How the government is allowing the Japanese to profit from captive London and Brummie commuters



Earlier this month the Department of Transport extended its recommended list of bidders to run Britain’s railways to a privatised rail company in Japan.

It shortlisted East Japan Railway as a minority partner with the Dutch state rail company Abellio, in the consortium West Midlands Trains Ltd as one of three groups bidding to take over the West Midlands franchise next October. which provides commuter services into London and Birmingham including my home town of Berkhamsted.

But more significantly it decided that East Japan Railway would qualify as an approved bidder for any other franchise up for grabs until 2020.

The Telegraph presented  the bid as a move by a company at the cutting edge of technology as it provides some of  Japan’s bullet train services.

But anyone thinking those on the crowded commuter routes will be whisked in by a super bullet train service should think again.

The story is in fact the exact opposite once you study the company’s latest annual report.

What it shows is that the bedrock of the company’s regular income is its commuter services around Tokyo not its bullet trains. And the prospect for making any more money out of them is a tad bleak.

It reveals that the company is currently facing a downturn in its commuter services serving Tokyo partly caused by a declining population and is looking to expand abroad. It currently provides no services outside Asia – where it is helping develop a mass transit rail system for Bangkok and improve train services in Indonesia.

The annual report says: “Generally, Japan’s declining population is seen as unfavourable for the transportation industry. However, our performance in fiscal 2015 proved that, even in an era of population decline, we can grow revenues by steadily implementing various measures.”

These include developing stations and encouraging more retired people to use local trains as the number of commuters decline.

With lower fares in Japan than the UK, the move could give the operator access to the lucrative London commuter market and it could also offer its services to maintain and build new trains for the British market.

So in other words commuters using London Midland trains to get into Birmingham and London Euston will be contributing to  profits which can be repatriated to Tokyo to offset the declining  Japanese market.

Which makes an investment in London Midland a one way bet for the Japanese since the current Tory government will ensure fares rise every year and the growing population in the UK will all help boost profits.

I would not be surprised to see government ministers in the transport department helping themselves to directorships and consultancies with the company a couple of years after they have stepped down from their posts. After all they have done them a great favour.

I have written about this in Tribune. The three consortia bidding are:a consortium run by London and West Midlands Railway Ltd, a subsidiary of Govia Ltd (a joint venture between Keolis and Go-Ahead Group)’ West Midlands Trains Ltd, currently a wholly owned subsidiary of Abellio Transport Group Ltd with East Japan Railway Company and Mitsui & Co Ltd as minority partners; and MTR Corporation (West Midlands) Ltd, a wholly owned subsidiary of MTR Corporation (UK) Ltd which runs the Hong Kong rail system.

The new London Midland operator will take over in October this year.

Does the train take the strain? East Coast good, London Midland bad

A helpful East Coast express: pic courtesyLocoPix

An unhelpful London Midland train

Travelling around with a recovering fractured shoulder  is not much fun. Particularly if you have to load your heavy luggage on a train. But fortunately there is a free public service offered by the rail companies to get assisted help if  you are disabled. Or is there?

I had two opposite experiences going on holiday from Berkhamsted to Edinburgh. One showed the worst aspect of rail franchise companies, the other the best.

I contacted both London Midland and East Coast Trains by e-mail in advance for help. East Coast trains replied by return, saying my e-mail did not make it clear how much help I needed and giving me a number to ring them for more help. London Midland did not respond and never did.

When I rang East Coast they could not have been more helpful. They took details of the trains, the seat reservation, and because I wasn’t sure how we would arrive at Kings Cross where to go to get assistance on the station.

I then rang London Midland on a freephone number on their website. No reply, not even an answering service and finally a member of staff disconnected the call.

So no help for the journey from London Midland. East Coast – despite the train being overcrowded because of two other cancellations at Kings Cross – kept their bargain. With the luggage space full, the porter obligingly moved the cases to the guards van. At Edinburgh Waverley there was a porter to meet us as we got off the train ( they wanted the seat reservations so he could meet us at our carriage). On the way back to Kings Cross exactly the same experience – the porter even found one case after another passenger had moved it.

Is there a political point in this?  East Coast is state owned, and seems to train its staff to beleive in public service. London Midland is not. It is a state subsidised profit making private operation – whom I have already  crossed swords with issuing ” ghost tickets” at different prices from Berkhamsted. (see earlier blog on this site).

My suspicion is that London Midland’s  disabled help service is a fake, just a cyberspace invention on their website invented by their pr department, to make it look as though they care. Or perhaps their training programme for staff centres on how to lose e-mails and put down phones on customers, thus saving them any inconvenience or cutting into their large proft margins.

Either way East Coast deserve congratulations, the managers of London Midland  need their shoulders breaking.

London Midland’s  response is  attached as a comment to this piece ( see above).

Ghost Ticket from Berkhamsted

A Ghost ticket

A real London Midland train: Picture courtesy Daily Mail

You will all know about ghost trains – those services that run but do not appear to exist on the timetable.

London Midland  have gone one step further – they may be the first railway in Britain to sell ghost tickets.

For the last five months the company has offered us oldies an extraordinary deal if we want to travel in peak times and have the freedom to travel round London.

If you purchase a ticket from the company’s two ticket machines at Berkhamsted station  for a London travel card – you have been able to get a £7.20 reduction on a £22 peak time rail journey.

 But don’t ask for such a ticket at the booking office – because until January they will tell you that no such fare exists and they can’t sell you such a  ticket. As a result by word of mouth hundreds of oldies have been getting a secret third off rail fares to London before 9.30 am.  Up to January tickets were legal, issued by the company and they work all the  entry gates to the tube in London. No one  published the deal in case the foolish London Midland changed its mind and withdrew the ticket.

 London Midland obviously decided they did not want to spend the money altering the ticket machines so  ghost tickets continue to be spewed out of the machine .

Now with the new fare rises the reason has become clear. London Midland had programmed Berkhamsted to accept the a new Anytime £14.80 peak travel card five months before it existed.  It was to be linked with higher fares for those using evening peak trains. No wonder they weren’t going to remove them from the machines.

The extraordinary thing  is this  the now £7.60 reduction is still  available after the fare rise and before 9.30 am from the ticket machines – though the booking office insist it  is now an illegal ticket if you travel before 9.30 am. 

 I don’t know what trading standards would make of it. According to Passenger Focus, the independent consumer group, rail companies are not allowed to issue differently priced tickets to the same place from booking offices and machines at the same station.

The company is recouping any savings for early travellers by charging 30 per cent more if a passenger  goes in after 9.30 but needs to return from London between 4.45pm and 6.45pm. In this case for oldies the fare rises from £11.15 to £14.80.

But if you do travel before 9.30 am on the ticket – the booking office say they will get you.

They say travellers will be stopped at the barrier at Euston – if caught using it -as it won’t work the machines there . However many of the rush hour trains do not use platform 8 to 11 and there not a barrier in sight on other platforms to stop you.

 This is going to make an interesting test case if they do pursue people – for the name on the ticket is Anytime – which if there is any restrictions on travel is a breach of the Trades Description  Act.