How fair are London’s fares: concessionary schemes and transport affordability

How fair are London’s faresconcessionary schemes and transport affordability 

Earlier this month, the Mayor announced his intention to  introduce a companion pass that would provide free travel across the TfL network to carers of disabled peopleThe announcement sets the tone for Mayoral election that is likely to focus heavily on the capital’s various transport challenges. Given the continued delay of Crossrail and crowded conditions across the network, candidates will have to consider how best to provide a quality service that is affordable while also investing in upgrades and the extension of the network. Given TfL’s budgetary constraints, there is a question how to keep fares low and raise funds – can we have it all?  

In a recent report, Centre for London found that the Hopper fare has cost £552 million in the three years since its introduction and estimate that the Mayor’s Fares Freeze cost £640 million over the four-year term. While the cost of operating these schemes may seem high, they have ensured that the cost of public transport is managed.  

This blog looks at the current availability of concessionary travel schemes in London and asks whether the existing schemes are best targeted to support all Londoners to access the opportunities the city’s growth has enabled.  

When it comes to concessionary schemes, the ‘cost’ of offering these schemes is revenue foregonei.e. revenue that TfL has missed out on by offering discounted travel. The 60+ London pass cost £100 million in 2018/19 in lost revenue, not including the payment TfL has to make to train operators to compensate them for revenues they lose because of the scheme.  

The 16+ Zip Oyster and 18+ Student and Apprentice Oyster cost £109m. While the 60+ Oyster provides free travel on TfL services and parts of National Rail, the concessionary travel schemes targeted at young Londoners provide only free travel on buses (only applied to 16+ Zip Oyster) and otherwise discounted –not free- fares.   

Travel concessions 

Source: Transport for London Business Plan 2020/21 to 2024/25 

There is a fundamental question around whether current schemes are supporting those most in need. Given the numbers of Londoners experiencing in-work poverty or who struggle to access employmentour transport policy should be weighted in favour of those less likely to be able to afford using the public transport service.  

While only 44% of those aged 16-24 are working, this compares to 70% of those aged 50-64 (London Datastore). In terms of earning, mean disposable income in the UK for those under 25 is around £26,350 while for those aged 60-64 it’s estimated around £34,914 (ONS 2019).  

Is it time to start looking at different ways of targeting the capital’s concession schemes beyond age? What would this look like in practice? And how would you do it effectively and efficientlyA review of income and living costs across age and demographic groups would be advisable to determine whether the 60+ card is supporting those most in need of subsidized travel. Given the worrying prevalence of loneliness and the feeling of social isolation, there is also a social value in ensuring that everyone can afford to travel and benefit from all that London has to offer.  

 Ensuring that all Londoners have access to the social and economic opportunities within London is a key priority. Central London Forward is currently conducting analysis and working across the partnership and stakeholders to discuss how we can make sure that all residents can afford public transport

Alison Noehrbass – 15.01.2020