THE Williams Review, the latest major independent appraisal of Britain’s railway industry, is not set to release its findings until the autumn. Yet there are signs that the report could have profound implications for the future.
Mr Keith Williams, the former British Airways chief executive, who is chairing the evaluation, said in the annual George Bradshaw address in London on February 26 that many stakeholders have told him that the current structure is no longer fit for purpose.
“What worked 20 or 25 years ago no longer works today and will not work in the future,” Williams said. “That’s a huge concern in a fast-changing world.”
The review has identified major issues with fragmentation and accountability within the sector where it found an intrinsic lack of flexibility to react to new innovations expected by customers. Franchising, the system of awarding passenger operation contracts, could very well be reformed as a result of the findings. Definitive measures are also expected to improve alignment between different industry bodies, which arguably has dogged performance and delivery for years.
Scotland potentially provides food for thought for the British government if and when it decides to tackle the issue and introduce far-reaching reforms to address these concerns.
Responsibility for transport in Scotland was devolved to the Scottish government in 2005, with Transport Scotland formally taking control on January 1 2006. Transport Scotland is the franchising authority, with the ScotRail franchise the biggest single contract let by the Scottish government. As an executive body, the department is also answerable to Scottish ministers rather than Westminster, working in a similar capacity to Transport for London in the British capital.
Mr Bill Reeve, director of rail at Transport Scotland, who was speaking exclusively to IRJ in Glasgow, says a significant part of the department’s focus is on securing better alignment between the various industry sectors.
“Team Scotland” epitomises the collective approach pulling the national government, train operating companies, infrastructure manager Network Rail (NR), and suppliers together to deliver a better result for the customer. And Reeve reports that the alignment is working despite the limitations of the current structure.
Transport Scotland supports the Scottish government’s overall objective of promoting sustainable and inclusive economic growth for communities throughout the country. It is working to improve journey times and connectivity; reduce emissions; and improve the quality, affordability and the accessibility of transport. Rail is a major part of this, receiving more than £1bn in Scottish government funding every year.
“The Scottish body politic doesn’t start with a debate about whether rail is a good idea or not,” Reeve says. “They start with the understanding that rail has an important role to play, and ask whether you are doing it well enough, are you doing enough of it, and if you can do it better?
“We are able to connect the purpose of the government with the governance, funding and specification of the railway. I think that is hugely important because we know what we are doing it for and what we are going to spend our money on.”
Scotland accounts for 11% of the British railway network, or 2819 route-km. There are inter-city, regional and freight services while Glasgow possesses Britain’s second-largest commuter network outside of London. Domestic passenger services are operated by a single franchise - ScotRail - with the CrossCountry, East Coast, West Coast, TransPennine Express and the Caledonian Sleeper franchises providing connectivity with destinations south of the border.
Reeve says that since 2005 demand for rail has grown continually to the extent that it now has the fastest rate of growth by mode, transporting 100 million passengers per annum. This is matched by a steady rate of investment. Scotland has received £7bn since 2007 with new trains, electrification of key lines, capacity enhancements and improvements at stations all serving to enhance the attractiveness and accessibility of rail (see panel below).
Scotland is though by no means unique in benefiting from investment. NR proudly boasted in the early years of Control Period 5, its 2014-2019 funding period, which concluded on April 1, that the nationwide capital outlay was the largest since the Victorian era.
However, in contrast with NR’s troubles in England - most notably the much-maligned Great Western electrification programme as well as scheduled renewals and upgrades, which ran massively over budget and behind schedule - the Scottish projects were largely delivered as planned.
“We have managed all of our project delivery in Scotland within budget, in fact there may be a little leftover,” Reeve says. “We have not cancelled any projects; we have not deferred any renewals. We have had some problems, but I think objectively it has worked.”
One scheme that did not fare so well was Edinburgh - Glasgow via Falkirk High electrification, an early CP5 project and a key component of phase 1 of the Edinburgh-Glasgow Improvement Project (Egip).
The undertaking suffered from similar problems to Great Western, something Reeve attributes to inefficiencies following the creation of the centralised NR Infrastructure Projects. The project was ultimately delivered around a year late and 50% over budget although regular electric services did begin as planned in December 2017.
In the aftermath of this, Reeve says Team Scotland set out to find a solution to improve delivery of the second phase. Teams from Transport Scotland, NR, suppliers and contractors as well as trusted experts came together at regular workshops. NR went onto develop a more robust plan for subsequent electrification schemes, which included fewer masts and a more sensible approach to procurement. The result was completion of the Stirling - Dunblane/Alloa project at the end of 2018, and Shotts Line electrification in March, on time and on budget.
“We have remained consistently clear that what we want is efficient delivery of electrification,” Reeve says. “We haven’t always got that and it is frustrating when we have seen our delivery partners at NR take steps in the wrong direction. But they are now focused more clearly in the right direction. I am really encouraged by the approach of Team Scotland generally and NR colleagues in particular about how to deliver the next stage of electrification more efficiently.”
Critical to this improvement is the structure of the current ScotRail franchise, which Abellio began operating in April 2015.
The ScotRail Alliance (SRA) is a formal agreement between NR and Abellio ScotRail. While remaining separate companies, they are led by a single managing director and senior management team. The intention is to better enable the firms to work together to achieve common objectives.
Mr David Simpson, operations director at ScotRail, says in the four years it has been in place, the alliance has taken the formal collaboration that was already evident in Scotland to the next level.
This is apparent in weekly alliance executive meetings where people from both sides discuss performance and possible issues, with regular positive dialogue continuing outside of the meeting. “It often feels immaterial who we work for,” Simpson says.
It is also evident in project delivery. On the Stirling - Dunblane/Alloa electrification project, Simpson says there was a particular issue over track access at weekends. This situation was flagged up early by the project team to ScotRail, which led to a discussion and decision on what both sides considered the best outcome - replacing some later evening trains with buses.
“All of this could have happened without the alliance, but what I think the alliance has done is to breathe a much more open and honest dialogue between us and NR which is generally unfettered from the contractual, commercial side,” Simpson says. “Exposing people in NR to some of the TOC challenges is really healthy, but equally those in ScotRail who don’t really see NR, form a much greater view of what their challenges are. I think this greater appreciation of the challenges and risks is really healthy.”
Reeve also believes SRA is a positive step. However, he says further progress is hampered by continuing issues with aligning NR departments located outside of Scotland such as Infrastructure Projects, highlighting that alignment is not a natural state of the current structure. The result is inefficiency and increases in costs and delays.
“It is very hard for someone in Milton Keynes to remember that the Scottish government is paying their salary one day a fortnight, and they won’t know about Scottish government priorities,” Reeve says. “They will say the government wants us to do this. The UK government might, but in Scotland we want you to do this instead.
“I am not blaming the people for that; it is the situation we are in. We really welcome [NR CEO Mr] Andrew Haines’ move towards further devolution of responsibility to Scotland. The principle is very good indeed. Partial devolution has worked very well, imagine what full devolution could look like.”
The Scottish government supported a motion to allow bids from a publicly-owned company for the last ScotRail franchise, a move which was blocked by the DfT. However, with the Scottish Parliament securing the power to allow public sector bids under the Scotland Act 2016, in August 2018, the Scottish government confirmed that public companies would be eligible to bid for the next franchise.
By passing the resolution, the Scottish government is attempting to make the best of what it considers a bad situation, according to Reeve. In particular, he says it wants to tackle the influx of public sector bodies from other countries bidding for franchises in Britain, whereas a public sector body from Britain cannot.
Yet in light of the early rumblings of what the Williams Review might suggest for the future of franchising, Reeve feels the debate is moving on.
“The interesting question now is not whether will there will be a public sector bidder,” he says, “the question is, in the context of the Williams review, which has already reported that franchising in its current form needs to be reformed, whether there will be any more franchises? I don’t know the answer to that yet. But in a sense the public sector bidder question is likely to be yesterday’s question and no longer relevant.”
As for what Scotland’s preferred model might look like, Reeve says work on this is underway at Transport Scotland. “What I think our ministers would say is that there is a lot of focus on ownership but if you just transferred what exists into public ownership, you haven’t fixed the problems of the industry structure,” he says. “We are far more interested in finding out what structure and what governance is in the best interest of the passenger and the freight customer.”
More immediately pressing is the performance of the current franchisee.
After eight months of disruption, Abellio ScotRail’s performance hit breaking point in December when the operator was cancelling an average of 46 of its more than 2300 services per day. It suffered particular problems in the east of the country in and around Edinburgh.
ScotRail cited delays to training drivers and conductors to use new trains and routes as well as the late delivery of trains by suppliers Hitachi (class 385 EMUs), and Wabtec, which is refurbishing former Great Western HST sets leased from Angel Trains for use in Scotland. In total, the operator cancelled 2691 services between April 2018 and January 16.
Reeve says this is nowhere near the scale of the difficulties experienced in the north of England and on the Thameslink route, but by Scottish standards it was “awful.”
Transport Scotland issued ScotRail with a remedial plan notice relating to the November and December cancellations on December 24. This was followed by a second remedial notice in February after the franchisee failed to meet contractual targets in relation to National Passenger Rail Survey (NPRS) results, which dipped to 79% between September and November, the franchise’s lowest score for 16 years.
The operator’s problems have continued in early 2019. Extensive cancellations on the Borders Railway were followed by mass disruption on Edinburgh - Glasgow services following a signal fault on March 15.
ScotRail apologised to passengers and offered a comprehensive compensation package. It also released the £18m ScotRail Remedial Plan, as required by the remedial notice, on March 22.
ScotRail is entirely funding the plan, which includes hiring an extra 55 drivers and 30 conductors. Simpson says the extra conductors will begin work this summer and the drivers from May 2020. In addition, the franchise has leased three additional GWR HSTs, which have not yet been refurbished, to provide extra resilience with one unit assigned specifically to support training, and extended the peak locomotive-hauled service in Fife until 2020 when enough HSTs will be in service. Hitachi is supporting ScotRail and NR by providing eight further technicians and seven maintenance controllers. In addition, the operator is installing upgraded passenger information displays at 16 stations and spending £500,000 to implement improvement ideas put forward by frontline staff.
SRA chief executive, Mr Alex Hynes, told MSPs during a hearing on March 27 that there were positive signs that performance was improving with almost 90% of services meeting punctuality targets.
Simpson says 55 class 385s have now been accepted, which is sufficient to operate the May timetable, at which point he expects to have 58 sets available. Delivery of all 70 trains is now scheduled for later this year with 66 in traffic from the December timetable change.
The operator will also have 17 HSTs for May, including three refurbished trains with a fourth set to be delivered by the end of April. ScotRail requires 11 to operate the May timetable. The figure will increase to 15 refurbished sets in December when ScotRail will no longer be able to operate the classic HSTs due to accessibility requirements, although Simpson says there are enough class 170s and 158 DMUs in reserve if required.
The problems with the HSTs relate to corrosion of the coach bodies and that every Mark 3 coach is slightly different, a symptom of the fact they were built in the 1970s. “We are working closely with Wabtec and Angel to mitigate that,” Simpson says. “Wabtec has opened up additional production lines in Doncaster and Kilmarnock to help. We are taking a prudent view of delivery and don’t want to overpromise on this for May or December.
“The December timetable experience was a learned experience for everyone,” he continues. “We are in a much better place for May, which is all about additional capacity and journey time, unlike December where we introduced over 100 extra services per day to Scotland. May is about longer and faster trains.”
Reacting to the problems, some MSPs and unions have called for Abellio ScotRail to be stripped of the franchise. Scottish first minister, Ms Nicola Sturgeon, has also said that the operator is in the “last chance saloon.”
Reeve says Abellio has a 10-year contract to run the franchise, with both sides having the option to terminate at the end of the seventh year if this is activated by the end of the fifth on March 31 2020. “Of course, if they fail to deliver on performance on key parts of the contract, there are routes that allow the cabinet secretary to terminate earlier,” Reeve says.
Hynes reassured MSPs that he is confident SRA will do everything it can to meet the targets, but he admits that sometimes the circumstances of delays which impact performance are out of the franchisee’s control, whether these are infrastructure failures or the unpredictable Scottish weather. He also said it could be two years before it reaches a 92.5% punctuality target.
“We want ScotRail to be successful because all of the decisions we make go back to the strategy of delivering sustainable economic growth for Scotland,” Reeve says. “Once you follow that hierarchy, we want our delivery partners to succeed, but we need to properly hold them to account contractually when things do go wrong. We are disappointed with that little wobble but we want them to recover as constructively as they can.”
ScotRail’s troubles are certainly a blow. But there is a continuing belief that their closer working relationship with NR remains beneficial to the railway’s performance in the long-term.
Reeve’s insights into the positive changes that Team Scotland has overseen in recent years, which is translating into an improved situation for both passenger and freight customers, certainly adds weight to this argument. And if the outcome of the Williams’s review is new government policy, further improvements might just be around the corner.
However, there is one word of warning: not to right the rights of the current system. Reeve highlights an example from the rail freight sector to emphasise this point. “One of the successes of the current arrangement is that above-rail competition has driven efficiency in unit cost and improvements in customer service by the freight companies for the purchasing community,” he says.
While reform appears to be desperately needed, for some elements “if it ain’t broke, don’t fix it,” remains a good rule.
Recent infrastructure project highlights
SCOTLAND’s central belt between the capital Edinburgh and the largest city Glasgow is home to 3.5 million people and is the country’s most important transport corridor.
The centre-piece of Scotland’s recent rail infrastructure development projects, the Edinburgh-Glasgow Improvement Project (EGIP), seeks to increase capacity and performance on the central belt through a major programme of electrification as well as station improvements and the introduction of new rolling stock.
A major landmark was reached at the end of 2017 with the start of regular electric services on the key Edinburgh Waverley - Glasgow Queen Street via Falkirk High line, stage one of the EGIP project. The project enabled the replacement of class 170 DMUs initially with Siemens class 380 EMUs and eventually Hitachi class 385 EMUs.
This was followed by electrification of the Stirling - Dunblane/Alloa corridor in 2018 with regular passenger services beginning in December. This project encompassed electrification of 160 track-km at 25kV ac from Falkirk to Dunblane on the Stirling - Perth line as well as the single-track Stirling - Alloa line and the Grangemouth freight branch, which enables electric freight services to access the Grangemouth freight terminal directly from the West Coast Main Line. Electrification has reduced Glasgow - Alloa journey times by five minutes.
Network Rail also confirmed at the end of March completion of the Shotts Line electrification project. The scheme delivered 74km of electrified railway between Holytown Junction, east of Glasgow, and Midcalder Junction west of Edinburgh. Transport Scotland’s director of rail, Mr Bill Reeve, says the project, which is the fifth electrified line between the two cities, was completed ahead of schedule and on budget.
“We know that passengers like the character quality of the performance attributes of an electric railway, we see that directly in feedback and of course patronage numbers and revenue,” Reeve says. “The Scottish government has a commitment to decarbonise transport and increasingly the issue of air quality in urban areas is of growing importance, so I don’t see too many new diesel train fleets being built.”
ScotRail’s overall fleet size is increasing from 800 to 1000 vehicles with the delivery of refurbished HSTs and new class 385 EMUs. Reeve says the plan is to reassign diesel fleets away from the busy main lines in the central belt as they are electrified to boost services elsewhere on the network.
He adds that his rolling stock team is actively engaged with research regarding alternative fuel trains and is exploring options for trials and deployment. They were recently demonstrated a class 230 battery train by Vivarail in Scotland. However, he has his doubts about wide-reaching deployment of these types of vehicles.
“Fuel cell and battery trains, as promising as they are, for the next five to 10 years are going to be more expensive to buy and operate than diesels and they can’t match the performance characteristics of diesels,” Reeve says. “Whereas in some places they are seen as an alternative to electrification, we see in hard numbers, that they strengthen the case for electrification.”
Other major infrastructure projects underway, include:
- £57m of improvements to the Highland Mainline from Perth to Inverness to accommodate the HSTs, including platform extensions and resignalling work, which will add eight extra services between Inverness and the Central Belt every day
- track doubling on the 25km Aberdeen - Inverurie section of the Aberdeen - Inverness line, helping to increase frequency from one to two trains per hour from December 2019 as part of the larger Aberdeen - Inverness improvement project, which aims to improve Aberdeen and Inverness commuter services
- expansion of Glasgow Queen Street to accommodate longer trains as well as provide a larger concourse and improved accessibility, and
- lengthening of platforms at Edinburgh Waverley station.