DOR untainted by state ownership - Official

Exciting news of rebellion from deep within the state owned monolith that is East Coast!

According to Peter Williams, East Coast commercial director, in an interview in Management Today:

‘A lot of people will say East Coast is a model for how public sector-run companies can be successful,’ he told MT.

‘Personally, it’s quite funny sitting here watching conversations take place about what is the right thing to do. But if you look at the individuals behind DOR’s success, the management team are all from the private sector.'

Quite so.

East Coast's success is, therefore, all the more impressive with so little nationalised experience amongst DOR's 'management team':
 
Michael Holden, Chief Executive Officer, & Non-executive Chairman of East Coast Main Line Company Limited
Michael Holden has extensive experience in managing railways and railway projects within the UK and Europe. He started his early career with British Rail as a traffic student in 1974...

Doug Sutherland, Chairman
Doug Sutherland is a chartered management accountant... In 1995 he moved to the public sector, initially as managing director finance for North of Scotland Water and then managing director finance and commercial for the Strategic Rail Authority... .
 
Andy Cope, Non-executive director
Andy Cope is a Chartered Engineer who started work as an apprentice with the Birmingham Division of British Rail in 1972...

David Walker, Finance Director
David Walker is a Fellow of the Chartered Association of Certified Accountants, who started his career with the National Coal Board... 

Rob Mason, Non-executive director
Robert Mason has over 30 years’ experience in the rail industry... In the run up to privatisation, Rob was the British Rail Director of Privatisation Studies...

Each and every one of them unsullied by public sector taint!

So on which precise date does Private-Sector-Year-Zero begin at DOR?

ECML - It's a wash out!

This from JD Bitterspoon...

Rumour has it that DOR is branching out into a range of new sanitary ware.  

 

With the timetable reliability 'plumbing' new depths, customer service generally 'down the pan', passengers increasingly left with a 'sinking' feeling, East Coast's regular customers hope that they have better luck running this bath than they do a train service.  

Hour-plus delays the third Monday in a row, and no service at all between Peterborough and Kings Cross this morning.  

An absolute shower.

Eye observes:  If DOR entered the bathroom suite market no doubt the ORR would insist the 'plumbing' was provided by Network Rail. Inevitably, therefore, the new venture would fail to 'wash its face'. (that's enough leaky old jokes. Ed)

Virgin set to get extension as DOR deactivated

This from the Department for Transport...

Department for Transport to negotiate with Virgin on temporary operation of West Coast rail services

The Department for Transport will negotiate with Virgin Rail Group for them to continue providing rail services on the West Coast Main Line for a temporary period.

The current franchise is due to expire on 9 December after which it is the government’s intention that Virgin remain as operator for a short period – expected to be between 9 and 13 months – while a competition is run for an interim franchise agreement. This interim agreement, which would be open to any bidders, will then run until the new long term West Coast franchise is ready to commence.

The government believes that this is the best way to ensure services are maintained and that there is no impact on passengers.

Transport Secretary Patrick McLoughlin said:

    “The cancellation of the InterCity West Coast franchise is deeply regrettable and I apologise to the bidders involved and the taxpayer who have a right to expect better.

    “My priority now is to fix the problem and the first step is to take urgent action to ensure that on the 9 December services continue to run to the same standard and passengers are not affected.

    “I believe Virgin remaining as operator for a short period of time is the best way to do this and my officials and I will be working flat out to make this happen.”

On 3 October the previous competition to run trains on this line was cancelled following the discovery of significant technical flaws in the way the franchise process was conducted.

The department also paused the on-going franchise programme including live competitions on Essex Thameside, Great Western and Thameslink and set up two independent reviews into what went wrong with the West Coast competition and the wider DfT rail franchise programme.
 
Notes to editors

• The Transport Secretary has ordered two independent reviews:
• The first will be an urgent independent examination into the lessons to be learned from the department’s handling of West Coast competition. Conducted by independent advisers and overseen by Centrica chief executive Sam Laidlaw and former PricewaterhouseCoopers strategy chairman Ed Smith, both DfT non-executive directors, this review will look as soon as possible at what happened and why with a view to delivering an initial report by the end of October.
• The second independent review will be undertaken by Eurostar chairman Richard Brown CBE, and examine the wider rail franchising programme. It will look in detail at whether changes are needed to the way risk is assessed and to the bidding and evaluation processes, and at how to get the other franchise competitions back on track as soon as possible. This will report back by the end of December.

ENDS

UPDATE: This from Directly Operated Railways...

Taxpayers will be relieved to know that we are not so much deactivated, as waiting in the wings! 

DOR names ICWC Team - Shocker

Found in the street outside the DfT's Marsham Street bunker...

 

Literally unbelievable!

DOR prepares to mobilise for ICWC nationalisation

Phones have been ringing across the industry as Directly Operated Railways assembles its West Coast team of Last Resort.

Despite McLoughlin's warm words about Beardie at today's Transport Select Committee he remained clear that the DfT would continue with First's winning bid, m'learned friends allowing.

Expect the state owned tanks to arrive at Euston on the eve of the 9th December.

Virgin launches new route to Scotland

This from Virginia Water...

With DOR set to run both East Coast and West Coast InterCity franchises the state will have an effective monopoly over the London - Scotland rail market.  

Happily this will put them in an excellent position to compete with short haul air services, including, and in particular, the new flights to be operated between Scotland and Heathrow from next summer by Virgin Atlantic.

Judicial review anyone?

DfT prepares to activate DOR on West Coast

As Beardie and ToT gear up for this afternoon's barnstorming performance at the TSC, the DfT is turning up the heat on Virgin.

In yesterday's Sunday Times Karl West reported that Marsham Street is considering renationalising the InterCity West Coast franchise if there are delays to the start of the new franchise (due to commence on the 9th December).

A DfT spokesman said "In view of the legal challenge from Virgin Trains, we are looking at our responsibilities under Section 30 of the Railways Act and it is only prudent to increase our focus on contingency planning."

On the plus side, taking over the ICWC franchise for a short time this year will help Directly Operated Railways prepare for a longer custodianship in 2019. (Shurely shome mishtake? Ed)

Holt to leave Directly Operated Railways

This from Rail Barbie...

I wanted to write and let you know personally that I will be stepping down from my position as both Chairman of Directly Operated Railways (DOR) and East Coast Main Line Company (East Coast), at the expiry of my contract term at the end of the year. I shall be taking up a new senior industry role at the beginning of January 2012.

I’ve immensely enjoyed being at the helm of East Coast, it’s a really good business and I’m genuinely sorry to be leaving. We’ve achieved a huge amount in the last two years and we’re just starting to see the benefits of the Company ‘turnaround’. The business still has a number of challenges to overcome – but I’m absolutely convinced we made the right base choices and have established a strong new foundation for our successes to be sustainable. The franchise extension until the end of 2013 will see this task largely completed – with Britain’s flagship train company in much better shape than when we started. I couldn’t have achieved this level of progress without the very strong support from the staff of East Coast, the board, and in particular Karen Boswell, East Coast’s Managing Director.

And so, I’m genuinely regretful of the fact that I won’t now be around to ‘finish the job’. The introduction of a major new timetable and the launch of a new complimentary catering offer in First Class in May 2011, have both been strategically significant and delivered positive results. Passenger numbers have increased by 3 per cent in the last year (2010/11), and East Coast is now one of the best financial performers in the rail industry.

I want to personally thank all our customers and stakeholders for travelling with us, but particularly for your engagement over the last couple of years. I can assure you that your feedback has been pivotal in helping us to drive our determination to, ‘get it right’. I know Karen and her team are passionate about carrying on the good work – and will welcome a continuance of the dialogue in the future.

Following my departure, Michael Holden will become Chairman of East Coast and Doug Sutherland Non Executive Chairman of Directly Operated Railways. Michael and Doug will fulfil these roles on an interim basis until discussions with the Department for Transport on filling these roles permanently are concluded.

- ENDS -

Rail Barbie's empire to expand?

This from Virginia Water...

I see in yesterday's Observer that First Group are considering handing back the keys on the Great Western franchise in 2013, rather than 2016.

Given the DfT's already packed reletting agenda, does this raise the prospect of Directly Operated Railways taking on its second InterCity operation?

And why not!

After all Rail Barbie's first franchise has been highly successful in reducing costs, raising performance and improving the timetable. (shurely shome mishtake? Ed)

The future's bright, the future's dull grey and purple...

UPDATE: This from the late Adam Smith...

This is wonderful news.

If First Group elects not to continue with its franchise beyond 2013 this will provide the most marvelous opportunity to test Villier's exciting ideas about residualising investment beyond franchise length.

What with First Group owning 12 power cars and numerous trailers upon which the Great Western franchise is utterly dependent if it is to deliver the DfT specified timetable.

How many managers does it take to run a franchise?

Telegrammed by The High Tea Party
So. Directly Operated Railways has published its accounts.

Amidst the usual self congratulatory PR puff there are one or two hard numbers.

Like the directors' remuneration for example.


Perhaps at some point the Department for Transport could explain why, in the Age of Austerity, we need an organisation like DOR to second guess the management decisions of East Coast's own well paid directors?

Meanwhile, trebles all round!

UPDATE: This from a reader who wishes to remain Anonymous...

Whilst the DfT Business Plan published today claims that:

We will also pursue our wider transparency agenda through publishing details of:

• Pay (senior staff salaries online from October 2010)

It would appear that such transparency does not extend to state owned East Coast.

According to yesterday's Mail on Sunday...

East Coast Main Line (ECML), which runs the troubled London-to-Edinburgh high-speed route, claimed that publishing the [salary] details ‘could lead to unrest within our workforce’.

Perhaps the DfT hopes that by having DOR manage East Coast it will make the nationalised operator look sufficiently arms length.

A worth while use of taxpayers money to save ministerial blushes?

UPDATE: This from Anonymous 2...

There was a robust justification for Barbie Rail, by Rail Barbie. in the Guardian on Friday.

Although reading the article it seemed to be all about East Coast rather than Directly Operated Railways.

Are they perhaps related?

Villiers vignettes... not us Guv', talk to DOR...

Tom Harris may not have a Shadow ministerial role but he is still more than able to expose nonsense from the Government front bench.

This extraordinary written response to a Harris PQ given in the House yesterday:

Tom Harris (Glasgow South, Labour)
To ask the Secretary of State for Transport what plans there are for use of Pendolino rolling stock for service on the East Coast Main Line; and what assumptions were made about the availability of rolling stock when the East Coast Main Line 2011 timetable was being prepared.

Theresa Villiers (Minister of State (Rail and Aviation), Transport; Chipping Barnet, Conservative)
We are aware of discussions that Directly Operated Railways have had about the use of a new Pendolino set on the east coast main line. This is an operational matter for Directly Operated Railways.

Additional rolling stock is not required for the operation of the May 2011 east coast timetable, which has been developed on the assumption that it will be operated using the existing east coast fleet.

So Villiers and her officials are claiming that the discussions about commissioning a new Pendolino on the East Coast Main Line was all Rail Barbie's idea and her's alone?

Eye does not believe this for one moment.

It is inconceivable that these discussions could have taken place without support from the highest level within DfT - after all Marsham Street is paying for the new trains.

How quickly the Saviour of the Jammy Dodger has become complicit in DafT's machinations!

The future of rail... is bleak!

Telegrammed by Leo Pink
Flyers have just been circulated for the 2010 Future of Rail conference in mid November.

Closing the morning session will be a presentation by Elaine Holt on turning around the East Coast Main Line.

Among the questions she will be answering will be:

1) What action has been taken to turn the line around?
2) What is still to come?
3) What can other TOCs take on board from the East Coast experience?
4) What wider implications do the East coast events have for franchising in the UK?

For those who can't wait for the answers, or think the conference a little pricey, Railway Eye can save you £992.28 (including VAT)

The answers are:

1) Sack anyone with any experience (the Pol Pot strategy)
2) More sackings
3) Treat it as an awful warning
4) Treat is as an awful warning

Of course those really keen to know the future of rail post CSR could always attend the Derby and Derbyshire Rail Forum annual conference, headlined by Sir Roy McNulty on the 4th November, for the princely sum of £100!

East Coast - New Ops Director named

The management changes at state owned East Coast, that Eye alluded to on Friday, have now been announced.

This press release issued today:

MANAGEMENT CHANGES AT EAST COAST

Danny Williams has been promoted to the role of Operations Director at East Coast.

Mike Hogg, who has until now been responsible for Operations, has stepped down from his position and will be leaving the company.

Karen Boswell, Managing Director of East Coast, commented:

“I want to pay tribute to Mike Hogg for his dedication to the role over many years. His operational judgment has never been in question at East Coast, and his knowledge and experience within our industry is highly respected.

“But the move comes as a result of our determination to make a significant step change in performance improvement – an area which has been challenging for our business over the last nine months. Working closely with Network Rail and other industry partners, I expect Danny Williams to tackle this challenge with renewed vigour.”

Michael Holden, Non-Executive Director of Directly Operated Railways, the parent company of East Coast, will work closely with Danny Williams during an interim period and will provide advice on the implementation of specific initiatives designed to achieve sustained improvement in operational performance at East Coast. Michael Holden has had a long and successful career in railway operational management since joining British Rail in 1978, including four years as Regional Director for the Southern Region of Railtrack, and then Network Rail. In 2003 he set up South Eastern Trains and was its Managing Director until it was re-franchised in 2006. Today, he specialises in providing strategic advice to the rail industry.

Before joining East Coast earlier this year, Danny Williams was Head of Trains Service for First Capital Connect (FCC). Here, he was instrumental in improving FCCs Thameslink train Public Performance Measure to 90% (Modified Moving Average) via a cross-functional ‘Destination 90’ initiative.

He led a driver management team that was responsible for the day to day operation of eight train-crew depots across the FCC business, and his extensive operational responsibilities also included safety line management, and the management of three control offices. Most recently he was Head of Customer Service Delivery for FCC, with 78 stations, and occupational safety also under his remit. Danny (36) has worked in the rail industry for 19 years, and in 2009 he was nominated ‘Young Professional of the Year’ at the Rail Business Awards.

Danny Williams and Michael Holden will take up their new positions with immediate effect.

ENDS

UPDATE: This from Steve Strong...

I note that Ms Boswell says that Mr Hogg's "operational judgment has never been in question".

Perhaps this explains why East Coast have decided they need to replace him with two people - at the taxpayers expense of course.

If double-manning is good enough for management then can it be long before Aslef demand a return to similar practices on East Coast footplates?

UPDATE: This from Mallard...

With East Coast performance languishing at the bottom of the PPM table isn't it about time that the government acted against this failing TOC?

I suggest that East Coast is immediately stripped of the franchise and that its operation is handed over to Directly Operated Railways which was set up for this very purpose.

Only in state owned hands can the franchise return to its former glory! (Is this right? Ed)

East Coast celebrates record breaking turnover

Is state owned East Coast becoming the rail equivalent of the Marie Celeste?

The company has only been nationalised for ten months and in that time there have been a flurry of departures through East Coast's revolving doors.

First there was the Engineering Director, gone!

Then the Commercial Director, gone!

Then the Head of Safety, gone!

Then the Director of Communications, gone!

And latest to join the exulted list is the Customer Services Director, now gone!

An impressive turnover of senior staff in such a short time to be sure.

What's more it would appear that the Operations Director is now "not returning calls"...

Can it be long before the Captain is obliged to go down with the ship?

UPDATE: This from our international correspondent...

Is the East Coast's slimmed down management due to natural wastage, or was it the prospect of the 'Barbie-lino' that caused the rush to the lifeboats?

The Engineering Director would have had to maintain a train for which all the spares and manuals are held by Virgin West Coast.

The Commercial Director would have had to explain why the train was financially underperforming every other service on the route, because the high speed dash to Scotland is deprived of intermediate revenue and would have to compete head to head with Easyjet, which effectively caps the fare at low cost airline levels.

Head of Safety would have had to sign the Get our of Jail Card for introducing a one off into an otherwise simple cohesive fleet (no doubt with memories of how unstraightforward the hired-in NoL Eurostar sets were).

The Director of Communications would find himself justifying an East Coast Pendolino to Captain Deltic, whose derision for the whole thing shines out of his latest column like a lump of Polonium. Just dishing out the usual mix of free tickets and platitudes may not be enough.

The Customer Services Director would have had to deal with all the public correspondence (why do you make us travel in such a rattly train? What is that terrible pong coming from the loo? etc...).

And it cannot be a surprise that the Operations Director is, ahem, unavailable...since he would have to actually run the bloody thing...

UPDATE: This from Mallard...

You may be amused to know that East Coast have now banned access to Railway Eye from its IT network for being 'inappropriate'!

The railway equivalent of sticking your fingers in your ears and shouting "La la la la la - I can't hear you!"

Virgin's view of Barbielino and Eastern Promise

Clearly confusion reigns over today's exciting announcement from Directly Operated Railways about plans to operate 'Barbielinos' on the ECML.

Virgin were clearly unsighted on DOR's plans as this statement, released yesterday afternoon, by Virgin Rail Group reveals

"We have no knowledge of any plans to use new Pendolinos on East Coast and have not been asked for any advice. The new Pendolinos were ordered for the West Coast based upon a robust business case and are due to start arriving in the UK later this year.

“As has already been reported, we have made a proposal to the DfT to seek an extension to our West Coast Franchise and one of the many benefits would be to assist the DfT with the tricky integration of new vehicles and offering options to put the new 11-car trains into revenue earning service earlier than previously envisaged, to provide maximum capacity before and during the Olympic Games in 2012.

“We cannot go into too much detail as this is still a matter between us and the DfT, but we can confirm broadly that our plans are to put the first new Class 390 on Scotland - Birmingham services in 2011, of which many are now full and standing (nearly half of all trains on Fridays and Sundays). Then we would extend the trains to London, restoring some direct Milton Keynes - Scotland links, and free-up a Super Voyager to start a new service linking Manchester with Heathrow ( Hayes ). Another set would also enable hourly London - Glasgow services throughout the day by the end of 2011.

“Furthermore, we have developed a new business case that pays for the placing of an order for another 42 vehicles, at no additional cost to Government. This would bring the complete Pendolino fleet of 56 trains up to 11-car with 2 additional standard class coaches per set.

“We are sure the DfT will not dismiss out of hand our revenue earning proposals over an experiment on the East Coast and we are just waiting to discuss our proposals in more detail.

"Given the record rates of growth we seeing on our West Coast services (three times higher than the East Coast) we really need to get the trains and cars into service as soon as possible to handle the growing passenger numbers without worsening overcrowding."

Eye understands that the DfT press office were also unaware of the DOR release until it popped into their inboxes this morning.

Not bad considering that DOR is part of the Department for Transport.

Three Railway Eye cheers for joined up government!

UPDATE: This from Our Man at 222 Marylebone Road...

Virgin say: “We are sure the DfT will not dismiss out of hand our revenue earning proposals over an experiment on the East Coast and we are just waiting to discuss our proposals in more detail."

Virgin mean: 'We put in our proposals yonks ago and from the deafening silence it's pretty clear that DfT Rail is continuing its vendetta against us despite the change of government.'

UPDATE: This from Jumbo...

Is there any circumstance in which Virgin could resist telling us how good they are?

With investment of over £10 billion on the West Coast, and a massive increase in the train service, it is no wonder that growth is three times higher than on the East Coast.

Still with all their exciting plans, no doubt the DfT can expect Virgin to offer lots of lovely lolly in premium payments in the near future.

But is it too soon to tell Sir Roy McNulty?

UPDATE: Ithuriel responds to Jumbo...

As any fule kno, DfT Rail felt that it had been taken to the cleaners by those nasty capitalists at Virgin when the revised West Coast franchise deal was struck.

Virgin even sweet-talked the gullible civil servants into early eligibility for revenue support under cap and collar (Like those public spirited entrepreneurs at First Group?. Ed).

But despite Virgin's worst efforts, ridership and revenue is booming, so that it is all cap and no collar on the West coast and the public purse is taking 80% of earnings over the revenue profile in the revised franchise agreement.

Meanwhile East Coast is still relying on the collar.

Clearly DfT Rail believes that no commercial good deed should go unpunished

Public servant commits career suicide - Shocker

Whilst the new government warns that transport will not be immune from swingeing spending cuts it appears that not all civil servants are on message.

This from The Journal...

Elaine Holt, chairman of state-owned rail company East Coast, told The Journal new trains were needed to cope with rising passenger numbers and the needs of travellers in the coming years.

Presumably Elaine's new boss, Philip Hammond, will shortly be summoning her for a meeting, sans coffee?

First for not running trains

Eye wonders if Elaine Holt might have any spare time between now and the 13th November to fix a small problem.

Apparently her old TOC isn't running any trains on the Great Northern route this Sunday.

Something to do with driver shortages.

Surely they haven't all been recruited by DOR as well?

UPDATE: This from The Sussex Driver...

FCC are indeed short of drivers at the moment, both on the GN and Thameslink routes.

This is being compounded by First Group awarding the driving grade a 0% pay rise, backdated to April!

As I'm sure you'll appreciate, the brothers aren't exactly best pleased, and have told them to shove rest day working up their siding, hence no GN services this Sunday.

Last Saturday evening it was buses between Bedford and London because of the shortage, and so far there have been over 100 services cancelled on the Thameslink route in the last two weeks.

DOR caught on hop by Adonis NXEC decision

Telegrammed by our man at 222 Marylebone Road
Directly Operated Railways seems to have been taken by surprise by the decision to bring forward the termination date of the National Express East Franchise by a month.

Until this week DOR was working on taking over at the timetable change on 13th December.

Now it is 13th November - just over a week away.

Had they had a subscription to the Orange Peril, otherwise known as Rail Business Intelligence, they would have found on the City Page of the October 29 issue an erudite analysis of the NXEC burn rate.

This showed that the franchise was losing £1.27m a week and had £6 million left in the kitty as of 30th September.

So it was pretty clear that NXEC was going to run out of money well before 13th December.

Perhaps DOR was hoping that all those cheap advance purchase tickets NXEC has been flogging would boost revenue - despite other operators experience showing it hammering the revenue line.

UPDATE: This from Charles Yerkes...

DOR still appears to be caught on the back foot judging by their website.


It still has no mention of the momentous news...

UPDATE: This from Lobby Fodder...

I'm not surprised that DOR has been caught out.

There were 'animated discussions' and raised voices late into last night, between party spin doctors and Treasury officials, over how the renationalisation was to be portrayed.

Judging from today's low key announcement the Treasury won.

ECML to be redacted - Shocker!

An excited press release from the RMT announcing the end date of NXEC!

Of course Rail Business Intelligence and Eye readers already know that the Department plans to nationalise the East Coast franchise at timetable change.

No matter.

Railnews gives further details of the leaked document which alerted the RMT.

The piece also contains a rather natty mock up of a Mk3 in its state owned livery.

Sadly the new East Coast logo may alarm the good burghers of Lincoln and Harrogate.

And come to that the citizens of Leeds as well.

Apparently, under state control, the ECML is to become a siding!

To be fair the logo was probably designed by the Department for Transport.

And what do they know about railways?

UPDATE: This from Leo Pink...

At least the logo is close to First Group purple.

UPDATE: This from our man at 222 Marylebone Road...

Shouldn't the new logo say 'InterCity East Coast' since Roger Ford's Manifesto is bound to be adopted after the election

DafT shows commitment to local democracy

This update on the Battle of the Barriers from the BBC...

A rail company is appealing against a decision not to allow ticket barriers at York railway station.

The appeal is apparently to be heard in the New Year, by which time NXEC should have shuffled off its mortal coil.

So there is precious little benefit to be gained by the franchise, NatEx or indeed its hard pressed shareholders in mounting this appeal.

So who is yanking NXEC's chain?

Step forward Lord Adonis, DafT and DOR.

Eye salutes this unholy triumverate for learning from Ireland's experience with the Euro constitution.

Just keep asking the same question until they come up with the right answer.