Select Committee on Transport, Local Government and the Regions Appendices to the Minutes of Evidence

Memorandum by the Rail Passengers Council (PRF 17)


  The Rail Passengers Council welcomes the opportunity to be a witness for the Transport Sub Committee's inquiry into passenger rail franchising. This memorandum draws from the RPC Network's detailed "Response to the Draft Directions and Guidance to the Strategic Rail Authority and Draft Franchising Statement", which was submitted to DLTR on 13th September 2001. The RPC Network's submission to the Strategic Rail Authority in June 2001, "The SRA's Strategic Agenda—Informing the Strategic Plan" has also been referred to. Both these documents are in the public domain and are available on request.


  1.  In laying out targets for rail, the Government's wider policies for reducing traffic congestion, contributing to sustainable development, moderating environmental damage, promoting economic development and social exclusiveness should inform the industry targets set out in the Ten-Year plan and developed here. The wider policies should underpin the targets.

  2.  Targets are national and are not disaggregated. There is concern that investment will, therefore, be focussed on existing intercity routes and some London commuter routes as the most efficient way of meeting these national targets within the available resources at the expense of developing infrastructural possibilities which meet the changing needs of our society.

  3.  Dialogue with local authorities, devolved government, regional assemblies, PTEs and other stakeholders such as the RPC network is vital to ensure that the SRA is fully aware of the economic, social and environmental impacts of its activities. This should be emphasised throughout the Directions & Guidance.

  4.  There is concern within the RPC network that "minimal restrictions" on operators do not always work in the best interests of passengers. Regulation is designed to step in where commercial incentive or monopolistic practices work against the interest of the consumer. In some areas, the monitoring and enforcement of requirements is to be advocated. In these cases regulation should not be seen as "restrictions" to commercial creativity, but as baseline standards of conduct and accountability.

  5.  The Rail Passengers Council and Committee network welcomes the intention to deliver early improvements for passengers. However, "quick wins" must not be at the expense of long-term investment. Any short-term plans and outputs must lay the foundation for the long term.


Ensuring rapid improvements in the safety, punctuality, reliability, comfort and frequency of services are achieved.

  There is concern that the approach outlined in the draft franchising statement, of varying or extending existing franchise agreements, may herald a retreat from the financing of long-term investment requiring long lead times in favour of quick short-term gains (presumably at lower cost). This overlooks the fact that although passengers may have to wait longer for some improvements to occur, those improvements to infrastructure capacity (or new rolling stock) may be precisely what is needed to improve reliability and punctuality as well as provide for growth of use on the railway.

  It may be that quick wins are achievable, eg through better management of existing operations and improved maintenance arrangements, and we would wish the SRA to be much more pro-active in these areas.

  However, for the more substantial investments described in paragraph 7 of the draft franchising statement, the long lead times coupled with the long life of the assets mean that there is a difficulty with the idea that two-year extensions taking franchises up to 2006 could deliver significant improvements.

  The Rail Passengers Council welcomes the requirement in the draft directions and guidance to the SRA that the franchise replacement process should require extra investment in rolling stock, service standards and safety, and that the SRA must monitor obligations and "take prompt action if train operators fail to meet them."

  However, it is not clear what is meant by "prompt action". Historically, some breaches of franchise have resulted in little action, and arguably action could/should have been taken earlier to avoid reaching this stage.

  The template franchise agreement for new franchises has addressed some of the shortcomings of the old franchise agreement, for example by stipulating more passenger counts and tighter planning to avoid overcrowding, a new performance regime based on PPM and passenger satisfaction measures based on the National Passengers Study. However, the Rail Passengers Council remains concerned that:

    (a)  the franchise replacement process has been delayed; and

    (b)  should the new franchise agreements be adopted for replaced franchises there will be non-standard conditions between different franchises as older, longer franchises are on the old terms and any changes can only be negotiated individually.

Securing investment in additional network capacity and other improvements to meet both the long-term and short-term needs of the railways. The adequacy of the sums allocated to rail in the 10-Year plan given subsequent events

  There is concern within the Committee network that the figures stated in the 10-year Plan are no longer relevant. Since the 10-Year Plan was published there has been a considerable change in Railtrack's circumstances. The Hatfield derailment revealed the network to be in a substantially worse condition than was realised and public funds have been allocated to Railtrack to retrieve this situation. There is still a maintenance and enhancement backlog and if the Government accepts the Uff/Cullen report recommendations for train protection this will also be expected to be publicly funded. The Government should explain how these unforeseen expenditures can be reconciled with unchanged policy objectives and funding totals.

  Furthermore, there is scepticism that the current climate can encourage £34 billion private investment in rail. If the government or the SRA have ideas for generating the required investment within the span of the proposed short franchise extensions, then these need to be published and tested in public debate. However two-year extensions in the present changed financial circumstances should not be used to defer long-term investment decisions. A further two-year extension cannot be permitted after a first.

  For the rail network to be developed to a stage where it can operate effectively at the heart of Government's integrated transport strategy it is likely to require even more funding than is already allocated under Government's Ten-year Plan. In order to compete effectively for additional public funding, it has to be clearly demonstrated how rail can contribute to the achievement of Government's economic, environmental and social objectives.

  The Directions and Guidance need to be clear about priorities of their intended policy objectives. For example, the target of an increase of 50 per cent in passenger kilometres in clause 5.6 of the draft directions and guidance contrast to the specific outcome listed in 5.7 which requires a 50 per cent increase in passenger journeys overall. An increase in intercity usage might result in more passenger kilometres. However, an increase in shorter passenger journeys may make a greater contribution to reducing road congestion.

  There is concern within the Committee network that the targets do not distinguish between encouraging more travel per se and encouraging modal shift. The Rail Passengers Council would emphasise the need for the latter. Measures to encourage the already travelling public to do so by rail should be supported by selected investment throughout the country.

  Railtrack's analysis in its Network Management Statement 2001 suggests that a 1 per cent growth in train kilometres leads to an increase in delays of up to 2.5 per cent "creating significant challenges in maintaining punctuality in congested parts of the network." (2001 Network Management Statement Part One, Ch 4, p17). Targeting bottlenecks and increasing capacity has to be a cornerstone of any plan to increase passenger kilometres through more services.

  As currently written, the directions and guidance targets are likely to encourage SRA resources to be focussed on the areas of high population density and existing passenger usage which have the greatest scope for capacity enhancement in order to improve the national figures. Furthermore, the emphasis on passenger kilometres would suggest a focus on long-distance interurban services. Whereas this may be utilitarian to a point, there are parts of the network where improved local services could greatly increase rail usage in that area, help reduce town centre congestion in some places or help tackle social exclusion in others. As stated in the Rail Passengers Council's recent paper The SRA's Strategic Agenda—Informing The Strategic Plan (July 2001), there has to be full engagement with the question, "What are the railways for?"

Providing the framework for major infrastructure enhancement projects to be taken forward now that Railtrack is to focus on the maintenance and renewal of the existing network

  The Rail Passengers Council welcomes the recognition of Railtrack's inability to deliver major enhancements at present. However, this is largely because funds previously earmarked for development have been diverted to maintenance of existing infrastructure.

  The future funding of enhancements needs to be addressed and the effects on the 10-year plan targets confronted. Unless the quality and the capacity of the infrastructure is improved there will be few benefits capable of being delivered. If overcrowding is to be reduced this implies more trains, longer trains or both. The first requires more track capacity, the second longer platforms. Both need Railtrack to deliver.

  It is fundamental to franchise extensions and franchise replacements alike that they "provide a base to move forward". It is paramount that any two-year extensions underpin the long-term vision for the railway. Long-term planning should not be postponed for short-term gain.

Transforming the SRA's leadership of the industry, its day-to-day management of franchises and the way in which it assesses and awards new and extended contracts for passenger services

  OPRAF's hands-off approach to regulation was widely criticised, and there is concern within the RPC network that "minimal restrictions" on operators do not always work in the best interests of passengers. Regulation is designed to step in where commercial incentive or monopolistic practices work against the interest of the consumer, and, in these cases regulation should not be seen as "restrictions" to commercial creativity, but as baseline standards of conduct and accountability.

  There is concern that the SRA must become more proactive in identifying failings at the local level and enforcing franchise conditions. The action which the Authority is required to take if a franchise operator or franchisee breaks the terms of the franchise agreement are set out in sections 55-58 of the Railways Act. The Rail Passengers Council would like these measures be strengthened. Franchise replacement may, of course, strengthen the terms of the agreement eventually.

  The Rail Passengers Council welcomes the guidance that the Authority should ensure that a proper basis has been established for proposals for new or replacement franchises to be evaluated. In particular the proposals that the SRA should "provide at a reasonably early stage, clear information on the scope of the specification that will be acceptable" and that this will be determined "primarily by the availability of funding, taking into account the Authority's overall priorities for its budget." This should avoid the chalk and cheese comparisons highlighted by Virgin/GNER for the East Coast and should ensure that bids are realistic.

Improving the poor state of industrial relations in the railways

  The RPC Network recognises that industrial relations are for companies themselves to manage. However, passengers have suffered a great deal recently from industrial action—both official and unofficial—and train companies should not exempt themselves from the requirement to compensate passengers for delays and cancellations caused by such action.

  One Rail Passengers Committee suggests that the SRA should set a target for new franchisees to reach agreement with their workforces on a means of resolving industrial disputes, and that efforts to reach agreement with unions on binding arbitration or no-strike agreements could be made a condition of new franchises.

September 2001

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