Wrexham and Shropshire

[Shrop]

A recent thread in this forum reminded me of just how good the Wrexham and Shropshire service was. The staff were always friendly and helpful, including going the extra mile when there were problems. My wife and I had a 48 hour rail journey back from northern Italy in 2010 thanks to the Iceland volcano which cancelled all flights, and the final leg was Banbury to Shrewsbury. After such a long trip, we were gutted to be told at Wolverhampton that the line was blocked between there and Shrewsbury due to a failed freight train, but W&S took us to Shrewsbury via Crewe. This was well beyond the call of duty, as my experience of other TOCs is being forced to wait an hour or often more for a replacement coach, which then takes an eternity and sometimes even fails to reach final destination.

However, the "rules" meant W&S suffered being bullied off the route which was a travesty for such an enterprising company. Maybe someone might tell me I've misunderstood, but my recollection is that they were prohibited from picking up passengers at Wolverhampton, disallowed from using the WCML, and refused permission to pick up at New Street despite the morning train being pathed to run through the station. As I understand it, this was all just to protect Virgin. But then, as if that wasn't bad enough, Virgin weren't satisfied with this small company being pushed off the fast route to London as well as being disallowed from picking up at the most lucrative stations. Shortly after W&S started to run their trains, Virgin hastily introduced a competing service from Wrexham at a competitive fare, which ran via Chester, and even though this was a much longer route, use of the WCML made it faster.

Ah well, many of us from Shropshire really appreciated the W&S service before it was forced to close down. But I too cynical in my understanding of this?

 

[alistairlees]

Roughly correct. The "Moderation of Competition" clause was used by Virgin Trains to prevent W&S from calling at Birmingham NS (and Wolverhampton?). Together with a lack of suitable paths making journey times rather uncompetitive (and inefficient from a train / crew point of view) this caused sales to never match expectations. I imagine the operational costs were high too - it went through several iterations of what stock was going to be used, and I don't think loco-hauled stock was the first choice.

 

[Mcr Warrior]

Calls were permitted Southbound (towards London Marylebone) at Wolverhampton in order to set down only, in the reverse Northbound direction towards Wrexham, it was pick up only at Wolverhampton.

No calls permitted at Birmingham New Street if routed that way, nearest station stop was at Tame Bridge Parkway, the next stops thereafter were at Leamington Spa and Banbury, then fast to London Marylebone.

 

[Doctor Fegg]

Ah well, many of us from Shropshire really appreciated the W&S service before it was forced to close down. But I too cynical in my understanding of this?

The slightly missing nuance is that Virgin were required to object under Moderation of Competition rules. Virgin WC was a DfT-subsidised franchise, which meant any abstraction from a subsidised franchise to an Open Access operation would ultimately result (so the argument went) in reduced income for the Treasury.

I may have misremembered but I'm pretty sure that was cited at the time.

 

[AlterEgo]

The slightly missing nuance is that Virgin were required to object under Moderation of Competition rules. Virgin WC was a DfT-subsidised franchise, which meant any abstraction from a subsidised franchise to an Open Access operation would ultimately result (so the argument went) in reduced income for the Treasury.

I may have misremembered but I'm pretty sure that was cited at the time.

This is my exact recollection as an employee of Virgin at the time. They were obligated to object, because they were charged with preserving the value of the franchise, essentially a public asset.

 

[Shrop]

This is my exact recollection as an employee of Virgin at the time. They were obligated to object, because they were charged with preserving the value of the franchise, essentially a public asset.

Quite an odd concept! Wasn't the point of privatisation to encourage competition? So haven't we ended up with this "preserving the value of the franchise" doing exactly the opposite?

 

[Bald Rick]

The slightly missing nuance is that Virgin were required to object under Moderation of Competition rules. Virgin WC was a DfT-subsidised franchise, which meant any abstraction from a subsidised franchise to an Open Access operation would ultimately result (so the argument went) in reduced income for the Treasury.

I may have misremembered but I'm pretty sure that was cited at the time.

Exactly the case.

Also, WSMR, like all passenger opens access operators, pay rather less in track access on a like for like basis than a franchise does operator.

 

[alistairlees]

Exactly the case.

Also, WSMR, like all passenger opens access operators, pay rather less in track access on a like for like basis than a franchise does operator.

As agreed by the ORR.

 

[Peterthegreat]

Don't forget they knew (or should have known) the restrictions before they started.

 

[Bald Rick]

As agreed by the ORR.

As required by law!

 

[Jan Mayen]

I did once get picked up by W & S heading south from Wolverhampton. I had a ticket to somewhere to the west of Wolverhampton (Cosford?) and a 1st class ticket from there to London.
However, the train to Cosford arrived full and rammed. I squeezed on but noticed someone else trying to get on. As they were going to Aberystwyth, I got off and let them have my spot
Virgin staff agreed I could board if the guard agreed. He did and off we went

 

[The Planner]

Quite an odd concept! Wasn't the point of privatisation to encourage competition? So haven't we ended up with this "preserving the value of the franchise" doing exactly the opposite?

The competition is in the bid.

 

[Shrop]

As required by law!

Good job the law is there to protect the big boys. Heaven forbid that those pesky passengers might actually like the little guys, best snuff them all out and send people back to their cars. Then the big boys can carry on with their well practiced habits.

 

[tbtc]

Don't forget they knew (or should have known) the restrictions before they started.

This bears repeating

I'm all for being on the side of the underdog etc but the WSMR fans overplayed this, when the reality was that the rules were known about before they started operating - if you start a service then you are accepting the rules that apply (whether or not you agree with those rules) - whereas the way that some people tell the story, everything was going swimmingly then all of a sudden Big Bad Virgin stopped them from being able to stop at New Street like the bullies that they are

John Laing had been running Chiltern since the 1990s and Renaissance (the other partner in WSMR) had been involved with the Open Access Hull Trains for some time before WSMR started operation, so I don't buy into the narrative that these inexperienced optimists were blind sided by Virgin's lawyers and thwarted from their noble aims - they knew the rules beforehand (or certainly should have known the rules, as you say!) - it was big business trying to find a niche in the market - they shouldn't have been surprised when the company that they were competing with dared to fight back (Virgin extending a Chester - Euston Voyager to serve Wrexham - just like GNER only started serving Selby on its London services when Renaissance's Hull Trains started providing that link) - or should Virgin have allowed WSMR to undercut them on New Street - London tickets whilst still committing to the fifteen year contract that they'd agreed with the Government that had been based on the revenue that this market would generate? If you want Virgin to roll over in the face of any competition then expect future franchises to require a lot more subsidy (or a lot less premium) since TOCs would have to factor in the chance of an Open Access operator cherry picking the juicier bits of the operation!

 

[AlterEgo]

Good job the law is there to protect the big boys. Heaven forbid that those pesky passengers might actually like the little guys, best snuff them all out and send people back to their cars. Then the big boys can carry on with their well practiced habits.

The point of Open Access is not to be primarily abstractive from franchised operators. Those were public assets, which were well subsidised, and whose value needed to be protected in the interests of returning earnings to the DfT. It isn’t quite as cynical as a layperson might think.

 

[falcon]

This bears repeating

I'm all for being on the side of the underdog etc but the WSMR fans overplayed this, when the reality was that the rules were known about before they started operating - if you start a service then you are accepting the rules that apply (whether or not you agree with those rules) - whereas the way that some people tell the story, everything was going swimmingly then all of a sudden Big Bad Virgin stopped them from being able to stop at New Street like the bullies that they are

John Laing had been running Chiltern since the 1990s and Renaissance (the other partner in WSMR) had been involved with the Open Access Hull Trains for some time before WSMR started operation, so I don't buy into the narrative that these inexperienced optimists were blind sided by Virgin's lawyers and thwarted from their noble aims - they knew the rules beforehand (or certainly should have known the rules, as you say!) - it was big business trying to find a niche in the market - they shouldn't have been surprised when the company that they were competing with dared to fight back (Virgin extending a Chester - Euston Voyager to serve Wrexham - just like GNER only started serving Selby on its London services when Renaissance's Hull Trains started providing that link) - or should Virgin have allowed WSMR to undercut them on New Street - London tickets whilst still committing to the fifteen year contract that they'd agreed with the Government that had been based on the revenue that this market would generate? If you want Virgin to roll over in the face of any competition then expect future franchises to require a lot more subsidy (or a lot less premium) since TOCs would have to factor in the chance of an Open Access operator cherry picking the juicier bits of the operation!

FYI. GNER served Selby from their onset some 4 years before Hull trains started running. Stopping at Selby was nothing to do with Renaissance Trains.

 

[Shrop]

If you want Virgin to roll over in the face of any competition then expect future franchises to require a lot more subsidy (or a lot less premium) since TOCs would have to factor in the chance of an Open Access operator cherry picking the juicier bits of the operation!

Yes, I don't entirely blame Virgin for this, although even if they were doing whatever the law required them to, I don't think they were required to introduce the Wrexham to London competing service, were they?

What was missing was sufficient Government capability, ie to allow competition but then have appropriate offsets for the main franchisee.
Healthy competition should be about collecting and developing ideas for the benefit of the industry as a whole, but actively killing off competitors is an unnecessarily ruthless way of doing it, because that then leaves nothing to be learned from, and allows complacency to grow in what's left.

 

[falcon]

Roughly correct. The "Moderation of Competition" clause was used by Virgin Trains to prevent W&S from calling at Birmingham NS (and Wolverhampton?). Together with a lack of suitable paths making journey times rather uncompetitive (and inefficient from a train / crew point of view) this caused sales to never match expectations. I imagine the operational costs were high too - it went through several iterations of what stock was going to be used, and I don't think loco-hauled stock was the first choice.

The slightly missing nuance is that Virgin were required to object under Moderation of Competition rules. Virgin WC was a DfT-subsidised franchise, which meant any abstraction from a subsidised franchise to an Open Access operation would ultimately result (so the argument went) in reduced income for the Treasury.

I may have misremembered but I'm pretty sure that was cited at the time.

Why did GNER not use this Moderation of Competition rule to get rid of Hull Trains and Grand Central?

GNER went to Court to try and get a reduction in franchise payments becuse of Grand Central starting to run trains and lost!

 

[pdeaves]

Why did GNER not use this Moderation of Competition rule to get rid of Hull Trains and Grand Central?

GNER went to Court to try and get a reduction in franchise payments becuse of Grand Central starting to run trains and lost!

I believe MoC only applied on the West Coast route because of the money being put in to upgrade the route.

 

[frodshamfella]

I travelled on The Wrexham and Shropshire a few times. Loved it, was like going back in time. Comfortable, good service, great 1st class product. Sadly missed.

 

[AlterEgo]

Yes, I don't entirely blame Virgin for this, although even if they were doing whatever the law required them to, I don't think they were required to introduce the Wrexham to London competing service, were they?

No, but to play Devil’s advocate, why shouldn’t the heavily publicly subsidised operator, which paid the largest track access charges and which was charged with returning the largest sum back to the exchequer, compete with the entirely private Wrexham and Shropshire?

Wrexham and Shropshire never made a profit because the service could not command enough interest, and was always likely to be a short lived operation. Its purchase by Deutsche Bahn extended a necrotic operation because the company was interested in its assets, which now ply the Chiltern route.

What was missing was sufficient Government capability, ie to allow competition but then have appropriate offsets for the main franchisee.

On-track competition wasn’t really an aim of privatisation. The intent was to drive competition at the tender stage to get competent franchisees which could return proceeds to the government, and to outsource and fragment capital risk onto multiple parties.

I travelled on The Wrexham and Shropshire a few times. Loved it, was like going back in time. Comfortable, good service, great 1st class product. Sadly missed.

Also stupidly cheap. £29 one way on a railcard with restaurant-standard lunch thrown in. Was dead as a business model from the moment it started. Should have been a low-frills operation with DMUs.

 

[WesternLancer]

Quite an odd concept! Wasn't the point of privatisation to encourage competition? So haven't we ended up with this "preserving the value of the franchise" doing exactly the opposite?

Worth bearing in mind that the govt of the day had changed from the original Tory privatisers who saw Open Access as an important part of their vision for privatized railways and customers benefiting from competition just like this, to New Labour who would have been far more lukewarm about that but happy to change the emphasis to competition at the point of franchise tender (to preserve the sense that they were not 'nationalisers' a la Corbyn's Labour say, but not evangelists for privatised railways, juts did not want to be seen to be 'anti private sector' by the business and investment community etc etc). Of course new labour had to pick up the pieces (aka vast costs) of Railtracks failed WCML modernization plan which would have meant the Treasury taking a keener interest in abstraction of the ticket income than they might otherwise have done.

Competition at the franchise bid stage is not consumer driven competition at all - since it is just competition for the government's contract, not offering the passenger choice (juts the govt's choice). So the Tories should have kicked off about that big time (and reversed it in 2010 or at least 2016) but by that time I sense the Tories had become embarrassed by rail privatization really, as it had filed to deliver what they claimed it would - ie greater consumer choice, and did not want to be seen to be focusing on it because if people thought it had failed, they would have had to admit to having got it wrong to start with (which I assume they have tacitly now accepted with the Shapps-Williams proposals).

I recall at the time the supposed irony (probably highlighted in Private Eye among other places) of Virgin doing this ref west coast when this was precisely what Virgin Atlantic accused British Airways of doing for many years on their transatlantic route where Virgin posed as the plucky underdog that W&S seemed to be on WCML.

 

[30907]

Why did GNER not use this Moderation of Competition rule to get rid of Hull Trains and Grand Central?

Surely they - or the Regulator - did? HT cannot call at Peterborough (or Newark) and GC run non-stop over that section.

 

[43096]

No, but to play Devil’s advocate, why shouldn’t the heavily publicly subsidised operator, which paid the largest track access charges and which was charged with returning the largest sum back to the exchequer, compete with the entirely private Wrexham and Shropshire?

“Heavily publicly subsidised” and “returning largest sum back to the exchequer” are mutually exclusive aren’t they?

On-track competition wasn’t really an aim of privatisation. The intent was to drive competition at the tender stage to get competent franchisees which could return proceeds to the government, and to outsource and fragment capital risk onto multiple parties.

Which is why DfT keep giving out direct awards like confetti that have locked in failing operators like First on GWR…

Should have been a low-frills operation with DMUs.

That was the intent, wasn’t it? But then (as now) there were no such suitable DMUs available.

 

[Shrop]

Some good comments, especially some of the later ones, which make sense and which I appreciate. It seems that WSMR were victims of a number of circumstances, a small player who was always likely to face an uphill battle when competing with the big players, especially when the law protects those big players (and yes I do understand why with public money etc).

It does seem though, that a lot of the problem rests with the way this is all controlled by Government, and successive ones at that. Back in 1982 an episode of Yes Minister (Bed of Nails) epitomised very well the fear that Ministers have of transport, and when it comes to elections ever since and right up to today, transport matters are always notable by the absence of mention. The impression is certainly that Government deals with it all reluctantly and as "hands off" as possible. I know from many years first hand experience in road traffic, that whenever something goes well, including when significant improvements are made, it gets largely taken for granted, but if something goes wrong and there are delays then there is never a shortage of complaints, usually encouraged by the press, and in this rail is no different.

I firmly believe there are ways in which both road and rail travel could be vastly improved, often without huge cost, but without strong leadership which could quickly become vulnerable to allegations of being dictatorial, then we're not likely to change much from where we are now, with itself leaves a great deal to be desired.

I could say a lot more and probably provoke all sorts of reactions about pontificating etc, but who knows, some of the dialogue might be very constructive and even beneficial depending on who reads it, but that's a matter for another thread. I'm open to being challenged!

 

[pdeaves]

Surely they - or the Regulator - did? HT cannot call at Peterborough (or Newark) and GC run non-stop over that section.

I think that's strictly under 'not primarily abstractive' rules rather than moderation of competition.

 

[tbtc]

FYI. GNER served Selby from their onset some 4 years before Hull trains started running. Stopping at Selby was nothing to do with Renaissance Trains.

Ah, fair enough, I thought they were still running via Goole (until HT arrived)

Yes, I don't entirely blame Virgin for this, although even if they were doing whatever the law required them to, I don't think they were required to introduce the Wrexham to London competing service, were they?

No, but I don't think anyone would have been surprised when the "big" company decided to retaliate a little (using stock that would otherwise have started/finished at Chester, so not cutting any of their existing services) - I wouldn't go into competition with someone on the assumption that they won't react in some way - there had been examples of TOCs squabbling with each other before, with price competition on some routes or service changes - e.g. Virgin doubled their Derby - Birmingham service at the time of "Princess" so Central Trains extended their Matlock - Derby service through to New Street

On-track competition wasn’t really an aim of privatisation. The intent was to drive competition at the tender stage to get competent franchisees which could return proceeds to the government, and to outsource and fragment capital risk onto multiple parties.

Agreed - yet we keep seeing privatisation being blamed for not living up to something it was never intended to be

I'm sure some ignorant backbencher will have given a speech in the '90s suggesting some proper "competition" but that would never work on the railways - we are asking businesses to bid for seven/ten year contracts so of course their subsidy requirements are going to be based on certain guarantees (rather than a free for all!)

It seems that WSMR were victims of a number of circumstances, a small player who was always likely to face an uphill battle when competing with the big players, especially when the law protects those big players (and yes I do understand why with public money etc)

...but circumstances that were known about before they chose to bid (especially remembering that WSMR were the people behind Hull Trains/ Chiltern etc, so not naive in the ways of setting up and operating train services) - I don't think that the goalposts really changed (other than VT subsequently running a token Wrexham extension of their Chester - London services, which wasn't a huge surprise)

It was a nice idea, it might have worked if they'd played things differently (they seemed to be competing on both "price" and "bells and whistles", whereas Hull Trains was more of a basic operation where your cheaper ticket meant you put up with a two coach Turbostar from Humberside to London), it seems a long time ago that we had a railway where smaller places were demanding London links (Wrexham/ Hull/ Hartlepool etc got theirs, there were plans for an Aberystwyth to London service by ATW and various other suggestions), but there was an element of "victimhood" in some of the WSMR debates at the time - they were grown ups, they played the system where they could, squeezing large sums out of the WAG for improving facilities at Wrexham on the basis that they'd be based there then threatening to scrap the Welsh bit of the services when the WAG questioned the actual jobs that they'd created (AFAICR) - it was more like "Goliath vs Goliath" but the loco hauled trains and the anti-Branson sentiment allowed people to see WSMR as more of a "David"

 

[Rescars]

These are well made points and no doubt reflect the business reality of the situation. However, from the passengers' perspective, the W&S proposition was simply wonderful. I shall never forget my first trip (to see a client in Telford), heading out from Marylebone the evening before, being cosseted in a real train, with a real loco, travelling first class in a real carriage with seats lined up with the windows, a totally unanticipated and excellent meal served by charming staff, a fascinating route and all for a price less than a standard ticket would have cost via WCML. Naturally I continued to use the service whenever I needed to go to Telford - whilst it was on offer. To be recognised and be known by name when boarding the train was remarkable too. Sadly of course this was only possible with low user volumes so clearly this couldn't go on for ever, but my goodness, as a passenger, it was truly exceptional whilst it lasted.

 

[WesternLancer]

Agreed - yet we keep seeing privatisation being blamed for not living up to something it was never intended to be

I'm sure some ignorant backbencher will have given a speech in the '90s suggesting some proper "competition" but that would never work on the railways - we are asking businesses to bid for seven/ten year contracts so of course their subsidy requirements are going to be based on certain guarantees (rather than a free for all!)

Wasn't it Rt Hon Roger Freeman MP and his speech about trains for secretaries and trains for business people that promoted this notion and that idea of privatization? (or am I misquoting?) - not some ignorant backbencher but the actual Minister in charge of the show... so perhaps not that unreasonable for investors or anyone else to think this was an aspect of the plan. Tho things had admittedly changed by the time W&S tried to make a go of it.

From Wikipedia:

Minister for Public Transport (1990–1995) ranking as Minister of State.[2] In that post he was responsible for steering through the House of Commons the Railways Bill, providing for the privatisation of British Rail and enacted as the Railways Act 1993.

 

[AlterEgo]

“Heavily publicly subsidised” and “returning largest sum back to the exchequer” are mutually exclusive aren’t they?

No they’re not. Train companies may receive vast subsidies and still end up making a profit, resulting in a return to the exchequer.