Fares Reform – it needs to be smart!

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Last summer, the Rail Delivery Group (RDG) – an association made up of the majority of the companies operating Britain’s railways – ran a consultation on the future of rail fares and off the back of this, a couple of weeks ago the RDG published an initial set of proposals for reform. These are based around one core concept – a move to single-leg ticketing, as seen in London. Single-leg ticketing basically means that you pay for the single journeys you make, rather than the current system where return tickets can be heavily discounted as opposed to single journeys – quite often a day return between any two stations is only 10p more than a single currently.

Smart ticketing – and why it’s so important

This is also tied in with a move towards ‘smart’ (smartcard/mobile-based) ticketing. It’s essential that this is implemented properly before the introduction of any major reform, and here’s why:

For single-leg ticketing to work most effectively, travellers need to be able to have flexibility, without being disadvantaged by queuing up for a separate ticket on every leg of their journey. The way I can see this working best is following a similar model as that used in the Netherlands, which already has single-leg ticketing fully in operation. They primarily use smartcards called OV-Chipkaarts for travel, which can be topped up either at ticket machines or online (manually or by setting up auto topup), and they offer a discount as opposed to buying standard single tickets (which come in disposable smartcard form – I’m not proposing the UK uses this as the cost/benefit of swapping our magnetic-based tickets for disposable single-use smartcards probably doesn’t stack up). There’s also the option to purchase tickets online and use them immediately – this is done in the form of a barcode which you scan at ticket gates and onboard, not dissimilarly to the limited setup we already have here for mobile ticketing (explained below), but on a national basis.

Sign at Haringey station in London reminding Oyster card users to touch in/out. Credit: Wikimedia Commons

The industry is already making progress on this, with the majority of TOCs offering smart/electronic ticketing of some description avoiding the need to print physical tickets and reducing queuing times. Some TOCs (such as the Thameslink division of GTR) currently only have this technology fully available for season tickets so there’s still some work to do here. There’s also another ‘Key’ issue (funnily enough, my local operator’s smartcard system is called The Key!) – at the moment the majority of smartcards outside of London’s Oyster card only work on the services of one particular TOC. In reality, a large number of people will use two or more operators for their journey, so a national Smartcard-based system being rolled out is essential, alongside multi-operator mobile tickets (which do already exist in some parts of the UK, but need to be rolled out nationally).

So, we know Smartcards are the key, but what about the other changes in this reform?

If the industry implements smart ticketing properly, with one unified smartcard system (or at the very least operators’ smartcards being inter-compatible with each other), I think these reforms stand a good chance of working. However, there are also some other key factors to consider:

RDG’s summary states that any changes made will be ‘revenue neutral’. This means there will be losers as well as winners from any change made, so it doesn’t mean that singles will suddenly become half the price of current return tickets. What I think is more likely is that return ticket prices will increase by about 10% (i.e. singles will cost, on average, around 10% more than half the current return price), to subsidise those making single journeys on non-Advance tickets (I anticipate Advance tickets – quota controlled cheaper tickets on long distance routes sold as singles will stay broadly as they are now, though with a push towards these being e-tickets/mobile tickets rather than collected at the station on the credit card sized magstripe tickets) and season tickets will stay broadly the same or have a slight increase.

How this looks in practice

Let’s have a look here at a worked example of how these new fares might look in practice. This is intended as a rough model, but should at least give you an idea of how a new system may look fares-wise. I’m going to use my most common journey of Bedford-London for this.

Ticket TypeCurrent PriceEstimated Price (Reformed)
Anytime Day Single£27.30£25
Super Off Peak Day Single (weekdays, not valid in morning peak - to be renamed Off Peak Day Single)£24.50£17
Anytime Day Return£43.60£42 (1x £25 + 1x £17)
Off Peak Day Return
(weekdays, not valid in morning peak)
£31.00£34 (2x £17)
(new!) Super Off Peak Day Single (not valid in morning or evening peak)N/A£11
Super Off Peak Day Return
(weekdays, not valid in morning or evening peak)
£24.60£22 (2x £11)

I’ve focused here on weekday fares (weekend fares on this particular line are cheaper but the same sort of principles would apply). Remember I said there’d be winners and losers? The obvious losers in this example would be those buying daily peak-time fares – they would see a small increase in price. However, this is offset by the off-peak price – you just need to avoid peak travel in one direction to make a saving on current pricing (though not enough to discourage regular daily commuters from buying a season – I’m assuming here season ticket pricing would remain broadly unchanged). The biggest winners here are those who are going away for a few days (perhaps travelling onwards to Heathrow) and previously would have been stung by the huge surcharge for non-Day return fares – in this model they’d make around a 40% saving.

Remember what I’ve done above is only a very rough model and those prices are almost certainly not final, they’re just intended as a crude example of how the new pricing might look.

To avoid negative PR with any reform, it is vital in my view that no immediate fare increases take place on the date of implementation of more than the current RPI+1% regulated fares increase by each year currently. (I’d anticipate this reform being introduced would need to replace the January fares increase on the year of introduction).

Finally, I just want to touch on split ticketing (using two or more separate tickets for the same journey), and how that’s managed after any reform is completed, is also a concern for some. In an ideal world, this wouldn’t be needed with the implementation of single, distance-based fares, however this is unrealistic in my view with the complexity of routing in the UK. As now, it may also be beneficial to combine an Advance with a walk-up ticket if an Advance quota is only available for part of the journey. (incidentally, if you’re looking for the cheapest options for tickets now, sites like trainsplit.com already calculate the cheapest splits available, well worth taking a look at!

I’d encourage you to have a read of the initial reform report summary linked in the first paragraph if you want more detail, and do let me know what you think of these proposed changes in the comments!

Cover image taken at London Transport Museum’s depot in Acton, London.

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