Another train operator has been threatened with the loss of its franchise – adding to the impression that the entire system of awarding train-operating contracts is a shambles.

South Western Railway (SWR), which runs trains from London Waterloo to Surrey, Hampshire, Berkshire, Wiltshire, Dorset and Devon, has been judged “significantly below expectation” since it was given the franchise commenced in August 2017.

Passengers have endured months of strikes in a dispute with the RMT union over the role of guards – with only half the usual number of trains running throughout December.

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Now the transport secretary, Grant Shapps, has ruled that “the franchise is not sustainable in the long term”.

The firm, which is a joint venture between FirstGroup and MTR of Hong Kong, is criticised for “poor operational performance”. As with other failing franchises, revenue growth has been “significantly below expectation”.

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In a written statement, Mr Shapps said: “SWR have not yet failed to meet their financial commitments and my department will ensure that SWR are held to their financial obligations under the current franchise.

“However, as a precautionary measure, my department must prepare suitable contingency measures, under the Railways Act 1993.

“Such options include a new short-term contract with SWR, with tightly defined performance requirements; or transferring the operation to the Operator of Last Resort (OLR), a public-sector operator wholly owned by the department.”

The latter option is the same as currently used for LNER services on the East Coast main line.

Mr Shapps said: “This will not impact on the railway’s day-to-day operations. The business will continue to operate as usual with no material impact on SWR services or staff.

“Across the country a number of franchises are failing to provide the reliable services that passengers require and there are legitimate questions on whether the current franchising model is viable.

“Keith Williams – who is leading an independent review into the railways – has already stated that franchising cannot continue in its current form. His review will propose sector-wide reforms which aim to put passengers at the heart of the railway.

“Modernisation of the railways must come with reciprocal modernisation of the way the railway is operated. Passengers on SWR have already suffered significant disruption from industrial action.”


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