Private finance will bring big benefits for passengers
in a deal signed today between the SRA and M40 Trains, the owner of the
Chiltern Railways franchise. Chiltern Railways will continue to run the
service, which provides trains from London Marylebone throughout the M40
corridor to Birmingham, for up to 20 years. The agreement, which will
lever in up to £371million of private finance over the length of the contract,
will deliver increased capacity on the route and major benefits to passengers.
A significant proportion of the investment package has been contributed
by M40 Trains shareholder John Laing and the Royal Bank of Scotland.
SRA Chairman Richard Bowker, said:
" This is another good example of the private sector
expressing confidence in the rail industry's long term future. The agreement
with M40 Trains will deliver increased capacity, both through infrastructure
and rolling stock improvements, as well as improvements to stations and
in customer service geared towards creating a 21st Century railway. Passengers
can look forward to more seats, more trains, and a better all round journey
"In our Strategic Plan we stressed the importance of
delivering increased capacity in London and the South East, and today's
announcement will play its part in achieving that. Moreover, it will see
the further development of the Chiltern route to Birmingham as a real
alternative to the congested M40 motorway for business and leisure travellers,
helping to deliver the modal shift envisaged in the Government's Ten Year
Chiltern Railways are now contracted to deliver a number
of improvements Highlights include:
- Restoration of double track between Bicester North and Aynho Junction
to be commissioned in August 2002. This will remove the last single
track bottleneck between London Marylebone and Birmingham Snow Hill,
and enable an enhanced and more reliable timetable to operate. This
will provide an alternative route for passengers travelling between
London and the West Midlands whilst engineering work is taking place
on the West Coast Mainline.
- 15 out of 16 trains to arrive at their destinations punctually and
reliably - to be achieved from December 2003 (exceptions may be granted
where infrastructure enhancement work is being undertaken);
- A programme for the delivery of 15 additional vehicles between September
2002 and May 2005 and a full refurbishment of all existing Class 165s
for completion during 2004. This is in addition to 7 vehicles which
are currently under construction. There is also a requirement to deliver
as much additional rolling stock as is needed to meet demand - up to
- Platform extensions at 13 stations to cater for longer trains to
be delivered in two phases - starting in May 2002. More will follow
when demand requires;
- Construction of a new depot in the London area, and extension of
the existing depot at Aylesbury - to achieve better train reliability;
- Operation of through services between London Marylebone and Kidderminster
from September 2002;
- A station improvement programme including customer information systems,
enhanced passenger security, improved facilities for disabled passengers,
and better accessibility to stations;
- Reopening of two new platforms at Birmingham Moor Street station;
- A commitment to undertake the project management of a train protection
pilot scheme on behalf of the industry in response to the recent Uff/Cullen
report - subject to agreement from Railtrack.
- Chiltern have committed to implement infrastructure upgrades in the
London area, and between High Wycombe and Bicester North, which will
allow more trains and improved journey times, subject to funding being
available on acceptable terms. The funding of this scheme will be raised
through a Special Purpose financing Vehicle (SPV) on which development
work will take place over the next year.
- A project to reduce journey times and increase train frequency on
the Metropolitan route between Marylebone and Aylesbury via Amersham
will be developed and considered in March 2005 - in the light of the
routing of Crossrail, and the SRA's priorities;
A package of potential future schemes is included in the contract, which
might be developed further in the next few years. Included are infrastructure
improvements between South Ruislip and High Wycombe, and other ideas for
the longer term such as new parkway stations, the development of new routes,
and a local service in Greater London - provided capacity is available.
Notes to Editors
1. In August 2000, the Authority selected M40 Trains Ltd as the preferred
Counterparty, and agreed Heads of Terms with them for the replacement
of the Chiltern Railways franchise.
2. In March 2001 the SRA entered into a Deed of Amendment to the original
Franchise Agreement with M40 Trains to include in the contract a number
of significant improvements to the current Chiltern Railways franchise,
given that, due to post Hatfield effects on the industry, it was taking
much longer than expected to reach the point where the parties, including
Railtrack, could commit to a new long-term franchise.
Following the Deed of Amendment, further issues have arisen, which
have made the contents of the new Franchise Agreement different to those
contained in Heads of Terms. The bulk of the alterations to both dates
and content since Heads of Terms have been caused by:
- The changed circumstances of Railtrack, meaning that they are no
longer able to finance enhancement investment;
- the changes in the industry following Hatfield;
- the lack of available signalling resources, and
- SRA affordability constraints.
3. A 20-year franchise would require delivery of all the Contracted
Improvements, Planned Developments, and delivery of a substantial
package of the Future Proposals to ensure that investment continues
through the franchise term with significant passenger and strategic
transport benefits. If no future proposals are committed by year 2005,
then the franchise term would shrink back to 12 years. If the Bicester
North-High Wycombe and London infrastructure upgrade cannot go ahead
- for example, if it could not be financed on acceptable terms, then
following a Special Output Review the SRA has the option to shrink
back the franchise length to 10 years.
4. The £371m capital investment figure assumes that the High Wycombe-Bicester
North and London area infrastructure upgrade will go ahead funded
by SPV finance on acceptable terms. The £371m figure also assumes
that a further 131 new vehicles will be required over and above the
existing 118 vehicles already in service and 7 under construction.
This will take the fleet size to 256 vehicles by 2022 - which will
be required to meet the forecast demand. M40 Trains are contractually
committed to ordering 15 new vehicles irrespective of demand, and
are contractually committed to ordering the further 116 if demand
requires them, which it is forecast to do.. The £371m figure does
not include the value of implementing any Future Proposals, nor does
it include the value of implementing the London Marylebone-Aylesbury
via Amersham infrastructure upgrade - because neither of these are
firm contractual commitments at this stage.
5. The operation of additional trains is subject to the Rail Regulator
granting additional access rights.
6. Chiltern Railways achieved an 89% overall satisfaction level in
the Autumn 2001 National Passenger Survey, the highest rating amongst
all train operating companies.