New vehicles in the Wales-Border franchise, including new tram and trimodi trains, which can pass for the metro between electric, diesel and battery mode, are on order. Funding for the new roll was taken over by Keolis, a contractual agreement that is being maintained. The Welsh Government made this decision after the end of the rail franchise in England. Normally, we publish research articles ahead of the debates conducted by Senedd members in Siambr (plenary) in order to contribute to an open and well-informed debate in Wales. The turnover model of the Wales franchise and borders has collapsed, as with all franchised railway companies in the UK, due to the Covid 19 pandemic, where passenger numbers initially fell by more than 90% and had only returned to about 30% before the last two weeks of “firebreak” restrictions. In England, the emergency agreement (EMA), now extended for 18 months, covered revenue risks and paid rail operators a flat-rate administration fee of about 3%, with some leeway to do more on the basis of the service. It is a real nationalization. A new public subsidiary of Transport for Wales will take over the daily rail transport from February 2021. The new agreement will also include a new partnership with existing franchise partners, Keolis and Amey. There will be a new funding and operating model, details of which are being developed.
In the longer term, the Welsh Government wants an extension of the tube and similar integrated undergrounds for Swansea Bay and north-east Wales, with an early view to improving public transport in north-west Wales. Both Keolis and Amey could participate in expansions and new Metro projects, although they are expected to undergo procurement processes. Just last month, Keolis UK CHIEF executive Alistair Gordon publicly stated that he had no intention of making the franchise, but that this pandemic and its economic consequences mean things can change quickly. “We have decided to transfer daily rail transport to a new public subsidiary of Transport for Wales. Through a separate infrastructure company, KeolisAmey will continue the next phase of the Metro project, with the electrification of the Central Valley lines in Cardiff, as well as the Coryton and City Lines in Cardiff. This project, for which Transport for Wales has asked HMRC for VAT exemption, has a closed budget of USD 738 million (including VAT 20%). KeolisAmey became a franchisee by Wales and Borders in 2018 and worked at Transport for Wales Rail Services. We are a research and information service based in the Welsh Parliament. The expected profit margin for the electrification of Valley Lines is not affected by the operating changes in the franchise. In March, the Core Valley Lines, partly the City Line and the Coryton Line, were entrusted to the Welsh government to carry out the next phase of the metro via KeolisAmey. In the event of a flat-rate management fee that would have been further reduced. KeolisAmey will receive nothing and will effectively return the day-to-day rail operations in Wales to the new public unit, which will enter service from next February.
The Welsh government continues to commit to delegating the entire rail network, with a funding agreement that takes into account billions of pounds of investment in rail improvement projects that go back decades. He said the most generous spending in Wales is estimated at $2.2 billion, which implies a $755 million barnett sequence from an increase in the Department of Transport`s total budget in 2015.