Memorandum by the Strategic Rail Authority
RAIL SERVICES IN THE NORTH OF ENGLAND
1. The purpose of this paper is to assist
the Committee in its inquiry into "Rail Services in the North
of England", announced by Press Notice 65 of Session 2001-02
(dated 9 May 2002). The Statutory purposes of the Strategic Rail
Authority are set out in the Transport Act 2000, and are:
to promote the use of the railway
network for the carriage of passengers and goods;
to secure the development of the
railway network; and
to contribute to the development
of an integrated system of transport of passengers and goods.
2. The Authority's Strategic Plan, published
in January, set out a programme designed to achieve the key targets
set out in the Government's 10 Year Plan for Transport, viz:
to increase rail use in Great Britain
(measured in passenger kilometres) from 2000 levels by 50% by
2010, with investment in infrastructure and capacity, while at
the same time securing improvements in punctuality, reliability
to reduce overcrowding in London
to meet the Authority's standards by 2010;
a significant increase in rail freight's
share of the freight market by 2010. The Government believes it
ought to be possible to increase market share resulting in an
increase of up to 80% in rail freight by 2010.
3. In response to the decline in punctuality
and reliability of rail services since the publication of the
10 Year Plan, the Directions and Guidance issued to the Authority
on 11 April 2002 added an equal primary objectiveto work
with the rail industry to achieve substantial, lasting improvements
4. An extensive network of passenger and
freight services operate in the north of England, provided by
GNER, Virgin West Coast and Virgin Cross Country (Strategic Routes),
First North Western, ARRIVA Trains Northern and ARRIVA Trains
Merseyside (regional networks)with services also provided
by Wales & Borders and Central Trains, and freight trains
run by EWS, Freightliner, DRS and GB Railfreight.
5. The remainder of this paper addresses
the specific concerns raised by the Committee in its Press Notice.
Whether the existing franchisees provide
satisfactory services, particularly in relation to safety, punctuality,
reliability, comfort and frequency of services.
6. Responsibility for the safe operation
of the railway lies with the duty holders, principally Railtrack
and the train operating companies. The Health and Safety Executive
(HSE) is the body charged with preparing a safety strategy for
the industry, bringing regulations forward, approving new works,
accepting safety cases and enforcing legislation. It is therefore
for the safety authorities to determine whether licence-holders
are operating safely.
7. There is a statutory duty on the Authority
when exercising its functions to have regard to the need to protect
all persons from dangers arising from the operation of railways,
including, in particular, by taking into account any advice given
by the HSE. The Authority has a Memorandum of Understanding with
8. The latest Public Performance Measure
(PPM) figures, published by the Authority on 6 June 2002, are
shown in the table below for each franchise operating in the north
of England. All operators in the North of England achieved more
trains running on time in the period January to March 2002 (ie
Q4) than in the preceding period, October to December 2001 (ie
|ARRIVA TrainsMerseyside (ATM)||82.4
|ARRIVA TrainsNorthern (ATN)||70.8
|First North Western||79.9
Long Distance Operators
|Virgin West Coast||51.7
|Virgin Cross Country||28.5
Source: National Rail Trends, SRA, June 2002
9. The PPM combines figures for punctuality and reliability
into a single performance measure, and measures the performance
of individual trains against their planned timetable. A train's
performance is recorded by the automated monitoring system that
logs performanceusually using the signalling equipment.
The figures for Regional Operators show the percentage of trains
arriving at their destination within five minutes of timetabled
arrival, and for Long Distance Operators, the percentage arriving
at their destination within 10 minutes of timetabled arrival.
Performance across the network overall improved from 71.3% in
the period October to December 2001 to 80.9% in the period January
to March 2002. The performance of Regional Operators improved
from 74.1% to 81.2% in that period.
10. Passenger complaints per 100,000 journeys decreased
overall by 20% compared to the same period last year (October
2000March 2001). That period last year covered the immediate
aftermath of the Hatfield accident.
11. Passenger kilometres across the network over the
year as a whole were up by 2% and increased by 6% between January
and March 2001 and January and March 2002. Passenger journeys
for the year remained virtually unchanged. Over the year as a
whole, freight moved increased by 9%.
12. A fares price index has been introduced for the first
time. It tracks the average change in rail fares and provides
year on year comparisons from January 1999 to January 2002. The
index covers around 90% of all faressome special promotions
and tickets which include other transport modes or entrance to
tourist attractions are excluded. Results for the year to January
2002 show that on average, ticket prices for Regional Operators
rose by 2%, and 5.1% on the Long Distance/high speed routes. Around
40% of the revenue covered by the index is generated by regulated
fares, for which maximum price increases are controlled by the
Authority. For the year to January 2002, these fares showed an
increase of 0.1%. The inflation rate during the period from January
2001 to January 2002 was 1.3%.
AGAINST ARRIVA TRAINS
13. The Regional Railways North East (name subsequently
changed to Northern Spirit) franchise commenced on 2 March 1997,
under MTL Rail Limited as franchisee. In February 2000, ARRIVA
plc acquired the franchise, as part of the acquisition of MTL
Services plc. The franchise was loss making, but ARRIVA agreed
to operate it on existing terms until 18 February 2001. In February
2001 the Authority, in consultation with the local PTEs, reached
agreement with ARRIVA for an extension of up to two years, with
the option to terminate at an earlier date. The franchise operatorARRIVA
Trains Northernis contracted to provide services until
14. Following extensive service disruption involving
cancellation of around 1,000 trains a week (9,000 services are
operated by ARRIVA Trains Northern) the Authority took enforcement
action on 25 October 2001. After consultation, a penalty of £2
million was imposed on ARRIVA Trains Northern on 25 March 2002,
along with an order requiring additional drivers to be recruited,
and threatening further fines of up to £5,000 per driver
per calendar month where the company did not meet recruitment
targets set by the Authority. The order required that such drivers
should be newly trained, and not recruited from other operators.
The penalty and any subsequent fines are payable by deduction
from the company's franchise payments from the Authority.
15. The Authority has introduced the Rail Performance
Fund (RPF), with £400 million available over 10 years. This
is an early example of working with the industry to improve performance.
The fund will provide finance for performance improvement projects
that cannot be funded commercially by the private sector and third
parties alone. This fund will also be used to accelerate the implementation
of performance improvement projects. Schemes where preliminary
interest in RPF co-funding has already been expressed include
modifications to enhance rolling stock and IT systems, plus additional
and upgraded infrastructure. This funding will complement other
existing and successful schemes: Rail Passenger Partnership (RPP)
and Freight Facilities Grant (FFG).
16. The Authority is also working closely with the Industry's
National Task Force (the senior cross-industry forum on delivery
and performance) to bring various performance initiatives together.
Besides the Rail Performance Fund, these include improved rolling
stock reliability, optimised route strategies, robust timetables,
improved franchises, developing industry skills, possessions productivity,
benchmarking and spreading best practice, a National fleet reliability
improvement programme, and an infrastructure improvement programme.
Closer co-operation is being secured by the development of "Virtual
Boards" which bring together on a zonal basis, Railtrack,
train operators and maintenance contractors to resolve performance-related
17. The Authority's franchise replacement programme has
involved a re-structuring of the passenger rail franchise map
in the north of England, to allow for the creation of the new
Northern and Trans-Pennine franchises.
18. The Authority has started work on the specification
for the new Northern franchise, aiming to provide a better pattern
of regional and local services for passengers in the north of
England. The PTEs have determined their specifications, in accordance
with their rights under the Railways Act 1993. The franchise has
been structured by the Authority to provide a focus on urban and
rural services serving the whole of the north of England, including
the major population centres of Liverpool, Manchester, Sheffield,
York, Leeds and Newcastle.
19. Six parties have been pre-qualified as bidders for
the Northern franchise (viz: ARRIVA Trains Limited, Connex Transport
UK Limited, FirstGroup plc jointly with Keolis SA, GB Railways
Group Plc, National Express Group PLC, Serco Ltd). Once the specification
work is completed, these parties will be given sixty days to prepare
detailed proposals against the core specification, during which
time the Authority will consult statutory stakeholders. A shortlist
of companies will then be selected, by the Authority, to submit
their best and final offers. From these a preferred bidder will
be selected, with whom a new franchise agreement will be signed.
20. The Authority is moving forward concurrently with
the new Trans-Pennine Express franchise to develop existing inter-urban
services currently included within the ARRIVA Trains Northern
and First North Western franchises. Given the close relationship
of the constituent services, it is planned to start the Trans-Pennine
Express franchise at the same time as the Northern franchise.
21 The decision to have two franchises was made on the
basis that there are two distinct marketslocal, urban-focused
services including five "business units", four of which
include PTEs; and longer-distance, more commercial services across
the Penninesand these would be better managed for the benefit
of their passengers through a separate franchise for each. It
was specifically to avoid the risk of local services becoming
the "poor relation" within a large franchise of mixed
services, as well as to encourage development of longer-distance
services, that the current approach was adopted. The objective
for the Northern franchise, as much as for the Trans-Pennine Express
franchise, will be to obtain well-performing good-quality services
22. The franchise term of the independent Trans-Pennine
Express franchise will be eight years. This will provide time
for the new business to establish itself and provide options for
possible combination in 2011-12 when it expires.
23. On 14 May the Authority and Merseytravel Passenger
Transport Executive (PTE) pre-qualified six parties as bidders
for the new Merseyrail Electrics Agreement (viz: ARRIVA Trains
Limited, Connex Transport UK Limited, Serco Limited, TRANSDEV
plc jointly with RATP International, NS/Dutch Railways and Keolis
SA), to operate local passenger rail services following the expiry
of the current Arriva Trains Merseyside franchise in February
2003. A Parliamentary Order is being taken forward to exempt Merseyrail
Electrics services from the Authority's franchise responsibilities,
allowing Merseytravel to let the services as a local concession.
24. A two year extension to the Great North Eastern Railway
(GNER) franchise was agreed in January, providing some £100
million of addition investment in improved services, facilities
for passengers and rolling stock. Virgin Cross Country and Virgin
West Coast franchises are long-term franchises, which expire in
2012, and there are no plans to change these franchises but they
will need to be reviewed in the light of the outcome of the West
Coast Upgrade review (see paragraph 44).
The "new" franchise:
25. In December 2001 the SRA launched the new franchise
proposition15 years with review points of broadly five
and 10 years when continuation will be confirmed based on an assessment
of historic and planned performance.
Whether the plans for investment in the rail network in
the region meet the needs of additional network capacity and other
26. Major investment must be directed where it is likely
to be most effective in addressing the Government's 10 Year Plan
key targets, and the Strategic Plan sets out a programme designed
to realise this goal. About 70% of all journeys nationally are
made on the London and South East network. Train operators south
of the River Thames between them carry nearly 40% of all rail
journeys nationally. The emphasis of the major infrastructure
projects in the Strategic Plan is on London and the South East,
reflecting the primary objectives of the Government's 10 Year
Plan, which the Authority is pursuing in accordance with the Directions
and Guidance from the Secretary of State.
27. Nevertheless, the Strategic Plan contains a number
of national initiatives that will benefit the north of England,
the introduction of Train Protection and Warning
a freight company neutral revenue support scheme
to be introduced in 2002 for intermodal and "less than train-load"
freight facilities grant; Incremental Outputs
Statements for track, signalling and stations;
the establishment of a National Rail Academy;
the Rail Passenger Partnership fund;
the Rail Performance Fund;
proposals for a National Test Track to prove new
and a programme of improvements to station access
for passengers with disabilities.
28. There are 49 ARRIVA Trains Northern stations and
108 First North Western stations eligible for upgrading to provide
modern facilities under the Authority's Incremental Outputs Statement
programme. Additionally, there will be an upgrade of Preston station;
the completion of station improvements at Manchester Piccadilly;
£30 million investment by Virgin West Coast in improving
reliability, quality of passenger experience and maintenance provision;
major improvements to stations in Cumbria, and at Ashton-under-Lyne;
installation of CCTV will be installed at seven First North Western
stations; and the centralised monitoring of CCTV in the Merseytravel
ARRIVA TRAINS NORTHERN
29. The extension of ATN's franchise to February 2003
brought a commitment to procure eighteen additional vehicles,
and a further eight coaches were secured through RPP funding for
Leeds metro trains. The fleet of new class 333 electric trains
is now being expanded to four coach combinations (with associated
platform lengthening, where required).
30. RPP funding is being provided to improve passenger
information at stations between Hexham and Carlisle.
31. The Authority is funding 462 additional cycle parking
spaces at 21 railway stations throughout the Tees Valley area.
32. Service enhancements between Blackburn to Manchester
are being funded by the RPP.
33. Modifications to First North Western class 323, 142
and 150 trains will enable staff to improve on-train customer
care and revenue protection.
ARRIVA TRAINS MERSEYSIDE
34. The TOC is committed to introduce an additional three-car
train from autumn 2001 and a second from summer 2002. The Authority
and Merseytravel are considering a proposal to recast the Passenger
Service Requirement to improve overall performance.
35. Negotiations are underway with Angel Trains, Merseytravel
and ATM regarding the refurbishment of the class 507/508 trains
currently operated by ATM.
36. Thirty-four four-car CrossCountry Voyager trains
are to replace all loco-hauled services by May 2002. Progressive
introduction of new trains will deliver extra services and greater
reliability. A total of 53 nine-car, 140 mph, tilting Pendolino
Virgin West Coast trains are being constructed by Alstom. Testing
of the new Pendolino trains on the West Coast Main Line has begun
between Carlisle and Carnforth, with 42 Pendolino trains curently
planned to be in service by May 2003, serving London, Manchester,
Preston and Liverpool. Bombardier five-car Super Voyager tilting
trains are to be introduced by Virgin West Coast between London,
Chester and Holyhead in the medium term.
37. CrossCountry service frequencies will be increased
from Winter 2002 timetable on core routes to approximately double
the present frequencies, with standard "clock-face"
timetables and shorter journey times. Virgin West Coast frequencies
are expected to improve to two trains per hour between London
38. The two year extension of the Great North Eastern
Railway franchise is providing for:
a planned 11 additional services between London
and Leeds (introduced at the beginning of June),
£10 million for station and passenger information
better facilities for disabled passengers;
improved performance, compensation and customer
and a minimum £16 million contribution from
GNER to infrastructure improvements;
more than £50 million is being committed
by GNER to rolling stock, including the leasing of two additional
train sets and six new recovery locomotives, refurbishment of
all passenger carriages and the lengthening of the diesel High
Speed Trains, expected to provide an additional 70 seats per train
by the end of 2003; and
the investment package includes £20 million
to improve the reliability of the electric locomotives.
39. The Authority has created a Freight Small Schemes
Fund, which will provide £300 million over 10 years, to secure
small and medium sized freight infrastructure schemes which would
be particularly valuable improvements to the network, and can
be delivered quickly, within a fixed annual budget.
40. The Authority intends to develop and implement:
an increase in the availability of freight paths
in the order of 30% to and from ports at Immingham, Grimsby and
incremental improvements to capacity, speed and
route availability for freight trains on the Hope Valley line
between Sheffield and Manchester;
gauge clearance to W10 or W12 on the North TransPennine
route between Leeds and Manchester, including connections to ports
and terminals, permitting higher box sizes to be moved; and
development of freight diversionary routes around
41. Improvements on the capacity-constrained Hope Valley
line will provide more freight paths, faster transits and greater
reliability of both freight and passenger services. Subject to
further detailed work, diversion of freight away from central
Manchester will deliver additional capacity and free-up paths
for passenger services on central Manchester corridors.
42. The East Coast Main Line upgrade will yield significant
benefits for freight traffic in the North East and includes feasibility
studies to handler longer (775 metre) trains and larger (9'6"
containers and 2.6 metre wide) European intermodal units with
an enlarged structure gauge. Plans are also being developed to
create additional paths for freight trains on the North East/South
West route, the core section of which is Doncaster to Bristol.
43. The South Humberside Main Line currently handles
approximately 20% of all UK rail freight tonnage. Improved capacity
and speeds will consequently benefit a wide range of freight customers.
Improvements at Doncaster will also take place to accommodate
longer freight trains.
44. West Coast Main Line infrastructure upgrade and renewal
works were designed to deliver increased capacity, higher line
speeds, improved reliability and performance. Railtrack and Bechtel
have completed a thorough review of the deliver of the West Coast
Route Modernisation project. This review will now form a foundation
for the on-going discussions with the Strategic Rail Authority
and the passenger and freight train operators on implementing
the project. These discussions will ultimately determine the outputs
for the project in terms of services provided, and the overall
cost and timescales for completing the upgrade.
45. The Authority plans to lead a Joint Venture company
that will deliver an upgrade of passenger and freight capacity
on the East Coast Main Line. Improvements being developed include:
longer trains and platforms;
development of alternative freight lines to provide
increased and segregated capacity between:
Peterborough and Doncaster via Lincoln;
Northallerton and Ferryhill via Teeside;
Newcastle and Edinburgh, through provision
of freight loops;
new bridge to take East-West services, which currently
cross the East Coast Main Line by a flat junction at Newark, over
the ECML; removing this flat junction would improve capacity and
remove operational complexity;
capacity improvement works at Doncaster, Shaftholme,
York, Newcastle and other locations.
46. The completion of the £285 million "Leeds
First" project, comprising re-signalling, additional track
and platform capacity, a new station roof, customer information
systems and a new footbridge with lifts and escalators.
47. The Authority, in partnership with Railtrack, Greater
Manchester PTE, Manchester International Airport, and the Highways
Agency, has completed the Greater Manchester Strategic Rail Study,
which sets out a strategy for the development of the rail network
in Greater Manchester over the next 20 years. The first key building
block, the creation of the Trans Pennine Express franchise, is
currently underway. The partners in the study will need to consider
how best to take forward long term options, including the expansion
of light rail on the heavy rail network.
48. The SRA is also involved with Manchester Airport
and Greater Manchester PTE in the Manchester Ground Transport
Interchange Project. This scheme will increase rail capacity at
Manchester Airport station (third platform), and make it an interchange
hub for rail, bus, air, and light rail transport links.
49. A list of Incremental Output Track and Signalling
schemes in the north of England is attached as Appendix One.
The Influence of Rail Services on the Economic and Social Development
of the Region
50. While the Authority's primary focus must be on delivering
the 10 Year Plan outcomes, the strategic development of the railway
will be affected by demographic, social and other changes taking
place over the longer term.
51. The Directions and Guidance require that:
the Authority ensures that its strategies, investments
(including in passenger franchises) and other expenditures have
regard to their economic, social and environmental impacts;
the Authority must secure investment for the wider
development of the railway network for both passengers and freight;
the Authority to exercise its functions in the
way best calculated to protect the interests of users of railway
services and to contribute to the achievement of sustainable development;
the Authority should use the most effective and
innovative means to introduce capital support into the industry,
address market failures and maximise the capacity to raise private
capital by including a range of funding mechanisms;
the Authority should give particular encouragement
to schemes which support the Government's integrated transport
policy and broader sustainable development;
where a scheme appears to the Authority to secure
significant wider economic, social or environmental benefits,
but is not viable on commercial grounds alone, the Authority should
consider whether direct public financial support for such a scheme
would be justified, or whether it could be facilitated through
the development of arrangements for sharing risk between the public
and private sectors; and
the Authority should also consider whether, and
if so to what extent, it would be appropriate for it to make a
funding contribution to support passenger rail services which
are sponsored by local authorities and were approved by the then
Department of Transport prior to the award of first round franchises.
52. The Rail Passenger Partnership fund (RPP) is driven
by proposals from local stakeholders, and reflects genuine local
requirements. It has proved to be a particularly effective way
of stimulating improved integration with other forms of public
transport, and bringing about significant improvements in railway
services. A commitment of £53 million has been made to over
50 schemes in the last three years on new stations, higher frequency
services (such as between Sheffield and Hull), new services, car
parks and park and ride facilities.
53. The RPP was re-launched in January 2002 with funding
of £400 million over 10 ten years, and there are now 140
expressions of interest, some of which will be developed for RPP
submission. Since the re-launch, the volume of applications and
the speed of consideration and approval have improved substantially.
The Authority has been able to provide a decision on formal bids
submitted for RPP funding within four to six weeks of the bid
54. One method the Authority is adopting to achieve significant
improvements in services, and contributing to the economic and
social development of the north of England is through the franchise
replacement process. In particular, the development of improved
inter-urban services (the key driver for the creation of the Transpennine
Express franchise), improvements to cross-country services, and
improving the connections with London remain important elements
of this contribution. In examining proposals for new (or replacement)
franchises, the Authority is bound to consider the wider social
and economic benefits, including from road de-congestion and the
environmental impact of proposals.
55. The major upgrade work on the West Coast Main Line
and the East Coast Main Line will improve transport links to the
north of England from London. Capacity on the West Coast Main
Line is key to achieving the growth targets in the Government's
10 Year Plan.
56. The Authority is represented on the Steering Groups
of the multi-modal studies, which address regional issues. Which
outputs from these studies might be taken forward and how they
will be funded is under discussion with the Department for Transport
(DfT). The Authority will, however, for example, be investigating
the Business Case for a western link to Manchester Airport, which
was a recommendation from the Manchester area multi-modal study.
57. The Authority's "Planning Criteria"
recognise that changes to rail services may bring economic
benefits to a locality or region, particularly if combined with
other measures in a coherent overall strategy. These benefits
do not always create a sustainable increase in employment or income
at a national level and appraisal methodology is not sufficiently
robust to enable these benefits to be monetised.
58. A Business Case should note, therefore, whether and
how a rail proposal is potentially beneficial for a designated
regeneration area (eg Assisted Area); and whether there are significant
developments within or adjacent to the regeneration area which
are likely to be dependent on the rail proposal proceeding (eg
where planning permission is conditional upon rail access). The
Authority is keen to encourage joint sponsorship for projects
with significant regeneration benefits, where these meet the wider
regional objectives of other sponsoring bodies. Several RPP schemes
have been jointly funded on this basis.