Passenger shortage set to hammer Network Rail finances
The UK’s railways are facing a drop in usage that could see up to 2m passengers fewer use trains every day as working patterns shift due to Covid-19.
According to a worst-case estimate prepared for rail authorities, passenger numbers may be no higher than 60 per cent of pre-Covid levels for the next four years.
The estimates, reported by the Telegraph, come as businesses mull changing their working practices to allow people to work from home more.
Banks such as HSBC and JP Morgan have already indicated that they are shifting to a more flexible model of work which could make the daily commute a thing of the past for many workers.
But for the country’s railways, which carried 5m people a day prior to the pandemic, the consequences could financially devastating.
The Telegraph reported that a drop to 60 per cent of pre-Covid levels could blow a £4bn hole in National Rail’s annual revenue from fares.
Even in the best case scenario, which envisages passenger numbers to fall by 10 per cent, National Rail would still find itself £1bn short a year.
A source said: “You could be talking about a £1bn gap or you could be talking about a £3bn-£4bn gap every year. That’s the challenge at the moment … a significant minority or possibly a majority of people, the classic office workers, simply will not be going back five days a week.”
As of last week, rail passenger numbers, which dropped as much as 95 per cent during last year’s first lockdown, were at 38 per cent of pre-pandemic levels. That is the highest they have been since September.
As a result of the fall in passenger numbers, the government has placed all rail franchises under emergency agreements in order to allow them to continue running essential services.
Over £4bn in taxpayer money has already been spent on keeping trains running, a figure that could rise as high as £9bn.
In November, rail bosses said that they were hoping that passenger numbers would get back to 75 per cent when the Covid crisis ends.