Memorandum by the Strategic Rail Authority
(RR 26)
RURAL RAILWAYS
INTRODUCTION
The Strategic Rail Authority has outlined its
ideas on local and rural railways in a consultation paper on Community
Rail Development, published on 26 February. Following the closing
date for consultation on 28 May, a strategy for Community Railways
is to be developed for submission to the Secretary of State in
July. The Committee's inquiry into rural railways is therefore
timely and a welcome input into the development of this strategy.
The proposals are still at the formative stage
and the final strategy has yet to be written. In particular, more
work is needed to determine the actual costs of these lines, to
define the appropriate standards for their specification and to
look at how the developments planned would be delivered contractually.
The ideas developed in the consultation paper
fit within the overall strategy of the SRA which is focussed on
improving performance and on regaining control of the costs of
the railway. This will be achieved through establishment of a
strategic framework, proper specification of requirements and
differentiated standards reflecting the varying requirements of
different parts of the railway.
OBJECTIVES
The underlying objective of these proposals
is to put local and rural railways on a sustainable basis for
the medium to long term. The strategy is being developed as a
framework to facilitate the development of local solutions for
each route. It is not designed as a template to be applied across
the board. The characteristics of the 60 routes listed are very
different, but the approach provides a menu of initiatives that
can be grouped to form the right solution for each line.
The other key objectives of the policy are set
out below:
— To provide a separately designated
network focussed on meeting local needs and specified accordingly,
following the approach adopted in France and Germany.
— To provide for greater local involvement
in planning local transport requirements around the capabilities
of community railways. In the longer term, this could lead to
a transfer of resources to allow these lines to be specified and
funded locally or regionally.
— To overcome the institutional impediments
to deliver small scale locally funded improvement projects and
to encourage community support and involvement through initiatives
such as station adoption. The aim should be to make it easy for
the local community to invest their time and money in their local
railway—not for the industry to put stumbling blocks in
their way.
— To allow the introduction of initiatives
that are appropriate to the local needs of passengers and freight
customers without the requirement to make them applicable across
the network.
INITIAL RESPONSES
The initiative outlined in the consultation
paper has been widely welcomed and generally endorsed by passenger
groups, amenity and pressure groups and local authorities. Some
of the issues raised in the responses received so far are set
out below, together with a commentary.
Funding
Some respondents have expressed disappointment
that the initiative does not come with additional SRA funding.
The taxpayer, through the SRA, already contributes substantially
to these routes through franchise support payments, and the aim
of the strategy is to improve the value of every £ of taxpayers
support, and to provide a framework to allow local communities
to contribute directly to further development.
Light rail
A number of consultants and promoters of intermediate
technology have responded to promote the use of their own systems
including light rail, ultra light rail, monorail and tracked hovercraft,
as a solution to the rural railways problem. All these projects
require high start up capital costs for specialised infrastructure
and rolling stock, whereas the strategy will be aimed at achieving
better results with the resources that are already available.
Bus substitution
Some respondents have suggested that rail services
could be replaced by buses to release resources for the rest of
the network. Whilst the paper acknowledges the potential role
of bus in feeding the trunk rail route, or in supplementing an
infrequent rail service, the strategy itself is being developed
as an alternative to permanent replacement by buses, for the reasons
set out in the consultation paper.
Line reopening
Several respondents have asked if the strategy
would allow designation of heritage lines or the reopening of
closed lines. The strategy is focussed on improving the performance
of the existing franchised network, and there is neither the resource
nor the funding to embrace existing heritage lines or future line
reopenings.
Fares
Some respondents have expressed opposition to
fares increases on these lines, while the retention of network
benefits of through ticketing and information have been endorsed
as a principal requirement. Clearly, fares have to reflect the
market position, but rail is a premium mode, with its own infrastructure,
specialist vehicles, and consequently high fixed costs. It should
not generally underprice bus, and in particular, fares policy
could be used to facilitate the introduction of interavailable
ticketing where bus and train can provide a complementary service.
It is intended to retain the benefits of through ticketing and
of information via the National Rail Enquiry Service, while allowing
flexibility for easier application of local fares offers.
Specification
Some respondents have expressed a desire to
keep all options open, by specifying that lines should be capable
of handling freight and locomotive hauled trains, even if there
is no current demand for them. This would however result in over-specification
and higher costs which in the long run may undermine the sustainability
of the routes concerned.
Freight routes
Some respondents have questioned the inclusion
of lines carrying freight. Specification of Community Railways
would be designed to reflect the traffic actually carried—including
freight, and the approach may allow some innovative approaches
to freight which could attract new traffic where high rail unit
costs prevent this at the moment. Freight operators have highlighted
one or two routes proposed for designation where heavy freight
flows predominate, and these will be removed from the list if
it is unlikely that any benefit would accrue from designating
them.
TENs routes
Some respondents have asked why some routes
(particularly in Scotland) are not included. These are routes
already designated as Trans European Network routes which clearly
could not be designated as Community Railways as one of the proposals
made in the consultation paper is that some EU requirements, such
as those on interoperability, should not be applied when the regulations
come into force.
COSTS AND
BENEFITS
Overall, the regional network requires £850
million subsidy pa. Within this, the cost base of the 60 lines
listed for possible Community Rail designation is not identifiable
under the present rail accountancy systems. Work is under way
to establish these costs and to produce a "balance sheet"
for the routes concerned.
The principal potential for cost reductions
lies in:
— Identifying the actual cost requirement
of these routes and services, reducing overhead costs where these
are not required.
— Planning on the basis of programme
of longer track maintenance possessions to allow continuous work
to be undertaken at off-peak times rather than in short and relatively
inefficient working periods at premium rates at nights and weekends.
This will be particularly effective on routes with low winter
usage, to ensure 100% availability and reliability during the
peak summer season.
— Moving to more consistent local planning
of track maintenance, rather than an approach which is driven
by the need to carry out periodic palliative maintenance to meet
current response times to recorded variations in track condition.
— Maintenance cycles (and renewals
where required) based on the traffic actually carried—ie
for lightweight passenger trains only, where no freight or locomotive
hauled trains normally operate.
— Reductions in train leasing costs
where older vehicles are used, particularly to provide additional
capacity to meet seasonal peak demand.
— In some cases, reduction in costs,
or improved outputs, through multi-skilling of staff (eg training
train crew to deal with points failures at remote locations).
The originating revenue for these 60 lines is
some £45 million, with a further contributory revenue of
around £35 million reflecting the "feeder" role
of these lines to the main line network. Work is under way to
identify the potential for increasing ridership and revenue, and
there is scope to do this under four headings:
— better promotion and marketing, raising
the profile of the railway within the community;
— improving revenue protection by making
it easier to buy tickets before boarding the train (and improving
on-train inspection);
— improving the fares yield through
selective pricing, especially where rail fares are lower than
those for parallel bus services; and
— promotion through Community Rail
Partnerships of services for special events such as fairs, carnivals,
sporting events, music trains, or trains for ramblers.
In addition to this, there is the ancillary
income referred to in the consultation paper, and the spending
power of extra visitors in the local economy, so that a 1% increase
in ridership should produce more than a 1% increase in economic
activity locally. This may be increased further where railway
property is used to generate economic benefit, for example, where
redundant station buildings have been converted to a travel agency
or restaurant.
CONCLUSION
The initial phase of the consultation on this
developing strategy shows considerable support for the concept
of developing local and rural railways on a sustainable basis,
but some initial unwillingness to confront some of the difficult
choices that will deliver this. The principles are worth pursuing
to maximise the value of the rural parts of the present network
and to secure closer community involvement in their development.
Much remains to be done on costs, standards and providing a contractual
and regulatory framework that encourages local investment and
involvement. The potential financial benefits are worthwhile,
and the scope for greater contribution by the rural railway to
the local economy is significant. The views of the Committee will
be welcome in further development of the strategy.
Chris Austin
Strategic Rail Authority
19 April 2004
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