Wednesday, 18 April 2007

An open letter to the Secretary of State

Dear Mr Secretary

Almost five years ago your predecessor, Alastair Darling, spoke at the Railway Forum. In his speech he said: “…the Department will always be open to new ideas and approaches. Not just from industry but user groups and the wider public. If there's a case for change or a new approach, let's discuss it.” I hope, Mr Secretary, that you share his opinion because there has never been such a compelling case for change as the situation we find ourselves in today.

Over the past ten years we have witnessed unprecedented growth in rail travel. I know your department is aware of this, not least because it regularly boasts of this trend as some sort of government achievement. Whether this pride is justified is a matter for debate, not least because despite the success of rising passenger numbers, all is not well on our railways. The crux of the problem: supply is not meeting demand.

At the most basic level, there are not enough carriages to properly service the number of passengers the railway is currently carrying, and will have to carry over the medium term. But the problems are not just confined to this issue; supply and demand are mismatched in other areas too. Timetables are not responsive to the needs of local people; some lines experiencing passenger growth have seen a decline in the frequency of services; and, fares are going up while customers feel they are getting a worse, rather than better, travel experience.

These things may seem like a disparate mix of problems with no connection between them. The reality is that they all stem from the same root: a system which is fundamentally flawed. Now I know this system was not authored by your administration, but is a system over which your government has had stewardship for the past ten years. Ten years is a long time. It affords ample opportunity to design and implement something better; something that actually works to the advantage of travellers. Unfortunately, for all their fine sentiments and words, none of your predecessors had the courage to seize this opportunity. Maybe your tenure will eventually prove to be the exception, but from what I have seen to date all you are currently offering is ‘more of the same’. To continue like this would be a shame, so here are some constructive suggestions for your consideration.

First, remove yourself and your armies of civil servants from interfering in the day to day running of the railways. Frankly, Mr Secretary, it’s not something you are terribly good at – although, if it is of any comfort, it’s something no government department has yet mastered. For example, when you set First Great Western’s December timetable – which, despite your claims to the contrary, you did via the SLC2 specification – you completely messed up what was, previously, a perfectly viable service. You did this because you were meddling in something you had very little knowledge of: timetable setting is a practical matter, not some theoretical exercise that can be managed from a dusty room in Whitehall. You may have noticed that many parts of our economy run perfectly well without micromanagement from the state; indeed, they are generally far more successful than those parts under central control. Nota bene!

Second, sort out the franchising system. There are lots of practical things you can do, but the current mechanism just doesn’t work to the advantage of anyone. You could, if you had the political courage, issue long term franchises – say 25 years plus. This would give train operating companies a real chance to develop strategic visions for their areas rather than being a hostage to the short-termism imposed on them by their contracts. They would also be much more willing to invest in new rolling stock to aid with capacity problems. In short, longer franchises equal more private investment.

Third, when you issue franchise specifications you need to make sure your calculations stack up and that you take a holistic approach to passenger growth. What do I mean by this? Well, Mr Secretary, take the First Great Western franchise as a case in point. Your department was certainly beguiled by First Great Western’s growth projections – which were higher than your own (probably because they are more sensitive to market reality than your planners) – and you were keen to extract the financial premium that such growth would allow. However, you didn’t really think about the flip side to this: how that demand would be met. You didn’t, for example, build in much of a provision for new rolling stock. In fact, truth be known, other than accepting First Great Western’s refresh programme which will introduce more seats on the HST services, you didn’t build in a provision for ANY new rolling stock. That’s hardly integrated thinking.

Fourth, and this is most important, you need to be open and honest about your approach. You are the sole guardian of rail strategy. The government sets the parameters of the system and determines the way in which it will be run. You, and only you, have the power to issue and rescind franchises. You have all the power but it seems that you want none of the responsibility that comes along with it. On the December timetable issue you blamed First Great Western for the incompetence of your own planners. When the GNER franchise collapsed you blamed the company’s management, even though your own department should have recognised the financial shortcomings in their bid. Quite simply, Mr Secretary, it’s not good enough and you have got to do better. If you want to make unpopular decisions because you think they are right then have the courage of your conviction and explain to people what you’re doing and why. If you make mistakes you should admit to them and move on, not try to shift the blame to save your own skins.

There is, of course, much more advice I could give you but implementing these first four steps would represent a very good start.

In closing, I do not seek to claim that all the failings on today’s railways are down to your department. I do believe, however, that whether deliberately or accidentally, government policy has exerted a negative influence and held back the railways for far too long. So my message to you is quite simple: get off the track, Mr Secretary, you’re delaying progress.

Yours sincerely

CJ Harrison

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