Straight answers: Railway finances
What is the balance between the money from taxpayers and passengers for running the railway?
The long-term trend is that the passenger, through money from fares, is contributing more to the running of the railway.
Who is investing to improve the railway?
Money from fares covers most of the day to day running of the railway, which means that money from both the public and private sectors can go towards investing to improve.
Governments have provided Network Rail with £53bn funding between 2019 and 2024 to run and improve the railway. Between 2017-2025, over £15.7bn private sector investment is going towards 8,000 new train carriages on the network.
How much subsidy do private operators get?
Policy decisions meant that last year train operators paid £0.8bn less to government because more was paid in charges to Network Rail and to invest in new trains. Network Rail received the same level of funding overall as the government reduced the level of funding they provide by the same amount.
This meant that, in 2018-19, £0.4bn more was paid to operators by government, than by operators to government.
The long term trend of the last five years shows that operators made a net contribution of £2.4bn to government which has freed up taxpayer money to invest in a better railway.
Is more money invested into cities and the South than elsewhere?
Train operators and Network Rail are working together to deliver record investment in rail on routes across the entirety of Britain, with half of the country’s trains being replaced, new for old, and billions being put into making the network more reliable.
Read more about investment happening in your area.
The delivery of HS2 alongside the upgrade of the existing network means that increasing levels of investment to improve services is being delivered outside of London and the south east.
How much profit do train companies make?
Paper tickets aren’t going anywhere soon and we want to ensure everyone can buy their ticket with confidence. We are just using technology to give people more choice about how and when to buy their
On average train operating companies make two percent of profit, however not all train operators make a profit, and they only make a profit if they run their franchises successfully, which means attracting more passengers to travel and by offering a good service.
When this happens, it generates extra revenue and the main beneficiary is the British taxpayer. That’s why the cost to taxpayers of running the railway is a quarter what it was in the 1990s, while train company margins are only two percent.
Do foreign owned train companies take profits abroad and use them to keep fares down in other countries?
Train companies in the UK on average make two per cent profit, these margins made by train companies are not sufficient to have any meaningful impact on the level of fares in other countries.
Some fares can be lower in other countries because governments there choose to put more taxpayer money into running the trains. Train operations in Britain receive some of the lowest levels of government support of any country in Europe, which means more money needs to be raised through fares.
In fact, some of our trains are run by British companies which successfully operate buses and trains abroad, which is good for British passengers and taxpayers.
What is the railway doing to stop fare dodging?
Everyone who uses the railway needs a ticket to travel or they risk receiving penalty fares or being prosecuted. The small minority who fare dodge deprive the railway of about £200million every year, money which could otherwise be spent investing to improve the railway for everyone.
Ticket barriers are one way of ensuring people have a ticket and where they are not in use, ticket inspectors will carry out checks.
To avoid criminal prosecution, some train operators have penalty fares that they can impose on customers who use rail services but who did not purchase a ticket when there was the facility to do so. Special dispensation can be made for occurrences including technical failures at stations which prevented the passengers from purchasing tickets.