In tandem with a huge programme of capital renewal, Tyne & Wear’s public transport is poised for major changes in the way travellers pay.
Nexus, the Passenger Transport Executive which owns and manages the Tyne and Wear Metro has started to roll out a new ticketing system which, it hopes, will change the way we think of travel.
Tobyn Hughes, Nexus’ director of customer services, says: “It’s a very exciting time, it will transform the way people view public transport ticketing.’’
The new system, a smart card, will eventually replace the old paper ticket system. For Nexus, which is funded by the Tyne and Wear Integrated Transport Authority, making travel easier to buy ties in with the Go Smarter for Business project the ITA is running to encourage commuters to think again about how they get to work, as well as capital schemes to improve the road and Metro rail network.
The aim is a single smart card that can be used not just on Metro but right across public transport, from the Tees Valley to the Scottish border. “The old Metro ticketing system has been around since the system opened,’’ says Hughes.
“It’s very efficient at collecting coins and spitting out the ticket, but it’s old fashioned in that the old machines don’t give change and don’t accept card payment. The world has moved on.’’
Increasing numbers of people have been to London and experienced the capital’s Oyster Card and customer feedback indicated a desire to see improvements to ticket machines including them accepting bank notes and card payments.
This coincided with Nexus’ own desire to improve security on the system by increasing the numbers of staff at certain stations and to reduce travelling without a ticket. That led to a government-funded project to modernise ticketing.
“But we also turned to customers’ wider desires, to get new ways to pay, for us to learn best practice from public transport systems elsewhere. We also decided to expand that project to implement a smart card system,’’ says Hughes.
That process, which has taken some two and half years, has given birth to the Pop Card, a plastic smart card with a chip which is stored on a customer’s travel ticket.
“It’s technology is compliant to a standard known as ITSO (Integrated Transport Smartcard Organisation), a way for different transport and other smart products to communicate with each other using a common language, across the UK.
“That means we can have ticket machines, automatic gates at Metro stations, we can have bus ticket machines, we can have internet sites and different types of payment devices, all of which can communicate with each other using that common language about the user’s electronic ticket.’’
The first group of customers to receive the Pop Card are corporate clients, people who work at businesses which buy tickets directly from Nexus, benefitting from discounts and easy payment terms as a result.
These are organisations such as Newcastle University, health care trusts and the DSS. Pop cards were also introduced to students in university freshers week.
The first smart ticket transaction on the system occurred this autumn when a customer entered a Nexus Travelshop, bought a ticket and, instead of receiving a piece of paper and a photo card, they were asked for their Pop Card which was uploaded with their electronic ticket.
When asked to show their ticket by a Metro sinspector the details on their ticket can be checked by a hand-held electronic reader.
When the ticket runs out the customer can go to a station ticket machine to renew it, and in the near future do so online. More than two thirds of Metro stations are equipped with new ticket machines and 1,000 corporate customers will have Pop Cards by the end of October.
This first phase is transferring season ticket holders onto the Pop Card. The next – Touch In Day - is scheduled for about half way through 2013. On that day automatic ticket gates installed at the 13 busiest Metro stations will become active and will only be opened by a Pop Card or traditional paper ticket.
“The reasons we are introducing Touch-In Day is more than just getting people to go through barriers. The magic of that day is that we are introducing a new product which is called Pop Credits,’’ says Hughes.
Pop Credits will be a pay-as-you-go system similar to that used with the Oyster Card. The customer will put whatever sum of money they want onto their card which they will use to pay for travel as they go.
On exiting the Metro system the customer will either go through another gate or touch their card against a validator, which will allow the fare to be calculated and the relevant sum removed from the card.
It will be cheaper to travel with pay-as-you-go compared to a paper ticket. Ticket machines and a website will inform people of the balance on their Pop Card and allow them to top up.
“The real beauty of it is you can travel as much as you like on any given day and you’ll never pay more than what we call the price cap. We’ll have a daily price cap and the system, as you travel round will calculate how much you have spent and once you have hit this price cap it will stop taking money off your card and the rest of your journeys will be free.’’
The price cap will be set at the level of the most expensive Metro day ticket, currently £5, but the Integrated Transport Authority, which sets ticket prices as a public body, is also expected to introduce a discount for Pop Credits compared to buying paper tickets.
Pop Credits will also be available for use on the bus system. Agreement has been reached through a parallel project called Nesti, North East Smart Ticketing Initiative.
Nesti is a collaboration between the North East’s 12 local authorities, each of which has contributed to a £10m fund to develop a smart ticketing network that covers the region from Saltburn to the Scottish border and from Hartlepool to Hexham. The objective to ensure that smart payment is available whatever public transport you choose to use, as well as in other public services.
Under the Nesti agreement the Pop Credits will be acceptable on buses from Touch-In Day. The daily price cap will, however, only apply to Metro travel. Also through Nesti there will be a retail network where people can top up their Pop Credits close to home.
“I can’t at this point say who the supplier is because we are going through the procurement process but we have got a preferred supplier and it’s somebody who works with small shops and local suppliers.’’
Nexus is eager to work with as many companies and public bodies as possible to ensure smart ticketing is fully integrated with customers’ everyday needs and activities.
It is, for example, working closely with Newcastle University through the Nesti project to allow students to use the same smart card to access university buildings as well as to travel on the Metro.
Similarly, sixth formers in Gateshead have begun using Pop Cards to access school facilities and register attendance, as well as travel to school by bus.
“These are examples of what could, over time, become lots wider uses. You can see council leisure centres being part of this and library systems. You can see sports clubs wanting to combine travel tickets with access systems or loyalty cards. The possibilities are endless as we map out that development.’’
Nexus believes the Pop Card has much to offer employers. “The benefit to the employer is that many have an obligation to make sure their staff can get to work as sustainably as possible, either because they are in areas with constrained parking space or because they are in organisations where perhaps there is a group of staff with low car ownership or because they have adopted sustainable travel policies.
"Public transport is also the key to a flexible workforce and recruiting as widely as possible’’ Some big employers – public as well as private – already run schemes whereby they buy annual tickets from Nexus for their staff and recover the cost through monthly payroll deductions.
“Part of our role is to help grow the economy and get as many people into jobs as possible. So we will do anything we can do in terms of developing the accessibility of public transport through ticketing and through understanding customers’ needs so we can connect people with jobs and employers with workforce.’’
The benefit of the new system for customers is that they will have new ways to pay for their travel, new outlets at which they can pay and a cheaper fare. They will also have greater security, in that a lost or stolen card can be blocked and replaced.
“They will also get a heap of extra improvements as time goes on: new ways to monitor their travel and usage of public transport and how it affects their finances; ways to buy tickets to download onto their smart card at home.
"We will also be developing a system of incentives for loyalty and frequent use of the system.’’ Nexus has three aims in introducing the Pop Card. It wants to increase use of the Metro by making the systems as convenient as possible; it wants to maximise its revenues and minimise public subsidy; and it wants to transform the customers’ experience to achieve the first two aims.
“The possibilities of completely different ways to pay are there and we will continue to look at them but we’ve also got to ensure that customers continue to use the system in a way they feel comfortable with.
“At the moment it’s a question of expanding our product range to make it easier while at the same time giving the discounts for long term season ticket holders that are already there.’’
Nexus’ business case for the new system is based on a reduction in ticketless travel. Each passenger without a ticket costs the business at least the price of a single fair and – while such fraud is relatively rare – it is still estimated to account for several hundred thousand journeys each year.
Converting a reasonable percentage of those to ticket sales will produce an overall revenue gain. Nexus believes the Pop Card will appeal to a new market segment – people who would otherwise travel occasionally but feel it’s too expensive or inconvenient to buy a ticket and use their cars.
“Our aim is to capture that market by saying you have got the card in your pocket, you’ve already got money on it, if the decision today was between driving and getting Metro, it’s actually as easy to get Metro because you haven’t got the worry about change, you haven’t got to worry about where you get your ticket, it’s already there.’’
Further benefit for Nexus is having less cash to handle and more and better information on where and how the system is being used allowing better planning of services. It will also free personnel to increase staff presence elsewhere on the network. Will the system be future-proof and able to cope with future developments such as paying by smart phone.
“It is. The key thing is moving from paperbased system to an electronic based system. Once the information about ticketing is held in a central electronic place you can then move with the technology. You are quite right, the next step is highly likely to be mobile phones.
“The plastic credit card sized card isn’t the important bit. “The important bit is the chip with a little aerial which emits a signal which is read by the device in the Metro station. You can do that with a wrist band, with a mobile phone, with a key fob and any number of different devices. As we move further into the future the ways to pay will change as well.’’
The introduction of the new system is not happening in isolation, but has gone hand-in-hand with Metro: All Change, a £385m programme of capital investment in the system. Hughes says: “These are clearly challenging times for the local economy in Tyne and Wear, these are tough times for employers but they are also tough times for their staff.
“It’s really important that the public transport system is there to support them and make sure that people can travel around accessing employment and opportunities to engage in economic activity during this period.
“On Metro we have seen the effects of the local economic challenges, we have seen some declines in ridership during off-peak periods when people would engage in leisure activities but we are pleased to see that at the moment the peak travel appears to be holding up fairly well.
"That said, across public transport as a whole there are declines in ridership which we think are related to the local economy. It’s very important that public transport providers and businesses continue to work closely together to make sure the system is there to support economic growth.’’