BRITISH secretary of state for transport, Mr Grant Shapps, has announced the start of public consultation on the changes to primary legislation that will be needed to deliver the structural reform of the railway sector as set out in the Williams-Shapps Plan for Rail of May 2021.
Consultation closes on August 4 and covers the core functions and duties of Great British Railways (GBR) as the “single guiding mind” for the national network; a new governance framework to ensure clear accountabilities; and reform of wider industry structures and processes including measures to improve accessibility.
GBR will be established as a public body responsible for running the railway safely and efficiently to maximise social and economic value.
The core functions of the new organisation will include planning and managing access to the national railway network, and ensuring its safe and effective use. GBR will also manage the infrastructure currently owned by Network Rail, which is to become its main operating company. GBR’s third core function is to manage and secure delivery of high-quality, reliable passenger services and be accountable for the customer offer.
In exercising these functions, GBR will be required to pursue financial sustainability and promote efficiency, and encourage private-sector involvement to bring benefits for rail users and society as a whole.
GBR must also ensure the safe, efficient and effective maintenance, renewal, improvement and development of the railway, ensuring its capability and that of its people and systems in the longer term.
The organisation will operate under a Great British Railways Licence, which will include a duty to maximise the social and economic value of the network, as defined by the secretary of state. This is likely to include benefits from promoting the growth of rail freight, improving accessibility, and promoting efficiency, affordability and value for passengers, taxpayers and rail funders.
No legislative changes are required to implement the concession-based Passenger Service Contracts that GBR will oversee, procure and deliver to replace the current franchising model. Most of the powers and responsibilities held by the secretary of state as the franchising authority will transfer to GBR.
The consultation document says legislation will also make provision for the Scottish and Welsh governments to delegate their contracting authority for devolved passenger services to GBR if so desired, but they would not be required to do this.
The Office of Rail and Road (ORR) will continue to provide independent regulatory oversight of the track access framework, including approving access contracts, and will also continue to set access charges through the periodic review process. ORR will have a new duty to facilitate GBR policy on access and use of the railway, as approved by the secretary of state.
ORR currently has a duty to promote competition in the provision of railway services for the benefit of passengers, but to protect the taxpayer this will be amended to require the regulator to also take into consideration public-sector funding of rail services, including in matters of track access.
Under its new governance framework for the rail sector, the government proposes that ORR would not have the power to fine GBR for breaching its licence. ORR is currently able to issue a financial penalty to Network Rail for breaching its network licence.
“Issuing a financial penalty to a publicly-funded and owned body has limited ability to incentivise behaviour and may diminish GBR’s ability to deliver improvements for passengers and end users,” says the document.
GBR will be ultimately accountable to the secretary of state, who will hold powers to sanction it where necessary by exercising corporate and funding controls. ORR will still be able to fine GBR if it disregards a decision made by the regulator relating to access or charging.
According to the document, the current fragmentation of the rail sector means there is no joined-up process for business planning, increasing inefficiencies and leading to “mis-aligned incentives, poor decision-making and missed opportunities for reducing costs.”
GBR will be required to provide a five-year integrated business plan covering both infrastructure and passenger operations, setting out expected activity and outputs.
Infrastructure funding will be agreed on a five-year funding basis, as with current periodic review of Network Rail track access charges, but the financial settlement for passenger services will continue be subject to separate funding processes tied more closely to the allocation of government funding. Major enhancements to the network will continue to be separately governed.
The government’s proposals for reforming wider industry structures and processes includes a National Rail Accessibility Strategy to improve accessibility and ensure consistency across the network, combined with a new accessibility duty on GBR, a statutory requirement for it to consult with accessibility stakeholders and a National Accessible Travel Policy setting out what passengers can expect.
These measures are intended to drive cultural change in the rail industry to ensure that accessibility is not a “nice to have” but is considered in everything that GBR does.
Wider reform will also include the development of a rail data marketplace, where open rail data will made available for innovators and app developers to build better tools for passengers.
The government says it is committed to an “open by default” approach to data sharing, in order to provide better journey information, improve transparency and bring new entrants into the rail market. GBR will develop and implement an open data policy, while respecting existing legislative requirements for confidentiality. Future contracts with passenger train operators will be amended to require them to acknowledge and cooperate with this policy.
“The plans outlined in this consultation will deliver a rail system that is the backbone of a cleaner, greener public transport system, offering passengers and freight customers a better deal and greater value for money for taxpayers,” Shapps says.
“These plans are designed to take the best of the private sector and fuse it with a single guiding mind that can drive benefits and efficiencies across the system as a whole, securing our railways so that they are able to flourish into the future and as we approach their bicentenary in 2025.”
“Strong independent regulation is also at the heart of these proposals and ORR has an important role to play in supporting the railway to be a success, by evolving to provide robust independent scrutiny, while continuing to protect the interests of both users and taxpayers,” says ORR chief executive, Mr John Larkinson.