Government considering taking control of Northern Rail

Management of poorly-performing Northern Rail could be taken into public hands.

The rail company, which operates a wide range of North West rail routes linking key cities including Liverpool and Manchester, has been told to submit proposals to Transport Secretary Grant Shapps who said the company’s poor record “cannot continue”.

Only last week, Metro Mayor for the Liverpool City Region, Steve Rotheram, called on the Government to strip Northern Rail of its franchise after it reduced weekend services running from Liverpool to Manchester Airport.

Grant Shapps today said he had issued a “request for proposals” from the firm and the Operator of Last Resort (OLR), which could lead to services being brought into direct government control.

Giving evidence to the Commons’ Transport Select Committee, Mr Shapps said: “As a fellow long-suffering commuter, I entirely believe we cannot carry on just thinking it is OK for trains not to arrive, or Sunday services not to be in place. That has to change.”

The Department for Transport said it is developing contingency plans for the replacement of the current franchise “with either a new short-term management contract with Northern or the Operator of Last Resort (OLR)”.

It said: “In the context of significant challenges facing the operator, such as delays to infrastructure upgrades and historic underinvestment in the northern rail network, issuing a request for proposal enables the department to examine whether the contract is properly aligned with current operating challenges in the North.

“It also allows us to determine whether the franchise owner or an OLR would be best placed to tackle these issues and deliver for passengers.”

Northern Rail, which is owned by Arriva, has reportedly been losing money for some time.

Passenger numbers dropped after the botched introduction of new timetables in the Summer of last year.

Mr Shapps said: “If you are northern, and you are a Northern passenger, you’re as frustrated as I was in 2018. With Northern [Rail] it has failed to recover.”

Transport for the North said it believed the Northern franchise should be taken into public hands through what is known as an Operator of Last Resort (OLR). The OLR is, on behalf of the Government, currently in charge of London North East Railway, the East Coast Mainline intercity franchise.

However, the Government could also opt for what is known as a “management contract”, which would mean that Arriva would still operate rail services, but the Department for Transport would adopt a much more hands-on role for the operation of the franchise.

David Brown, managing director at Northern, said: “It’s on record that the Northern franchise has faced several material and unprecedented challenges in the past couple of years, outside the direct control of Northern. The most significant of these is the ongoing, late delivery of major infrastructure upgrades.

“The North West electrification was more than two years late, which meant we could not use electric trains on that route or cascade diesel trains from that route to run more services elsewhere on our network. More recently, new and longer platforms at Leeds stations are delayed, which means we have had to postpone our plans to run longer trains.

“These factors – alongside the damage caused by strike action and lower than expected economic growth – have had a significant effect on the revenue expected in our original franchise business plan agreed with government back in 2015.

“That’s why the Government has asked us to prepare a business plan for a shorter ‘Direct Award’. We are well under way with the development of that plan, which will see the completion of our transformation programme.”

He added: “Arriva and Northern remain fully committed to delivering the transformation of the North’s railways and improving customers’ experience. We are delivering the biggest transformation of local rail for a generation, with 29 of our 101 new trains in service from Monday and driver training taking place on dozens more trains right now.

“Alongside 2,000 extra services per week, this is part of a £600m investment in improving customers’ experience; we are continuing to invest in better stations, better offers for customers and more recruitment.

“These discussions have no impact on rail services for customers. Our job is to continue to provide the best service possible for our customers whilst any discussions are taking place.”