The
government


is
said
to
be
poised
to
reintroduce
a
degree
of
commercial
freedom
in
National
Rail
Contracts,
with
the
intention
of
allowing
operators
to
increase
profits.

It
is
reported
that
the
owners
of
operators
are
urging
the
government
to
loosen
the
tight
restrictions
of
the
present
contracts.
These
were
introduced
in
the
wake
of
the
Covid-19
pandemic
which
led
to
the
conventional
franchises
being
suspended
in
March
2020
and
then
cancelled
in
September.

Emergency
agreements
replaced
the
franchises,
in
which
the
Department
for
Transport
collected
the
revenues
and
paid
the
operators’
costs,
plus
a
management
fee.
They
have
now
been
replaced
by
new-style
National
Rail
Contracts,
which
also
involve
a
management
fee
and
very
little
commercial
risk
for
the
operators.

The
Financial
Times
has
reported
that
talks
over
changing
the
terms
of
these
contracts
have
already
started,
amid
concerns
that
passenger
numbers,
although
rising,
have
not
yet
returned
to
pre-Covid
levels
on
some
routes.
At
the
same
time
several
operators,
including
nationalised
LNER,
say
their
passenger
levels
are
now
higher
than
they
were
in
2019.

LNER
is
one
of
four
renationalised
operators
in
England.
The
others
are
Northern,
Southeastern
and
TransPennine
Express.
Caledonian
Sleeper,
ScotRail
and
Transport
for
Wales
have
also
been
taken
over
by
their
respective
devolved
governments.

The
need
to
attract
more
passengers
and
increase
earnings
was
emphasised
by
transport
secretary
Mark
Harper
last
week.
He
told
the
Commons
Transport
Committee:
‘There
are
only
two
ways
you
can
make
the
rail
industry
sustainable.
You
either
drive
up
revenue
or
you
reduce
costs.
And
taking
costs
out
means
reducing
services.’

Meanwhile,
plans
to
create
a
new
‘guiding
mind’
called
Great
British
Railways,
which
would
have
its
headquarters
in
Derby
and
control
passenger
contracts
as
well
as
the
infrastructure,
are
apparently
suspended
for
now.
The
government
has
not
allocated
any
Parliamentary
time
to
debating
an
Act
of
Parliament
authorising
GBR
this
side
of
the
forthcoming
General
Election.