Rail franchises operators & contracts

16.12.16

ORR opens consultation on changes to TOC charges

Rail operators will be required to pay fixed charges from 2018 as part of new proposals from the ORR.

The ORR has previously said it supports a greater role for open access operators, who are at risk of being deterred by the cost of franchise bidding.

In the new consultation, it announced that it has chosen to recover fixed costs from all passenger operators, including open access operators, in PR18.

“This would represent a step forward in terms of transparency and cost reflectivity, and could facilitate more competition in passenger services,” the report says.

The ORR said the charges would be introduced following a ‘market can bear’ test to establish which passenger market segments could pay the charges.

It considered alternate options, where the amount operators pay is linked to their use of capacity or their access rights, but decided against them because they require too wide a scale of changes at this time.

However, the ORR noted that these alternate options could form part of a “longer term direction of travel”.

It said that costs linked to capacity utilisation could be introduced if a way to measure utilisation is introduced by the 2023 period review, while charges linked to access rights would only be appropriate if “significantly more open access services” were in operation.

For freight operators, the freight only line charge (FOL) and freight specific charge (FSC) will be combined. Furthermore, it proposed abolishing the coal spillage charge on freight operators because of downward trends in coal transport.

However, the ORR said it would not pursue fundamental reform of the variable use charge (VUC) because changes elsewhere, such as the move to increased route-based regulation, made it unnecessary.

It also wanted to consult on whether to either remove caps on the capacity charge or abolish it altogether, saying there were “good arguments” for changing the charge because it is too complex and does not offer sufficient incentives for Network Rail to grow traffic.

The consultation is open until 9 March. To take part, click here.

Have you got a story to tell? Would you like to become an RTM columnist? If so, click here 

Comments

There are no comments. Why not be the first?

Add your comment

 

rail technology magazine tv

more videos >

latest rail news

Firearms officers patrol trains for the first time

26/05/2017Firearms officers patrol trains for the first time

For the first time in rail history, specialist firearms officers will patrol trains across the UK network to ensure that the travelling public ar... more >
Carillion plans job losses as NR renewal cutbacks start to bite

26/05/2017Carillion plans job losses as NR renewal cutbacks start to bite

The RMT has this week vowed to fight “vigorously” against planned cuts to renewals work for Network Rail (NR) being carried out by co... more >
New Merseyrail fleet a platform for future innovations

26/05/2017New Merseyrail fleet a platform for future innovations

David Powell, programme director of rolling stock at Merseytravel, talks about the procurement of the new fleet of metro trains for the Merseyrai... more >

editor's comment

08/05/2017All set for Railtex

As the rail industry prepares for the biggest UK rail show of the year, Railtex 2017, we have produced a specially expanded edition of RTM for you.  Our exclusive show guide, which starts on page 67, provides you with everything you need to know about the things to see, hear and do at the three-day show. A look through our preview pages will give you a good idea of which stands to visit, as well as meetings to set up.  Th... read more >

last word

Collaborative working is the key to the future of rail infrastructure

Collaborative working is the key to the future of rail infrastructure

David Hawkins, operations director at the Institute for Collaborative Working (ICW), on why ISO 44001 is a new evolution in collaborative working. The launch of BS 11000 in 2010 heralded a s... more > more last word articles >

'the sleepers' daily blog

Opinion poll: HS3 must take priority over Crossrail 2

19/05/2017Opinion poll: HS3 must take priority over Crossrail 2

Fresh from their victories in the metro mayor elections earlier this month, new leaders of Greater Manchester and Liverpool City Region Andy Burnham and Steve Rotheram were quick to make transport a top priority for their cities last week. In a post on Twitter, both called on the government to prioritise plans for an HS3 link connecting t... more >
read more blog posts from 'the sleeper' >

comment

Upskilling our workforce: how we need to think

19/05/2017Upskilling our workforce: how we need to think

Simon Rennie (pictured centre), general manager of the National Training Academy for Rail, on the importance of upskilling the current workforce ... more >
Inclusive design of ticket sales counters

17/05/2017Inclusive design of ticket sales counters

Boaz Yariv, senior architect, and Dr Elizabeth de Mello, senior ergonomics specialist at Network Rail, present the main features of the new inclu... more >
Small stations: simple changes for quick wins

17/05/2017Small stations: simple changes for quick wins

Richard Freeston-Clough of London TravelWatch explains how investing in small stations in the capital can deliver many benefits and also have a p... more >
Why are S&C layouts failing?

17/05/2017Why are S&C layouts failing?

Dr Sin Sin Hsu, programme engineering manager IP Track Development at Network Rail, analyses why switch and crossing (S&C) layouts fail prema... more >

rail industry focus

View all News

interviews

Intertrain: ready for the future

23/02/2017Intertrain: ready for the future

RTM recently attended Intertrain’s ‘Driving for Success’ event in Doncaster, where leaders from major players such as Carillion... more >