What Would a Good System for Working out Fares Look Like?

Discussion in 'Fares Advice & Policy' started by DynamicSpirit, 3 Jan 2017.

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  1. Bletchleyite

    Bletchleyite Veteran Member

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    It would be an awful lot easier to do that using "more flexible Advances". Train-specific, but fully changeable for no fee, just the fare difference.

    Indeed, the XC approach of "late Advances" is heading that way. Then you'd just have an Anytime and these tickets. Logically, regulated fares would instead be a regulated fare *basket* instead - based on the average fare per head on the route, say.
     
    Last edited: 5 Jan 2017
  2. DynamicSpirit

    DynamicSpirit Established Member

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    Maybe that's because 'proper' answers to your questions would take considerable time and resources to provide.

    It seems clear to me that any system, even one that's primarily based on mileage, would have to have lots of cases where individual fares are reviewed and adjusted manually to make sure they don't cause undue overcrowding, or anomalies where there are alternative routes. I don't think it's reasonable to expect people here to go through that analysis to come up with specific fares - which as I understand it is basically what your questions are asking.

    We're individuals discussing, in principle, what a decent fares system might look like and on what principles it might be based. We're not train companies equipped with all the staff and detailed information (for example on line mileages) to work out the details of individual cases.

    I'm not sure that's entirely fair to put it like that. Those suggestions have been made by various different people who have different opinions, and I don't think any one single person here has said they support all of those ideas.

    What you've described above may well be complicated to the TOC to work out the possible fares in the first place, but that's not an issue. The issue is how complex is it to the passenger to work out which ticket is the best/cheapest one for him to buy. In that regard, I'm not convinced what is being proposed is more complex than what exists at present - where you don't even know at the ticket machine whether you might be able to get a better deal by split ticketing. (Although I would say that I think having very fine-grained choices of which route your ticket is valid on is too complex, I personally probably wouldn't support that).

    Besides, I don't think it's just complexity. The question of fairness is also important. No system of fares is going to be perfect - because of the need to balance competing requirements (demand management, ease of enforcement, complexity, etc.). But one thing that seems to have been completely lost from the current system is fairness. The example that sparked this thread was that on some Virgin trains from London, the walk-on fare actually gets lower if you stay on the train for longer. That may well have good rationale in terms of yield management etc., but it runs completely against the human instinct of fairness. It makes the people who are paying more to travel the shorter distance feel (arguably, justifiably) ripped off, and leads to all sorts of attempts to work around the system, and can only damage confidence in the railways. Split-ticketing is another example: The fact that it is possible runs against basic notions of fairness - in some ways that's a more significant problem than the fact that split-ticketing can be so complex to do.

    That's all important. And it's something that a system based (roughly) on mileage, would be likely to fix (although obviously, care would be needed in working out the details).
     
    Last edited: 5 Jan 2017
  3. cuccir

    cuccir Established Member

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    Yeah, I agree that Yorkie's questions are disingenuous: we don't have access to profit margins, loading figures, investment plans etc. Giving specific figures would be nonsensical.

    That said - it strikes me DynamicSpirit that by the time you've added your caveats, supplements for different train types etc, what you are describing is essentially a variation on our current system rather than anything particularly new! Furthermore the assertion - that something which is more instinctive is therefore fairer - is just an assertion. Is it fairer for people travelling to/from Preston to be more overcrowded trains in order to keep pricing in line with a cost that would keep journeys to Lancaster (or that matter Carlisle and Glasgow) attractive? I'm not sure it necessarily is.

    I do think we need to look at pricing. It frustrates me that (for example), living in Durham I can't really justify a spontaneous day's train travel to York (£37.80 return), yet that when I used to live in Newcastle, I could do a similar day-trip to Carlisle (£16.20 return), simply because of the different roles of the ECML and Tyne Valley line in our national rail network. It doesn't feel right, as you point out.

    Fundamentally, I think that issues in the fare structure is probably a symptom of lack of what Neil Williams described nicely above as our 'web' of a network, along with issues in capacity rather than a problem which can be resolved in itself. If we created greater capacity - lines, trains and stations - then prices would fall to more usable levels across the board.
    --
    Smartcards would solve some but not all of the problems. Most obviously, smartcards would allow for easier introduction of flexible season tickets or carnet-style travel, and for cheaper local journeys along mainlines or within regions because they can track how you subsequently travel: by ending split ticketing, they could allow for cheaper local journeys. However, they wouldn't fix the 'cheaper to travel to Lancaster than to Preston' problem, and I think that can only be achieved through greater capacity.
     
    Last edited: 5 Jan 2017
  4. DynamicSpirit

    DynamicSpirit Established Member

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    It think there is some truth in that - the system I would have might well end up not too different from the current system in some ways. However, a key difference is that I would make sure that fares are (to some approximation) comparable for comparable distances, that they don't go down as distance goes up, and that the cheapest ticket for a journey is almost always a through ticket, not a hard-to-find split one.

    One other thing I would do - which hasn't been discussed so far on this thread - and which I think is more revolutionary is: I'd drop the price of all single tickets to be something like 55% of the price of a return. I think the current system where a single for most journeys costs basically the same as a return is ludicrous, is massively unfair to people who only need to travel one way, and is a needless disincentive to travel by train for people whose journeys are anything other than simple out-and-back trips.

    I would suspect that the numbers of people who don't want to make simple return journeys is relatively small (and some of those are actually making circular trips of the form A-B-C-A rather than one-way trips), so dropping the prices of singles in this way wouldn't significantly reduce revenue, but it would make pricing a lot fairer, and it would make using the railways much more attractive to people who need to make more complex journeys.
     
    Last edited: 5 Jan 2017
  5. daodao

    daodao Member

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    I agree with the above. Well put.
     
  6. telstarbox

    telstarbox Established Member

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    Yorkie's questions are relevant because they highlight that the railway doesn't operate in isolation but as part of the wider transport market, so a pure mileage system is too much of a blunt instrument.

    In a broad sense, trains 'compete' against taxis, buses, light rail and cycling for short journeys, and car travel, coaches and domestic flights for longer journeys.

    This competition isn't just in financial terms but also in terms of time and comfort - for example business travellers can get more work done on a 2 hour train journey than a 2 hour car journey, even if the 'price label' of the train journey is more expensive. Commuter cyclists have often moved over from crowded public transport journeys.
     
  7. Haywain

    Haywain Established Member

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    I don't agree. If you advocate a mileage based fares system, then what yorkie is asking for is examples. So, let's say £1 per (one way) mile for return tickets shall we? That makes St Albans to St Pancras £20, Kings Cross to Durham £254, Euston to Glasgow £401 and Penzance to Aberdeen £720 (or thereabouts). Do these seem reasonable? Do they all look reasonable if the amount per mile is reduced? It seems that everybody wants to say what would be fairer, but nobody is prepared to actually give any sort of figures. That is without taking into account the effect on the overall train company revenue or on capacity or loadings - that is what yorkie is asking for.
     
  8. asylumxl

    asylumxl Established Member

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    I'm not really as well versed in the fare system as most people in this thread, but I wanted to add my 2 pence to the discussion.

    Regarding mileage based fares, they cannot be simple multiplication of the mile rate. A discount needs to be applied that rises proportionally with the mileage and be weighted accordingly. Perhaps the largest discount could be calculated from the current fare for the longest journey.

    To be honest though, I think the best solution is to take advantage of the large analytical powers we have in computing these days, or "big data" if you wish. From analysis of various factors it'd be possible to build a complex mathematical model for fares and what factors effect them. Calculated fares can then be compared to the current fares and outliers adjusted to be in line with other dates.
     
  9. Bletchleyite

    Bletchleyite Veteran Member

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    I'd drop them to 50%. It's worked for the low cost airlines. It would remove one heck of a lot of complexity on things like routeing and excesses, particularly as you could replace excesses with effectively trading in the ticket you have against the one you want.
     
  10. Haywain

    Haywain Established Member

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    It hasn't worked for low cost airlines because they have never had return fares to halve. They use a fully dynamic pricing model, the like of which could perhaps work on long distance trains (a development of the Advance ticket model) but not on local services. However, the principal reason it works for low cost airlines is that they operate purely point-to-point so remove options to stop or start short or split tickets or have any concern about what it might cost to go one stop more or less.
     
    Last edited: 5 Jan 2017
  11. BigCj34

    BigCj34 Member

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    It sounds like demand based fare zoning and abolishing returns that are the same price as singles are ideas here.

    Is it so much to have split tickets aggregated into an advance ticket for the sake of convenience? Granted, the passenger won't be able to make any of the breaks where the ticket allows but many split ticket users probably don't anyway. There are many advance fares that cover multiple operators anyway, so any split journey that has an advance fare in could be an advance fare all the way. Personally if I was travelling from Birmingham to Glasgow and there was a peak portion between Birmingham and Wolverhampton and an advance segment between Wolverhampton and Stafford, I'm most likely going to be using the times train split gave me rather than worry about being able to break my journey at Wolverhampton.

    Split ticket journeys that are cheaper from covering peak and off peak segments could be packaged into one ticket, though the complication however is whether it should be a cheaper peak ticket that allows breaks but mandates that the passenger cannot get an earlier train, or is simply an advance ticket, is another matter though.
     
  12. cuccir

    cuccir Established Member

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    But that's unknowable. How much profit did each TOC make last year? What are their investment plans for the next decade? Which TOCs are planning to rebid for future franchises? What are the loadings of peak, off-peak trains? How does ORCATS allocate fares among TOCs?

    This an enthusiasts forum. We can only talk in general terms about the principles that might shape the fares system. The idea that we can actually propose new systems, informed by figures, is laughable.

    The underlying point - that crude mileage-based systems are flawed - is a good one. The questions help reveal that, yes. But the follow-up which bemoans that we 'still don't have any figures' is nonsense.
     
    Last edited: 5 Jan 2017
  13. Bletchleyite

    Bletchleyite Veteran Member

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    Now that could well lead to a usable idea. For Advance tickets, a given journey is already split into a set of "legs" (I forget the correct term), each of which has a quota associated to it. The overall fare is built up of these quotas *at the highest one that is available* (thus causing anomalies). Also there are some journeys for which Advance fares are not available.

    So, how could we make this more practical?

    We could do the following:-

    - Each TOC divides all their services up into chunks, as presently is AIUI done for Advances. Each chunk has a set of quotas and a fare. For a given chunk, there may or may not be Advance fares, or just Anytime/Off Peak walk-ups, or whatever. A TOC wishing to discount a set of chunks could also set a fare for multiple chunks provided it was not in excess of the fare for the chunks it makes up (thus avoiding anomalies).

    - When a passenger requests a specific journey, via whatever route they so desire, doublebacks etc included, with breaks of journey timed in if they wish, the fare is summed from the current quota of each relevant bit and issued as an Advance ticket valid on the selected services only. Where a given chunk has no Advance fare, the cheapest valid walk-up fare is used.

    - Changes would be free of charge, but would require payment up to the fare of the selected changed service(s). A "rescue fee" of maybe the £10 admin fee could apply to the situation where a train was missed and the passenger wishes to reinstate the ticket and change it to a later service, provided they do so on the booked day of travel (say), or perhaps within, say, 12 hours of the time of departure of each booked train.

    If this was combined with true e-ticketing, so you could easily do changes online, on mobile etc, as well as at ticket offices and TVMs, this could work pretty well.

    That would leave the question of how to work walk-ups, assuming we consider those to remain needed. They could work roughly as they do now, but as singles, for "expert users" to use as they wish. But the advantage of the above would be that provided the passenger used an Advance, there would be no anomalies at all - they would *always* get the cheapest ticket for their journey - and with the change fee removed and a relatively small "missed the train" fee it would also remove many of the disadvantages of Advances entirely.
     
    Last edited: 5 Jan 2017
  14. Haywain

    Haywain Established Member

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    Simpler? Fairer? Sounds like making it more complicated to me.
     
  15. Bletchleyite

    Bletchleyite Veteran Member

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    How? The passenger would be shielded from any complication, and would simply book their ticket online, at a TVM or a ticket office for a specified set of services, safe in the knowledge that they got the best value. And if they need to, can change it within reasonable parameters.

    Complexity *in the background* is fine provided it doesn't reflect on the passenger (i.e. a need to split tickets to save money).
     
  16. najaB

    najaB Veteran Member

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    The thing that comes to mind with that system is that people could end up with very different fares for the same journey - even more so than today - and there would be no easy way to verify that they did actually get the best fare available.
     
  17. TrainfanBen

    TrainfanBen Member

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    Not really, I think it could just be a case of staff asking the customer a couple of questions. 9/10 somebody who purchases the full price anytime ticket isn't trying to pull a fast one.

    In reference to me suggesting in essence "It should be shut down" I wish to clarify, by 'shut down' I was just speaking generally that eventually the franchise might be offered to a new operator if things became untenable.

    I apologise, I thought the sarcasm was clear enough. I wasn't insinuating that there should be no trains on the routes GTR operate, just perhaps that it was time for somebody else to takeover.



    FURTHER EDIT:
    Furthermore, by "Incentivise people to use quieter services" yes, TOC's already do this, which is why there is a £11.50 advance single fare for Birmingham-Preston.

    However, the point I'm really getting at is that there should be MORE done. Demand and supply really isn't accurately reflected in the ticket prices, and refunding full ticket price holders when they use the quieter services sends a clear message and would actually boost customer satisfaction.

    Anyway, Virgin would jump at the idea, they'd love an idea like mine ;)
     
    Last edited: 5 Jan 2017
  18. Bletchleyite

    Bletchleyite Veteran Member

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    Though it's worth noting that it's not dissimilar to how Advance fares work now - sort of.
     
  19. bb21

    bb21 Moderator Staff Member Moderator

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    The problem now is that GTR is of course a poisoned chalice. Who's going to be willing to take over if Govia are booted out, especially when the company is losing money hand over fist?

    The DfT have the choice to order GTR to provide an improved offering, seeing that it is a management contract. The core issue is whether the department cared enough about the poor sods who need to travel with them to do that.
     
  20. Deerfold

    Deerfold Established Member

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    GTR are unlikely to be replaced any time soon. They're doing exactly what the DfT wants - breaking the unions at pretty much any cost.
     
  21. najaB

    najaB Veteran Member

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    Indeed, but at least it's fairly straightforward to look up what basket a given fare came out of.
     
  22. Haywain

    Haywain Established Member

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    I disagree. The principles of such a system are determined by the variations in price, as I have demonstrated with a strictly mileage based system. The level that prices are pitched at is determined by the unknown factors but the theoretical price used for modelling such a system will easily demonstrate whether it is fair. My earlier example does this at 10p or £1 per mile; one is too cheap for a short distance, the other is too expensive for a long distance.

    Without giving examples figures it can never be determined that a fares structure could work at all, therefore they are essential to the discussion.
    Complexity is not fine if you try to achieve a system that is seen to be simpler to understand or fairer to customers in knowing what the cost of a journey might be.
     
  23. Bletchleyite

    Bletchleyite Veteran Member

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    It is, but at the expense of it often being cheaper to split tickets. And the "normal" traveller doesn't care a proverbial fig about fare baskets or whatever, they just care about the fare that is quoted to them, and to some extent that it isn't more expensive than a longer journey or a sum of the shorter ones, which with this change (which I think has actually been proposed for Advances on a less overall scale) both of those boxes would be ticked.
    --- old post above --- --- new post below ---
    People seem quite happy to use the likes of easyJet and Ryanair without giving a stuff what the fare calculation basis actually is. What they care about is the price of the journey when they purchase it, and an element of "fairness".
     
  24. Haywain

    Haywain Established Member

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    That is not a valid comparison because people do not expect walk-up fares, they understand that booking earlier means cheaper, and know they do not have the option of splitting. With easyJet and Ryanair, and any number of other low-cost airlines, all you have is the price (that is available at your time of booking) from A to B.

    Oddly enough, while I see and hear people comparing train fares with flights to New York or wherever on a regular basis, I have only very rarely heard of anyone comparing an easyJet fare to one destination with a Ryanair fare to somewhere completely different. This suggest a very different expectation for the different modes of travel.
     
  25. Bletchleyite

    Bletchleyite Veteran Member

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    Hasn't the balance recently tipped so most people making long-distance rail journeys are now doing it using Advances, whereas previously it was walk-ups? And I'd venture the view that even more probably would if they were available for cheaper than the walk-up fare, which they often are not on busy trains.

    If I'm correct in that, the expectation, splitting aside, is exactly the same.
     
  26. sheff1

    sheff1 Established Member

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    Yes, but you did not take into account this:

    I am not aware of any current mileage based rail pricing which does not include both (i) a taper and (ii) a maximum fare once a given distance has been reached (which is not the longest single journey distance it is possible to travel on the network).
     
  27. Haywain

    Haywain Established Member

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    That's fine. Can you now show examples that would not create anomalies? Everybody seems to want to talk theory without using numbers to demonstrate how their ideas would work in a way that improves on the current system.
     
  28. Bletchleyite

    Bletchleyite Veteran Member

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    A kilometric system?

    No pure, tapered or capped kilometric system would create any anomalies provided the passenger always paid based on actual rail kilometres. This would have the disadvantage of making tickets fully route-specific[1], and things like making travel via the Northampton loop more expensive than straight down the mainline - but those are not anomalies, rather just flaws, and they could be worked around by increasing the number of tariff kilometres on the mainline route to make diversions like that equal in fare.

    It's when you complicate it beyond that that there are anomalies - but there are ways to complicate it without really creating any that are used in some parts of Europe, e.g. increasing the number of tariff kilometres on a faster route. The key to it not having anomalies is that (a) you pay for the route you use, and (b) any journey on that section of line has the same number of tariff kilometres.

    Edit: You could even have different numbers of tariff kilometres by TOC if desired. For example, LM services on the Trent Valley might have a lower number than VT ones. Again that would create no anomaly as such, because *every* journey involving those trains[2] would be priced the same way, so splitting would never be of benefit.

    [1] This would not necessarily be a problem provided single-fare pricing was used. If you want a different route, just trade in your ticket, even if partially used, against the required one. A TVM could easily do this. And there'd be none of this Routeing Guide or "thou shalt go this way" nonsense - any route you liked, including Bletchley to MKC via London, Edinburgh, Aberdeen, Inverness, Glasgow, Manchester and Northampton or some such silliness, could easily be priced without a problem.

    [2] If it's all calculated, there's no reason you shouldn't price a journey as, say, LM Only MKC-Crewe then Any Permitted Crewe-Manchester, or whatever, and chuck it all out on one ticket. DB have the capability to price in that way.
     
    Last edited: 6 Jan 2017
  29. Deerfold

    Deerfold Established Member

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    So any stretch of line the same length would be priced the same?

    Just been looking at a couple of stretches of line that are a similar length.

    Keighley to Leeds
    Bushey to London Euston


    The first is £8.30 anytime day return

    The second is £17.00 anytime day return

    Would you expect your kilometric pricing system to produce prices closer to the first or the second?

    Or somewhere in between?

    Do you expect this to cause a mass exodus from trains in Yorkshire or increase usage massively in Hertfordshire and London?
     
  30. Bletchleyite

    Bletchleyite Veteran Member

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    On a pure kilometric system, yes. If you use "tariff kilometres" and vary the number of "kilometres" on any given section of line, as DB and SBB do in places, no. The key to avoiding anomalies is this simple idea - if you have:

    A -5- B -6- C

    ...then a ticket A-C has 11 tariff kilometres, one from A-B has 5, and one from B-C has 6 - you don't ever create an A-C fare that's cheaper than one of the short sections alone, nor A-B + B-C < A-C.

    The answer, if you go pure kilometric, is "whatever makes it revenue neutral". A lot of people keep asking us to come up with figures, and we can't, because usage figures would be required to do that and those are not available to the public. But as I noted above you don't have to go pure kilometric. The absolute key, though, is that pricing is based on sections of physical line, not commercially based on journeys.
     
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