Tentative steps made towards governance of franchise executive

 

Further details about the devolution of local rail services in the North of England have been disclosed, with plans for an executive board that would bring together PTEs and local authorities from across the region.

Last month the Department for Transport approved a seven-month extension to the Northern rail franchise that could ultimately see it combined with the TransPennine Express franchise, with management and procurement devolved to a new regional franchising authority (PT032).

The proposed governance arrangements, which have been drawn up by local authority chief executives in Greater Manchester, West Yorkshire, South Yorkshire and York, would see these “founding members” take on the financial risk of the franchise with voting rights on an executive board.

The executive would also have non-voting members drawn from North of England local authorities unwilling to take on the financial risk. The DfT could also have a minority voting role on the board and represent non-voting members, but it is understood that the DfT has indicated that it wishes to minimise its ongoing role in the management of the franchise.

David Leather, chief executive of Transport for Greater Manchester, told councillors last week that not every local authority would be willing, or able to assume the financial burden of risk from the franchise, hence the two-tier approach to governance.

He said that in order to reduce risk exposure, the new contract would run for a period of seven years, with the option of a three-year extension. This would allow the franchise board to gain a better understanding of the financial, operational and investment requirements of the franchise.

However, the decision on whether to proceed with management of the franchise depends on the financial settlement offered by government. Leather said that financial negotiations surrounding the financial aspects of the planned devolution will commence in the autumn.

 

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