Appendix A
INNOVATIVE TICKETING TECHNOLOGY
The RDG believes that innovative technology is the
key to delivering a significant change in the ability of the industry
to meet demand whilst improving its efficiency. It has established
a working group to spearhead the implementation of innovative
technology throughout Britain's railways. This group's role is
to encompass strategic thinking in relation to the areas of smart
ticketing, information systems and communications technology.
In developing the strategy for future ticketing,
the working group is consulting with a number of industry stakeholders
including the Association of Train Operating Companies (including
National Rail Enquiries), Rail Settlement Plan (RSP), Transport
for London, Passenger Focus and the Department for Transport.
It should be noted, however, that as Britain's railways
are a heavily regulated industry, a successful strategy for future
ticketing will always rely on partnership working between key
industry organisations, such as the RDG, and the Department for
Transport (DfT); as the DfT is ultimately responsible for the
overarching policy direction of Britain's railways.
The DfT's Fares and Ticketing Review is due for publication
in summer 2013 and RDG members have already contributed to the
consultation stage of this document. In addition, the DfT has
asked for further contribution from the industry in the development
of the Fares and Ticketing Review. As a result of this, RDG members
are currently engaging with the DfT to assist with this task.
Once the Fares and Ticketing Review has been published, the RDG's
strategy for future ticketing will continue to evolve in the light
of its findings, as further clarity on the future of fares regulation
emerges.
A range of initiatives have already been set in motion
by the industry which involve the delivery of lower cost but better
quality and more integrated ticket retailing opportunities; and
the introduction of smart media and other technologies to enable
new innovative ticketing to be introduced on the railways.
THE VISION
The RDG's vision for the evolution of ticketing technology
on Britain's railway system is based around two complementary
objectives:
Making ticket purchase easier and more straightforward
for customers
- Ensuring customers are able
to access a full range of tickets and are able to easily purchase
the best value ticket for their journey;
- Introducing new flexible ticket types and channels
which better suit customers' changing needs;
- Offering better quality information at the point
of ticket purchase, including details of any ticket restrictions
and train times / real time train running information; and
- Supporting integrated travel and more sustainable
end-to-end journeys through joined up ticketing between rail and
other modes.
In summary:
- A more transparent and open
ticketing system which makes ticket purchase easier and convenient
for customers.
Ensuring that ticketing contributes towards a
reduction in the overall costs of the railway
- Delivering a more cost-efficient
ticket distribution model for the rail industry, supported by
smart ticketing and other innovations;
- Reducing fraud through moving towards the removal
of magnetic stripe ticketing from the industry;
- Working with the DfT on pilot projects such as
those identified within the SEFT programme and the DfT's recent
Door to Door Journeys Strategy, to introduce
a more flexible range of smart ticketing choices.
This may include the facilitation of demand management trials,
which would perhaps offer financial incentives to customers to
travel outside of the peak hours; and
- Over the years the rail industry has layered
new retail channels on top of existing and as such has built both
technical complexity and more cost into retail systems. Moving
forward with any new strategy / vision, the aim must be to remove
complexity and cost, and not add to it as new retail channels
are adopted. However, the industry does require government support
to achieve this, as much of this complexity is part of the structure
of existing fares regulation.
In summary:
- A more efficient ticketing
system which delivers taxpayer and customer value.
Current progress
The Fares Initiative:
- There have been long standing
concerns by industry stakeholders and passenger groups that rail
fares are too complex, and result in a lack of trust amongst passengers
that they will be able to buy the best value fare for their journey;
and
- The programme of initiatives broadly fall into
two categories: a programme of short-term 'quick wins'; augmented
by a longer term replacement of the current fares database and
service.
- Short-term initiatives (to be delivered during
2013) are focused around improving the quality of fares information,
both through information/sales channels and on tickets; and
- Longer term (2014 onwards), a replacement fares
system is being procured which will include much greater flexibility
for TOCs when setting prices and creating products, allied to
improved distribution, ensuring that fares data is supplied in
a single consolidated source to all outlets in a form fit for
retail use.
New ticketing technology:
- Smart ticketing has been dramatically
successful in London with the Oyster card, which has transformed
the ticketing landscape over the past decade. The rail industry
is now working to deliver smart ticketing outside London using
the ITSO standard. There are a number of projects which are ongoing
within the rail industry at the moment which aim to harness the
potential for ITSO technology to transform customers' ticketing
experience;
- To help facilitate this, the ITSO on Rail standard
(RSPS 3002) has been recently completed and published. This was
a collaborative exercise by train companies, TfL, PTEs and ITSO
Limited. This fully defines how ITSO ticketing is to be delivered
in the railway, and includes support for innovative ticket types
such as carnet based ticketing and pay-as-you-go ticketing;
- ITSO on Prestige, which is being delivered this
year to allow ITSO cards to be used in parallel with Oyster cards
inside London will act as an enabler for ITSO cards to be used
between stations outside London and the TfL environment;
- A number of TOCs have franchise commitments for
the introduction of ITSO ticketing on their services. Progress
to date has been focused around proving the technology works and
passenger take-up has therefore been fairly modest. However, with
the advent of ITSO on Prestige during 2013, ITSO smartcard take-up
will be much more extensive;
- The SEFT project is a welcome development for
the industry, and extends ITSO ticketing to other train companies
serving London who do not have existing franchise commitments
for ITSO ticketing. This project will deliver a critical mass
of smart ticketing and involves 12 train operators who serve the
London area. 300 stations are to be upgraded to support smart
ticketing, with the aim of reducing queuing times and enabling
faster entry and exit times through stations, as well as facilitating
innovative new ticket types to be introduced on a wider scale;
- Alongside ITSO ticketing, a number of other new
technologies are emerging which will begin to give customers additional
choice and flexibility in purchasing rail tickets, whilst allowing
operators to target the right sort of ticketing solutions for
the relevant services. Some train operators have introduced mobile
barcode tickets, and print at home tickets; both of which work
well for longer distance services with more occasional travellers
who are more typically business and leisure passengers;
- We are also observing with interest TfL's Future
Ticketing Project, which is introducing Contactless Payment Cards
to London's transport network to operate alongside the existing
Oyster system. The results from TfL's initial rollout of this
new payment mechanism on London's buses have been encouraging
to date and TOCs whose services operate within the TfL zonal area
are currently in discussions with TfL about the potential for
also extending Contactless Payment Card acceptance onto TOC services
as well as TfL's own operations; and
- RDG recognises TfL's move to Contactless Payment
Cards for ticketing in London as another important technological
advancement and sees a joint future strategy with TfL and the
wider rail industry as essential for the success of integrated
future ticketing.
Integrated ticketing:
- The RDG recognises that a customer's
journey rarely involves rail as the only mode of transport, and
that ticketing has a key role to play in supporting a sustainable
door-to-door journey. We very much welcome the DfT's recent Door
to Door Journeys Strategy and its vision for a more joined up
transport system which is supported by smart and integrated ticketing.
RDG will be supporting the DfT in realising its aims for this
strategy;
- Contactless Payment Card acceptance on transport,
also referred to as EMV ticketing, is a positive development for
integrated ticketing as it has the potential to significantly
change the landscape of transport ticketing. The move towards
an open payments approach to transport could in time make public
transport much more accessible by reducing the barriers to integrated
travel for many consumers, and also potentially lower the cost
of retailing tickets for public transport operators. However,
we are mindful of the differences between deployment of such ticketing
on urban areas compared with longer distance train and bus services,
where fare levels are more variable and complex. Therefore Contactless
Payment Cards may not be appropriate in all circumstances; and
- Seamless ticketing between modes is crucial,
which is why we strongly supported Plus Bus and associated initiatives,
and continue to do so. In addition, ITSO and EMV as common standards
for contactless ticketing and cards, gives a unique opportunity
for bus, rail and other modes of transport to be brought together
under a single ticket or card based proposition for customers.
A number of initiatives are already exploiting this potential
across the country.
Lowering the cost of sale:
- The RSP Modernisation Board
is looking at a range of initiatives to reduce the cost of sale,
including procuring replacements for legacy systems such as RJIS
and LENNON which were originally delivered a number of years ago
and are now outdated, but also carry a high residual operating
cost;
- Since that time advances in open standards and
architecture, and cloud based computing have the potential to
realise significant cost savings for the industry. Additionally,
by moving towards new central systems which reduce complexity
and align with a more standardised industry approach to IT, we
have identified the opportunity to reduce barriers to entry to
the rail industry for new suppliers, which will therefore increase
the supplier base and improve competition; and
- Alongside modernising systems, we also are looking
at setting a date for the removal of magnetic stripe tickets from
the industry so that the potential cost savings from the introduction
of smartcard ticketing products are fully realised.
In summary, we trust that this brief summary has
shown some of the work RDG is doing in relation to ticketing and
retailing. The progress we are currently making is within the
context of the current DfT rules and franchise requirements. Once
the DfT provides further clarity on the future direction of fares
regulation in the Fares and Ticketing Review, we will be able
to update this strategy and present a more integrated approach
to this area which will maximise customer and industry benefits.
Appendix B
IMPROVING RETAIL FACILITIES ON STATIONS AND ON TRAINS
Over the last five years there have been a number
of calls for the production of a strategy to improve retail facilities
on stations and on trains.
The Better Rail Stations independent review recommended
that 'a strategy should be developed to capture a potential 60%
increase in station trading worth up to £44m at 'A' - 'C'
stations.'[3]
The Rail Value for Money (RVfM) Study made a number
of recommendations regarding retail development and stations.
These are summarised in Section 6.4.5 of the RVfM Summary Report.[4]
Detailed arguments and recommendations are included in the detailed
report of the RVfM Study.[5]
The House of Commons Transport Committee issued the
Seventh Rail 2020 report in January 2013 in which it stated "We
recommend that the Rail Delivery Group, working with Passenger
Focus, develop and publish a clear strategy for improving retail
facilities on stations and trains. This would be welcomed by passengers
and could generate extra revenue to contribute to achievement
of the McNulty targets".[6]
Witnesses to the Transport Committee made a number
of statements regarding station retail.[7]
The Committee noted that retail facilities
at major stations were evolving to become destinations
in themselves, particularly new developments
such as St Pancras International and the redevelopments
of King's Cross and Waterloo stations in London. However, in the
view of the Committee
there remains scope for Network Rail and the train operating companies
to generate more revenue
from the railway.
The Committee also stated that retail offerings at
stations can be tired and uninspiring or at many stations non-existent
and felt that on-train retail is often similarly unimaginative.
The committee expressed the view that the facilities at St Pancras
International station, now a destination for shoppers and people
eating out, have set a standard to which other major stations
should aspire.[8]
In the light of these comments and recommendations
the Rail Delivery Group has agreed to work with Passenger Focus
to develop and publish a strategy for improving retail facilities
on stations and trains. The first stage is to inform the production
of the strategy by undertaking a review of the opportunities for
improving retail facilities on stations and on trains. The Rail
Delivery Group and Passenger Focus have discussed the remit of
the review, which is summarised below.
The initial review will identify the level and nature
of retail facilities that are both economically viable and deliver
the required level of facilities and retail environment and experience
that is needed and expected by the modern rail passenger. The
review will take account of emerging developments and future trends
in the retail sector such as multichannel retailing, new store
concepts and technologies. In addition to meeting the needs of
rail passengers the possible improvements need to be self financing
and scalable depending on the station size (or category) and/or
level of footfall. The review will also consider the barriers
to delivery of enhanced retail facilities.
The detailed issues to be considered by the review
include, but are not limited to, the following:
- An assessment of the current
retail offer to the rail passenger on trains and in stations;
- A benchmarking of the current station and on-train
retail offer both internationally and within GB;
- A description and justification of what today's
rail passenger expects from the rail retail environment and why;
- Identification of an improved retail offer; split
by station type / train service, including new retail concepts
such as collection of online purchased goods;
- A proposal for the measures, such as passenger
footfall, for categorising the improved offer;
- Provision of examples of best in class and justification
for that rating;
- The business case for enhancing the retail offer
by chosen category;
- An estimate of both the scale of the potential
improvements, their cost and financial returns. This will demonstrate
how enhanced retail can be used to produce funds that could be
deployed to fund investment, reduce fares or reduce the funding
provided by the tax payer;
- The barriers to delivery of improved retail facilities
including the competing requirements of operational and retail
needs;
- Provision of an analysis of external impacts
and synergies with the wider transport and retail arena such as
airports, motorway service stations and shopping centres; and
- Identification of any sustainable solutions that
would generate a positive impact on the environment.
Besides drawing on the extensive research already
available the review will also seek the views of a range of rail
industry stakeholders and other parties with an interest in developing
a strategy for station and on-train retail. RDG's partner in this
exercise, Passenger Focus, will provide the most important view
of all - that of the passenger. Other stakeholders that will be
consulted include:
- RDG Members (major passenger
and freight owning groups and Network Rail);
- Department for Transport, Transport for London,
Transport Scotland, Welsh Assembly Government and other funders
and stakeholders
- The Association of Train Operating Companies;
- Individual Train Operating Companies
- Existing station retail providers and occupiers;
- Owners and operators of facilities and services
comparable to stations and trains; and
- Retailers and retail developers.
The RDG and Passenger Focus will receive the initial
review in summer 2013 and will produce a strategy for improving
retail facilities on stations and trains later in 2013.
Rail Delivery Group
April 2013
3 Pages 55-59 Better Rail Stations, an independent
review, Green and Hall, November 2009 Back
4
Page 53, Realising the potential of GB Rail, Summary Report, Department
for Transport and Office of Rail Regulation, May 2011 Back
5
Sections 8.2 and 8.5, Realising the potential of GB Rail, Detailed
Report, Department for Transport and Office of Rail Regulation,
May 2011 Back
6
Rail 2020, House of Commons, 4 January 2013, Volume I, Report,
paragraph 49 (http://www.publications.parliament.uk/pa/cm201213/cmselect/cmtran/329/329.pdf) Back
7
Ibid paragraph 47 Back
8
Ibid, paragraph 49 Back
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