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Deputy prime minister John Prescott today announced measures to boost investment in Britain's railways, put the pas...
Deputy prime minister John Prescott today announced measures to boost investment in Britain's railways, put the passenger first and ensure private operators provide high quality services.

And he pledged that, central to his vision would be a new priorities for the rail franchising director.

Mr Prescott said:

'We made clear when we took office that we would be dealing with the railways as we found them, not as we would like them to be. Since then we have sought real improvements in the railway, putting the public interest first and ensuring the industry provides the quality service which customers deserve. In the longer term, we will need to legislate to put our objectives into practice. But today's announcement marks a crucial first step towards a revitalised industry.

'We will be setting new objectives for the franchising director to signal a real shift in railways policy - putting passengers first. Private sector operators will face tough regulation to ensure they honour their commitments and justify the massive amounts of public money being pumped into the rail industry. But we will also be looking to develop a constructive partnership with them, encouraging investment and co-operation and making sure companies like Railtrack pull their weight. The new objectives signal our determination to see the rail industry grow and improve as part of an integrated transport policy.'

The franchising director's new objectives, to be published when parliament returns, will:

Put further franchising on hold. The franchising director will no longer be under an outright duty to privatise passenger railway services. Instead, he will be required to consult ministers before taking steps to re-tender any franchise.

Establish a new 'Rail investment' role for the franchising director.

The franchising director will be required to develop a partnership with local authorities and other potential promoters of rail schemes, providing advice and assistance to them, and considering whether

public funding should be used to support investment schemes which deliver wider social and environmental benefits for the community.

Make the franchising director more accountable. The new objectives make clear that, in enforcing contracts, the franchising director should put the interests of passengers first. Ministers will expect full briefings from him whenever serious breaches of franchise contracts are in prospect.

Safeguard passenger benefits. The new objectives will make it clear that existing passenger rights are not to be undermined. The franchising director will have new duties to promote facilities for disabled people and to improve passenger security. He will also be obliged to publish regular information about the operational performance of franchisees.

In conclusion, Mr Prescott said:

'The railways lie at the heart of an environmentally sustainable transport strategy, a fact which has become ever more obvious since we brought the departments of transport and environment together. After years of wasted opportunities, this government is committed to addressing Britain's real transport needs.

'Today's announcement is simply an interim first step. If we want to achieve all our objectives for rail, we will need radical reform. We are committed to establishing a strategic rail authority, with new powers to promote investment and regulate the railways in the public interest. Our proposals for the long term reform of the railways will be published next year, together with our vision for an integrated transport strategy.'


1. The franchising director is a semi-independent statutory officer, established under the Railways Act 1993 and charged with letting and managing franchise contracts for the passenger railway.

2. Under Section 5 of the Railways Act, the secretary of state has the power to give the franchising director a set of formal objectives, and to give him instructions and guidance on how these objectives should be fulfilled. The objectives, instructions and guidance (OIG) are a public document, laid before parliament. The most recent OIG was issued by the previous government, in November 1996. The new, revised version will be published when parliament returns after the summer recess.

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