Transport Secretary backs Office of Rail and Road’s review of revenue protection practices

The Transport Secretary Heidi Alexander has accepted the recommendations from the Office of Rail and Road's (ORR)[1] review of train operators' revenue protection practices. Earlier this year the ORR released details of an in-depth review, commissioned by Government, which revealed the current system needs to work better for passengers, train operators and taxpayers alike. It found:

-significant inconsistency in approaches to revenue protection across the network, leading to very different outcomes for passengers -clear areas where better information would help passengers buy the right ticket, and where they need to understand their rights; plus what options they have if action is taken against them for suspected fare evasion -scope to improve fairness for passengers making honest mistakes, while helping the industry better address fare evasion, and deal with those who attempt to defraud the railway

Responding in a letter to operators, Heidi Alexander said: "Deliberate fare dodging undermines our railway. It drains much needed revenue and undercuts the trust of passengers who play by the rules. The Rail Delivery Group (RDG) has estimated annual revenue lost to fraud and ticketless travel is at least ?350 to ?400 million.

But the damage goes beyond the numbers. Each ticket barrier jumped dents confidence in the railway. While we carry out much needed wider rail reforms - changes that will require the patience of the travelling public - I want to address the corrosive issue of fare dodging once and for all.

"Your staff are at the heart of efforts to protect revenue. They act with the utmost professionalism in what can be difficult circumstances. Yet, to maintain the integrity of our railway, and ensure we treat passengers fairly, I'm clear that any enforcement must be proportionate and not punish those making genuine mistakes.

As set out in the recent publication of the ORR review of train operators' revenue protection practices, the industry must ensure enforcement practices are consistent and transparent. "I accept in full the recommendations of the ORR's review. Their report has once again shown that 30 years of privatisation have left our railways fragmented, inefficient and broken.

Revenue protection practices are inconsistent, and the complexities of the current fares and ticketing system have increased the scope for passenger confusion and error." In the letter, the Transport Secretary highlights the overhaul of the complex fares and ticketing system to make it easier for passengers to understand, so they can trust they are buying the right ticket and getting the best fare for their journey. She adds that the replacement of individual train operators with Great British Railways (GBR) will also enable passengers to receive a more consistent offer across the network.

"The fares, ticketing and retail (FTR) team is now coordinating our response to the ORR review, with RDG delivering several projects," she writes. "The department will publish an update on this activity in due course. I encourage you to engage with the FTR team and RDG as constructively and collaboratively as you did with the ORR during their review. The cross-industry working group set up during the review will continue, with the aim of sharing good practice across the industry.

We are also planning to review revenue protection legislation to ensure this is as clear and effective as possible. "In their review, the ORR identified that it was a common practice across train operators and third-party contractors to use lay prosectors to present cases in court. My officials wrote to all operators in June on the specific issue of lay prosecutors.

It is your responsibility to ensure that you are adequately protecting revenue in a cost effective but lawful way, and where it is appropriate, you should continue using prosecutions as part of a robust and proportionate revenue protection strategy. "However, as 'good' and 'efficient' operators, we would not expect you to use lay prosecutors to present cases in court and carry out other regulated legal activities until you are confident that it is lawful to do so, having taken advice as appropriate. You may wish to note the action taken by DFTO, which moved quickly to secure additional legal resources for fare evasion prosecutions, prioritising cases as appropriate."

ORR's comprehensive investigation looked at the root causes of what leads to passengers travelling without a valid ticket, and how industry responds to this. The report identifies areas for improvement and makes targeted recommendations that will address these issues:

1. Make buying the right ticket simpler and easier

Give passengers clearer information about conditions or restrictions when they are buying a ticket, for example, permitted routes, time restrictions or the use of railcards. This will help reduce confusion and unintentional mistakes.

2. Strengthen consistency in how passengers are treated when ticket issues arise

Passengers should be treated fairly and consistently when they are found without a valid ticket, with industry focusing on targeting intentional fare evasion, as opposed to genuine mistakes, and responding proportionately.

3. Introduce greater consistency and fairness in the use of prosecutions Establish a consistent test for prosecution across all operators, ensuring cases only proceed when clearly justified and in the public interest.

4. Make information on revenue protection easy to access and understand Information should clearly set out passengers' rights and how penalties, prosecutions, out-of-court settlements and appeals work

5. Greater coordination, oversight and transparency of revenue protection activity Establish an appropriate forum or body tasked with identifying and promoting best practice across all aspects of revenue protection policy and enforcement

Speaking at the time of the release of its report, Stephanie Tobyn, ORR's Director of Strategy, Policy and Reform, said: "Effective revenue protection is essential for a sustainable railway, but it must be fair and proportionate for passengers. Our recommendations aim to protect both industry revenue and support passenger confidence. "Our evidence shows a system that has evolved over time where the legal framework and enforcement processes are increasingly complex and appear weighted towards industry, leaving some passengers who make innocent errors vulnerable to disproportionate outcomes.

But meanwhile, fare evasion remains a significant problem, and rigorous action should be taken against those who intentionally seek to defraud the railway."

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References

1. ^ Office of Rail and Road's (ORR) (www.orr.gov.uk)
2. ^ Download article (news.railbusinessdaily.com)