Fare Allocation

Discussion in 'Fares Advice & Policy' started by william, 10 Apr 2015.

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  1. william

    william Established Member

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    I was wondering how fares are currently distributed between operators, particularly for feeder lines.

    For example, how would a £160 return fare between Bishop Auckland and London KX be allocated between Virgin/Stagecoach and Northern?

    Is it based upon route miles or operating costs?
     
  2. yorkie

    yorkie Administrator Staff Member Administrator

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    These threads are worth a look:

    More results available via Google search for orcats site:railforums.co.uk

    --- old post above --- --- new post below ---

    It's not in any way related to the costs. Unfortunately we are not privy to the secret way in which ORCATS works.

    We're told that it's timetable driven, with a bias towards direct trains (or perhaps fewer changes) but there is talk of some sort of allowance for the fact that some people may choose to take an alternative permitted route or break their journey, so it's possible that CrossCountry, Grand Central, TPE etc would get a small amount, but it's all very mysterious. If Train Companies are unhappy with the allocated amounts, they may be able to challenge it.

    The good news is revenue doesn't determine validity (despite some people occasionally claiming otherwise) so we don't have to worry about it.
     
  3. william

    william Established Member

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    Yes, let me explain the rationale for asking.

    If it is based upon route mileage doesn't this unfairly favor long distance operators who will be able to operate more efficiently (i.e less costs per mile).

    Whilst it may be recognised that feeder lines may require higher subsidies as a result it will no doubt lead to less investment in the feeder network, which in turn will be counter-productive to the long distance operator.

    Time for a rethink?

    Forgive me if this has been done to death already.
     
    Last edited: 10 Apr 2015
  4. yorkie

    yorkie Administrator Staff Member Administrator

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    It doesn't sound like it, based on Article on ORCATS.

    The more I read about it, the more questions I have. It doesn't make much sense to me. But I know it's claimed by industry professionals to be not fit for purpose and was not designed for the privatised era.
     
  5. kieron

    kieron Established Member

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    One reason we should care about is because ORCATS affects TOC profitability, and governments sometimes uses TOC profitability to justify their policy decisions.

    The example quoted in the Article on ORCATS thread suggests that some ORCATS allocations are decided based on people's expected behaviour when travelling between another pair of stations in the same flow, rather than between those actually on the ticket.

    It's only one route, and the secrecy surrounding ORCATS means we can't tell if it was unusual or even if it's still calculated like that. If this is a common failing of the system, it could mean that (for instance) Northern pay a large annual subsidy to Virgin, with all that flows from this.

    There's always the option of an agreement outside ORCATS, but why would Virgin sign up to one?
     
  6. Haywain

    Haywain Established Member

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    Realistically, how much of that journey could be made using Northern services?
     
  7. kieron

    kieron Established Member

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    For Burscough Bridge-Sutton Coldfield, it's typically just over 9% (as per the old thread). For Wigan-Birmingham, you'd have to look at very early and very late trains. For instance, the first southbound journey opportunity on a Sunday involves Northern to Stockport and then Crosscountry to Birmingham, getting in almost an hour before the first direct train.
     
  8. Haywain

    Haywain Established Member

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    But "that journey" was Bishop Auckland to London King's Cross, not anything you have referred to. Your reply is, therefore, a little unhelpful. But thanks anyway.
     
  9. kieron

    kieron Established Member

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