Lord Moylan (Con)

My Lords, I rise to speak to my Amendments 71 and 72 in this group, with a slightly different angle on this interesting topic of payment, which has been raised by my noble friend Lord Effingham. Normally, I like to give the Government a good roasting, criticise them and explain why it is that I am so much further ahead in my ideas than they are. On this occasion, since I have tabled these amendments and made further inquiries, I am glad to say that this will be an easy ride for the Government because they are doing quite a lot on this already and things are going generally in the right direction. My first amendment relates to the payment by concessionary fare holders, and the second relates to contactless payment. The two may seem to be roughly the same, but they are very distinct. Contactless payment using a bank card, debit card or credit card cannot be used by those who have concessionary rights to travel on the buses because, obviously, if you are going to use a card, that right has to be evidenced by some identifier. Let me give an example: those who have a national bus pass will have a photo card of a distinctive style, with an English rose on it; I remember that that was an important feature when it was designed. It is a card of a distinctive style with your face on it, and you need it in order to demonstrate your right both to the bus driver, who probably takes no notice of what is on the card, and, certainly, to a revenue protection officer were they to board the bus and check. This cannot be done with a bank card. One therefore needs two types of technology involved, which I want to deal with separately. In London, the system that was developed for concessionary fare holders was originally the system used for all contactless payment. This was the Oyster card technology, which is still used for concessionary card holders. That includes not just the elderly—the national bus pass people—but also those with freedom passes and young people who have free travel as well. That technology is used. However, when the national bus pass was introduced—by Gordon Brown’s Government, as I recall—that technology was not used and the DfT preferred its own technology, which goes under the name of ITSO. TfL regarded it as rather clunky, but the fact is that TfL then had to fit all of its bus card readers with equipment that could read two separate technologies in order to read what is going on. This was a very foolish way of going about things. The purpose of Amendment 71 is to suggest that, as this matter develops, there should be a single system that is applicable to concessionary card holders. Amendment 72 relates to contactless payment. Contactless payment is widely used in London and was promoted by TfL in collaboration with the banks. In fact, it is quite likely that the banks would never have taken the risk of introducing contactless payment into the country if it had not been for TfL turning up and saying, “We have 4 million transactions a day; if we were to get together, maybe we could make contactless work. It will de-risk it for the banks, to some extent, and will give us something even cheaper than the Oyster card system”. I mentioned it being cheaper. We should bear in mind that the driver of this, from the bus operators’ perspective, is the cost of collection. The point I would make—I would never disagree with what my noble friend Lord Effingham says—is that inclusion is very important, but one has to remember that cash is expensive to collect. It is much less for electronic payments. Of course, you have to pay the banks, but TfL was quite lucky because it had a proposition for the banks, which meant, I think, that it could negotiate a very good deal with them in terms of what it paid per transaction. Certainly, it is much less than the cost of cash collection, or even of Oyster card operation. If you are an ordinary passenger on TfL services nowadays—not a concessionary fare holder—you must notice that all the advertising encourages you to use contactless and not to get an Oyster card at all. That is the direction in which everything is going. Outside London, however, contactless payment is still rare. The reasons for this are partly that the different bus companies all have different back offices, and the system needs to work in such a way that it will work with all the different back offices. I am perhaps pre-empting what the Minister will say, but I am delighted to be able to say that I have had some very interesting and valuable conversations with Midlands Connect, which is the non-statutory transport body for the West Midlands and the east Midlands. On behalf of the Government, it is carrying out work to develop a system that would work with all the different back offices of the various different bus companies so that it is possible that, over time, we could have contactless payment on buses throughout the rest of the country. That would be very welcome. It would be useful if the Minister could say in his reply what the timetable for that is; how much resource the Government are putting into it; what level of priority they regard it as having; and how they will now work with the multiple LTAs up and down the country, which will be running the buses, to make sure that this is adopted in a coherent way.