Shadow Strategic Rail Authority

Rail passenger partnership outcome of consultation exercise August 1999
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date 23 August 1999
source Shadow Strategic Rail Authority
type Press release

Following issues raised during the seminars preceding the launch of RPP, the Shadow Strategic Rail Authority (SSRA) invited consultation from interested parties seeking views on the terms on which RPP funding is awarded and the processes associated with the award.

Key issues were: what consultation SSRA and sponsors of proposals should undertake before RPP funds are committed, the impact of services supported with RPP funds on existing franchise services, and the role of competitive tendering in the award of RPP funding. The exercise was closed on 28 June.

The outcome of the exercise and SSRA's recommendations are presented below:

1.Overall, the range of consultees to be approached on individual proposals and the list of topics identified in the consultation document were supported by those who responded to the consultation paper.
2.Consultees support SSRA's position not to become directly involved in establishing the availability of access rights, but suggest that SSRA could facilitate the process by reminding sponsors of the processes and timescale involved, and making it clear to Railtrack that it should co-operate with the sponsors and quote reasonable prices in a timely fashion.
3.No overall consensus emerged from the exercise on the treatment of abstraction of revenue from franchised TOCs. With the exception of Anglia, other train operating companies (TOCs) who responded to the paper argued that operators adversely affected by a RPP proposal should be entitled to either compensation or passenger service requirement (PSR) reduction. Unlike TOCs, most Passenger Transport Executives (PTEs), and other public bodies argued against payment of compensation to the affected parties, on the grounds that it will not be a good use of public money. Some of the TOCs and PTEs suggested that RPP should not be used to support services which compete directly with franchised operators. Some consultees suggested that abstracted revenue should be excluded from the appraisal of net benefits of a project but, if the project went ahead, compensation should not be paid.
4.The response on the issue of competitive tendering is also varied. Most operators argued against competitive tendering on the grounds that it would deter TOCs from developing innovative proposals, and that, at best, it will have a marginal impact on improving cost efficiency. On the other hand, PTEs, Association of Transport Co-ordinating Officers (ATCO) and Government Offices, on balance, are content with SSRA 's position that competitive tendering should be pursued where possible, but feel that there should be some recognition of the work done by the promoters in developing any scheme. It is also suggested that SSRA should consider establishing a de-minimis limit below which services could be awarded to an incumbent operator without the need to go to tender.
Conclusions

On this basis, our conclusions on the four issues identified in the consultation document are as follows:

i.Scope & process of consultation:
SSRA will proceed with the scope and process suggested in the consultation paper; but
where appropriate, SSRA will consult freight operators on specific proposals; and
will include Railtrack in the consultation process.
i.Network capacity:
generally, SSRA will not become directly involved in establishing the availability of access rights; but
in certain instances the SSRA will play a more active role to facilitate the process and address the strategic concerns.
i.Abstraction:
SSRA will take account of abstraction in project appraisal;
SSRA will not pay compensation; but
we will consider any appropriate changes to the PSR to mitigate the effect of abstraction on TOCs adversely affected by a RPP scheme;
consultation on proposals will seek to establish early on whether operators believe they would be subject to abstraction.
i.Competitive tendering
when SSRA considers the service could potentially be provided by more than one TOC, SSRA will reserve the right to invite competitive tenders from relevant parties; but
we will allow the operator who developed the scheme in the first place, if unsuccessful in the competition process, to match the winning bid; and
where appropriate, we will consider giving preferred bidder status.
If you require any further information on the above, please contact Hadi Zamani or Margaret O'Brien.

List of Consultees

PROVISION OF RAIL PASSENGER PARTNERSHIP FUNDING FOR NEW SERVICES

CONSULTATION EXERCISE

Association of Transport Co-ordinating Officers
Central Rail Users Consultative Committee
Convention of Scottish Local Authorities
Central Rail Users Consultative Committee
Franchise train operators
Freight operators
Government Offices
Local Government Association
London Regional Passengers Committee
London Transport
Office of the Rail Regulator
Passenger Transport Executives
Railtrack
Scottish Office
Welsh Office
SSRA

August 1999

Railhub Archive ::: 1999-08-23 SRA-001