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All ‘Go’ for railway co-op: Co-operative News

Posted on August 5, 2009 · Posted in Co-operative News

 

Electrification of the London to Swansea rail line is good news for public transport users in the South West and the Government’s approval for Network Rail to meet the £1bn cost is a demonstration of real commitment not just to the rail system, but also to combatting climate change.

 

But for many people away from the main urban centres, what is needed is much more than just faster journey times to London.  What they demand is connectivity that reduces rural isolation, makes journeys faster, cheaper and easier and improves the economic prospects of smaller towns and villages.

 

This is where Go! Co-operative comes in, which is not only one of the newest co-ops to be established, but also the most recently established train operating company.  Its prospectus for raising capital is about to be published, with the ambition of raising a quarter of a million pounds over the next two years.

 

Go! Co-op intends to be the fifth train operating company taking advantage of the principle of open access to rail lines that is enshrined in legislation and which is intended to increase the provision of services by sharing existing lines.  This provision enables additional services to operate alongside the main rail franchises.  Existing open access rail operating companies include the Heathrow Express and Hull Trains.

 

However, Go! Co-op would be the first open access train provider running as a multi-stakeholder co-operative that brings together the interests of commuters, workers and the communities that would be served, via their local authorities. It is backed by some heritage railway operators.
The co-op’s business planning is already well developed, thanks to seedcorn funding supplied by Co-ops UK and the Co-operative Group, through the Co-operative Fund, backed by practical support from the Somerset Co-operative Services.
Go! is looking at various new routes, including local branch line operations and longer cross country services. Some of these involve open access services on Network Rail lines, while others would operate in partnership with heritage rail and other independent railway owners. At this stage, it is not possible to say which routes will be pursued – detailed studies on line capacity and passenger demand are needed first, as well as more negotiation with potential partners.

 

The chair of Go! Co-op is well known co-operative activist, Tim Pearce – the South West regional organiser for the Co-op Party until he retired three and a half years ago.

 

Existing train services run to London,” explains Tim.  “Our intention is to serve other communities that don’t have good connections to anywhere.  Cross-country connections are important.  We are looking to potential routes in the South on existing rail networks.”

 
The Go! Co-op initiative has been given extra impetus by the recent publication of the Association of Train Operating Companies’ (ATOC) document Connecting Communities, which supports the principle of much improved connectivity for isolated communities by making greater use of lines that, at present, run few services.  “We are interested in underused and also closed lines and closed stations, but that’s a lot of money,” says Pearce.

 

We are interested in the electrification, but that is a long time ahead, at least five years.  It does raise interest in the rail network and the South West is getting a fairer crack of the whip than it has in the past.  We want to develop routes in the South, but including the North.  We are hoping to develop routes from the South to the Midlands, servicing the West Midlands conurbations, developing links where they don’t exist.

 

We are trying to raise money from potential commuters and from councils along the rail lines.  We will run it as a multistakeholder co-op.  The communities that benefit will have control over the service.  We envisage a scenario where the guy who pushes the trolley can be on the board.  I have been very impressed by the results of [societies’] board elections where you get electricians and so on elected to the board.”

 

Tim’s involvement in the project arose from a motion put forward to Co-operative Party Conference in 2007, which called for the mutualisation of Network Rail.  “We have made some progress there,” says Pearce.  “We still hope to get a result from that and are fairly optimistic. 

 

We then organised a conference last year [on Network Rail mutualisation].  That was successful.  It had a lot of rail people and co-op people there.  Basically the idea [for Go!] started to gel about that time and because of that conference.” With that momentum established, one of the founders the project – Alex Lawrie of Somerset Co-operative Services – invited Tim to get involved.

 

The timetable for progress is as impressively ambitious as the project itself.  The co-op has already been authorised by the Financial Services Authority to raise the funds. It is also working with the FSA to develop rules that allow for withdrawable and transferable Industrial and Provident Society share capital raised from members and outside investors. Outside investors will have enough voting power to protect their investment, but in accordance with co-operative principles the passenger and employee members between them will have effective control.

 

Go! believes, given the example of the major fund raising achieved by windfarm co-ops, that it can raise the necessary investment.  Assuming it does so, it hopes to gain route authorisation some time next year and begin services in 2011.

 

Ultimately, Go! has aspirations even beyond this – its motivation is to improve connections between communities, not just to run rail services.  So it would also like to be involved in running bus services that feed the rail services and perhaps operate bike hire and car clubs. 

 

It is one of the most impressive and ambitious co-operative projects to come forward in many years.  But it is also firmly grounded in a sense of realism – it deserves wide support.