RMT Policy Briefing: Great British Railways Update – Railways Bill published
“We will put passengers at the heart of the service by reforming the railways and bringing them into public ownership. We will do this as contracts with existing operators expire or are broken through a failure to deliver, without costing taxpayers a penny in compensation. Great British Railways will deliver a unified system that focuses on reliable, affordable, high-quality, and efficient services; along with ensuring safety and accessibility.” LabourPartyManifesto,2024
The Labour Government came into power pledging to renationalise the railways and create a new, publicly owned company to run them called Great British Railways. This briefing updates RMT members on the government’s progress and the union’s response.
Introduction
On 5th November, the government published its anticipated Railways Bill.1 This is the second legislative stage in creating a publicly owned railway in Britain.
Just over a year ago, the government passed the Passenger Railways (Public Ownership) Act which gave the Secretary of State the power and duty to take franchises into public ownership as their contracts expired or passed their core terms. At the Labour conference in September, the Secretary of State used her speech to announce the next tranche of franchises to come into public ownership. By Autumn 2027, the aim is for all to be in public ownership.
Table 1: Remaining TOCs to be brought into public ownership.
West Midlands 1 February 2026
Govia Thameslink Announced for 31 May 2026
Chiltern Railways Summer 2026
Great Western Autumn 2026
East Midlands Winter 2026
Avanti West Coast Spring 2027
CrossCountry Autumn 2027
The Railways Bill represents the second stage of the process by creating a new legal entity, Great British Railways, which will be responsible for running the railways.
1 https://publications.parliament.uk/pa/bills/cbill/59-01/0325/240325.pdf
Great British Railways confirmed:
The Railways Bill has confirmed that the government will deliver on several key pledges from the pre-election policy document GettingBritainMoving. GettingBritainMovingsaid that Labour would establish ‘a new, arm’s length public body –‘Great British Railways’ –which will be a directing mind in charge of Britain’s railway infrastructure and services’.2 The document said that “track and train will be brought together so that decisions can be made on a whole-industry basis, with a single view across railway costs and revenue, rather than being driven by what is best for individual organisations.”3
The Railways Bill confirms that GBR will be a new, publicly owned company headquartered in Derby. GBR will run passenger train services (that the government currently procures from private companies such as Avanti and CrossCountry) and manage the infrastructure (tracks, stations, and depots) as Network Rail does today. This is ‘bringing track and train together’. Alongside this, GBR will make decisions about which other operators can run services on its infrastructure, as well as selling tickets for its services.
The Bill gives the Secretary of State the power to create a ‘body corporate’ as ‘Great British Railways’ through secondary legislation. Following Royal Assent GBR will be established by renaming Network Rail Infrastructure Limited, the asset owning company of Network Rail. Those private train operators who are still in existence at the time it is set up, alongside DFT Operator, Network Rail Limited and parts of the Rail Delivery Group will then be consolidated into the new body.4
The Bill also confirms the statutory role of devolved Mayoral Authorities in the railway:
“The Bill will create statutory roles for Mayoral Strategic Authorities in the railway reflecting a desire to bring decision-making as close as possible to local communities while recognising that – as a nationally integrated network – the railway’s governance must balance local, commuter, regional, national, international and high-speed services, as well as the role of freight.”5
The government’s intention is to encourage GBR to ‘agree partnership arrangements with mayoral strategic authorities (MSAs) to enable local influence over the railways and support integration with other transport modes.’
Issues we now know more about:
The Railways sheds more light on key issues for GBR including devolution, structure and funding, access to the network and accessibility.
1. Devolution:
2 https://labour.org.uk/wp-content/uploads/2024/04/GETTING-BRITAIN-MOVING-Labours-Plan-to-FixBritains-Railways.pdf, p. 6
3 https://labour.org.uk/wp-content/uploads/2024/04/GETTING-BRITAIN-MOVING-Labours-Plan-to-FixBritains-Railways.pdf, p. 17
4 https://publications.parliament.uk/pa/bills/cbill/59-01/0325/en/240325en.pdf
5 https://publications.parliament.uk/pa/bills/cbill/59-01/0325/en/240325en.pdf, p. 6.
As expected, the Bill will create a statutory role for the devolved governments, ensuring that national strategies are factored into GBR decision-making and GBR will be legally required to consult devolved governments before making certain decisions that will affect people or the economy in the relevant areas.6
The UK Government will be required to agree a memorandum of understanding with the Scottish and Welsh Governments setting out how the organisations will cooperate and share information. There is the potential for the relationship between GBR and the devolved governments to evolve to become closer if the devolved authorities wish, with the Bill giving Scottish Government ‘powers of direction and guidance over GBR, reflecting their role as funder in Scotland, when GBR is undertaking activities within Scotland on matters that fall within the executive functions of Scottish Ministers’. In Wales the Welsh government will retain responsibility for passenger services in Wales and the infrastructure on the Core Valley lines.
The documentation supporting the Bill states that the UK Government is committed to further integration between track and train in Scotland and Wales. Options will include a deeper alliance between ScotRail or Transport for Wales and GBR or a ‘corporate entity that would bring track and train management together such as a distinct GBR subsidiary or company jointly owned by GBR and Scottish or Welsh Ministers. The Scottish Government will retain responsibility for setting ScotRail and Caledonian Sleeper fares and have its own retail offer (GBR is bringing together the 14 UK Government managed online retail offers into one GBR offering). The Bill gives the Scottish government ‘powers of direction and guidance over GBR, reflecting their role as funder in Scotland, when GBR is undertaking activities within Scotland on matters that fall within the executive functions of Scottish Ministers.’7
2. Structure:
The Bill reveals a little more about the future structure of GBR. GBR will be based on geographic business units, each bringing together infrastructure management and passenger operations into a single local team, providing a locally focused ‘face of the railway’. However, to ensure a whole system approach, some functions will be retained centrally. This central part of GBR will set the strategic, planning and financial frameworks that the business units will operate within, aligned to a Long-Term Rail Strategy set by the Transport Secretary.8
3. Funding:
The funding of Great British Railways will retain many features of the current system with some new elements. The funding of infrastructure will be established through an amended periodic review system. There will be a new 5-year Funding Period Review for infrastructure. Under the new system,
“the ORR will set the timetable and deadlines. The Secretary of State will then issue
6 See https://publications.parliament.uk/pa/bills/cbill/59-01/0325/en/240325en.pdf, pp. 5-6; https://www.gov.uk/government/publications/railways-bill/railways-bill-devolved-and-local-government
7 https://publications.parliament.uk/pa/bills/cbill/59-01/0325/en/240325en.pdf, pp. 5-6.
8 https://www.gov.uk/government/publications/railways-bill/railways-bill-introducing-and-designing-greatbritish-railways
a statement explaining their objectives for the railway, and an estimate of the funds they will provide GBR to run it over the subsequent five-year funding period. The ORR will be consulted to provide their assessment of whether the funds and the objectives are aligned and practical. GBR will then produce a business plan in response. GBR must consult the Secretary of State, the ORR, and new Passenger Watchdog when producing this business plan. The ORR will advise the Secretary of State on whether the business plan achieves their objectives and represents good value for money. The business plan will then be formally approved by the Secretary of State and published, with updates made as needed.”9
The ORR’s role in this process is noticeably weaker than is currently the case.
However, there are two issues with the current proposal:
• Firstly, there is scope in the legislation for the Secretary of State to reduce funding if necessary within the Funding Period. This lessens certainty about funding over the Funding Period.
• Secondly, the Secretary of State’s power to fund GBR does not extend to passenger rail services. Instead, the Treasury will continue to make funding available to the DfT through the Spending Review allocations. This is justified on the grounds that there is ‘greater uncertainty of passenger services spend and income, due to changes in passenger demand which are difficult to predict.’ Materially, this means that GBR will find it difficult to predict its funding over a Funding Period and that the Treasury will retain direct control of part of GBR’s finances.
4. Access to the rail network and Open Access operators:
In a key change, the ORR will lose its function in granting access to the rail network. Instead, GBR will become the decision maker ‘choosing fairly between its own services, devolved services, freight services, and open access services’ . GBR will determine the duration and form of access rights, the charges other operators should pay for access (within parameters set by the Bill), and the design of performance incentive regimes which encourage other operators to run reliable services. The ORR will retain an ‘appeals’ role.
In a significant development, GBR will have to, at a minimum, charge the ‘cost directly incurred’ to cover the cost of running the service, subject to exclusions (for freight, for example). While Open Access will remain, therefore, at least for the duration of its current contracts, decisions over access will be removed from the hands of a market regulator and placed in the hands of an operator, with the power to charge the full costs of the railway to Open Access operators. This is likely to affect the Open Access business model, which relies on being sheltered from these costs for its profitability. By contrast, GBR will have a general duty to promote freight on the network and to set a rail freight target, recognising ‘the critical importance of freight to the economy and the environment’ . 10
5. Accessibility:
9 https://www.gov.uk/government/publications/railways-bill/railways-bill-how-the-government-plans-to-fundgbr
10 https://www.gov.uk/government/publications/railways-bill/railways-bill-making-best-use-of-the-railnetwork
GBR will have a general duty to ‘promote the interests of users and potential users of the railway (i.e. passengers and potential passengers), including the needs of disabled people’.11
Remaining key questions:
Some key questions remain about the structure of Great British Railways. While GBR will be a single organisation, uniting track and train as envisaged by Getting Britain Moving, it is less clear how the process of consolidating the various employers into one body will happen. The document implies that private TOCs, DFT Operator and Network Rail Limited, and all their employees, will be absorbed into Network Rail infrastructure Ltd. However, this is not spelled out in the Bill or accompanying documents. The union is committed to protecting the employment conditions of all members in the process of the creating Great British Railways and has written to the DfT requesting more information on how this process will work in practice.
The union also remains committed to protecting the jobs of our members currently employed at the open access operators. We have made clear to Government that these jobs should be incorporated into GBR as track access contracts expire or if any operators exit the market prior to this (which may be more likely if GBR were to levy increased track access charges on open access). RMT is seeking legal advice on whether existing legislation would provide for staff transfers in these cases or if further legislation is required, for instance through an amendment to the Railways Bill. There is precedent for similar provision with the 2017 Bus Act which extended TUPE and pensions protections to staff employed by standalone commercial operators when public service contracts were awarded under franchise to alternative operators.
11 https://www.gov.uk/government/publications/railways-bill/railways-bill-accessibility