Single guiding mind
The phrase ‘what would British Rail have done?’ has been heard a number of times in discussions, with an admission that the drive for revenue has added layers of cost and complexity which the industry can no longer afford. There is a consensus that a ‘single guiding mind’ will be required to oversee this transition.
This is expected to come with a drive at the behest of DfT to reduce costs. Industry sources expect this to be borne by all operators and all staff, with one informed source telling Rail Business UK that ‘industrial relations will be the big issue; I think there is a view that everybody in the rail industry, including the management, is overpaid and it is time for reckoning. That will happen in the next few months, and I think it could get quite bloody.’
The source noted that within the current government, which has a large majority and three years to run, there is a desire to remove some of the inflexibilities that remained after privatisation despite an expectation that they would be resolved. Ending rest day working is understood to be a particular ambition for DfT.
Noting that some politicians have suggested that with fewer people using trains now might be the best time to take on the unions and endure a period of industrial unrest, the source commented: ‘I think there is that appetite.’
Owning groups
Industry insiders do, however, note that if labour reforms are part of DfT’s negotiations with owning groups over the NRCs, it may cause some of the overseas groups to consider whether they wish to remain involved in the UK rail sector. ‘I think that this could make one or two owning groups give up rather than do the government’s dirty work’, noted one representative of a TOC parent.
Owning groups have until mid-December to reach agreement with DfT over retaining their contracts, and, in the view of several observers, some may opt not to accept the terms being offered by DfT and the Treasury.
‘This will come to a crunch’, explained one senior insider, ‘and if they don’t complete in December, they will go back on franchise terms and fall over, probably not immediately in some cases, but probably over the next 18 months.’
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