Structure of the rail industry in the United Kingdom
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UK railways are in the private sector. As such, they are not controlled by central government, although they are subject to economic and safety regulation by arms of government.
Infrastructure is separately owned and operated - by Network Rail - from the trains which use it.
Passenger trains are run under either franchises from the Department for Transport or on an open access basis, which means their operators have no contract with government. Freight train operators have no contracts with government, and rely on the competitiveness and attractiveness of their product and services to maintain and increase their market shares.
Rolling stock is largely owned by rolling stock leasing companies - ROSCOs.
In 2006, using powers in the Railways Act 2005, the Department for Transport took over most of the functions of the now wound up Strategic Rail Authority. The DfT now itself runs competitions for the award of passenger rail franchises, and, once awarded, monitors and enforces the contracts with the private sector franchisees. Franchises specify the passenger rail services which are to be run and the quality and other conditions (for example, the cleanliness of trains, station facilities and opening hours, the punctuality and reliability of trains) which the operators have to meet. Some franchises receive subsidy from the DfT for doing so, and some are cash-positive, which means that the franchisee pays the DfT for the contract. Some franchises start life as subsidised and, over their life, move to being cash-positive.
The other regulatory authority for the privatised railway is the Office of Rail Regulation, which, following the Railways Act 2005, is the combined economic and safety regulator. It replaced the Rail Regulator on 5 July 2004.
[edit] References
- National Rail Trends 2003-2004 quarter three, from the Strategic Rail Authority. (Warning: PDF format)
- DfT Transport Ten Year Plan 2000 from the UK Government Department for Transport.
- Network Rail - Making a Fresh Start - National Audit Office report, 14th May 2004. (Warning: PDF format)
