Between the Lines

It’s now the mainstream view that the days when five day a week commuting was the norm are history for most people who worked in offices before the pandemic. While it will still be necessary to ‘go to work’ for many occupations – teaching or nursing can hardly be done from home – the majority of rail commuters have office-based jobs which, at least for two or three days a week, can be done from home. At the same time, many large employers are actively planning to make major reductions in their office floor space, which will require flexible, home-based working for most of their staff for much of the time. Once Covid restrictions are removed, it will take several months for travel patterns to reach any sort of steady state, but the consensus seems to be that commuting may settle at 75% to 80% of pre-pandemic levels, with perhaps an even more marked reduction on Mondays and Fridays.

Chancellor Rishi Sunak has clearly signalled that in the medium-term the Government will need to take action to balance the books, and it’s certain that the rail industry will be in the Treasury’s sights going forward. Furthermore, when the dust has settled, franchises as we have known them over the past 25 years are almost certain to be replaced by competitively let ‘Passenger Service Contracts’, without revenue risk. So cost will become the major criterion, albeit tied to defined quality standards. Bids will no longer be won by zany revenue lines and ORCATS raiding, but by challenging cost reduction strategies.

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