Government extends emergency agreement with Great Western Railway

All revenue and cost risks from Great Western Railway (GWR) will continue to be held by the Government until at least June 2021, the train operator’s parent company has announced.

FirstGroup welcomed the Department for Transport’s decision to extend GWR’s Emergency Measures Agreement (EMA).

EMAs were introduced for all of Britain’s rail franchises in March to keep trains running despite the collapse in demand caused by the coronavirus pandemic.

Chief executive Matthew Gregory said: “This demonstrates the essential nature of GWR’s services to the communities it serves, and provides important clarity and continuity for our customers, employees and wider stakeholders.

GWR’s initial EMA was signed on the same day as a new franchise agreement in March, using a different process and timing from other franchises, which are due to see their agreements expire on September 20.

FirstGroup said “discussions are under way” with the DfT about what will happen to its operators, which also includes South Western Railway.

EMAs involve the DfT waiving franchise holders’ revenue and cost risks, while paying them a fixed fee for running services.

There is the possibility of a further performance-based payout.

EMAs have already cost taxpayers at least £3.5 billion.

Trade unions claim their introduction means Britain’s railways are now in public ownership, but that is disputed by the industry.