News | Published October 16 2019

Government considers nationalising Northern Rail franchise

Transport secretary Grant Shapps has said that the government is weighing up taking the Northern Rail franchise into public ownership.

The Northern Rail firm, operated by Arriva and currently one of the UK’s largest rail franchises, has been losing money for several years and its passenger numbers have fallen after its new timetables introduced in the summer of 2018 proved unpopular.

Addressing the Commons’ Transport Select Committee, Shapps has said that Northern’s poor standard of services “cannot continue”, with trains regularly running late or being cancelled completely.

He has also issued a “request for proposals” from Northern Rail and the Operator of Last Resort.

The news comes amid anticipation of a complete overhaul of the rail franchise system, which was outlined in the Queen’s Speech earlier this week. Meanwhile, a full-scale review of the railways in the UK is ongoing, led by former head of British Airways, Keith Williams, with the outcome due before the end of the year.

In his address to the select committee, Shapps said: “As a fellow long-suffering commuter, I entirely believe we cannot carry on just thinking it is OK for trains not to arrive, or Sunday services not to be in place. That has to change.

"If you are northern, and you are a Northern passenger, you're as frustrated as I was in 2018. With Northern it has failed to recover.”

The Department for Transport is developing contingency measures for “a new short-term management contract with Northern or the Operator of Last Resort” to replace the existing franchise.

The DfT said: "In the context of significant challenges facing the operator, such as delays to infrastructure upgrades and historic underinvestment in the northern rail network, issuing a request for proposal enables the department to examine whether the contract is properly aligned with current operating challenges in the North.

"It also allows us to determine whether the franchise owner or an OLR would be best placed to tackle these issues and deliver for passengers.”

Sub-national body Transport for the North said on Friday that its preference would be for Northern to be nationalised via the Operator of Last Resort, which has already taken the London North East Railway franchise into its hands.

Should the government instead opt to place the franchise under a "management contract", Arriva would continue to take charge of services, but would hand more control to the DfT in franchise operations.

However, the Operator of Last Resort has said that any operational changes at Northern could take months to enforce, having closely followed the franchise’s state of affairs for some time.

Managing Director of Northern, David Brown, took a defensive stance, insisting that some of the challenges faced by Arriva and Northern were out of their hands.

One major issue Brown raised was the absence of major upgrades to the railway network that are overdue in the North of England and have been promised by the government previously but since been pushed back.

Brown said: "Arriva and Northern remain fully committed to delivering the transformation of the North's railways and improving customers' experience. We are delivering the biggest transformation of local rail for a generation."

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Authored by

Scott Challinor
Business Editor
October 16 2019

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