New operators to launch long-distance rail routes

The rail industry has revealed proposals for new operators to develop long-distance train services, including routes to both west and north Wales.

Open access services on seven routes are being developed in a bid to boost connectivity, increase competition and reduce fares, analysis by the PA news agency found.

And the UK Government is planning measures to encourage further proposals, despite concerns that open access services create additional strain on the network and take too much revenue away from conventional operators.

The vast majority of trains in Britain are run by operators either owned or paid management fees by the UK, Scottish or Welsh governments.

In contrast, open access operators set their own fares, take on all revenue risk and receive no taxpayer-funded subsidies.

Benefit to passengers

In deciding whether to approve new open access applications, regulator the Office of Rail and Road assesses factors such as the benefit to passengers, whether sufficient new revenue will be generated, and the impact on the punctuality of existing services.

Rail minister Huw Merriman said the UK Government was working to provide more certainty over the duration of the application assessments, reconsidering the required balance of costs between taxpayers and operators, and ensuring all unused track access slots were made available.

He told PA that open access services “give more choice to customers, and that crucially increases the number of passengers that we get”.

He went on: “It’s not just a question of us having rail operators compete with each other.

“There’s an opportunity for rail to take passengers that may otherwise fly or indeed drive.

“Open access is such a positive.

“It doesn’t involve any direct taxpayer subsidies.

“It also breaths new life in terms of working practices.

“There’s no industrial action on open access operators, perhaps because it’s a fresher way of working with the workforce rather than on an old rule book basis.”

The railways have been repeatedly hit by industrial action in recent years, with a dispute involving members of train drivers’ union Aslef ongoing.

Carmarthen

York-based prospective open access company Grand Union Trains (GUT) has been given the go-ahead to run trains between London Paddington and Carmarthen, and is consulting on starting services between Edinburgh and Cardiff.

It also plans to launch services between London Euston and the city of Stirling in central Scotland from June next year.

Managing director Ian Yeowart said the growth in passenger numbers on the East Coast Main Line between London King’s Cross and Edinburgh demonstrated the “significant benefits” of open access.

Services on the line are run by Government-owned LNER and open access operators Grand Central, Hull Trains and Lumo.

Mr Yeowart, who founded Grand Central in 1999, said: “There’s sufficient evidence now, particularly on the East Coast Main Line, to say ‘what’s not to like?’ (about open access).

“It’s not only good for passengers – as whether (the operators) survive depends on how good they are and what their customers think – but there are no handouts from the Government.

“Like every other business, if people don’t like it and don’t come, it won’t survive.”

Mr Yeowart added that open access provided “services to destinations long forgotten”.

Other current proposals for new open access routes are:

– Services between London King’s Cross and Sheffield by FirstGroup.

– Services between London Euston and Wrexham by Alstom.

– Go-Op running services between Taunton and both Weston-super-Mare and Swindon.

– Lumo extending its London King’s Cross-Edinburgh route to and from Glasgow.

Fare reductions

New open access operators competing on the same routes as incumbents typically offer fare reductions of 20-60% in the long-term, according to a report published in summer 2023 by Rail Partners, a body representing private sector train companies.

But rail engineer Gareth Dennis believes open access services should not be permitted in Britain because it is “incredibly complicated” to fit them in among trains run by operators with Government contracts, and can “actually reduce overall capacity”.

He said: “The argument on the Continent for open access operators is that they provide competition, but there’s no meaningful competition on a rail network that’s as saturated as ours.

“What you need is a simple, repetitive timetable that moves huge numbers of people.”

Mr Dennis said open access operators often charged lower fares because “they don’t have any of the overheads that the rest of the railway has”.

He went on: “They don’t have to pay for depot space because they get to use depots that exist for other companies.

“They don’t have to pay to train their staff because they can just recruit staff trained by the other operators.

“It’s a false economy really.”

He added: “The number of people who benefit from Lumo’s cheap tickets is very, very small compared to the overall picture on the rail network.”

Concerns

Railway historian Christian Wolmar also expressed concerns about open access operations.

He said: “It’s only good news if the railways don’t end up costing a lot more because these new operators have made it more difficult for the main operators to run services.

“If they’re adding a few new destinations, can they afford to do that without abstracting revenue from a lot of existing operators and therefore pushing up fares?

“I think they could push up fares for everybody at the cost of providing a few new services.”