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26-30 railcard survey - plans to bring in new restrictions

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Bletchleyite

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They could however use the findings to determine how a 31-59 National Railcard could work. Even if it forbids usage before 10am and is significantly more expensive to purchase, few would complain as it still would offer a better discount than before.

I would pay a considerable sum of money, possibly over £100 (and possibly even more if it was by monthly direct debit), for a version of the Network Railcard with the same restrictions the existing one has but valid on all TOCs nationally, FWIW.
 
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AM9

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Consider a journey from Stevenage to London Terminals:

Anytime Day Return £23.30
7 Day Season £99.10
Monthly Season £380.60
Annual Season £3,964

A season ticket is poor value for this journey and many people buy daily tickets if they work from home one day a week.

A season ticket only makes sense if you purchase an annual and at almost £4k is a significant sum for someone aged 26-30 in 'generation rent' towards the start of their career when earnings are at the lower end of the scale. Even £23.30 for a daily ticket is high so the 26-30 railcard offers the opportunity to reduce the cost of an Anytime Day Return to £15.40. This is far better value than an annual season ticket and meets a Government aspiration to do something for 'generation rent'.
Hi Hadders. I know that we disagree about whether season tickets are good value, but as you've brought the comparison of SVG to STP/KGX into the discussion, I'll mention this:
For the type of travel that seasons are designed, i.e. Five days per week except a sick/holiday allowance, the £3964 annual season represents an Anytime return journey to London Terminals for £17.08. That is a discount of more than 26%. An Off-Peak 'Cheap' Day Return ticket for the same journey is £18.40 (just a 21% discount) and with a B1 restriction, bars commencing the up journey before 09.30. Then there's a Super Off-Peak Day Return ticket for that journey at £17.90 (a 23% discount) with a TN restriction that bars arrival in London before 10:54 and also bars return travel in the evening peak.
Given that the railway doesn't need any more travellers in the peaks* the sale of Anytime season tickets discounted below the price of very restricted off-peak tickets where passengers travel at the convenience of the railway using spare capacity sounds like a pretty good deal at the expense of off-peak travellers to me.

* Excepting the current situation with very limited travelling to work, of course it may be that the volume of commuters is reduced permanently through homeworking. That would benefit the railway greatly with less congestion, better use of (maybe less) rolling stock, and an opportunity to introduce more comfortable trains with less emphasis on gross capacity with an aim to capture more of the leisure market.
 

Hadders

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Hi Hadders. I know that we disagree about whether season tickets are good value, but as you've brought the comparison of SVG to STP/KGX into the discussion, I'll mention this:
For the type of travel that seasons are designed, i.e. Five days per week except a sick/holiday allowance, the £3964 annual season represents an Anytime return journey to London Terminals for £17.08. That is a discount of more than 26%. An Off-Peak 'Cheap' Day Return ticket for the same journey is £18.40 (just a 21% discount) and with a B1 restriction, bars commencing the up journey before 09.30. Then there's a Super Off-Peak Day Return ticket for that journey at £17.90 (a 23% discount) with a TN restriction that bars arrival in London before 10:54 and also bars return travel in the evening peak.
Given that the railway doesn't need any more travellers in the peaks* the sale of Anytime season tickets discounted below the price of very restricted off-peak tickets where passengers travel at the convenience of the railway using spare capacity sounds like a pretty good deal at the expense of off-peak travellers to me.

* Excepting the current situation with very limited travelling to work, of course it may be that the volume of commuters is reduced permanently through homeworking. That would benefit the railway greatly with less congestion, better use of (maybe less) rolling stock, and an opportunity to introduce more comfortable trains with less emphasis on gross capacity with an aim to capture more of the leisure market.

I agree with your analysis. Where I think we disagree is that a person at the start of their career, travelling from Stevenage to London everyday, is probably earning far less than (for example) someone in their late 50s. There was much talk in the media about the need to do something to help the 'under 30s' or 'generation rent' as they're often referred to.

The 16-25 Railcard offered some relief to 'high value' commuting costs and now the 26-30 Railcard does as well. The Government and Rail Industry would have been well aware of the cost of this and the potential effects when the 26-30 Railcard was launched.
 

AM9

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I agree with your analysis. Where I think we disagree is that a person at the start of their career, travelling from Stevenage to London everyday, is probably earning far less than (for example) someone in their late 50s. There was much talk in the media about the need to do something to help the 'under 30s' or 'generation rent' as they're often referred to.

The 16-25 Railcard offered some relief to 'high value' commuting costs and now the 26-30 Railcard does as well. The Government and Rail Industry would have been well aware of the cost of this and the potential effects when the 26-30 Railcard was launched.
Given that the railway is from the point of ticket sales a profit seeking industry, if Government wishes to display largesse, - in this case wishing to be seen to help under 30s, then it should funded to the level of increased cost to shield the TOCs. As the Government has chosen be generous at the expense of commercial companies, it is quite justifiable for them to take steps to make the offer of reduced fares cost neutral. Clearly the principle of giving commuters in general, fares at discounts that mean they are sold are below cost, and then effectively loading non-controlled leisure business fares with that cost, has been part of franchise deal pricing for decades. Those who benefit from discounted travel through season tickets really should stop claiming that they are overcharged and that their custom is more valuable than that leisure travellers when the railway has stated many times that it just isn't true. There are a few members of RUK who regularly argue along those lines.
 

kieron

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I agree with your analysis. Where I think we disagree is that a person at the start of their career, travelling from Stevenage to London everyday, is probably earning far less than (for example) someone in their late 50s.
Some are, some aren't. If you want to means test a railcard, though, why not just do that, rather than trying to use age as a proxy for income?
 

Deerfold

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Some are, some aren't. If you want to means test a railcard, though, why not just do that, rather than trying to use age as a proxy for income?

Presumably because it's far slower, harder and more expensive to means test.
 

bussnapperwm

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I'm a 26-30 railcard holder, and I know that if they put the price up, or decide to add more restrictions, I'll more than likely be switching to either NX, megabus, or just doing less out of Midlands journeys altogether
 

Doctor Fegg

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Is it? For commuting, you should buy a season ticket.

Except season tickets, as currently available, are a legacy of the way people used to commute.

They are not suitable for modern working patterns, which frequently involve working from home, job-shares, flexible hours, and so on. Which is why there are now commuter WhatsApp groups where members alert each other when advance tickets go on sale so they can snap them up.

Thus far the rail industry's response to this appears to be a selection of underwhelming carnet products offering an 0.001% discount or something. You can't blame people for looking out for alternatives.
 

kieron

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Presumably because it's far slower, harder and more expensive to means test.
You lose something in admin costs, but you gain by not wasting money on giving cards to people who could easily afford the full fare.

The median 30-34 year old taxpayer earned less than 15% more than the median 25-29 year old one in 2017-8 according to the ONS (compared with 27% for 25-29 against 20-24), so a 25-29 railcard is a rather inefficient way of targeting less well off people.
 

WesternLancer

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I think it is of note that the Railcard was announced by a Govt Minister (not the industry as a promotional product) and that was the Chancellor in 2017 - this is what he said at the time (ok not much on the detail but)

"For those who don’t stretch to a private jet, I can announce a new railcard, for those aged 26-30.
Giving 4.5 million more young people a third off their rail fares."

Quoted from here:
https://www.gov.uk/government/speeches/autumn-budget-2017-philip-hammonds-speech

Of course its T&C were diff to other railcard / similar products like the YP railcard IIRC adding to the confusing aspects of these types of products added to be the subsequent 16-18 railcard.
 

WesternLancer

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I wonder if the Government perhaps provided initial funding and now that's run out.
Quite plausible I suspect! And / or a diff ministerial team lobbied for it and now water has flowed under the bridge RDG decide to do a 'review'.
 

paul1609

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Down here on Romney Marsh 60 miles South East of London the building trades pay the average UK wage. Especially after Christmas theres a shortage of work through to the early summer. The local lads are an absolute bargain for the London Building Agencies where theres a shortage of labour. £80 for a one day travel card is nothing to these companies. The work often is not continuous, weather dependant and runs in to out of weekends. The season tickets are often beyond the ability of these guys to buy up front. If they're under 31 (most are) they'd be stupid not to have a £30 railcard that gives them £27 extra in their pockets for a days work.
 

WesternLancer

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Is it cheaper to do that than rent a room in London?
probably - but renting a room often not straightforward anyway and in theory you would have to sign up to a minimum 6 months rental contract with a landlord and the work might not last that long maybe, otherwise you would stay in B&b paid for by the contractor but even then it may be out of town so has a travel cost to it.
 

paul1609

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Is it cheaper to do that than rent a room in London?
Bear in mind that Ashford International is second stop 34 mins from St Pancras on peak trains. The Romney Marsh Road A2070 is a fast 60 mph single carriageway road practically from outside the station. Home will be as fast as digs in many suburbs and you may be told theres no work tomorrow.
 

FenMan

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You lose something in admin costs, but you gain by not wasting money on giving cards to people who could easily afford the full fare.

The median 30-34 year old taxpayer earned less than 15% more than the median 25-29 year old one in 2017-8 according to the ONS (compared with 27% for 25-29 against 20-24), so a 25-29 railcard is a rather inefficient way of targeting less well off people.

Please don't underestimate the bureaucracy required to implement means testing (IT infrastructure, appeals panels, arbitrators etc) or the difficulties in assembling the evidence to "convince the man" (gig workers, people with more than one job and so on). It would be a huge waste of scarce resources. Far cheaper to accept that a blunt instrument can never be precise, but is "good enough".

It is exactly this reason why UKGov started getting very nervous when the BBC said it could no longer fund free TV Licences for over 75s and that means testing would have to be an option to identify those in the target group in genuine need.
 

35B

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Please don't underestimate the bureaucracy required to implement means testing (IT infrastructure, appeals panels, arbitrators etc) or the difficulties in assembling the evidence to "convince the man" (gig workers, people with more than one job and so on). It would be a huge waste of scarce resources. Far cheaper to accept that a blunt instrument can never be precise, but is "good enough".

It is exactly this reason why UKGov started getting very nervous when the BBC said it could no longer fund free TV Licences for over 75s and that means testing would have to be an option to identify those in the target group in genuine need.
There are other ways of handling that if the item in question is a benefit - the way that child benefit is taxed being an example. However, the principle you set out is absolutely valid.
 

Bletchleyite

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Please don't underestimate the bureaucracy required to implement means testing (IT infrastructure, appeals panels, arbitrators etc) or the difficulties in assembling the evidence to "convince the man" (gig workers, people with more than one job and so on). It would be a huge waste of scarce resources. Far cheaper to accept that a blunt instrument can never be precise, but is "good enough".

You can also handle means testing through the tax system, which is a lot easier as it already exists so there is no real cost in doing so even if it does seem a bit of a "money go round". Give it out then tax it back again.

A good example of this is the way the Swiss tourist tax usually gives you free local public transport for the duration of your stay.
 

Deerfold

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probably - but renting a room often not straightforward anyway and in theory you would have to sign up to a minimum 6 months rental contract with a landlord and the work might not last that long maybe, otherwise you would stay in B&b paid for by the contractor but even then it may be out of town so has a travel cost to it.

I've seen a few contractors staying in Youth Hostels at £10-£15 a night in central London.
 

AM9

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You can also handle means testing through the tax system, which is a lot easier as it already exists so there is no real cost in doing so even if it does seem a bit of a "money go round". Give it out then tax it back again.

A good example of this is the way the Swiss tourist tax usually gives you free local public transport for the duration of your stay.
That's actually a good idea. Issuing of a 26-30 Railcard would involve supplying a valid NI number and the address that the number was recorded against. Tax levied would be zero up to the maximum income deemed needy of supplementing. Thereafter a band tapering to full tax based on the average total savings that all cardholders would benefit from. It might get complicated if it was necessary to determine what the 'work' journeys were of each card holder.
 

Bletchleyite

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That's actually a good idea. Issuing of a 26-30 Railcard would involve supplying a valid NI number and the address that the number was recorded against. Tax levied would be zero up to the maximum income deemed needy of supplementing. Thereafter a band tapering to full tax based on the average total savings that all cardholders would benefit from. It might get complicated if it was necessary to determine what the 'work' journeys were of each card holder.

That's a bit overcomplicated, to be honest. I was speaking more generally about means-testing things like benefits.
 

35B

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That's actually a good idea. Issuing of a 26-30 Railcard would involve supplying a valid NI number and the address that the number was recorded against. Tax levied would be zero up to the maximum income deemed needy of supplementing. Thereafter a band tapering to full tax based on the average total savings that all cardholders would benefit from. It might get complicated if it was necessary to determine what the 'work' journeys were of each card holder.
Or just impute a notional value to the saving, based on modelling of averages?
 

Deerfold

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Dunno what sort of hostels you are staying in but even dorm beds are a lot more than that in Central London for most of the year.

It's a few years since I was doing it regularly so they have gone up a bit, but looking at random weekdays in September (third week) there's plenty under £20.

There's 19 under £15.
 

paul1609

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It's a few years since I was doing it regularly so they have gone up a bit, but looking at random weekdays in September (third week) there's plenty under £20.

There's 19 under £15.
Not many contractors can book their accommodation 6 months in advance I would suggest.
 

Deerfold

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Not many contractors can book their accommodation 6 months in advance I would suggest.

I thought looking for the next month or two would be silly. July and August are usually higher.

My experience has been that booking a couple of weeks in advance gave similar prices to booking months in advance.
 

FenMan

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You can also handle means testing through the tax system, which is a lot easier as it already exists so there is no real cost in doing so even if it does seem a bit of a "money go round". Give it out then tax it back again.

How would that work for the self-employed, gig workers and, a more extreme example, Henry and Henrietta who both love working as interns while being amply funded by their rich parents? There are timing and data collection issues with the first two examples while the third example should fail a means test but probably wouldn't.
And it wouldn't be HMGov paying for means testing. The costs would be loaded onto RDG members who would be very likely to quickly draw the obvious conclusion that it might be better to leave things alone.
 

AM9

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How would that work for the self-employed, gig workers and, a more extreme example, Henry and Henrietta who both love working as interns while being amply funded by their rich parents? There are timing and data collection issues with the first two examples while the third example should fail a means test but probably wouldn't.
And it wouldn't be HMGov paying for means testing. The costs would be loaded onto RDG members who would be very likely to quickly draw the obvious conclusion that it might be better to leave things alone.
Despite your stereotyping of various social and economical groups by assuming representative names, the tax system does not have much interest in whether parents pay for things once they are over 18 or out of full time education. Trying to draw conclusions about a benefit based on an individual's tax liability being unfair (in your eyes) is futile. Income tax is generally a fair way of funding the public purse, but not only are there some injustices that are difficult to address, but there are plenty of individuals who continually 'game' the system, but abandoning means testing is not a panacea for making it perfect.
 

FenMan

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Despite your stereotyping of various social and economical groups by assuming representative names, the tax system does not have much interest in whether parents pay for things once they are over 18 or out of full time education. Trying to draw conclusions about a benefit based on an individual's tax liability being unfair (in your eyes) is futile. Income tax is generally a fair way of funding the public purse, but not only are there some injustices that are difficult to address, but there are plenty of individuals who continually 'game' the system, but abandoning means testing is not a panacea for making it perfect.

With apologies to anyone reading this thread who are called Henry or Henrietta, the substance of my argument is that imposition of means testing introduces significant costs to the equation. It would be members of the RDG that would incur these costs, unless Government is in the mood to spend taxpayers' money on policing a pricing/eligibility initiative managed, in the main, by private companies (I very much doubt that). So would RDG members want to fund a mechanism to determine which 26-30 year olds should be eligible to travel benefits or do what they are doing, which is questioning whether the current mix of benefits accruing to 26-30 Railcard holders should be updated now they have sufficient data to work out the true cost/benefit of this Government-sponsored pricing initiative?

The cynic in me says the RDG will approach the Government saying you told us to do this, we did it and here's how much it is costing us. So we can either cover our losses by diluting the benefits (which, politically, may be an issue for you) or you need to pay up.
 
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