TOC contract expiry dates

[HSTEd]

ORR needs to be removed from the equation no longer relevant in a nationalised railway.

We aren't really going to have a truly nationalised railway.

The governments desire to allow freight and open access operators to continue as they are now means the entire bureaucracy of today must be retained.

We will, de-facto, have the status quo except OLR running all the franchises.

 

[LNW-GW Joint]

Also interesting that in her final speech about integrated transport, Louise Haigh compared transport in Chester and Dijon, both being cities of similar size.
Dijon has a fully integrated transport system, Chester does not.
But she acknowledged that the Dijon system was run under contract by private sector Keolis, so ownership is not the primary difference.

The comparison isn't entirely valid, as Dijon is a historic but isolated regional capital, while Chester, similarly endowed historically, has two megacities on its doorstep (Manchester and Liverpool), and another nation with different priorities in its western suburbs.

 

[Goldfish62]

We aren't really going to have a truly nationalised railway.

The governments desire to allow freight and open access operators to continue as they are now means the entire bureaucracy of today must be retained.

We will, de-facto, have the status quo except OLR running all the franchises.

There aren't going to be any franchises. The whole industry is going to be restructured, just as it was in the mid 80s and again with privatisation.

Most people would regard Germany's railways as nationalised, despite having a multitude of contracted and open access operators. The same goes for most European rail networks.

 

[LNW-GW Joint]

The Statement to the House on taking back TOCs will already have been written so unless there is a No 10 inspired change of policy (unlikely), it will just be given by the new man/woman in charge.
If it isn’t given on Monday/Tuesday of next week, the widely tipped dates, then it gets more interesting.

It might provide an opportunity for reviewing the pace of the TOC termination plan.
Heidi, I suspect, is not as "lefty" as Louise, in terms of private sector involvement in the railway.
She certainly will have experience of dealing with the unions.
I note Mick Lynch regrets Louise's departure.

 

[185]

Sure it's mentioned but Heidi Alexander is the replacement, an interesting selection.

Edit .. in post above

 

[Goldfish62]

Sure it's mentioned but Heidi Alexander is the replacement, an interesting selection.

Edit .. in post above

An excellent selection. She'll hit the ground running.

 

[Nicholas Lewis]

It might provide an opportunity for reviewing the pace of the TOC termination plan.
Heidi, I suspect, is not as "lefty" as Louise, in terms of private sector involvement in the railway.
She certainly will have experience of dealing with the unions.
I note Mick Lynch regrets Louise's departure.

Sensible course of action now is getting a single person in to lead/run shadow GBR who can execute the govts vision and until thats done there is no point moving over anymore operators to OLR as they will achieve very little.

 

[duffield]

Sensible course of action now is getting a single person in to lead/run shadow GBR who can execute the govts vision and until thats done there is no point moving over anymore operators to OLR as they will achieve very little.

Even if passing them to OLR results in a temporary no-change situation until GBR is set up, at least it means the payments to the commercial operator (commission is it, or a fixed fee? I forget how it works now) will cease, either saving the taxpayer money or allowing that money to be spent more productively.

 

[HSTEd]

There aren't going to be any franchises. The whole industry is going to be restructured, just as it was in the mid 80s and again with privatisation.

There will be a franchise analogue in the new organisation (even if only one), because someone has to participate in the existing processes on behalf of the state.
If they do not the existance of freight operators and open access operators will trigger inevitable state aid legal challenges on "level playing field" principles.
The government could attempt to remove those principles, but I don't see a feasible method to do so without destroying the OAO/FOC business model.

Most people would regard Germany's railways as nationalised, despite having a multitude of contracted and open access operators. The same goes for most European rail networks.

Well Germany's system operates on fundamentally the same bureaucratic basis as the UK's one did before coronavirus. It merely opted for DB to die a slow death by a thousand (franchising) cuts, ditto SNCF, rather than the fast death imposed on BR.

 

[Nicholas Lewis]

Even if passing them to OLR results in a temporary no-change situation until GBR is set up, at least it means the payments to the commercial operator (commission is it, or a fixed fee? I forget how it works now) will cease, either saving the taxpayer money or allowing that money to be spent more productively.

Maybe but bet Treasury will take any benefit.

 

[LNW-GW Joint]

Sensible course of action now is getting a single person in to lead/run shadow GBR who can execute the govts vision and until thats done there is no point moving over anymore operators to OLR as they will achieve very little.

GBR does have a single Chair: Laura Shoaf - though it's not clear what powers she has, and has made no statements yet.

Even if passing them to OLR results in a temporary no-change situation until GBR is set up, at least it means the payments to the commercial operator (commission is it, or a fixed fee? I forget how it works now) will cease, either saving the taxpayer money or allowing that money to be spent more productively.

The external money saved will go on the new GBR bureaucracy...
The real savings will come when TOCs/NR Regions/DfT are merged and jobs are lost in the process.

 

[duffield]

GBR does have a single Chair: Laura Shoaf - though it's not clear what powers she has, and has made no statements yet.


The money saved will go on the new GBR bureaucracy...
The real savings will come when TOCs/NR Regions/DfT are merged and jobs are lost in the process.

"The money saved will go on the new GBR bureaucracy..." and if so, *that* money would otherwise either have had to come from the taxpayer or from other parts of the rail budget, so still worthwhile fully nationalising ASAP to get hold of that money.

 

[Nicholas Lewis]

GBR does have a single Chair: Laura Shoaf - though it's not clear what powers she has, and has made no statements yet.

It needs a CEO to drive things forward not a SoS who called herself passenger in chief thats the job of the CEO.

The external money saved will go on the new GBR bureaucracy...
The real savings will come when TOCs/NR Regions/DfT are merged and jobs are lost in the process.

That is years away from being realised but nothing stopping savings being made now ie suspend Sch 8 payments its just a money go round and still a source of unnecessary bickering and mgt time. Oh and i don't mean eliminate determining why train performance is below expectations that still required.

 

[HSTEd]

It needs a CEO to drive things forward not a SoS who called herself passenger in chief thats the job of the CEO.

That is years away from being realised but nothing stopping savings being made now ie suspend Sch 8 payments its just a money go round and still a source of unnecessary bickering and mgt time. Oh and i don't mean eliminate determining why train performance is below expectations that still required.

The expensive part of the money go around is the determining of fault, though.

Moving money from one box to another and back again costs essentially nothing in the modern era.

 

[Nicholas Lewis]

The expensive part of the money go around is the determining of fault, though.

Moving money from one box to another and back again costs essentially nothing in the modern era.

disputing attributions is what cost time and money. the attribution staff aren't in the top dollar end of earners and will still provide the raw information to help drive overall performance.

the other thing that could go far more easily is Sch 4 thats a wooden dollar cost which makes enhancement projects look expensive.

 

[HerneHill]

disputing attributions is what cost time and money

Real talk - there have been literal hundreds of millions of pounds spent on overpriced consultants and lawyers to file (and defend) Sch8 over the years… I’ve seen the ridiculous fees and settlement amounts!

 

[Dr Hoo]

Real talk - there have been literal hundreds of millions of pounds spent on overpriced consultants and lawyers to file (and defend) Sch8 over the years… I’ve seen the ridiculous fees and settlement amounts!

I don't know how long you've been in the industry but I really am surprised by this claim. I was extensively involved in many aspects of performance data, targeting, attribution, the Schedule 4 and Schedule 8 regimes, Delay Attribution Board and so on until I retired some years ago and never saw much evidence of consultants and lawyers involved on the payments side - mainly automated every four weeks.

There was some high level lawyer involvement in development of the documentation, so that it fitted suitably with track access agreements, Network Code, Delay Attrition Guide and so on. This tended to be occasional, e.g. around Periodic Reviews, rather than continuous.

I have seen very little evidence in things like tenders, job advertisements, TOC accounts and so on that amount to the scale that you are suggesting. I presume that the commencement of DfT 'micromanagement' from March 2020 would have brought an end to this scale of expenditure in any event.

Can you provide any more detail in support?

 

[Clarence Yard]

I have never ever heard of lawyers (or expensive consultants) being involved in day to day schedule 8 and I have only been involved in it, concerning several TOCs, for the last nearly 30 years.

Who is actually doing this or are we talking about yet another railway myth? Names, please.

 

[HerneHill]

I retired some years ago and never saw much evidence of consultants and lawyers involved on the payments side - mainly automated every four weeks.

I have never ever heard of lawyers (or expensive consultants) being involved in day to day schedule 8 and I have only been involved in it, concerning several TOCs, for the last nearly 30 years.

You are both quite right, it was rather facetious of me to just throw out a comment like that which at face value reads as if it related to day-to-day Sch4/8 disputes and settlements!

I won’t go into too much specifics, but let’s just say there are clauses in the respective Schedules that allow TOCs to make some very huge revenue loss claims far above and beyond what the formulaic calculations would output.

NR had settled a couple of these out of court (you won’t find any records) for tens of millions of £s each, with specialist lawyers and consultants on retainer on both sides racking up millions in fees over the years it took to build the cases, argue them, dispute what the number should be, etc…

It’s not anywhere near like-for-like vs the settlements taking place via the routine Sch4/8 process, granted - but it’s what thoroughly convinced me of how perversely misaligned the incentives were under the franchising system. All that senior management effort and money could have been so much better spent on fixing the underlying issues to improve service delivery for the passenger, rather than exploiting arcane contractual terms to make a quick buck through legal wizardry.

I presume that the commencement of DfT 'micromanagement' from March 2020 would have brought an end to this scale of expenditure in any event.

Yup, the gravy train did end following the EMAs!

 

[Clarence Yard]

Yes, schedules 4 and 8 do have these clauses but they tip you into the world of commercial claims and then they are hellishly difficult to prove. Most operators don’t bother because of the cost of doing so, especially as NR Claims is incredibly slow and prone to getting into huge levels of detail, some of which a TOC cannot answer, due to the black box nature of some of the systems used.

I know of one TOC who did pursue one but didn’t spend millions on it. It was high five figures and they got an offer because NR was keen not to set a precedent. These kind of big claims were really, really uncommon - perhaps one every few years.

But this isn’t normal schedule 4 or 8.

 

[Adrian1980uk]

Just to point out, the delay attribution system and costs / revenue loss claims will continue and potentially with less contractual reference but more vigor as although it will be the same organisation, GBR, it will be moving between budgets. Take the example of an Easton region director (however tran services are split up), I have my P&L to manage and go and explain my regions finances, if I can get extra 'revenue' from the infrastructure budget or FOC that's caused me to pay out delay repayment then I'm going to pursue that.

 

[vuzzeho]

today's the day, isnt it? do we know when the announcement is coming?

 

[jackdoyle]

today's the day, isnt it? do we know when the announcement is coming?

If a statement was being made to the House of Commons today it would have been confirmed by now. There is something from the Home Secretary and one from a Foreign Office Minister but nothing from DfT. So i'm guessing tomorrow.

 

[LNW-GW Joint]

There's supposed to be a major announcement on Thursday 5th about government targets (by Kier Starmer).
It's conceivable that the timescale for taking back TOC contracts could be part of that.
Heidi Alexander will want to be very sure that the schedule her predecessor was going to announce is manageable by her DfT.
A rebranding of DOHL/OLR is also expected.

 

[Clarence Yard]

Really interesting that no announcement was made yesterday or today, as these were the expected days, due to something else rail related being slated for Thursday.

We will see if it all gets bundled up on Thursday or there has been some reprogramming!

 

[Doctor Fegg]

FT is reporting South Western Railway is to be nationalised in May.

South Western Railway set to be first train operator nationalised by Labour

Next companies to return to public control will be c2c and Greater Anglia under UK government plans

www.ft.com

The UK government plans to take South Western Railway into public ownership in May, in the first nationalisation of the country’s passenger rail network under Sir Keir Starmer’s Labour administration. Plans for ministers to step in once the contract by FirstGroup and MTR to run the SWR network expires in May will be announced as early as Wednesday, according to two people with knowledge of the details.

 

[HerneHill]

FT is reporting South Western Railway is to be nationalised in May.

South Western Railway set to be first train operator nationalised by Labour

Next companies to return to public control will be c2c and Greater Anglia under UK government plans

www.ft.com

Bottom of the article says DfT apparently declined to comment - seems this is a leak of sorts?

 

[markle]

FT is reporting South Western Railway is to be nationalised in May.

South Western Railway set to be first train operator nationalised by Labour

Next companies to return to public control will be c2c and Greater Anglia under UK government plans

www.ft.com

As an SWR commuter, I have to say I'm somewhat unclear as to how this will benefit me or the service being delivered.
As I understand from much of the parallel discussions on here, the issues around, say, service frequency, are down to the DfT's service specification. I'm not clear how transitioning to public ownership actually makes anything better, except maybe making subsequent and unspecified reform easier.

 

[setdown]

Delightful news. The only way is up. According to RecentTrainTimes, over the past six months, my SWR train is on time 5% of the time. Now a change of management may not be the panacea to the abysmal performance on the South West mainline, but a change is needed nonetheless.

 

[Sir Felix Pole]

Bottom of the article says DfT apparently declined to comment - seems this is a leak of sorts?

'Guardian' reporting it also.

SWR

South Western Railway will be the first train operator nationalised under the Labour government, ministers are expected to announce this week.

One of the UK’s biggest commuter services, which operates out of London Waterloo, it will be taken into public hands in May.


SWR is currently run as a joint venture between First Group and MTR, the Hong Kong rail operator.

The decision will spell a more cautious timeline for renationalisation under new transport secretary Heidi Alexander than envisaged by her predecessor, Louise Haigh, who resigned last week.