Could ‘Great British Railways’ finally build up a head of steam? | Rail industry

Rail’s great zombie hope lurches on. Great British Railways, the future once unveiled by Boris Johnson – declared at times dead, or alive, or simply locked in stasis – came juddering back into the picture last week.

The late arrival of a draft reform bill could, rail minister Huw Merriman claimed, still mean that plans for a new “guiding mind” for rail, separate from government, come into law this side of an election. “We will put decision-making in the hands of Great British Railways to integrate track and train,” he promised.

But the short document raised more questions from an industry long gaslit by promises of independence, while perceiving more Whitehall micromanagement than ever. Few believe there is time for the legislation to be implemented, even with the promised immediate scrutiny of the transport select committee and an election potentially as late as autumn.

Yet with services disrupted, and costs still far in excess of revenue, the industry consensus is that something must change. The drivers’ union, Aslef, remains in dispute after more than 18 months of strikes over pay. Attempts to cut costs by closing ticket offices foundered in a public backlash. In both rows, reluctant train operating firms have been browbeaten into fronting up for government policy – but with the Treasury having now pumped £42bn into the railway since 2020, according to Merriman, it clearly calls the tune.

Optimists remain. Darren Caplan, the chief executive of the Railway Industry Association, pointed out that passenger numbers have bounced back to more than 1.5 billion a year, heading towards 90% of the pre-pandemic high, with research from consultancy Steer forecasting that those figures could double by 2050.

However, revenues trail the rebound in usage, with more lucrative business travel and commuting now a smaller share of the market, and the guaranteed income of season tickets falling away – adding up, according to the Rail Delivery Group, to a continued £54m weekly shortfall.

Bar the unions, who back full renationalisation, many hope GBR can yet carve out a better place for rail. The draft bill landed, not coincidentally, just hours before the “Bradshaw Address” – the annual railway gathering where transport secretary Mark Harper last year insisted that Downing Street and the Treasury remained fully behind GBR.

Andy Bagnall, the chief executive of Rail Partners, a lobbying organisation for the train operators, opened proceedings by saying: “If we carry on like this, we will put a generation of people off travelling by rail.”

More than one executive confessed they felt the industry was at its lowest point in decades. Dominic Booth, chief executive of Transport UK, lamented that there “has never been a time when operators have had their faces turned so far from the passenger”, while another executive recounted privately how his own son had laughed when he suggested he should take the train – too expensive, too unreliable was the verdict.

Private train operators are eager to carve out a freer role than under their existing post-Covid contracts, the legacy of the overnight abolition of franchising when most travel was abruptly halted at the start of the pandemic. But while the firms have issues with the current regime, Labour’s policy is the one they are most anxious to hear – there is little meat yet on its bones, bar a pledge to take train operating contracts into public control as they expire.

At the Bradshaw event, Merriman and his Labour shadow, Stephen Morgan, laid out pre-election pitches, albeit with Morgan constrained by the party mantra that “details of our policy will be outlined in due course”.

Renationalising operators one by one is low-hanging fruit – a popular policy, cost-free and already partially enacted by necessity by a government which theoretically opposes it. Morgan did confirm that Labour’s renationalisation ambitions would not stretch to privately owned freight – or indeed the rolling stock companies which have hoovered enormous dividends out of Britain, even as the rest of the industry has been hammered by the pandemic and told to make swingeing cuts.

Otherwise, the Labour pledge to “deliver the biggest reform of public transport in more than a generation” by “giving accountability back to the public”, creating “a unified rail network with passengers at the heart”, and “[ending] the fragmentation”, are phrases that have peppered many a recent minister’s speech.

The railway is answering to its fourth transport secretary since reform was first signalled in 2018 – a reminder that Covid is not the only cause of its troubles. Chris Grayling commissioned the full industry review after the chaos of the timetable change in May that year, when several franchises were in a state of financial collapse. When the Williams-Shapps review was published in 2021, a well-staffed transition team, led by Network Rail’s chief executive, Andrew Haines, was tasked with establishing GBR. Further delay has seen the costs of setting up GBR rise from £205m to £381m. Now the draft bill suggests that GBR will be built squarely on Network Rail – while the secretary of state retains wide powers to intervene.

Haines, for his part, said GBR “must not and can never be Network Rail 2.0 … This is a never-to-be-missed opportunity to build something new and better.” But train operators are unhappy about ceding control of the railway to the infrastructure manager, even with assurances that this is simply an initial pragmatic move to speed ahead.

One source said: “He might want to change the culture, but how long has Haines got left? People remain pretty suspicious.”

The likelihood remains that if the plans progress, it will be under a new government. While Labour said the draft bill had “no prospect of becoming law”, its policy – due “in weeks” – is expected to include a similar integrated “organising brain” for rail, a phrase that morphed back into the present government’s “guiding mind” when Morgan spoke this week. Despite Merriman suggesting that Labour’s alternative might be “an unaffordable state bureaucracy run for the benefit of vested interests and trade unions”, he concluded: “No matter who is in my place after an election, I hope they will deliver this rail reform – because the industry is at one in wanting it.”