Why rail fares are so high

The BBC highlighting very high rail fares in the UK today is inclined to suggest the cause is the government’s policy of requiring more of the costs to be paid by passengers and less by taxpayers. It is one of Labour’s policies that I support. The true cause of high rail fares in the UK is the high cost way our railway is run. Fares are a rip off in many cases. They do need to be brought down. Pumping more taxpayer cash in is not the way to do it.

Britain’s railways are neither green nor good value for money. Indeed to some extent the bad policies that damage the environment are the same ones as make the railways too dear. Put simply, the UK runs too many unpopular trains that are more than half empty, too many heavy trains which require too much energy to speed them up and slow them down, and runs too many old and inefficient engines to haul them.

The railway also uses people wastefully, as it does fuel. It runs on too many consultants, managers and non operational staff, living in its own overregulated high cost world. Compare the approach of the railways with that of the low cost no frills airlines, and you will see what I mean.

It would be a good idea to have a blitz on all those costs and requirements which make our railways high cost. We need more trains on popular routes at popular times – especially commuter routes during the morning and evening peak. Unfortunately with heavy trains, poor brakes and old signals it means we cannot run nearly enough trains on the generous amounts of track we have. Let’s buy cheaper lighter trains that can speed up and slow down much more rapidly, allowing many more trains an hour.

Fly over southern England at the morning peak and you see crowded main roads with traffic bumper to bumper, and largely empty railway lines with large gaps between trains for safety reasons owing to the type of train, and the traction and braking system. We need either to fill more of the seats at off peak times by price discounting, or to reduce the number of unpopular trains trundling around the country largely empty. The railways have some of the bets routes in to our city centres, but they simply are not used enough owing to the technology.

Since Labour nationalised Railtrack the costs of providing and maintaining the track have shot up. It has been a consultants field day. The business is most unresponsive to commercial opportunity. Take them a property project to improve a station and make some money from associated commercial development, and they will sit on it or fail to progress it for years. In Wokingham they stayed out of the property boom as they did elsewhere, failing to improve their own property from profits on commercial development on their extensive land holdings.

The nationalised railway in the long post war period failed to put in a simple spur line to Heathrow, the world’s busiest international airport, until the idea of private capital finally brought about such an obvious business move. The rail network was great for Victorian industry, and even managed to update itself for the early twentieth century business estates. The long years of nationalisation saw the railways fail to move with the times. Now much of industry is on newer business parks located by motorways, without spur lines and sidings, because the railway failed to market itself to business to carry goods.

We need a more commercial approach. The railways could have a relative advantage at taking more commuters and more goods traffic. If they did so successfully they could lower the fares, because they would have more revenue and less cost for each journey. They need lighter trains, cheaper trains, fewer consultants and better traction.

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21 Comments

  1. alan jutson
    Posted February 19, 2009 at 7:56 am | Permalink

    They also need a less complicated and far more simple fare structure.

    If people could see at a glance how much it would cost to make a journey by rail instead of having to spend hours trawling through thousands of options then they may be encouraged to use it more often.

    I am not a usual train traveller, but I have to say my journey from Wokingham to London and return on Saturday, off peak, off this, off that, special offer for £13.50 return seemed good value.

    Think its nearer £40 in the week (£200 for a weeks travel)

    Agree that Wokingham Station could do with modification (hinted at 10 or more years ago), the Level crossing backs up traffic through the Town causing jams during rush hours, cross rail will add to the traffic chaos as I understand it will double the amount of traffic on this particular section of rail and thus double the level crossing closures.

  2. Ian Jones
    Posted February 19, 2009 at 8:02 am | Permalink

    The problem is that car travel is costed below the cost of the externalities they cause. This is why people travel in a car rather than the train as it is cheaper and more convenient. In Japan to drive into Tokyo and back will cost you £30 a day in tolls whilst the company pays for your commute train ticket tax free (income and NI). Thus most people get the train!

    The only politician who had any balls to do such a thing was Red Ken and as much as I hate the rest of his policies on this one he was right. Unfortunately Boris is reversing it and I doubt the next Govt will introduce road pricing.

    You get what you pay for…..

    reply: Not so.Levels of motoring tax in the UK mean motorists pay several times over for their “externalities” whilst trains are heavily subsidised.

    • Stuart Fairney
      Posted February 20, 2009 at 8:55 am | Permalink

      If ever there is a made-up concept it is “externalities”

      In other words, I don’t like the obvious truth that the numbers show, I will therefore simply make-up some other nonsense on the basis of dodgy information and say “Ah ha, but if you add because of you will see that actually makes financial sense”

      It is childish, transparent nonsense.

  3. Rob N
    Posted February 19, 2009 at 9:16 am | Permalink

    We need a rail network of low speed, efficient light local trains (or decent raod networks and Parkways), that give you access to high speed hubs which in turn get you into the cities on efficient high speed trains.

    Com’on Stellios when do we get easyTrains?

  4. Glyn H
    Posted February 19, 2009 at 9:42 am | Permalink

    All solid comment sir, but what of the absurd leasing and track costs (which made mega sums for RBS et al) and utterly obstructs flexibility – caused by the absurd way BR was privatised? It was completly the wrong model then and is now. Executed under OUR government! All made far worse by Byers of course but then the Socialist government has run with PFI’s to disguise the spectacular mess Mr Brown has made of the economy. How can we right those two wrongs in the future?

    Reply I would myself reunite track and trains under common ownership of private train companies

  5. Lola
    Posted February 19, 2009 at 10:21 am | Permalink

    British Railways – a property company, or more accurately a land owning company – with a hobby.

  6. Derek Monnery
    Posted February 19, 2009 at 10:25 am | Permalink

    As Chairman of a Federation of Essex Rail User Groups, I have to say that once again John Redwood is pontificating about things he does not understand.  His party wrecked and asset stripped the railways in the 1990s.  Railtrack starved the railways of the investment that was desperately needed, and Network Rail has now provided (hence increased cost).  Remember the speed restrictions after Hatfield when the negilgence of Railtrack was exposed?  There were several rail crashes involving loss of life that can be directly traced back to the confusion caused by privatisation.No, I don’t think Labour have done well either, because fares are far too high, encouraged by monopolies created by privatisation, which Labour has condoned.Don’t be naive, John.  Most rail companies are relatively streamlined these days.  There is little if any fat. I know you find it hard to accept, but all other countries in Europe subsidise their rail services, seeing them as a public service, like the NHS.   The fact that neither the Tories nor the Labour party accept this approach is why our fares are so high, end of story.

    Reply: What demonology on privatisation. Privatisation produced a safer and more attractive railway which more people used, and the subsidies came down.

    • Lola
      Posted February 19, 2009 at 12:34 pm | Permalink

      Private capital built the railway network. WW2 wrecked it. nationalisation destroyed it. It is now wildly innefficient and wasteful of resources especially energy. The current structure entirely mitigates against innovation and suffers from excessive bureaucratic interference. The Tory privatisation was not as well done as it should have been. Ut’s now morphed into another wealth destruction vehicle.

      Oh, and the NHS should be boken up with the money following the patient as should eductation.

      • Lola
        Posted February 19, 2009 at 4:57 pm | Permalink

        Oh, and another thing. There are no such things as ‘public services’. There are ‘services’ that are monopolised and controlled and run (hah! – they couldn’t run a bath) by the state. Such services could all equally be provided by private business. And at better efficiency. If we thought that say education was a Good Thing and should be paid for colleectively we would give every one a voucher to spend where they thought best.

        The same is true of rail.

  7. bill
    Posted February 19, 2009 at 10:25 am | Permalink

    It was my misfortune to work on part of the Tory privatisation which IMO could have been far better designed.

  8. Neil Craig
    Posted February 19, 2009 at 11:44 am | Permalink

    This BBC highlighting is because of a report by Passenger Focus which they decided was so prominent they should put it high in their listing of news. The report says that our fares are higher than most of Europe’s which cannot have been too onerous to compile – they didn’t even look at anybody outside Europe.

    I bet many of us wish that, merely by sending out a press release & calling it a report, we could be guaranteedc such air time, or indeed any airtime.

    What the BBC do not report is that this “consumer group” calling for & lobbying the government for more government subsidy & taxes is actually a wholly owned government quango.

    This is known as astroturfing. While real grassroots organisations such as the Taxpayer’s Alliance are almost banned by the BBC they enthusiasticly promote any disguised government call for more big government.

  9. no one
    Posted February 19, 2009 at 12:04 pm | Permalink

    john

    sorry dont agree on this one

    most of the commuter over crowding could be addressed by staggering the working day, there is no reason at all for so many people working in the big cities to be tied to a 9 to 5 day, it is complete nonsense to gear up the transport network up to try and deliver peak hour capacity when it is so under used at other times

    on the lighter trains front again dont agree, virgin cross country (as was they lost the franchise?) did this by replacing the old rolling stock with trains designed in italy (i seem to remember?) for short journeys, but then started using them as long distance trains edinburgh to the south coast etc, far too little room for passanger luggage causing real safety issues as folk cannot move easily around, seats are too thin for comfort on that length of journey, and unreliable cos the trains are not designed for that long distance

    reliable safe long distance trains need to be a bit more substantial than the light trains you have in mind

    you need to think again on this one

    • Adrian Peirson
      Posted February 19, 2009 at 12:58 pm | Permalink

      Excellent Idea, unfortunately, it has too much simplicity and common sense attached to it, it will never catch on in Westmonster.

    • Lola
      Posted February 19, 2009 at 4:54 pm | Permalink

      Nope, it is perfectly possible to build light, safe, strong and durable rolling stock and locomotives for both long and short distances. Composite technologies permit this. The problem is that the statist system entirely mitigates against making such investments as no operator can see an economic return.

      ‘Light rail’ like the DLR is not what’s being talked about, although it does have it’s place. It might be that down-grading some of the commuter lines into London to ‘light rail’ would improve their capacity. Again innovative thinking like this is strangled by statist bureaucracies and vested interests.

  10. Adrian Peirson
    Posted February 19, 2009 at 1:00 pm | Permalink

    And might I add, that if we took control over our own money, instead of borrowing this worthless stuff at face value, people would only have to work 2-3 days per week in order to earn a decent living.

    See how this scam gets to the root of all that is wrong with Britain, and indeed the world.
    http://www.prisonplanet.com

    • chris southern
      Posted February 19, 2009 at 8:07 pm | Permalink

      it’s the system (fractional reserve banking) that’s screwed up Adrian.
      even with gold you can debase the currency (clipping, smelting and adding impurites before recasting, filing etc)

      and the banks won’t/don’t want to change the system as they make a fortune from it.
      problem is it’s more or less run the course due to the mathematical limitations of the system, speeded up by the greed of the few and the stupidity of their unknowing conspiritors.

  11. David Hope
    Posted February 19, 2009 at 6:28 pm | Permalink

    On this rare occasion I must disagree with your comment on increased spending. I think being able to get from A to B cheaply is worth more public money compared to dodgy benefits, public sector pensions, badly planned wars, bank bailouts and all the other areas the government can find billions for. Especially when the roads are so clogged and we are supposed to get out of our cars. 500 million a year is quoted to be equal with Europe but say 200 million could bring fares down a bit and make them more reasonable on key routes where the alternative is gridlock into say london, leeds, manchester etc. However I do think the whole system needs absolute reform. Currently we have a private sector monopoly since when you travel there is often only one company offering a particular route. That is hardly competition and capitalism in action. Also the train operators need to be involved from station to the tracks they run on to the train so the blame and “it’s their fault” attitude is ended.

  12. Idle Pen Pusher
    Posted February 19, 2009 at 7:58 pm | Permalink

    Very thought-provoking post, Mr Redwood!

    I think I agree that lighter trains would make more sense. I have often wondered at the vast metal clunks chugging into my suburban south west London station and wondered why they are so obviously over-specified.

    But you are a politician, and therefore I don’t think backing one technology or another is something you should be doing, irrespective of whether I agree. What you should be doing is asking why the legal/regulatory/competitive framework TOCs operate in has produced this result and how that should be improved to encourage better outcomes.

  13. DBC Reed
    Posted February 20, 2009 at 7:56 am | Permalink

    Privatisation was supposed to make the railways better,cheaper ,safer. For John Redwood to argue that they are not much worse is ridiculous.
    New transport infrastructure puts up house prices and the price of surrounding land so you just have to tax land values to cross-subsidise the railways.Otherwise the railways subsidise the property market – a racket which the Conservative party ( and to be honest the others) are keen to perpetuate.
    When everything possible is done to pump up the land and property market , it bursts like a bubble worldwide.
    Land taxers have been warning about this for ages,but everybody knew better.

  14. Matt
    Posted February 20, 2009 at 8:08 pm | Permalink

    Please provide a link to these magical super light weight trains that will transform our railways. And please identify where the replacement of the enitre rolling stock on UK railways will come from.

    Alternatively investigate the spare land that is already owned for building additional parallel lines that would allow for dynamic overtaking but won’t be released because of public pressure. (The Tories wouldn’t bite the bullet on that one either – not just Labour)

  15. Bernard Palmer
    Posted February 21, 2009 at 1:23 pm | Permalink

    “Fly over southern England at the morning peak and you see crowded main roads with traffic bumper to bumper, and largely empty railway lines with large gaps between trains”…

    “and largely empty railway lines with large gaps between trains”…

    Obviously the time of the iron rail as a transport system is limited. Could be the time of the computer driven rubber tyre 6 seater coachs capable of riding around stopped coaches and also leaving the system if needed. This could be a reality within 5 years. Get the driver less coach at the bus stop, it enters the ex-railway system and then exits and drops you off outside your destination. It could even be your own car which then went off some where to park itself. The joke is that most of this technology is probably already there. Just needs the government to crash to get it going.

  • About John Redwood


    John Redwood won a free place at Kent College, Canterbury, and graduated from Magdalen College Oxford. He is a Distinguished fellow of All Souls, Oxford. A businessman by background, he has set up an investment management business, was both executive and non executive chairman of a quoted industrial PLC, and chaired a manufacturing company with factories in Birmingham, Chicago, India and China. He is the MP for Wokingham, first elected in 1987.

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