Smart ticketing must start with simplicity
22 February 2016 | Author: Jim Steer, Director, Steer, Davies Gleaves

Londoners are stunned when they realise that other parts of the country don't have Oyster, so familiar and essential has it become in the capital.

Getting something similar for the North and the Midlands is a top priority. Surely this can be quickly fixed, well before major investments in east-west transport infrastructure come onstream?

Perhaps not. What is not widely understood is just how long it has taken Transport for London to get to today's happy state, with full multimodal functionality and a choice of contactless and Oyster available.

The process started 35 years ago. Then, in an inspired piece of political leadership, the incoming leader of the Greater London Council Ken Livingstone insisted he wanted a single flat fare for the whole of London.

London Transport was aghast. Such a coarsening of the fares regime, then full of local peculiarities, would surely mean a huge loss of revenue, it objected. So a compromise was duly reached: there would be not one, but two, zones, an inner and an outer. This arrangement soon evolved to six concentric zones for Greater London – and a few more for areas beyond served by lengthier London Underground lines.

By the mid-1980s, a family of Travelcards was available for single zones or combinations of them, and combinations of travel modes. Public transport use soared. Amazingly, 30 years later, Travelcards are still available, now encoded with a magnetic strip to operate the ticket barrier system installed in the 1990s.

Oyster was launched in 2003; contactless ticketing, at first on buses only and using the same yellow card readers, followed in 2012. It already accounts for 25% of London's pay-as-you-go travel, with bank cards accepted from 70 countries.

So the sequence in London, with a properly resourced implementation team, strong singular political leadership, dedicated budgets and a substantial role for private sector contractors was: first, simplify the fares; second, rationalise fares applicable across diverse routes and modes; third, install gatelines at all stations; fourth, progressively adopt electronic systems. With operations and ticketing digitised, a natural follow-on is to make data freely available for third-party app providers.

London's system is rightly recognised as world-leading. But it has taken over 30 years to get there and to build trust in the system and the brand. So expectations on Transport for the North, for example, need to be set accordingly.

Not that it can be given 30 years. Speaking to The Times on 8 December, TransPennine Express managing director Nick Donovan was surely right to demand smart ticketing for the north of England – and the newly awarded TPE franchise will introduce simpler smart and mobile ticketing, according to First Group chief executive Tim O'Toole.

Donovan bemoaned the rail industry's inability to make progress thus far, excusing itself with tales of a complex fare inheritance. But he might have gone too far in thinking that Oyster was dead now that contactless was available.

As Shashi Verma, TfL's director of customer experience and the man who has led in this field forover ten years points out, Oyster – a card issued and administered by TfL – still has appeal to some market segments in the era of contactless bank cards.

It has a continuing purpose for those without bank accounts (children, for example); for those who may have an account but don't have contactless cards; and those who prefer to manage their expenditure on travel separately. That's why there are 11 million Oyster cards in existence today.

And as rail fare expert and commentator Barry Doe – one of a handful of people who would claim to understand today's national rail fare structure – recently pointed out, smartcards only work with a clean slate. To add them to an already over-complicated fare system would be a disaster, he said. As explained here, London made those simplifications many years ago. It took strong political leadership to do it. Ken Livingstone didn't have to worry about the impact on franchise economics or individual bus companies.

And here's the rub. TfL manages and takes the revenue risk on the bus and Tube system. On top of this, the bus and Tube market is so big that TfL was able to drag rail along with it. Outside London, the difficulty is to get all operators to agree the price of a multi-operator ticket, whether it is smart or not, and this is where commercial interests come into play. There is a financial barrier to simplified ticketing. We might get smart, but will we get simple?

It will be important for Transport for the North to make early progress. The new rail franchises will have a key part to play. The metro/tram systems can surely then be added. But only five of 500 stations under the Northern franchise have ticket gates. Strong leadership and northern innovation is clearly called for.

Reference: Transport Times, January/February 2016 Issue

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