From the FT

Ministers have lowered performance standards for the UK’s largest rail
franchise after its operator Govia Thameslink Railway failed on most
measures of service quality in the first year of its contract.

The softening of the targets for the company that runs three of the busiest
commuter rail routes into London could trigger millions of pounds in bonus
payments to the company, a joint venture between privately owned Go-Ahead
and Keolis, a subsidiary of French state-owned rail operator SNCF.

The lower targets for the 12 months to the end of March 2024 are published
in filings on GTR’s website, which also showed that the company regularly
missed at least two-thirds of the nine service-quality measures in the
first year of its contract, which began on April 1 2022.

GTR confirmed the government had loosened seven of the targets but said
performance benchmarks were just one metric that the government took into
account in triggering any bonus payments. Some of the performance standards
that were lowered included metrics for train cleanliness, ticketing and
staffing, and customer service.

“Our absolute focus is on providing improved services for our customers, as
demonstrated by nine out of 10 trains arriving within five minutes of their
scheduled time in the year to March 2023,” the company said.

Louise Haigh, Labour’s shadow transport secretary, said the decision by
ministers to soften the targets and the potential for bigger performance
payouts left the government with “serious questions to answer over
mismanagement of taxpayers’ money”.

“Rather than demand better on behalf of passengers, ministers have sat back
and watched failing operators be rewarded with taxpayer-funded bonuses,”
she added. “It is passengers and the hard-pressed taxpayer who are paying
the price for this broken system.”

Under the terms of its six-year contract awarded in 2022, GTR is paid a
fixed management fee of £8.8mn per year, with the chance to earn an
additional performance fee of up to £22.9mn per year. This maximum fee of
£31.7mn per year is equivalent to a margin of around 1.85 per cent of its
cost base.

The government stepped in to save the rail industry from collapse when the
coronavirus pandemic struck and assumed all financial risk by shifting
train companies on to tightly controlled contracts that paid a fixed
management fee.

Under the regime, which gives operators a steady and effectively risk-free
return, ministers can vary the service quality schedules and benchmarks.
One government official said it was not unreasonable for ministers to tweak
the targets given GTR’s contract was still in its early phase having been
awarded in 2022.

The government declined to say if it had varied the terms of any other rail
contract. But in a statement it said GTR’s performance had improved over
the past year. “Performance should be assessed through targets that are
achievable and incentivise operators to deliver concrete improvements that
benefit passengers,” it added.

Labour has vowed to nationalise the railway system if it wins this year’s
general election by bringing operators into public ownership as contracts
expire.

It has indicated there would be no role for private companies running
trains under the new system. But industry executives have pushed back and
urged Labour to reconsider, pointing to a significant rise in passengers
between the privatisation of the industry by the then Conservative
government in the early 1990s and the coronavirus pandemic.

I suspect this is intended to stitch up the next government after the
general election more than anything else.

On 10/02/2024 02:01, Coffee wrote:
> I suspect this is intended to stitch up the next government after the general election more than anything else.

Well we haven't seen any of the party manifestos yet, of course, but the Labour Party seem likely to win and have previously said they want to renationalise the railways, but only by doing it gradually as the existing contracts expire over a period of several years. The problem with this is that the existing rail companies, knowing that they will not be granted a renewal however well or badly they perform, will clearly have an incentive to grab what profits they can while running the assets into the ground.

Some of us think they are doing that already in which case not much will change, but its hard to be sure how much worse they could get at running the railways if they actually had an incentive to do just that.

In my opinion it would be cleaner and simpler if they said that they would nationalise the whole lot in one go *without* any compensation. Provided they announced this ahead of the election the shareholders of the companies could hardly complain of unfairness, as it would be up to the electorate whether to support this move or not.

--
Clive Page

On 10/02/2024 15:39, Clive Page wrote:

> In my opinion it would be cleaner and simpler if they said that they
> would nationalise the whole lot in one go *without* any compensation.
> Provided they announced this ahead of the election the shareholders of
> the companies could hardly complain of unfairness, as it would be up to
> the electorate whether to support this move or not.
>

Errr, you are surely not suggesting that a political party be honest are
you?

--
Colin

Clive Page <usenet@page2.eu> wrote:
> On 10/02/2024 02:01, Coffee wrote:
>> I suspect this is intended to stitch up the next government after the
>> general election more than anything else.
>
> Well we haven't seen any of the party manifestos yet, of course, but the
> Labour Party seem likely to win and have previously said they want to
> renationalise the railways, but only by doing it gradually as the
> existing contracts expire over a period of several years. The problem
> with this is that the existing rail companies, knowing that they will not
> be granted a renewal however well or badly they perform, will clearly
> have an incentive to grab what profits they can while running the assets into the ground.
>
> Some of us think they are doing that already in which case not much will
> change, but its hard to be sure how much worse they could get at running
> the railways if they actually had an incentive to do just that.
>
> In my opinion it would be cleaner and simpler if they said that they
> would nationalise the whole lot in one go *without* any compensation.
> Provided they announced this ahead of the election the shareholders of
> the companies could hardly complain of unfairness, as it would be up to
> the electorate whether to support this move or not.
>

Beware of unintended consequences of expropriation. It could have terrible
consequences for other industries and services.

On 10/02/2024 15:39, Clive Page wrote:
> On 10/02/2024 02:01, Coffee wrote:
>> I suspect this is intended to stitch up the next government after the
>> general election more than anything else.
>
> Well we haven't seen any of the party manifestos yet, of course, but the
> Labour Party seem likely to win and have previously said they want to
> renationalise the railways, but only by doing it gradually as the
> existing contracts expire over a period of several years.   The problem
> with this is that the existing rail companies, knowing that they will
> not be granted a renewal however well or badly they perform, will
> clearly have an incentive to grab what profits they can while running
> the assets into the ground.
>
> Some of us think they are doing that already in which case not much will
> change, but its hard to be sure how much worse they could get at running
> the railways if they actually had an incentive to do just that.
>
> In my opinion it would be cleaner and simpler if they said that they
> would nationalise the whole lot in one go *without* any compensation.
> Provided they announced this ahead of the election the shareholders of
> the companies could hardly complain of unfairness, as it would be up to
> the electorate whether to support this move or not.
>

Given the railways are already nationalised, I am not sure what labour
is talking about. I suspect, that as last time they were in this
position, once in power it will be quietly forgotten as too complicated,
expensive and time consuming when they will have many much more
important problems to worry about.

--
Graeme Wall
This account not read.

Graeme Wall <rail@greywall.demon.co.uk> wrote:
> On 10/02/2024 15:39, Clive Page wrote:
>> On 10/02/2024 02:01, Coffee wrote:
>>> I suspect this is intended to stitch up the next government after the
>>> general election more than anything else.
>>
>> Well we haven't seen any of the party manifestos yet, of course, but the
>> Labour Party seem likely to win and have previously said they want to
>> renationalise the railways, but only by doing it gradually as the
>> existing contracts expire over a period of several years.   The problem
>> with this is that the existing rail companies, knowing that they will
>> not be granted a renewal however well or badly they perform, will
>> clearly have an incentive to grab what profits they can while running
>> the assets into the ground.
>>
>> Some of us think they are doing that already in which case not much will
>> change, but its hard to be sure how much worse they could get at running
>> the railways if they actually had an incentive to do just that.
>>
>> In my opinion it would be cleaner and simpler if they said that they
>> would nationalise the whole lot in one go *without* any compensation.
>> Provided they announced this ahead of the election the shareholders of
>> the companies could hardly complain of unfairness, as it would be up to
>> the electorate whether to support this move or not.
>>
>
> Given the railways are already nationalised, I am not sure what labour
> is talking about. I suspect, that as last time they were in this
> position, once in power it will be quietly forgotten as too complicated,
> expensive and time consuming when they will have many much more
> important problems to worry about.
>

Whenever a Labour spokesperson is questioned on this topic, they seem not
to understand that the passenger railway is already nationalised.
Cancelling the operating contracts would save almost nothing, and might
even be more expensive, depending on what they (mostly foreign
government-owned rail operators) win in the subsequent legal actions
against the UK government.

On 10/02/2024 19:06, Recliner wrote:
> Graeme Wall <rail@greywall.demon.co.uk> wrote:
>> On 10/02/2024 15:39, Clive Page wrote:
>>> On 10/02/2024 02:01, Coffee wrote:
>>>> I suspect this is intended to stitch up the next government after the
>>>> general election more than anything else.
>>>
>>> Well we haven't seen any of the party manifestos yet, of course, but the
>>> Labour Party seem likely to win and have previously said they want to
>>> renationalise the railways, but only by doing it gradually as the
>>> existing contracts expire over a period of several years.   The problem
>>> with this is that the existing rail companies, knowing that they will
>>> not be granted a renewal however well or badly they perform, will
>>> clearly have an incentive to grab what profits they can while running
>>> the assets into the ground.
>>>
>>> Some of us think they are doing that already in which case not much will
>>> change, but its hard to be sure how much worse they could get at running
>>> the railways if they actually had an incentive to do just that.
>>>
>>> In my opinion it would be cleaner and simpler if they said that they
>>> would nationalise the whole lot in one go *without* any compensation.
>>> Provided they announced this ahead of the election the shareholders of
>>> the companies could hardly complain of unfairness, as it would be up to
>>> the electorate whether to support this move or not.
>>>
>>
>> Given the railways are already nationalised, I am not sure what labour
>> is talking about. I suspect, that as last time they were in this
>> position, once in power it will be quietly forgotten as too complicated,
>> expensive and time consuming when they will have many much more
>> important problems to worry about.
>>
>
> Whenever a Labour spokesperson is questioned on this topic, they seem not
> to understand that the passenger railway is already nationalised.
> Cancelling the operating contracts would save almost nothing, and might
> even be more expensive, depending on what they (mostly foreign
> government-owned rail operators) win in the subsequent legal actions
> against the UK government.
>

I've a sneaking suspicion it's just to shut the union leaders up.

--
Graeme Wall
This account not read.