Operators confident that passengers will return
Passenger numbers are expected to return to up to 75% of preCOVID levels when the pandemic eases, according to Abellio Group Managing Director Dominic Booth.
Addressing the House of Commons Transport Select Committee on November 18, he said: “We remain very confident about winning the majority of passengers back. We expect to be able to win back around 75% on a like-for-like basis for passenger journeys.
“Within that, there will be quite a lot of change - for instance, travel-to-work patterns will be substantially different. Trying to look to that future is crucial. We do not want to see a permanent transfer of people to the roads, not least because of the climate change agenda and congestion.”
Peter Wilkinson, Managing Director of Passenger Services, Department for Transport, told the TSC: “Getting back to 75% in any short period of time looks quite bullish. There is no question in our mind that with the ERMAs and the Direct Awards that follow, if we get the incentives right with the train operators, we can get them to detect early where their market is coming back and play to that market. The bottom line is that we need to get passengers back on the railway to maintain a financially viable system.”
Go-Ahead Group Chief Strategy and Customer Officer Katy Taylor said: “Several of us also run bus companies. We saw passenger numbers prior to the second lockdown reaching around 70%. That was bearing in mind that there was still social distancing and pockets in the various tier systems.
“I am pretty confident that once people are enabled to choose how they want to live their lives, as opposed to following Government
so we have a little bit longer. But certainly for the first ones off the rack, it will be very quick.
“We were promised by DfT that franchises would not suffer during the termination for the onset of COVID and the Government policy around COVID. We are hoping that the process proves true to the fact, and that we have transparency, fairness and reasonableness in determining termination fees.
“All I can say is that we do not recognise some of the numbers that have come out so far from the previously strong and healthy contracts we had in place. We are very concerned about the process.
“At the moment, if you decide not to accept it, the proposal is that you would go back on to your franchise agreement. And the consequences, whatever they might be, would then follow.”
During the week of the TSC hearing, Abellio ran 95%-97% of its planned services across its franchises and concessions, but passenger numbers were at only 18% of pre-pandemic levels.
Later in the session, DfT Deputy Director for Passenger Services Neil Hart explained: “We are giving the operators the very best possible chance to understand and sign up to those termination sums. They are not obliged to, and it is entirely within their gift. I would not want to speculate as to how likely they are to sign up, or not, but we are certainly following the process that gives them the best chance.”
DfT MD of Passenger Services Peter Wilkinson told MPs: “I am not afraid of legal action. I do not want it. None of us wants it. We hope to be able to find an agreed position. But if the agreed position is not value for money for taxpayers, we will have to stand up for what we think is value for money. If that ends up in legal action, it will be very unfortunate, but we will stand behind our process and behind what we are trying to achieve.”
Rail Minister Chris Heaton-Harris told the TSC that the EMAs had cost £4.07 billion. He added: “The Treasury has allowed us to enter into ERMA contracts that last up to 18 months, giving us some little time to plan for the future. The railway will need, probably for the first time in its history, to fight for its passengers to come back to it.”
Government support was £550 million to £650m per period, he said. @Richard_rail