Whilst a clear distinction between welfare maximising structure and one that is intended to maximise revenue is not always possible it should be noted that the case studies given here are primarily welfare maximising. Having said that, one or two of the examples appear to have succeeded in increasing revenue.

Case study 1 - Verkehrsverbund: regional public transport in Germany, Austria and Switzerland

Context

The Verbund system is a means by which public transport is integrated at a regional and local level. Fares and services for all routes and modes are carefully co-ordinated throughout the whole of the region. The system of planning has succeeded in greatly improving the quality of public transport as a mode able to compete with private car. More attractive fares have played an important part in achieving their success. (Pucher and Kurth, 1996)

The Verbund systems' fare policies are characterised by the following features:

• Uniform, integrated fare structure across all operators and modes;
• complete through-ticketing meaning that one ticket is sufficient for any journey using various modes and operators;
• very attractive monthly and yearly tickets with very large discounts compared to one trip tickets;
• weekly, four-day, three-day and one-day tickets are available so that one of the alternatives will suit most users;
• a simplified zonal fare structure (in every system except Munich's );
• fare reductions were combined with service expansion and marketing with the fare structure forming an important part of the marketing campaign with monthly and yearly tickets branded as environmental tickets to emphasise the environmental benefits of public transport; and
• most Verbund offer tickets which include public transport tickets in the entrance fees for concerts, sports events, conventions and festivals.

Impacts on demand

It is reported that the combination of lower fares, a wide variety of tickets, and a simplified zonal system providing predictability have all contributed to patronage increases in the Verbund regions. Service expansion and marketing have also played an important part with mode share either stabilising or increasing, in sharp contrast to the trends elsewhere and in those regions before the Verbund system was introduced. Because these policies were implemented simultaneously it is generally not possible to separate out the effects of each factor (Pucher and Kurth, 1996). In the case of Zürich however Hensher (Hensher 2004) does cite a study which suggests that the combination of the co-ordination of services and the development of a single zonal fare system led to an increase in overall public transport patronage of 12%, with increases of 53% and 30% for feeder buses and heavy-rail respectively (Laube 1995). Hensher is however of the view that the conclusions should be treated with caution. None of the studies presented evidence on the level of patronage that had transferred from car. It is almost certain that there will have been some transfer from car but the exact level cannot be estimated.

Impacts on Supply

The success of the Verbund systems has been at significant financial cost with the operating deficits growing steadily and the percentage of operating costs covered by passenger fare revenues falling. Despite increasing patronage, there has also been an increase in subsidy per passenger trip. As a result, in more recent years several of the Verbund have responded by implementing cost-cutting measures with frequency cuts on underutilised routes.

Objective	Contribution to objective	Comment
		There will have been a reduction in car use, but the size of this reduction and therefore any associated efficiency gain, is uncertain. On the other hand, public transport use whose costs are not being met does represent an inefficiency.
		Any reductions in car use are likely to have contributed to a liveability improvement.
		Any reductions in car use will have contributed to a reduction in environmental impacts.
		The reduction in prices for regular users will have benefited less well-off existing users and those that have transferred from car.
		Any reduction in car use is likely to have helped improve safety.
	?	Efficiency improvements due to reduced traffic will support economic growth and there may also be economic benefits from improved public transport accessibility. However, the increased tax burden necessary to fund the fare structure (and service improvements) may stifle economic growth.
		The cost of implementing the current fare structure is substantial.

	= Weakest possible positive contribution,		= strongest possible positive contribution
	= Weakest possible negative contribution		= strongest possible negative contribution

= No contribution

Case study 2 - Connecticut Transit (evidence taken from TCRP report 94)

Context

Connecticut Transit (CT Transit) operates three state-owned transit systems serving Hartford, New Haven, and Stamford with a total fleet of 341 buses. Total system patronage in 1999 was approximately 27 million.

This case study examines the impacts of the "New Fare Deal" that was introduced in June 1998 and consisted of the following elements:

• elimination of local fare zones;
• introduction of an electronic one-day pass that could be issued on board buses;
• introduction of a seven-day rolling pass (electronic activation on first use);
• replacement of the monthly pass with a 31 day rolling pass activated at any time on first use;
• introduction of an electronic 10 ride farecard; and
• uniform fare structure for the three CT Transit operations as well as several other state contracted local services in nearby towns.

The payment options were (and at the time of writing still are) based on GFI's TRiM magnetic read/write technology.

Elimination of Local Fare Zones

The local fare structure was eliminated to increase the convenience and simplicity for passengers. Also, market research had shown that "downtown" was no longer the destination for a majority of trips with increasing numbers of trips from one suburb to another. This introduced inequities in trip costs because a passenger travelling along a radial Route and crossing zone boundaries would pay far more than one making a suburb to suburb journey that did not cross zone boundaries. This distortion may be seen as particularly undesirable because it would encourage suburb to suburb trips which are generally more expensive to cater for with public transport than those to the city centre. The objectives of eliminating the local zone system can be summarised as follows:

• Improve passenger ease of understanding and payment of fares, so increasing patronage;
• improve the efficiency of fare collection for the operator and make the system fairer;
• support welfare to work/reverse commute initiatives (commuting from deprived inner-city areas to jobs in the suburb); and
• reduce administration costs associated with zone based passes.

Introduction of new passes and multiple trip tickets

As well as eliminating the local fare zone structure, CT Transit decided to exploit the electronic processing capabilities of its GFI TRiM units and introduced various electronic payment options:

• one day pass ($2.5) for purchase on board buses or at any sales outlet;
• seven day rolling, activate on first use pass ($12)
• 31 day rolling pass ($38) replacing the monthly pass that was valid for a specified calendar month; and
• multiple trip tickets for 10 trip ($9, representing one free trip).

Upass Programme

In 2000, CT Transit began a pass programme with two colleges in Hartford, Trinity College and capital community college totalling just under 5000 students. The UPAS is magnetically encoded allowing the number of trips to be tracked each time it is inserted into the on-board TRiM unit. The colleges are charged $0.65 per trip up to a ceiling of $20 per student per semester, after which no additional charge is made to the college for subsequent journeys.

Impacts on demand and supply

Table 18 below gives a detailed breakdown of the impacts of the New Fare Deal on patronage and revenues.

The impacts over the four-year period can be summarised as follows:

• a 4% drop in revenue;
• a 2% drop in patronage (although the trend is not clear);
• a 9% drop in the use of cash;
• a 48% drop in the use of tokens since the introduction of multiple journey tickets;
• steady growth in the use of one-day and seven-day passes;
• an overall increase in pass use of 34% but within that an 18% decline in 31 day passes ;
• an overall slight drop in the average fare per trip.

Contribution to objectives

Objective	Contribution to objective	Comment
		Impact on car use and therefore congestion unclear. The high take-up of new ticket options suggests that they are valued by customers. Reduced administration costs for the operators and reduced fraud.
		No obvious change.
		No obvious change.
		Removal of zonal system benefited reverse commuters from the deprived inner cities to jobs in the suburbs
		No obvious change.
	?	There are apparent benefits to passengers but these do not seem to have translated into patronage growth. There may also have been an increase in the subsidy requirement, potentially increasing the tax burden.
	?	There has been a small drop in revenue but this may have been compensated for by reduced administration and enforcement costs.

	= Weakest possible positive contribution,		= strongest possible positive contribution
	= Weakest possible negative contribution		= strongest possible negative contribution

= No contribution

Case study 3 - Maryland Mass Transit Administration (MTA) (evidence taken from TCRP report 94)

This case study describes and presents the results of a fare simplification initiative through the elimination of zones and transfers and the introduction of the day pass;

Also described is a regional fare integration programme using smartcard technology, but as this is in the recess of implementation, no results are yet available.

Context

The Maryland Mass Transit Administration (MTA) operates transit services throughout the state of Maryland, with most of its service concentrated in the Baltimore metropolitan area. MTA's core services include bus (71 million trips), Metro (14 million trips), light rail (9 million trips) and commuter rail (6 million trips) giving a total system patronage of approximately 100 million per annum.

In the years prior to 1996, MTA's patronage and revenue had decreased. Its fare structure had evolved over the course of more than 100 years in response to various pressures and constraints. The resulting fare structure was very complex making it difficult for passengers to understand and for employees to enforce. A market research exercise was conducted involving both passengers and staff to develop an understanding of the best and worst aspects of the fare structure.

Elements that were liked included:

• Weekly and monthly passes;
• fare payment options;
• the fare payment locations; and
• flat fare on light rail.

Elements that were disliked included:

• zone fares (complex, too many);
• transfers confusing;
• no integration between commuter rail and light rail; and
• evasion perceived to be high.

MTA needed to achieve its patronage and revenue goals including the requirement to recoup 50% of operating costs through fares. After considering various options with respect to these goals the following changes were made in March 1996:

• The five zones in the core service area were eliminated;
• transfers were eliminated;
• the day pass was implemented;
• also some minor fare changes such as the reduction of the monthly pass discount, an increase in commuter bus and commuter rail fares, and an increase in the discount for senior and disabled passengers; and
• services were also reduced by 4%.

Strategies were required to deal with the issue of how the newly introduced day pass could be issued and used on bus, Metro and light rail. The strategies adopted for each mode were as follows:

• Bus: The initial plan was for operators to be given books of day passes for on-board sale but operators were concerned with the risk of robbery associated with handling a valuable commodity. MTA resolved the problem by installing Almex machines onto the on-board fare boxes; these consist of a control panel connected to a thermal printer. A passenger wishing to purchase a day pass would insert cash into the fare box and the operator would then issue a pass using the Almex machine. On subsequent trips that day, the pass holder simply shows the pass on boarding.
• Metro: The Almex machines (and fare boxes) were also installed at the station attendants' booths at each metro station. The system was the same as on the buses but the station attendant would also issue a pre-encoded magnetic "exit ticket" for use at the barriers of the destination station. This was necessary because the day passes have no magnetic strip.
• Light rail: Ticket Vending Machines (TVM's) were easily reconfigured to issue day passes that would be used in the same way as those issued on buses and at metro stations.

Impact on demand

Impact on supply

Summary of impacts

The Fare simplification scheme appears to have led to the following benefits:

• an increase in patronage in the first year (as shown by Table 20 above) and then continued growth between FY 1997 and FY 2000, with an 11% increase from 98 to 109 million passengers.
• a significant increase in revenues in the first year with a subsequent stabilisation over following years (revenues have not increased in line with patronage because the increasing use of day passes has led to a fall in average fare paid)
• less confusion and so fewer disputes regarding fare payment through the elimination of fare zones and transfers;
• more convenient fare payment due to the day pass;
• reduction in the cost of travel for many customers through the elimination of fare zones and introduction of the day pass;
• greater flexibility in transferring between vehicles and modes;
• faster boarding times in the p.m. peak because most day passes have already been bought and also because of a more even distribution of passengers throughout the day;

Contribution to objectives

Objective	Contribution to objective	Comment
		Although no evidence is presented on diversion rates, some of the increased patronage is likely to have transferred from car so reducing traffic congestion. Reduced boarding times and increased fare payment convenience also represent efficiency gains. Increased revenue and patronage despite the service level reduction also implies greater efficiency.
		Any reduced car traffic will provide a benefit here in terms of reduced local air pollution, noise and severance.
		Any reduced car traffic will provide a benefit here in terms of reduced air and noise pollution and less pressure on natural resources.
		Reduced cost of travel will benefit less wealthy passengers.
		Any reduction in road traffic is likely to lead to a reduction in accidents.
		Any reduced traffic congestion is likely to be economically beneficial as is the reduced subsidy requirement of the public transport system.
		The significant increase in revenue combined with reduced operating costs has dramatically improved the financial position of the operator.

	= Weakest possible positive contribution,		= strongest possible positive contribution
	= Weakest possible negative contribution		= strongest possible negative contribution

= No contribution

MTA Development of Regional Fare Integration

MTA's service area overlaps with that of numerous other operators which means that interchange from MTA to other operator's services is not unusual. Table 24 below lists the various operators that have connections with MTA services:

Operator	MTA Local Bus	MTA Commuter Bus	MTA Metro	MTA Light Rail	MARC Commuter Rail
WMATA Metrorail
WMATA Metrobus
Howard Co. CTC
Connect-A-Ride
The Bus (P.G. County)
Ride-On (Montgomery Co.)
PRTC-Omniride
Annapolis Transit
Hartford Co. Transp. Services
Frederick Transit
Virginia Railway Express

To aid interchange across operators the state of Maryland is implementing a programme that will eventually enable the purchase of smart cards that will allow seamless interchange between all the operators listed in the table above. As of June 2006 the scheme is being rolled out and tested although it is not clear when it will be fully operational.

The expected benefits will be:

• Multiple payment options and seamless travel;
• ease-of-use: contactless technology allows for easier and faster access to the system especially for some passengers with disabilities;
• ability to restore the cards remaining value if the card is lost or stolen;
• one card can be used to store several different ticket products for different operators. For example the card could contain simultaneously a monthly pass for MTA services as well as a multiple journey ticket for WMATA services.

Case study 4 - Brighton and Hove bus company flat fare scheme

In the Brighton-hove conurbation the local bus company, part of the go-ahead group, switched from a distance based graduated fare scale to a widely advertised single flat fare of £1. This meant that there was an overall increase in fare levels which could be expected to reduce patronage. The scheme was introduced on a trial basis but was continued because of its popularity. The certainty of knowing how much it will cost to board the bus appears to have led to rising revenues and a year-on-year patronage growth of 8.5%.

Bus drivers also like the flat fare because it simplifies their job and improves boarding times, increasing bus reliability. The scheme is to be continued for the foreseeable future but it is likely that some of the benefits will be lost when the benefit of a round figure fare is lost when fares increase. (Transit 2002) No evidence is presented on levels of transfer from car.

Contribution to objectives

Objective	Contribution to objectives	Comment
		Although no evidence on diversion rates is presented some of the increased patronage is likely to have transferred from car so reducing traffic congestion. Reduced boarding times and increased fare payment convenience also represent efficiency gains.
		Any reduced car traffic will provide a benefit here in terms of reduced local air pollution, noise and severance.
		Any reduced car traffic will provide a benefit here in terms of reduced air and noise pollution and less pressure on natural resources.
		The increase in fare will disadvantage less wealthy passengers.
		Any reduction in road traffic is likely to lead to a reduction in accidents.
		Any reduced traffic congestion is likely to be economically beneficial as is the reduced subsidy requirement of the public transport system.
		The increase in revenue will have improved the financial position of the operator.

	= Weakest possible positive contribution,		= strongest possible positive contribution
	= Weakest possible negative contribution		= strongest possible negative contribution

= No contribution

Case study 5 - The Octopus card (Hong Kong)

The Octopus card was introduced in September 2007 in Hong Kong’s mass transit system. It is a stored value smart card that is contactless. It is used to transfer electronic payments in online or offline systems. The Octopus card system was the first contactless smart card system in the world and has since grown into a widely used payment system for almost all public transport in Hong Kong.
The Octopus card can also be used for payment at convenience stores, supermarkets, fast-food restaurants, on-street parking meters, car parks, and other point-of-sale applications such as service stations and vending machines.

There are two main types of Octopus card (On-Loan and Sold) and two less common types (the Airport Express Tourist and the MTR Airport Staff):

• On-Loan cards are issued for use in day-to-day occasions, mainly for fare payment in transport systems. They are further differentiated into Child, Adult, Elder, and Personalised categories, with the first three based on age and different amounts of fare concession. With the exception of the Personalised cards, On-Loan cards are anonymous as no personal information, bank account, or credit card details are stored on the card. A student on-loan Octopus Card was initially issued, but has been discontinued since 2005. The Personalised card is available on registration. The name and, if opted, a photo of the holder are imprinted on the cards. They can function automatically as a Child, Adult, or Elder card by recognising the cardholder's age stored on the card, hence accounting for different concessionary fares. In addition to all the functions of an ordinary card, this card can also be used as a key card for access to residential and office buildings.  All cards have require payment of a HK$50 refundable deposit.

Table 26: Types of On-Loan Octopus cards

Type	Picture/Colour	Cost and use
Child		Children aged between 3 and 11. This card is sold for HK$70 with an initial value of HK$20. Children's fares are deducted where applicable.
Student		For students attending secondary schools and universities. Discontinued in 2005 and replaced by Personalised Octopus Card.
Adult		The standard version of the Octopus card. This card is sold for HK$150 with an initial value of HK$100. This colour is also used for the logo of Octopus Cards Limited, the operator.
Elder		Eligibility varies between different public transport companies, and even between operating routes of the same type of service—for example, 60 years of age or above for Citybus, 65 for KMB. If no elder fares are available, adult fares are deducted. This card is sold for HK$70 with an initial value of HK$20.
Personalised		The rainbow-coloured Personalised card is available on registration. This card is sold for HK$100 with an initial value of HK$30 and a handling charge of HK$20. Students may also qualify for this card at HK$90 with their pictures and names.

• Sold cards are sponsored and branded cards which are frequently issued by the card operator as souvenirs. These cards are sold at a premium, have limited or no initial stored value, and cannot be refunded, but they can otherwise be used as ordinary cards.
• The Airport Express Tourist Octopus card is a special purpose card designed to target tourists in Hong Kong. Two versions of this card are offered: which allow one or two airport single journeys which are valid for 180 days from the date of purchase. Both versions allow three days of unlimited travel on the MTR and include a HK$50 refundable deposit. Usable value on these cards may be added if necessary. These tourist Octopus cards may be used only by tourists staying in Hong Kong for 14 or fewer days; users may be required to produce a passport showing their arrival date in Hong Kong.
• The MTR Airport Staff Octopus is also a special purpose card but it is only available to the staff of Hong Kong International Airport and AsiaWorld-Expo, a convention centre close to the airport, for commuting at a reduced fare between the airport (reduction of up to 64%) and MTR stations via the Airport Express.

Impacts

There are over 19 million Octopus cards in circulation at the moment according to the card operator Octopus’ website. The cards are used by 95% of Hong Kong’s population aged 16 to 65, generating over 10 million daily transactions valued at HK$ 90 million. Over 2000 service providers accept the Octopus card and over 50,000 Octopus readers are deployed in Hong Kong.

Objective	Contribution to objectives	Comment
		The cards allow discounted fares and period tickets to frequent travellers. Reduced boarding times and increased fare payment convenience also represent efficiency gains, especially as boarding a bus in Hong Kong without the card requires payment by exact change. The cards also allow payments at various retail outlets.
		Although no evidence is presented on reduced car traffic, assuming that the efficiency and convenience of the Octopus card has reduced car traffic through increased use of public transport, this will provide a benefit here in terms of reduced local air pollution, noise and severance.
		Any resulting reduction in car traffic will provide a benefit in terms of reduced air and noise pollution and less pressure on natural resources. The decline of paper tickets will be beneficial for the environment, as customers will be using a card they already own to top-up.
		Increased public transport patronage will help support improved services, with buses in particular being an important mode for providing accessibility to target groups.
		Any resulting reduction in road traffic is likely to lead to a reduction in accidents.
		Reduced traffic congestion is likely to be economically beneficial as is the reduced subsidy requirement of the public transport system.
		The increase in revenue will have improved the financial position of the operator.

	= Weakest possible positive contribution,		= strongest possible positive contribution
	= Weakest possible negative contribution		= strongest possible negative contribution

= No contribution

Case study 6 - Introduction of London Travelcards

The London Travelcard is a time period pass valid either for one-day, three-day, seven day, one month or one year. The card is valid on all TfL services including bus, underground, Docklands Light Railway and trams in London, but not the ferries) in the zone specified on the card.

Research has indicated that the introduction of the Travelcard in London in 1983 increased the number of underground trips by 10% and bus trips by 16% (Gilbert and Jalilian, 1991). Travelcards replaced London Underground season tickets which meant that one card now gave access to unlimited travel on both London Underground and London buses. Bus revenues increased by 14% whilst underground revenue dropped by almost the same amount. This effect was partly because London Underground had previously kept 100% of the revenue from season tickets whereas with the travel card 30% went to London buses (Gilbert and Jalilian, 1991). Fowkes and Nash also studied the introduction of the London travel card also finding that the introduction of the travel card stimulated demand. Fairhurst (1993) found that passenger miles increased by 18% on buses and 28% on the Underground, with an overall increase of 24%. Whilst a direct comparison between figures in different studies should be treated with caution, it is interesting to note that mileage as measured by Fairhurst has increased significantly more than trips (as measured by Gilbert and Jalilian). This may suggest that the Travelcard is encouraging longer journeys, particularly on the Underground where journey time may be less of a barrier.

Contribution to Objectives

Table 28: Contribution to Objectives

Objective	Contribution to objectives	Comment
		Although no evidence is presented on diversion rates, some of the increased patronage is likely to have transferred from car so reducing traffic congestion. Reduced boarding times and increased fare payment convenience also represent efficiency gains. If longer journeys are indeed being encouraged this can be seen as an inefficiency.
		Reduced car traffic will provide a benefit here in terms of reduced local air pollution, noise and severance.
		Reduced car traffic will provide a benefit here in terms of reduced air and noise pollution and less pressure on natural resources.
		Increased public transport patronage will help support improved services, with buses in particular being an important mode for providing accessibility to target groups.
		Reduction in road traffic is likely to lead to a reduction in accidents.
		Reduced traffic congestion is likely to be economically beneficial as is the reduced subsidy requirement of the public transport system.
		The increase in revenue will have improved the financial position of the operator.

	= Weakest possible positive contribution,		= strongest possible positive contribution
	= Weakest possible negative contribution		= strongest possible negative contribution

= No contribution

Case study 7 – The Oyster Card (London)

The Oyster card was first issued to the public in July 2003 by Transport for London and is used on public transport services in Greater London in the UK. This card also takes on the London Travelcard highlighted in the previous case study and integrates it amongst its various pricing structures. The card is valid on the London Underground and Overground, buses, trams, the Docklands Light Railway and some National Rail services. It was first issued with a limited range of features and there is continued phased implementation of further functions. It is a form of electronic ticketing being a stored value card which can hold single tickets, period tickets and travel permits which have to be added to the card before travel. It is also a contactless smart card with a claimed proximity range of about 8 cm (3 inches) that passengers have to pass over electronic readers when entering and leaving the transport system in order to validate it or deduct funds. The cards may be ‘recharged’ in person from various sales points, by recurring payment authority or by online purchase. The card decreases the number of cash transactions at ticket offices and the number of single paper tickets sold on the London transport network. Usage is encouraged by offering substantially cheaper fares on Oyster than payment with cash.

The card uses MIFARE technology and is operated by TranSys for Transport for London. The technology used for the Oyster card is known as radio-frequency identification (RFID), which is the same technology used in other electronic pass cards. The Oyster card acts as an aerial while the reader acts as a receiver. However this technology means that the cards transmit information whenever they come into range of a reader and it has been suggested that a good reader could read personal details from quite a distance. Aluminium shielding has been suggested to prevent any personal data from being read.
Types of fare structures on the card:

• Period travel cards: The Oyster card aims to replace the paper Travelcard (as highlighted in the previous case study) by storing period tickets electronically. An Oyster card can hold up to 3 season tickets at the same time. Season tickets are bus & tram passes or travel cards lasting 7 days, 1 month, or any duration up to one year (annual). These types of travel card holder do not need to "touch in" at the start of a journey or "touch out" again at the end unless they intend to travel outside the zones for which their travel card is valid. If they need to "touch in" or "touch out", as long as the travel card holder stays within their permitted zones no fare will be deducted from the pay as you go funds on the card. The Oyster system checks that the travel card is valid in the zones it is being used in. If the user travels outside the valid zones of their travel card, any remaining fare due may be deducted from their pay as you go funds.
• Pay as you go: As well as travel cards and bus passes, Oyster cards can also be used as stored-value cards, holding electronic funds of money. Amounts are deducted from the card each time it is used, and the funds can be "recharged" when required. The maximum value that an Oyster card may hold is £90. This system is known as "pay as you go" (abbreviated to PAYG), because instead of holding a season ticket, the user only pays at the point of use.

The pricing system of the card is fairly complex, and changes from time to time. In order to encourage passengers to switch to Oyster, PAYG fares (including Bus and Tram fares) are generally much cheaper than cash fares: A cash bus or tram fare is £2, while the single Oyster fare is £1, but capped at £3.30 for any number of trips in a day. On the PAYG rail network, a single trip costs £1.60 (compared to £4 cash) within Zone 1, or from £1 (£3 cash) within any other single zone.

A fare capping system was introduced in February 2005, which guarantees that an Oyster card user will be charged no more than the cheapest combinations of single tickets, travel cards and/or bus pass that cover all journeys made that day. A 50p discount is given where the price is capped at the travel card or bus pass rate. Unlike paper daily travel cards, Oyster cards capped at travel card rates are not valid on National Rail services other than those routes which accept Oyster pay as you go. A 34% discount is received by holders of Disabled Persons, HM Forces, Senior and 16-25 National Rail Railcards in the off-peak price cap; individual journeys are charged at normal Oyster pay as you go rates until the reduced cap is reached.

In August 2007, a Bus and Tram Discount photocard was made available for London Oyster card users who received Income Support, allowing them to pay £0.50 for a one way bus trip or buy half price period bus passes. This was the result of a deal between Transport for London and Petróleos de Venezuela to provide fuel for London buses at a 20% discount. The deal with Venezuela was ended by Mayor Boris Johnson and the discount photocard scheme closed to new applications on 20 August 2008. The Bus and Tram Discount Scheme reopened in January 2009, this time funded by London fare payers. The scheme has been extended to people receiving Employment Support Allowance (ESA) and to those receiving Job Seekers Allowance for 13 weeks or more. The fare structure of the Oyster card with the paper ticket across various zones is illustrated below.

Table 29: Fare structure

Oyster photocards, with an image of the authorised user on the card front, are issued to members of groups eligible for free or discounted travel. The cards are encoded to offer discounted fares and are currently available for students in full-time education (30% off season tickets), 16+ cards (child rates for single journeys, discounted period travelcards, free travel on buses and trams for students that live and attend full-time education in London) and for children under 16 years old (free travel on buses and trams and discounted single fares on the Underground, Overground and DLR). A Freedom Pass, with separate non-Oyster photocard, is issued to those over 60 or with disabilities for free travel by their local Borough.

Impacts

Over 10 million Oyster cards had been issued by March 2007, and over 80% of all journeys on services run by Transport for London were made using the Oyster card.

Since the card was introduced, there has been a dramatic decrease in the number of people paying cash fares on buses. This has led to a fall in the usage of station ticket offices to the extent that Transport for London closed a number of ticket offices and reduced opening hours of some others. It was suggested that the staff would be deployed elsewhere on the network.

Contribution to Objectives

Table 30: Contribution to Objectives

Objective	Contribution to objectives	Comment
		TfL believe the cards to be efficient as they reduce TfL costs by being easier for customers to self serve and less cash handling. It frees up staff for other roles. It is also said to sustain affordability giving discounted fares and period tickets to frequent travellers. Reduced boarding times and increased fare payment convenience also represent efficiency gains. The card usage data can also be used for planning purposes.
		Although no evidence is presented on reduced car traffic, assuming that the efficiency and convenience of the Oyster card has reduced car traffic through increased use of public transport, this will provide a benefit here in terms of reduced local air pollution, noise and severance.
		Any resulting eeduction in car traffic will provide a benefit in terms of reduced air and noise pollution and less pressure on natural resources. The reduction of paper tickets will be beneficial for the environment, as customers will be using a card they already own to top-up.
		Increased public transport patronage will help support improved services, with buses in particular being an important mode for providing accessibility to target groups.
		Any resulting reduction in road traffic is likely to lead to a reduction in accidents.
		Reduced traffic congestion is likely to be economically beneficial as is the reduced subsidy requirement of the public transport system.
		The increase in revenue will have improved the financial position of the operator. However the technology of the Oyster card was costly to implement in the initial years and the revenues will need to recoup the costs. As the card is continuously evolving, the additional costs will also need to be taken into account.

	= Weakest possible positive contribution,		= strongest possible positive contribution
	= Weakest possible negative contribution		= strongest possible negative contribution

= No contribution

Case study 8 - Other UK Examples of Ticket Integration

Surrey County Council has made significant investments in several public transport schemes including the Travelwide ticket in Woking. User surveys revealed that the Travelwide ticket had little effect on patronage in terms of take- up by existing users with less than 2% of bus users having tried the Travelwide ticket. The tickets achieved only limited success in generating new bus journeys and the overall conclusion was that the ticket had a negligible effect on patronage (unknown author, 1993)

Apparently more successful was the West Midlands TravelCard scheme introduced in 1972. It was estimated that it resulted in 7% more trips being made by 1981 (White & Brocklebank 1994).

Contribution to Objectives

Objective	Contribution to objective		Comment
	Travelwide, Woking	Travelcard, West Midlands
			Mixed results. Impact on patronage in Surrey was negligible whilst far more significant in West Midlands where the increased patronage is likely to have reduced traffic congestion.
			Reduced car traffic (in the West Midlands case) will provide a benefit here in terms of reduced local air pollution, noise and severance.
			Reduced car traffic (in the West Midlands case) will provide a benefit here in terms of reduced air and noise pollution and less pressure on natural resources.
			Increased public transport patronage (in the West Midlands) will help support improved services, with buses in particular being an important mode for providing accessibility to target groups.
			Reduction in road traffic (in the West Midlands case) is likely to lead to a reduction in accidents.
			Reduced traffic congestion (in the West Midlands case) is likely to be economically beneficial as is the reduced subsidy requirement of the public transport system.
			Revenue details are not given but it is assumed that the increased patronage in the West Midlands case would have increased revenues.

	= Weakest possible positive contribution,		= strongest possible positive contribution
	= Weakest possible negative contribution		= strongest possible negative contribution

= No contribution

Summary of the evidence on the impacts of various fare structure elements

	= Weakest possible positive contribution,		= strongest possible positive contribution
	= Weakest possible negative contribution		= strongest possible negative contribution

= No contribution

	= Weakest possible positive contribution,		= strongest possible positive contribution
	= Weakest possible negative contribution		= strongest possible negative contribution

= No contribution

	= Weakest possible positive contribution,		= strongest possible positive contribution
	= Weakest possible negative contribution		= strongest possible negative contribution

= No contribution