MPs warn over ‘not fit for purpose’ rail model

The Transport Committee has warned that the UK’s rail franchising model is ‘no longer fit for purpose’ and is failing passengers.

The Committee’s report claimed the current model of awarding franchises to companies to run services in different parts of the country had enabled the rise in passenger numbers. However, it highlighted that the model has not encouraged competition in the way the government had hoped.

The report raised concern that: “The current structure of franchises limits the ability of the private operator to deliver on the core policy objective of driving efficiencies and delivering benefits for passengers. Specifically, the general size of current franchises does not provide a clear enough market focus for the operator; and the relatively short length of franchises reduces the incentive of operators to both invest and drive down costs.

“While we acknowledge that there can be no single “template” of what a franchise should look like—as the rail network and passenger needs are diverse—there is merit broadly in procuring longer and smaller franchises. Immediate widespread reform is neither practical nor feasible. Where a franchise is due to expire the government should, as a matter of routine, review the franchise contracts it lets so that they present less risk to the taxpayer, are not unnecessarily complex, and are focused on the market they serve.”

A spokesman for the Department for Transport said: "We can make improvements and the transport secretary has been clear that it will take new ways of working, more investment and better collaboration across the industry to tackle the challenges ahead."

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