Is the rail ticket market innovative and competitive enough to serve the interests of passengers?

John LarkinsonImprovements in technology are changing the way passengers buy their rail tickets and the form of the ticket itself is changing rapidly. Ticket offices remain popular but rail passengers are now making greater use of the internet and ticket vending machines to buy tickets. They have greater choice and more convenient forms of tickets, with smart ticketing and mobile ticketing. They are also buying more of their tickets from parties other than their train company, such as online retailers.

There will be more changes and part of our role as the rail regulator is to keep markets under review. We want to make sure the ticket-selling arrangements are ready to adapt to new technological developments and changes. We particularly want to ensure they can deliver benefits to passengers, both now and in the future. 

For that reason, the ORR is conducting a review of how retailers sell rail tickets. 

Our initial analysis identified potential benefits, but also issues with the current arrangements. Evidence shows that the arrangements appear to protect some passengers when buying a ticket. They provide passengers with the flexibility and convenience of an integrated, national network. They also enable retailers to collaborate to improve their services to passengers. 

However, current arrangements pose a cost, which may be disproportionate. They may inhibit innovation at the expense of improved services to customers. They may constrain retailers' commercial flexibility in how they sell tickets and they may create a conflict of interest among retailers.

We want to understand the role the incentives, industry governance rules, processes, and systems play in – not just protecting the interests of consumers but also – empowering passengers to make the best choices, both now and in the future.

In particular, we will want to see how/if the industry practices:

  • Give passengers access to a range of tickets through sales channels to suit their needs. 
  • Empower passengers with clear, accurate and timely information when they need it and.
  • Give passengers clear choices they can exercise by easily comparing against different providers.

The regulator is currently inviting views from stakeholders, industry and passenger groups on how the retail ticket market is working and to share any examples of benefits and concerns until 31 October 2014.

For more information on how you can get involved, visit: http://orr.gov.uk/consultations/policy-consultations/open-consultations/retail-market-review-consultation.