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CBI calls on government to act urgently on rail franchising

The CBI has called on ministers to act urgently in strengthening the rail franchising process, following an independent report demanded big changes to the system.

The Brown Review of the Rail Franchising Programme was set up by the government after the cancellation of the InterCity West Coast Mainline competition last year – headed by Richard Brown, Chairman of Eurostar.

He found that franchising is a fundamentally sound approach for delivering railway services but makes a series of recommendations to reform the way competitions are run, They include:

  • that the franchising programme should be restarted as soon as possible, but at a pace that both the department and the industry can sustain;

  • that franchise terms should be determined by the circumstances and size of each individual franchise;

  • proposals to strengthen and simplify the bidding and evaluation process for each franchise;

  • proposals for the financial and contractual structure of future franchises, including in relation to risk allocation and capital requirements; and

  • that the government should plan to devolve responsibility for further English franchises to the relevant authorities.

Rhian Kelly, CBI Director of Business Environment, said:

“It’s clear the franchising process needs strengthening, to give industry and the taxpayer value for money and restore public confidence – but time is of the essence.

“We need ministers to act urgently to get the three halted long-term franchise contracts back on track or firms in supply chains and rolling stock orders will suffer.

“The review is absolutely right to pinpoint weaknesses in management and procurement skills within central Government. Ministers and the civil service need to draw on industry’s expertise to make sure that the process is robust and past failures are not repeated.”

Notes to Editors:

The CBI is the UK's leading business organisation, speaking for some 240,000 businesses that together employ around a third of the private sector workforce. With offices across the UK as well as representation in Brussels, Washington, Beijing and Delhi the CBI communicates the British business voice around the world.

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