Comment

13.05.19

The railway franchising model is broken, and passengers are paying the price

Source: RTM April/May 2019

Meg Hillier, MP for Hackney South and Shoreditch and chair of the Public Accounts Committee (PAC), gives her view on the state of the UK’s rail franchising structure.

The PAC has repeatedly raised concerns about the current franchising model; it has been challenged in the courts and we see few bidders for each franchise. All clear signs that there is a problem.

Significantly, leading industry figures have hinted strongly that the franchising model needs reform. Keith Williams, who is heading up the government’s ‘root and branch’ review, was supported by Network Rail chair Peter Hendy, who spoke out at the same time to talk up the break-up of Network Rail into regional companies.

The government must step up and transform the current culture of complacency that permeates the Department for Transport (DfT) and the rail sector.

The DfT is responsible for designing, awarding and managing its current 14 franchises. We have seen too many failures and nearly every franchise model is different. While one size will not fit all in a complex and regionally varied system, there seem to be too few lessons learnt from failure and too many complexities built into the system.

And the botched West Coast franchising (where Virgin took the government to court after losing out) has led to even longer run-ons of existing franchising, and has undoubtedly been part of the reason why so few companies bid for each franchise (typically the incumbent and one other).

The largest, Govia Thameslink Railway (GTR), combines four rail services: Thameslink, Southern, Great Northern, and Gatwick Express (TSGN). This is a different model to just the straight franchise and has left passengers suffering. In our most recent report, the PAC criticised the unacceptable delays and cancellations caused by the botched rollout of the new railway timetable last year, a change that should have been routine but caused chaos.

Rail maintenance is also a key issue. Network Rail conceded the deterioration of the rail infrastructure had impacted on wider service reliability, contributing up to 13% of delays between July 2015 and March 2017.

The buck does not stop here though.

Our 2018 report is clear that the DfT made the GTR situation even more complex with plans to increase driver-controlled operation of trains – at best ambivalent about potential industrial action as a result. It failed to, or chose not to, see the perfect storm of an ambitious upgrade programme, a complex management model, and a change which was not popular with the trade unions. And it was not focused enough on its role as passenger champion.

These failures also raise wider questions about the DfT’s ability to manage rail franchise contracts. The DfT-designed TSGN contract removed the usual incentives for the operator to maintain performance levels for passengers. The East Coast franchise failed for a third time because of inaccurate passenger growth forecast.

Ultimately, it is the taxpayer and passengers that pick up the tab. The DfT’s management of franchise contracts has left behind a trail of cost overruns, failed franchises, project delays, and disruption. There is a danger of this becoming the new normal. This is unacceptable.

The government’s ‘root and branch’ review is a welcome step. But with it only due to report in the autumn of 2019, and any implementation scheduled for 2020, there is a danger the government has already written 2019 off for both rail passengers and the taxpayer.

It was significant that at the same time as the PAC’s most recent report was published, both Williams and Hendy spoke robustly about the need to change. The PAC does not take a policy stance on whether the government should operate the railway under franchises. Our role is to examine the effectiveness of government policy. It is telling that the only strong champion for the current franchising model is the government itself.

Even the companies running the franchises want a different model – one that allows more innovation, moves faster through the bidding process, and provides some certainty that their investment will be worthwhile.

In Whitehall, the existing policy is usually defended until a new one is on the stocks. It is significant that there are senior figures dropping hints that the rail review will propose sweeping change. But if it does, the DfT has to be clear that implementation must be well planned and properly focused. Painful as it is to move slowly, it would be a mistake to move too fast. Time invested in planning for change at the start will ultimately lead to a better chance of the plan being implemented successfully.

The government must now recognise the franchising model for delivering rail services is broken and be prepared to shake up the system to put passengers first.

 

Top image: Johnny Green via PA Images

Comments

There are no comments. Why not be the first?

Add your comment

 

rail technology magazine tv

more videos >

latest rail news

View all News

rail industry focus

Better connected with a universal information system

08/05/2019Better connected with a universal information system

Maddy Grant, marketing and content specialist... more >
It's the little things in rail

29/03/2019It's the little things in rail

Dan Lee-Bursnall, commercial director at Incr... more >

editor's comment

23/01/2018Out with the old...

Despite a few disappointing policy announcements, especially for the electrification aficionados amongst us, 2017 was, like Darren Caplan writes on page 20, a year generally marked by positive news for the rail industry. We polished off the iconic Ordsall Chord (p32), hit some solid milestones on Thameslink (p40), progressed on ambitious rolling stock orders (p16), and finally started moving forward on HS2 (p14) ‒ paving the way for a New Year with brand-new infrastructrure to... read more >

last word

Encouraging youngsters to be safe on the railway

Encouraging youngsters to be safe on the railway

This summer, Arriva Group's CrossCountry and the Scout Association joined to launch a new partnership to promote rail safety among young people. Chris Leech MBE, business community manager at the TOC, gives RTM an update on the innovative scheme. Recognising that young people are more likely to take a risk trespassing on railway tracks, C... more > more last word articles >

'the sleepers' daily blog

Meeting clients, suppliers and stepping forward

23/05/2019Meeting clients, suppliers and stepping forward

The Midlands 30-year plan will deliver many economic benefits and will need a wide and diverse supply chain to deliver some of the key projects. We caught up with long running sponsors of TransCityRail, Bridgeway Consulting Limited, specialists in Site & Ground investigations, Geomatics and Infrastructure, to discuss why networking events ... more >
read more blog posts from 'the sleeper' >

interviews

Advancing the rail industry with management degree apprenticeships

08/05/2019Advancing the rail industry with management degree apprenticeships

In answering the pressing questions of how current and future generations of managers can provide solutions to high-profile infrastructure projec... more >
Women in rail - is the industry on the right track?

12/03/2019Women in rail - is the industry on the right track?

RTM sits down with Samantha Smith, sole female member of the TransPennine Route Upgrade Alliance Leadership Team, to find out more about encourag... more >
TfN Strategic Transport Plan: not just for transport's sake

22/01/2019TfN Strategic Transport Plan: not just for transport's sake

Peter Molyneux, Transport for the North’s (TfN’s) strategic roads director, has been leading on the development of the seven economic... more >
Exclusive: Midlands Connect and WMRE talk collaboration and investment in the Midlands' railway

22/01/2019Exclusive: Midlands Connect and WMRE talk collaboration and investment in the Midlands' railway

In the jigsaw puzzle of regional transport decision-making, there must be collaboration and compromise. Midlands Connect media lead James Bovill ... more >