Rail Industry Focus

07.07.17

Moving towards deep alliances

RTM’s Luana Salles reports from one of the Platform sessions at this year’s Railtex, where rail leaders touted the benefits of delivering infrastructure projects via innovative deep alliances.

There is no doubt that delivering projects using deep alliances between contractors and suppliers, similar to what will be trialled with East West Rail, produces better results, rail bosses resoundingly argued at this year’s Railtex. 

Chris Curtis, head of Crossrail 2 at Network Rail, said that in the schemes he’s been involved in over the last 20 years, there is “no doubt that where we work closer together it results in more successful projects”. 

“Yes, there are some that challenge that rule, if you’d like, but generally those that formed an alliance have delivered well,” he told delegates participating in one of RTM’s Platform sessions during the exhibition. “The involvement of contractors in the early stages of projects clearly helps with that. 

“The thing for me is, franchisees don’t have lots of capital, and therefore, using the mortgage example, they can only repay the mortgage for a certain amount of time. So, these innovative ways of working have got to work.” 

The infrastructure owner just wants to see the network developed, he added, but is aware that it won’t get all the money needed – meaning these alliances are imperative working models to the successful and cost-effective delivery of projects. 

David Hoggarth, director of Rail North, agreed with Curtis, revealing that although nothing is ready to go just yet, similar opportunities are being considered in the north. 

“My understanding is that some of the most successful projects on the go, like the Ordsall Chord – the big new piece of infrastructure in Manchester, running on time and on budget – have quite an innovative structure with the contractors and Network Rail embedded in a very deep alliance relationship, where everybody shares the pain and the gain,” he explained. 

“And the feedback I get is that it’s a model that works very, very well, as opposed to the more traditional contractor/supplier arrangements. I think we need to find a way of doing that – a much deeper collaboration.” 

It’s not the first time that Ordsall Chord has been touted as a good example of alliance working between the infrastructure owner and its suppliers. When RTM attended the historic placement of the Chord’s network arch back in February, Transport for the North boss David Brown, northern programmes director Chris Montgomery and Skanska’s project director Keith Gardner all sang the praises of the scheme’s tight-knit alliance model. 

Gardner told us that the alliance removes the traditional client/contractor relationship, and reckoned that the companies “wouldn’t be here at this point in time” if it weren’t for this model of working. Brown also argued the Chord was a “really good example of how, when Network Rail is given the support, the time and the money, it really can deliver these pieces of infrastructure”. 

During the Platform debate, which centred around infrastructure, Hoggarth alluded to the need to take into consideration exactly that: the ability to determine the best amount of time and space needed to deliver a scheme. 

“There might be times, for example, where it makes absolute sense to give the contractors more possession time to do the work more quickly, more cheaply,” he said, but explained that TOCs may often reject that because of revenue implications.

“But actually, when you look at it, it might be a lot less revenue lost than the cost of the project being delayed, which might be the alternative. And we [Rail North] can bring that to fruition, break through that money-go-round and actually do the right thing for passengers.” 

Track and train integration 

Curtis argued that while the industry is “in a slightly unusual place” with regards to commitments to closer integration between operators and Network Rail, there are some interesting things coming out of the new franchises in terms of infrastructure delivery. He cited, for example, South Western, which was awarded to First MTR under the agreement to see “closer partnership working between track and train”. 

The South Eastern franchise, whose consultation period finished in late June, and the shortlist was announced just before RTM went to press, also posits the possibility of bringing track and train closer together, “whether it’s planning essential repairs, putting in place improvements that can squeeze in an extra service on a crowded route, or responding to a problem on the network”. 

And the new Wales and Borders franchise is seeking an ‘operator and development partner’ which will be responsible both for running the lines and some key infrastructure enhancements on the Metro network.

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