Railway cuts…
Industry leaders warn cuts to services are inevitable if rail continues to suffer from low passenger numbers…
RAILWAY leaders have praised the Government for pumping billions of pounds into the industry to maintain services during the pandemic. But they warn that cuts to investment and reductions in services will be inevitable if passengers fail to return in large numbers, with the Treasury unwilling to pay for frequent trains that carry few travellers.
Speaking at the Railway Industry Association annual conference, Network Rail Chairman Sir Peter Hendy said: “You have to give the Treasury a huge amount of congratulation for the support it has offered our industry. It is a measure of how vital the railway is thought to be for the economic health of the country.”
However, he added that Crossrail 2, the proposed route across London to ease pressure on Waterloo and Liverpool Street, could be off the agenda for “ten to 15 years”.
NR Chief Executive Andrew Haines added that schemes to provide western and southern rail access into Heathrow were also likely to face lengthy delay.
Hendy stated: “Andrew and I are concerned at the cost of the railway, and the disparity between the cost and the revenue over the last eight months.
“I suspect the demand has been permanently altered. But the Government could have asked us to cut the service to match the revenue. It hasn’t.” Sir Peter Hendy CBE, Chairman, Network Rail
“The Government has been absolutely consistent in its support. But I think there is going to be an increasing economic pressure on the railway. We may, in the medium term, have to manage services differently.
“I suspect the demand has been permanently altered by this. But the Government could have asked us to cut the service to match the revenue. It hasn’t.”
Speaking at the online conference, Haines added:
“We are going to face some financial restraint. At the peak, the Government was giving the railway £900 million a month
- not paper money, but real taxpayers’ money. That cannot be sustained.
“We are fortunate that the true cost of borrowing for the Government at the moment is staggeringly low. We have to persuade the Government that rail is a good place to invest, relative to other infrastructure. That is in our hands - we have to prove that we are efficient, and that we can deliver at lower cost and offer value for money.
“The railway has relied in the past on inexorable growth in passenger numbers. That has gone. We don’t know whether future demand will be 60, 70, 80 or 90% of the previous level. But they are not asking us to make irrational cuts or slim down services.”