Latest Rail News

04.05.12

Incentive framework published for Network Rail

The ORR has set out Network Rail’s financial and incentive framework for 2014-19, including plans to vary track access charges in different regions.

The document focuses on encouraging collaborative ways of working, in an attempt to align operators’ incentives with those of Network Rail. This was a key concern of last year’s McNulty report.

As well as the new and revised track access charges, the framework includes efficiency benefit sharing schemes, greater transparency and a regional focus.

Rail minister Theresa Villiers touched on the changes in her speech to the Infrarail 2012 event at the NEC earlier this week, saying: “The Office of Rail Regulation is revising the way track access charges work to give train operators a financial incentive to reduce Network Rail costs.”

Evidence suggests that greater ‘on-rail’ competition for passengers also promotes good value for money, so the ORR will be exploring flexible ways to introduce this.

ORR chief executive Richard Price said: “Britain’s railways have seen real progress in recent years – improved punctuality, good levels of safety, and upgraded rail lines and stations. While efficiency has also improved, much more needs to be done to improve value for money to retain the confidence of rail funders so that continued high levels of investment by taxpayers can be justified.

“ORR’s review of Network Rail’s financial and incentive framework for 2014-19 will help drive greater efficiencies throughout the railways through the creation of better aligned industry incentives, and the drive for greater transparency. Only by working closely and openly together, towards joint goals, will Britain’s railways deliver value for passengers and taxpayers.”

To read ORR’s publication on Network Rail’s financial and incentive framework for between 2014-19, visit: http://www.rail-reg.gov.uk/upload/pdf/financial-incentive-framework-cp5.pdf

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