Is the West Coast Partnership franchise just plain silly?

[Up_Tilt_390]

The West Coast Partnership franchise will replace the InterCity West Coast franchise in 2019, and the winning operator is expect to work with HS2 Ltd. to provide the first services on High Speed 2. Now this idea in itself isn't silly, even if you're for or against HS2, but that's not what this discussion is about. What I find plain silly is the fact the Department for Transport set a requirement for the operator to have experience in operating high speed trains and infrastructure.

I find this silly because no operator in the UK has that experience, and the closest you'll get is Eurostar with operating high speed trains. I doubt even the DfT who were behind the WCML franchise shambles in 2012 are that ignorant to this fact, but basically the only way to win the franchise is to partner with a European or Asian high-speed operator, so it's basically asking for more of our railways to be sold off to foreign companies, which means less investment in our railways and more for theirs.

Aside from the fact that's quick easy money for the Tories, who for some reason seem to have gained a fetish for privatisation after Thatcher even despite some industries now being in a right mess because of it, I can't see any justifications for this requirement. I think if anything it'd be better to just set the requirement that operators must have experience at operating 100-125mph high-speed trains. That's how Eurostar select their drivers.

But I want your two cents on the whole franchise and whether you think it's a shambles. If you have any points to add to mine or would like to address some of them then of course go ahead, just don't be rude about it which I'm sure most of you won't be anyway.

 

[Bletchleyite]

Nothing stopping a UK bidder with a minority stake from a foreign company with HS experience. Indeed, that's precisely how the Virgin/Stagecoach bid is working, isn't it?

 

[talltim]

Depends how you define high speed.
Plenty of high speed in the UK by the UIC definition

Category I – New tracks specially constructed for high speeds, allowing a maximum running speed of at least 250 km/h (155 mph).
Category II – Existing tracks specially upgraded for high speeds, allowing a maximum running speed of at least 200 km/h (124 mph).
Category III – Existing tracks specially upgraded for high speeds, allowing a maximum running speed of at least 200 km/h (124 mph), but with some sections having a lower allowable speed (for example due to topographic constraints, or passage through urban areas).

 

[Up_Tilt_390]

Nothing stopping a UK bidder with a minority stake from a foreign company with HS experience. Indeed, that's precisely how the Virgin/Stagecoach bid is working, isn't it?

The Virgin/Stagecoach bid is working as Stagecoach with 50%, SNCF with 30%, and Virgin with 20%. Even though 70% is owned by British companies, the French are still getting 30% more than I'd like. It's not that I'm a Little Englander who despises outside influence, but in a British industry that's suppose to offer a public service to the British people I don't like it when it's sold to foreign companies. We have different demands. Even a minority stake is all just to fulfill a silly requirement, which is ultimately what the thread's about.

 

[Up_Tilt_390]

Depends how you define high speed.
Plenty of high speed in the UK by the UIC definition

Category I – New tracks specially constructed for high speeds, allowing a maximum running speed of at least 250 km/h (155 mph).
Category II – Existing tracks specially upgraded for high speeds, allowing a maximum running speed of at least 200 km/h (124 mph).
Category III – Existing tracks specially upgraded for high speeds, allowing a maximum running speed of at least 200 km/h (124 mph), but with some sections having a lower allowable speed (for example due to topographic constraints, or passage through urban areas).

I believe that the requirement is of Category I. Wikipedia lists the requirement as 250mph, but I think it's a typo and actually means 250km/h, which fits Category I. No operator in the world has 250mph experience except perhaps China. Speed records may or may not count.

 

[JamesT]

The Virgin/Stagecoach bid is working as Stagecoach with 50%, SNCF with 30%, and Virgin with 20%. Even though 70% is owned by British companies, the French are still getting 30% more than I'd like. It's not that I'm a Little Englander who despises outside influence, but in a British industry that's suppose to offer a public service to the British people I don't like it when it's sold to foreign companies. We have different demands. Even a minority stake is all just to fulfill a silly requirement, which is ultimately what the thread's about.

How else would you propose a prospective franchisee gaining experience of high speed?
Bear in mind this is only really a requirement for one franchise. When the following franchise comes up (and I suspect the WCML and HS2 are split), you'll now have UK staff with HS experience.

 

[Up_Tilt_390]

How else would you propose a prospective franchisee gaining experience of high speed?
Bear in mind this is only really a requirement for one franchise. When the following franchise comes up (and I suspect the WCML and HS2 are split), you'll now have UK staff with HS experience.

My plain and simple answer is that you don't. I'd say simply have the operators have experience operating Category III high-speed trains which is up to 125mph but with slower speeds on some portion of the line, but that's all. Every operator - the Japanese, the French, Germans, Italians etc - have all started from the exact same position when it comes to high speed rail. Since our franchisees won't have the burden of operating the infrastructure that goes with it, it isn't really asking for much.

 

[Bletchleyite]

It's 30% more than I want SNCF (or for that matter FS, RENFE or any of the other Romance style operators) owning anything. But I'd be happy with DB AG or one of the Japanese operators.

 

[Up_Tilt_390]

It's 30% more than I want SNCF (or for that matter FS, RENFE or any of the other Romance style operators) owning anything. But I'd be happy with DB AG or one of the Japanese operators.

Yes, I believe you said this in a separate thread when I first brought up the idea. You said it was because of similar demands if I remember correctly?

 

[6Gman]

Aside from the fact that's quick easy money for the Tories, who for some reason seem to have gained a fetish for privatisation after Thatcher even despite some industries now being in a right mess because of it, I can't see any justifications for this requirement. I think if anything it'd be better to just set the requirement that operators must have experience at operating 100-125mph high-speed trains. That's how Eurostar select their drivers.

In what way is this "quick easy money for the Tories"?

 

[Taunton]

The whole idea behind tying the WCML operator to HS2 is to stop whoever is the WCML operator when HS2 opens from offering express services from London to Birmingham at fares which undercut Hs2 sufficiently to take much of their traffic. It will be bad enough that Chiltern will compete on these grounds, let alone a second operator, leaving from the same place as HS2 in London (in fact notably closer to the Underground) to a more convenient place in Birmingham.

Do South East trains from St Pancras to Ashford not operate at 140 mph?

 

[LLivery]

Honestly, I'd be surprised if a private operator for HS2 actually happens.

 

[LLivery]

In what way is this "quick easy money for the Tories"?

The largest Tory donors (who are also voters) tend to have the largest investments... Keep them happy, keep the funding going.

 

[Up_Tilt_390]

In what way is this "quick easy money for the Tories"?

Because there's lots of money to be made from selling off our industries to foreign firms. This has happened tremendously over the past few years, and it's brought in nice short term cash for the economy. Unfortunately, neither the present Conservative or previous Labour Government thought about the long term, and it won't be so dandy in the end.

 

[Up_Tilt_390]

The whole idea behind tying the WCML operator to HS2 is to stop whoever is the WCML operator when HS2 opens from offering express services from London to Birmingham at fares which undercut Hs2 sufficiently to take much of their traffic. It will be bad enough that Chiltern will compete on these grounds, let alone a second operator, leaving from the same place as HS2 in London (in fact notably closer to the Underground) to a more convenient place in Birmingham.

Do South East trains from St Pancras to Ashford not operate at 140 mph?

Yes, Southeastern do operate 140mph trains on High Speed 1, but technically this doesn't qualify them because of the lack of operating the infrastructure in which they run on. I can see the reason why the operators of WCML and HS2 might be made to be the same, but I made it clear that's not what I found silly. It's the fact that every franchisee now needs to bring in a foreign company to run some of our trains because of a requirement they won't meet on their own.

 

[Bald Rick]

I think you misunderstand franchising, and are conflating two points: what the franchising process actually does, and what franchisees bring to the process.

This isn't selling off anything. It is inviting organisations to pay us (the UK taxpayers, via Government) for the right to run train services on the WCML for the specified time. Whoever provides the best value combination (a balance between highest offer and best quality) will get that right.

Why shouldn't we seek experience from other parts of the world for something we haven't done much of? It's the whole point of international trade and co-operation is to improve your own country and generate wealth by using the experience of others.

 

[6Gman]

The largest Tory donors (who are also voters) tend to have the largest investments... Keep them happy, keep the funding going.

And how do they benefit from having overseas companies involved?

 

[6Gman]

Because there's lots of money to be made from selling off our industries to foreign firms. This has happened tremendously over the past few years, and it's brought in nice short term cash for the economy. Unfortunately, neither the present Conservative or previous Labour Government thought about the long term, and it won't be so dandy in the end.

Which industry is being "sold off"? It's a franchise!

 

[AndrewE]

A different take:
Is the West Coast Partnership franchise just plain silly?
Yes, but no sillier than any other franchise! Its just another part of the massive set of smoke-and-mirrors pretend-private-provision of a utility service, just like the rest of them.
More (government tax money) is spent on trying to invent franchises for "firms" to bid for and assessing them (plus private money is wasted making bids) than a publicly-owned utility would ever consume for the same outputs. It's a desperate last-ditch attempt to try to maintain the pretence that "Public sector Bad, Private sector Good" still has some credibility.

 

[Up_Tilt_390]

I think you misunderstand franchising, and are conflating two points: what the franchising process actually does, and what franchisees bring to the process.

This isn't selling off anything. It is inviting organisations to pay us (the UK taxpayers, via Government) for the right to run train services on the WCML for the specified time. Whoever provides the best value combination (a balance between highest offer and best quality) will get that right.

Why shouldn't we seek experience from other parts of the world for something we haven't done much of? It's the whole point of international trade and co-operation is to improve your own country and generate wealth by using the experience of others.

That almost ssounds like a sugarcoated way of explaining franchising. I know how the system works, otherwise I wouldn’t be commenting on it. I’ve never heard anything the taxpayer getting paid via government by private firms to run our rail services. The government takes all the premiums.

Which industry is being "sold off"? It's a franchise!

A franchise of one of our industries that is being partially sold to a foreign company. This has happened several times, so much to the point that Trenitalia are now shortlisted for the Southeastern franchise, and I wouldn’t be surprised if they didn’t win.

 

[Master29]

Just an irrelevant name change. People aren`t interested in the "promotion" of something they`ll use immaterially. It could just as easily be called the Egyptian golden dog turd railway and it wouldn`t make a blind bit of difference.

 

[Bald Rick]

That almost ssounds like a sugarcoated way of explaining franchising. I know how the system works, otherwise I wouldn’t be commenting on it. I’ve never heard anything the taxpayer getting paid via government by private firms to run our rail services. The government takes all the premiums.



A franchise of one of our industries that is being partially sold to a foreign company. This has happened several times, so much to the point that Trenitalia are now shortlisted for the Southeastern franchise, and I wouldn’t be surprised if they didn’t win.

We elect Government, they represent us, and government money is our money. That is a fundamental part of government.

But what exactly is the problem with a company from another country beimg contracted to operate (rather than owning) a part of our rail service? UK companies operate plenty of rail, metro, bus and air services across the world. Why is this a bad thing?

And I'll bet you my house that Trenitalia don't win the SE franchise this time round. What will you bet?

 

[6Gman]

A franchise of one of our industries that is being partially sold to a foreign company. This has happened several times, so much to the point that Trenitalia are now shortlisted for the Southeastern franchise, and I wouldn’t be surprised if they didn’t win.

So are you suggesting foreign companies should be barred from bidding for franchises even if this meant higher subsidies or higher fares to balance the books?

 

[route:oxford]

A franchise of one of our industries that is being partially sold to a foreign company. This has happened several times, so much to the point that Trenitalia are now shortlisted for the Southeastern franchise, and I wouldn’t be surprised if they didn’t win.

Nope a franchise is being licensed.

In reality, it's no different to the thousands of British companies who have Subway, Burger King or McDonald's franchises.

Or American companies who run a Holiday Inn, Crowne Plaza or Indigo franchises.

A franchise can be withdrawn if covenants are not met. When something is sold, it's sold.

 

[PR1Berske]

Honestly, I'd be surprised if a private operator for HS2 actually happens.

I'll be genuinely surprised were HS2 to happen at all...!

 

[AndrewE]

I think you misunderstand franchising, and are conflating two points: what the franchising process actually does, and what franchisees bring to the process.

This isn't selling off anything. It is inviting organisations to pay us (the UK taxpayers, via Government) for the right to run train services on the WCML for the specified time. Whoever provides the best value combination (a balance between highest offer and best quality) will get that right.

Yeah, right! Somehow "inviting organisations to pay us" seems to be them paying a negative figure for the initial a few years, then they walk away from the deal when the return to the Treasury is supposed to start!

Is there any franchise yet that has turned out to be a star, paying back all that was promised and delighting their customers too? I know lots (if not most) have delighted their shareholders and directors!

 

[Up_Tilt_390]

But what exactly is the problem with a company from another country beimg contracted to operate (rather than owning) a part of our rail service? UK companies operate plenty of rail, metro, bus and air services across the world. Why is this a bad thing?

And I'll bet you my house that Trenitalia don't win the SE franchise this time round. What will you bet?

Which UK companies aside from Stagecoach? Also I’d say it depends on the circumstances. Open-access operations that don’t come at the cost of some of the local public services such as Grand Central and Hull Trains are more preferable. If it’s at the expense of the local public services such as Trenitalia potentially winning Southeastern then it’s not ideal if you ask me. You can bet your house on a franchise win or loss if you so wish, but I don’t wish to make any bets, and not doing so doesn’t discredit my arguments in anyway.

So are you suggesting foreign companies should be barred from bidding for franchises even if this meant higher subsidies or higher fares to balance the books?

Is there any evidence that suggests a correlation or cause between foreign companies running parts of the railways and keeping the fares down?

Nope a franchise is being licensed.

In reality, it's no different to the thousands of British companies who have Subway, Burger King or McDonald's franchises.

Or American companies who run a Holiday Inn, Crowne Plaza or Indigo franchises.

You’re comparing Apples and Oranges there. Fast food chains and hotels are a far cry from railways.

 

[LNW-GW Joint]

People get so hung up about foreign involvement in our railways.
It's a global business, and UK companies can compete (but few can be bothered, the risks are too high).
I assume all the foreign nay-sayers don't buy electricity from EDF or fly Ryanair or watch a Samsung TV or drive a BMW.
We let the French buy the Channel Tunnel and now Eurostar, because the City doesn't like infrastructure projects.
Brexit means more international trade, not putting up the shutters and waving a Union Jack.
More important, the WCP franchise has to square the circle of running classic -compatible services on a tilting railway.
The nationality of the operator is irrelevant.
They won't be choosing the rolling stock, that's down to DfT.
But they do have to market the service for maximum benefit to HS2 and classic WCML, which won't be easy.
There is far more at stake than the nationality of the winner.

 

[Chester1]

Which UK companies aside from Stagecoach? Also I’d say it depends on the circumstances. Open-access operations that don’t come at the cost of some of the local public services such as Grand Central and Hull Trains are more preferable. If it’s at the expense of the local public services such as Trenitalia potentially winning Southeastern then it’s not ideal if you ask me. You can bet your house on a franchise win or loss if you so wish, but I don’t wish to make any bets, and not doing so doesn’t discredit my arguments in anyway.

National Express have a large portfolio of overseas rail operations which they pulled out of the UK market to focus on (which indicates UK rail franchises are not as profitable as many people think). Prior to brexit hitting the value of the pound DB were planning to float an intial 45% stake in Arriva on the London Stock Exchange. Most of DBs European services outside of Germany are part of Arriva so we would have been close to having another British based international train and bus opperator. Hopefully the plans will be reconsidered after brexit.

Renationalisation policies ussually focus on heavily unionised industries because they are really about the unions relationship with the Labour Party. Funny how BR must return, bus renationalisation is a low priority and coach plus airline nationalisation is not considered. Royal Mail is top of Labours list despite only a small part of its service being a natural monopoly but BT, Virgin Media and mobile networks are not going to be nationalised.

Rail franchises can end with their contracts if a future government decides to run rail services.

 

[Up_Tilt_390]

National Express have a large portfolio of overseas rail operations which they pulled out of the UK market to focus on (which indicates UK rail franchises are not as profitable as many people think). Prior to brexit hitting the value of the pound DB were planning to float an intial 45% stake in Arriva on the London Stock Exchange. Most of DBs European services outside of Germany are part of Arriva so we would have been close to having another British based international train and bus opperator. Hopefully the plans will be reconsidered after brexit.

Renationalisation policies ussually focus on heavily unionised industries because they are really about the unions relationship with the Labour Party. Funny how BR must return, bus renationalisation is a low priority and coach plus airline nationalisation is not considered. Royal Mail is top of Labours list despite only a small part of its service being a natural monopoly but BT, Virgin Media and mobile networks are not going to be nationalised.

Rail franchises can end with their contracts if a future government decides to run rail services.

National Express probably couldn't win another franchise anyway after handing the keys back with the East Coast Main Line. As for renationalisation being unionised industries because of the union relationship with Labour, it's just like the mirror image of many Tory doners being those who benefit from privatised industries. Airlines and Broadband were actually made an open market though, whereas the railways are just private companies running train services for a fixed amount of time while pretty much collecting all the fares. If it was ran in the way of the Big Four it'd work, but franchising is an absolute shambles. I don't mind open-access operators whether foreign or local because that allows railways to be a genuine open market without hurting the railways. It gives people more choice too, which means competition, which means potentially driving down the fares.