Rail Fares: Cheltenham and London

Alex Chalk Excerpts

Wednesday 19th December 2018 Commons Chamber

[Alex Chalk (Cheltenham) (Con)]

It is a pleasure to see you in the Chair, Madam Deputy Speaker.

I have called this debate on rail fares between Cheltenham and London because when it comes to rail travel, my constituents are not being treated fairly. Local people, simply because they live where I and my constituents do, are being charged more per mile for their train travel to London than others who live a similar distance from the capital. It is an injustice that stretches back decades and it needs to be put right.

Cheltenham is around 90 miles or so from London. Because Dr Beeching, in his wisdom, pulled up the more direct line through Andoversford, the train line itself is a little lengthier because it travels a more circuitous route, but the central point remains: it is not terribly far from London at all. It is a substantial town, with more than 110,000 people. It is larger than Basingstoke, Chelmsford, Maidstone and Worcester. It is the home of GCHQ and GE Aviation—certainly if we include Bishops Cleeve. It is the home of Spirax-Sarco and Superdry. It hosts the world famous Cheltenham jump racing festival, the renowned literature, jazz, and science festivals, and much more besides. When it comes to train use, Cheltenham is by far the busiest station in Gloucestershire. Data from the Office of Rail Regulation shows that 2.35 million passengers used the station in 2016-17—almost as many as all the other stations on the route combined, and twice as many as 10 years ago.

Despite all that, there is a glaring discrepancy when it comes to the price of tickets, and season tickets in particular. Take, for example, Kingham to London, which is admittedly a shorter distance, but not much shorter. The season ticket price is £7,124. What about Bath Spa to London, which is further than Cheltenham to London? The season ticket price is £8,064. A season ticket for Bristol Temple Meads to London is £8,244, and a season ticket for Worcester to London is £8,400, yet a season ticket for Cheltenham to London Paddington is £10,344. To make the point absolutely clear: were someone to go way further than Cheltenham, down to Exeter, which is a similarly sized town, the distance from London is 202 miles, which is approximately double the distance to Cheltenham. The season ticket for Exeter to London is £9,788. In other words, it is around £500 cheaper than the Cheltenham season ticket. How can that possibly be fair?

What rubs salt into the wounds is that the service is not as good as it should be. First, there is a systemic problem: it is too slow overall. I see the hon. Member for Stroud (Dr Drew) nodding his head in agreement. Let me put that into some kind of perspective: the journey from Bristol to London takes around an hour and 43 minutes, and from Exeter, which as I said is around double the distance, it takes two hours and two minutes to get to London, yet the shortest journey from Cheltenham takes longer still than that. On average, it takes two hours and 16 minutes.

The first problem, then, is that it is too slow, which is galling because there was a time when Cheltenham had the fastest train service anywhere in the country—the Cheltenham Flyer was the fastest train in the land. The second problem is that there are too many delays and cancellations. On Saturday 4 August, five services were cancelled because a train manager was not available.

What is the impact of all this? Put bluntly, the impact in my constituency is modal shift, which is a technical way of saying that people get in their cars. So many of my constituents drive to Kemble, Kingham, Swindon, Oxford, or even all the way to London. My constituents express frustration at the fact that they are forced to do so and at the fact that that has an unhelpful impact on the environment and air quality. Other concerns are expressed about businesses being restricted from developing and expanding in the way that they otherwise might have done. I posted on social media about this issue, and businesses in Eagle Tower in the centre of Cheltenham said that they are unable to recruit in the way that they might otherwise do or to expand their businesses.

This issue is also important because Cheltenham has plans for a cyber-park, which I have been passionate about since 2014 and which has made really crucial steps forward in recent months. The Department for Transport has committed £22 million in transport infrastructure improvements. The Department for International Trade is promoting the park at international conferences and so on. The park will succeed, but its ability to do so will be immeasurably enhanced if we can have an affordable and good rail connection with London.

[Dr David Drew (Stroud) (Lab/Co-op)]

I thank the hon. Gentleman for giving way. Considering that we are talking about the Stroud Valleys line, which goes to Cheltenham, I have a vested interest in this matter. On fares, when I had to travel to Gloucester last week, I found to my shock that it cost an extra £10 either way. That may well be what happens from where I live in Stonehouse, and yet that is exactly the same cost of just getting a train from Stonehouse to London. In other words, the company is charging a person the same when they are on the train as they would do if they were getting on the train for the shorter journey. That cannot be right or fair. Effectively, it is charging the punter more than it should. Does he agree?

[Alex Chalk]

I do agree, yes. There are two aspects to the pricing perversity that that helpful intervention discloses. First, the line itself is more expensive than similar lines. Secondly, there can be perversities within the line itself, which is an inequity for local people. In the interests of balance, it is important to note that there are some really important and good things taking place. Nationally, I commend the fact that the Government are continuing with an ambitious programme of investment. That is £48 billion over the next five years. The DFT is in the process of moving from Delay Repay 30 to Delay Repay 15, which is more justice for consumers. In Gloucestershire, the redoubling of the Kemble to Swindon line is a hugely positive infrastructure improvement. There are impending timetable changes and new faster trains, so we will be getting a direct hourly sub-two hour service to London in 2019. That is all great. It is also great that Cheltenham is getting an additional 70 surface car parking spaces, taking capacity to at least 320 spaces. That is investment worth £700,000 going into Cheltenham, so that is also good news, and there is further investment to come. I am not standing here and saying that, somehow, we should turn the clock back. I do not believe in renationalisation. I am just about old enough to remember British Rail, and it was absolutely terrible. The fact is that, since privatisation, a huge amount of money has been invested in our railways and passenger numbers have soared.

It is not enough to say that renationalisation would be a terrible backward step. It is not enough to say that it would cost the taxpayer, not save them money. It is true that it would reduce investment, not increase it, and innovation would be stifled, not encouraged and so on. However, simply rejecting renationalisation is not enough. The market needs to be forced to act fairly. Private companies have a responsibility to the public, and a particular responsibility where the public is a captive market, and cannot take their custom elsewhere, as is the case on the railways. The provider must operate within a framework that ensures that that monopoly position is not abused and customers are treated fairly. It is fair to say that, in these circumstances, it is not acting as it should. In a debate on 15 October—so, not very long ago—the then rail Minister referred to “historical anomalies”. He also stated:

“No one could defend the current fares system”.—[Official Report, 15 October 2018; Vol. 647, c. 476.]

He was absolutely right, and I really welcomed that frank admission. One issue is that monopoly power on certain lines distorts pricing. For example, if we look at Grantham, which is also around 100 miles from London, we see that there are three franchises competing to provide a service. A season ticket from Grantham is around £3,000 a year less. Equally, if we look at Crewe, where there are two operators, it is only £500 a year more, despite being 170 miles from London, so a considerable distance further. The issue of whether there is a single operator or more providers can make a big difference as well.

This issue must be fixed. I am aware that the Government have commissioned the Rail Delivery Group’s “Easier Fares” consultation, and are considering that. I am also aware that, on 11 October, the Secretary of State launched a “root and branch review of the rail industry”. In his words, he said:

“It is vital that this review leaves no stone unturned and makes bold recommendations for the future.”

I warmly welcome that, but one of those stones needs to be marked “Cheltenham”. We are not asking for special treatment, but we are asking for fair treatment. For the sake of my constituents and the future of the town I represent, that cannot come soon enough.

[The Parliamentary Under-Secretary of State for Transport (Andrew Jones)]

I congratulate my hon. Friend on securing this debate. He is a great champion for Cheltenham, and all things in and around it, as we have just heard. He is most certainly a great campaigner on rail issues for Cheltenham, as I have found very early in my time in this role, and as my predecessors are all too aware.

My hon. Friend made reference to the fact that passenger numbers in Cheltenham have grown recently. Indeed, in the last 20 years and a bit more, passenger numbers have doubled on our rail network; it is a fantastic thing. The Government and franchise train operators have made significant investment in services and the network to cope with the challenge of this significant increase in use. It is also fair to say that there are many issues to resolve, one of which is fares and value for money. I recognise the concerns expressed by my hon. Friend regarding the fares between Cheltenham and London, as well as those raised by passengers around the whole wider issue of rail fares.

I should just explain where we are on this matter and put the issue into context. Fare revenue is vital in the day-to-day running of our railway operations and the massive upgrade programme to which my hon. Friend referred and which is taking place all around the country. Of course, that is all focused on benefiting passengers. We know that any increase in rail fares may affect the budgets of working people and their families, and we want passengers to know that they are getting value for money. As a Government, we want to help people to keep more of their own money, which is why we have increased the personal allowance and frozen fuel duty and so on. In the world of rail, that means that, since 2014, the Government have ensured that increases to regulated rail fares have been restricted to inflation only. Indeed, 2019 will be the sixth year running in which fare increases have been capped in this way.

I am aware that it might sometimes seem that the fares offered for sale on our railways are always expensive, but there are many very cheap fares offered for travel, especially if people are able to book in advance. For example, it is possible to purchase an advance standard single fare from Cheltenham Spa to London from as little as £14.50. We want to continue to ensure that passengers feel the benefits of fare availability that suits them, and we want them to have access to affordable fares. That is why we are exploring how to link fare increases to the more commonly used consumer prices index measure of inflation in the future. At the moment, it is linked with the retail prices index. To be sustainable, income and costs to the rail industry have to change in parallel. Linking fare increases to the CPI without parallel changes in the cost base would simply mean higher costs to taxpayers year on year. The Secretary of State would like to work together with the rail industry, the Office of Rail and Road, the regulator, the unions and the Rail Delivery Group to ensure that the CPI, not the RPI, is used as the basis for industry staff cost deals in the future.

[Alex Chalk]

I am very grateful to the Minister for his helpful response. Does he agree that the review also needs to consider structural discrepancies? Although I take the point about restricting the rate of increase, if in fact that does not address the underlying structural discrepancy, the perversity and unfairness remain. Does he therefore agree that this needs to be looked at in the round?

[Andrew Jones]

Basically, yes I do; indeed, I am coming to that point.

What I am trying to get across is that, as an industry as a whole—with industry colleagues—we can keep the sector as efficient as possible, continue the income through the farebox and plough that back in to make our rail network even better, with investment in infrastructure and rolling stock.

As my hon. Friend highlighted, my predecessor did indeed acknowledge that the fare system is in need of thorough reform, and my priorities are no different at all. I am a regular rail user, of course, and I understand that there can be anomalies in the fare system that can feel unfair to passengers, and we must explore changes to remedy this situation. There can be perverse pricing on our network and we are going to tackle that.

The Williams rail review that was announced by the Government earlier this year will take a root-and-branch look at the system, including considering how the railway can offer good value fares for passengers while keeping costs down for taxpayers. The RDG and Transport Focus recently ran the Easier Fares consultation, which closed in September, where they asked passengers to give their thoughts on how fares could be improved. My Department is looking forward to seeing the results. I met the RDG yesterday and it told me that it would publish the results of its consultation early next year. Both the Williams review and the results of the Easier Fares consultation will support discussions on reforming the fares system to better deliver improvements for passengers. I want to see simpler, more easily understood fares. As my hon. Friend knows, we committed in our manifesto to review rail ticketing and to remove the complexity and perversity that we see in pricing. This is indeed the root-and-branch review that he mentioned.

Together we can help to improve the service that passengers receive on our trains. We are working closely with the industry to deliver a better offer to passengers who travel on fewer than five days per week. Work patterns are changing—we can recognise that and see it all around us—and rail ticketing has to become more flexible to allow part-time workers access to more cost-efficient fares. We will seek proposals from Great Western Railway, as part of its direct award, on how it might be possible to introduce more flexible products while of course ensuring that they are affordable and represent value for money for taxpayers too. This has not yet had quite as much publicity as it might. As well as working with industry to improve the quality of the rolling stock and the infrastructure, we want the industry to introduce initiatives that both benefit passengers and bring about growth in rail travel.

The RDG has announced the introduction of a 26 to 30-year-olds’ railcard that will reduce the cost of rail travel for young people by up to a third on certain tickets. This will be rolled out nationally from 2 January. We welcome this initiative—I am sure that everyone would—as we believe that it will improve opportunities for young people through making travel more affordable and increase social mobility. My hon. Friend mentioned his worry that the cost of rail travel can be discouraging for economic activity in terms of people visiting his constituency. I hope that the introduction of this railcard, as announced by the industry and the Chancellor, will help them and be welcomed by my hon. Friend and others.

Cheltenham Spa is a fantastic place; I know it very well, actually. It has regular services to and from Birmingham, Bristol and London, with services operated by Great Western Railway and CrossCountry. To support improvements to the amenities of the station itself, a masterplan for the station has been promoted, with the local authority playing a leading role. My hon. Friend mentioned increased car parking. Additional car parking is a key element within the planned package of improvements, with a new multi-storey car park planned.[Official Report, 8 January 2019, Vol. 652, c. 4MC.] These improvements are strongly supported by Great Western Railway. They also include easier pedestrian access, extra bicycle storage, and a more user-friendly bus interchange. The improvements will accommodate growing demand, particularly once the improved London services are introduced using brand new Intercity Express trains. There is a significant amount of investment to make changes to benefit his constituents.

One point that is raised repeatedly by colleagues is work that is taking place across the network to make it more accessible. We have a Victorian infrastructure, of course, and successive Governments have, over many years, run a programme called Access for All that is about making stations more accessible for people who may struggle with mobility. Everybody benefits from that, because it could just be about managing luggage, having an easier route, or travelling with little ones in pushchairs. Lots of people will benefit. We are continuing that work. There is a £300 million budget for the expansion of Access for All in control period 6, which starts next year.

Design work is currently taking place to create a new, accessible route to Cheltenham Spa station under that programme. Work to begin installing the new accessible route is planned to start next autumn and will include the installation of lifts to all platforms, to help passengers gain access to their platforms more easily. That is very positive news, and I hope it will be recognised and welcomed in Cheltenham.

My hon. Friend referenced the new rolling stock. GWR has supported the station improvements and introduced new Intercity Express trains on its network, supporting better services for passengers. It is replacing old British Rail-era trains. That seems a long time ago; my hon. Friend said he could just about remember it, but I remember it clearly. Those new bi-mode trains are a vast improvement. They are cleaner running, faster, more spacious, offer a significantly more pleasant experience and are more efficient to run. The new trains are already entering service, and each one delivers more capacity, with 76 more seats available for passengers. However, the work does not cease there. Once those trains are introduced, passengers will continue to see improved journey times and greater reliability. Maintaining operators’ ability to invest in our railways is a crucial part of the ongoing development of both the Cheltenham to London route and Cheltenham Spa station.

I thank my hon. Friend and the hon. Member for Stroud (Dr Drew) for their contributions to the debate. We will continue to look at ways of both improving services and keeping the cost to passengers as low as possible, while maintaining value for money for taxpayers. The case for reform is strong—we have recognised that and agree with it. The question is how we take it forward.

While specific details of the Williams review are expected next year, many of the concerns shared by my hon. Friend and his constituents will be addressed by that review. The review has launched its call for evidence, which is an important step in its initial phase, and the review team hopes to hear from a wide range of stakeholders across the country. I encourage constituents to get in touch with the team and make any contributions that they feel are relevant. I will ensure that my hon. Friend’s speech is sent to Mr Williams for consideration.

Next year, we will see more improvements to the service that passengers from Cheltenham receive—new, faster trains with a greater capacity continuing to be introduced, improvements to Cheltenham Spa station and further development of the station’s accessibility under the Access for All programme.

We will also have a longer-term review of our rail industry, which has been such a success over the last 20 years. It has gone from nationalisation and decline to privatisation, with 1 billion more passenger journeys a year—a huge growth—but is it structured as well as it should be for the next phase of its life? That is the question that Mr Williams has to answer. It is a great opportunity to ask broader questions, including about the Department’s role in the industry. I will ensure that my hon. Friend’s points are considered and that the rail review includes fares, to make them simpler and nimbler and eliminate any perversity, so that we encourage more people on to our railways, including those from Cheltenham.

Question put and agreed to.