A landmark moment

The largest public procurement ever undertaken by Welsh Ministers

02 January 2019
A photo of a railway track in Wales

In October 2018, the Welsh Government took control of Wales and Borders rail services for the first time, with Transport for Wales assuming responsibility for the £5 billion rail franchise and promising to transform rail travel in Wales over the next 15 years.

The deal, described by First Minister Carwyn Jones as a 'landmark moment in the future development of Wales,' was the result of four years’ hard work by Welsh Ministers, with a Burges Salmon team led by partner Brioney Thomas involved throughout. The new operator, KeolisAmey, was appointed in September last year, and immediately announced that 95% of journeys would be on new trains within five years, and an extra 600 staff would be recruited. Four new Cardiff light rail stations are also planned as part of the South Wales Metro.

Brioney and her team, who are nationally-recognised specialists in the highly-regulated rail industry, were first brought in to advise Welsh Ministers as they sought to have certain rail franchising powers devolved to them from the Secretary of State for Transport. This required negotiation with Westminster and led to the creation of a new critical framework, granting the Welsh Government the powers to carry out the procurement of a new operator and setting out how it would move forward in compliance with complex EU law in this field.

The Burges Salmon team also developed a novel vertically integrated arrangement whereby the operator, rather than Network Rail, would be responsible for the condition of the network infrastructure. This required an innovative transfer of Network Rail-owned track and assets to Welsh Ministers.

Then came the procurement process to identify an operator and development partner to deliver the rail services and transform the core rail infrastructure across the country.

Brioney says: 'This was a hugely important project for Wales, because for the first time they were able to award a rail franchise for themselves, which meant working out what the rail requirements really should be for the country in the future. Their approach was always ambitious and forward-thinking so as well as a new service provider, they also sought the opportunity to upgrade the infrastructure, increase the frequency of trains and provide Metro-style services to Cardiff from the valleys. There are huge socio-economic benefits that come with that.'

The team from Burges Salmon advised Transport for Wales and Ministers on all aspects of the project from start to finish including rail regulations, real estate, pensions, employment, health and safety, environment and construction issues. The firm also used its public and private sector experience to anticipate and deal with stakeholder issues, and worked to address the various political uncertainties associated with a project of this kind, from the impact of elections through to the impact of Brexit on European funding.

The Welsh Government’s Economy, Infrastructure and Skills Committee described the project as ‘heroically ambitious’, and it had to be delivered in a completely different way to all previous rail operator procurements. Thanks to Burges Salmon’s deep involvement in the UK rail market since privatisation, it was able to provide invaluable support and advice to the client.

Alexia Course, Director of Rail Operations at Transport for Wales, says: 'Burges Salmon was in the room with us throughout many of these negotiations, giving us advice quickly and providing that joined-up cohesive support. We spent a great deal of time with their team in Bristol, Cardiff and London, and they were always on the end of the ‘phone when we needed them. It has been a hugely positive experience working with the firm and we continue to work with them post-mobilisation on the longer-term asset transfers.'

It has been a hugely positive experience working with the firm.

Alexia Course, Director of Rail Operations at Transport for Wales

Transport

Our transport lawyers are leaders in their field. With decades of experience in the sector, we offer in-depth expertise across the modes of transport law.
View expertise