The UK government’s Transport Secretary Mark Harper has announced he will not renew or extend FirstGroup’s contract for the Transpennine Express (TPE) business at the end of the month.
This will bring TPE into operator of last resort (OLR) arrangements from May 28, 2023.
“The decision follows months of significant disruption and regular cancellations across Transpennine Express’s network, which has resulted in a considerable decline in confidence for passengers who rely on the trains to get to work, visit family and friends and go about their daily lives,” said the UK Department for Transport (DfT).
The decision is temporary and it is the government’s intention that TPE will return to the private sector.
Under operator of last resort, services will run as normal with no changes to tickets, timetables or planned services with the department committed to ensuring a seamless transition for passengers.
“Alongside the train operating company, the Department for Transport (DfT) has taken steps to improve services, putting the operator on a recovery plan in February and meeting with local mayors to discuss a way forward,” said the DfT.
“While some improvements have been made over the past few months, it has been decided that to achieve the performance levels passengers deserve, and that the northern economy needs, both the contract and the underlying relationships must be reset.
“While making the decision to bring Transpennine Express into operator of last resort, the department recognises that a significant number of problems facing TPE stem from matters out of its control.
“These include a backlog of recruitment and training drivers, reforming how the workforce operates and most notably, ASLEF’s decision to withdraw rest day working – preventing drivers from taking on overtime shifts and filling in gaps on services.
“The decision to bring Transpennine Express into the control of the operator of last resort is temporary and it is the government’s full intention that it will return to the private sector.
“In light of this, today’s decision will not instantaneously resolve the challenges being faced on the lines, but will provide an opportunity to reset relationships between the operator, staff, trade unions and passengers.
“As part of this and in response to stakeholders’ calls for action, the Transport Secretary has asked the Department for Transport to review services in the north to help drive efficiency and find better ways to deliver for passengers across the region.
“He also asks all interested parties including the northern mayors and Transport for the North to engage with the government on this work.
“The government continues to urge the union to call off upcoming strikes and the rest day working ban.”
Aberdeen-based FirstGroup said: “For a sustained period during the first year of the current contract, TPE posted its best performance results for a decade.
“However, in 2022 TPE’s service levels declined due to circumstances not wholly within the operator’s control, mainly the challenging industrial relations environment including the withdrawal of longstanding industry-standard overtime arrangements while undertaking unprecedented driver training requirements due to infrastructure upgrades.
“Following the introduction of an agreed recovery plan in February 2023, cancellations have fallen by approximately 40% and will continue to do so as more drivers become available over the next few months.
“The group is disappointed by the decision not to extend the National Rail Contract for TPE, given the investment and improvements we have made to the service over the years, which resulted in growing annual passenger numbers from 14m in 2004 to more than 29m before the pandemic.”
FirstGroup CEO Graham Sutherland said: “We have operated TransPennine Express and its forerunners since 2004, and are very proud to have served the communities across northern England and into Scotland, carrying millions of passengers and introducing new trains, new routes and more seats for our customers.
“Our team have worked extremely hard to improve services, including by recruiting and training more drivers than ever before.
“We have also worked closely with the DfT and Transport for the North on an agreed recovery plan as well as an improved offer on overtime working for our drivers.
“FirstGroup is a leading UK rail operator with a strong and diversified portfolio. Today’s decision does not alter our belief in the important role of private rail operators in the delivery of vital, environmentally-friendly transport for customers and communities across the UK.”
FirstGroup said that in FY 2022, TPE contributed £415.8 million of revenue to the group’s total of £4.591 billion, £13.2 million of adjusted operating profit and £8.9 million of attributable net income.
“The management fees and performance fees for the period April 2022 to May 2023 will be settled following the finalisation of the completion accounts after handing the franchise to the Operator of Last Resort,” added FirstGroup.
“It is not anticipated that the group will incur material costs transferring the operation to the Operator of Last Resort.”