UK Rail Passenger Numbers Discussion

[Trainbike46]

So I'm a bit lost here, is LNER losing the 225s a thing that is actually confirmed to be happening, or a thing that has been proposed by some (whether on this forum, or by the tax avoiders alliance) as a solution for reducing LNER costs?

 

[yorksrob]

So I'm a bit lost here, is LNER losing the 225s a thing that is actually confirmed to be happening, or a thing that has been proposed by some (whether on this forum, or by the tax avoiders alliance) as a solution for reducing LNER costs?

It's something that seems possible, given what's gone on in other TOC's.
May this year seems to be a bit of a tipping point when lots of cuts are likely to come on line.

 

[The Ham]

It is fairly clear from various comments that usage changes are uneven, some commuter lines have lost third, some like LNER are close to 2019, some leisure routes are up, and there are a tiny number of new bits and services like Crossrail core.

It is also clear that some operators are running similar timetables to 2019 (LNER, GWR etc) and others seem to have thinned out service levels. Although why some operators have retained or trained enough staff, and other operators have incompetent HR Departments, and are short of staff, is for another thread.

But ultimately this is about bums on seats, fare revenue, if some operators are filling their trains (peak, off-peak, weekends) and others aren't then clearly some are going to need much bigger subsidies to fill the revenue hole than others. No one wants to see 90% empty trains wasting money, whilst passengers are struggling to squeeze on in a different area. At the moment the system is broken it cannot match supply and demand

The DfT has been very ham fisted, it seems to have requested cuts across the network, rather than saying these are the subsidies per Operator. Should be saying the inefficient (or costly per person Km) ones need to cut. The good ones can stay (or grow where there is crowding. For clarity I am talking about the bulk of the network, not the sparse rural services that have the social subsidy which is a special case.

If figures were available by type of service, or seat occupancy percentages by operators then would be a much more productive debate.

Indeed, hence my comment that where there's are to be cuts they should be based on data (i.e. there can be cuts, something that those who want cuts and I agree on, but not at the expense of services where they are busy, which is generally the view of many who want the railways to do well).

But of course if that data was available there would be lot of pressure to fire the underperforming operators, and encourage the good operators to take over services of the subsidy heavy companies.

Even with the data available I'd argue that TPE, XC, and Avanti have a lot to do. However what that looks like for (say) XC depends on if the 64% of fleet km's are matched to the 68% of passenger km's or if the passenger km's are as good as we'll get given the limitations on the fleet km's (i.e. if there was more capacity available how much could be added before the returns from that extra capacity start to diminish to the extent that it stops generating more income than it costs to run the services).

== Doublepost prevention - post automatically merged: 9 Jan 2023 ==

Some back of the envelope calculations:

The Govt subsidy has leapt, was £4.7 bn 2018-19, then £6.8 bn the following year, fast forward to 2022-23, the estimated subsidy if £11bn.
If fare revenue is added to Govt subsidy for each to give a figure of house-keeping for the railway, 2018-2019 was £15.7 bn, the the following year £17.7 bn, then £20bn for 2022-23.
If passenger journeys rise to a record 2 bn, for 2023-2024, then fare revenue would be £12bn leaving an prediction of an £8bn Govt subsidy to square the account to £20bn
£8bn divided by 2bn passenger journeys still leave a subsidy of £4 per journey.

What is an acceptable figure for the subsidy per journey to 1) the puiblic, 2) the Chancellor, the MPs ?

In answer to the last question it's likely to be anything from -£8 to £8 deepening on who is answering.

The one thing that's worth bearing in mind is that the loss of a £2 train ticket (1 person) results in a very different drop compared to say a £50 train ticket (1 person).

The fact that Northern are down by 18% on their passenger km's is probably have a much smaller impact on as than XC being down by 32%, probably by more than double (the approximate difference between the reduction), as not only are their train tickets per km likely to be higher there was also more km's travelled on XC than Northern.

As such whilst your maths is correct, the level of subsidy could change significantly depending on which TOC's can grow their passenger numbers.

 

[greyman42]

It's something that seems possible, given what's gone on in other TOC's.
May this year seems to be a bit of a tipping point when lots of cuts are likely to come on line.

What cuts?

 

[The Ham]

What cuts?

Few have been announced, but DfT want cost savings. As an example GWR are getting rid of their Castles and their 769's.

Chances are XC will see their HST's go too.

 

[ar10642]

What cuts?

There are clearly going to be many cuts across the whole public sector in the near future and I doubt the railway will escape them.

 

[gabrielhj07]

What cuts?

Cuts to do with the fact that the budget has remained constant while inflation has risen.

 

[dk1]

Few have been announced, but DfT want cost savings. As an example GWR are getting rid of their Castles and their 769's.

Chances are XC will see their HST's go too.

To be fair ASLEF want the HSTs gone sooner rather than later & the 769s were a disaster from the outset.

 

[Robertj21a]

Much of this thread lately keeps referring to cuts, subsidies or passenger numbers.

Surely, the issue that should take absolute priority has to be the *income* from passengers?.

If we're filling trains with leisure travellers but have lost the lucrative season ticket holders there must be a massive shortage of income?

 

[yorksrob]

Much of this thread lately keeps referring to cuts, subsidies or passenger numbers.

Surely, the issue that should take absolute priority has to be the *income* from passengers?.

If we're filling trains with leisure travellers but have lost the lucrative season ticket holders there must be a massive shortage of income?

Possibly not as large as at first thought.

Season ticket holders are up front "guaranteed" income, but the individual journeys are heavily discounted

 

[The Ham]

Much of this thread lately keeps referring to cuts, subsidies or passenger numbers.

Surely, the issue that should take absolute priority has to be the *income* from passengers?.

If we're filling trains with leisure travellers but have lost the lucrative season ticket holders there must be a massive shortage of income?

Whilst there's no doubt that season ticket income is down, there's an element of does it matter if passenger type a is paying 25p/km or passenger type b is paying 25p/km.

Where it matters is what the per km rate changes and whilst lesure travel is more price sensitive or would be interesting to see actually how much of a difference they pay compared to other ticket types.

However the other thing to remember is that the 3 day a week tickets are actually more costly than the annual tickets per km. As such if you have 5 people buying 3 day a week tickets vs 3 people buying 5 day a week tickets the total income from the first group is more than the second, even though the second each pay less and the total number of passenger trips is the same.

The nuisances of this and that such data isn't available in large enough data sets which are publicly available that we have to compare other data (such as passenger numbers or passenger km's) to get a rough idea of what is likely to be happening.

 

[JamesT]

Whilst there's no doubt that season ticket income is down, there's an element of does it matter if passenger type a is paying 25p/km or passenger type b is paying 25p/km.

Where it matters is what the per km rate changes and whilst lesure travel is more price sensitive or would be interesting to see actually how much of a difference they pay compared to other ticket types.

However the other thing to remember is that the 3 day a week tickets are actually more costly than the annual tickets per km. As such if you have 5 people buying 3 day a week tickets vs 3 people buying 5 day a week tickets the total income from the first group is more than the second, even though the second each pay less and the total number of passenger trips is the same.

The nuisances of this and that such data isn't available in large enough data sets which are publicly available that we have to compare other data (such as passenger numbers or passenger km's) to get a rough idea of what is likely to be happening.

Don't we have that rough idea already as revenue is down compared to passenger numbers, from the currently published data?

 

[tbtc]

Much of this thread lately keeps referring to cuts, subsidies or passenger numbers.

Surely, the issue that should take absolute priority has to be the *income* from passengers?.

If we're filling trains with leisure travellers but have lost the lucrative season ticket holders there must be a massive shortage of income?

Post 264 on this thread lays out the depressing reality, a billion pounds a year in “business” revenue lost and a billion and a half pounds a year in “commuter” revenue too… neither of which are realistically going to bounce back any time soon (there’ll be tinkering at the edges, sure, some individuals will yearn for office life, but we’ve had roughly three years of “Working from Home” and the patterns/ numbers look to have settled down)

Leisure traffic has “bounced back” but only to the levels it was expected to be, so it’s a fallacy to say that income from the leisure market has made up for any shortfall

We could pretend that everything will be okay, that the figures will look better once the strikes are resolved, that the government will be more bothered about “passenger kms” than actual revenue, that we can just keep highlighting the one small TOC that’s doing better than expected* and hope that nobody questions the twenty that aren’t, maybe kid ourselves that those sat at home are dying to swap their comfortable life for spending a couple of hours a day on commuter trains… but I think that we’ll cope with the inevitable cuts if we are at least realistic now about what that two and a half billion pounds a year in lost revenue is going to mean

* - 2019 was four years ago now, and passenger numbers were assumed to have grown each year since then, i.e. in 2019 they thought that we’d have an extra “20%” of passengers by 2023, so whilst beating 2019 figures is great, it’s possible that it’s still below where things were expected to be

 

[yorksrob]

Post 264 on this thread lays out the depressing reality, a billion pounds a year in “business” revenue lost and a billion and a half pounds a year in “commuter” revenue too… neither of which are realistically going to bounce back any time soon (there’ll be tinkering at the edges, sure, some individuals will yearn for office life, but we’ve had roughly three years of “Working from Home” and the patterns/ numbers look to have settled down)

Leisure traffic has “bounced back” but only to the levels it was expected to be, so it’s a fallacy to say that income from the leisure market has made up for any shortfall

We could pretend that everything will be okay, that the figures will look better once the strikes are resolved, that the government will be more bothered about “passenger kms” than actual revenue, that we can just keep highlighting the one small TOC that’s doing better than expected* and hope that nobody questions the twenty that aren’t, maybe kid ourselves that those sat at home are dying to swap their comfortable life for spending a couple of hours a day on commuter trains… but I think that we’ll cope with the inevitable cuts if we are at least realistic now about what that two and a half billion pounds a year in lost revenue is going to mean

* - 2019 was four years ago now, and passenger numbers were assumed to have grown each year since then, i.e. in 2019 they thought that we’d have an extra “20%” of passengers by 2023, so whilst beating 2019 figures is great, it’s possible that it’s still below where things were expected to be

The reality is that the system would have struggled to cope with 20% extra passengers without considerable investment anyway.

 

[The Ham]

Don't we have that rough idea already as revenue is down compared to passenger numbers, from the currently published data?

Yes, although as that's based on the last 12 months it's a much worse picture than is likely to be the case going forwards.

The last 12 months includes October to December 2021, and so includes a time when (as an example) Christmas parties were being cancelled due to Covid.

At the same time car use was at 85% of pre Covid levels, and so should we plan our future road building program on data which includes this? (Clearly the answer is no, so why should this be the case for the railways?)

* - 2019 was four years ago now, and passenger numbers were assumed to have grown each year since then, i.e. in 2019 they thought that we’d have an extra “20%” of passengers by 2023, so whilst beating 2019 figures is great, it’s possible that it’s still below where things were expected to be

20% of growth over 4 years is 4.7% year on year, rail hasn't been seeing that level of growth for the last few years pre Covid, and whilst I understand your point a more realistic growth figure is likely to be circa 12.5% (3% year on year), although that would likely have required a significant level of investment

I didn’t think anyone is suggesting that lousy service is nothing to do with reduced passenger / revenue numbers on some TOCs. That clearly is a factor.

However it is not the only factor.

It is simply not the case that peoples travel habits have not changed, because they very definitely have. Business travel is well under half what it was Pre covid - that alone is a billion pound gap each year. Commuting is also only a little more than half what it was, and that’s another £1.5bn gap. It is great that leisure has come back strongly, particularly on short distance and particularly in and to London, but it is only making up 20% of the shortfall of the other two. And, in fact, the leisure market is simply back on the growth line that was forecast Pre covid.

Even if Avanti, TPE and Cross Country were running perfect services, it’s not going to bring back the full trains in the peak full of high yield business and commuter passengers.

Whilst I don't doubt the figures, I assume these are based on the last 12 months (as indicated at the start of this post, so Q3 2021/22 to Q2 2022/23), in which case even if we see zero additional growth between Q2 and Q4 the 2022/23 year would likely see a much smaller gap in income compared to these current numbers.

That's not too say that there's not a need for some cuts or some changes, however probably not as much as the circa 10% of 2019 total costs of the railways (that being £25bn) which these current numbers (£1bn+£1.5bn=£2.5bn) suggest.

Arguably if we made those sorts of cuts without being aware of the current rail use numbers we could end up making cuts which are detrimental to contrary as we would have cut further than we actually justified.

 

[Bald Rick]

Whilst I don't doubt the figures, I assume these are based on the last 12 months (as indicated at the start of this post, so Q3 2021/22 to Q2 2022/23),

No, they are based on current figures (strike excluded) extrapolated.

== Doublepost prevention - post automatically merged: 10 Jan 2023 ==

we could end up making cuts which are detrimental to contrary as we would have cut further than we actually justified.

Any cuts will be detrimental to someone. The trick is to make them as detrimental to as few people as possible.

 

[tbtc]

The reality is that the system would have struggled to cope with 20% extra passengers without considerable investment anyway.

There were some areas where we ordered much longer trains to accommodate expected growth, and we are still going to have these various fleets coming into service (some of which are heavily delayed but should have been in squadron service by now - the drop in passenger numbers has avoided some of the embarrassment for manufacturers delivering stock late, since we’re not urgently waiting for it now)

Whether we now need all of those units like 720s is a different story, they were ordered pre-Covid at a time when commuters from places like Essex needed more capacity

The 710s seem like a more solid investment given how shorter distance travel in London is faring

There’s obviously Crossrail too, that would have been expected to add a few million passengers

We’ve also recently finished various infrastructure improvements intended to increase capacity (London Bridge etc)

Not so much growth expected here in South Yorkshire, admittedly!

20% of growth over 4 years is 4.7% year on year, rail hasn't been seeing that level of growth for the last few years pre Covid, and whilst I understand your point a more realistic growth figure is likely to be circa 12.5% (3% year on year), although that would likely have required a significant level of investment

Hence putting the “20%” in quotation marks, I didn’t know what the cumulative increase was expected to be over those four years, I’m just making the point that “getting the same number as 2019” needs to be seen in the context of 2019’s expectation that we’d be seeing much higher figures by 2023 (hence the various capacity improvements placed during that period, mentioned above)

 

[The Ham]

No, they are based on current figures (strike excluded) extrapolated.

== Doublepost prevention - post automatically merged: 10 Jan 2023 ==

Thanks for the confirmation, it's good to know (even if it's not the answer is personally like).

Any cuts will be detrimental to someone. The trick is to make them as detrimental to as few people as possible.

Indeed.

 

[Xavi]

DfT usage figures updated today and available here with a graphical chart and 4th Order Polynomial trend / forecast below.

90%+ of pre-COVID journeys likely once the strikes end. Give the TOCs an incentive to grow revenue (simple contract addendum) and I believe the £2bn gap can be reduced. At a minimum, I would ditch the current Advance fare structure and give freedom on pricing pre-booked e-tickets on all routes.

 

[12LDA28C]

DfT usage figures updated today and available here with a graphical chart and 4th Order Polynomial trend / forecast below.

90%+ of pre-COVID journeys likely once the strikes end. Give the TOCs an incentive to grow revenue (simple contract addendum) and I believe the £2bn gap can be reduced. At a minimum, I would ditch the current Advance fare structure and give freedom on pricing pre-booked e-tickets on all routes.

Where exactly is the incentive for TOCs to grow revenue? The ability to do this is, in many cases literally being prevented by the DfT, eg refusing TOC requests to recruit more staff in order to run a more robust and reliable service.

It's very apparent that the Government isn't interested in growing revenue, merely being hell-bent on cutting costs, often at the expense of the travelling public.

 

[Trainbike46]

Where exactly is the incentive for TOCs to grow revenue? The ability to do this is, in many cases literally being prevented by the DfT, eg refusing TOC requests to recruit more staff in order to run a more robust and reliable service.

It's very apparent that the Government isn't interested in growing revenue, merely being hell-bent on cutting costs, often at the expense of the travelling public.

The way I read it, Xavi was proposing changes to the contract with TOCs to incentivise them to grow revenue, as that incentive isn't currently there

 

[Xavi]

The way I read it, Xavi was proposing changes to the contract with TOCs to incentivise them to grow revenue, as that incentive isn't currently there

Yes, that’s correct. A rather significant oversight when the original contracts were drafted. Can be corrected by addendum and would be welcomed by TOCs.

 

[12LDA28C]

Yes, that’s correct. A rather significant oversight when the original contracts were drafted. Can be corrected by addendum and would be welcomed by TOCs.

What makes you think the DfT are interested in growing revenue? That would require investment which the Government won't sanction.

 

[paul1609]

What makes you think the DfT are interested in growing revenue? That would require investment which the Government won't sanction.

Surely all the TOCs are making a stonking loss on the services they already provide? Ive seen it suggested on here that LNER a niche provider of Express regional services from London to Yorkshire, Tyneside and Scotland is one of the best performing in passenger numbers but its income per passenger/km is down by 30%
It would seem to me that its inevitable that more revenue=more services=more subsidy.
Personally as a taxpayer if we have available funds Id rather it spent on the NHS, education etc. Indeed Id rather that existing money was moved away from the rail industry to support the NHS etc.

 

[Bald Rick]

DfT usage figures updated today and available here with a graphical chart and 4th Order Polynomial trend / forecast below.

90%+ of pre-COVID journeys likely once the strikes end. Give the TOCs an incentive to grow revenue (simple contract addendum) and I believe the £2bn gap can be reduced. At a minimum, I would ditch the current Advance fare structure and give freedom on pricing pre-booked e-tickets on all routes.

View attachment 126817

The upswing in the trend forecast line is intriguing, as that appears to happen from now, and to my eye is not supported by any of the trend data.

 

[12LDA28C]

Personally as a taxpayer if we have available funds Id rather it spent on the NHS, education etc. Indeed Id rather that existing money was moved away from the rail industry to support the NHS etc.

I certainly wouldn't. You're aware that the NHS is hugely bloated and inefficient and costs the UK taxpayer well over £100 Billion every single year? It makes the amount spent on rail subsidy and even HS2 look like loose change. Diverting even more money towards the NHS would only make things worse.

 

[yorksrob]

Surely all the TOCs are making a stonking loss on the services they already provide? Ive seen it suggested on here that LNER a niche provider of Express regional services from London to Yorkshire, Tyneside and Scotland is one of the best performing in passenger numbers but its income per passenger/km is down by 30%
It would seem to me that its inevitable that more revenue=more services=more subsidy.
Personally as a taxpayer if we have available funds Id rather it spent on the NHS, education etc. Indeed Id rather that existing money was moved away from the rail industry to support the NHS etc.

As a taxpayer, I'd rather my taxes were spent on providing a railway system that works. I'm not convinced that primary and secondary education needs vast additional sums spent on it. The educational system seems to be awash with new schools and tech, certainly compared to the 1980's when crumbling Victorian buildings were the norm.

 

[Xavi]

The upswing in the trend forecast line is intriguing, as that appears to happen from now, and to my eye is not supported by any of the trend data.

Yes, and in anticipation of such observations, I quoted the exact model. This very moderate forecast uptick is due to strikes impacting the previous trend, hence the statement 'once the strikes end'.

== Doublepost prevention - post automatically merged: 11 Jan 2023 ==

Surely all the TOCs are making a stonking loss on the services they already provide? Ive seen it suggested on here that LNER a niche provider of Express regional services from London to Yorkshire, Tyneside and Scotland is one of the best performing in passenger numbers but its income per passenger/km is down by 30%
It would seem to me that its inevitable that more revenue=more services=more subsidy.
Personally as a taxpayer if we have available funds Id rather it spent on the NHS, education etc. Indeed Id rather that existing money was moved away from the rail industry to support the NHS etc.

How much does the UK economy (including tax revenues) lose every day there are rail strikes? Not to forget the taxes returned to government from PAYE and NICs.

 

[Robertj21a]

Post 264 on this thread lays out the depressing reality, a billion pounds a year in “business” revenue lost and a billion and a half pounds a year in “commuter” revenue too… neither of which are realistically going to bounce back any time soon (there’ll be tinkering at the edges, sure, some individuals will yearn for office life, but we’ve had roughly three years of “Working from Home” and the patterns/ numbers look to have settled down)

Leisure traffic has “bounced back” but only to the levels it was expected to be, so it’s a fallacy to say that income from the leisure market has made up for any shortfall

We could pretend that everything will be okay, that the figures will look better once the strikes are resolved, that the government will be more bothered about “passenger kms” than actual revenue, that we can just keep highlighting the one small TOC that’s doing better than expected* and hope that nobody questions the twenty that aren’t, maybe kid ourselves that those sat at home are dying to swap their comfortable life for spending a couple of hours a day on commuter trains… but I think that we’ll cope with the inevitable cuts if we are at least realistic now about what that two and a half billion pounds a year in lost revenue is going to mean

* - 2019 was four years ago now, and passenger numbers were assumed to have grown each year since then, i.e. in 2019 they thought that we’d have an extra “20%” of passengers by 2023, so whilst beating 2019 figures is great, it’s possible that it’s still below where things were expected to be

Excellent, many thanks. I thought I'd seen some relevant figures, but hadn't gone right back to post 264 ..!!
That's a lot of income lost and, whatever gloss others may want to put on it, seems unlikely to be significantly improved.
Some realism looks overdue if we are to find an effective way forward.

 

[gabrielhj07]

Surely all the TOCs are making a stonking loss on the services they already provide?

The TOCs are losing the DfTs money for them, not so themselves.