(Bexhill and Battle)
(Con)
I beg to move,
That leave be given to bring in a Bill to make provision for
passengers to receive automatic compensation from travel
operators in certain circumstances; to require train
operators to ring-fence certain funds received from Network
Rail for service disruption and planned possessions for the
development of ticketing technology to facilitate the payment
of automatic compensation for passengers; and for connected
purposes.
In short, my Bill would ensure that passengers on trains,
flights and other domestic transport systems automatically
received in their bank account the delay repay compensation
due to them without first having to work out their rights or
apply for it. The mechanism for claiming refunds for delays
and cancellations is complex and cumbersome. As we found with
Ryanair, the rules are not always explained correctly—or
explained at all—to passengers. This comes at a time when
innovation in technology should be lessening the need for
passenger administration and red tape. Let me use rail and
flights as examples, although this Bill would also apply to
trams, ferries and other paid modes of transport.
Let me first turn to rail, in which I declare my current
interest as a 12-year veteran of the daily commute from East
Sussex to London. Nearly 67 million rail journeys last year
were either cancelled or were significantly late. These
delays can lead to lost output, financial hardship and
stress. Passengers expect adequate compensation for these
difficulties. To implement this fully would incentivise the
train operators and Network Rail to do more to prevent these
issues from occurring in the first place. This would, in
turn, increase our nation’s productivity.
A number of steps have been taken in the past year, including
the strengthening of the Consumer Rights Act 2015 and the
introduction of Delay Repay 15 for Southern and new
franchises, but only a third of rail passengers who are owed
compensation make a claim. Network Rail currently makes
payments to train operators for all the delays that it has
caused through track and infrastructure failures. However, if
only a third of the passengers who experience the delay claim
for it, the remainder must be retained by the train
operators. My Bill would require the train operators to
ring-fence this excess so that it could be used only to
advance technology that would allow every passenger to touch
on, and off, their train. Having pre-registered account
details, the passenger would automatically receive
compensation in their bank account on the day they were
inconvenienced.
None of this should be particularly complicated. Six of the
27 train operators have some form of automatic compensation
for certain passengers. Among the six, I understand that
Virgin Trains West Coast offers it to passengers who book
directly, and that Govia Thameslink, via its three operators,
and c2c offer automatic compensation to season ticket
holders. Providing compensation as some sort of perk to
certain classes of ticket-holders is missing the point, and
distorts competition in the ticket-buying market. Every
passenger is entitled to compensation. If the technology
exists, it must be applied to all. Where compensation is not
going to the passenger, the taxpayer-funded compensation
coming from Network Rail must be used by all train operators
to get us to a place where compensation is automatically
delivered to every passenger so entitled.
Let me now turn to flights. The situation is arguably worse
with airlines, as the recent debacle at Ryanair demonstrated,
with 2,100 flights being cancelled and 315,000 passengers of
Ryanair being left completely out of pocket. However, the
company’s website failed to mention the word “compensation”,
stating only that it would comply with EU regulation
261/2004. Unless passengers happen to be experts in EU
regulations, they will not realise that this rule-set
provides compensation and assistance to passengers in the
event of denied boarding, cancellation, delays and
downgrading when flying. The Civil Aviation Authority had to
threaten enforcement proceedings before Ryanair informed its
customers of their compensation rights.
This is not new ground for the CAA. In the last six years, it
has successfully taken action against a number of airlines,
including Ryanair, for a range of issues including
non-payment of compensation and providing limited information
to passengers. All of this can be avoided. It must be
possible to put the onus on the airline to calculate
compensation and credit it automatically. For security
reasons, every airline must know which flight a passenger is
booked on, and know whether that flight has been delayed or
cancelled. They also know a passenger’s account details, or
can find them via the flight booking agency.
I put this contention to the chief executive of British
Airways when he appeared before the Transport Committee last
month, and asked him why automatic compensation could not be
brought into his industry. His response was to state that
“we will pass that cost on to the consumer, like we always
do. We do not operate as a charity.”
That defensive response was revealing. For there to be a cost
to pass on suggests that many passengers are not claiming for
delays or cancellation because they do not know their rights
or find it too cumbersome to claim. We simply do not know the
position, unlike in the rail industry. From what the chief
executive of British Airways said, it seems that we are
unlikely to find out without a change in approach or
legislation. When I asked him what proportion of passengers
claimed and were paid compensation, he remarked:
“I am not prepared to disclose that. That is commercially
sensitive”.
Despite my asking him repeatedly why an answer would give his
rivals the upper hand, no additional information was
forthcoming.
The previous week, the Transport Committee had heard from the
Secretary of State for Transport—who, I should add, does an
excellent job, and I hope that the adoption of this Bill by
the Government will further his ascent to the skies. I asked
the Secretary of State for his views on automatic
compensation. He took the view that:
“This is not a one-size-fits-all industry. It is a big step
for Government to intervene to try to tell businesses how to
operate. If there is an absolutely compelling reason to do
so, Government act sometimes”.
That, to me, summarises the situation, and it provides the
justification for the Bill.
The airline industry has to adopt a one-size-fits-all
approach from rules driven by UK Border Force, the Civil
Aviation Authority, NATS, the European Union and other
agencies and regulators. I believe that the airline industry
can take this additional step, and I believe that train
operators and those running our ferries, trams, buses and
other modes of transport could do likewise. The compelling
reason for Parliament, and the Government, to do so is that
millions of passengers not only are being inconvenienced by
delays, but are not being compensated. It is time for those
responsible for the passenger to give something back without
further work for the passenger.
I thank the 50 right hon. and hon. Members—many of them are
here this afternoon—who have pledged their support for this
proposal. It follows the murmur of approval across the House
when I asked the Prime Minister to support this change during
Prime Minister’s questions. There are many things that the
arithmetic of this place will not allow us to deliver. This
is one such change where the consumer will benefit from our
working together, cross-party in Parliament, to cause the
industry to change its approach.
Question put and agreed to.
Ordered,
That , , , , Sir , , , , , , and present the Bill.
accordingly presented the
Bill.
Bill read the First time; to be read a Second time on Friday
16 March 2018, and to be printed (Bill 129).
