Fares, rail policy and DfT news

03.01.17

Commuters protest for being ‘fleeced’ by steep rail fare hikes

Protests are taking place at rail stations around the country today (3 January) as the latest hike in rail fares comes into effect.

Three campaign groups – Action for Rail, We Own It and Bring Back British Rail – are leading major protests at London King’s Cross and Manchester Piccadilly, with other demonstrations taking place at over 100 stations, to call for a return to a nationalised railway.

Regulated fares such as season tickets will rise by 1.9%, and the overall increase is 2.3% on average. Campaign for Better Transport (CBT) calculated that popular commutes now cost as much as 27p per minute.

Lianna Etkind, CBT’s public transport campaigner, said: “Wages remain stagnant and trains continue to be hopelessly overcrowded, so commuters are rightly angry at annual fare rises when they see little or no improvement in the service they receive.

“Many commuters are now being charged at a similar level to a premium rate phone number for their season tickets and are left feeling equally as fleeced.”

The journey from Stevenage to London is the most expensive commute in England, costing 27p a minute, followed by Ashford International/Reading to London, Bath Spa to Bristol and Milton Keynes to London.

Etkind called for the government to introduce “a fairer ticketing system” that didn’t “penalise people for choosing to take the train”.

Separately, research by Action for Rail showed that rail fares have increased by 56% since 2006, over twice the increase in average wages and inflation.

This means that travellers from Luton to London now spend 14% of their earnings on a monthly season ticket, while travellers from Liverpool to Manchester spend 11%. Similar commutes in France cost 2% of monthly earnings, whereas in Germany and Italy they cost 3%.

Frances O’Grady, general secretary of the TUC, said: “Years of failed privatisation have left us with sky-high ticket prices, overcrowded trains, understaffed services and out-of-date infrastructure.”

Rail unions Aslef, RMT and TSSA backed the protests. Mick Whelan, general secretary of Aslef, said: “We have the most expensive railway in Europe and the train companies, aided and abetted by this government, are about to make it even more costly for people to travel.”

Aslef and RMT will lead a drivers’ strike on Southern Rail from 9 to 14 January as part of an ongoing industrial dispute over plans to remove the power of guards to operate train doors.

Mick Cash, general secretary of RMT, accused Southern and other rail companies of “laughing all the way to the bank”.

Andy McDonald, the shadow transport secretary, said that season ticket costs have increased by over £2,000 since the 2010 coalition government.

“Passengers were always told that higher fares were necessary to fund investment, but vital projects have been delayed by years and essential maintenance works have been put on hold,” he added. The latest major rail project to be delayed is electrification of the Great Western Main Line, which Bristol MP Karin Smyth said would have “devastating effects”.

Paul Plummer, chief executive of the Rail Delivery Group, which represents train operators and Network Rail, said: “Nobody wants to pay more to travel to work and at the moment in some places people aren’t getting the service they are paying for.”

However, he argued that the government was responsible for setting the increases to season tickets. But Chris Grayling, the transport secretary, insisted that regulated fares were growing faster than wages and the cap on regulated fares would save annual season ticket holders an average of £425 by 2020.

(Image: TSSA general secretary Manuel Cortes, Labour MP Emily Thornberry and shadow transport secretary Andy McDonald at King’s Cross Station this morning. Credit: John Stillwell from PA Wire and PA Images.)

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Comments

Jimbo   03/01/2017 at 19:16

I find it ironic that one protest group calls itself "Bring back British Rail" - BR were notorious for implementing above inflation price rises to stem demand on busy routes. With trains getting busier and busier, BR would have implemented far higher price rises as they didn't have nearly the level of investment that today's railway see. Talk about rose tinted spectacles !!

Small Business Owner   04/01/2017 at 09:54

As a director of a small business, I have an issue with price increases. In my particular field, in specialist electronics, there are a few competitors so the consumer has choice. If I put up my prices, the consumer has alternatives. In the rail industry, there is not really competition on routes because TOC's run 'one line' areas and have a virtual monopoly. If several TOC's were able to run the routes and call at most of the stations, then the passenger has choice. At the present time their choice is to lump it, get disenchanted, or travel by other means which usually means road. This is another subject though. It was mentioned on the news this week that shareholders receive huge dividends. It is now about time these privileges were cut out whilst the disputes are causing such enormous misery to rail travellers especially around the south-east.

John Grant   04/01/2017 at 18:04

"shareholders receive huge dividends" -- I think most of the profits come from the bus operations, though

Jimbo   04/01/2017 at 21:12

@SBO - There are plenty of alternatives to trains - cars, buses, bicycles, coaches, trams, other railways and even planes for some trips. Not all of these would apply to all people, but this is where the competition is, not on rail. You could even not make the trip, or move to reduce the cost. Even when there is competition between destinations (eg. London & Birmingham), this doesn't have much impact on prices increases as one service is already significantly cheaper than the other. It can be argued that the popularity of trains shows that the fares are too cheap compared to alternatives. Besides, prices between particular destinations are set by a single company, so multiple TOC's would charge the same for the same journey. As for huge dividends - this is a lie usually propagated by the unions. The return that the TOC's make range from zero to a couple of percent, which is low for this sort of business. The owning companies might be making bigger dividends, but that is from other businesses, not rail. Nobody likes price increases, but the rail industry screws itself by making them all at the same time and letting people get away with only reporting on the extreme cases. My fare went up by 1.2%, so less than the average which is fine, but you don't see that reported.

John Grant   04/01/2017 at 23:00

Jimbo's right about fare increases. Petrol and diesel are up a lot more over the year. When I moved here in 1973 a day return to the nearest large town was 13p, the same price as a pint in a pub. At the turn of the century it was about £2.50, still the same as a pint. Now it's £2.60 off-peak, £3.30 anytime, somewhat less than a pint in most pubs.

Jerry Alderson   05/01/2017 at 16:37

Re: profits. "shareholders receive huge dividends" -- I think most of the profits come from the bus operations, though. Govia and GTR are lousy at communicating with the public to counter the downright lies spouted by some parties. Correct about Southern: GTR makes no money at all. Half of the profits that Govia (60% owner of GTR) came from its two other franchises (Southeastern and London Midland) and half from buses. Profits of 3% of turnover on franchises are quite generous given that the owning groups do not invest in the railway and are therefore not getting a return on investment, and also that they do not own many assets and are therefore not having to use profit to pay for renewals. The profit therefore largely covers their risks (and also their initial bidding and set-up costs, plus the bids it fails to win that are lost money). Of course, their risks are somewhat limited since they can always walk away from a loss-making franchise. On the bus side of the company, it is a true commercial business and so profits are needed to buy and renew the buses just to stand still never mind about row the business. Re: so-called privatised passenger railway. The key problems with the passenger service are that it is: a) geographically fragmented b) group of [private] monopolies c) short-term d) under the thumb of the government Ownership is not the issue at all, but fragmentation is an issue - not because it is fragmented but the way in which it is. BR had a 100% monopoly. Most TOCs have a 90% monopoly: there tends to be competition between major cities but those using a smaller station often have only one operator. BR was less under the thumb of government than the TOCs. I was very short-term in that its budget was set annually, but thought long-term when considering capital projects.

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