THE debts of train operating companies may be moved to the public sector balance sheet, effectively ‘renationalising’ the businesses, following the introduction of emergency support by the Department for Transport on 23 March as lockdown took hold.
All DfT franchises have become management contracts under ‘EMAs’ (emergency measures agreements), with all costs being met by the DfT and revenue also going to the Department. The franchise owners receive a management fee of no more than 2 per cent, and this will continue until 20 September at least.
As a result, the Office of National Statistics has now launched a review to see whether the companies’ debts should still be included in the private sector figures.
It said: ‘Alongside transferring the financial risk to government, EMAs also imposed some obligations on the private train operating companies, in what is already a highly regulated industry. The ONS is therefore assessing if these new procedures should affect the statistical classification of the train operating companies within the UK national accounts.’
The ONS added that the result of its review will be revealed ‘as soon as possible’.