LONDON (AFP) – Britain yesterday launched a radical overhaul of its coronavirus-plagued privatised rail sector that will see franchises replaced with concessions subject to tougher scrutiny and greater state involvement.
Train services will no longer be managed by franchises, which handed their management to private operator companies, and these will be replaced by concession-style agreements.
“Ministers today ended rail franchising after 24 years as the first step in bringing Britain’s fragmented network back together. The new system will create a simpler, more effective structure and will take shape over the coming months,” the Department for Transport (DfT) said in a statement. While Britain’s rail tracks remain in state hands, the trains are run by mostly private companies enjoying large government subsidies.
But Prime Minister Boris Johnson’s Conservative government decided in March to take on rail franchise holders’ revenue and cost risks as the Covid-19 pandemic decimated demand. The move was part of emergency measures that cost GBP3.5 billion, according to media reports.
Transport Secretary Grant Shapps declared yesterday that the current privatised rail model was not working in the current climate, as many commuters and travellers stay at home.