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      "text": "The further forwards one looks the more difficult it becomes to forecast accurately. As such, for long franchises there would be very significant uncertainty at the time of bidding regarding the costs, revenues, train services and management initiatives that will actually occur during the later years of franchises",
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      "text": "If franchise bids are used as the TOC baseline then it would almost certainly require a number of adjustments at various stages during the franchise to take into account emerging developments",
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      "text": "The DfT's revenue share / support mechanism is thought to have led to some overstated bid revenue lines but the DFT has announced that it will not include any cap and collar based mechanisms in future franchises",
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      "text": "The DfT is currently undertaking a review of franchising policy and has announced a move to longer franchises (typically 15 – 22.5 years). However, many important features of its new approach to franchising remain to be finalised as it will determine many things on a franchise-by-franchise basis. As a result, there is currently a state of uncertainty so it is difficult to be definitive over the suitability of franchise bids for use as the TOC baseline for a cost and revenue sharing mechanism",
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      "text": "As such, there may not be a big difference between TOCs' (re-stated) franchise bids and their ongoing business plans",
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      "text": "The key benefit to using franchise bids as the TOC baseline is that they are developed under competitive pressure but in the knowledge that the company will have to deliver them if they succeed in winning the franchise. As such, they should be efficient but achievable",
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      "text": "3 – Baseline: The cost and revenue sharing mechanism could either use franchise bids or TOC business plans as the TOC baseline. If franchise bids are used then they would almost certainly require a number of adjustments at various stages during the franchise to take into account emerging developments",
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