Commons Gate

Passenger Rail Franchising (HC 1354-i)

Transport Committee 5 Jul 2006

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Evidence given by Mr Chris Austin, Director of Public Policy, Association of Train Operating Companies (ATOC), Mr Paul Furze-Waddock, Commercial Director, First Group, Mr Jonathan Metcalf, Chief Operating Officer, GNER, Mr Tom Smith, Planning Director, Go-Ahead Group, Govia, Mr David Franks, Chief Executive, Train Division, National Express Group, and Mr Adrian Lyons, Director General, Railway Forum, Mr David Blainey, Chair, Rail Sub-Committee, Mr Kevin Williams, former Chair, Association of Transport Co-ordinating Officers; Mr Colin Foxall, Chairman, Mr Michael Hewitson, Senior Policy Officer, Passenger Focus; Mr Peter Cousins, Member of Passenger Committee, and Mr Richard Pout, Secretary, Railfuture.

Q19 Mr. Eric Martlew: I can see why you gentlemen would want longer franchises because they are better and give you more security. It does not seem in the interests of the passenger. The reality is you have all had the shock of losing a franchise. The longer the franchise is the more comfortable the companies will be. To disagree with Mr Lyons, a short franchise means that you have to train your staff up to a peak very quickly. Is there not the view that if you get a longer franchise at the beginning of it, at the very least, you can be complacent? Is it not against the passengers' interests to have long franchises?

Mr Metcalf: I really do not believe so. If we take the training with Virgin as an example, those things take about two to three years for all the design, the rolling stock and specification changes and approvals and then taking the trains out of work to have them rebuilt. The purpose of doing that is to give the passengers a better train. Hopefully by giving them a better train and upgrading something that is 15 or 20 years old and starting to look very tired and old, that is going to attract more passengers, more patronage and grow the railway. I think passengers do benefit enormously by having that earlier, up front investment. The longer it is left into the franchise with a few years remaining, they get fewer benefits.

Q20 Mr. Eric Martlew: Why do we not have 20 year franchises?

Mr Metcalf: There is an optimum balance. We moved to eight to ten years. There is an argument in some cases that it could be 12 or maybe 15 years in some circumstances with leverage in big investments. There is an understandable worry that 20 years is just too long in terms of the balance and the risk.

Q21 Mr. Eric Martlew: You are against 20 years?

Mr Metcalf: I think probably 12 to 15 would be the optimum for a big, heavy investment franchise.

Mr Furze-Waddock: I would be against 20 years unless there were defined review periods as Network Rail would have. For us to take a 20 year view on such things as revenue growth is pushing it out an awful long way so the risk increases as time goes by.

This is an uncorrected transcript of evidence taken in public and reported to the House. The transcript has been placed on the internet on the authority of the Committee. Neither witnesses nor Members have had the opportunity to correct the record. The transcript is not yet an approved formal record of these proceedings.

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On behalf of Eric Martlew, 3 Chatsworth Square Carlisle Cumbria CA1 1HB