The Railway Industry Association’s (RIA’s) ‘Destination: Revenue Growth’ report examines the landscape of UK rail’s current ticketing and retail offer. It analyses the gaps between the Government’s aspirations, policy and implementation; and it makes a number of key ‘asks’ to overcome those gaps, with the goal of enhancing the customer experience and boosting ridership, to drive revenue growth without increasing ticket prices.
The current UK mainline ticketing offer is the result of many years of patchwork development, a mix of legacy and modern systems. During those years, a combination of rail privatisation, devolution, and oft-changing political vision, leadership, and strategy have all contributed to this piecemeal approach. The immediate impact is that the railway system in the UK falls far short of customer expectations, putting many potential customers off. Knock-on effects include elevated costs to the taxpayer and under-utilised assets.
Recent research commissioned by RIA and conducted by the independent Steer consultancy shows that the right customer offering could contribute to growth in passenger numbers of between 37% and 97% by 2050. As customer experience is linked to ridership, this represents a much missed opportunity to maximise revenue, minimise subsidy, and accelerate decarbonisation.
In contrast, Transport for London (TfL), with stable leadership, a strong vision, forethought and the autonomy to implement, have created a system highly-regarded both by those who use it, and on the international stage. Pioneering ‘contactless’ ticketing has earnt the trust of the travelling public in and around the capital, and contributed significantly to ridership and revenue growth. Conversely, national mainline rail ticketing is often mistrusted by the public, having a deleterious impact on ridership and revenue.
Government policy has identified the same concerns. The cornerstone of the current Rail Reform agenda, the so-called ‘Plan for Rail’, makes a number of promises on rail retail. However, RIA has identified several shortcomings in the proposals for rail retail implementation, and these will need to be resolved to meet desired Rail Reform outcomes.
In addition, the blueprint discussed in ‘Destination: Revenue Growth’ charts a timeline of recent Government U-turns and indecision, which arguably makes it impossible for any entity – private or state – to plan for a better future.
We conclude by making four recommendations, or key ‘asks’, which we believe will need to be delivered on if the shortcomings identified in the ‘Destination: Revenue Growth’ paper are to be overcome and the Government enabled to achieve its stated goals.