Examination of Witnesses (Questions 220-239)
MR DAVID
MAPP, MR
PAUL SMITH,
MR TONY
COLLINS, MR
GRAHAM LEECH
AND MR
CHRISTOPHER GARNETT
30 NOVEMBER 2005
Q220 Mr Scott: So you are saying
that in Germany the price of commuting into Berlin would be totally
different from the price, much, much lower than the price, of
commuting into London?
Mr Mapp: I think clearly the level
of subsidy has some effect on season ticket prices and I do not
know what the level of subsidy is in Germany compared to this
country, but clearly if there was a higher subsidy paid, which
I suspect there may well be, that would have some impact on prices.
Q221 Chairman: Mr Mapp, you have
just said something which I find very interesting. You have said
that this problem is a historic one. In other words, you took
over to revolutionise the rail industry, to change the situation,
but you have rigidly stuck with this one aspect of British Rail.
Is that right?
Mr Mapp: Well, we were regulated
as far as pricing was concerned.
Q222 Chairman: But you are not now
and the change has been quite considerable. It seems very clear
that I can travel wherever I like in Germany on one ticket for
less than it takes for me to go from Milton Keynes to London.
Mr Garnett: The Government controls
season ticket fares and they have done since privatisation. When
you bid for a railway, you bid on the basis of controlled and
uncontrolled fares, so when the Government changed the regulations
to say that it was no longer RPI-1, but RPI+1, the extra money,
when season ticket fares went up, never came to us, but went straight
back to the Government, so we do not see that change in the season
ticket fares. That goes straight to the Government. The Government
control the price of season ticket fares and it was one of the
things they introduced at rail privatisation because, quite rightly,
that is the one area where we are a monopoly supplier and we could
be accused of gouging the market. That is why the Government have
that protection for commuters on it, but it is the Government
who set the season ticket price. The season ticket price has not
varied from BR days in terms of the controls of it. Yes, all other
fares around it have moved, but the Government lay down the fares
on season tickets and it is not just season tickets in isolation
as it ties into London, but tube fares and so on, and it is part
of a much more complicated discussion about what is the subsidy
that we, as a country, want to give to commuting. If you go and
make commuting even cheaper, you will fill up the trains even
more and the demand on the public purse then to provide the extra
infrastructure to get people into London becomes even greater.
I think that the whole cost of commuting, and that is why it is
controlled by the Government, drives a massive investment cost
to the Government if they were to start changing it.
Q223 Mr Scott: So, in simple terms,
the Government is to blame for it all?
Mr Garnett: Not to blame. That
is the reality of how it has always been in this country and that
is how we, as a country, Parliament or whatever, decided they
wanted to invest the money in railways and that is the price of
season tickets that we have lived with for a very long time as
a country, always more expensive than Europe.
Mr Mapp: What we sought to do
in our evidence was simply to point out some of the background
factors that made crude comparisons between different European
countries difficult to interpret.
Q224 Chairman: Perhaps you could
tell us how you got the figures for the price per kilometre in
other European countries?
Mr Mapp: We took the best published
data which I think in this case came from ATOC's international
equivalent, the UIC, and we took revenue totals and passenger
kilometre totals for each of the railways and then derived the
per kilometre figure based on those numbers.
Q225 Mr Scott: You said earlier that
you did not know the level of subsidies that were given to the
train operators in Germany. Would it be possible perhaps for that
information to be made available?
Mr Mapp: Well, we did think about
doing some research into this area in preparation for the Committee
and indeed we have had some discussions with a couple of academics
who have done work in this area. It is actually very difficult
because subsidies are paid in quite different ways in different
European countries. Many European railway companies do not just
run trains, for instance, but they also run buses and ferries
and so on as well. We would welcome some research which had a
look at the comparative levels of subsidy for the different countries.
Q226 Mr Goodwill: Mr Garnett, I too
had a look at your website and, as a regular user of your website,
I found it fairly easy to navigate. I noticed, for example, that
if I wanted to travel from York to King's Cross on your 15.10
service on 19 December, there are in fact 12 different fares ranging
from £9.50 to £121.50 and in fact your Saver Single
at £68.30 is more expensive than your Standard Advance one.
Now, I appreciate that there are an increasing number of people
in this country who have got access to the Internet and can purchase
tickets in this way, but how do you think you can make these tickets
more accessible to groups like pensioners who may not be able
to purchase tickets in this sophisticated way?
Mr Garnett: 90% of our passengers
have access to the website, and that is research we have recently
done—
Q227 Chairman: 90%?
Mr Garnett: 90% of our passengers
have access to the website. I was absolutely amazed by that statistic.
Q228 Chairman: Well, I will join
you in that, Mr Garnett!
Mr Garnett: I am very glad! The
question is: what about people who have not? There is still the
telephone and they can still ring the call centres and get the
information. We are selling at the same price over the telephone
as we do on the website or they can go to the station and get
the information there, so it is still available for everybody
to get it and of course pensioners will get them at half the price
because they will get the OAP discount.
Q229 Mr Goodwill: The National Rail
Enquiries helpline is an excellent service and I was surprised
at how good it was it was when I used it, and it is owned by the
train-operating companies. Why is it that one cannot purchase
a ticket using the helpline as well as get information on a service?
Mr Mapp: Well, the National Rail
Enquiries service, it is one of the obligations upon train companies
to provide that information service. At the moment the regulation
that governs its provision stipulates that it should be an information
provision service and, therefore, we comply with that obligation.
Having said that, we have diversified enormously and there are
a number of ways in which you can obtain information, not just
through the web, but also mobile telephones and of course we also
now provide real-time web information for train services as well,
so I think we have stretched the envelope as far as that service
is concerned.
Q230 Chairman: But did you ask for
any change because I remember you coming before us, not you personally,
Mr Mapp, but, as an organisation, I can remember you coming and
giving evidence to this Committee about the way that the train
enquiry system is working, and nor was there any suggestion that
you wanted to sell tickets via the same information service?
Mr Mapp: I think it is something
that clearly we would be prepared to consider, but, as I say,
at the moment—
Q231 Chairman: Well, this was some
time ago and it seems to me that if you were going to consider
it, you could have done it in the interim.
Mr Mapp: I am sorry?
Q232 Chairman: This was some time
ago that you were discussing it and you are still considering
it. You do like a long period of consideration at the Association
of Train Operating Companies.
Mr Mapp: Well, as I say, the primary
obligation that we have is to provide the information on train
services.
Q233 Chairman: Have you ever asked
the Government to alter that primary obligation?
Mr Mapp: I am not aware that we
have, but I will ask my colleagues to comment.
Mr Garnett: I think when we debated
this as the train companies when I was Chairman of ATOC, the view
was that there were already at that stage two very good websites,
one by National Express and one by Trainline and now it is all
operated by Trainline. That website is then operated by a number
of companies and also there are telephone sales over the phone.
Therefore, there was not a case for ATOC to do it as well.
Chairman: Yes, so there is not a case
for ATOC doing it.
Q234 Mr Goodwill: I just wonder whether
it would simplify the process of buying a ticket if one call could
both get the information and buy the ticket and whether it would
be something you would be wishing to apply to do.
Mr Mapp: What it does of course
is that it does have a call-forwarding facility, so if you call
NRES and you say that you would like information about a particular
journey you are planning to make, the information is provided
and NRES then can transfer you to one of the retailers that Mr
Garnett has described.
Q235 Mr Clelland: On the subject
of call centres, do your call centres prioritise callers on the
basis of the average credit rating in the area they are calling
from?
Mr Collins: Absolutely not, absolutely
not.
Mr Leech: It is entirely first
come, first served. Whoever is next in the queue is answered.
The only reason that any information like postcodes is kept is
for credit card billing and for delivery of tickets. It also means
that if somebody is calling back again, because they often make
the same sort of journey, that information is readily available
and it means the call is quicker and the service is better for
everybody concerned, but there is absolutely no preference whatsoever
according to where people live or their credit rating.
Mr Garnett: The only issue we
have, knowing where your constituency is and the call centre we
have in the middle of Newcastle, is that there are some postcodes
where we do not send tickets because we get a very high rate of
theft of tickets or credit card fraud and that has been on the
advice of police not to deal with certain areas because of that.
Q236 Chairman: Are your customers
aware of that?
Mr Garnett: I would doubt it.
Those who are trying to fiddle the system undoubtedly are aware
of it because we then—
Q237 Chairman: So they come on the
line and they ask for all this information, say they want to buy
a ticket and you say, "No, sorry, you are living in the wrong
place"?
Mr Garnett: No, we say, "We're
sorry, we're not despatching tickets to that place because there
has been such a level missing", and this is on the advice
of police.
Chairman: That must go down well!
Q238 Mr Clelland: So you do have
the technology, and presumably Virgin do as well, to discriminate
in that way if you chose to?
Mr Garnett: We do not know the
postcode of the incoming call. It is only when you have gone through
it and you ask for the postcode that then we have to go into retreat.
Q239 Mr Clelland: Is there any other
way that you discriminate against customers ringing call centres?
Mr Leech: No, we do not. It is
a straightforward service where we want to provide calls and answer
them as quickly as we can and there is no discrimination; it is
first come, first served.
Mr Mapp: I think these questions
follow on from Mr Crow's remarks to the Committee last week. Following
that, I have checked with all the major telesales retailers of
rail and none of them uses the technology that Mr Crow was referring
to. I have checked and it does exist technically, you can buy
software of the kind he describes, but we do not use it.
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