Press release

New rail franchise to deliver smart card tickets and encourage investment in better stations

This news article was published under the 2010 to 2015 Conservative and Liberal Democrat coalition government

Invitation to tender (ITT) on the Essex Thameside franchise.

The new 15 year Essex Thameside franchise will see passengers benefit from the introduction of smart card ticketing and provide important opportunities for private sector investment in improving stations, under proposals being put forward by Rail Minister Theresa Villiers today (2 July 2012).

The government’s invitation to tender (ITT) published today for the new franchise, will also give bidders much more flexibility to develop their own train timetable to better suit passenger demand.

Rail Minister Theresa Villiers said:

A more flexible franchise will encourage private sector investment, for example in improving stations. It will promote greater efficiency to drive down costs and also enable the train operator to react more flexibly to changing passenger demand.

The introduction of new requirements on passenger satisfaction will mean the operator has to focus strongly on the issues that matter most to passengers. Across the franchise, the roll out of smart ticketing will provide many more passengers with greater convenience and the sort of advantages already enjoyed in the capital.

The new franchise will run for 15 years from May 2013 to May 2028, with an option for the department to extend for up to 7 months.

Full repairing responsibilities of the 25 stations, including Fenchurch Street, will be transferred from Network Rail to the new operator.

The franchise agreement will ensure that a minimum number of stops at each station will be provided but gives bidders more flexibility to adapt timetables to cater for changes in demand. This should enable the future franchisee to run services in a more efficient way which is more responsive to the travelling priorities of passengers using the line.

New service quality targets have been set and based around stations, train services, train facilities and customer services. The indicators have been weighted to reflect local priorities and will be revised to capture any changes during the franchise.

Notes to editors

Details published of the new franchise that will take over from 26 May 2013, are set out by the department in an Invitation to Tender (ITT).

The invitation to tender follows a consultation designed to give the public and stakeholders a chance to have their say on what they wanted from the new franchise.

The proposed train service specification for the operation of Essex Thameside represents a relaxation from the rigid timetable specification of the past, while retaining obligations that protect the key outcomes for passengers and taxpayers, such as principal first and last trains and minimum numbers of station stops per week and per day. This marks a significant shift from the micro-management that has prevented operators from maximising capacity and optimising timetables to react to the changing demands of their passengers in the past.

The four shortlisted bidders to run the franchise from May 2013 are Abellio, First Group, National Express and MTR.

Bids for the franchise are expected to be received by 27 September 2012 and the new operator will be announced in January 2013. The new Essex Thameside franchise will run until May 2028, with an option for the department to extend up to 7 months.

When the government set out its plans on franchise reform, it acknowledged that each franchise contract needs to reflect the different characteristics of the lines and services it covers. Therefore the requirements set out in the Essex Thameside Franchise may not necessarily become standard terms in every subsequent rail franchise.

The ITT for the Essex Thameside franchise follows the current agreed regulated fares policy as set out in the 2011 comprehensive spending review - a rise in 2012 of RPI+1% and RPI+3% for 2013 and 2014, returning to RPI+1% thereafter. Over the long term we are committed to reducing the cost of running the railways and the goal of ending the era of above-inflation fare increases.

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