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Oyster revenue allocation question
A mate and I got into a discussion about how the revenue from the
Oyster card is allocated between participating operators. If I make a journey on a bus at a cost of £1, I assume the £1 goes to the bus operator (possibly with deduction of a service charge). If I then travel on the tube at a cost of £2.20, logically this money would go to London Underground. This brings the total spend to £3.20. Next I travel on DLR with a fare of £2.20. I then make a second journey on the tube. This money can go to London Underground. Total spend is now £5.40. Now suppose I go on DLR with a fare of £2.20. This makes a total of £7.60. At this point the price cap kicks in and the cost is limited to £5.80. I then get on another bus (£1). Who gets paid what? Does the first bus operator and London Underground get paid in full, DLR in part and the second bus operator not get paid at all? Or do they all have their payment scaled back on a pro rata basis? Or do none of them get paid the actual fare and they all take a share of the total Travelcard revenue? Or looking at it another ways If I only make one journey, on a bus, does the bus company keep the £1 or do they get a pre-determined share of the total Oyster money instead? Thanks Scott |
#2
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Oyster revenue allocation question
"Scott" wrote in message news A mate and I got into a discussion about how the revenue from the Oyster card is allocated between participating operators. If I make a journey on a bus at a cost of £1, I assume the £1 goes to the bus operator (possibly with deduction of a service charge). If I then travel on the tube at a cost of £2.20, logically this money would go to London Underground. This brings the total spend to £3.20. Next I travel on DLR with a fare of £2.20. I then make a second journey on the tube. This money can go to London Underground. Total spend is now £5.40. Now suppose I go on DLR with a fare of £2.20. This makes a total of £7.60. At this point the price cap kicks in and the cost is limited to £5.80. I then get on another bus (£1). Who gets paid what? Does the first bus operator and London Underground get paid in full, DLR in part and the second bus operator not get paid at all? Or do they all have their payment scaled back on a pro rata basis? Or do none of them get paid the actual fare and they all take a share of the total Travelcard revenue? Or looking at it another ways If I only make one journey, on a bus, does the bus company keep the £1 or do they get a pre-determined share of the total Oyster money instead? AIUI London operators don't take revenue risk. So all farebox income whether cash fares, paper travelcards, or Oyster goes to TfL who pay operators agreed sums for operating the service. I'm not sure how it works with National Rail TOCs, who do take revenue risk. Peter |
#3
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Oyster revenue allocation question
On May 29, 8:37*pm, "Peter Masson" wrote: "Scott" wrote: A mate and I got into a discussion about how the revenue from the Oyster card is allocated between participating operators. *If I make a journey on a bus at a cost of £1, I assume the £1 goes to the bus operator (possibly with deduction of a service charge). *If I then travel on the tube at a cost of £2.20, logically this money would go to London Underground. *This brings the total spend to £3.20. *Next I travel on DLR with a fare of £2.20. *I then make a second journey on the tube. *This money can go to London Underground. *Total spend *is now £5.40. *Now suppose I go on DLR with a fare of £2.20. *This makes a total of £7.60. *At this point the price cap kicks in and the cost is limited to £5.80. *I then get on another bus (£1). Who gets paid what? * Does the first bus operator and London Underground get paid in full, DLR in part and the second bus operator not get paid at all? *Or do they all have their payment scaled back on a *pro rata basis? *Or do none of them get paid the actual fare and they all take a share of the total Travelcard revenue? Or looking at it another ways If I only make one journey, on a bus, does the bus company keep the £1 or do they get a pre-determined share of the total Oyster money instead? AIUI London operators don't take revenue risk. So all farebox income whether cash fares, paper travelcards, or Oyster goes to TfL who pay operators agreed sums for operating the service. I'm not sure how it works with National Rail TOCs, who do take revenue risk. You're absolutely correct in saying that under the current system London bus operators do not take the revenue risk at all. London Buses (the part of TfL that contracts out to bus operators), London Underground, the DLR, London Overground and Croydon Tramlink are all part of the "TfL family" - though I must admit I'm somewhat hazy on how farebox revenue gets divided up internally within the TfL family, i.e. between LU and DLR etc - and I don't think it's as straightforward to say that it just gets divided up as such either. (Also LOROL, the operator of the London Overground network, doesn't take the revenue risk but gets paid an agreed amount according to their performance; on the DLR I think the operator, Serco Docklands, is subject to a similar regime, though I think they might get some of the farebox take - plus there's the infrastructure concessionaires who built and maintain the more recent extensions - e.g. CGL Rail for the Lewisham extension - who I think get payments based on patronage of those sections of the line). Those National Rail TOCs who currently accept Oyster PAYG for at least a part of their routes in London have reached an agreement with TfL - in the case of routes that have interavailable ticketing (easiest example being Stratford to Liverpool Street) I'm not sure they had any choice in the matter, but for other routes where there's no interavailable ticketing (e.g. West Drayton to Paddington) they have done so voluntarily. However without a doubt one of the major issues in the ongoing negotiations to get all TOCs to accept Oyster PAYG across London is how farebox revenue will be allocated - and the issue is not just how much should go to the 'National Rail' TOCs as such but also to which specific TOC it should go. |
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Oyster revenue allocation question
On 29 May, 22:09, Paul Corfield wrote:
On Fri, 29 May 2009 20:31:27 +0100, Scott wrote: A mate and I got into a discussion about how the revenue from the Oyster card is allocated between participating operators. *If I make a journey on a bus at a cost of £1, I assume the £1 goes to the bus operator (possibly with deduction of a service charge). *If I then travel on the tube at a cost of £2.20, logically this money would go to London Underground. *This brings the total spend to £3.20. *Next I travel on DLR with a fare of £2.20. *I then make a second journey on the tube. *This money can go to London Underground. *Total spend *is now £5.40. *Now suppose I go on DLR with a fare of £2.20. *This makes a total of £7.60. *At this point the price cap kicks in and the cost is limited to £5.80. *I then get on another bus (£1). Who gets paid what? * Does the first bus operator and London Underground get paid in full, DLR in part and the second bus operator not get paid at all? *Or do they all have their payment scaled back on a *pro rata basis? *Or do none of them get paid the actual fare and they all take a share of the total Travelcard revenue? Or looking at it another ways If I only make one journey, on a bus, does the bus company keep the £1 or do they get a pre-determined share of the total Oyster money instead? As others have stated the fare revenue for TfL provided or contracted services goes to TfL directly. *Payments are made to the operators (such as bus companies) based on a contracted fee which is adjusted up or down according to the performance of the service. *I believe DLR works on the same basis with Serco who operate the service being paid on a performance adjusted fee basis. * As Mizter T indicated there are two sections where infrastructure is also privately provided on DLR so a separate fee is paid the consortia who built and maintain the Lewisham and Woolwich extensions. I believe this is also a performance (availability) based fee although the Lewisham line was originally based on a "shadow toll" whereby there was effectively a ridership based incentive as an amount would be paid for every passenger carried. *However given the consortia had no right to set DLR fares there was not really a direct linkage between ridership and what the consortia controlled. The Overground concession is similar to DLR whereby all revenue goes to TfL and LOROL (the operator) is paid a fee subject to performance of the services and a range of other service attributes. I believe there is some financial upside for LOROL if performance reaches very high levels and also if there are very low levels of revenue fraud. As LUL is not operated "on contract" then it has its own budget for revenue and operating costs but this is set by TfL and the money collected from ticket sales still goes forward to TfL for allocation and apportionment in accordance with the various agreements for the different products. I am not entirely sure what happens with the PAYG revenue as there are parallels with the Travelcard "pot" given the use of capping but NR participation is much lower. *Clearly many journeys are accurately recorded via PAYG and it is possible to see which operator is used in many circumstances. *In some cases it is not possible to see what route is taken (Highbury to Richmond via LUL or via Overground) so there must be an element of apportionment in addition to the ability to allocate individual trips. *I will have a look at the TfL intranet to see if a PAYG apportionment document exists as there was certainly a document explaining how Travelcard revenue is apportioned (via a Travelcard survey process which defines the modal and then operator split). *If I find some more info I'll post a follow up. Where Oyster travel is against a Travelcard held on the Oyster card then the total revenue is shared as per the Travelcard Agreement factors. You also need to bare in mind that there are other flows of money for single and return tickets and also through tickets between LUL and NR which have their own agreed rules for apportioning revenue and payment of commission for the ticket selling activity. *Oyster PAYG cuts in to this area as it will typically displace cash sales and you have the issue of cash being paid up front and then being "drawn down" from the card balances (at passenger level). *Nonetheless if a journey has happened on a TOC train where PAYG is valid then some revenue has to reach the TOC. *I do not know what the nature of the agreements is for TOC acceptance of PAYG but I would guess it is some sort of combination of provisions from both the Through Ticketing Agreement and also the Travelcard agreement (given the daily capping element). -- Paul C Cheers for that info, I was wondering about this issue myself and couldn't really work out how it would work. You mentioned that singles and returns vary from travelcards, and in the same vein oyster capped journeys also vary from oyster singles, but with Oyster you do have more information about the journeys than travelcards, so revenue allocation *could* potentially be more representative. LOROL, DLR, and LUL journeys can all be grouped under their seperate headings, but I find the revenue allocation for NR operators much more confusing, and I'm starting to see why take-up of Oyster PAYG acceptance in South London is taking so long, they can't quite decide how to work the system. There are 2 main options. They could A) put all Oyster PAYG revenue into one fares pot and then divvy it up in whatever way they like, which would be agreed with the operator before (which probably being discussed now) or B) allocate revenue based on which operator was used for the journey, so if the Oyster is used on LUL and NR equally, then it would be half and half, or if the journey was 3/4 LUL and 1/4 NR then the revenue from that individual journey would be divvied up on the same basis. Obviously it is easier for multiple tube line journeys, because they are all LUL, and this revenue doesn't need to be allocated per line because it is all grouped. NR is a lot more complicated and I can't quite work it out, whether the powers that be have thought this through or not remains unknown. The easiest way to solve the problem would be to adopt a LOROL style approach to ALL suburban services in London, whereby the service frequency and operations are determined by TfL and operated under contract by the respective TOCs. This way they would remove the revenue-risk nonsense from the TOC and the fares etc would be determined by TfL and collected for TfL. The more difficult (by far) option would be to allocate fares on a similar basis to the national rail model, whereby fares (oyster or otherwise) are based on the route taken and the operator on that route. So if the route was Southern only then southern would get the revenue from the single fare. (This analysis only concerns single fares at this point). Then if the route was operated by multiple TOCs then you would divvy up the fares based on the same theory as national rail tickets which divide the fare based on the number of seats and services provided on that route etc. This would be difficult, to say the least, but at least *possible* ish. Oyster capping however would add another complication to the mix because the single fare which previously would have been wholly allocated to a particular TOC would now be reduced since the oyster reductions for further journeys are 0. To be honest it would be easier at this stage to *give up* as it were, and simply adopt a travelcard revenue allocation method. But maybe it could be possible to only divide up the total revenue between the operators used and the operators not used on this occasion get nothing? Not sure if this would make the revenue allocation skewed on Oyster/non-Oyster routes though. Southern seem to be gaining oyster readers at many of the stations I have visited recently, so they are going to be accepting oyster PAYG soon presumably, the main barrier to implementation being revenue allocation, and not lack of Oyster readers. Well, that's my tuppence worth, I would go on, but that's enough I think!!!! |
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Oyster revenue allocation question
"D DB 90001" wrote The easiest way to solve the problem would be to adopt a LOROL style approach to ALL suburban services in London, whereby the service frequency and operations are determined by TfL and operated under contract by the respective TOCs. But wouldn't that effectively mean that almost the entire rail network in the south-east would be decided by TfL - a body controlled by the mayor of just part of that network? Most south-east services are to, from, through London. |
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Oyster revenue allocation question
On 30 May, 23:38, "Richardr" wrote:
"D DB 90001" wrote The easiest way to solve the problem would be to adopt a LOROL style approach to ALL suburban services in London, whereby the service frequency and operations are determined by TfL and operated under contract by the respective TOCs. But wouldn't that effectively mean that almost the entire rail network in the south-east would be decided by TfL - a body controlled by the mayor of just part of that network? Most south-east services are to, from, through London. Ah, I was only referring to Z1-6 services which usually terminate inside zone 6, but I didn't take account of services which terminate at South London Termini and call at a Z6 station only, but no intermediate stations. I didn't think that through, forgetting about the journey opportunities which you have at East Croydon for example, which would be oyster payg compatible, but also have fast services that would inevitably have to be included in the oyster system. That probably wouldn't work as I thought then. However, I still think that local suburban services that *do* terminate inside of Z1-6 or at stations such as Sevenoaks or Dartford just outside Z6 should be managed by TfL, just like all bus routes, even those which run outside of London but are mainly inside Z1-6, are managed and run by TfL. Frankly because TfL are more likely to get better results than other local authorities or DfT. |
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Oyster revenue allocation question
"D DB 90001" wrote However, I still think that local suburban services that *do* terminate inside of Z1-6 or at stations such as Sevenoaks or Dartford just outside Z6 should be managed by TfL, just like all bus routes, even those which run outside of London but are mainly inside Z1-6, are managed and run by TfL. Frankly because TfL are more likely to get better results than other local authorities or DfT. But the capacity on the roads isn't constrained in the same way as that on the railways. I believe that a lot of London commuter routes run at pretty much capacity at peak times. Allowing one part of the route to determine what happens there fixes what happens elsewhere. Take Thameslink, for example, which stops and potentially stops at a lot of London stations. If the Mayor of London had sole rights to determine stopping patterns in London, then he would, quite rightly for him and his electors, choose patterns wanted by his constituents, which I would imagine would mean stopping all trains at all stops in Greater London. Thus those passengers from outside London, e.g. Brighton and Bedford, would get a massive deterioration in service. I can't see why letting London alone decide the Thameslink timetable in its own interests is such the bonus you think to Brighton or Bedford people? Isn't it the same for most south-east routes - nearly all of which are designed mainly for non-Londoners to get to and from London, or share tracks with such a route? |
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Oyster revenue allocation question
On 31 May, 09:03, "Richardr" wrote:
"D DB 90001" wrote However, I still think that local suburban services that *do* terminate inside of Z1-6 or at stations such as Sevenoaks or Dartford just outside Z6 should be managed by TfL, just like all bus routes, even those which run outside of London but are mainly inside Z1-6, are managed and run by TfL. Frankly because TfL are more likely to get better results than other local authorities or DfT. But the capacity on the roads isn't constrained in the same way as that on the railways. I believe that a lot of London commuter routes run at pretty much capacity at peak times. Allowing one part of the route to determine what happens there fixes what happens elsewhere. Take Thameslink, for example, which stops and potentially stops at a lot of London stations. If the Mayor of London had sole rights to determine stopping patterns in London, then he would, quite rightly for him and his electors, choose patterns wanted by his constituents, which I would imagine would mean stopping all trains at all stops in Greater London. Thus those passengers from outside London, e.g. Brighton and Bedford, would get a massive deterioration in service. I can't see why letting London alone decide the Thameslink timetable in its own interests is such the bonus you think to Brighton or Bedford people? Isn't it the same for most south-east routes - nearly all of which are designed mainly for non-Londoners to get to and from London, or share tracks with such a route? ....which is why all the different service patterns should probably largely have their own tracks. Strange as it is to hold the WCML up as a paragon of "doing it right", but aside from the missing stop at Willesden Junction and having the lines grouped by use not direction, it works so extremely well that all you could do to improve it, probably, is to add the aforementioned two things above. Perhaps reduce headways to squeeze in a few more peak trains...but that's about it. All because the London stopping pattern in the Urban / Inner Suburban "New" lines doesn't affect the Inner / Outer Suburban "Slow" lines, which in turn doesn't affect the Intercity "Fast" lines. Pairing by direction would let you potentially run a service that dealt with the inner suburbans properly. Currently the New lines are too long, forcing you to change to the Slow line services at Harrow for a reasonable journey time, which being on opposite sides of the footbridge and with a poor service frequency, means dangerous crowds scrambling across it to get between them. Ideally, the trains would be the things doing the moves between lines, not the passengers, or at the very least, it would offer a cross-platform interchange. Put in a shared platform loop between the New and Slow lines where possible and the New lines' services could then be multiplied and sped up with non- stopping services (or more WJ-EUS shuttles), making stops at Harrow for outer surburbans less important. That would give a better service for Londoners without impacting on those living beyond Watford. The new shuttle services being run between Watford Junction and Euston in the peaks show this sort of solution can work, but they will forever be constrained by the fact that the slow lines are primarily outer suburban services who want to run fast between Watford and Euston. Same goes for the former GCML. Jubilee covers the all-stations Urban stops, the Met covers the Inner and Outer Suburbans, and Chiltern covers the remnants of the Intercity option. Mixing with the fast Mets north of Harrow is fine given the lack of route north of Aylesbury and the option of diverting via Princes Riseborough....but if it did ever pick up more services north of there that became popular, maybe quad- tracking from Watford South Junction to Amersham or wherever the Met terminates might be worthwhile. Or, for simplicity, give Chiltern everything north of Moor Park, and let them fund quad tracks...thinking about it, might make a better case for electrifying it too, if they have their own dedicated tracks all the way. |
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Oyster revenue allocation question
On 31 May, 09:03, "Richardr" wrote:
"D DB 90001" wrote However, I still think that local suburban services that *do* terminate inside of Z1-6 or at stations such as Sevenoaks or Dartford just outside Z6 should be managed by TfL, just like all bus routes, even those which run outside of London but are mainly inside Z1-6, are managed and run by TfL. Frankly because TfL are more likely to get better results than other local authorities or DfT. But the capacity on the roads isn't constrained in the same way as that on the railways. I believe that a lot of London commuter routes run at pretty much capacity at peak times. Allowing one part of the route to determine what happens there fixes what happens elsewhere. Take Thameslink, for example, which stops and potentially stops at a lot of London stations. If the Mayor of London had sole rights to determine stopping patterns in London, then he would, quite rightly for him and his electors, choose patterns wanted by his constituents, which I would imagine would mean stopping all trains at all stops in Greater London. Thus those passengers from outside London, e.g. Brighton and Bedford, would get a massive deterioration in service. I can't see why letting London alone decide the Thameslink timetable in its own interests is such the bonus you think to Brighton or Bedford people? Isn't it the same for most south-east routes - nearly all of which are designed mainly for non-Londoners to get to and from London, or share tracks with such a route? OK, yes, TfL controlling Thameslink probably wouldn't be a good idea, but then I was suggesting that Thameslink would be included because I would have classified thameslink as an outer London service, because the main core services on thameslink only call at the major London termini at STP, Farringdon, Blackfriars and London Bridge, and then East Croydon only, not calling at the intermediate stations, and a fair proportion of the route is outside Z1-6, so it would be classified as a local London suburban service. The problem is that this problem in differentiating the services between London Suburban and outer-London services that happen to call at some, but not a lot of London stations is not always obvious. |
#10
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Oyster revenue allocation question
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