Examination of Witnesses (Quesitons 20-39)
MR CHRIS
AUSTIN, MR
DAVID MAPP
AND MR
RICHARD MALINS
14 NOVEMBER 2007
Q20 Mrs Ellman: Could I ask you a
little more about this survey. You say 99% satisfaction—that
sounds extraordinary.
Mr Mapp: It is very high.
Q21 Chairman: Where did you undertake
your survey, Mr Mapp? You are stretching the Committee's credulous
response.
Mr Mapp: I think what lies behind
it is the fact that the vast majority of ticket sales are actually
fairly straightforward repeat purchases. It is for the next station
down the line, it is a cheap day return or it is a saver return
to London and so on, and booking clerks become very expert in
issuing those tickets. Where we tend to make mistakes are with
products which are much less frequently issued where the booking
clerk in some cases will not be aware of some of the finer detail
associated with the product. It is those types of mistakes that
tend to get publicised quite widely in the media, but the evidence
suggests that for the vast majority of customers they are sold
the right ticket for their journey.
Q22 Mrs Ellman: I find it very hard
to believe this 99% figure. It just flies in the face of what
I know to be the case from numerous people who discuss this. There
have been numerous reports of people not getting the correct information
and having great difficulty in trying to access information. Are
you being complacent when you talk about 99%?
Mr Mapp: Are we complacent? No,
not in the least. As I said, we fully accept we make mistakes
and 1% of one billion passenger journeys is still a large number
of customers that get sold the wrong ticket; we fully accept that.
Q23 Chairman: We do not disagree,
1% is a lot of journeys; we sort of suspect it might be a bigger
percentage than one.
Mr Mapp: As I say, the mystery
shopping survey is conducted independently by a market research
company. We share the results with the Department for Transport.
Q24 Mr Leech: You use the phrase
the "most appropriate" ticket rather than "best
value" ticket. How do you make a distinction between what
is the most appropriate ticket, because some tickets are open
tickets and that might be considered to be the most appropriate
ticket when they are trying to sell the ticket to somebody? How
do you make the distinction between that and ensuring that someone
gets offered the cheapest ticket by telling them they could go
on a fixed time and pay less?
Mr Mapp: In simple terms it is
the cheapest ticket for that point in time at which the customer
wishes to travel. If the customer can obtain a cheaper ticket
by varying their travel time they will be made aware of that,
but in effect it is the cheapest ticket for the time at which
the customer wishes to travel.
Q25 Mr Martlew: I can believe your
figures because if you are travelling daily in from Eltham you
get the standard ticket but I think the reality, if you are looking
at the amount of money people lose, it is probably much greater
than 1% of the total because it will be on the long distance journeys
that people will get the wrong priced ticket. This is partly because
of the fact that the staff have a very complicated system to work
at and it is also partly because some of the rail companies make
it so confusing, and deliberately confusing, that people just
do not know what is the correct price. You say 1% but what was
the percentage lost to the customer from this survey?
Mr Mapp: We do not measure it
in revenue terms but I think it would be a reasonable assumption
to assume that that 1% is spread reasonably equally across all
customers, in which case it would certainly intimate a 1% revenue
loss as well.
Q26 Mr Martlew: How can you say that
because the cost of a ticket from Carlisle would be £100-odd
and if you get it wrong by £25 that would be £25 but
the one from Eltham would be about £4 so if you get that
wrong it is going to be a lot less, is it not?
Mr Mapp: I think the simple answer
to your point is I do not know what the revenue effect is.
Q27 Mr Martlew: Thank you.
Mr Mapp: However, I think it is
a reasonable assumption that it should be very similar to the
overall effect in terms of the number of passengers affected by
it. Perhaps I could just come back to the point about complacency
because I would really like to emphasise the fact that we are
not complacent about this. We understand that customers do get
sold the wrong ticket and we are doing a number of things to improve
our performance in that regard. There are a number of things that
we are doing over the next 12 months which we hope will improve
matters for customers.
Q28 Chairman: Such as?
Mr Mapp: Most importantly, our
proposals for fare simplification, which were set out in the White
Paper, which we plan to introduce during the course of 2008. That
will introduce a simpler national fare structure based on four
ticket types and we hope by doing that, in conjunction with the
way in which fares are presented on the Internet and other forms
of communication, customers will be able more easily to make sure
they understand the fares on offer and obtain the most appropriate
fare for the journey which they are making. There are other work
streams that we also have, including having a look at the way
in which ticket fare choices are presented on self-service ticket
machines with a view to improving those presentations. We are
also developing what we call the price promise, something that
was asked for by the Government in its White Paper, where we will
set out in clear and simple terms the things that we will do and
commit to doing to make sure that customers obtain the best priced
fare for their journey.
Q29 Mrs Ellman: Are you planning
to run down rail ticket offices?
Mr Austin: I touched on the point
earlier. Run down is not the right word.
Q30 Mrs Ellman: Reduce the availability
of them?
Mr Austin: Clearly, as more people
buy away from the station, the need for ticket office staffing
levels to be maintained at their present level will reduce and
so the expectation is, yes, there would be in the long run as
people shift away to other forms of ticketing a reduction in the
cost of operating ticket offices through the reduction in staffing
levels.
Q31 Mrs Ellman: You make it sound
as if that is driven by cost and not the needs of the public.
Do you not think that there are many members of the public who
wish to go to a ticket office rather than use the other means,
which might be very simple for a lot of people but not for some
people?
Mr Austin: Absolutely, and I am
not suggesting in any way that we will get to the point where
there is no facility at main stations to provide the service that
customers are looking. The fact is however that more and more
people, as Mr Mapp has indicated, are choosing to book off-line
from the comfort of their own homes, either via the Internet or
via telephone link or to use smartcard products like Oyster which
they can top up without ever going near a station.
Q32 Mrs Ellman: Do the current regulations
specify a particular level of ticket office availability?
Mr Austin: Yes they do and that
was my point. That is set in aspic whereas the reality is that
customer demand is changing. We cannot respond to that because
of the regulation.
Q33 Mr Scott: Do you think it is
acceptable, if you take for example London, you are penalised
financially if you use the old-fashioned commodity called cash?
Mr Austin: Sorry to pause on that,
I am not sure that that is actually right. In what way did you
have in mind? I know there is differential pricing on the Underground
for Oyster but at the moment that does not apply to national rail;
the tickets are the same price whatever method of payment is adopted.
Q34 Mr Scott: I was referring more
to where you would be adopting something such as that for rail?
Mr Austin: Inevitably as a joint
product we will be moving to the same sort of offer that London
Transport has in areas where Oyster is accepted, yes.
Q35 Mr Scott: So people would pay
a higher price if they use cash?
Mr Mapp: At the moment we are
not allowed to do that within the regulatory framework.
Q36 Mr Scott: You say, understandably,
that the Government's concessionary fares policy only looks at
one mode of transport and does not consider rail services, but
that extending it to rail services would need careful thought.
Can you see a sensible national extension of free concessionary
fare schemes that would include some rail journeys without incurring
high costs or overloading already busy trains?
Mr Austin: I think that is a very
difficult thing to do because it is quite difficult to distinguish
between short distance and long distance travel. They tend to
share the same trains, for example between Coventry and Birmingham
and Macclesfield and Manchester, and you have shorter distance
passengers using longer distance trains. The worry would be for
us that whilst we would welcome the extra business, providing
it was properly paid for, the experience with the bus industry
is that it has led to considerable overcrowding. We already have
a lot of overcrowding that we are tackling on the rail system
at the moment so if that were to be the case, and to encourage
a lot of additional off-peak traffic, we would need support to
enable us to expand the capacity of the rail network to cope with
it.
Q37 Mr Hollobone: To follow on from
Mr Scott's point about the Oyster card and the differential charging
for cash and Oyster, in your answer, Mr Mapp, you said under the
current regulatory framework you are not allowed to differentiate
the price. Will that be the case then when the ATOC companies
introduce the Oyster card in London?
Mr Mapp: At the moment I am not
aware that the DfT plans to make any specific change to the regulatory
framework to allow for that. I think it is true to say that we
have argued the case with the DfT for there to be greater freedom
with regard to pricing and indeed for us to be given the ability
to differentially price, by which means we will be able to do
that. Whether in the context of Oyster introduction we would choose
to then introduce a similar pricing regime to that introduced
by Transport for London, I think is a question that we have not
fully addressed.
Q38 Mr Hollobone: As it stands at
the moment there would be a substantial difference between a passenger
in London on an overground train on one of your companies where
there would not be a financial penalty incurred, as on the London
Underground at the moment, in buying a ticket for cash?
Mr Mapp: That is correct.
Q39 Mr Hollobone: With regard to
fare dodging, is it right that you think that nationally the loss
of revenue from fare dodging amounts to some £400 million
or about 8% of revenue?
Mr Austin: That is the figure
that we put in our paper. I would say that it is an informed guess,
an informed estimate. There is no consistent across-the-board
survey of this although individual train companies do research
it on a regular basis. It is our best estimate of what it is likely
to be.
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