Wales to take train operations into public ownership

The Welsh Government has moved to take train services in the Principality into public ownership, although it will retain its close relationship with Keolis and Amey.

In England, the Department for Transport has ended rail franchising, replacing it with Emergency Recovery Management Agreements (ERMAs) with the various train operators – management contracts with tough performance targets and reduced management fees.

Now Ken Skates MS, Minister for Economy, Transport and North Wales in the Welsh Government, has acknowledged that, both during the current COVID-19 pandemic and afterwards, there will be some stark economic challenges for the rail sector, not just in Wales, but across the whole of the UK.

He is therefore intending to work with Transport for Wales (TfW), Keolis and Amey to provide the most stable platform possible from which to build back from the crisis, whilst continuing to deliver on the Welsh Government’s vision for the future of public transport in Wales.

Ministerial statement

In a written statement to the Welsh Parliament (Senedd), the Minister said: “A stable platform for building back better is dependent on the right delivery model, suitable for a post-Covid environment and I am pleased to inform members that Transport for Wales have agreed the principles of a new publicly owned model, which will allow them to continue to put customers and communities at the heart of everything they do, with safety as their first priority.

“I have approved the basis of a new relationship between Transport for Wales, Keolis and Amey which will be made up of three key components:

• From February 2021, the delivery of day-to-day rail services will be the responsibility of a new publicly-owned subsidiary of Transport for Wales, allowing government to have an even greater role in the delivery of rail services in Wales and the borders, reflective of the new commercial realities of the post COVID-19 environment. With huge uncertainty over passenger revenue, this provides us with the most stable financial base to manage rail services as we emerge from the pandemic.
• Infrastructure management and transformation of the Welsh Government-owned Core Valley Lines will continue to be delivered under the current contract. This will provide stability for the programme to ensure effective delivery of the south Wales Metro transformation work which is already underway.
• A new partnership with Keolis and Amey, led by Transport for Wales, will be developed, which will allow the people of Wales to continue to draw on the international experience and expertise of these partners to help TfW to deliver important commitments such as integrated ticketing, on demand transport systems, cross modal design and delivery, in addition to the ongoing integration of light and heavy rail.

“This model will continue to help deliver our vision for a high-quality rail service through effective vertical integration of track and train, building on the work already achieved through the transfer of the central Valleys Lines earlier this year.”

Ken Skates was at pains to point out that Wales’ major rail projects will still go ahead. “The delivery of key commitments, such as the creation of the Metro, the delivery of brand-new rolling stock for the Wales and Borders rail network and other improvements remain a priority for Transport for Wales and partners,” he stated. “This is in spite of the challenges we are currently facing as a result of the coronavirus pandemic. Transport for Wales continue to work closely with all partners and their supply chain to ensure they deliver our plans and services with safety as the top priority.”

Industry response

The two main players were supportive of the government’s plans. James Price, chief executive of Transport for Wales, commented: “I’m pleased with this agreement, which will allow Transport for Wales to continue to deliver the transformation of the Wales and Borders rail network over what’s an incredibly difficult period for the industry, with a huge reduction in passenger journeys and revenue.

“KeolisAmey have made a significant contribution to transport in Wales over the past two years and I’ve welcomed their collaborative approach to securing this agreement, which has allowed us to achieve a positive way forward for the Wales and Borders contract . 

“We will continue to benefit from the international industry expertise of both Keolis and Amey whilst giving TfW and Welsh Government more control to deliver our key transport objectives, as we look to sustain the good progress of the rail network and ensure it plays a vital role in helping Wales to be well-placed in a post pandemic environment.”

“There is no doubt that there will be difficult decisions in the future as we adapt to the realities of a post-covid era, but this agreement will give us a stable base from which to build back better.”

Kevin Thomas, chief executive of KeolisAmey Wales, operator and development partner of Transport for Wales, added: “Our partnership with TfW will always have the passengers and the communities we serve at its heart – finding the right solutions to improve services across Wales and the border areas.

“In light of COVID-19, we recognise the need for Welsh Government to have a sustainable way forward for delivering its ambitious objectives for rail and we are pleased to have agreed and put in place robust principles as we work on the details of a new agreement.

 “A huge amount has been achieved in the two years since KeolisAmey became operators of the Wales and Borders franchise. Prior to the impact of COVID-19, the network had more trains running more frequently than ever before, with progressive improvements in performance and passenger experience.

“We have successfully managed the introduction of more modern and reliable trains across the network and delivered the groundwork for the introduction of new trains from 2021/22 – exclusively for Wales and supporting further service frequency improvements across vital commuter routes.

“An important result of these major achievements has been the creation of sustainable jobs, skills and apprenticeships, in support of the people and economy of Wales.

“Keolis and Amey are determined to see improvements delivered, and to play a significant role in the transformation vision, adding value through our international experience and expertise. We also recognise this as an exciting opportunity to demonstrate the additional skills we can bring to wider public transport projects across Wales in the coming years.

“We’re committed to our partnership with TfW and the next phase of this exciting transformation journey that will improve transport, connect communities and support prosperity.”

So, it seems that, although the day-to-day operation of the train service will be in the hands of Transport for Wales, track maintenance will still carried out by a combination of Network Rail and KeolisAmey, and both Keolis and Amey will provide their expertise to improve the running of Wales’ railway.

Trade-union view

The two main unions welcomed the announcement that operations will be taken into public hands but would like the both the Welsh and English Governments to go further.

RMT general secretary Mick Cash said: “RMT welcomes this decision by the Welsh Government and believes this is the best way to protect rail services in Wales. We will also be seeking urgent assurances that railway workers jobs and conditions will be fully protected and the railway will be properly funded.

“RMT is also seeking reassurance that rail infrastructure maintenance will also continue to be provided by the public sector as it was under Network Rail.

“There is huge public support for public ownership because privatisation and profiteering has never been an efficient way to provide value for money, and this is even more the case when extra funding has been needed during the Coronavirus pandemic.  

“So, as well as supporting this decision, we are calling on the UK Government to give the Welsh Government the necessary powers and support to ensure the railways in Wales have a  safe, secure and sustainable future in public ownership.”

Manuel Cortes of the TSSA echoed the RMT’s stance, stating: “This is a welcome and positive step from the Welsh Government, which will put our railways back in public hands and again shows the abject failure of privatisation.

“Frankly, the game is up for the failed franchising model and it’s now time to re-name the Operator of Last Resort – the Operator of First Choice.

“What this terrible pandemic has shown is our railways are vital to the wellbeing of all our citizens. Keeping trains running has ensured our frontline NHS workers get to work and save lives, while also allowing medical supplies, food and other essential goods to be transported.

“It was regrettable that Welsh Ministers chose to privatise ten per cent of Wales’ infrastructure earlier this year. Frankly, there can be no short cuts when it comes to maintenance and we will continue to fight for this to also be in public hands.

“Our union will now be looking for an early meeting with TfW to discuss how the new arrangements will work in practice. Ministers must honour existing terms and conditions of all staff and their trade union recognition rights. We trust that they will also work with us on maintaining the travel facilities our members now enjoy.”