30 Apr 2012 07:00
Stagecoach Group plc
STAGECOACH SOUTH WESTERN TRAINS FORMS ALLIANCE WITH NETWORK RAIL
Stagecoach Group plc ("Stagecoach") is pleased to announce that its subsidiary, Stagecoach South Western Trains Ltd ("SSWT"), has signed an agreement with Network Rail Infrastructure Ltd ("NRIL"), entering into an alliance to deliver rail services in the south and south-west of England.
A single senior joint management team is now responsible for both train and track on the Wessex route operating out of London Waterloo with the aim of delivering a better service for passengers and a more efficient, lower-cost railway through more collaborative working, better decision-making and fully aligned incentives.
The alliance, a first for the UK rail industry, has been formally approved by the Department for Transport ("DfT") and the Office of Rail Regulation ("ORR").
Sir Brian Souter, Chief Executive of Stagecoach Group, said: "This new model is a real opportunity to deliver change that will benefit both passengers and taxpayers and support our objective of growing the railway.
"Safety will continue to be our top priority and will remain at the core of the way we run the railway. In addition, by working more closely with Network Rail than ever before, and with aligned incentives, we can deliver a more customer-focused and more efficient railway for the long-term."
David Higgins, Chief Executive, Network Rail, said: "This marks a new phase in the evolution of Network Rail as we continue to push decision making away from the centre, empowering our front-line managers to run the railway more effectively, and forging closer working relationships with our customers, the train operators.
"Network Rail will continue to focus on delivering our obligations to all parties, protecting the interests of all customers whilst maintaining the seamless operation of the whole network."
The alliance has been set up to run until 4 February 2017, the expiry date of the SSWT franchise agreement.
Background and key principles
The alliance is consistent with the objectives of the McNulty Report of 2011 to reduce inefficiencies in the UK rail system, as well as the aspirations in the Government's Command Paper of March 2012, which signalled encouragement for closer co-operation between operations and infrastructure. Strong health and safety systems currently in place at SSWT and NRIL will remain under the alliance. A detailed organisational change and safety validation process has been undertaken, with independent scrutiny and ORR involvement. All aspects have been satisfactorily concluded.
The alliance builds on the existing joint working between SSWT and NRIL through the Wessex Integrated Control Centre at London Waterloo, which co-ordinates the operational response to incidents on the route, as well as recent moves by NRIL to devolve operational responsibility to regional units.
Both SSWT and NRIL will seek to achieve improvements to performance and customer service through the new structure. The combined management team will consider the "whole railway" perspective in making decisions on matters such as management and timing of infrastructure work and response to disruption.
The alliance will have responsibility for the safe, reliable and punctual operation of the Wessex network and SSWT services; maintenance of the Wessex infrastructure assets; maintenance, cleaning and servicing of the SSWT train fleet; and the operation and maintenance of all stations on the Wessex network.
Key principles of the alliance are:
• Both SSWT and NRIL will remain separate entities
• Employees will continue to have the same employer
• No changes to employee terms and conditions of employment or collective argaining agreements with recognised trade unions
• Each company continues to be ultimately accountable for its own areas of responsibility
• The interests of other passenger rail companies and freight operators are protected
Executive management team and governance board
The alliance senior management team will be headed by Tim Shoveller, currently Managing Director of Stagecoach South Western Trains. The executive team has more than 200 years' experience in the UK rail industry covering train service delivery, rail infrastructure management and train fleet manufacturing. It includes:
• Managing Director - Tim Shoveller
• Infrastructure Director - Jim Morgan
• Operations Director - Mark Steward
• Fleet Director - Christian Roth
• Safety & Assurance Director - Brian Cook
•Human Resources Director - Kelly Barlow
• Commercial Director - Sam McCarthy
• Customer Service Director - Jake Kelly
• Finance Director - Andy West
A governance board, with equal representation of both organisations, will oversee the operation of the alliance and take major business decisions.
Financial arrangements
The alliance includes an agreed financial baseline for the costs andrevenues of its activities, with cost savings and other out-performance relative to the financial baseline being shared equally between SSWT and NRIL. The agreement also includes a "taxpayer benefit" whereby the DfT takes a share of any financial upside generated by the alliance in excess of agreed financial thresholds.
ENDS
For further information, please contact:
Stagecoach Group plc
www.stagecoachgroup.com
Analyst enquiries:
Martin Griffiths, Finance Director 01738 442111
Media enquiries:
Steven Stewart, Director of Corporate Communications 01738 442111
Notes to Editors
Stagecoach Group
• Stagecoach Group is a leading international public transport group, with extensive operations in the UK, United States and Canada. The company employs around 35,000 people, and operates bus, coach, rail, and tram services.
• Stagecoach is one of UK's biggest bus and coach operators. Around 2.5 million passengers travel on Stagecoach's 8,100 buses every day on a network stretching from south-west England to the Highlands and Islands of Scotland. The company's business includes major city bus operations in London, Liverpool, Newcastle, Hull, Manchester, Oxford, Sheffield and Cambridge.
• Stagecoach is a major UK rail operator, running the South West Trains, Island Line and East Midlands Trains networks. It has a 49% shareholding in Virgin Rail Group, which operates the West Coast inter-city rail franchise.
• Stagecoach also operates the Supertram light rail network in Sheffield.
• In North America, Stagecoach operates around 2,700 buses and coaches in the United States and Canada. Budget coach service megabus.com links more than 70 key locations in North America. Stagecoach is also involved in operating commuter and transit services, as well as tours, charters, sightseeing tours and a small number of school bus services.
Wessex route
• The Wessex route is geographically similar to the South Western Trains network, which is one of the busiest commuter rail operations in Europe. The route serves the long-distance routes of London Waterloo to Portsmouth, Southampton, Weymouth, Salisbury and Exeter. The North Downs line links Reading and Guildford to Redhill/Gatwick Airport. The South West London commuter routes are divided into Main Line Suburban for the lines branching out to the east of the main line and the Hampton Court branch and Windsor Suburban for services to the west of the main line.
Stagecoach South Western Trains
• Stagecoach South Western Trains operates around 1,700 trains a day on a network in the south and south-west of England, carrying more than 200 million passengers a year. It serves more than 200 stations and employs around 4,500 people. SSWT operates around 80% of the total train miles run on the Wessex route. Other passenger rail operators serving stations on the route are First Great Western, Southern and CrossCountry. Rail freight operators also use the Wessex route, mainly to carry intermodal freight to Southampton Docks.
Network Rail
• Network Rail is the not for dividend owner and operator of Britain's railway infrastructure, which includes the tracks, signals, tunnels, bridges, viaducts, level crossings and stations - the largest of which we also manage It aims to provide a safe, reliable and efficient rail infrastructure for freight and passenger trains to use For further information, go to www.networkrail.co.uk