Railways: Great Western franchise, 2006

Standard Note: SN/BT/4004 Last updated: 7 April 2010

Author: Louise Butcher Section Business and Transport

This short note looks at the terms of the Greater Western franchise which was taken over by First Group on 1 April 2006. Many MPs in the South West received representations from constituents about proposed cuts to their rail services after First took over the franchise.

All the relevant documents for the franchise are available on the ’s website. More information on passenger rail franchising can be found in HC Library standard note SN/BT/1343, available on the Railways topical page of the Parliament website.

Contents

1 Franchise specification 2

2 Timetable changes 5

3 Parliamentary and media coverage 8

This information is provided to Members of Parliament in support of their parliamentary duties and is not intended to address the specific circumstances of any particular individual. It should not be relied upon as being up to date; the law or policies may have changed since it was last updated; and it should not be relied upon as legal or professional advice or as a substitute for it. A suitably qualified professional should be consulted if specific advice or information is required.

This information is provided subject to our general terms and conditions which are available online or may be provided on request in hard copy. Authors are available to discuss the content of this briefing with Members and their staff, but not with the general public. 1 Franchise specification On 13 December 2005 the Department for Transport announced that First Group had been awarded the contract to run the Greater Western franchise from 1 April 2006.1 The Greater Western franchise includes routes on the national rail network previously operated by First Great Western, and . A map of the franchise is included on the last page of this note. The franchise is for a ten year term with a three year extension available on fulfillment of certain performance criteria.

First Group bid for the franchise on the basis of the Strategic Rail Authority (SRA)’s specification, set out in the stakeholder consultation document.2 This, in turn, was based on the Route Utilisation Strategy (RUS), published by the SRA in June 2005.3 The RUS had been out to consultation, between January and June 2005 and set out in some detail the services the Government were prepared to support. The bid was to be based on an initial service level commitment (SLC1) based on the existing timetable until December 2006 and SLC2 thereafter.4 The stakeholder consultation document called for certain service cuts either to secure improvement in performance or to save money:

The franchise will combine three existing franchises (First Great Western, First Great Western Link, and Wessex), and will be one of the first in which bids are made against a precisely specified base case. Where possible, this specification builds on the ‘Wider Benefits’ timetable implemented in December 2004, while also making some changes, designed to support government’s primary objectives for railways:

• Reduced subsidy requirement; and

• Improved operational performance.

With the support of the SRA, the existing franchisees, First Great Western and First Great Western Link, implemented the ‘Wider Benefits’ timetable in December 2004. Where possible, the new franchise will build on the successes of this timetable, such as the improved operation of the critical Paddington-Reading section, while also initiating some significant changes, primarily for the purpose of more closely matching resources to demand.

Broadly, the approach in specifying the franchise has been to match the use of capacity and deployment of resources as effectively as possible to reflect growing demand in the area, and lower levels of demand elsewhere, following the SRA’s soon to be published Great Western Route Utilisation Strategy (RUS) where appropriate, within the overall financial and performance objectives for the franchise.

The base case for the bid will consist of Service Level Commitment 1 (SLC1), the existing timetables, which the franchisee will be required to operate until the December 2006 timetable change date, and of Service Level Commitment 2 (SLC2), the SRA’s new timetable specification to be applied from December 2006 for the rest of the franchise term. This approach is designed to build on the growth in demand evident in recent years, to encourage further growth and to support planning authorities in the South West in achieving their development objectives, whilst meeting the affordability criteria. The Service Level Commitment 2 is described in detail later in this document, but principal improvements to the current service are:

1 DfT press notice, “Department for Transport announces winner of Greater Western Franchise”, 13 December 2005, 2 SRA, Greater Western Franchise Stakeholder Consultation Document, June 2005 3 replaced by a new RUS in March 2010, available on the website 4 both SLC1 & 2 are available on the Department for Transport’s website

2 • Segregation in Monday – Friday peak hours of use of the two pairs of tracks between Paddington and Reading (the Main Lines and the Relief Lines), with exclusive use of the Main Lines by trains capable of running at 125 mph; the purpose is to improve operational performance, and to minimise the consequences of delay;

• More 125 mph trains;

• Additional peak hour seats into and out of London;

• Improved frequency (three trains per hour) on the – Windsor line;

• Half-hourly service frequency between Reading and Gatwick rather than the current hourly;

• Simplified service between , and Penzance to give a more regular pattern;

• New pattern for cross-Bristol services, with through services Worcester/Gloucester to Weston-super-Mare/Taunton and Cardiff to Westbury/Weymouth/Southampton replacing radial services which currently start/terminate in Bristol, offering more through journey opportunities, and improved performance; and

• Daily inter-city standard services between London Paddington and , reflecting the nature of passenger demand to this destination; and

• Extension of Paddington to Bedwyn services to Westbury.

The specification process has also shown the need for some reductions in service, either to secure important performance improvements for the majority of users, especially:

• Withdrawal of Slough stops from Main Line services (in order to achieve better performance on Main Line services); or where demand levels no longer justify taxpayers’ support for the existing level of service;

• Withdrawal of off-peak Paddington to semi-fast services (although the hourly semi-fast Bedwyn service will be extended to serve Westbury);

• Reduction of services on the – Bicester Town route to morning and afternoon only because of low usage;

• Reduction of services on the Swindon – Westbury via Melksham route, to match demand, which is mainly for commuter travel; and

• Reduction of stopping services on the Par – Newquay branch.

In addition, the base timetable for the franchise includes two service groups which the SRA is concerned may not represent good value for money because of low passenger demand. Therefore the SRA is requesting bidders to outline the costs of running the following services separately:

• The overnight service between Paddington and Plymouth/Penzance, which conveys sleeping coaches and seated accommodation; and

3 • The off-peak half-hourly services between Paddington and Cardiff.

The SRA is keen to build an accurate picture of the cost of running these services, but no decision on their future has been made.

In addition to bids against the base case, the SRA requires bidders to submit a High Return Alternative Tender (HRAT), and invites them to submit an Alternative Tender. The HRAT requires the lowest possible cost consistent with meeting the franchise objectives, while the Alternative Tender may offer benefits such as greater efficiency, improved performance, shorter journey times, and higher growth by offering a different service specification consistent with meeting the franchise objectives.

The new franchisee will be required to participate fully in the Community Railway Strategy, launched in 2004, with the benefits arising particularly in and Cornwall, and also potentially elsewhere.

Bidders have considerable freedom in developing their bids, both in respect of the timetable, particularly away from the London – Bristol/South /Oxford routes currently operating close to capacity, and in terms of rolling stock deployed.5

When the franchise was awarded, the accompanying press notice set out changes from the original consultation document, that First had agreed to deliver, including:

the following changes to the original specification have been agreed with the Franchisee;

• The London-Cardiff (and vv) off-peak half-hourly service is retained;

• A London-Penzance overnight service is retained and simplified with the separate Plymouth portion removed ( the service will continue to call at Plymouth in both directions but will not have a dedicated sleeping coach);

• the current level of off-peak mainline stops at Slough will be retained. Slough branch line stops will be retimed to co-incide with mainline stops to/from London, thereby improving connectivity. The performance risks of stopping on the main line at Slough will be mitigated through robust timetabling and this approach has been agreed with Network Rail;

• in order to maintain London connections with off-peak stops at Slough (above), the Windsor - Slough services will remain a half-hourly service as now (20 minutes in the peak hours);

• 6 trains per weekday on the Oxford-Bicester line, with realistically timed peak hour services;

• faster journey times between London and Cheltenham;

• The quantum of off-peak Didcot calls will remain as current;

• A daily direct Frome-London return service is introduced;

• Better connections with mainline services from the branch lines in Devon and Cornwall;

• A direct 1 train per day London-Newquay service will only operate in the high peak of summer (July/August). Due to current track quality it is not possible to

5 op cit., Greater Western Franchise Stakeholder Consultation Document, pp3-5

4 introduce a year-round service initially, however DfT, First Group and Network Rail will work together to deliver a year-round service in the future if possible.

In many cases these changes address specific issues raised by stakeholders during the consultation which took place this summer.6

2 Timetable changes First Great Western (FGW) drew up its draft SCL2 timetable for December 2006, which it consulted on between 13 February and 8 March 2006.7 All MPs with constituencies on the route received a copy of the draft timetable. FGW received 3,500 individual responses and in addition petitions with 5,300 signatures.

The Passenger Link Manager from Passenger Focus (formerly the Rail Passenger Council) for FGW collected representations from passengers and responded to the timetable consultation. Passenger Focus made a general response to the timetable consultation as follows:

Whilst we admire the skill with which much of the timetable planning has been done, we are disappointed at the rather London-centric emphasis which appears to have been applied to the thinking behind this document. The timetable also seems to have been driven by operational considerations indicating lack of local intelligence, such as flows generated by the needs of schools or of particular employment or leisure patterns particularly in the far reaches of the South West.

Significant locally negotiated timetables on local services and on branch lines such as those on the Devon & Cornwall branches to , Newquay and St Ives have been swept away and the suggested replacement timetable would appear to provide a much lesser service to passengers in those areas.

The importance of retaining early and late evening services has also been missed across large sections of the region which will rob early commuters of their only form of transport to get to their place of employment. Peak services have also suffered in the important travel to work area of Plymouth, Truro, Exeter, Greater Bristol, West Wiltshire and on the Cardiff/ Portsmouth routes.

We are extremely disappointed at the proposed withdrawal of the London/Plymouth semi fast services which has created severe problems in respect of availability of services at Newbury, and the exacerbation of connectivity issues at Westbury. This action has also created the loss of three of the four three hourly services each day to Plymouth which will significantly impact on the business community in the Plymouth Cornwall areas.

The new Greater Western Franchise as specified represents a significant missed opportunity to review and improve the Bristol to Weymouth service to meet rapidly escalating demand and to encourage further transfer to rail from the private car. In particular, this should have been the moment when the Westbury to Weymouth section of the route finally ceased to be viewed as a rural “branch line”, and recognised for what it in fact is – part of a key inter regional direct route from Bristol to Weymouth serving both rural and substantial and rapidly expanding urban markets along its entire length. This is an almost entirely retrograde specification for service to the majority of communities along the route, most specifically between Westbury and Weymouth. Unless First Great Western are able to successfully negotiate more viable alternatives

6 op cit., “Department for Transport announces winner of Greater Western Franchise” 7 details of the consultation available on the archived FGW website

5 to train timings, this will result in a negative impact on existing rail demand/revenues, local economies and the environment, and will be likely to create further social exclusion and unemployment.

We also have serious concerns with regard to capacity issues particularly in respect of what we understand to be the planned rolling stock allocation where it has been suggested that current three coach formations are likely to be reduced to two particularly on the cross Bristol and Cardiff/Portsmouth routes. If this is you plan then we would urge you to re-examine your information on these routes as a matter of urgency. Passengers using these services regularly experience severe overcrowding during peak times and with projected urban growth, the situation is only going to get worse. It also made detailed comments on the timetable based on comments from received from passengers and interested groups across the region.8

FGW said that it had included services where it had identified a commercial case or had already been able to address significant stakeholder concerns – including retention of the Cornwall–London sleeper service and half-hourly London-Cardiff services.

FGW announced on 3 April 2006 that following the consultation it had made some alterations to its proposed December timetable. The changes to the draft timetable included:

Bristol, North Somerset and Wiltshire

An early morning service will operate at around 0500 from Bristol Parkway to London Paddington, serving Swindon, Didcot Parkway and Reading.

The two London Paddington to Exeter St Davids semi-fast services will continue. This will allow the continuation of hourly services at Bedwyn and Kintbury, with one two- hour gap in the early afternoon.

Services on the will be retimed to better cater for schoolchildren.

High Speed Train services from London Paddington to Weston-super-Mare will be retimed to provide more capacity from Bristol Temple Meads in the evening peak

Services between Bristol Temple Meads and Weymouth will be retimed to better suit leisure and commuter customers on the line, including the retiming of a morning peak service from Frome to Bristol Temple Meads. Connections at Castle Cary to and from the West of will be improved as a result.

The West of England and South Coast

The existing two London Paddington to Exeter St Davids stopping services in each direction will continue. This will allow the continuation of hourly services at Bedwyn and Kintbury, with one two-hour gap in the early afternoon. It is also expected to enable the provision of two three-hour journeys between Plymouth and London Paddington in each direction.

The number of London services calling at Totnes and Tiverton Parkway will be increased to a level similar to the current timetable.

Dawlish Warren and Starcross will benefit from daily through services to and from London Paddington for the first time, which will also provide extra capacity between the two stations and Exeter St Davids.

8 Passenger Focus, Greater Western Franchise: December 2006 timetable consultation, 19 May 2006, covering letter

6 Additional calls will be made at Saltash and St Germans to provide nine daily services each way, compared with six in the draft timetable.

The early morning stopping service from Penzance to Plymouth will be retimed to connect with a northbound service

The 1600 Plymouth to Liskeard service will be extended to Penzance to provide an evening peak service for stations in Mid and West Cornwall.

Services between Exeter St Davids and Barnstaple will be extended to/from Exeter Central.

The first service from Barnstaple to Exeter Central will arrive at around 0815, rather than 0745 to better meet the needs of commuters, and trains on this route will have additional intermediate stops.

Options for providing an earlier service on the Gunnislake to Plymouth line are being developed ,

Services between Bristol Temple Meads and Weymouth will be retimed to better suit leisure and commuter customers on the line, including the retiming of a morning peak service from Frome to Bristol Temple Meads. Connections at Castle Cary for the West of England will be improved.

A shuttle service will be introduced between Westbury and Southampton, including calls at Dean and Dunbridge. This will operate until December 2007, when service levels will be reviewed in the light of subject to the new franchise.

An additional London Paddington to Penzance service will call at Hayle.

The last train from Paddington to the West of England will depart later, at 20.35 rather than 20.18

The Thames Valley and North additional service with six carriages (around 500 seats) will operate from Twyford to London Paddington arriving at around 0730, calling only at Maidenhead.

The journey time between Slough and London Paddington will be reduced by removing some Ealing Broadway calls, compared with the draft. The number of calls at Ealing Broadway will remain similar to the current timetable.

A High Speed Train from Bristol Temple Meads will call additionally at Slough providing a fast early morning service at around 0655.

Services on the Thames Valley branchlines will be retimed to call at all stations, except the 0556 Maidenhead to Marlow, which will not call at Furze Platt or Cookham.

Services on the Henley branch will be retimed, including additional calls at Wargrave and Shiplake, to better cater for schoolchildren

An earlier first train to London will be provided from Iver, Langley and West Drayton.

A better spread of fast trains will call at Didcot Parkway in the evening peak.

Services at stations between Oxford and Didcot Parkway will be broadly in line with the current timetable.

7 An evening service will operate from Oxford to Banbury at around 2050, calling at Tackley, Heyford and Kings Sutton.

Basingstoke and the North Downs

An earlier service will be provided from Reading to Basingstoke at around 0530, and in the reverse direction, a later service will be provided at around 2350.

Services between Reading and Gatwick Airport will still increase from hourly to half- hourly, but with a revised stopping pattern, in particular to address college traffic. 9

FGW said that their timetable experts had analysed the feedback and had identified with the Department for Transport where changes could be made. An article in the Plymouth Evening Herald quoted a spokesman from South Hams Friends of the Earth who said that the announcement dealt with a handful of services to London but the big cuts were in the local rail services.10

3 Parliamentary and media coverage An article in The Times covered FGW’s proposed cuts to rural services, particularly in Devon and Cornwall. The article suggested that the cuts were due to the high premium First Group would be paying to the Department for Transport to operate the franchise:

Branch lines across the West Country are to lose up to half their daily trains, despite rapid growth in passenger numbers over the past four years.

The Government, which wants to reduce the rail network's £ 5 billion annual subsidy by at least £ 1 billion, has authorised the biggest cuts to rural services since the Beeching report of 1963 after claiming that the lines are so poorly used that they are "in the last- chance saloon".

However, official figures obtained by The Times show that passenger numbers on the lines have increased by up to 40 per cent in the past four years, more than double the average rate of growth across the network. The figures are from Wessex Trains, the present operator, which has increased frequency at minimal extra cost since taking over in 2001. First Group, which takes over next month, has announced that services will be cut on all branch line in Devon and Cornwall.

Last week The Times disclosed that First was merely complying with the service levels set by the Department for Transport. , the Transport Secretary, tried to blame First for making the cuts, but has now admitted that he approved service levels well below the present frequency.

On the Newquay branch in Cornwall, which will have only four trains a day from December instead of seven, passenger numbers have grown by 40 per cent since 2001.

The St Ives branch will lose ten of its twenty-six daily services, despite attracting 25 per cent more passengers. The , which recorded growth of 16 per cent, will have its services cut from thirteen to eight.

In Devon, the from Exeter to Barnstaple will lose one service a day and most trains will no longer stop at several small stations. Wessex had upgraded them and installed new shelters, resulting in a 26 per cent increase in passengers.

9 FGW press notice, “First Great Western announces changes to draft December timetable “, 3 April 2006 10 “Protest over railway cuts”, Evening Herald (Plymouth) 7 April 2006

8 Stuart Walker, Devon and Cornwall secretary of the Railfuture campaign group, said: "It is absurd to be cutting services on lines which are proving increasingly popular. Ministers keep saying they want more people to use public transport, but as soon as they do services are being cut." He said that it was deceitful of the Government to claim that the cuts were a commercial decision. "These cuts are the result of a reduction in public support for the railways," he said. "The Government could have stipulated that the existing frequency must be maintained, but it failed to do so. It's not just the branch lines but the main line too, where commuter trains which have standing room only are being withdrawn."

The 17.16 from Truro to Penzance, which carries 200 commuters, is being withdrawn, leaving a 100-minute gap in the timetable. Mr Walker said he feared that many commuters would switch back to cars.

Tim Davies, head of transport co-ordination at Devon County Council, said that the Government had failed to inform rail users about its plans to withdraw support for rural services. "It's been done behind closed doors because the DfT wanted to get the highest possible premium payments from First," he said.

First has agreed to pay the DfT £1 billion over the next ten years for the right to operate the Greater Western franchise.

Railfuture had hoped that First would use its profits on the lucrative London-Bristol main line to prop up rural services in Devon and Cornwall. However, the DfT is instead allowing First to cut services on the branch lines to fund the premium payments.

Chris Grayling, the Shadow Transport Secretary, said: "Alistair Darling seems to be turning into a cross between the Fat Controller and Dr Beeching." 11

Naturally, there was a considerable amount of coverage in local newspapers in the South West. For example, the Western Daily Press reported a number of views:

David Redgewell, regional spokesman for lobby group Transport 2000, said he sympathised with FGW because the proposed cuts were being led by central Government.

But he has urged communities and those who use the trains to act immediately to outline any concerns they had about the future of the region's rail services.

Mr Redgewell said: "Western Daily Press readers must contact their MPs and write to Transport Secretary Alistair Darling as well as writing to First Great Western, because it is important that pressure is heard. This is a political position taken too far. First it was cuts to the health service, now it is cuts to the rail industry. We will be asking Alistair Darling to think again about making such rash changes to the timetable. The level of changes is quite severe."

Several West services will be affected by the proposals. Mr Redgewell said: "If they go ahead with these plans, the number of trains between Swindon and Melksham will be cut from five a day in each direction to just two in each direction." Passengers would also be affected by the loss of off-peak services between Pewsey and stations west of Westbury because of the withdrawal of most Paddington-Exeter "semi-fast" services.

The withdrawal of the Penzance-Westbury-Portsmouth through-service, and the replacement by bus of yet another train a day between Avonmouth and Severn Beach, would also hit passengers.

11 “Rural rail services to be cut despite growing popularity”, The Times, 9 March 2006

9 Gordon Edwards, secretary of the South West Public Transport Users' Forum (SWPTUF), said: "It's not only an issue of when trains are going to run but also how many carriages are going to be on the trains.

"It could cause severe overcrowding on local services. We may still have the trains, but seats are going to be cut by up to 40 per cent at peak times." SWPTUF chairman Christopher Irwin said the West's rail network continued to be a "soft touch" when it came to funding and investment. He said: "That is why we need to fight for what we want now." FGW managing director Alison Forster urged West rail users to submit more views before tomorrow's deadline and insisted FGW would change parts of the timetable if resources allowed.

She said: "This is not just about ticking a box and I believe there are some things we can change if it is within existing resources and if there is a business case to change it." 12

The Torquay Herald Express reported:

Pressure is continuing to mount on the government over plans for major cuts in rail services to the area […] Mr Darling's decision has seen services slashed at many smaller stations and led to fears that full-scale closures could follow.

[…] First Group last week confirmed it was set maximum service levels on some routes when bidding for the franchise last year. The Department for Transport insists the company is free to offer more "commercial" services. It comes on top of concerns over the proposed downgrading which will see direct trains cut from Waterloo to Torbay. The Department for Transport's draft South West Trains franchise proposes stopping all Waterloo services at Exeter. 13

Responding to a Westminster Hall debate on the franchise specification in April 2006, the then Transport Minister, Derek Twigg, gave the Government’s view as follows:

I understand that most Members are here today because they are not happy with various things, but we must consider the bigger picture. It is important to remember that these are good times for the railways. A record amount is being spent—£87 million each week—and, on average, train performance is above the target of 85 per cent. that we had for March this year. More than 85 per cent. of trains run on time, and many train operating companies are now hitting 90 per cent. and above. There has been a significant improvement in reliability and significant investment in rolling stock, with about one third of it being replaced.

It is not the case that people have been put off using the railways. Last year, there were more than 1 billion passenger journeys—a further increase. There are more passengers than there have been since the early 1960s on what is, compared with the pre-Beeching railway, a smaller railway. That is a significant improvement.

On the comment of the hon. Member for Totnes about FirstGroup, it put in a bid for the franchise because it obviously thinks that it is a good commercial proposition. It believes, as do we, that the number of passengers will continue to grow.

It is important to give some background. It was clear from the start that specifying the service to be provided by the new Great Western operator would be an intricate task. We must balance issues of affordability, service, value for money and performance

12 “Deadline now approaching platform one is passengers' last chance to save rail routes”, Western Daily Press, 7 March 2006 13 “Fears over rail cuts”, Herald Express (Torquay), 9 March 2006

10 when awarding a franchise. At the same time, this is a truly regional franchise that brings together services of all types: inter-city, inter-urban, commuter, local and rural. By contrast, most previous franchises tended to be of one particular service type.

The Great Western franchise is a particularly large and detailed franchise. It also operates across a wide geographical area including, for example, parts of London, the Thames valley, the south midlands, Bath, Bristol, south Wales and the south-west peninsula. That makes it one of the most operationally complex franchises on the network.

One of the great benefits of the new franchise is that it allows us to ensure that Network Rail has to deal with just one train operator across most of the network west of Paddington. That should bring real advantages for passengers, too. For example, it will greatly simplify the operation of major stations on the routes for Paddington, Bristol Temple Meads and Reading.

The core of the specification is the service level commitment, which typically lays down the minimum number of trains that must run on each route, the time of early morning and late evening services, journey times and calling patterns. However, the Government do not specify every aspect of a service. For example, rolling stock, which hon. Members have mentioned, is largely a matter for bidders, who must ensure that trains can achieve the speeds needed to deliver the service, and that there is enough rolling stock to meet the operator's own forecast of demand.

Fares, too, are a matter for the franchisee, provided they comply with the Government's policy on regulated fares. Increases on such fares are limited annually to 1 per cent. above the rate of increase in the retail prices index. I probably ought to mention as well that catering on trains, a subject which is of great interest to the hon. Member for Totnes—he has previously raised it with me—is entirely a matter for bidders to propose.

In short, we aim for a specification that is detailed enough to ensure that value for money for the taxpayer is properly balanced against the needs of passengers. At the same time, we recognise that operators, not Ministers or civil servants, are experts in delivering train services. We therefore leave to them as much of the operational detail as is reasonably possible.14

14 HC Deb 25 April 2006, cc205-206WH

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