Yahoo Finance Rail nationalisation goes full steam ahead
The effective renationalisation of the railways has been accelerated after ministers put the industry’s future in the hands of Network Rail and a group of government officials, leaving private sector train operators by the wayside.
Grant Shapps, the Transport Secretary, has asked Andrew Haines, the Network Rail chief, to spearhead a 30-year strategy for the railway called the “The Whole Industry Strategic Plan” (WISP), according to leaked internal documents seen by The Telegraph.
Handing the publicly-funded organisation control of the project will exacerbate fears that the private sector has been left almost powerless to influence major reform on the railways.
Mr Haines will be joined by Sir Peter Hendy, Network Rail chairman and a key transport adviser to Boris Johnson, to oversee the WISP, alongside Polly Payne and Ruth Hannant from the Department for Transport, internal documents reveal.
Elaine Seagriff, former Transport for London strategy director, has been seconded from consultancy Jacobs.
An update on the railways is expected in this week’s Spending Review.
Industry sources were disappointed at the snubbing of bosses from train operators. “The DfT does not have the skills and capability to make key commercial decisions,” one insider said.
A Government source said representatives have been hired to represent train operators’ interests.
The long-term strategic plan is a “key recommendation” by Keith Williams, the ex-British Airways boss who led the biggest review of the railways since the mid-Nineties.
Covid has effectively accelerated rail reform with the cancellation of franchising. However, with demand for train services remaining at less than a third of pre-pandemic levels, keeping services running is costing taxpayers up to £700m-a-month. The Treasury is said to be pushing the Department for Transport hard to reduce the burden on the public purse.
Train operators were disappointed at revelations in The Sunday Telegraph this month that Mr Haines was being lined up to lead an all-powerful “Fat Controller” body that will run the railways.
Steve Montgomery, managing director at FirstGroup, told a parliamentary committee last week that he was “surprised” that regulator the Office of Rail and Road had not been asked to lead the analysis instead.
The sidelining of the train firms comes amid a looming High Court battle with the Department for Transport. Three of Britain’s biggest transport operators – FirstGroup, Abellio and Trenitalia – remain locked in talks over penalty payments that could top £500m.
A spokesman for the Government said: “As part of preparation for the Secretary of State’s plan to reform the railways, early stages work is under way.
“This will require input from the whole rail sector, including train operators, to ensure a long-term strategy that is focused on improving services for passengers and freight.”
