This is Money Blog

We have the rail system that we deserve

As a nation of whingeing motorists the British public has no right to lament the latest twist in the debacle that is the UK rail system.

For decades the great British motorist has made it perfectly clear where his priorities lie: with driving his own little car – usually on his own and not so little – exactly wherever and whenever he likes. He wants more roads and cheaper petrol and lower road tax.

Each hint that the motorist should pay more and the selfishness turns to anger – either at the pumps or at new road tax measures or at traffic wardens or at speeding cameras.

'I wouldn’t mind,' the put-upon sigh goes up, 'if the revenues went towards better roads.'

Motorists pay a fraction of the real social and economic cost of driving. No other private pursuit is subsidised in quite the same way; no other luxury has come to be treated as a necessity with such a disastrous outcome for the standard of living in this country.

'But it IS a necessity for most of us,' the angry cry goes up. 'Public transport doesn't exist where I live. It's so bad and expensive it forces us into cars.'

Well that might well be the case on a day-to-day basis - but it is not a carte blanche out of individual responsibility.

Where was your anger over rail privatisation? Where was your anger over successive train fare increases? Where was your anger over station closures and poor service and management bonuses and rail disasters that cost dozens of lives?

Compared to the regular uproar over the poor old driver being hit in the pocket again, I seem to remember an overwhelming indifference. If you’ve ever complained about rising road tax or petrol tax or parking fines or speeding fines – then you are part of the collective attitude that has ushered transport in this country into the dark ages.

Public transport is in the state it’s in because as a nation obsessed with the motor car, we have gladly allowed it to become so. 

Those staring forward bright-eyed from motoring’s golden age of the 1950s and 1960s might not have been able to foresee the dysfunctional and I would argue dystopian outcome that the switch from train and bus to car would bring about.

But it's been the elephant in the room since the mid-1980s and we have stood around doing precisely nothing about it. And we haven’t even started paying for it.

- Adrian Lowery, Assistant editor, This is Money

Right, that's it, I'm packing my bags!

Supermarkets like constantly to remind us how they are focused on customer service – or even better, improving the customer experience. Great, you might think, how could that be a bad thing? Here’s how: checkout staff filling your bags for you.

Over the last year or so, I notice, the staff at the sort of tills where they stand up – the majority it seems in London - are as a matter of course putting your groceries into bags for you.

My response when it’s my turn is to say ‘I can do that thanks’ and take the bag and do it myself. Because I can pack my own bags and it makes things quicker: the till person only has to scan the stuff rather than fiddle around with bags, arranging the stuff inside them etc.

But by the time it’s my turn, I’ve stood in the queue watching all the people ahead of me standing there with their (fully functioning) arms folded, while their bags are being packed half as fast as mine will be. Forcing me to stand in this strip-lit depot of overpackaged rubbish minutes longer than I have to.

It’s tempting to lean forward and say, ‘Excuse me, you do know it’s a lot quicker all round if you pack your own bag?’ But really this is the supermarkets’ fault. One of them started it at some point last year and the rest have followed like sheep.

I questioned the manager at my local store and she said, ’It’s company policy now sir, all part of improving customer service.’ In the same way that Soviet five-year plans improved agricultural output? I’m tempted to respond. But I fear it may go unappreciated.

I'm afraid the senior management goons at UK PLC are confusing ‘customer service’ with ‘employee servility’. In the States, whence the goons have doubtless picked up this bag-packing idea, they employ other staff to do it: while I still don't see the point, at least it doesn't slow things down.

Having plenty of tills open, having people around the store to ask things of, and supplying decent produce at decent prices – that’s customer service, stupid.

- Adrian Lowery, This is Money

Great train ticket 'robbery' gets worse

You might not think it possible, but National Express, Virgin Trains and their fellow train operating monopolies are plumbing new depths in their quest to wring every last penny from rail travellers.

One new profiteering con was announced this week by National Express: the East Coast franchise holder will now charge 'customers' £5 to reserve a seat, on top of the astronomical fares they charge for most seats on most journeys.

This was described by one union as 'mugging' passengers: but muggers are engaged in a more honest enterprise. They don't for instance offer up excuses like this:

We want to improve the on-board environment for our customers. We do find that people are often reserving multiple seats as they're not sure which train they are going to catch. Whilst we understand this, by asking people to pay for a seat reservation, seats will no longer be left empty with a reserved sign, therefore being made available for other customers to use.

That leaves me speechless. So I shall leave other rail travellers to decide whether it's shamelessly dishonest or just a bit of surrealist comedy.

The second profiteering con might have been running for some while, but I discovered it only this week, when I tried to cancel a ticket booking with Virgin Trains.

This was not one of those wonderful, cheap advance tickets. The ones we all keep hearing about when train companies try to excuse their horrendous fare increases. The ones which actually do not exist any more, advance ticket prices having rocketed in the last year. The ones where you lose ALL your money if you want to cancel.

It was an off-peak return - the sort you can buy on the day, the substantially more expensive successor to the old 'saver return'. In other words, I had nothing to gain from booking in advance except a seat reservation.

But I did have something to lose: Virgin will pocket £10 if I cancel.

Their mealy-mouthed press office maintains that other train companies levy a similar charge and that it covers 'administrative costs'. When asked to describe what administrative costs Virgin had undergone while I went on to the internet and booked a ticket, the PR person resorted to repeating the words 'administrative costs'.

Showing the same sort of contempt for logic as train operating companies have shown for passengers over many long years.

- Adrian Lowery, Assistant editor, This is Money

The cat sat on the FT

I've always been sceptical that there is any point taking any notice of share-tippers or stock-pickers. They might be able to pick winners in a booming market - but then so can anyone. When the cat's among the pigeons though, you may as well stick a pin in the paper - or a cat.

Six months ago, in the aftermath of the stock market crash, our colleagues at the Evening Standard launched an experiment to see what would be the most gainful home for your hard-earned cash: beneath the mattress, a 6.8% savings bond, shares picked by them, shares picked by a stockbroker, or shares picked by the office cat.

The cat has emerged victorious.

Its feline nose for fundamental values chose a portfolio that has seen a 14.1% gain: Jeremy Batstone-Carr of Charles Stanley managed growth of 6.4%, which isn't bad considering the FTSE 100 dropped 6.3%.

Mr Batstone-Carr, however, took it all in good humour, and the chaps at the Standard let him keep both his surnames - as you can read in Simon English's column here.

- Adrian Lowery, Assistant editor, This is Money

Stick to your strengths, YHA - like free tea

We all have an attack of the 'things aren't what they used to be!’s now and again - every time we pay for a train ticket for example.

I had a dose recently during a walking trip to the Lakes, when as usual I stayed a couple of nights at youth hostels. It is in general a fine institution the Youth Hostel Association, with a proud history of providing cheap shelter to walkers of all ages and hard-up students.

Many of them are housed in grand buildings (country mansions, former hunting lodges and the like) and – most importantly for many walkers – provide access to remote locations without being forced to camp. The staff are invariably dedicated, enthusiastic and helpful, and many of the changes the YHA has made over the years are unanimously welcome: bedding and towels are now provided and packed lunches offered.

But the YHA over the last ten years or so has evidently decided it must appeal to a new market, a phrase that should send a shiver of trepidation through any well-balanced soul. This new audience I can only assume is a more upwardly mobile sort of family who go to Starbucks a lot and expect things to be a certain way …

You can now have three-course evening meals with wine and the full range of coffee variants. But the YHA is overstretching itself with haute cuisine I’m afraid. Likewise, it seems to think everyone wants a cooked breakfast and therefore throws its efforts into serving up a poor canteen version of one, rather than concentrating on making porridge that doesn’t taste like wallpaper paste and toast that's toasted. The advice 'Keep it simple' has never been more required.

YHA has evidently decided it needs to compete more vigorously with B&Bs and inns and low-end hotels: one result of which, the cynic might chip in, is prices almost to match. Rates at YHAs now range from something like £16 to £23 a night. I had a room to myself in a Keswick B&B for £27 during the same trip. With my own bathroom and minus the full orchestral range of snoring.

But I don't begrudge YHA that – I'm still a member and willing to lend it my support. What I do regret is a gentle erosion of the things that used to make it unique.

All any walker wants coming in cold and wet off the fells is a cup of tea. Well aware of this, YHAs used to have a hot water urn and tea and coffee stuff on the side, and often some cake or biscuits, sometimes with some sort of honesty box system. Long-distance walkers don't lug milk, teabags and sugar across the fells after all, it's the people who arrive in cars that bring supplies.

Now, if the 'café' happens to be open when you stumble in sopping wet, the staff are visibly embarrassed as they ask you £1.70 for a pot of tea. One was so embarrassed that she offered to make me a smaller pot for a quid.

When was it decided that cups of tea should be priced at the same level as double mocha lattes? Coffee - the raw product - is more expensive than tea. It now also seems to require expensive machinery to brew, trained 'baristas', and several minutes of messing around. So fine, charge £2.50. But do not, please, charge me anything like that for popping a teabag in some hot water.

At the B&B, my tea was free …

- Adrian Lowery, This is Money

Let's take a lesson from our big Swiss brothers

Returning from Switzerland recently, I was suddenly struck by a surprise: Geneva airport was a bit of a shambles.

I say a bit, because it worked well enough, despite the pokey no-man's land after passport control where hundreds mill, waiting for their gate number before they can progress through security straight to an equally pokey gate lounge. I never thought I'd actually mourn the absence of a departure lounge.

The surprise was that it was the first public space or amenity or service I'd seen in a week travelling around Switzerland that didn't exude the whiff of quality, efficiency and thoughtfulness.

In a mirror image, a week previously, I flew out through Terminal 5. The space was bright and airy, and passage through the pre-flight obstacle course was smooth, rapid and, while hardly civilised, at least palatable. 'But hang on,' I thought, 'this is Britain - what happened to the T5 nightmare, to the depressingly predictable failure of major infrastructural projects?'

As I wandered through the glitzy departure lounge, past Bulgari and Gucci and Harrods (who are these people who spend thousands of pounds in the forty minutes it takes for their gate to be called? Try getting a decent sandwich to take on the plane though ...), it became clear.

The key to T5's conception also exposes the fundamental weakness in the Anglo-US approach to infrastructure funding: very little will get built unless private enterprise can make money out of it.

Which is stupid enough, but not catastrophic until you apply it to the basic requirements of a civilised society like domestic public transport.

Who cares if T5 is a shopping mall with a runway on the side, as long as it works? Who cares if Wembley relies for income on corporate hospitality and conferences and the like? If Olympics 2012 is covered in a miasma of corporate sponsorship? Who cares if getting around our own country has been rendered a deeply unpleasant and difficult task because you can't fit a Harvey Nichols on a train? Oh, er ...

The more I see of the world, the more it's my belief that you can judge the standard of a country's civilisation by its public transport - which puts us well below India, a country to whom we bequeathed a rail system that we then dismantled within our own shores.

The Swiss rail system is stupendous, it's everything you'd expect from the cliche of Swissness. Why we Brits seem to regard quality, efficiency and punctuality (i.e., near-perfection) with such suspicion, I'm not quite sure. Presumably, everyone here is much happier with our tinpot rail franchises who charge £120 walk-on fares for you to stand in a vestibule that smells of excrement?

By any measure, our transport policy of the last four decades has been a failure of catastrophic proportions. Our moronic commitment to road travel and freight and a base capitulation to the motor lobby and private-sector involvement has left us with both roads and trains that are chronically overcrowded and prohibitively expensive. It's left our cities filthy, noisy and gridlocked and our populace more knowledgeable of European capitals than their own country.

Isn't it about time the UK went for quality rather than expedience? Isn't it about time we stopped scuffing along pathetically in the gutter beside the US with the 'get it done on the cheap and fleece the user at point-of-sale' philosophy and joined our grown-up cousins across the Channel. Who realised some time ago that if you invest money in public transport with enough thought and clarity of purpose, it will significantly improve the quality of life across the whole nation and through generations.

The Olympics might be all very jolly, but you can't get to work on them.

- Adrian Lowery, Assistant Editor, This is Money

Record month for This is Money: Top 20 stories

This is Money recorded monumental all-time highs for traffic in October: 1.66 million visitors read a total of 14.17 million pages.

Those totals are 23% and 43% higher respectively than the previous record-holder, the preceding month of September. And they are double those we saw in October 2007, which in the wake of the Northern Rock crisis was not a quiet month.

This is perhaps not surprising, given what an astounding month October 2008 was. In the opening week, the world financial system wandered up to the abyss, took a good peek over the edge and, in response to some heavy prompting and prodding, spent the rest of the month back-pedalling to what seems like relative stability. No such dramatic fix for the UK economy - the bad news on which kept coming thick and fast.

But it was our extensive coverage of the Icesave issue and the crisis in UK banking that kept people clicking throughout the ensuing weeks. We like to think that with our guides to the safety and strength of banks, and to safeguarding your savings, we produced exactly what people wanted.

The figures certainly suggest so.

1. Your guide to banks' safety and strength.
HBOS | Lloyds TSB | RBS-Natwest | Barclays | HSBC | Abbey | A&L | ING Direct | ICICI
2. How to save safely with UK banks and building societies.
3. Savings compensation: Bank ownership.
4. Interest rates: News and predictions.
5. Latest oil price and historic charts.
6. What now for Icesave savers?
7. 300,000 UK savers face claims for Icesave cash
8. Volvo truck sales plunge 99.7%
9. Easy steps to getting the best Isa
10. Could Kaupthing Edge be the next Rock?
11. How would I make an Icesave claim?
12. ING buys up bust Kaupthing's UK savings
13. Iceland's banks top 'riskiness league'
14. Buy-to-let gurus sell after doing the maths
15. House price falls outstrip 1990s crash
16. Darling guarantees Icesave savers 100%
17. Has your mortgage rate been cut?
18. How safe is your building society?
19. The stock market slump of 2008
20. Will UK interest rates fall to 0%?

- Adrian Lowery, Assistant editor, This is Money

Web week: Scorn over mortgage bail-outs

To what extent should people who find themselves financially stricken receive help from the state? This question has been central to centuries of political and economic debate, and that debate was still raging this week as the top story on thisisismoney.co.uk provoked a heated response.

A report broke on Friday alleging that Gordon Brown's housing market rescue plan would include measures allowing councils to buy repossessed and unsold properties to help people stay in their own homes.

Readers dashed to comment on the story, with the majority furious that people who had overborrowed, or neglected their mortgage in favour of other spending, would be baled out by the more prudent.

'Governments should intervene only in cases of market failure - and the fall in house prices is not market failure' suggested one.

When the plan was revealed earlier this week, with that element all but absent, most scorn was heaped on the headline stamp duty holiday. Most argued that this can only prolong the agony: first-timers encouraged to buy will find themselves in negative equity once the holiday's over and the market resumes its nosedive.

The laissez-faire side of the old debate won out: 'Painful as it sounds, the economic situation must be left to correct itself.'

The most read articles on thisismoney:

1. Crisis plan for property as crash feared
2. Stamp duty holiday for homes up to £175k
3. Bank stocks: Facing a wipeout?
4. Stamp duty: Don't bank on house price rise
5. Halifax reveals worst ever house price falls
6. Oil 25% cheaper, so why is petrol so dear?
7. Worst house prices fall for 18 years
8. Foreign blow to £1bn fuel aid for the poor
9. Rate cut in doubt as food prices jump 10%
10. Beat the credit crunch: Boost your income

Nightmare on Fleet Street

In a week when we were warned the UK was heading into 'an economic horror movie', I got to pondering, are things really that bad?

I would question for instance that we are about to be plunged into a nightmare zone where Freddie Kruger forces us to hand over our pocket money, or worse, wake up on a Greek island inhabited by the cast of Mamma Mia who sing at us until we give them our houses.

There's been lots of comparisons crowbarred by pundits between the present and the 1970s, what with soaring oil prices and the prospect of stagflation - Life on Mars has a lot to answer for.

The media (and obviously I cannot except us from that constituency) are falling over each other to forecast a fiscal Apocalypse Now. Readers, one imagines, sit shaven-headed in a jungle of existential angst murmuring 'the horror, the horror' at their wallets ...

Note how it's the predictions that are always dire - because frankly the reality rarely is, and particularly not now. Apart from the poor and the humbly retired, who can't really afford for things to get worse, I don't accept that anyone is 'suffering' from the credit crunch.

The mortgage might have gone up a bit, as has petrol and food – but really, who is seriously going without as a result? I'd say a more accurate assessment for most households is 'slightly less comfortable than a year ago'. So, we are entering an 'economic mild peril movie' - but that's not good box office is it?

I prescribe focusing on more uplifting matters over a good meal out – I'm convinced restaurant prices haven't kept up with those in the shops. More of an 'economic sod it movie'. If you can't afford that, a pint of beer in the sunshine is just as nourishing for the soul. Just don't take the newspaper.

More: Is Britain really turning into a Dystopian horror movie?

Most-read stories this week on This is Money

10 most-read stories of the week
(Number of reader comments as of 13.00pm on 02/05)

1. Buy-to-let giant Inside Track goes bust (53)
2. Bank bail-outs to be kept secret (44)
3. House prices now lower than a year ago (53)
4. Is buy-to-let on the brink of collapse? (42)
5. Midas: should you buy in RBS cash call? (5)
6. Mortgages 'to rise by £230 a month' (25)
7. Opec: Petrol to hit £1.50 a litre this year (41)
8. Earn instant interest on new e-bond (3)
9. Abbey's 'bargain' holiday credit card offer (2)
10. Thousands face a £245 road tax rise (13)

Two issues dominated the attention of our readers this week. News on Wednesday that property investment firm Inside Track had gone under drew enormous numbers.

This cheerleader of the buy-to-let boom had made its money running seminars that promised massive returns to punters prepared to buy up strings of urban new-build flats, often well before completion.

Reality often failed to fulfil the promise, and This is Money and Financial Mail have a proud record over the years of warning would-be investors against swallowing the hard-sell of firms like Inside Track - and of airing the stories of individuals who have been scuppered by rental returns and flat valuations well below billing.

Some of our readers' 53 comments, however, expressed little sympathy with those who fell foul of Inside Track's lure. Some also questioned the ethics of buy-to-let landlordism, and others asked if the market had collapsed - our buy-to-let market analysis article was another hit.

Close on the rails was last week's Financial Mail front-page revelation that the Bank of England will not be disclosing which banks dip into its £50bn credit crunch finance. This ran all week and amassed 44 comments, largely disparaging of a perceived arrogance in the Old Lady's handling of taxpayers' money.

This reflects a year-long burgeoning of interest not only in the credit crunch, particularly as it starts to affect households directly, but also in the condition of our big banks' finances, and whether bail-outs are justified.

- Adrian Lowery, Assistant editor