RIA calls on Chancellor to keep investing in rail
THE APPOINTMENT of Jeremy Hunt as Chancellor of the Exchequer – and the severe financial fallout from the ‘mini budget’ made by former Chancellor Kwasi Kwarteng – has seen the chair of the Railway Industry Association, Darren Caplin, pen an open letter to the new Chancellor calling on him to not reduce spending on rail. With the Government reversing many of the announcements made under Liz Truss’s premiership, there were widespread fears that cost-cutting and a spending review could see planned rail projects either cancelled or scaled back.
Mr Caplin wrote: “I am writing to you on behalf of trade body the Railway Industry Association and our rail supply sector members.
“We of course understand that there are incredibly difficult decisions to be made on the economy in the coming weeks and months. We wanted to point out to you and your officials that in terms of public spending, rail represents impressive value for money.
“A study published last year, commissioned by RIA and conducted by Oxford Economics, shows that the railway industry is an essential generator of economic growth, jobs, and investment.
“In the UK, rail supports 710,000 jobs, contributes over £43 billion Gross Value Added, provides up to £800 million in exports, and for every £1 spent on rail, £2.50 of investment is generated elsewhere in the economy. “This means that rail is not just an important industrial sector in its own right; it also plays a major role in boosting economic growth in other sectors too, as well as connecting and levelling-up the country.
“Simply, rail is the cleanest form of mass transport and with the Government’s currently planned investments will be able to contribute even more strongly to Net Zero and green, highly skilled jobs.
“Rail also provides £14 billion in tax revenue to the Treasury, meaning that annually it pays its way. So, our ‘ask’ is simple: we ask that in your deliberations on spending in the coming days you and your officials regard rail as a generator of jobs, GVA, catalytic investment and tax revenues, and not simply as a cost on the public purse.
“We also urge you to look to the longer term: building rail for the next 20 to 30 years – to deliver the capacity we are going to need in the future – means we should not take our foot off the pedal on investment now.
“Rail renewals, enhancements, rolling stock investments, and major projects like HS2, Northern Powerhouse Rail, Midlands Rail Hub and East West Rail will all generate jobs, GVA and growth both today and in the years to come.”