Transport Secretary Chris Grayling brings huge change to UK railways making Network Rail accountable to passengers – but not for at least three years

Published: 7th December 2016

Will Island Line to provide the template for the future for integrating train and track management?

The railways are facing yet another massive re-organisation over the next three- to five years following Transport Secretary Chris Grayling’s announcement to Parliament that Network Rail (NR) will yet again be subject to a massive re-organisation.

This another attempt to bring better value for money and punctuality for passengers and taxpayers which has suffered by the way the system was privatised 20 years ago and subsequently managed by the Department for Transport (DfT). Punctuality has suffered due to more and more trains running carrying record numbers of passengers which perversely is good news!

Mr Grayling acknowledged that “Britain’s railways are crucial to our economic future” and that ridership has doubled in the last 20 years. This growth has brought its own challenges as more trains are operating than before often with services starting earlier end ending later shrinking maintenance time for NR’s engineers.

It also means that when a line is closed for upgrade, such as the Severn Tunnel in September, it still causes serious disruption occurs, even though it is planned in advance and alternative arrangements are made.

Adapt and change says the Government

Mr Grayling said that our railways need to adapt and change be able to cope with growth and the future. This will bring a modern train fleet on the East Coast and Great Western main lines for example. This, combined with Thameslink, Crossrail and HS2, will also bring more challenges and a more crowded rail network.

The Shaw Report commissioned by the Government recommended that NR devolved responsibility to route levels from its Milton Keynes HQ. Five years ago, Sir Roy McNulty was commissioned to review the railways and to suggest how they could be changed to become more efficient and achieve better value for money bust most of his recommendations were ignored.

Mr Grayling will start the changes at an operational level by bringing local operations closer between the train company and NR.

Network Rail currently pays out around £300 million annually in delay and disruption compensation to train companies under Schedules 4 and 8 in their respective Track Access Agreements. It seems that the announcement wants to see each train company working with the local NR route/area management teams which could reduce these payments as less disruption will take place.

This re-organisation is designed, the Government says, “for all those involved to be incentivised to deliver the best possible service for the passenger”. Mr Grayling also said that he expected new franchises commencing with South Eastern and East Midlands to use integrated operating teams between train services and infrastructure.

Transport for London gets their way

Transport for London (TfL) will help specify the next Southeastern franchise with a representative embedded in the DfT franchise specification team. This follows the very public TfL bid to run Southeastern metro services announced in November. The DfT says they will develop the model for greater alignment of track and train as further franchises are renewed including the option of joint ventures.

East West Rail announced yet again but this time with grand designs

The Transport Secretary yet again announced the East West Rail reopening project would be going forward. But this time he announced that he wanted to introduce what he called ‘new skills’ into the challenge of upgrading our railways.

He said that; “This will start by looking at the reopening of the link from Oxford to Cambridge by establishing East West Rail as a new and separate organisation. This he says will accelerate the permissions needed to reopen the route, and to secure private sector involvement to design, build and operate the route as an integrated organisation. This East West Rail organisation will be established early in the New Year and chaired by the former Chief Executive of Chiltern Rail, Rob Brighouse.

The reopening project will be carried forward by what is called a ‘special purpose vehicle’ to progress East West rail for the benefit of passengers and to create a new franchises to bring closer working between track and train.

A statement of the obvious?

Mr Grayling also said that he wants closer working across the industry to resolve problems more quickly and putting the needs of the passenger first. But of course this should already have been the focus of all rail franchises and monitored by the DfT. A a recent Transport Select Committee Hearing, a Govia director said that his customer was the DfT and did not mention passengers at all.

He also said that; “I intend to start bringing back together the operation of track and train on our railways. Our railway is much better run by one joined up team of people. They don’t have to work for the same company. They do have to work in the same team.”

And Network Rail’s Mark Carne welcomed the announcement

Mark Carne, chief executive of Network Rail said; “We strongly welcome these plans to bring more joined up working within the industry. We have already devolved Network Rail into route-based businesses closer to customers, and the proposals announced today will build on the alliances we have created between these route businesses and train operators.

We also strongly believe there should be better alignment of incentives between train companies and Network Rail. That is why we now align the performance incentives for all of Network Rail’s 35,000 staff, around targets agreed jointly with train operators.

“Competition must be at the heart of any organisation that wants to behave like a private sector business. Competition breeds efficiency and innovation and will further encourage our own teams to push aside the barriers holding them back. That is also why I announced last month that Professor Peter Hansford will chair an independent review into the barriers to competition in all elements of delivering rail engineering projects.”

Last month Mark Carne also announced the creation of Boards for each of the devolved route businesses, involving passenger representatives. These boards will oversee the running of the railway in their area.

He said at the time: “Passengers deserve a railway focussed on their needs, to create economic growth, for job creation and housebuilding, and that's what we're working hard at.”

Rail.co.uk comments:

Currently NR is allocated just over 60% of all delays but they do not ever have to face passengers or freight customers. The train operating companies have to deal with the end user, passengers and manufacturers who use rail to move huge tonnages of goods and containers around the UK. The blame game therefore goes round in circles with train companies making millions from NR compensation payments as a high percentage of passengers do not claim their refunds of just a few pounds.

Re-integrating track and train – will it work Isle of Wight style?

There is one UK rail model that is already integrated, Island Line on the Isle of Wight. Southwest Trains (SWT) maintain the track to a depth of 42 centimetres below the railhead and below this is it becomes NR’s responsibility to maintain.

Following storm damage a couple of years ago, NR spent nearly £3million on repairs and now SWT have to repay this before their franchise ends. This has skewed the finances for the line which has become the subject of an IOW Task Force to investigate ways of reducing the line’s heavy losses which has been covered on this website in depth. The task force is led by Chris Garnett who the DfT Southwestern team said in January 2016 was also a DfT franchise bid assessor/moderator.

Literally the 64 Million pound question…

But this leads to a larger question. No rail franchisee will invest huge amounts of money into the infrastructure unless they can be repaid within their franchise. At the moment, a franchisee owns nothing, it leases trains and stations and takes on the staff from the previous operator and passes them on to the next one at the end of the franchise. And who will carry out the physical track, signalling and bridgeworks? The same companies as now, this has not been made clear.

The proposal is that Alliances will be the way forward, the Wessex Alliance between SWT and Network Rail failed ignominiously while the existing one in Scotland between Network Rail and Abellio is also seriously under-performing as has also been covered by this website.

But don’t forget the front-line railway staff who will do their utmost to keep trains moving as best they can - despite being a political football.

External Links

• GOV.UK
• Network Rail