Overview
This study provides a quantified assessment of the impact of poor rail performance on employee and business productivity. It offers a credible and authoritative basis for evaluating the magnitude of impacts omitted or underestimated by conventional appraisal methods.
To provide a quantified assessment of the impact of poor rail performance on passengers, employees and business.
This study has employed a number of data collection and analytical techniques, including a literature review, questionnaire surveys and a desktop study.
Funding
Results
This study has identified four broad areas of harm:
1/ Direct harm to business travellers and business - estimates from the desktop study suggest that business travellers incur approximately £1 billion of disutility per annum due to poor rail performance, which is equivalent to nearly £6.80 per single journey. Significant numbers of non-travellers (secondary impact) may also be adversely affected by delayed business travel, potentially raising the damage estimate.
2/ Indirect harm to business - evidence from the literature review suggests that employees' productivity is reduced by around 13-18% after undertaking an unreliable and congested journey. However, it is unclear how long this reduction in productivity lasts. The literature review also suggested that difficulty travelling to work reduced job satisfaction, potentially raising staff turnover, and increased absences due to illness.
3/ Commuters - evidence from the literature review indicates that unreliable and congested travelling conditions can double the observed stress levels among travellers. The desktop study estimates that commuters incur approximately £500m of disutility per annum due to lateness and unreliability.
4/ Leisure travel and tourism - the desktop study estimates that leisure travellers incur around £650m of disutility per annum due to poor rail performance. The disutility caused by poor rail performance may be as high as 10% of average tourist expenditure on trips within the UK.
Policy implications
Overall, the evidence from this study shows that poor rail performance has a significant impact on individuals, the economy, and society in general. The estimate for total disutility (relative to an ideal world of zero delays) is equal to around £2.2-£2.5 billion per annum, which is approximately equal to two-thirds of the total annual ticket sales of the railway. Arguably, this is a conservative estimate, as it does not include some external effects, such as the effect on business meetings. Consequently, improvements in rail performance have a significant value attached to them. For example, if each train operator were to reproduce its best year of performance, total disutility, as calculated by the OXERA model, is likely to fall by around £900m per annum.