Should Network Rail be disbanded and the infrastructure given over to the Toc's

[Old Timer]

So it is said, but no one really ever explains why, other than with a mixture of nostalgia and dissatisfaction with present arrangements. The fact is that any business model can work - you could make track the responsibility of local primary schools if you wanted - so long as the responsibilities, relationships, regulations and interfaces are clearly defined and legally implemented. .

The wheel/rail interface is dynamic and both are reliant upon one another.

The present system is far from being fine by any standards, and is only popular with those who do not have to manage within the vagaries of the system, by those who hold some nostalgic view for BR and those who have a naive political view that somehow we are almost back to a form of BR.

The cost of even the simplest renewals is driven up to astroniomic proportions by the insistence of Network Rail micro-managing everything. This is made worse by some of the most appalling tenders and contracts you would ever wish to see, which are so woolly and badly written that the result is that even NR Procurement and Contracts staff do not understand what the Contract actually is - how therefore is the Contractor to perform properly ?.

Most issued Tenders are in no way representative of the actual work to be carried out, and Contract award processes are biased towards headline price rather than taking a more inclusive view of competence and quality, that is why so many small Companies and labour agencies are doing so well. Anyone can take a man and put him through a training course (which he of course pays for) and demonstrate "competence". What they cannot do is to demonstrate experience and knowledge, and this is seen when things start to go wrong.

I have heard a tale about one small Contractor who used NR approved labour agency staff to carry out a track renewal and physically forced the pandrol clips into the housings not realising that the new rail was UIC 60 rather 113lb - and worst of all they handed the track back. When the person who told me the story later challenged this pointing out that NR had supplied the wrong sleepers, he was threatened with removal from the job and being blacklisted by the Company.

The NR representative themselves were unable to identify that the wrong sleepers had been used.

Next lets look at rolling stock approvals. This process is an absolute joke, it is costly and smacks very much of the not invented here syndrome. The outcome is that it costs a fortune for anyone to introduce new rolling stock, and the transfer of rolling stock between lines is similarly impeded.

People here suggest that private companies would reduce maintenance to an absolute minimum. Well they need to open their eyes, read a few RAIB Reports and go and do some checking to find that NR have reduced maintenance staff numbers to save money and have reduced maintenance levels for the same reason. Based on track quality and normalised it now costs more for NR to maintain the track at a lower Standard than under the previous Railtrack system. Cost reductions have been spun as arising from the removal of Contractors but in actual fact were and are achieved by reductions in maintenance, the extension of renewals periods and the cancellation of renewals works. Cost savings are also being made by forcing the major Infrastructure Contractors to continue with extended recertification training courses at approved centres which can take 1, 2 or 3 days whilst at the same time allowing their own staff to be re-certified during a cup of coffee and a chat.

The use of Contractors has not reduced, in fact it has increased as former employed staff have been replaced by cheaper labour agencies. These make the men pay for their own training courses and give them the cheapest of the cheap PPE. In most cases they also have to pay the costs of the tools they use.

Other arguments are about safety which are so naive as to not even justify a response.

Lets now look at track access. Why is it cheaper for DBS to operate practically all their freight using diesels even when it is hauled completely under the wires ?

The track maintenance current regime is stilted towards performance over safety, and the perverse incentive that recompenses TOCs/FOCs for route closures even when there will be no affect on train services. In a properly vertically integrated system this would be sorted out between the Engineers and the Operations department, and I have given examples of this perverseness many times on here before.

I have now worked under BR, under Railtrack, under Network Rail, on systems fully franchised out (ops and engineering), and on systems which are fully privately owned and operated, some of which have shared running and exchange arrangements with other Companies and some which operate passenger services as well. Taking all of this experience, it is clear to me that the only way to get things to some form of normality is the vertical integration model which has no State inteference, other than for the setting of strategy, and the overview and enforcement of safety standards.

Arguments about Companies not working together are ridiculous, one only has to look at North America for example where trains run with traction units from various Railroads, and Railroads have all sorts of co-operation even to the extent of providing diversionary routes, traction (if necessary) and traincrew.

There are various groupings where common train operation standards and research is carried out, and where track, and signalling standards are co-ordinated.

Similar but slightly different arrangements apply in South America, and those who travel to Europe will be well aware of the inter-Country trains and freight services that operate without problems.

 

[Oswyntail]

What you describe is a dysfunctional system, but not necessarily unworkable one. Having companies focused on core competencies also makes sense, so long as the framework is done properly. To date, however, there is no evidence that any of the parties have any will to do things properly - and that includes the advocates of the various reform options. First, sit down and work out what are the real priorities for the rail system - what is the system for. Then (fifty years later when that is settled) start putting a functional system together

 

[Old Timer]

What you describe is a dysfunctional system, but not necessarily unworkable one. Having companies focused on core competencies also makes sense, so long as the framework is done properly. To date, however, there is no evidence that any of the parties have any will to do things properly - and that includes the advocates of the various reform options. First, sit down and work out what are the real priorities for the rail system - what is the system for. Then (fifty years later when that is settled) start putting a functional system together

The solution to what is described, is a vertically integrated railway where the operator has responsibility for managing all of the interfaces, free from other issues.

What we have now is like having separate Companies set up to operate as Marks & Spencer or one of the Supermarkets, which all the internal functions being hived off to separate Companies, so that the checkouts are operated by one, the shelf stacking by another, all overseen by a bloated shop management.

 

[Oswyntail]

The solution to what is described, is a vertically integrated railway where the operator has responsibility for managing all of the interfaces, free from other issues.

What we have now is like having separate Companies set up to operate as Marks & Spencer or one of the Supermarkets, which all the internal functions being hived off to separate Companies, so that the checkouts are operated by one, the shelf stacking by another, all overseen by a bloated shop management.

That is one solution, but no one has apparently done a full analysis - or at least one that has been put in the public domain. Your analogy does paint an extreme picture, but outsourcing of specialised functions does work more often than not. NR is (or should be) a heavy engineering enterprise, and the management focus required is a world away from the public focus of the TOCs, simple service providers; the ROSCOs are leasing companies, with yet another focus. It is unlikely that the most efficient way to handle these disparate businesses is to merge them.

 

[Trog]

What you describe is a dysfunctional system, but not necessarily unworkable one. Having companies focused on core competencies also makes sense, so long as the framework is done properly. To date, however, there is no evidence that any of the parties have any will to do things properly - and that includes the advocates of the various reform options. First, sit down and work out what are the real priorities for the rail system - what is the system for. Then (fifty years later when that is settled) start putting a functional system together

The reason it is described as dysfunctional is that it is.

The current set up is too complicated, and too many of the relationships are set up in a way that rewards perverse behaviours. Every boarder between units has a duplication of staff each checking. That the other side is doing what it is supposed to do and not ripping off the other. The multitude of separate bodies also complicates planning, as there are so many more groups to consult. A nightmare in an industry where there is often a need to react quickly to a crisis.

The constant churn of reorganisations, different TOCs and contract areas. Tends to keep resetting the clock to zero, so if experience teaches two groups that they can both save some money by co-operating. They will soon be separated, and the lesson and trust will need learning all over again.

Yes British Rail was a clumsy dinosaur of an organisation, but in some ways that was a strength in that it gave stability. In that everyone knew who was responsible for what. You could also do things at a local level without interference from on high. Because if you kept it under the radar, head office would never find out.

As everything belonged to one organisation there was no incentive to try and gouge each other. Rather wise old heads generally at a senior supervisor lower management level. Would get together, and a compromise would be agreed with the different departments trading off their skills and needs. So the operating would do the P-Way a favour, which saved them a bit of time. Allowing the block to start a little later, often just after the passage of a train the operating were keen to run. The OHL on call staff would do the isolation, and in return the P-Way would make sure that a tree that was getting near their wires suffered a sudden check to its growth. It took years to build up the contacts and reputation that allowed you to really get things done. But as it was all undocumented and on trust, with no legions of office staff record keeping and checking up it was cheap.

Putting BR back together again is not possible as there is no longer the right mix of people in the industry to do it, and the modern legal situation demands that someone signs for and documents everything.

But having fewer interfaces between different groups, so that more of the benefits and problems caused by doing something were contained within one financial unit, and more stability to encourage the building of relationships of mutual benefit would still be a great improvement.

 

[Oswyntail]

The reason it is described as dysfunctional is that it is.....

Agreed. But is the dysfunctionality inherent in the model, or in the appallingly sloppy way in which the legal (and hence operational)interfaces were constructed? There are pros and cons for each model, but I do not believe that the upheaval of moving to vertical integration would produce benefits to justify it. It feels to me like the typical MBA approach of reorganisation to avoid looking at problems rather than addressing them

 

[Old Timer]

Agreed. But is the dysfunctionality inherent in the model, or in the appallingly sloppy way in which the legal (and hence operational)interfaces were constructed? There are pros and cons for each model, but I do not believe that the upheaval of moving to vertical integration would produce benefits to justify it. It feels to me like the typical MBA approach of reorganisation to avoid looking at problems rather than addressing them

Trog has quite eloquently given some practical examples of how things used to be under BR, which was a vertically integrated organisation as I know you will agree.

Within avertically integrated organisation that is mature, there will always be a common goal. Within BR it was to provide a public service and keep the trains running if at all possible using whatever means and methods were necessary. I think it is fair to say that al of us BR people were brought up with that ethos and that for several years, in fact still in some cases, it was difficult for us to extract ourselves from that modus operandi.

This was reinforced to a very large degree in that all that really happened in April 1994 was that the name on the letter heads and on the vans/PPE changed. Everybody that had previously worked for BR simply had a new Company name.

Established relationships continued, and this was enhanced by the "hands off" I am the client approach taken by Railtrack in that they awarded the Contracts and then let the Infrastructure Maintenance/Renewals Contractor get on with the delivery.

Because both these organisations were again from within the same area, apart from some initial teething problems, co-operation on a very wide scale, irrespective of the Company name on the clothes, continued between the Maintenance and Renewals Contractors, even when they were not the same Companies. It is perhaps a unique Railway experience, that the two (maintenance/renewals) are not very closely aligned, let me give you an example or two.

I have been in renewals/new works all of my Infrastructure time. I look at a piece of bad track and think of solutions to remove the cause of the problem. The maintenance engineer alongside me looks at the track and works out how to keep it in as safe condition as long as he can, in other words the underlying role of the maintainer is to manage the steady dilapidation of the track infrastructure in a controlled manner. These are skills in many ways that are separate and specialised, although that is not to say that a person cannot transfer from one to the other. I have known people do so, but maintenance people have found it a difficult transition. I for one do not have the skills to manage maintenace and to be honest I am not at all convinced I would enjoy it. Maintainers I have spoken to love the fault finding and the ingenuity of making repairs, and would find renewals/new works boring.

Added to this was the fact that the Renewals Contractor had access to equipment which the maintainer could really only dream about in many cases, for example tampers, heavy plant, etc and the experience and skills involved in managing that.

There was therefore a joint dependency that developed to a much greater extent under Railtrack, in that both the Maintenance and Renewals Contractors had to work with one-another to get the best joint outcome. In that way "favours" would be passed back and forth - for example we would just happen to tamp out a bad spot if it was within a renewals Possession, drop off "spare" rail, offcuts, etc. Sometimes were were able to lend our plant to the maintainer so that he could do a wet spot dig out. When we worked together it was pure heaven, when however there was a breakdown or no relationship between both parties (and this happened even when the units were from the same Company or joint venture) things could get very unpleasant indeed.

Over time however as newer people came into the Industry or experienced Manager were replaced by non-Railway people, matters started to take a different course, a more polarised course where costs were now being talked of, and new Contracts Managers from outside the Industry came in and tried to operate as they had in their previous Industries despite the fact that the Railway is actually a dynamic industry in that everyone has a role leading to a common end and everyone has to work together if that is to be achieved seemlessly and efficiently. The TOCs/FOCs rely upon the Engineering function to maintain the Railway in a safe state suitable for their operation, we rely on the TOCs/FOCs to let us get the access we need for the duration we need and at the times we need to get access in order to keep the Railway safe. All of us depend upon the commercial and on-train staff to sell the tickets and maximise the revenue so that (a) I can have a job, and (b) the Industry has enough money to allow us to keep the track in a good state of repair and improve when and where we can.

Hatfield and Potters Bar really demonstrated that the way Railtrack was being "managed" Politically was not conducive to the interests of the Railway. However rather than modify what was there, the Government for a mix of idealogical, Political expediency, Trade Union pressure (again from a idealogical basis) and financial pressure from the Treasury chose to go down the route we now have, where Ministers and Civil Servants get to play trains without responsibility and the responsibility has been passed to an organisation that is neithere private nor Governmental. In other words we have the worst of all solutions.

Interfaces are managed through Contracts, which are written and managed by in most cases, non-Railway people, there was until recently greater and greater Centralisation, there is a burgoning (and wholly unnecessary) Projects division, which is getting bigger and bigger yet only exists to simply man-mark and micro-manage the Contractors, and into this mix we now have Bechtel.

Contracts are now awarded from the centre under hub and spoke arrangements, which may work fine for factories and assembly lines but certainly do not work in the Railway. Hub and spoke Contractors are not permitted to speak with one-another directly but must speak through the respective NR representatives thus increasing the costs and the duration.

No Contractor is oermitted to speak with the TOCs/FOCs and all orders for materials and train haulage now have to go through another units called National Delivery Services (or whatever name this goes under this week), again implementing yet another tier (quite separate from the Projects team - if this is what they are known by this month ?) and again extra cost.

The result of all of this has been to dramatically drive up Renewals costs, not because the Contractor's are expensive - we have seen REAL prices fall dramatically in the past three years to the point that they are almost unsustainable (which is what NR wants anyway) - but because the costs of all these internal NR organisations and units which man-mark and double/treble up on everything have to be paid for. NR of course continues to spin the story that the Contractors are expensive whilst at the same time they are increasing and indeed introducing even more tiers of management by bringing in Project Managers from outside to manage their own internal Project managers, who in turn are micro-managing the Contractors management team.

This was one of the reasons that I left to work overseas.

I am sorry to go on at length but to suggest that the current system will work flies in the face of the experience of both Trog and myself. It does not, it never will work and it should be humanely put to sleep as soon as possible.

The former BR model worked because it was vertically integrated. BR cannot be brought back because you now have a management with a completely different ethos and agenda. I my opinion, the only way out of this horrendous mess is to vertically integrate as quickly as possible and take away the running of the Railway from the Civil Service and Government Ministers.

Airline operations are far removed and as good as an example of a vertically integrated Industry (yes I know the airports and ATC are separate) which has little interference from Ministers, even when things go wrong. We did not see calls for Ministerial resignations when the BA777 crashed at Heathrow, now do we see public inquiries demanded, yet BA and many other Airlines are privately owned and operated.

Insofar as safety is concerned, everyone in the Airline Industry accepts that Ryanair, for all its perceived and actual customer service issues - mostly because people want to pay for a mini yet expect a rolls royce - has one of the highest maintenance standards in the Industry. There is no correlation between public ownership/management and safety. You only have to look a Air France and compare them to BA for example to see who has the poorer safety record.