Rail fares to rise by RPI + 1%, Good value? Options

[Biker1]

FGW rail fares are to rise by approx 6% in the new year.
Is this good value bearing in mind that it is reported that motoring costs have risen by twice that amount in the last 12 months?
Is the extra revenue to go on shareholders dividends or to be re-invested in the infrastructure as we are told?

[Simon Kirby]

FGW rail fares are to rise by approx 6% in the new year.
Is this good value bearing in mind that it is reported that motoring costs have risen by twice that amount in the last 12 months?
Is the extra revenue to go on shareholders dividends or to be re-invested in the infrastructure as we are told?

By my estimate the real-terms cost of motoring fell by 2.4% this year. Every year after the spring budget the AA publish true cost-of-moting tables for a variety of car sizes and annual mileages (see 2010, and 2011). Comparing the cost-of-motoring for a typical family diesel car in the £17,000 to £20,000 price range and an annual milage of 10,000 gives a cost per mile increase of 2.9%, and with the March all-items RPI at 5.3% this represnets a real-terms reduction in the true cost of motoring for a typical family car of 2.4%.

On this basis an RPI+1% increase is equivelent to Cost of Motoring Index + 3.4% increase.

However, I'm not sure how helpful it is to compare the cost of rail travel in these terms. For starters, what's the comparable cost of rail travel? For example, Birming Park and Ride Kings Norton to Five Ways, £3.70 return with free parking at Kings Norton, that's less than half the cost of the equivelent car journey and then you'd have the not insignificant difficulty of parking in central Birmingham. However, take a first class Anytime Return from Newbury to Bath Spa at £194 and that's about 155p per mile, and that's two and a half times the equivelent cost of the car journey, and if you actually have a car then the comparative cost of the car journey is more like 15p per mile as you've already paid for the insurance and depreciation and stuff whether you drive the thing or not, and if you're carrying passangers they're free in the car but full-fare on the train.

Just saying that comparing cost of rail with car is not at all simple.

[Andy Capp]

Just saying that comparing cost of rail with car is not at all simple.

Of course not, but what is true is the rail network could not cope with a massive swing to train usage. It is without doubt our rail provision is a mess.

[Simon Kirby]

Of course not, but what is true is the rail network could not cope with a massive swing to train usage. It is without doubt our rail provision is a mess.

Going up to town isn't great, but the picture nationally can be very different.

[TallDarkAndHands...]

The prices are going up because we need to pay for public sector pensions.

[Simon Kirby]

The prices are going up because we need to pay for public sector pensions.

Seems a rather spurious thing to say - you might as well say the public sector pay restraint is necessary because of the state subsidy of the railways. Care to explain why freezing fares and increasing tax-payer support for rail would be the right thing to do?

[TallDarkAndHands...]

Seems a rather spurious thing to say - you might as well say the public sector pay restraint is necessary because of the state subsidy of the railways. Care to explain why freezing fares and increasing tax-payer support for rail would be the right thing to do?

No thanks. The Railways should not get any tax-payer support. They should be run as a business. If the business model fails a better one will replace it.

[Biker1]

No thanks. The Railways should not get any tax-payer support. They should be run as a business. If the business model fails a better one will replace it.

The railways have not paid for themselves since WW2 and have relied on state help since then.
I don't know what the consequence would be of withdrawing it completely but I wonder if the transport infrastructure of this country could handle being devoid of it's rail system?
If not then surely state aid, and running as a public service, is the only way?

[TallDarkAndHands...]

You could argue that the Railways actually stop innovation. If they did not exist and petrol prices continue to increase how would we get about the Country? I'm sure someone would come up with a greener, quicker, more efficient and cheaper solution in the long run. It's called progress. Also - we are best at innovation with our backs against the wall. Look at the massive forward steps in innovation taken in World Wars in the past. It's just my humble opinion.