Transport for London to take over more suburban rail routes

[RANGERS]

In relation to just about anywhere else in the UK, London has an outstanding transport network which is the envy of the rest of the country and so it should be, they're paying for it!

 

One thing places London above every other part of the UK transport network, namely the cost. The level of subsidy is significantly greater than anywhere else, the direct grant to TfL from central Govt is in the order of 3/4 of a billion. the rest of TfL costs come from local Govt subsidies (the equivalent of supported services in the rest of the UK), fare and commercial revenue. The direct Govt subsidy will cease by 2020 which then poses the question how can services be maintained at the current level without substantial fare increases? If they can, the next question is why wasn't it done before?

 

It can be argued that the ridership in relation to the population is greater, but with the level of congestion and as London sees a much higher proportion of visitors than anywhere else (meaning theres more people there without their own transport), thats hardly surprising.

 

The Oyster card system is a real winner though, how it will work across a wider scale is open to debate and only time will tell. It's already possible to use the Oyster to certain destinations outside London, Gatwick for example, but I'm told that the Oyster fare is more than some of the cheapest walk up fares, an off peak return via Thameslink from London worked out just under there pounds more using an Oystercard.

 

DfT will be keen to get some of the capital spend off it's books and into TfL's domain but the downside is the value of the franchises will be significantly reduced if TfL are calling the shots.

[The Stationmaster]

 

DfT will be keen to get some of the capital spend off it's books and into TfL's domain but the downside is the value of the franchises will be significantly reduced if TfL are calling the shots.

That's a very interesting point.  Will The Treasury simply see it, and finance it, as a transfer of subsidy from the franchise to TfL or will some other Govt department look at it in another way?  

 

Logically if you increase train frequency you are going to increase your operating costs - all of them.  Therefore a straight transfer of subsidy will not cover the costs of a more frequent service unless it is somehow able to be run more economically but at the same time the existing franchise is losing economies of scale in the allocation of headquarters costs, overhead, and safety validation while the new 'owner' (TfL) of the service will inevitably have to recreate some of those costs and won't be able to cover all of them out its existing HQ costs etc.

 

 

If we take the example of Southern, where many people are clamouring for a TfL takeover in order to 'make things better', we have both that financial conundrum plus the further one of not actually being able to 'improve' things unless you pay for more staff, more train maintenance, possibly even for more trains, and so on.  And that is before there is any infrastructure consideration, where things will be unchanged - unless access charges are increased sufficiently to cover not only the additional costs arising from greater frequency but also to cover renewals and enhancements to improve reliability.

 

Like many other aspects of privatisation simply changing a coat of paint or the logos decorating the rolling stock doesn't necessarily mean things will get better.  Thus far OvergrounD seems to have made a very positive impact and to have genuinely added value and travel opportunities but I suspect the financial cost needed to deliver that would have been quite high.  It's good to see the money spent, I welcome it - but the inescapable bit is that to be spent it has to come from somewhere.   Will the taxpayers of London - private or businesses - be keen on larger tax bills in order to pay for extra or more reliable trains in an adjacent county or one even further removed from 'London'?  That would seem to be an inevitable result if funding of TfL is moved from central Govt to London's local Govt and where TfL is operating outside its taxation area.

 

Crossrail would again be a good example of this as it will be operating - at least on my side of the capital - through Buckinghamshsire and Berkshire but touching only a relatively small part of the former and also readily accessible to passengers from South Oxfordshire in the latter.  Who will pay for station staffing and provision of station toilets to cover longer daily periods of train operation than is currently the case (sorry to again mention toilets but Crossrail's argument for not having toilets on its trains is that it will have them on its stations - so it has some work to do, and pay for)?

[Mike Storey]

In relation to just about anywhere else in the UK, London has an outstanding transport network which is the envy of the rest of the country and so it should be, they're paying for it!

 

One thing places London above every other part of the UK transport network, namely the cost. The level of subsidy is significantly greater than anywhere else, the direct grant to TfL from central Govt is in the order of 3/4 of a billion. the rest of TfL costs come from local Govt subsidies (the equivalent of supported services in the rest of the UK), fare and commercial revenue. The direct Govt subsidy will cease by 2020 which then poses the question how can services be maintained at the current level without substantial fare increases? If they can, the next question is why wasn't it done before?

 

It can be argued that the ridership in relation to the population is greater, but with the level of congestion and as London sees a much higher proportion of visitors than anywhere else (meaning theres more people there without their own transport), thats hardly surprising.

 

The Oyster card system is a real winner though, how it will work across a wider scale is open to debate and only time will tell. It's already possible to use the Oyster to certain destinations outside London, Gatwick for example, but I'm told that the Oyster fare is more than some of the cheapest walk up fares, an off peak return via Thameslink from London worked out just under there pounds more using an Oystercard.

 

DfT will be keen to get some of the capital spend off it's books and into TfL's domain but the downside is the value of the franchises will be significantly reduced if TfL are calling the shots.

 

DfT does not provide subsidy for "capital" investment, if that is what you meant, to TfL. They only provide operational subsidy, for "current" spending. It is that £750m which TfL must make up and they appear to be going to do this through increased business rates retention (the Precept), plus fares increases at inflation (RPI) plus 1%, for the next three years, which is greater than national rail, who are currently restricted to RPI. This is not a great challenge, as TfL have a turnover of around £11.5 billion, where national rail is around £13 billion.

 

Thus national taxpayers will be paying an increasingly smaller share of subsidising transport in London - not the case elsewhere in the country, until the powers gained by the GLA are passed to local authorities. That seems to be the intention for the northern regional area, but the geographical extent and involvement of which existing authorities remains unclear. Birmingham is heading the same way, and Avon would like to. Whether this will prove to be their salvation or their downfall, depending on the formulae adopted.

 

Around 20% of TfL's income is from Bond issues, and is only used for capital infrastructure enhancements, with AAA rating as it is underwritten by the GLA (and thus the Treasury). Get some of this cost off NR's books and they can finally start to reduce their debt, maybe.

[Mike Storey]

That's a very interesting point.  Will The Treasury simply see it, and finance it, as a transfer of subsidy from the franchise to TfL or will some other Govt department look at it in another way?  

 

Logically if you increase train frequency you are going to increase your operating costs - all of them.  Therefore a straight transfer of subsidy will not cover the costs of a more frequent service unless it is somehow able to be run more economically but at the same time the existing franchise is losing economies of scale in the allocation of headquarters costs, overhead, and safety validation while the new 'owner' (TfL) of the service will inevitably have to recreate some of those costs and won't be able to cover all of them out its existing HQ costs etc.

 

 

If we take the example of Southern, where many people are clamouring for a TfL takeover in order to 'make things better', we have both that financial conundrum plus the further one of not actually being able to 'improve' things unless you pay for more staff, more train maintenance, possibly even for more trains, and so on.  And that is before there is any infrastructure consideration, where things will be unchanged - unless access charges are increased sufficiently to cover not only the additional costs arising from greater frequency but also to cover renewals and enhancements to improve reliability.

 

Like many other aspects of privatisation simply changing a coat of paint or the logos decorating the rolling stock doesn't necessarily mean things will get better.  Thus far OvergrounD seems to have made a very positive impact and to have genuinely added value and travel opportunities but I suspect the financial cost needed to deliver that would have been quite high.  It's good to see the money spent, I welcome it - but the inescapable bit is that to be spent it has to come from somewhere.   Will the taxpayers of London - private or businesses - be keen on larger tax bills in order to pay for extra or more reliable trains in an adjacent county or one even further removed from 'London'?  That would seem to be an inevitable result if funding of TfL is moved from central Govt to London's local Govt and where TfL is operating outside its taxation area.

 

Crossrail would again be a good example of this as it will be operating - at least on my side of the capital - through Buckinghamshsire and Berkshire but touching only a relatively small part of the former Thealso readily accessible to passengers from South Oxfordshire in the latter.  Who will pay for station staffing and provision of station toilets to cover longer daily periods of train operation than is currently the case (sorry to again mention toilets but Crossrail's argument for not having toilets on its trains is that it will have them on its stations - so it has some work to do, and pay for)?

 

These are not new issues Mike - LUL and indeed the old London Country buses, have operated outside the old GLC and now GLA area for many decades, into Hertfordhsire, Buckinghamshire and Essex particularly. The formulae for county council contributions already exist, which gives TfL something to put on the table with recalcitrants. For example although Croydon is technically in Surrey, it is now part of the GLA domain, so Croydon Tramlink was paid for largely through local business precepts and direct grant and a deal with RT/NR for costs avoided. The re-connection of Watford Jn vice Watford High Street to the Met was done as part of a deal with Herts CC and Watford DC, and commercial property sales. All these things have precedents (including sacrificing passenger comfort and luggage space for crush-load densities in central London) so it is the extent of the enhanced services, infrastructure and maintenance funding requirements which will no doubt exercise the brain. Given they forecast the population of London to rise from 8.6 million to 10 million in less than one generation, I suspect that money will be found.

[The Stationmaster]

These are not new issues Mike - LUL and indeed the old London Country buses, have operated outside the old GLC and now GLA area for many decades, into Hertfordhsire, Buckinghamshire and Essex particularly. The formulae for county council contributions already exist, which gives TfL something to put on the table with recalcitrants. For example although Croydon is technically in Surrey, it is now part of the GLA domain, so Croydon Tramlink was paid for largely through local business precepts and direct grant and a deal with RT/NR for costs avoided. The re-connection of Watford Jn vice Watford High Street to the Met was done as part of a deal with Herts CC and Watford DC, and commercial property sales. All these things have precedents (including sacrificing passenger comfort and luggage space for crush-load densities in central London) so it is the extent of the enhanced services, infrastructure and maintenance funding requirements which will no doubt exercise the brain. Given they forecast the population of London to rise from 8.6 million to 10 million in less than one generation, I suspect that money will be found.

I've no doubt the money will be found Mike - that always seems to be the case for transport in London which is a realistic approach even if it isn't anything like enough when it comes to capital investment.   I also realise the new proposal relates to inner suburban services within Greater London but the point is that some of the cost of these will come off the DfT's books and will, if TfL does what it says it will do, add considerably to TfL's operating costs.

 

I doubt, for example that should it happen, local authorities in parts of Berkshire and Buckinghamshire would be at all happy to see any precept on Business Rates (especially if the system is revised) diverted into Crossrail which is really only likely to benefit estate agents and possibly developers.  In fact local rail transport in East Berkshire will suffer a decline in service frequencies westwards towards Reading which is exactly opposite to the local council's transport policy emphasis on public transport.

 

Crossrail is also, I realise, very different from what is being talked about for the inner suburban area but TfL need to appreciate even there I suspect that commuting and leisure traffic does not flow only towards central London.  Croydon Tramlink is an excellent local transport asset which no doubt benefits Croydon as much as if not more than anywhere else so a local precept is understandable; teh same idea might not work so well elsewhere perhaps?

[roythebus]

Remember too that a lot of TfL's revenue comes from the motoring fraternity in the form of the Congestion Charge, penalty charges for yellow box junction infractions, no right turn cameras, speed cameras etc. 

 

As TfL found a few years ago when they introduced the C Charge, their revenue went down as less car drivers visited the centre of town to avoid paying the C charge!

 

Croydon Tramlink is an excellent example of public transport. It used to run past my office window in Mitcham. when it was the Spratt & winkle, a 2 car train would rumble past every 45 minutes with few passengers on board. with a tram every 7 minutes in each direction, they were packed solid every minute of the day. But, has road congestion in the area improved? A resounding NO! Was Tramline worth it? I would say Yes, otherwise Croydon would have been impassable by now, and there's plans to double the tram from Mitcham to Wimbledon to improve the frequency. Some of this is due to the foresight of those who built the Surrey Iron Railway back in 1804; some of the new tramway uses the line of route!

[phil-b259]

With regard to TfL financing, what HM Treasury are planning to do by 2020 is abolish subsidising the operating costs of TfL services - i.e. making up the difference between what fares, business rates, advertising revenue, etc bring in and the cost of paying for drivers, track maintenance staff, electricity bills, train maintenance, etc.

 

HM Treasury will however to continue to fund / part fund capital enhancements - e.g. new train fleets, new lines and suchlike - seemingly because they look a lot better in the nations accounts and can possibly make use of Private sector funding vehicles like overseas pension funds.

 

The big problem with this is that operating costs are not trivial and if you don't look after what you have previously 'invested in' then said item loses its value and the policy becomes self defeating. For example the Highways Agency / Highways England have enthusiastically embraced the concrete central reservation barrier as one of its advantages is it requires 'no maintenance'. While that may be true on the strictest sense, not having to maintain them means there is nobody to go round and clear gullies blocked by vegetation or pick up debris / rubbish that accumulates against them (despite one of the alleged advantages of having the carriageway surface flush to the edge of them being the ability to use road sweepers to remove debris.

 

However that does not matter to HM Tresauary because operating costs should be paid for by users apparently and if they are too high it is simply because the operator is doing a bad job (and in the case of public sector bodies said organisation needs some good old private sector expertise to improve matters)

 

HM Treasury want to do the same thing to the national network and there are continued efforts to alter the way subsidies are paid to TOCs with an effort to increase NRs track access fees and offset the increase elsewhere - which disproportionately affects open access operators (who HM Treasury don't like as the competition they bring lowers the amount of profits franchised TOCs make).

[phil-b259]

Probably part of some secret campaign to make London back into the biggest city in the world.  DafT seems to have some very strange ideas about London commuting and how it mixes with long distance travel (which they seem keen to discourage by reducing comfort levels etc as a  result of trying to turn the train into high density commuter services).  Meanwhile TfL has similar ideas on its longer distance ventures such as (make me Cross)rail where they blatantly ignore ATOC standards for passenger comfort/facilities and while I fully appreciate those 'standards' are more of an aspiration than a 'standard' the result is trains with low levels of comfort and lack of facilities (i.e. toilets) for passengers making journeys of more than 30 minutes duration.

 

To be perfectly honest I simply don't fancy sitting on a longitudinal bench seat with no view of the outside once the train fills and no opportunity to go for a pee after an evening out in the big city.  these halfwits simply don't seem to realise that nervous exhaustion apart the competition is a cosy car with no draughts from the doors every now and then, air conditioning, and R4 when you want it or a road coach offering not much less than that.  Some modern train designs seem to be targetted on driving people off the railway rather than attracting them to it or imposing lowest common denominator standards on trains which serve both high capacity urban needs and longer distance journey needs (where will you put your luggage on a Crossrail train I wonder?).

 

Ahh but if less people use the train then you need less trains and consequently need to spend less on expensive infrastructure enhancements - which is music to HM Treasury's ears. This used to work well in the days of BR where as a general rule new train fleets were expected to have higher availability (thus reducing the total needed) and even electrification / resignalling schemes were more about rationalising / simplifying / streamlining infrastructure provision than anything else