Comment piece in Passenger Transport - "The railway risks becoming irrelevant"

[A0]

I'm not entirely convinced the leasing fees that say XC are paying for their HSTs are still paying back the original purchase cost that BR made in the 1970s and 80s for them...

OK - well done - that's 6 trains out of their fleet of almost 100. What about the other 95% ?

 

[ainsworth74]

OK - well done - that's 6 trains out of their fleet of almost 100. What about the other 95% ?

Not being privy the costs of the Voyager fleet I'm not sure but I'd think that the purchase of them must have been paid off. But to give another example where surely we can agree that they've been paid several times over is Northern's still quite extensive fleet of Sprinters?

 

[A0]

It’s notable that the people who moan about costs only seem to care about staffing costs…

The vast majority of the trains in use on the national network now are post privatisation. So any claims about "still paying for BR stock" are about an increasingly small minority of units in use - and the next cull of BR era stock is already taking place as the Mk3 EMUs are withdrawn. I would expect all bar the Scotrail HSTs to disappear in the next year or so - driven by a reshuffle caused by the new EMR fleet arriving and the 222s seeking new homes.

 

[yorksrob]

But *NOT* by reducing fares wholesale - you want as many paying as much as possible.

So if you have 150 passengers paying £ 5, you get the same revenue if you only have 75 passengers paying £ 10.

And if, as you keep claiming, the trains are full and standing, that actually suggests there *is* the demand and actually you *don't* need to cut the prices and can probably go the other way.

== Doublepost prevention - post automatically merged: 20 May 2022 ==



Your evidence that they have " been paid for several times over" is where ? (I'll wait).

Well, if a carriage costs around £1.5m to build, and leasing costs are around £130k a year, that makes £5.2m leasing costs over a 40 year lifespan.

Those rough figures might be out of date and on the low side now.

 

[Peter Sarf]

No - some journeys won't be made. Some will be made by bus.

If you don't have a car and you want to go to London for the day and decide the train fare is too much, you might go by coach, you might not bother, you might go somewhere else. It's not as binary as you make it out to be.

I try to err on the side of ecology but not to the point of risking life without a car.

For example I make regular trips from Croydon to Cardiff to visit family for the past ten years, usually two of us travelling but not always on the same dates. We have always favoured the coach as cheapest with a bus then train from Croydon to Victoria (made even cheaper recently as we now both have over 60 Oyster). Never been by rail as I consider it too costly and as soon as engineering works appear the journey is quicker by coach. I will drive if we have a lot of luggage but that is 5% or less of the trips.

For trips out and about with fellow enthusiasts the use of rail has declined. For a start two of us in the car is cheaper than rail. Go back 20 years and I used the trains for long distance travel more but I think that was due to the offers available to fill the trains at the beginning and end of the summer timetable. And we have a trip Euston - Creewe - Manchester - Leeds - Kings Cross on the back of the recent sale. Granted we often use the trains into central London - driving is just not feasible for that.

A nail in the railways coffin is the stupidity that charges passengers full rail fare during engineering blockades. The replacement coach often makes the journey slower than a direct scheduled coach. It is as though the railways expect passengers/customers to believe the railways did not know it was going to happen !. The replacement coach often does not allow pushchairs etc. It was a series of very late returns to London back in the 1990s that drove us to use our cars. One time we were deposited on the Euston Road at around 2am more or less opposite the site of what is now the new library this was on a replacement for a service to Kings Cross. No staff to help us out and many people could not work out where Kings Cross was. There were vulnerable people left on the pavement in a borderline red light district. Some of my enthusiast friends have nothing but contempt for the railway services.

But costs *can* be controlled - the biggest cost on the rail network is going to be staffing - so another look at OMO, running 2 tph rather than 3 or 4 reduces the number of crew needed, reducing ticket offices (which is being looked at and TFL have already done this on the Underground), not running the "once a day" extension to some random destination (again some of these have been done e.g. EMR running to Leeds - others which could be looked at include LNER running north of Edinburgh for example), reduce the number of "duplicate" services, reduce on-board catering where it is little used - the list goes on.

I do sometimes wonder if the railways are in the real world. I don't like to see erosion of jobs but we cannot expect a subsidy to pay for unnecessary jobs - *IF* they are unnecessary. The irony is that the public paying for this possibly important "safety" are mainly travelling by car so do not see any benefit from that safety. Then a train cancelled due to lack of a guard just sends customers to their cars. We then have to ask - what price safety ?.

Turning it the other way, what would be the effect of a 10% rise on all ticket prices ?

If, for example it led to a 2% drop in use but an 8% increase in revenue, that would actually improve the railway network's financial position.

That is a dangerous approach if it leads to steadily increasing prices and an ever declining user base. But you have a point and I seem to recall that since privatisation the railways carry more passengers BUT at a greater subsidy from the government. I do not know whether this subsidy is higher per passenger mile though ?.

 

[yorksrob]

The vast majority of the trains in use on the national network now are post privatisation. So any claims about "still paying for BR stock" are about an increasingly small minority of units in use - and the next cull of BR era stock is already taking place as the Mk3 EMUs are withdrawn. I would expect all bar the Scotrail HSTs to disappear in the next year or so - driven by a reshuffle caused by the new EMR fleet arriving and the 222s seeking new homes.

That's an irrelevant point. A train carriage built at today's prices using today's system will still be being leased in forty years time at forty years time prices. That will still amount to considerably more than the cost of the train.

Thinking about it, your average late BR carriage had a good few years not being subject to leasing costs, so will likely come in at less cost overall. Modem trains will be subject to leasing costs throughout the whole of their lifespan, so will end up costing even more, comparatively speaking.

 

[A0]

That's an irrelevant point. A train carriage built at today's prices using today's system will still be being leased in forty years time at forty years time prices. That will still amount to considerably more than the cost of the train.

Thinking about it, your average late BR carriage had a good few years not being subject to leasing costs, so will likely come in at less cost overall. Modem trains will be subject to leasing costs throughout the whole of their lifespan, so will end up costing even more, comparatively speaking.

You're assuming the current crop of rolling stock will be in use in 40 years.

That's a dangerous assumption - unless the leasing costs on 30+year old stock are peanuts, then most operators will simply sign up leases on newer units - it's not dissimilar to the use of PCPs for buying cars - people are replacing their cars at much younger ages than they used to - go back 20 years and it tended to be company car drivers who got a new car every 3 years, private motorists who bought new tended to make them last longer.

== Doublepost prevention - post automatically merged: 20 May 2022 ==

That is a dangerous approach if it leads to steadily increasing prices and an ever declining user base. But you have a point and I seem to recall that since privatisation the railways carry more passengers BUT at a greater subsidy from the government. I do not know whether this subsidy is higher per passenger mile though ?.

The point about subsidy, which is often missed, is it includes large infrastructure projects e.g. Crossrail, HS2 etc.

This helpfully explains:

How much does the government subsidise the railways by? – Full Fact

The average rail ticket is 20% more expensive than it was in 1995, and government subsidies for the railways have also increased.

fullfact.org

"Net government support to the rail industry in Great Britain for 2017/18 was £6.4 billion, of which £2.1 billion was for HS2."

 

[yorksrob]

You're assuming the current crop of rolling stock will be in use in 40 years.

That's a dangerous assumption - unless the leasing costs on 30+year old stock are peanuts, then most operators will simply sign up leases on newer units - it's not dissimilar to the use of PCPs for buying cars - people are replacing their cars at much younger ages than they used to - go back 20 years and it tended to be company car drivers who got a new car every 3 years, private motorists who bought new tended to make them last longer.

Even if the stock only lasts for thirty years, your'e still looking at a substantial over-payment.

Even if we get new trains every ten years, if we're still paying the same leasing charge all the time, we're still not getting the savings benefit of using stock where the cost has been paid down.

 

[A0]

Even if the stock only lasts for thirty years, your'e still looking at a substantial over-payment.

Even if we get new trains every ten years, if we're still paying the same leasing charge all the time, we're still not getting the savings benefit of using stock where the cost has been paid down.

No - because you'd be having to borrow the money on which you'd be paying interest charges.

So you have the additional costs of borrowing to factor in. Additionally in 10 years time, if for any reason you don't need the asset you simply hand it back to the leasing company and your obligations end, whereas if you own the asset and you're writing it off over 20 years then you'll be having to write off half the value of the purchase which will still be on the books (assuming you're depreciating the assets on a straight line basis).

You also seem to think the ROSCOs got the rolling stock for free - which of course they didn't - the government received about £ 2.5bn for the privatisation of the ROSCOs. Roger Ford, no fan of privatisation wrote at the time: "“a good deal for the taxpayer. We have got rid of a fleet of trains, two thirds of which are geriatric, to the private sector for not a bad price”

[Source] BR's train fleet sold for £1.8bn”, The Times, 10 November 1995 [Roger Ford, then editor of Rail Privatisation News

https://researchbriefings.files.parliament.uk/documents/SN03146/SN03146.pdf

 

[yorksrob]

No - because you'd be having to borrow the money on which you'd be paying interest charges.

So you have the additional costs of borrowing to factor in. Additionally in 10 years time, if for any reason you don't need the asset you simply hand it back to the leasing company and your obligations end, whereas if you own the asset and you're writing it off over 20 years then you'll be having to write off half the value of the purchase which will still be on the books (assuming you're depreciating the assets on a straight line basis).

Really you ought to have a railway where the likelihood of writing off the stock after ten years is likely to be prevented (through cascades etc). Certainly such a practice would be highly wasteful in terms of resources and something to be avoided.

I don't know how quickly the government borrowing rate would allow train build to be paid off, but anything less than permanent leasing would be s bonus.

 

[A0]

Really you ought to have a railway where the likelihood of writing off the stock after ten years is likely to be prevented (through cascades etc). Certainly such a practice would be highly wasteful in terms of resources and something to be avoided.

Why ? On what basis have you decided that trains should last 40 years ?

As technology changes and demands change, so should the rolling stock. Just saying it should last 40 years because that was the number BR alighted on over half a century ago makes no sense.

 

[yorksrob]

Why ? On what basis have you decided that trains should last 40 years ?

As technology changes and demands change, so should the rolling stock. Just saying it should last 40 years because that was the number BR alighted on over half a century ago makes no sense.

Building a train entails a considerable amount of expense, resources and carbon. We should not be expending such resources frivolously. Additionally, if you spend your resources replacing trains every ten years, there will likely be little scope for strengthening services and increasing capacity.

Forty years is a perfectly reasonable length of life for most railway vehicles, as illustrated by the Southern Region over many decades.

More importantly, as a passenger, why would I want money spent frivolously replacing rolling stock every ten years that isn't life expired, when the money would be far better spent keeping my fares down ?

 

[RT4038]

Right, so what are you going to do? Cut wages or staff? Good luck with that, the unions will shut down the whole thing for months. Cut back services? We've got enough of that already (see Scotrail). Cut infrastructure costs? Maybe we could do that but the last time we tried cutting corners on infrastructure in the Railtrack era trains started derailing. Raise ticket costs even further? They're pretty ridiculous already.

I don't see where these big savings are coming from.

On the staff front - it is probably a combination of reducing the number of trains running (possibly by making those that are, longer) and bringing staff terms and conditions in line with similar non-rail industry jobs. Unions shut the who thing down for months? On the new leisure railway, is that going to be apocalyptic? - probably not. Taxpayers funds shouldn't be funding some of the current terms and conditions and productivity rates, which are out of step with those pertaining in outside employment. Cutting infrastructure costs would probably involve slowing secondary services down , removing track no longer needed due to service reductions etc I would think.

The railways don't have some kind of right to exist - funded no matter what. I know some railway employees and enthusiasts won't like this, but the industry has to work out how to remain relevant (or regain relevance) to the majority and keep costs in check relative to revenue. That does not necessarily mean being totally commercial, but there is no blank cheque, nor should there be. Fortunately there are many in the Industry who understand all too well the landscape unfolding, but there is no room for complacency.

As for achieving relevance, and keeping revenue/cost balance in check, look at the railways of Argentina, some of the Balkan States, South Africa and various others to see what happens when you don't.

 

[TUC]

Right, so what are you going to do? Cut wages or staff? Good luck with that, the unions will shut down the whole thing for months. Cut back services? We've got enough of that already (see Scotrail). Cut infrastructure costs? Maybe we could do that but the last time we tried cutting corners on infrastructure in the Railtrack era trains started derailing. Raise ticket costs even further? They're pretty ridiculous already.

I don't see where these big savings are coming from.

The railway need to go through the same modernisation processes as most other industries did decades ago. The very fact that outside London most peoole have alternatives to travelling by rail means that, even if it caused issues with the unions, people would just get on with travelling by other means. Although there are good reasons for subsidising some rail services, there is no reason why those subsidies should cost taxpayers more than they need to.

 

[RT4038]

Building a train entails a considerable amount of expense, resources and carbon. We should not be expending such resources frivolously. Additionally, if you spend your resources replacing trains every ten years, there will likely be little scope for strengthening services and increasing capacity.

Forty years is a perfectly reasonable length of life for most railway vehicles, as illustrated by the Southern Region over many decades.

More importantly, as a passenger, why would I want money spent frivolously replacing rolling stock every ten years that isn't life expired, when the money would be far better spent keeping my fares down ?

Not disagreeing with you, but I can't help but think of all those posters on this forum who are clamouring for replacement of the XC Voyagers now .......

 

[ar10642]

The railway need to go through the same modernisation processes as most other industries did decades ago. The very fact that outside London most peoole have alternatives to travelling by rail means that, even if it caused issues with the unions, people would just get on with travelling by other means.

Yes, they would. And they wouldn't come back.

 

[yorksrob]

On the staff front - it is probably a combination of reducing the number of trains running (possibly by making those that are, longer) and bringing staff terms and conditions in line with similar non-rail industry jobs. Unions shut the who thing down for months? On the new leisure railway, is that going to be apocalyptic? - probably not. Taxpayers funds shouldn't be funding some of the current terms and conditions and productivity rates, which are out of step with those pertaining in outside employment. Cutting infrastructure costs would probably involve slowing secondary services down , removing track no longer needed due to service reductions etc I would think.

The railways don't have some kind of right to exist - funded no matter what. I know some railway employees and enthusiasts won't like this, but the industry has to work out how to remain relevant (or regain relevance) to the majority and keep costs in check relative to revenue. That does not necessarily mean being totally commercial, but there is no blank cheque, nor should there be. Fortunately there are many in the Industry who understand all too well the landscape unfolding, but there is no room for complacency.

As for achieving relevance, and keeping revenue/cost balance in check, look at the railways of Argentina, some of the Balkan States, South Africa and various others to see what happens when you don't.

Bums on seats is what keeps the railway relevant.

All the rest follows.

== Doublepost prevention - post automatically merged: 20 May 2022 ==

Not disagreeing with you, but I can't help but think of all those posters on this forum who are clamouring for replacement of the XC Voyagers now .......

They are "gas guzzlers".

Personally at this stage, I would want them replaced by nothing less than electrification. Failing that, a good refurb would suffice !

 

[ar10642]

On the staff front - it is probably a combination of reducing the number of trains running (possibly by making those that are, longer) and bringing staff terms and conditions in line with similar non-rail industry jobs. Unions shut the who thing down for months? On the new leisure railway, is that going to be apocalyptic? - probably not. Taxpayers funds shouldn't be funding some of the current terms and conditions and productivity rates, which are out of step with those pertaining in outside employment. Cutting infrastructure costs would probably involve slowing secondary services down , removing track no longer needed due to service reductions etc I would think.

The railways don't have some kind of right to exist - funded no matter what. I know some railway employees and enthusiasts won't like this, but the industry has to work out how to remain relevant (or regain relevance) to the majority and keep costs in check relative to revenue. That does not necessarily mean being totally commercial, but there is no blank cheque, nor should there be. Fortunately there are many in the Industry who understand all too well the landscape unfolding, but there is no room for complacency.

As for achieving relevance, and keeping revenue/cost balance in check, look at the railways of Argentina, some of the Balkan States, South Africa and various others to see what happens when you don't.

I've yet to see a version of this that doesn't make the service less useful and/or more expensive to use than it already is.

If the unions shut it down for months/years and reduce reliability even further I don't see why anyone would come back to it.

Sadly I think all of the above will happen and the railway will find itself irrelevant in the next few years. Nobody seems to know what we actually want it for. Either make it useful to as many people as possible (my preference) or get rid of it. Cutbacks in services, increased fares and protracted strikes are the worst of both worlds and doesn't make anyone happy.

 

[RT4038]

Bums on seats is what keeps the railway relevant.

All the rest follows.

I think it is little more more nuanced than that though. Not by being achieved at any cost though, and the same bums sitting more often (and making more and more discretionary journeys), are at a discount in the relevance stakes.

 

[A0]

Bums on seats is what keeps the railway relevant.

Wrong. The railways didn't come into existence to shift people around - that was a by product.

Shifting bulk freight was, and remains the railway's main reason for existing. Very few lines were built with passenger as the main demand, particularly outside the cities.

 

[RT4038]

I've yet to see a version of this that doesn't make the service less useful and/or more expensive to use than it already is.

If the unions shut it down for months/years and reduce reliability even further I don't see why anyone would come back to it.

Sadly I think all of the above will happen and the railway will find itself irrelevant in the next few years. Nobody seems to know what we actually want it for. Either make it useful to as many people as possible (my preference) or get rid of it. Cutbacks in services, increased fares and protracted strikes are the worst of both worlds and doesn't make anyone happy.

I never said it would, but the railway has no right to exist, nor a blank cheque. Making it as useful to as many people as possible has to be a goal, but not at any cost. The costs have to be sorted out first, and if that means cutbacks in services and protracted strikes to build a strong foundation then perhaps this has to be gone through first. Similar things have happened in many other industries before.

 

[A0]

Forty years is a perfectly reasonable length of life for most railway vehicles, as illustrated by the Southern Region over many decades.

Right, because the "Southern region" did nothing wrong - apart from recycling time expired rolling stock which lead to unnecessary deaths when such death traps were involved in accidents and has bequeathed to the rail network a prehistoric system of electrification which was dangerously unsafe a century ago.

In any other line of business you'd be condemning such practises, but since it's the rail network it gets a free pass.

 

[ar10642]

I never said it would, but the railway has no right to exist, nor a blank cheque. Making it as useful to as many people as possible has to be a goal, but not at any cost. The costs have to be sorted out first, and if that means cutbacks in services and protracted strikes to build a strong foundation then perhaps this has to be gone through first. Similar things have happened in many other industries before.

But the costs aren't going to be sorted without shutting loads of it down forever. Tinkering here and there surely won't make a meaningful difference.

 

[A0]

I never said it would, but the railway has no right to exist, nor a blank cheque. Making it as useful to as many people as possible has to be a goal, but not at any cost. The costs have to be sorted out first, and if that means cutbacks in services and protracted strikes to build a strong foundation then perhaps this has to be gone through first. Similar things have happened in many other industries before.

So want a like button.. all of the above every day of the week and twice on Sundays.

 

[ar10642]

So want a like button.. all of the above every day of the week and twice on Sundays.

It basically means closing most of it. It's never going to make money or break even. Around my way I'd imagine only the Brighton mainline would still exist.

 

[43066]

The vast majority of the trains in use on the national network now are post privatisation. So any claims about "still paying for BR stock" are about an increasingly small minority of units in use - and the next cull of BR era stock is already taking place as the Mk3 EMUs are withdrawn. I would expect all bar the Scotrail HSTs to disappear in the next year or so - driven by a reshuffle caused by the new EMR fleet arriving and the 222s seeking new homes.

But leasing costs are significant, and ROSCOs have certainly made arguably excessive profits for years - another legacy of privatisation. I just find it a little strange that you’re very quick to jump on staff costs appear wiling to defend ROSCOs.

Shifting bulk freight was, and remains the railway's main reason for existing.

This is just factually incorrect.

Taxpayers funds shouldn't be funding some of the current terms and conditions and productivity rates, which are out of step with those pertaining in outside employment.

Specifically which Ts and Cs? I suspect you have no real knowledge or understanding of either Ts and Cs or productivity and are just parroting something you’ve read in the Daily Mail.

 

[A0]

It basically means closing most of it. It's never going to make money or break even. Around my way I'd imagine only the Brighton mainline would still exist.

No it doesn't.

It means not pouring money in like there's no tomorrow and allowing costs to escalate.

Running a half empty DMU around twice an hour should be replaced with an hourly service - which might not be full, but might be 3/4s full and running costs would be ~50% less.

Don't run silly once a day extensions to random destinations.

Maybe do as in France where many rural routes are covered by bus or coach (example Roscoff in Brittany which is also a ferry port).

 

[ar10642]

No it doesn't.

It means not pouring money in like there's no tomorrow and allowing costs to escalate.

Running a half empty DMU around twice an hour should be replaced with an hourly service - which might not be full, but might be 3/4s full and running costs would be ~50% less.

But it's also 50% less useful, so why would I bother with it, especially with today's sky high fares, and not just drive instead?

Don't run silly once a day extensions to random destinations.

How much money is not doing that going to save? I suspect hardly anything.

Maybe do as in France where many rural routes are covered by bus or coach (example Roscoff in Brittany which is also a ferry port).

That is just a closure.

 

[43066]

That is just a closure.

It’s hilarious how many supposed railway enthusiasts seem to want to close most of it down!

 

[A0]

But leasing costs are significant, and ROSCOs have certainly made arguably excessive profits for years - another legacy of privatisation. I just find it a little strange that you’re very quick to jump on staff costs appear wiling to defend ROSCOs.

Your evidence is where?

This is just factually incorrect.

Go and read up on the history of the railways and why they started out in places like Liverpool and Manchester or Stockton & Darlington - it wasn't about moving people.

Specifically which Ts and Cs? I suspect you have no real knowledge or understanding of either Ts and Cs or productivity and are just parroting something you’ve read in the Daily Mail.

Ah, the good old recourse from the Left when you don't have an argument - it's all lies in the Mail / Sun /Express. Try harder.

== Doublepost prevention - post automatically merged: 20 May 2022 ==

It’s hilarious how many supposed railway enthusiasts seem to want to close most of it down!

It's hilarious how the blinkered pro rail enthusiasts seem incapable of dealing in facts and prefer to misrepresent the posts of people they don't agree with.