Examination of Witnesses (Questions 20
TUESDAY 20 NOVEMBER 2001
20. What do you think are the reasons for the
current delay in creating the Wales & Borders franchise?
(Mr Brown) That is a question which really should
be addressed to the SRA. From our perspective, we have submitted
our initial replacement proposals, we have been short-listed along
with three other parties. Clearly funding is an issue and that
is one which has been communicated to us, but we have not received
any formal notification since February of this year as to where
the Wales & Borders re-franchising process has got to.
21. But you are a deeply interested party. One
would think if you were following things closely you might have
some view as to the reason for the delay.
(Mr Gibb) It has to be said that we have created the
Wales & Borders train operating company over the last few
months. It has now been operating for just over a month and during
that period we have transferred a significant number of staff
around, we have made a significant number of organisational changes
and we have managed to sustain train performance and safety during
that period. What has been achieved in the last six months must
not be underestimated and we now have trains and stations all
over Wales with the new company name highly prominent. Already
people are beginning to identify with the new train operator in
22. You have the company but you do not have
the franchise. Why do you think it has been delayed?
(Mr Gibb) That is a question best asked of the SRA
who are responsible for that process.
23. You have made clear that you like the idea
of a two-year extension as the best way forward now. Bearing that
in mind, what is the earliest realistic date from your point of
view for establishing the Wales & Borders' franchise?
(Mr Gibb) Through a competition or through an extension?
24. The complete franchise.
(Mr Gibb) In terms of bringing in all the component
parts, I would imagine that it would be possible to bring in the
North Wales operation of First North Western in September next
year. It would then be complete under its current arrangements.
In terms of the sale process, I would expect an extension deal
could be concluded within a few weeks. In terms of a competition,
it would take substantially longer.
25. You have answered this, but just to make
it absolutely crystal clear, you believe that it is preferable
to continue with a shadow franchise for Wales & Borders and
Wessex for two to three years so that a proper franchise can be
let on a sound financial basis after that. Is that fair?
(Mr Brown) Yes.
26. What are the provisions now being made to
ensure railway companies participate in multi-modal travel schemes
outside London? Are those provisions included in the new contracts
which are being entered into?
(Mr Pheasey) The new contracts being the new franchise
(Mr Pheasey) We do not yet know the final form of
the new franchise agreement. That is one of the issues the SRA
are struggling with: what the terms and obligations within that
will be. In terms of co-operation with the multi-modal ones, we
are already co-operating with a smart card experiment in the Caerphilly
area. Where such schemes are developed, we would wish to participate
and would do so willingly. We do see that it is generally best
led by the local authorities as an initiative, with us participating
as one of the component parts. Bus operators equally have to be
(Mr Gibb) We have pulled together over the last couple
of years a product called Freedom of Wales Flexipass. This is
the promotional material for it which is a pass available primarily
aimed at tourists for the whole of Wales, providing travel on
most bus operators and all rail operators and indeed most private
steam railways as well. It is a product which has been very successful
and has brought a real integrated type of ticketing to tourism
visits to Wales. There is plenty of precedent of work which has
been done, entirely off our own back rather than through compulsion.
28. This includes integrated timetables and
changeovers between buses and trains. One of the issues that raises
in Mid Wales particularly is where there is a failure with the
train system and a service does not run and replacement buses
are put on, they do not call at every station and people are left
at stations. Are people looking at this?
(Mr Gibb) On the Heart of Wales line, which I think
is the one you are referring to, it is a particular challenge
to run a substitute bus service, basically because the buses are
too large to reach the majority of the stations down the country
lanes and to turn round. What we normally do is operate a bus
service which calls at the larger stations and a parallel taxi
service which serves the smaller stations and the taxi service
meets up with the bus and transfers the passengers at stations
along the line. Not surprisingly, given the rural nature of that
railway, at very short notice, when the line is closed, such as
a couple of days ago when a lorry ran into a bridge at Builth
Wells, it is very difficult to get road transport at a moment's
notice. Buses and drivers are not sitting around ready to respond
to that, so it is a difficulty. Obviously my objective is to run
trains 100 per cent of the time reliably.
29. Given the present structure of the railways,
do you think it is possible to have a modern efficient railway
in Wales under the present financial arrangement?
(Mr Gibb) That would depend on your definition of
a modern efficient railway. I believe that even compared with
many other parts of Europe we do run a modern efficient railway
and the rural railways which we run in Wales are certainly comparable
with rural railways elsewhere in Europe.
30. Sir Alistair Morton said recently in evidence
to the Transport Sub-Committee, that there was no point getting
the money if you did not have the right structure in place. What
in your view is the right structure for Wales?
(Mr Gibb) I have to answer that by saying that even
with the existing structure there is a lot I could do with additional
funding. I could solve most of the overcrowding issues, I could
solve most of the punctuality issues, I could bring about a step
change in station environments, all to a very short timescale
were the funding available.
31. So you disagree with what he said.
(Mr Gibb) I do not disagree, but I do believe it is
possible to achieve a great deal within the existing structure.
My challenge and that of all my colleagues in the industry, has
been to work with whatever structure has been in place. We have
faced a number of different structures in the last ten years.
32. What should be the priorities for the SRA
in your opinion?
(Mr Brown) Just to finish off the last answer, where
Sir Alistair was coming at was some of the issues around Railtrack.
We will work within whatever structure. Moving on to your question
on the issue around the priorities for the SRA, clearly addressing
the issues around Railtrack is crucial. A second issue for the
SRA is to provide the strategic leadership the industry needs;
obviously a key priority for the new Chairman, Richard Bowker.
A third area has to be to secure the funding, the issues around
the Government's ten-year plan, which is a plan we applaud, but
we need to have the momentum put in behind that which is clearly
an issue of funding.
33. It has been suggested that Scotrail might
operate as a vertically-integrated company, both managing the
infrastructure and operating the trains in Scotland. Do you think
that is a viable model for Wales?
(Mr Brown) It has been suggested. It has not been
suggested by National Express Group. We are the current franchisees
for Scotrail. Scotland has lent itself to observers as a possible
pilot. There are certain parallels between Wales and Scotland.
Clearly some issues around a single operator, co-terminus geography,
co-terminus geography as far as the Railtrack operation and track
maintenance are concerned, would lend themselves to Wales being
a possible area where this could be tried.
34. How has the Railtrack zonal structure been
re-organised to reflect a Wales and Borders franchise?
(Mr Gibb) The zone structure has been changed by the
transfer of the Cambrian and Cambrian coast routes into the Great
Western zone managed from Swindon and by the planned further location
of management resources from Swindon to Cardiff in the near future.
The North Wales activity from Wrexham northwards remains under
the control of Railtrack North West located in Manchester.
35. How does the state of the railway infrastructure
in Wales compare with the rest of the UK?
(Mr Gibb) I would say that the railway infrastructure
in Wales has been steadily improving over the last ten years.
I can recollect situations in the early 1990s where the infrastructure
faced many, many issues much greater than those today. In terms
of our type of railway, the infrastructure improvement has been
steady over that period. Obviously we have faced the issue that
every other part of the national network has faced over the last
12 months and those issues have impacted seriously on our ability
to run a punctual railway. In Wales it has been no different to
that elsewhere in the country. The underlying trend in Wales has
been one of steady improvement.
36. Where in your operation are there still
infrastructure requirements and how much money will they cost?
What sort of funding do you need?
(Mr Gibb) There is a very long list of the infrastructure
enhancements we should like to see. I suppose I could sum those
up by saying that infrastructure enhancements currently planned
by the Strategic Rail Authority called incremental output statements
are intended to provide increased capacity, increased reliability
on certain routes. There is a long list of those, of which approximately
23 involve our company and we are very keen to see all 23 of those
incremental outputs progressed in the near future. They include,
for example, a capacity enhancement on the route from Newport
up to Crewe to allow more trains to run on the line through Leominster
and to accommodate more freight trains on that route. That is
one of the incremental output statements for that area. Several
projects have been proposed by the National Assembly for Wales.
One of those, for example, is the creation of a passing loop at
Dovey Junction to allow an hourly service to operate between Aberystwyth
and Shrewsbury. We very strongly support that initiative. If you
take into account all the initiatives and if they are all done
in the immediate future within a five-year timescale, I should
be delighted. That would bring about a radical improvement in
the services we are able to run in Wales and an improvement in
the reliability and performance. As to how much it would cost,
to give you an idea, the National Assembly is currently proposing
to spend £55 million over the next five years on projects
in Wales. The total cost of the incremental output statements
is not a figure I have to hand, but I can provide it separately
if you wish. I would guess that the two together add up to in
excess of £100 million across the Wales & Borders network.
37. Is that all?
(Mr Gibb) That is for those schemes which are currently
in the pipeline. I should be delighted and in a realistic frame
of mind that would make a very big change to the services we were
able to operate. Clearly there are things I should like to see
beyond that. That is a pragmatic and realistic ambition for the
38. From what you said, clearly the enhancements
are very welcome, but would you agree with the statement that
the railways in Wales do not need major infrastructure enhancements
to facilitate increased use of the network?
(Mr Gibb) That depends on what level of increase you
would like to see. I have just touched on a range of improvements
which I would say in the total expenditure of things, when compared
with a dual carriageway or a motorway extension and things like
that, is a modest form of improvement which would bring about
a big increase in capacity and reliability. However, we have previously
outlined our proposals for a 20-year franchise and that involves
a significant increase in lines, way beyond that level of expansion
to provide new services. There are schemes that we should like
to achieve in the longer term, such as the re-opening of the railway
to Ebbw Vale; in the short term lines like the Vale of Glamorgan
which we believe will now be funded and will now be completed.
In terms of re-opening old railway lines, and one which is often
suggested is the line from Carmarthen to Aberystwyth, realistically
there is little hope of that sort of initiative in the foreseeable
39. What about improving the quality of the
line west of Cardiff to Swansea and beyond?
(Mr Gibb) The line between Cardiff and Swansea particularly
is generally of a pretty good standard. A section of that will
be re-signalled in the immediate future from an old 1950s signalling
system which hopefully will give us improved flexibility, the
re-opening for passenger use of the Vale of Glamorgan line by
Barry will provide an alternative route as well and additional
capacity which will be very welcome. When you get west of Swansea
it does become a little more challenging. There is a lengthy section
of single track between Swansea and Llanelli which impacts on
reliability and punctuality and the ability to run more trains.
There are issues there but there is a lot we can do with the existing
infrastructure. We can run longer trains, we can run train services
for longer hours into the evenings and on Sunday. A lot can be
done on the existing infrastructure.