The legal framework for Great British Railways has been unveiled at last in the shape of the Railways Bill, which is to be debated at length during the Bill’s Second Reading in the House of Commons tomorrow (writes Sim Harris).

But if you want to know how GBR will work in detail, this Bill won’t help you very much.

We know the basics already: Great British Railways will be the industry’s ‘directing mind’, running most passenger services and managing National Rail infrastructure. The former franchises are now being renationalised one by one and being transferred to DfT Operator for the time being, until GBR can take over.

GBR will be licensed by the Secretary of State and regulated by the Office of Rail and Road, as Network Rail is now. In fact, Great British Railways will be the new name for a Network Rail which has gained powers to run passenger trains.

You will not find this in the Railways Bill, which does not even mention Network Rail, probably because Network Rail was not set up by an Act of Parliament in the first place. It was created by the government as a company limited by guarantee to take over from floundering Railtrack after it had entered Railway Administration in October 2001.

The name Network Rail will disappear, but as Parliament didn’t create the organisation, then Parliament is not needed to change it.

GBR will must work with the ministers of the Scottish and Welsh devolved governments and with Mayoral Combined Authorities, when its decisions are likely to affect their countries or areas (Sections 78-81). Similarly, it will also work with Transport for London (Section 82).

One familiar phrase not included in the Bill is ‘open access’, in spite of controversy over whether open access passenger services should exist, how useful they are and whether the terms of their access licences (particularly the network charges they are required to pay) are fair. But, as we discussed in Part 1, one clause in Section 71 seems to allow the Secretary of State to terminate existing access agreements, even if they were granted before the Railways Act was passed.

The whole question of open access passenger services has been placed in the spotlight by these reforms. When Labour won the 2024 election on a manifesto which included renationalisation of the former franchises, the private sector – which could see that it would soon be thrown off the rails after almost three decades – stepped up its attempts to gain open access licences, or extensions to those which already existed.

These attempts have had only limited success. Virgin Group did not win its bids for several new routes from London Euston, Alstom was refused permission for services between London Euston and Wrexham, and FirstGroup’s attempt to run between London Euston and Rochdale was turned down in July (although First has recently made a second bid for this route, claiming to have found the capacity it would need on the West Coast Main Line).

It has not been all bad news for open access supporters: First has gained track access rights to run trains between London Euston and Stirling, which will be routed east of Glasgow, and it also acquired an existing licence owned by Grand Union for services between London Paddington and Carmarthen. Other applications are still outstanding. Will any of them succeed?

For an indication of their chances, we can turn to a large collection of ‘policy papers’ and ‘factsheets’ which provide a more detailed picture of the Government’s intentions, and which were published at the same time as the Railways Bill.

The present Labour Government has never opposed open access passenger services in principle, but it has issued more than one cautionary message about them.

The first was on 6 January this year, when transport secretary Heidi Alexander told the ORR: ‘I am … aware of the additional pressures new services can create on already constrained network capacity and their impact on the value secured from public investment in infrastructure. While Open Access operators pay variable access charges to Network Rail to cover the direct costs incurred running their trains on the network, unlike government contracted operators they do not fully cover the costs of fixed track access charges.’

Some open access operators, like First, were quick to disagree. Later the same month FirstGroup said: ‘The success of Lumo … has seen it become the first open access operator to start paying the Infrastructure Capacity Charge alongside the Variable Usage Charge. This ICC cost has been ramping up since Lumo started operation and by 2025/26 it will be paying £5.20 per train mile. Comparing this to similar long distance operators and assuming no major changes in train miles, LNER will pay around 10 per cent less than Lumo and Avanti West Coast would pay 35 per cent less …’

These opposing views form the background to Section 71 of the Railways Bill. Arguments about comparative track access charges will soon be irrelevant (GBR trains running on GBR infrastructure will not pay them), but some more light is shed by the accompanying policy documents.

The factsheet ‘introducing and designing Great British Railways’ says: ‘GBR will make decisions about which other operators can run services on its infrastructure,’ while the explanatory notes which accompany the Bill say: ‘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.’

These two statements have changed the rules of the game. Until now, when an operator wants to run a service it must first apply to Network Rail, which then takes a view on whether there are enough spare paths. If it doesn’t think there are, it will refuse the application. The ORR and Network Rail can reach different verdicts, but the ORR is the final arbiter.

Once the Railways Act has been passed, the infrastructure owner and main operator will decide for itself who is going to be allowed to occupy its tracks and compete with its services, although a disappointed applicant will be able to appeal to the ORR (Sections 59 and 61).

But although the SoS may have powers to terminate track access contracts early, the factsheet ‘Making best use of the rail network’ offers some comfort: ‘The government will preserve the existing access rights held by operators – specifically the Schedule 5 rights required to run services – until they expire.’

We also see that in a separate DfT memorandum to the Delegated Powers and Regulatory Reform Committee, Section 71 is described as ‘a power to allow the Secretary of State to amend existing access contracts between Network Rail and non-GBR train operators where required to facilitate the operational transition to the new railway system’. That may be the case, but this limitation does not appear in the Bill.

The Bill does make it clear (in Section 63) who will come first if paths are in short supply: ‘Great British Railways must exercise the functions so as to ensure that it retains sufficient capacity over GBR infrastructure to allow for … the operation of GBR passenger services and of railway passenger services that it expects will in future be GBR passenger services …’

Whether passengers use GBR or open access services, their voices are going to be amplified. Committees representing passengers were created by the 1947 Transport Act, and they have since evolved to become Transport Focus (covering everywhere except Greater London) and London TravelWatch.

The new Act creates a Passengers’ Council, and Section 39 provides that it ‘must investigate any matter relating to the provision of railway passenger services or station services’, although it will be permitted to disregard any complaint which ‘appears to the Council to be frivolous or vexatious’. It will also divert complaints about London railways to the London Transport Users’ Committee (which is the formal name of London TravelWatch).

The Passengers’ Council will able to demand information from operators, and also be able to refer an unresolved matter to the ORR for regulator’s action.

Rolling stock leasing poses another intriguing question. The original ROSCOs were created as part of privatisation in the 1990s, but there is nothing about train leasing (or train building) in the Bill.

GBR does not seem to be obliged to lease rolling stock as the franchises did, when the present leases have expired. The general power of direction in Section 3 which says: ‘The Secretary of State may by regulations confer on Great British Railways such other functions relating to railways or railway services as the Secretary of State considers appropriate,’ appears to leave such decisions for the future.

Another part of the privatised railway which is relatively unscathed by the reforms is the freight sector, except that freight operators, which are another form of open access, will be doing business with GBR rather than Network Rail. The only references to freight in the Bill come in Section 17, which says: ‘The Secretary of State must set and publish a target to increase the use of the railway network in Great Britain for the carriage of goods.’

The complex chain of ‘delay attribution’ negotiations which followed a train running late will be much simpler, because a late-running GBR train will not be paying GBR any penalties.

But the presence of open access services (both passenger and freight) will complicate the picture. Section 65 provides for a Performance Scheme that ‘may, in particular, include provision for Great British Railways and persons who operate trains that use GBR infrastructure— (a) to be required to pay penalties for causing disruption to the operation of trains, (b) to receive compensation for disruption …’

As for the rest – we don’t know. Other matters excluded from a ‘high level’ measure like the Railways Bill include the future of individual operators (will their brand names continue?), the way stations will be managed (will the distinctive styles of the former franchises be swept away as soon as possible?), how ticket retailing will work (third party retailers will continue to be allowed, but they will compete with a new super-website run by the nationalised operator), how the structure of fares will change (and hopefully be simplified), and whether the double arrows will be seen on trains and uniforms (it has been suggested that they will). 

These are indeed details, but they will all play their part in shaping our railway of tomorrow.

These articles will expanded as an illustrated feature in the December print edition of Railnews

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