• Our booking engine at tickets.railforums.co.uk (powered by TrainSplit) helps support the running of the forum with every ticket purchase! Find out more and ask any questions/give us feedback in this thread!

Northern franchise to end 1 March 2020 with Operator of Last Resort to take over

Status
Not open for further replies.
Sponsor Post - registered members do not see these adverts; click here to register, or click here to log in
R

RailUK Forums

JaJaWa

Established Member
Joined
14 Feb 2013
Messages
1,704
Location
Detailed article from the Guardian: https://www.theguardian.com/business/2020/jan/29/northern-rail-franchise-to-be-renationalised

Northern rail franchise to be renationalised
Decision by transport secretary, Grant Shapps, comes after years of cancellations and delays


Gwyn Topham and Lucy Campbell
Published: 21:13 Wednesday, 29 January 2020

The Northern rail franchise is to be renationalised, the government has announced, with the state operator of last resort taking over the running of the struggling network from 1 March.

The decision by the transport secretary, Grant Shapps, will be welcomed in the north after years of widespread cancellations and delays for passengers.

The Northern franchise has been run by Arriva since 2016 but the operator’s ambitious plans to modernise and expand train services have given way to a grim reality of worsening punctuality and reliability, and a failure to achieve promised improvements.

Northern rail passengers least satisfied in the UK

Northern argues that many of the factors were out of control, such as postponed infrastructure upgrades that affected the rollout of more electric trains, leading to the prolonged retention of the infamous Pacer trains. Meanwhile, a long-running dispute with the RMT union led to widespread strikes.

Shapps announced earlier in January that Northern’s finances meant that the current franchise arrangement could only last months and he was considering the best option for the taxpayer and passengers. However, he decided against accepting proposals from Arriva for a short-term management contract, which northern transport authorities had described as a “reward for failure”.

The decision means that the Conservatives have nationalised two major rail franchises in less than two years, after taking over the East Coast line in June 2018, now run as LNER after the collapse of Virgin Trains East Coast. Shapps last week admitted that the future of another, South West Railway, was in doubt, after the First Group-MTR joint venture said it was running out of cash. Questions also hang over the TransPennine Express and West Midlands Trains franchises.

Renationalisation is unlikely to have immediate implications for staff or the travelling public. Virtually all employees are likely to be retained – at LNER, even the management team from Virgin remained in place – and operational problems will persist. However, the decision will be more palatable to unions, northern politicians and passengers, who have demanded action to improve services.

Unions warned that Northern would need “significant investment” to turn it round. Mick Whelan, the general secretary of Aslef, the train drivers’ union, said: “We welcome today’s decision because we want the railway in public ownership but let’s do it properly, with a clear, long-term, strategic vision, not just as a short-term response to the years of franchised failure.

“There won’t be an immediate improvement because many of the systemic failures at Northern cannot be remedied overnight.”

A root-and-branch review of the rail industry, which will recommend replacing the current system of franchising, has been completed by the former British Airways boss Keith Williams but is yet to be published by the Department for Transport.

Northern is the biggest franchise in the country by the length of its route network and serves more than 500 stations in England north of Derby. It also receives the biggest state subsidy for its operations, running at £763m last year, including indirect funding for track access.

Passengers in Manchester had few good words to say for Northern but were mixed in their view of whether nationalisation would help.

Simon Kendall, 45, a freelance IT consultant, said his 30-minute commute from Littleborough to Salford Central is often “nothing but appalling”, with trains often delayed, cancelled or overcrowded, with fewer carriages than usual. “I was on a train last year and rain was coming in through the roof, and newspapers were used to mop up the water.”

However, he said: “I’m not sure whether public ownership will work unless they decide to invest in the infrastructure. Northern rail has had no real investment for years and it’s a service that is used heavily by the public. Why spend money on HS2 when it’s the local rail networks that really need investment? Northern transport has been neglected for far too long.”

Ursula Katz, 75, who travels three times a week from Hebden Bridge into Manchester to look after her grandchildren, said her service was often delayed or cancelled, especially at weekends: “The trains only run hourly and then they’ll cancel it and you have to wait an hour for the next one, and then it’s standing only.”

She said: “I’m all for nationalisation of the trains. These franchises make life difficult for commuters, profit a lot and don’t reinvest. I hope that nationalising will make things better.”
 

Mathew S

Established Member
Joined
7 Aug 2017
Messages
2,167
Confirmed on BBC breaking. No link to an article yet
The gist of the situation would seem to be that the franchise was no longer financially viable, with Arriva claiming this is due to infrastructure problems that Network Rail won't solve, and the DfT blaming Arriva - thus no prospect of a management contract being awarded.
There will be an article shortly, but give the poor guy a few minutes to write it :)
 

thenorthern

Established Member
Joined
27 May 2013
Messages
4,103
Nationalisation was inevitable although I think the Department for Transport is to blame more than anyone else.
 

a_c_skinner

Established Member
Joined
21 Jun 2013
Messages
1,576
March, eh? If I were in charge of the OLR I'd be putting the bite on CAF to have as many new trains as possible in service. The rest will take a long time. More 319s? Should be easy to at least have enough spares, well spare.
 

LNW-GW Joint

Veteran Member
Joined
22 Feb 2011
Messages
19,556
Location
Mold, Clwyd
The buck will stop with DfT (as it always has, really).
No detail yet.
Fascinating to see what the Mayors and TfN do now.
Will they get a say in how things run?
Which blameless railwayman will get the hospital pass to run things for OLR?
 
Last edited:
Joined
25 Jan 2016
Messages
541
Location
Wolverhampton
Here is the full written statement, by Grant Shapps as laid in the Commons: copied directly from the House Papers app.

Wherever you live, you deserve a railway that widens your children’s horizon, gives you access to highly skilled, highly paid jobs, and provides a viable green alternative to getting in your car.

For too long, millions of rail passengers in the north of England have not had that. They have had to start and end their working day facing cancellations and delays. Some stations, particularly on Sundays, have been left without trains for hours on end.

It’s no surprise that passengers have lost trust in the north’s rail network. The service provided by the rail network in the north has failed to meet the needs of passengers. People across the north deserve better, their communities deserve better and I am determined to achieve that.

In January I announced that the Northern franchise was no longer financially sustainable and would only be able to continue for a small number of months. I am announcing today that from 1st March the Northern Rail franchise will be taken into public ownership and the Government will begin operating services through the public-sector operator - the so-called operator of last resort.

The public-sector operator is a company entirely owned by my Department and run by experienced railway managers. It already owns and oversee another franchise, East Coast, which it brands as London North Eastern Railway. Passenger satisfaction has risen in the nineteen months it has been operating the service.

This is a new beginning for Northern, but it is only a beginning. Northern's network is huge and complex, some of the things which are wrong are not going to be quick or easy to put right. Nonetheless, I am determined that Northern passengers see real and tangible improvements across the network as soon as possible.

The roll out of new trains that’s already begun under Northern will continue and Pacers will be banished very soon on the western side of the Pennines. In Yorkshire, Pacers will be gone by the spring and next year, we will move electric trains from elsewhere on the network to the north, boosting capacity for commuters into Manchester and Leeds.

We know overcrowding is a problem. To ensure we are deploying the trains in the right place to meet demand, we will be trialing new technology to identify crowding pinch points. We will also be extending platforms at 30 stations on the Northern network to allow for longer trains.

We will also be making sure that every journey is made on a train fit for passengers: all Northern's trains will be deep-cleaned and we will review the cleaning pattern to make sure the first and last passengers travel on trains in the same condition.

Over many months we have seen completely unacceptable numbers of cancellations on Sundays, affecting town centres, businesses, families and community groups. We understand this and I have therefore asked the public-sector operator to prioritise building on the recent agreement with ASLEF to improve the reliability of Sunday services and significantly reduce the number of cancellations.

Beyond this, I have asked Robin Gisby and Richard George, who lead the public-sector operator, to prepare a plan in their first 100 days, to make sure we leave no stone unturned in improving this franchise for passengers.

Improvements can’t be delivered in isolation, so the public-sector operator will work hand in hand with Network Rail to make sure the railway delivers as one, with a single-minded focus on the interests of the passenger. As part of this a newly-created cross-industry North West Recovery Task Force, co-ordinated by Network Rail, will deliver recommendations on how best to boost capacity and performance in the short, medium and longer term.

Many of Northern's problems are due to inadequate infrastructure. That, too, must change - though inevitably it will take longer than some other improvements. I have instructed the leadership of the public-sector operator to sit down with Network Rail and build a comprehensive new masterplan to review congestion around Manchester. Continuing to assess the Castlefield Corridor, as well as key junctions and interactions across the wider network to develop a series of interventions which will actually deliver the improvements required. This will complement the work already ongoing to develop an ambitious package of enhancement works at Leeds Station.

The vast majority of Northern's trains pass through Leeds or Manchester, often picking up delay as they do. Improving the railway in these cities will have knock-on effects for passengers across the North of England.

The action we're taking today is in no way a reflection on Northern's dedicated and hard-working staff. Staff have had an incredibly tough job to do in challenging circumstances. I want to reassure them that their jobs are safe and they will be transferred to the public-sector operator on their existing terms and conditions. I recognise that many of the staff facilities are not up to scratch and have asked the public-sector operator to look closely at making improvements.

I would also like to be clear that the only differences passengers should notice is services gradually starting to get better. All tickets, including season tickets, will still be still valid.

Today’s announcement will inevitably raise questions about the future of rail privatisation. Over the past twenty years privatisation has reversed over two decades of declining passenger numbers and passenger journeys have almost doubled to nearly 2 billion.

However, it is clear that the current model is now struggling to deliver. Across the country a number of franchises are failing to provide the reliable services that passengers require. We know change is needed, and it is coming. The Williams Review is looking at reforms across the railway to ensure customers are at the heart of the system.

The railways were invented in the north of England and last year the Prime Minister promised that we would give the railway back to the places it was born. With local leaders having more power over local services, timetables, fares and stations. Today marks the first small step in that journey. The first step towards the north taking back control of its railways and its people taking back control of their travelling lives, and its economy being strengthened rather than weakened by its transport network.

There will be no more leaving behind, this Government is committed to levelling up.
 

Muenchener

Member
Joined
31 May 2018
Messages
142
Forgetting the well documented infrastructure issues; how is an OLR going to address the fleet conversion training and ensure enough qualified people are available to resource the Northern (or whatever it becomes) services?
 

WesternLancer

Established Member
Joined
12 Apr 2019
Messages
6,997
Of course unlimited govt resources available when it comes to Gaurds dispute (provoking the desire to rush through the legislation banning all out strikes etc).
 

WesternLancer

Established Member
Joined
12 Apr 2019
Messages
6,997
Here is the full written statement, by Grant Shapps as laid in the Commons: copied directly from the House Papers app.
all Northern's trains will be deep-cleaned and we will review the cleaning pattern to make sure the first and last passengers travel on trains in the same condition.

That would be a good outcome alone if done well!
 

The Prisoner

Member
Joined
22 Aug 2012
Messages
323
Split operations into North East, Yorkshire and North West and devolve power to set delivery standards and service patterns to the TPE(s) and/or local councils in each zone then bring in a private management contract for each responsible to the new TfNE, TfY and TfNW just as Merseytravel does with what was the old Merseyrail Electrics franchise.

Those bidding for the management contracts will price their "profit" into management costs rather than greedily bidding for franchises on false numbers for shareholders.
 

47421

Member
Joined
7 Feb 2012
Messages
654
Location
london
The Dec 2015 Franchise Agreement includes the definition of Funding Deed and Guarantor per below. Anyone know who the Guarantor is? Another member of the Arriva / DB group I expect but I cant see which company in particular. And anyone know what the total guaranteed amount was (know as the subordinated loan/funding in some franchises)?


“Funding Deed” means the deed made between the Secretary of State, the Franchisee and the Guarantor dated on or about the date of the Franchise Agreement specifying arrangements relating to the funding for the Franchisee by the Parent and giving rights to the Secretary of State in relation to such funding;


“Guarantor” has the meaning given to such term under the Funding Deed;
 

packermac

Member
Joined
16 Sep 2019
Messages
543
Location
Swanage
So far, media reports have omitted reference to Arriva and DB. Sloppy reporting?
Well unless they mention that DB is foreign, which may annoy some, but is probably not something the government will sing about two days before "Brexit day" who is going to really care anyway?
 

Nicholas Lewis

Established Member
Joined
9 Aug 2019
Messages
5,996
Location
Surrey
Here is the full written statement, by Grant Shapps as laid in the Commons: copied directly from the House Papers app.

Dept of Transport link here https://www.gov.uk/government/speeches/a-passenger-focused-railway

Some salient points

The roll out of new trains that’s already begun under Northern will continue and Pacers will be banished very soon on the western side of the Pennines. In Yorkshire, Pacers will be gone by the spring and next year, we will move electric trains from elsewhere on the network to the north, boosting capacity for commuters into Manchester and Leeds
Thats taking credit for Northerns existing plans.

As part of this a newly-created cross-industry North West Recovery Task Force, co-ordinated by Network Rail, will deliver recommendations on how best to boost capacity and performance in the short, medium and longer term.

Many of Northern’s problems are due to inadequate infrastructure (recognition at last). That, too, must change - though inevitably it will take longer than some other improvements. I have instructed the leadership of the public-sector operator to sit down with Network Rail and build a comprehensive new masterplan to review congestion around Manchester. Continuing to assess the Castlefield Corridor, as well as key junctions and interactions across the wider network to develop a series of interventions which will actually deliver the improvements required.
That sounds like delay and prevarication on Castlefield decision

However, it is clear that the current model is now struggling to deliver. Across the country a number of franchises are failing to provide the reliable services that passengers require. We know change is needed, and it is coming. The Williams Review is looking at reforms across the railway to ensure customers are at the heart of the system
So why is he sitting on the Williams review

With local leaders having more power over local services, timetables, fares and stations. Today marks the first small step in that journey. The first step towards the north taking back control of its railways and its people taking back control of their travelling lives
Maybe an indication of what Williams will say
 

LNW-GW Joint

Veteran Member
Joined
22 Feb 2011
Messages
19,556
Location
Mold, Clwyd
Arriva has issued a statement on loss of the franchise, including this apology:
“We recognise however that overall service improvements have not come quickly enough, and passengers deserve better. For that, we wholeheartedly apologise.
We now stand ready to support Government and the Operator of Last Resort to ensure a smooth transfer for our passengers and colleagues alike.
https://news.arriva.co.uk/news/statement-on-northern-franchise

Looks like they are not going to argue.
Even so, the financial settlement will be interesting, given there are claims and counter-claims on the reasons for financial failure.
 

Bantamzen

Established Member
Joined
4 Dec 2013
Messages
9,680
Location
Baildon, West Yorkshire
Split operations into North East, Yorkshire and North West and devolve power to set delivery standards and service patterns to the TPE(s) and/or local councils in each zone then bring in a private management contract for each responsible to the new TfNE, TfY and TfNW just as Merseytravel does with what was the old Merseyrail Electrics franchise.

Those bidding for the management contracts will price their "profit" into management costs rather than greedily bidding for franchises on false numbers for shareholders.

On the face of it this might sound like a good idea. However the PTEs are not split as simply as North West, Yorkshire & the North East. Splitting the franchise to suit the PTE structures would require Merseyside & South Yorkshire sub-groups too. And then there are the areas not covered by PTEs...

If the franchise is to be split, it should only be done so on the basis of operational need, i.e. North West & Yorkshire / North East groups, but overseen as a whole by TfN. Anything else will lead to fighting amongst the various PTEs and local councils on who gets what & where, with the main two cities probably getting the lion's share of the say. Not a good way to start to make positive changes.

Arriva has issued a statement on loss of the franchise, including this apology:

https://news.arriva.co.uk/news/statement-on-northern-franchise

Looks like they are not going to argue.
Even so, the financial settlement will be interesting, given there are claims and counter-claims on the reasons for financial failure.

I for one am not surprised, Arriva / DB will probably be breathing a sigh of relief that they have been given a get-our clause. Of course this will all but see off Arriva from any future franchise bids, and along with the other franchise groups that have failed or are failing, really ought to see off the whole franchise model. You would hope....
 

WesternLancer

Established Member
Joined
12 Apr 2019
Messages
6,997
So far, media reports have omitted reference to Arriva and DB. Sloppy reporting?
Hard to know -n you might think that people would note some sort of irony in 'nationalising' as the press describe it, a service already run by a state run company...albeit another state.
 

Wombat

Member
Joined
12 Jul 2013
Messages
299
There's an assertion in one of the BBC article's comments that a franchise handed over to OLR has to be franchised off again when it becomes profitable. I don't think anyone expects Northern to turn a profit in the foreseeable future but, just out of interest, is that assertion correct?
 

squizzler

Established Member
Joined
4 Jan 2017
Messages
1,903
Location
Jersey, Channel Islands
If Arriva challenge it in the courts, presumably they retain the franchise as that plays out? Much like minicab firm Uber seem to keep running whilst their challenge to TfL licence refusal plays out in the courts?
 

LOL The Irony

On Moderation
Joined
29 Jul 2017
Messages
5,335
Location
Chinatown, New York
This is just sticking a plaster that's lost it's stickiness on an gaping wound. Making it seem like there will be change when there will be little to none.
 

Darandio

Established Member
Joined
24 Feb 2007
Messages
10,674
Location
Redcar
If Arriva challenge it in the courts, presumably they retain the franchise as that plays out? Much like minicab firm Uber seem to keep running whilst their challenge to TfL licence refusal plays out in the courts?

But there is absolutely zero chance of that happening. This is the result they wanted.
 
Status
Not open for further replies.

Top