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    Wales ‘will nationalise its 900-miles of railway’ after bailout talks with current operator collapsed and passenger numbers plummeted during Covid pandemic

    • Talks between the Welsh Government and KeolisAmey reportedly fallen through
    • The pair were in talks about a possible bailout due to the impact of coronavirus
    • The newly renamed ‘Transport for Wales’ is set to take over operation of services
    • It comes amid talks of a bailout between UK ministers and Transport for London 

    The Welsh Government is today poised to nationalise its railways after last ditch talks with its current operator failed, according to reports.

    Welsh political leaders had been in talks with KeolisAmey about a possible bailout due to a fall in passenger numbers in the midst of the Covid-19 pandemic.

    But the negations have now reportedly fallen through, according to the Telegraph.

    The Welsh Government will now take direct control of operations on the country’s 900 miles of railway under state-owned Transport for Wales (TfW), the paper reports. 

    Though the running of the services will now come under TfW, responsibility for tracks and other rail infrastructure will remain in the hands of KeolisAmey – a joint operation made up of Keolis, a subsidiary of France’s SNCF, and engineering contractor Amey.

    While the pair will continue to be responsible for tracks and other rail infrastructure, control of services will be handed back to the state.

    The development came a day after reports on the government’s warning it will take over Transport for London (TfL) unless Mayor Sadiq Khan accepts the terms of a rescue deal.   

    Welsh political leaders had been in talks with KeolisAmey about a possible bailout due to a fall in passenger numbers in the midst of the Covid-19 pandemic

    The Welsh Government will now take direct control of operations on the country's 900 miles of railway under state-owned Transport for Wales (TfW), the paper reports

    The Welsh Government will now take direct control of operations on the country’s 900 miles of railway under state-owned Transport for Wales (TfW), the paper reports

    Ministers threaten to strip Sadiq Khan of control over Transport for London if the mayor does not agree to hike fares and expand congestion zone 

    The government has threatened to take away mayor Sadiq Khan’s control of Transport for London unless he cuts costs and increases fares in return for a rescue package.

    The London mayor needs a £4.9bn settlement to bail out TfL for the next 18 months after passenger numbers collapsed and revenue crumbled as a result of the pandemic.

    The government gave an initial six-month package of support worth £1.6bn to the vast transport authority in May.

    Grant Shapps, the transport secretary, wrote to Mr Khan with a series of demands in return for any financial rescue package.

    According to the Financial Times, the letter demanded Mr Khan increase council tax across the city, expand the congestion charge zone and put in place higher tube and bus fares.

    It also raised the controversial topic of pushing ahead with driverless trains.

    In return, Mr Shapps proposed a six-month funding deal to March 2021 dubbed ‘the H2 deal’ that would be replaced by a longer-term settlement.

    But the transport secretary warned that the government’s support for London would ‘take a different form’ if the two sides failed to strike an H2 deal or if its terms were not met.

    The board of TfL were set to hold a crunch meeting on the settlement yesterday.

    ‘We will be taking reserve legislative powers allowing us if necessary to direct TfL,’ said Mr Shapps in the letter.

    ‘This would be combined with a further series of short-term funding settlements.’

    In a reply on October 6, Mr Khan turned down the set to demands and insisted a rise in council tax for Londoners would ‘place even more reliance on an already broken form of taxation and would be regressive’.

    On expanding the congestion zone, he added: ‘This blunt approach would have a catastrophic effect on the economy of inner London and beyond.’

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    A formal announcement of transfer of operations to state-owned Transport for Wales (TfW) is expected this morning.

    Emergency measures were introduced in March in order to keep trains running during the first six months of the coronavirus pandemic.

    At a cost of at least £3.5billion to the taxpayers, the measures involved the Department for Transport taking on franchise holders’ revenue and cost risks, while paying them a fixed fee for operating trains.  

    The deal expired last month, with a replacement finalised in England in a bid to keep rail services propped-up, while the government also set up a series of shell companies in preperation for operators handing the keys back to the franchises.

    But no such deal was struck in Cardiff. 

    According to reports, Wales’s ‘Operator of Last Resort’ was hastily renamed ‘Transport for Wales Ltd’ last week in anticipation of government officials in Cardiff having to step in. 

    Transport for Wales, Keolis and Amey did not immediately respond to requests for comment.   

    It comes yesterday as ministers in Westminster threatened to take away mayor Sadiq Khan’s control of Transport for London unless he cuts costs and increases fares in return for a rescue package.

    The London mayor needs a £4.9bn settlement to bail out TfL for the next 18 months after passenger numbers collapsed and revenue crumbled as a result of the pandemic.

    The government gave an initial six-month package of support worth £1.6bn to the vast transport authority in May.

    Grant Shapps, the transport secretary, wrote to Mr Khan with a series of demands in return for any financial rescue package. 

    According to the Financial Times, the letter demanded Mr Khan increase council tax across the city, expand the congestion charge zone – which Boris Johnson denied – and put in place higher tube and bus fares.

    It also raised the controversial topic of pushing ahead with driverless trains.

    In return, Mr Shapps proposed a six-month funding deal to March 2021 dubbed ‘the H2 deal’ that would be replaced by a longer-term settlement.

    But the transport secretary warned that the government’s support for London would ‘take a different form’ if the two sides failed to strike an H2 deal or if its terms were not met.

    The board of TfL was set to hold a crunch meeting on the settlement yesterday.

    ‘We will be taking reserve legislative powers allowing us if necessary to direct TfL,’ said Mr Shapps in the letter.

    ‘This would be combined with a further series of short-term funding settlements.’

    Grant Shapps (pictured left), the transport secretary, wrote to Mr Khan with a series of demands in return for any financial rescue package.

    The news comes as the government yesterday threatened to take away mayor Sadiq Khan's (pictured right) control of Transport for London unless he cuts costs and increases fares in return for a rescue package

    The news comes as the government yesterday threatened to take away mayor Sadiq Khan’s (pictured right) control of Transport for London unless he cuts costs and increases fares in return for a rescue package. Grant Shapps (pictured left), the transport secretary, wrote to Mr Khan with a series of demands in return for any financial rescue package.

    In a reply on October 6, Mr Khan turned down the set to demands and insisted a rise in council tax for Londoners would ‘place even more reliance on an already broken form of taxation and would be regressive’.

    On expanding the congestion zone, he added: ‘This blunt approach would have a catastrophic effect on the economy of inner London and beyond.’

    The Government has since been accused of demanding ‘punitive’ conditions to agree the funding deal.

    Mick Cash, general secretary of the Rail, Maritime and Transport union, said: ‘The speculation that the Government are threatening to take direct control of TfL sounds like more bullying by this administration designed to impose their will on Londoners and ride roughshod over local democracy.

    ‘While we await official confirmation on the future funding arrangements for transport in the capital, RMT reiterates our position that we will not tolerate any attacks on jobs and conditions from any quarter as part of any deal.’ 

    Yesterday Boris Johnson launched a furious salvo at Mr Khan, dismissing claims ministers are forcing the London mayor to extend the congestion charge. 

    It is understood negotiations have stalled because of ministers' insistence that any such cash injection depends on the Mayor extending the congestion zone to the North and South circulars

    It is understood negotiations have stalled because of ministers’ insistence that any such cash injection depends on the Mayor extending the congestion zone to the North and South circulars

    The PM railed at Mr Khan for ‘effectively bankrupting’ the capital amid vicious haggling over demands for a £4.9billion bailout for Transport for London (TfL).

    The mayor says the money is needed because coronavirus lockdown has sent fare revenues through the floor.

    But during a stormy session in the Commons, Mr Johnson said Mr Khan’s policies had left a ‘massive black hole’. He denied that the government was ordering an extension of the £15 Congestion Charge Zone to the North and South Circular roads in 12 months’ time.

    ‘Any need to make up that deficit is entirely down to him, it is entirely his responsibility,’ Mr Johnson said.

    ‘Any expansion of the congestion charge or any other measure taken to improve the finances of TfL are entirely the responsibility of the bankrupt current Labour Mayor of London.’

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