Business

Reform of season tickets to be at heart of getting trains back on track

Until the pandemic struck, Mark Cameron used to spend £80 a day commuting for five hours between Portsmouth and the office of his financial services company in the City of London.

The 48-year-old has not done the journey since last March and has no plans to give up so much time and money again. “As fantastic as London is, the benefits do not outweigh getting five hours of your day back,” he said.

Such a dramatic change to the way millions of people work presents a challenge for the UK’s railways, which have built large parts of their infrastructure, services and revenue models around carrying commuters during peak hours.

Ministers and rail industry bosses are developing plans to entice passengers back on to trains, with reform of the ticketing system — particularly for commuters — the centrepiece of the proposals.

Sir Peter Hendy, chair of Network Rail, which owns and manages the railway’s infrastructure, estimated 20 per cent of commuters might not return, while Abellio, which runs franchises including Greater Anglia and East Midlands Railway, has suggested around a quarter of passengers will be lost.

Many of those that do come back are unlikely to travel in the same way. Just 12 per cent of commuters plan to travel five days a week after the pandemic, according to data released last week by passenger lobby group Transport Focus.

“Travelling has changed forever . . . the five-day long-distance commute has probably gone,” said chief executive Anthony Smith.

As Cameron’s experience demonstrated, railways felt the impact of the pandemic instantly. The number of people travelling fell to 5 per cent of normal levels, prompting the de facto nationalisation of the operators. That level has fluctuated since but never consistently risen above 40 per cent.

Rail fares rose 2.6 per cent this year, more than inflation, which the government said reflected the “unprecedented contribution” of taxpayers to keeping railways running. The rise was delayed from January to March to allow season ticket holders to renew at a lower price. 

The Department for Transport has written to rail operators asking them to draw up plans for flexible season tickets, and officials hope to roll out the changes by the end of the summer. Although plans have not been finalised, they are expected to offer savings of hundreds of pounds compared to a regular season ticket.

“We are committed to providing a more flexible, modern ticketing system for passengers. That is why we are looking at ways to make this a reality for commuters, including flexible season tickets,” DfT said.

Passenger groups have complained that the proposals do not go far enough, and some industry figures believe the Treasury, which has pumped more than £10bn into keeping the railways running over the past year, has resisted more sweeping reform as it is keen to keep the certainty of regular season ticket income. The Treasury declined to comment.

“Flexible ticketing is going to help, even if the price is not enormously brilliant value,” said Katy Taylor, chief strategy officer at GoAhead, which runs nearly a third of all passenger journeys in the UK across commuter-heavy lines Govia Thameslink Railway and Southeastern. “People like to feel they have a choice and they are getting value.”

Season tickets have become a smaller part of the railway’s overall revenues. Passenger revenue by ticket type (£), franchised season tickets and total franchised passenger revenue

In the short term, train companies are also focused on making sure passengers feel safe when they take their first ride back.

Near-normal timetables have helped the smaller number of passengers maintain social distance, and operators have invested in new cleaning regimes.

The industry can also point to Imperial College and Transport for London data published earlier this year, which found no trace of the virus after taking samples on the capital’s Underground and bus networks.

“Whether intentionally or inadvertently the government may have given the impression public transport is inherently unsafe, we don’t believe that,” said Andy Bagnall, a senior executive at the Rail Delivery Group, which represents the train operating companies in the UK. “We think it is no more or less risky than other activities in enclosed spaces”.

The regular commute was already in slow decline thanks to flexible working, and almost everyone involved in the railways, from passenger groups to government officials and company executives, were united on the need for reform even before Covid-19.

The franchise model was swept away in a matter of days last spring as passenger numbers collapsed. Ministers are moving to a new model where operators will be paid a fixed fee for running services and will be less exposed to the financial risk of fluctuating passenger numbers.

“What the pandemic has done has accelerated things. It has poured petrol on what was already a burning platform,” said Bagnall.

Some within the industry think this could be the moment to look at the entire structure of the railways, and whether leisure passengers, who have been returning in greater numbers than commuters, should be prioritised.

Hendy has suggested engineering works, which normally take place at weekends and holidays, could be moved into the week if leisure passengers eventually become a priority.

Ultimately, industry executives believe the future of the railways as commuting arteries is inextricably linked to the future of the city as a workplace.

For Cameron at least, the genie is out of the bottle. “Why do we need to get back on the trains?” he questioned. “As much as I like going into and supporting business in the city, I would rather support my local corner shop.”

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