2016 Report details for project: Rail Franchising Programme

Project name: Rail Franchising Programme - there are 5 reports for this project: 2015, 2016, 2017, 2018, 2019
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Organisation: DFT (D9) - see all reports for this organisation
Report year: 2016 (data is from Sept 2015)
Category: Infrastructure - see all reports for this category
Description: To secure the provision of passenger rail services as set out under the Railways Act 1993 (as amended) by letting Rail Franchises.
DCA (RAG): Amber
DCA text: The Rail Franchising Programme continues to deliver in line with the published schedule. Since Q2 we have made 3 franchise awards- 1 through Direct Award (West Midlands) and 2 following competition (Northern and TransPennine Express (TPE)). These awards will deliver significant benefits for passengers and higher returns to the exchequer. The Northern and TPE franchises will begin 1 April 2016 and work to mobilise them continues. This includes the formation of the joint Rail North/ DfT commercial management teams in Leeds, which will see a more localised approach to the franchises and is a step toward eventual devolution. The most recent issue of the franchise schedule included a retiming of the InterCity West Coast competition to ensure it is well aligned with the HS2 programme. The ICWC operator will play an important role during the construction of HS2 and in facilitating the introduction of High Speed services in 2026. This retiming will allow us to continue to engage with the market on the best options for the franchise to do this. We have also made changes in the procurement process to introduce a “Passport” approach to prequalification of bidders, which will make the franchise bidding process simpler and reduce the barriers to entry for new entrants to the market. This has been designed to streamline the pre-qualification process for rail franchise competitions. In particular, the Passport System is intended to reduce the time and cost involved for Applicants in providing detailed technical information for multiple rail franchise competitions. A Passport is needed for any organisation to express an interest in any future rail franchise competition. We currently have teams working on 3 live franchise competitions at various stages of completion. West Midlands and South Western are undergoing consultation exercises and developing specifications; East Anglia is currently evaluating bids in preparation for award in the summer. The West Coast team is also in place doing preparatory work to launch the competition later this year. A recent PAC report into the programme confirmed the significant progress we have made in improving franchising and the benefits that it has brought to passengers since the launch of the programme in 2013. It highlighted the need to continue to ensure that the franchise market remains competitive. We are taking active steps to do this by working with OGDs and altering our policies to encourage new entrants to the market.
Start date: 2013-03-26
End date: 2022-12-31
Schedule text: Ministers have agreed to a 6 month retiming to the start of the West Coast ITT to enable DfT to impact assess redevelopment of Euston and HS2 on the West Cost franchise . Key work streams of the Specification work have been brought forward to enable more time to meet the ITT milestones.
Baseline: £0.00m
Forecast: £0.00m
Variance: None%
Variance text: Budget variance less than 5%.
Whole Life Cost: £1,036.30m
WLCost text: Budget values are derived from v15.51 of the rail LTF amended for subsequent CP5 and other changes. Economic factors as most recent OBR projections. Forecast from rail LTF v June 2015. A significant policy change since the Q1 forecast is the change in fares policy for the years of 2015/16 to 2019/20 where the fare increase has been reduced from RPI+1% to RPI+0%. This change increasingly reduces farebox across all years. Lower inflation forecasts will have also reduced farebox although this will be partially offset by lower costs. For all franchises, the franchise duration has been amended to the current duration. Both the budget and forecast values have been amended to this basis.
Notes1: Budget variance less than 5%.
Notes2:
Sourcefile: IPA_2016.csv

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