When you think about it the system is a bit strange. However pay as you go is promoted as offering better value than paper tickets so as long as you can buy a paper off-peak day travelcard that is valid for the rest of the day after 0930 then pay as you go will have to include evening peak fares in the off-peak cap
Which it does.
Oyster has to work to single journeys such that the price of a return can only be 2x the single fare. This is why many single fares in London went down considerably when Oyster PAYG was introduced, while the return equivalents were more-or-less the same. The challenge was how to design a system which maintained the price for a peak time return commute while still allowing off-peak travel in the afternoon. Not surprisingly it doesn't quite work for shorter journeys, but for the majority it does. If you travel each way in the peaks you will pay just about what you always did, but if you can time one journey outside a peak then you benefit from a reduction. If you make two journeys off-peak you will also pay around the same as the old off-peak return fare, however, it falls down when one of those journeys is in the afternoon peak. To cushion that blow the off-peak cap applies in the afternoon peak. The idea is that a single peak journey will not be more than the off-peak cap, so if added to a single peak journey in the morning it will either be the old anytime return or an anytime travelcard (if it caps). However, add it to another off-peak journey and the chances are the off-peak cap will come into play.
There are losers, particularly people making a return journey in the outer zones completely within the evening peak where the zone 1-6 off-peak cap is not going to be reached (please can we have the 2-6 cap back, Boris?), but on the whole it works.
