Load- and distance-dependent fares

[Indigo Soup]

The underlying principle here is that we break down the network into segments. Each segment runs between two adjacent stations (1) and has a single base fare applied. For a journey over more than one segment, which of course most will be, the base fare for that journey is determined by summing the fares for each journey segment. Actual fares charged would then be derived from a multiplier applied to the base fare for that ticket type.

The setting of base fares is the tricky part. The principle is that it should cost more to travel further, and that it should cost more to be on a busier train. So we need a formula based on mileage and on the load factor.

For each segment, the load factor should be calculated on the basis of all trains passing through that segment, even if they do not stop at the stations defining that segment (2). A nationally standardised formula would then be used to determine the rate per mile for each segment, on the principle that it should always be cheaper per mile to travel on a quiet section than a busy one; a power law is probably the way to go for the congestion element of the mileage rate. Since a segment would only ever have one applicable route (3), the question of alternative routes doesn't come up in determining segment prices.

Also, a power-law formula for determining segment mileage rates means that no segment can have a negative rate. That means that you can never have a situation where it's cheaper to get a ticket from A to C than from A to B, though rounding may make the two fares equal. It may be wise to add a flat rate base element to the mileage rate, though, purely so that one can't roam the Far North line for free.

Managing tickets valid across multiple routes is of course a little tricky. In most cases, though, the principle should be that the fare is determined by the direct route, and any cheaper route is permitted. Of course, this passes the buck down to the definition of 'direct'. The dual mileage and congestion basis of the system should avoid too many anomalies cropping up with respet to routing. Where a longer but cheaper route (avoiding areas of congestion) is available, this should generally be available as 'Via X', with the goal of encouraging less time-sensitive travellers to take less busy routes.

In this system, the only parameters that could be tweaked would be:
* Ticket-type multipliers
* The national average mileage rate
* The base mileage rate
* The rate at which congestion causes fares to increase

At the annual fares review, as well as modifiying the mileage rates in line with inflation (4) the load factors for each segment should be reassessed and fares adjusted accordingly.

I'd envisage this system existing in parallel with a revised system of Advance fares, which are regulated to ensure that Advance fares are only available on services with a low load factor and to ensure that they are not oversold.

So why won't it happen?

The obvious reason is that the train operators lose a lot of commercial freedom. All fares would become regulated, so that their income would be more or less fixed. To make more money, they'd have to either get more people on trains, or else find some way of selling enhanced services. Care would be needed to make sure that operators aren't incentivised to create congestion as a way of increasing fare receipts. A more complex formula which reduces fares on overcrowded services might work, but doesn't discourage people from travelling on them. Alternatively, fares and train operator income could be decoupled, which would be a massive structural change.

It would also mean completely scrapping the existing fares system. Some fares would go up and others down, perhaps by quite a bit in both cases. There would also be a lot fewer Advance fares. While the system ought to be designed so that total farebox receipts don't change, they'll be rebalanced quite a lot. People who habitually travel cheaply on busy routes will not be happy with this state of affairs. The annual reassessment based on changing load factors will mean that this is an annual exercise - and one which will probably see even more vocal opposition than the current inflation-based increases.

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Notes:

(1) In some cases, station groups may be appropriate, but should generally be avoided.
(2) Because the fare A-B-C is equal to the sum of fares A-B and B-C, this ensures that high traffic between intermediate stations does not force fares downwards.
(3) I can't think of any places where there is more than one non-diversionary route between two stations without passing through a third, though I'm happy to be corrected.
(4) The fare type multipliers and the congestion factor should be left alone unless there are exceptional circumstances.

 

[Bevan Price]

When I saw the title of your thread, I wondered if it was an idea to charge passengers according to their size / weight, e,g, double fare for anyone so "wide" that they almost occupy 2 seats.
Personally, I think that your ideas would create anomalies and be unpopular with many passengers.

And, for example, if I understand your system correctly, why should the fare paid by the passenger (occasionally) using the daily train from Polesworth have their fare affected because dozens of other trains pass through that station ?

 

[yorkie]

Interesting ideas but how might York to Leeds be priced? Intermediate stations (ignoring via Castleford or Harrogate) are Ulleskelf, Church Fenton, Mickefield, East Garforth, Garforth, Cross Gates.

If anyone can come up with suitable fares that make sense and would be commercially and politically acceptable for each individual segment, as well as the overall whole journey, I'd be very impressed...

 

[pdeaves]

With all 'mileage-based' fares system proposals, the arguments will start when considering alternative routes (as the original post alludes to). E.g. Swindon-Bristol Temple Meads via Bath or via Bristol Parkway (both of which could have direct trains). What should the SWI-BRI fare be? How does that square if you take the other route? Then the crunch: what about intermediate stations - could they end up with a higher fare than the longer route?

 

[PeterC]

Milage based charging would always need tweaking to account for alternative routes. The LT&SR routes give a nice self contained example with three possible routes from Fenchurch Street to Southend. You would need to establish a "notional" distance from Barking to Pitsea that didn't disadvantage Southend passengers and didn't produce anomalies for Stanford-le-Hope and other Grays line stations or create an excessive local fare from Laindon or Basildon.

Then scale it up to Great Eastern.

 

[Indigo Soup]

And, for example, if I understand your system correctly, why should the fare paid by the passenger (occasionally) using the daily train from Polesworth have their fare affected because dozens of other trains pass through that station ?

The principle is that you're assigning fares to sections of track, not to particular services. One could equally well ask why the railway should get a different income from one passenger travelling Atherstone to Tamworth than one travelling Atherstone to Polesworth and one travelling Polesworth to Tamworth. Or, indeed, a passenger travelling through Atherstone, Polesworth and Tamworth at line speed without even realising there was a station.

With all 'mileage-based' fares system proposals, the arguments will start when considering alternative routes (as the original post alludes to). E.g. Swindon-Bristol Temple Meads via Bath or via Bristol Parkway (both of which could have direct trains). What should the SWI-BRI fare be? How does that square if you take the other route? Then the crunch: what about intermediate stations - could they end up with a higher fare than the longer route?

Milage based charging would always need tweaking to account for alternative routes.

Without actually doing the exercise - which would need access to a lot of commercially sensitive data - I suspect that the demand-based element would provide most of that tweaking. The demand-based aspect is more important to this scheme than the distance-based element, and you could quite happily modify it to remove distance altogether as a measurement without impacting the fundamental concept, though it would weaken the principle that a longer journey should cost more. In either cases, you'd wind up with a notional rail map where distances between stations are expressed in fares, and of course anomalies would exist.

I'm not particularly trying to get rid of anomalies, they exist now and they'll always exist. Circumstances where it's more cost-effective to travel away from your destination in order to approach it via an alternative route would be, I'd suggest, very unusual. Especially where either the origin or destination is a major station, since the most expensive segments would be the busy ones close in and could only be avoided by substituting (say) Finsbury Park to Kings Cross for Kentish Town to St Pancras. I'd anticipate the major anomalies to relate to unexpectedly cheap travel along the 'watershed' between higher-cost regions.

The most expensive segment of the LTS route (to use that example) will almost certainly be Limehouse to Fenchurch Street, falling off as you head east but picking up again towards Southend, with a dominant flow to/from Fenchurch Street; for points east of Pitsea, the Basildon route seems to be the natural route (more services and faster) so that traffic from Pitsea to Grays would be relatively limited, leading to a relatively low fare for this segment. In most cases, this would result in the 'natural route' having the higher fare and longer alternative routes being cheaper. In fact, a self-contained network like LTS would probably be the easiest to adapt to this system as a trial.

I freely admit that one of the key disadvantages of this system is that it would create much higher fares on the busiest routes. This is the point, of course, as it incentivises train operators to invest on these routes and passengers to use less-expensive alternatives. It would also be incredibly unpopular with those who depend on using those busy routes to commute.