MD2018 One hour Bus & Tram transfers

Type of decision: 
Mayoral decision
Code: 
MD2018
Date signed: 
02 September 2016
Decision by: 
Sadiq Khan, Mayor of London

Executive summary

This paper sets out how Transport for London (TfL) will implement the Mayor’s manifesto proposal to introduce a new ‘bus hopper’ fare. This will allow customers to pay only one single fare to use two buses and/or trams consecutively, provided that the second journey commences within an hour of the first.  The associated Direction empowers TfL to implement this fare change on 11 September 2016.

 

Decision

The Mayor:

(i)    Approves the proposed revision to TfL fares to be implemented from 11 September 2016 as set out below; and

(ii)    Directs TfL as per the attached Direction issued pursuant to the power in section 155 (1)(c) of the Greater London Authority Act 1999 to implement these fares on 11 September 2016.
 

Part 1: Non-confidential facts and advice

Introduction and background

1.1    Currently bus pay as you go (PAYG) users are charged a single bus & tram PAYG fare of £1.50 each time they validate upon boarding, unless they hit or have already hit a PAYG price cap.
1.2    Tram PAYG users pay the same single fare when starting a journey by Tram by validating at a Tram Stop.  Interchanges between trams or between one of the seven bus routes designated as a tram feeder route and a tram are free in either direction, provided these take place within 60 minutes of first validating.
1.3    The same PAYG single fares and caps apply to both bus and Tram journeys, therefore the proposed policy applies to both modes.
1.4    The Mayor proposed in his manifesto that Transport for London (TfL) introduce a new ‘bus hopper’ fare, which would allow unlimited changes between different buses within a 60 minute ‘window’ for a flat fare of £1.50.
1.5    As a first step to deliver this pledge, TfL is now proposing that the use of two consecutive buses or the use of a bus and a tram consecutively should incur only a single fare, provided the second journey starts within 60 minutes of the first bus or tram fare being paid.  The existing facility to interchange between trams and the designated tram feeder routes will be extended to all bus routes.
1.6    If a third bus or Tram journey is started within the 60 minutes of the first, a single fare will be charged and a new 60 minute interval will commence.   
1.7    As today, an interchange between Trams within 60 minutes of a previous Tram validation will be free of charge, unless the previous Tram validation was itself a free transfer.  
1.8    These proposals can be implemented in September 2016.  Unlimited bus transfers within one hour are currently not deliverable by TfL’s ticketing systems.  However, TfL has now committed to upgrade its systems by the end of 2018 at the latest.  This development work will result in all bus transfers made within an hour of an initial bus or Tram validation being free of charge. 
1.9    TfL has been consulted on this proposed direction. 
Additional points to note
1.10    The Bus Hopper fare will not be available for journeys taking place in negative balance following a ‘'One More Journey” trip unless the passenger tops up.   A second consecutive ride within the hour of the first journey will then qualify.   Just as today, bus drivers will be expected to exercise discretion and allow vulnerable passengers to board even if their card is in negative balance.
1.11    If a customer changes from bus or tram to rail and then uses another bus or tram within the 60 minutes, the Bus Hopper fare will not apply and the customer will be charged a second single fare. It is planned that this will change following the upgrade of TfL’s systems and unlimited bus journeys will be allowed within an hour irrespective of whether rail modes are also used.
1.12    When the Hopper is formally launched on 12 September, contactless payment cards will not recognise the free Hopper journey if it falls into the next day  ie if the first bus journey takes place  just before the 04 30 end of day time and the second Hopper journey  just after 04 30.  Customers will therefore be charged two single fares.  This issue will be rectified by 15 September.  In the interim, fare corrections will be sent to customers’ payment card accounts, within a week of the second journey charge being incurred.  
1.13    Initially, the Bus Hopper fare will not be available to Oyster card users alighting from a tram at Wimbledon and then boarding a bus after passing through the station gate-line.   This issue will be fully resolved as part of the technology upgrade to offer unlimited transfers within an hour.  Until then, Oyster customers who “miss out” on the Bus Hopper fare at Wimbledon will be sent automatic refunds, within a week of the second journey charge being incurred.   Local publicity will alert Oyster customers that refund corrections are being provided.
 

Objectives and expected outcomes

2.1    The Mayor is under a statutory duty to develop and implement policies for the promotion and encouragement of safe, integrated, efficient and economic transport facilities and services to, from and within Greater London.  The bus hopper fare will improve fare integration and make travelling around London by bus less expensive.
2.2    More specifically, the hopper fare will make the customer proposition for bus users significantly fairer.  Tube and TfL rail users can already make multiple interchanges without incurring an additional fare.  The hopper will put fares for bus users on the same basis.
2.3    The hopper will also reduce significantly the fares paid by customers who use two consecutive buses to get to and from work. The saving for a customer travelling four days a week is £6 a week or £1.50 a day.  The saving per day is the difference between the one day bus cap cost of £4.50 today and the two fares of £1.50 payable once the hopper is introduced.
2.4    Overall, the hopper is expected to reduce the travel costs of around 100,000 bus users per day.
2.5    It is expected that an extra 10 million bus journeys per year will be generated by this reduction in travel costs.
 

Equality comments

3.1    Under section 149 of the Equality Act 2010, as public authorities, the Mayor and TfL must have ‘due regard’ to the need to eliminate unlawful discrimination, harassment and victimisation as well as to advance equality of opportunity and foster good relations between people who share a protected characteristic and those who do not.  Protected characteristics under the Equality Act cover age, disability, gender re-assignment, pregnancy and maternity, race, religion or belief, sex, sexual orientation, marriage or civil partnership status (duty to eliminate unlawful discrimination only).  
3.2    The duty applies to the Mayor’s duty to direct TfL as to the general level and structure of fares under the GLA Act 1999.  The Mayor is not required to conduct statutory consultation on fares. 
3.3    TfL has identified seven groups of Londoners (listed below) who typically face increased barriers to public transport use.  Among the key issues across these groups is the cost of fares.  The hopper will reduce the cost of travel by bus.  This is likely to benefit most Londoners with protected characteristics as follows.
•    BAME Londoners have a younger age profile than white Londoners, are more likely to live in low income households and are more likely to cite barriers to transport.
The reduced fares delivered by the hopper should reduce barriers to travel for this group.
•    Women tend to be the primary carer at home so are less likely to be in full-time employment and more frequently cite affordability as a barrier to transport.
The reduced fares delivered by the hopper should reduce barriers to travel for this group.
•    Older Londoners are more likely to be retired, and therefore many live on low incomes. They also are more likely to be white and/or disabled. For older and disabled Londoners, the greatest barrier to transport is concern over antisocial behaviour, while for all other groups it is overcrowding. 
•    Disabled Londoners tend to be older and are more likely to be white, women or retired. They are also more likely to live on low household incomes. Disabled and older Londoners are more likely to experience difficulties relating to physical accessibility.
The 60 plus concession and the Freedom Pass for the elderly and disabled mean that the hopper will have only marginal effects on these groups.
•    Younger Londoners are less likely to be disabled but more likely to be from a BAME community.
•    Londoners on low incomes. These tend to be women and older, BAME and disabled people, and those not in work. This largely reflects working status, though the causes of low income are tied to education, qualifications, health and, in some cases, transport.
The reduced fares delivered by the hopper should reduce barriers to travel for younger and low income Londoners whose priority tends to be on local trips outside Zone 1 where bus is the primary travel option
•    The LGBT community. Men form the greater part of the LGBT community, which is in contrast to the general population. LGBT Londoners also tend to be younger and have said hate crime is a concern for them.
The hopper has no specific implications for the LGBT community
 

Other considerations

a)    Links to Strategies and Strategic Plan
4.1    The hopper proposal is the first step to delivering one of the Mayor’s key manifesto commitments. 
b)    Risks
4.2    GLA officers consider that implementation risks are minimal.
 

Financial comments

5.1    TfL reports that there are no direct financial implications for the GLA from these proposals and TfL will manage the income from fares. The Mayor’s aggregate level of funding to TfL, principally from business rates, is potentially affected by the level of fares set.
5.2    The financial implication of allowing a free bus and tram pay as you go transfer within an hour will result in a fares revenue loss of around £30m per year.  Additional travel resulting from the Hopper should limit the loss in revenue (£43m revenue forecast to be lost through paid journeys becoming free, whilst scheme is anticipated to generate £13m worth of ‘new’ fares revenue, net £30m). TfL will incorporate the impact of these costs in their new business plan, which will be published later this year. 
 

Investment and Performance Board

7.1        The project has not been considered at this Board, as there are no direct financial implications for the GLA from these proposals

 

Planned delivery approach and next steps

Activity

Timeline

Delivery Start Date

11 September 2016

Formal launch date

12 September 2016