Scottish Government set to reward failure and give Abellio a free ride to continue operating the ScotRail franchise from 2022.
RAIL UNION RMT today expressed its concern that the Scottish Government’s proposed revised ‘Franchising Policy Statement’ is laying the groundwork to give Dutch state-owned Abellio a direct award when the franchise ends next year, despite its well documented poor performance, rather than using its powers to take its rail services into public ownership.
As the consultation on the Franchising Policy Statement closes, it is clear the Statement reflects the Scottish Government’s intention to extend Abellio’s tenure. The Statement sets out a vast number of circumstances in which ‘the Scottish Ministers may decide to directly award a franchise agreement’ rather than tendering the franchise or taking it into public ownership via the Operator of Last Resort (OLR).
In contrast, earlier this week, Wales’ rail passenger services transferred into public ownership, as the Welsh Government has recognised that this is the most effective way to provide stability to the rail network in the face of ongoing Covid-19 uncertainty.
RMT believes that it would provide far greater value for money for passengers and taxpayers and provide greater resilience for Scotland’s rail network if the Scottish Government stopped making excuses and instead used its existing powers to take control of Scotland’s rail passenger services.
RMT General Secretary Mick Cash said:
“It is frankly unbelievable that the Scottish Government is poised to reward failure and give Abellio a free ride carrying operating rail services in Scotland.
“In the same week that the Government in Wales has taken rail services back into public ownership the Scottish government is once against showing its biased in favour of the privatised railway.
“The Scottish Government already has the powers to take its rail passenger services into public ownership, via the Operator of Last Resort yet it keeps making excuses not to.
“In response to a Freedom of Information case The Scottish Government has also refused to publish its response to the UK Government’s Williams Review of Rail, choosing instead to hide behind a veil of secrecy.
“This lack of transparency just reinforces RMT’s concerns that it opposed to public ownership of Scotland’s railways, despite this being the best way to deliver a resilient, cost-effective and reliable service.
“We need action, not more excuses, from the Scottish Government.”
Notes for editors
Paragraphs 9 and 10 set out the circumstances under which an Invitation to Tender for rail franchises would not be issued:
“Subject to the parameters described in paragraph 8, it is likely that the Scottish Ministers will not issue an invitation to tender (and will make a direct award) where, in their reasonable opinion, disruption to rail passenger services or the immediate risk of such disruption means that it would not be practicable to issue an invitation to tender.
10. In addition, and again subject to the parameters described in paragraph 8, it is likely that the Scottish Ministers will not issue an invitation to tender (and will make a direct award) where, in their reasonable opinion,
· there are circumstances which mean that it would not be appropriate to issue an invitation to tender, including but not limited to situations where there are other market conditions which could affect the number or quality of bids likely to be received if the agreement were the subject of a competitive tendering procedure, such as uncertain or unpredictable rail travel market conditions or where a number of competitive tendering procedures are already being run (by the Scottish Ministers, the Secretary of State or the Welsh Ministers).
· issuing an invitation to tender would not be conducive to the fulfilment of the Scottish Ministers’ policy objectives for rail services and as such would not be appropriate for the time being. These objectives include:
- Ensuring the on-going, stable delivery of high performing rail services;
- Maximising the contribution that rail services can make to tackling climate change;
- Improving industry alignment and service integration, where possible, to increase effectiveness, reduce costs and place the rail industry on a sustainable financial footing;
- Supporting an environment where the whole rail system can respond swiftly and effectively to proposals for rail reform.
- Ensuring value for money for tax payers and fare payers through the ability to engage the rail services market with clarity on requirements for the delivery of future rail services.”
Paragraph 11 states: “11. Where any of the circumstances set out at paragraphs 9 or 10 apply and subject to paragraph 13, the Scottish Ministers may decide to directly award a franchise agreement. In determining whether and to whom to make a direct award, the Scottish Ministers will have regard to all requirements and obligations under the relevant legal frameworks and the policy objectives set out in paragraph 10.”
The following text is taken from RMT’s response to the consultation, explaining this issue in more detail:
“The Scottish Government has, thus far, given two reasons for why it has not opted to take control of its rail passenger services via the OLR. In September 2020, the Cabinet Secretary Michael Matheson appeared to dismiss utilising the OLR when he told the REC Committee that ‘The problem is that we would implement that model for only a limited period of time.’ RMT believes that to suggest in some way that the OLR is a time limited option is incorrect and deliberately misleading. The UK Government operates two franchises, LNER and Northern via the OLR, and has done for some time. LNER has been operated by the OLR since 2018, with the current contact in place until 2023, with the possibility to extend until 2025. Similarly, the Welsh Government does not view its arrangements to be a short term arrangement. Therefore, there is nothing to support the Cabinet Secretary’s statement that the OLR is a time limited option.
The Scottish Government has also cited the need for the UK Government Williams Review of Rail to report before it make decisions regarding the future of Scotland’s rail passenger services, and paragraph 2 of the franchising policy statement states that ‘it is anticipated the White Paper could lead to significant changes in the way in which the provision of passenger rail services will be arranged in the future’. It is, of course, the case that the Westminster Government’s Williams Review of the railway remains unpublished at this time. However, RMT believes that the Westminster Government’s delays should not prevent the Scottish Government taking action now, under the existing legislative framework, to bring improvements for Scotland’s passengers and taxpayers.
In our response to the Williams Review, RMT called for devolved bodies such as the Scottish Government to be given the right to appoint a public sector operator, without the need to go through a tendering process, and urged the Scottish Government to do the same. However, RMT does not see the delayed publication of the review as a barrier to the Scottish Government taking control of its rail passenger services now. If the Williams review were to give the Scottish Government additional powers which enabled it to directly appoint a public sector operator, without the need for a franchising process, having rail passenger services already in the public sector, being run via the OLR, would mean the Scottish Government was best placed to take advantage of the new powers.
However, even if the Williams review does not afford the Scottish Government these powers, and it is still required to undergo a tendering process to appoint an operator, then again, having rail passenger services already being run by the public sector OLR will mean the Scottish Government would be far better placed to put in the ‘robust’ public sector bid it is committed to.
RMT also wishes to express its disappointment that the Scottish Government has recently refused to publish its response to the Williams Review, despite a request being made via the Freedom of Information Act. This secretive approach just serves to reinforce RMT’s concerns that the Scottish Government is not committed to running its rail passenger services in the public sector.”