Published: 19th August 2013
The Office of Rail Regulation (ORR) generates many rail statistics and these show that demand for UK railways is still increasing despite the government’s policy of increasing fares more than inflation for the last decade.
A total of 1.23 billion rail journeys were made in the financial year 2011-12 which was an increase of 6% over the previous year which itself was the highest since records began in 1995-96 with the new ‘privatised’ rail system. The number crunchers analysed journeys within and between 11 UK regions segregated into:
East of England, East Midlands, London, North East, North West, Scotland, South East, South West, Wales, West Midlands and Yorkshire and Humber.
ORR also worked out that the total number of rail journeys undertaken purely inside England totalled 1.11 billion with just under 750 million, or 67% starting or ending in London. Rail use within the individual 11 regions went up by nearly 7% over the previous year while journeys between the 11 regions increased by just over 4%.
Scottish rail travel increased by 87 million journeys or nearly 5% and over 90% of these were made within the country. West Lothian and East Ayrshire recorded the largest increases, up by 17% and 12% respectively.
In Wales, rail usage also increased reaching 28.1 million journeys, an increase of almost 3% with journeys between Wales and other regions showing a faster rate of increase at over 5% totalling over 9 million journeys for the first time.
As could be predicted, London was used by more rail travellers than anywhere else in the UK with over 750 million trips undertaken. This means that 61% of all UK passenger journeys made included going to or from London. The recorded increase in journeys within London was 9% over last year helped by more trains and new lines opening.
So now we have a few statistics to refer to we can see that our railways are increasingly popular, so surely its right that those that use trains pay their way, right? Maybe not, some would argue. Motorists benefit from passengers using trains as roads are less congested and there are fewer lorries as freight by rail is also growing all the time so again. One container train removes up to 44 HGV’s from our roads creating safer driving conditions and reducing traffic delays.
And, don’t always assume the train companies are totally to blame for all the financial pain as they play by the franchise rules set by the Department for Transport (DfT). Many fares, including season tickets, are set by the DfT as part of the franchise agreement and are known as regulated fares. In essence it could be argued that the Government collects taxes (included in the price of your ticket) at little cost to themselves in similar fashion to garages selling fuel to motorist’s also collecting revenue for the Government.
Many contend that as our roads are so crowded, combined with rising cost of fuel and insurance, road users have switched to rail. But there seems to be no lack of traffic with many driving well over the speed limit on motorways and dual carriageways seemingly oblivious to these fuel costs.
The DfT arguably wasted the extra fares’ revenue generated by last year’s increase with their extra costs incurred with the franchising mess they created over the West Coast Main Line. This resulted in most franchises being extended for up to two years while a new process was devised and implemented. But obviously every franchise extension generates a high cost in legal, planning and operational fees and also creates uncertainty for suppliers.
One side of the rail industry will suggest that the increases will fund new lines, stations and trains. Others, mainly outside the rail industry, say that railways are a monopoly but again, some will contend that our roads provide a choice, but not a realistic one.
The Association of Train Operating Companies (ATOC) has issued some statistics. They claim in their ‘Growth and Prosperity’ report that train companies are generating four times as much investment money than 15 years ago. Their figures say that in 1997/8, the Government invested £400 million and last financial year the total was £1.7 billion.
While these figures are impressive, it must be remembered that the very first franchises were being let from the mid 1990s so nobody knew how the new system would financially operate in the financially complicated newly privatised railway world.
Passengers have seen their financial contribution to the railways rise over the last decade and now cover around 65% of the actual cost of their journey, up from 50% a decade ago. Despite this, passenger numbers have doubled in the last 15 years generating an extra £3.2 billion annually for the rail industry or the DfT. The ATOC report says, has generated 96% of the extra revenue with only 4% of the extra revenue attributed to the fares’ increases.
In the last year or so, Network Rail has built flyovers at Nuneaton and Hitchin with a third one at Stafford underway. New track has been laid near Ipswich to create capacity for freight from Felixstowe and at Nuneaton to relieve the West Coast Main Line.
Major work has been undertaken at Reading, Nottingham and Birmingham New Street stations this year which will further allow more trains to run offering passengers a greater journey choice. Currently underway is a major electrification plan reaching across the UK between Edinburgh and Glasgow, the northwest of England and reaching south to Southampton via Coventry and Oxford.
In addition new lines are being opened such as The Borders Line from Edinburgh to Tweedbank and between Milton Keynes, Aylesbury and Bicester. So far as on-board facilities are concerned, many trains have wi-fi allowing passengers to work while travelling.
This is a well known fact that if a line benefits from faster or more frequent services then house prices will rise even in difficult economic times. The speeding up of services also brings after a fashion, choice to commuters as to where they can live. There is a direct correlation between house prices and the length of the commute to a major town or city. This is often the reason some choose a long ride as the season ticket is still cheaper than a far higher mortgage but as fares increase, this relationship will change and could introduce new commuter traffic in already congested routes.
There have been three terrible railway accidents in recent months in France, Spain and Canada. Safety comes at a high price and the UK’s railways are about as safe as they can be. This has to be paid for and is a combination of train, track and signalling design combined with training and continual monitoring.
Security is also a 24/7 subject on the railways. The Transport Police say that despite the rise in passenger numbers, crime has fallen over the last few years. But the security presence at stations is clear to be seen with either staff patrolling or the banks of cameras that are monitored and obviously paid for.
So why should fares increase when delays are doing the same? Its all about capacity and the more trains there are, the less chance of recovering lost time there is. It is the same as on a motorway when the traffic is too dense, the system cannot cope and there is a healthy debate going on between ORR and Network Rail about this. Passengers demand more trains for their money and want them to be reliable. This is a trade off between many competing factors including allowing track closures for maintenance.
Devolution has led to Scotland and Wales having a large say in their rail systems. They may decide not to increase fares by the 4.1% as with Transport Authorities like Merseyrail who also set their own fares. Transport for London is about to take over around 20 more stations on the Liverpool Street to Enfield Town, Cheshunt and Chingford and add them to their London Overground services. How this will affect fare levels is anyone’s guess at the moment but does possibly create another fares anomaly for passengers.
Many southern commuters consider that they face huge increases as they are a captive market and will see no tangible benefit and adding to their annoyance could well be subsidising other passengers in other areas of the UK. Those regional passengers would contend that London commuters earn more than in the regions so can afford these annual increases. But obviously rural routes such as in Wales, Scotland and Cumbria will always require a huge subsidy or face closure. The subsidy has to come from somewhere, perhaps where there is a more captive affluent market.
But whatever the cause of the increases, and whatever it pays for and whoever pays it, railways and politics have been inexorably entwined since the first railways 200 years ago. This will never change and for example, Oxford MP Nicola Blackwood has been reported as calling for more rail investment.
She is perhaps ignoring the fact that Oxford will be linked with Bedford, Milton Keynes, Princes Risborough and High Wycombe in the next few years with a new interchange parkway station at Water Eaton, just outside Oxford. Chiltern Railways and the DfT are radically upgrading existing lines and opening others at huge cost and these will bring measurable benefits to rail passengers and road users in that busy congested area.