HS2

08.09.16

Network Rail should ‘behave like a business’ with private funding – Carne

The rail industry cannot rely entirely on public funding to continue to drive regeneration, Network Rail boss Mark Carne has said, as he called on businesses to play a “much bigger role” in funding projects and laid down his vision for the infrastructure owner to “behave like a private sector business”.

Speaking at a London First event on Tuesday, he outlined the importance of business investment in the railways as a source of funding to ensure investment can continue to transform the industry – echoing the opinions of other rail heavyweights, such as Network Rail chairman Sir Peter Hendy and Crossrail 2 boss Lord Adonis.

“We know that rail can unlock housing supply to bring communities that have traditionally been cut off within reach of major urban conurbations,” he said. “Just yesterday we announced that we have identified almost 200 sites across the country which will deliver almost 12,000 new homes, and we are continuing to review our land assets to see what more we can do.

“All over the country, we have seen the impact of rail improvements, new stations, new lines. When railways are introduced or upgraded, investment in housing inevitably follows as businesses choose to move or set up in or near those areas.

“We know that rail investment, such as transforming stations, can drive regeneration. But we cannot continue to rely on public funding to do so. It is clear that we need to increasingly source funding from those people, authorities and businesses that directly benefit from better railways.”

Although Network Rail is a public sector organisation, Carne argued his vision is that “we behave like a private sector business – relentlessly customer focused, cost-competitive, commercial and with a high-performance culture and a plan to deliver a railway fit for the future”.

“Transformation is not a choice, it is a necessity,” he added.

Digital railway as a priority

The infrastructure owner boss did acknowledge, however, that running more services as a direct result of growing demand led to “serious congestion” on key routes in the country, particularly at peak times, which in turn impacts on punctuality and reliability.

But looking to the future, he said Network Rail plans to be able to run “many more trains” on the current infrastructure without actually building more tracks – instead focusing on digital technology, similarly to that used to transform the Victoria and Jubilee lines in the capital.

Carne made similar remarks during a Transport Committee hearing earlier this year, where he argued delivering a digital railway will be the cheapest option for increasing capacity by up to 40%. While he had accepted that new-build projects like Crossrail 2 and HS2 would still be necessary in the overall rail vision, he made clear that digitising signalling would ultimately be responsible for transforming the way the network is handled.

But the Digital Railway programme is expected to be led at a cautious pace after its managing director David Waboso said it should be introduced in stages to allow time to learn from mistakes and avoid an “over-heroic” approach. More recently, he told RTM that Network Rail will revise the Digital Railway’s Norwich – Yarmouth – Lowestoft (NYL) pilot which was being designed to showcase the full deployment of digital technology by the end of CP5.

  

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Comments

Lutz   09/09/2016 at 00:26

It is hard to see how this can be achieved on a large enough scale to make it effective. If an investment fund was to invest in the infrastructure say, they would want control of the assets. Perhaps one area in which it might work is in developments over currently under-developed stations and yards. Wimbledon is perhaps a good case - there is a very extensive area that could take a raft development over the stations and approaches and with it's location there is the potential for a significant investment. However how would this work with plain line - unless ownership was transferred. Another area perhaps is the future digital control systems - much like air traffic control is separate from the operators. There are lots of ideas but little enough detail to see how they might work.

Wimg   09/09/2016 at 11:58

" But looking to the future, he said Network Rail plans to be able to run “many more trains” on the current infrastructure without actually building more tracks – instead focusing on digital technology, similarly to that used to transform the Victoria and Jubilee lines in the capital. " Mr Carne is talking about digitalising Metro-systems. What about the 140 MPH the new Hitachi trains are expected to do , if they ever get that far , we're talking about ERTMS , is also a pain in the neck ..

Andy   09/09/2016 at 14:04

Sorry but Network Rail has a lot of internal issues to address before they could ever consider working in the real world of a private sector and survive without the continues Government bailouts! Business ethics would be a good start and appreciating the importance of their stakeholders including suppliers who are disillusioned with the rail industry and leaving in droves? Good luck Mark.

John Grant   09/09/2016 at 14:45

By all means run the railways like a business, rather than a branch of the Civil Service. But why use private finance when governments can borrow so much more cheaply? All it needs is to change the accounting rules a bit, so infrastructure investment looks the same as the liability for future PFI fees rather than being counted as part of the national debt.

Stewart   09/09/2016 at 14:51

I agree with Mark And would add that the aniquated workability of rail is so negatively engrained a large change of top and middle management is required. They are some 30 years behind management processes as are some of the main contractors who think they can manage biased rail contracts without finding themselves tens of millions of pounds in the red. Crisis management seems to be the order of the day. Woefully inadequate business practices persist at the needless expense of the taxpayer..

Ler   10/09/2016 at 17:58

Lol! you've got to give it (satanraill) the chutzpah is astounding A PUBLIC SERVICE A BUSSINESS???????????

David Faircloth   12/09/2016 at 17:25

In a way, he's saying that Network Rail should operate like BR did! It was approached in (at least) two ways. Firstly, there was a guy in its Director of Funds who was responsible for identifying projects which could be funded/partially funded by third parties, such as the EU Structured Funds; contributions were received from the EU towards the cost of the ECML electrification scheme, some Channel Tunnel works, etc. Secondly, the BR Property Board brought in much revenue by selling off unwanted land or in having sites developed for the mutual benefit of the railway and the developers; City Thameslink station (and the putting underground of the adjacent section of the Thameslink route) and Broadgate/Liverpool Street are examples of the latter - Broadgate even included the electrification of some lines in East London and the construction of the Graham Road curve - and the National Library and the Wyvern Business Park in Derby are just two examples of the former. I guess one of the problems Network Rail is having is that BR was so good at it, there isn't much left to sell or develop!

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