Industry

31 OCT 2018

RAIL REGULATOR APPROVES NETWORK RAIL’S £35BN PLANS TO BOOST UK RAILWAYS

With five months to go before Network Rail enters its next five-year phase of funding, the Office of Rail and Road (ORR) has given the green light to £35bn plans to make the UK’s rail network more reliable and more focused on passengers’ needs.

Control Period 6 (CP6) is set to commence on 1 April and the ORR has backed plans for increased investment in research & development (R&D) with a GB-wide fund of £245m to be spent on projects with £26m funded by the Scotland route settlement.

The final determination documents state how the UK rail network has supported more than a doubling of passenger journeys over the last 20 years, while franchised passenger revenues have risen by 135% in real terms. This means funding needs to be set aside to ensure ongoing maintenance and renewal is kept at the forefront.

A total of £4bn is ring-fenced for Scotland’s railways and the regulator has set out what Network Rail will be expected to deliver in Scotland. Specific measures include delivering journey time improvements for both passenger and freight operators and achieve a punctuality target of 92.5%.

Breakdown of funding:

ORR says while conducting the review it has consulted widely and received valuable contributions and responses from stakeholders, including consumer groups, industry, and Network Rail. After consultation, it has confirmed plans to simplify industry charges and incentives, including scrapping outdated mechanisms and capping charges for freight and charter operators.

Commenting on the final determination, John Larkinson, ORR chief executive, said: "Today’s decisions mean that Network Rail, the Scotland route and the system operator can now implement their plans to deliver a service which passengers and freight customers rightly demand and deserve. These plans are focussed 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. With only five months until the start of CP6, it is important that the Scotland route is ready to deliver from day one of the new control period on the priorities set for Scotland."

Responding to the ORR's approval, Darren Caplan, chief executive of the Railway Industry Association (RIA), said: “The Railway Industry Association welcomes the publication of today’s Final Determination, and we are encouraged to see the ORR taking the concerns of the rail supply community onboard, particularly around ‘boom and bust’ funding. This impacts rail businesses’ ability to recruit and invest and jeopardises the ability of SMEs in the industry to survive. It also increases the cost of running the rail network by up to 30%, which is bad for taxpayers, passengers and freight users.

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