Your browser is no longer supported

For the best possible experience using our website we recommend you upgrade to a newer version or another browser.

Your browser appears to have cookies disabled. For the best experience of this website, please enable cookies in your browser

We'll assume we have your consent to use cookies, for example so you won't need to log in each time you visit our site.
Learn more

Rail: is breaking up hard to do?

Olympic railways - How could a Conservative-led rail review affect the structure of the rail industry?

The Conservative Party's announcement last week that it is to review the rail industry took many people, including some in the party itself, by surprise. Shadow transport secretary Chris Grayling admitted for the first time that the Conservative initiated privatisation in the 1990s had not worked as intended, and called for a review.

'We do want to work with the industry to identify a better structure to ensure it can meet the challenges of the next decade, ' he says.

Many in the rail industry have welcomed the party's decision to get back into the transport debate and commentators described Chris Grayling as a man gearing up for ofce.

Network Rail said it would play a constructive part in the review.

'We have, for some time, recognised the importance of increased integration within the rail industry, which is why we have worked with our partners, the train and freight operating companies, to introduce integrated control centres, and to produce joint performance improvement plans, and usage strategies for each route, ' says chief executive John Armitt.

'And these measures are working'.

But insiders say that the track operator is far from pleased with the idea of a review. This is no surprise considering the Conservatives are calling for 'greater integration of track and trains' which could see Network Rail abolished under a Conservative government.

'We are talking about a system where we create six or seven regional companies who take over and operate the trains and the track, ' explains former transport minister Steve Norris.

Norris led the privatisation under John Major and has worked with Grayling on the review. 'I am sure (First Group chief executive) Moir Lockhead would happily run one of them, and (former rail regulator) Richard Bowker and (Stagecoach co-founder) Brian Souter, so you see you virtually have the businesses already, ' he told NCE.

ICE Transport Board chair Alan Stillwell says a regional break up is worth considering.

'There are clearly advantages from integrating Network Rail with the train operating companies. At a local level they should be fully integrated. If one area was to go ahead with this it could be used as a benchmarking opportunity, ' he says Network Rail recently rejected a request from Merseytravel Passenger Transport Executive to manage its local network turned down. Merseytravel claimed the move would have saved £30M per year (NCE 13 April).

'Anybody who wants this (integration) to happen has got to demonstrate an overwhelming business case. There would also be issues with standardisation and interoperability, ' explains Railway Forum director general Adrian Lyons.

To produce that business case means having a clear understanding of costs, something which has evaded the railway industry until now.

'It was a case of shovel money in one end and see what happens, ' says Lyons. 'British Rail had an intuitive sense of costs, Railtrack lost it completely and Network Rail is now reconstructing it, ' he says.

'The Network Rail board is very good at understanding the powers of IT. The high level output statement process has spurred on development faster and is taking the industry somewhere it has never been before, a place where it has an analytical understanding of costs.' But some industry insiders think that it is the people rather than the structure of the industry that is the problem.

'Culturally the industry has a problem. Everyone expects to be consulted on everything and to in uence every decision that gets made, ' says one. 'The industry is complex but the people enjoy that complexity.

It is about the psychology. The Conservatives are missing the point by saying lets re-organise things, it is the culture that has to be tackled.' The Conservatives plan to publish their review in summer 2007, coinciding with publication of the government's 30 year railway plan. 'I do sense the beginnings of a revolution, ' says Lyons.

Perhaps he is right.

Have your say

You must sign in to make a comment

Please remember that the submission of any material is governed by our Terms and Conditions and by submitting material you confirm your agreement to these Terms and Conditions. Please note comments made online may also be published in the print edition of New Civil Engineer. Links may be included in your comments but HTML is not permitted.