16
Accepted
Delays in rail reform legislation mean significant forecast savings will not be achieved.
Conclusion
We asked the Department for clarity around how the new contracts would work. The Department told us that it is in the process of developing a further version of national rail contracts, designed to further encourage growth in revenue and passengers, and focus on the passenger experience. It said that until it has real clarity on when GBR will be created, and who the contracting body will be, it will not be in a position to return to competition with passenger service contracts.33 The Department told us that it will have much greater certainty once legislation is in Parliament and it can then start to accelerate some of its plans. It said that the period between legislation passing and GBR becoming operational could take up to two years.34 The Department had expected reform to result in annual savings of £1.5 billion from 2026–27 onwards, but these savings have been delayed with Great British Railways not yet established.35 We asked the Department if it was still on track to meet its planned savings. The Department told us that it does not expect to achieve all the savings it forecast and cited legislation as one of the reasons why it cannot realise the full benefits of reform.36
Government Response Summary
The government outlines its commitment to delivering rail reforms, including introducing legislation for public ownership of passenger services and creating Great British Railways (GBR), to achieve a unified governance structure and improve value for money.
Government Response
Accepted
Government Response
Accepted
HM Government
Accepted
The government has introduced legislation to bring passenger services back into public ownership. Services will transition as existing contracts come to an end or reach their contractual break point as part of a rolling programme, commencing once the bill has Royal Assent. The government has also announced in the King’s Speech that it will bring forward further legislation to create Great British Railways (GBR) – a new arms-length body which will act as a “directing mind” for the railways and ensure the highest standards of customer service and operational performance. It will focus on delivering for passengers and freight customers. The government is committed to delivering a unified and simplified governance structure for the railways, alongside passenger train services under public ownership, with the objective of providing improved services for passengers and better value for money for taxpayers. This model will address current disincentives by ensuring costs and revenue across infrastructure and operations are aligned to optimise performance and drive efficiency. The department expects to see these reforms delivered over the course of this parliamentary term, as new legislation is enacted, and private train operators move into public ownership.
Source
Committee
Public Accounts Committee
Report
Thirty-Eighth Report - Rail reform: The rail transformation programme
27 May 2024
HC 652
Addressee Bodies
HM Treasury
Timeline
Recommendation age
2.2 yrs
Report published
27 May 2024