SWR to be nationalised?

[Meerkat]

Wouldn't that just restart the strikes?

I don’t think me smirking would restart the strikes....Oh I see....
Depends. If it was a direct DfT commandment from a government with a stonking majority and a pledge to create “minimum service during strikes” laws then would the RMT think they could win?
A whole month of strikes seems to have had remarkably little impact politically - presumably far less than the RMT expected from the Tory shires.

 

[Journeyman]

I’m not convinced about that, it’s surely far more about the union retaining maximum leverage within whatever ownership system is in place

Nah, I think they're just using their members in a political battle to try and force nationalisation. Given who just won the election, and more importantly by how much, I think they're playing a dangerous game. I can't see the Tories promising a safety-critical guard on every train.

 

[Robertj21a]

Wouldn't that just restart the strikes?

Will we notice the difference ?

 

[hwl]

Wouldn't that just restart the strikes?

The difference would probably be that DOO capable stock would have been delivered at that point - the clock is ticking.

 

[nlogax]

Could someone please explain to the layman / regular SW lines commuter (ie me) whether today's news would really have been just as likely if SWT had remained as the TOC? I see reference to the last couple of years of Stagecoach's management being 'poor'.. as a regular SWT passenger I don't recall anything that affected services but then again it was some time ago and maybe I missed something.

 

[Robertj21a]

Well, the RMT have got what they wanted.

I've long been convinced that their disputes are far more about forcing franchises to fail than anything else.

On past experience, I doubt that the RMT has the ability to think that far ahead. When you spend your whole life trying to go back to the 1970s it must be difficult to understand how a modern railway could actually work efficiently.

 

[Journeyman]

Could someone please explain to the layman / regular SW lines commuter (ie me) whether today's news would really have been just as likely if SWT had remained as the TOC? I see reference to the last couple of years of Stagecoach's management being 'poor'.. as a regular SWT passenger I don't recall anything that affected services but then again it was some time ago and maybe I missed something.

The change of franchise terms is the important issue, rather than who actually ran it. I moved away from SWT's patch in 2009, but certainly at that time they seemed to get the fundamentals right. Because they were an early franchise - the very first, in fact - they won it on very simple terms and made ridiculous profits. The DfT were determined to claw that money back when it was re-let, and Stagecoach didn't want it on those terms.

 

[3141]

The change of franchise terms is the important issue, rather than who actually ran it. I moved away from SWT's patch in 2009, but certainly at that time they seemed to get the fundamentals right. Because they were an early franchise - the very first, in fact - they won it on very simple terms and made ridiculous profits. The DfT were determined to claw that money back when it was re-let, and Stagecoach didn't want it on those terms.

The SWT franchise which ended in August 2017 was the third one. No. 1 ended in 2003 and no. 2 in 2007. No. 3 certainly didn't produce ridiculous profits. Stagecoach offered a very large premium in order to win. According to Modern Railways, their bid was greater than the sum of the second and third bids. Modern Railways has also reported that one of the reasons why Stagecoach didn't win in 2017 was that some aspects of their bid were not fully complaint with the tender: they had realised that some of the timetable expectations were not realistic, while First/MTR did not.

 

[Robertj21a]

The SWT franchise which ended in August 2017 was the third one. No. 1 ended in 2003 and no. 2 in 2007. No. 3 certainly didn't produce ridiculous profits. Stagecoach offered a very large premium in order to win. According to Modern Railways, their bid was greater than the sum of the second and third bids. Modern Railways has also reported that one of the reasons why Stagecoach didn't win in 2017 was that some aspects of their bid were not fully complaint with the tender: they had realised that some of the timetable expectations were not realistic, while First/MTR did not.

First Group has form for not getting their figures right.......

 

[js1000]

I was surprised to hear last year about First effectively writing off the TPE franchise with a £100m over the remaining 6 years of the franchise.

But £135 million on a franchise in a single year? On a supposedly self-sufficient franchise in the south? Wow... the franchise system is truly broken.

Have SWR had to soak up decreased (and unrealistic) subsidy levels as part of the franchise which has led to this loss?

 

[Chris M]

The difference would probably be that DOO capable stock would have been delivered at that point - the clock is ticking.

At least in theory, there would be nothing stopping drivers from striking and refusing to drive any train that didn't have a safety critical guard on-board. It doesn't matter what stock you have if there is nobody to drive it.
Obviously whether the drivers would do this is a different question.

 

[FenMan]

I'm old enough to remember when the government trumpeted that the South Western franchise didn't need any subsidy and, further, was paying a premium, thus making a return against the money invested by taxpayers i.e. us.

So, now there is news that the franchise is in severe trouble. So, in turn, SWR issue a press release, covered here: https://www.theguardian.com/uk-news...way-may-be-nationalised-after-firm-loses-137m

Here's the key quote:-

"A FirstGroup spokesman said: “SWR’s recent performance has been affected by issues including infrastructure reliability, timetabling delays and industrial action. We continue to be in ongoing and constructive discussions with the DfT regarding potential commercial and contractual remedies for the franchise and what happens next, in order to ensure we reach the right outcome for the government, our shareholders and our customers.”"

So the reason the railway exists comes last on the list by importance. Which says it all. Whoever approved that statement is a dolt.

 

[Helvellyn]

There will be politics at play here as well. For all the talk of the breaking of the red wall and blue collar conservatism the SWR network serves key Tory constituencies. Yet many of these have been yellow in the last twenty years and as Labour have discovered you take a core vote for granted at your peril. Grant Shapps also seems more willing to be vocal. If William's comes out with a new model why would you bail out incumbents?

Let First/MTR come out with proposals for a management contract. Just as Stagecoach were asked to for East Coast and Arriva have been for Northern. Assess them against what OLR comes up with and make a decision.

Mark Hopwood is at SWR to try stop the rot or manage the handover to OLR.

 

[Carlisle]

So the reason the railway exists comes last on the list by importance. Which says it all. Whoever approved that statement is a dolt.

They’ve succeeded in providing a much superior service for customers during strikes than almost any other TOC facing a similar RMT onslaught in recent years so perhaps your reading too much into a short press statement

 

[hwl]

I am not so sure this is non-news. Telegraph article suggests SWR are burning through the committed shareholder funding rapidly and it will be all gone by March. No doubt FirstGroup will not provide any additional funding unless the Franchise Agreement is substantially renegotiated in its favour, its shareholders would not wear them throwing good money after bad. DfT in a difficult position, if they renegotiate GA will immediately ask for same treatment, costing DfT loads. If they dont renegotiate its OLR time in a few weeks.

If you go through the actual accounts both First and MTR say they have funds and will fund...

 

[hwl]

At least in theory, there would be nothing stopping drivers from striking and refusing to drive any train that didn't have a safety critical guard on-board. It doesn't matter what stock you have if there is nobody to drive it.
Obviously whether the drivers would do this is a different question.

Except BR wrote some DOO wording into the driver contracts which everyone since has left carefully in place...

 

[Meerkat]

I'm old enough to remember when the government trumpeted that the South Western franchise didn't need any subsidy and, further, was paying a premium, thus making a return against the money invested by taxpayers i.e. us.

SWR are paying rather large premia, £2.6bn if it lasted to the end

So the reason the railway exists comes last on the list by importance. Which says it all

To be pedantic the railway exists because they were built to make money for their shareholders.

 

[hwl]

I'm old enough to remember when the government trumpeted that the South Western franchise didn't need any subsidy and, further, was paying a premium, thus making a return against the money invested by taxpayers i.e. us.

So, now there is news that the franchise is in severe trouble. So, in turn, SWR issue a press release, covered here: https://www.theguardian.com/uk-news...way-may-be-nationalised-after-firm-loses-137m

The £137m loss is after recognising future profits Easter 2019 - August 2025 may be lower than expected by £145m.

They actually made £8m+ profit before doom and gloom crystal ball gazing inc. after paying DfT...

It also conveniently helps First Group's overall tax position.

 

[mrmartin]

It also conveniently helps First Group's overall tax position.

That's a bit like thanking your boss for giving you a 50% pay cut as it helps your overall tax position.

 

[arfortune]

Not sure this is really news is it? First and MTR have previously said the figures no longer work and to date DfT has been reluctant to change anything contractual.
Many other issues, esp the IR, is well documented.

DfT (as with other departments) have been hampered by the gov's inability to really do anything other than Brexit for the past few years, but looks as if things are beginning to move again.

With the shouting about Northern and Transpennine, would the gov have the appetite or ability (I know its contracted out to consultancies), to have the OLR at a further three franchises?

I view this v much as First's attempt to nudge the DfT into more negotiations. Both sides can safe face by using the Williams review as a reason to 'rebase' or however you'd like to term it, until a new operator can be found.

 

[arfortune]

Well, the RMT have got what they wanted.

I've long been convinced that their disputes are far more about forcing franchises to fail than anything else.

Tend to agree - I understood that the local reps at SWT had an agreement to solve the issues but it was vetoed at a National level.

 

[Antman]

Network rail (infrastructure) failures are SWRs biggest operational problem. It’s just got so much worse in the last two to three years.

Closely followed by the workforce and it’s massive strike periods. (The passengers have basically sucked up for the last month and don’t blame SWR for that one... blaming politically motivated unions. They used a valid safety argument to try to influence an election. And passengers saw through it).

the 442 nonsense seems to be just that. They haven’t been retractioned anyway (I gather) and the overruns were huge. And the current 442 problems seem (forgive me if I have this wrong) a mix of infrastructure and Rolling stock not working with each other.

It’s had huge increases in passenger loadings. It’s had a timetable increase that the power (AIUI) couldn’t be delivered to the tracks consistently for (SWML). It’s had the unions trying to sabotage it since day one. Not try to work with MTR (at the same time it doesn’t look like they’ve tried to work with the unions either).

it’s got the whole nonsense with TFL (not that that is any better) but when it works it’s not a bad service.

It’s funny how it’s always claimed that billions are taken away in profits yet the margins are also so low that it can be a financial basket case so easily ...

 

[yorkie]

There were a lot of different discussions taking place in this thread, but it becomes very unwieldy and difficult to follow when so many different areas are being talked about in one "master" thread.

Feel free to continue any of those discussions, which can be found at:

• Could the South Western franchise focus on longer distance services?
• Could the existing SWR inner suburban "metro" services transfer to TfL control?
  
• Is an operator of last resort likely to be an improvement over SWR? (and comparison with LNER)
• SWR: Nationalisation is not the answer

We can reopen this thread as and when there is an update regarding the future of the SWR franchise.

Thanks