Network Rail outlines £10bn investment plan

Network Rail today set out its proposals for a £10.5bn capital investment plan for the five years between 2014 and 2019.

The plans, which have to be assessed and agreed by both the government and the rail industry regulator, will if accepted pay for the completion of the Crossrail and Thameslink upgrades, as well as a range of new capital programmes including the £560m Northern Hub project.

The funding, for what Network Rail calls Control Period 5 (CP5), is a 11% cut from the £11.8bn investment package for the current control period, CP4, which runs from 2009 to 2014. However, the cut is less than the efficiency savings of 16% Network Rail is anticipating it will be able to make through better procurement and more collaborative working over the period.

The £10bn funding package includes £4.9bn of existing commitments, including Crossrail, Thameslink, the electrification of the Great Western Railway and the rebuilding of Birmingham New Street.

It also includes an additional £5.6bn for new projects. These include:

• The Northern Hub - a £560m scheme to deliver over 700 more daily services between Leeds, Manchester, Liverpool, Newcastle and Sheffield
• Electrification of the Midland main line, North Trans-Pennine, Cardiff Valleys and further schemes in Scotland
• Improvements for medium-to-large- size stations such as Fenchurch Street, Wimbledon and Liverpool Central
• Investment in freight capacity to deliver a 30% increase in freight tonne kilometres

£200m scheme to improve journey times and increase the numbers of services to and from Inverness and Aberdeen and to the commuter network of the two cities

New operating strategy - moving from 800 signal boxes to 14 modern signalling centres (30 year time-frame)

Paul Plummer, group strategy director at Network Rail, said he was confident the plan would be taken seriously by government. “In the past we have got a large proportion of what we asked for from these proposals, although in some cases at a different time. I think we’ve ended up with quite a degree of credibility within government, particularly as regards to what schemes, as opposed to how much funding, should be supported.”

Plummer said Network Rail was making the case to government that the go ahead for the High Speed 2 line from London to Birmingham, which is treated separately to this plan, should not be a reason to lower investment in the rest of the network.

The plan also covers the operational and maintenance costs of the UK rail network. In total it envisages spending of £20.2bn in the operation and maintenance of the network, making efficiency savings of 16%. This is at the bottom end of the efficiency savings requested in the review of the Netowkr by Sir Roy McNulty, published earlier this year.

Plummer said it would only be possible to go further than that if the government went ahead with radical changes in the way Network Rail works with train operators.

The document now goes into a process to get ratified, leading to a final determination by the rail regulator, the ORR, in October 2013.

Michael Roberts, chief executive of the Association of Train Operating Companies said: “Rail has a bright future in supporting a successful green economy in the years ahead. This plan shows how we can do that by providing a better quality of service to growing numbers of passengers at a more affordable cost.”

Alasdair Reisner director of external affairs at the Civil Engineering Contractors Association, said: “With the rail sector currently playing a crucial role in supporting output in the UK infrastructure sector, many contractors will have an eye on the likely shape and size of the market after 2014. We welcome the continuing push for investment in the network, and the work that Network Rail has done with industry to drive greater efficiency.”