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Transport Committee - Rail 2020Written evidence from Mr Richard W Malins (ROR 34)

Richard Malins has over 45 years of railway experience, 30 of those years working for British Rail, which he joined as a graduate trainee in 1966. For part of that time he held positions of responsibility in the field of revenue protection, including the introduction of the concept of Penalty Fares, and ticket vending machines. Subsequent to privatisation he set up Transport Investigations, a business that provides consultancy and support services in ticketing systems and customer information. This has included surveys and advice to franchise bidders, with clients in London and across the UK and Ireland. He is also well informed on railway practice overseas. He is an acknowledged expert in the area and gave evidence to the Committee for its Fourth Special Report in 2007–08. He has held positions in the Railway Study Association and the Retired Railway Officers’ Society that give him a wide range of industry contacts, and he has been a regular contributor to the railway technical press.

The Transport Committee’s Rail 2020 Inquiry Session on 10 July 2012

At this session the Committee returned to a subject first addressed in the Fourth Special Report into Ticketing and Concessionary Travel on Public Transport issued in April 2008.

Recommendation 9. There are moves to install ticket gates at more rail stations. Yet ticket gates are not a panacea. They cannot be used by all passengers and staff are still required to be present. Gates introduce new drawbacks including delays and obstructions for passengers; they are not in keeping with historic stations; and they are not always the best method of protecting rail revenue. The Government, in consultation with the rail industry and passenger groups, needs to review this one-track approach and develop a more holistic policy. (Paragraph 60).

In their response the Government said it believes that effectively deployed gating, together with the associated staff, can be an effective solution to the issue of revenue protection. It is understood that not all passengers have the same needs, which is why the Department for Transport stipulates that where gating is present, wide access gating must also be available. In the rail White Paper “Delivering a Sustainable Railway”, the Government has committed to looking at the role of gating across the network, together with operators.

The Government will therefore be running a project to examine several aspects of gating, including revenue protection issues, alternative control methods and consideration of passenger flow in view of the predicted increase in passenger numbers over the next 30 years.

There is no evidence that the Government ever actually ran any project to examine the several aspects of gating, or if it did, there was so little consultation on the matter that it was not possible for interested parties to make any contribution on the subject. Having given evidence to the Committee for the above report, an opportunity to submit further comment was not offered and my repeated submissions to the Department and the rail industry since are never met with any reasoned response. Meanwhile ticket gate schemes continue to proliferate, often at unnecessary or unsuitable locations. Research by Passenger Focus in 2010, as a part of their National Passenger Survey, into the “ease of use” of ticket gates suggested that while they appeared acceptable to commuters they were causing a significant proportion of passengers difficulties at stations with a more general user profile. This research has not been followed up, and Passenger Focus has not challenged this continuing proliferation.

I was therefore particularly interested in this exchange:

Q282 Steve Baker: Is the Department right to mandate ticket gates as the preferred strategy for revenue protection?

Steve Howes: I am not sure that they do mandate gates as their preferred strategy for revenue protection. Train operators are encouraged to install gates where there is a de facto case for having gates. Clearly they are an effective means of revenue protection, and most typically in inner and outer suburban commuter markets. For long distance, revenue inspection on-train obviously remains an important part of the overall revenue protection mix and I think that will remain the case.

Steve Howes, as head of Rail Settlement Plan, gives a fair response here, but could be picked up on some points. What he says is correct, in that with a few exceptions (such as Nottingham and King’s Cross) the DfT does not mandate gates as their preferred strategy (I have a letter from Norman Baker that makes that claim), but there is encouragement to do so (I have evidence of that too from my own work on previous franchise bids, and their recent agreement with First Great Western). There is a kind of collective “group-think” fallacy at the DfT and in some TOCs that believes gates to be a sort of fail-safe revenue protection default with de-facto business cases. Often there is no real case at all and it is actually a zero sum game. Some locations, after any initial disturbance of ticket purchase patterns has worked through, will be no better or worse for fare evasion now than before any barriers went in, but there is a cost and there can be degradation of the station’s amenities. This could be relevant to the 5th September enquiry, as there are instances where the presence of a closed-off paid-area reduces station trading opportunities, both in actual revenue and potential sites. Claims of improved security are often spurious as much of the crime risk remains and less frequented stations can feel less secure.

There are two particular ongoing gating sagas that involve MPs.

At Sheffield where the situation prompted the Sheffield Central MP (Paul Blomfield) to raise the issue in an adjournment debate on 14 December 2011. (Transcript with comments enclosed). The subsequent manipulation of the situation by DfT officials, who keep trying to revive the scheme as an unfulfilled franchise commitment by East Midlands Trains, is ridiculous. Their insistence that there is no alternative to barriers, quoting absurd numbers for revenue loss and the staff needed to combat it without gates, led Justine Greening to offer a subsidy for a new footbridge to facilitate the gating scheme. Logically this proposal is now overtaken by the announcement of electrification of the railway there as there are clearance issues for the existing bridges.

Gatwick Airport, mentioned below by Steve Baker, is another attempt to enforce a franchise commitment. While it is correct that Southern, with DfT encouragement, put barriers in their bid, like Sheffield it was never consulted upon before being contracted, and the train operator later thought better of it. DfT would not accept a variation and insisted on the commitment being carried out. Norman Baker boasted of this in the Sheffield parliamentary debate already referred to in December, and the result is a complete trashing of service on the Gatwick Express.

Steve Howes should also have admitted that outside commuter environments like London, ticket barriers are not properly supported by the ticket technology (unlike LUL where it is very good) and there is an unacceptably high rate of incompatibility and wrong ticket acceptance or rejection. That taken with people unfamiliar with the system or encumbered means there is a very high degree of manual intervention, with consequent degradation of customer service and ticket checking. Also the assumed throughput rate of over 20 passengers per gate per minute is quite unrealistic, it should be nearer 12 and yet safety cases are based on the higher number. No-one in the national rail world of group-think wants to recognise any of these issues, and the Rail Safety & Standards Board, as custodian of RIS-7701-INS “Railway Industry Standard for Automatic Ticket Gates at Stations” has thus far ignored this point. They say “RIS-7701-INS provides an estimate of gate throughput based on the experience and recommendations of the industry drafting review group, concerning the reliable operational performance of ticket gates under all conditions”.

Q283 Steve Baker: I understood that barriers had been mandated on the Gatwick Express and other non-commuter journeys.

Steve Howes: For services of certain sorts where there is high density and high throughput, yes, gates are absolutely the best solution.

If the TOCs were to stick to the commuter market with high density/high throughput stations there would not be too much argument about the topic. It’s their intrusion into the non-commuter market that is the concern. The latest news that the West Coast franchise is to be awarded to First Group, a long-standing proponent of universal gating, is a matter of concern. Virgin was the only InterCity operator to stick with the BR open stations policy, and only about 8% of its passengers had to pass a ticket barrier (at stations run by others like Milton Keynes). Now First propose to gate 21 stations, which is almost all of the West Coast network and virtually 100% of their passengers will have to negotiate barriers, for most of them at both ends of the journey. Given what can be observed at ticket barriers on similar stations elsewhere this is a step change (down) in customer service, largely unremarked upon in the furore so far. Unless this major step is challenged it will make ticket barriers appear standard practice and the position at York and Sheffield, where they have been strongly opposed by the community, seem ever more anomalous. There is evidence that ticket barriers are only effective in controlling short distance revenue and are not relevant to longer journeys, where on-train inspection, as Steve Howes says, remains important. There is also evidence that where barriers are provided, on-train staff then relax their efforts and vigilance, so in their net effect they may in practice be counterproductive.

Q284 Steve Baker: Whose responsibility do you see it being to protect revenue? Is it the responsibility of the Government or the train operating companies?

Steve Howes: Absolutely the train operators. They have the primary responsibility for protecting revenue.

This excerpt from the Invitation to Tender for the recently awarded West Coast franchise suggests that the DfT does not see it this way, although this approach, repeated in the Indicative ITT for Great Western has been moderated in the final version recently issued:

3.4.5 Station Gating and Gate-line Staffing

Bidders should consider maintaining the existing levels of gate line coverage at minimum throughout the franchise term. Where a bidder proposes not to do this then any alternative solution being offered by the bidder should be set out in its bid plan. Bidders are free to propose additional gates at locations where they would ease emerging passenger flow issues. Where gate lines are operated, bidders are expected to provide plans for appropriate staffing levels and this should be included within the Ticket Sales and Revenue Protection Delivery Plan.

Q285 Steve Baker: Given the emerging technologies, things like print-at-home, how do you see barriers fitting in?

Steve Howes: The print-at-home proposition today is only available for advance purchase tickets associated with a seat reservation. That is obviously because you can fairly easily duplicate a print-at-home ticket. We are hopeful and are exploring ways in which we can extend the print-at-home proposition to other forms of ticket, and open tickets particularly, which are not associated with a specific seat reservation. That would require some level of on-journey validation so that the revenue protection inspector could check that it is a valid ticket.

It is not quite true that print-at-home tickets are only associated with advance bookings and seat reservations. Gatwick Express for one (and there are others) issues regular ticket types that way, and suitably fitted gates can read barcodes quite well. It’s just that the passengers often don’t know how to present their sheet of paper, and on East Coast for example, currently a Government owned company, there are inconsistent and confusing practices. At gatelines managed by East Coast there are bar-code readers where gates are provided, but none where there are no gates or they are not managed by East Coast. The latter category includes Leeds, the busiest East Coast station outside London. At King’s Cross the gates are made by Cubic and have upward facing bar-code readers, whereas elsewhere on the route they are by Scheidt & Bachmann with forward facing readers. Passengers are expected to work this out for themselves, and what to do when there are no readers. There is a further difficulty with the current standard credit-card sized magnetic ticket in that, although gate compatible, for many journeys several are issued for one transaction. This includes separate tickets for outward and return journeys, seat reservations and receipts. Selecting the right one to operate a ticket gate is a challenge for the inexperienced.

Britain is unique in Europe in re-applying the closed station principle to all types of travel. Elsewhere ticket barriers are only used for metro and commuter services where the density of short-distance traffic makes other methods of revenue protection less effective. In some countries however they are unknown and the open station +principle is universally applied. No rationale has been advanced for such an indiscriminate application of ticket barriers here, but the suggestion is often made that it has more to do with a surveillance agenda than sensible revenue control. The news that the Home Office continues to pursue rapid screening technologies that could be installed at controlled points within stations suggests that the encouragement to install ticket gates rests beyond the DfT in government.

Additional Comments on the West Coast Franchise Competition

I am not in a position to comment on most aspects of the West Coast Main Line franchise award, and I did not work on any of the bid teams in this case. I have however worked on a number of previous bids in the revenue protection field and I did undertake a review of the topic for First Great Western so I am familiar with First Group’s approach and philosophy on the subject. First claims to be the principal proponent of barriers on the Inter-City railway, and there is evidence for that on Great Western, so it has become some sort of fixed doctrine towards finding extra revenue for them. Having had the recent opportunity for a serious look at Great Western, I believe that strategy to be misplaced, both in customer service and net revenue terms. Despite contrary advice they agreed with the DfT to proceed with gates at a number of their stations (Cheltenham, Gloucester and Taunton are examples) for which no business can be envisaged and where there would be negative impact from the schemes.

First propose to gate 21 stations, which is almost all of the West Coast network and virtually 100% of their passengers, for most of them at both ends of the journey. Given what is known about the unsatisfactory operation of ticket barriers at similar stations elsewhere and can readily be observed, this is a major step-change down in customer service, largely unremarked upon in the debate so far. At present only about 8% of West Coast passengers encounter a ticket barrier, at stations managed by others (such as Milton Keynes), and in particular there is easy access and egress at most of their major stations. Although without an opportunity to examine these in more detail, and access to any relevant data on fare evasion, I cannot see how this move to a check at both ends of the journey will enhance customer service and more important net revenue to the franchise. Capital costs of equipment and enabling works are likely to be in the order of £12 million and annual running costs for maintenance and incremental staffing will be some £3 million. There is a sound body of evidence to suggest that gates are only effective in improving revenue control for short journeys and that benefits to a longer distance operator are negligible, indeed they may even be negative since gates do not address many of the causes of revenue loss (class of travel, possession of a valid railcard, use of the correct train etc) and on-train staff tend to relax their efforts once gates are installed. While there may be some local benefit in the Midlands or North West, little of this will accrue to the West Coast franchise where the regional flows represent a very small proportion of revenue, and it is not clear whether these extra costs will be offset to those beneficiaries. First also claims that ticket gates improve security through better crowd control and the curbing of anti-social behaviour. There is scant evidence to support that too, since barriers are invariably opened when there is crowding, and any impact on behaviour is dependent on a staff presence, rather than equipment.

So while I do not know enough about the other assumptions that lie behind First’s successful bid for the West Coast franchise, in this particular area, I believe they are flawed, and if the gates under-pin even a small amount of the predicted flows of extra revenue, then they could be in error.

West Coast Invitation to Tender Document: 3.4.5 Station Gating and Gate-line Staffing

Bidders should consider maintaining the existing levels of gate line coverage at minimum throughout the franchise term. Where a bidder proposes not to do this then any alternative solution being offered by the bidder should be set out in its bid plan. Bidders are free to propose additional gates at locations where they would ease emerging passenger flow issues.

Where gate lines are operated, bidders are expected to provide plans for appropriate staffing levels and this should be included within the Ticket Sales and Revenue Protection Delivery Plan.

Gate lines will be introduced at Birmingham New St on a phased basis during the early years of the new franchise. Bidders are required to detail plans for staffing and maintaining the gate lines from the completion of Gateway Phase 2 (see point 3.3.1.1)

Bidders are free to provide proposals for additional gating schemes where a case can be demonstrated and where the gating schemes are deliverable. Bidders should pay particular attention to potential negative impacts of any proposed scheme.

Bidders will be required to set out when such gates will become operational, and the hours when the gates will be staffed, reflecting the security and other benefits gating schemes bring.

20 August 2012

Prepared 5th January 2013