Examination of Witnesses (Questions 80-99)
MR BRIAN
COOKE, MR
JOHN CARTLEDGE,
MR COLIN
FOXALL, MR
ANTHONY SMITH,
MR ALAN
MEREDITH AND
MR STEPHEN
ABBOTT
23 NOVEMBER 2005
Q80 Clive Efford: Are you surprised at
that state of affairs on Network South East, that not all stations
are gated? It is unthinkable on the Underground.
Mr Cooke: It is unthinkable on
the Underground. They do not have to be gated, they only have
to have readers that somebody can put their card on as they enter
or leave the station. Some stations do just have readers without
gates. In fact, TfL offered to finance some of this for the national
railways a year or two ago, the national railways rejected that
and we find that very sad.
Q81 Clive Efford: What were the reasons
they gave for rejecting that?
Mr Cooke: They believe they will
not get as much revenue at the end of the day, and that is clearly
what they believe. The evidence that we have is that the spread
of revenue could be very similar. There will be changes to it
but it could be very similar in totality.
Q82 Clive Efford: Why do tickets in London
and the south east remain valid for just one day unlike elsewhere?
Mr Cooke: The principal reason
for that is that they believe that limits fraud. We are not convinced
that is the case.
Mr Cartledge: The principle being
that many tickets in London were never checked and, therefore,
if you walked off with them at the end of your journey you could
reuse them as many times as the ticket was valid, if it had a
longer period of expiry than one day. In a fully gated system
where the ticket is collected when it ceases to be valid, that
should cease to be an issue. There is another problem with the
Oyster card which is that extending it to national rail, apart
from the cost of gating many national rail stations that have
low numbers of passengers, and therefore the cost recovery will
be less than is the case with Underground stations which are busier,
is the fact that Transport for London has a contract with a particular
supplier of software and the specifications are not compatible
with a new national standard that the Government is anxious to
introduce for all railway tickets. TfL went first before this
specification existed and there is a real issue, therefore, about
how you move from a previous generation of software to a new one,
otherwise the suppler of the existing software get a free gift
because nobody else has the intellectual property rights to extend
their equipment more widely on the national rail network.
Q83 Clive Efford: Is that going to lead
to an enormous delay in integrating the Oyster card? Is that an
insurmountable problem in the short-term?
Mr Cooke: It has led to a delay
already and the longer the situation continues, the longer the
delay will be. Whether it is surmountable or not depends on how
soon the Mayor and the Minister can come to some agreement as
to how to resolve it.
Chairman: Let us not get into that.
Q84 Mr Goodman: I was interested in the
point you made about monopolies because there are other modes
of transport in competition with rail. For example, I was surprised
to learn the other day that it is cheaper for two people to travel
together in a taxi from York Station to Heathrow Airport than
to get a first-class rail ticket, which surprised me. Going back
to your point, Mr Foxall, about the complexity of buying tickets—it
is slightly off the subject of fares—would it make it simpler
for people buying tickets if National Rail Enquiries could sell
tickets because at the moment, as I understand it, the train operators
are preventing National Rail Enquiries from selling tickets. You
have to make two calls, one to find out the information about
trains and the second call to actually purchase the tickets. Would
that simplify the system?
Mr Foxall: I guess in principle
anything that makes it easier for passengers to acquire tickets
is likely to. I do not know of any research that suggests that
it is likely.
Chairman: And we are not going to go
down that particular route today, no, not today. Mr Leech?
Q85 Mr Leech: I would just like to come
back on the point that was made by Mr Abbott earlier. You suggested
that it would be I think you used the word easy or easier to introduce
an airline-type system for ticketing along the West Coast Main
Line. Can you elaborate on why you believe it would be easier
on that as opposed to other routes?
Mr Abbott: I think that type of
ticketing is more appropriate to longish inter-city journeys because
it mimics the airline journey, point-to-point, city-to-city journey.
There is a danger that passengers are being forced into buying
advance fare tickets for relatively short journeys. We have had
an example in the East Midlands where cheap day return tickets
for journeys of 40 to 50 miles have been withdrawn and replaced
by advanced purchase tickets at a similar price. I believe the
intention of the train operator is to force people to buy full
fare tickets. Perhaps I could say a couple of words about regulation,
Madam Chairman.
Q86 Chairman: Very briefly, Mr Abbott.
Mr Abbott: When regulation of
fares commenced, my understanding is that it was the intention
that the full open return would be regulated, but because for
much of the country the most expensive ticket was the saver return
that was regulated instead, so that together with season tickets
and short distance day returns, the journeys used by people who
had to travel for work and other similar reasons, were regulated.
Since privatisation, however, the companies have dodged round
the issue by bringing in more and more restrictions to the point
where a saver ticket now in many cases is more restrictive than
the old super saver, which is largely abolished, so again passengers
are forced to buy more expensive open tickets.
Q87 Mr Clelland: Why is the creation
of a national railcard such a good idea?
Mr Smith: It would be a good idea
if it encouraged more people to travel. If it encouraged more
people to get out of their cars and to use the trains, it would
be a good idea. It has a simplicity about it which is attractive.
Q88 Mr Clelland: You said "if"
but presumably you think it would be because you are recommending
it?
Mr Smith: We have put forward
a policy position that we would like to see a railcard. To be
honest, we need to do more work on it in the context of the research
that has already been mentioned. It is clear that other types
of railcards do encourage travel, otherwise the rail companies
would not do it. It is odd that we do not have this type of national
railcard when we have a national rail network which still describes
itself as such.
Q89 Mr Clelland: What is the evidence
from Sweden on that? In the evidence from the East Midlands there
was mention of the Swedish system.
Mr Abbott: I think in some small
European countries such as Sweden you can buy a pass which covers
the whole country for a year. We have a similar sort of thing
in this country for Greater London and the Metropolitan areas.
I think that although a national railcard has an attraction, to
me there is a danger, first of all, that the railways would carry
more passengers for less money in aggregate, and it is a slippery
slope to go down. I think there is also a danger that the train
operators would tend to put up the price of unregulated tickets
in the knowledge that many of the purchasers were getting a discount.
I think there is evidence of this from the South East. From the
brief study I did I found the price of a cheap day return in the
southern counties is more expensive than we find in the East and
West Midlands because many of the purchasers have a network card
and are getting one-third off.
Q90 Mr Clelland: Should all the tickets
be regulated? Would it help if we had more regulation?
Mr Abbott: I do not think we would
want to see every type of ticket regulated but I do think the
regulation issue needs re-examination. I am afraid I do not have
any instant solutions to offer.
Mr Smith: On that particular point
about the regulation of open tickets, it is a knotty problem that
one. One of the first complaints I ever saw when I joined the
RPC was a woman who went to travel from Newcastle to London for
a funeral, who had not used the railway for years, who turned
up at the railway station, and was astounded at the price of an
open ticket.
Q91 Chairman: Are we not all?
Mr Smith: How a system deals with
people who have got that type of problem is the test of whether
that system works well or not because if you have that type of
price people cannot use the railways, and you are excluding them
from a public service. That is a very important public policy
decision that the Government and the train companies need to think
very hard about.
Q92 Chairman: In that case given the
low levels of satisfaction amongst passengers and the negative
press that railways often receive, do you think the market is
likely to respond with new products and structures when they look
at something like the fare structure in something like the Grand
Central Railway bid? This is a completely new structure. I have
to tell you I see no burgeoning shoots of imagination in the railway
companies but could you give me some hope?
Mr Smith: I think, Chairman, there
is evidence that any type of new initiative like that does spur
the other people in the railway industry to try and innovate.
There are some very interesting developments in ticketing at the
moment. We have now got South West Trains offering £1 tickets
from Southampton and Portsmouth to London if you are prepared
to travel at slightly odd times of the day. It is still a £1
ticket and passengers, I suspect, will like that. We have now
got Virgin who have changed the restrictions on some of their
tickets so that you can buy them the day before rather than two
weeks, seven days or three days before. Again I think passengers
will like that. Trying to bind that into a set of rules that meets
the whole country is very difficult. We look at it from the passengers'
perspective. As our Chairman said, what is going to give passengers
value for money? In a sense at the end of the day that is the
key test.
Q93 Chairman: So you quite like the idea
of using on-line systems?
Mr Foxall: I think the argument
for that in terms of longer journeys, although not necessarily
the very longest journeys, is probably right. Going back to the
previous discussion slightly, I would be a little nervous about
rigidity. We have already one very complex system here. If we
are going to try and regulate in a way which covers every possibility
of everything that might happen on the railways in terms of fares
policy, we are going to end up with an even more complicated system
with a great deal of rigidity. The important thing is likely to
be—and we have still to test it with passengers—that
the core should be regulated as it is now but it should be a simpler
and more understandable core.
Q94 Chairman: You do hint a little bit
at the fact that secrecy covers so many of these things and that
the companies are not transparent so the passenger has no way
of making a fair judgment. You particularly talk about quotas
available for each type of ticket. What are the reasons for that?
Mr Foxall: Just on the secrecy
issue, one of the things we found necessary to do was to produce
documents and brochures and so on with advice to passengers. That
is something we think we are going to have to go on doing. I do
not know whether there is a great conspiracy, frankly—
Q95 Chairman: Just a little conspiracy?
Mr Foxall: There might be some
but the natural conspiracy of someone who is trying to beat his
competitors or something or that sort, I do not know it is there.
Q96 Chairman: Do you think they regard
one another as competitors?
Mr Foxall: In a sense, because
they are in the same industry.
Q97 Chairman: Yes. Mr Cooke?
Mr Cooke: Just to make one comment
about the complexity. That is one-eighth of the national fares
of the railways and it is the book for London for national railways.
In contrast, that is the book of TfL fares in London. I think
that shows the complexity of the situation quite dramatically.
Q98 Chairman: Well, we do not have an
easy way of recording visual aids but doubtless Gurney's will
compose some fantastic response to that. Finally, you are fairly
critical of the rise in fares for walk-on open fares. Do you think
the principle that passengers should pay a premium for flexibility
is the right one?
Mr Foxall: I want to know what
they think. Madam Chairman, I am not trying to be difficult.
Q99 Chairman: We understand your position.
Mr Foxall: Really straightforwardly—
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