Rail 400: Recovery not on the cards without a national railcard

When the railway launches its great marketing effort to win back lost passengers after the crisis, CHRISTIAN WOLMAR suggests train operators should overcome their traditional reluctance and introduce a national ‘recovery railcard’ to tempt travellers to return to rail. Meanwhile, Wolmar also believes the Docklands Light Railway could be a model for the SRA to set tighter targets for franchise operators on ‘heavy’ rail.

Some months BC – Before the Crisis – I suggested in this column there should be a kind of national railcard which would allow off-peak cheap travel for all holders.

It seemed to be an obvious extension of the current rather messy system whereby groups of people qualify for discounts on a rather arbitrary basis, such as those who happen to live in the South East.

The response from the Association of Train Operating Companies was defensive. Its Railcard manager wrote back at length arguing that a national card would possibly lose operators money as it would give existing travellers a cheaper journey. It would, he argued, “reduce our revenue flows significantly”. Reducing the cost of tickets by a third would require 50% extra travel to make up the loss, he argued.

Leaving aside the fact that the arithmetic was faulty and he didn’t take into account that the card would be paid for (say £20), I let the matter rest for the time as there were other fish to fry, but clearly this is the time to raise it again.

As mentioned before in this column, once the railways are back to a normal or near-normal state, then there is going to have to be a strong marketing effort to attract back the lost passengers. There is, thankfully, a growing recognition among industry executives that it is not just a simple matter of sitting back and watching ticket sales rise again.

As an aside, there is a slight concern about when we can finally say that we are in the AD [After the Debacle] period again. Looking at a map recently of the speed restrictions still imposed, there was a swathe of red showing affected sections of line concentrated particularly on the East and West Coast Main Lines. Given the arbitrary way that these restrictions were imposed, some operators are extremely concerned that the removal of the final ones will take a long time, even beyond the Easter deadline now being suggested.

As one InterCity operator put it: “Some pompous prat will want to reserve the right to slap on an Emergency Speed Restriction just to show how powerful he is.” Indeed, Railtrack’s estimate of the date of removal of the restrictions is always a few months ahead – first it was around Christmas, then January/February and now Easter.)

Therefore, the obvious tactic would be to have a big marketing initiative to get people back on the rails, and what better idea than a general discount through a mechanism like a railcard?

In response to the argument about lost revenue, there is, of course, already a generally available railcard – the Network card used in the South East. This would appear to counter the argument that there should not be a general card to go along with those available to young people, the disabled, military personnel and pensioners.

There are some 300,000 holders of the Network card and while some restrictions have been added to reduce the hours of travel on some lines in the morning peak, the card has survived privatisation. This is largely because, as ATOC admits, the card was introduced by Chris Green when he headed Network SouthEast a decade ago and it would now be difficult to abolish it as there would be an outcry from the very active London Rail Passengers’ Council. “We are where we are,” as ATOC put it.

But there is some acceptance that the crisis has changed the situation so radically that the industry realises it must be innovatory in its approach to recovery. So come on, chaps, think the unthinkable and bring in something like a ‘recovery railcard’, although you will need to dream up a better name.

Docklands: the way forward?

To get away from endless discussions about rail recovery, it was pleasing to drop into the headquarters of the Docklands Light Railway next to Poplar station in East London to hear about an unequivocal rail success story which may well have important lessons for the National Rail franchising system.

The DLR is a bizarre system. Its driverless trains scuttle about a network that is largely laid out as a conventional heavy rail system, apart from a few remarkably sharp bends (with radii of just 40 metres) and steep gradients where you feel like you are on a big dipper rather than a proper train.

The ‘train captains’ are trained to take over if necessary, and operate them under instructions from control. There are no signals as the trains are controlled by a moving block system, using loops every five metres which the Jubilee Line was supposed to mimic but has, so far, been unable to. The system was originally developed as a cheap sort of tram system along largely existing abandoned track, costing a mere £77m, but with various extensions and a change in computer system, the final price is pushing £1bn. There is now little to distinguish it from a normal heavy suburban railway.

The new Lewisham Link has been very successful, carrying nearly 10 million people in its first year. Built as a separate Public Finance Initiative scheme, this was originally to have been funded by a 50p toll for every passenger crossing the Thames, which would have been collected by staff on the trains. But the DLR managers persuaded John Prescott this would be unworkable and the fares have been kept the same as elsewhere on the system.

Instead, the DLR has bought extra trains to meet the demand which the lower-than-planned fares generated.

The Lewisham link was established by that most dynamic of Tory Transport Ministers, Steve Norris, and he had the toll system imposed upon him, even though privately he knew it was a mistake. According to David Quarmby, the Chairman of the DLR, another error in the way the Lewisham deal was structured was to pass on the revenue risk to the consortium building the line, even though there were so many uncertainties that it was impossible to forecast future revenue.

Quarmby argues that “the fundamental principle of any PPP [Public Private Partnership] is that you should only transfer that risk to the private sector which they can actually manage.” This is an oblique criticism of the PPP envisaged for the London Tube which involves private companies taking over the infrastructure, including tunnels, where the risks are totally unquantifiable because of their age.

All that happens when you transfer such risk, according to Quarmby, is that the cost of the scheme goes up as the private firms discount the risk at a high rate.

Now the DLR is expanding to the City Airport and there are plans for extensions to Stratford International, using North London line tracks, and to Woolwich Arsenal, south of the river, but these will be built under ‘build and maintain’ concessions, with no transfer of the revenue risk.

Unlike the Tube, which is not being handed over to Transport for London (TfL) until after the controversial PPP deal is signed, the DLR is already under the control of TfL. It is run as a franchise, due to expire in 2004. As with the National Rail franchises, the franchisee – Serco, a bidder for Transpennine and Wales – takes the revenue and has to meet certain performance standards. But the franchise agreement is rather tighter than those for National Rail. As well as reliability and punctuality, there are standards on lifts, escalators, passenger information display, ticket machines and customer satisfaction.

All these are currently being met, and surely there are lessons here for the Strategic Rail Authority, suggesting that much more precise targets can be set for franchisees.

Of course, these require extra subsidy but as there is more money swilling in the system, the SRA should address these ‘soft’ issues as well as boring old punctuality and reliability.

One of my particular obsessions is lighting. Going through East Croydon station the other day, I was impressed by how well it was lit. Better lighting improves the whole feel of a station, reduces vandalism and, most important, improves the perception that the station is safe. Surely it would not be too difficult for the SRA to set standards of lighting based on numbers of people using particular stations.

Other ideas could include provision of shops which also sell tickets at stations, as pioneered by Connex, or the granting of licences to station agents, highlighted in my article on Ledbury in RAIL 389. Surely such agreements could be part of the franchise specifications to boost rail usage and to make life more comfortable for passengers. The rail crisis makes it even more imperative for the SRA to address these issues.

And what happened to the notion that all payments of subsidy should be checked against a ‘social inclusion’ index to ensure that poorer people were able to use trains?

By the way, for those concerned about the lack of strategy coming from the so-called Strategic Rail sAuthority, according to its website it issued no statement or press release between October 24 and Christmas.

Shome mishtake shurely?

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