Passengers taking up train strain

Published: Monday 16th February 2015 by The News Editor

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Passengers are pouring more and more money into the rail industry but Government funding for rail is dipping, according to official figures.

Government funding per passenger is far less in England than it is in Scotland and Wales, the statistics from the Office of Rail Regulation (ORR) also showed.

Issuing a financial report, the ORR said rail industry income from passengers in 2013/14 was £8.16 billion – a 10.8% rise compared with the figure for 2010/11 and 6.2% higher than in 2012/13.

Government funding for the railways in 2013/14 was just under £3.8 billion – a 16.4% dip on the total for 2010/11 and 8.1% down on 2012/13.

Total Government funding in 2013/14 varied from £1.88 per passenger journey in England to £7.77 per journey in Scotland and £9.18 per journey in Wales.

Government funding in 2013/14 represented 28.5% of the rail industry’s total income.

The ORR said that passengers had contributed an increasing proportion of the rail industry’s income relative to taxpayers over the past four years – up from 55.6% in 2010-11 to 61.5% in 2013-14.

Of the income from passengers in 2013/14 a total of £2.8 billion came from regulated fares which include season tickets and which accounted for £1.81 billion, while £5.3 billion came from unregulated fares such as off-peak leisure tickets.

A further £800 million came from areas such as car parking fees and on-board catering.

With the number of passenger journeys increasing 5.7%, the average passenger income per journey in 2013/14 actually fell 2.1% to £5.14 but passenger income per passenger kilometre travelled rose 0.2% to 14p.

The ORR said the cost of running Britain’s railways in 2013/14 was just under £12.7 billion – a rise of 0.7% on 2012/13 but almost exactly the same as the figure in 2010/11.

The number of passenger journeys increased by 16.6% (or by 260 million journeys) between 2010/11 and 2013/14, with the amount of freight carried rising 18.1%.

ORR chief executive Richard Price said: “There has been substantial growth in the use of the railways in the past four years. Passengers are increasingly the main funder of the railways, and must be central to developing plans for future services and investment.

“Our report also highlights that the rail industry has been successful in keeping costs stable despite carrying significantly more passengers.”

Manuel Cortes, leader of the TSSA rail union, said: “These figures reveal the true scandal of who carries the real burden in the privatised rail industry – the poor old passengers.

“These (train) firms are getting a free ride while the passengers have to pay the highest fares in Europe. They are laughing all the way to the bank as they get away with daylight robbery.”

Train drivers’ union Aslef said: “Despite receiving £3.8 billion in Government subsidy, train operating companies still paid out dividends to the value of £183 million.”

A spokesman for the Rail Delivery Group, representing rail operators and Network Rail, said: “The regulator’s report shows why Britain now has one of Europe’s fastest growing railways.

“As an industry we are focused on improving services and attracting even more passengers and freight to travel by train while reducing taxpayers’ overall contribution.”

He went on: “Backed by investment from successive governments and commitments made by train operators, we are determined to keep improving and have recently set out our commitments to build on the current success to deliver even better services that passengers and businesses need.”

Rail Minister Claire Perry said: “We are investing record amounts in our railways as part of our long-term economic plan and passenger fares have a crucial role to play in funding these improvements, which will bring more services, more seats and modern trains.

“As we drive forward this huge investment programme, it is absolutely important that disruption to passengers is kept to a minimum. It is also important that we recognise passengers’ concerns about the cost of rail fares. This is why we have frozen them for the second year in a row.”

Shadow rail minister Lilian Greenwood said the ORR report, showing details of finance records for each train company, ” proves that the forthcoming East Coast sell-off is set to be a terrible blunder that puts privatisation ahead of passengers’ and taxpayers’ best interests”.

She went on: “East Coast was one of only two train operating companies that made a net contribution to the Treasury once infrastructure costs were taken into account.

“This is a service that the Government rushed to privatise without even allowing the publicly-owned British operator to bid for the route. Labour will end the bias against the public sector and institute a new body for running the railway which will have a strong voice for passengers at its heart.”

Published: Monday 16th February 2015 by The News Editor

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