NOTICE UNDER SECTION 56 OF THE RAILWAYS
ACT 1993
South West Trains Limited
I hereby give notice under section 56 of the
Railways Act 1993 (the "Act") that I propose to make
a final order under section 55 of the Act, in the form contained
in the attached Schedule (the "proposed order") in relation
to South West Train Limited ("SWT").
The proposed order is to be made for the purpose
of securing compliance with clause 5.3(d) of the Franchise Agreement
(the "SWT" Franchise Agreement") between the Franchising
Director, Stagecoach plc and SWT made on 18th December 1995. Expressions
defined in the SWT Franchise Agreement have the same meaning in
this Notice.
I am minded to make the proposed order unless
I am satisfied that SWT has taken steps to operate an acceptable
level of train services in future. In deciding whether to make
the proposed order I will consider any representations I receive.
I will also consider, in particular, whether SWT has cancelled,
other than by reason of Force Majeure, more than 1.5% of the train
services it is scheduled to operate in the Reporting Period ending
on 26 April 1997.
SWT is likely to contravene clause 5.3(d) in
that:-
(a) on 24 October 1996 SWT notified the Franchising
Director that the Actual Capacity of the trains included in its
train plan for the Reporting Period ended 13 September 1996 was
less than the Call-in Threshold for the aggregate Planned Capacity
of each such train for that Reporting Period;
(b) it was agreed between the Franchising Director
and SWT on 14 February 1997 that SWT would be regarded as having
exceeded the Call-in Threshold for Total Cancellations for the
Reporting Period ended on 1 March 1997; and
(c) by reason of cancellations of train services
which have already occurred during the Reporting Period ending
on 31 March 1997 and further cancellations of train services planned
by SWT in that Reporting Period it is likely that Total Cancellations
in that Reporting Period will exceed the Call-in Threshold of
Total Cancellations for that Reporting Period;
and accordingly it is likely that SWT will contravene
clause 5.3(d) of the SWT Franchise Agreement by providing the
Passenger Services under the SWT Franchise Agreement in such a
manner that it will become obliged on three occasions in less
than thirty nine consecutive Reporting Periods to notify the Franchising
Director under Clause 5.3(d) of such failures to achieve the Call-in
Thresholds for the aggregate Planned Capacity of trains or Total
Cancellations.
In setting a monetary penalty in the proposed
order, which is appropriate in all the circumstances, I have had
regard in particular to the level of Total Cancellations in the
Reporting Period ending 1 March 1997 and the likely level of Total
Cancellations in the Reporting Period ending 31 March 1997; the
value of passengers' time contained in the incentive regime under
Schedule 7 of the Franchise Agreements; the amount of the Franchise
Payments payable to SWT; and SWT's turnover.
Representations or objections with respect to
the proposed order may be made in writing not later than 21 April
1997 to the Franchising Director at Golding's House, 2 Hay's Lane,
London SE1 2HB marked "SWT representations".
Franchising Director
Office of Passenger Rail Franchising
14 March 1997
Note: clauses 5.3(c) and 5.3(d) of the SWT
Franchise Agreement provide as follows:-
5.3 (c) The Franchise Operator shall notify
the Franchising Director immediately (and provide such further
information and attend such meetings as he may request in relation
thereto) if, in relation to the Timetable and Train Plan and any
Reporting Period during the Franchise Term;
(i) there are more Cancellations during such
Reporting Period than the Call-in Threshold of Cancellations;
(ii) there are more Total Cancellations during
such Reporting Period than the Call-in Threshold of Total Cancellations;
or
(iii) where applicable, the aggregate of the
Actual Capacity of each train included in the Train Plan in such
Reporting Period is less than the Call-in Threshold of the aggregate
of the Planned Capacity of each such train.
5.3 (d) The Franchise Operator shall provide
the Passenger Services in such a manner that, except to the extent
that the Franchising Director determines, in the light of the
circumstances giving rise to any obligation under Clause 5.3(c),
that the occurrence of such obligation is to be disregarded for
the purposes of this Clause 5.3(d), it will not be obliged to
notify the Franchising Director under Clause 5.3(c) three or more
times in any period of thirty-nine consecutive Reporting Periods
during the Franchise Term in respect of Cancellations or Total
Cancellations or Actual Capacity and the Franchise Operator being
or becoming so obliged shall constitute a breach of this Franchise
Agreement by the Franchise Operator.
SCHEDULE
South West Trains Limited
Proposed order under section 55 of the Railways
Act 1993
The Franchising Director hereby, pursuant to
section 55 of the Railways Act 1993, orders South West Trains
Limited ("SWT"):-
1 to provide the Passenger Services under the
Franchise Agreement (the "SWT Franchise Agreement")
made between the Franchising Director, Stagecoach plc and SWT
on 18 December 1995 in such a manner that Total Cancellations,
other than as a result of Force Majeure, for each Reporting Period
ending on or before 14 September 1997, shall not exceed 2.5 per
cent of trains which are scheduled to be provided under SWT's
Timetable in that Reporting Period ("Total Cancellations",
"Reporting Period" "Force Majeure" and "Timetable"
having the same meaning as in the SWT Franchise Agreement).
2 To pay to the Franchising Director a monetary
penalty of £1,000,000.
3 The order shall take effect on 9 May 1997.
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