the franchise came up for renewal, reflecting the exclusive nature of the two lines - being largely isolated from the rest of the National Rail network and with no through passenger services to/from outside the Merseyrail network, the decision was taken to remove it from the national framework and bring it into local control. As a result, using the Merseyrail Electrics Network Order 2002 the Secretary of State for Transport exempted the system from being designated as a railway franchise under the privatisation legislation (the Railways Act 1993). This allowed the PTE to contract out the lines themselves, which it did with Merseyrail operated by Serco-Abellio commencing a 25-year contract on 20 July 2003. Unlike most rolling stock that is owned by private sector rolling stock companies, Merseytravel will outright own the Class 777 fleet, operated by Merseyrail. The current Class 507 and Class 508 fleets are owned by Angel Trains and leased to Merseyrail. Merseytravel City line A third line, the City line, also historically branded as Merseyrail under British Rail, was also privatised under the 1993 Act, but as part of the much larger North West Regional Railways (NWRR) franchise. On 2 March 1997, North Western Trains, later rebranded First North Western, commenced operating the franchise. Some Class 142 units were repainted in Merseytravel's yellow livery. This line was not included in the 2003 exemption given to the other two lines, and so it has continued as part of the government-administered rail franchise system, although the role of PTEs in the franchising process has altered due by the 2005 Railways Act. From 11 December 2004, the NWRR franchise was merged into a new Northern franchise and operated by Northern Rail. The Merseyrail Class 142 units were repainted into Northern Rail livery. On 1 April 2016, the franchise was taken over by Arriva Rail North. Bus services Prior to the Transport Act 1985, which nationally mandated the deregulation and privatisation of bus services in 1986 throughout England except Greater London, it operated a large proportion of the bus services on Merseyside, under the Merseyside Transport brand. It had taken over the municipally provided bus operations of Liverpool, Birkenhead and Wallasey county borough corporations in 1970, and expanded to cover the county borough municipal corporation areas and bus services of St Helens and Southport in 1974. The PTE also extensively co-ordinated and joint operated bus services on Merseyside with National