Everything you know about British train fares is wrong

The good old days. Image: Getty.

Editor’s note: This article dates from 2015. We repromote it every year because that’s how we roll.

Railways are complicated. Their mechanical complexity required the invention of the modern engineering profession to stop them from killing people (mostly). Just as importantly, their business complexity required the invention of the modern accounting profession to stop them from going bust (mostly).

A century and a half on, and many mergers, nationalisations, privatisations and re-nationalisations later, railway finance remains hard to follow. So when fares go up, you generally get to read misleading, knocked-together copy about how fares today are unreasonable and outrageous, how everything is better in other countries, and how everything used to be much nicer in the old days.

The blame for the sky having fallen varies with the publication’s bias. The Guardian blames privatisation and profiteers; the Telegraph blames regulation and bureaucrats. Both are almost entirely wrong.

Charging by use, not by set price

The very worst reporting on the cost of rail involves a cherry-picked comparison of particular journeys, where a foreign ticket is compared to the most expensive available walk-up UK ticket for a long-distance journey. This allows the Telegraph to pretend a ticket from London to Bristol costs £96.50, compared to £29 for the similar distance from Marseille to Nice.

In fact, a morning peak ticket from London to Bristol booked a day in advance costs £42.50, and an off-peak ticket booked a couple of weeks in advance costs £18. Newspapers run the same trick when they compare walk-up rail fares to advance-booked plane fares, which should amuse anyone who’s ever tried to buy a walk-up plane fare.

Look more closely, and you’ll find that UK long-distance and regional train fares are on a par with other high-income countries; the only exceptions are expensive peak-time walk-up tickets. In other words, the UK is better at yield management, selling cheap tickets on empty trains and expensive ones on full trains.

Who pays the piper?

The data required for a proper comparison is available, but is also confusing. To keep things simple, we’ll use data for England here (funding regimes in Northern Ireland, Wales and Scotland are different, reporting isn’t always consistent, and England makes up over 90 per cent of total spending).

In 2013-14, trains in England were subsidised to the tune of £2.3bn. That number is the subsidy that the government pays directly to publicly-owned track operator Network Rail (£2.9bn), minus the premium that train operators pay the government for the right to operate (£616m).

Passengers in England paid £7.1bn in fares in 2012-13. The 2013-14 data is not yet available, but if we assume there was no increase in fares paid, that would mean that total rail funding was at least £9.4bn.

So 24 per cent of the cost of running the rail network in England in 2014 was paid by taxpayers, and the remaining 76 per cent was paid for by train fares. This compares to 2010-11, when 36 per cent of the cost was paid by taxpayers and 64 per cent out of train fares.

In other words, the amount by which the state is subsidising the rail network is falling. The subsidy is also far less than is paid elsewhere. In New York City, taxpayers pay 44 per cent of the rail system’s operating cost. In Montreal, Canada, it’s 43 per cent, while in Sydney, Australia it’s 80 per cent.

In 2012, German rail consultants Civity carried out a study for the UK’s Office of Rail Regulation. That confirmed that the level of subsidy for Great Britain (including Wales and Scotland but not Northern Ireland) was low compared to other western European countries, particularly for commuters:

Percentage of train operating company revenues from taxpayer grants

Commuters pay a lot, but they still come

So commuter train fares in England are more expensive than those elsewhere. The pro-austerity coalition government has made deliberate and conscious policy decisions that reduce the amount that taxpayers pay towards the railways, and increase the amount that passengers pay.

The drive to cut subsidy has been concentrated on high-demand commuter services. Regional passengers get a good deal by international standards; so do long-distance passengers, so long as they’ve bought their ticket in advance.

Whether that’s a good way to structure things is very much open to personal taste. There is plenty of research to suggest that greater rail usage has benefits for society at large. On the other hand, rail usage in the UK has grown by 70 per cent since 1995 and by 9 per cent from 2010 to 2012 despite rising prices; most of this growth has been among commuters. In other words, as much as people grumble about lower rail subsidy and higher fares in the UK, they aren’t actually putting many people off.


But what about the privateers?

A final common complaint about the railways is that the train operating companies remove significant amounts of money from the system in dividends. You’ll be shocked to hear that this isn’t true either.

Train operators in England made a total profit of £250m in 2012-13. That’s about a 3 per cent margin on the industry’s revenue. By way of comparison, supermarkets make a revenue margin or about 6 per cent; Apple makes 40 per cent.

The upshot of all this is that, if we were to keep the subsidy at the same rate, eliminate operators’ profits tomorrow, and pass all the money saved straight onto commuters, it would lead to a cut in rail fares of 4 per cent. Once.

That’s even if you accept the case that train operators are useless parasites with the tendering process providing no benefits over recreating British Rail in-house, and if you assume that the process of restructuring would be cost-free.  That’s a pretty bold set of assumptions to make for the sake of a one-off 4 per cent cut in your ticket.

Rail subsidies are complicated, analysing things is difficult, and hacks are lazy: it’s no surprise that most commentary on the relative value of UK rail fares should be worthless. But, if you do the analysis properly, it turns out that when fares are higher, there’s a good reason for it: people don’t like paying tax.

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London’s rail and tube map is out of control

Aaaaaargh. Image: Getty.

The geographical limits of London’s official rail maps have always been slightly arbitrary. Far-flung commuter towns like Amersham, Chesham and Epping are all on there, because they have tube stations. Meanwhile, places like Esher or Walton-on-Thames – much closer to the city proper, inside the M25, and a contiguous part of the built up area – aren’t, because they fall outside the Greater London and aren’t served by Transport for London (TfL) services. This is pretty aggravating, but we are where we are.

But then a few years ago, TfL decided to show more non-London services on its combined Tube & Rail Map. It started with a few stations slightly outside the city limits, but where you could you use your Oyster card. Then said card started being accepted at Gatwick Airport station – and so, since how to get to a major airport is a fairly useful piece of information to impart to passengers, TfL’s cartographers added that line too, even though it meant including stations bloody miles away.

And now the latest version seems to have cast all logic to the wind. Look at this:

Oh, no. Click to expand. Image: TfL.

The logic for including the line to Reading is that it’s now served by TfL Rail, a route which will be part of the Elizabeth Line/Crossrail, when they eventually, finally happen. But you can tell something’s gone wrong here from the fact that showing the route, to a town which is well known for being directly west of London, requires an awkward right-angle which makes it look like the line turns north, presumably because otherwise there’d be no way of showing it on the map.

What’s more, this means that a station 36 miles from central London gets to be on the map, while Esher – barely a third of that distance out – doesn’t. Nor does Windsor & Eton Central, because it’s served by a branchline from Slough rather than TfL Rail trains, even though as a fairly major tourist destination it’d probably be the sort of place that at least some users of this map might want to know how to get to.

There’s more. Luton Airport Parkway is now on the map, presumably on the basis that Gatwick is. But that station doesn’t accept Oyster cards yet, so you get this:

Gah. Click to expand. Image: TfL.

There’s a line, incidentally, between Watford Junction and St Albans Abbey, which is just down the road from St Albans City. Is that line shown on the map? No it is not.

Also not shown on the map: either Luton itself, just one stop up the line from Luton Airport Parkway, or Stansted Airport, even though it’s an airport and not much further out than places which are on the map. Somewhere that is, however, is Welwyn Garden City, which doesn’t accept Oyster, isn’t served by TfL trains and also – this feels important – isn’t an airport.

And meanwhile a large chunk of Surrey suburbia inside the M25 isn’t shown, even though it must have a greater claim to be a part of London’s rail network than bloody Reading.

The result of all these decisions is that the map covers an entirely baffling area whose shape makes no sense whatsoever. Here’s an extremely rough map:

Just, what? Image: Google Maps/CityMetric.

I mean that’s just ridiculous isn’t it.

While we’re at it: the latest version shows the piers from which you can get boats on the Thames. Except for when it doesn’t because they’re not near a station – for example, Greenland Pier, just across the Thames to the west of the Isle of Dogs, shown here with CityMetric’s usual artistic flair.

Spot the missing pier. You can’t, because it’s missing. Image: TfL/CityMetric.

I’m sure there must be a logic to all of this. It’s just that I fear the logic is “what makes life easier for the TfL cartography team” rather than “what is actually valuable information for London’s rail passengers”.

And don’t even get me started on this monstrosity.

Jonn Elledge is the editor of CityMetric. He is on Twitter as @jonnelledge and on Facebook as JonnElledgeWrites.