Passenger Numbers, Autumn 2022

[Dai Corner]

And a lack of willingness to look at why those costs are so high - eg leasing costs etc

How would you reduce leasing costs? Have the Government raise taxes, cut services or borrow to buy the leases out?

I don't really see the relevance of the point about the railway being limited in what it can do. People have known for nearly two hundred years that the railway doesn't do a door to door service, yet with competitive fares and a decent service, passengers still turn up.

But they're not turning up in the places where the capacity is. The railways have 'the wrong type of passengers', to coin a phrase. Of course they'll use a subsidised service but the big question is whether that's the best use of taxpayers' money when there's a threat of being dragged into a war, patients are waiting many hours for emergency treatment or years for planned treatment and people fear they won't be able to afford to heat their homes, to name three current concerns.

 

[yorksrob]

How would you reduce leasing costs? Have the Government raise taxes, cut services or borrow to buy the leases out?

But they're not turning up in the places where the capacity is. The railways have 'the wrong type of passengers', to coin a phrase. Of course they'll use a subsidised service but the big question is whether that's the best use of taxpayers' money when there's a threat of being dragged into a war, patients are waiting many hours for emergency treatment or years for planned treatment and people fear they won't be able to afford to heat their homes, to name three current concerns.

For starters, I would make TOC's offer any stock back to the government before disposal. That way stock could be allocated to strengthen services for the maintenance cost.

As for your second point, yes of course people are concerned about those things, but we need a working transport system. The railway is the only real public transport alternatives for so many journeys, as the strikes illustrate.

 

[Bald Rick]

And to put it in context, the UK defence budget in 2021 was £71bn, health and social care £191bn, education £100bn, social care & pensions £298bn.

So for a nationwide service that around half the population will make use of at some stage, the rail budget is by no means a bloater.

I do like the way that when facts are presented to show that your earlier assertions were wrong, you just change your position without any acknowledgement. Very deft, just like a politician.

For the service it provides, I’m afraid the rail budget is very much a ‘bloater’ in the eyes of Government. You can’t compare the value of the service provided to rail passengers with that of universal healthcare, or universal education, or the state pension. I could argue that around 100% of the population will use the nationwide telecoms network, which has precisely zero Government budget, but that would be equally facetious.

 

[Dai Corner]

For starters, I would make TOC's offer any stock back to the government before disposal. That way stock could be allocated to strengthen services for the maintenance cost.

I was under the impression that the DfT controlled what happened to stock? Do you mean the leasing companies rather than the TOCs? The Government could buy it for scrap value, do it up and use it, of course. The Welsh Government have done just that with Mk4 coaches.

As for your second point, yes of course people are concerned about those things, but we need a working transport system. The railway is the only real public transport alternatives for so many journeys, as the strikes illustrate.

It's really not, except for peak-time commuting into the largest cities. Other modes, or just not travelling at all, are the alternatives. That's why the strikes have had little impact to the vast majority of people. The only person I know who's noticed is a friend who wants to visit her mother but can't drive due to a medical condition. I'm going to see if she'll let me take her in the car.

 

[43096]

For starters, I would make TOC's offer any stock back to the government before disposal. That way stock could be allocated to strengthen services for the maintenance cost.

What? The vast majority of stock isn’t owned by the TOCs so they can’t offer it. In any case, if the Government wanted stock being disposed then a) they have the opportunity to lease it (or direct a TOC to lease it) well before then and b) they could bid to buy it if they so wished.

Has it occurred to you that the reason stock is going for disposal is because the DfT don’t want it? The owners don’t scrap stuff on a whim; they will explore every avenue for re-lease or sale before they get to the scrap option.

 

[yorksrob]

I do like the way that when facts are presented to show that your earlier assertions were wrong, you just change your position without any acknowledgement. Very deft, just like a politician.

For the service it provides, I’m afraid the rail budget is very much a ‘bloater’ in the eyes of Government. You can’t compare the value of the service provided to rail passengers with that of universal healthcare, or universal education, or the state pension. I could argue that around 100% of the population will use the nationwide telecoms network, which has precisely zero Government budget, but that would be equally facetious.

Where have you shown my earlier assertions to be wrong ? You said that after Hatfield, subsidy was near 50:50, and I suspect it would have risen after that, rather than arriving straight at the current position.

Actually, the railway is as close to a universal service as one can get as everyone has the opportunity to use it (and most will at some stage).

The fact that in any year a good proportion of people won't use it is surely reflected in the fact that its subsidy is much less than those other services.

The telecoms network does make a profit. If there comes a time when that falls below the cost of the infrastructure, society may also need to make a judgement call on whether it will be necessary to subsidise it.

I should also add that just because our dysfunctional attempt of a government sees rail subsidy as bloated, dousn't mean we all should.

 

[geoffk]

This is the key point from the last few days - the top rate of tax is a rounding error when it comes to the public finances (the cost estimate was 2bn which implies c40bn of earnings taxed at additional rate) . The policy to abolish was idiotic but that doesn't mean things and now sunshine and lollipops.

The only option really right now is big spending cuts and they are going to be painful - there is very little fat to trim.

Or the Govt could tax the tax havens! The UK is said to be responsible for over a third of global tax losses ( a third of $400bn). Of course we will have to wait for a change of Government for this to happen.

 

[yorksrob]

I was under the impression that the DfT controlled what happened to stock? Do you mean the leasing companies rather than the TOCs? The Government could buy it for scrap value, do it up and use it, of course. The Welsh Government have done just that with Mk4 coaches.

It's really not, except for peak-time commuting into the largest cities. Other modes, or just not travelling at all, are the alternatives. That's why the strikes have had little impact to the vast majority of people. The only person I know who's noticed is a friend who wants to visit her mother but can't drive due to a medical condition. I'm going to see if she'll let me take her in the car.

Yes, sorry - leasing companies. Good to see the Welsh Government taking the approach.

Try doing any intermediate distance journey by public bus and see how long it takes you. Same to a lesser extent with coaches etc.

 

[Dai Corner]

Yes, sorry - leasing companies. Good to see the Welsh Government taking the approach.

Try doing any intermediate distance journey by public bus and see how long it takes you. Same to a lesser extent with coaches etc.

Try doing it by car and see how much quicker it is.

I find it hard to justify subsidising the railways to save people without access to a car but in a hurry some time I'm afraid.

 

[yorksrob]

Try doing it by car and see how much quicker it is.

I find it hard to justify subsidising the railways to save people without access to a car but in a hurry some time I'm afraid.

In your opinion.

Motor transport requires a massive take of land and resources. Are you seriously suggesting that everyone should get a car and be done with it ?

How about the elderly with poor vision and other people unfit ? If you had to drive around and park somewhere in competition with everyone else who needs to travel, you'd soon be able to justify subsidising the railway.

 

[Peter Sarf]

Yes, sorry - leasing companies. Good to see the Welsh Government taking the approach.

Try doing any intermediate distance journey by public bus and see how long it takes you. Same to a lesser extent with coaches etc.

Well I have just booked a return for two to Cardiff from London for £31 incl fees. That is by National Express coach and I never even considered looking at the rail option. I would love to go by rail and for most of my life I have been pro rail.

Incidentally Megabus was about £28 iirc but via Heathrow. The new kid on the block is Flixbus and was looking to be about £22 iirc again via Heathrow. I think NEX have sent Megabus to compete with Flixbus ?.

Before Covid I could get on Megabus for £8 + fees if I was planning far enough ahead. Yep 2 x £1 and 2 x £3 iirc. But that was rock bottom rare. Since Covid the competition has blurred somewhat. Last time we travelled (July iirc) the NEX coach was half full and very roughly I am paying double.

So is the message that rail needs to put up its fares a large amount or at least drop the cheaper fares ?. If the railways are so indispensable then it follows that those left travelling will reluctantly pay the extra. I hope that is not the case but it follows that some very real efforts need to be made to make rail survive and rely less on money from those not using it.

As someone who is pro rail I am at a loss, I cannot afford to use rail outside of London unless a bargain shows up.

 

[yorksrob]

Well I have just booked a return for two to Cardiff from London for £31 incl fees. That is by National Express coach and I never even considered looking at the rail option. Incidentally Megabus was about £28 iirc but via Heathrow. The new kid on the block is Flixbus and was looking to be about £22 iirc again via Heathrow. I think NEX have sent Megabus to compete with Flixbus ?.

Before Covid I could get on Megabus for £8 + fees if I was planning far enough ahead. Yep 2 x £1 and 2 x £3 iirc. But that was rock bottom rare. Since Covid the competition has blurred somewhat. Last time we travelled (July iirc) the NEX coach was half full and very roughly I am paying double.

So is the message that rail needs to put up its fares a large amount or at least drop the cheaper fares ?. If the railways are so indispensable then it follows that those left travelling will reluctantly pay the extra. I hope that is not the case but it follows that some very real efforts need to be made to make rail survive and rely less on those not using it.

It needs to put its fares down.

And you'd need a hell of a lot of mega-buses and national expresses to carry the people who currently go by rail.

Coach and long distance bus are niche products that don't compete on volume with intermediate and long distance rail.

 

[Dai Corner]

In your opinion.

Motor transport requires a massive take of land and resources. Are you seriously suggesting that everyone should get a car and be done with it ?

How about the elderly with poor vision and other people unfit ? If you had to drive around and park somewhere in competition with everyone else who needs to travel, you'd soon be able to justify subsidising the railway.

Roads are here to stay and carry freight, private cars, buses, coaches, taxis, tradespeople's vans. They're pretty much universal. The argument is whether we need a second transport infrastructure in and between more than a few of the large cities and for the relatively small number of heavy freight movements.

 

[matt_world2004]

Demand on the western branches of the Elizabeth line is 200% pre COVID. I wonder how much of that is to do with the introduction of gatelines

 

[yorksrob]

Roads are here to stay and carry freight, private cars, buses, coaches, taxis, tradespeople's vans. They're pretty much universal. The argument is whether we need a second transport infrastructure in more than a few of the large cities and for the relatively small number of heavy freight movements.

Roads are here to stay and the birds go tweat. Tell us something we don't know.

If you think that you could turf all of the people currently using the train into motor transport in towns and cities, and still pootle around in your little charabang without noticing, then you're in a dreamworld.

 

[Dai Corner]

Roads are here to stay and the birds go tweat. Tell us something we don't know.

If you think that you could turf all of the people currently using the train into motor transport in towns and cities, and still pootle around in your little charabang without noticing, then you're in a dreamworld.

I suggested a second transport infrastructure would be needed in large cities.

 

[yorksrob]

I suggested a second transport infrastructure would be needed in large cities.

Not just large cities, but also towns across the country. And what about between the towns and cities ?

 

[Dai Corner]

Not just large cities, but also towns across the country. And what about between the towns and cities ?

Bus, coach or park & ride, except where passenger volumes are sufficient to support intercity style services without subsidy.

I'm playing devil's advocate here, but these are probably the sort of discussions going on in Government.

 

[BrianW]

Bus, coach or park & ride, except where passenger volumes are sufficient to support intercity style services without subsidy.

I'm playing devil's advocate here, but these are probably the sort of discussions going on in Government.

More devil's advocacy. 'The market will decideA lot of folk might 'benefit' from seeing such things as railways and subsidies through the eyes of the current government.- undesirable as that might be. If there were no railways, would they be in government plans? Subsidies buck the market. If something is worth having, folk will pay for it. Why are these people travelling, whether from here to there at this or that time,or at all. The railways, sorry to say, have no divine right to exist. 'The market will decide' is a powerful driver, and what a lot of folk have voted for.

Why should the non-rail user be required to pay for me to travel?
Might not 'no travel' be greener and cheaper than roads, rails, runways etc?
Too much traffic; too much pollution? EVs. ULEZs. Congestion charging,Barriers, clamps, fines- all ways of 'encouraging' modal shift short of 'subidies' (almost as unpopular a word as 'benefits' or taxes). .

Reality checks coming ...

 

[Peter Sarf]

It needs to put its fares down.

And you'd need a hell of a lot of mega-buses and national expresses to carry the people who currently go by rail.

Coach and long distance bus are niche products that don't compete on volume with intermediate and long distance rail.

Putting the fares down relies on someone taking a risk. But in the cases where the trains were full and there was still a subsidy then it is mathematically impossible to increase volume and reduce revenue without even greater subsidy.

Might be a lot of coaches but is that really a bar ?.

I think coach very much does compete with rail. Maybe only on journeys over 60 minutes. I will suggest any inter urban journey.

Roads are here to stay and carry freight, private cars, buses, coaches, taxis, tradespeople's vans. They're pretty much universal. The argument is whether we need a second transport infrastructure in and between more than a few of the large cities and for the relatively small number of heavy freight movements.

That is the way I fear things could be heading. Towards a set of routes that would leave the results of Beeching looking like the fortunate result some would argue it was. Road has not got any less competitive since Dr Beeching looked at the railways.

Thinking of routes like Ashford to Hastings. Surely a more frequent bus service would be attractive. Then something of a longer distance for a coach service - maybe Settle to Carlisle or Salisbury to Exeter. In these cases I imagine the roads are not too good but that then tells us how many people probably travel those routes regardless of mode.

 

[Bletchleyite]

Thinking of routes like Ashford to Hastings. Surely a more frequent bus service would be attractive. Then something of a longer distance for a coach service - maybe Settle to Carlisle or Salisbury to Exeter. In these cases I imagine the roads are not too good but that then tells us how many people probably travel those routes regardless of mode.

The S&C is an example of a railway that if it wasn't there wouldn't have bus or coach services along that line of route. You'd have stuff like Kirkby Stephen to Penrith, Skipton to Settle and the likes, and quite possibly nothing at all to Horton (people would do the Three Peaks from Ingleton instead, which has buses to Lancaster). And of course Ribblehead would just be another valley with a road through it, about as attractive to tourists as the Snake Pass - the tourist attraction there is the railway.

It was built as a mainline, the fact that it is now basically a tourist attraction didn't even enter the heads of those building it. And if it'd stayed a mainline, it'd have maybe two or three stations if that, just as all the little local stations on the 2-track WCML were closed because they got in the way of the big fast trains.

 

[Peter Sarf]

Bus, coach or park & ride, except where passenger volumes are sufficient to support intercity style services without subsidy.

I'm playing devil's advocate here, but these are probably the sort of discussions going on in Government.

I very much fear those are the discussions going on. What do you spend money on health or loss making rail routes ?.

I am comfortable with the railways getting some subsidy in return for providing a strategic and ecological benefit to the country. But it is getting rather too much.

More devil's advocacy. 'The market will decideA lot of folk might 'benefit' from seeing such things as railways and subsidies through the eyes of the current government.- undesirable as that might be. If there were no railways, would they be in government plans? Subsidies buck the market. If something is worth having, folk will pay for it. Why are these people travelling, whether from here to there at this or that time,or at all. The railways, sorry to say, have no divine right to exist. 'The market will decide' is a powerful driver, and what a lot of folk have voted for.

Why should the non-rail user be required to pay for me to travel?
Might not 'no travel' be greener and cheaper than roads, rails, runways etc?
Too much traffic; too much pollution? EVs. ULEZs. Congestion charging,Barriers, clamps, fines- all ways of 'encouraging' modal shift short of 'subidies' (almost as unpopular a word as 'benefits' or taxes). .

Reality checks coming ...

Worse still the arguments you dare to mention have been around since before Working From Home was discovered !. So now even bread and butter commuting is something the railways cannot rely on.

 

[Bletchleyite]

I very much fear those are the discussions going on. What do you spend money on health or loss making rail routes ?.

Tories like trains. They're predominantly used by middle class people. I therefore can't see the Tories cutting the railways substantially.

Tories don't like buses. They're predominantly not used by middle class people, and then there was that quote from Thatcher. Lots of bus services have been cut despite buses being much cheaper than trains.

And most of the basket cases are in Wales and Scotland, where they're paid for not by Westminster but by their local - left wing - Governments.

 

[Peter Sarf]

The S&C is an example of a railway that if it wasn't there wouldn't have bus or coach services along that line of route. You'd have stuff like Kirkby Stephen to Penrith, Skipton to Settle and the likes, and quite possibly nothing at all to Horton (people would do the Three Peaks from Ingleton instead, which has buses to Lancaster). And of course Ribblehead would just be another valley with a road through it, about as attractive to tourists as the Snake Pass - the tourist attraction there is the railway.

It was built as a mainline, the fact that it is now basically a tourist attraction didn't even enter the heads of those building it. And if it'd stayed a mainline, it'd have maybe two or three stations if that, just as all the little local stations on the 2-track WCML were closed because they got in the way of the big fast trains.

True, if there was a good travel market along the S&C then there would be better roads for the busses/coaches.

Incidentally, Whilst reading your reply, I found myself thinking of the Edinburgh to Carlisle line. Is that what could have nearly happened to the S&C ?.

NOW

What needs to happen is for the advocates of rail to consider :-
What routes are currently profitable.
Then what routes could return to profit if changes were made but not changes unattractive to passengers (eg loss of frequency).
What changes could be made to routes to make them less dependent on subsidy and hope carryings increase in the next (say) five years.
Huge grey are of routes perhaps then lastly
Which routes always were a financial burden to the state and have got worse.

Bit of conjecture but I feel commuting has been the biggest change to the answers for the above since Covid.

And I remind myself I set up a thread to get away from the reporting of carryings for this Autumn (2022) - so as not to go off topic from the subject of this thread .

Here it is

Are the UK railways heading towards a period of Austerity ?.

I have been wondering for a while if the railways are about to see a trimming of the subsidy received. Or even harsher. Because of that I am tempted to jump at recent events that could indicate that. One being the statement that the Caledonian Sleeper contract is to cease from June next year...

www.railforums.co.uk

This thread does provide fodder (reality) for my thread.

 

[geoffk]

In your opinion.

Motor transport requires a massive take of land and resources. Are you seriously suggesting that everyone should get a car and be done with it ?

How about the elderly with poor vision and other people unfit ? If you had to drive around and park somewhere in competition with everyone else who needs to travel, you'd soon be able to justify subsidising the railway.

Are there any passenger railways in the world which don't require subsidy, other than perhaps metros? I guess that's not an easy question to answer because of things like tracks shared with freight and how the costs are apportioned, treatment of pension liabilities etc.

 

[6Gman]

Tories like trains. They're predominantly used by middle class people. I therefore can't see the Tories cutting the railways substantially.

Tories don't like buses. They're predominantly used by middle class people, and then there was that quote from Thatcher. Lots of bus services have been cut despite buses being much cheaper than trains.

And most of the basket cases are in Wales and Scotland, where they're paid for not by Westminster but by their local - left wing - Governments.

Which quote would that be?

The one people keep citing ("Anyone using a bus over the age of x ... " ?) and which nobody has found a record of her ever saying?

And which was circulating long before her time?

 

[43066]

It's probably not the traditional ROSCOs that are the biggest issue with increasing leasing costs: any DfT negotiated train contract is going to be a big part of the problem. IET was massively over-priced both on an absolute basis (i.e. it was procured in the most expensive way possible) and on value-for-money (i.e. the quality of what the passenger got).

I’m sure poor procurement practices and general public sector style incompetence at all levels have contributed. However ROSCOs have undoubtedly benefited from the “unique” way the industry has been set up. Rolling stock leasing has been extremely profitable since privatisation, with ROSCOs consistently enjoying far higher margins than (say) TOCs. These profits are subsidised by the tax payer and have been earned in a stable, predictable market which carries essentially zero commercial risk.

Those are the exactly the same arguments regularly deployed against railstaff pay, therefore you can see why I find it odd that this area of cost is ignored, while unions representing railway staff (including low to moderately paid ones) are continually attacked.

Staff-wise, you'd suspect there are roles that were nice-to-haves during the good times, but need to be looked at again now. Given the shortages, self-evidently train crew aren't in that category.

Yes, there certainly needs to be an acceptance that the railway does not exist in a bubble and isn’t immune from change, with inevitable ticket office closures being an obvious example. I agree the RMT in particular would be better off acknowledging this rather than just flatly opposing any changes whatsoever.

Unfortunately the current government’s attitude thus far has only entrenched positions even further. Let’s hope for a more pragmatic approach from the new transport minister which improves the situation for everyone concerned.

Or the Govt could tax the tax havens! The UK is said to be responsible for over a third of global tax losses ( a third of $400bn). Of course we will have to wait for a change of Government for this to happen.

It really, really isn’t as simple as that. Tax havens are foreign countries over which the U.K. government has no jurisdiction, they can’t “tax the tax havens” any more than they can “tax France”. It’s also perfectly legal for large multinationals to structure their affairs to minimise their overall tax liability, indeed their directors are under a fiduciary obligation to shareholders to do so. So I’m afraid the the suggestion above is both legally and economically illiterate.

What exactly do you mean by “global tax losses”? If tax isn’t legally required to be paid it isn’t “lost”, it was simply never owed in the first place.

Tories like trains. They're predominantly used by middle class people. I therefore can't see the Tories cutting the railways substantially.

Tories don't like buses. They're predominantly used by middle class people, and then there was that quote from Thatcher. Lots of bus services have been cut despite buses being much cheaper than trains.

It’s ironic that the only place I ever see doom-laden predictions of railway closures is on a discussion forum for railway enthusiasts .

 

[43096]

I’m sure poor procurement practices and general public sector style incompetence at all levels has contributed. However ROSCOs have undoubtedly benefited from the “unique” way the industry has been set up. Rolling stock leasing has been extremely profitable since privatisation, with ROSCOs consistently enjoying far higher margins than (say) TOCs. These profits are subsidised by the tax payer and have been earned in a stable, predictable market which carries essentially zero commercial risk.

Ironically, they do not now have zero commercial risk: only got to look at the 350/2s and 379s to see that.

In many ways, this is part of what the ROSCOs were set up to do: take on the risk of trains not being needed or replaced. I'd be willing to bet that a sizeable number of those now throwing up their hands in horror at modern trains not being used are some of the same people who used to complain about the ROSCOs not having any risks.

 

[geoffk]

It really, really isn’t as simple as that. Tax havens are foreign countries over which the U.K. government has no jurisdiction, they can’t “tax the tax havens” any more than they can “tax France”. It’s also perfectly legal for large multinationals to structure their affairs to minimise their overall tax liability, indeed their directors are under a fiduciary obligation to shareholders to do so. So I’m afraid the the suggestion above is both legally and economically illiterate.

What exactly do you mean by “global tax losses”? If tax isn’t legally required to be paid it isn’t “lost”, it was simply never owed in the first place.

It’s ironic that the only place I ever see doom-laden predictions of railway closures is on a discussion forum for railway enthusiasts .

Inequality and poverty: the hidden costs of tax dodging | Oxfam International

www.oxfam.org

This is a link to an Oxfam report, but there are others, highlighting the amount of wealth which flows untaxed and in secret, out of reach from tax authorities and regulators. The Uk alone can't tackle it. Wasn't one of the main reasons for Brexit the desire by certain individuals to escape scrutiny of their tax affairs by the EU? We are getting off the subject a bit.

 

[43066]

Inequality and poverty: the hidden costs of tax dodging | Oxfam International

www.oxfam.org

This is a link to an Oxfam report, but there are others, highlighting the amount of wealth which flows untaxed and in secret, out of reach from tax authorities and regulators.

Nothing in that report alters the reality of my statement above. Unfortunately simplistic bleating about rich people and inequality from Oxfam (who aren’t known for their tax expertise) doesn’t change the reality that you can’t just “tax tax havens”.

Funds being “out of reach of tax authorities” doesn’t necessarily mean anything untoward has happened. Do you have an ISA? If so you’re just another evil avoider of tax as far as Oxfam are concerned. Something to consider .