“Government must rule out higher peak-time fares” – MPs

The Rail 2020 Report by the Transport Select Committee says ministers must not use increases in peak-time rail fares to manage passenger numbers. MPs also warn that people need to be confident public subsidies do not 'leak out of the system in the form of unjustified profits'.
by - 4th January 2013, 7.55 GMT

Rail unions and campaigners have welcomed an MPs’ inquiry into the future of the UK rail industry which calls on the government and regulator to ‘shine a light on complacent management, waste and profiteering’.

(Pictured: MPs call for reform of rail franchising system, following 2012 West Coast Mainline fiasco)

The Rail 2020 report by the House of Commons Transport Select Committee also says confidence in the Department for Transport has been ‘badly shaken’ by last year’s debacle over the West Coast Mainline franchise.

The MPs – who heard evidence on the off/on award of the franchise to Virgin Trains from the Transport Secretary, Patrick McLoughlin – said the Coalition government should consider delegating management of all rail franchises to an independent, ‘arms-length’ body.

TSSA general secretary Manuel Cortes welcomed the committee’s stand against even higher peak-time fares.

“This is the clearest warning to ministers against going down the route of rationing rail travel by pricing passengers off trains through Super Peak Fare tickets.

“With thousands of passengers in the South East now paying over £5,000 a year for an annual season ticket, that well is already clearly running dry.

“We also welcome the clear rejection by the committee of the McNulty Report’s central proposal, the closure of 750 smaller ticket offices with the axing of thousands of station staff jobs.

“We cannot cut our way to an affordable railway through another round of Beeching-style cutbacks.”

The Transport Committee says it supports the general approach of Sir Roy McNulty’s widely-debated report into the future of the railways and for achieving substantial savings.  However, it considers his target to save £3.5 billion by 2018/19 to be ‘challenging’.

RMT General Secretary Bob Crow said: “Whilst this report reinforces once again that our railways are nothing more than a multi-billion pound rip off lining the pockets of a bunch of spivs and speculators it ducks the real issue, and that’s the cast-iron case for public ownership.

“You can’t have transparency, accountability and value for money while our railways are bust apart and run as a money-making racket for a gang of private operators.

“Until Labour and the rest of the political class wake up to that fact, the great British rail robbery will continue unchecked with passengers bled dry while the train companies are laughing all the way to the bank.

“The report also shines a light on the lethal safety implications of cutting station, track and on-train staff – all measures that are right at the heart of the Government’s McNulty rail review proposals currently working their way through the parliamentary process.

“If the politicians don’t halt McNulty, and reverse the rip-off of privatisation, the public can expect to pay through the nose to travel on an unsafe, overcrowded railway run solely in the interests of private profit.”

In comments which unions will welcome, the MPs express concerns about safety, staffing levels and the protection of passengers’ interests.

TUC general secretary and Chair of the Action for Rail campaign Frances O’Grady said: “We agree that more transparency is needed when it comes to rail industry funding.

“Our own research shows that the train companies received over £2.5bn in taxpayer subsidies last year.

“Yet the train travelling public – which has been hit hard this week with the New Year hike in fares – would understandably like to know where every penny of taxpayer subsidy is going.

“Regular railway users who find themselves paying much more for substantially less will wonder how much of taxpayers’ money is going into the profits of the train companies – many of whom would struggle to run a service without a government subsidy.

“MPs on the Committee also share union concerns that proposals to find savings through the de-staffing of trains and stations could make the railways less safe, especially for women and vulnerable passengers.

“Any changes to staffing should improve the passenger experience, not make it worse.

“And we know from repeated surveys that passengers want a visible staff presence on trains and stations.”

The Committee calls on the Department for Transport to consider delegating the awarding and management of rail franchises to an arms-length body and should also consider reviewing franchises every 5 years.

The MPs say ministers should examine whether to spread premium payments over the full length of each franchise contract, in light of the West Coast fiasco.

The report also suggests that franchises should be designed to deliver wider policy objectives such as the promotion of ‘sustainable end-to-end journeys’, the quality of the passenger experience, or economic development.

Louise Ellman MP, Chair of the Transport Committee said: “The number of rail passengers has increased but train companies’ unit costs have not come down.

“The Government wants to reduce the cost of the railway to taxpayers, but it must not do so by ramping up fares which can be complex and are often very expensive.

“Ministers must urgently set out a long-term policy on fares and rule out using higher fares to reduce peak demand for train services.”

“It is vital we know far more about how public money is spent so that there is confidence it does not leak out of the system in the form of unjustified profits.

“Commercial confidentiality should not be used to block legitimate requirements for information.”