The Great British Rip-Off: Why the Williams-Shapps Plan will fail to deliver

Despite four years work on the Williams-Shapps Plan, the government has failed to come up with any credible answers for the complete market failure of the railway.

Its promise that Great British Railways (GBR) will be an integrated guiding mind “maximising social and economic value in the public interest” is fundamentally unachievable while privatisation remains in place.

Grant Shapps knows this. That’s why he’s deciding the future of essential passenger services such as fares, ticketing, staffing and station management in backroom talks with private train companies; exempting these areas from consultation. Meanwhile, the Williams-Shapps Plan offers a set of incoherent legislative proposals, which fail to clarify which essential services will be run by GBR; and which will remain in the hands of train companies.

The Williams-Shapps Plan for Rail consultation is clear about just one thing – the reasons for market failure. In the government’s own terms, this has been caused by: 1. Moral Hazard – where profit motivations conflict with the public interest, also known as “perverse incentives”; and 2. Information Failure – where inferior decisions are made due to fragmentation and lack of accountability.

However, both of these problems are certain to remain. Here’s why the Williams-Shapps Plan will fail to deliver:

1. Competition law prevents integration

While rail privatisation remains, the restrictions of competition law will permanently prevent the integration of cross-industry functions such as timetabling, ticketing and passenger data. Competition law also requires a ‘level playing field’, meaning that decisions must not cause an adverse financial impact to private train companies.

The Williams-Shapps plan has failed to find a solution for ‘track access’, the process by which train companies negotiate their use of the timetable. The government has suggested a slightly heavier weighting on public interest factors when timetabling, but this suggestion is likely to be impossible under competition law. Integration will be impossible, with timetabling dominated by private interests, thus minimising the influence of devolved and regional governments.

As the ORR has emphasised in its new consultation response, the government’s proposals actually unleash even more competition concerns, likely to conflict with multiple existing regulations. It even suggests that GBR might have to be split into two distinct parts – to avoid the possibility of breaching competition law by collaborating across retail and operations within itself.

2. Incoherent legislation will prevent reform

Given the undisputable fact that privatisation leads to market failure, the government wants to amend the Railways Act 1993 to make it easier for ‘direct awards’ to publicly-owned operators when private companies fail. However, it wants publicly-owned operators to remain banned from actually competing for contracts because the better value they provide is seen as an ‘unfair advantage’ over private train companies.

The government also wants to retain EU Regulation 1370/2007; making it easier to navigate issues around state aid. These changes are welcome and could greatly increase the ability of local and national governments to directly award contracts to publicly owned companies. However, this approach is logically in conflict with the Bus Services Act 2017, which bans municipal ownership and severely limits the powers of local authorities to regulate their buses. Unless these changes are taken together holistically, it will be impossible to achieve integrated, multi-modal travel across bus and rail.

Finally, the government wants to sign up to the Luxembourg Rail Protocol; a way of liberalising and globalising the Rolling Stock Companies (ROSCOs), making it easier for the big banks to get involved. However, the leasing of trains under the ROSCO system is already one of the most dysfunctional areas of the railway; as well as the biggest site of profit leakage.

3. Accessibility proposals will fail to deliver

According to the submission made by the Disabled Persons Transport Advisory Committee (DPTAC), the government’s proposals will be “insufficient to achieve real cultural change.” The government had previously ignored DPTAC’s recommendation for a £6 billion investment for full station accessibility by 2060, offering just a ‘nationwide station audit’ instead.

Last week, we published a confidential DPTAC report that suggests investment in station accessibility is being jeopardised by the “perverse incentives” of train operators. It is important to note that publicly-owned operators such as LNER are directly subject to the public sector equality duty, whereas private operators are not.

One positive suggestion in the Williams-Shapps plan is to expand the role of DPTAC, which has proved itself to be a competent and independent advisor to the government; never failing to oppose “toxic” and “illegal” policies of railway destaffing. However, there is now an urgent need to ensure DPTAC is sufficiently resourced to guarantee its independence, and has clear guidelines around its publishing and transparency policies. This is the only way to avoid the potential for political interference – especially in relation to the controversy around railway destaffing.

4. Passenger representation – a new role for Transport Focus

The Williams-Shapps Plan suggests that all passenger representation should be conducted by Transport Focus, part of a planned expansion of the organisation. Though it is an excellent research organisation, Transport Focus does not have the independence or credibility required to perform the function of a “passenger champion”; especially as relates to its new role representing disabled passengers. The inflation of Transport Focus to perform all of these vital roles appears to be a quick and cheap way to tick the ‘passenger rights’ boxes without any real consideration of what it would take to gain passengers’ trust and actual representation within the railway.

We Own It and Bring Back British Rail have published an excellent guide to the consultation, which calls for a ‘passenger board’ including representatives from every region of the country, as well as rail workers. Such a model is common in Europe and would greatly increase passenger involvement and trust.

How to respond to the consultation

The Williams-Shapps Plan for Rail consultation closes at midnight tonight, and we urgently need your help. The online response form is complicated, but the information in this blog, plus this excellent guide from We Own It, should help you to demand public ownership with just 15 minutes of your time.

Despite four years work on ‘reinventing the wheel’ of railway privatisation, the government has: 1. Failed to consider public ownership and 2. Failed to provide any proper economic analysis or predictions in support of its plans.

It’s vital to demand that legislative changes work holistically, creating the conditions necessary to “maximise social and economic value” – only possible under public ownership. However, legislative changes alone will not be enough. We’re also demanding a new ‘public sector value test’ to enshrine the benefits of: economic and social value, levelling-up, equality, decarbonisation and modal shift as determining factors in all government contracting decisions. These aims should never be compromised by competition law, especially the duty to avoid ‘financial impact’ on operators.

Any private train companies continuing to operate on the British railway must at minimum be treated as public sector bodies, and made subject to the Freedom of Information Act and the public sector equality duty – as the publicly-owned operators are already.

For more information: contact@abcommuters.com

EXCLUSIVE: ‘Rail Workforce Reform Case Study’ proves economic value of railway staffing

A groundbreaking new report on ‘Rail Workforce Reform’ has concluded that inadequate railway staffing is undermining the value of billions of public investments. It also finds that destaffing policies are creating “perverse incentives” for train operators; jeopardising further investment in station accessibility and step-free access.

The confidential report was drafted in February 2022 by the Disabled Persons Transport Advisory Committee (DPTAC): statutory advisors on accessibility to the Department for Transport (DfT). DPTAC has been warning the government about the “toxic combination of driver-only operation and unstaffed stations” since 2016; insisting that railway destaffing breaches multiple areas of equality law.

DPTAC’s new report uses the ‘Sutton loop’ in South London as a case study to “provide real-world examples of the consequences of policy options” as well as analysing the “current and future impact of staff roles and availability”. Its groundbreaking conclusions on financial impact represent a whole new economic argument for the full staffing of Britain’s railways.

“The toxic combination of driver-only operation and unstaffed stations”

The “Rail Workforce Reform Case Study – Sutton Loop” assessed 20 stations served by the Thameslink (GTR) service from London Blackfriars to Sutton. 11 of these stations also have regular services on other routes, provided by Southern (GTR), South Western and Southeastern. Except for South Western, all services are driver-only operated, so boarding assistance is entirely dependent on station-based staff. The report concludes that:

“Assistance and/or auxiliary aids cannot routinely be provided at all times trains are running, at 14 of 20 stations on the Study Route, even if requested in advance – and certainly not on a ‘turn up and go’ basis…. It is clear that the current staffing levels on this route are completely inadequate to deliver an accessible railway, and to ensure disabled people can use train services on the same terms as other passengers….As things stand, the toxic combination of Driver Only Operated (DOO) trains and unstaffed stations means many disabled people are excluded from using the route to access employment, services, leisure and health facilities.”

Of the 20 stations on the Study Route, 10 have no step-free access from street to platform; and only 5 have step-free access to modern standards (consistent with the national situation.) Only London Blackfriars has level access between the train and platform, so wheelchair users rely on a staff member for boarding assistance at every other station on the route. DPTAC concludes that:

“The ability of staff to provide assistance is the only effective way of mitigating the continued partial physical inaccessibility of many of the stations on the loop, which will take many years to address fully. However, the toxic combination of inadequate station staffing and Driver Only Operated trains in particular, undermines the ability of staff to mitigate physical inaccessibility on a reliable basis, and leads directly to the exclusion of disabled people from the Study Route.”

Railway destaffing undermines the value of investments

The Sutton Loop is part of the Thameslink network, which has received over £6 billion in public investment since 2009, as part of the ‘Thameslink Programme.’ This includes a fleet of modern, accessible Class 700 trains; and platform-train level access at London Blackfriars and St. Pancras. DPTAC argues that railway destaffing has devalued these accessibility investments: as well as over a hundred million invested in 30 other stations directly served by the Study Route stations; and indirect implications for multi-billion investments on the wider network.

“A current lack of adequate staffing renders much of the Study Route inaccessible to many disabled people for much of the time, significantly undermining the investment in accessibility already made, depriving rail of an important market, and perpetuating the exclusion of many disabled people from a vital public service to the detriment of both their lives and the wider economy.

It is impossible to divorce consideration of operating costs from the return on investment in station infrastructure…any reduction in staffing then has the potential to undermine the business case for future investment in accessible facilities, where these are dependent on staff presence – as by definition their benefit reduces as staffing reduces. It may also undermine the willingness of rail management to seek accessibility improvements.”

DPTAC suggests that further investment in station accessibilty is already being jeopardised due to this conflict of interest; recommending that the short to medium term priority is to ensure there are no “perverse incentives” for train operators that would discourage the development of step-free access schemes.

DPTAC’s recommendations:

DPTAC’s “Rail Workforce Reform Case Study” concludes that:

“The benefits of staff presence are widespread and include not only the provision of assistance, but e.g.: personal security reassurance; ensuring toilets and waiting rooms are available; provision of information; and management of disruption etc. Poor staffing levels are likely to suppress demand at a time when the success of the rail nework depends on attracting more customers.

“Any reductions in current staffing levels will result in the Study Route becoming even less accessible with both direct (e.g. the provision of assistance) and indirect (e.g. the opening times of waiting rooms) impacts on accessibility.

“Such reductions in accessibilty will undermine (and in some cases virtually eliminate) the benefit of both previous and potential future investment in the physical accessibility of stations and rail vehicles, and of connecting accessible transport modes…Until radical improvements in physical accessibility can be implemented, staff will remain the key way of ensuring that accessibility is maximised.”

The Rail Workforce Reform Case Study was released to us via a Freedom of Information request. For more information: contact@abcommuters.com

The Great British Cover-Up: What Grant Shapps is hiding about the future of the railways

While everyone’s talking about the Tory leadership contest and RMT industrial action, we’re about to lose our last chance to save Britain’s railway from its most dangerous privatisation project yet.

A government consultation on the new public body Great British Railways– including major changes to legislation – is about to be rushed through without any public awareness. It’s a key part of the government’s secret plan to cut billions in public spending, including a massive destaffing project allegedly involving the closure of every ticket office in England.

Today, we’ve demanded that Grant Shapps extends the 4th August deadline and starts publicly promoting the consultation – in a joint letter with campaign group Bring Back British Rail. The consultation is far too short for a holiday period and has been completely hidden from view by the “National Headquarters Competition for GBR”. If he refuses, the Williams-Shapps Plan will lose even more credibility with the public.

However, this is only the first of the weaknesses in the consultation. The private rail industry has been in backroom talks with the government for months; making vital decisions on all the most important areas affecting passengers.  Most of these areas – such as timetabling, fares, and accessibility – have been exempted from the consultation (2.14) and are being negotiated as part of a market engagement process with train companies. They are now set to be decided without any public input whatsoever.

Screenshot of a Sunday Times headline: Secret plan to close all railway ticket offices as strikes grip Britain
This Sunday Times article was deleted after it went viral. View the archived version here.

Great British Railways and the public-private power struggle:

Beginning in 2018, the purpose of the Williams-Shapps review was to fix the fragmentation that caused the nationwide timetable collapse of that year. The process has concluded that the railway experienced complete market failure; caused by the perverse incentives of private companies within the system.

Consequently, the main commitment of the 2021 Williams-Shapps White Paper was to bring all “critical cross-industry functions” under a new public body, Great British Railways, including: timetable planning, fares and ticketing, open data, and station management. This commitment requires the removal of the operational role of the Rail Delivery Group, which currently controls the National Rail Enquiries ticketing system and many other cross-industry functions – as well as acting as a powerful trade association for private companies.

In October 2021, a secret market engagement process began, to decide the details of the new style of GBR contract – Passenger Service Contracts (PSCs). The Rail Delivery Group simultaneously published their own report on behalf of the private train companies; demanding that GBR should be scaled down to set only “base level requirements” and that train operators should retain most of their critical cross-industry functions, including: “active or leading roles in all three phases of the timetable specification;” key roles in marketing and ticket retailing; maximum autonomy over fare pricing; and the commercial and operational management of stations.

Essential passenger services are now under greater threat than ever, and all the details of these policies have been hidden from public view.

  1. Fare Reform

There has been no proper consultation on rail fare reform for Great British Railways. A major ‘Pay As You Go’ smart-ticketing consultation was held in 2019, but this never reported to the public. Nor was there any consultation behind Great British Railway’s first policy rollout – ‘flexi-tickets’, launched in June 2021. The Department for Transport even ignored their own focus group research, which shows a strongly adverse reaction to the flexi policy they eventually chose – giving just a 5% discount on the price of a daily ticket.

A ‘formal one-year review’ of the flexi-ticket scheme is currently underway, but this is being hidden from the public due to train companies’ demands for commercial confidentiality. For the same reason, the Rail Delivery Group refuses to release any flexi-ticket sales data, despite the scheme being a government policy and fully funded by the taxpayer.

Most shockingly of all, the Rail Delivery Group has been put in charge of implementing a whole new smart ticketing system on behalf of Great British Railways.

2. Accessibility

Disabled people’s equal right to travel has been under threat for years, due to a compromised relationship between government and industry in which they have secretly developed long-term destaffing programs – previously revealed by whistleblowers on this website. The plan to close every ticket office in England is the latest example of this cover-up.

The Williams-Shapps Plan’s proposals for accessibility have never been consulted on, and essential advice from the government’s accessibility advisors has been ignored. The National Disability Strategy was recently declared unlawful by the high court for its failure to properly consult, and it seems that many of the same weaknesses are now being repeated in the Williams-Shapps consultation.

3. Workers’ rights

Currently, Grant Shapps refuses to step in on the strikes, and the blame for the industrial relations crisis has landed on the government. But this does not mean that the private rail industry is any more sympathetic. As reported in The Times, the industry is pushing for ‘minimum service levels’ legislation; which would virtually end the effectiveness of industrial action and trade union negotiating power.

In its lobbying on Passenger Services Contracts, the Rail Delivery Group has said that the industry wants more control over stations, and the development of automation technologies.  One of their central demands is for the new contracts to directly incentivise them to cut costs – which will ensure permanent conflict in industrial relations, with the government continuing to negotiate by proxy.

What happens next?

We are still only scratching the surface of the ‘Great British Cover-Up’ and the Williams-Shapps Plan for Rail consultation. The Department for Transport has refused to comment.

It’s vital that we get Grant Shapps to agree to an extension within the next few days, so that passengers, campaigners and trade unions can prepare their responses. Please join us by writing to him at shappsg@parliament.uk

The private rail industry’s ‘perverse incentives’ have stood in the way of passengers’ rights for much too long. We are now gathering evidence of the industry’s many conflicts of interest, to show that this is the true cause of the crisis in passenger trust – as well as the failure to modernise.

For more information, or to share your comments: contact@abcommuters.com

[This page was updated on 03/08/2022 to better reflect changes to the consultation principles in 2018]

EXCLUSIVE: Freedom of Information requests reveal flexi-ticket failure

On the day of the biggest rail fare increase in a decade, we exclusively reveal the first-ever proof of the astonishing failure of ‘flexi-tickets’.

The main document is the Department for Transport’s impact analysis, dated November 2021, which uses ticket sales data to predict the impact of flexi-tickets. It shows that they are expected to result in just 1.1 million additional journeys in the first year – a 0.5% increase in commuter journeys. The document also reveals the shockingly low government investment behind the scheme, which has been designed to achieve ‘revenue neutrality’ at a mere 1% increase in commuter journeys. At a time when commuter numbers are at around 50% of pre-pandemic levels, this is the clearest proof yet of the lack of aspiration behind the policy.

The document also reveals the true pricing model behind flexi-tickets. The level of discount is around 20% off a monthly season ticket and a working level of 5% off the price of an Anytime Day Return (the highest priced daily ticket). This model fits our prediction since their launch in June last year; that flexi-tickets are a manipulative pricing strategy designed to ‘upsell’ passengers back to traditional season tickets. Flexi-tickets are a high risk purchase with no system of price capping – passengers can end up spending hundreds more than they would have done if they had bought a season ticket.

However, commuters should not lose hope – there is still a chance to get a better deal. The DfT has revealed to us that flexi-tickets are under a ‘formal one year review’, and it’s clear that they expect to update the policy in June 2022. For more information see their responses to our FOI request and Internal Review.

More buried documents on the flexi-ticket scandal

  • The DfT’s impact analysis came heavily redacted, and we suspect it contains further evidence of our claim that flexi-tickets are designed to have an ‘upsell’ effect. We are now challenging their redactions with the Information Commissioner’s Office (ICO).
  • There are several other important documents that the DfT is refusing to release. Of most concern is the Equality Impact Assessment, which they claim is still part of ‘live policy’. This excuse is completely inadequate when flexi-tickets have in fact already been launched, and are already pricing part-time workers even further off the railway. There are huge equality implications for women and other lower income groups, who are significantly over-represented in the part-time demographic.
  • We’ve learned that extensive ‘quantitative and qualitative’ research was conducted prior to the launch of flexi-tickets. The DfT has refused to release these reports, and claims that they will be published at the end of February 2022.
  • Flexi-ticket sales are run through the Rail Delivery Group, which claims ‘commercial confidentiality’ on behalf of their private train company members. It is therefore impossible to access the sales data; despite this being a government policy, where all costs and revenue lie with the taxpayer.

Take action on the flexi-ticket ‘One Year Review’

  • The outrage over flexi-tickets will continue to grow as people return to the office. Passengers, campaigners, trade unions and employers should keep up the pressure from now until June; when they stand a good chance of affecting the policy.
  • Commuters from our online community recently spoke out in the Financial Times as part of an in-depth report including new research on the poor value of flexi-tickets. To join our Facebook group and discuss these issues further, click here.

[This article was edited on 01.03.2022. for clarity around the meaning of the figures involved]

Major class action lawsuit to go forward against Southeastern and South Western rail franchises

A £93 million class action lawsuit against the Southeastern and South Western rail franchises will proceed to trial at the Competition Appeal Tribunal. The long-awaited permission for the ‘boundary fares’ case was granted on Tuesday, and it’s likely to lead to further lawsuits against the railway’s complex fares system.

The ‘Boundary Fares’ Case

The claim relates to an alleged ‘abuse of market dominance’ by Southeastern and South Western, in failing to make cheaper ‘boundary fares’ available to London Travelcard holders. It argues that the train operators have been overcharging passengers who travel outside the Zone 6 boundary; effectively charging double for the portion of the journey already covered by their Travelcard. The claim for damages goes back to 2015 and includes: The Go-Ahead Group/Keolis (Southeastern); First/MTR (South Western Railway); and Stagecoach (South West Trains).

Claimant Justin Gutmann and his legal team have waited over two and a half years for the ‘Collective Proceedings Order’ (CPO), after a similar case against Mastercard caused long delays to the process. The Merricks vs Mastercard case was granted a CPO in August, making it the first ever US-style class action lawsuit to go forward in the UK – and clearing the way for a much faster process in future.

The ‘boundary fares’ class action has long been considered to be a test case for consumer rights on the railway, and the CPO announcement is sure to send shockwaves throughout the industry. Though this particular case is confined to the Southeastern and South Western rail franchises, the issue of ‘boundary fares’ relates to multiple train operating companies running out of London; presenting a further risk of litigation in this area alone.

The Govia Thameslink Railway Case

The new legal cases are ‘opt-out’ class actions, first made possible in the UK by the Consumer Rights Act 2015. Previously, such cases took place on an ‘opt-in’ basis, requiring the sign up of a group of claimants. Now, it’s possible to undertake an action on behalf of a prospective class, where passengers will be included by default and entitled to compensation if the case is successful.

A second rail fare lawsuit of this kind was launched in July against Govia Thameslink Railway and is now awaiting the Competition Appeal Tribunal’s decision on whether to grant a CPO. GTR is the only train company in the UK to have ‘sub brands’ within the same company, and the case alleges that it has used Southern Rail, Gatwick Express and Thameslink to ‘unlawfully’ control ticket options on the Brighton main line.

GTR recently commented on the claim:

“We dispute the allegation that we have breached competition law, and do not believe the claim should be allowed to proceed. We work in a highly regulated industry and fully comply with the terms of our franchise agreement with the Department for Transport. We will make our submissions to the tribunal in due course.”

Their statement raises wider questions about the government’s responsibility in these cases. For example; if GTR were only ‘complying with the terms of their franchise agreement’, could the taxpayer be left on the hook for potential damages?

Government failure on rail fare reform

The government’s promises on rail fare reform go back seven years, and yet they have repeatedly failed to fix our broken system. Initially, they delegated the task to the Rail Delivery Group (Association of Train Operating Companies Ltd.), who were supposed to reform Britain’s notoriously complex rail fare system while keeping it ‘revenue neutral’. After this attempt failed, further promises were made by the ‘Williams Rail Review’; which has yet to produce any detail on fare reform, despite being underway for three years already.

Serious questions must be raised about the government’s failure to act on fare reform, and to what extent they might have exposed the taxpayer to liability. Legal commentators note that the new class action regime is ‘potentially franchise-ending territory’ – but who will be footing the bill? And how much will this new legal pressure add to the contractual risks around covid ‘emergency contracts’ – as highlighted in a recent report by the Public Accounts Committee?

Most importantly of all, when will passengers finally get the simple, fair and affordable ticketing system they deserve? The controversy around ‘boundary fares’ and GTR ‘sub brands’ will come as no surprise to commuters on these services, many of whom have been complaining about these issues for years. It should not take class action lawsuits to finally put them under the spotlight.

Further Information

Boundary Fares:

  • Justin Gutmann v London & South Eastern Railway LimitedCase history including CPO Judgement (19/10/2021)
  • Justin Gutmann v First MTR South Western Trains Limited and AnotherCase history including CPO Judgement (19/10/2021)

Govia Thameslink Railway:

  • David Courtney Boyle & Edward John Vermeer v Govia Thameslink Railway Limited & OthersApplication for Collective Proceedings Order, 27/07/2021

REVEALED: The economic dangers of the National Bus Strategy

As Parliament comes back into session, there is an urgent need to raise the alarm on the National Bus Strategy. As further detail has emerged this summer, it is clear that the Strategy is in fact an accelerated program of ‘Enhanced Partnerships’ – the purpose of which is to revive the failed policy of bus deregulation. Nearly every local authority in England has now been coerced into starting this path, by the threat of losing access to all future bus funding.

In July, the National Bus Strategy became a source of international controversy when the former UN Rapporteur for Poverty, Philip Alston, accused the UK government of ‘doubling down’ on its ‘extreme form of bus privatisation’, despite already being in breach of multiple human rights obligations. He also raised serious doubts whether the Strategy has any cost-benefit analysis or evidence-based policy behind it. Our investigation now confirms his suspicions that the government has no economic case to offer.

No economic case for the National Bus Strategy

In a recent FOI response, the Department for Transport confirmed to us that they have not conducted any cost-benefit analyses or demand forecasts comparing deregulation with Enhanced Partnerships, franchising and municipal ownership; except for an extremely limited and outdated 2017 study. This is further confirmed by the Department for Transport’s new ‘areas of research’ corporate report, which includes at least a dozen questions relating to unresolved issues in the National Bus Strategy; strongly emphasising the need for economic research, as well as private vs. public operation and the barriers for devolved transport policy. Indeed, the National Bus Strategy itself points out multiple areas requiring further policy work, including the ban on municipal ownership, which it says is ‘ripe for review.’

The truth is that the public control of buses was never intended to be a realistic option for local authorities. Despite promising to update ‘incompatible’ 2017 guidance on Enhanced Partnerships and franchising in Spring, the government failed to meet this commitment in time for the initial deadline of June 30th. This means that nearly every local authority has now been coerced into making a statutory declaration towards an Enhanced Partnership (EP), without the facts in front of them. To add insult to injury, the EP guidance was updated just one day after the deadline, and the guidance for franchising remains to be updated.

‘Bus Service Improvement Plans’ are a public investment giveaway to bus companies

The second stage of the Strategy is now underway and local authorities must complete a ‘Bus Service Improvement Plan’ (BSIP) by October 31st to remain eligible for funding. BSIPs are ‘joint funding proposals’ between councils and bus operators, due to be judged by criteria that revolves almost entirely around short-term measures. As this is an extra, non-statutory stage to the Enhanced Partnership, public consultation is strongly discouraged, despite the fact that BSIP content is expected to be almost fully replicated in the form of an ‘EP Plan’.

The primary condition of BSIP funding is for councils to commit to ambitious public investments – especially an increase in bus priority – while bus companies are encouraged to form a ‘collective joint position’ and a ‘shopping list’ of demands from the earliest possible stage. Invitations for ‘reciprocal investment’ are to be ‘heavily weighted’ towards what local authorities can provide, to allow for the commercial uncertainty felt by bus operators as they emerge from the pandemic. Only minor improvements are expected from bus operators in return, as competition law prevents councils from imposing anything but ‘indispensable’ restrictions on the deregulated market. The ability for councils to cross-subsidise services, set prices or generally lower fares will also be banned by law.

Under these circumstances, the level of profit leakage from public investments has now reached a greater level than ever before. For example, Greater Manchester’s 2019 case for franchising found that it offered almost three times the economic value of the bus companies’ partnership proposal. Under the funding conditions and strict deadlines imposed by the National Bus Strategy, we can expect the disparity to be even greater.  In addition to the £3 billion pledged for bus services, this will have a knock on effect on all public transport, cycling, and walking schemes – preventing the ability to make an integrated plan, or optimise the value of investments.

Urgent action required within the next two months

Having failed to offer any economic case for Enhanced Partnerships, the government’s only justification is that the process is quicker than public control (franchising). However, it is their own legislation that makes the franchising process so difficult, and there is now a near-unanimous consensus that the Bus Services Act (2017) is inadequate to the task. This includes a wide range of respected organisations, including NYU Law School, Centre for Cities, the CPRE, the Transport Select Committee, and even the National Audit Office.

The ultimate solution is for the government to pause the National Bus Strategy and urgently review the legislation behind it, including the ban on municipal ownership. The economic dangers of continuing with bus deregulation are in no doubt, and there is an urgent need for Parliamentary intervention before the BSIP deadline of October 31st. If the Enhanced Partnership program goes forward next April, councils will be locked into bus deregulation for the long-term.

However, this should not let councils off the hook. There are just two months left to complete the BSIP process and it is absolutely vital that they resist pressure from bus companies and create ambitions that can be shown to bring long-term economic value to their communities. Due to the ban on cross-subsidy under deregulation, this will only be possible under public control or ownership (estimated to bring back £340 million or £503 million per year to the British taxpayer, respectively.)

In turn, the government must come through on its promises to update and strengthen the franchising process. Currently, only mayoral combined authorities even have access to the powers to franchise their buses. However, the government has committed to supporting access to these powers ‘for local authorities with the capacity and intention to use them’ and it’s now a priority to call them in on that promise.

In both the BSIP and EP guidance, the government has advised councils to limit the length and scope of public consultation as much as possible. Since the next two months will be crucial to negotiations, local campaigners should do all they can to raise fundamental issues and long-term objectives in relation to bus services. This means putting long-term social, economic and climate justice at the top of the agenda, and demanding that councils incorporate these goals.

References:

-NYU School of Law (2021) Public Transport, Private Profit

-Centre for Cities (2021) Get on board: bus franchising

-CPRE, the countryside charity (2021) Every village, every hour

-Transport Select Committee (2019) Bus services in England

-National Audit Office (2020) Improving local bus services in England

-Transport for Quality of Life (2015) Building a World Class Bus System

This article was edited on 09/09/2021 to include a link to the Bus Services Bill: Impact Assessments (2017). This is the only cost-benefit analysis conducted by the Department for Transport, comparing franchising and enhanced partnerships.

The ‘Great British Rip-Off’ – why new ‘flexi-tickets’ are an insult to passengers

The Department for Transport’s new ‘flexible season tickets’ are an absolute insult to passengers. Neither cheap nor flexible, they are just another pricing trap for a captive commuter market – and in some cases, could see passengers paying even more.

The ‘flexi-tickets’ exclude London travelcard, Merseyrail, and journeys within Wales and Scotland (including all cross-border journeys originating outside England). Hardly the integrated and comprehensive new ticketing system we’ve been promised. As the first significant policy rolled out from the Williams Rail Review, it’s a really bad sign of what’s yet to come from ‘Great British Railways’.

Bulk buy tickets with highly variable discounts

The new ‘flexi-tickets’ are packs of eight ‘one-day season tickets’ for use within a 28 day period (excluding free weekend travel). The discounts when compared to the price of an Anytime Day icket are highly variable across the cuntry – so far, we’ve spotted examples ranging from 7% to 15%, and we think there could be many more surprises to come.

Because the new system replaces existing carnet tickets, this may even lead to price rises for some commuters. Ironically, Grant Shapp’s own constituency of Welwyn Garden City is one of these anomalies, where commuters will see an 18.5% rise on carnet tickets under the new system. Previously, there was no evening peak on that line, so a carnet ticket came in at £14.80 per day – under the new system of ‘flexi tickets’ this has risen to £17.55 per day

A rigid and inflexible ticketing system

In many of the cases we’ve seen the new flexi-ticket only makes financial sense if you know for sure you are going to travel two days a week (or eight journeys per month). Three-day per week commuters are likely to be better off on a weekly or monthly season ticket. And even two-day per week commuters would only need a couple of extra trips for a monthly season ticket to have been more cost-effective. Whereas we’ve spotted a few examples of local journeys where flexi-tickets are cheaper for three days per week, the discount level seems to get radically worse the longer the commute.

This is a rigid, bulk buy form of ticketing with no price-capping that will actually disincentivise additional rail travel for those who use it. And let’s not forget, if you choose the ‘flexi-ticket’, you’re missing out on free weekend travel too.

Here’s how the price trap works:

A £45.23 Brighton to London Victoria flexi-ticket provides a 20% discount on the anytime return of £56.40. At three days per week the daily cost becomes £39.27 on a weekly season ticket, £34.83 on a monthly, and £30.23 on an annual.

From Reading to London terminals, the £43.90 per trip flexi-ticket provides a 12.5% discount on the £50.20 anytime return. At three days per week the daily cost on a weekly season ticket is £40.53 per trip, on a monthly £35.92 and on an annual £30.23.

In conclusion…

The so-called ‘flexi season tickets’ are little more than a PR stunt from the government and rail industry. Neither cheap nor flexible, they are just another pricing trap for the captive commuter market – probably designed to ‘upsell’ passengers back to traditional season tickets.

It’s no wonder then that the government is being so obscure about the exact level of discount involved in the flexi-season tickets, attempting to claim “20% off a monthly season ticket” as their comparator and neglecting to mention that this applies only in the most rigid of circumstances for two day per week commuters.

There’s now increasing suspicion that many passengers will be paying even more under this new system. No doubt further pricing anomalies will emerge as commuters flock to National Rail Enquiries to figure out the value of a flexi-ticket for their area.

At a time of recovery from covid, commuters need more convenience and flexibility than ever as workers and businesses figure out what’s right for them. The new so-called ‘flexi-tickets’ are only going to impede this process, and may even discourage people from returning to rail at all.

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Grant Shapps and the Season Ticket Refund Rip-Off

In a significant victory for our campaign, the Chair of the Transport Select Committee, Huw Merriman, has publicly supported our demand for pro-rata refunds on season tickets. In an interview with BBC South East, he called the current arrangements a “rip-off” and said he would be calling on the government and rail industry to give full refunds.

We welcome Huw Merriman’s statement and call on the Transport Minister Grant Shapps to act decisively and follow through on his promise to ensure that “no-one is unfairly out of pocket for doing the right thing.”

[Update: on 24th April, the Chair of the Transport Select Committee wrote to Grant Shapps urging him to ensure: 1. pro-rata refunds 2. the option of a ticket suspension and 3. a waiving of the £10 admin fee. A response is due on 30th April.]

Mixed messages from the government on season tickets:

Since the lockdown began, the government and rail industry have changed the refund arrangements several times, leading to widespread confusion among passengers. On 25th March, Grant Shapps assured the Transport Select Committee that he had arranged pro-rata refunds. In fact, the rail industry’s unfair refund system remains in place – and commuters have been losing out on hundreds of pounds.

shapps tweetThe Season Ticket Refund Rip-Off:

The government is bailing out train companies to the tune of £600 million per month. And yet, the rail industry has so far refused to give pro-rata refunds on season tickets; instead relying on a vastly unfair refund system. The whole process is shrouded in mystery for passengers, so we created a graph to show exactly how much people could be losing:

season ticket graph

The graph shows that the less time you had left on your season ticket at the time of the lockdown, the more value you’d lose. In this example, a Brighton to London commuter who had held their annual for 1 month would lose £83 compared to pro-rata. After 3 months, they’d lose £370; after 6 months they’d lose £744; and after 9 months, £1,118.

We’re demanding full refunds for all passengers:

It’s clear from our recent discussion on BBC Radio Four’s ‘You And Yours’ program that the rail industry will not budge on this issue – refusing to give pro-rata refunds OR the option of a season ticket suspension. But, under new corona virus legislation, the Transport Minister Grant Shapps is now in full control of the railways – and he has already promised pro-rata refunds. So, why won’t the train companies do what Grant Shapps told them to do? And who is really in charge here?

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Better Buses in Greater Manchester could help us fight injustice across the UK

The Greater Manchester bus consultation closes at midnight tonight, and we’re calling on friends and allies all over the country to join us in writing in before the deadline to urge Andy Burnham to re-regulate the city’s buses.

The consultation is open to those who visit the city as well as residents of GM, so if you care about Greater Manchester as much as we do, please join us in dropping a few lines ASAP: gmbusconsultation@ipsos-mori.com

The Fight for Greater Manchester’s Buses

In Spring 2019, we made a documentary about Better Buses for Greater Manchester, the campaign at the centre of a coalition of transport, anti-poverty and environmental activists calling for bus regulation in the city. In the process, we spoke to a range of passengers and campaigners, who argued that Manchester would benefit from a London-style bus system, including multi-modal ticketing and more local power and accountability over transport. Check out our 14-minute documentary for all the benefits bus regulation would bring, or read more on Better Buses for GM’s website.

Is the government’s bus legislation strong enough?

If Andy Burnham goes ahead with the decision to re-regulate, he will be the first Mayor to do so under powers in the 2017 Bus Services Act. But even getting this far into the process has been done with great difficulty and cost to the Greater Manchester Combined Authority. So, why is the process so complex?

Currently, only the elected Mayors of Combined Authorities have the powers to regulate buses, and to do so they have to get through a process that includes a series of business cases, consultation with bus operators, an auditor’s report and, finally, a public consultation. For local authorities outside these areas, the path to bus franchising is even more complex and they must submit extensive reports and proposals to the Department for Transport before they can even access these powers. You can read more about the legal process here.

Local authorities need MUCH more power & resources

Buses are the most popular form of public transport, used by 59% of all passengers. They are also the passengers most severely affected by regional inequalities; through the combination of ten years of austerity and a completely deregulated bus market. Yet bus fares are rising at a faster rate than rail fares, and over 3,000 routes have been cut in the UK since 2010. The situation is so bad in rural areas especially that the deregulated bus market was directly called out in the UN report on poverty last year, arguing that “abandoning people to the private market is incompatible with human rights requirements.”

After a staggering 45% cut in their funding over the last ten years, it is therefore unrealistic and actually irresponsible of the government to expect local authorities – especially those outside the big metro areas – to undertake the difficult and expensive process required to introduce bus regulation in their areas. The social, regional, and environmental need for action is obvious and urgent, but the simple fact is that current legislation isn’t strong enough to be of any significant use in changing the power balance that lies between passengers and major international transport corporations.

Bus passengers urgently need a seat at the table

Bus passengers have been the hardest-hit by austerity and change cannot come quickly enough. But there is little chance of that under the government’s current legislation. Local authorities need much more power and resources to even have a chance of beginning the process, and it shouldn’t be left to bus passengers to raise that demand. Our view is that the Bus Services Act 2017 has failed to achieve what the government promised it would, and that the most important priority for all bus passengers right now is to come together on a national level and demand further powers and resources for local authorities.

Private transport companies should have no right to fill our public space with political messages, as happened earlier this year when Stagecoach ran adverts against regulation on the side of their buses in Manchester. Though early threats of legal action from Stagecoach over bus franchising seemed to pass, the anxiety among campaigners and local authorities is very real and we’ve noticed it throughout years of talking to passengers all over the country. It is now a matter of public interest that the private transport companies are brought in line across both rail and bus services, as there is no hope of seeing an integrated transport system without this.

We note that bus companies have already created obstacles to Transport for the North’s plans for smart-ticketing, as reported by the Yorkshire Post last year. It is clearly the case that metro areas in the North will not get the multi-modal ticketing system they deserve without bus regulation. The current deregulated bus market not only disincentivises companies to collaborate, it actually prevents an Oyster-style ticketing system under competition law!

ABC’s submission to the GM bus consultation

We have sent our comments to the bus consultation, and urge you to contribute before the deadline at midnight tonight. A few lines to gmbusconsultation@ipsos-mori.com will be enough, to help make a real change that could set a precedent for bus services all over the country.

In our submission to the Greater Manchester consultation, we have strongly supported Andy Burnham’s plans for a regulated bus network, which will be the start of meaningful change to the GM economy, society and environment, through the necessary infrastructure of an integrated transport system. We have asked him to speak up for other local authorities and bus campaigners facing the same process.

The example of Greater Manchester shows how hard passengers have to work to challenge and reform this country’s failing public transport policy, where the power balance between passengers and transport companies is all wrong and absolutely riddled with private interests.

Write to us at contact@abcommuters.com

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No More Rail Reviews: It’s time to declare a National Crisis in Public Transport

At a time when rail francising is clearly collapsing, today’s 2.7% fare rise is an outrage. It’s another sign that the government and industry will continue to treat us like a captive market, meaning that we’re continually paying more while constantly receiving less. Today, we’ll be joining with passengers around the country to demand a nationwide fares freeze, in recognition of the fact that UK public transport is now at the point of social, economic, and environmental crisis.

Protests begin at London Kings Cross at 8am and you can view the full schedule here.

A National Crisis in Public Transport

For the last ten years, rail fares have been rising at twice the speed of wages. For many commuters on a lower income, this is more than just a matter of yearly injustice – they are being priced off the railway altogether.

And for bus passengers, things are even worse. Bus fares are rising at an even higher rate than rail, according to government statistics published last month – a shocking 3.3%. Unlike rail fares, bus fares outside of London are completely unregulated, meaning that bus companies can put up fares as and when they choose and do not even have to give a warning to passengers. Alongside the withdrawal of local investment and routes, this is pricing thousands of people out of bus travel, if they even have a service left at all.

Transport is the UK’s biggest polluting sector and the modal shift from car to public transport is a matter of urgency; not just for climate change but for public health, social equality and regional development.

No faith in the Williams Rail Review

The Williams Review was launched by the government soon after the timetable collapse of 2018, promising a ‘rail revolution’ and an end to the failed and fragmented franchising system. The government used this promise to evade a response to their leading role in the catastrophe; meaning that – to this day – they have not answered for the 2018 timetable crisis.

The reality of the Rail Review was nowhere near the ‘rail revolution’ promised. It had a narrow, ideological remit that excluded public ownership from the very start, and was also required to be ‘fiscally neutral’. The Rail Review that had begun by promising to ‘scrap franchising’ gradually lost all credibility as the government continued to award franchises regardless – East Midlands Trains and the West Coast Partnership.

Since the launch of the review in September 2018, Keith Williams has failed to report back. It is therefore without any public scrutiny that he approved the West Coast Partnership award to FirstGroup as ‘Williams compliant’ back in August. First Group shareholders, meanwhile, have been assured in the financial press that their future in UK rail looks more lucrative, thanks to an arrangement that protects the company from risk. The Financial Times has said that this is ‘the first time in ten years that a rail company has had financial protection.’

In a further twist to the tale, the government is being taken to court early this year over the by three different train companies over its franchising practices: Stagecoach, Virgin and Arriva. If it doesn’t go the government’s way, the cost to the taxpayer could be tens of millions – so how can we possibly trust the government to make further changes to the franchising system in the meantime?

Finally, we are extremely concerned about the excessive influence of the rail industry lobby on the outcome of the rail review. The Rail Delivery Group is calling for a mix of management contracts, concession-style models, and competitive intercity franchising, along with the proposal of an organising body resembling the ‘Strategic Rail Authority’ that was abolished in 2006. With franchising failing, it stands to reason that private train companies will be seeking to keep franchising alive, and the example of the West Coast Partnership already does not bode well for the promised ‘rail revolution’.

Passengers and taxpayers are being denied a proper, democratic conversation about the future of our public transport system, which, in the era of Brexit, is now at the point of a national emergency if we are to build the equitable country we want to see now, and in the future.

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