The Mayor’s Rail Vision: investing in rail services in London

The Mayor’s Rail Vision sets out his plans to improve London’s transport network. The document proposes a new approach to managing rail services and providing greater value for fare and tax payers’ money.

How the railways are currently managed

Transport for London (TfL) oversees almost all of the capital’s public transport network, but not the city’s railways. They are the responsibility of central government. 

This distinction means customers are faced with a confusing mix of ticket options, fare prices, service quality and travel information. It is the train operating companies that typically provide the lower level of service and greater complexity around fares and tickets.

The Department for Transport’s (DfT) existing franchising model is currently under review. It rightly says that there is no ‘one size that fits all’. Commercial incentives are generally weak for inner-suburban railways, so the standard contract is often not appropriate. 

These circumstances have impacted on how these railways were run prior to the establishment of London Overground. The previous rail company’s focus was on reducing costs, rather than developing higher quality, high capacity services. As a result our railways are not meeting their full capacity. The new infrastructure coming into effect over the next decade may not reach its full potential.

TfL’s London Overground offers a different model that is both cheaper to manage and more efficient. The opportunity exists to spend less on train operators’ “risk premia” and instead offer financial incentives to provide the high quality services passengers want. This is essential to the success of London Overground.

The alternative to the status quo

The Mayor’s Rail Vision sets out that alternative. Responsibility for London’s inner-suburban rail services should be devolved to the Mayoralty. That way a single coherent vision for the city’s railways can be made real. 

Gross savings of £100m over 20 years could be achieved from the Southeastern and West Anglia franchises alone with a more efficient model in place. TfL would plough that back into improvements at more than 100 stations, bringing them up to superior London Overground standards.

Vital to London’s economic prospects

London’s inner-suburban railways are the workhorse of much of the capital’s economy. Investment in this area often leads to high levels of growth and job creation, crucial to the economies of both London and the UK. And yet despite its importance, a plan for additional capacity is yet to emerge.