This item was published during the term of a previous administration that ended in April 2007
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Financial agreement sets railways on track
18/01/2005
Details of the financial agreement that will see around
£325 million transferred from the Department for Transport
to the Executive were published today.
The
Railways Bill, once enacted, devolves to the Scottish
Ministers powers to determine Scottish railway strategies;
to let, monitor and manage the Scotrail franchise; and to
specify rail infrastructure needs in Scotland.
Ministers will also be able to set fares and fund
improvements to the railway.
Only some functions - principally safety and the
licensing of railway operators - will remain reserved to UK
Ministers.
The Bill is currently before the Westminster Parliament
and the Scottish Parliament will shortly begin to debate
the associated Sewel Motion.
Secretary of State for Transport Alistair Darling has
agreed to provide the Executive with sufficient funding to
cover all the responsibilities transferred to Scotland's
Ministers.
It will be approximately £325m - covering administration
spend, the costs of operating, maintaining and renewing the
network. It contains funding which will enable a range of
enhancements to Scotland's railway.
This settlement will also ensure that improvements at
Waverley Station can be taken forward.
Part of this figure will be made up of the Regulatory
Asset Base for Scotland. This will be determined by the
Office of the Rail Regulator. It is estimated that this
will be a share close to 10 per cent of the RAB for Great
Britain, which is the basis on which the figures have been
calculated.
First Minister Jack McConnell said:
"This is the most significant devolution of new powers
to Scottish Ministers since 1999. The substantial funding
will allow progress on, amongst other things, the first
phase of the Waverley redevelopment."
Scottish Transport Minister Nicol Stephen said:
"This is a good deal for Scotland. These new powers and
funding will allow our new transport agency to deliver our
ambitious programme for improving the rail network. We want
to work closely with the rail industry to provide a better
deal for passengers."
Mr Darling, said:
"As I set out in last year's Rail Review, the Scottish
Executive is to be given more power in determining its
railway strategies and managing rail franchises. It is
clear that the Scottish Executive is best placed to decide
what is right for Scotland's railways.
"The significant funding transfer I am announcing today
will enable the SE to carry out its new powers effectively
and represents the Government's long term investment in and
commitment to the railways."
The Railways Bill implements all the aspects of the Rail
White paper that require legislative change. In relation to
Scotland it will enable Scottish Ministers to:
- Specify and fund outputs required
from Network Rail in Scotland
- Publish a Scottish Railway
Strategy
- Designate, let, fund and manage
Scottish franchises, and publish a Statement of Policy
on franchising
- Enforce Scottish franchises in
accordance with the Railways Act 1993 procedure
- Set fares, including penalty
fares
- Publish a code of practice for
disabled passengers
- Appoint a member of the Rail
Passengers Council
- Give financial assistance to any
person for the purpose of developing Scottish railways
- passenger, freight, Network Rail
- Publish guidance on proposals for
closures of Scottish railway services/facilities; and
make any proposals to ORR for closures of services that
the Scottish Ministers fund or that a Scottish operator
wishes to withdraw
- Designate, where applicable, new
Scottish services as experimental for a trial period of
five years
- Approve railway operators'
byelaws in respect of services and facilities within
Scotland. Approve byelaws for cross-border operators
jointly with the Secretary of State.
- Be the Operator of Last Resort if
Scottish franchises are withdrawn or end and another
franchisee is not appointed
- Be able to apply to the courts
for railway administration orders in respect of
Scottish franchises
- Have powers to make secondary
legislation in Scotland in a number of circumstances
where there is a power for the Secretary of State to do
so in England and Wales - e.g. Penalty Fares
Regulations
Definition of
RAB:
The 'Regulatory Asset Base' (RAB) is the Office of Rail
Regulation's calculation of the value of Network Rail's
assets. When establishing NR's income at Access Charge
Reviews, ORR include an allowance for a return on the RAB
to cover NR's cost of capital and also an allowance for the
'amortisation', or depreciation, of the RAB.