Ticketing and Concessionary Travel on Public Transport - United ...

Ev 142 Transport Committee: Evidence
2. Does the Government have an adequate strategy for developing the integration of ticketing systems?
2.1 In many ways, the rail <strong>and</strong> bus sectors, often prompted by common ownership, have shown
leadership on integrated transport such that a prescriptive Government strategy has not been required. The
aforementioned PlusBus initiative is a case in point <strong>and</strong> numerous other local initiatives are in place; the
Holmfirth Connection, Heathrow Reading Railair <strong>and</strong> Bristol Flyer airport link illustrate just a few
FirstGroup bus/rail schemes, many of which are long st<strong>and</strong>ing.
2.2 However, Government does have an important role in setting the tone <strong>and</strong> in providing the right
conditions in which integrated transport can flourish <strong>and</strong> we believe the Government has delivered in this
respect. Some examples are discussed below.
2.3 Government has used its powers to exert leverage through franchise agreements by, for example,
requiring train operators to participate in existing multi-modal products <strong>and</strong> many new franchise
agreements include a requirement to provide an Integration Manager which provides a good focus for
developing <strong>and</strong> improving integrated ticketing. The requirement that all TOCs operating franchised rail
services are part of the TSA cannot be underestimated in terms of the maintenance of a fully integrated fares
<strong>and</strong> ticketing system for National Rail.
2.4 With projects such as ITSO, Government has taken a lead in ensuring an “open access” platform for
smartcard technology. This will not only enable interoperability between schemes across the country but
importantly will facilitate the cost-eVective supply of smartcard technology to operators. In addition,
through its underwriting the costs of the Yorcard pilot in South <strong>and</strong> West Yorkshire it is actively helping
the passenger transport industry to underst<strong>and</strong> the role of smartcards as an aVordable <strong>and</strong> reliable multimodal
ticketing channel of the future.
2.5 There is a mechanism within the Transport Act 2000 which enables local authorities to implement
ticketing schemes where it is considered commercial provision is insuYcient to meet customer needs.
However, most schemes remain operator led, testament to the industry taking a lead in the area but also
assisted by the OFT working with the DfT to publish the <strong>Ticketing</strong> Schemes Block Exemption. Published
in 2001 (<strong>and</strong> revised in 2006) this exempts bus <strong>and</strong> train operators from the 1998 Competition Act where
there is a public interest <strong>and</strong> certain protection processes are put in place. This has led to the introduction
of many new schemes.
2.6 Hence, in our view, there can be described to be a Government strategy in place for integrated
ticketing but it is largely market forces through customer dem<strong>and</strong> <strong>and</strong> operator initiative which is driving
implementation.
The Use Of Smartcard Technologies
3. Is the industry taking up modern smartcard technologies adequately <strong>and</strong> appropriately?
3.1 FirstGroup was a leader in the introduction of smartcards with the first commercial scheme in the
UK implemented in our Bradford bus operation in 1999. Since then FirstGroup bus <strong>and</strong> rail operators have
worked with local authorities on the Yorcard project <strong>and</strong> in bus we have worked on local authority initiated
projects in York, Cheshire <strong>and</strong> Southampton <strong>and</strong> in Scotl<strong>and</strong>. First Great Western <strong>and</strong> First Capital
Connect are working closely with Transport for London in relation to the acceptance of Oyster Pay As You
Go on their services. At all our National Rail stations in the Greater London area, we already accept Oyster
<strong>Travel</strong>cards.
3.2 Smartcard technology will naturally be implemented fastest where the customer <strong>and</strong> business benefits
are greatest. This is likely to be in metropolitan areas where the convenience that smartcards oVer will drive
passenger uptake, which will in itself create business benefits such as redeployment of ticket issuing staV to
enhanced customer service roles, less cash h<strong>and</strong>ling <strong>and</strong> reduction of other time consuming back oYce tasks.
3.3 In circumstances where the commercial rationale is less strong, such as where there is a cost eYcient
fares <strong>and</strong> ticketing system already in place, <strong>and</strong> in the absence of any other business imperative, such as a
franchise obligation, it may be less appropriate to implement smartcard technology <strong>and</strong> consideration may
need to be given as to what assistance can be provided if introduction is desirable to meet Government policy
objectives. For example in Scotl<strong>and</strong>, to support the roll out of a national concessionary fares smartcard,
Transport Scotl<strong>and</strong> has provided the necessary investment to fit smartcard readers on buses.
3.4 In relation to the smartcard back-oYce infrastructure (processing transactions etc) consideration
should be given to maximising economies of scale <strong>and</strong> scope through shared industry resources. Within this
context we encourage the current discussions between the DfT <strong>and</strong> the Association of Train Operating
Companies (ATOC) as regards establishing a back-oYce system for the rail industry.