What’s happened
Eighteen months later than scheduled, the government’s White Paper on the future of the rail industry has arrived. Following a review by Keith Williams, a former boss of British Airways, and transport secretary Grant Shapps, the government has announced a significant revamp. The extent of the change should not be overstated: Britain’s rail industry will remain a semi-privatised hybrid system of state-owned infrastructure and privately run trains. But in a recognition that the current model has generated years of “fragmentation, confusion and overcomplication”, the government is scrapping the franchise system and creating a single public body, Great British Railways (GBR) – a “guiding mind” that will manage all parts of the industry for the first time since the abolition of British Rail in the mid-1990s.
What will GBR do?
Like Network Rail, the public body that Great British Railways will replace and absorb, GBR will own the network and manage the 20,000 miles of track. Unlike Network Rail, it will also set fares and timetables and act as a central point for ticketing. And instead of a franchise system – in which train-operating companies bid to run services and then have considerable commercial freedom to set fares – GBR will award licences on a concession system, meaning train operators will be given contracts to run individual lines for a fixed fee. They will be contracted solely to operate a defined service to certain standards of safety, security and cleanliness – with some greater commercial flexibility on marketing and ticket prices on inter-city routes, where trains have to compete with airlines.
Is this a step towards re-nationalisation?
No, but it is a recognition that John Major’s overly complex privatisation model has failed, and that what Shapps calls “a quarter century of fragmentation on the railways” needs to end. Passenger numbers have more than doubled since privatisation (albeit most of the increase is…