Transport Secretary speech tomorrow: "Fares reform" and "Best price guarantee"

[redreni]

Contactless PAYG system planned - i

Expanding contactless train travel will be a priority of the UK’s new publicly-owned rail company, Great British Railways.

Transport Secretary Heidi Alexander will make fare and ticketing reform one of her key four priorities for GBR, including the expansion of pay as you go. This will initially be concentrated on commuter services in the south-east of England, with 11 stations already announced, but a Government source said Alexander will also announce plans to extend the rollout of contactless travel elsewhere in the UK by the end of the year.

Alexander, who is seen as less evangelical about rail nationalisation than her predecessor Louise Haigh, will use a speech on Monday to set out her plans, while warning nationalisation is not a “silver bullet” for better performance....

...Alexander is expected to reveal plans to “hardwire a focus on passengers” into GBR, according to the Department for Transport, with more integrated services, performance data including on punctuality displayed at stations and reformed fares and ticketing...

I read this in today's paper and found it vaguely worrying. All very well for ministers to chase a headline, but this sounds a bit like a minister meddling in something of which neither they nor their special advisors have the slightest understanding.

In particular, I would like to see the wrinkles worked out the existing PAYG schemes before they are expanded further at pace (specifically, fix the issue with Railcards not being accepted and get to the bottom of why TfL Oyster and Contactless journey histories weren't available for months on end before towards the end of last year, and confirm measures are in place to prevent anything similar ever happening again).

It's unclear what else (apart from rolling out more PAYG) is meant by "fares reform"? Why, officially, does the Secretary of State think fares need to be reformed? Is the aim said to be to simplify fares?Presumably not, seeing as expanding PAYG adds an additional layer of complexity in the areas in which PAYG is rolled out. Obviously, one suspects the government's real aim in this area - increase yield and enable Rachel Reeves to continue to ignore decades-old capacity issues by pricing people off the busiest services - hasn't changed. It's not clear from the press coverage I've seen what the Secretary of State is saying the aim of fares reform is, though?

The phrase "Best price guarantee" did catch my attention, though. That sounds fun. Perhaps we'll get more details tomorrow?

 

[yorkie]

Contactless PAYG system planned - i

I read this in today's paper and found it vaguely worrying. All very well for ministers to chase a headline, but this sounds a bit like a minister meddling in something of which neither they nor their SpAds have the slightest understanding.

In particular, I would like to see the wrinkles worked out the existing PAYG schemes before they are expanded further at pace (specifically, fix the issue with Railcards not being accepted and get to the bottom of why TfL Oyster and Contactless journey histories weren't available for months on end before towards the end of last year, and confirm measures are in place to prevent anything similar ever happening again)....

There are all sorts of issues going on, however I don't think many people at the top, who make decisions, really understand what's going on.

...It's unclear what else (apart from rolling out more PAYG) is meant by "fares reform"?..

It's a buzzword that sounds good to people who think it means that higher priced fares will go down; sadly we know from LNER's reforms that it actually results in higher fares for many people (especially leisure passengers) and a loss of flexibility for customers.

Why, officially, does the Secretary of State think fares need to be reformed?

That's a good question, but I suspect they say it because it's one of those things that has been talked about for years and therefore they think it is a good idea. However, what they don't realise is that there are very good reasons why it's been talked about for so long, but not actually happened: because there is no way to actually achieve it without either increasing subsidy, or making a lot of people very unhappy when their fares go up. Not unsurprisingly, neither option is deemed to be politically acceptable.

Is the aim said to be to simplify fares?

I think, if asked, they would say so. However we all know that means eliminating some of the better value products. Those who benefit tend to be businesses with big budgets. Ordinary people lose out.

Presumably not, seeing as expanding PAYG adds an additional layer of complexity in the areas in which PAYG is rolled out.

I think they would see this as temporary, or perhaps that people have a choice of simplicity or choosing not to be "simple".

But PAYG is only simple from the point of view of not selecting a product and simply being billed whatever the rail industry thinks you should be billed; it's not necessarily simple when it comes to working out what price will be charged (so not good for people on a tight budget), and certainly not simple for anyone who wants the cheapest combination.

Indeed, for those who want the cheapest combination of fares, without PAYG it is simple: buy from a split ticket provider. But with PAYG that goes out the window: you have to manually figure out that tapping out and back in at somewhere like Willesden Jn, Hatton Cross, Ealing Broadway, East Croydon etc is going to be cheaper, and then waste your time going out of the gates and back in again.

PAYG is only truly simple for people with big wallets who don't care what they are charged and don't want to do any research or budgeting.

Obviously one suspects the government's real aim in this area - increase yield and enable Rachel Reeves to continue to ignore decades-old capacity issues by pricing people off the busiest services - hasn't changed

As there is no suggestion that anyone at the Government is unhappy with what LNER are doing, this is absolutely the only logical conclusion we can make.

. It's not clear from the press coverage I've seen what the Secretary of State is saying the aim of fares reform is, though?

I doubt they even know themselves.

The phrase "Best price guarantee" did catch my attention, though. That sounds fun.

That'll be interesting; if they truly wanted to guarantee the "best price", they wouldn't have set up a pricing structure that deliberately charges people more for not tapping out and back in at various places. There is no way they are going to reduce fares such as Gatwick or Heathrow to London, and no way they are going to automatically split those journeys.

There will be the sort of small print that LNER like to say, which makes the "guarantee" worthless, and far from any form of guarantee whatsoever.

Perhaps we'll get more details tomorrow?

They won't have thought much, if anything, through by tomorrow.

If they really wanted a fair and simple system, they'd engage with forum members. But I can't see that happening. If anyone at the Government or DfT is reading this, I'd love to be proved wrong; email us at intouch@railforums.co.uk !

 

[styles]

I won't quote yorkie's full reply, but I do think a lot of it hinges on whether the contactless system is capable of actually working out the cheapest fare.

We know that split tickets, ranger/rover tickets, etc can be cheaper. If the system is developed to factor in these options, then it sounds great to me. Many transport networks operate contactless schemes which account for things like fare caps and zone differences. I suspect though that the reality will not be so great. I have little confidence in the current government achieving anything 'radical' and rolling out a contactless payment system for trains which accounts for split tickets seems ridiculously unlikely.

Simplify it may, but achieve cost-effectiveness for travellers, I highly doubt.

 

[yorkie]

I won't quote yorkie's full reply, but I do think a lot of it hinges on whether the contactless system is capable of actually working out the cheapest fare.

The contactless system deliberately charges more than the cheapest combination of fares, as there is money to be made in doing so.

I've even tried telling passengers about the Hatton Cross trick, but people generally prefer to pay the extra to stay on the train.

For e-tickets, people are often (though not always) happy to use split ticketing sites to save money; after all, you still get one PDF, one itinerary, and it's all done for you, but with Contactless it's very different, as you have to go to a barrier line to tap out and back in again; there is no way they are going to automate that, and charge everyone the lower fares that only a very small number of people can be bothered to instigate by going out of our way.

We know that split tickets, ranger/rover tickets, etc can be cheaper. If the system is developed to factor in these options, then it sounds great to me.

There is no way they are going to throw that revenue away by proactively offering splits, when they have deliberately priced the longer journeys at a premium.

It's one thing having third parties undercut the price the transport operators want to charge people (the Government tolerates this because they have no viable alternative), but quite another having a system that automatically takes away the premium that the companies are deliberately charging to those who don't want to go to the faff of tapping out and back in again!

If anything, PAYG makes it even easier to charge premiums, as passengers are billed retrospectively.

My prediction is that there will be even more PAYG anomalies created, with no attempts made to abolish the anomalies that have been deliberately created so far; any promise to charge lower fares will be quietly dropped.

Many transport networks operate contactless schemes which account for things like fare caps and zone differences. I suspect though that the reality will not be so great. I have little confidence in the current government achieving anything 'radical' and rolling out a contactless payment system for trains which accounts for split tickets seems ridiculously unlikely.

Simplify it may, but achieve cost-effectiveness for travellers, I highly doubt.

Indeed, it won't achieve that. That's the only guarantee about any of this!

 

[SynthD]

In particular, I would like to see the wrinkles worked out the existing PAYG schemes before they are expanded further at pace (specifically, fix the issue with Railcards not being accepted and get to the bottom of why TfL Oyster and Contactless journey histories weren't available for months on end before towards the end of last year, and confirm measures are in place to prevent anything similar ever happening again).

Project Oval does already have the aim to accept railcards. I expect that the rest of Oval is the first set of deliverables of this announcement.
TfL were hacked. This isn’t entirely preventable, they will have already done what they can to improve security but shouldn’t make promises. The payg system has to be centralised and I don’t expect a way around that.

 

[redreni]

Project Oval does already have the aim to accept railcards. I expect that the rest of Oval is the first set of deliverables of this announcement.
TfL were hacked. This isn’t entirely preventable, they will have already done what they can to improve security but shouldn’t make promises. The payg system has to be centralised and I don’t expect a way around that.

I realise mine is a minority view, but I genuinely think if the integrity of the personal data collected through PAYG can't be assured to a reasonable degree (i.e. if the operators of PAYG schemes are just going to say "we're the victim and there's not much we can do"), then PAYG schemes should not be allowed to operate. They're very convenient and nice to have, but we don't have to have them. It isn't strictly necessary to collect all that data and just accept that any reasonably bright teenager can hack into it. It's incumbent on anyone who wishes to handle the personal data of nearly all of London's commuters to safeguard it and it's nobody else's problem if that proves difficult. If it's too difficult to achieve, there's nothing to stop us going back to season tickets for commuters, and day tickets for people making lots of journeys, and single tickets for anyone just making one or two trips (perhaps including e-tickets for the latter two to get rid of the necessity to queue at stations).

The scope of the requirement for the next phase of Oval to support Railcard acceptance is a bit vague for my liking, judging by the tender documents that were made public. Arguably, support for any two or more Railcards would suffice to meet TfL's requirements. If it continues not to support Network Railcards then PAYG will remain largely useless to me on weekends, for example. If it doesn't support Two Together Railcards then the football crowd I associate with will continue to be well advised to buy tickets from Maidenhead to Zone 1 to join up with their Advance singles heading north, rather than use PAYG.

The rules around Railcard validity can be complex and support for all of them is not something that can easily be retrofitted onto any PAYG system that wasn't designed with them in mind. I don't accept that it isn't technically possible to handle group Railcard discounts (which seems to be TfL's position), because if TfL allowed a group to register as such on its website or app and each person to associate their payment card with the group then it could tell if the group travelled together and apply the discount. But I see no indication that anything like that is happening.

 

[SynthD]

I realise mine is a minority view, but I genuinely think if the integrity of the personal data collected through PAYG can't be assured to a reasonable degree (i.e. if the operators of PAYG schemes are just going to say "we're the victim and there's not much we can do"), then PAYG schemes should not be allowed to operate.

I don’t disagree. However, that isn’t what happened in the TfL hack. I believe the small number of people affected that way were given free use of a credit agency’s protection product. Should TfL have said that louder?

The rules around Railcard validity can be complex and support for all of them is not something that can easily be retrofitted onto any PAYG system that wasn't designed with them in mind.

That’s why it’s important that the Oyster backend is ended, and the cards are moved to the contactless backend. The updates on Oval I’ve seen have focused on adding stations, not this type of progress.

 

[dosxuk]

It's unclear what else (apart from rolling out more PAYG) is meant by "fares reform"?

Reform is a great word - it makes both the people who think fares are currently too expensive and the people who think more of the system should be paid for by it's users think they're going to be getting a deal, when in reality little will change and both groups will still be fed up.

 

[Bletchleyite]

Reform is a great word - it makes both the people who think fares are currently too expensive and the people who think more of the system should be paid for by it's users think they're going to be getting a deal, when in reality little will change and both groups will still be fed up.

Or the change will be strongly negative in nature, such as LNER's fare increase and flexibility reduction "trial".

 

[yorksrob]

I'm afraid that until the LNER "trial" is ditched, I'm highly suspicious.

 

[A S Leib]

When's the last time a fare change was introduced which was beneficial from a passenger's perspective, aside from things like PAYG without fare increases? The last one I can think of is TfW letting accompanied children ride off-peak for free on routes west of Cardiff – Chester inclusive (I think? I can't remember the exact details). Because using a family and friends railcard works out cheaper than benefitting from the free under-16 travel in most cases, I don't think that change would even be a massively expensive one.

Prices in multiples of adult fare	TfW fare	F&F
1 adult 1 child	1.00	0.87
1 adult 2 child	1.00	1.07
2 adult 1 child	2.00	1.54
2 adult 2 child	2.00	1.74

 

[redreni]

Perhaps regional PAYG schemes have been introduced without raising fares. In London, off-peak day return fares were withdrawn despite the fact they were the only way to get a Network Railcard discount (since the discount isn't available on PAYG). So that one could have been beneficial for everyone, but was implemented such that it was only beneficial for passengers making a single journey and resulted in either no change or increases for those making a return journey.

 

[Dr Day]

No operator will have effectively reduced fares hence lost revenue unless there was something in it for them (eg reduced selling costs) or it was a contractual obligation - maybe a ‘goodie’ thrown in to secure a franchise back in the day or more recently a policy instruction.

Has anything actually been announced ?

 

[redreni]

Has anything actually been announced ?

No, I started the thread in anticipation of the Transport Secretary making a speech today, as trailed in the papers yesterday. Perhaps she has a cold?

All I could find on the DfT pages on gov.uk was this article about Oval which says "New tap in tap out system will guarantee passengers get the best fare available at the time on the day."

I read it all the way to the end, waiting for the bit where they admit this isn't true because the point-to-point PAYG fares are frequently beaten by split tickets and/or Railcard-discounted tickets and/or GroupSave or family tickets, but it doesn't come. So perhaps that's the answer: the policy is simply to pretend PAYG guarantees you the best fare?

One has to wonder if it's even worth complaining about the many cases where that isn't so, given they'd be far more likely to respond by withdrawing the tickets that undercut PAYG than by reducing the PAYG fares or offering Railcard discounts or even refraining from making false claims when promoting PAYG.

 

[Mark J]

'Fares reform'

So that will be more LNER style pricing that will cost us more to travel.

I hardly call that 'fares reform', just another excuse to extract even more money from passengers.

 

[Bletchleyite]

It is of note that Modern Railways reported a few months back that the LNER fare increase trial has in fact been revenue neutral. That to me says it to be a failure, though Horne is so obsessed with being a ground-level airline that he is still considering it a success.

 

[43066]

It is of note that Modern Railways reported a few months back that the LNER fare increase trial has in fact been revenue neutral. That to me says it to be a failure, though Horne is so obsessed with being a ground-level airline that he is still considering it a success.

What has happened to passenger numbers over the period? (Not that Modern Railways can always be relied on to be accurate of course!)

 

[Bletchleyite]

What has happened to passenger numbers over the period? (Not that Modern Railways can always be relied on to be accurate of course!)

I don't know to be honest. Supposedly it has worked at reducing overcrowding (which I guess it would - making reservation actually compulsory by stealth by making travelling unreserved too expensive for most) but some of the losses may well be because people are booking further in advance and getting the lower fares as you might as well if you've lost the flexibility anyway.

 

[43066]

I don't know to be honest. Supposedly it has worked at reducing overcrowding (which I guess it would - making reservation actually compulsory by stealth by making travelling unreserved too expensive for most) but some of the losses may well be because people are booking further in advance and getting the lower fares as you might as well if you've lost the flexibility anyway.

It would be interesting to know. If it leads to an increase in passenger numbers and is revenue neutral I could see how it could be termed a success, especially if it evens out loadings.

If it’s revenue neutral, but also means fewer passengers carried, it arguably makes the railway less useful, and is therefore more difficult to support.

 

[yorksrob]

I don't know to be honest. Supposedly it has worked at reducing overcrowding (which I guess it would - making reservation actually compulsory by stealth by making travelling unreserved too expensive for most) but some of the losses may well be because people are booking further in advance and getting the lower fares as you might as well if you've lost the flexibility anyway.

It would be interesting to know. If it leads to an increase in passenger numbers and is revenue neutral I could see how it could be termed a success, especially if it evens out loadings.

If it’s revenue neutral, but also means fewer passengers carried, it arguably makes the railway less useful, and is therefore more difficult to support.

It would be interesting to know, particularly as we're told that most passengers on long IC journeys go advanced purchase.

I have my doubts.