Policy background
- Prior to the amendments made by the Act, RA93 was inconsistent with the Government’s commitment to bring railway passenger services back into public ownership when existing contracts with private sector operators end.
- This Act is needed because RA93 was designed to facilitate the privatisation of British Rail in the 1990s and established a presumption in favour of private sector operation of passenger services. RA93 empowered the appropriate franchising authority to appoint franchisees following a competitive tender process, and required the appropriate franchising authority, following appropriate consultation, to publish a statement of policy setting out the circumstances in which they would exercise that power. The statements of policy that were published under RA93 reinforced the presumption in favour of franchising to the private sector (by competition where appropriate, or by means of a direct award to a private sector operator otherwise). RA93 also included provision for the appropriate franchising authority to secure services from a public sector operator, but only as a last resort where a franchise agreement was terminated or otherwise came to an end, but no further franchise agreement had been entered into in respect of the services.
- Bringing the operation of passenger services back into public ownership is one element of the Government’s broader plan for the railways, which would also create a unified and simplified governance structure that places passengers at the heart of the mission, objectives and incentives for the railway. This broader plan, which is beyond the scope of this Act, would include establishing a new arm’s length public body – Great British Railways – which would be a directing mind in charge of Britain’s railway infrastructure and services.
- The Government proposes to bring forward further, more extensive primary legislation to address the wider issues later in the Parliamentary session. In the meantime, the purpose of this Act is specifically to facilitate the transfer of train operations back into public ownership, in advance of that more extensive legislation.
