Destination: RevenueGrowth

DESTINATION: REVENUE GROWTH

The Railway Industry Association’s (RIA’s) blueprint to enhance the UK railway’s ticketing and retail offer, in order to: meet the aspirations of the Government’s ‘Plan for Rail’; boost ridership; enable decarbonisation; and drive revenue growth.

March 2024

About RIA

The Railway Industry Association (RIA) is the voice of the UK rail supply community. We help to grow a sustainable, high-performing railway supply industry, and to export UK rail expertise and products. RIA has over 360 companies in membership from a sector that contributes £43 billion in economic growth and £14 billion in tax revenue each year, as well as employing 710,000 people [1]. It is also a vital industry for the UK’s economic recovery, supporting green investment and jobs in towns and communities across the UK; for every £1 spent in rail, £2.50 is generated in the wider economy [2] RIA’s membership is active across the whole of railway supply, covering a diverse range of products and services and including both multi-national companies and SMEs (60% by number).

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Copyright

Foreword

By Milda Manomaityte, Innovation Director, Railway Industry Association

The first version of this paper bounced around RIA with the working title ‘The future of ticketing’. Until, that is, a smug colleague pointed out that the future of ticketing wasn’t tickets at all: ‘The future of no-ticketing’. As the paper grew, we reflected that ticketing is just one small cog in an enormous customer-facing machine of information provision, journey planning, retail, loyalty, revenue generation, revenue collection, journey validation and enforcement. A multitude of touchpoints, and very few of them cardboard-based. We eventually settled on a short, snappy title that better reflects the report’s desired outcome. One which purposefully does not use the word ‘ticket’.

‘Ticket’ instils a mental picture like that on the front cover – iconic, orange-edged cards. That card seems to have no end of abilities: The ability to avoid detection in any pocket, purse, or bag when the inspector looms. The ability to dissolve to mush on contact with the smallest hint of moisture. The ability to be rejected by barriers only when the queues are at peak backlog.

It is easy to poke fun, but the introduction by British Rail and London Underground of magnetic stripe tickets through the 1980s was revolutionary: a solution low in cost, practical, accessible, and easy to understand – including for machines – therefore enabling automation of a large part of the retail and enforcement process. Back then, the tickets weren’t all orange! There were green, blue, grey, and even gold variations for swift identification of regular travellers – an early loyalty scheme. MagStripe was so good, in fact, that paper tickets were still used on over half of all rail journeys right up until 2019.

The digital era is now well underway. RIA’s earlier A Railway Innovation Strategy [3] and Data and Digital Technologies in Rail [4] highlighted that we are on the cusp of a digital decade. Innovation is moving at a pace never seen – digital ticketing is a prime example. As an industry, we have a responsibility to ensure this technological change is harnessed to match the ever-growing expectations of our customers. Not only is this a necessity to ensure we retain business, it is also a proven strategy to attract new users: growing revenues, and contributing to decarbonisation, inclusivity, and accessibility. Conveniently, these aspirations align perfectly with those of the recent Williams-Shapps rail review [5]

The technology and knowledge to provide a retail revolution are here right now. RIA members have made investments in developing capabilities. They are poised to support the industry in achieving significant revenue growth. Revenue growth does not just mean raising fares – it means more bums on seats, more people choosing railways, more people enjoying railways, more people having railways at the heart of their day-to-day transport needs.

However, if the private sector and supply chain is to invest and successfully support this growth, it has some basic needs. In this paper we highlight those needs through a series of key asks which, when met, will enable the industry, to unlock the significant growth potential.

On behalf of the whole RIA team, I would like to thank every organisation and individual who has contributed to this paper. I hope that it helps guide our industry towards delivering the service which our existing and potential customers deserve, and the revenue growth which we all know is possible.

Executive Summary

The Railway Industry Association’s (RIA’s) ‘Destination: Revenue Growth’ report examines the landscape of UK rail’s current ticketing and retail offer. It analyses the gaps between the Government’s aspirations, policy and implementation; and it makes a number of key ‘asks’ to overcome those gaps, with the goal of enhancing the customer experience and boosting ridership, to drive revenue growth without increasing ticket prices.

The current UK mainline ticketing offer is the result of many years of patchwork development, a mix of legacy and modern systems. During those years, a combination of rail privatisation, devolution, and oft-changing political vision, leadership and strategy, have all contributed to this piecemeal approach. The immediate impact is that the railway system in the UK falls far short of customer expectations, putting many potential customers off. Knock-on effects include elevated costs to the taxpayer and under-utilised assets.

Recent research commissioned by RIA and conducted by the independent Steer consultancy shows that the right customer offering could contribute to growth in passenger numbers of between 37% and 97% by 2050. As customer experience is linked to ridership, this represents a much missed opportunity to maximise revenue, minimise subsidy, and accelerate decarbonisation.

In contrast, Transport for London (TfL), with stable leadership, a strong vision, forethought and the autonomy to implement, have created a system highly-regarded both by those who use it, and on the international stage. Pioneering ‘contactless’ ticketing has earnt the trust of the travelling public in and around the capital, and contributed significantly to ridership and revenue growth. Conversely, national mainline rail ticketing is often mistrusted by the public, having a deleterious impact on ridership and revenue.

Government policy has identified the same concerns. The cornerstone of the current Rail Reform agenda, the so-called ‘Plan for Rail’, makes a number of promises on rail retail. However, RIA has identified several shortcomings in the proposals for rail retail implementation, and these will need to be resolved to meet desired Rail Reform outcomes.

In addition, the blueprint charts a timeline of recent Government U-turns and indecision, which arguably makes it impossible for any entity – private or state – to plan for a better future.

We conclude by making four recommendations, or key ‘asks’, which we believe will need to be delivered on if the shortcomings identified in the ‘Destination: Revenue Growth’ paper are to be overcome and the Government enabled to achieve its stated goals.

Summary of RIAs Key Asks

Key Ask 1 A Stable National Vision

Key Ask 2 Standardised and Specified Interfaces

Key Ask 3 A Level Playing Field

Key Ask 4 Common Contractual Frameworks

Structure of this report

This report has been produced with the assistance of RIA members and industry experts. A glossary is included, to avoid defining many unique terms within the text.

The body of the report consists of five main sections:

1. Setting the scene Introduces the report, explains why it is timely, and highlights its desired outcomes with regards to policy implementation and revenue growth.

2. Where are we on our journey? This section explores the landscape of UK rail retail today, developed through interviews and exploration of publications.

3. What is our destination? Examines the future of ticketing, including looking overseas for best practice, and establishes the relationship between an excellent customer offering and revenue growth.

4. How do we get there? Performs a gap analysis between UK policy, and what is being put into practice, examining recent relevant policy decisions.

5. Key Asks Makes 4 key asks of government which will to overcome the gaps identified in our policy analysis, to enable revenue growth identified in section 3.

A small selection of case studies of our members products and services is included. An appendix, ‘Where did our journey originate?’ contains some further background information on the history of railway ticketing, explaining how the system in use today came about.

Term/Abbreviation Definition

ABT (Account-Based Ticketing)

Advance Purchase Ticket

API (Application Programming Interface)

Assisted Travel

Bar Code

Booking Reference

BR (British Rail)

Contactless Payment

Concessionary Fare

Digital Ticket (E-ticket)

Dynamic Pricing

E-ticket

Fare

Flexible Ticket

GBR (Great British Railways)

Integrated Ticketing

Interchange

Interoperability

ITSO (Integrated Transport Smartcard Organisation)

A ticketing system where travel fares are linked to an account rather than a physical ticket.

A ticket purchased in advance of the travel date, often offering discounts.

A set of protocols and tools for building software applications, often used for integrating different systems.

Services provided to passengers who require assistance due to disabilities or additional needs.

A 1D or 2D visual representation of data that can be scanned for quick identification, often used on electronic tickets.

A unique identifier associated with a ticketed reservation.

The former state-owned and operated British railway network which included track and train.

A payment method where a device (e.g. card, smartphone) is tapped or waved near a reader for transaction processing.

A discounted fare typically available to specific groups, such as OAP's or students. These sometimes take the form of railcards.

An electronic ticket that can be stored on a mobile device or computer.

A pricing strategy where ticket prices fluctuate based on demand or time.

Electronic Ticket. See digital ticket

The amount paid for transportation services.

A ticket that allows changes to travel dates or times without extensive penalties or charges

A UK government initiative aimed at reforming, uniting and simplifying the British railway system.

A system where a single ticket covers multiple modes of transportation.

A location where passengers can transfer between different modes of transport.

The ability of different systems to work together seamlessly, in this context, different ticketing systems.

A specification for smart card ticketing used in public transportation. Originally established in 1973 as INTELSAT, the International Telecommunications Satellite Organisation was restructured in 2001. The restructuring led to the creation of a private entity, Intelsat S.A., and to the continuation of the intergovernmental organisation with a new acronym (ITSO)

Journey Planner

Loyalty Program

LUL (London Underground Limited)

An online or app-based tool that helps passengers plan their journeys using various modes of transport.

A system that rewards frequent customers with benefits or discounts.

The part of TfL that owns and operates the underground railway system in London.

MaaS (Mobility as a Service) Mobility as a service is a type of service that, through a joint digital channel, enables users to plan, book, and pay for multiple types of transport services. The concept describes a shift away from personally-owned modes of transportation.

Mobile Ticketing

Multi-modal Transportation

NFC (Near-Field Communication)

Onboard Ticket Purchase

Outbound Leg

PAYG – Pay as you go

Peak Time

Penalty Fare

Platform Ticket

QR Code

Rail Card, Railcard

RIA (Railway Industry Association)

Reservation

Return Leg

Revenue Collection

RFID (Radio-Frequency Identification)

Season Ticket

Smart Card

SME (Small or Medium Enterprise)

Tap-and-Go

The use of mobile devices, such as smartphones, for ticket purchase and validation. The most common type of E-ticket.

The use of multiple modes of transportation, such as trains, buses, and bicycles, within a single journey.

A technology enabling contactless communication between devices, often used in mobile ticketing.

Buying a ticket directly from a transport vehicle.

The part of a journey that takes a passenger away from their starting point.

No ticket required – just turn up, tap in and out to be charged the correct amount for your journey. Like TfL’s Contactless system.

The period when demand for travel is highest, often associated with higher fares.

An additional charge, or fine, imposed for travelling without a valid ticket.

A ticket that allows access to a train platform but not for boarding a train.

A 2D Bar Code (See Bar Code)

An identification card carried by a passenger which allows access to concessionary fares for particular types of travel.

The trade association representing the UK railway supply chain. The voice of the UK rail supply community.

A pre-booked seat or space on a specific train or transport service.

The part of a journey that brings a passenger back towards their starting point.

The process of gathering income from ticket sales.

Technology using radio waves for contactless identification and tracking, often used in smart cards.

A ticket valid for an extended period, typically over a single route, offering cost savings.

A plastic card with an embedded microchip used for electronic ticketing, often using RFID technology.

A business with a headcount of less than 250 people, and a turnover of less than £50m.

A contactless payment method where passengers tap their card or device for entry.

TfL (Transport for London) The local government body responsible for most transport in London including London Underground, London Overground, Elizabeth line and Docklands Light Railway. It does not control all National Rail services in London.

Ticket Barrier (US: Fare Gate)

TVM (Ticket Vending Machine)

Touchpoint

A physical barrier, often with a ticket reader, that controls access to a transport system, often arranged in a line for capacity reasons.

A self-service machine for purchasing tickets.

A point of interaction between a passenger and a service provider, such as a website or ticket machine.

Validation The process of ensuring that passengers have tickets, that they are genuine, and valid for the service travelled on.

Validity Period

The timeframe during which a ticket can be used for travel.

Wayfinding Systems and signage designed to help passengers navigate transport spaces.

Setting the scene: An introduction to this report

Past thought leadership papers

This section introduces this report, highlights its desired outcomes, and explains why it is timely.

This report follows two other RIA thought pieces: A Railway Innovation Strategy published in 2022 [3] and Data and Digital Technologies in Rail published in 2023 [4]. Both papers highlighted that the railway is undergoing significant change, and made simple, actionable recommendations to help ensure its continued success.

A Railway Innovation Strategy took a helicopter view of the railway innovation ecosystem: what worked well, what didn’t work so well, and what could be improved. It made six key recommendations on how to create an innovation-friendly environment: to deliver better value for the taxpayer, and a better experience for our customers. It made specific recommendations to GBR to enable the full, innovative capabilities of our brilliant railway supply chain to be brought to bear in the brave new world.

Data and Digital Technologies

in Rail paper flew that helicopter a little closer to the ground. Working with members, RIA made a detail study into one of the most rapid areas of innovation, and one that is changing the entire world around us at an incredible pace. We examined what external developments could mean for rail, should the industry be empowered to grasp the opportunities. The paper examined complex, cross-industry issues, noting that the railway was on the cusp of a digital decade, that digital change was inevitable, and that it was up to leaders to ensure that change was positive by enabling the supply chain to deliver. It identified key action points which could bring about meaningful change.

This paper lands that helicopter on a single-issue helipad. It is an issue with a simple title, but one which has stakeholders and effects as wide, if not wider, than any other element of the railway system. The factor upon which most revenue relies [6], the success of which can make, or break, whole railway systems. One in which changes to provision have raised public emotions like no other since Beeching [7]:

Ticketing.

Customers

Customers are the very reason for the railway’s existence, and fare revenue is what keeps transport systems running. Yet in collecting this revenue, the mainline railway puts in place many barriers which other transport modes do not. Some barriers, like the physical ones, are necessary due to the way the railway operates and its place in society but many are not [8] . Too often, the railway fines and punishes for simple mistakes, putting off occasional users, whilst failing to reward regular users. It denies flexibility, losing potential customers and in doing so, extra income, instead moving empty seats around [9]. It makes it complex to receive the legally entitled compensation for delays and cancellations [10], whilst giving downbeat passengers upbeat messages reminding them they are entitled to do so. The revenue element, instead of the verification and enforcement, is used as a stick, not a carrot.

Overhauling our outdated, clunky, untrusted, and confusing mainline customer ticketing and information provision, could make a significant positive difference to ridership and passenger experience [11] [12]. Ticketing is, of course, just one small part of the wider customer touchpoints of information provision, journey planning, retail, loyalty, revenue generation, revenue collection, journey validation and enforcement [13]. As in our previous papers, this paper makes several simple, actionable asks, such that the full expertise

and technology of the supply chain can be used to meet the promises of Williams-Shapps: improving the railway, increasing revenue, and accelerating decarbonisation efforts through modal shift.

Why Change?

But firstly, why change? After all, the system we have now is functional: as evidenced by passenger numbers already exceeding pre-COVID levels [14]

Change is a necessity if the industry is to achieve the promises of the WilliamsShapps review. [5]

Whilst we explore policy gaps in more detail under ‘How do we get there: Achieving the promises of Williams-Shapps’, our research amongst members identified three further compelling reasons:

● Climate change presents a burning platform like never before in human history [15]. There is not only a moral imperative to decarbonise, but bringing about that change is written into British law [16]

The railway is the cleanest and greenest mode of transport: no other mode comes close to its wholelifecycle carbon [17]. And furthermore, it does not need decades of uncertain R&D: it exists right now.

● There are many ways to encourage modal shift, but fundamentally, modal shift depends on the railway’s offering being right, which in turn depends on passenger experience. Passenger experience encompasses every customer touchpoint [18]. Quite aside from encouraging modal shift, the industry needs to universally recognise that customer experience is the prime driver of repeat business! With an enhanced experience, the railway needs no longer be a distress purchase: it can be the first choice, as it is in so many other countries [19] Increased ridership, for given fixed costs, also helps profitability and reduces reliance on subsidies.

● The financial landscape of the current era is very different to that of the recent past, and all predictions indicate it will continue to be so. Like many other service provisions, Government position is that the railway needs to be more financially sustainable [20]. Many networks, including TfL, have seen the benefit of revised ticketing provision upon customer satisfaction, ridership numbers, and subsequent revenue [21]. Revisions could include cutting fares – short term pain for long term gain – but they do not have to. If simple changes can increase utilisation of mainline railway’s assets and increase revenue, it is imperative we make them: change is a necessity.

The British mainline railway is on the brink of the biggest structural change since privatisation in the 1980s [22]. In an industry where long financial cycles

mean that stability is a key contributor to costs and competitiveness, the recent past has seen constant political U-turns, hiatus, and reversed decisions (see page 12). It is vital to start this new era working towards a shared vision which can prevail despite any political winds of change. The advent of GBR is not just an administrative change but a call for this visionary leadership, for sound strategies based upon available facts to underpin that vision, and the political will and resources to see it through. Hence, the need for a unified vision forms our first key ask.

Cash accepted here: growing revenue without changing fares

Despite a large part of the motivation for change being financial, this paper will not broach the topic of fare structures or pricing beyond this paragraph. Numerous other organisations lobby on fares and pricing [11] There is demonstrable evidence provided in numerous scientific studies that selectively lowering fares increases ridership, which increases overall revenue [23] [24], and that fare structures can have a significant negative impact upon minority groups [25] [26]. However, with the third change motivator above in mind, RIA appreciates Treasury is likely not positioned to sustain the short-term pain necessary for this long-term gain. Indeed, it is likely the short-term pain could be used as a justification for managed decline.

Instead, this paper focuses on changes which cost the public purse little to nothing, but which can give the supply chain the right environment to deliver an exceptional customer experience, and the railway to prosper as a result. It highlights what supply chain, and the wider industry, could achieve with the right framework in place through those changes, and not what the treasury could achieve by tweaking the dial on fares. Interoperability and a level playing field – our second and third key asks respectively – really highlight this point. Several case studies, at the end of the document, offer examples of what can be achieved, given the right environment. What supply chain needs is that environment. Changes which cost the taxpayer little but can bring in extra revenue – what’s not to like?

This is an important point. The earlier two papers of our trilogy explicitly asked for further investment in specific areas. This paper does not. Instead, it points out changes which can underpin increased income through future revenue by enabling implementation of existing policy goals. Supply chain is willing to pay to play its part, which includes significant investment if the key asks are fulfilled. Nowhere has this commitment been better demonstrated than through the recent privately-financed rollout of barcode ticketing across the national network [27]

Where are we on our journey?

This section presents an overview of the landscape of UK rail retail today. It has been developed through interviews and exploration of research, policy, and industry publications.

UK railway ticketing today

“Confusing.”

This section examines the complex and confusing system we have today, and how our system compares to offerings overseas. If you are interested in finding out about all the historical events and changes that have led us here, we have also included an appendix called “Where did our journey originate?

A brief history of UK railway ticketing”, containing interesting historical events and facts, on page 47.

Our brief history of ticketing likely gives an indication that today’s system is rather complex, full of historical hangovers, and has many stakeholders. The stakeholders have many competing goals and measures. They are more than passenger, operator, and government, as this landscape has been complicated in recent decades with the policy of devolution. Operators’ services may pass through the jurisdiction of many devolved authorities and PTE’s, and even countries (see info box on page 13). This is one of the reasons why, outside of London’s single authority area, it is rare to see end-to-end journey ticketing provision.

There is plenty of evidence to show that what we have is a not an optimal solution for passenger experience. In fact, when surveyed, one of the most common words passengers used to describe mainline railway ticketing was ‘confusing’ [28]. Confused passengers are not passengers that want to change the occasional distress purchase into a regular commute or sell their car. It is not just the ticketing itself which confuses;

several customer touch points have similar effects, and this effect is magnified for those with additional needs. It is almost as though the system is made for machines, not for humans.

Computerisation of ticketing in the 1980s–1990s made it simple to create new fare types, and distancebased pricing was dropped in favour of ever more complex regimes, ostensibly to manage demand and revenue. These regimes include demand-pricing, and peak, off-peak and super off-peak fares with variable implementations times depending on operator and location.

It could be argued that the free market response to this complexity has only served to add more, with screen-scrapers and resellers offering savings through initiatives such as split ticketing. In a twist that can only be termed ‘bizarre’ – split ticketing is now recommended by the operators themselves [29] as best practice for saving money!

This has led to:

● Widespread confusion as to the complexity of myriad fares available [30] (around 55 million [11]).

● An acceptance that it is normal to not have received the best available deal for any particular journey without the assistance of a ticket office [28] .

● Travellers having an underlying sense of fear arising from the potential of having accidentally bought the wrong ticket [28]

On the mainline, some negative aspects of past systems have been carried forward into the era of e-ticketing. The implementation of e-tickets has very much been a process of technology change rather than simplifying underlying principles. E-tickets – a ticket for which confirmation is granted electronically in place of a printed ticket – have been the dominant form of ticketing on the mainline railway since 2019.

“Many passengers have shifted how they buy train tickets too. However, some people told us they have changed their purchasing behaviour elsewhere, but still prefer to purchase their train tickets at the station. They say buying train tickets is different, primarily due to: complexity – purchasing a ticket can feel less straightforward due to the complicated ticketing structure and the number of considerations to get the right ticket (date, time, peak/ off peak, single, return, route and so on);

risk – the perceived high risk of buying the wrong ticket and concern about losing money if they do.”

Source: Transport Focus [28]

Passenger Transport Executives and Devolved Authorities

Passenger Transport Executives (PTEs) were established in the 1970s, through the Local Government act [33], in response need for greater coordination of transport services in major metropolitan areas. The act empowered, but did not force, local authorities in England and Wales to establish Passenger Transport Authorities (PTAs) and Passenger Transport Executives (PTEs).

Notable PTEs include Greater Manchester (TfGM), West Midlands (Centro), Tyne and Wear (Nexus), South Yorkshire (SYPTE), and West Yorkshire (Metro). Responsibilities varied and sometimes included ticketing policy. The PTE’s manage transportation services across multiple modes, including buses, trams, and local rail services. Whilst it was possible to co-ordinate timetables, for many years outside of London, there was rarely a ticketing or informationprovision solution which spanned every mode. It is only in the 21st century that this has begun to be achieved.

Devolved authorities in the United Kingdom started to gain responsibility for transport during the late 1990s with the establishment of devolved administrations in Scotland, Wales, and Northern Ireland. Devolved authorities, such as the Scottish Government, the Welsh Government, and the Northern Ireland Executive, have powers over broader policy areas, including transport, and they can make decisions on regional or national transportation strategies. In England, the devolved authorities instead cover regions, for example, Transport for the North. On the other hand, local passenger transport executives, like Transport for Greater Manchester (TfGM), operate at a more localised level within a specific metropolitan area or city region. Here are the key differences:

Devolved Authorities:

1. Geographic Scope:

Cover entire countries or regions (Scotland, Wales, Northern Ireland).

2. Decision-Making Authority: Make decisions at a regional or national level, setting policies and strategies that affect the entire jurisdiction.

3. Transport Responsibilities:

Responsible for shaping overall transport policies, managing major infrastructure projects, and coordinating transportation strategies on a broader scale.

Local Passenger Transport Executives/Authorities:

1. Geographic Scope:

Operate within specific metropolitan areas or city regions, focusing on local transportation needs.

2. Decision-Making Authority: Make decisions at a more localised level, addressing the unique transportation challenges and needs of their specific area.

3. Transport Responsibilities:

Responsible for the day-to-day planning, management, and improvement of local public transportation services, including buses, trams, and sometimes local rail services.

4. Collaboration with Devolved Authorities: Collaborate with devolved authorities and national bodies to align local transportation strategies with broader regional or national policies.

Example: Transport for Greater Manchester (TfGM):

Geographic Scope:

• Operates in the Greater Manchester metropolitan area.

Decision-Making Authority:

• Focuses on local transportation issues within Greater Manchester, making decisions that impact the daily travel experiences of residents and commuters in the region.

Transport Responsibilities:

• Manages and plans local bus services, trams, cycling initiatives, and other transportation modes within the Greater Manchester area. Involved in the development of local transport infrastructure projects.

Collaboration:

• Collaborates with national bodies and devolved authorities to ensure that local transport plans align with broader regional or national strategies.

Giving authorities and PTE’s autonomy around ticketing and retail is a natural step in devolution, however it has a significant impact on the ability to create a national strategy for ticketing. Without open interface specifications, this could lead to islands of incompatible ticketing technologies which would always prevent end-to-end ticketing in certain regions. Our key asks explore this in more detail.

MEMBER QUOTE:

We shouldn’t underestimate the power of trust in purchasing decisions, it’s the psychology that underpins people buying branded goods. The brand of TfL is trusted, yet I think it is fair to say that absolutely none of the fragmented brands associated with the mainline railway are – if people even know them, that is! How often do you hear the public confuse ‘National Rail’ and ‘Network Rail’? We need to ensure the GBR brand becomes as trusted as TfL. The only way to build lasting trust is to be trustworthy. Things like split ticketing, random start times for off-peak tickets, a lack of transparency, they do not build trust. Equally, trust is easily lost, and TfL should be careful not to do anything to lose it.”

They are dependent, of course, on smartphones and ubiquitous data access. Not all passengers can access such technology, and fallbacks must be ensured. In 2023, The government’s proposed cost-cutting removal of one of those critical fallbacks – ticket offices – produced the biggest public outcry about railway provision since the Beeching cuts. This resulted in a U-turn [31]. The uproar focussed firstly on a lack of provision for those who could not use e-ticketing and digital solutions. Secondly, there was a lack of trust

Over-pay as you go: The troubled extension of the contactless zone onto mainline

Trust is an important theme in any move to account-based ticketing. Soon-to-be released research has shown that the expansion of contactless payments beyond the current travelcard zone are importing confusing mainline pricing to TfL, rather than offering passengers best value.

The PAYG scheme has been extended from the original Travelcard zones to locations such as Gatwick, Luton and Reading amongst others. An additional 53 stations are due to be added soon. The expansion to longer distance, higher value journeys on the National Rail network has introduced complexity and unfairness for passengers by creating different fares when paying via PAYG, vs other means of buying a ticket. When PAYG was introduced in the London Travelcard area, paying via PAYG was made cheaper than other

methods of buying a ticket, thereby encouraging customers to migrate. A side effect of this, however, is that digital channels, like mobile ticketing, which better suit some customers’ needs, are also not able to offer customers the best fare. The difference in fare can be significant – up to 50% in some cases. Depending on the journey, sometimes PAYG will be cheaper, and sometimes other means of buying a ticket will – and there is no clear way for customers to discern this.

As a result, PAYG has made it more complicated for customers to obtain the best fare for their journey – and customers often pay more than they need to.

RIA members felt strongly that customers should pay the same fare, and benefit from the same capping regime, regardless of how they choose to pay for their

travel. Customers must have trust and confidence that the price they are being asked to pay is the right one, regardless of their preferred payment method. Two important principles should be adopted to help achieve this:

1. The same fares should apply, regardless of how a customer chooses to pay, especially via mobile apps, which now account for more than 50% of all tickets sold.

2. All channels and retailers should be allowed to offer customers thebenefits of daily/ weekly capping

There is no technical impediment to allowing other retail channels to charge the same fares, it is purely a matter of policy. One of our key asks challenges this policy, for the benefit of the customers, and to maintain TfL’s hard-earned trust.

that an automated system would not be purposefully, or inadvertently, overcharging, without a human in the loop to point out the multitude of rules, counter-rules, and ways around them all. The irony, of course, is that trusted human usually works for the company that stands to gain from mis-selling.

In contrast, the TfL network has captured the absolute trust of the travelling public. A simple and clear fare structure, daily and weekly caps, tight integration with other transport modes, and an online portal where

journeys could be reviewed and any discrepancies challenged, Oyster and contactless are used daily, without question, by the travelling public. Within a decade of launch, over 80% of annual journeys in the capital were made using the card [32]. This demonstrates the general public’s appetite for simplicity and convenience. It also underlines the railway industry’s ability to deliver a complex, multistakeholder technology project in a very challenging environment, to great benefit.

Destination: Revenue Growth

Statistics

Silver Rail’s 2023 ticketing survey [30] found that: “Complexity proved to be the biggest issue in train travel, with a fifth of travellers (20%) unable to find the cheapest ticket for their journey and 58% believing there are simply too many ticket options, with this number increasing to 71% among those aged 65+. From ‘peak’ to ‘offpeak’ to ‘super-off-peak’, the industry jargon confounds 19% of the population. Our research showed that it was the most vulnerable who struggled most, with more than a quarter (26%) struggling to secure the cheapest ticket, and 69% overwhelmed by the sheer variety of tickets on offer.”

Retail is not just about selling tickets. The Transport Focus Rail User Survey [34], published in January 2024, shows that only 75% of users are satisfied with the provision of information during the journey, a drop from 77% compared to the previous report. Even worse, satisfaction level about the information on how busy train would be is only 63%, down from already low 65%. Level of crowding is among the most important factors for overall journey satisfaction, coming only after punctuality and reliability. Giving customers access to good quality data would help alleviate these issues. The key point here is that being accurate and reliable in communicating train crowding is enough to improve passenger experience, rather than having to solve the overcrowding itself.

According to the Office of Rail and Road, trends in mainline ticketing revenue are generally upward with increases in passenger numbers and fares contributing to growth. However, there have been fluctuations due economic conditions, industrial action, changes in Government policy and most notably, COVID-19. Between 2014-2015 [36] and 2018-2019 [37] , ticketing revenue increased by around 17%, from £8.3 billion to £9.7 billion. In the financial year 2019-2020 [38], the UK rail industry generated £10.3 billion in revenue from ticket sales. This represented around 73% of the industry’s total revenue. To make an international comparison, according to the International Association of Public Transport’s (UITP) 2019 statistics [39], ticket revenue accounted for around 63% of total passenger revenue for rail transport in Europe (excluding Russia). This figure includes both urban and intercity rail services.

Govia Thameslink Railway surveyed consumers around e-ticketing in 2022 [35]:

• 58% of respondents said they would travel by train after hearing more about smart tickets, rising to 84% among Gen Z (16–24 year-olds).

• 62% of consumers said nothing would prevent them from using a smart ticket.

• Making travel easier (35%), removing the stress of losing paper tickets (35%) and to guarantee the best value fare (28%) were the most popular benefits of smart ticket usage.

Ticketing and other transport modes

There are numerous comparisons which can be drawn around ticketing upon other modes of transport. However, the correlation we believe most relevant to this paper is between how recent the mode of transport became common, and the type of ticketing, either walk-up or account-based.

Older types of mobility, which became common before the digital era, tend to be walk-up; for example metros, buses, some longer-distance coaches and traditional taxis. With modernisation, if paying for any transport under TfL’s Oyster or contactless system, the card information is logged and the passenger can later log onto the website to examine fares [40]

More recent mobility solutions, for example, Uber, Lyft, Lime, and Tier, are based entirely around accountbased ticketing. Users are more likely to choose these modes from a range of competitors, and the ease of booking or paying on an app is part of the customer service offering. These modes would simply not function without an account-based system [41]. These modes also almost exclusively use distance- or timebased pricing.

Airlines occupy both camps: whilst passenger details need to be known for security and border reasons, a ticket only really becomes account-based with a frequent-flyer number. Historically, the airlines

competed heavily on their frequent-flyer offerings to help gain market share: free upgrades, flights and flexible tickets were common rewards. More recently, the advent of no-frills airlines has cast doubt on the value of rewards and status vs striving to offer the lowest possible fare. This means the average shorthaul airline ticket is now closer to a walk-up offering. Pricing is defined by distance, time, and demand.

These comparisons are important because, if crossmodal tickets are to be sold which include the railway as part of the journey, it is important to understand the sales and pricing model of the complementary modes.

What is our destination?

This section examines the future of ticketing, including looking overseas for best practice. Most importantly, it establishes the relationship between an excellent customer offering and revenue growth arising from growing passenger numbers.

The future of rail and wider transport retail

RIA’s Data and digital technologies in rail [4] report outlined an ideal future scenario in the railways’ passenger offering. It stated:

“Passenger journeys will be interlinked. From leaving the front door, through all transport mode changes, to arriving at their destination. Optimum mode changes

will be calculated and communicated for them. Information given to passengers will be accurate, tailored and timely. Railways will be a competitive option among other travel modes, offering convenient, affordable, reliable, and connected journeys.

Through Account Based Ticketing (ABT) there will be a single digital payment for the whole journey either as part of a subscription service or as a pay-as-you-

What did our members and experts say?

“Hardware will be minimal, with traditional ticket vending machines morphing into wayfinding technology or help points. Account-based ticketing will likely replace the need for validators and smart card schemes. People will use their bank cards or mobile devices for seamless ticketing. Gates are important for revenue capture so I don’t think they’ll disappear overnight. Future gates may use biometrics for simplicity and speed, if we overcome the ethical concerns.”

“There is a trend towards account-based ticketing, where the authority to travel is stored in a database rather than on a physical ticket. However, there is ambiguity about who should own these accounts: retailers or railway companies. There is no right answer, but the outcome of decisions like these lead to quite different futures.”

“The future if we don’t do anything, is multiple back offices, multiple customer propositions, lack of interoperability. Unfortunately, if you’re a customer, you’ll likely be fine near where you live, but the minute you step out of that area, it will be incredibly confusing – potentially more confusing than it is for customers to travel today.”

“Now, there’s no trust. We aren’t trusted because of our complexity, there are so many rules. Rules on top of rules. Exceptions to the rules. And, for example, when the official advice starts recommending split ticketing to hack our own pricing structure, rather than just fixing the structure, that doesn’t help. People are scared to use the railway because ticketing is complex and getting it wrong can get you fined. In the future, I’d like there to be simplicity and trust. TfL have that already.”

“Imagine a future where there are no tickets, no gate lines, maybe even no bookings. You just travel. What does it? Well, it is kind of irrelevant. It could be biometrics, could be GPS location, it could be anything, but really, I’m not talking about specific technologies because we should be looking for the future customer proposition then seeing how we deliver it.”

go option. The cost for this journey will be calculated across all transport modes, offering the lowest fare.

Railways will be fully integrated into wider MaaS systems, sharing data across transport modes, and allowing the account holder to access targeted offers, upgrades and renewals.”

During the production of this paper, we interviewed many members and industry experts. The question

interviewees most enjoyed answering was simple and open-ended: “What do you see as the future of ticketing?” Responses varied, some concentrating on technology, some on customer experience, and others on vision, strategy, and deployment. Overall, the responses confirmed RIA’s earlier vision is still timely and relevant.

“I find it funny that no-one ends their journey in a railway station, yet they are the only destinations we sell tickets to. We need to ensure we are part of the wider provision of transport, whether that’s full mobility as a service or just simple things like lining up timetables with other modes, and giving clear information. I think multi-modal tickets are part of that offering. That likely mandates a full account-based setup and we have a lot of interoperability challenges to solve to get there.”

“In the future, ideally ticketing would be personalised, fully integrated with other modes of transport, and made more efficient and userfriendly. This would require standardisation of both the back end and the front end of ticketing systems.”

“Future scenarios for technology implementation could follow two routes: a single supplier, large project approach, and a multi-vendor, incremental implementation approach. It’s not for me to say what the right route is, but what I will say is that either route has benefits and pitfalls, and we need to go in with our eyes open.”

“In the future, we need a world where, as a customer, you have your preferred media, whether it’s your bank card, smart card, phone, or something physical that you have, because everyone’s needs are different. People should be able to travel effortlessly without necessarily planning in advance. They can just tap or check-in at the station, travel with confidence, and be charged the right amount for their journey.”

“You find your journey, you pay for it. The operator validates it. You get information and a refund if something happens. Those are the basic customer expectations. We need to do the basics well consistently as a foundation. Currently, we do not.”

“I think the future could potentially see the removal of physical tickets or gate lines, relying on various technologies for journey validation.”

“Integrating ourselves into wider information and ticketing would be a great start. Booking a train ticket doesn’t start with the booking app or timetable. It starts with: where’s the nearest station, how can I get to my destination from it, how long will that take, do the buses run that late, can I take my pram onboard, and more. First and last miles are a very effective psychological barrier. Integration needs to extend to, for example, if your bus to the station gets held up and you miss your booked train, you are not penalised, instead, how about the ticket provider apologises and compensates. The commercials between modes for revenue and risk split are a real challenge and it would likely need some sort of independent body or contractual framework, but you asked for my dream future so that’s it. Take all the stress away. Be on the side of the customer. That’s how we grow.”

Growing revenue through good customer experience: The relationship between ticketing, experience, revenue, and subsidy

Information provision, retail and ticketing contributes significantly to overall passenger experience, therefore greater customer satisfaction contributes to financial sustainability [42]

The relationship has been explored in literature. For example, in aviation, a 1% increase in satisfaction scores leads to a 1.5% increase in non-core revenue [43]

Research work for HS2 identified that creation of a memorable and enjoyable passenger experience on trains is vital for the economic success of railway travel [44]. This was a key message in an extensive survey that was undertaken by McKinsey in 2018 and where the relationship between high user experience and increased revenue growth was highlighted [45]

An independent research report recently commissioned by RIA examined various scenarios for future growth of passenger numbers on the UK mainline network [46]. The report explores the potential effects of various factors, both inside and outside of the railway’s control. “The ‘customer offer scenario’ establishes the additional growth stimulated by activities and policies that enhance the customer and service offer, and provide an attractive product including revenue management, marketing, fares and ticketing.”. The report states these will have most predictable impact in growing the market over the next decade. Note that this does not include lowering fares.

Modelling demonstrates that providing a better customer service offer could contribute to growth in passenger numbers of between 37% and 97% by 2050 – a combined annual growth rate of 3%. Simply put: if the correct changes are implemented now, revenues could grow by an equivalent amount, in real terms, over the next 25 years, which could represent a significant reduction in subsidy.

Future trends in railway ticketing*

The future of railway ticketing is likely to see continued developments in technology and changes in the way that passengers purchase and use tickets. Here are a few potential trends that could shape the future of railway ticketing:

Mobile ticketing: As more people use smartphones and other mobile or wearable devices, mobile ticketing is likely to become an increasingly popular option for purchasing railway tickets. Mobile ticketing allows passengers to purchase and store their tickets digitally, reducing the need for physical ticketing options.

Contactless payment: With the increasing popularity of contactless payment methods, we may see more railway operators adopt contactless payment systems for purchasing tickets. This could include options like using a contactless card or mobile payment method to purchase tickets directly at the station.

1 2 3 4 5

Personalisation: With advancements in technology, it is becoming easier to track passenger journeys and preferences. This data could be used to personalise ticketing options and pricing to better suit individual passenger needs and preferences.

Integrated ticketing: Integrated ticketing systems, which allow passengers to purchase a single ticket that covers multiple modes of transportation, could become more widespread in the future. This could make it easier for passengers to plan and purchase their journeys across different modes of transportation, including trains, buses, and even bicycles.

AI and chatbots: As AI technology continues to improve, we may see more railway operators using chatbots and other AI-powered tools to assist passengers with ticketing and other inquiries. This could help to reduce wait times and improve the overall customer experience.

Overall, the future of railway ticketing is likely to be shaped by advancements in technology and a greater emphasis on personalisation and convenience for passengers. As railway operators continue to explore new ticketing options and improve the overall customer experience, we can expect to see more efficient and user-friendly ticketing systems in the years to come.

*Further reinforcing point 5 above, this information box was created by prompting ChatGPT 3.5 for 300 words on future trends in mainline railway ticketing. No genuine references were provided.

A look overseas

“One of the best systems I have seen overseas is in the Netherlands. It may not be directly applicable to the UK, as it is a much smaller country with a lot less fragmentation. But it is something to aspire to.”

“We’ve always had a habit of being very introspective in the UK market. Politically, we might face different challenges, but the actual experience that passengers want, and that which the transport industry is able to give them, is broadly similar.”

“Did you know that in Canada, if you book a space for your hunting rifle, then on the return journey you not only get an automatic booking for your rifle but also an animal carcass? Our provision for bookings that aren’t just a bum-on-seat, such as bikes, pushchairs, wheelchairs, extra assistance, leaves a lot to be desired in terms of customer journey.”

“Outside the UK generally they are better set up to deliver change. The UK thinks it has a sort of command and control of the market, yet it has neither. Whether it’s the sort of consortium approach seen in the United States, or the sort of government or local authority model like in Europe, they all seem to have a much easier ability to specify what they want, what they are going to go to market to get, and where they’re heading in future. Our government can’t decide what it wants or how it wants to buy it.”

“Trying to compare the UK with overseas is apples and oranges. We have a level of fragmentation through government, leadership, implementation, and delivery that I have not seen replicated in any other country. It leads to expensive and slow changes.”

“Look to home! There are few cities in the world as good as London where you get the railway as high-capacity arteries, with the wider ticketing system offering the sort of seamless cross-modal integration and contactless for ease of use. We shouldn’t forget that. However, what passengers experience when leaving the TfL bubble and going to mainline or to other cities is a very stark comparison. We in the industry know that the challenges are very different, but the passengers don’t care about that: the quality and consistency they see in TfL’s offering puts mainline ticketing to shame.”

“Switzerland is probably the utopia, complete standardisation across a state-run network and a public that trusts that network implicitly, but the German network is also state-run in a wildly different fashion but has achieved the same.”

“Ireland and the UK have implemented the same software backend. The Irish version is off-the-shelf. The UK version was heavily customised – making it more expensive – and it has loads of features turned off. In the UK, the process for changing ticket prices and assigning revenue takes months and months. So, if you decide on a change its nearly a year before you see the difference show up in the balance sheet – we just can’t be agile. In Ireland they can change prices in a day, assign revenue the day after, and you see the difference to travel patterns instantly.”

“Looking overseas, we should learn from successful examples in places like Brisbane, New Zealand and Tasmania, where they have achieved success with multioperator, multi-tenant back-office systems. Ireland is working towards a unified ticketing system for the entire country. However, it is also essential to consider the failures in some European cities attempting regional ticketing, as they lacked proper leadership, budgeting, and data sharing.”

Members and expert opinions:

Members and experts interviewed during the production of this paper came up with a wide range of examples of best-practice abroad. There was little agreement on where was ‘best’, but lots of agreement that there are too many variables upon which to judge such a measure! Answers yielded a mix of what systems were better from the perspective of the passenger, or operator/government.

Several cited TfL as best practice for urban ticketing. However, most agreed that outside TfL, the mainline and regional situation here at home was unnecessarily complex and confusing when compared to many overseas jurisdictions, which have rationalised their ticketing and revenue offerings through the 20th and 21st centuries.

Notable mentions are for those countries which have implemented, or nearly implemented, fully, or almost-fully integrated ticketing systems, like Japan, Germany, Austria, Ireland and Switzerland. These allow passengers to purchase tickets for multiple modes of transportation on a single platform or app, throughout the country.

Distance-based pricing is common on the railways, but not ubiquitous. Post 1960s, Britain instead adopted a hybrid model using location, distance, time, demand, and a fudge factor. Pricing models much closer to distance-based are still common in numerous places: for much of China’s high-speed system, SNCF in France, in Singapore, in South Korea and Switzerland.

Customer opinions

Of course, the customer is always right, so we should ask their opinions! Unfortunately, it is difficult to compare worldwide satisfaction levels as there is no globally applicable survey mechanism. Use patterns vary, along levels of infrastructure development, influencing expectations. In Europe, however, the European Union has done exactly that, surveying over 25,000 travellers in the Europeans’ satisfaction with passenger rail services survey. The survey conducted in 2018 [47], being pre-Brexit, included the UK. The UK ranks highly across all opinion categories.

There is, however, a catch: the respondent rates do not reflect typical UK rail usage rates, with only 20% of those surveyed ‘non-rail users’. The very demographic who are accustomed to the intricacies of our ticketing system were heavily over-represented. More telling, those who did not take the train reasons which may include ticketing and information provision, were significantly under-represented, and it is this groups whose input would perhaps be most useful. It is unclear if this pattern is represented in other countries.

As a general observation, systems that consistently score highly in terms of passenger satisfaction tend to have easier to use, modern, integrated ticketing that offers a clear range of options and features to passengers.

Satisfaction with rail services and train stations [47]

a. Getting information

Information about timetables and platforms

Almost three quarters of respondents (74%; among rail travellers 81%) are satisfied with the provision of information about train timetables and platforms.

Q4.1 Are you satisfied or not with the following services related to rail travel? Provision of information about train timetables and platforms (%)

one is

Information on connecting services with other modes of transport

Six in ten respondents are satisfied with the provision of information about connecting services with other modes of transport (60%: among rail travellers 65%).

Q4.4 Are you satisfied or not with the following services related to rail travel?

Provision of information on connecting services with other modes of transport (%)

Base: all repondents (n=25,537)

Destination: Revenue Growth

b. Getting tickets

Ease of buying tickets

Three quarters of respondents (75%: among rail travellers 81%) are satisfied with the easiness of buying tickets.

Q4.2 Are you satisfied or not with the following services related to rail travel?

Ease of buying tickets (%)

Availability of through-tickets

Almost two thirds of respondents (64%: among rail travellers 71%) are satisfied with the availability of through-tickets.

Q4.3 Are you satisfied or not with the following services related to rail travel?

Availability of through-tickets (i.e. one ticket for several segments of one whole journey by rail) (%)

Base: all repondents

Availability of tickets for a journey using several modes

More than six in ten respondents are satisfied with the availability of tickets for journeys using several modes of transport (62%; among rail travellers 67%), with 20% very satisfied.

Q4.5 Are you satisfied or not with the following services related to rail travel?

Availability of tickets for a journey using several modes (i.e. tram, metro, bus, local trains) (%)

Base: all repondents (n=25,537)

c. Handling complaints

Easy and accessible complaint handling mechanisms

Almost four in ten respondents (38%; among rail travellers 40%) are satisfied with easy and accessible complaint-handling mechanisms, with 10% very satisfied.

Q4.6 Are you satisfied or not with the following services related to rail travel?

Easy and accessible complaint- handling mechanisms (%)

How do we get there?

This section explores current UK Government policy, performing a gap analysis between what has been promised and what is being made reality. It also examines recent policy decisions of relevance to ticketing and retail.

Achieving the promises of Williams-Shapps

Regardless of RIA’s future predictions, overseas best practice and ChatGPT’s opinions, there is a single source of truth on the Government’s rail reform agenda: 2021’s Williams-Shapps plan for rail [5]. The plan is clear in its aspirations, and indeed its opening section titled ‘Our promise to passengers and freight

customers’ lays out, in concise terms, seven basic principles which the policy seeks to implement. Two of these are directly applicable to retail.

Next pages give 10 outcomes that show ‘How the railways will change for the better’. For those outcomes which are relevant to ticketing and retail, RIA has examined each claim and performed a gap analysis in the table below.

The Williams-Shapps review’s promises to passengers:

We will make the railways easier to use. We will simplify the confusing mass of tickets, introducing far more convenient ways to pay using a contactless bank card, mobile or online. We will end the uncertainty about whether you are travelling with the right train company. Trains will be better planned with each other and with other transport services, such as buses and bikes. Affordable ‘turn up and go’ fares and capped season tickets will continue to be protected.

We will rebuild public transport use after the pandemic. In line with the COVID-19 roadmap, we will continue to work closely with the sector on measures to enable people to have confidence to travel again and to support their new working patterns. New flexible season tickets will be introduced to begin this journey.

Destination: Revenue Growth

Outcome

1. Modern passenger experience.

Passengers must receive high-quality, consistent services day in, day out. This means accessible, reliable journeys that are well connected with other transport services and include new customer offers at stations and on trains.

Relevance to ticketing and retail

Highly Relevant

Gap analysis

• Multi-modal transport ticketing is not fully implemented outside London. In other urban centres it is in most cases only with a limited range of mobility options. Accessible, reliable journeys are underpinned by accessible and reliable journey information, and this is still an aspiration.

• Some new customer offers will need to be underpinned by ticketing and retail provision but it is unclear what the vision or delivery mechanism is.

• Consistency must include consistency of pricing and availability across ticket types, payment and delivery mechanisms, which is not currently being met with a risk it will soon deteriorate further (see ‘[overpay as you go’])

2. Retail revolution…

A new customer offer will be driven by clearer, easyto-understand information, simpler travel with contactless and cashless payment and clearer prices. Compensation will be simpler to claim and journeys will become easier across transport services.

Highly Relevant

• A new customer offers will need to be underpinned by ticketing and retail provision but it is unclear what the vision or delivery mechanism is.

• Clearer prices must include consistency of pricing and availability across ticket types, payment and delivery mechanisms, which is not currently being met with a risk it will soon deteriorate further.

• Simpler and/or accelerated compensation claims will either require account-based ticketing or a significantly streamlined backend process and technology stack.

• Contactless and cashless alone are not the answer without trust in the system. There is little trust in mainline retail, and it is unlikely to exist with current levels of complexity.

Problems with the existing system have been known about, and repeatedly highlighted by passenger advocacy groups for many years but little has changed. The vision for what the future looks like to overcome these concerns is still not clear here.

Mapping to our Key Asks

A Stable National Vision Standardised and Specified Interfaces

A Level Playing Field

Common Contractual Frameworks

A Stable National Vision Standardised and Specified Interfaces

A Level Playing Field

Common Contractual Frameworks

Destination: Revenue Growth

3. New way of working with the private sector. Passenger Service Contracts will replace franchising, bringing a new focus on reliability, performance and efficiency. New opportunities for innovators, suppliers (including small and local partners) and funders will be created through streamlined contracts and more contestability.

Some Relevance

• There is no vision or plan on how to reform systems countrywide, meaning that it is very hard to engage private sector to bring forward useful, innovative ideas. Best value from the supply chain comes from a vision and outcomes-based procurement to achieve it. TfL did this well with Oyster and contactless.

A patchwork quilt of legacy systems underpins daily operations, procurement is focussed upon each small part of the jigsaw rather than the big picture. Retail is a series of interrelated systems that need to be planned and thought about as a whole system.

• Commonly used procurement methods add significant delay, limits innovation, and does not deliver best value for the taxpayer. A future iteration of innovation partnerships should be considered.

A Stable National Vision

Standardised and Specified Interfaces

Common Contractual Frameworks

4 Economic recovery and financially sustainable railways.

The railways are a public service, paid for by taxpayers and passengers to connect places and foster economic growth through levelling up across our towns, cities and regions. Bringing together responsibility for cost and revenue across the system will ensure the railways become more financially sustainable

Some Relevance

• Growing revenues is key for financial sustainability. The existing retail system impacts customer experience, in turn impacting ridership and revenue.

• Innovation in retail has been slow, partial, and where it has happened, largely brought about by the private sector – e.g. barcode ticketing. Instead, innovation should be championed to grow revenue, but currently, innovation is stymied, in part through the lack of a level playing field and stable vision.

• For intermodal transportation, rail is not doing enough to integrate with other forms of transport. This requires a keener vision and could be supported by common contractual frameworks.

A Stable National Vision

A Level Playing Field

Common Contractual Frameworks

5. Greater control for local people and places. Railways will be more responsive to the needs of local communities and customers, whether from Woking, Wrexham or Wick. Empowered, locally-led teams will support levelling up and be accountable to the people and places they serve.

Minor Relevance

6. Cleaner, greener railways.

The UK railways can and will spearhead the nation’s ambition to become a world leader in clean, green transport. Decarbonisation, greater biodiversity and improvements in air quality in towns and cities will ensure rail is the backbone of a cleaner, greener public transport network.

8. Increased speed of delivery and efficient enhancements.

Restoring lost rail links and accelerating the delivery of critical upgrades to the network will help level up places across the country, spark new economic growth and improve public transport connectivity and prosperity across our nations and regions.

Some Relevance

• There is a need to offer crossmodal tickets which are unique to each particular locale without creating excessive administrative burden. This means transport provision can be aligned to local needs and national strategy. Common contractual frameworks could help in this regard. Customers need the confidence they will get to their destination on time. Additionally, they need to know that if one leg of their journey is disrupted, the providers of other legs will remain flexible.

• The points above need a common vision for structure and responsibilities of each and every stakeholder.

• Modal shift can be underpinned, in part, by offering a 1. Modern passenger experience to encourage more people to choose rail – refer to those gaps.

Destination: Revenue Growth

A Level Playing Field

Standardised and Specified Interfaces

Common Contractual Frameworks

A Stable National Vision Standardised and Specified Interfaces

A Level Playing Field

Common Contractual Frameworks

Some Relevance

• Multi-modal transport ticketing is not fully implemented outside London. In other urban centres it is in most cases only with a limited range of mobility options.

The cost and time it takes to deliver retail systems when through a centrally-planned or state-led mechanism is excessive. Private sector should be given room to innovate, but within defined bounds and with clear outcome specifications.

• A lack of government procurement competence, or unwillingness to utilise all available procurement methods, adds significant delay, limits innovation, and does not deliver best value for the taxpayer.

A patchwork quilt of legacy systems underpins daily operations and retail (refer to RIA’s earlier data and digital strategy paper regarding a recommended review of all digital rail systems as a whole system)

A Stable National Vision Standardised and Specified Interfaces

Common Contractual Frameworks

Ticketing policy timeline

Despite RIA and the supply chain repeatedly requesting stability and vision, the period between the plan for rail’s announcement and the present day has been a constant stream of U-turns in policy position. Our timeline below paints a stark picture.

June 2021

New national rail flexible season tickets go on sale [48], claiming to save passengers hundreds of pounds but widely criticised by the media and campaign groups as failing to offer claimed savings. [49] .

May 2021

The Government announces the creation of a new public body, Great British Railways (GBR), with an aim to integrate the railways and deliver passenger-focused travel with simpler, modern fares and reliable services [5]. GBR will be accountable for the ticketing and retail offer across the country, with a single website and app to end the current confusing array of train company sites. The aim was to have GBR established and operational by 2024.

“New flexible rail season tickets will disappoint passengers and fail to bring them back to the railway, passenger groups and campaigners have said as the tickets went on sale in England on Monday. (…) Alice Ridley, of Campaign for Better Transport, said: “Many passengers are going to be disappointed. There’s a danger that people will change the way they commute and start driving, and we wanted flexible tickets to encourage people back onboard trains. We don’t think these tickets are going to do that or provide the savings that people had hoped for.” [49]

November 2021

An investment of £360 million is announced to radically reform and overhaul railway passengers’ experiences on fares, ticketing, and retail, including rolling out pay-as-you-go ticketing on commuter networks outside London [50] .

December 2021

Great British Railways Transition Team is established to take the first steps towards transforming the UK’s railways, and a call for evidence is launched [51] A dedicated Fares, Ticketing and Retail team looks at digital ticketing across the network; convenient and contactless experience in major urban centres; modernising the instation retailing experience; and simplified, best available value for money options on journeys outside urban areas.

“We will make the railways easier to use by simplifying fares and ticketing, providing more convenient ways to pay with contactless, smartphone and online, and protecting affordable walk-on fares and season tickets. Rail services will be better coordinated with each other and better integrated with other transport services such as trams, buses and bikes (…) Our reforms will also unleash huge new opportunities for the private sector to innovate in areas such as ticket retailing and data that can be used by passengers to better plan their journeys.” [5]

July 2023

The Rail Delivery Group announces proposals to close almost all train station ticket offices in England, replacing them with customer help terminals on platforms and concourses [52] .

Rail Minister Huw Merriman said: “One of the best ways to get more people using our railways is to make journeys as simple, flexible and convenient as possible and the government’s programme for rail reform prioritises exactly that. By removing the stress of finding the best deal in advance or having the right ticket ready to go at the barriers, the extension of tap-in tap-out ticketing is the next step of our plan for rail reform.” [53]

July 2023

£20 million of Government funding is allocated for the first phase of extending Pay As You Go to 53 stations in the South East [53] .

May 2023

London North Eastern Railway (LNER), in partnership with Government, introduces Single Leg Pricing across the network after a successful trial on three routes in 2020. Its innovation should be celebrated, but despite simplification of fares on a single route, this creates significantly different fare structures across different long-distance operators.

August 2023

The Department for Transport publishes “Mobility as a Service (MaaS) code of practice” for app developers [54]. It is claimed that ‘Passengers to benefit from easier and cheaper travel with new app guidance’, but whilst the guidance commendably champions ensuring that vulnerable groups and communities are not left out, it is unclear how it will directly lead to cheaper travel.

October 2023

ScotRail: The Scottish Government launch a trial where customers can travel at any time of the day on Off-Peak Tickets. The trial is scheduled to run until June 2024.

October 2023

Campaign for Better Transport publishes “A fare future for rail: a blueprint for fares and ticketing reform” report [11], including an extensive evidence base.

“The current fares structure is putting many passengers off travelling by train.”

“As the way we move around continues to change, the fares and ticketing system remains firmly rooted in previous travel and commuting patterns, despite changing demand for tickets.”

“Not only is the current fares system bloated and complicated, it is riddled with inconsistencies and has wildly different rules for different tickets and train operators” [11] Continues >

October 2023

Transport Secretary Mark Harper, responding to public outrage after a record 680,000 consultation responses are received [7], makes a U-turn by scrapping the proposals to close train station ticket offices [31]

“The Department for Transport (DfT) has announced that it is now not pursuing plans to deliver a centralised Great British Railways online rail ticket retailer. The proposals were originally outlined by the DfT in May 2021, as part of the Williams-Shapps Plan for UK Rail white paper. When asked about the change, the DfT pointed to the white paper which has been updated to say: “The private sector plays an important role in driving innovation and attracting more customers to the railway. As stated in the Bradshaw Address, we are focused on opening up railway data and systems, lowering barriers to entry for independent rail ticket retailers to improve passenger experience. We are confirming that we are not pursuing plans to deliver a centralised Great British Railways online rail ticket retailer.” [56]

December 2023

The Government makes U-turn and announces that it is scrapping the plans for GBR to operate a centralised online rail ticketing system [56]

November 2023

30 months after the announcement of the creation of GBR, rail reform is finally included in the King’s Speech [55] , meaning there is an intention to debate and pass the legislation during the coming parliament. However, the bill is the only one of 23 entered as draft, meaning it will likely be treated as lower priority.

January 2024

LNER announces Simpler Fares pilot scheme, pledging to make fares simpler and better value: through scrapping offpeak fares between London Kings Cross and Edinburgh Waverley and instead introducing ‘Flex tickets’. Older ticketing options are retained for all intermediate stations. The media miss the opportunity to celebrate an operator innovating in this space, instead reporting that tickets are more expensive under certain circumstances [57]

February 2024

The Rail and HS2 Minister announces PAYG pilots in West Midlands and Greater Manchester as part of the plans to rollout similar technology to more stations across the North and Midlands. This is a partial recommitment of November 2021 £360m announcement, meaning there has been a hiatus of 27 months.

January 2024

London Mayor Sadiq Khan announced that passengers using contactless and Oyster cards for travel on Fridays will be charged off-peak fares from 8 March until the end of May. This trial is aimed to help drive ridership and boost London’s wider economic recovery.

February 2024

The draft rail reform bill is placed before the Transport Select Committee for legislative scrutiny, including a public call for evidence. Ticketing reform is not explicitly mentioned. [58]

OUR ASKS

Based upon the policy gap analysis, RIA has developed the following four key asks. If fulfilled, they will help to overcome the gaps identified in our policy analysis, to enable revenue growth identified in Section 2.

KEY ASK 1

A Stable National Vision

There needs to be a stable national vision for the future of rail retail. Without it, it is impossible to implement long-term policy, strategy, and the leadership necessary to achieve it, in the years ahead.

● Recent ticketing policy has been a victim of regular U-turns, indecision, and hiatus (see page 12). Without a vision, there is no adequate way to set long-term policy or strategy.

● The vision needs stability, and to be free of political interference.

● Without long-term policy or strategy, it is almost impossible for the supply chain to invest, plan, or gear-up to deliver projects.

● Constant U-turns create significant financial burden, over and above that which would be incurred through stable, progressive, change. These costs are largely incurred by the supply chain, but eventually borne by HM Treasury and ultimately the taxpayer. They far outstrip any cost efficiencies which competitive, value-for-money, public procurement exercises are designed to ensure.

● Waiting for Great British Railways (GBR) is not an adequate strategy. The creation of GBR, and its ability to deliver Rail Reform, is not guaranteed in today’s highly political rail policy environment, with a General Election held by January 2025 at the latest. Realistically, the timescale for meaningful change could be years away.

● By contrast, regional transport bodies such as Sub National Transport Bodies (SNTBs) around the country, and TfL in particular, formed its vision for transport many years ago, and have used this vision to inform every decision made since. TfL is now widely regarded as world class.

● Note RIA is NOT advocating for central control, or a one-size-fits-all approach to rail retail, or a single retailer. The vision could just as equally be that each jurisdiction should be free to strategise as it sees fit for its own needs. Regardless of what type

of vision, a vision and direction of some sort is required, and this is lacking currently.

● Creation of the vision should be led by industry experts close to the customer needs, supported by legislation such as the enactment of GBR, and overseen by central Government, whose role should be limited to setting strategic objectives, guardrails, and legislative enablers.

It is not a coincidence that almost every single RIA document in recent years includes a plea for visibility of the Government’s strategic vision, the plans to deliver that vision and confidence that those plans will not change unexpectedly and without discussion.

The announcement of the ‘Plan for Rail’ in 2021 was greeted with optimism, marking what many hoped would be the beginning of a new era for UK transport, and more specifically its rail sector, characterised by long-term strategy and a roadmap towards modernisation. This plan was envisioned to address critical issues such as fare structures, the adoption of Pay As You Go (PAYG) systems, and the wider implementation of digital ticketing solutions.

However, the subsequent period has been fraught with delays, U-turns, and isolated pilot projects, leaving RIA members and the wider supply sector in a constant state of uncertainty. Rail suppliers are ready to engage and offer innovative solutions to the already identified aims of the plan – however, they find themselves navigating a landscape of indecision. The delay in the decision-making process regarding the establishment of GBR epitomises this stagnation; and despite assurances that ticketing reform and other initiatives could progress without legislative action,

The Scottish Government has, through legislation, established an expert panel for just this purpose: the National Smart Ticketing Advisory Board [59] in the Transport Scotland act (2019)

“The function of the Board is to advise the Scottish Ministers in relation to their functions insofar as they relate to smart ticketing arrangements, and the national technological standard for smart ticketing. The Board also has the function of issuing advice and recommendations to the Scottish Ministers in relation to the strategic development of smart ticketing in Scotland.”

An example of a vision: Innovate UK’s reimagining transport: UK Transport Vision 2050 [60]

“The second edition of Innovate UK’s Transport Vision 2050 has now been published. The updated document reflects a rapidly evolving sector which is having to decarbonise, respond to customer demands and adapt to changing lifestyles.

The document will help to inform our investments: between April 22 and March 2025 Innovate UK and our partners will invest £2 billion, shaping the future of transport and demonstrating the significance of this sector to the UK.

the reality has been a hiatus, hampering momentum towards modernisation.

The challenges faced underscore the critical need for a Government vision and strategy for UK rail ticketing, that transcends political cycles and is anchored in long-term planning. Such a vision requires strong, consistent, central Government leadership to drive a unified approach, ensuring that the railway industry’s future is not only envisioned but actively pursued. This entails securing sufficient funding and authority for regional transport authorities (SNTBs), thereby enabling impactful changes that balance the dynamism of the private sector with the oversight and direction of public governance.

The policy framework supporting this vision should be conducive to the adoption of off-the-shelf solutions tailored to the UK market, advocating for incremental implementation. By promoting an ‘ecosystem’ of multi-vendor solutions, the strategy would allow for smaller, more manageable projects that cumulatively drive substantial progress. Highlighting best practices and lessons learned through case studies can further guide this journey, offering valuable insights into successful implementation.

In conclusion for this ‘ask’, the time for piecemeal approaches and indecision is over. The UK railway industry’s future, particularly its fares and ticketing systems, clearly requires a coherent, unified strategy. This strategy should not only articulate a vision but also provide the framework and resources necessary for its realisation. Those leading the strategy need to be accountable. Engagement with the supply chain, clear communication of aims and benefits, and a collaborative approach with various stakeholders are essential components of this vision. Only through such concerted efforts can the UK railway industry achieve the modernisation and efficiency it desperately needs.

KEY TAKEAWAYS:

Our vision for 2050 is a transport system that enables the movement of people and goods from one location to another through safe, seamless, net zero, connected, cost effective, accessible and reliable means. The UK will increasingly meet transport and traveller needs with a transport system that embraces innovation…”

MEMBER QUOTES:

“People who plan for the future do not have any decision power, and people who have the power are not planning for the future.”

“The Department for Transport and the Treasury lack interest in long-term planning, understandably as their cycles are much shorter than the railways’. Having a big over-arching plan rather than firefighting could overcome this.”

“Achieving a seamless, nationwide travel experience requires planning, stakeholder buy-in, and a clear strategy and vision. The current landscape is fractured and there is a lack of leadership at a national level to drive changes. A more unified and integrated system requires long-term planning, similar to what London implemented, and the willingness to work towards it over a period of 10-20 years.”

“The potential of rail to bring transformative benefits to society is being suppressed by inaction from the Government.”

“We need better transparency and clarity in the project pipeline for transportation infrastructure and services. This involves providing a clear timeline and target dates for upcoming projects and initiatives. Having a visible pipeline will enable businesses and suppliers to plan ahead, and invest in the right technologies.”

“There is the need for a small convened group empowered to make decisions and resolve regulatory and legislative uncertainties to foster innovation and investment in the rail sector. Constant regulatory uncertainty is damaging when thinking about investing in new technology.”

KEY ASK 2

Standardised and Specified Interfaces

Interfaces between different ticketing ecosystems, across transport modes and constituencies, need to be standardised in a way which both allows interoperability and enables innovation.

● Standardised interfaces in ticketing allow a seamless experience that is vital for passenger experience.

● Establishing universal interface standards for secure and seamless ticketing across various transport modes will enable the adoption of Account Based Ticketing (ABT). ITSO Specifications are one way, but not the only, way to achieve this.

● A ‘Universal Transport Token for Contactless PAYG System’ can ensure cardholder data protection across different operators to facilitate easy and secure payments.

● Engaging with the DfT, Subnational Transport Bodies, other operators, but most of all private sector suppliers who are experts in this field, would ensure standardised ticketing solution interfaces were suitable.

● The potential for disjointed PAYG systems, which could hinder a unified travel experience, needs to be addressed.

● Aligning with broader standards, such as the European wide standard Advanced Passenger Information (API), may help to sell train tickets with enhanced cross-border travel efficiency.

● Providing the freedom for the private sector to innovate has demonstrably delivered customer benefits and cost efficiencies. This must be carefully balanced with the need to ensure competing and/or complementary systems are interoperable, between regions and modes.

The UK’s transport sector’s journey towards a ticketing ecosystem which is seamless for passengers necessitates a shift towards greater interoperability, not just within railway ticketing but across the revenue model for the entire transport network.

The fragmented nature of the current system, with multiple players each following proprietary standards, poses a significant challenge to the implementation of multi-operator and multi-modal ticketing solutions. This fragmentation leads to a complex landscape, where the aspiration for a seamless passenger

experience is hampered by the lack of a coherent operational framework.

Fragmentation can, however, be beneficial as it allows innovation and new market propositions tobe tailored closer to customer needs. For example, barcode ticketing was iteratively developed and piloted by a coalition of retailers and Train Operating Companies (TOCs). It evolved to incorporate learnings from pilot projects and, once it reached maturity, was incorporated as a standard for all. It has achieved over 50% customer adoption. ITSO, in contrast, was designed by committee, distant from its end users, slow to evolve, and has only achieved 5% adoption.

GBR’s promise to extend contactless PAYG within urban centres in the UK is a step in the right direction, yet it is imperative these systems are designed to work together from the outset, and to offer passengers best value regardless of provider (see ‘Ask 3’ below). Without this foresight, there is a risk of a more fragmented network that complicates rather than simplifies travel for passengers.

To overcome these obstacles, a collaborative approach is essential. This involves not only aligning with European standards, such as those outlined in the Community of European Railway and Infrastructure Companies (CER) Ticketing Roadmap [61], but also working closely with devolved Subnational Transport Bodies and other operators to align ticketing

Application Programming Interfaces (APIs). The goal is to promote the development and adoption of fully compatible transport ticketing ecosystems, enabling passengers to seamlessly transition between different transport modes through one single, user-friendly, platform.

Transport for The North’s call for a Universal Transport Token underscores the need for a standardised approach to secure customer data, ensuring that passengers can use contactless payment methods without the need to worry about the security of their information [62]. This is crucial as PAYG systems become

MEMBER QUOTES:

more prevalent and need to interoperate without friction.

Standardisation extends beyond technology to include the labelling of ticket types and terms, ensuring clarity and ease of understanding for passengers. Furthermore, investment in the development and implementation of Account Based Ticketing (ABT) infrastructure across the railway network is paramount. This would allow for the use of various payment methods, including bank cards and mobile devices, offering a seamless and contactless travel experience that eliminates the need for separate smart card schemes.

Mobile has had virtually no Government investment yet now accounts for over 50% of rail revenue, with consistently high customer satisfaction scores. Compare that to the billions spent by Government on ITSO cards with their < 5% take-up. In many ways this is a classic case study of empowering the supply chain, giving freedom to innovate, then adopting the result into standards. This is not unique to rail – looking at local transit, local ticketing schemes such as West Yorkshire’s MCard, have seen customers swing to 80:20 mobile:ITSO once given the choice.”

“Standard interfaces won’t save the day, but life is very difficult without some sort of interoperability. But we have to be careful: standards shouldn’t be so rigid they stifle innovation, and they should be created by the whole industry, not dictated centrally.”

“We need access to data and systems; we need to allow the freedom to innovate and experiment; we need the ability to spot winning innovations and scale them, and then only at that point incorporate them into standards for all.”

“There is a need for a nationally consistent approach to transit policy to avoid fragmentation and a lack of interoperability.”

“A lot of the technology to create a fully integrated transport system is already existing. If we join up the stakeholders, we can provide seamless, personalised services for passengers, like targeted personalised delay repay, and make a massive difference in their experience.”

“We have multiple players within the UK ticketing industry with different standards or with different ways of doing things, which means that multioperator and multi-modal ticketing is far harder to implement in the UK than it is in other territories.”

“It would be really good for the industry to develop, or for transport to develop, interoperable standards for transit. The supply chain, including back-office suppliers and reader suppliers, would be able to develop their systems to adhere to that, which means interoperability would be baked in.”

“The lack of a clear national strategy for ticketing is leading to each region or local authority developing its own ticketing systems, which may not be interoperable with each other. We need to ensure compatibility and ease of communication between different systems. Fudging many non-interoperable systems together after deployment is never as good as defining the interfaces at the start. Standardised ticket vending machines, have been a success, but there are currently no standards for gates and validators in the same way.”

“Transport authorities to invest in the development and implementation of a standardised Account Based Ticketing infrastructure across the rail network. This will eliminate the need for separate smart card schemes and validators.”

KEY ASK 3

A Level Playing Field

There needs to be a level playing field for all, including access to all core data, fares, and features, to achieve the vision of an environment supportive of rail retailers and one which encourages competition and accelerated innovation for the customer’s benefit.

● The rail industry needs to embrace or learn from the Open Sales and Distribution Model (OSDM) [63] to facilitate fare distribution and retailing efficiently. This model could serve as a blueprint for a unified, nationwide transit policy that ensures consistency and interoperability with other modes.

● There needs to be a culture of data-sharing that benefits all stakeholders, enabling innovation and improving customer experiences.

● Regulatory measures need to be introduced that guarantees the openness and transparency of data streams, ensuring all parties have unfettered access to necessary information to innovate and serve customers effectively.

● There needs to be recognition that a ‘level playing field’ is broader than just rail: others in the supply chain benefit from open access to data too, for example Mobility as a Service (MaaS) providers.

The Government’s decision not to pursue a centralised ticketing system has arguably led to an absence of clear vision. The outcome is a continued open market with multiple rail retailers, though it has not been explicitly stated this is the vision. It may add complexity but is widely regarded as being positive for innovation and ultimately the customer. However, an open market needs to be fair to all in order to deliver for that customer. The UK therefore needs to adopt a strategic approach to rail ticketing that embraces collaboration and data sharing.

Currently multiple Mobility Service Providers (MSPs) operate under their proprietary APIs and ticketing systems. This fragmentation is underpinned by multiple customer data repositories. State actors in particular have demonstrated a reluctance to relinquish direct customer relationships and the valuable data these entail, despite a historical underutilisation of such data by transport businesses.

The crux of the challenge lies in the tension between the desire to maintain control over customer data and the need for a more collaborative approach to data sharing and interoperability. This tension is exacerbated by the thin margins made on ticketing, which discourage MSPs from engaging in practices that might dilute their revenue streams, such as participating in a more open, integrated ticketing ecosystem. The potential benefits of a unified customer data platform, capable of delivering tailored offers and recognising customer loyalty, remain largely untapped due to these systemic barriers.

An example of a lack of equality negatively impacting passengers is the Mayor of London’s recent announcement that Fridays will be charged as off-peak to encourage people back into the capital this day. This fare is only available through contactless and oyster. Anyone who books a ticket through any other means or provider – e.g. digital, does not get the saving, and is not told about the price difference. The independent retailer cannot compete fairly and the customer is worse off as a result.

Another example is provided in the section ‘Overpay as you go’.

However, comparing the UK’s fragmented market with international counterparts underscores the differences. In the EU, for example, there is interoperability and standardisation with centralised control, but this brings inflexibility, a lack of innovation, and a closedshop to third parties. This in turn leads to difficulty in bringing new propositions to market. The necessity

for Government to intervene to establish and enforce standards across the transport ecosystem is starkly evident, but those standards must be carefully crafted. Aligning with initiatives like the OSDM provides a foundation for this, offering a proven framework that can be adapted to meet the UK’s unique needs while ensuring compatibility and interoperability with European standards.

A collaborative effort between the Rail Delivery Group (RDG), transport operators, retailers, and other stakeholders is essential to develop a nationwide approach that leverages open data and shared standards. This approach could include a two-tier

MEMBER QUOTES:

data access system allowing startups to plug into an industry system while providing larger retailers with granular data access to drive innovation and improve customer experience.

Central Government vision and a willingness to embrace innovative digital solutions are crucial to overcoming the current fragmentation and building a ticketing system that is fit for the future. This requires not just technological innovation but also a cultural shift towards greater openness, collaboration, and a shared vision for the transformation of the UK’s transport infrastructure.

We cannot ignore big tech and the payments industry. Whether it is Google journey planning that is now mainstream, or innovations such as “Transit Enhanced Open Loop” payments (in trial in UK bus). Rail does not exist in isolation, and nor does transit. Rail cannot craft a fares and ticketing strategy exclusively in its own biosphere. Increasingly, standards are led by the global tech players, and payments industry, as much as the national transport committees.”

“Large, centralised Government schemes, such as pay-as-you-go, have proven less successful than smaller, privately funded schemes, such as the rollout of mobile ticketing.”

“LNER has a digital strategy, constantly adapting to market feedback and customer needs with its own local digital ecosystem, and is outperforming the market. Avanti has a clone of the Italian state railway system and is significantly underperforming.”

“Historically, railway owning groups preferred to have their own retail platforms, driving a competition against other retail companies. These platforms were seen as an opportunity to build customer relationships and direct marketing efforts. They can do this as the have the data. But really, the data should belong to the customer to share as they see fit, not any one retailer.”

“We need changes in legislation that grant individuals ownership of their transportation data. Data collected from passengers’ travel patterns and behaviours is owned by the individuals themselves, rather than being held exclusively by transportation operators or organisations. Enabling individuals to control their data and decide how it is used can lead to better data-driven services, personalised travel experiences, and improved planning.”

“The centralised control model of EU national operators is not a panacea either – inflexible centrally controlled systems, no culture of innovation, and a closed shop to third parties – often culminating in a lack of innovation and difficulty bringing new propositions to market.”

“Essentially, the sharing of data is fundamental to information being served up to the customer, and it is that information that informs their decision. If data is held back from certain retailers – timetables, reservations, whatever it may be – then a customer using that platform may not get the best deal. That’s not fair on the customer or the platform.”

“If those in control of the data keep elements to themselves then it becomes hard for innovative entrants to compete. A great example is urban transportation authorities’ willingness to provide data to Citymapper, as an independent. Can you imagine if, say, TfL had said to Citymapper, yes you can have all of the data, but not the bus timetables, we’re keeping those so people have to come to our website still. It would completely undermine what Citymapper does. But that’s essentially what the current rail retail setup does to independent retailers.”

KEY ASK 4

Common Contractual Frameworks

Multimodal Common Contractual Frameworks need to be established, but not mandated. These would provide a clear structure within which Mobility Service Providers could operate, fostering an environment conducive to new entrants, intermodality, innovation and collaboration.

● The current landscape, characterised by fragmented ticketing systems and lack of interoperability, significantly detracts from the passenger experience, and hampers the industry’s ability to engage with innovative ticketing solutions.

● Uniform models need to be implemented for revenue distribution and passenger compensation across transport services.

● Frameworks need to be established which enable secure and efficient exchange of operational data between transport operators.

● Direct Government involvement and stakeholder engagement in developing and implementing Common Contractual Frameworks (CCFs) should be encouraged.

● Incentives within Passenger Service Contracts to encourage innovation and service improvement by transport operators should be introduced.

● Pilot projects under the new frameworks to test and refine these approaches in real-world settings should be introduced.

● Operators and ticketing providers could be free to operate outside the frameworks should there be a business or customer advantage to doing so.

The UK’s vision for a seamless, efficient, and user-friendly public transport system is currently compromised by the piecemeal nature of its ticketing and MaaS systems. The lack of interoperability between these systems results in a disjointed and often frustrating travel experience for passengers. Moreover, the absence of unified protocols for aspects such as revenue collection, compensation during travel disruptions, and data-sharing among different

transport operators poses significant barriers to the realisation of a truly integrated transport network. The UK is unique in having established a ‘reseller’ model for rail retail [64], with published rates [65], but these apply only to rail, leaving a gap for cross-modal applications.

In response to these challenges, RIA calls for the support and implementation of CCFs specifically tailored to the UK’s public transport system. These frameworks should incorporate standardised revenue collection methods to ensure equitable and transparent financial arrangements across all transport modes, thereby simplifying payment processes for passengers. Additionally, passenger compensation mechanisms must be established to provide clear and consistent responses to travel disruptions, enhancing trust and satisfaction.

Crucially, as highlighted in the ‘Ask 3’ above, comprehensive data-sharing agreements are needed to facilitate the secure and effective exchange of information between transport operators. This will not only improve service planning and network optimisation but also enable the delivery of personalised passenger services based on data-driven insights.

Enhanced interoperability facilitated by standardisation will lead to a more cohesive ticketing and mobility ecosystem, improving the overall passenger experience. The collaborative environment fostered by a common framework will stimulate innovation, encouraging stakeholders to develop and implement new solutions that address the evolving needs of passengers. Moreover, facilitated data sharing underpins informed decision-making, allowing for targeted improvements to the transport network.

To achieve these outcomes, RIA calls for decisive Government leadership to drive the development of a national suite of CCFs. This initiative should involve active participation from all relevant stakeholders, ensuring the framework is comprehensive, inclusive, and reflective of the diverse needs within the UK’s transport ecosystem. Pilot projects implemented under the auspices of the CCF will provide valuable opportunities to test, refine, and validate the framework’s effectiveness. However, there should always be freedom for individual organisations to operate outside the frameworks should there be a commercial or customer advantage.

The establishment of CCFs represents a critical step forward in achieving an integrated, efficient, and passenger-focused public transport system in the UK. RIA is committed to collaborating with policymakers, industry partners, and stakeholders to advocate for and facilitate the development of these frameworks, thereby advancing the vision of a unified and innovative transport network.

MEMBER QUOTES:

“Multiple players and many different standards underscores the complexity of aligning contractual agreements and responsibilities across diverse entities, pointing towards the necessity for common contractual frameworks to ensure interoperability and seamless passenger experiences.”

“We need to explore a model where a central authority could facilitate contractual agreements and technology licensing, indicating a structured approach to regulation, liability sharing, and responsibilities among transportation stakeholders.”

“The broader discussion around innovation and the future of rail retail suggests that contractual arrangements should be flexible enough to accommodate new technologies and business models. Contracts should be designed to encourage innovation while ensuring that all parties are protected and obligations are clearly defined.”

“Integration needs to extend to, for example, if your bus to the station gets held up and you miss your booked train, you are not penalised, instead, how about the ticket provider apologises and compensates. The commercials between modes for revenue and risk split are a real challenge and it would likely need some sort of independent body or contractual framework.”

“The emphasis on interoperability and the need for a cohesive data sharing and processing standard indirectly touches upon the importance of clearly defined liability and compliance measures within contractual frameworks.”

“As systems become more interconnected, determining responsibility for data breaches, system failures, and other issues become more complex, necessitating clear contractual guidelines.”

Appendix: Where did our journey originate?

A brief history of UK railway ticketing

Tickets are a rather abstract concept. A paper receipt for payment of a given amount, bestowing permission to be in a certain place. Not legal tender, but holding a value, until expiry. In the 1800s, cash was the only method of payment for goods and services of low value. The nascent railways were typically owned by other companies – mines or foundries – to transport their bulk products, so no proof of payment was necessary until the goods were later sold or transferred. Beginning around the time of the Rainhill trials in 1829, railway companies began to take more notice of transporting passengers for profit. Little information exists about ticketing these early days, but it is likely that working practices were adopted from the nearest equivalent service in common use: stagecoaches [66] .

The first recorded use of a railway ticket was in 1840, issued by the Stockton and Darlington Railway. These early tickets were typically simple paper documents that allowed passengers to travel on a specific train or route. They were stamped with the company logo and class of travel, but otherwise, largely hand-written. In the days before communications could be used to remotely validate the payment had occurred (the telegraph was not widely adopted until the latter half of the 1800s, and the telephone not invented until

1876), a sheet stamped with a company crest served as both a proof-of-payment receipt and the resultant permission to travel.

The early years of ticketing were marked by a lack of standardisation. Each of the many railway companies had its own ticketing system, with different prices, rules, and ticket types. Disparate information provision made it difficult for passengers to plan journeys and compare prices. To address these issues, the RCH (Railway Clearing House) was established by the government in 1842, standardising ticketing and accounting procedures across all railway companies. This allowed passengers to purchase tickets valid for multiple companies’ trains and made it possible to calculate each company’s share of the revenue. The RCH went on to become the major regulatory body overseeing the day-to-day running of railways in Great Britain: setting common standards for railway companies, and ensuring safety and interoperability. The introduction of the timetable in the 1850s further simplified journey planning. The RCH also produced fare structures governing many aspects of railway transport at a national level and set limits on price increases for passenger travel until it was gradually dissolved in the 1950s [67]. Until the 1960s, railway fares were regulated on a purely distance-based pricing

Origins of the words ‘Ticket’ and ‘Commuter’

Ticket

The etymology of the word ‘ticket’ is from the French etiquet/ etiquette, meaning ‘label or note’, first appearing in the 1500s and itself from the older estiquette meaning ‘a little note’ (late 1300s): literally ‘something stuck up/on’.

The earlier German ‘stikken’ (to be stuck), ‘stikkon’ (pierce or prick), and Stecken (literally a wooden stick) all relate, in that public notices would be pierced and affixed using small sharp wooden rods.

It is surmised that the development of etiquette in the French language is from small cards with instructions for how to behave properly at court or issued

to soldiers at lodgings to describe suitable behaviour.

The modern meaning of ‘a card or piece of paper that gives its holder a right or privilege’ is first recorded in the 1670s, and the first use of ‘railway ticket’ is recorded in the 1840s. In railway terms, that holder is a passenger, and the privilege is that to travel on a given service.

Commuters

The word commuter, its meaning being ‘one who goes back and forth to work’ first appeared in American English just a few decades later in the 1860s. Commuter is an abbreviation of commutation, itself shorthand for ‘holder of a commutation ticket ’.

A commutation ticket (first recorded use in 1848) was a railway ticket issued at a reduced rate and entitling the holder to travel over a given route over a certain period. The word commutation means ‘to combine several payments into a single one, pay a single sum instead of a number of successive payments’ (first recorded use 1845). Today, in British English, such a purchase is referred to as a season ticket. Despite its railway origins, the word commuter is now ubiquitous in our lexicon for people who travel a distance to work: by any transport means, with or without a ticket.

model [68]. The revenue distribution function of the RCH is now provided by the DfT (Department for Transport), but without distance-based pricing, the division of revenue between operators is much more complex.

One of the first acts of the RCH was to standardise the physical form of the ticket, and the Edmonson Ticket was selected, named for its inventor, Thomas Edmonson [69]. This was a pre-printed ticket, removing the need for the ticket clerk to hand-write out each purchase, speeding up the sales process. However, the major innovation was the inclusion of a serial number. This helped to combat fraud on two fronts. It reduced the ability of fare-dodgers to use fake tickets, and it forced the ticket clerk to correctly reconcile sales, helping to prevent them stealing the fare revenue.

Rather than buying in the tickets, the railway undertakings printed their own. British Rail’s printing centre at Crewe met its annual demand for 320

million tickets [70]. The Edmonson ticket was finally discontinued in 1990, meaning they were in use on British railways for nearly 150 years. Their use continues overseas to this day in a number of jurisdictions: a very successful export.

The 1920s and 30s saw the introduction of season tickets and railcards, both making railways more cost effective for regular users. Railcards offered discounts to specific groups of passengers, such as students, the elderly, and families. In some London termini, season ticket holders now make up half of daily travellers [71]. In 1948, nationalisation placed a greater emphasis on subsidies to provide a public service, rather than outright private profit. The rise of the car and the expansion of motorways led to a temporary decline in ridership. In dense urban areas railway still provided the fastest form of transport. This period saw the introduction of the Travelcard in London, offering unlimited travel amongst specific zones for a given

time – proving very popular right from its inception.

The era of ‘managed decline’ in the 1980s saw some of the largest changes to ticketing implemented in the lead-up to privatisation in the 1990s. Further ticket types, such as advance and super off-peak tickets, which offer discounted fares for passengers who booked their journeys in advance or on quieter services, were introduced, as was a fully computerised ticketing and reservation system [4] featuring several world firsts: APTIS. (Accountancy and Passenger Ticket Issuing System). APTIS automated and streamlined a large part of the national rail retail and enforcement back-end [72]

Ticketing Firsts

Oldest Recorded Ticket:

The Stockton and Darlington Railway issued the first recorded tickets for travel by train in 1840. These early tickets were simple paper slips which were hand-written by the ticketing clerk, in a practice adopted from the stagecoach industry.

Magnetic Ticketing:

The physical change associated with this digitisation was the ubiquitous orange-edged, credit card sized ticket. The introduction by BR and LUL of the magnetic stripe ticket, with computer-readable data stored in a magnetised area of the card was revolutionary in the 1980s: low in cost, practical, accessible, and easy for all to understand. In original specification, the cards were not all orange: there were green, blue, grey, and even gold variations which offered railway staff swift identification of regular travellers and big spenders: the foundations of a loyalty scheme. APTIS was retired in favour of modern PC-based systems in 2007. However, MagStripe was so good that it was retained, and was still used on over half of all rail journeys right up until 2019 [73], well into the e-ticketing era. Sadly, there were significant negative results of computerisation for our passengers too, which are covered in ‘Where are we now’ section.

The negatives of digitisation upon ticketing were not, however, reflected on TfL. In the capital, Oyster contactless was introduced in 2003, following a similar system’s successful integration with Hong Kong’s MTR in 1997. Through a simple and clear fare structure, daily and weekly caps, tight integration with other transport modes, and an online portal where journeys could be reviewed and any discrepancies challenged, Oyster captured the absolute trust of the travelling public. Within a decade, over 80% of annual journeys in the capital were made using the card [32]. This demonstrates the general public’s appetite for simplicity and convenience, and underlining the railway industry’s ability to deliver a complex, multistakeholder technology project in a very challenging environment, to great benefit.

In 2014 the Oyster system was extended to include contactless credit/debit card payments as part of TfL’s ‘Future Ticketing Programme’ [74], following an earlier rollout on a much smaller, simpler network in France in 2010 [75]. By 2016, TfL was one of Europe’s largest contactless merchants, accounting for 10% of contactless transactions in the UK [76], and TfL planned to use its expertise to underpin New York’s subway

Magnetic stripe technology was in use in railways many years before its transfer to credit and debit cards. The technology was developed through the 1960s and allowed for more efficient automated ticket processing. When the idea of plastic money came along, the magnetic stripe was then used to hold the data.

Contactless Tickets:

Banks were first to deploy contactless with the National Westminster Bank’s Mondex card in the mid-90s. Shortly afterwards in 1997, Hong Kong’s MTR Octopus card became the world’s first contactless ticket card, and the first widelyadopted contactless smart card system, followed shortly by TfL’s Oyster.

Crosswords:

Arthur Wynne, the inventor of the crossword puzzle, worked for the New York World newspaper. Urban legend is that he came up the idea for the crossword puzzle while looking at the layout of railway tickets, with their square grid pattern.

rollout [77]. The significance cannot be understated: the travelling public trusted TfL and post-spend review so much that they were willing to blindly give the operator access to their entire bank balance or credit limit several times per day [78]. The contrast with mainline ticketing is stark.

The mainline railway has now entered the era of e-ticketing. E-tickets – a ticket for which confirmation is granted electronically in place of a printed ticket –have been the dominant form of ticketing since 2019. However, the implementation of e-tickets has been patchy, gradual, and very much centred around a changing technology at a single touch point, rather than enhancing the end-to-end experience. In fact, complication has grown, with the number of available tickets, discounts, rules, and dispensations meaning there are now 55 million different fares available [11]

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