Rail 500: Why London deserves the lion’s share of rail capital

Interesting things are afoot in the rail industry – both in terms of new projects and of experiments in new structures for responsibility for franchises – and it is London that has become the focus. Now before people bemoan such attention being lavished on the capital city, it has come about through a fortuitous combination: Transport for London has been given the power to borrow lots of money and the government is keen to see services in the capital improve, without having to foot the whole bill itself…

Three years ago, TfL appointed Ian Brown, a longstanding railwayman who had previously run the Docklands Light Railway, as its managing director, rail services. It seemed a bit of a non-job since TfL does not have any rail services under its direct control, apart from the Underground, which at the time was being run by the government. However, it has proved a canny appointment because Brown has managed, through careful lobbying and by making good use of the mood of devolution, to create a situation where suddenly his job is replete with opportunity.

Take the capital projects. Ken Livingstone, the Mayor, recently announced a £10 billion programme of transport investment in London. Although the bulk of the rail money will go on the Tube, as part of the Public Private Partnership, the go-ahead has also been given for the East London Line extension and two new extensions on the Docklands Light Railway which effectively create a new line from Stratford International to Woolwich Arsenal.

Moreover, there are high hopes that Crossrail will finally be given the green light, following the appointment of former Treasury official and Network Rail Deputy Chairman Adrian Montague as chairman of the project. Add in the promised new trains for the services from Kent along the Channel Tunnel high-speed line, along with the reinstated northern ticket hall for King’s Cross (a mere £300m-worth, courtesy of HMG!) and London appears, indeed, to be doing jolly well, especially when compared with other parts of the country where tram schemes have been cut. Londoners, therefore, should be looking forward to some decent transport improvements in the not-too-distant future. Much of the rationale behind what is happening in London is couched in terms of helping the Olympic bid, even though the UK capital is an outsider in the betting on who will be allowed to stage the event. However, TfL is trying to make sure that all this work is well under way by the time the Olympic selection is made next summer so that the government can’t jettison schemes if the bid fails.

The one crazy gap in this investment programme is Thameslink 2000 (or 2050 as it should probably now be known, just to be sure). What makes that all the more ridiculous is that the box under King’s Cross is not being fitted out as a station, which would cost just £70m, a quarter of the price for the ticket hall. It seems ludicrous that the government will not fund this. Especially when you consider the thousands of extra people brought in by Kent and Eurostar trains on the Channel Tunnel Rail Link who will have to put up with the tiny current King’s Cross Thameslink station in Pentonville. Its platforms are so narrow that they pose a safety hazard at busy times even now, while the trains will speed through the empty box just a few hundred yards down the track. This is short term-ism at its best from the Treasury.

Interestingly, the standard model for this investment is no longer complicated PFI schemes, which have been the undoing of many tram proposals, as more simple procurement deals seem to be back in favour.

On the franchising side, too, London is getting special treatment. The new directions and guidance issued by the SRA effectively hand over to TfL the right to specify service levels on a little network of services run by Silverlink: the North and West London lines, Barking to Gospel Oak and London to Watford Junction stopping services. TfL has not become the franchise authority for these lines but it has a right to increase services on them by paying extra cash or, conversely, cutting them back and pocketing the money.

And Ian Brown reckons that both cuts and increases may prove desirable. For example, the London to Watford Junction stopping service duplicates part of the Bakerloo Line and, indeed, Underground trains used to run all the way there. So one suggestion could be cutting back the Euston trains and replacing them with Bakerloo services, saving a vast amount of subsidy which could be channelled into improving the North London Line, where usage has been soaring.

The economics of the railway and the structure of finances, however, make it difficult to separate out precisely the costs that would be saved by cutting services. That is why another new task for the SRA is to “collect data on revenue, costs and performance for London commuter train operating companies separately for inner-suburban services.” This suggests that if TfL’s new role on the Silverlink network proves effective, the government may give the organisation similar power over lots of other services, which will make it much easier to integrate London’s rail services in an unprecedented way.

However there is a further complexity. TfL currently pays about £10m to buy some extra train services in its area – money that it reckons is well spent as it caters for the ever-growing demand on some routes. However, TfL gets nothing back from that. It is, in effect, handing over money to the train operators who then pocket the extra revenue they receive from the extra passengers.

The sensible option would be for TfL to take the revenue risk, and merely use franchisees as contractors, in the same way that Virgin and several other franchisees are functioning at the moment. However, ATOC has set its face against that, not least because it is the one way that its members can make big profits, sometimes quite unmerited because they simply reflect increased economic growth that invariably leads to passenger growth. There is, too, the problem of incentivising the companies to collect revenue, but that is not insuperable. After all, London Buses currently operate on that kind of basis.

So exciting times are ahead in London, but is it unfair that the capital is getting all this dosh and special treatment? Announcing a (sort of) approval of Crossrail on the same day as the Manchester extension and other tram schemes were scrapped was not Alistair Darling’s canniest political move (although I do suspect Manchester will get a reprieve – not least given the strength of the backlash and the political support the scheme has in a Labour heartland area). Yet the focus is right. London is a huge rail market, with two-thirds of rail journeys originating or ending in the capital, and rail is at its best when serving busy transport corridors, with which the capital is replete.

In a sane world, where the true need, value and benefits of a modern transport network were realised, there would, of course, be plenty of money for both London and the regions. But until that world materialises, which hardly looks likely under either Darling’s or Labour’s watch, it is right that the capital is getting a lion’s share of what is available. Roll on the brave new world for transport in the capital – all this optimism, two columns in a row, is clearly going to my head. ‘Woe-mar’ will be back, dinna worry!

First reverses on cycle stands

The power of the press is obviously still strong. This column mentioned a few weeks ago that First Great Western had gone to the trouble of installing cycle parking at Didcot station where there is a heavy demand for it. Unfortunately, they were the wrong sort of stands, those ghastly butterfly-type holders which not only buckle the front wheel, but ensure the rest of the bike is easy to steal.

Cyclists in the area had raised the issue, and this was particularly important since it seemed First was going to install other, similar stands elsewhere. Although the company spokesman argued that it was now impossible to reverse the decision, that is precisely what has happened. There are now shiny new ‘Sheffield’ stands at the station which are the conventional metal tubes that are the simplest and best available. So congratulations to First for listening to cyclists and being ready to change its policy when the error of its ways was pointed out.

While on the subject of cycles and trains – and I promise not to mention it again before Christmas – congratulations to the SRA for reviving the cycle awards for the industry, now called Connections. At the recent awards ceremony, the recipients, who included Edinburgh Waverley station, four helpful train staff from Arriva and First North Western and GNER, were all delighted at receiving awards. However, with the SRA being consigned to history, who will take over this important little niche bit of encouragement for the industry? It is the sort of thing that could easily just fall by the wayside in the new structure, although, encouragingly, ATOC may be prepared to take up the mantle.

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