READERS of my Long View columns in Railnews, and of some of my recent blogs on this website, may have detected an increasing concern about how our railways are to be developed unless this country’s governance system, both at national and regional level, is changed from its present London-centric control. Now the biggest challenge to the present system will be on 18 September, when voters registered in Scotland answer the question: ‘Should Scotland be an independent country?’
But whichever way the referendum goes, it seems to me there are serious implications for our railway’s organisation and structure.
If the vote is ‘yes’ for independence, I cannot detect that any serious consideration has been undertaken of the implications for the existing (already complex) structure.
And even if the vote is finally ‘no’, against Scottish independence, the additional powers to be devolved to the Scottish government and parliament – which the three main political parties have belatedly said would be quickly implemented – have big implications for the railways, too.
What if the vote is ‘yes’?
HERE are some considerations about the consequences of a ‘yes’ vote.
Firstly, I cannot see how the Westminster government could press ahead with its plan to re-let the Intercity East Coast franchise before next May’s general election. No bidder will want to submit an offer without knowing the longer-term consequences and implications of running a passenger service crossing what will become an international boundary – and, possibly, involving two currencies, and border controls similar to Eurostar’s operations.
Indeed, in the short-term, and because of the uncertainties, it may prove an advantage if East Coast continues to be operated by the Department for Transport’s subsidiary company, Directly Operated Railways (DOR).
The same concerns will relate to the Intercity West Coast franchise, currently operated by Virgin and Stagecoach, when it becomes due for renewal in 2016-17.
The difficulties will even extend to the up-coming renewal of the Northern and TransPennine franchises, as both include cross-border services between England and Scotland (which, after a ‘yes’ vote, would become foreign countries, with all the attendant complications including, again, two currencies and border controls).
As for possible border controls, it really is an irony that no such problems exist in rail operations between Ulster and the Irish Republic – because the latter, like the UK, is not a signatory to the Schengen Agreement that enables passport-free movement across European borders. But if Scotland were to be accepted as a new member of the EU, it would be obliged under EU rules as a new member to sign the Schengen Agreement!
Then there are the political implications following a ‘yes’ vote of passenger train operating company ownerships.
The present Westminster government has been often criticised for allowing TOC franchises to be awarded to foreign-owned companies, or companies with significant involvement with foreign-owned partners.
But if Scotland votes for independence, by my reckoning the only current franchises that will remain operated by wholly British-based operators will be c2c (the London-Southend service run by National Express) and East Coast (DOR, a subsidiary of the DfT).
All the other TOCs will be owned by companies that are either wholly foreign-based (such as Abellio or DB – to be joined after a Scottish ‘yes’ vote by FirstGroup and Stagecoach), or have partial foreign ownership (such as G0via).
Indeed, even if the DfT somehow managed after a ‘yes’ vote to get East Coast re-franchised before the next general election, the TOC would inevitably move into foreign ownership . . . as the short-listed preferred bidders are FirstGroup (Scottish), Stagecoach (Scottish) and Keolis/Eurostar (largely French).
‘Devo-Max’ – Scotland
THERE are also many questions about what will happen to the rail organisational structure if Scotland votes ‘no’ to independence but is then granted additional devolved powers – known as ‘Devo-Max’ – as promised in the last few days by all three main Westminster political parties.
So far there are few details, and the only announcement I have heard about the sort of additional powers that would be devolved came from former Labour Prime Minister Gordon Brown. Significantly, his remarks included the possibility of Scotland having its own publicly-owned railway.
That has considerable implications for the present system.
Can it be accommodated within the present Network Rail structure? Perhaps NR’s recent re-nationalistion may help if the United Kingdom continues, and a Scottish subsidiary can be set up.
What would be the relationship between a Scottish nationalised railway and an England and Wales disaggregated, partially-privatised one, operated by ‘franchised’ TOCs and privately-owned freight operating companies?
Who would own the rolling stock? What would be the role of the rolling stock leasing companies in Scotland?
(These same questions may also be asked in the event of a vote for independence.)
‘Devo-Max’ – England and Wales
MOREOVER, what are to be the consequences after 18 September 2014 on the railway organisational structure in England and Wales of either Scottish independence or ‘Devo-Max’?
Thus far, the Westminster government has made much noise about devolving more responsibilities to city regions and local authorities for train services in the North and the West Midlands.
In Wales the situation is less clear, despite having a devolved Welsh Assembly Government – for example, the argument continues between Cardiff and Westminster about who is to pay for electrifying the Cardiff Valley lines!
And in England the reality so far is that, sadly, little has actually changed.
Indeed, in the North of England the dead-hand of central government control has continued to manifest itself only this week with the withdrawal of off-peak day return ticket validity during the evening peak period on many services operated by Northern. I have much sympathy with the management at Northern (currently half foreign owned by Dutch Abellio, together with British Serco) who have taken a big hit in bad publicity for the new restrictions – but the reality is that raising more fare box revenue was a condition of its masters (i.e., the London-centric DfT and Treasury) extending the franchise.
So much for any proof of real intent to devolve responsibility away from London!
In the Midlands, even less has happened – partly because of an unbalanced local government structure. Birmingham, England’s second city, dominates the West Midlands and this greatly worries even the surrounding metropolitan authorities, let alone the nearby non-metropolitan ones.
Nevertheless, with its partner metropolitan authorities, Birmingham is now central to a new integrated transport authority – but there is no such structure for the East Midlands, despite the size and economic significance of Derby, Leicester and Nottingham. Nor are there any ‘city region’ structures – in the West Midlands because it is feared Birmingham will dominate, and in the East because Derby, Leicester and Nottingham were never recognised as ‘metropolitan’ areas. (The same is true of areas such as Bristol/North Somerset, and Southampton and Portsmouth, for example.)
This muddle is all a consequence of the local government structure bequeathed to us by Edward Heath’s Conservative government 40 years ago, in 1974. In my view, this structure was wrong then (I was a councillor in an all-purpose county borough council at that time and I campaigned against it) and it is even more inappropriate in the 21st Century – complicated now by the creation and addition of Local Enterprise Partnerships in England.
In the North of England there is steadily-growing and widespread demand, apparently supported by the Chancellor George Osborne, himself a Northern MP, for much more devolved power over transport – both infrastructure and services – accentuated by the recent ‘One North’ proposals for a £15 billion boost to east-west transport links, mainly rail-based, over the next 15 years.
And concerns are growing in the Midlands, too – with a major conference to take place next month on the need for the West and East Midlands to draw closer together, including improving east-west transport links to serve and help develop an economy (which includes England principal manufacturing centres) that is already equal to Denmark’s . . . and greater than Scotland’s!
Whether Scotland votes ‘yes’ or ‘no’ on 18 September, there are surely going to be major changes to the way the United (or Disunited) Kingdom is henceforth structured and governed – and the railways will be part of this.
What a shame that no one seems to have been preparing for either possibility!