Railways Bill

House of Commons

Session 2004 - 05
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Other Bills before Parliament

Railways Bill

Railways Bill
Part 2 — Public sector funding authorities for railways
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12
Transfer schemes at end of franchising agreements
(1)
This section applies where a franchise agreement is or has been in force.
(2)
The appropriate national authority may make a scheme for the transfer, at or
after the end of the franchise period, of relevant franchise assets from the
franchise company to a person specified in subsection (3), or to two or more of
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those persons.
(3)
Those persons are—
(a)
the Secretary of State;
(b)
the Scottish Ministers;
(c)
a company which is wholly owned by the Secretary of State or the
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Scottish Ministers;
(d)
a company which is jointly owned by the Secretary of State and the
Scottish Ministers; and
(e)
a franchise company.
(4)
Before making a scheme under this section, the appropriate national authority
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must consult every person to whom relevant franchise assets would be
transferred under the proposed scheme.
(5)
On the day on which a scheme made under this section comes into force—
(a)
the transferee or transferees must pay to the transferor, or
(b)
the transferor must pay to the transferee or transferees,
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such sums as may be specified in, or determined in accordance with, the
franchise agreement.
(6)
Subsection (5) is subject to any other agreement between the transferor and the
transferee or transferees.
(7)
Schedule 2 (which contains supplemental provisions about transfer schemes)
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has effect in relation to schemes under this section.
(8)
In this section—
“the appropriate national authority” means—
(a)
in relation to a franchise agreement to which the Secretary of
State is a party, the Secretary of State; and
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(b)
in relation to a franchise agreement to which the Scottish
Ministers are a party, the Scottish Ministers;
“franchise company” means a person who is, or is to be, the franchisee or
the franchise operator under a franchise agreement;
“relevant franchise assets” means property, rights and liabilities which,
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immediately before the end of the franchise period which is ending or
has ended, will be or were designated as franchise assets for the
purposes of the agreement;
“transferee”, in relation to a scheme, means a person to whom property,
rights or liabilities are transferred in accordance with the scheme; and
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“transferor”, in relation to a scheme, means the person from whom
property, rights or liabilities are transferred in accordance with the
scheme.

Railways Bill
Part 2 — Public sector funding authorities for railways
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Passenger Transport Executives
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Railway functions of Passenger Transport Executives
(1)
Before—
(a)
issuing an invitation to tender for a franchise agreement in a case in
which the services to be provided under the agreement are or include
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services in which a Passenger Transport Executive for an area in
England have an interest, or
(b)
entering into a franchise agreement in respect of such services in a case
in which no such invitation has been issued,

the Secretary of State must consult the Executive for that area.
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(2)
For the purposes of subsection (1) the services in which a Passenger Transport
Executive have an interest are—
(a)
services for the carriage of passengers by railway within the passenger
transport area of that Executive; and
(b)
services which are not such services but are services for the carriage of
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passengers by railway to or from such an area.
(3)
A Passenger Transport Executive for a passenger transport area in England
and the Secretary of State may enter into arrangements under which one or
both of the following occurs—
(a)
sums become due from the Executive to the Secretary of State in respect
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of services for the carriage of passengers by railway within that area or
in respect of station services or bus substitution services provided
within that area; and
(b)
the Secretary of State undertakes to exercise or perform his powers and
duties in relation to or in connection with such services in a particular
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way.
(4)
A Passenger Transport Executive for a passenger transport area in England
may enter into agreements for purposes relating to or connected with the
provision, by a person who is a franchisee or franchise operator in relation to a
franchise agreement, of—
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(a)
services for the carriage of passengers by railway within that area; and
(b)
station services provided for purposes connected with any such
services.
(5)
A Passenger Transport Executive for a passenger transport area in England
may not enter into an agreement (whether by virtue of subsection (4) or
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otherwise)—
(a)
with a person who is a franchisee or franchise operator in relation to a
franchise agreement, or
(b)
with a person who is proposing to become such a franchisee or
franchise operator,
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unless the agreement is approved by the Secretary of State.
(6)
The Secretary of State may—
(a)
give a general approval for the purposes of subsection (5) in relation to
a description of agreements, as well as specific approvals for particular
agreements; and
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(b)
withdraw his approval in relation to any agreement at any time before
the agreement is entered into.

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Part 2 — Public sector funding authorities for railways
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(7)
The agreements to which a Passenger Transport Executive for a passenger
transport area in England may become a party with the approval of the
Secretary of State include franchise agreements under which services are
provided which are or include services for the carriage of passengers by
railway within that area.
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(8)
The Secretary of State and the Passenger Transport Executive for a passenger
transport area in England must each provide to the other any information
which—
(a)
the other reasonably requires for purposes connected with his or their
functions in relation to railways or railway services; and
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(b)
is information which it would have been lawful for him or (as the case
may be) them to disclose apart from this subsection.
(9)
In this section—
(a)
a reference to a service for the carriage of passengers by railway within
a passenger transport area is a reference to a service for the carriage of
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passengers by railway between places in that area or between places in
that area and places outside it which are within the permitted distance;
(b)
a reference to station services provided within such an area is a
reference to station services provided in connection with any such
service for the carriage of passengers by railway; and
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(c)
a reference to a bus substitution service provided within such an area
is a reference to a bus substitution service for the carriage of passengers
between places in that area or between places in that area and places
outside it which are within the permitted distance;

and in this subsection “the permitted distance” has the same meaning as in
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section 10(1)(ii) of the Transport Act 1968 (c. 73) (25 miles).
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Repeals and savings relating to Passenger Transport Executives
(1)
The following provisions shall cease to have effect—
(a)
in section 10(1) of the Transport Act 1968, paragraphs (vi) and (viza)
(powers to enter into agreements with the SRA);
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(b)
section 20(2)(b) and (3) of that Act (duty of PTE to enter into agreements
to secure the provision of railway passenger services and to provide
information for that purpose); and
(c)
sections 34 and 35 of the 1993 Act (role of PTAs and PTEs in relation to
franchising and the termination and variation of agreements under
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section 20(2) of the 1968 Act).
(2)
Subject to subsection (3), a Passenger Transport Executive who are a party to a
franchise agreement immediately before the commencement of subsection (1)
may continue to be a party to that agreement after that time, notwithstanding
anything in subsection (1) of this section or in section 13.
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(3)
Where a Passenger Transport Executive are a party to a franchise agreement
immediately before the commencement of subsection (1) of this section—
(a)
subsection (2) of this section and section 13(4) and (7) are to be
disregarded for the purpose of giving effect to any provision of the
agreement by virtue of which a person may cause the Executive to cease
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to be a party to it; and

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Part 2 — Public sector funding authorities for railways
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(b)
the Executive must comply with all such directions as may be given to
them by the Secretary of State to take steps for the purpose of ceasing
to be a party to the agreement.
(4)
The provisions of this section and the repeals made by this Act do not affect the
application of the following provisions in relation to a franchise agreement into
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which a Passenger Transport Executive entered before the commencement of
subsection (1) of this section, that is to say—
(a)
subsection (17) of section 34 of the 1993 Act (disputes); and
(b)
any other enactment so far as it has effect for the purposes of or in
relation to that subsection of that section.
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(5)
In the operation of any enactment by virtue of subsection (4) of this section
references in that enactment to the Strategic Rail Authority are to have effect as
references to the Secretary of State.
London
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Duty of Secretary of State and Transport for London to co-operate
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(1)
Section 175 of the Greater London Authority Act 1999 (c. 29) (duty of Transport
for London and the SRA to cooperate) is amended as follows.
(2)
In subsection (1) (duty of co-operation)—
(a)
for “Strategic Rail Authority”, where first occurring, substitute
“Secretary of State”; and
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(b)
omit the words after paragraph (b) (which relate to the exchange of
information).
(3)
After that subsection insert—
“(1A)
Before—
(a)
issuing an invitation to tender for a franchise agreement in a
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case in which the services to be provided under the agreement
are or include London railway passenger services, or
(b)
entering into a franchise agreement in respect of such services
in a case in which no such invitation has been issued,

the Secretary of State must consult Transport for London.
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(1B)
The Secretary of State and Transport for London must each provide to
the other any information which—
(a)
the other reasonably requires for a purpose mentioned in
subsection (1)(a) or (b); and
(b)
is information which it would have been lawful for him or (as
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the case may be) it to disclose apart from this subsection.”
(4)
In subsection (2) (power of Transport for London and SRA to enter into
arrangements as to how they will exercise and perform their functions), for
“Strategic Rail Authority” substitute “Secretary of State”.
(5)
After that subsection insert—
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“(2A)
Those arrangements may include arrangements under which sums
become due from Transport for London to the Secretary of State—
(a)
in respect of London railway passenger services;

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Part 2 — Public sector funding authorities for railways
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(b)
in respect of station services provided in connection with such
services; or
(c)
in respect of bus substitution services provided as alternatives
for London railway passenger services.
(6)
In subsection (3) (references to functions of the SRA), for “Strategic Rail
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Authority”, “its” and “it” substitute, respectively, “Secretary of State”, “his”
and “him”.
(7)
After that subsection insert—
“(3A)
A reference in this section to a London railway passenger service is a
reference to—
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(a)
a service for the carriage of passengers by railway between
places in Greater London; or
(b)
a service for the carriage of passengers by railway between
places in Greater London and places outside Greater London.
(3B)
Expressions used in this section and in Part 1 of the Railways Act 1993
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have the same meanings in this section as in that Part.”
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Relaxation of contractual restrictions on Transport for London
(1)
Section 201 of the Greater London Authority Act 1999 (c. 29) (restriction on
Transport for London entering into agreements that involve the holding of a
licence under the 1993 Act) shall cease to have effect.
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(2)
Transport for London may not enter into an agreement—
(a)
with a person who is a franchisee or franchise operator in relation to a
franchise agreement, or
(b)
with a person who is proposing to become such a franchisee or
franchise operator,
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unless the agreement is approved by the Secretary of State.
(3)
An agreement that relates exclusively to the grant of permission by a facility
owner for a person to use a railway facility of his does not require the approval
of the Secretary of State under subsection (2) in any case in which Transport for
London or a subsidiary of its is the facility owner or the person granted
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permission.
(4)
The Secretary of State may—
(a)
give a general approval for the purposes of subsection (2) in relation to
a description of agreements, as well as specific approvals for particular
agreements; and
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(b)
may withdraw his approval in relation to any agreement at any time
before the agreement is entered into.
(5)
The agreements to which Transport for London may become a party with the
approval of the Secretary of State include franchise agreements under which
services are provided which are or include services for the carriage of
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passengers by railway between places in Greater London.
(6)
In this section “subsidiary” has the meaning given to it by section 736 of the
Companies Act 1985 (c. 6).