‘CHANGING TRACK’ Rail Reform Essential

Just over two years ago the United Kingdom went into its first national lockdown. Overnight, rail lost its monopoly on commuting. Journeys fell from 1.7 billion to 388 million and the industry faced an unprecedented revenue crisis which has burdened taxpayers with a £14 billion bill.

Despite the UK being one of the most open societies across Europe, rail journeys have not bounced back. New figures revealed by the Centre for Policy Studies (CPS) show that the number of people commuting every day at peak time is just 15% of the pre-pandemic total. Most commuting now takes place Tuesday to Thursday; Mondays are 20% lower and Fridays are 50% lower than before the pandemic. And overall, commuter journeys remain at just 45% of pre-pandemic levels, with five-day peak hour commuting – Monday to Friday – standing at just 15% of the previous total.

In a new report, CPS Research Fellow Tony Lodge argues that customers’ use of the rail network is becoming far more flexible, with an increased focus on long-distance leisure commuting – and warns that unless UK rail is radically overhauled, and able to respond to new passenger demands for freedom and flexibility, it will be plagued by a future of decline and underinvestment that will necessitate either an extra penny raised on income tax to cover a taxpayer subsidy to the annual tune of £6bn, or cuts to railway lines on a scale not seen since the Beeching cuts in the 1960s.

‘Changing Track’ proposes a series of urgent measures to ensure that the modern railway retail offer focuses on passengers’ priorities. At the heart of the proposals is a simpler, fairer and more flexible cloud ticketing system which is able to respond to new and evolving passenger demands, including the abolition of sky-high peak prices.

These changes should be underpinned by the Government’s new public body, Great British Railways, committing to boosting competition and driving private investment across the network – thereby boosting revenue growth and securing its future. The paper points out that open access competition on the East Coast Mainline, as advocated by the CPS, has resulted in lower fares, greater passenger satisfaction and a stronger rebound in passenger numbers – and calls for it to be rolled out on other long-distance routes, including HS1 and HS2.

It also calls for a greater focus on private investment, and ambitious targets to treble the volume of rail freight.

Not only are these reforms essential in shoring up the railway’s future, they will also help drive forwards the Government’s levelling up and Net Zero agendas.

The alternative is that lower passenger numbers and continued losses to the taxpayer lead to a vicious circle of decline and underinvestment.

Tony Lodge, report author and CPS Research Fellow, said:

 

‘The pandemic fundamentally changed the nature of rail in the UK. The Government has the opportunity – through the new Great British Railways body – to radically overhaul the current model to make sure that it is fit for purpose and able to meet modern passenger demands.

 

‘Frankly, if the Government doesn’t implement these reforms, there is no certainty that rail will have a future and taxpayers will inevitably be forced to foot the bill for its decline.’