2The Sustainable Branch Line

2The Sustainable Branch Line

In the preceding chapter we introduced the concept of ‘the sustainable branch line’. In summary, the sustainable branch line is a corridor based on the railway, providing high quality, community-controlled transport services which are safe, environmentally benign and socially responsible and supporting a diverse and complementary range of economic activities. Transport staff – including management and other personnel - are based locally, and the transport company is an active player in the local economy - as both an employer and purchaser of services and goods.

This chapter sets out a vision of what can be achieved through micromanagement, with rail acting as the spine of an integrated approach to sustainable development in rural areas.

The sustainable branch line should have:

• A train service which is run to meet the needs of the local communities along its route, as well as serving the needs of visitors – including evening services and all-year round Sunday operation
• A service which is accessible and affordable – the socially inclusive branch line!
• Feeder bus and taxi services meeting trains at key stations
• Good passenger facilities at stations, including staff
• Safe access for cyclists and pedestrians
• Good quality information on transport facilities and all other local facilities and activities/attractions for visitors arriving at stations; similar information available on line, and by phone.
• Station buildings which are built and operated on sustainable principles, are welcoming and full of life
• A service which is managed locally, and supports the local economy by providing employment and supporting other local businesses through local purchasing
• A train service which offers locally-produced goods for sale on its services, e.g. local food and drink, local crafts, guides, etc.
• A railway operation committed to sustainable principles, including energy use, recycling of materials, and making best use of its existing resources
• A railway operation which offers good value to the community for the financial support it receives
• The best – indeed probably only – way to achieve such a vision of a sustainable branch line is through local management and control – through micromanagement. The model which is most suitable to UK conditions pre-supposes a partnership between a local operator and an established train operating company, who would provide a quality check on its ‘little sister’ and ensure that safety requirements are fully adhered to.
• The development of a microfranchise or any decentralised operation needs to take into account the following range of issues:
• Operator
• Company Structure
• Service

-Customer Care

-Trains

-Stations

-Infrastructure

-Integration

• Social Inclusion
• Sustainability

Each of these impacts on the others, as we’ll see. By considering each in turn we can begin to see how a micromanaged railway could provide something quite different to what is currently on offer to users of rural rail services in the UK.

2.1Operator

Getting the right operator is critical, and there are a number of options. These are outlined below, and include a) small local private company b) an established major operator, c) a community-rail partnership, d) a heritage railway; e) a community transport operator; or f) a purpose-made company. Each has its own advantages and disadvantages. Whichever particular model is adopted should be within the framework of a structure which involves key stakeholders both within the community and the parent train operating company. This could be an existing or new community-rail partnership, or a purpose-made development company which works with the parent TOC to identify a suitable sub-contracted operator.

Local Private Company

Operating a rural branch line may be attractive to small or medium-sized companies based in the area, who have complementary skills. These could include a bus operator, other transport companies, or tourist-related businesses. Clearly, a local bus operator could add value by integrating its bus services with the rail operation and bring a strong local focus to the operation. Potential disadvantages include the small-scale nature of the operation and lack of access to capital for major development. This may not be a major disadvantage depending on the form the operation takes and the potential for tapping into local and regional sources of capital, including grants. Having a local company running the service is no guarantee of community involvement and it would be up to the franchising authorities to ensure this was built in to the specification.

A local company may have difficulty in accessing high level technical skills. Clearly, by being in partnership with a larger train operator this problem could be avoided.

Established major operator

In several European countries established operators, some based in the UK, are bidding for local franchises. Arriva has a 50% share in the Dutch NoordNed operation and will soon take over operation of some Danish ‘microfranchises’. French-owned Connexxion is involved in several Dutch and German ventures and is bidding for some German franchises. Island Line, as we shall see later, is a small franchise owned by a large company – Stagecoach. Some of the smaller UK franchises have been the most successful – notably Chiltern and Anglia. They could bring substantial expertise to running a small rural network, with the sort of ‘can do’ attitude which micromanagement needs to be successful.

The clear advantage of this option is that a large operator brings with it access to expertise and capital which a small company does not. It can share resources, e.g. rolling stock, staff and other expertise, between many operations. The down side is that a large operator may not be able to bring the strong community focus to an operation which some genuine locally-controlled railways, for example in Switzerland and Germany, can bring. There is a risk that a large company will simply win microfranchises on the lowest-cost basis and operate them in the same way that traditional state operators have run their rural lines. That need not be the case, and it would be up to the franchising authority to ensure that the line was operated and managed locally, with appropriate weighting in its assessment to ensure that operation really is local.

Community-rail partnership

There are around 25 community-rail partnerships in the UK. They have an excellent record of winning back passengers to rural lines through innovative marketing and community involvement. Could they extend their operations to actual service operations? Clearly they have developed considerable expertise in certain areas, but their partnership structure, involving local authorities, community groups and other agencies, may make them unsuitable for the task of actually running a commercial enterprise. Some partners could argue that they did not get involved in a community-rail partnership to run trains, but to support the rail service and promote its use.

A community-rail partnership could, if its members so desired, act as a supervisory body for an actual transport operation, providing political and community support and the sort of promotion which the partnerships already give to train operators. A community-rail partnership could develop into a local operator - but it would involve a major shift in direction for most rail partnerships.

A community-rail partnership which could become an operator is the Penistone Line Partnership, described in Chapter 8. It is a company limited by guarantee with an established reputation for promoting the railway in partnership with the PTEs and local authorities. Recently it has begun operating a modest rail-link bus service and is planning a catering service on some trains. This, at present, is done by volunteers. It does not have the capacity currently to run a regular bus service, but with the right funding and support it could extend its bus operations considerably. It is also in talks with Arriva on taking over the station cleaning and maintenance contract when the current contract expires.

It is possible to develop a scenario whereby such partnerships take on more and more ‘peripheral’ commercial activities and build up commercial expertise which – at a future stage – enables them to take on actual train operation. A model could be developed which is based on such a gradual progression:

1Operation of rail-link bus services and on-train catering

2Take over marketing of the service from train operator

3Further development of rail-link bus services, including PCV operations

4Taking on station cleaning and maintenance contract for the line

5Develop other commercial activities – station shops, tourism packages

6Station staff employed by partnership (minor stations only)

7On-train retail staff (conductors) employed by partnership

The pattern of development could vary from line to line. Track maintenance could be taken over by those partnerships with access to the right skills. It may – or may not – be appropriate for the partnership company to take over employment of on-train staff, whether conductors or drivers. There would seem to be a very strong argument for the conductor to be very much part of the local operation, rather than someone working through a complex link of other routes. The alternative option is a dedicated link of drivers and conductors for that particular route, employed by the parent train operator. This is currently the preference of the Penistone Line Partnership.

Getting the right mix of professional staff and volunteers would be an issue as much for partnership companies as for heritage railways. The general principle should be that ‘core’ jobs, including bus driving, on-train conducting and track or station maintenance should be the responsibility of paid staff. Volunteers can provide important back-up through ‘additionality’ – looking after station gardens, acting as conductors on the bus services, and assisting with catering services. They must be trained to the appropriate standard, have a strong safety awareness, and be subject to the same discipline as paid staff.

Heritage Railway

There are a number of cases where a well-established heritage railway is located near or adjacent to, a rural line with potential for micromanagement. Examples include the North Yorkshire Moors Railway (Esk Valley Line), Ffestiniog Railway (Conwy Valley Line), North Norfolk Railway (Bittern Line) and Bodmin and Wenford Railway (Cornish branches, including Looe).

In some cases, heritage railways have already expressed interest in being involved in micromanagement, and at first sight they seem an obvious choice. They have expertise in running railways, they have highly developed marketing techniques, and they are local. All major heritage railways have a number of paid staff, so the idea of managing paid employees is nothing new.
However, on closer examination some problems arise. Most heritage railways have a high level of member participation, which is undoubtedly a good thing. Yet the reason most active volunteers on heritage railways are involved is because they enjoy the thrill and romance of steam, or other heritage traction. A serious attempt was made to run ‘community’ services on the Keighley and Worth Valley Railway, in the mid-1990s, but it was ultimately vetoed by the membership, because it would risk spoiling the ‘heritage’ character of the railway.

Other railways have had aspirations to run ‘community’ services but haven’t moved forward very far. There is a real risk that any community operation would be viewed as a peripheral extra. Furthermore, a modern rural transport service has got to offer modern customer facilities. A ‘heritage’ diesel railcar would not be acceptable. In addition, many of the exemptions currently enjoyed by heritage railways under railway legislation could be lost if they were seen as becoming mainstream transport providers.

Probably the best way heritage railways could be involved is as partners (e.g. Esk Valley Railway Development Co.) rather than as leaders, or as ‘infrastructure authority’ where another operator runs the trains (Swanage Railways and West Somerset railway being two of the more obvious examples).

Community transport operator

The community transport sector has grown enormously over the last 10 years, and some operators now have turnovers of over £5 million a year. The image of a small, somewhat ramshackle organisation providing weekly trips for the elderly and infirm has long since vanished into history. Some of the bigger community transport operators are already providing tendered bus services, and diversification into local rail services could be an intelligent option for some of the bigger companies. They could bring enormous expertise and customer focus to rail operations, but would need to have partners with strong railway expertise – possibly a community-rail partnership.

Purpose-made company

Setting up a brand-new company to run a local rail operation would take time and patience. It would need to bring together appropriate expertise, develop a community presence and gain funding and financial backing. It is difficult to imagine such a scenario happening unless it is based on elements of the above options. For example, a local bus operator or other transport company (e.g. a company involved in railway engineering or other services) could team up with a rail partnership to create a new company with clearly defined commercial operating aims. In a sense this is what is happening on the Esk Valley Railway, where the former Esk Valley Rail Partnership is being re-integrated with other partners and companies to create the Esk Valley Railway Development Company. This is a ‘mutual’ company, owned and controlled by local community interests as a not for dividend company.

No simple solution!

There is no easy answer to the issue of whom the operator shall be. If there is clear encouragement from the Government it is fair to expect potential operators to emerge, as they have done in Sweden and Germany. In the case of Sweden, it was a local bus operator – BK – which broke the mould by challenging the might of Swedish State Railways. In Germany, DB’s monopoly has been broken by small municipal bus companies and some industrial railways. It would be encouraging to see one of the well-established heritage railways to move into this area, but the conclusion at present is that most are too focused on their core business (rightly or wrongly) to want to take on a major additional risk. The community transport sector has shown itself to be at the leading edge of transport innovation in the UK. Could it surprise everyone by becoming a genuinely integrated transport operator, running local rail, bus and more flexible demand-responsive services as part of a single operation?

2.2What sort of company structure?

It should not be assumed that the only option for company structure is that of a conventional private share-holding company. Within both the heritage railway movement, and community transport sector, there are several not-for-profit models which could be appropriate for a local operation. These include co-operatives, companies limited by guarantee and industrial and provident societies.

The most appropriate model could be the simplest – the company limited by guarantee. This involves active involvement of both workers and users of a service, with clear lines of accountability to a board of directors. Any profit (surplus) is channelled back into the company. Most community transport operations are set up on this basis, some now having a turnover in excess of £1 million per annum. They are highly successful enterprises and have not been unduly hamstrung by their not for profit status. They are motivated by ethical and social rather than commercial goals – of providing a valued public service which is accessible for all. There is absolutely no reason why the same approach could not work with a local railway.

The issue of whether such companies should become registered charities is not a central issue. Charities are subject to more constraints over what they can or cannot do, but can give a clear message that they are a company with charitable goals. However, a company limited by guarantee can still have the same ‘ethics’ as a formal charity

Such a company would need to have a board of directors representing key partners. It could include:

Local authorities

Local business community (e.g. entrepreneurs involved in tourism, catering, etc.)

Parish/town councils

Voluntary sector (e.g. rural community council)

Rail user group

Parent TOC

Infrastructure company (Railtrack)

The management team should be small, with a general manager answerable to the board of directors (trustees) and such other staff as appropriate (see elsewhere in this report, on appropriate staffing for EskValley, Looe, etc.).

The company limited by guarantee model, as applied to a local railway or wider transport operation, appears to offer considerable advantages in terms of winning community support, involving a wide range of partners, and access to funding. Already, a number of community-rail partnerships have adopted this model. The Esk Valley Railway Development Co. is a company limited by guarantee.

2.3Service

The service provided by a local operator should aim to meet the needs of all sections of the community, including residents and visitors. It will be faced with the reality of an existing service pattern which is resource-led, rather than customer-led. Changing that can be very expensive, and it will be important to focus on short-term improvements which can bring rapid results.