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National rail review June 2009

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National rail reviewJune 2009

Contents

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Network Rail monitorFurther details of Network Rail’s performance are published in the Network Rail monitor. It is a scorecard of high-level key performance indicators (KPIs) together with a commentary.

The Network Rail monitor for quarter 4 2008-09 is at:

http://rail-reg-master.orr.gov.uk/upload/pdf/397.pdf

National rail trendsNational rail trends (NRT) continues as the main official rail statistics publication containing a wide range of data from various sources including network usage and performance.

National rail trends is at:

http://www.rail-reg.gov.uk/server/show/nav.1863

FeedbackWe are keen to receive your feedback on the usefulness, content and format of this publication. Please contact Brian Hatfield on 020 7282 2073 or [email protected] with your comments.

Page 1. Looking back at Control period 3 3 A breakthrough for Britain’s railways? 3 A safer railway 3 A railway that better satisfies its customers 4 A more efficient railway 6 Raising the bar 6

2. Delivering an ever decreasing safety risk 7 Overview 7 Health and safety performance 7 ORR’s strategy and business plan 9

3. Delivering enhancements to the railway 10 Funding 10 Outputs 10 Monitoring delivery 12

4. Focus on passenger needs: our consumer law role 14 Our aims 14 Our approach 15 Our powers 16 What next? 16

National rail review – twelfth edition 3 June 2009

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1. Looking back at Control period 3

A breakthrough for Britain’s railways?

If not quite its darkest hour, the circumstances of the rail industry in 2004 at the start of Control period 3 (CP3) were grim.

The fatal accident at Hatfield in October 2000 had been followed by network-wide train delays on an unprecedented scale for over a year, after Railtrack imposed hundreds of emergency speed restrictions because of lack of confidence in the condition of its track. The public performance measure (PPM) of train service reliability fell to 75% early in 2001 and six years of strong growth in passenger business was thrown, temporarily, into reverse.

Railtrack itself then succumbed to administration and when, in 2002, the network was taken over by Network Rail, one of its first steps was to seek an urgent interim review of its charges by the Rail Regulator. The result, when this was completed in 2003, was a huge increase in expenditure. Operating, maintenance and renewal costs for 2004-05 alone were to be over £5bn,1 two thirds higher than the 2000 access charges review had allowed for Railtrack.

Public confidence in railway safety was understandably shaken by these events, as was the confidence of Government that the railway industry was capable of delivering an acceptable service at an affordable cost. Entering CP3 the stakes were high.

A safer railwayMention railway safety and people will tend to think about train accidents, which do indeed still have the potential to cause significant loss of life and injuries. However, thanks in large part to significant

investment in systems to prevent train collisions (TPWS) and in new rolling stock with higher safety standards, the level of risk to passengers from train accidents2 is now less than half of its March 2002 level - most of that reduction coming during CP3. The greatest single source of train accident risk now comes from misuse of level crossings by pedestrians and motorists, something Network Rail is continuing to address including through publicity campaigns.But train accidents are not the only source of risk. More fatalities and injuries are caused by other factors such as trespass on the railway or slips and falls.

There has been a 33% increase in reported trespass incidents since 2004-05, whilst progress in reducing the risk of slips and falls has been relatively slow, with only a 7% decrease in reported incidents during CP3. Nonetheless there are steps the industry can take and the government has set a target of a further 3% reduction in the overall risk in CP4. 1 In 2002-03 prices

2 Measured by the Rail Safety and Standards Board’s Precursor indicator model

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There were significant improvements in workforce safety during CP3 with minor injuries and serious injuries falling by 46%. The number of fatalities over the same period also fell, even so three employees died in 2008 and it is vital to keep a focus on reducing workforce risk.

A railway which better satisfies its customersSince Passenger Focus began measuring the views of rail passengers in 2004 through its National passenger survey (NPS), the percentage of passengers who are satisfied with their journey overall has risen in stages from 74% to 83%3 (Figure 1). Just 7% of passengers now express dissatisfaction on this overall measure.

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One factor above all driving this change was the significant improvement in train service performance over the period. PPM across the network increased from the low of 75% early in 2001 to reach 90.6% on 31 March this year, the highest level since this measure was introduced in 2000. The NPS measure of passenger satisfaction with punctuality and reliability has increased by more than 10% in five years.

This has been achieved through genuine, sustained collaborative working by train operators and Network Rail, led by the cross-industry National Task Force but implemented through local operator and Network Rail teams across the system. Network Rail reduced delays for which it is held responsible by 36% during CP3. The passenger operators did even better, cutting delays they caused by 45% in the same period.

1. Looking back at Control period 3

3 NPS autumn 2008 survey (the latest results available)

Figure1: Percentage of passengers satisfied 2004-08, by sector

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More, and faster, trains have been introduced on many routes. Passenger train kilometres were 23% higher in Jan 2009 than at the beginning of CP3. The average age of rolling stock fell from nearly 20 years at the start of the decade to below 16 at the end of 2008. Trains

built in the 1960s have been replaced by modern rolling stock with sliding doors and a range of features including air-conditioning, power points for laptops and Wi-fi.

The combination of better services and economic growth has led to an unprecedented rise in passenger demand. The number of passenger journeys increased from 253m in 2004-05 to well over 300m in 2008-09.

Freight users too have benefited from improvements over the period. Reduced delays, increased competition among freight operators and investment in additional capacity such as at Felixstowe container terminal saw the amount of freight moved increasing from 2003-04 to 2006-07, although recently a more difficult economic environment has pegged this back.

However some of these improvements have come at a cost. Planned engineering work to improve the railway now causes far more disruption than in the past, and reducing this is a priority in CP4.

And fares have risen faster. After rising in real terms (compared to the Retail Price Index (RPI) by around 0.6% a year up to 2004, increases averaged RPI+2% in the following years, partly as a result of a change in government policy on regulated fares. There has also been a mixed reception to the spread of more airline-style retailing, with online booking for the cheapest advance purchase tickets. This offers bargain fares to many, but for people who cannot book in advance, or who need flexibility in their travel plans, or who find navigating the range of ticket types and discount offers confusing, the gap between the headline price deals and the fares they have to pay can seem very wide.

1. Looking back at Control period 3

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So the NPS measure of value for money is one of the few which has not improved materially over CP3, and stands at a lowly 46%.

A more efficient railwayOne factor behind the fare increases was the high cost of running the railway in CP3. We noted above the huge increase in Network Rail costs which was sanctioned by the 2003 interim review. That review also charged Network Rail with making cost efficiencies of 31% over the course of CP3.

In the final analysis, the company achieved efficiency improvements of 27% through initiatives such as bringing maintenance work in-house, improving the knowledge of its asset base and condition, investing in high output plant and other new technologies, and good housekeeping. This is a big improvement, but a disappointment considering the large gap that remains between Network Rail costs and those for other comparable networks.4

In the first 4 years of CP35 central government support to franchised operators fell by almost 40% as the increase in passenger numbers drove strong revenue growth.

Raising the barClearly the industry achieved significant progress in CP3, from a low base. One reward for this is to be asked to do still more in CP4.No death on the railway is acceptable, and at ORR we have set out a vision of a railway with no fatalities to passengers or employees, due to causes for which the industry is responsible.

1. Looking back at Control period 3

It is possible to improve performance further without excessive cost. This can be seen from the achievements not only of smaller operators such as Chiltern, c2c and Merseyrail (all now delivering PPM of 95%+) but of more complex operations such as South West Trains and Arriva Trains Wales (both above 93%). The Government target of 92-93% for the end of CP4 is entirely achievable, but will take further sustained effort particularly in the long distance sector.

As train performance has improved, other aspects of service quality have taken a higher profile. The railway still falls down too often by failing to provide passengers with useful and timely information when services are disrupted. We have noted the importance of making big cuts in disruption due to planned engineering work, and require Network Rail to achieve a 37% reduction by the end of CP4. The condition of stations, and the facilities provided, are also increasingly coming under scrutiny.

Alongside this the industry must cope both with the short-term impact of recession, and the expected medium-term resumption of growth. To handle this Network Rail is embarking on the biggest programme of network expansion in living memory. And at the end of May the passenger and freight operators and Network Rail published their Planning ahead document, setting out how they will contribute to developing ideas and plans for the railway beyond 2014, so that it makes an increasingly important and effective contribution to meeting the needs of the country and of rail users.

But the industry can face these challenges with a new confidence gained from its achievements since 2004. And the ambitious goals set by Governments in their high level output specifications show that they, too, once again have confidence that the railway can be asked to make a greater contribution to the prosperity and sustainability of the country. We have come a long way in the last five years.4 See the Determination of Network Rail’s outputs and funding for 2009-14

5 Figures for 2008-09 are not yet available

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2. Delivering an ever decreasing safety risk

OverviewOverall, the safety of the railways is being been maintained and continues to improve in some areas. Some headlines:

Passenger safety: ● Harm to train passengers is at an historic low. Fatality risk per traveller kilometre is lower than any comparable transport mode (three times safer than the coach/bus; 26 times safer than the car; 1110 times safer than the motorbike). The principal risks to passengers occur at stations, and involve slips trips and falls. Five passengers died in accidents in 2008 (nine in 2007); two were struck by trains on level crossings, two occurred whilst boarding or alighting from trains (at the platform-train interface), and one person died after falling on a station escalator.

Workforce safety remains a concern. ● Sadly, there were three fatalities and 134 major injuries involving railway workers. There has been no significant change in the level of fatalities and major injuries in the past three years, and some evidence of an adverse trend this year.

No fatal ● train accidents (those leading to passenger or workforce fatalities) occurred. The frequency of such incidents has dropped steadily over the years, and is now at its lowest ever level. But there has been no significant reduction in the number of incidents classed by the industry as potentially higher-risk train accidents for the past four years, and no significant change in the industry’s measure of train accident precursors (the Precursor indicator model - PIM) over the past three years.

● Level crossing safety remains a concern. There were 19 collisions between trains and road vehicles and 14 deaths (two road vehicle users and 12 pedestrians) at level crossings. Level crossing misuse is also the predominant contributor to train accident risk,

as measured by the PIM. ORR is contributing to a review of level crossing law being carried out by the Law Commissions for Scotland and for England & Wales, and we are reviewing our guidance on level crossing safety. Network Rail has continued a major advertising campaign alerting the public to the possible consequences of level crossing misuse.

Health and safety performance

Precursor indicator modelThe PIM shows changes in the risk of train accidents over time. The value given is a moving annual average. It therefore reflects precursors from the most recent 12 months, and is normalised by train miles to account for changes in the activity level on the railway. The risk level at the end of March 2002 is the reference level for the PIM and is set to 100.

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Figure 2: Trends in PIM indicator value

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2. Delivering an ever decreasing safety risk

The PIM data reflects the performance of the whole industry. It has been broadly unchanged over the last few years, but there have been changes in contribution to the overall risk from some of the main precursor groups:

the risk from infrastructure failures due to problems with structures ●and track fell 1.8 points in the year (although this improvement was partially offset by an increase in risk due to environmental effects);the risk from objects on the line was also lower over the year; and ●there was a relatively large increase in the risk from misuse of ●level crossings due to public action. The level of risk is showing a distinct upward trend.

Workforce fatalities and injuries

Three railway workers died, making 2008 the worst year since 2005. The number of major injuries to workers has been broadly similar over the past three years.

In June a track worker working on overhead lines died when the metal basket on a hoist fell away from its hydraulic arm. Two other members of the workforce were injured. A worker died after being crushed between a JCB and a dumper truck and a crane operator died when struck by a road rail vehicle.

We intend to prioritise inspection of track worker safety and risk management at construction sites in 2009-10. We will focus in particular on how the industry applies the Construction (Design and Management) Regulations 2006 to manage non-railway specific health and safety risks.

Signals passed at danger (SPADs)

The provisional total for category A SPADs on Network Rail infrastructure in 2008-09 is 294, compared to 359 for 2007-08. However, in 2007-08 there was a three month period where SPADs were at their highest level since the introduction of TPWS (the train protection and warning system). This temporary blip remains unexplained.

The level of SPAD risk, measured by RSSB, is about 15% of the March 2001 baseline figure, showing how successful TPWS has been in reducing train accident risk. Nevertheless, the end of year risk level (15%) was higher than at the beginning of the year (13%).

Network Rail and the train operating companies continue to work together, through local operations risk reduction and mitigation (OPSRAM) forums to improve SPAD management.

Level crossings

Public misuse of level crossings is the single biggest contributor to train accident risk. However, we believe that those elements of the risk that are susceptible to control by the industry are generally well managed. We examined the use of user-worked (private) crossings (UWC), looking into how well users understood their responsibilities and managed the risks at the crossings.

In 2008-09 Network Rail committed to a programme of UWC closures and enhancements, partly funded by the CP3 safety and environment fund. 470 UWCs are targeted for closure. A fast track closure system has been developed with internal support, to enable negotiation of legal and financial deliverables and physical removal in 24 weeks. We welcome this as an important initiative.

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2. Delivering an ever decreasing safety risk

Public misuse of level crossings peaked during early summer 2008. Network Rail is running a hard hitting advertising campaign Don’t run the risk to raise awareness of the dangers of level crossing abuse.

During the year the Law Commissions for Scotland and for England & Wales progressed their joint review of level crossing law, which is widely perceived as complex and difficult. We are continuing to contribute to the Commissions’ work, which we regard as a major strategic opportunity to improve risk management at level crossings.

ORR’s strategy and business planSeveral of our strategic themes for 2009-14 aim to ensure that the industry’s health and safety performance continues to improve. See NRR Q3 (last issue) for details.

In the first year of the five-year strategy, in addition to the work discussed above, we will be auditing key areas of significant safety risk – for example track and signalling maintenance, and worker safety in possessions.

We will continue encouraging the industry to measure, and where appropriate improve its safety culture. Using this approach to improve health and safety performance has been shown to be successful in an increasingly wide range of industries, and we are confident that the same will be true of the railway industry.

We will investigate circumstances that may be likely to require enforcement action, including following up complaints, and we will ensure that the industry considers, and where appropriate takes action, on recommendations arising from investigations by the Rail Accident Investigation Branch (RAIB).

We believe there is scope for further improvement in the health and safety performance of the industry, and will be working with the railway

companies, trades unions and other stakeholders to help achieve our vision of zero employee and industry-caused passenger fatalities and declining levels of risk.

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Network Rail will deliver a major programme of infrastructure enhancements over the next five years. In combination with the new rolling stock being ordered and delivered, this will allow more and longer trains to run, increase capacity for freight, reduce delays and improve journey times.

This article explains:

what funding Network Rail has for enhancements; ● how we define what outputs Network Rail must deliver; and ● how we will monitor whether the company is on course to deliver ●these outputs.

Funding

Network Rail gets funding for enhancement projects from three main sources:

our 2008 periodic review determination – which set the company’s ●funding for 2009-14; Government funding outside the periodic review; and ●contracts with third parties, such as train operating companies and ●private developers.

Our periodic review provides Network Rail with funding to spend around £8.0bn on enhancements in England & Wales and over £400m in Scotland (in 2009-10 prices) over the next five years.

But some major schemes, for example Crossrail and Glasgow-Edinburgh improvements, were not part of the Governments’ high level output specifications at the time of our periodic review and hence are not funded by it. Network Rail’s work on these types of projects can be funded with ORR’s agreement that the cost can be added to the company’s asset base (and hence the company could earn a return on

3. Delivering enhancements to the railway

the money spent). Exactly how much Network Rail will receive for third party schemes depends on commercial negotiations.

OutputsWhen we published our periodic review determination we asked Network Rail to produce a delivery plan for the period 2009-14. This is the first time the company has been required to produce a five year delivery plan and it is an important document which will allow train operators to plan their own businesses better.

Network Rail published its plan in March 2009. This includes a specific section on enhancement projects in which, for each project, Network Rail sets out what outputs it will deliver and the main milestones. The projects are those funded by our periodic review and other Government funded projects which were well advanced at the time of publication. Third party schemes are not included.

The plan is a significant step forward and Network Rail has made good progress in many areas, but it did not fully meet our requirements or those of operators and funders. For a significant number of projects it was not clear enough when describing the outputs Network Rail will deliver. For example, plans to lengthen platforms in the south of England (to allow longer trains to run and hence address overcrowding) in many cases did not commit Network Rail to lengthen the platforms at specific stations, saying instead that further work was needed.

Network Rail has acknowledged the criticisms that were made and proposes to make improvements. We have told Network Rail to make these improvements and others and publish the revised plan by 30 June.

This chain of events, to define what outputs Network Rail will deliver, is summarised in the table below:

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Date

October 2008 ORR published its periodic review determination setting out Network Rail’s overall funding and high level outputs.

February 2009 Network Rail circulated the part of its delivery plan covering enhancements to train operators and funders.

March 2009 ORR consulted operators and funders on these enhancement plans. Network Rail publishes the full delivery plan.

March 2009 ORR received consultation responses on the enhancement part.

May 2009 ORR wrote to Network Rail confirming what improvements must be made to the enhancement part of the plan.

June 2009 Network Rail must publish the revised plan.

There are many different types of enhancement projects in the delivery plan, but they can be grouped into four broad categories:

ring-fenced funds – for example a fund to develop a strategic ●freight network; major projects – large scale projects, for example to improve the ●track layout and signalling at Reading and to increase the number of platforms;projects to lengthen platforms and improve power supplies to ●allow longer trains to run – for example longer platforms in the Manchester area; and

3. Delivering enhancements to the railway

other improvements - for example a project to improve line speed ●between Sheffield and London.

The funds have governance arrangements to decide how the money should be spent. At this stage only part of the money may have been allocated and hence the delivery plan may not be complete. As more outputs are agreed this will be recorded in the delivery plan.

The major projects are at different stages of development but the plan needs to record the current view of what Network Rail’s obligations are. As an example, the box on page 12 shows how Network Rail has described what it will deliver for the Reading project.

The descriptions of the projects to lengthen platforms and improve power supplies need considerably more work for the 30 June update. Similarly, the line speed improvement projects are often too vague in their description of what will be done, and this also needs to be improved.

What will Network Rail deliver: extract for Reading from the delivery plan

New signalling centre replacing existing signal boxes in the ●Thames valley by December 2010.Four new platforms on the north side of the station for Great ●Western main line and cross country services by November 2012.A new south side platform and platform extensions for ●Waterloo line services by November 2012.

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Monitoring delivery

Our role is to monitor Network Rail’s progress with delivering enhancement projects. The purpose of monitoring is not just to discover whether the company has delivered the required output or not at the end of the project, but to assess at various stages whether it is on course to deliver. We can then require changes to get a project back on course, if necessary.

Although five years may seem like a long time, time lost at this stage could be hard to make up. So we already have work underway to check Network Rail’s progress and plans. This work is at two levels, the individual projects and the overall programme.

The project monitoring is itself of two main types – targeted pieces of work to address a certain issue and regular monitoring.

The targeted work includes:

● ‘initial reviews’ of some projects to take stock of the overall position. For example this would review how the project is being run, any legal issues, impacts on train timetables and passenger disruption and so on. A review of the King’s Cross project is complete and has shown that Network Rail is running the project well and has robust plans for future work. We have recently started initial reviews of the Reading and Birmingham New Street projects. We will publish a summary of the findings; review of Network Rail’s ● plans for Thameslink: the Thameslink project has the biggest funding allocation of any project in our periodic review of over £2.7bn. The project reached an important milestone in March 2009 when infrastructure work had to be completed to allow a major timetable change. Network Rail

3. Delivering enhancements to the railway

completed its work successfully. The project has now moved into the next stage and it is crucial that the company has robust programme plans and processes in place to deliver its obligations. We have therefore carried out a review of this and the review has recommended changes which we are now discussing with Network Rail, the Department for Transport and the other parties involved with the project. We will publish a summary of this report when completed; and ● efficiency scrutiny for some projects: in general we will not make detailed assessments of how efficiently Network Rail is spending money on each project. For projects in England & Wales we have already set overall funding allowances and the company pays part of any cost overruns and hence has a strong incentive to be efficient. But in some cases, particularly where money has been allocated from a fund, we need to decide what the efficient cost of the project is.

For regular project monitoring we have a process which will be based on receiving regular progress reports from Network Rail and then formally reviewing progress on a quarterly basis. These reviews focus on whether the company is on course to deliver its obligations on the project.

Some issues cannot be handled at the level of the individual project and have to be considered at the programme level. We have done a lot of work to press Network Rail to demonstrate that it has the capability – for example in terms of specialist skills – to deliver the overall enhancement programme. The company has provided us with detailed analysis and said that it can deliver. We will need to monitor progress on this.

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To help ensure that we have the specialist resources to hold Network Rail to account, we rely on technical experts within ORR and we also use independent reporters (see box).

The success of the enhancement programme will be crucially dependent on exactly how Network Rail involves the train operators in the projects. Operators are already closely involved in some projects and are therefore able to provide information on how the project needs to interact with their role. For example, there may be a need to allow time for driver training before new trains are introduced on an upgraded route. Network Rail has made positive proposals on how to get the industry more involved in some areas, for example in how best to spend its project development fund. Network Rail has said it will set out how operators will be involved in other aspects of the enhancement programme.

3. Delivering enhancements to the railway

The role of the reporterWe use independent reporters to give objective, expert assessment of Network Rail’s progress.

Two independent reporter consortia have been appointed:

A consortium led by Nichols, with Turner & Townsend and ●AecomA consortium led by Halcrow, with KPMG and Cyril Sweett ●

They will support ORR in holding Network Rail to account on issues related to all enhancements, including work we have to do on third party investments.

The independent reporter role is designed not just to carry out work for ORR but also to provide ongoing advice and assistance to Network Rail. The reporters should provide constructive proposals to Network Rail on how to improve its performance.

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4. Focus on passenger needs: our consumer law role

In the Q3 edition of the National rail review, we highlighted ORR’s new corporate strategy for 2009-14 and outlined our key themes. Here we briefly describe our consumer law role, which closely links with the theme: focus on the needs of passengers and freight customers.

Consumer law aims to ensure fairness and transparency for consumers in their dealings with businesses. We are confident that as an enforcer of consumer law we can make a positive difference to the passenger experience and this role, therefore, has a part to play in our corporate focus on the needs of passengers.

Under our new strategy6 we say that:

working with our stakeholders (such as the Department for ●Transport (DfT), Transport Scotland, Passenger Focus and London TravelWatch) we will consider ways in which we as the independent regulator can help improve the credibility and effectiveness of passenger protection…, including through the use of our consumer law enforcement powers; and we will measure our success by reference to improvements in: ●

overall passenger satisfaction as measured by the National ●passenger survey (NPS); andspecific areas of passenger concern such as trust in fair ●treatment.

Our aims

We aim to:

make a positive difference to the passenger experience by pushing ●for improved clarity as to what the industry is required to provide, making sure that information given is not misleading and that passengers have access to the information needed to make the

right choices and to feel confident that they have got the best deal for their particular needs; and by doing so help empower passengers so that they themselves are able to drive ●improvements in what the industry offers, in full knowledge of what the industry is obliged to provide and what sanctions are available when it fails to deliver.

6 http://www.rail-reg.gov.uk/upload/pdf/388.pdf

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4. Focus on passenger needs: our consumer law role

Our approachThis is about:

fitting into an existing framework of passenger protection. We ●intend to add value, and reinforce (not replicate or substitute for) existing mechanisms;empowering passengers so that they themselves are able to drive ●improvements; and dealing with issues not individual complaints. ●

This is not about:

a move by us to get between the industry and its customers. ●Passengers should still contact train operating companies (TOCs) first. Passenger Focus and London TravelWatch will broaden their significant roles in the handling of individual complaints; burdening the industry with new obligations. The law exists anyway ●and our power to enforce has been around for some time. This is about a change of focus and emphasis; or a negative focus on the industry. This is more to do with ensuring ●that passengers are aware of the facts.

We are interested in addressing issues, not in intervening between the TOCs and their customers. A complaint should first be made to the TOC concerned to give it the opportunity to resolve the issue. The vast majority of problems are sorted out at this stage. However, individuals can, where they do not obtain a satisfactory response, appeal to Passenger Focus or London TravelWatch for assistance. Both bodies have considerable experience in working on passengers’ behalf to get TOCs to rectify problems. Other consumer bodies such as the Advertising Standards Authority can intervene to protect passengers – by policing the self-regulatory advertising industry codes.

Rail passengers already benefit from a range of protections in the retail experience. This framework of protections arises from rail regulatory provisions (licences and franchises), sector specific statutory provisions (assistance from Passenger Focus or London TravelWatch) as well as from consumer law.

If something unfair is occurring, and there are railway sector mechanisms for sorting out the problems, we or a partner organisation such as DfT/Transport Scotland, will use those first. Efficient and effective partnership working in these areas is important to ensure that problems can be quickly addressed with as little duplicated effort as possible for all concerned. We all aim to work together with partner organisations in order to ensure that issues are dealt with in accordance with better regulation principles: proportionality, accountability, consistency, transparency and targeting.

However, if there is a gap in railway sector protections, we may be able to take action under consumer law and our usual first step would be to consult the industry party concerned.

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Our powersOur consumer law powers enable us to stop infringements where passengers as a group are, or could be, put at an unfair disadvantage. The powers cover rail passengers and the businesses they deal with. The powers allow for a three-stage escalation process which starts with consulting with the business to stop the infringement and ensure that it is not repeated. If this does not fix the problem, the next stage would be to ask the business to sign a commitment (an undertaking) to comply with the law. If this still does not work, a third and final stage would be to apply to the court to stop the law being broken.

It is important to emphasise that the powers are about ensuring good future business conduct. We cannot use our powers to remedy individual grievance, nor to punish a business for its past behaviour.

Our expectation is that the rail industry is a professional industry that is constantly striving to meet the needs of its customers. In this context, we want to achieve the delivery of better outcomes for passengers through education, consultation and facilitation, with enforcement action only as a last resort.

In the vast majority of cases simply bringing the issue to the attention of the TOC or third party retailer will result in a positive outcome with no need for court action – our experience has shown that the TOC or a third party supplier is sometimes simply unaware that passengers are at risk of being misled or that the offer is not as clear as it could be. A simple tweak to the wording could be all that is needed.

We are absorbing this new focus using existing staff, primarily within our competition and consumer policy team. We intend to focus on a few key issues over the course of each business year, prioritising those where we can add the most value.

What next?The rail industry can expect to hear from us only infrequently and only on the basis of issues, not about individual complaints. Having said that, over the next few months we are planning to talk to governmental and industry stakeholders in order to set out our approach to our consumer law role and find out about industry and passenger experiences and views.

We also intend to publish a guide to our approach during this business year.

In the meantime, you can keep up-to-date through the consumer section of our website:

http://www.rail-reg.gov.uk/server/show/nav.2136

4. Focus on passenger needs: our consumer law role