How getting the low-down on rail fares might make passengers worse off

Busting the myths of free data.

The Association for Train Operating Companies (ATOC) has for the first time made its database of rail fares available to website and mobile app developers for free as part of a governmental push for data transparency. But will this unprecedented openness offer customers a better deal and simplify ticket-buying, or merely close loopholes that currently present cheaper fares?

Rail fares in the UK are the most expensive in Europe, and the ticketing system one of the most complex. This has made buying the best value train tickets an arcane art of juggling different journey times, ticket types, routes and purchasing dates, which can lead to unsuspecting passengers falling foul of restrictions and subject to penalty fares.

David Sidebottom, director of independent passenger watchdog Passenger Focus, says: “Value for money has become the Achilles’ heel of the rail industry, with less than half of passengers in our most recent survey saying that their ticket was good value. Some passengers tell us that they can find the fares system complicated and illogical.”

One such passenger is professional opera singer Kirstin Sharpin, who travels extensively for work and books train tickets up to five or six times a month depending on where she is working, but still struggles with current online booking systems.

“Apart from one extraordinary experience where a last-minute First Class London-Glasgow ticket was cheaper than the same journey in Standard, rail fares are a thing of mystery and confusion, as well as a thorough embarrassment for this country, when tourists are charged huge penalty fares for innocent mistakes,” she says.

Despite the fanfare around the press release making it sound like passengers can access this data, the reality is it comes with an 80-odd page manual for data administrators to upload it for websites and smartphone apps. However, once there, it will enable travellers to take better advantage of what is known as split tickets.

If a train journey from London to Newcastle is £100, for example, a traveller could book tickets for London to Peterborough, and Peterborough to Newcastle as separate journeys much cheaper, without having to change trains. Further savings could potentially be found by buying tickets for part of the journey in advance and another part on the day of travel.

Nevertheless, if websites and apps developed to use the data prove successful, the scheme may in time backfire. If rail operators find their revenue is reduced by increasing numbers of customers exploiting anomalies in the system such as splitting tickets, they might just get rid of those anomalies and price it proportionally.

But in the long run exposing these inconsistencies could lead to a clearer future pricing system - the UK has an exceptionally complicated fares system, and splitting tickets makes it even more complicated. Finding the best deal is not for the faint-hearted, and getting it wrong can find the ticket-holder on the receiving end of a penalty fare or unpaid fare notice, because the restrictions on these tickets are so confusing.

The UK’s system is not all bad, however, and any simplification must be careful not to counteract current advantages. Although the UK’s turn-up-and-go fares are far more expensive that the rest of Europe, for example, our continental counterparts offer far less frequent trains without the advantage of much cheaper advance fares.

The ATOC data release is for now a triumph for data transparency, but it may take a while before rail travellers feel they are getting a genuinely good deal.

Photograph: Getty Images

Berenice Baker is Defence Editor at Strategic Defence Intelligence.

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BHS is Theresa May’s big chance to reform capitalism – she’d better take it

Almost everyone is disgusted by the tale of BHS. 

Back in 2013, Theresa May gave a speech that might yet prove significant. In it, she declared: “Believing in free markets doesn’t mean we believe that anything goes.”

Capitalism wasn’t perfect, she continued: 

“Where it’s manifestly failing, where it’s losing public support, where it’s not helping to provide opportunity for all, we have to reform it.”

Three years on and just days into her premiership, May has the chance to be a reformist, thanks to one hell of an example of failing capitalism – BHS. 

The report from the Work and Pensions select committee was damning. Philip Green, the business tycoon, bought BHS and took more out than he put in. In a difficult environment, and without new investment, it began to bleed money. Green’s prize became a liability, and by 2014 he was desperate to get rid of it. He found a willing buyer, Paul Sutton, but the buyer had previously been convicted of fraud. So he sold it to Sutton’s former driver instead, for a quid. Yes, you read that right. He sold it to a crook’s driver for a quid.

This might all sound like a ludicrous but entertaining deal, if it wasn’t for the thousands of hapless BHS workers involved. One year later, the business collapsed, along with their job prospects. Not only that, but Green’s lack of attention to the pension fund meant their dreams of a comfortable retirement were now in jeopardy. 

The report called BHS “the unacceptable face of capitalism”. It concluded: 

"The truth is that a large proportion of those who have got rich or richer off the back of BHS are to blame. Sir Philip Green, Dominic Chappell and their respective directors, advisers and hangers-on are all culpable. 

“The tragedy is that those who have lost out are the ordinary employees and pensioners.”

May appears to agree. Her spokeswoman told journalists the PM would “look carefully” at policies to tackle “corporate irresponsibility”. 

She should take the opportunity.

Attempts to reshape capitalism are almost always blunted in practice. Corporations can make threats of their own. Think of Google’s sweetheart tax deals, banks’ excessive pay. Each time politicians tried to clamp down, there were threats of moving overseas. If the economy weakens in response to Brexit, the power to call the shots should tip more towards these companies. 

But this time, there will be few defenders of the BHS approach.

Firstly, the report's revelations about corporate governance damage many well-known brands, which are tarnished by association. Financial services firms will be just as keen as the public to avoid another BHS. Simon Walker, director general of the Institute of Directors, said that the circumstances of the collapse of BHS were “a blight on the reputation of British business”.

Secondly, the pensions issue will not go away. Neglected by Green until it was too late, the £571m hole in the BHS pension finances is extreme. But Tom McPhail from pensions firm Hargreaves Lansdown has warned there are thousands of other defined benefit schemes struggling with deficits. In the light of BHS, May has an opportunity to take an otherwise dusty issue – protections for workplace pensions - and place it top of the agenda. 

Thirdly, the BHS scandal is wreathed in the kind of opaque company structures loathed by voters on the left and right alike. The report found the Green family used private, offshore companies to direct the flow of money away from BHS, which made it in turn hard to investigate. The report stated: “These arrangements were designed to reduce tax bills. They have also had the effect of reducing levels of corporate transparency.”

BHS may have failed as a company, but its demise has succeeded in uniting the left and right. Trade unionists want more protection for workers; City boys are worried about their reputation; patriots mourn the death of a proud British company. May has a mandate to clean up capitalism - she should seize it.