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It is possible to recreate a functioning railway – here's how
Sir Peter Parker produced a string of aphorisms during his time as British Rail Chairman. One is more apposite now than he could ever have imagined – ‘railways tend to fall flat on their interfaces'.
Privatisation created a plethora of interfaces and sought to control them with contracts. SRA Chairman Richard Bowker and Regulator Tom Winsor still think that better, simpler contracts will make a dysfunctional fragmented railway work.
But they are fast becoming yesterday's men, privatisation warriors who can't see how these newfangled streamlined monoplanes could keep their wings on without struts and bracing. Old-school railwaymen of my acquaintance have already left them behind.
When Richard Bowker called Network Rail's decision to take maintenance in house ‘the last piece in the jigsaw', I reckoned he was mixing metaphors. Now I am sure that it was the first domino to fall.
Network Rail having decided to integrate infrastructure and its maintenance, the next step towards a proper railway is to bring both sides of the wheel/rail interface under common management. This can be done within the present private ownership.
But first, why should we do it? Answer, to provide the customer with a boringly reliable railway.
Who is responsible for making the railway boringly reliable? Well, first the engineers of all disciplines who ensure that things go ftang as rarely as possible, then the operators who exploit the resulting lack of nasty surprises. Until you get the engineering and operating right all the customer service is only elastoplast.
Hence the need for vertical integration with all disciplines contributing to a common bottom line. In other words, back to Sir Bob Reid's business led railway.
How do we get there? Answer, surprisingly easily, given the will.
First you set up a joint venture company. Lets call it South East Rail (SER)
This company would lease the Kent infrastructure assets from Network Rail and be responsible for their maintenance. It would also take over responsibility for the franchised operation of train services.
Thus SER is a proper vertically integrated railway. Reporting to the Managing Director would be a board with Directors responsible for Infrastructure, Operations, Fleet, Commercial, Finance and Human Remains. But who owns the company?
Well SER is a 50/50 joint venture between Network Rail and the SRA's virtual franchisee, South Eastern Trains (Holdings) Ltd, It receives the SET subsidy plus a pro-rata share of Network Rail's direct grant from SRA.
This ought to be more money than it needs because the internal contractual friction, or treacle, as I call it, will be greatly reduced. How much would be saved through vertically integration would emerge as SET gained control and understanding of the business and its assets.
For example delay minutes would become a management tool again rather than a money go round. Most of the Schedule 8 malarkey would disappear.
Bridging the wheel/rail and pick-up shoe/contact rail interfaces will allow the railway to be engineered as a system once again. And there is an awful lot of synergy to be gained in this way.
Of course, virtual boards and Railtrack's alliances were supposed to replicate vertical integration, but they are essentially feel-good meetings of minds, with little true commercial discipline. While some infrastructure alliances have worked, there is a concern that sharing the pain and gain in a no blame situation lacks the bite of an infrastructure director cracking the whip. Hence the move to bring services back in house.
There are also the joint controls, pioneered by Network Rail's Southern Region with SWT in Wessex and being rolled out across the network. These works because the controller has been given authority and can make decisions on train services and regulation. For example, after the crane incident at Clapham Junction, the Network Rail controller determined the emergency timetable.
However, this too lacks the rigour of a proper command and control structure which vertical integration restores. And the Schedule 8 payments are still there, bit both parties agree to accept the financial outcomes of the controllers decisions – well that's the idea.
Integrationalism – as the new movement is called, is sure to generate complaints from the freight companies and open access operators. But I don't see a major problem.
They would retain their track access contracts, with Schedule 8 compensation. And Tom Winsor 's Gloster Gladiator, in the form of Model Contracts should provide the necessary protection.
There are also concerns as to who takes risk, especially catastrophic risk. This I think is over-rated – although the bus bandits (Stagecoach excepted who are really up for it on SWT) seem to be happy to run franchises to SRA specification to existing rules and are not noted as transport visionaries. However, the railwaymen and women who actually run the railway are natural born integrationalists.
Another criticism is how you would apply the concept to the East and West Coast main lines. The answer is ‘dunno'. But these routes are the exception and should not block progress on the rest of the railway.
And then there is European regulations. Where there was this interesting straw in the wind in the House of Lords.
Lord Stoddart of Swindon asked whether European legislation requires separation of ownership of rail track and related fixed installations from ownership and operation of rolling stock used for movement of goods or passengers
Lord Davies of Oldham replied: ‘No such separation is required. What is required is accounting separation and that the body responsible for allocating infrastructure capacity is separate in legal form, organisation or decision making from bodies or firms that provide rail transport services. Where such separation does not exist, a separate allocation body must be established.
And, of course, the allocation of capacity referred to is one of the roles of what we shall soon have to call the Office of Rail Regulation. So, as Informed Sources fourth law states, ‘European legislation only stops Governments doing what they don't want to do in the first place'.
An argument put forward by the Transport Secretary is that Integrationalism would ‘Balkanise the railways'. Well I for one would rather have several proper railways costing less and performing better, but the long term aim is obviously to produce bigger groupings.
And one could see an English Railway covering the PTE areas from Birmingham to Newcastle, and a London Railway – Let's call it Network SouthEast and is unavoidable it Thameslink and CrossRail are ever to make sense.
But the important thing is to actually start a pilot scheme. SET is one obvious place to start since there is not timorous franchisee to get in the way. Or there is SWT.
Stagecoach is a leading integrationalist and when the SWT franchise was being renegotiated, and Railtrack was in administration, the company produced a discussion paper called ‘A platform for change – The potential for vertical integration on Britain 's railways'. This proposal assumed that SWT would take over responsibility for maintenance and operation rather than a joint venture with the infrastructure owner but the principle remains the same. You can find it on-line at www.Stagecoachgroup,com. Go to ‘Media Information' and you will find it under ‘Publications'.
But giving the Tritton Lecture to the Railway Division of the Institution of Mechanical Engineers on 2 February this year, Stagecoach Director Graham Eccles revealed that the proposal had been put to the SRA which had promised an independent evaluation of this paper, to be led by a former BR Director turned consultant. But nothing has happened so far.
It would be odd if the SRA which preaches the need for change were to be a closet reactionary.
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