Latest Rail News

25.08.15

TOCs fork out double the cash for passenger compensation costs

The amount of cash paid in delay and repay compensations to passengers by most major train operating companies has more than doubled over the last five years, according to new government figures.

The compensation claims cover both delayed journeys and discretionary reimbursements after complaints for poor services – like a dirty train or broken information screens – under the terms of each TOC’s ‘passenger charter’.

Martin Abrams, public transport campaigner at Campaign for Better Transport, said: “It’s deeply worrying that there has been such a steep rise in compensation payments over the last few years, and whilst steps have been taken to make claiming for a delay easier, punctuality figures show an increase in delays and cancellations over the same period which has led to this spike.

“What passengers want is a reliable train service and value for money, not constant delays and exorbitant fees. This week the rail minister Claire Perry talked about automated compensation payments, but that will only work with smart Oyster-style ticketing technology and the government and rail industry are still years away from a country-wide roll out.”

The state-owned East Coast franchise, replaced by Virgin Trains East Coast is franchisee from March, forked out more than £6m in 2014-15 – almost seven times more than the £883,000 compensation figure in 2010-11.

That was still a reduction on 2013-14, when it paid out almost £8m.

Under the new franchise, which is 90% owned by Stagecoach and 10% by Virgin Group, it paid out £450,000 in claims during its brief period in charge at the end of 2014-15. Proper comparison will only be possible at the end of 2015-16.

Virgin Trains West Coast spent over £10m in compensation costs during the same timeframe – a considerable increase from the £6.7m the previous year.

Other TOCs followed similar patterns: Abellio Greater Anglia paid 60% more during 2014-15 at a sum total of £2.3m, compared to just £120,000 in 2011-12.

Southern spent around £1.6m in 2014-15 compared to £522,000 four years ago. This is in line with its performance in this year’s period 4, during which it remained at the bottom of the chart with a PPM of 82.5% - down from 89.1% in the same period last year.

Meanwhile, despite paying out more than double during the last financial year than just three years ago, Southeastern slashed its compensation costs in half compared to 2013-14.

c2c stood out with just £23,000 paid in compensation costs during 2014-15, significantly less than any other TOC – though the figures are not normalised by passenger journeys or mileage. Virgin West Coast does about five times as train mileage per year as c2c.

c2c recorded very successful performance during this year’s period 4, having again recorded the highest PPM of all other franchises at 97.5%.

Many train firms across the country operate delay repay schemes through which dissatisfied commuters can apply for compensation if they face delays upwards of 30 minutes.

However c2c is pioneering a new scheme that plans to automatically refund passengers if trains are delayed by as much as two minutes, avoiding the national rail vouchers necessary to claim costs.

Under the pilot scheme, cash would be put directly into their accounts or travel cards. It will be rolled out on the c2c franchise between London Fenchurch Street and southern Essex starting next year.

(Top image c. Johnny Green, PA Images)

Comments

Joel   25/08/2015 at 13:36

please bear in mind that when East Coast was public, unlike the private operators, they encouraged delayed passengers to fill in repayment / compensation forms and even handed them out on the train, supplying the train's running number. So of course they paid out a lot more in comparison. let's see how good the 'new' operator is on East Coast - we'll need the delay hours total for the last year of East Coast and the full first year of Stagecoach-Virgin - are we likely to see that - oh look, porcine aviation.

Neil Palmer   25/08/2015 at 16:51

Joel, That's probably not a fair comment as it says Virgin Trains West Coast spent over £10m in compensation costs during the same timeframe that East Coast paid out £6m.

Saor Alba   25/08/2015 at 20:12

What was the figure for ScotRail, as that would give an almost entire Region?

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