Agenda item

Support Services Review - Senior Railcards (Agenda item 7)

Report of Michael Wassell, Executive Member for Finance & Democratic Services.

Minutes:

The Vice-Chairman and the Internal Consultant for Business Development introduced the report and summarised the main points.

 

Senior Railcards had been looked at as part of a review of Support Services which was managed by the Finance Team.

 

Almost 20 years ago an agreement had been made between 15 councils in Norfolk and Suffolk to collectively buy 10000 cards a year in exchange for discounts that could be passed on to residents.  Breckland had been chosen to coordinate bulk purchasing and this had been carried out pretty much unchanged since 1994.

 

The landscape had changed a lot in that time and the number of passenger journeys continued to rise, increasing by 19% in the last 4 years alone; however, railcards sales by the Council had dropped by 19% in the same period.

 

No costs were recovered or any administration fees charged for this work; unlike some councils.  It took around 6 hours of officer time per week to order, distribute and sell railcards, equivalent to approximately £3000 a year.

 

The processes to order and sell the railcards were quite complex and often went wrong in the background, which was one of the reasons the Business Development Team chose to look at this work.  It was found, by chance, that the supplier was planning to change its own processes so it could deal with its customers direct and phase out the sale of railcards by councils.  The Council had to react to these changes as there was no choice as the service would end at some point soon.

 

The supplier had an idea for an arrangement that would mean that residents could carry on getting the 25% discount for one year and possibly some discount thereafter; however, this would mean that customers would not be able to walk into one of Breckland Council’s Service Centres and walk out with a railcard.

 

The alternative being recommended was to withdraw from railcard ordering and sales, and instead, signpost residents to the best available alternative.  This might entail going to the local train station, buying on-line or over the telephone.  There were many ways to receive discounts such as 10% off for renewing on-line, 22% for buying a 3 year railcard as well as Tesco Clubcard deals – all of which many of Breckland’s residents could benefit from.

 

The recommended option would also bring a time saving of 5 to 6 hours per week and whilst this was not currently cashable, it would be added to cumulative efficiency savings from other projects in the support service review.

 

Other Councils had been alerted that were affected by these changes, including North Norfolk, Norwich and South Norfolk.

 

It was believed that the recommended option would avoid messing people around twice, and would mean that the Council was acting proactively to a change that was being imposed by the railcard supplier.  Should Members’ be mindful to approve the recommendation, a plan had been drawn up to implement the preferred option (option B).

 

The Executive Member for Internal Services had a problem with the alternative method of purchasing a railcard on-line that was being recommended particularly when he had seen sight of the facts highlighted in the next agenda item in relation to Breckland having a higher than average level of retired people of which most would not own or have access to a computer.  The Chairman advised that other alternative methods of purchasing railcards were available such as by telephone or at the train station itself.  The Executive Member for Assets & Strategic Development drew attention to section 3.45 of the report that highlighted the alternative methods available.

 

Options

 

A number of options would have been considered and put forward for discussion that were no longer available due to changes to the processes for ordering and selling railcards being introduced by ATOC.  These options could have included recharging other authorities for ordering, or transferring the ordering function to another authority in the buying group.  As it stood these were no longer options, ‘do nothing’ was not an option because of ATOC’s changes and therefore only two options remained available for consideration:

 

Option A

 

Implement temporary ATOC process for one year, followed by ceasing the Senior Railcards service (see report for further details).

 

Option B

 

Cease the Senior Railcards resale service (see report for further details).

 

Reasons

 

Option B – To cease the Senior Railcards resale service – was recommended for the following reasons:

 

Due to the changes being introduced by the Association of Train Operating Companies (ATOC), both options would mean a significant change for residents.  Customers would no longer be able to walk in to a Council Customer Service Centre, buy a railcard and walk out with it there and then.  The main benefit of option A was that residents would continue to receive the current discount level, though only for one year, and it would take considerable planning and resource to implement the temporary process.  In effect, Option A would mean that the Council introduced changes twice in one year that would have a negative impact on residents – once to adopt the temporary ATOC process (resulting in residents losing access to same-day railcards) and again a year later to cease selling railcards (resulting in residents losing access to the 25% discount).  The Project Team felt there was little merit in implementing change that would negatively impact residents twice and that a single change would be easier to implement, have less overall impact on residents and with less potential for negative publicity.  The Communications Team had been consulted and shared this view.

 

Option B would have the same impact as Option A (no same day option) and also mean that residents would not be able to access the discounted price during the one year transition period.  This impact was well mitigated as other means were available to residents to obtain discounted railcards from alternative sources.  In addition, the full cost of a railcard (£30) was more than covered by national average annual savings on rail travel costs (£113).  This option also avoided the need for two sets of changes and two sets of negative publicity.  Only one change would need to be implemented and publicised, and the reason (ATOC’s changes) could be made clear at that point.

 

RESOLVED that the cessation of the resale service of Senior Railcards by Breckland Council from 13 September 2013 be approved.

Supporting documents: