RMT analyse on fares.

August 20, 2020
New RMT analysis shows how fares could be cut immediately by 5% on an annual basis which would save commuters thousands of pounds and encourage passengers back to the railways
 
RMT has called on the Government to slash fares rather than raise them as expected today simply by using £500 million that would otherwise be paid to private rail companies during the Covid-19 crisis.
 
Recent research by RMT found that Britain’s private rail companies stand to make almost £500 million in profits out of the Covid-19 crisis on UK railways over a 12 month period, if the government goes ahead and extends the current Emergency Measures Agreement (EMA) bailouts.
 
However if this £500 million was reinvested in our railways then it would work out as a potential 5%  cut in fares across the board. Over 5 years if this money was reinvested RMT analysis has found that the savings are significant for passengers.
 
Since the lockdown was implemented on 23 March rail usage has slumped to just 23 per cent of pre Covid-19 levels as only 34 per cent of white collar workers have returned to the office whilst a survey of businesses found that 50 per cent say that remote working will become a permanent mix for most of their staff. Alongside RMT’s demands for flexible ticketing RMT is calling on the Government to take bold action and cut fares to encourage passengers back to our railways.
 
Examples of potential savings on season tickets for regular commutes into UK cities include the following (Full calculations including more UK cities can be found in Editor’s Notes below):
 
  • Brighton to London Terminals current season ticket price is £4,580 per year. A 5% fare cut would mean the new season ticket price is £4,351, a saving of £229. Over 5 years the saving would be £1,145 and the new season ticket price would be £3,435.
  • Cambridge to London Terminals current season ticket price is £5,252 per year. A 5% fare cut would mean the new season ticket price is £4,989.40, a saving of £262.60. Over 5 years the  saving would be £1,313 and the new season ticket price would be £3,939
  • Glasgow to Edinburgh Terminals current season ticket price is £2,504 per year. A 5% fare cut would mean the new season ticket price is £2,379 a saving of £125. Over 5 years the saving would be £626, and the new season ticket price would be £1,878.
  • Swansea to Cardiff Terminals current season ticket costs £1,844 per year. A 5% fare cut would mean the new season ticket price is £1,752, a saving of £92. Over 5 years the saving would be £461 and the new season ticket price would be £1,383
  • Stafford to Birmingham Terminals current season ticket costs £1,920 per year. A 5% fare cut would mean the new season ticket price is £1,824, a saving of £96. Over 5 years the saving would be £480 and the new season ticket price would be £1,440.
  • Macclesfield to Manchester Terminals current season ticket costs £2,148 per year. A 5% fare cut would mean the new season ticket price is £2,041 a saving of £107. Over 5 years the saving would be £537 and the new season ticket price would be £1,611.
  • Bradford-On-Avon to Bristol Terminals current season ticket costs £2,268 per year. A 5% fare cut would mean the new season ticket price is £2,155, a saving of £113. Over 5 years the saving would be £567 and the new season ticket price would be £1,701
  • Hebden Bridge to Leeds Terminals current season ticket costs £1,520 per year. A 5% fare cut would mean the new season ticket price is £1,444, a saving of £76. Over 5 years the saving would be £380 and the new season ticket price would be £1,140.
  • Warrington Stations to Liverpool Terminals current season ticket costs £1,640 per year. A 5% fare cut would mean the new season ticket price is £1,558, a saving of £82. Over 5 years the saving would be £410 and the new season ticket price would be £1,230.
  • Hexham to Newcastle Terminals current season ticket costs £1,384 per year. A 5% fare cut would mean the new season ticket price is £1,315, a saving of £69. Over 5 years the saving would be £346 and the new season ticket price would be £1,038.
 
RMT Senior Assistant General Secretary Mick Lynch said;
 
“The fact that private train companies are being propped up by the taxpayer and are still profiteering from our railways to the tune of £500 million a year at a time of national crisis is nothing short of scandalous.  
 
After well over a decade of eye-watering fare increases and with an industry in crisis tinkering with fares is simply not good enough.  Instead we argue that stopping the unjustified profiteering of the train companies would pay for an annual 5% cut in fares as part of a long-term National strategy for our railway.
 
“Now more than ever the Government must be bold and rebuild passenger confidence and encourage passengers back to the railway by giving them what they want:  a publicly owned railway with affordable and flexible ticketing that’s good value and suits their needs as part of the Covid-19 recovery.”
 
 
NOTES TO EDITORS
 
  • RMT’s Report ‘Profiteering at a time of Crisis’  found that Britain’s private rail companies stand to make almost £500 million in profits out of the crisis on UK railways over a 12 month period, if the government goes ahead and extends the current Emergency Measures Agreement (EMA) bailouts. Analysis of ministerial answers to questions in Parliament indicate that the government’s EMAs will see the government hand over around £115 million in operating profits to the train operating companies over the initial 6 month period and £231 million over a 12 month period. The train operating companies are currently lobbying the government to extend the agreements for a further 18 months. https://www.rmt.org.uk/news/publications/profiteering-at-a-time-of-crisis-rmt-report/
·         Total passenger revenue in 2018-19 was £10.207 Billion  – £500 million is 5% of this total https://orr.gov.uk/__data/assets/pdf_file/0019/42562/uk-rail-industry-financial-information-2018-19.pdf
 
Table 1: Savings following a 5% fare cut on popular UK commuting routes over 1 year and 5 years
 
Station commuted from into London terminals
Current season ticket price
Season ticket price with 5% Reduction
Percentage reduction
Total annual saving after 5% reduction
Total saving over 5 years
Season ticket price after 5 year reduction
Brighton to London
£4,580
£4,351
5%
£229
£1,145
£3,435
Cambridge to London
£5,252
£4,989.40
5%
£262.60
£1,313
£3,939
Glasgow to Edinburgh
£2,504
£2,379
5%
£125
£626
£1,878
Linlithgow to Edinburgh
£1,872
£1,778
5%
£94
£468
£1,404
Newport to Cardiff
£840
£798
5%
£42
£210
£630
Swansea to Cardiff
£1,844
£1,752
5%
£92
£461
£1,383
Stafford to Birmingham
£1,920
£1,824
5%
£96
£480
£1,440
Stratford-Upon-Avon to Birmingham
£1,676
£1,592
5%
£84
£419
£1,257
Glossop to Manchester
£1,208
£1,148
5%
£60
£302
£906
Macclesfield to Manchester
£2,148
£2,041
5%
£107
£537
£1,611
Bath Spa to Bristol
£1,736
£1,649
5%
£87
£434
£1,302
Bradford-On-Avon to Bristol
£2,268
£2,155
5%
£113
£567
£1,701
Huddersfield to Leeds
£1,428
£1,357
5%
£71
£357
£1,071
Hebden Bridge to Leeds
£1,520
£1,444
5%
£76
£380
£1,140
Widnes
£1,388
£1,319
5%
£69
£347
£1,041
Warrington Stations
£1,640
£1,558
5%
£82
£410
£1,230
Hexham
£1,384
£1,315
5%
£69
£346
£1,038
Middlesborough
£2,224
£2,113
5%
£111
£556
£1,668
 

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