Extortionate Price Hikes

[whole diary]

[garryh]

Whilst I'm sure many (if not most) contributors to this site are FGW^▸ (First Great Western) commuters, my profile is somewhat different.

I  (up until now) have been an FGW traveller 2 - 3 times per month, travelling from Essex to South Devon (where we have a second home) - always off peak, booked as far in advance as I am able. Historically I would monitor the website, booking as soon as Advance Fares are released. This journey I have made for the last 9 years (sometimes alone, other times with my wife and other family members).

We have gradually seen a reduction in the availability of Advance Fares, which generally we have been able to be more flexible to still utilise.

However, recently, this has now changed totally, and the previous cheapest Advance Fares (once widely available so long as one books minimum 2 months in advance) have been totally withdrawn. The Advance ticket that previously cost ^15.50, has now almost tripled, and in some cases almost quadrupled. The website still shows in the price range (albeit now ^16.00), but has not been available for a few months.   

This has been so for a while now (couple of months). The net result of this is that (if both myself and my wife) are travelling we will now drive (a fraction of the cost), and if just me, I will use National Express (again, by utilising funfares for the London to Exeter element a fraction of the cost). Since the last reasonably priced tickets will shortly be utilised, I have already pre-booked NX tickets for February......

Absolutely ludicrous. Good job FGW - now you will have extra empty seats.......

[EBrown]

FGW^▸ (First Great Western) offer a number of Advance Purchase tickets between London Paddington (PAD^» (Paddington (London) - next trains)) and Exeter St. David's (EXD^» (Exeter St Davids - next trains)).

^12 is the lowest cost Standard (STD) ticket between PAD & EXD. That is not including Railcard savings!
^93.50 is the most expensive STD ticket between PAD & EXD.

The car journey between Chelmsford and Exeter by car is 240 miles. Taking a generously (low) figure of 15 pence per mile is ^36. Seems that train tickets aren't that bad of a deal really.

Please also consider (and there are far more expensive routes) that for me to travel in one direction between Reading and Paddington (around 36 miles) is ^16.40 for an Off Peak Day Single.

[Brucey]

Welcome to the Coffee Shop forum garryh.

I have also made a similar observation to you, but across the entire rail network.  My assumption would be that more people are now aware of booking in advance, so the offers don't need to be so good to get the same number of "bums on seats".

It is a shame when you are used to be paying a hugely discounted fare and the prices increase but remember how much saving you have saved compared to the walk-up price.

[grahame]

Welcome to the forum, Garry.

Advanced Purchase Tickets for a specific train are unregulated - in other words, First can offer as few or as many of the for sale as it chooses.  Originally intended (I understand) to attract new custom at quieter times, with the dramatic growth of rail passenger numbers in recent years there have become fewer quieter times ... and I can understand that these bargain fares may have become many fewer in number and harder to find.  ((Especially as the tickets have become far better known about too))

Ironically, the new booking engine used on the FGW^▸ (First Great Western) site lists all fares, and I find it frustrating rolling over lots of very cheap fares that aren't actualy available for when I want to travel looking for a decent price.  The old engine simply started at the lowest available price, and didn't rub my nose in prices that were very good - or would have been if they were available - before I found the lowest available price.   This is - psychologicaly - something of an own goal, I think.

Alternatives to advanced fares, Garry.   
a) Have you looked at travel via Salisbury, and possibly with a Networker card?
b) You may also want to look at the friends and family card, and Groupsave, when there's more than just yourself travelling.

I always imagine it is a very expensive proposition to run a second home, but perhaps I'm wrong. How much have you typically spent each year with FGW for journeys to and from South Devon, and is that a significant percentage of your second home expenditure?  In other words, does a loss of advanced fares really effect the viability of a second home for you?

[JayMac]

It's also worth remembering that for a period between 2008-2009 First Great Western were forced to release 500,000 more cheap Advance tickets onto the market by the then Secretary of State Ruth Kelly. This was after FGW^▸ (First Great Western) were caught by the regulator massaging their performance figures.

That will have skewed the perception of the availability of cheaper tickets compared with later years.

[woody]

One has to remember the changing economics of the railway world now as a result of the ongoing effects of the 2008 global financial meltdown.Great Western and indeed South West trains for that matter are now both in government revenue support (cap and collar).When the current FGW^▸ (First Great Western) franchise started it was actually receiving subsidy rather than paying a premium to the government.But now as we all know those contracted premiums gradually ramped up to reach levels that First Group have considered unsustainable hence the reason they decided to exercise their contract option to terminate the franchise in year seven of the FGW franchise instead of year 10.
  What that means is that despite rising passenger numbers those numbers have fallen well short of financial assumptions made back in 2006 when First Group bid for the franchise.That shortfall is now having to be made up with revenue support payments from the taxpayer (cap and collar).Indeed such is the shortfall in revenue on FGW now that only 75% of its income comes from the fare box.The other 25% is now taxpayer revenue support.Worse still as a proportion of all the revenue support payments being paid out now by the government to other TOCs^▸ (Train Operating Company) in a similar position,FGW alone are now receiving a massive 42% of that total.                                                                                 Factor in the massive ^5billion Great Western main line electrification scheme and all this at a time when it is now stated government policy to transfer more of the cost of running the railway from the taxpayer to the passenger with resultant repeated annual inflation busting rail fare rises it should not be surprising given all these economic drivers that average rail fares in general can really only really go one way and that's UPWARDS! and I wont even mention privatisation and the politics of it all.

[Andy W]

One has to remember the changing economics of the railway world now as a result of the ongoing effects of the 2008 global financial meltdown.Great Western and indeed South West trains for that matter are now both in government revenue support (cap and collar).When the current FGW^▸ (First Great Western) franchise started it was actually receiving subsidy rather than paying a premium to the government.But now as we all know those contracted premiums gradually ramped up to reach levels that First Group have considered unsustainable hence the reason they decided to exercise their contract option to terminate the franchise in year seven of the FGW franchise instead of year 10.
  What that means is that despite rising passenger numbers those numbers have fallen well short of financial assumptions made back in 2006 when First Group bid for the franchise.That shortfall is now having to be made up with revenue support payments from the taxpayer (cap and collar).Indeed such is the shortfall in revenue on FGW now that only 75% of its income comes from the fare box.The other 25% is now taxpayer revenue support.Worse still as a proportion of all the revenue support payments being paid out now by the government to other TOCs^▸ (Train Operating Company) in a similar position,FGW alone are now receiving a massive 42% of that total.                                                                                 Factor in the massive ^5billion Great Western main line electrification scheme and all this at a time when it is now stated government policy to transfer more of the cost of running the railway from the taxpayer to the passenger with resultant repeated annual inflation busting rail fare rises it should not be surprising given all these economic drivers that average rail fares in general can really only really go one way and that's UPWARDS! and I wont even mention privatisation and the politics of it all.

Very interesting post Woody.
Do you have the actual figures ie figures that the franchise was awarded on vs the actual figures achieved?
Additionally do you have the figures for the unsuccesfull bids? i.e. have they proved to be more accurate?

[Andrew1939 from West Oxon]

I think the main problem with the FGW^▸ (First Great Western) franchise is that at the start no one envisaged that there would be the most severe and long running recession for many years, particularly after Gordon Brown announced that he had abolished boom and bust with the labour economic policy. I remember the FGW MD reporting that when the recession set in Thames Valley commuter travel reduced significantly as so many city workers were made redundant and that first class business travel was also significantly cut back as firms made their staff travel standard class instead of first. Other forms of travel have kept up relatively well and increased as you get away from the London traffic but not sufficient keep up with the projected growth pattern envisaged in the original franchise arrangements.

[woody]

The causes of the financial hole the railways now find themselves in now goes far beyond domestic party politics.It like arguing over the loose change in your pocket while the ship is  sinking.So if you really want to know how we and indeed the rest of the world are in the deepest recession since the 1929 wall street crash then watch the following series of four programs about the causes and consequences today of the 2008 global financial crash entitled "Meltdown" starting with "the men who crashed the world" .We definitely do not want to go there again.

http://tinyurl.com/coh5b5p^

[paul7575]

I see the Labour spokeswoman (Eagle) again has nothing much to say in response to this non-story.  I suppose with the coalition maintaining Labour's 1% above RPI^▸ (Revenue Protection Inspector (or Retail Price Index, depending on the context)) after abandoning the 3% policy, she's a bit stuck for detail...

Anyone else feel it is just the same old predictable stuff - with the annual round of prediction based on RPI, DfT^» (Department for Transport - about) and/or TfL^» (Transport for London - about) then confirming RPI + whatever, then the prices trickle through into retail systems about 4 weeks before, then the rises actually take effect.  So the media can trot out basically the same 'fill space' article (based on the same PF^▸ (Penalty Fare)/TSSA^» (Transport Salaried Staffs' Association - about) press releases) at least four times, and that doesn't include revealing it following budgets and autumn statements etc...

If some of these journalists, like the guy from Winchester writing in the Telegraph, are so damned clever, why don't they buy their 'overpriced' annual season on Dec 31st like any sensible person and defer the rise for a whole year?

Paul

[Andy W]

If some of these journalists, like the guy from Winchester writing in the Telegraph, are so damned clever, why don't they buy their 'overpriced' annual season on Dec 31st like any sensible person and defer the rise for a whole year?

Paul

Paul, a clever man can work out the percentage increase - a wise man buys the ticket a day earlier.

Does anyone know what the increase in costs have been for First over the past year?

i.e. - for example
Staff costs
Fuel costs
Leasing costs
Track access charges
etc.etc.etc

What is the increase/decrease in revenues

Seems to me rail use is on the increase so I would expect revenues to increase - (although there may be a switch from first to standard class).

[Umberleigh]

Hi Garryh,

I was sorry to hear of your plight, so I had a look on the FGW^▸ (First Great Western) site for Standard Class Advance Off Peak tickets for two months hence (early March) and in both directions.

I found fares as low as £16.50, for travel during the morning/afternoon i.e. not late at night. So it would seem the cost has increased by £1..? Or have I misunderstood your post?

But it gets better, for travel one month from now, Megatrain are offering seats on SWT^▸ (South West Trains)'s Waterloo - Exeter service for £10! And trust me, it beats 5.5 hours squeezed onto National Express anyday.

Hope this helps.

[jparren]

I too have observed FGW^▸ (First Great Western) policy re advance fares.

For the last 6 years I have each month travelled from Bodmin to Bearsted and returned twice a month. I travelled out on the 0806 from Bodmin and usually come back on the 1406 from Paddington. There was a sudden price hike just prior to the Olympics that has been sustained and indeed got worse. I usually was able to get tickets for ^17.00 one way making a total cost per month of ^68.00. Now on any train on the Thursdays I travel the cheapest advance ticket is ^53.50 making a total cost to travel to work per month of ^214! This cost is actually only 50p cheaper than an Open off peak return.
 
I broached the issue with fgw who last year first of all claimed the lack of the cheaper advance fares was due to an input error; they then denied this and said that the cheaper advance fares were available and I was not quick enough in buying one ( I think not). Fgw however would not provide evidence of the number of the cheaper advance tickets made available or sold.

Like many areas of society that are/were unregulated (bank, loan sharks, wheel clampers) sharp practice often prevails. Fgw is no exception. To continue to advertise the lower fares but not offer them is in my opinion misleading and I will report this matter to Trading Standards.

Hopefully FGW will see some sense and make some adjustments downward on the advance fares. I have no problem paying more for my tickets just not the massive increase that has been applied

[devon_metro]

Like many areas of society that are/were unregulated (bank, loan sharks, wheel clampers) sharp practice often prevails. Fgw is no exception. To continue to advertise the lower fares but not offer them is in my opinion misleading and I will report this matter to Trading Standards.

They only need to sell one ticket at the lowest price to comply with the advertising, and i'm sure a company like FGW^▸ (First Great Western) would cover their own backs in such a case!

[John R]

I'm not sure that's the case. I think a reasonable number need to be made available, else it is regarded as a misleading advert. That is certainly the case for other goods, to avoid the situation whereby one holiday/tv etc is advertised at the lower price, and is long gone by the time people looking at the advert attempt to purchase the goods at that price.