HS2

05.11.18

Northern Rail and German owner in crisis talks with government over risk of £282m bailout

Northern Rail are locked in crisis talks with the government along with its owner, Germany’s nationalised train operator Deutsche Bahn, as massive levels of disruption cripple the rail franchise’s finances.

The Telegraph revealed that “catastrophic mismanagement” has led to Arriva, the parent company of Northern Rail, and its German owner becoming locked into crisis talks with the DfT, with the taxpayer bail-out soaring to £282m.

The news comes on the 25th anniversary of the passing of the Act bringing in rail privatisation in Britain, and the rail union the RMT has called for the Northern franchise to be returned to public ownership.

The franchise has suffered this year from a massively disruptive May timetable introduction, which it blamed on late-running electrification work, as well a bitter dispute with the RMT about on-train staff.

The Daily Telegraph claim that Deutsche Bahn is aiming to renegotiate the subsidy profile included in its contract.

Arriva’s terms state that the amount of subsidy is supposed to fall each year, but the timetable chaos and strikes have seen passenger numbers fall and the subsidy rise to £282m.

A spokesperson for Northern said: "We are delivering on all of our commitments and are investing more than £600m to transform local rail in the North — with new trains, better stations, more services and faster journeys for our customers.

"This is the biggest investment into rail in the North in a generation. But the franchise has faced a number of exceptional circumstances, notably the ongoing, late delivery of infrastructure upgrades.

"These delays were out of our control and have impacted growth in passenger numbers.

"As is standard practice, we are in constant dialogue with the Department for Transport about how to improve journeys for customers in the North.” 

RMT’s general secretary Mike Cash said that Arriva Rail North “is a basket case rail franchise sucking up well over a quarter of a billion pounds a year in public bail-outs while wrecking service standards, ripping up the safety rule book and threatening to throw the guards off over half their trains.”

He said: “This scandal needs to end immediately and that means the government taking immediate action to bring the Northern routes into direct public ownership and control with the services run on the basis of safety, security and access and not private profit.

“That means a guard on every train and proper staffing at station level as well.”

Cash said the news mirrored the Virgin collapse on the East Coast Main Line earlier in the year, and called the 25-year-old Act “the Great British Rail Rip-Off.”

RMT demonstrated outside Parliament in line with the quarter century anniversary, and has also announced strike action to take place on Northern lines on every Saturday until the end of the year.

Complaints hit a six-year high for UK railway during the May timetable chaos, according to the ORR who blasted the transport secretary in a report in September, claiming that no one took charge.

 Image credit - Peter Byrne/PA Wire/PA Images

Enjoying RTM? Subscribe here to receive our weekly news updates or click here to receive a copy of the magazine!

Comments

There are no comments. Why not be the first?

Add your comment

 

related

rail technology magazine tv

more videos >

latest rail news

Maritime Transport launch new rail services

17/07/2019Maritime Transport launch new rail services

Maritime Transport has launched two new rail services from DP World London Gateway to its rail terminals in Trafford Park and Wakefield. It ... more >
Campaign for Windsor Link Railway to be revived

17/07/2019Campaign for Windsor Link Railway to be revived

A campaign for a rail link between Windsor and Heathrow Airport is to be revived, after the scheme was turned down by the Department for Transpor... more >
Conwy Valley Line to partly reopen tomorrow

17/07/2019Conwy Valley Line to partly reopen tomorrow

The Conwy Valley line is set to reopen for passengers ahead of the National Eisteddfod in Llanrwst, Network Rail has announced. Llandud... 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 Ye... 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... more > more last word articles >

'the sleepers' daily blog

Apprentice to Co-leading the Rail Sector Deal

05/06/2019Apprentice to Co-leading the Rail Sector Deal

In a series of Q&A’s with key speakers on the run up to TransCityRail Midlands, we caught up with TransCityRail panellist and Amey’s commercial account director, Anna Delvecchio, for her insight into what the Rail Sector Deal means for the rail industry and its supply chain. Anna started her career as an apprentice at the age o... more >
read more blog posts from 'the sleeper' >

comment

The challenge of completing Crossrail

05/07/2019The challenge of completing Crossrail

With a new plan now in place to deliver Crossrail, Hedley Ayres, National Audit Office manager, major projects and programmes, takes a look at ho... more >
Preparing the industry to deliver trains for the future

04/07/2019Preparing the industry to deliver trains for the future

The move to decarbonise the rail network involves shifting to cleaner modes of traction by 2050. David Clarke, technical director at the Railway ... more >
Sunshine future beckons for South Wales Railways, says 10:10 Climate Action’s Leo Murray

02/07/2019Sunshine future beckons for South Wales Railways, says 10:10 Climate Action’s Leo Murray

Smart electrification is the way to boost clean energy resources, argues Leo Murray, director at 10:10 Climate Action. Contractors are clear... more >
Ambition doesn’t have to be expensive, says Midland Connect's Maria Machancoses

02/07/2019Ambition doesn’t have to be expensive, says Midland Connect's Maria Machancoses

The TCR Midlands conference is only days away and tickets are going fast for the sector event of the year at the Vox Conference Centre in Birming... more >

rail industry focus

View all News

interviews

Andrew Haines, CE of Network Rail, tells BBC News his organisation could issue future rail franchises

24/06/2019Andrew Haines, CE of Network Rail, tells BBC News his organisation could issue future rail franchises

By Ewan Quayle, Rail Technology Magazine Reporter Andrew Haines, the Chief Executive of Network Rail, has told the Today programme on R... more >