Operator of last resort

An operator of last resort is a business in the United Kingdom that operates a railway franchise on behalf of the government when a train operating company (TOC) is no longer able to do so, and it is nationalised on an interim basis. Since the last appointment in June 2023, there are now six such operators of seven rail services in England, Wales and Scotland. In December 2024, following new legislation in November, it was announced that the first of the remaining contracted TOCs would be taken back into public ownership in May 2025.

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 negotiated 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.^[1]

Should that not be possible, the Department for Transport (DfT) in England (through DfT Operator), the Scottish Government (through Scottish Rail Holdings) for the ScotRail franchise in Scotland, and the Welsh Government for the Wales & Borders franchise in Wales, are required to step in as operator of last resort.

Structure

In July 2009, the DfT established Directly Operated Railways (DOR) as its operator of last resort for England.^[2] In November 2015, the DfT wound up DOR and appointed a partnership of Arup Group, Ernst & Young and SNC-Lavalin Rail & Transit.^[3]

Utilisation

Since privatisation occurred in the mid-1990s, there have been nine occasions when an operator of last resort has been appointed. As of December 2024^[update], the government has announced plans to hand over three more services to the operator of resort in 2025,^[4] with an expectation that the hand over of all train operating companies' services, excluding open-access operators, will be completed by October 2027.^[5]

Current

• London North Eastern Railway has operated the InterCity East Coast franchise since 2018, after Virgin Trains East Coast defaulted.^[6]
• Northern Trains has operated the Northern franchise since 1 March 2020, after the Arriva Rail North franchise was terminated by the Department for Transport.^[7]
• Transport for Wales Rail has been the Welsh Government's operator of last resort since 7 February 2021, after the Wales & Borders franchise operated by KeolisAmey Wales became unviable as a result of the COVID-19 pandemic.^[8]
• SE Trains has operated the South Eastern franchise since 17 October 2021, after the previous Govia-owned operator Southeastern (legally London & South Eastern Railway) was stripped of the franchise for not declaring £25 million of revenue.^[9] The new operator has continued to use the Southeastern brand.
• ScotRail, controlled by Scottish Rail Holdings for Transport Scotland, has run the ScotRail franchise since 1 April 2022, after Transport Scotland announced that Abellio ScotRail's seven-year contract was to be terminated early because of poor performance.^[10]
• TransPennine Express took over from First TransPennine Express Limited on 28 May 2023 after the DfT terminated the contract on the grounds of poor service.^[11][12]
• Scottish Rail Holdings took over Caledonian Sleeper from the incumbent operator, Serco, on 25 June 2023.^[13]

• South Western Railway took over the First/MTR operated South Western Railway in May 2025.^[14] The South Western area was the first under legislation approved in November 2024.^[14][4]

Future

• c2c (2025) will taken over from c2c (Trenitalia) bringing it back into public ownership on 20 July 2025.^[4]
• Greater Anglia (2025) service will be taken back into public ownership on 12 October 2025.^[4][15]

Past

• South Eastern Trains operated the South Eastern franchise from 2003 to 2006 after the Connex South Eastern franchise was terminated by the Strategic Rail Authority.^[16]
• East Coast operated the InterCity East Coast franchise from 2009 to 2015 after National Express East Coast defaulted.^[17]