Franchise agreements for railway operators have been suspended to facilitate Emergency Measures Agreements (EMAs) allowing Downing Street to help companies bear the financial strain as social distancing procedures during the coronavirus epidemic, the UK Department for Transport said in a statement.
According to the announcement, operators will continue their daily services for a small "predetermined management" fee, with employment terms and conditions remaining unchanged.
Fees have been set at 2 percent of franchising costs prior to the pandemic and aim to help operators "meet reliability, punctuality and other targets", with government Operators of Last Resort stepping in should some companies refuse EMAs.
Advance ticket holders will be granted refunds free of charge, with season ticket holders allowed reimbursements for "time unused on their tickets".
The news comes as railways reported an up to 70 percent decrease in passengers and a two-thirds drop in revenue as workers operate remotely and social distancing measures are enforced, the government said in its announcement. Train operators entered talks with the government after falling profits sparked fears from railway bosses, the BBC reported on 15 March.
Response To Downing Street Actions Against the Coronavirus Threat
UK Secretary of State for Transport, Grant Shapps, said that the government was taking the measures to protect key workers using railways to "carry on their vital roles", as well as commuters and "frontline staff" helping to keep the "country moving".
"People deserve certainty that the services they need will run or that their job is not at risk in these unprecedented times. We are also helping passengers get refunds on advance tickets to ensure no-one is unfairly out of pocket for doing the right thing. These offers will give operators the confidence and certainty so they can play their part in the national interest," He said.
Chief executive of the Rail Delivery Group, Paul Plummer, said that the rail industry was cooperating amid the "unprecedented national challenge" to help transport "key workers to hospitals, food to shops and fuel to power stations", among others.
"The industry strongly welcomes the Department for Transport’s offer of temporary support and while we need to finalise the details, this will ensure that train companies can focus all their efforts on delivering a vital service at a time of national need. We would like to thank our people, who continue to do an incredible job in difficult circumstances," he added.
Tim Shoveller, managing director of Network Rail's North West and Central (NW&C) region, pledged to Europe's largest mixed-use railway railway open over the coming months.
Considered the 'Backbone of Britain', the NW&C runs from London Euston to major cities and regions across the country, up to Cumbria and Glasgow, including the West Coast main line.
“Our role in Britain’s Coronavirus response is clear - to keep key workers, including in the NHS and emergency services, as well as food, fuel and medicine moving safely as together we rise to this challenge," he said.
He added that Network Rail was working to support railway workers, "especially those in critical frontline roles" to aid the nation "in its hour of need".
He added: “The West Coast main line is the Backbone of Britain, the artery connecting London, Birmingham, Liverpool, Manchester and Glasgow. We must keep it open to ensure vital supplies and key workers get where they're needed. And that is what we will do.”
The measures come after UK prime minister Boris Johnson announced in March a wave of measures to support the UK, including closing schools, urging social distancing protocols, and shutting down non-essential travel, among others.
UK Chancellor for the Exchequers, Rishi Sunak, also unveiled a £330bn emergency relief fund to back UK businesses amid the pandemic, including grants up to £25,000 per small business, with furloughed workers qualifying for up to £2,500 a month under the government's Coronavirus Job Retention Scheme.
Private renters would be shielded from evictions and given increases in Universal Credit of £1,000 each year, Mr Sunak said.
The offers were made after the Confederation of Business Industry and Federation of Small Businesses urged No 10 to provide relief for workers on Friday amid fears of a looming recession and strains on the national workforce due to the pandemic.