Select Committee on Public Accounts Minutes of Evidence

Examination of Witnesses (Questions 20 - 39)



  20. All right. It is not for you to lay down for him, it is for him to decide?
  (Mr Jenner) That is right.

  There has been much public comment on the complicated structure of the railway industry, again Mr Corbett and others, and its regulation. Will the re-franchising process that you talked about and describe in paragraph four of the report resolve this issue or is further restructuring required?
  (Mr Grant) Re-franchising is within the current architecture of the railway. If I can just refer to a recent request by the Deputy Prime Minister to look at the situation we find ourselves in, I need to make sure that the Committee understands that we are not looking at the architecture, we have been asked to look at the hotspots, where we can make the architecture work better. In response to that we, with the rest of the industry, have put together five working groups to look at how to do things better in the existing architecture. Those five working groups are covering performance, possessions, vehicle acceptance, the Railtrack contractual regime and subcontracting and, finally, a group which is entitled "The Scale of the Agenda", is the agenda capable of being delivered. Those working groups are going to report back in early December and will report to the Deputy Prime Minister during December. The intention is that the findings of those groups should be incorporated within our strategic plan in January. The groups have been asked to look at, as I say, where the hotspots are and where we can work better. They have been asked to identify what those problems are, who the parties are that may be able to resolve it and a general direction where the resolution might be, but not to look at the overall architectural structure of the railway as it stands.

  21. Performance includes presumably, reliability, punctuality and safety.
  (Mr Grant) Safety is not on that particular agenda. The performance issues are also going to look at perverse incentives, where there may be a cancellation rather than running the train.

  22. Possession, what is that? The industry asset register.

  (Mr Grant) Possession is really how we get more out of possessions because the actual work in possessions is not as effective as it should be. Where you could get a long possession by cancelling one train we need to get the industry to work together rather than having ten short possessions. Also, how does the economics work between Railtrack and the train operating companies? Is in their best interest to allow long possession or uneconomic short possession? It is how the whole economic situation works on possession.

  23. It sounds to me like possession is using up the actual track, is that correct?
  (Mr Grant) I did not quite hear that.

  24. Never mind, I will press on. I am sure others will come back to you on that. Paragraph 4.6 shows a continuing increase in complaints by passengers, over 1 million in 1998/99. What do you propose to do to remedy that?
  (Mr Grant) Complaints by passengers are obviously not something that will take, hopefully, many years to resolve. A lot of the passenger complaints are not being handled adequately and we produced this document which is called "On Track". It is a survey of 20,000 passengers surveyed every six months as to their concerns. Clearly the underlying problems will not be solved in a short time but the way that the passengers are responded to can be addressed quickly. That is one of the main concerns we found in our sample population of 20,000 people. What they were dissatisfied with was, value-for-money, that was a big issue and also how train operating companies were responding to their complaints. In the franchise agreement going forward we will be using this document to sharpen up the act of the train operating companies. Mr Jenner can go through them in more detail in a minute. We will be able to use this document and the findings of it to force the train operating companies to do something about it.

  25. No doubt others will bring you back in. After Ladbroke Grove, Southall and Hatfield there is obviously a great focus on safety. I recognise you are not a safety regulator but you may take a strategic view of the industry, how do you intend to address the safety issue?
  (Mr Grant) We have been giving evidence to Lord Cullen's Inquiry and historically OPRAF had no express responsibility for safety. The SRA will have a statutory obligation to have regard to safety in particular as advised by the HSE. In the evidence we have given to the Ladbroke Grove Inquiry, part two, we said that it is not our role to second guess Lord Cullen, and we await his conclusions. We did say there was a case for a single regulatory body for safety, and that should be considered. We did advocate a CAA-type model, as in the aviation industry. We did support on a short-term basis the formation of Rail Safety Limited and we did support the position about accident investigation being separate from safety regulation. We have given quite a lot of our views, but recognising that they are views and we await Lord Cullen's findings.

  Chairman: Thank you.

Mr Rendel

  26. I have a train to catch, unfortunately, fairly soon. I do not suppose it will be delayed on leaving, it may be delayed on arriving. Can I ask some questions about compensation. Compensation as far as the passengers are concerned rely on their train being more than an hour late?
  (Mr Grant) As a general rule or in the current situation?

  27. As a general rule. I am not talking about post-Hatfield particularly.
  (Mr Grant) It does vary from train operating company to train operating company.

  28. There are some ways you can get compensation for less than an hour?
  (Mr Grant) There are some.

  29. Is that part of the franchise agreement?
  (Mr Grant) It is part of—Mr Jenner will correct me—the original set up. Looking forward under the new franchise agreement there are new arrangements for compensation.
  (Mr Jenner) Under the original franchising agreement every operator was required to have in operation a Passengers Charter under which the compensation arrangements are paid, no less favourable than that existing with BR. BR's practice was to pay compensation after an hour's delay. Under the new franchise agreement with the replaced franchising we are asking counter parties to make proposals to better that which is currently the position. In the case of Chiltern and South Central they have come forward to do just that. The general rule at the moment is that compensation, other than monthly and yearly season ticket holders, is paid after an hour's delay.

  30. It seems obvious from Figure 8 that the trains that go longer distances are more inclined to be more than ten minutes late than the trains that go shorter distances. Is there not a strong case for including within the franchise agreements some compensation scheme which allows for a percentage of the train's journey to be late rather than a straightforward one hour, regardless of the length of the journey? My own journey from Newbury takes about one hour, and it is about an hourly service, so if the train is going to be an hour late I might as well catch the next one and be on time or be within my hour, which means I will never get compensated.
  (Mr Jenner) Under the proposals, certainly for Intercity operators such as First Great Western, the idea is to ally the compensation payable to the operator from Railtrack with the compensation payable to the passenger. The compensation to the passenger, certainly on the Intercity regime, will be payable after 30 minutes. That will be the form of payment that comes from railway through the train operator to the passenger. It will be 30 minutes under the Intercity regime going forward.

  31. That was not the question I asked. Would it not be more sensible to introduce a scheme under which the shorter the journey the shorter the delay you had to have before you got compensation?
  (Mr Grant) It sounds logical, but the downside of that is the complexity of the administration arrangements about where you got on the train and what time it started, and how you could check that would be considerable.

  32. If compensation arrangements are to be an incentive you are going to have to have some sort of scheme for the short distance trains otherwise there is no incentive really.
  (Mr Grant) Compensation is for the passengers. The incentive regimes are more penal to the train operators and do not necessarily reflect directly the compensation to passengers.

  33. It seems to me, from personal experience, it is quite likely that a lot of people who are eligible for compensation do not claim it, they do not ask for the forms, they do not know whether they are eligible, they are not sure how late the train is, all sorts of different reasons. Do you have any figures for what proportion of passengers who are eligible for compensation actually claim it?
  (Mr Grant) I do not have those figures to hand, but we can follow that up.

  34. Have you done the research already?
  (Mr Grant) It would be a question of looking at the numbers. We have not done the research. The most recent experience is period eight of this current year, where there is a lot of detailed material. Those are exceptional circumstances at the moment.

  35. One of the difficulties that passengers appear to be having at present is proving they did the journey that was delayed. One of reasons for that appears to be that very often their tickets are removed from them by a man standing at the gate or by an automatic ticket collection machine. What feelings do you have about whether there is anything that can be done about that?
  (Mr Grant) In the current situation with the train operating companies and the Regional Rail Passenger Council we agreed that it should be proof of travel as opposed to a ticket, which is a little softer.

  36. It is very difficult if you paid in cash and you do not have a ticket.
  (Mr Grant) The sort of thing that has been suggested is if you went to a meeting or your employer gave you a letter and said you were late. The train operating companies are going to be sensible about it, but obviously it is open to abuse as well.

  37. Can I go on to Figure 10, this is the original Figure 10, we have had an update on this figure, which shows a different position in more modern times. Can I ask why so many of the call-ins for cancellations for Great Western, in particular, are ignored because they are said to be force majeure. There was a very large number in this last year, according to our updated table.
  (Mr Grant) There are a number of reasons. First of all, the Ladbroke Grove incident; there was a line closure between Reading and Paddington due to the defusing of a World War Two bomb; there was a signalling system defect at Uppington, located between Swindon and Didcot, and force majeure incidents agreed to ten cancellations and six cancellations; a restriction of access between Didcot and Swindon, a cable fault, which was agreed as force majeure, which included four cancellations. The total cancellations is 12 cancellations. Then there was no access to Patchwaite Tunnel; and then there was a security alert at Acton, between Ealing Broadway and Paddington. There were a number of reasons that we looked at.

  38. Some of those, the bombs and security alerts, cannot be laid at the door of the operating companies or Railtrack. It sounds from that as if quite a number of the problems were something to do with the track or the way the track went over or under. Does this indicate that the rail track itself that Great Western runs over is in a worst state than some of the track across the rest of the country?
  (Mr Grant) I would not have that detailed information about the comparison of the track between various parts of the country. First Great Western does have a penalty incentive regime, it is not like some of the intercity operators, where they do not have at the moment but will have in the future.

  39. Can I ask about passenger growth quickly. Passenger growth was going ahead quite quickly for a long time but it may, of course, have been cut back by the recent incidents and some people think it may go into reverse as a result of the recent incidents. What sort of research have you been doing into why there has been that passenger growth and are you doing any new research at present into whether that is likely to continue?
  (Mr Grant) If I can deal with the second question first. Whether it is likely to continue or not is a difficult subject to forecast at the moment clearly in the light of Hatfield. I can refer the Committee to 3.19 where that was work done by ATOC and Railtrack where they suggested that one of the real drivers of growth was traffic congestion as a main factor. We have done a considerable amount of work on the reasons for traffic growth and they were also listed, such things as what would drive growth: cheaper fares, better stations, better connections? We have done work and the principal reasons for them are listed in the document.

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