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Industry responds to England’s Northern franchise announcement

Posted: 9 January 2020 | | No comments yet

A statement released by Grant Shapps, Secretary of State for Transport, has raised concerns over the financial viability of the Northern franchise operated by Arriva Rail North.

Northern has welcomed the 10th new train to upgraded fleet

In his statement released on 9 January 2019, The Rt Hon Grant Shapps MP stated that passengers in the North of England have had to put up with “unacceptable services for too long” and that the Department for Transport (DfT) are “taking action to make sure that performance improves.”

The statement goes on to read: “On 16 October 2019, I informed the House, through the Transport Committee, that I had issued a request for a proposal to the current Northern franchisee, Arriva Rail North (ARN) and to the Operator of Last Resort as the first phase of securing options for the continuation of passenger services on the Northern franchise. This was triggered by concern over the financial position of ARN.

“It has now been confirmed to me from the most recent available financial information that the franchise will only be able to continue for a number of months. The proposal I requested from ARN is being evaluated. Following completion of this process I will consider whether to award ARN a short-term management contract or whether to ask the Department for Transport’s own Operator of Last Resort to step in and deliver passenger services. Longer-term decisions on the franchise will be made in the light of the recommendations of the Williams Rail Review.

Following the statement, Transport for the North has called on the government to show full commitment to rail services for passengers as the franchise is re-assessed and re-allocated. Transport for the North’s Strategic Rail Director, David Hoggarth, said: “This is an important day for rail users across the North of England. They, and we, have been calling for the restoration of reliable rail services across the network for almost two years now.”

Putting passengers first

David continued: “Today’s announcement means that, finally, hard-pressed passengers can get the chance of a fresh start. We welcome the clear timeline for a decision to be made by the end of January. We’ve been clear that putting an Operator of Last Resort in place of Northern would be the only way to rebuild trust and confidence, and secure the right outcome for passengers.

“The North’s leaders have said that a Direct Award to Northern, even on a short-term contract basis, is likely to be seen by rail users as a reward for failure.”

Rail Minister Chris Heaton-Harris MP met Transport for the North’s members on 8 January 2020 at the Transport for the North Board meeting, at which they made clear that establishing whatever replaces the current franchise should be done with the direct involvement of Transport for the North and its members so the interests of passengers in the North can be fully represented.

David added: “A top priority for us is ensuring passengers are put first in this whole process – that includes continuing to deliver on improved services, on infrastructure, and on new trains. We accept there is no silver bullet that will solve all the issues – that’s why it’s important that the government also deliver a pipeline of significant investments in our railways as a matter of urgency.”

The need for reliable services

David Sidebottom, Director at the independent watchdog Transport Focus, said: “Whichever organisation runs northern rail services, under whatever new arrangements, passengers will want a reliable service. They also need a clear plan on how the next operator will deliver sustained improvements without disruption and introduce all the new trains promised to increase capacity and address overcrowding. Passengers deserve better. The next operator must listen to passengers and communicate their plan to improve services and rebuild trust amongst passengers.”

In his statement, Grant Shapps made clear that his decision on which short-term option to choose will be made in accordance with the key principles set out in the statement on how he uses his rail franchising powers. In the statement he says this includes:

  • Protecting the interests of passengers
  • Ensuring business and service continuity
  • Preserving the interests of taxpayers by ensuring value for money
  • The continued quality of the franchise proposition.

In order to inform this decision, Grant Shapps states that the “department will assess the extent to which each option performs against these principles. Our value for money assessment will be based on a number of criteria, including which option returns most money to the taxpayer, the risks attached to each, and the value of any improvements in passenger services. I intend to announce my decision before the end of January 2020.”

To conclude his statement, Grant Shapps clarified “the current financial position of the Northern franchise will not impact on the railway’s day-to-day operations. Services will continue to run and there will be no impact on staff.”

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