Friday Reads – December 29, 2017

On By In Friday Reads, Maps

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43 comments

  1. Tesla’s Parking Problem – “Larff, I nearly wet meself!” Or something like that, anyway.

    And, the proposal to revert (?) the NY subway to something like London at present is v interesting, too …

    Meanwhile, the first “Map” article will take some enthusiastic re-reading, I think.

  3. Braintist
    You’ve omitted FPK – Moorgate GN&City Line from your updated diagram.
    Miss Luton though ….

  7. @GREG TINGEY

    I’ve updated to show the “new bit” and the other new station. I’m not really wanting to develop the concept, just show what’s happened to all of the bits.

  9. LBM – thanks – but that article didn’t answer the specific question i raised about Paddington.

  10. HNY everyone except the rail biz for yearly bashing.

    ORR figures show that £4.2 billion of taxpayers’ cash went to the rail industry in 2016/17.
    Does the rail industry shout how much it pays in tax ?

    Britain’s trains are the oldest since current records began despite record fare increase, figures show. Press Association analysis found the average age of 21.1 years is older than at any point in publicly available records and 60 per cent older than in 2006.

    The same press that’s also been reporting the £10bn spend on 6,000 new carriages,

    Fares across Britain are set to go up 3.4 per cent from tomorrow (Jan 2) – the largest rise in five years. Yet private investment in rail reached a record £925 million in 2016/17, according to the RDG.

    Friday’s resignation of Lord Adonis has served to increase the spotlight on one of the most contentious areas of British life. The chair of Theresa May’s National Infrastructure Commission said he was “ready to share troubling evidence” about a recent “indefensible” decision by the transport secretary Chris Grayling to change the East Coast rail franchise, which he said puts hundreds of millions of pounds of taxpayers’ money at risk.

  11. “Press Association analysis found the average age of 21.1 years is older than at any point in publicly available records and 60 per cent older than in 2006.”

    So what? If trains have a design life of about 40 years you should expect the average age to be about 20. (And the outlier of the 1938 stock on the IoW is skewing the figure somewhat, notwithstanding their small numbers). In 2006 the average was lower because of the then-recent glut of new stock built to replace the slam-door stock around the turn of the century (some of which went to scrap after little more than half their design life). History is about to repeat itself with everything from Pacers to 707s going off-lease in large numbers.

    And “new” does not necessarily mean “better”, as users of everything from Pendolinos to IEPs and class 700s have found.

  13. @timbeau/ngh – exactly! Do we really need to have low quality journalism served up to us so uncritically.

  14. Fascinating, isn’t it, how a sustained period of rail-bashing has been served up by the media? Fare rises (not only predictable every year, but thrice-yearly because the bashing is done when the RPI is announced and when the fares are revealed), strikes, age-of-trains non-story, Adonis resignation…

    One almost wonders if the non-stories have been fabricated to provide a daily “news” diet in the run-up to the fares story, of which everyine knows the date.

  15. @Balthasar – I have certainly come across press officers in Whitehall who would think like that….

  16. I’m not disagreeing that the press reporting isn’t as well researched as it should be. But in this day and age, you need a constant and coherent press / media team countering this bias and pushing your own agenda. The “rail industry” (in the wider sense, not any individual organisation alone) is completely hopeless at this. Hence the RMT spokesman on BBC news report this morning gets a free hand to push his own agenda and no one available to counter it.

  17. Not a peep from the Minister so far today. Meanwhile Paul Plummer, chief executive of of the Rail Delivery Group is fielding it all at London Bridge “Look at me this is the best in the world” etc

  18. To be fair to Grayling (never thought I would be saying that!) he or whoever had been the incumbent at this time is caught between a rock and hard place on ECML. Real economics have collided with optimistic projections on which the VTEC bid was won. If they had been allowed to fail and walk away it was just idealogically incompatible for the current administration to take the franchise back under DOR, even assuming a competent team could be formed up to take it over in the time available, so the premiums lost (minus the performance bond forfeited by the franchisee) would have to be factored against the retendering costs which would be huge, especially with the short notice. Thus the way forward would have been no different really than other recent renegotiations/extensions arising from problems with the franchising process, just occuring BEFORE the franchise ended and throwing in the new unknown factor of greater control over infrastructure which has a certain political allure to those who obsess about the significance of the control over the wheel rail interface. The weird PR thing about the Grayling speech was the corresponding announcement regarding rolling back Beeching, but in reality that was nothing more than a carefully crafted and rather typical political re-announcement of schemes that have been under consideration for years and are in various states of play, many stalled in fact due to concerns over rising costs and other problems!

    What’s needed with the age of train issue is a headline graph showing how average fleet age has changed and is projected to change over time. Snapshots as widely reported just recently are almost completely meaningless. This kind of data presentation could also be regionalised. It’s not the whole story clearly though as age alone is not the critical factor at the customer interface. Comfort, cleanliness, on board facilities, reliability and satisfaction are all more important and need to be compared over time in a similar way. Even pacers were brand new once upon a time!

  19. @MarkTownend – the really puzzling thing about EC is not that it failed because of optimistic bidding – that is what has happened every time, but why *every time*, optimistic bids are accepted. DfT would appear to have enough wriggle room in bid appraisal to turn down a bid because the underlying assumptions were doubtful. Maybe the Treasury force them to do this every time, in which case it’s another instance of the definition of madness.

  20. @Island dweller – and it’s not helped by media such as the BBC saying (as they did this lunch time) saying that national rail fares needed to rise to fund CrossRail…

  21. No further announcements today.

    Andrew Sparrow – Guardian – back from the Number 10 lobby briefing. Here are the key points.

    Downing Street played down suggestions that Chris Grayling, the transport secretary, might be sacked in the reshuffle expected later this month. Grayling is on a ministerial visit to Qatar today and neither he nor any of his transport minister colleagues have been giving interviews this morning defending the rail fares increases. But when it was put to him that Qatari ministers might not see much point in meeting Grayling given that he has been tipped for the sack, the prime minister’s spokesman said he did not accept that at all. The spokesman said:
    Chris Grayling is working hard and doing a good job as transport secretary.

    Grayling was one of five cabinet ministers named as being tipped for the sack in a story by Tim Shipman in the Sunday Times at the weekend. But the fact that the Labour peer Andrew Adonis publicly called for Grayling’s departure in an Observer interview the same day almost certainly has boosted his position because prime ministers are always loath to letting it look as if the opposition is deciding who sits in their government.

  22. GH: “why optimistic bids [for the ECML franchise] are always accepted”

    I think the key problem is that bidders are allowed to have extremely steep claims about franchise payments and passenger/fare growth in their bids, and the payments at the end of the term are given too much credit. This gives too much incentive to backload the payments and growth: the bidder ends up making a profit in the early years, and defaulting nearer the end when they start losing money. Personally, I would insist that the franchise payments can only increase at a small percentage rate (like 3 percent) so that we get the money up front if the bidder believes these fantastical rates of growth in passenger revenue.

  23. @MARK TOWNEND
    To be fair to Grayling (never thought I would be saying that!) he or whoever had been the incumbent at this time is caught between a rock and hard place on ECML.
    The weird PR thing about the Grayling speech was the corresponding announcement regarding rolling back Beeching,
    What’s needed with the age of train issue

    Did not expect The Age of the Train slogan coming back anytime soon.

    and to be fair to Beeching (never thought I’d be saying that either) all he really said was that the future core passenger traffic would be Inter-city and SE Commuting. After that it’s whatever you’re willing to subsidise.
    Connecting some now large towns to the network, putting in some diversions, and allowing for the changing nature of freight pretty much adds up to his Shape of the Railway.

  24. @ANECONSPEAKS I think the key problem is that bidders are allowed to have extremely steep claims about franchise payments and passenger/fare growth in their bids,

    Which are based on official provided forecasts of Government’s alleged management of the economy.

  25. @ALEKS2CV 2 January 2018 at 15:08

    “Did not expect The Age of the Train slogan coming back anytime soon”.

    Unfortunately linked so indelibly in the public consciousness with that unmentionable blond locked public entertainment figure now so much maligned.

    It was a time of great optimism and the ads were a very successful campaign however during Sir Peter Parker’s relentless assault on the crumbling edge of quality throughout British Rail.

    To be fair (not to him though), the deceased cigar smoking pervert was then a very popular figure and a logical choice to front the ads.

  26. Maybe Grayling is negotiating HS2 bonds with the Qataris. Expect they dropped a bit into London Bridge as well via the Shard.

  28. @Aneconspeaks /a2cv – were that completely true then all bids’assumptions would be the same and the bidders would simply be bidding the cost of the bid/cost of finance. I know that isn’t true from the painful “washing up” undertaken by franchise bid teams after they have failed to win. The main issue seems to be around revenue growth forecasts, where bidders appear to have considerable flexibility; another,linked, area is on the assumptions about the impact of “quality investment” on revenue -something that the PDFH handles very weakly and also something which,for obvious reasons,tends to be endloaded.

    Neverthless, although these may explain bidders’ unsustainable optimism, it doesn’t explain why DfT (or HMT) has such a shallow learning curve when it comes to appraisal. I don’t buy the plot theory of history that bidders are simply recycling back to the Treasury their own assumptions, and therefore cannot be allowed to be seen to be wrong, Were that so then every bid would be similarly laughable. It’s possible from what I know of the way HMT works, that they always assumed that EC is a cashcow and that past experience teaches no lessons. A more subtle explanation would have to do with the way the public sector finances work,with the inflated receipts knowingly off the end of the three year p/e horizon,but looking good at the time of the announcement of the award. Kicking the can down the road with added cynicism; or for Cornfordians, a subtle version of the Unripe time argument…

  29. @GRAHAM H

    Is it a forlorn hope. There was the levy for crossrail plus Section 106 payment for The Shard came to £37 million, and London Bridge Quarter redevelopment work on the forecourt. I thought they provided the bus station.

  30. If backloading of bids (or a limit of, say, 3% pa) was imposed, then would more reasonable bids emerge? Or would that just stop the companies seeking quick profits to depart the stage (which might be a good thing)?

  31. Re Graham H

    “Do you have any evidence for that at all?”

    I doubt it – much more likely CG is in Qatar to thank them for helping sort out the aftermath of the Monarch Airlines collapse and unofficially the recent £5bn eurofighter purchase. Qatar’s short haul fleet and pilots are some what underutilised due to some local diplomatic difficulties Qatar currently has, so a deal that was good for both sides was fairly easy to reach.
    The Qataris need a some friends at the moment so good time for bit of soft diplomacy on the side without any one from the FCO (or MOD) there which might inflame tensions “locally”, hence Grayling is the safe option.

  32. Mark Townend,

    In his autobiography Peter Parker recalls that the external marketing guys suggested Savile as a friendly face people would trust. He admits to being taken aback by the suggestion and asks them to double-check their research and do it again. He recalls that they confirmed their findings and he goes along with it.

    I sometimes wonder why he had those doubts and why he bothered to record them in his autobiography.

    Now, if you want a real pervert connected to the transport business check out Eric Gill the sculptor and typeface designer. Makes Savile almost seem like a nice guy although it was the prolific nature of Savile’s acts that must means he must hold the rather undesirable accolade.

    ngh,

    ‘hence Grayling is the safe option’

    Never thought you would write such a statement!

  33. The whole “East Coast” bids & collapses story is a complete fiasco.
    Probably because “everyone knows” that from 1851 until well after nationalisation, with the possible exception of 1932-3, the GNR & its successors made a handsome profit form the GN main line & the traffics to Leeds & York, plus the intermediate & further points.

    Now, the non-railway people supposedly running the show simply regard it as an “easy” cash-cow. Ignoring the fact that the GN & the LNE were very lucky. They had a succession of very able Chairmen & General Managers & their record of mechanical performance, thanks to the remakable list of great ( mech) engineers was also second to none. [ note ]This tradition carried on well past nationalisation, but appears now to have been lost utterly.
    A similar fate seems to have befallen another railway, which also had it’s admirers – that which heads west from Paddington.

    [ note: See the photo in my avatar, taken in 1962 IIRC – I’m glad to say that 4489 / 10 / 60010 is still with us. ]

  34. Re Alison W,

    If backloading of bids (or a limit of, say, 3% pa) was imposed, then would more reasonable bids emerge?

    The problem is that when improvements do get delivered then legitimate growth rates of far higher than 3% can / will actually happen. Much more detail needs to be paid to the local economics rather than crude national level economic growth assumptions.
    For me one of the key problems with the East Coast franchise failures is the lack of understanding of local economic drivers and how they generate (additional) traffic along the route. DfT seem to keep forgetting that population density along the ECML if far lower than most other routes and there is above average levels of public sector employment in many of the towns and cities along the routes with some of the business travel market from London to the those towns and cities being civil servants or contractors visiting various government departments non-London offices. Hence government employment levels and spending will have a noticeable effect on ECML travel which isn’t going to be that good for franchise holders especially in an era of austerity.

    There are real issues rather than just modelling ones though:
    – delays to upgrades (some planning related which is a growing DfT gripe (not just rail))
    – delays to new rolling stock
    – ORR permitting the First London – Edinburgh open access services which will really hit VTEC revenues as they were also going to radically improve London Edinburgh capacity
    – future onboard staffing models

    With all the models if growth in year 1 is below the anticipated level then it is very difficult to make it up in later years all to do with maths rather than conspiracy theories.

  35. Re PoP
    “ngh,
    ‘hence Grayling is the safe option’
    Never thought you would write such a statement!”

    Neither did I… but he is perfectly suited to a diplomatic thank you trip and probably stops him doing damage at home.

    Grayling being out of the country on fare bad news day after being saved by Adonis’s kiss of life is a stroke of luck for Grayling.

  36. GH: “were that completely true then all bids’ assumptions would be the same”

    Eh…nothing to do with my point, I don’t agree with the other poster’s remarks. I would expect bidders to take different views about future passenger/revenue growth. At the moment, how would you actually disqualify an “over-optimistic bid”. If the franchisee promises to pay, then how can the government claim they won’t? In my proposal, bidders with ambitious growth profiles have to hand over their money at the beginning.

    NGH writes: “growth rates [revenue/passengers] of far higher than 3% can / will actually happen.”

    The rate at which the premium payments rise does not have to match the rate at which the passenger/revenue grows. My proposal is that if a bidder wants to suggest very high rates of passenger/revenue growth, they should pay up front (e.g. make a loss at the beginning and a profit at the end of the franchise, since we are forcing them to flatten the payment profil), rather than backload the payments.

  37. @Aneconspeaks. Sorry to provide a portmanteau response; I agree that you could try and get the money off the bidders before they did a runner – you might not get so much money upfront, of course, as you would in theory get if you simply rearranged the “unconstrained” bid profile, for obvious reasons. And therein lies the rub: presumably it suits DfT to present a high cash flow when it comes to the PES round, even if they know it’s silly by the time you reach Year 3, because the Treasury will take the bait. When you actually get to Y3, the Treasury are already on your hook because they are so committed to privatisation. It’s just a rerunof 1993, really…

  38. Re ANECONSPEAKS

    My proposal is that if a bidder wants to suggest very high rates of passenger/revenue growth, they should pay up front (e.g. make a loss at the beginning and a profit at the end of the franchise

    But that is what happens already (and has done for years), franchisees already make losses in the early years.
    (The growth has yet to occur and the franchisees are investing heavily). What you are proposing is effectively increasing franchisee borrowing levels, which has to be paid for via reduced premia to DfT.
    Most of the current early years franchisees (as opposed to direct wards/extensions) are losing money i.e. GTR, Scotrail Greater Anglia, VTEC, C2C, Transpennine, Northern.

  39. ngh refers to increasing franchisee borrowing levels, which has to be paid for.

    True, but the current custom involving defaults or bail-outs also involves costs for the public realm. Not only financial ones, but loss of credibility as well.

    Mind you, if it’s all part of a game to extract more money (at the end of the day) from a reluctant treasury, then maybe the existing custom of planning for running the risk of default/bail-out is not as daft as it looks….

  40. @Malcolm – precisely. As I may have remarked before, the only way to beat the Treasury is to get them to sign up to a set of seemingly desirable rules (but ones whose ramifications are not spelled out to them) and then just turn the handle. That was the basis on which we managed to renew the entire Regional fleet in the ’80s, and highways colleagues pursued their road improvemnt programme.

  41. GH: This actually a serious question. Why doesn’t the treasury tell the Transport Minister that the money he has is that which is raised from the franchise bids. So if the money doesn’t turn-up, then transport takes the hit?

  42. @aneconspeaks – because we have had a unified Exchequer now for many centuries – the Treasury isn’t going to give in on hypothecation any time soon, even if it gives them some selfinflicted wounds.

  43. @NGH Neither did I… but he is perfectly suited to a diplomatic thank you trip and probably stops him doing damage at home.
    Grayling being out of the country on fare bad news day after being saved by Adonis’s kiss of life is a stroke of luck for Grayling.

    Maybe not as he had to respond in the end. He did say he was bidding for work on their airport so something more than just Monarch is implied.

    Saying “Today, my presence in the country doesn’t make any difference” makes one wonder which day would.

    Shadow health minister Justin Madders said: “Patients and staff deserve better than a Health Secretary doing a ‘Grayling’, going to ground and refusing to explain the appalling downturn in standards …

    Is “doing a Grayling” a thing now?

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