UK: Rail Partners has been officially launched, after being spun out of the Rail Delivery Group to act as a trade body to provide advocacy and policy development services for passenger train operator owning groups and freight operators.
It will also provide operations and engineering technical services for all train operating companies, including those belonging to public sector entities.
There will be ring-fencing to ensure that Rail Partners’ advocacy activities are funded only by its owning groups and freight operator members, and not by the passenger TOCs which receive public funding through their operating contracts.
Rail Partners is headed by Chief Executive Andy Bagnall, who was formerly Director General of the Rail Delivery Group. RDG has played a dual role as both a sector representative and the provider of critical industry-wide services such as ticketing, reservations and rail cards, but many of these activities are to be transferred to Great British Railways as part of the Williams-Shapps reforms.
Speaking at the official launch on July 19, Bagnall said the creation of Rail Partners was a consequence of the government’s rail white paper, which said that operators could form a new trade association to give them a voice during the reform process and beyond. Rail Partners aimed to ‘co-create with government a reinvigorated public-private partnership for the railway’, he explained.
‘I know this is not always a popular viewpoint, but on any objective measure, train companies delivered for passengers, taxpayers and freight customers through the franchising era’, he added. ‘As the government moves to begin rebalancing the public and private sectors, we think it is very important that the best of the private sector’s contribution over the period of franchising is retained.’
Rail Partners exists ‘to make the railway better by harnessing the expertise and the commercial drive of private sector operators for the benefit of those who use the railway, passengers and freight customers, and of course those who pay for it, taxpayers.’
Membership
Membership of Rail Partners is open to freight operators and any organisation which has a UK franchising ‘passport’ (or any future equivalent) enabling it to bid for passenger operating contracts, including companies such as Abellio, Arriva, MTR Corp and Trenitalia which are owned by overseas state-owned entities.
Rail Partners confirmed to Rail Business UK that its membership would not include public sector operators of last resort, as they do not bid for operating contracts.
All of the current owing groups active in the British rail market have already joined, along with the five biggest freight operators which represent 90% of their market.
Five challenges
In conjunction with its launch, Rail Partners published Working Together for a Better Railway, a prospectus which sets out its five priority areas for reform to enhance the passenger experience and reduce the need for taxpayer support.
‘We need a renewed, improved and reinvigorated public private partnership’, suggested Bagnall, ‘where operators are empowered to do what they do best, not only in the interests of the industry and its people, but to the benefit of the nation as a whole.’
1. Great British Railways must be a guiding mind not a controlling mind
Rail Partners says Great British Railways needs to be a ‘strong, independent public sector body at the centre of a reformed system’, with ‘the necessary freedom from government’, and a commercial culture giving operators ‘freedom to do what they can do best’, rather than an ‘bureaucratic, inward-looking system’.
2. New rail contracts are key to an effective public-private partnership
Rail Partners says ‘franchising was a successful system on any objective measure’, and while ‘there is no doubt that it had run its course and change was essential’, the new Passenger Service Contracts must harness the private sector’s ‘creativity and entrepreneurialism’ to grow ridership and revenue, reduce waste, make best use of existing assets and drive modal shift.
3. Transforming the customer experience
Rail Partners wants to see ticketing reform and a ‘retail revolution’, with ‘a much more transparent system’ and modern products to grow new markets. It says this should include single leg pricing, and must account for the growing number of customers who have accessibility needs.
4. Ambitious target to treble freight volumes by 2050
Noting that rail freight contributes £2·45bn to the UK every year, Rail Partners says the economic and environmental rationale for allowing rail freight to flourish is ‘well-established’.
It would like to see small but strategic infill electrification projects, with Bagnall confirming that ‘we have got a list of about 10 schemes which are relatively low cost but will have a disproportionate benefit’.
5. Decarbonising the railway
Attracting people to rail directly reduces transport carbon emissions, but Rail Partners says there is a need to go further and commit to a long term strategy to further decarbonise the railway.
A fork in the tracks
Looking to future policy, Bagnall said the UK rail sector was ‘at a fork in the tracks’. The new Prime Minister, Chancellor and Transport Secretary will have to make ‘some really quite big decisions’ about how to implement reform.
He believed that GBR must be free to take operational decisions without political interference, and needed to encourage collaboration as an intelligent client rather than create a ‘command and control mentality’.
Rail Partners envisages three types of passenger train operating contract: tightly specified concessions for urban lines, hybrid contracts for operators with a mix of local regional and long-distance services; and long-distance contracts offering operators more commercial freedom to compete with other modes.
It wants to see ‘healthy competition’ for contracts, which should offer a ‘proportionate’ balance of risk and reward and a less complex tendering process in order to reverse the decline in the number of companies bidding for each contract.
‘If we get this wrong, if we build an over centralised command and control railway, operators will be overly constrained and not able to respond to customers’, Bagnall explained. ‘There will be limited incentives to innovate, and we will see a railway with lower passenger numbers and revenues, leading to managed decline and service reductions.
‘If we take the right track, harnessing train companies to respond to customer needs and encouraging modal shift, we will instead see a railway with recovering patronage and stabilising finances and platform for wider economic growth and meeting environmental targets.’
