£35bn for UK rail

Rail (UK) - - Contents - Philip Haigh philip.haigh@bauer­me­dia.co.uk Con­tribut­ing Writer

Net­work Rail al­lo­cated £34.7bn to spend on its tracks, sig­nalling and struc­tures over 2019-24.

NET­WORK Rail will be able to spend £34.7 bil­lion to op­er­ate, sup­port, main­tain and re­new its tracks, sig­nalling and struc­tures over the five years from next April.

That’s the fi­nal con­clu­sion of sev­eral years of work by the Of­fice of Rail and Road, known as Pe­ri­odic Re­view 18 (PR18), and which sets the charges Net­work Rail can levy on train and freight op­er­a­tors once grants from the Depart­ment for Trans­port and Trans­port Scot­land are taken into ac­count.

NR’s spend­ing in Scot­land is £3.672bn, which com­pares with the £4.85bn Scot­tish min­is­ters are mak­ing avail­able to op­er­ate, main­tain and re­new its net­work and com­plete those projects listed for 2014-19. In Eng­land and Wales, the DfT’s spend­ing lim­its for NR are £47.9bn in to­tal for en­hance­ments, with £34.7bn set as the limit for the com­pany’s di­rect grant.

ORR Chief Ex­ec­u­tive John Larkin­son said: “These plans are fo­cused on im­prov­ing per­for­mance for pas­sen­gers and freight op­er­a­tors by get­ting the ba­sics right - en­sur­ing that the rail­way is prop­erly main­tained and re­newed, and on im­prov­ing the daily op­er­a­tion of the rail­way.

“There is no time to lose. Net­work Rail and, in par­tic­u­lar, the routes and Sys­tem Op­er­a­tor must make sure they are ready to de­liver from day one of the new Con­trol Pe­riod. That is why we have and will con­tinue to re­port on - and where nec­es­sary chal­lenge - Net­work Rail’s readi­ness.”

For the first time, ORR has split its set­tle­ment ge­o­graph­i­cally by NR routes, to per­mit more de­vo­lu­tion to route manag­ing di­rec­tors and to bet­ter hold the com­pany to ac­count. The big­gest spender is set to be NR’s Lon­don North Western Route (£8.7bn) and the small­est will be Wales with £2.0bn (see ta­ble).

The five years from next April com­prise Con­trol Pe­riod 6 (CP6), and are set to in­clude a sharp in­crease in the re­newals that Net­work Rail will un­der­take, de­spite con­cerns from ORR about the pro­file of this work and NR’s readi­ness to start in April.

“We re­main con­cerned about Net­work Rail’s plans which con­tinue to show a sig­nif­i­cant ramp-up in the mid­dle of CP6, with a fall over the longer-term,” the reg­u­la­tor said.

ORR has ac­cepted NR’s plans to in­crease re­newals spend­ing by 17% in Eng­land and Wales to £14.6bn. In Scot­land, re­newals spend­ing rises from £1.6bn to £2.0bn.

ORR is in­tro­duc­ing a new per­for­mance mea­sure for NR that takes it away from tra­di­tional punc­tu­al­ity tar­gets that are eas­ily un­der­stood by pas­sen­gers. In their place comes a mea­sure called ‘Con­sis­tent Route Mea­sure for Pas­sen­gers’ (CRM-P). ORR says it will mea­sure NR’s con­tri­bu­tion to de­lays ex­pe­ri­enced by pas­sen­gers. Over the past year, NR routes have de­liv­ered CRM-P per­for­mance vary­ing be­tween 1.0 and 4.0. Over CP6, each route is re­quired to grad­u­ally im­prove.

ORR pushed NR to agree per­for­mance tra­jec­to­ries with each of its pas­sen­ger op­er­a­tor cus­tomers as it de­vel­oped PR18. Mea­sured in PPM (Pub­lic Per­for­mance Mea­sure), ORR has now pub­lished tra­jec­to­ries for four op­er­a­tors, af­ter NR was un­able to agree them with oth­ers. The four are Ar­riva Rail Lon­don (95.0% by the end of 2023-24), c2c (96.5%), Merseyrail (95.6%) and Great Western Rail­way (89.9%). In Scot­land, NR must de­liver 92.5% PPM for ScotRail and 80% right-time ar­rivals for Cale­do­nian Sleeper.

De­spite the moves to­wards de­vo­lu­tion, ORR has al­lowed NR to strengthen its cen­tralised Sys­tem Op­er­a­tor func­tion that con­ducts strate­gic plan­ning as well as timetabling.

Sys­tem Op­er­a­tor re­ceived se­vere crit­i­cism in a re­cent re­port by ORR Chair­man Stephen Glais­ter, fol­low­ing last May’s timetabling melt­down. Sys­tem Op­er­a­tor is now to be al­lowed to add 100 staff to its 700-strong timetabling team and spend £270m over CP6, which ORR de­scribes as a sub­stan­tial in­crease. “These ex­tra re­sources need to be used wisely,” said ORR.

Track ac­cess charges will change as a re­sult of PR18. ORR said that charges for freight and char­ter op­er­a­tors will rise by 1.9% and 1.0% re­spec­tively in each of the last three years of CP6, hav­ing been held for the first two. ORR added that it ex­pects freight op­er­a­tors and char­ters to pay their full wear and tear costs by the end of CP7 (2029).

Charges to re­cover NR’s fixed costs will also change, with charges to be levied on open ac­cess op­er­a­tors run­ning in­ter-ur­ban trains. ORR said this was to sup­port com­pe­ti­tion be­tween pas­sen­ger op­er­a­tors, and ex­plained that such op­er­a­tors would re­ceive greater op­por­tu­ni­ties for ac­cess in re­turn.

NR now has un­til March 31 2019 to pub­lish its CP6 de­liv­ery plan. Oc­to­ber 31’s pub­li­ca­tion of ORR’s fi­nal de­ter­mi­na­tion of NR spend­ing and charges fol­lows last sum­mer’s draft de­ter­mi­na­tion, which has been the sub­ject of dis­cus­sion be­tween ORR and NR since then. The changes in PR18 take ef­fect in April 2019, but NR can ob­ject which could lead to a re­view by the Com­pe­ti­tion and Mar­kets Author­ity.


Un­der plans ap­proved by the ORR, Net­work Rail’s Lon­don North Western Re­gion will have the largest pot of fund­ing to spend dur­ing the next five years, with al­most £9 bil­lion avail­able. On Au­gust 27, NR’s New Mea­sure­ment Train, led by 43062 John Ar­mitt, passes Rib­ble­head.

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