Proposal for The Restructure of the Rail Network
1. Reasons for Failure of the current arrangements.
There are 24 companies providing Rail and associated business services.
Railtrack, the organisation with responsibility for managing the network of rail and track facilities has been taken back into public management to prevent further deterioration.
The catalogue of “Franchise” failures and changes since Privatisation proves Government’s and the Private Sector’s inability to establish a Rail Network fit for purpose.
Privatisation caused fragmentation and dysfunction. Private sector opportunism disregarded the need to create services for travellers and business communities, and minimised investment while increasing fares for Passengers and Freight.
Each Franchise or Contract performed as a separate entity. There was minimal attention to planning or promoting integrated growth and no recognition of the multiplicity of separate needs facing the incredibly complex organism that is the Rail Industry.
2. Capitalising on Recognising a Problem.
The change to commuting as a result of COVID-19 and the suspension and projected review of contracting methods, provides a unique opportunity to revolutionise Rail services. “The Government initially suspended rail franchising in order to maintain service, as passenger demand fell due to the COVID-19 pandemic. On 21 September 2020 the rail franchising policy was permanently abolished. Emergency arrangements remain until Government legislates for a replacement to the system”.
(Comment from the Department of Transport).
Now is the time to restructure the framework to provide an outstanding Rail Network fit for the present and future needs of this country.
3. What is needed?
A) A New Overarching Managing Company to ensure the integrity of a de-nationalised organisation, with the implicit and sole intention of managing the Rail Industry on behalf of Parliament and the country. This company will ensure that the Rail Industry, however it is contracted, has a conduit between the Secretary of State, (sic Govt Policy) and the companies contracted to run the systems.
B) A Redefined Railtrack is the heart of the rail industry. To honour de-nationalisation, responsibility for the Network should be managed through a Company linked with the Federation of Companies proposed.
C) A Federation of Rail Industry Boards would ensure that every contracted section of the Industry would be coordinated. Each Company would retain and operate under the integrity of its own Terms of Reference whilst ensuring that it remained part of a bigger operation
“Federation is the coexistence of independent companies with a shared vision and at the end of the day, to a large extent a common Profit & Loss” (Definition).
Organisation
A) The Management Company
1. The Secretary of State would have political responsibility for this company and appoint a Chairman answerable to his or her department.
2. The directors of the company would to be appointed from members of the contracted Companies including Railtrack and include a representative from the Department of Transport.
3. This company would exist to
a. ensure dialogue between all those responsible for providing an effective Rail Network within the Government’s declared policy for the Rail Industry.
b. identify of the needs of the users (paramount).
c. integrate the services dependent on crossing and using multiple miles of Railtrack which requires understanding multiple commercial plans.
4. The role of the Main Company Board must be accepted by the leaders of the companies contracted for their operation. Terms of Reference/Articles of Association should reflect this.
5. The Secretary of State and the Chairman of the Board will be responsible for establishing and agreeing the requirements determined by Government and their delivery.
6. Board Membership
Chairman Director of Finance Director of Public Affairs Representatives from Dept of Secretary of State Director of Health and Safety Director of HR The Chairs of Boards of every Federated Company, and/or their Chief Executives and Finance Directors. (Minimum 1 Representative for each company)
B) A Redefined Railtrack.
The Terms of Reference and the relationship with the Department of Transport will need careful planning and drafting. Its relationship with all “Federated Companies” is critical.
C) Federation of Rail Industry Boards.
A Federation would ensure that every contracted section of the industry would work for the whole structure. Each company would retain and operate under the integrity of its own Terms of Reference but remain part of a bigger operation.
Representatives on the “main board” from the franchised companies will ensure that government determined requirements are achievable within their own company. Each company will be required to resolve differences of opinion and objectives, mindful of the needs of other Companies in the Federation. Federated Companies should be autonomous and answerable to their shareholders, clients and business partners. Their Terms of Reference should acknowledge that their operation is answerable to Parliament and the Community. In addition, they should bring any problems to the main board for resolution so that disruptions, such as those arising in the last few years, are reduced to the minimum.
The Trade Unions.
Establishing a new relationship with the Unions is vital. Substantial disruption to travellers’ services over a number of years has cost millions of pounds.
Discussions with Unions should introduce an invitation for each Federated Company to have a non-executive Union Board member appointed bi-annually. There should also be a Recognition Agreement with agreed terms of reference as part of the HR operation of each Company.
2. Occupational Health and Safety.
About 250,000 staff are employed by the Rail Industry. A Director of OH&S and a support department should be available to advise all companies. This would reduce inconsistencies. The costs should be offset by the reduction of “incidents”.
3. Diversity. The Rail industry has an ethnically diverse workforce. Diversity Targets and supportive procedures should be set and agreed with the Unions.
Anthony Austin CFIPD (Retd)
1052-11