2 Cross-border rail services |
8. Over 8 million passenger journeys were made
by rail between England and Wales in 2009-10. This represents
more than a quarter of all rail journeys beginning or ending in
Wales. Cross-border rail travel is thus an important everyday
occurrence for Welsh commuters, business people and visitors.
Cross-border services have seen significant growth in passenger
numbers in recent years, and it is expected that demand will further
increase in the future.
First Great Western said that its Cardiff to Bristol service had
seen particularly high growth due to an increase in commuters
between South Wales and Bristol.
Arrivawhich operates several cross-border servicestold
us that its cross-border routes had seen the highest increase
in passenger numbers in recent years, with passenger numbers increasing
by around 8-13% a year.
Government investment in cross-border
9. The Government has announced significant investment
in cross-border rail routes between England and Wales in the last
two years, as well as key commuter routes in South Wales. This
amounts, directly and indirectly, to almost £2 billion. Electrification
of the Great Western Main Line (GWML) will be extended to Swansea,
and the Cardiff Valleys lines will also be electrified, at a cost
of £350 million (in addition to the £1 billion electrification
programme already announced for the GWML). Passengers between
South Wales and Heathrow will also benefit from a £500 million
commitment to build a rail link between the GWML and Heathrow.
The previous Secretary of State for Wales Cheryl Gillan described
these commitments as "the most significant infrastructure
announcement for Wales for decades."
10. Since then, further progress has been made
on the case for electrification of rail lines in North Wales,
an area with historical under-investment in rail infrastructure.
There is also an ongoing debate about how the Government's proposed
new high speed line from London to the north of England will affect
Wales, and whether Wales can be part of a future high speed network.
We explore each of these issues below.
Electrification in South Wales
11. The use of modern electric trains rather
than older, diesel engines can improve reliability and performance
and reduce journey times. The cascade of electric rolling stock
onto electrified Welsh lines would also release carriages to provide
additional capacity for other cross-border services. Our predecessor
Committee looked at the benefits that electrifying lines previously
served by diesel trains would have for passengers travelling between
England and Wales, and recommended that the whole South Wales
Main Line be electrified in order to significantly improve services
available to passengers.
The DfT subsequently announced in March 2011 that the GWML would
be electrified from London to Cardiff but that there was not a
viable business case for electrification of the line between Cardiff
12. Following this announcement, we pressed again
for electrification on the GWML to be extended to Swansea in our
February 2012 Report on Inward Investment in Wales, because
we believed there was a strong business case for doing so.
This view was reinforced by the evidence submitted to this inquiry.
13. In July 2012during the course of our
inquirythe DfT confirmed the further electrification of
the GWML to Swansea, in addition to electrification of the Cardiff
Valley Lines. This followed agreement between the DfT and Welsh
Government ministers on the terms under which the UK Government
would fund these enhancements.The electrification of the main
line to Cardiff is expected to be completed by 2017, and to Swansea
14. Carl Sargeant AM, Minister for Local Government
and Communities in the Welsh Government, told us that the electrification
of the South Wales lines was "excellent news",
particularly as two-thirds of the population of Wales lived along
that transport corridor. DfT Minister of State, Simon Burns, told
us that the Government's commitment on electrification would see
Wales's rail network and communications "improved significantly",
with subsequent benefits for communities and businesses in South
15. We welcome the Government's
decision to extend the electrification of the Great Western Main
Line from Cardiff to Swansea, and to electrify the Valley lines
into Cardiff. These are both issues that we have pursued with
vigour in recent years. These improvements will allow passengers
to benefit from shorter journey times and longer and newer trains,
and we believe will increase economic and employment opportunities
16. The co-operation that took place between
the UK and Welsh Governments to secure electrification in South
Wales was highlighted by witnesses as a welcome example of effective
joint working between the two administrations. Mark Barry, a transport
consultant, told us:
The work that was undertaken on the business case
for extending the Great Western line electrification to Swansea
and the Valley lines resulted in much greater interaction between
transport officials in Cardiff and those in the DFT. There is
a richer relationship now than there perhaps was previously.
The Welsh Government Minister was largely positive
about the relationship and working practices between his department
and the Wales Office, particularly around electrification. He
highlighted, however, that it had been difficult to secure agreement
in respect of some aspects of the electrification programme: for
example, he claimed it had been difficult to persuade the former
Secretary of State for Wales and the Welsh Government to publicly
agree on a position on electrification of the Valley Lines. He
recognised that the relationship between the Welsh Government
and Wales Office on transport issues required further work.
17. The collaborative working
between the Wales Office, Department for Transport, Welsh Government,
and other key stakeholders to secure further electrification in
South Wales is hugely welcome. This demonstrates what can be achieved
by all parties working together. We trust that the lessons learned
from this experience can be applied in the future, not only for
other strategic cross-border transport decisions, but more broadly
on issues where interests should be aligned, such as economic
Electrification in North Wales
18. Witnesses identified the electrification
of the North Wales Main Line and other lines in North Wales, including
the 'Borderlands' Wrexham-Bidston route, as the next priority
cross-border rail investment. Many witnesses, including the Rail
Freight Group, Welsh Ports Group and Professor Stuart Cole, supported
calls for electrification in North Wales.
19. The North Wales transport consortium, Taith,
also highlighted that cross-border rail traffic between North
East Wales and North West England was likely to increase following
the creation of Enterprise Zones in Deeside and Anglesey in Wales
and the Mersey Waters Enterprise Zone, which includes the Liverpool
Water and Wirral Waters projects.
20. The Welsh Government Minister agreed that
the electrification of the North Wales Main Line and Wrexham-Bidston
line was the next priority for rail infrastructure in Wales. He
said he had begun discussions with the DfT on this matter.
DfT Minister of State, Simon Burns, noted that the cost of electrification
of the Wrexham-Bidston line was likely to be high, but confirmed
that the Government would consider any business case submitted
on this scheme for the next stage of rail investment from 2019
21. Since then, the Secretary of State for Wales
has held a meeting with stakeholders in Llandudno to discuss electrification
in North Wales, following which he said "The sooner we can
start working up a business case for the next HLOS round the better."
In January, the Welsh Government committed to developing a robust
business case for electrification of the North Wales rail line,
in co-ordination with Taith.
22. Rail connectivity between
North or Mid Wales and England has been overlooked for too long.
Good rail connections between North East Wales and North West
England will be increasingly important in the future following
the creation of the Mersey Waters Enterprise Zone in the North
West of England, and the Deeside and Anglesey Enterprise Zones
23. We urge the Department
for Transport and Wales Office to support the Welsh Government
in developing the business case for electrification of the North
Wales Main Line so that it can considered as part of the next
round of rail investment. We expect the business case to meet
the same high standards as that made for electrification in South
Cross-border services from Mid
24. Much attention is often given to the rail
connections between North and South Wales respectively and England,
but rail options from the more rural areas of Mid Wales across
the border are particularly limited. We experienced this first-hand
during our train visit to Aberystwyth from London: a four and
a half journey requiring a transfer at Birmingham. Currently there
is a service every two hours between Shrewsbury and Aberystwyth
on the 'Cambrian' line. The Welsh Government's National Transport
Plan of 2010 committed to establishing an hourly service by 2011.
This improvement has been delayed and is not now expected to happen
25. Arriva Trains Wales told us that the infrastructure
needed to deliver an hourly service was now in place, but discussions
were required with the Welsh Government about when hourly services
would commence. The
Welsh Government Minister explained that there had been delays
due to problems with the new signalling system in North Wales
and the difficult economic climate.
26. Another possible improvement to services
between Aberystwyth and England would be the re-establishment
of a direct service to London. Arriva Trains Wales told us that
it did not currently have plans to re-launch a campaign for a
direct service because the routes previously identified for such
a service were no longer available. Arriva believed a direct service
was therefore "not a realistic proposition".
27. We are disappointed that
the Welsh Government's commitment to establish an hourly service
between Aberystwyth and Shrewsbury by 2011 will now not be in
place until 2015. We urge the Welsh Government to give serious
consideration to how this much-needed improvement could be brought
Connections to UK airports
28. Almost one in five of the 4.3 million air
passenger journeys starting or ending in Wales each year pass
through Heathrow Airport.
Connections to Heathrow Airport are particularly important to
businesses in Wales because of Heathrow's role as the UK's hub
airport. Mark Barry, a transport consultant, told us:
I talk to businesses. If you are looking at foreign
direct investment in south Wales and ask what their consultants
advise, they say, "We may set up in the UK. How far away
are you from Heathrow and from London?"
] For now, Heathrow access, for the business community,
is still the most important form of access we need.
In July 2012 the DfT announced as part of its aviation
strategy that £500 million would be spent on a new link from
the Great Western Main Line near Slough to Heathrow Airport. This
could provide "significantly improved connections" from
South Wales to Heathrow, with journey time savings of up to 30
minutes. DfT Minister,
Simon Burns, told us that a "considerable amount of work"
had been done on the project but no preferred route had yet been
decided. The earliest date that the new link could be in operation
was between 2020 and 2022.
29. It has been suggested that improved rail
links between South Wales and Heathrow could also create growth
opportunities for Cardiff Airport. A group of transport experts
and entrepreneurs developed a £250m plan to turn Cardiff
Airport into the "Atlantic Terminal" of Heathrow Airport,
with a high speed rail link between the two airports.
When questioned, the Welsh Government Minister appeared supportive
of the proposals: "There is lots of talk about Heathrow and
a new airport [in the South East]. Well, why shouldn't it be Cardiff?"
He said he was keen to support Cardiff Airport in its discussions
with the DfT on this matter. The Welsh Government has since stated
an intention to purchase Cardiff Airport.
30. Witnesses also wanted improved transport
connections to other UK airports. Taith was working with transport
partners in North West England to campaign for a direct rail link
from North Wales to Liverpool John Lennon Airport.
It also wanted more regular train services from North Wales to
Bristol Airport said it was already "well served" by
both rail and road connections from Wales but, given the "increased
importance of Bristol Airport to air travellers to and from Wales",
called for these connections to be maintained and improved.
31. Wales would clearly benefit
from improved connections to those airports serving South and
North Wales, including Cardiff, Liverpool, Manchester, Bristol
and particularly Heathrow. Better connections to these airports
would reinforce Wales' potential to play a full part in the global
economy. We welcome the announcement that a new link will be developed
from the Great Western Main Line to Heathrow Airport, which will
improve connections between South Wales and Heathrow. The development
of faster links to other airports should be encouraged.
High Speed Rail
32. High Speed 2 (HS2) is the proposed high speed
rail line between London, Birmingham, Leeds and Manchester. The
initial phase of HS2, between London and Birmingham, is expected
to begin operation in 2026, costing an estimated £32 billion.
The onward lines to Leeds and Manchester are to be completed by
2033. Plans for a high speed rail network were initially developed
by the previous Government, which published the case for an HS2
line and its preferred route in 2010.
The Coalition Government launched a major public consultation
for HS2 in 2011,
and announced the decision to proceed with Phase 1 of HS2 in January
2012. The Government
has since announced its preferred route for the onward links to
Manchester and Leeds.
This includes a stop at Crewe, which will create opportunities
for connections with services from North Wales.
IMPACT OF HS2 ON WALES
33. The vast majority of witnesses told us that
failure to include a high speed rail line between England and
Wales as part of the HS2 scheme would put South Wales at a disadvantage
compared to other areas of the UK. The South East Wales Economic
Forum argued that HS2 was likely to have a negative economic impact
on South Wales unless the region's own rail networks were significantly
improved. The Chartered
Institute of Logistics and Transport (CILT) Wales Cymru said that
the benefits from HS2 would be limited to the areas served by
the line, and this could be detrimental to the competitiveness
of South Wales in particular.
The Institute of Civil Engineers (ICE), as well as several other
witnesses, stressed the need to improve cross-border rail links
between the Welsh rail network and those areas served by HS2.
34. On the other hand, we were told that North
Wales could benefit from improved connections to London due to
additional capacity on the West Coast Main Line. Taith, the transport
consortium for North Wales, considered HS2 to be a "big ticket
issue" for this reason.
But Taith too stressed the importance of good connections from
North Wales to those areas served by HS2.
35. The Welsh Government has concluded that the
exclusion of Wales from HS2 will put Wales at an economic disadvantage.
It produced two reports which stated that areas not served by
HS2 would be at danger of losing jobs and people, as businesses
relocated along the HS2 line.
The Welsh Government Minister told us that Wales's exclusion from
HS2 would mean more would have to be made of the existing rail
network in Wales: for example, the new Wales and Borders franchise
would need to be connected to areas served by HS2.
When questioned on the impact of HS2 on Wales, DfT Minister, Simon
Burns, said that the DfT had not conducted any assessment of the
impact of HS2 on Wales.
36. We also received contrasting evidence about
whether the Welsh Government had been sufficiently involved in
the decision-making process for HS2. The DfT Minister believed
that the DfT and Welsh Government had had "ample discussions"
when the preferred route for HS2 was announced.
But the Welsh Government Minister said:
[W]e did not have a part in the decision-making process,
but we did present our views at the Cardiff stakeholders' day
from the Welsh Government's position on that.
Other witnesses such as transport consultant Mark
Barry suggested that the Welsh Government had been late to enter
discussions around HS2, and as a result was unable to significantly
inform the debate.
37. The overwhelming view of
the evidence we took is that South Wales will lose out from its
exclusion from the High Speed Two (HS2) proposals. Indeed, there
is a risk that HS2 could have a serious negative impact on the
South Wales economy due to its relative proximity and the potential
for businesses and people to relocate eastwards across the border.
We are therefore concerned that the DfT has not attempted to assess
the economic impact of HS2 on Wales.
38. We recommend that the
UK and Welsh Governments work together to assess the economic
impact of HS2 on Wales as a matter of urgency. Should any adverse
impacts be identified we expect the UK Government to consider
possible mitigation measures.
A HIGH SPEED RAIL NETWORK
39. The Government considers HS2 to be the first
step of a wider high speed rail network in the UK. Our predecessor
Committee concluded in 2009 that Wales would benefit enormously
from a high speed line linking South Wales and London.
However, no such link is being considered as part of the Government's
current proposals for a high speed network.
40. Witnesses told us that Wales would be at
a disadvantage if excluded from a future high speed rail network.
A study commissioned by Greengauge 21 showed that the impact of
excluding Wales from a high speed rail network could result in
21,000 fewer jobs in Wales by 2040, and a reduction in wage growth
of 0.04% per annum.
The ICE Wales Cymru argued that high speed rail links between
all UK capitals should be prioritised, and that the next major
high speed rail project should link Wales to the high speed rail
41. Some witnesses argued that the Great Western
Main Line (GWML) could be upgraded to a high speed line to connect
London and South Wales. Greengauge 21 and the Great Western Partnership
have developed proposals to explain how the GWML could be progressively
upgraded over 25 years so that it formed part of a national high
speed rail network.
42. DfT Minister, Simon Burns, told us that HS2
was seen as a "spine" from which there would be other
He said that "Wales is an obvious place for it [the high
speed rail network] to be extended to, but that is a matter for
the Welsh Government and others to look at in due course."
The Minister was not familiar with the Greengauge 21 proposals
to upgrade the GWML, but undertook to examine their proposals.
43. Wales would benefit from
the development of a high speed rail link to England. This would
be an important boost to the Welsh economy and help to achieve
the aim of successive Governments of rebalancing the UK economy.
It is disappointing that the UK Government and Welsh Government
are not currently developing plans for such a link as part of
a wider high speed rail network. We call upon the UK and
Welsh Governments to begin developing the case for a high speed
line between England and Wales. This should consider whether upgrading
the Great Western Main Line to a high speed line would be the
best way to establish high speed connections between England and
FUNDING IMPLICATIONS OF HS2
44. There have been calls for the Welsh Government
to receive a £1.9 billion "Barnett" consequential
the UK Government's decision to proceed with HS2, as some consider
this to be an "England-only" scheme rather than a UK-wide
project. Several witnesses, such as transport consultant Mark
Barry, argued that the Welsh Government should receive a consequential
payment, which could be used to improve the transport network
in Wales. HM Treasury
has confirmed that the Welsh Government would receive a consequential
payment in relation to spending on Crossrail, another major rail
45. The UK Government's position is that the
HS2 project would not result in a consequential payment for the
Welsh Government because funding for rail infrastructure is not
devolved. This was
challenged by the Welsh Government Minister who told us the matter
was "slightly unclear". He said the Welsh Government
Finance Minister was in discussion with the Treasury on this point.
The Welsh Government subsequently wrote to us on this point and
stated "it would not expect to receive consequentials"
in respect of HS2:
The Welsh Government continues to engage with the
UK Government to ensure that Wales receives all of the consequentials
to which we are entitled. In relation to the recent HS2 announcement,
no budget allocations have been made for the construction of either
phase in the current Spending Review period.
Rail infrastructure is not devolved and as such we
would not expect to receive consequentials. An exception is in
relation to transport projects in London where the Welsh Government
can receive consequentials, an example of this is the Crossrail
project for which a consequential was paid to the Welsh Government.
46. It is not clear why the
Welsh Government should be entitled to a "Barnett" consequential
payment in respect of the Crossrail project but not HS2. We
recommend that the UK Government ensures that all England-only
transport infrastructure projects result in the appropriate Barnett
47. In order for the Welsh
economy not to be left behind by the construction of HS2, the
Government must continue to invest in the improvement of cross-border
roads and rail services between England and Wales.
Cross-border rail franchises
48. The DfT specifies
and funds three of the four rail franchises which provide cross-border
rail services between England and Wales, with the Welsh Government
being largely responsible for the fourth, the Wales and Borders
Franchise. The Wales and Borders franchise provides cross-border
rail services to Manchester, Shrewsbury, Birmingham and Crewe,
in addition to all rail services wholly within Wales. The contract
for the Wales and Borders franchise was awarded to Arriva Trains
Wales by the DfT in 2003. The Welsh Government subsequently took
responsibility for this franchise in 2006. The franchise ends
in 2018 and the Welsh Government is currently pursuing discussions
in relation to the new franchise.
49. A major issue with the current Wales and
Borders franchise is that it was let on a "no-growth"
basis, meaning that there is no provision in the franchise for
the operator to increase capacity for services in response to
rising demand. We were told that passenger numbers had increased
on cross-border services by 8-13% a year since 2003,
almost twice that of numbers on Wales-only services. Yet, under
the terms of the franchise, if the Welsh Government wished to
increase capacity significantly on overcrowded services, it would
need to fund these changes itself. Arriva Trains Wales told us
it had identified and implemented some marginal increases in capacity
on its cross-border services, such as changing timetables and
But train operators and local transport consortia representatives
agreed that the future franchises would need to include some mechanism
to allow for passenger growth. 
50. Carl Sargeant AM, the Welsh Government Minister,
raised concerns that the DfT had the power to interfere with the
Welsh Government's preferences for the specification of the new
Wales and Borders franchise. Although the DfT's evidence states
that the Welsh Government is responsible for specifying and funding
this franchise, Carl
Sargeant AM told us it was for "the Secretary of State for
Transport to make the ultimate decision [on the franchise] with
consultation and agreement with a Welsh Government Minister."
He was also keen for the new franchise to connect cross-border
rail routes with areas served by HS2.
51. The Wales and Borders franchise
is due for renewal in 2018 and it is important that the Welsh
Government can develop a suitable franchise package that provides
the best type of service for Wales. Given the importance
of the Wales and Borders franchise to cross-border links between
England and Wales, we urge the UK and Welsh Governments to work
together on developing the new franchise ahead of 2018. Key considerations
should include ensuring the new franchise enables the further
growth of cross-border rail travel, and also provides for adequate
connections to areas served by HS2.
52. There may be scope to increase
the frequency of some other cross-border rails services, such
as the London Paddington to Swansea service. We recommend
that the UK Government and Welsh Government work with train operators
to identify cases where the frequency of cross-border rail services
could be increased, without the need for additional public subsidy.
8 Q100 Back
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Office, 16 July 2012 Back
Cross-border provision of public services for Wales: Transport,
HC 58 Back
'Intercity Express and rail electrification', DfT, 1 March 2011 Back
Inward Investment in Wales, HC 854-i Back
Qq 38, 52, 99 Back
Qq 203-4 Back
Ev 57, Ev 64, Ev w22 Back
Ev 60 Back
''Sooner the better' for north rail electrification case', BBC
News, 23 November 2012 Back
'Step closer towards electrification of North Wales rail line',
Welsh Government, 9 January 2013 Back
Bristol Airport estimate derived from CAA Passenger Survey data
(cited in their evidence to the Commission on Devolution of Wales,
May 2012). Back
Para 2.84, Draft Aviation Policy Framework, Department
for Transport, July 2012 Back
'Cardiff Airport: Western Gateway plan for Heathrow hub', BBC
News, 31 October 2012 Back
'Welsh Government to consider purchase of Cardiff Airport', Welsh
Government, 18 December 2012 Back
Ev 60 Back
Ev 39 Back
High Speed Rail, Department for Transport, March 2010 (CM
High Speed Rail: Investing in Britain's Future, Consultation,
DfT and HS2 Ltd., February 2011 Back
'High speed rail', Written Ministerial Statement by Rt Hon Justine
Greening MP, 10 January 2012 Back
'High Speed rail', Written Ministerial Statement by Rt Hon Patrick
McLoughlin MP, 28 January 2013 Back
Ev 47 Back
Ev w5 Back
Ev 48 Back
Regional and Local Economic Impacts of Rail Investments,
Welsh Government, January 2012 Back
Qq 215-6 Back
Cross-border provision of public services for Wales: Transport,
HC 58 Back
'Consequences for employment and economic growth', Greengauge
21, February 2010 Back
Ev w3 Back
The Great Western Partnership is an action group representing
major businesses and public authorities in the South West of England
and South Wales, and was formed in response to the High Speed
Rail agenda in the UK. Back
'Great Western Conditional Output Statement', Great Western Partnership,
March 2012 Back
The Barnett formula is the mechanism used by HM Treasury to adjust
the public expenditure allocated to the devolved administrations.
A Barnett consequential is a payment in relation to a change in
spending levels by the UK Government. Back
Funding the Scottish Parliament, National Assembly for Wales and
Northern Ireland Assembly, HM Treasury, October 2010 Back
Q52, Responsibilities of the Secretary of State for Wales,
HC 816-i, 11 December 2012 Back
Ev 87 Back
The Government outlines the services a franchisee will have to
operate under a rail franchise by specifying the required services
in the franchise agreement. Back
Q65. The 8-13% refers to typical annual growth for certain key
cross border service groups. The exact average annual growth figure
on all cross border services since the start of the franchise
is 12.18%. The equivalent figure for Wales-only services is 6.87%
average annual growth. Back
Qq 64, 70 Back
Qq 27, 90 Back
Ev 69 Back