Analysis of the Subsidies Bid for British Rail Passenger Franchises



Analysis of the Subsidies Bid for British Rail Passenger Franchises

Authors

HARRIS N G, The Railway Consultaney Ltd, UK

Description

The Conservative Government re-elected in Britain in 1987 had a large parliamentary majority, and was already committed to the privatisation of a number of utilities. It was therefore no surprise when they announced their intention to ptivatise Britain's

Abstract

The Conservative Government re-elected in Britain in 1987 had a large parliamentary majority, and was already committed to the privatisation of a number of utilities. It was therefore no surprise when they announced their intention to ptivatise Britain's mainline railways. This paper concentrates on the passenger business; freight services and other rail businesses were simultaneously sold off through trade sales, amidst much less publicity.

Various methods of privatisating the railway were discussed (for example at a seminar of the Transport Economists' Group in 1993), but that actually chosen included passenger franchises operating on infias~eture provided by a monopoly supplier - Railtraek. A new Government department was created to sell and monitor franchises for passenger services - the Office of Passenger Rail Franchising (OPRAF). Much initial work was carried, out in splitting responsibilities for infrastructure and operations, and in separating out the operations of different train service groups, of which 25 were created. These Train Operating Units (TOUs) were initially vested as wholly-owned subsidiarie s of the still-nationalised British Rail (as Train Operating Companies, or TOCs), and were progressively sold offbetween December 1995 and February 1997, with private-sector operations usually starting a few weeks after date of sale.

Publisher

Association for European Transport