HS2

15.12.15

More international operators seek to win UK rail franchises

The Department for Transport (DfT) has chosen the first 11 operators that have been successful in their pre-qualification questionnaire (PQQ) passport application – the government’s new approach to rail franchising.

Trenitalia, Italy’s state-owned rail operator, is among them, as is MTR Corporation, which runs the Hong Kong metro system and the Crossrail concession (under the name TfL Rail for now), and has been operating London Overground as part of a joint venture since 2007.

The full list of operators includes all the main franchised operators on the national rail network, including others owned by foreign state-owned rail companies:

  • Abellio Transport Group Limited
  • Arriva UK Trains Limited
  • First Rail Holdings Limited
  • Go-Ahead Holding Limited
  • Govia Limited
  • Keolis (UK) Limited
  • MTR Corporation (UK) Limited
  • National Express Trains Limited
  • Stagecoach Group Plc
  • Trenitalia SpA
  • Virgin Holdings Limited

These companies will be able to submit their expression of interest for all future franchise competitions within the valid timeframe of the passport from today (15 December).

The passport was created to innovate, streamline and modernise the DfT’s procurement practice, as well as encourage applications from new and international entrants that have an interest in the rail passenger market.

On 2 December, during a Public Accounts Committee evidence session, the DfT admitted that its rail franchising contracts in the past have been “overly rigid”, but said this was now changing.

Its permanent secretary, Philip Rutnam, said the government was taking an active approach to talking to international operators not yet in the UK market.

Peter Wilkinson, managing director for passenger services at the DfT’s Rail Executive, expected there to be two or three new entrants to the market in the next few years and confirmed that the DfT had already spoken to four international operators at that point.

He added: “We operate a very open dialogue with our market. We see those companies seeking to enter the market in the same way we see those companies that are already in the market, and we are very open with them about the franchising process.

“One of the things we have done that was not present before the West Coast competition collapsed was absolutely to publish our franchising process to remove the mystique around it – to demystify it.”

The passport system was based on similar pre-qualification and certification schemes in other parts of the market, aimed at cutting down on the time and money organisations spend providing technical information for multiple franchise competitions.

Rail minister Claire Perry said: “The quality of the submissions evidenced that we had explicitly sought high standards, integrity and professionalism from the national and international market. During the assessment stages, we scrutinised and scored technical ability, strict safety standards and exemplary management practices.

“Our approach has resulted in diverse and competitive market bidders from the UK and overseas who now hold a passport.”

Their passports will be valid for up to four years, during which operators can apply for all future franchise competitions without needing to submit the same information each time.

“This supports the department’s effort to drive innovative customer-focused thinking and delivery from operators. Putting the passenger first is at the heart of all our franchise tenders and I believe this passport will keep the market fresh and dynamic,” Perry continued.

“We can now focus our efforts on managing and negotiating the life-cycle of future franchises, build the necessary long-term industry relationships and continue to encourage parties from the UK and overseas to participate in our marketplace. This announcement is a hugely positive step and I am looking forward to seeing great results from a healthy, competitive open market.”

(Top image c. Alvey and Towers)

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