DfT Operator

2018–2023: Establishment as operator of last resort

DfT OLR Holdings Limited was incorporated in May 2018 by the Department for Transport (DfT) as a government-owned holding company to enable the UK Government to take control of passenger rail services in England where a franchise contract was either terminated or not renewed.[4] It succeeded Directly Operated Railways, which had carried out the same function between 2009 and 2015 when it operated the InterCity East Coast franchise; that company was wound up after the route was re-franchised, leaving the government without a standing operator of last resort structure until the creation of DfT OLR Holdings.[5] Through DfT OLR Holdings, the DfT manages train operating companies that are placed into public control.

The model was first used on 24 June 2018, when London North Eastern Railway replaced Virgin Trains East Coast following the early termination of the InterCity East Coast franchise due to financial difficulties.[6] On 1 March 2020 the DfT transferred the Northern Trains operation into operator of last resort management, replacing Arriva Rail North after a period of sustained performance issues and financial instability.[7] This was followed on 17 October 2021 by the transfer of Southeastern after the discovery that the incumbent operator had failed to declare significant revenue to the department, constituting a breach of its franchise agreement.[8] A further transfer took place on 28 May 2023, when TransPennine Express was placed under operator of last resort management after the DfT decided not to renew the FirstGroup contract following prolonged service cancellations and poor performance.[9]

By mid-2023, the four operators managed through DfT OLR Holdings made the company the third-largest passenger rail operator in Great Britain by revenue and the largest by passenger mileage, accounting for 23% of passenger revenue and 26% of passenger kilometres.[10]

2024–present: Expansion and role in public ownership

Following the 2024 United Kingdom general election, the Labour Party formed a government with a manifesto commitment to renationalise the railways. This was to be implemented through two pieces of legislation, the Passenger Railway Services (Public Ownership) Act 2024 which empowered the government to take over passenger rail services as contracts expired and made the government the preferred operator of rail services and a forthcoming Railways Bill which would bring the existing train operating companies together with Network Rail into a single state-owned body, Great British Railways.[11]

The Passenger Railway Services (Public Ownership) Bill was introduced to Parliament in July 2024 by then Secretary of State for Transport Louise Haigh. The bill subsequently passed Parliament later in 2024. Following its passage the Department for Transport announced that DfT OLR Holdings Limited would be renamed DfT Operator Limited, reflecting its expanded role as the government's primary operator of passenger rail services returned to public ownership.[12]

The government chose to allow private operating contracts to expire rather than buying them out, enabling services to transfer into public ownership at no cost to the government.[11] The first operators announced for transfer under this policy were South Western Railway, which transferred on 25 May 2025,[13] c2c, which transferred on 20 July 2025,[14] and Greater Anglia, which transferred on 12 October 2025.[15]

In November 2025, the Secretary of State for Transport Heidi Alexander introduced the Railways Bill to Parliament as part of the government's wider rail reform to establish DFT's future successor, Great British Railways. Around the same time, Alex Hynes was appointed chief executive of DFTO, succeeding Robin Gisby, to oversee the organisation's expansion and its transition into Great British Railways.[16] In addition, around 200 staff from the Department for Transport were scheduled to transfer into DFTO by April 2026.[16]

Further transfers continued in 2026. West Midlands Trains transferred into public ownership on 1 February 2026 following the expiry of its contract.[17][18] It is expected that the remaining privately operated train operating companies, including Avanti West Coast and CrossCountry, will transfer into public ownership by October 2027 as their contracts expire.[11]