No, Grant Shapps didn’t promise to scrap the Northern Rail franchise

A train approaches Manchester Airport, 2015. Sadly not a Northern one, but still. Image: Getty.

I was slightly dreading the return to work this morning. Weren’t we all, of course, but I was dreading it partly for my own extra esoteric reason. The first working day of the year is the day on which I need to write the “here’s what today’s rail fare rises mean” piece. This is inevitably exactly the same as the last three “here’s what today’s rail fare rises mean” pieces only with some slightly different numbers, and trying to think of something even remotely new to say was starting to make my teeth itch.

Today, however, I’ve been spared all that, very possibly on purpose (more on that below). Northern Rail, the Arriva-owned operator responsible for most of the north’s rail network, has performed absolutely abysmally over the last few years: timetable changes resulting in chaos, services cancelled in huge numbers, no end in sight, and so forth. This morning, on BBC Breakfast television – a place where, vexingly, we are going to have to get used to ministers making news now they’ve decided to ignore the Today Programme – transport secretary Grant Shapps strongly implied that he wanted to take its franchise away. Here’s the key quote:

It’s completely unacceptable to have a situation where trains just almost routinely don’t run to a routine, don’t run on time. I simply will not put up with that, and I’ve already kicked off that process and I’ll be saying more about it very soon... I will absolutely bring that situation to an end.

At that point, BBC Breakfast presenter Charlie Stayt pushed him on exactly what he meant, asking: “Are you saying your intention as TS is to remove the franchise from NR?” Shapps responded:

That’s right. In the autumn I wrote to necessary parties in this with what’s called a “request for proposal” – that’s simply where you say I’m going to take action. There are couple of ways that can go – one is to strip the franchise, one is to have a short-term contract. But yes, exactly as you’ve said, I’m simply not prepared to have the service on Northern to carry on as it is and I’m taking action.

The interview is being reported with headlines like (this from the Mirror) “Northern Rail set to be stripped of franchise after years of poor performance”. That’s probably over-stating things. That could happen – but there are legal hoops to be jumped through and other ways this could end, such as a short-term management contract, in which Northern is paid a set fee for a specific service, essentially giving the Department for Transport a greater level of control.

What’s more, the process Shapps describes actually began in October – and while this does seem to be a ramping up of the rhetoric, he didn’t explicitly say, for example, “I will kill that lousy rail franchise if it’s the last thing that I do”. (Politicians please note: I am available for freelance speech-writing.) The fact he choose to say it today might thus mean, as the RMT union suggested this morning, that the whole affair is intended to distract us from, well, the rail fare rises I’m not writing about right now.

Three other thoughts. Firstly, Northern is not the only iffy rail operator in the north: some key east-west services are provided by FirstGroup’s TransPennine Express. That’s also been doing a pretty poor job – which is why Henri Murison, director of the Northern Powerhouse Partnership thinktank, earlier called on Shapps to begin the franchise review process there too.

Secondly, it’s not obvious that a change in operator will make as big a difference as passengers might hope. There are structural constraints on the network, due to things like limited capacity at key stations or on key sections of track, or shortages of staff or trains. Some of those things could be alleviated by better management. Others will take money. Others still will require complicated engineering work that will take an annoyingly long time. So sacking Northern Rail may be a good thing, but that doesn’t mean it will magically sort out the north’s rail network.

Thirdly: Labour metro mayors Andy Burnham and Steve Rotheram have been calling for Northern to be stripped of its franchise for some time. They, though, don’t have the power to make that happen. Shapps does. The political imperative to move on this, in a “tanks on Labour’s lawn” kind of way, is obvious – which just makes it more baffling that Shapps’ famously competent predecessor Chris Grayling never even tried.

Oh, and those rail fares? They’re up by an average of 2.7 per cent, which is very slightly lower than the 3.1 per cent they went up last year and the 3.4 per cent they went up the year before. If you want to know what blog I would have written about them, here’s 2018’s. I would appreciate it if you stopped reading before the bit in which I suggest the problem could cost the government votes, however.

Jonn Elledge is the editor of CityMetric. He is on Twitter as @jonnelledge and on Facebook as JonnElledgeWrites


As EU funding is lost, “levelling up” needs investment, not just rhetoric

Oh, well. Image: Getty.

Regional inequality was the foundation of Boris Johnson’s election victory and has since become one of the main focuses of his government. However, the enthusiasm of ministers championing the “levelling up” agenda rings hollow when compared with their inertia in preparing a UK replacement for European structural funding. 

Local government, already bearing the brunt of severe funding cuts, relies on European funding to support projects that boost growth in struggling local economies and help people build skills and find secure work. Now that the UK has withdrawn its EU membership, councils’ concerns over how EU funds will be replaced from 2021 are becoming more pronounced.

Johnson’s government has committed to create a domestic structural funding programme, the UK Shared Prosperity Fund (UKSPF), to replace the European Structural and Investment Fund (ESIF). However, other than pledging that UKSPF will “reduce inequalities between communities”, it has offered few details on how funds will be allocated. A public consultation on UKSPF promised by May’s government in 2018 has yet to materialise.

The government’s continued silence on UKSPF is generating a growing sense of unease among councils, especially after the failure of successive governments to prioritise investment in regional development. Indeed, inequalities within the UK have been allowed to grow so much that the UK’s poorest region by EU standards (West Wales & the Valleys) has a GDP of 68 per cent of the average EU GDP, while the UK’s richest region (Inner London) has a GDP of 614 per cent of the EU average – an intra-national disparity that is unique in Europe. If the UK had remained a member of the EU, its number of ‘less developed’ regions in need of most structural funding support would have increased from two to five in 2021-27: South Yorkshire, Tees Valley & Durham and Lincolnshire joining Cornwall & Isles of Scilly and West Wales & the Valley. Ministers have not given guarantees that any region, whether ‘less developed’ or otherwise, will obtain the same amount of funding under UKSPF to which they would have been entitled under ESIF.

The government is reportedly contemplating changing the Treasury’s fiscal rules so public spending favours programmes that reduce regional inequalities as well as provide value for money, but this alone will not rebalance the economy. A shared prosperity fund like UKSPF has the potential to be the master key that unlocks inclusive growth throughout the country, particularly if it involves less bureaucracy than ESIF and aligns funding more effectively with the priorities of local people. 

In NLGN’s Community Commissioning report, we recommended that this funding should be devolved to communities directly to decide local priorities for the investment. By enabling community ownership of design and administration, the UK government would create an innovative domestic structural funding scheme that promotes inclusion in its process as well as its outcomes.

NLGN’s latest report, Cultivating Local Inclusive Growth: In Practice, highlights the range of policy levers and resources that councils can use to promote inclusive growth in their area. It demonstrates that, through collaboration with communities and cross-sector partners, councils are already doing sterling work to enhance economic and social inclusion. Their efforts could be further enhanced with a fund that learns lessons from ESIF’s successes and flaws: a UKSPF that is easier to access, designed and delivered by local communities, properly funded, and specifically targeted at promoting social and economic inclusion in regions that need it most. “Getting Brexit done” was meant to free up the government’s time to focus once more on pressing domestic priorities. “Getting inclusive growth done” should be at the top of any new to-do list.

Charlotte Morgan is senior researcher at the New Local Government Network.