Next steps in reform of rail industry network code

03 June 2004
ORR/18/04

Tom Winsor, the Rail Regulator, has today published for consultation his proposals to complete the first stage of reform of the network code – the railway industry’s central  contractual code which sets out the conditions upon which train operators gain access to the national network, how the timetable is put together, how the network is improved and renewed, how new rolling stock is introduced, how local accountability for stewardship is delivered and generally how Network Rail manages the network.  It is a common set of rules which apply to the vital interface between track and train, and which make a reality of the interdependent joint venture between Network Rail and its freight and passenger train operator customers.

Work on the reform of the network code has been under way in earnest since Autumn 2003.  Industry working groups were established and have worked well, and the Regulator has welcomed the constructive and intensive engagement of industry players in this important task.

The Regulator’s proposals take account of reactions to the most recent consultation on the reform of the code which was carried out in March and April 2004. Subject to responses to today’s consultation document – due by 24 June 2004 -  the Regulator expects to issue a notice modifying the code by the end of June 2004, to take effect from 1 January 2005.

Following these initial changes, which are largely of a procedural and clarificatory nature, the Regulator expects the railway industry to take forward the second stage of reform of the code, tackling more material issues and possible changes to the economic architecture of the code.

Tom Winsor said:

“These reforms – and the reforms to come – are important to intensify the virtual integration of the railway and the spirit of co-operation which has so recently been established.  At privatisation, the railway companies were set up to be in conflict; these reforms are about creating a culture of co-operation and delivery of services to passengers and freight customers.

“But the code must no longer be seen as belonging to the regulatory authority – it is the industry’s code, not its regulator’s.  It should be owned and developed by the industry collectively, and improved through the change procedures which the architects of the original code - only too well aware of its shortcomings - established for that purpose.

“The second stage of network code reform should consider the wider questions of the economic architecture of the relationship between infrastructure provider and infrastructure user, and the structure and breadth of coverage of the code.  These are issues of considerable importance, and they need a high degree of engagement and the application of imagination and creative energy to devise a sound and sustainable system.  The industry should now build on the reforms of this first stage, and in stage 2 maintain and even increase the momentum which has been established for the code’s reform.”

Notes for editors:

1.  Reforming the network code: emerging conclusions and proposals for changes to address priority issues is also available from the ORR Librarian, Sue MacSwan, 1 Waterhouse Square, 138–142 Holborn, London EC1N 2TQ, tel: 020 7282 2001, fax: 020 7282 2045, e-mail: rail.library@orr.gsi.gov.uk.

2. The network code (formerly called the Railtrack Track Access Conditions) is a common set of rules applying to all parties to regulated track access contracts with Network Rail.   It covers certain matters, generally concerning industry processes, such as timetabling, which either need to be common to all train operators or where there are significant benefits in having commonality.  Condition C8 of the network code allows the Regulator to modify the network code, subject to various safeguards and procedural requirements, including a public interest test.

3. The Regulator is seeking comments on his proposals for the first stage of the reform by 24 June 2004.  Having considered the responses to the consultation, the Regulator intends to implement his proposals by issuing a modification notice in accordance with Condition C8 of the network code by 30 June 2004, to take effect on 1 January 2005.  From July 2004, the new Office of Rail Regulation will take forward with the industry the second stage of the network code reforms, led by the industry with the ORR’s encouragement and support.

4. The proposed changes in stage 1 cover procedures for changes to the code, management of operational disruption, changes to the network and to vehicles used on it, provision of information, appeals to the Office of Rail Regulation, and some general provisions and definitions.

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