Operator of last resort
An operator of last resort is a business in the United Kingdom that operates a railway franchise in the event that a train operating company is no longer able to do so.
Purpose
Under the Railways Act 1993, which privatised passenger operations in the United Kingdom, the government is required to maintain continuity of passenger rail services if a franchise is terminated. In some instances, the government has been able to negotiate for the existing franchisee to continue to operate the franchise on a management contract until it can be relet, as happened when GNER defaulted on the InterCity East Coast franchise in 2007.[1]
Should this not be possible, the Department for Transport (DfT) (Scottish Parliament in Scotland, Welsh Parliament in Wales), is required to step in as the operator of last resort.
Structure
In July 2009, the DfT established Directly Operated Railways (DOR) as its operator of last resort.[2] In November 2015, the DfT wound up DOR and appointed a partnership of Arup Group, Ernst & Young and SNC-Lavalin Rail & Transit.[3]
Utilisation
Since privatisation in the mid-1990s there have been five occasions when an operator of last resort has been required to step in:
Current and future
- London North Eastern Railway has operated the InterCity East Coast franchise since 2018 after Virgin Trains East Coast defaulted.[4]
- Northern Trains has operated the Northern franchise since 1 March 2020 after the Arriva Rail North franchise was terminated by the Department for Transport.[5]
- Transport for Wales Rail will be taken over by the Welsh Government's operator of last resort, from KeolisAmey Wales, on 7 February 2021 after the Wales & Borders franchise became unviable as a result of the COVID-19 pandemic.[6]
Past
- South Eastern Trains operated the South Eastern franchise from 2003 until 2006, after the Connex South Eastern franchise was terminated by the Strategic Rail Authority.[7]
- East Coast operated the InterCity East Coast franchise from 2009 until 2015, after National Express East Coast defaulted.[8]
References
- East Coast to be re-franchised Railway Gazette International January 2007 page 6
- About DOR Directly Operated Railways
- Government accused of contracting out emergency train franchises to private firms The Independent 18 January 2016
- East Coast train line to be put into public control BBC News 16 May 2018
- Troubled rail firm Northern brought under government control BBC News 29 January 2020
- Welsh Government takes control of franchise The Railway Magazine issue 1436 November 2020 page 6
- Connex sacked from South-east franchise The Railway Magazine issue 1229 September 2003 page 10
- East Coast rail change confirmed BBC News 5 November 2009