Return to Archive -by date - by topic - 2007.
To us, Sir Robert Reid was Britain 's greatest railwayman, not just of his generation but when judged over the second half of the 20 th Century. First as Chief Executive and then as Chairman he created a new model for the state railway, with managers engineers and operators accountable for the bottom line of clearly identified businesses.
With a cadre of home=grown managers coming of age he was able to implement his vision of the business led railway in under a decade. During this time, efficiency and performance improved, subsidy fell and investment, when measured in track and catenary, interlocking and bogie, as opposed to boiling frog debased pounds, reached levels not seen since. Today we are trading off the capital of Bob Reid's legacy.
It is appropriate, then, that his achievements should be commemorated in a memorial lecture under the aegis of the Chartered Institute of Logistics & Transport. In the past we have had occasion to cavil at the choice of speaker, when the great man's memory has been traduced to suit the ephemeral political issues of the day. But there could not have been a better choice than Guillaume Pepy, Chief Executive of French Railways and Chairman of Eurostar, to present the 2007 lecture.
In the year that St Pancras International will be linked to the fast growing European high speed rail network, M. Pepy gave a magisterial over-view of the expanding role of high speed rail as the steel wheel on steel rail reinvents itself yet again to exploit its advantages. His paper ranged over technology, pricing policies, competition and procurement. It was a tour de force.
But, afterwards, we soon came down to earth when we pondered who could speak from the British perspective were the honour were to be returned at a lecture in Paris commemorating some giant of SNCF. The sad answer is that no one today has the authority to speak for our railways.
Nor have we much to speak about, with one exception. M. Pepy paid tribute to the methodology of the Office of Rail Regulation (ORR) in balancing economic, technical and safety regulation. This could provide ‘a useful template' for open access competition on the European high speed network. So, having given the railway to the world, two centuries on we are now the masters of regulatory documentation.
And, indeed, the contrast between M. Pepy's vision and events in Britain is depressing. By 2020, the pan-European network should have doubled to over 4,000 km of high speed lines, ‘making the train a credible alternative to short haul flights'. In anticipation of the potential market M. Pepy points to operators already placing orders for the new generation of 350km/h trains.
Meanwhile, as you can read in Informed Sources, buying just 106 vehicles to lengthen the Virgin West Coast Pendolino fleet is, seemingly, beyond the capabilities of our fragmented railway. Virgin know what they need, and have a business case. Alstom had shortened the delivery lead time and begun spending on the basis of a handshake deal.
But, DfT Rail did not appreciate the realities of manufacturing and maintenance time cycles, and behaved as if there were no real urgency. Equally for Angel Train's owner, the Royal Bank of Scotland to decide only on 1 February that a possible Competition Commission Investigation it had known about since 29 November last year suddenly made it too risky to invest £180 million was equally unprofessional.
So, the Pendolino lengthening project ran out of both time and money. But as we go to press, it looks as though both obstacles to progress have realised the reputational risk of what can only be called their institutionalised myopia and are now engaged on a process of belated damage limitation.
Pendolino lengthening appears to be in suspended animation, rather than dead. All now depends on a face saving compromise between DfT Rail and Angel Trains.
Unless the response to consultation to ORR's draft conclusions reverses the original decision, the Competition Commission market investigation will go ahead – with unforeseen results. But RBS concern over short term risk to Pendolino rentals could surely be assuaged by DfT Rail cutting a healthy chunk of residual risk value from the Pendolino fleet.
It is an unenviable range of options facing DfT Rail. The Department can sit tight and run nine car Pendolinos through to 2012. Or it can revive the project with alternative funding for the extra cars. But to get a reasonable rental, it will have to be assumed that the cars, and the fleet into which they will be inserted, will run on through the successor franchise. This would, in effect, reward Angel for its parent's commercial timidity.
Or it can come to an accommodation with Angel, based on a Section 54 requirement that the replacement ICWC franchise will be required to operate the Pendolinos through to 2022 – assuming that 10 year franchise terms are still the norm. Face would be saved all round.
DfT Rail could argue that it was not going soft on the ROSCOs and had got a better leasing deal on the Pendolino fleet. RBS could argue that it had mitigated the risk of the Investigation by ensuring another 10 years cash flow from an expensive asset.
And the rest of us could draw some solace from the fact that by the end of this year, at least we will be connected to the real world, where buying 106 trains is a far easier task than lengthening 53 Pendolinos. The wreckage of Bob Reid's proud, confident and competent railway is all about us.