Rail reform must be tackled ‘ruthlessly’, says rail expert

‘Such a necessarily ruthless reform of fares is too great a change for effects to be predicted accurately’ – Mark Smith

Going places: York station (Simon Calder )

Rail fare reform is long overdue and must be tackled “ruthlessly”, says the former British Rail manager and Department for Transport (DfT) pricing specialist, Mark Smith – also known as The Man in Seat 61.

Ahead of giving evidence to a House of Lords Committee on how to update the formidably complex and irrational ticket pricing system, Mr Smith set out his prescription for action.

Fares reform, he says, must have two clear objectives. The first is to make rail easy to sell via self-service channels, including websites, apps and ticket machines – with touch-in-touch-out systems, as used in London, adopted for regular travellers across Britain.

The second objective, which he says is often underrated, is to restore consumer trust and confidence in rail pricing.

Since rail privatisation in the 1990s, countless anomalies have been “baked in” to the fares system, in a botched attempt to protect passengers against sharp price rises.

“Fares reform isn’t one thing,” says Mr Smith. “It’s a reform of the fares structure (as in Anytime, Off-Peak, Advance, monthly returns, day returns, etc) and an overhaul of pricing so that A to B plus B to C is never less than A to C.

“You could do one without the other – but I believe both are vital,” he says.

The practice of “split ticketing” – legally exploiting anomalies in the fares system to cut the cost of rail travel – has become so common that between London and Bristol it is known as the “Didcot dodge”. Passengers who split tickets – buying one to the Oxfordshire station and a second to their final destination – can almost halve the normal price, so long as the train calls at Didcot.

Mr Smith envisages “an all-one-way fares structure,” with a maximum of three fares per train: Anytime, Off-Peak and, on longer distances, a dynamically priced Advance ticket.

A return trip, he says, should always be the same as two one-ways – the choice of fare on the return leg independent of the outward. At present, a London-Brighton Off-Peak Return costs just 10p more than a single, representing a price increase of just 0.3 per cent for a journey 100 per cent longer.

For commuters, everyone should start travelling at the specified daily rate using an app, contactless payment or a smartcard, with a progressive discount is given for multiple trips.

“No up-front season purchase, no need to know in advance exactly how many trips you’ll need to make,” he says.

The rail guru also says there is a case for the “simplification of flows” where there are multiple fares on different routes or train operators with same origin and destination. At Gatwick airport, for example, befuddled airline passengers are confronted with ticket machines offering 27 different fares to London.

Mr Smith stresses the Department for Transport (DfT) should not be making the necessary changes.

“It needs to happen at arm’s length from government, managed by rail professionals,” he says. “It should be one of Great British Railways’ first major objectives.” This is the body envisaged by the Williams-Shapps Plan for Rail, which is ending the fragmented system of privatisation.

Most industry experts agree that drastic fares reform is essential. But there are two perennial problems. The first is fear at the Treasury that the usual £10bn in fares revenue will drop significantly, creating a gap that taxpayers must fill. The second is that if “revenue neutrality” is achieved – maintaining the total fares take – then some ticket prices will need to rise steeply.

Mr Smith says: “There’s a tendency to avoid doing anything that can’t be precisely worked out beforehand.

“Such a necessarily ruthless reform of fares, and such bold overhaul of pricing is too great a change for effects to be predicted accurately.

“So how to mitigate the risks? You’re not stuck with prices implemented on day one.

“You give it your best shot based on the data you have. If aggregate revenue undershoots or overshoots, you’ll know in a relatively short period and can adjust prices incrementally until revenue neutrality is achieved.

“Plan, do, review…”

Mr Smith joined British Rail as a graduate trainee in the 1980s and later became the manager of London’s most central station, Charing Cross.

He later worked on fares at the Department for Transport, then created what would become the leading rail portal, Seat61.com – named after his favourite seat in First Class on Eurostar trains to the Continent.

The website provides free advice and encouragement to international rail passengers.