1 Holding the rail industry to account
for the performance of passenger services
1. The performance of the rail industry has improved
since the Hatfield derailment of October 2000, which resulted
in widespread speed restrictions and engineering works that severely
reduced performance for several years.[2]
In addition, the number of passenger services has increased from
18,000 trains running each day in 2000, to 22,000 in 2007. This
expansion means that, when problems do occur, they can cause greater
disruption to passengers, making it more important to avoid incidents
that can be prevented and to resolve others quickly.[3]
And, despite the improvements that have been made, delays in 2006-07
still cost passengers around £1 billion in terms of time
lost.[4]
2. The Train Operating Companies and Network
Rail are taking action to reduce the number of incidents for which
they are responsible. Train faults cause the most delays; over
20% of all delays that occurred in 2006-07, despite Train Operating
Companies having invested in new trains. Under the rail industry's
performance arrangements Network Rail is held responsible for
delays caused by infrastructure, as well as those caused by external
factors such as bad weather. In 2006-07, these faults caused 62%
of delay minutes.[5] Since
2002, Network Rail has gradually reduced delays for which it is
responsible (Figures 1 and 2) and it is investing nearly
£9 billion on renewing the West Coast Main Line. Nevertheless,
services on that route are still regularly delayed by faults in
cables, overhead lines and signals.[6]
This reflects the age and reliability of the infrastructure, with
some parts up to 60 years old. In addition, this line is the most
intensely used stretch of railway, with some sections of track
needing replacement every five years.[7]
3. During 2006-07, Network Rail received £3.4
billion in grants from the Department for Transport (the Department),
and £2.2 billion in track access charges from Train Operating
Companies.[8] In June 2008,
the Office of Rail Regulation announced that, for the period 1
April 2009 to 31 March 2014, Network Rail will receive £16.4
billion in direct grants from the Department, £6.6 billion
from train operators, and £3.6 billion in other income.[9]
Figure 1:
Delay minutes attributed to Network Rail
Note: This chart
includes delay minutes caused by Railtrack/Network Rail that were
incurred by both passenger and freight
services.
Sources: Office of Rail Regulation Annual Assessment
of Network Rail 2006-2007. Network Rail Annual Report 2007-2008,
C&AG's Report, Figure 3
Figure
2: Public Performance Measure showing the percentage of trains
arriving "on time"
Note: A train is
defined as "on time" if it arrives within five minutes
of the planned destination arrival time for London South East
and Regional operators, and within ten minutes for Long Distance
operators.
Sources: Office of Rail Regulation Annual Assessment
of Network Rail 2006-2007: Network Rail Annual Report 2007-8,
G&AG's Report, Figure 3
4. The structure of the rail industry is complex
and accountability lines are confusing. The Department sets the
high level rail requirements which the rail industry must deliver.
It also enters into and monitors franchise agreements with Train
Operating Companies in England. The Office of Rail Regulation
is the economic regulator for the industry. It monitors the performance
of Network Rail and can take enforcement action if necessary.
Network Rail is responsible for the overall performance of the
rail network and for the operation of the network in the interests
of passengers. Train Operating Companies run the passenger services
set out in their franchise agreements with the Department.[10]
5. Ultimately, the Secretary of State for Transport
is accountable to Parliament for the performance of the railways
and Network Rail is responsible for delivering the requirements
specified by the Secretary of State.[11]
Network Rail is a private sector company and is not accountable
to Parliament, despite receiving over half of its income in Government
grants. Its Chief Executive is not an Accounting Officer, and
so the Committee of Public Accounts cannot hold him, or Network
Rail, to account.[12]
There are also gaps in the accountability of the three major companies
that own the passenger train rolling stock and lease it to the
Train Operating Companies. These companies are not regulated and
do not take any responsibility for the condition of the trains,
even when they cause delays. The Competition Commission is considering
a complaint from the Department about the position of the rolling
stock companies.[13]
6. The Department sets targets for the Train
Operating Companies while the Office of Rail Regulation sets them
for Network Rail.[14]
There is a risk in any target regime that, in order to meet their
targets, organisations will take action which is not necessarily
in the interests of their customers. The Association of Train
Operating Companies and Network Rail argue that this is not the
case in the rail industry. For example, on one occasion in 2006-07,
Network Rail kept services running in extreme weather when operators
in Holland, Germany and France cancelled most of their services.
Network Rail believed its decision was in the best interests of
passengers, but running trains in difficult weather on that occasion
caused 250,000 delay minutes, which affected its performance for
the whole year.[15]
7. The Office of Rail Regulation sets targets
for Network Rail too far in advance and does not revise them frequently
enough to be realistic and challenging. For example, the target
for 2006-07 was set in 2004 and was lower than Network Rail's
own internal target.[16]
The Office of Rail Regulation has set Network Rail a new performance
target that by 2013-14, 92.6% of passenger services must arrive
on time.[17] It is not
due to set any fresh targets, however, until 2014-15, so again
it cannot react to changing circumstances.[18]
2 Q 95; C&AG's Report, para 1.12 Back
3
Qq 8, 48 Back
4
C&AG's Report, para 1.1 Back
5
Q 19; C&AG's Report, paras 1.12-1.14, Figure 21 Back
6
Q 9; C&AG's Report, Figure 24; C&AG's Report, The Modernisation
of the West Coast Main Line, HC (2006-07) 22, para 2.16 Back
7
Qq 31-32 Back
8
C&AG's Report, Reducing passenger rail delays by better
management of incidents, HC (2007-08) 308, Figure 1 Back
9
Office of Rail Regulation, Periodic Review 2008: Draft determinations,
June 2008 Back
10
C&AG's Report, paras 1.4-1.8 Back
11
C&AG's Report, para 1.8 Back
12
Qq 1-4 Back
13
Qq 85-93 Back
14
C&AG's Report, paras 1.4, 1.5 Back
15
Qq 9-10, 39 Back
16
Qq 12-15 Back
17
Qq 14-15, 95 Back
18
Qq 12-15 Back
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