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


Memorandum by The Railway Forum (PRF 20)

PASSENGER RAIL FRANCHISING

INTRODUCTION

  The Railway Forum, the industry-wide body with a membership drawn from all constituent parts of the railways has taken a close interest in the two draft policy statements issued by DTLR in Passenger Rail Franchising and Directions and Guidance to the SRA. The Railway Forum responded in detail to the two documents.

  Overall we welcomed the draft Directions and Guidance re-affirmation of the Government's commitment to growth and improvement in the railway industry and the very clear direction for the SRA to produce its long awaited strategic plan no later than November 2001. We were also keen to reiterate that the industry fully recognises it has to deliver value for money solutions but that increasingly demanding safety, environmental and other legislative standards such as disability provision produce burdens that must be shared between the industry, the fare paying traveller and the tax payer. All concerned must work closely together to ensure that we deliver what passengers and freight customers want by means of the most cost-effective solutions. We cannot stress strongly enough that this can only be achieved with the closest cooperation between the industry and its regulators.

PASSENGER FRANCHISE POLICY

  On the specific issues of passenger franchises our position is that the present draft direction represents a pragmatic way forward. It is however only a short-term response to meet a particular set of circumstances. We therefore strongly support the proposal contained in the draft policy statement that, once the immediate rationalisation phase is over, a process re-linking major investment with longer-term franchises must start as soon as possible. Unless this is done substantial private sector investment and the achievement of long-term growth will both be put in jeopardy.

INVESTMENT

  Our concerns with the draft Directions and Guidance were particularly focussed on the issue of guaranteeing investment. We were disappointed that Section 8 of the draft did not focus sufficiently strongly on the practicalities of developing and delivering the SPV concept. We wanted to see a clearer direction to the SRA to resolve the key issues of creating SPV procedures that are realistic, deliver to time and are cost-effective. The Railway Forum is considering a range of options to ensure that the SPV's develop successfully and we will be publishing our findings shortly.

  In parallel we remain disappointed to see that the Rail Modernisation Fund, that seemed so promising in the 10 Year Plan, is still a long way from fruition. Overall, we considered that the investment dimension had been underplayed. It should be a specific objective that the SRA should maximise the effectiveness of Government funding and create and attractive environment for commercial investment.

BRITAIN'S RAILWAYS AND EU DIRECTIVES

  A further major concern that is not specifically covered in the points you raise for consideration is the very significant impact EU directives and other policies will have on the further development of the railways in the United Kingdom. If handled well these will help us in our objective of bringing Britain's railways up to the best European standards. If we do not get our strategies right we could find ourselves having to take on inappropriate legislation that does not best meet the needs of the industry or those who use it.

CONCLUSION

  We are conscious in making this submission that there are many issues that will only become clear over the next few months. These include taking the widest view of the impact of the tragic events of 11 September on our national economy, the handling of transport funding in the Government's current Comprehensive Spending Review and the outcomes of the Lord Cullen's Second Report. In addition, the significant changes that have occurred as a consequence of the recent franchise policy developments are still working their way through the industry. We hope that over the next few weeks some parts of this complex jigsaw will begin to fall into place. We are therefore ready to provide further evidence if required by the Sub-Committee.


 
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