Where’s our rail fare cash going?
Every year, rising train fares seem to generate much debate; perhaps it is time to consider what can be done about it.
One way to reduce fares would be an increased public subsidy, but is it really fair that those who cannot use trains should subsidise those who can? So what can be done?
Every business requires three things - capital, raw materials and labour. The cost of capital, otherwise known as profit, is about 2% for the rail companies so there is not much room for reductions there. The cost of raw material is also quite low, the largest probably being the electricity used to power the trains which only leaves the cost of labour.
Experienced train drivers earn about £50,000 a year, more with overtime. Many would say that this is a fair wage for a responsible job and shifts that can start before 5am, but it is approximately twice the pay of a bus driver whose level of skill and shift pattern must be broadly similar. Many would say ‘well done’ to the NUR and to ASLEF for negotiating such a good deal for their members, but it is important to remember who it is that is ultimately paying these salaries - us.
The next time passengers wish to complain about fare increases, it is worth considering where most of the money is going. Perhaps complaints to ASLEF or the NUR might be more appropriate than complaints to the railway-operating companies.
Maybe we can also ask Labour what they intend to do about the issue of pay in the railway industry.