Select Committee on Public Accounts Minutes of Evidence


Examination of Witnesses (Questions 180-199)

DFT, ATOC, NETWORK RAIL, ORR AND SRA

12 OCTOBER 2005

  Q180  Mr Davidson: So during that period every situation where you identified inefficiency in a station it got resolved, did it?

  Mr Newton: It got addressed in some way or another.

  Q181  Mr Davidson: So there should be no station during that period where there was any cause for concern because you had the methodology to get it resolved?

  Mr Newton: No. It was those transgressions that were identified by monitoring.

  Q182  Mr Davidson: So only if you noticed it? On any occasion when you noticed anything wrong it was always resolved?

  Mr Newton: In some form or another, yes.

  Q183  Mr Davidson: What does "in some form or another" mean? It either means yes or no.

  Mr Newton: It might be a phone call to the operator and they can put it right. It might be an inaccurate notice displayed, any number of things.

  Q184  Mr Davidson: But it got sorted out?

  Mr Newton: Yes.

  Q185  Mr Davidson: Let us be clear then. During this period 2004-05, if there was any situation where there was an inadequacy in station provision, that was only because you had not spotted it because any time you did spot it it was resolved? Is that correct?

  Mr Newton: Action was taken, yes. Whether it was resolved immediately is another matter.

  Q186  Mr Davidson: That is interesting. Can I go to paragraph 2.19 though where it says that the SRA reviewed this franchising policy in 2002 and concluded—and there are a couple of other clauses—that overall it had not delivered the outcomes envisaged, which I take it means it did not work. Why do you think it did not work? Why do you think it was a failure?

  Mr Newton: It did not work, as I referred to earlier, because the early franchise agreements were predicated on a number of assumptions which did not materialise. The key one was that the operators would have commercial incentives to address all the quality and investment issues needed at stations.

  Q187  Mr Davidson: So if they were not getting funded for it they were not doing it? There was no sense of responsibility on their part that they ought to upgrade stations or maintain them adequately?

  Mr Newton: No. As I say, the assumption was that there would be a commercial incentive for the operator to address all the quality requirements at stations.

  Q188  Mr Davidson: I do not quite understand that point but presumably that means that if the operator did not upgrade the station they got the passengers anyway and therefore there was no incentive for them to maintain the station adequately. Is that a fair way of putting it?

  Mr Newton: No. The presumption was that they would generate revenue from doing all the things that were required at stations so that would be a justifiable expenditure by them and they would therefore undertake the expenditure. That was a flawed assumption.

  Q189  Mr Davidson: Indeed it was. You then had to move to a situation with the new franchise agreements where it was much more specific, was it not, which is an indication really that under the previous arrangement the train operating companies were not doing what you thought they ought to?

  Mr Newton: That presumption did not materialise, yes.

  Q190  Mr Davidson: So that is a yes then, is it?

  Mr Newton: The franchise policy change in 2002 addressed that deficiency.

  Q191  Mr Davidson: That is a yes then. Am I right in finding it quite astonishing that in dealing with train operating companies, all of whom apparently apart from one were making substantial sums of money, you had to specify that where they had toilets, for example, they had to be open because under the new franchise agreement it is specified that the toilets have to be open, so presumably under the previous arrangements they could have toilets but they did not actually need to be open? Also, the toilets have to be clean, which presumably was not the case before, and at least 50% of cubicles or urinals have to be available when the station is manned. It really does not say very much for the train operating companies before that they were not prepared to do that and you had to specify that. Is that fair?

  Mr Newton: Yes. I am saying that it identifies the fact that the early franchising policy was flawed in assuming that would happen.

  Q192  Mr Davidson: They did not do it; that is right. Coming back to the original franchise agreements for adequate lighting, you had to specify that lights should not be flickering; they should meet the required lux level. That is a pretty damning indictment of the train operating companies again, is it not?

  Mr Newton: It is an indictment of the inadequacy of the early franchise agreements.

  Q193  Mr Davidson: That is right. Who drew up the early franchises?

  Mr Newton: The Office of Passenger Rail Franchising, driven by the key criterion, which was that the lowest bid won. That was the selection criterion.

  Q194  Mr Davidson: I think it is fair, Chairman, to mention my own particular favourite, which was that in the original franchise agreement it said that the environment had to be kept reasonably clean but the new specification was that the person employed to pick up litter on the platforms must be instructed not to sweep the litter onto the track bed, which presumably was what the train operating companies were doing before because there was no commercial incentive there for them not to sweep the litter off the platform onto the track bed. Does that sound to you like the action of responsible people?

  Mr Newton: No, but it is one of the reasons that justified the franchise policy review which was published in 2002.

  Q195  Mr Davidson: Mr Muir, the train operating companies, it would appear, could not be trusted further than you could throw them to behave responsibly. Is that reasonable?

  Mr Muir: No.

  Q196  Mr Davidson: Why did you have to be specifically instructed not to sweep the litter onto the track beds?

  Mr Muir: It would indeed be irresponsible, whether instructed or not, for station staff to sweep litter onto the track bed. If they do it it does not, as it happens, help the financial position of the train operator because if we have to clear litter off the track in a station the train operator has to contribute to the cost of doing it. It is mere stupidity by the staff.

  Q197  Mr Davidson: Why do you think you had to have it specified to you that it had to be done? Presumably there would be a saving because the wind would remove much of the litter onto neighbouring properties over a period, as anyone in the area round about stations will have seen.

  Mr Muir: It was specified. Lots of things get specified. It did happen but it should not have happened and it should not have happened anyway.

  Q198  Mr Davidson: I wonder if I could come to another section, 3.15, where there has been a noticeable increase in the figures, and that is relating to crime. From 2001 to 2002 and 2003 to 2004 there was a 17% increase in crime on the railways. To what extent do you think that is accounted for by cost cutting by the train operating companies?

  Mr Muir: Can I just please address that paragraph? As you say, it is paragraph 3.15. It is comparing a change between the years 2000-01 and 2003-04. During that period there was a change of method of recording and in April 2002, halfway through the period, the National Crime Recording Standard was introduced which changed the numbers. If you adjust for that change the overall increase of 17% would be a decline of 5%.[15]

The adjustments arising from the change in the method in recording are complex and the figure we gave of 5% is not correct.

See also Ev 29.

  Q199 Mr Davidson: Did you have the opportunity to see this Report?

  Mr Muir: Yes, I did.


15   Note by witness: We have been in discussion with the NAO regarding the percentage change in total crime, stated as 17% in the Report. At the Committee I said this figure should have been a decline of 5%. Back


 
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