How do Rail Travel Vouchers work from TOC point of view?

[Egg Centric]

How do Rail Travel Vouchers work from the Train Operating Company point of view?

I see two intuitive ways they could work:

1. It costs nothing for the TOC to issue a RTV. When accepted as a means of payment, the vendor receives no money. Advantage is less paperwork for everyone. Disadvantage is potential for lack of "fairness".

2. It costs the TOC the face price - or a percentage thereof - of the RTV to issue one and the money is paid into a central pool. When the RTV is used as payment, money is taken from this central pool and given to the vendor. Advantage is fairness. Disadvantage is that it's like giving cash compensation, but with more paperwork.

Neither approach makes much sense to me when compared to just giving cash compensation. #2 only begins to look attractive if we assume that a considerable % of RTV face value is wasted, either through expiration or overpayment. So what am I missing?

 

[Wallsendmag]

1 It depends who receives the voucher if it's the TOC that issued it then yes you are correct . If it is another TOC then the voucher issuing TOC pays the face value to that TOC.

 

[Haywain]

1 It depends who receives the voucher if it's the TOC that issued it then yes you are correct . If it is another TOC then the voucher issuing TOC pays the face value to that TOC.

Although in the first case any ORCATS settlement to other TOCs from the ticket sold still have to be met.

 

[thedbdiboy]

They are treated as Warrants for settlement. The full value of the RTV is debited by RSP from the issuing TOC. So once a TOC accepts an RTV, the value is debited to the TOC that issued it (which might be the same one). The revenue from the ticket purchased with the RTV is allocated in the same way as any ticket, so if it is used on a service for which the the TOC issuing the RTV gets an allocation, they will that money back, and the selling TOC will get the commission. The point is that they have real value, they are not just pretend money.

 

[tgrb]

So, what is the point???

Don’t get me wrong, I like them, I always get my delay repay etc as them and save them up for family outings!

 

[thedbdiboy]

So, what is the point???

Don’t get me wrong, I like them, I always get my delay repay etc as them and save them up for family outings!

If the recipient uses them on the services of the TOC that issues them, then theoretically they save the TOC money as they will have only lost the marginal cost of providing the service rather than the full cash value. However the increasing use of money for delay repay and other claims means that their use has diminished.

 

[Wallsendmag]

Although in the first case any ORCATS settlement to other TOCs from the ticket sold still have to be met.

Actually thinking about it now with auto settlement via the TIS I may be talking rubbish. That part has changed since my spell in our Retail Accounts office.

 

[Fawkes Cat]

So, what is the point???

If I have understood the explanations, the issuing TOC only incurs the cost when the voucher is used. And given that not all vouchers are used, that is potentially a saving.

Against this, of course, is the cost of issuing the vouchers and running the system, which may be enough to make the whole scheme uneconomic.

 

[paddington]

Although not really of benefit to individual TOCs apart from wastage, it forces you to spend the compensation on train tickets so all TOCs benefit as a whole.

 

[Hadders]

And there'll always be a proportion of vouchers that are never redeemed, for various different reasons.

 

[westv]

I am so glad we don't have to accept vouchers for delays anymore.

 

[Joe Paxton]

And there'll always be a proportion of vouchers that are never redeemed, for various different reasons.

I'd be interested to know the 'wastage' rates (probably not the right term) for RTVs. I'd assume it's commercially confidential information. I'd also assume TOCs prefer it if/when mislay your RTVs in your pile(s) of paperwork, not to be found until after the expiry date has passed!