Yesterday it was congratulations to TfL for their transparency and subsequent action over the road structures in urgent need of repair in London.
Today it is a big thank you to the Office of Rail Regulation for publishing their annual report into the finances of the rail industry.
As far I can understand it, the railways – train operators and network rail (which is responsible for the infrastructure) – had a total income of £12.5 billion and an expenditure of £11.6 billion, hence clearing a tidy ‘profit’ or surplus of £900 million. Unfortunately, whilst these are the headline figures taken from Figure 1 of the report, I do not think this is the whole story as a footnote to industry expenditure ominously adds:
“Accruals basis. Industry expenditure was £14.4bn on a cash-basis. The difference is due to capital expenditure on rail infrastructure exceeding the current level of amortisation / depreciation. This is explained in Chapter 5.”
In a way this is by the by. What is perhaps more interesting is where the income comes from:
- £7.2 billion (58%) comes from passenger fares
- £4 billion (32%) comes from Government subsidy
- £1.3 billion (10%) comes from other
Of this ‘other’, £700 million is said to come from train operators’ car parking, property rental and catering activites. Perhaps to avoid blushes there is no indication as to what part of this £700 million is down to parking but hard pressed commuters ,who recognise that when traveling by train the ticket is only a proportion of the entire cost of a journey, will have their suspicions.
The issue is what restrictions there should be on the pricing of parking at stations. Should it be regulated like some of the fares? What is the impact on local communities when high prices for station car parks push people to park in neighbouring streets thus impacting residents?
Suffice to say that as much as running a train business, those involved in operating the trains are also experts in sweating their property assets (as the McNulty report might have put it). And without parking, the profits gained from running the railways would only be a fraction of what they are.