The Department for Transport is providing £20m in funding over the next five years to enable nine of England's largest urban areas to make the switch to NFC-compatible transport ticketing systems.
Within the next five years passengers on public transport in England's major urban areas will be able to travel without a paper ticket, transport secretary Andrew Adonis has announced.
England's nine largest urban areas are to receive £20m over the next five years from the Department for Transport in order to introduce NFC-compatible ticketing systems and all of the UK will be helped to switch to the new system by 2020. Each area will be required to submit spending plans for the funding in early 2010, which will need to be approved by the Department before funding is paid out.
To motivate bus operators, the Government has also announced an 8% increase in the Bus Service Operator Grant (BSOG) for those that install the new ticketing technology on their buses. Together with a second grant for bus operators who install GPS technology, the funding is worth around £1,000 per bus each year.
"Smart tickets — a system where a ticket is stored on a microchip, on a smartcard (like Oyster) or even on a phone or bank card — can give improved journey times and faster, hassle-free purchasing and use of tickets, with associated benefits for local government and operators," says the Department for Transport. "The Government estimates that the benefits of 'integrated smart' ticketing, that allows travel across operators and across modes, could be worth over £1bn per year."
The £20m smart ticketing fund will be available in the nine largest urban areas in England outside London — Greater Manchester, the West Midlands, Tyne and Wear, Merseyside, South Yorkshire, West Yorkshire, Nottingham, Leicester and Bristol. The funding will go towards implementing ticketing schemes that adhere to the UK's national ITSO standard, which is compatible with NFC and is also being implemented by British rail operators.
The key benefits of this approach, says the Department for Transport, are:
- Allowing passengers to load tickets or credit in advance of travel, speeding up boarding times and reducing queuing.
- Fraud and security — smart tickets are far harder to replicate and can be electronically 'killed' the moment they are reported lost or stolen, with any remaining balance refunded
- Sophisticated rules can be applied to 'cap' an individual's cost of travelling at a certain level so that they will always pay the best ticket price possible for the journeys they actually make.
- Operators will be able to run their own loyalty schemes and offer ticket types to suit individual customers' needs.
- Joining up services through using smartcards for other products such as library membership, leisure centre entry, benefit entitlement, parking, bike and car hire, and even lift share arrangements.
A recent survey commissioned by the Department for Transport indicated that integrated smart tickets have the potential to attract as many as 25% of current non-public transport users onto the system and that a pre-pay smartcard with a daily cap could increase some individuals' trip rates by more than 14%.
Research commissioned by the Department also suggests that some bus 'dwell times' could reduce by 50% if there was full take-up of smart ticketing technology. In London, where the first NFC-compatible ticket barriers are to be introduced on the underground from 2011, the introduction of Oyster enabled 35 passengers per minute to go through the ticket gates compared to 15 passengers per minute previously.
"The benefits of smart ticketing to passengers are clear — quicker, easier and potentially better value journeys on trains, buses and trams, whichever company runs the service," says the transport secretary. "We could even see the death of the paper ticket as direct payment and mobile phone technology picks up pace."
"If passengers had smart tickets they'd almost certainly use public transport more," he added. "Getting this technology on-board will help reduce congestion and pollution, improve the local environment, and help us, operators and local authorities provide the 21st century public transport network that we know people want."