dk1
Veteran Member
Did I hear them say they'd brought in some geezer from John Lewis to look at a similar partnership structure? Well the thought of an extra bonus to boost our salary would get my vote
Did I hear them say they'd brought in some geezer from John Lewis to look at a similar partnership structure? Well the thought of an extra bonus to boost our salary would get my vote
That is correct and confirms the Tories love a John Lewis connected man, with Andy Street winning the West Midlands Mayoralty last May!
Despite there profit becoming nil in the first half of 2018, JL is still a strong company of whom it’s lead people know what it takes, to run such an organisation and the DfT needing its bosses help is probably the smartest move.
Regionalising it could work.
How about a
Intercity sector.
Freight sector
Regional Railways sector
Scotrail sector
Network SouthEast sector.
Oh yeah they did that and it worked.
Or even one big operator that is divided in to:
Southern Region.
London Midland Region.
Eastern Region.
Western Region.
Scottish Region.
Oh yes .. did that too and it worked but didn't make money for the mates of MPs.
The announcement that the DfT is considering yet another "fundamental review" of the UK's rail architecture was, perhaps, an inevitable response to a summer of timetable problems amidst the populist appeal of Labour demands for full-scale renationalisation of the sector.
Should it happen, this will be the third such review since 2010. It is therefore worth re-visiting its predecessors to remind ourselves of their recommendations and to check progress.
Review 1.0 – McNulty
A product of the 2010 government's broad desire to control public spending after the 2008 crisis, and chaired by Sir Roy McNulty, the long-serving and respected former Chairman of the Civil Aviation Authority, the 2011 review was focused initially on the objective of reducing or at least containing the growth in rail costs.
McNulty's remit was quickly diluted, and the final report contained two key recommendations:
1. Less prescriptive franchises for TOCs
2. More decentralisation (to regional elected mayors, and within Network Rail).
In 2018, the TOCs find themselves in precisely the opposite position, with ever more closely specified contracts, that remove almost all cost flexibility, and leave TOCs as vessels of blame whenever operational or financial conditions are unfavourable.
Thanks to George Osborne, there has been substantial movement towards strong regional governance. Unsurprisingly, these newly empowered transport authorities now seek the kind of detailed control over rail services increasingly exercised by TfL.
As to the Report's primary objective – a pathway towards a 20-30% reduction in the railway's unit costs, there has been no detectable progress. McNulty chose to leave the pre-existing economic architecture in place, and to rely on friendly exhortations for the industry to try harder and deliver more. Without any economic reform, the upward pressure on industry staff costs has continued and intensified, spilling over into disruptive strikes intended to bolster the political case for nationalisation, and [presumably] future pay increases to be met by the taxpayer. Far from reducing costs, Network Rail has presided over astonishing cost over-runs, but has met its objective of remaining a unified entity [although asset sales have now resumed in order to shore up the corporation's cash position].
Review 2.0 Shaw
The 2015/16 Nicola Shaw Review started more promisingly, with a commitment to examine serious structural reforms. This economics-based agenda was once again diluted, and the final recommendations were even more meagre than McNulty's - comprising motherhood-and-apple pie commitments to the centrality of passengers, and vague exhortations in the direction of further devolution. Once again, NR remained intact, and the TOCs remained holders of short term franchises, with diminishing flexibility and huge exposure to economic and political fluctuations.
Given the intellectual seriousness of the Shaw group, it was impossible not to see this as anther victory for the rail industry 'blob' – that coalition of change-resistant vested interests first identified by Michael Gove in the education sector. Within UK rail, the blob consists of the rail unions, parts of industry management, some incumbent companies and suppliers, and elements of the civil service. Equity investors and HM Treasury stand somewhat outside this group, but are also cautious about major change.
Both reports were undertaken by serious people, of good standing, and with relevant expertise. The ease with which any proposals for serious structural change were watered down, even before publication says much about the power of the rail blob, and the caution of politicians.
What's changed since 2016?
The previous reviews floundered on the DfT's unwillingness to carry out fundamental changes to the economic structure of Network Rail, or to amend the role of the TOCs. Indeed, political pressure on DfT has led to ever greater contractualisation of train operations, placing the TOCs into the position of becoming passive receivers of economic and political risk, with none of the flexibilities enjoyed by either 'normal' private businesses or regulated utilities.
Both McNulty and Shaw came down in favour of exhorting efficiency improvements, without the harsh medicine of structural change.
Even more alarmingly for the Tories, the huge investments in capital projects and intensified timetables they have funded have resulted in real and visible hardship for passengers. Whatever the medium-term benefits, Thameslink's shiny new trains, and Northern's recast timetable, are now associated with passenger disruption and Tory 'cuts' [when in fact, spending has occurred at massive levels].
This political problem goes far beyond the rather technocratic objectives of the first two reports.
Labour's plan suffers from no such caution. They have the advantage of clarity, and build on misconceptions that are shared much more broadly than Labour's newly radical base. These include:
1. A confusion between profit and dividend
2. The [largely false] idea that TOC owners have enjoyed high and or stable financial returns
3. The failure to see a linkage between the UK rail industry's difficulty in controlling unit costs, and the growth in passenger fares
4. The implied suggestion that fares will be subsidised much more heavily by taxes on a broader population [many of whom rarely travel by train]
This kind of woolly thinking is not confined to the quasi-Marxist left, which now makes up Labour's activist base, and polling suggests quite widespread support for a state-owned railway network. The implied leap in spending will surely be funded by the undefined 'rich' who will 'be asked to pay a little more in taxes'.
Grayling's second emerging problem is that rail demand is now showing the first significant secular weakness since the mid 1990s. No unambiguous trends are yet apparent, but one possibility is that technology changes, such as the ease of home working and shopping, are finally eroding peak demand. This could be fundamental, given that rail spending [and over-spending] has for some time been justified by the idea that constant increases in rail capacity are inevitable and desirable.
Grayling therefore faces problems on multiple fronts:
1. A change resistant industry, whose major actors are beneficiaries of the current arrangements
2. Sceptical equity investors, who now publicly wonder why UK-listed companies should participate in an industry in which returns have been meagre, but where investors are regularly accused of profiteering
3. A persuasive opposition, with strong support from trades unions and passenger groups who anticipate [probably correctly] that nationalisation would benefit both employees and passengers at the expense of the non-travelling tax-payer
4. A cautious Prime Minister, whose economic views, so far as they are known, lean towards centrist interventionism, rather than Thatcherite reform
5. Passengers, media and voters who allocate responsibility to the government, and not the industry
Given the government's meagre parliamentary strength, it would be unwise to anticipate proposals for truly fundamental reform, let alone much subsequent progress on the ground.
Change is only likely to occur if it is forced through, probably on a local basis, and probably over a protracted timescale.
God help us if it ends with greater government control.
Without turning this into another nationalisation vs privatisation debate. Every dealing I've had with the DfT and the Civil Service in general give me no confidence on their ability to successfully manage anything.
When BR was nationalised there was little or no government control. BR negotiated a budget with the DfT and then was allowed to get on with it. Imagine what BR could have done if it had had the levels of funding that the so called private operators get today in the form of subsidy.
When BR was nationalised there was little or no government control. BR negotiated a budget with the DfT and then was allowed to get on with it. Imagine what BR could have done if it had had the levels of funding that the so called private operators get today in the form of subsidy.
That is correct and confirms the Tories love a John Lewis connected man, with Andy Street winning the West Midlands Mayoralty last May!
Despite there profit becoming nil in the first half of 2018, JL is still a strong company of whom it’s lead people know what it takes, to run such an organisation and the DfT needing its bosses help is probably the smartest move.
We'll said! Go back to the old sectors. Far better to offer a standard product rolling stock wise and to stop these silly procurements of small multiple fleets that are all mostly incompatible with each other.
When BR was nationalised there was little or no government control. BR negotiated a budget with the DfT and then was allowed to get on with it. Imagine what BR could have done if it had had the levels of funding that the so called private operators get today in the form of subsidy.
When BR was nationalised there was little or no government control. BR negotiated a budget with the DfT and then was allowed to get on with it. Imagine what BR could have done if it had had the levels of funding that the so called private operators get today in the form of subsidy.
Your history is a bit vague...When BR was nationalised there was little or no government control. BR negotiated a budget with the DfT and then was allowed to get on with it. Imagine what BR could have done if it had had the levels of funding that the so called private operators get today in the form of subsidy.
Your history is a bit vague...
BR was not nationalised, it was the private companies that were nationalised.
Good old nationalised British Rail had plenty of small fleets - we can't blame privatisation for things like the 81/82/83/84/85s can we?
OK! Point taken.Sorry I should have phrased that a bit better - what I mean't was "when we had a nationalised railway under BR"
Imagine what BR could have done if it had had the levels of funding that the so called private operators get today in the form of subsidy.
A sweeping review to transform Britain’s railways has been launched today (20 September 2018) by Transport Secretary Chris Grayling.
The review — the most significant since privatisation — will consider ambitious recommendations for reform to ensure our vital rail system continues to benefit passengers and support a stronger, fairer economy.
The review — led by independent chair Keith Williams, the former British Airways chief executive and deputy chairman of John Lewis Partnership — will build on the government’s franchising strategy — bringing track and train closer together to reduce disruption and improve accountability, and considering regional partnerships and how we can use innovation to improve services and value for money for passengers.
Keith Williams will be supported by an external panel and will report next year. The government will publish a white paper on the review’s recommendations, with the implementation of reforms planned to start from 2020.
The panel will consider all parts of the rail industry, from the current franchising system and industry structures, accountability, and value for money for passengers and taxpayers.
The panel membership will include Roger Marsh, who chairs the body representing the 11 local enterprise partnerships in the north of England and will bring his expert knowledge and experience of business and transport needs across the north of the country.
Privatisation has led to a level of growth never seen under nationalisation, and reversed the decline the railways saw under British Rail, where routes and stations were closing.
Passenger journeys have more than doubled -— from 735 million in 1994-5 to 1.73 billion in 2016-17. Private investment is at record levels, totalling £5.6 billion over the past 10 years, and the rail network has one of the highest rates of satisfaction and safety in Europe.
However, the industry has not kept pace with this significant growth, shown as the industry struggled to deliver for passengers following the May timetable disruption.
The government has already taken steps to strengthen future train franchises and improve reliability. However, we want to ensure the rail system continues to deliver benefits in the face of these challenges.
The review will analyse all aspects of the industry, alongside the country’s changing travel and work patterns. It will make recommendations to improve the current franchising model in terms of reliability, delivering better services and value for money for passengers, commercial sustainability and innovation.
The review has been launched ahead of the interim report by Professor Stephen Glaister into the timetabling issues in May. It will it take into account the findings of his final report at the end of the year.
Transport Secretary Chris Grayling said:
Privatisation has delivered huge benefits of passengers on Britain’s railways — doubling passenger journeys and bringing in billions of private investment.
But it is clear that the structure we inherited is no longer fit to meet today’s challenges and cope with increasing customer demand. Following the disruption this summer we took immediate action to improve services and ensure the industry compensated passengers.
We’ve been clear that the railway needs reform to prioritise its passengers, and we have set out plans for closer partnerships between operators of track and train, including on the LNER and South Eastern networks.
But as part of our vision for the future of mobility, we need to go further and more quickly, to get the best from the public and private sectors and deliver the railway we need for the 21st century. It is vital that this review leaves no stone unturned and makes bold recommendations for the future.
I am delighted that Keith Williams — who has significant experience leading businesses within the transport sector — has agreed to be the independent chair of this review. His expertise in driving customer service excellence will be incredibly valuable as we seek to reform the rail industry to become more passenger focused.
The review has a wide scope and will focus on:
While the review is taking place, the government will continue with its ambitious programme of investment — £48 billion over the next 5 years.
- leveraging the commercial model to ensure improved services for passengers and taxpayers, and more effectively balance public and private sector involvement
- the roles and structures of all parts of the industry, looking at how they can work together more effectively to reduce fragmentation, improve passenger services and increase accountability
- how the railway can support a fares system that delivers value for money for passengers and taxpayers; and improved industrial relations to maintain performance for passengers
Keith Williams said:
It’s clear that Britain’s railway has seen unprecedented growth and is carrying more passengers than it did a century ago on a network a fraction of the size. But it also clear it faces significant challenges.
I am looking forward to working with the industry and passengers to tackle these challenges.
While the review is underway, the department will work closely with industry to ensure that rail delivers the day-to-day performance and transformational improvements that passengers expect.
The government will set out the terms of reference of the review and the membership of the panel when Parliament returns. The Transport Secretary has asked that the review engages with a wide range of stakeholders in all parts of the country, including passenger representatives, businesses, and local and devolved bodies and governments.
The department has reviewed all ongoing franchise competitions and other live rail projects in the context of the rail review. Due to the unique geographic nature of the Cross Country franchise, which runs from Aberdeen to Penzance and cuts across multiple parts of the railway, awarding this franchise in 2019 could impact on the review’s conclusions.
It has therefore been decided that this competition will not proceed. Services will continue to be operated by the existing franchisee with options beyond this to be considered in due course. The department will consider the responses to the Cross Country public consultation in the development of future options for the franchise.
All other ongoing franchise competitions and other live rail projects are continuing as planned.
Yeah. I'm not particularly bothered about nationalisation, I "just" want a single point of accountability that removes perverse incentives for anti-passenger behaviour.The lack of vertical integration and joined up thinking is killing it at the moment. Look at the recent timetable debacle - who was mostly responsible for that? No one knows because they can all conveniently point the finger of blame at each other. Who loses out the most? The passenger of course.
Well, hopefully the new CEO will make some changes, but he has only been in the job a month...Just what the industry needs. More highly paid executives who talk the talk buzz words and all. Significant challenges never seem to prevent these parasites collecting their gongs and executive bonuses for a job well done. Even though in most cases, it's not well done at all. And so we have another enquiry so lessons are learned, more quangos and more overpaid executives.
If the CEO of Network Rail was really doing his job, he wouldn't put up with the mess of scrap metal, rails and ballast which is dumped line side by the organisation and its contractors. Shoddy maintenance and lack of leadership.
I've found an answer for you here...Who is this Arrival that everybody keeps talking about?