ORR launches its review of the structure of station long term charges

15 April 2005
ORR/18/05

The Office of Rail Regulation (ORR) has today published proposals to undertake a review of the structure of access charges at stations. The proposed review will make way for a more effective and efficient division of responsibilities for the maintenance, repair and renewal of station facilities. This new division of responsibilities will be established as part of implementation of the Stations Code.

The review will also provide an opportunity to move towards charges that more closely relate to the specific costs associated with the upkeep of individual stations. Subject to the views and comments of consultees, the review will be initiated in July 2005 for implementation in April 2006.

Chris Bolt, ORR Chairman, said:

“All passenger train journeys start and finish at a station, so the condition of stations and the facilities they provide impact on all passengers. Ensuring that there are appropriate station facilities and good customer service is dependent on there being an effective partnership between the various people involved – Network Rail, train operators, funders and other contractors. 

 “This will only be achieved if there are good working relationships, efficient and effective processes, and financial and other incentives, all underpinned and supported by appropriate contractual arrangements, of which station charges are a key element.”

Notes for editors:

1. There are around 2,500 stations in Great Britain, the majority of which are owned by Network Rail and leased to train operators.  (The exceptions are the 17 London and regional stations owned and operated by Network Rail and certain other station owned by third parties (e.g. St Pancras, Warwick Parkway and Prestwick International). The train operator benefiting from the lease is known as the station facility owner, and is responsible for granting access to other train operators (referred to as beneficiaries) who wish to use the station in question.  In nearly every case, the station facility owner is also the licensed operator of the station.
2. The various costs associated with building, maintaining and operating a station are shared between these parties in charges specified in the leases and access contracts.  The largest element of these charges is the long term charge, which is paid to the station landlord.
3. The introduction of the Stations Code will reform the contractual arrangements at stations, bringing significant benefits in terms of more efficient processes, improved incentives and reduced bureaucracy.  The initiative has very strong industry support but it is recognised that, in order to facilitate the Code’s implementation, there is a need to review station long term charges and adjust them to take account of the changed maintenance repair and renewal responsibilities.
4. Under the terms of station access contracts, ORR has the power to initiate a review of long term charges on or after 31 July 2005, and the results of the review may have effect on or after 1 April 2006 (Condition F11.5.1 of the National Station Access Conditions 1996 (England and Wales) and the National Stations Access Conditions 1996 (Scotland)).
5. The document published today comprises the consultation that is a necessary pre-cursor to the initiation of such a review. In addition, it sets out the proposed methodology and describes the anticipated structural changes that will result since these details are key to enable consultees to form a view on whether the proposed review will meet the industry’s requirements.
6. Further details of the Stations Code package is available above. 
7. The structure of station long term charges is available above, and also from the ORR Librarian, Sue MacSwan, 1 Waterhouse Square, 138–142 Holborn, London EC1N 2TQ, tel: 020 7282 2001, fax: 020 7282 2045.

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