Rail 797: Shaw goes for devolution, not revolution

When I previewed the Shaw report back in December (Rail 788), I praised its author, Nicola Shaw, as an extremely bright woman with wide experience of the industry. It is precisely because of those qualities that she has not fallen into the trap of making a series of radical recommendations that would lead to further upheaval in the industry.

However, in avoiding the search for a holy grail, she may have erred just a bit too far in the other direction and ended up with a report that merely states the bleeding obvious.

It is interesting that the Shaw report attracted more than 10,000 response to consultation. And this seems somewhat to have paralysed her. My view is that consultation is often overdone. If someone as knowledgeable and informed as Shaw was appointed, why bother to ask every Tom, Dick and Harry and riders of Clapham omnibuses for their happenworth?

Shaw found that the respondents to the consultation were particularly concerned about three possible developments. They did not want either the privatisation of Network Rail nor its radical break up which would ‘further complicate an already fragmented industry’, and thirdly there was the hardly unexpected agreement that the current high levels of investment in the railways are maintained.

So it was the consultation process that seemed to have knocked on the head the various ideas about extensive privatisation of Network Rail or its break up and Shaw pursued neither. Instead, she has provided seven key recommendations do not exactly set the world alight. I will not go through each one as these are set out in the news pages, but will focus on three of them. The first which seems to set the tone for the whole report, is a real chunk of motherhood and apple pie, saying that the needs of the customers, the passengers and the freight shippers, should be at the heart of rail infrastructure management. Well, it is surprising that in the 20 years since privatisation, that has not been the ethos of Railtrack or Network Rail all the way through.

Shaw tries to entrench this not so radical thinking into the relationship between Network Rail and its customers through a system of ‘scorecards’ which in fact have already been introduced recently by the infrastructure company. Shaw suggests their use should be extended ‘to report on performance against key areas of focus and specific actions at route level’. Well, yes, but surely all this is about communication and the simple process of people talking to each other. The bureaucracy of scorecards or whatever does not replace the basic idea that Network Rail should be an integral part of the rail industry, in constant conversation with its clients who are the train and freight operators. As she then admits, it is all a bit more complicated than that since there are other stakeholders involved, such as the Department for Transport or local authorities. It just seems amazing that we need an expensively produced report, stimulated by a crisis, to put over such an obvious requirement on Network Rail.

The second recommendation is for more devolution. Railtrack/Network Rail has almost matched the NHS in terms of reorganisations and restructuring in its short history already and yet, according to insiders in the industry, none has had a particular satisfactory outcome. Shaw has followed the zeitgeist with a desire for far more devolution and real power at the local level. Shaw wants to see a more ‘flexible and agile’ Network Rail, able to respond to customer needs. Again, all well and good but as she recognises ‘There is of course an inherent tension between devolving powers to the routes in a meaningful way, and retaining a network wide perspective across a national system’. It is precisely that conundrum which has led to the endless series of reorganisations. I remember speaking to one senior manager in Network Rail after the last lot of ‘devolving power’ who said, in effect, ‘you can’t let the bastards at the route level make the decisions’.

Indeed, as giving too much power away to the routes will create the sort of situation that existed under British Rail, which, remember, was hamstrung for much – indeed quite possibly all – of its existence by the different traditions and working practices of the Big Four which ran the railways between the wars. In fact, some of those habits stretched back to the pre-rationalisation days of the Edwardian era. Network Rail is bound by a series of national criteria and universal safety standards. Its big purchasing power can ensure that prices are kept down. It is subject to various national imperatives which can be dictated by the funding available. Therefore, devolution, while a concept that is currently as trendy as supporting Leicester City in political circles, is by no means a panacea. Indeed, it could create more trouble than it is worth. Think of how often trains cross boundaries between routes and, also, simply of how small routes are in relation to the whole of Network Rail. Is it really right that they go off and do their own thing? A bit of autonomy is fine, but Network Rail needs to have a central hard core, as its boss in the post Railtrack era, Iain Coucher, realised.

Clearly the most difficult part of the report for Shaw was the discussion about the role of government. I love her delicate phrasing: ‘since privatisation the government’s involvement in the railway has been constantly changing and adjusting to events, without, so far, ever quite settling into a happy equilibrium.’ Mmm, aren’t you holding back a bit Nicola? While setting out the issues surrounding the role of government, and seeking clarity from the Department about its long term vision and strategy for the railways, Shaw, a former senior manager of the Strategic Rail Authority, falls short of suggesting the obvious solution which is to recreate a version of that organisation. Expecting ministers and civil servants, who are often in their job for no longer than their political bosses, to set out a long term vision is fanciful. Re-creating a body with the specific task of giving the railway a long term focus is inarguable.

Perhaps all this is a bit unfair, as the rather mild recommendations of the report could lead to some significant improvements, a process of nudge rather than shove. However, one could view it as another lost opportunity of focussing on the core malaise in the industry, the fragmentation and the key separation between infrastructure and operations that has been at the root of virtually all the crises since privatisation. Shaw never got near the key question of ‘what franchising is for?’ because that was not in her remit. We will have to await the next crisis, perhaps, before that question is addressed. And here’s a Mystic Wolmar prediction: I suspect that the paucity of bidders for the South Western franchise is a sign of things to come given the cost and complexity of bidding. That’s my bet for the next crisis and ensuing report.


PS memo to Nicola: A quick correction for your report which says that ‘in September 2015, the Office of National Statistics reclassified Network Rail to the public sector’. Not so, it was September 2014, unless you know  something we don’t?


Arriva Trains Wales…and England?


Devolution, as mentioned in the main article, is a tricky subject, and while it is now seen as generally being ‘a good thing’, in practice it can create real difficulties that are best sorted out at a higher level. I spent a weekend in Church Stretton recently, after giving a talk with Nigel at Hawarden, and so travelled on several trains run by Arriva Trains Wales. It is a particularly unpopular train operator, partly because it has a difficult network to run, but also because it has done little to help its cause. I have, over the years, heard many complaints about how unresponsive it is to passengers’ grievances and comments.

In Church Stretton, for example, local people were angry that a few years ago some of the trains on their line in the middle of the day no longer stopped at their station. This turned an hourly service into a two hourly one, and meant that local students who travelled to sixth form colleges in neighbouring towns often had to curtail their last lesson to avoid a two hour wait. All this seemed to be for the train operator just to save a few pounds it paid to Network Rail and showed that the company did not understand its role as a vital part of the local transport infrastructure.

Now local people who live in England but are served by Arriva Trains Wales are even more concerned that there is a desire by the Welsh Assembly to assume much more control over the franchise. Since Arriva Train Wales actually operates for sizeable parts of some routes in England, this, they felt, would disenfranchise them and result in changes that neglected their needs, an argument, incidentally, that stopped Kent suburban services being handed over to Transport for London during Boris Johnson’s first term as mayor. The obvious solution is to have some English representation on whatever body becomes the franchising authority, but once again this highlights the fact that devolution is not universally welcomed.