ATW £170m railway franchise is "flawed"

[tbtc]

Its easy to renationalise if the will is there, you just wait to all the franchises come up for renewal and not let them out again, NR is already in reality nationalized and as far as rolling stock is concerned anything new is bought by the state company OK it will take a while to flush ROSCO's out but it wont cost a penny.

...for the UK Government, yes (hypothetically).

But that doesn't mean that the WAG would be able to control the Wales & Borders franchise. The whole thing is a non-starter.

 

[ChiefPlanner]

State ownership is one thing, but the WAG directly controlling a franchise which involves a reasonable amount of running in England would never work.

On top of which around 30% of passenger flows are cross-border , and are the higher yield earning ones also - important to the revenue flow of the operation.

Cross - border flows into Scotland - none operated by Scotrail of any consequence (and the sleeper is high cost / lowish revenue) are the most valuable flows into the area. Transport Scotland has no jurisdication over these , as WG has none (bar consultation) on FGW, XC , LM and Virgin)

Can anyone explain to me please , how a not for profit franchise really works. ?

A cost plus + management fee operation , in which case , who is going to bid for it ?

 

[tbtc]

Can anyone explain to me please , how a not for profit franchise really works. ?

A cost plus + management fee operation , in which case , who is going to bid for it ?

The problems with the current ATW franchise seem to be because of politicians/ civil servants (ATW are basically running the franchise that they said they would - they never promised dozens of new trains...).

People's "solution" to this? To hand the entire franchise over to politicians/ civil servants...

 

[Lampshade]

Very much agree with this......but weren't there a number of obstacles put in the original privatisation deal that would make it almost impossible (costly) for the railways to be re-nationalised? The Tories knew that they were going to lose the 1997 election......

Not difficult, just award the franchise to a WAG-owned company on a commercial basis. It just so happens said company may choose, if they wish, to run the franchise not-for-profit.

Can anyone explain to me please , how a not for profit franchise really works. ?

A cost plus + management fee operation , in which case , who is going to bid for it ?

Instead of profits going to shareholders, all profit is reinvested into the franchise or cross-subsidised with other WAG-funded areas, such as education. Basically, all profit remains within the state institutions.

 

[ChiefPlanner]

Not difficult, just award the franchise to a WAG-owned company on a commercial basis. It just so happens said company may choose, if they wish, to run the franchise not-for-profit.



Instead of profits going to shareholders, all profit is reinvested into the franchise or cross-subsidised with other WAG-funded areas, such as education. Basically, all profit remains within the state institutions.

Which gives the WG the total responsibility for safety , performance and all the other comeercial risks concerned. Fine.

Anybody know a civil service / Government that wants this repsonibility. Back in the days of BR , the Dept of Transport was always carefull enough to keep an arms length relationship , - no civil servants for example were hauled in over the Clapham crash and the subsequent enquiry. BR stood alone, and the Chairman took full responsibility on the spot almost - compare that to post privatization events.

 

[merlodlliw]

Not difficult, just award the franchise to a WAG-owned company on a commercial basis. It just so happens said company may choose, if they wish, to run the franchise not-for-profit.



Instead of profits going to shareholders, all profit is reinvested into the franchise or cross-subsidised with other WAG-funded areas, such as education. Basically, all profit remains within the state institutions.

But the state institutions, rob Peter to pay Paul, so in effect WAGRAIL profits ship across to Education etc as above, the railway will loose its profit for reinvestment, it always happens.
--- old post above --- --- new post below ---

Not difficult, just award the franchise to a WAG-owned company on a commercial basis. It just so happens said company may choose, if they wish, to run the franchise not-for-profit.

I was not aware WG owned any Companies outright, can you name some,out of interest.

Bob

 

[Squaddie]

But the state institutions, rob Peter to pay Paul, so in effect WAGRAIL profits ship across to Education etc as above, the railway will loose its profit for reinvestment, it always happens.

I don't think there is anything inherently wrong with profits from one state-owned enterprise being used to finance another; this is not "robbing Peter to pay Paul" but merely proper use of public funds. The danger, as you say, is that the government might continue the long-standing practice of under-investment in the railways and use the money raised from fares on other favoured projects. This is always a risk, but I would hope that a government that cares enough to take on the running of a railway would also care enough to invest properly in that railway. In this regard, the biggest threat is from right-wing governments, who have a long-standing ideological aversion to public transport. (It was, after all, a Conservative government that gave us this fractured, inefficient and expensive network that is the worst of all possible privatisation options).

But this is all academic because, as others have said, it is simply not feasible for the Welsh Government to take control of the Welsh rail network.

 

[tbtc]

I don't think there is anything inherently wrong with profits from one state-owned enterprise being used to finance another; this is not "robbing Peter to pay Paul" but merely proper use of public funds

There would be no profits though.

The whole point of this thread is that fact that "ATW received the highest public subsidy per passenger mile of any franchise across the UK".

So if the WAG took the franchise on, they'd be taking that loss.

There are many reasons why the Wales & Borders franchise isn't profitable, and they can't all be blamed at Arriva's profit margin.

 

[Gareth Marston]

They want to base it on the Welsh Water Dwr/Cymru model http://www.dwrcymru.com/

Welsh Water was a failed privitisation and when it got into trouble the not for profit model emerged. It is run by a board of directors on not for profit basis by a holding company called Glas Cymru. So is arms length of Civil servants/politicians. It also supplies parts of western England so the precedent for cross border is already set.

 

[anthony263]

They want to base it on the Welsh Water Dwr/Cymru model http://www.dwrcymru.com/

Welsh Water was a failed privitisation and when it got into trouble the not for profit model emerged. It is run by a board of directors on not for profit basis by a holding company called Glas Cymru. So is arms length of Civil servants/politicians. It also supplies parts of western England so the precedent for cross border is already set.

I personally think if the WG think that this model would be better than what is currently happening now and it saves money then I say let them try.

You never know it could work and I suspect the scots will be keeping a close watch

 

[ChiefPlanner]

There would be no profits though.

The whole point of this thread is that fact that "ATW received the highest public subsidy per passenger mile of any franchise across the UK".

So if the WAG took the franchise on, they'd be taking that loss.

There are many reasons why the Wales & Borders franchise isn't profitable, and they can't all be blamed at Arriva's profit margin.

The preceding Wales and West and Valley Lines TOC's , if anyone cares to back check the financial records prove that for sure. No chance of it being strictly "commercial" - bar a few route sections.

Prism gave them up to NX for that reason. I dont see comments on those "unsustainable" franchises.

It is not easy - but WG could , if it wanted to , amend the franchise agreements for more service levels it it wanted to. I suspect revenue support as opposed to infrastrcuture support is going to be tighter in future. Not just for Wales , but for the UK. McNulty looks at reducing industry costs by around a billion a year.

That is the context we work in.

 

[merlodlliw]

They want to base it on the Welsh Water Dwr/Cymru model http://www.dwrcymru.com/

Welsh Water was a failed privitisation and when it got into trouble the not for profit model emerged. It is run by a board of directors on not for profit basis by a holding company called Glas Cymru. So is arms length of Civil servants/politicians. It also supplies parts of western England so the precedent for cross border is already set.

In effect its Like Network Rail, when Railtrack went bust ( Network Rail is a British "not for dividend" entity, technically a private company limited by guarantee, whose principal asset is Network Rail Infrastructure Limited, a company limited by shares.)

I am not so sure this model will work in transport, an interesting point, Wrexham Water as a private Company was never Nationalised & Supplies water to Wrexham/Flintshire & Chester, now called Dee Valley Water.

Network rail own all the track, it would be interesting to see how this could be set up, and GMPTE are involved in Manchester.

 

[Greenback]

I think that the franchise is flawed, and has been since it was drawn up in rather a hurry!

Of course, it will never be profitable in the traditional sense, but a lot of revenue must be lost on the Valleys network, as for a start it is difficult to collect all fares on off peaks ervices formed of two Pacer units.

 

[anthony263]

Here is an interesting news article:

http://www.walesonline.co.uk/news/w...1466-29770205/#sitelife-commentsWidget-bottom

As for the Brackla station - Something I think is needed although I read that there wasn't enough time for Maesteg services to call at Brackla, however I did also read somewhere that if the Swansea - Cardiff swanline services were run using emu's it would cut journey times by 5-7 minutes which would be enough to make an additional call at the new station in Brackla.

 

[LNW-GW Joint]

Here is an interesting news article:

http://www.walesonline.co.uk/news/w...1466-29770205/#sitelife-commentsWidget-bottom

This is the Network Rail version:
http://www.networkrailmediacentre.c...ENS-FOR-BUSINESS-1924/SearchCategoryID-7.aspx

I'm still not entirely clear where the Wales route begins and ends up here.
I thought the Chester PSB area was staying in the LNW Route but I could be wrong.

Gowerton doubling is evidently committed, but Saltney-Wrexham is not (yet).