§ The Earl of Clancarty
asked Her Majesty's Government:
How much money London Underground has lost through fare evasion per annum from 1988–89 to the present; how these figures are calculated; and how these figures are substantiated. [HL2431]
§ Lord Whitty
LT's estimate of the net revenue loss through passengers travelling irregularly is as follows:
£ million 1988–89 39 1989–90 40 1990–91 *17 1991–92 16 1992–93 17 1993–94 18 1994–95 **11 1995–96 13 1996–97 18 1997–98 21 1998–99 25 Total 235 * ticket operated gates were introduced in the central are during 1990. ** penalty fares were introduced during 1994.
These figures are derived from quarterly surveys of approximately 40,000 passengers, carried out by plain clothes revenue control inspectors on board trains. These surveys establish the proportion of Underground passengers travelling irregularly (although not necessarily fraudulently in the legal sense). That percentage is then grossed up proportionately to total Underground patronage to determine the full potential revenue loss at average fare rates.
The resulting estimates have been validated successfully against the direct effect on revenue when station control exercises are held. These are when teams of London Underground Revenue Control Inspectors prevent entry to or exit from a station or group of stations without a valid ticket. The figures are also validated against econometric analysis of LUL receipts against a number of possible explanatory factors, including the installation of automatic ticket gates and penalty fare changes.