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Private Rail Firms Rip Off Passengers By Over £150 Million On Refund Payouts

27 September 2012

Private rail firms have ripped off passengers by over £150 million on refunds for delayed trains in the past year, the TSSA union revealed today.

They received £172 million for late running trains from taxpayer funded Network Rail but only paid out a small fraction of that to passengers, £10 million, according to figures obtained under the Freedom of Information Act.

The DfT stats highlight the tight fisted approach of the private rail firms to the only public owned company, East Coast, which paid out £6.6 million in refunds in the last financial year compared to an average of just £400,000 from each of the 22 privately run firms.

Releasing the figures, union general secretary Manuel Cortes called on the Commons Transport Select Committee to mount an inquiry into what he called "daylight robbery" of both taxpayers and rail pasengers.

"This amounts to a rigged system whereby the private rail firms get millions from the taxpayer if their trains are five minutes late and the poor passenger only get a full refund if their train is two hours late.

"The fact that the publicly run East Coast line is paying out 15 times more than the average for the private operators when it comes to refunds shows that there is something seriously wrong with the current system.

"If the private operators were as open and honest as EC, they would have paid out well over £100 million rather than a miserly £10 million.

"East Coast is pro-active when it comes to giving out refunds, telling passengers on board and at their stations how to claim. Private firms prefer to play Scrooge, placing as many hurdles as possible in their way before handing over any cash."

He pointed out that East Coast paid out twice as much as the seven private operators combined which reported refunds to the DfT.

He is writing to Louise Ellman, chair of the Transport Select Committee, urging her to mount an immediate inquiry into a system which is a "a one way ticket for the private rail firms to pocket millions".

"We need parliamentary action to stop this racket now. Passengers are being taken for a ride."


Refunds paid out by Train Operating Companies for 2011/12

East Coast             £6,616,000

CrossCountry           £1,022,000

First Capital Connect  £  637,000

Southern               £  £522,000

East Midland Trains    £  291,000

London Midland         £  173,000

Southeastern           £  148,000

Greater Anglia         £  120,000

* Only eight companies report their figures to the DfT. 

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