No, TfL is not planning to scrap peak hour fares on Fridays

Transport for London (TfL) has denied reports that it is considering scrapping peak hours fares on Fridays to boost post-pandemic recovery in travel on the London Underground.

There was a report in the i paper at the weekend, and picked up elsewhere, that TfL was looking at eliminating the morning peak hours fares on Fridays, as is already the case at weekends. The impetus suggested is that with many more office based people commuting Tues-Thur, there’s a desire to boost travel on Friday (and Monday) mornings and that scrapping rush hour fares on Fridays may help encourage people to commute on Fridays as well.

However, TfL has denied the report is true.

It would be a surprise for TfL to look at cutting peak rate fares as they’re on record previously as saying that although higher fares lead to lower usage, it’s a far smaller ratio than people generally expect, and within London, there’s some reason to suggest the same with fare cuts.

(Outside London, bus fares in particular are much higher, so fare reductions have seen a much bigger impact on usage)

Ultimately, people have to travel, and while some discretionary travel may decline when fares are higher, it’s not a substantial impact. There is however something that does lead to a much larger reduction in passenger numbers, and that’s cutting services.

Given the choice between a cut in fares that is unlikely to be covered by higher passenger numbers, or raising fares to improve services, you are more likely to see an increase in passengers — and hence revenue — from providing a better service than from a cheaper one.

In fact, TfL’s Director of Strategy and Chief Technology Officer, Shashi Verma outlined what effect price cuts and service cuts have on the revenue at a GLA Transport Committee meeting on 17th January 2023.

Describing a research paper based on 50 years of fares and services in London as a “gripping read”, he pointed out that while “a 1% increase in fares leads to a 0.3% reduction in demand, a 1% service cut leads to something between 0.6% to 0.8% reduction in demand”

With the numbers, he noted that “on balance, the thing that you have to consider all the time when looking at fares decisions is how to keep the system fiscally whole so that you are not engaging in service cuts, which are far more destructive than fare increases.”

So for TfL to recover its finances in the post-pandemic world, a focus on quality of service is likely to generate a faster recovery than cutting peak-hour fares on a Friday morning.

This is not a huge surprise when given some thought — people have long prized having a reliable and frequent service over almost any other measure when it comes to travel — and when asked to think about the options, most people tend to be willing to pay for a reliable service instead a cheaper one.

Obviously, everyone wants lower fares and better services, but that’s a hard circle to square.

On the issue of changing fare structures to encourage more travel on a Friday, this also seems a bit of a non-starter, thanks to the way TfL already caps pay as you go fares.

At the same GLA meeting in February, Shashi Verma outlined that TfL’s existing flexible fares system with the daily and weekly caps would make it difficult to adjust the fares structure to support more flexible working patterns.

Responding to a question from Siân Berry AM about changing fares to reflect changes to working patterns, Verma said that TfL has “a system where the daily caps are one-fifth of the weekly caps, which means that if you only work two days a week, you pay for two-fifths of a week. If you work five days a week, you pay for the whole week. It is not clear what more we could do to support the flexible working patterns because we have had that in place in London.”

And that’s really why the idea of scrapping peak rate fares on a Friday has been dismissed by TfL — as the flexible fares system is already optimised to the point that it wouldn’t make a difference to London’s commuters.

Of course, you might not save money, but travelling on Fridays will still get you a slightly more pleasant journey as about a quarter of people avoid the morning rush hour on Fridays, and having a nicer commute to work is not to be sniffed at.