One of the most eye-catching commitments in the Labour Party Manifesto for the 2024 General Election was the pledge to bring rail services back into public ownership as contracts with existing operators expire or are broken.[1] In April 2024, the then Shadow Secretary of State for Transport, Louise Haigh MP, announced that a Labour Government would fully nationalise the rail network within five years of coming to power.[2]
In the King’s Speech 2024, the new Labour Government announced a bill to enact Labour’s programme of rail nationalisation: the Passenger Railway Services (Public Ownership) Bill, which was introduced to the House of Commons on 18 July 2024.[3] This Bill will enable the Government to bring rail passenger services back into public ownership by amending legislation to make appointing a public sector operator the default when existing contracts expire.[4] The Bill also prohibits the extension of existing franchise agreements or the entering into of new agreements.[5] The Bill would apply to all of Great Britain.[6]
As to the timing of rail nationalisation, exact dates have not yet been announced. The necessary Bill passed its third reading on 3 September 2024, and will now begin its progress through the House of Lords.[7] Rail bosses expect that ministers will use break clauses in franchise contracts to bring rail services into public ownership before the agreements expire. Such break clauses can only be triggered after a date called the Core Term Expiry Date, which varies from contract to contract, and require three months’ notice from the Transport Secretary.[8] Therefore it is impossible, despite some social media speculation to the contrary,[9] for Greater Anglia and West Midlands to be taken into public ownership on their Core Term Expiry Date on 15 September.
Aside from Greater Anglia and West Midlands, the first franchises to be nationalised may be those whose Core Term Expiry Date falls on 1 April 2025, which are Chiltern Railways, Thameslink, Southern and Great Northern.[10] The last franchise to be brought into public ownership will likely be CrossCountry, whose Core Term Expiry Date falls on 17 October 2027.[11]
However, two factors may complicate these timelines. Firstly, rail services can be brought back into public ownership early if contracts are broken, for instance through poor performance by the rail operator. In July 2024, the Transport Secretary summoned the managing director of Avanti West Coast to a meeting over the operator’s poor performance, and there is a possibility of that franchise, or others, being brought into public ownership before its Core Term Expiry Date.[12]
Secondly, the default operator for services which come into public ownership is the Operator of Last Resort, a small unit in the Department for Transport. Some rail bosses have suggested that this unit may be too small to cope with the expanded workload which will follow from nationalisation.[13] It is possible that nationalisation may have to be delayed while this team is expanded or alternative arrangements are found.
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[1] Labour Party, Change: Labour Party Manifesto 2024, 13 June 2024, link
[2] The Guardian, Labour promises rail nationalization within five years of coming to power, 24 April 2024, link
[3] Department for Transport, Public ownership of rail takes centre stage as government plans radical overhaul of transport, 18 July 2024, link
[4] Ibid
[5] Department for Transport, Passenger Railway Services (Public Ownership) Bill, 18 July 2024, link
[6] Ibid
[7] Hansard, 3 September, Col. 278, link
[8] Department for Transport, XC Trains Limited 2023 rail contract, 9 August 2024, link
[9] Reddit, r/LabourUK: Rail nationalization timeline, July 2024, link
[10] Financial Times, Labour to begin rail nationalisations within months, 18 July 2024, link
[11] Department for Transport, XC Trains Limited 2023 rail contract, 9 August 2024, link
[12] The Independent, Train services to be brought into public ownership from early 2025 – minister, 18 July 2024, link
[13] Financial Times, Labour to begin rail nationalisations within months, 18 July 2024, link
