The Plan for Rail set out a new commercial model for the railway, proposing to replace franchises with a new set of 'Passenger Service Contracts'. These would be built on the concession model, which has been used successfully to deliver train services by TfL and across Europe.
The Department for Transport undertook market engagement on the design of those new contracts. In this response, Rail Partners set out that government should:
• Ensure a balanced risk and reward profile in PSCs;
• Develop a simpler procurement process enabling a significant reduction in the cost of bidding;
• Require significantly lower capital requirements and bonds compared with franchising that reflect the risks passed to train operators;
• Ensure that the outcomes to be delivered by train operators are consistent with the levers and incentives they have; and
• Ensure that the key commercial, innovation and delivery expertise of private sector owning groups and operators are harnessed to the full.
