users including fuel tax, road tax, VAT on the various elements.

If one were to apply similar logic, the Humber Bridge would be on the list......

I have no doubt there are train services operating today that would scarcely be missed if they ceased. The obvious and immediate candidates are various "parliamentary" services - locally they would include Sheffield <> York locals; Sheffield <> Cleethorpes locals and, of course, Stockport > Stalybridge (or is it the other way around at present?)

Of course, another approach to these would be to make them into services that are of use.

I do believe that, particularly as regards many regional services, things could be done a lot better; mostly, more efficiently and more commercially - to narrow the gap between cost and income. Promotional fares to increase usage; modified working practices and so on.....

 

[34D]

Let's not forget that a good chunk of the subsidy goes on various 'luxuries'.

By this I mean things like enhanced salaries for drivers, salaries for teams that undertake things with minimal benefit (example, the teams that each operator has for delay attribution).

Due to things like TUPE we couldn't actually change any of these things, however I would like the next new line we open to be done on a 'low cost' basis, ie driver on £9 an hour, no paid breaks, no time and a half for Sundays, etc etc. Station staff could be one person staffing a combined ticket shop/newspaper stand/coffee bar.

I'm not staff-bashing here, I am just saying it would be interesting to try a low-cost venture as an experiment.

 

[DynamicSpirit]

I wonder what proportion of the total cost of running our roads - from building and maintaining to lighting, signalling, policing and so on - is raised by revenues from users including fuel tax, road tax, VAT on the various elements.

Indeed, that's a point that many people miss. I'm fairly sure that if you added up all the costs of the roads, including maintenance and a reasonable estimate for the environmental and noise-pollution damage that road vehicles cause, you'd find that even after allowing for road tax and fuel duties, drivers are being subsidised by the rest of the population. If you worked through the same exercise for airlines, you'd definitely find massive hidden subsidies resulting from airlines not having to pay for any of the environmental damage they cause. Yet almost no one ever mentions those.

 

[Goatboy]

A level of subsidy is crucial - there are almost no public transport systems in the world which do not receive subsidy. Without subsidy, most of our public transport could not operate and this would have a dramatic effect on the economy of the country as a whole.

Public transport is a public service and public services should be subsidised - thats pretty much the main reason we pay tax - to fund the provision of public services.

 

[Cherry_Picker]

It's an age old argument, isn't it?

Why should I subsidise the railway? I don't take the train.
Why should I subsidise schools? I don't have children who are at school.
Why should I subsidise hospitals? I'm not unwell.

Having functioning public services and infrastructure are a big part of having a country with a high quality of life. Throwing down a few quid in tax is the price we have to pay. If nobody pays any tax then the country ends up like Greece. Be careful what you wish for.

 

[Tomnick]

...however I would like the next new line we open to be done on a 'low cost' basis, ie driver on £9 an hour, no paid breaks, no time and a half for Sundays, etc etc....

How's this going to work then? Do you intend to have a dedicated link of drivers, sufficiently large to operate and provide spare cover for the new service? Sounds horribly inefficient to me. Why should they be paid significantly less than their colleagues, and have much worse conditions, for doing largely the same job? I'd imagine it'd quickly turn into an LM-esque situation, with drivers rapidly leaving to work elsewhere for fair treatment. Not that the union would take such a direct and substantial attack on drivers' pay and conditions without a tremendous fight - and quite rightly too.

 

[Hellfire]

Figures seem to suggest that drivers actually subsidise lots of other things but because the idea of a "road tax" disappeared decades ago it's difficult to work it out.

According to the Daily Telegraph's Honest John column motorists paid £27 billion in taxes in 2010, including road fund licence, fuel tax and VAT. In the same year the government spent £9.5 billion on road construction and maintenance.

That said I am very happy for my taxes to subsidise railways. They are more environmentally friendly and IMHO a much more civilised way to travel.

 

[Gareth Marston]

Figures seem to suggest that drivers actually subsidise lots of other things but because the idea of a "road tax" disappeared decades ago it's difficult to work it out.

According to the Daily Telegraph's Honest John column motorists paid £27 billion in taxes in 2010, including road fund licence, fuel tax and VAT. In the same year the government spent £9.5 billion on road construction and maintenance.

That said I am very happy for my taxes to subsidise railways. They are more environmentally friendly and IMHO a much more civilised way to travel.

NHS costs, police costs, fire brigade, pollution, cost to economy of grid locked roads its not a black and white equation like the road lobby try's to make out.

 

[tbtc]

Would you rather TOCs stopped operating services that are loss making or would you rather the same level of service was kept with the TOCs getting the subsidies to run services that run at a loss?

It really depends on what subsidies are required for certain lines.

You could argue that there's a social case for keeping some lines open, even if they they require subsidy, but some stations/ lines are there because of a demand that existed a hundred years ago and are only kept alive because it'd be too much hassle/ protest to close them.

I can't see the justification for keeping "parliamentary" services running, but then they probably only require a low amount of money in the grand scheme of things (compared to some of the other industry costs that are only there for historic reasons).

But, as we don't know the actual figures, we can't come to any real conclusion. For example, the Hope Valley stations are probably loss making, but how does that loss compare to other costs? If we abandoned them, would it save a penny off every ticket in the UK? Is a penny a price worth paying for them? These arguments are pointless without some statistics.

 

[Cherry_Picker]

And again, pulling in arguments from another thread we don't know what growth the future will bring. Once a line is closed it is very difficult to bring back, there were compelling arguments for closing the line into Marylebone and the north london line in the 80s, just look at how many journeys are made over them now.

If you want to move the debate to somewhere more rural then look at the east - west route which is going to reopen between Oxford and Bedford, people concede that closing that was probably a mistake even though it was thought a good idea at the time.

 

[tbtc]

I'm fairly sure that if you added up all the costs of the roads, including maintenance and a reasonable estimate for the environmental and noise-pollution damage that road vehicles cause, you'd find that even after allowing for road tax and fuel duties, drivers are being subsidised by the rest of the population

In which case you'd have to calculate the environmental and noise-pollution damage that trains cause, which would be an equally subjective number

 

[yorksrob]

In which case you'd have to calculate the environmental and noise-pollution damage that trains cause, which would be an equally subjective number

True, but then again, there are a lot fewer trains covering a much smaller area. Even taking into account the use of diesel, the railway would come out on top.

 

[GB]

By this I mean things like enhanced salaries for drivers, salaries for teams that undertake things with minimal benefit (example, the teams that each operator has for delay attribution).

TDA is big buisness and has the potential to earn the company a lot of money.

 

[455driver]

Let's not forget that a good chunk of the subsidy goes on various 'luxuries'.

By this I mean things like enhanced salaries for drivers, salaries for teams that undertake things with minimal benefit (example, the teams that each operator has for delay attribution).

I'm not staff-bashing here, I am just saying it would be interesting to try a low-cost venture as an experiment.

Well that didnt take long did it!:roll:

No of course you are not!

 

[34D]

How's this going to work then? Do you intend to have a dedicated link of drivers, sufficiently large to operate and provide spare cover for the new service? Sounds horribly inefficient to me. Why should they be paid significantly less than their colleagues, and have much worse conditions, for doing largely the same job? I'd imagine it'd quickly turn into an LM-esque situation, with drivers rapidly leaving to work elsewhere for fair treatment. Not that the union would take such a direct and substantial attack on drivers' pay and conditions without a tremendous fight - and quite rightly too.

A totally separate company for a new service, yes
--- old post above --- --- new post below ---

Well that didnt take long did it!:roll:

No of course you are not!

I'm just saying that with a totally new baseline, things could be possible (reopening etc) that aren't possible at present.

Why do you think the northern PTEs want to build new routes as tram or guided bus?

 

[Goatboy]

I wouldn't want to be a passenger on a train where the driver is paid just £9 an hour. If you pay peanuts, you get monkeys. You can earn that stacking shelves overnight in Tesco and driving a train is a far more safety critical role than that. Only a moron would take the level of responsibility that driving a train comes with in return for such a paltry wage and I don't want morons driving trains.

 

[A-driver]

Let's not forget that a good chunk of the subsidy goes on various 'luxuries'.

By this I mean things like enhanced salaries for drivers, salaries for teams that undertake things with minimal benefit (example, the teams that each operator has for delay attribution).

Due to things like TUPE we couldn't actually change any of these things, however I would like the next new line we open to be done on a 'low cost' basis, ie driver on £9 an hour, no paid breaks, no time and a half for Sundays, etc etc. Station staff could be one person staffing a combined ticket shop/newspaper stand/coffee bar.

I'm not staff-bashing here, I am just saying it would be interesting to try a low-cost venture as an experiment.

I'm interested by why you think that a divers salary is 'enhanced' and why it is a 'luxury'. Funnily enough I don't think that my pay is a luxury-it is a necessity and the reason I go to work every day! I don't thank my employer for their generosity in choosing to pay me and I doubt anyone else does either, in any industry!

Also, how are you going to get drivers on £9 per hour when all the others pay £25/hour? You will end up with those who can't make the cut with the more desirable operators and so increase incidents, need longer training etc as you couldn't be anywhere as selective as a company offering 45k can. Drivers take their job very seriously and take safety seriously as we know we will not get a job paying this much elsewhere. Pay them £9 an hour and you will end up with school levers who couldn't give a stuff as if they have too many incidents and get sacked they can just walk into a supermarket, employment agency, building site etc and just get another job on similar money.

Although you say that you arnt staff bashing you have shown that you have no idea where our salaries come from or what we are paid for/how competition works etc. and quite frankly, after reading the first sentence which describes rail workers pay as a 'luxury' it's actually impossible to take the rest of your post in any way seriously.

But nice to know that you wish we were on significantly less and don't like the fact that TUPE offers us some protection of our terms and pay! I suspect jealousy as I can't see any other reason you would be that keen on eroding our pay and conditions!

 

[yorksrob]

TDA is big buisness and has the potential to earn the company a lot of money.

Ah, but does it offer the taxpayer value for money !

 

[DynamicSpirit]

Figures seem to suggest that drivers actually subsidise lots of other things but because the idea of a "road tax" disappeared decades ago it's difficult to work it out.

According to the Daily Telegraph's Honest John column motorists paid £27 billion in taxes in 2010, including road fund licence, fuel tax and VAT. In the same year the government spent £9.5 billion on road construction and maintenance.

That said I am very happy for my taxes to subsidise railways. They are more environmentally friendly and IMHO a much more civilised way to travel.

Generally when I've seen figures quoted, they only cover direct expenditure - as is the case for the figures you've just quoted. The true cost of road transport is much greater than what the Government spends on maintenance. Many factors - like noise and CO2 pollution are hard to quantify but that doesn't make them less real.
--- old post above --- --- new post below ---

In which case you'd have to calculate the environmental and noise-pollution damage that trains cause, which would be an equally subjective number

Totally agree. Trains do cause damage and noise pollution as well, and that would have to be accounted for in any fair comparison.

That said, it's rather obvious that the damage per passenger-mile on a train is going to be far less than in a car.

 

[yorksrob]

One aspect of road transport costs which is often overlooked is the sheer volume of land they require. I‘m not talking about our ancient rights of way which we would have to have anyway, rather the amount of space taken up by motorways, by-passes, dual carriage ways , car parks etc that have grown up purely for motor transport. This is all land which becomes unavailable for other uses such as agriculture , housing etc and ultimately feeds into costs for everything else.

 

[Gwenllian2001]

It's an age old argument, isn't it?

Why should I subsidise the railway? I don't take the train.
Why should I subsidise schools? I don't have children who are at school.
Why should I subsidise hospitals? I'm not unwell.

Exactly, the vast amount of taxes raised through the selling of alcohol and tobacco products do not go towards better facilities for drinkers and smokers. Some of it will help treat consumers with related health problems but far more is just absorbed into general taxation just as duty on fuel; VAT; Income Tax and every other form of taxation. Whenever I hear some self righteous MP or political pundit mention 'Taxpayers money' I want to scream because everyone pays tax, of some kind or another, whether they are employed; on benefits or pensioners.

I cannot pretend that we live in a perfect society but, for the moment, it's the best we have and taxes help the wheels go round.

 

[455driver]

Refering to Delay Attribution-

Ah, but does it offer the taxpayer value for money !

No it offers naff all to the taxpayer and is just another (hidden) subsidy that the TOCs receive at Network Rails expense.

 

[Dave1987]

On delay attribution I have to say I hate the delay attribution merry go round that happens. The "please explain" that turns up in your pigeon hole for a three minute delay that has appeared on Trust and needs to be attributed to a certain depot or department. BUT I do understand why it has got to this stage. People expect services to run to time, some go mad if a service is even slightly late. When we have a society like this, the constant delay attribution and money merry go round is inevitable. I don't think a lot of passengers are aware that even very small delays are scrutinised. But the system can only be good for passengers.

 

[455driver]

But the system can only be good for passengers.

How so?

The passenger doesnt receive any sort of compensation until the train is (typically) 30 minutes late so all the "your train lost 2 minutes betwwen A and B" serves no useful purpose (for the passenger) at all.

DA was set up so any persistant delays could be sorted out, it was never intended to be the complete <deleted> it has become.

 

[yorksrob]

On delay attribution I have to say I hate the delay attribution merry go round that happens. The "please explain" that turns up in your pigeon hole for a three minute delay that has appeared on Trust and needs to be attributed to a certain depot or department. BUT I do understand why it has got to this stage. People expect services to run to time, some go mad if a service is even slightly late. When we have a society like this, the constant delay attribution and money merry go round is inevitable. I don't think a lot of passengers are aware that even very small delays are scrutinised. But the system can only be good for passengers.

To be fair, we had the passenger compensation element of it from the passengers charter. It‘s the repayments that go to the company which don‘t get passed on to the passenger that I object to.

I remember that on one occasion, a very expensive journey of mine was almost entirely bustituted due to engineering works. It took over an hour longer than the timetabled journey time. Did I get my already steep fare back ? No I did not. "Special" timetable apparently . Yet I've no doubt it would have been a nice little earner for the TOC concerned.

 

[transmanche]

But the system can only be good for passengers.

No, it's only good for certain parts of the railway industry and only came about as the result of the complex web of contracts required by rail privatisation.

How much of the approx £150M that TOCs receive in delay payments from Network Rail[§] is actually given back to passengers?

There are over 300 people working solely on delay attribution[*]. That's 300 salaries being paid for something that's not actually needed to run the railway

§ Source: The Brig Society, Radio 4
* Source: http://www.telegraph.co.uk/news/ukn...on-officers-to-avoid-paying-compensation.html

 

[Dave1987]

No, it's only good for certain parts of the railway industry and only came about as the result of the complex web of contracts required by rail privatisation.

How much of the approx £150M that TOCs receive in delay payments from Network Rail[§] is actually given back to passengers?

There are over 300 people working solely on delay attribution[*]. That's 300 salaries being paid for something that's not actually needed to run the railway

§ Source: The Brig Society, Radio 4
* Source: http://www.telegraph.co.uk/news/ukn...on-officers-to-avoid-paying-compensation.html

It benefits passengers because TOCs and Network rail are forced to do all they can to reduce delays or face financial penalties.

On the point of delay payments being given to passengers, how much delay do you think warrants compensation to passengers?