Fares, rail policy and DfT news

08.05.18

Rail industry to seek national ideas for ‘root and branch’ fares reform in June

The rail industry will move ahead with “root and branch” reform of rail fare regulation by launching a public consultation on 4 June spanning the whole country in order to establish a roadmap for change, it has been announced.

In a statement, the Rail Delivery Group (RDG) argued that decades of obsolete regulation have led to a ticketing and fare system outpaced by technology and how people work and travel.

Alongside watchdog Transport Focus, the RDG will look at proposals to make fares easier for customers to navigate, which will then be “designed to be neutral in overall revenue terms” and will require partnership working with governments in order to be implemented.

The consultation will close on 10 September.

This comes amid new research from KPMG which said that only a third of rail customers felt very confident they had bought the best value ticket for their last journey. And in December last year, DfT data showed that a year on from its ticketing action plan, most machines were still not offering the cheapest options to passengers.

Today’s RDG report also highlights the importance of securing an easier-to-use range of fares in order to deliver the industry’s long-term reform plans and to maximise benefits to customers, businesses and the economy.

The report argued that, although well-intentioned, regulation dating back to the mid-90s has been counterproductive and that extra layers of requirement have been added via individual franchise agreements since then. There are now 55 million different fares and, as a result, it has become increasingly difficult for rail companies to guarantee the best fare.

To help shape the consultation, the RDG has commissioned KPMG to formulate an independent report by late autumn to identify key principles which are driven by what customers need from the rail industry.

The organisation said these principles should include transparency, predictability, fairness, trust, ease-of-use and value for money; integration with other modes of transport; personalised, flexible fares; enabling of growth, innovation, efficiency and choice; and providing funding for investment to avoid the need for taxpayer subsidy.

A final report based on the consultation will set out new proposals to the government with options for fares reform.

Paul Plummer, chief executive of the RDG, said: “Unpicking the regulation of a £10bn-a-year fares system that underpins such a vital public service means there are no quick-and-easy solutions. The change that’s needed won’t be easy and the industry doesn’t have all the answers, which is why we want to hear views from passengers, communities and businesses in all parts of the country.

There have already been improvements and more are on the way but this consultation will enable us to create a clear roadmap with the country so that we can make the right changes for the long-term more quickly.”

Alex Hayman, Which? managing director of public markets, wrote about the industry’s major trust issue in the latest edition of RTM, where he argued that smart ticketing could be a solution to fare deals and customer compensation payments.

Responding to today’s news, he said: “Rail passengers have struggled for far too long with a confusing ticketing system that can make it hard to pay the right fare, so passenger-focused reform of the fare system is long overdue.

“The rail industry and government must ensure that any reforms tackle the poor levels of passenger satisfaction with the current ticketing system and are implemented swiftly.”

Chief executive of Transport Focus, Anthony Smith, added that the consultation would seek to make fares and ticketing systems more suitable to the way people travel now, especially by taking into account the “huge demand for smart ticketing.”

“Transport Focus, building on our unique insight and advocacy in this area, will ensure the passenger voice is heard. Any future regulation must support sensible, proportionate reform which can underpin change while preserving essential consumer protection,” he concluded.

 

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