West Midlands Franchise Agreement

By the end of 2002, the SRA had also amended its policy on possession of franchise agreements to introduce various other performance criteria in addition to maintaining the PSR to improve the overall quality of passenger transportation. The duration of the franchises would be maintained for five to eight years, but extensions would be allowed if the key performance indicators (KPIs) were met. It also changed the approach to risk in terms of costs and returns and introduced incentive payments for long-term returns and investments. The changes came into effect after the allocation of the Transpennine and Wales & Borders franchises, which were already too advanced. The bidding process has also been simplified by providing more details in advance to speed up the process and make bid evaluation more robust. Using short-term tactical expansions, the SRA planned to make the changes in the franchise redesign and smooth out the re-franchise schedule, aiming for two or three awards per year. [34] The coalition government elected in May 2010 suspended franchising until a review was published in January 2011. As a result, they further reformed the system to increase operators` flexibility, with greater incentives for reducing operators` costs and franchise terms that were dealt with on a case-by-case basis. They extended the standard duration of the deductible to 15 to 22.5 years (with shorter maturities where it made sense), ended the risk cap and neck approach, which pre-six risk sharing with the government in terms of future demand, and introduced benefit sharing and review points. The new system, which was originally to be applied with the InterCity West Coast offering, also took a less prescriptive approach to service specification and introduced measures to combat overcrowding and changes in the way quality measurement was approached.

Due to the increased future risks borne by operators, the government required high financial security to avoid premature termination of the contract. [39] [40] [41] Oyster and contactless card payments can be used on the London Northwestern Railway at Watford Junction, Bushey, Harrow & Wealdstone, Wembley Central and Euston stations. Under the original 1993 Act, the Franchise Manager established the minimum service levels of a franchise in a Passenger Service Requirement (PSR), the first sales being the current br schedule, and made it available to a competitor. Winners were chosen on the basis of pure cost – those who offered to pay the highest premium or receive the lowest subsidy would run the franchise. .

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