Discussion About Excessively High Admin Fees

[Haywain]

The suggestion was that paying a share of "operational costs" can be justified up to any amount.

So, if those words had not been used would there still be a problem for you with the amount requested? Because it appears that if they had simply referred to the 'costs incurred' you might not have anything to object to.

 

[HurdyGurdy]

So, if those words had not been used would there still be a problem for you with the amount requested?

Both the words used and the amount requested suggest that SWR is seeking more than "costs incurred" in simply investigating an incident, or series of incidents, to the point that a prosecution could be brought.

@Bletchleyite has made the argument that it's reasonable to require an offender to pay, in addition to those costs and the fare(s) avoided, a proportion of the cost of non-payment of fares by others, including the cost of having to check tickets. Is that what SWR means when it describes "operational costs" as part of the requested amount?

== Doublepost prevention - post automatically merged: 6 Oct 2023 ==

You use terms such as “justified” and “legitimate” quite loosely. Are you attempting to make a case around the legality of TOC admin fees or their morality? As that will make a difference to how I and others respond.

I'm not making a case. I'm responding to the assertion that in requesting an amount in settlement of non-payment of a fare, a company can ask for any sum it likes to identify as "costs".

If there were no associated criminal offences, a company seeking to recover losses from fare evasion would not be able to receive any sum it liked. An out of court settlement would be limited by what a court would be likely to award.

It has been suggested, but would it be legitimate (legal) for a company seek far more than a court would be likely to award by using the implied threat of prosecution?

 

[island]

If there were no associated criminal offences, a company seeking to recover losses from fare evasion would not be able to receive any sum it liked. An out of court settlement would be limited by what a court would be likely to award.

Well, the passenger might be willing to pay a modest amount to not have to give up a day to attend court, but I agree that this would be likely to lower settlements.

It has been suggested, but would it be legitimate (legal) for a company seek far more than a court would be likely to award by using the implied threat of prosecution?

I accept there could be an upper limit above which a TOC would be at risk of prosecution for blackmail, but I do not propose to speculate as to where precisely that is.

 

[HurdyGurdy]

I accept there could be an upper limit above which a TOC would be at risk of prosecution for blackmail, but I do not propose to speculate as to where precisely that is.

The upper limit would be where the demand for payment became "unwarranted". The Crown Prosecution Service has guidance.

 

[Haywain]

The upper limit would be where the demand for payment became "unwarranted". The Crown Prosecution Service has guidance.

Even then, you are assuming that offering an alternative to prosecution would be seen as a "demand with menaces".

 

[HurdyGurdy]

Even then, you are assuming that offering an alternative to prosecution would be seen as a "demand with menaces".

It's not for me to assume anything, but for a prosecutor and ultimately a jury to decide on the facts of the individual case. A jury could well decide that a TOC demanding 'ten grand or we prosecute', as @Bletchleyite has suggested, is guilty of blackmail. "Manaces" could be any credible threat. As the CPS guidance (my bold) says:

The fact that the action threatened may be legal or even morally desirable does not prevent it from being unwarranted. For instance, a demand for money accompanied by a threat to reveal to the victim's employer that they have been stealing from the company will almost certainly be blackmail, although most would consider that telling the employer is the right thing to do. It is the use of the threat to gain money which will usually lead to it being considered unwarranted.

 

[swt_passenger]

In the original case that this discussion was spun out of, the unusually high admin fee has since been reduced to a more normal £120. I thought I’d repeat that here in case this thread is read without reference to the source discussion.

 

[75A]

IMO the Admin fee should be at least doubled, to try and discourage the offenders.

 

[Bletchleyite]

IMO the Admin fee should be at least doubled, to try and discourage the offenders.

An admin fee has to realistically reflect the administration involved in the case. A TOC could offer what they liked as a settlement of course, even £10K or more, but people would then simply choose to go to Court, where the Court would impose a fine and the TOC would only be able to claim reasonable costs, not an arbitrary figure.

 

[Hadders]

IMO the Admin fee should be at least doubled, to try and discourage the offenders.

An out of court settlement should seek to put the train company back to the position it would’ve been in had the incident not occurred.

So a fee representing the cost of the fares avoided is ok, and an admin fee is ok as long as it genuinely reflects the cost of investigating and administering the case.

The figures shouldn’t just be made up, but there is scope for subjectivity. For example:

Charging the full Anytime Single Fare
No credit for incorrect ticket used
Cost of staff time to investigate the case but you could add in a provision for management time, office accommodation etc

 

[John R]

It should be relatively straightforward to evidence the fully loaded cost of running the relevant team (it seems as though in many cases it is outsourced to TIL, which I presume already has some charging mechanism for the TOCs that use it), and from that an approximate cost per case, with some variation for different types of cost, to reflect the relative complexity.

By fully loaded, I would include all those costs that a business would incur, staffing, premises, IT, the share of associated shared services such as Finance. I could easily imagine you'd quickly get to £150 for even a relatively straightforward case, given the need to communicate in a manual way with those being investigated. (ie, it can't all be done by computers.)

 

[fandroid]

The figures shouldn’t just be made up, but there is scope for subjectivity. For example:

Charging the full Anytime Single Fare
No credit for incorrect ticket used
Cost of staff time to investigate the case but you could add in a provision for management time, office accommodation etc

There are plenty of cases where a genuine error has been made, and the circumstances do not allow a Penalty Fare to be applied. For those cases, some would say that both charging the Anytime fare, unreduced by a valid Railcard and/or no credit for a ticket already purchased is inappropriate. A lot of store is placed in the public mind on "fairness" when officialdom deal with Joe Public. It would be a good thing if the railway tried to fit in with this requirement.

One area where some moderation could be applied is when a valid Railcard is held, and the offence looks more like a mistake than fraud. Ownership of one is an indication of a good customer for the railway who has already paid up front, and some recognition of that ought to be appropriate

 

[Hadders]

There are plenty of cases where a genuine error has been made, and the circumstances do not allow a Penalty Fare to be applied. For those cases, some would say that both charging the Anytime fare, unreduced by a valid Railcard and/or no credit for a ticket already purchased is inappropriate. A lot of store is placed in the public mind on "fairness" when officialdom deal with Joe Public. It would be a good thing if the railway tried to fit in with this requirement.

There are examples of this. We've seen cases where a lower admin fee is charged in 'simpler' cases and we ften see cases where the outstanding fare is less than I would expect, in some cases charging an off-peak fare or only requesting compensation for the single case rather than looking at the full journey history.

One area where some moderation could be applied is when a valid Railcard is held, and the offence looks more like a mistake than fraud. Ownership of one is an indication of a good customer for the railway who has already paid up front, and some recognition of that ought to be appropriate

I'm not sure what you mean by this. There is already a procedure for passengers who forget to carry a railcard on their journey. If you mean someone travelling at an invalid time then I think care needs to be taken because online journey planners won't sell a railcard discounted ticket for an invalid train.

 

[AdamWW]

I'm not sure what you mean by this. There is already a procedure for passengers who forget to carry a railcard on their journey. If you mean someone travelling at an invalid time then I think care needs to be taken because online journey planners won't sell a railcard discounted ticket for an invalid train.

No but they will sell you an anytime ticket for a valid train and tell you that there are no time restrictions on what train you can then use the ticket on.

 

[anothertyke]

I presume part of the admin fee is the time of the RPOs themselves in dealing with irregularities? I was on a train between Manchester and Liverpool last week. The RPO got on at Manchester and reached coach B by Eccles. A couple of bays down she came to someone who couldn't find their railcard on their phone. It must have taken twenty minutes to deal with that case by which time she probably wouldn't have got round the five coach train before Lime St.