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Tuesday, 2 January 2018

Rail union claims 3.4% UK rail fare increases will fund train operating company profits by £390 .5 million and not investment in rail....

Rail union claims 3.4% UK rail fare increases will fund train operating company profits by £390 .5 million and not investment in rail....

 

 

 

A rail Union is claiming that all new cash generated from today’s 3.4% fare increase will fund train company profit instead of rail investment...

 
As rail fares protests organised by the RMT Union take place at forty stations around the country today, a new study commissioned by the union claims that 'every penny of this year’s inflation busting fare increase is going straight into the ‘profit’ of the privatised train operating companies'.

The RMT further claims the figures demonstrate that rail bosses are 'trying to hoodwink passengers with completely bogus arguments' that the fare increases are to fund investment in rail. 

The Union points to figures derived from using the rail operators own claim that “only” between 3 and 4 pence in every pound of passenger revenue goes toward their profits and analysing what impact this would have on total passenger revenue.

RMT General Secretary Mick Cash said: “To hide their greed rail bosses are trying to hoodwink passengers with completely bogus claims that this year’s rail fare increases fund investment when these figures show that in fact all the fare increases will fund profits.

“Passengers are actually paying more and more for less and less. More fare increases and more profit for less train guards and staff and less reliable services.

“Our members will be protesting to today to say it is time to cut our fares not our staff and for a publicly owned railway where every penny of passenger revenue goes to improving services.”

The latest  revenue figures available for 2016-17
https://dataportal.orr.gov.uk/displayreport/html/html/52a56c52-6d3f-49ce-8b92-dbb7b9cbad2c show the total franchised passenger revenue at current prices (calculated using the implied GDP deflators published by ONS on 24th August 2017) at £9.441 billion.  Applied to the yearly passenger revenue of £9.441 billion the 3.4% increase in fares will increase passenger revenue by £320, 994, 000.

Claims about the amount of profit made by the train operating companies vary (see below). The Union states that some rail operators say it is 4p (i.e. 4%) which computes as a profit of £390,479,760 when applied to passenger revenue.

Others such as the rail senior management association known as the Rail Delivery Group say profit is “only” 3p in a pound (3%) which still results in a profit of £292,859,820 when applied to passenger revenue. 

Somewhere between 3 and 4%, at say an average of 3.5%, gives a figure of £341,669,790 profit from fare revenue meaning all of the increase in passenger revenue  arising from this year’s fare increase will be swallowed up in surpus ie profit.


Stagecoach, which operates a number of rail franchises  claim on its website “Over many years, the average operating margin of train operators in the UK – that is profit as a percentage of the revenue it collects – has remained fairly constant at around 3p to 4p in every £1 of the cost of a rail ticket”.
http://www.stagecoach.com/media/insight-features/the-facts-about-rail-fares.aspx

Rail Delivery Group claims about 3% profit are here 
https://www.raildeliverygroup.com/our-services/links-for-passengers/about-my-rail-fare.html

RMT supplied list of station protests below:

Station
Bridgewater 07.00 - 0900 and Weston Super-Mare 07.00-09.00
Berwick upon Tweed 10.00-1200
Birmingham New Street 07:00-09:00 and 16:30-18:00
Birmingham Snow Hill 16:00-18:00
Bournemouth 8.00-10.00
Brighton 07.30-14.30
Bristol Temple Meads 07.00-09.00
Cardiff Central 07.00-09.00
Carlisle Citadel  06.15 - 0900
Chelmsford  (tbc)
Chester 07.00 - 09.00
Colchester North 06:30-09:30
Euston station 09.00-10.30
Hove 7.30-14.30
Ipswich 07:00-11:00
Kings Cross 08.00-09.30
Lancaster 16:00-18:00
Leeds City 06:00-10:00
Lewisham 07:30-09:360
Lime Street 07.30-09.30
Manchester Piccadilly 07.30-09.30
Moorfields 7.30-09.30
Newcastle Central 07.30-09.00
Nottingham 07.00-9.30
Nuneaton  0700-0900
Paddington 07.00-09.00
Plymouth 07.00 - 09.00
Portslade 07.30-14.30
Portsmouth Southsea 16.30-18.30
Reading 07.00-09.00
St Leonards Warrior Square 17.30-19.30
Stockport Station 07.30-09.00
Ulverston Station 06.30 -0930
Walsall 07:00-09:00 & 16:30-18:00
Warrington Central 07:00-09:00 & Warrington Bank Quay 16:00-18:00
Waterloo  08-10.00
Watford Junction 07.00-09.00
York 07:30-09:00 & 16:00-18:00

SCOTLAND (3rd January )
Edinburgh 16.00-18.00
Glasgow  tbc
Dunbar  08.00- 10.00
North Berwick 08.00- 10.00
Inverkeithing tbc
Dunfermline tbc
Kirkcaldy 630 -830

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