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Are you trying to suggest that one of the prime reasons for (nationalised) Northern’s problems is that they are constrained by having to share tracks with Grand Central in bits of West Yorkshire or on the Durham Coast then?
What sort of things would Northern be able to achieve if Grand Central weren’t there?
In other words they want a monopoly without having to worry about competition or customers/passengers having a choice. Yes, I'm sure every business would love that.
Railways are not like any other business, not in an integrated world where they have contractual obligations as to minimum levels of service. How many other businesses have to let competitors share their infrastructure, or are required to operate at unprofitable times and places, while being so constrained about being able to expand capacity to meet demand?
This is getting unbelievably ‘retro’. The 1968 Transport Act which ushered in subsidies spawned an industry in ‘service costing’ to ‘prove’ what ‘needed’ subsidy. Ah! Those SAFGABS printouts. This quickly led to a realisation that more and more services were loss making, even post-Beeching and topped up with the extra withdrawals that Harold Wilson’s ministers approved.
Individual service subsidies were soon replaced by a global Public Service Obligation that basically just covered BR’s overall ‘gap’.
This is rather over-simplified but the basic message is true.
Well, given that HS2 is often justified based on its ability to rescue the industry from massive overcrowding, I don't see that as entirely unreasonable.
Well there are no TOCs in our glorious new world, only the railway.
Or something like that.
I'm not sure there is truly a great disparity in TOC staff practices, so I'm not sure much actual cross subsidisation would occur in any case.
But obviously costs of staff required to operate certain services can be divided amongst those services.
Looking at it from the other way. Many of the Network Rail costs would be the same if we ran 1 train a day as if we run 18,000 trains a day nationally, and a few of the other costs don't have a lot of difference if there's 1tph on a line or 6tph.
Well only if you make the assumption that the infrastructure is fixed and independant of the number of trains running on it.
The costs of Network Rail would be drastically reduced if only 1 rather than 18,000 trains was running each day, because the vast majority of its infrastructure could be dispensed with.
You wouldn't need tens of thousands of maintenance staff, thousands of operational staff etc etc etc. The amount of trackwork and pointwork would be a fraction of what exists today.
(See, I too can be difficult!)
I understand this argument, but I still think those fixed costs should be dispersed across service groups, even though obviously they are not easily accounted for on the basis of a flat charge per train mile.
I am not arguing for such a flat charge per mile, but just that costs are divided up in a reasonable and transparent manner.
EDIT:
As has been identified, unless there's data to the contrary, Lumo hasn't appeared to negatively impact LNER's passenger numbers, with them seeing passenger numbers increasing every year that Lumo has been running.
I don't think it is sufficient to compare LNER passenger numbers to previous years to determine if it negatively effects them.
You have to compare to a counterfactual where Lumo, Hull Trains, Grand Central etc paths are available to the franchised rail system.
Just because Lumo can't do enough damage to drive passenger numbers into outright falls, does not mean they are not hurting.
== Doublepost prevention - post automatically merged: ==
I just don't want to hide costs in a Network Grant to maintain the fiction that some service or other is provided on a "commercial" or "non-subsidised" basis.
As an example, the freight lobby regularly cites the idea of little subsidy being provided, ignoring that it pays £10s of millions for hundreds of millions or billions worth of track access.
This opaque subsidy structure leads to major market distortions, resulting in economically suboptimal results that are not immediately obvious to policymakers, because they are concealed behind this facade.
If we fully and transparently distribute the industry's costs across all revenue services, then we will be in a better position to build a railway that lives up to its potential.
If we fully and transparently distribute the industry's costs across all revenue services, then we will be in a better position to build a railway that lives up to its potential.
More transparency is always a good thing as I would suspect that the vast majority of people have no clue about how much of their rail fare is covered by state subsidy, how much is profit and how much they are contributing themselves
Then again, the same could be said for road transport. Users don't pay directly the costs of access to the motorway network and we don't expect the M25 to be commercially sustainable.
Railways are not like any other business, not in an integrated world where they have contractual obligations as to minimum levels of service. How many other businesses have to let competitors share their infrastructure, or are required to operate at unprofitable times and places, while being so constrained about being able to expand capacity to meet demand?
BT and Royal Mail for a start. Personally I would have let slot packages with one of the packages (effectively the current LNER) getting the prime slots in return for providing the unwanted ones (unprofitable times and places)
I think shared total fixed cost is a bit of a fiction in a world where the government isnt going to close down any lines that OAs are interested in.
I ponder something on the lines of the NR grant being the cost of keeping the lines physically intact if nothing at all ran (sort of hibernation), and then users paying a share of the fixed costs caused by running trains (operations such as signalling, station utilities etc) and their marginal cost based on usage.
Some more insight of the SoS' position around Open Access Operators with this letter published yesterday to the chair of the ORR.
"...I recognise the benefits that can be provided by Open Access operators in the right circumstances and that both existing and new Open Access operators can open up new markets, drive innovation and offer choice to passengers.
However, there is a balance to be struck to ensure the benefits provided by Open Access operators outweigh the impacts they have on taxpayers and the ability to operate the network efficiently. We need to be mindful of the impacts of Open Access such as the level of revenue they can abstract from contracted services and the associated implications for passengers and
taxpayers. I am also aware of the additional pressures new services can create on already constrained network capacity and their impact on the value secured from public investment in infrastructure. While Open Access operators pay variable access charges to Network Rail to cover the direct costs incurred running their trains on the network, unlike government-contracted operators they do not fully cover the costs of fixed track access charges towards long-term maintenance of the network and central support costs. Currently only one Open Access operator contributes towards fixed costs via an Infrastructure Cost Charge, and taxpayers are left to fill shortfalls...."
Well, given that HS2 is often justified based on its ability to rescue the industry from massive overcrowding, I don't see that as entirely unreasonable.
That's fine, that's only an average of £5 per passenger (on top of the £6.30 average per passenger they current pay).
Of course the opposite must also be true, that once HS2 starts operating if it starts to reduce costs to carry a given number of passengers that extra money should then be used to reduce everyone's ticket price (or more likely generally more profits for the OAO).
Well only if you make the assumption that the infrastructure is fixed and independant of the number of trains running on it.
The costs of Network Rail would be drastically reduced if only 1 rather than 18,000 trains was running each day, because the vast majority of its infrastructure could be dispensed with.
You wouldn't need tens of thousands of maintenance staff, thousands of operational staff etc etc etc. The amount of trackwork and pointwork would be a fraction of what exists today.
Indeed, but there are costs which would still exist.
Also, whilst in the extreme example of 1 train vs 18,000 at a national level, on a per line basis, the cost to keep the line open for 1tph isn't likely to be 1/10th of the cost of running 10tph.
Especially given the latest is likely to be running electric trains which are lighter (and so do less damage).
I understand this argument, but I still think those fixed costs should be dispersed across service groups, even though obviously they are not easily accounted for on the basis of a flat charge per train mile.
I am not arguing for such a flat charge per mile, but just that costs are divided up in a reasonable and transparent manner.
Likewise, however if we are having a railway, there is a cost in having it (likewise there would be costs if we were to choose it down entirely) and so whilst it may be reasonable to increase costs for service groups there is still an argument that a transparent manner includes saying "£xbn of support is the baseline each year" and excluding that from the costs.
I don't think it is sufficient to compare LNER passenger numbers to previous years to determine if it negatively effects them.
You have to compare to a counterfactual where Lumo, Hull Trains, Grand Central etc paths are available to the franchised rail system.
Just because Lumo can't do enough damage to drive passenger numbers into outright falls, does not mean they are not hurting.
That's an easy answer, if the OAO's didn't exist those paths wouldn't be being used as the DfT wouldn't be allowed to spend money to make money. (See XC and Avanti - who don't have OAO's and also haven't been allowed to return to full timetables).
I just don't want to hide costs in a Network Grant to maintain the fiction that some service or other is provided on a "commercial" or "non-subsidised" basis.
As an example, the freight lobby regularly cites the idea of little subsidy being provided, ignoring that it pays £10s of millions for hundreds of millions or billions worth of track access.
This opaque subsidy structure leads to major market distortions, resulting in economically suboptimal results that are not immediately obvious to policymakers, because they are concealed behind this facade.
If we fully and transparently distribute the industry's costs across all revenue services, then we will be in a better position to build a railway that lives up to its potential.
If you want to talk about hiding costs, Network Rail isn't the organisation which does so. It had the interest payments on the investments listed in it's reports (some £4bn, including government debt).
Whilst National Highways lists the PFI debt, there isn't the same level of transparency with the interest on the government debt.
Conversely the value of the assets are easy to find in the National Highways financial report (large graph on page 11) it is much harder to find in the Network Rail financial report as even though it's on page 3 it's within a block of text and isn't named as asset value (btw the NR RAB values increased by £8.1bn in 2022/23, which leads to the question should such an increase be offset against the costs being shared out?).
This letter dated 4 February 2025 from the Department for Transport to the Office of Rail and Road? The letter states that the Department for Transport gives qualified support to the WSMR application but does not support any of the other eight applications. I note that the WMSR application has been supported by the new Labour MP for Shrewsbury elected in the 2024 General Election so I wonder if this is one reason the Department for Transport has written qualified support of the WMSR open access application while not supporting the other eight open access applications.
Live Open Access applications, received during pre-election period
Thank you for the opportunity to provide views on the Open Access applications received during the pre-election period. We are grateful for this opportunity, and this letter provides a summary of the Department’s views on the following applications:
• Hull Trains 29th Supplemental Agreement
• Hull Trains 27th Supplemental Agreement
• Alliance Rail, Section 17
• Wrexham, Shropshire & Midlands Railway (WSMR), Section 17
• ECTL (Lumo) 11th Supplemental Agreement
• ECTL (Lumo) 12th Supplemental Agreement
• Grand Central 28th Supplemental Agreement
• Virgin Trains, Section 17
• East Coast Trains Limited North West (Lumo), Section 17
While the Department does have performance concerns as outlined above, we note the benefits that this proposed service could provide to passengers. We therefore remain supportive in
principle of this application from WSMR, subject to full analysis being undertaken by Network Rail to fully understand these risks to performance and ensure that they are mitigated as far as is possible.
Mobilisation Director for Alstom Engineering and Services, Darren Horley, wrote to Mrs Buckley to thank her for her support in backing the rail line. “This would not have been possible without your support. On behalf of Alstom and SLC Rail, I'd like to thank you again for helping us raise the economic and environmental benefits of our application," he said.
Whilst things may have improved since July, it wasn't that long ago that it wasn't the case.
Also, arguably, the example of the OAO application for services through Southampton and along the WCML would at least imply that OAO are less risk adverse at running services which would have been viable pre COVID.
Resources which require money which has been slow in being provided.
Whilst things have got better since July, there certainly was a more negative approach previously (even though rail growth, excluding Elizabeth Line and OAO passenger numbers, was at least 5.8% from the previous corresponding quarter for the last 8 quarters and 5 of those quarters were over 11% growth).
Whilst that growth is from a low baseline (due to COVID and the strikes), we're maybe (if we see 8% growth per year, when for the last full year of data it's 12% growth and the annual growth for the last 2 quartes was 10.56% and 10.60%) 3 years from being back to pre COVID numbers (even though that excludes all Elizabeth Line passengers, and there would have been quite a few using other services, such as to Reading, previously).
It's also worth noting that pre COVID had seen fairly high growth, with the average between 2009 and 2019 being about 5% per year.
One of the factors that can impact is lead time. It's all very well saying "hire more staff" or "deploy more trains" but when there's a shortage of qualified staff (whether that's drivers, engineers or anyone else) then that's easier said than done. Likewise, new trains can take several years to come into service. So sometimes just throwing money at the problem isn't enough to resolve it, at least not in the short or medium term.
Presumably meaning crew? Since then we’ve had the pandemic, people are less willing to work overtime, and of course sickness has increased along with the general population.
The traincrew workforce, especially drivers, is older than average, and I’d hazard a guess less healthy. Then you have to account for the fact that conditions that would be minor ailments for most can mean drivers are off track for long periods.
Has the DfT allowed Avanti (or other operators) to expand training capacity etc. to address any of these issues? I wonder whether OA are less affected due to more flexibility in this regard, and potentially a younger workforce overall.
Presumably meaning crew? Since then we’ve had the pandemic, people are less willing to work overtime, and of course sickness has increased along with the general population.
The traincrew workforce, especially drivers, is older than average, and I’d hazard a guess less healthy. Then you have to account for the fact that conditions that would be minor ailments for most can mean drivers are off track for long periods.
AIUI Yes, and significantly so. But from deciding to expand training (and the recruitment that preceeds it) to actually having a useful increase in productive traincrew that make a difference in the roster is measured in years. Hence why only now does Avanti have a much improved position on cancellations, even though the decision / approval was well over two years ago. I suppose the point is that very sudden changes in availability, whether through changed rates of absence, changed industrial relatioons, or other reasons have an immediate effect, but it takes years to rebuild availability through recruitment and training.
To a certain extent yes. Also, small operations tend to have a closer relationship between ’staff’ and ‘management’, and therefore more likely to help out when les frites are down.
To a certain extent yes. Also, small operations tend to have a closer relationship between ’staff’ and ‘management’, and therefore more likely to help out when les frites are down.
And OA staff have real jeopardy - they can lose their jobs, whereas TOC staff know they can let their employer go bust and get safely TUPEd onto the next one
And OA staff have real jeopardy - they can lose their jobs, whereas TOC staff know they can let their employer go bust and get safely TUPEd onto the next one
That works both ways - OA management know they have to treat their staff well for the same reasons, hence why there was no protracted industrial dispute at any OA operators. TOC management have no such concerns.
I’ve found that the DfT are slow to approve increases in resources and you then lose valuable time. In the case one TOC, the DfT had to actually see the problem happen before they authorised the spend. Slowing training down to a minimum is also another one of their ploys.
In BR days, I had a simple way of dealing with long term sicks which weren’t coming back in a few weeks. They came out of the establishment and were put in a cost centre managed by the Area Personnel Manager, for which he had a budget for, so he had to manage them, not forget them. The space in the establishment was then back filled with another (new) member of staff. If the original member of staff came back, they were one over until the next problem arose.
The current rule in many TOCs that you have to carry your long term sick on the existing working establishment is nuts. Long COVID and the current NHS problems means you will always be short of working staff and, if you have to, by the time you have managed anybody out of the business, you will have been short for ages and only then can you recruit to replace them. And then there is all the training to do.
OA is quicker off the mark and closer to the staff. They have to be.
That works both ways - OA management know they have to treat their staff well for the same reasons, hence why there was no protracted industrial dispute at any OA operators. TOC management have no such concerns.
And the management can’t sit back and let the workforce strike, without negotiating or attempting to end the dispute, safe in the knowledge that the taxpayer will bail out any revenue loss for months and years on end. There’s jeopardy on both sides, not sure why you’re only focussing on one?
And the management can’t sit back and let the workforce strike, without negotiating or attempting to end the dispute, safe in the knowledge that the taxpayer will bail out any revenue loss. There’s jeopardy on both sides, not sure why you’re only focussing on one?
Because it’s the most important difference- TOC staff know they are invulnerable, OA staff know killing the company means end of job. And they know OAs have to make money without political bailout or no job.
Because it’s the most important difference- TOC staff know they are invulnerable, OA staff know killing the company means end of job. And they know OAs have to make money without political bailout or no job.
TOC management are also “invulnerable”, for the same reasons the staff are, hence why the national dispute went on for so long. I’m not sure why you don’t seem to see that. I agree you would never get that situation on open access because both staff and management stand to lose their jobs if the company goes under - hence you have a real negotiation. The same analysis applies equally to both sides.
However there’s also more risk of OA going bust due to poor management decisions, or external economic factors irrespective of anything the staff do. If my TOC employer went bust tomorrow, I’d keep turning up to work and being paid, hence why many TOC staff aren’t keen to move to OA.
Because it’s the most important difference- TOC staff know they are invulnerable, OA staff know killing the company means end of job. And they know OAs have to make money without political bailout or no job.
I've voted no to the latest referendum and have said I'd vote yes to strike action.
Hull Trains have 100% Aslef membership and have been throwing their weight around lately.
GBRF are now on their fifth ballot regarding this year's pay rise.
The only difference I've seen at open access is that the staff do their best to run a service. There isn't the same element of failing grains for personal gain that their was at TOCs but everything is done safely and professionally.
The biggest difference from negotiations has been that management actually sit down with the union and make things work. My previous TOC didn't care if we cancelled trains or went on strike.
More transparency is always a good thing as I would suspect that the vast majority of people have no clue about how much of their rail fare is covered by state subsidy, how much is profit and how much they are contributing themselves
Then again, the same could be said for road transport. Users don't pay directly the costs of access to the motorway network and we don't expect the M25 to be commercially sustainable.
1: If you look at motoring specific taxes they more than cover the cost of the infrastructure and maintenance, some like fuel duty have a cost per mile baked in.
2: Motorists do have multiple route options so charging could result in some seriously detrimental distortions, e.g. charging for motorways resulting in diversion of traffic into rural and urban roads. If we had demand based road charging applicable to all roads then we could probably "solve" congestion particularly if cars were self driving and relatively frictionlessly shared.
1: If you look at motoring specific taxes they more than cover the cost of the infrastructure and maintenance, some like fuel duty have a cost per mile baked in.
2: Motorists do have multiple route options so charging could result in some seriously detrimental distortions, e.g. charging for motorways resulting in diversion of traffic into rural and urban roads. If we had demand based road charging applicable to all roads then we could probably "solve" congestion particularly if cars were self driving and relatively frictionlessly shared.
Depends on how you charge for access, the general idea is by mile, but if it was based on the time taken that would result in a different choice of road than if it was distance based.
However, any increase in rail use would benefit roast users by freeing up capacity on the roads. 100 extra seats on a railway line typically removes 25 people from parallel road routes.
Until such time as the government puts policies which are proactive about increasing rail capacity, then there's likely to be a role for OAO's on the network.
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