Competitive tendering - rail

[ozbob]

It has taken a while, but looks like the ' competitive tender ' process is off and running ...

Queensland Rail will be next.  Expect the inland passenger trains (Westlander and Inlander) to go soon as well.

[ozbob]

Background -->

http://www.treasury.qld.gov.au/office/knowledge/docs/better-services-for-queenslanders/fact-sheet-public-transport.pdf

In the area of public transport, the Commission's recommendations are about delivering the best value-for-money rail and bus services for
Queensland taxpayers. This means putting in place service delivery models that encourage innovation and efficiencies. Recommendations
include:
15 City passenger rail
services and network
infrastructure be opened
up to contestability, like
bus services, to allow
different providers,
including private
providers, to bid to
operate services and
maintain below-rail
assets in a particular
franchised area under
franchise and lease
arrangements.

16 Competitive tendering be
introduced for long
distance and tourist
passenger rail service
contracts, including:
• evaluating the number
of routes serviced and
frequencies,
franchisees and
franchise areas before
initiating the tender
• owning the rollingstock
required to provide the
services in a State
Government entity, and
leasing this to the
franchisee for the term
of the contract.

17 Competitive tendering be
introduced for bus service
contracts throughout
Queensland, including
evaluating the number of
routes serviced and
frequencies, franchisees
and franchise areas
before initiating the
tender.

18 Mount Isa rail freight line
be transferred to Port of
Townsville to be managed
as an integrated supply
chain, with a view to
divestment of the
integrated business.

19 Queensland Rail remain
the owner and operator of
the regional rail network,
but with the maintenance
task to be outsourced
through a competitive
tendering process.

[Gazza]

Couldn't those two route be sold to GSR or something?

[ozbob]

Couldn't those two route be sold to GSR or something?

New rolling stock would be needed (present carriage stock is around 50 years old and not compliant)  I don't think the government will invest in new rolling stock (DMUs) for those services .  Word is they will cease later this year. 

[petey3801]

15 City passenger rail
services and network
infrastructure be opened
up to contestability, like
bus services, to allow
different providers,
including private
providers, to bid to
operate services and
maintain below-rail
assets in a particular
franchised area under
franchise and lease
arrangements.

Have they not learnt anything from Melbourne?!? 

[Fares_Fair]

The 'maintenance task outsourcing' could be the Australian Rail Track Corporation in selected areas.
That report is due back to the Government by mid-year.

[dancingmongoose]

I don't want to see the inlander or westlander go, unless they are being replaced by something better (high speed for example). They could just reduce the frequency to just once per week if they want to save money

[petey3801]

The 'maintenance task outsourcing' could be the Australian Rail Track Corporation in selected areas.
That report is due back to the Government by mid-year.

The part I quoted was for the City network, and ARTC, if they continue their current track record, don't touch suburban pax networks.

[ozbob]

Petey, hopefully the Government has realised that since the CoA etc. that it is not the panacea that some in the blue camp think it is.  Economic rationalist yadda yadda does not necessarily translate to the best outcomes by a long shot ...

[petey3801]

Petey, hopefully the Government has realised that since the CoA etc. that it is not the panacea that some in the blue camp think it is.  Economic rationalist yadda yadda does not necessarily translate to the best outcomes by a long shot ...

Very true. Although, being the pessimist that I am with this sort of thing, plus the way this Government is going, I wouldn't be surprised if they just bundle the whole lot up together!

[Stillwater]

The wording the Commonwealth is using is that the report into the feasibility of ARTC taking over non-urban track is due 'later this year'.  Seems the words 'due mid-year' no longer in use, suggesting that the study is going to take longer than expected.

Competitive tendering = reducing influence of unions

[Gazza]

I don't want to see the inlander or westlander go, unless they are being replaced by something better (high speed for example)

The coach out that way already is faster.

[#Metro]

I'll play devils advocate here and say whats wrong with Melbourne?

Intially started by LNP, renewed under ALP. This would seem to indicate that both sides are happy with the results, although these results are not what Kennent originally was seeking.

Back to Qld, they have tried increasing fares, not improvement in subsidy. They have tried increasing some services, no improvement in subsidy. The current very high susbidy will always be the road block that slows the roll out of heavy rail infrastructure. I suspect the next step is to try private management with international experience and see if this can make a difference.

Regards
Shane

See, the problem here is that there are often little things that we can't see operating. Any criticism of the Melbourne Model also needs to also explain what is going on in Stockholm, Sweden, because what is interesting is that the same operators in Melbourne for BOTH the trains and trams also run Stockholm's Subway trains and buses (MTR and Keolis).

For example,  from what I can gather, the rail maintenance is contracted out in Sweden:

About Strukton Rail AB

The Swedish Strukton Rail company, Strukton Rail AB, is a rail technology supplier with a focus on operations, maintenance and railway projects including new construction and renovation. In Sweden, Strukton Rail has its roots in SL's production activities. The company has several major maintenance contracts with Infraverket (the Swedish Transport Administration) and Storstockholms Lokaltrafik (SL) as its largest customers. Strukton Rail AB has 500 employees and in 2011 had net sales of EUR 117 million.

http://www.struktonrail.com/news/2013/new-maintenance-contracts-start-in-sweden/
http://www.struktonrail.com/maintenance/

The reason why organisations may choose to do things in-house or externally is simply because it costs money to go outside and do tendering and assessing contractors, hiring lawyers etc so the savings have to be at least enough to cover that. So it is not automatically a given that external suppliers will be cheaper or 'better'.

Another thing was when I was listening to then CEO of QR Paul Scurrah give a talk about how it was a problem when QR was divided into QR and QR Network and trying to co-ordinate things that needed to be done. Now I cannot be certain that QR Network did the maintenance but from my impression it did. The presence of two separate entities resulted in some loss of co-ordination, and it is interesting because this was a case of where both entities were publicly owned and indeed derived from the same common company!

Some time later, QR network was reincorporated into QR.

The second clue comes from Melbourne. This is the makeup of MTR Melbourne:

MTR Corporation (60%)
John Holland Group (20%)
UGL Rail (20%)

Here you had I think three companies trying to get things done under I think, the MTR (or Connex? I can't remember exactly) model. The latest incarnation of MTR is a single company which the three contractors own. In other words three separate companies decided to all bring everything in-house under one roof.


So from my view, I think the jury is out and I can't really say either way.

[#Metro]

About MTR Stockholm
Since autumn 2009 and for a minimum of eight years thereafter, MTR Stockholm (MTRS) has the responsibility for the running, planning and maintenance of the Stockholm underground system.  MTR Stockholm is a subsidiary of MTR Europe in London, and employs about 3,000 people. In our view, it's our task to make the underground even more appealing to Stockholmers. The underground is far more than a mode of transport; it's an absolutely critical piece of the puzzle that makes Stockholm work.

http://www.mtrstockholm.se/mtr-in-english

MTR Stockholm, Sweden started at the same time as MTR Melbourne did... It's lines do contain branches, although not to the extent of Melbourne. I presume they also have to deal with snow and blizzards.

[#Metro]

Back to Qld, they have tried increasing fares, not improvement in subsidy. They have tried increasing some services, no improvement in subsidy. The current very high susbidy will always be the road block that slows the roll out of heavy rail infrastructure.

The reason for the high subsidy is because the passengers that would be on the train have been sequestered/creamed off by BCC and diverted away from rail into the busway. This has been compounded by the terrible service frequency that had not been fixed until January this year (also probably because oodles of money was being spent on $465 million dollar x 1km busways).

The presence of 2 staff per train is also contributing to the higher costs as well as the need to clean, staff and operate stations (as opposed to buses).

[STB]

Another thing was when I was listening to then CEO of QR Paul Scurrah give a talk about how it was a problem when QR was divided into QR and QR Network and trying to co-ordinate things that needed to be done. Now I cannot be certain that QR Network did the maintenance but from my impression it did. The presence of two separate entities resulted in some loss of co-ordination, and it is interesting because this was a case of where both entities were publicly owned and indeed derived from the same common company!

Some time later, QR network was reincorporated into QR.

As a former Train (Network) Planner at the then QR Passenger back in 2009, one of the main issues we had with the two entities was that we had to get permission from QR Network to run trains beyond Caboolture, and get every single train path approved through them, so basically it was an extra level of paperwork and phone calls just to timetable a service.  When QR Network was integrated back within QR, I would assume that extra level was abolished making things easier for all, and in turn allowing staff to talk to each other once again. 

There were also silly things going on where the Planners (QR Passenger) were not allowed to talk to the infrastructure people (QR Network) - seriously, the doors were physically locked for QR Passenger employees to the QR Network employees and vice versa, in the same building we worked in!

What I'm hoping with QR if they decide to give it to a private operator to run the trains (I'm not sure if a private operator should also be in charge of the infrastructure), that the private operator still gets an open door policy with the State, so silly things like the above don't happen, as Planners in particular need to talk to Infrastructure, they go hand in hand.

[Stillwater]

It looks as though Inlander and Westlander will go, which is a shame because they could be made viable by allowing them to cart freight.  (Isn't that competitive contestability?)  Mt Isa line to be 'integrated' with Port of Townsville.  Kuranda rail to be hived off to some tourism outfit.

Coal lines privately owned.

That leaves ARTC to maintain the current AR-border standard gauge track, the 'inland rail' Melbourne-Brisbane, eventually (maybe) Toowoomba-Gladstone.  NCL to come under ARTC administration (and funding) -- focus on freight operations, but with spin-off benefits for more efficient passenger rail on duplicated track through the SC.  Where does CAMCOS fit in?

ARTC would not be interested in east-west railway lines, unless they carry coal.

Companies such as GSR will be invited to run the Tilts, possibly with a subsidy, decreasing over time.  Sweetener could be to give non-SEQ pensioners a non-transferable free ticket every year.  Brisbane suburban operations tendered out, a la Melbourne.  It will be a brave new world.

[SurfRail]

If they have any sense they will ensure that the Brisbane "suburban" area goes to at least Beerwah, if not Nambour, to ensure that passenger services are not hobbled even more.

[petey3801]

15 City passenger rail
services and network
infrastructure be opened
up to contestability, like
bus services, to allow
different providers,
including private
providers, to bid to
operate services and
maintain below-rail
assets in a particular
franchised area under
franchise and lease
arrangements.

Have they not learnt anything from Melbourne?!? 

I'll play devils advocate here and say whats wrong with Melbourne?

Intially started by LNP, renewed under ALP. This would seem to indicate that both sides are happy with the results, although these results are not what Kennent originally was seeking.

Back to Qld, they have tried increasing fares, not improvement in subsidy. They have tried increasing some services, no improvement in subsidy. The current very high susbidy will always be the road block that slows the roll out of heavy rail infrastructure. I suspect the next step is to try private management with international experience and see if this can make a difference.

Regards
Shane

I think you may have missed my point. I don't really care about the services being contracted out, I care that the infrastructure is going as well, likely to the same company. MTR aren't doing too bad (considering what they started with) AFAIK, but have you actually seen the infrastructure (ie: rails, formations etc) in Melbourne?!? It makes the QR network look like it's capable of 300km/h! If they really want to privatise the maintenance of the infrastructure etc., it really needs to go to a separate company (IMO) who only deals with that. Having it in the hands of the operator gives said operator the temptation to run the tracks down, skimp on maintenance, then when it gets to such a deplorable state that it's almost unsafe to run trains, they'll just give it back to the Government or demand millions of $$ in extra handouts to fix it, basically what happened in years gone by in Melbourne. Tracks up here are bad enough already without having a company rip more money out of it...

[Stillwater]

Productivity Commission latest on providing infrastructure:

http://www.pc.gov.au/projects/inquiry/infrastructure/draft

[dancingmongoose]

Outbound Westlander was well serviced today (through Oxley on the UP main), a fairly safe guess at close to half the seats occupied. Better than most reports you hear