Martin Dean, managing director, business development at Go-Ahead Group, wants private sector expertise to retain a place in railway operation

 
There are differing views over how much credit the commercial train operating companies can take for patronage growth

 
The Go-Ahead Group is urging the government to ensure that the skills of the private sector are harnessed in the best possible way when the Williams-Shapps rail review is implemented.

Martin Dean, managing director, business development at Go-Ahead Group, said that his company welcomes the creation of Great British Railways and recognises the need for a more joined-up railway. But, speaking to Passenger Transport last month, he said “we want to be more than just contractors that carry out our instructions”.

Go-Ahead has published its own vision of rail. It calls for the creation of an incentive regime which focuses on growing passenger numbers as the railway recovers from the pandemic, drawing on train operators’ expertise in marketing and customer service, and encouraging innovation and better customer service.

It urges the government to continue to take advantage of the private sector model to drive down costs, draw upon a wider pool of expertise and open up access to alternative sources of capital. This includes the use of private sector expertise to anticipate, meet and respond to customer demand, owning the end-to-end customer interface in a way which makes operators best placed to understand and meet their need.

It also calls on the government to prioritise the role rail can play in tackling the climate emergency via modal shift and getting the railways to net zero carbon as soon as possible.

Dean acknowledged that the pendulum had swung away from light touch regulation. But he said that there was a question about how far it should continue to swing as the railways move into a new era.

We want be seen to be making the most of our skills because we have done a lot of work in the past about growing patronage

“We want be seen to be making the most of our skills because we have done a lot of work in the past about growing patronage,” he told Passenger Transport.

There are differing views over how much credit the commercial train operating companies can take for the doubling of patronage that took place after the railway was privatised in the mid-1990s. Some attributed this to private sector commercial focus while others pointed to exogenous factors, like the growth of central London employment.

Dean believes that the picture is mixed but he believes that roughly half of this growth can be attributed to the commercial nous of Go-Ahead and its peers.

“There’s incontrovertible evidence the patronage has pretty much doubled during the privatisation era,” he said. “There are definitely some things that we’ve done there in terms of focus on the customer that we would like to keep on doing.”

The Department for Transport seems certain to take back revenue risk from the private sector, but Dean believes that there are other ways to incentivise private sector train operators. He cites the example of Transport for London’s contracted bus services, for which Go-Ahead is the largest provider.

He explained: “I think it’s a really interesting parallel because you have got that overarching transport authority that specifies quite tightly and heavily but within that there is a very, very strong incentivisation regime and that does allow that innovation to come out.”

He believes that it’s important that the industry shares its view on what the new model for rail should look like.

I think it’s really important that we push in a positive way what the private sector has done.

“It’s clear that there are some gaps in terms of risks and rewards and who takes responsibility for what,” he said. “I think it’s really important that we push in a positive way what the private sector has done.”

He added: “We agree there should be a single guiding mind. We are right behind all of that … But it’s just where does the private sector fit within that? And with appropriate reward we would like to still take on some risk to make sure that we get the right sort of outcomes.

“We want to be more than just contractors that carry out our instructions. We think there’s a role for us to take a slightly broader look at things.”

 
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