Rail franchising system scrapped

New ‘recovery’ contracts given to rail firms ahead of new system coming into force

By Jonathan Owen

21 Sep 2020

The policy of franchising Britain’s railways is to end after more than 20 years, the government has announced

Under new “recovery” contracts granted to rail companies from yesterday, the government will continue to cover the losses made by operators for the next 18 months ahead of what the Department for Transport calls a “simpler and more effective structure” that will replace the franchising system.

The new approach will deliver a simpler, effective model through high performance targets and simplified journeys, according to the DfT.

In the meantime, franchising has been replaced with Emergency Recovery Measures Agreements that have tougher performance targets and lower management fees.

The move is informed by a review of the railways by Keith Williams, the chairman of Royal Mail, which was commissioned in 2018 in the wake of what the DfT dubs “a chaotic timetable change and the failure of some franchises.”

And it comes after several months during which the DfT has effectively been managing the railways since it took control back from franchisees to ensure that trains continued to run during lockdown.

Transport secretary Grant Shapps commented: “The model of privatisation adopted 25 years ago has seen significant rises in passenger numbers, but this pandemic has proven that it is no longer working.”

He added: “Passengers will have reliable, safe services on a network totally built around them. It is time to get Britain back on track.”

The DfT described today’s announcement as the “prelude" to the Government's white paper which will respond to the review's recommendations and will be published "when the course of the pandemic becomes clearer."

Keith Williams, chair of the Williams Review, said: “These new agreements represent the end of the complicated franchising system, demand more from the expertise and skills of the private sector, and ensure passengers return to a more punctual and co-ordinated railway.”

Responding to the news, Paul Plummer, chief executive of the Rail Delivery Group, said: “These transitional contracts should be a stepping-stone to a better railway. This needs to harness the experience, innovation and investment private sector operators bring, with local train companies taking the decisions that affect their passengers. It should be overseen by a new guiding mind for the whole industry and underpinned by a simpler to use fares system.”

But Manuel Cortes, general secretary of the TSSA, commented: “Sadly, it looks like the government is once again kicking into the long grass what to do with our railways and instead of grasping the nettle is opting for transitional measures which prop up the status quo. The system was broken well before Coronavirus arrived, but the pandemic has completely exposed its many weaknesses.”

He added: “The Tory government must stop dithering about the future of our railways. Only public ownership will cure its many ills.”

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