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1Rail Group The Big Question Peter Wilkinson, Director, Rail Franchising

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2Rail Group

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3 Public & Private Sector Partnerships Work Passenger Growth Passenger Satisfaction Investment Safety

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4Rail Group The Evolution of the Process We want Engagement and Partnership with all participants Inclusivity Franchised and Open Access, freight, infrastructure and the industry supply chain A process that is transparent and simple Bidding propositions that are Innovative And it has to be Safe A future that is Sustainable

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5Rail Group Future Challenges Capacity Punctuality and performance Funding, costs and profitability A more discerning passenger base New skills and investment in the workforce Investment in technology and innovation Sustainability

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6Rail Group Growth and Capacity Growth in Freight Ebay, amazon.co.uk, Tesco Growth in Passengers For many, no other option More commuters travelling further Costs of car ownership and urbanisation

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7Rail Group The need for speed Speed is not a luxury It should be an essential part of our ambition and ambition causes innovation Journey time improvement 125mph should be the basic standard on: East Coast (140pmh post with IEP) West Coast (135mph with Pendolino) Great Western (140 with IEP) Great Eastern South Western (Bournemouth Southampton) Other routes that should touch 125 on key sections TPE Midland Main Line Thames Valley

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8Rail Group Punctuality and Performance Rolling Stock Reliability Infrastructure External Factors Weather Passenger Expectations

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9Rail Group Re-thinking our approach to the Timetable We need a re-think about the timing of Britains railways to benefit existing passengers and attract new markets onto rail, in particular the car-dominated non-Central-London market. reduced journey times, in many cases on the scale of those anticipated by HS2, from improved connections and new fast long distance expresses timed to maximise the potential of the existing infrastructure increased frequencies, especially at busier times, without requiring additional trains to be run an opportunity to take a fresh look at overlooked markets that could be served by rail greater flexibility to tailor supply to demand, thereby avoiding unnecessary costs by providing, a consistent, regular and symmetric service pattern, seven days a week, from start to finish of service Improved service recovery opportunities to expand the freight market increased access to the infrastructure for maintenance and reduced need for disruptive engineering work This will mean investment in some infrastructure, driven by the requirements of the timetable, to allow cross-platform interchange to take place at stations where the existing track layout does not allow this. Network Rail and DfT will be working with operators to examine the opportunities that such a re-think might provide and we expect to pilot this through a forthcoming franchise competition.

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10Rail Group Funding Britains railways rail subsidy (2011/12 prices) Net cost to Government per passenger mile (p) Ratio of taxpayer to farepayer funding (%) Long distance7.3p25 : 75 London and South East4.819 : 81 Regional31.161 : 39 Since privatisation, revenue growth of 2.3 billion in 2011-12 prices (mostly from increased passenger numbers rather than higher fares) has been more than offset by three factors: a 1.7 billion increase in train operating costs, which have grown in tandem with the growth of passenger numbers; 1.5 billion extra cost associated with funding Network Rail's regulatory asset base, its borrowing to finance capital projects; and 0.5 billion in additional rolling stock charges, again reflecting increased demand.

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11Rail Group The rail industry received 1.3bn of other income in 2011-12, an increase of 5.1% compared to 2010-11. Train operators received 0.7bn from car parking, property rental, catering and other sales. Network Rail received 0.6bn from its stations and property portfolio, and charges to freight and open access train operators. A privatised railway - really?

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12Rail Group Cost and Profitability Distribution of costs between the taxpayer and farepayer Change the argument about Premium / Subsidy Devolution and choices to be faced Investment and private capital Trade offs between long term short term affordability and long term value for money

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13Rail Group Community, Environment and Sustainability Sustainability is fundamental to rails long term success Must be embedded throughout the industry: its a core requirement not an optional extra. We want ambitious, innovative proposals in our bids to deliver environmental improvements, support economic growth and bring communities together There are today over 50 Community Rail Partnerships putting real money, peal people-power and real innovation into rail, Community Rail Partnerships have re- opened local rail services and transformed long decaying assets into vital community resources

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14Rail Group New solutions Up until now Where is the passenger? Or the workforce? One (franchising) model fits all No sense of partnership Lots of tell little ask An air of we know best Unable to react to changing markets Have not created conditions for innovation or investment No sense of local Future Passenger must be at the centre of every aspect of design, the workforce properly supported Less tell more ask Contractual relationships fit for the specific railway circumstances Real innovation properly recognised in bids New alliances and partnerships Localise the railway

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15Rail Group With innovation in mind Just suppose: Instead of measuring arrival times, we measure the efficiency of connections? Instead of the barriers being shut until your ticket opens them, they are open and only close if you dont present your ticket Instead of a map of routes, we have a map of flows showing where people travel between and all modes and we planned our railways around this

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16Rail Group What Will Our Legacy Be? complacency has no part in it The rest of the world is investing for tomorrow, now. So should we

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17Rail Group My Challenge To You We need a new kind of partnership - at all levels, across all interfaces Between; workforce and passengers DfT and the Industry Industry and the supply chain DfT, Regional and Local Government