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More competition on inter-city routes 'would improve passenger services'

More opportunities for open access operators on inter-city rail routes would improve services for passengers, the CEOs of the Competition and Markets Authority (CMA) and Office of Rail and Road (ORR) have told the Transport Committee.

During a hearing yesterday, Dr Andrea Coscelli, acting chief executive of the CMA, said that the CMA has had “initial conversations” with the DfT about the possibility of introducing a levy on open access operators, which it plans to “take forward in consultation” in the autumn.

In addition, the ORR is in consultation with Network Rail about changing track access charges for open access operators so that they pay fixed as well as varying charges, like other operators do.

Dr Coscelli said that although this would mean increased costs for open access operators in the short term, in the long term it would benefit them by making open access a more financially attractive prospect for the DfT.

“The reforms that we’ve been talking about in terms of track access charges and the possibility of a levy would address that tension between the secretary of state’s funds and the benefits that competition could bring across the network,” he said. “Currently, if you don’t get the franchise, you’re not in the market. If open access was across the network, you’d have another opportunity for your business.”

Dr Coscelli added that current operators wouldn’t suffer because the changes would come into effect on future franchises.

“It’s really about planning a change in the rules for the future set of franchises,” he said. “The passengers would have much more of an active choice to walk with their feet and choose the competing operator, so that would help. In terms of any extra pressure on the competing operators, it would be very much what we have today.”

He also said that there should be at least two operators on each inter-city line, one franchised and one open access.

Instead of having only one franchise which can be awarded to one company, he said this would “create two opportunities, maybe three opportunities to win something”.

This, he said, would “make it easier for foreign entrants to justify remaining in the UK market”.

“Obviously it’s in the interests of passengers to retain enough bidders who are serious about remaining in the UK in the medium and long term,” Dr Coscelli added.

There are concerns about foreign companies leaving the UK following the country’s vote to leave the EU. The ORR has also proposed changes to the UK’s franchising arrangements in order to promote open access operators.

Joanna Whittington, chief executive of the ORR, said that increased competition should apply to the three big inter-city routes (West Coast Main Line, East Coast Main Line and Great Western Main Line).

“I don’t think it’s a model that we would like to see extended into other markets at the moment,” she added.

Dr Coscelli said that competition will be piloted on the East Coast route, where the ORR recently approved additional services. This could then be used to inform the next round of appointments for the West Coast and Great Western franchises.

Whittington said that competition can deliver better services and lower fares for passengers. She added that existing open access operators have already introduced new innovations – for example, Grand Central was the first to introduce on-board wi-fi, and First Hull was the first to introduce real-time operational information on trains.

She also said that the ORR should have the power to publish more information about operators, in order to provide a “reputational incentive” for operators to increase their performance.

MTR Corporation West Midlands recently withdrew from bidding for the West Midlands franchise after announcing that it was joining with First Group to bid against Stagecoach for the South Western franchise. This left London Midland and West Midlands Trains competing for the West Midlands franchise, meaning that two of the biggest franchises in the UK have just two competitors bidding.

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Simon   06/09/2016 at 14:09

Well finding new paths on certain routes would be an issue if there is insufficient infrastructure to support such grand schemes, being a train planner finding new paths on key routes is difficult at the best of times, infrastructure improvements would need to be made, increasing headways and improved signalling, however I think open access would be good for the south west route into Devon and Cornwall given that GWR have the monopoly but given the geography and gradients on the Devon banks this has always been an issue but still something which could be looked into.

John   06/09/2016 at 14:45

One Operator that could do wit hsome Competition would be East Midlands Trains as they have a strangle hold and block out any possibility of another Operator coming into Leicester, Derby or Nottingham. With the extension planned of the Thameslink line up to Wellingborough, extend the 4th track to Kettering then use the Corby / Oakham / Melton / Syston North to run a competitive service to Nottingham and Lincoln - NOT, I Repeat, Not XC Trains / Arriva / DB!!!

Jak Jaye   06/09/2016 at 16:10

What has Brexit got to do with running our railways? we dont need foreign vultures circling just for the sake of high profits(got enough homegrown) The whole franchise system has been flawed since day one and nothing short of taking lines back into public ownership via the DFt will change it. All that happens is when a franchise is up for grabs the same greedy firms get them. And as for cheap fares,when was the last time that happened!

Huguenot   06/09/2016 at 19:54

I think that it was a mistake when an earlier Government had a policy of having only one operator per London terminal station, e.g. getting rid of Thames Trains who competed with GW, and making the whole of East Anglia into a single franchise, thus reducing competition on e.g. London-Ipswich. Similarly Gatwick Express and Southern (and look where that has now got us). At least we still have competition London-Cambridge (Gt Northern and Abellio) and two operators out of Euston (VTWC and LM). I agree that EM needs some competitive pressures to reduce its fares, as does SW Trains.

Jb   07/09/2016 at 11:02

I believe a competitor to Virgin for the Manchester - London traffic would be desireable. I suggest that East Midlands Trains could offer an express service from Stockport to St Pancras via the Totley chord to provide a direct connection to Derby and Leicester, etc., once more. These journeys, once so simple, cannot now be made without changes and slow trains.

Andrew Gwilt   07/09/2016 at 16:55

Abellio who extended the contract to 9 years for taking over the East Anglia franchise will spend billions on ordering brand new trains from 2019 and to introduce wifi on commuter trains aswell investing millions to improve and refurbish the current rolling stocks such as the Class 321's & Class 317's EMU's aswell Class 379's & 360's EMU's, Class 153's & 156's DMU's aswell Class 170's DMU's and Class 90's Mk3's with wifi being fitted onto those trains and new air-conditioning to be fitted onto the Class 321's and Class 317's EMU's before new trains are built and ordered to replace the ageing rolling stock trains used on GEML Essex routes & Intercity route, WAML routes and regional routes across East Anglia and Essex to/from London Liverpool St.

Chris M   07/09/2016 at 17:08

The two open access operators on the East Coast have provided important new links and have ensured all fares have been moderated - compared to the West Coast where Virgin enjoyed a long monopoly. However the OA operators run short 5/6-car trains into Kings Cross and this has meant less seats available overall. I would agree with Jb that Leicester, Loughborough,Derby and Chesterfield deserve much better direct links to Stockport, Manchester and Liverpool. It can be done as proved by Project Rio between 2006 and 2008 using the south curve at Dore. Just a shame that the scenic and shorter Peak line north of Matlock has not been re-instated. That line closure was a serious mistake by the government in 1968 (and not Dr Beeching's fault as many believe).

David Fenner   07/09/2016 at 20:25

Will this really work and is it really helpful. The prime competitors are road and air travel. the real challenges will be the sufficiency of suitable paths, the availability of compatible rolling stock, in terms of performance, and finally the arrangements to cross accept tickets when things go wrong. It mustn't become acceptable that a cancelled train or perhaps a missed connection because of another trains delay results in an extended wait until the next train operated by the ticketed operator.

Jb   08/09/2016 at 01:30

Of course, the reinstatement of the 12 mile or so Peak route would be of great benefit to Manchester - St Pancras journeys and should be high on the Govt's., 'to do' list. (Higher than HS2!). This would be the ideal solution and should not be too difficult to achieve as the alignment already exists, albeit with refurbishment. However, a service via the Dore West to South curve could be instituted with the minimum of delay. I used it in the weeks immediately before the introduction of the Pendolinos and much enjoyed freshly cooked full breakfasts in the HST Mk3 dining car. As Chris M points out, many more major city connections could be achieved and it is most surprising that that proposals have not been brought forward. If a service via Dore were to be introduced, I believe it would not be long before the operator pressed for the shorter (and most picturesque) to be reopened.

Paul Dunbavin   15/09/2016 at 11:36

I concur with the comments regarding competition for East Midlands Trains especially. This company has an unused mainline Sheffield to Leicester & St Pancras with potential stops all down the Erewash line in a conurbation that adds up to the population of a major city. It is crying out for someone to offer a fast service from north of Sheffield stopping at these stations then Leicester to London. They don't offer this simply because they would be competing with their own services.

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