Being in charge of London’s transport system with its blocked roads, unreliable tubes and antiquated trains cannot be an easy task. But Jay Walder, managing director of finance and planning of Transport for London (TfL), has been around the block when it comes to transport systems.
When mayor of London Ken Livingstone brought transport commissioner Bob Kiley over from New York and heralded him as the London Underground’s last hope, few people knew that Kiley brought Walder, his trusted transport expert.
Kiley and Walder fought side-by-side to revive the once-crumbling subway in New York: Kiley as president of the New York City partnership, while Walder handled the groundwork as executive director and chief financial officer of the Metropolitan Transportation Authority (MTA). In about a decade, they turned it into a smooth-running transport system.
Walder began his transport career at MTA in 1983 as an entry-level budget analyst. Though he is responsible for TfL’s accounts, he is not an accountant, coming from a finance background rather than pure accountancy. He obtained a masters in public policy from Harvard, with a specialisation in finance.
‘The New York subway system was an international symbol of urban decay then. Graffiti was intractable, trains didn’t run, investments hadn’t been made for decades and we were virtually on the point of saying, “either we improve it or we shut it down”,’ he recalls.
The transport system was so bad that the city’s economy was suffering as a result. In the late seventies and early eighties, the economy had reached a complete low and was facing a fiscal crisis. Ten years later, MTA had invested in 2,500 new subway carriages and rebuilt 3,500 existing carriages. Every train was free of graffiti, stations were being rebuilt and New Yorkers were rating it as the public service that had improved the most over the past decade. ‘When I left in 1995, transport was discussed as being the backbone and foundation of New York’s renaissance.
‘When you can take the frustration that existed and feel you were a part in turning that around from a public service that people hated into a service meeting their needs – that’s an incredibly satisfying feeling.
I think the same opportunity exists for London,’ Walder says confidently.
Earlier this year, Walder had the unenviable duty of implementing the controversial congestion charge system. Currently, he is getting his teeth into a project to get London commuters to abandon cardboard tickets in favour of electronic ones. The new smart cards, called Oyster cards, have been unceremoniously launched in the past few weeks.
The infrastructure of card readers and electronic ticket sales software has been implemented in the past year and Underground staff have been testing the system for six months. In June, the cards were released to online buyers of season tickets and in autumn this will be extended to stations and ticket agents. At that point, the cards will also become available for non-season ticket travellers.
A quiet, phased release is exactly the way Walder likes it. ‘To do it slowly is the appropriate thing when you implement a system of this nature.
I call it a “soft launch”; it is ensuring the systems are operating properly and ensuring the demand doesn’t overwhelm the capacity. The nightmare scenario is to walk into a tube station on Monday morning and see a queue that goes out the door because there has been a software issue,’ he explains.
In the otherwise smooth rollout of the Oyster card system, software has been the only cause for delay. The system is set up to offer an automated interface between sales desks to the TfL accounting system, which involved implementing an automated ticket office system in all stations. During the test phase, the software interface wasn’t working correctly and reprogramming was needed on both the ticket office system and the accounting system.
Integrating this system into London buses has proved problematic due to the simple fact that they only have one card reader per bus. ‘If a gate is not working in an Underground station, you can move to the next gate. It has redundancy built in automatically. With buses you don’t have redundancy. Each of the 6,000 buses operated in London has its own unit,’ Walder says. He added that this too turned out to be a software problem.
But a small amount of tweaking solved the redundancy issue.
Underground staff who have been testing the cards are pleased with the results. One tube worker at Vauxhall station this week broke into a big smile when asked whether she liked the cards. ‘It has made my life easier.
You don’t have to fiddle to get the ticket into a slot of a machine – you just wave the card over the yellow circle and it works,’ she beamed.
Because it has only been a few weeks since the cards were launched, she hasn’t seen many used by passengers yet. But she is confident the scheme will take off and expects it to shorten cues at ticket barriers.
The cards further promise to calculate cheapest ticket fares for commuters by memorising past travels and combine, for instance, single tickets to ‘all-day passes’.
In addition, they increase security because they do not have to be taken out of a handbag to activate the yellow card readers, which will reduce the chance of women being targeted by pickpockets.
The Oyster cards will also help TfL tackle fare evaders. TfL estimates it currently loses between 3% and 4% of its £1.9bn ticket revenue on various types of fare evasion, which amounts to some £76m per year. When a cardboard ticket is stolen, the Underground issues a new card to the ticket holder, but the old ticket can still be used.
In the new system, the lost or stolen card can simply be switched off.
Other types of fare evasion include adults travelling on child’s tickets or travelling in too many zones. ‘The Oyster cards will help with all of these fare evasions. But tackling fare evasion is not just technology, it requires a human presence as well – we have teams of revenue inspectors,’ Walder says.
Tackling fare evasion, he believes, can have a greater impact on security than one would expect. ‘In New York there was a high correlation between people evading fares and people who were wanted for other criminal offences.
The amount of effort and time you put into fare evasion pays dividends, not just in terms of fare evasion, but in terms of the transport system’s security.
‘I believe the same is true here. It’s often called the Broken Window Philosophy – you worry about the little things because the little things lead to the bigger things.’
When Walder came to London in 2000, he knew there was a challenge waiting for him. Like in New York, he was facing a transport system that was almost grinding to a halt, while Londoners had become weary of failed promises for improvement. But the challenge is exactly why Walder wanted to come over to see whether he can turn the system around once again. ‘London has in many ways one of the most wonderful transportation systems in the world. But, it also generates more frustration among the public than any other service in London,’ he says.
Walder argues London’s transportation system is the result of a great vision – building the world’s first tube network – but it has suffered decades of underinvestment. This has led to great frustration.
‘Unfortunately, the time it takes to repair transportation infrastructures is not measured in months, or even years, but decades. This is because, for instance, with London Underground, you must be able to carry 3.5 million people a day while rebuilding that system.
London has further suffered because of a failure to invest in new infrastructure when capacity problems became apparent. The last line built was the Victoria line and that was in the sixties. We now have an opportunity with Crossrail to invest in a very critical new piece of transportation infrastructure for London,’ he says.
In the meantime, Walder simply enjoys living in the city. ‘London is one of the most wonderful cities in the world. Two weeks ago my wife and I went to the Globe theatre – we didn’t stand in the yard, we took a seat.
Yes, I’m old enough to take a seat,’ he laughs. ‘We came out at the interval and we were eating an ice cream on the banks of the Thames. On our way back, we walked over the Millennium bridge to Embankment to catch a tube.
I found myself saying: “Isn’t this just the most wonderful thing?”‘
ON THE BUSES (TUBES & TRAINS)
Jay Walder oversees 577 people in seven departments:
Stephen Critchley, chief financial officer – 75 staff.
In charge of ‘traditional finance functions’, such as business planning, management accounting and performance, accounting, treasury management, pensions, financial services, payroll and accounts payable.
Steve Allen, director of corporate finance – four staff.
Manages TfL and London Underground PPP and PFI contracts.
Charles Monheim, director of fares and ticketing – 57 staff.
In charge of fares and policy changes and responsible for the implementation of the Oyster card.
Chris Townsend, director of group marketing – 296 staff.
Oversees spend and revenue on marketing activity. Develops the transport brands and promotes changes including those on the Oyster card.
Ben Plowden, director of borough partnerships – 29 staff.
Develops and maintains the relationship with the main individuals in the London boroughs. He oversees the £150m investment budget for borough transport improvements.
Barry Broe, director of group transport planning and policy – 111 staff.
In charge of the major investment projects such as West London Trams and the Thames Gateway Bridge. He is also involved in London’s Olympic bid. Office of the MD – five staff.
His direct support group, which in turn oversees TfL’s up-and-coming major projects.
IN THE PIPELINE…
Oystercard ticketing – £1.2bn.
The project aims to replace the cardboard tickets with electronic smart cards.
Thames Gateway Bridge – £425m.
Construction of a new Thames crossing in East London.
West London Tram – £425m.
Construction of a tramline along Uxbridge Road in West London.
Cross River Tram – £300m.
The construction of a new tramline from Kings Cross via central London across the River Thames to Peckham.
East London Transit – £35m.
Development of a ‘spider web-like’ bus connection around Barking and Romford.