Great British Railways

Transition team will struggle with implementation

THE railway industry has not been a financially self-supporting entity since British Railways came into being in 1948, so it cannot be a surprise that the Government undergoes periodic mood swings about its role and purpose.

The early success of the franchised operators in revitalising passenger numbers was later undermined when contracts were awarded to operators that had over-bid in terms of premium commitments.

This occurred twice for the InterCity East Coast franchise, with the failures of both National Express and Virgin Trains East Coast, which resulted in operations having to be put into the railway’s own form of special measures (the appointment of an Operator of Last Resort).

With deficiencies in the way franchising had developed, and an escalation in operating costs, former British Airways Chief Executive Keith Williams was called in to report and he concluded that a concession model was a better solution - the main difference being that a train operator is not exposed to revenue risk and is paid a fee to run a defined train service.

To streamline efficiency a new contractletting organisation would be created, which combined the Department for Transport Rail Group with Network Rail and the Rail Delivery Group, which manages ticket retailing processes.

Although gaining the title Great British Railways (GBR) and reverting to the use of the British Rail double arrow logo, what is to happen has little in common with the previous nationalised era.

There will be no straightforward pathway to establish GBR in the way the British Transport Commission and Railway Executive was created at the start of 1948.

Then it was possible to establish the nationalised industry five months after the 1947 Transport Act received Royal Assent on August 6 1947, with a straightforward transfer of assets and staff to the new organisation.

At that time the management toolkit was very limited with traffic information reported in manual returns, which meant business trends took time to emerge compared with our era of big data. A sharp comparison to today, with next-day information about ticket sales and very precise real-time statistics about performance.

One certainty was the financial decline that took place between nationalisation and 1962, when the British Railways Board was created. Figures showed a break-even position had declined to a loss of £164 million (£1.9 billion at current day values), which led to the Beeching closure programme. It can now also be seen that the loss was understated, because of low levels of essential asset replacement with a make do and mend policy.

As then, the management task remains immense, with a geographic dispersion of activity that requires delegated authority and staff empowerment away from the centre.

For GBR, the original aim was to allow a guiding mind to develop. But it is clear that the DfT and Treasury will continue to be the big players in controlling the funds available and approving Strategic Business Cases for investment.

“It is clear that the DfT and Treasury will continue to be the big players in controlling the funds available and approving Strategic Business Cases for investment.”

It is also increasingly clear that the GBR remit will not extend to the devolved administrations and possibly the elected Mayors in larger conurbations. The overall impact will also be limited as existing track access contracts will be honoured - leaving the freight operating companies, open access providers and charter services as independent organisations.

The need for new contract awards has also diminished, as an increasing number of train operating companies have negotiated new National Rail Contracts with the DfT. The latest is Govia Thameslink Railway, where a three-year deal commenced on April 1 with the option of an extension for three more years, taking the arrangements through to 2028.

Also, I don’t think the GBR transition team will be over-enamoured by the competition being held to locate a new headquarters. In any case, what are the HQs’ functions going to be, as powerful regional organisations have been promised, developed on the basis of the existing Network Rail structure?

You can’t take a blank sheet of paper and declare a location to be a new headquarters without considering whether the people you need with the right skill sets are going to be available.

A salutary example is when the EWS Railway set up its new Customer Service Delivery Centre at Doncaster. No linguists could be found to manage international traffic, and it was not long before the sobriquet ‘Can’t See Don’t Care’ became associated with the facility.

It would be unwise to disturb Network Rail’s System Operator function at Milton Keynes, which includes the skilled work involved in the design of timetables and train planning activity. Competence was lost when this activity was transferred from the regional train planning offices, as staff declined to relocate. Recovery took time, so it is to be hoped there will not be any new disruption.

The transition team will no doubt be working out what the responsibilities of the headquarters should be.

A Trade Union expectation is that there will be a centralised negotiating structure covering the terms and conditions of staff employed to deliver the proposed Passenger Service Contracts.

A move in that direction will open a can of worms. It will be recalled that the 2011 McNulty report said that Driver Only Operation must be the default position to bring a reduction in operating costs. In the face of opposition, ScotRail simply decided it was too difficult to implement and other operators negotiated new terms and conditions for onboard staff that fudged the issue.

Branding of stations and rolling stock is being pushed by the transition team but has immediately met the brick wall of the Scottish Government, which wants the ScotRail brand to continue rather than running trains branded as Great British Railways. It is not difficult to predict that Transport for Wales will be unwilling to see its own brand replaced, and similar attitudes can be expected from the Liverpool City Region with regard to Merseyrail and, in all likelihood, Transport for London.

In taking over the role of the Rail Delivery Group, it will be a big challenge to reform ticket retailing. The transport market is very used to the idea that the price of a ticket varies substantially, with knowledgeable buyers knowing how to find bargains. But the value of the average ticket sale is in decline and that issue needs to be addressed.

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