Operator of last resort


An operator of last resort is a business in the United Kingdom that operates a railway franchise in the event that a train operating company is no longer able to do so.

Purpose

Under the Railways Act 1993, which privatised passenger operations in the United Kingdom, the government is required to maintain continuity of passenger rail services if a franchise is terminated. In some instances, the government has been able to negotiate for the existing franchisee to continue to operate the franchise on a management contract until it can be relet, as happened when GNER defaulted on the InterCity East Coast franchise in 2007.
Should this not be possible, the Department for Transport is required to step in as the operator of last resort.

Structure

In July 2009, the DfT established Directly Operated Railways as its operator of last resort. In November 2015, the DfT wound up DOR and appointed a partnership of Arup Group, Ernst & Young and SNC-Lavalin Rail & Transit.

Utilisation

Since privatisation in the mid-1990s there have been four occasions when an operator of last resort has been required to step in: