Great British Railways - what you need to know

Heard about Great British Railways but not sure what it is?  Here’s our recap of where GBR has come from, where it’s stationed currently, and where it might be destined with the upcoming election.

An overview 

Since it was first announced in May 2021, Great British Railways – the proposed public body that would take over and operate our national rail network - has sparked feelings of hope, confusion and disappointment for those in the rail sector.  

Meaningful rail reform has long been hoped for by passengers and those in the industry alike, and with the announcement of this new “guiding mind” for UK rail travel, it seemed as if reform may finally be delivered.  

Due to a combination of limited visible progress as well as concrete updates, expectations have lowered in 2024 that we are unlikely to see the originally promised “rail revolution”. However, with Labour now announcing plans to renationalise rail if elected, change may be back on the agenda.

Franchises and fiascos 

Change is on the agenda because of several structural issues. The British railway network is currently owned and managed by Network Rail, an arms-length body of the Department for Transport. While Network Rail manages the network at a national level, the network is divided into regional franchises or geographical areas, with 17 Train Operating Companies (TOCs) who are each responsible for managing services within their franchise. 

This franchising system has proved controversial. The fragmentation of the network into (mostly) private hands means TOCs have little control over the network as a whole, while any profits that are made tend to be directed to shareholders rather than reinvested in the network.  

This has severely impacted customer experience and TOCs have struggled to stay financially viable. Seven TOCs are currently government-operated after they became financially unable to operate services. This was also accelerated by the COVID-19 pandemic, with vastly reduced passenger numbers and higher costs having a severe impact on the sector. 

The pandemic also accelerated the need for broader reform. In May 2021, this arrived in the shape of Keith Williams’ and Grant Shapps’ Plan for Rail (“the Plan”). The key pillar of the Plan was the creation of Great British Railways (GBR), a new public body to absorb Network Rail and take over responsibility for managing the national rail network. 

The GBR plan 

The stated aims of GBR include improving the much-maligned current customer experience of passenger rail services, reducing bureaucracy through a streamlined organisational structure, and making it easier for the rail network to innovate.  

It has been claimed that the efficiencies this new structure will generate will save the network £1.5bn a year after five years. The Plan states fares will be simplified and better “value” provided, but it is not clear to what extent, if at all, cost savings would be passed down to passengers. 

As part of the shake-up, franchises would be replaced by Passenger Service Contracts, with private companies contracted to operate trains to the timetable and fares that GBR specifies, in a model more akin to that used by Transport for London. The hope is this will incentivise operators and give them greater commercial freedom to innovate. 

Rather than the 17 franchises in the current system, GBR would break down the network into fewer, larger regions. The regions would be given powers to make decisions and choose how to invest funds, including delivery of research and development. 

But overall, detail on how exactly GBR will operate has not been shared since the publication of the plan in 2021. 

What progress has been made? 

A GBR Transition Team (GBRTT) has been active since 2021, however there has been limited publicly available progress. Originally due to launch in early 2024, GBR was delayed in October 2022 when the transport bill that would have progressed the plans was abolished.

The King’s Speech in November 2023 referenced GBR, and the draft Rail Reform Bill was published on 20 February 2024, ahead of pre-legislative review by the Transport Select Committee. The Bill is light on pragmatic detail as to how passengers will be affected, and the late publication of the Bill has fuelled industry suspicions that GBR may not see the light of day, and certainly not under the current government.    

But perhaps all is not lost. In March 2023 it was announced that Derby would be the home of GBR headquarters, having beaten five other candidate cities in a public vote. Is this a sign that GBR may yet come to pass? 

Upcoming election - Labour enter stage left 

As part of setting out its agenda for the upcoming election, Labour announced plans in April 2024 to renationalise all passenger rail services within 5 years. While large swathes of the electorate and political commentators are excited by the proposal, the practical realities of Labour’s plan bear a lot of similarities to the GBR plan – for the passenger, at least. 

Under Labour, rail service contracts would come under the control of GBR, with centralised operation of services, timetabling and infrastructure maintenance introduced which they believe will drive significant efficiencies across the running the railway.  The bringing together of track and train will enable decisions to be made on an industry-wide basis, rather than prioritising the needs of individual organisations. Private operators would still be able to run some “open access” services, similar to how Lumo or Hull Trains currently operate. The main difference between Labour’s nationalisation plan and the current GBR plan is that under the Tory plan, GBR would award contracts to private companies to operate services, whereas under Labour, GBR would operate services themselves. 

The word “nationalisation” always carries political heft, one way or the other. While Tory plans to centralise control of Britain’s railways have stalled, the clear policy commitment exhibited by Labour, and its broadly positive reception, may gather enough momentum to deliver meaningful change in rail. The forthcoming election offers this new momentum. 

At Oaklin, we are passionate about the rail sector, digital railway and change. GBR presents a very real opportunity for the industry to transform for the better, and we look forward to helping our clients adapt to the future environment. If you would like to find out more about how Oaklin can help your business, please get in touch!