APPENDIX 2
Memorandum submitted by London TravelWatch
London TravelWatch is the official watchdog
organisation representing the interests of transport users in
and around the capital. Our response to the questions which the
Committee wishes to address is as follows:
What should be the purpose of passenger rail franchising?
1. We expect the franchising system to deliver
a safe, reliable, frequent, affordable rail service, which provides
a clean, comfortable travel experience.
Is the current system achieving that purpose?
2. The broad picture is very patchy. Some
routes achieve quite good standards, others have significant shortcomings.
This inconsistency contrasts with the high standards on Docklands
Light Railway and generally, with some reservations, on London
Underground.
3. The wide variability of standards arises
from TOCs having different franchise agreements and differing
ideas on what is commercially worthwhile. This is unhelpful in
the quest to achieve a seamless integrated public transport system
in London and the multiplicity of parties now involved in railway
decision making makes for a very slow and convoluted process for
obtaining improvements.
4. Details of our vision and our assessment
of current achievements are as follows.
| London TravelWatch vision
| Current achievements |
| services which run frequently and reliably, at all reasonable times of the day and the week
| Within the London fare zones we look for turn-up-and-go frequencies from about 0600 (0730 Sundays) until after 2400, seven days per week. Only the "one" Liverpool St-Shenfield metro service achieves this.
Most other routes are poor in the evenings and on Sundays, and some which are reasonable during daytime off-peak become poor in the contra-flow direction during the peaks—despite increasing numbers of passengers commuting outwards from or through central and inner London.
Chiltern is notable for making no serious attempt to provide adequate services within London. Under the terms of its franchise it is under no obligation to do so.
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| networks which provide good access to all areas, have adequate capacity, and offer easy interchange between different types of transport
| We recognise that rail cannot provide access to all areas of London, so easy interchange between modes is vital.
Many interchanges between rail and underground (for example Finsbury Park and Ealing Broadway) are poor in both capacity and convenience. Despite almost 10 years of franchising, few have been improved as a result of any initiatives by the franchised operators.
Rail/bus interchange is haphazard, with improvements almost totally reliant on TfL.
The issues of capacity and overcrowding on services to and within London are well known. Whilst some TOCs have been quite ingenious in fine-tuning timetables to concentrate capacity at the times it is most needed, only SWT has taken a co-ordinated approach to crowding by re-drafting its timetable and investing in re-design of its metro rolling stock. Introduction of additional capacity elsewhere has been dependent on funding outside the franchising system, such as SRA/DfT West Coast modernisation for Silverlink County, and TfL sponsoring "PIXC buster" trains on Silverlink Metro.
Where overcrowding is caused by lack of track capacity, the responsibility for investing in track or network improvements lies with government and Network Rail, not the franchisee. However, government funding is often delayed or not made available until the problem reaches a stage where it can no longer be ignored.
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| vehicles which are comfortable, clean, easily accessible, readily identifiable, quiet, non-polluting, and convenient for those travelling with luggage, shopping or small children
| Trains in London are reasonably comfortable, and as most are electric they are quiet and less polluting.
Cleanliness is variable. External cleaning has improved considerably during the last 10 years, but many trains have been allowed to become scruffy and dilapidated internally—notably but not exclusively on Thameslink and Silverlink Metro.
Accessibility and convenience for those with small children, shopping and disabilities etc has barely improved. No attempt has been made to provide level transfer between train and platform. So far as internal layout of metro trains is concerned, only a few new (SET) and refurbished (SWT and Southern) trains provide well-designed flexible spaces for wheelchairs, luggage, buggies etc.
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| staff who are alert, helpful, highly-motivated, well-informed and committed to providing a high quality of service
| Most franchises have increased their passenger-facing staff levels, and have recruited and trained them to be more effective in meeting passenger needs for help and information—assisted by new and relatively cheap technology.
However these improvements have been very much concentrated on the busier stations and times of day. Many stations remain unstaffed from mid-afternoon or early evenings onwards, and with OPO trains almost universal within London this means that many passengers can complete their entire journey without ever seeing any customer-facing staff.
The availability of staff on stations is a topic on which passengers have expressed low satisfaction in the latest National Passenger Survey.
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| journeys which are safe and free from crime or the fear of crime
| Safety in terms of the risk of accident or injury caused by the industry is extremely high—so much so that passengers take it for granted and barely mention it when asked what they expect from the railway. However, personal security has a low satisfaction rating from the latest National Passenger Survey.
Statistics indicate that crime on the railways is low, and certainly no worse than in other public places. However passenger (and non-passenger) perception and fear of crime is significant, perhaps because the physical constraints of being on a train or station make it more difficult to retreat to a place of safety if one feels threatened. Substantial work has been done to address this issue by means of CCTV and associated monitoring centres—albeit largely funded by TfL rather than through the franchising system.
Also some TOCs have introduced security staff (eg, travel safe officers) in the evenings. However these are inevitably thinly spread so most passengers rarely see them, so it must be questionable to what extent they can reduce the fear of crime.
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| information which is intelligible, relevant, accurate, and readily available in appropriate formats both before and during travel
| With the development of NRES into an efficient source of information, coupled with imaginative use of new technology such as web sites, e-mails and text messaging, pre-journey information has improved beyond recognition over the last 10 years.
However many Londoners are much less aware of the rail network and the services it offers than is the case with the Underground. This an issue where fragmentation of Network South-East into individual TOCs has not helped, as there is now no network marketing and no common branding of London area services.
Information during the journey has also improved. However as dissemination and explanation of this depends much more on individual staff taking the initiative to identify and help people in need, standards vary widely between different locations and times of day.
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| fares which are affordable, represent good value for money, and are structured in ways which encourage frequent use
| Generally fares in London are reasonably affordable for most people, but public perception of value for money is poor and wide variations in fares compare badly with the simplicity of TfL/LUL fares. The latest National Passenger Survey shows that across London and the south-east only 35% of passengers are satisfied with value for money—a 5% drop since autumn 2005 despite overall satisfaction with services remaining the same.
Frequent use would be greatly encouraged by the acceptance of Oyster pay as you go on national rail in London. The long delay getting the principle of this accepted is a major indictment of the difficulty of getting system-wide changes in the face of multiple operators and in the mid-term of franchise contracts.
An issue now emerging which causes London TravelWatch considerable concern is the effect of high franchise premium payments to government on fares and on the diversion of funds from rail investment into government coffers. The banning by First Capital Connect of many cheap day return tickets and travelcards from evening peak trains from London—although publicised purely as a crowding reduction measure—is effectively a hidden increase on unregulated fares and one which they surely recognise will be of considerable value to them in meeting the very onerous financial terms of their franchise. This sets a dangerous precedent for the government to milk the busy London and south east TOCs and is tantamount to a tax on tickets.
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| ticket systems which are user-friendly, flexible, and appropriately integrated between different operators and types of transport
| All London area TOCs participate in the TfL travelcard scheme—not necessarily because they want to but because (fortunately) this was made compulsory in the original privatisation scheme. At times this has been used as an excuse for not improving metro area services, as TOCs falsely claimed that they would not receive the increased revenue from the extra traffic thus generated. However this is an argument which has been deployed less frequently of late.
The next stage of flexible integrated ticket systems is Oyster pay as you go. As mentioned above, this has been a very difficult issue, with about two years being wasted whilst individual TOCs and ATOC collectively deployed all manner of, in our view mainly false, arguments for not participating. The impasse has only now been broken by the Mayor offering a major financial inducement to the operators and it will still be at least two more years before passengers will obtain the benefits.
Even this lengthy timescale depends on hitherto antipathetic TOCs negotiating the details willingly and quickly with TfL.
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| stations which are well designed, properly maintained and fully accessible, offering a civilised waiting environment
| This is an area where progress over the last 10 years has been disappointing. Apart from some of the main termini, the inheritance from BR was largely a mixture of dilapidated Victorian structures and 1970s minimalist stations, many also in poor condition.
Railtrack's programme of station renovation in the early years of privatisation substantially addressed the maintenance backlog—albeit outside the franchising structure—but little has been done beyond this and few London suburban stations really offer a civilised 21st century waiting environment, let alone full accessibility.
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| transport providers who are communicative, take complaints seriously, and have proper redress mechanisms when things go wrong.
| Some TOCs have good management systems which enable complaints to be used to address shortcomings in performance.
However many appeals which come to London TravelWatch show a greater concern to process correspondence to meet targets than to fully understand and respond appropriately to passengers' concerns.
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How well does the process for awarding franchises work?
What input do operators, passengers and other interested parties
have into the design of franchised services?
5. London TravelWatch is consulted by DfT and bidders
on the broad principles of new franchises, sometimes including
detailed train service specifications, and all parties are very
willing to meet us to discuss issues.
6. However DfT willingness to change the franchise specification
is generally limited to peripheral issues and they are not interested
in higher standards if these would raise costs. Important examples
of this are their failure to agree to specify—or even engage
in serious discussion of—full turn-up-and-go metro services
for the Greater Western and the Thameslink/Great Northern franchises.
7. Bidder's hear what we say, but won't consult about
their own ideas because of commercial confidentiality and DfT
instructions not to do so.
8. London TravelWatch's influence is therefore much more
by way of general discussions with the industry feeding ideas
into the "conventional wisdom" than by direct input
into specific franchise negotiations.
Has there been a smooth transition of franchising arrangements
from the Strategic Rail Authority to the Department for Transport?
9. So far as London TravelWatch is concerned, yes.
Are franchise contracts the right size, type and length?
What criteria and processes are used to determine the nature
and length of franchises?
10. London TravelWatch is not privy to these criteria
and processes.
11. The original franchises were not determined by a
master plan, but simply took over the sector structure which existed
at the time of privatisation. Thus south of the Thames they were
largely area based, whereas north and west of London they were
defined by service type, ie commuter, inter-city, regional.
12. Recent policy has been to switch to area based franchises,
with the exception of the long distance East and West Coast and
Cross-Country routes. These area based franchises have made it
easier to achieve integrated timetables and operations.
13. The length of franchises has been an issue where
several different policies have been tried. The original franchises
let by OPRAF ranged from seven to 15 years, with many of the longer
ones later collapsing under the weight of unrealistic financial
projections. The SRA initially pursued even longer term franchises,
but only Chiltern's 20 year contract ever saw the light of day.
The latest position is that franchises are let for six to 10 years,
often with automatic extensions for a few extra years if certain
performance targets are met. In the London area this means that
there will be a continuous churn of franchises, and if these continue
to be ones which allow the operators considerable commercial freedom
then it will always be difficult to secure consistent network-wide
standards.
14. A specific problem with franchises as short as seven
years is that, after the very early years, it becomes increasingly
difficult for the operator to justify investment in new facilities.
A case in point is the replacement of worn out and user unfriendly
old BR self-service ticket machines, which operators within two
to three years of the end of their franchise are unwilling to
replace because they say they cannot obtain the pay-back within
the remaining term. There is a mechanism within the legislation
to cater for this situation, by the DfT designating investments
as "franchise assets" for which the operator would be
re-imbursed if they fail to win a renewal, but there appears to
be a reluctance to use this facility. As this will always be a
problem in the London area with one or more franchises nearing
the end of term, London TravelWatch believes this is a matter
which the DfT should address.
What criteria and processes are used to evaluate franchise
bids?
15. London TravelWatch is not privy to these criteria
and processes. However it appears that current criteria lean very
heavily to the lowest subsidy/highest premium bid winning. Given
the many market and other forces which can derail an operator's
financial projections, this is not good news for those who aspire
to higher standards, because the history of franchising to date
shows that the best quality commuter operators—as reflected
by high levels of passenger satisfaction—tend to be those
which are relatively generously funded (eg Chiltern and SWT).
Those which run into financial difficulty or have to fund premium
payments tend to be the ones which become scruffy and second rate
(eg Connex, Thameslink, Thames Trains and the original Prism TOCs)
and which cannot afford to spend money on some of the "soft"
issues which can make an important difference to passengers' perception
of the service.
Do franchise holders deliver value for money to passengers
and the Government throughout the duration of their contracts?
16. The original London area franchises varied widely
in performance and therefore in value for money to passengers.
Examples include Connex—a disaster, Great Eastern—pretty
good as a clean and tidy efficient operator, SWT—a series
of ups and downs but most recently largely up, and Silverlink
& WAGN moving from poor to quite good operationally but still
poor in terms of stations.
17. Chiltern has probably been best for consistency of
delivery and overall quality, but with its focus shifting from
an outer-suburban to a longer distance main line operation it's
overall contribution to London has been weak.
18. The more recent franchises are too new to pass judgement.
Are risks suitably apportioned between the Government and franchise
holders?
19. This is not really a matter for London TravelWatch.
However the current attitude of DfT seems to be to withdraw from
the SRA practice of financially supporting struggling operators.
The consequence is that TOCs committed to large traffic increases
to fund premium or low subsidy franchise contracts but which then
run into trouble may only be able to rescue themselves by cost
cutting—and as pretty well the only costs controlled by
TOCs are staff costs, this can only mean lower standards of service
for passengers.
20. This is not to say that we support the concept of
bailing out unsuccessful private companies. The Connex affair
showed that rapid transfer of a franchise to a public agency,
with a reasonable funding base, can achieve good results—and
can do so much more quickly than if a new contract had to be tendered
or negotiated with a private operator.
What is the scope for improving services through franchise
agreements?
21. Given that TOCs do not control the infrastructure
on which they operate, nor the fabric of the stations they serve,
their scope for improving services on their own is very limited.
22. Whilst they can be held to deliver on whatever they
have signed up to in their franchise agreement, major changes
within a franchise term are very difficult to secure. The franchise
system therefore tends to sterilise services for the duration,
even if circumstances change. Given the speed with which economic
and social change can nowadays take place, this is not helpful.
If franchising is to continue, a mid-term review might be a useful
way to re-set priorities and adjust costs or premium payments
to allow for changing investment and operational needs.
23. An important example of how of the present system
fails to improve things for passenger relates to the proposed
transfer of Class 319 units from Southern to relieve overcrowding
on the Thameslink section of First Capital Connect. The need for
this has been known since long before the draft specification
for the new franchise was issued in June 2005, and the latter
made it clear that additional stock would be needed to operate
the planned new timetable from December 2006. It was also known,
at least to anyone such as SRA/DfT who should have been aware
of Southern's affairs and their rolling stock plans, that the
latter could not release the units without substantially adding
to their own overcrowding problems. The obvious solution was to
transfer Class 458 units becoming spare on SWT to Southern, so
that the latter could release its 319s. Now, a year later (mid
June 2006), no result has been achieved and First Capital Connect
have introduced complex, unfair and difficult to enforce restrictions
on the use of cheap tickets in order—they claim—to
reduce overcrowding. This effectively means that some passengers'
fares will increase by over 100% because of poor planning at franchise
bidding/award stage.
Do we need more competition and vertical integration?
Is franchising compatible with open access operations?
24. This is only an issue which has arisen with long-distance
services—no open access operator has expressed any interest
in running local services in the London area. However it is a
matter of concern for rail industry finances as a whole if an
open access operator can run on the network without paying a contribution
to the fixed overhead costs of the system, and can thus undercut
a franchised operator whose fares have to allow for the latter
(and also perhaps a premium to government). This effectively means
that public funds are transferred to a private company without
the need for the latter to take on any public service obligation.
This situation is only worsened if the open access operator is
also allowed to use the ORCATS system to take a share of the franchised
operator's revenue regardless of the number of passengers actually
carried. London TravelWatch does not consider that this can be
called fair competition.
25. Competition can of course occur between franchised
operators, either where two operators share a route or where adjacent
routes serve the same towns. In the London area this competition
has been largely limited to TOC specific fares to get round the
ORCATS rules. This has resulted in complex fare scales and rules
which passengers—and sometimes staff as well—find
difficult to understand. The most notorious examples have been
on the London—Gatwick—Brighton corridor between Connex/Southern,
Thameslink and Gatwick Express, and they have been a contributory
factor to the knot the industry has created for itself over the
Brighton line RUS and the inefficient use of the capacity of the
Gatwick Express trains.
26. It has long been said that the real competition issue
for railways is not competition between operators, nor even with
other public transport modes, but competition between rail and
the private car.
Should train, rolling stock and track operation be more closely
integrated?
27. This topic came to the fore post-Hatfield, when the
virtual collapse of the railway in terms of both operating and
engineering led to the fragmentation of the British method of
privatisation being questioned.
28. Action since then to establish more co-operative
working within the industry has largely solved these problems,
particularly with the establishment of joint control centres between
TOCs and Network Rail in which one party (normally Network Rail)
is allowed to take tactical operational decisions in the interests
of users as a whole.
29. Also, the establishment of Network Rail enables it
to take a long-tern view of infrastructure requirements, and provides
continuity for improvement work even though the franchise holder
may change during the course of a major project.
30. However a big problem remains in terms of how to
secure progressive improvements in service in a world where responsibilities
within the industry are fragmented. An inordinate amount of time
is spent trying to persuade multiple parties, none of whom has
sole responsibility, and each of whom can if it suits them profess
agreement with an objective but blame someone else for inability
to deliver. This contrasts with how decisions could previously
be taken under a system with an element of centralised command
and control. Some form of vertical integration (including consideration
of the issues around rolling stock ownership) might resolve this
problem, but it is clearly a major issue which would need wide
debate.
31. One form of integration which has been publicly suggested
is that part of the network where there is one dominant TOC might
be vertically integrated by transferring Network Rail's responsibility
to the former. However this would transfer responsibility for
the maintenance of and investment in ultra-long life assets to
organisations whose role in the industry is not guaranteed for
the long term. This is not an idea which London TravelWatch would
favour.
32. However, the proposed arrangement for the forthcoming
North London Railway concession to be funded and administered
by Transport for London will adopt the very successful model used
by TfL for the Docklands Light Railway. The operator will run
a service, specified in detail by TfL, who will set the fares,
look after publicity, take the revenue risk and take responsibility
for dealing with Network Rail on infrastructure matters. London
TravelWatch hopes that this arrangement will be a success, and
that its eventual extension across the whole of London will provide
the means—at long last of—of securing an integrated
and consistent public transport system for the capital.
Franchise names
33. A small but important issue is the matter of franchise
names. The original names inherited from the previous sector organisation
had a geographical basis from which people could fairly easily
infer their areas of operation. It is extremely unhelpful that
franchises have been allowed to adopt meaningless brand names
such as Silverlink, "one" and c2c, and even worse that
new operators are allowed to change the names at whim. This does
nothing to help people understand the network and the services
it provides.
34. The worst case is the replacement of the name Thameslink
by First Capital Connect, on the grounds that it has a bad image.
The Thameslink name, in less than 20 years, has established a
strong identity as the only cross-London rail line, and is used
in a similar way by passengers to the Underground lines. It is
highly confusing for passengers—and potential passengers—to
have that name disappear. Franchises are let for a short time
and it is not desirable to keep changing well-known and well-understood
names. London TravelWatch considers that DfT should exert much
greater control over franchise names and only permit them to be
changed in exceptional circumstances.
19 June 2006
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