Latest Rail News

03.03.16

Business funding needed for Crossrail 2 to succeed, says Hendy

Funding will be needed from business as well as the government if railway projects such as Crossrail 2 are to succeed, the chair of Network Rail has said.

Sir Peter Hendy told the London Assembly Transport Committee recently that there was an urgent need for railway capacity to increase and that London businesses could fund as much as 50% of Crossrail 2.

He said he supported the position of Lord Adonis, chair of the National Infrastructure Commission, who also appeared before the committee and said there should be a partnership to fund Crossrail 2, following the success of the supplementary business rate as part of Crossrail.

Sir Peter, formerly the commissioner of Transport for London, said: “It is really important businesses believe in it, they are willing to pay for some of it and we should get on with it.”

He added that similar business investment will be needed in other projects as Network Rail faces unprecedented financial challenges in CP6.

Sir Peter predicated that CP6 will set challenges to the capacity of the railways to absorb new work and to funding after Network Rail returned to public ownership.

He said: “One of the real reasons why CP5 had to be reviewed was that the whole basis of funding the railway changed the day that Network Rail came back into public ownership. It exchanged the virtually unlimited access to cheap government-backed borrowing off the government’s books with a fixed Treasury limit.

“That was a really severe change not just for Network Rail but for the whole of the industry. I do not think you could make any predictions about permanent ‘latening’ of work in CP6. The big challenge in CP6 will be to get it all funded, frankly. In CP6 we are going to have to see more third party contributions to some of these costs than anybody has seen so far.”

Network Rail’s debt is estimated to reach £50bn by the end of the decade. It has hired banking firm Citigroup to look at different options for solving its financial problems, including the option to sell 18 major stations. Citigroup are due to report back by the end of this year.

Sir Peter has already released an Enhancements Delivery Plan Update with £460m cuts in CP5 to projects including the National Stations Improvement, Access for All and the East Coast Connectivity Fund.

Lord Adonis told the committee: “When it comes to major projects on the scale of Crossrail 2, there needs to be a bespoke funding package.”

However, he also said that Crossrail 2 needed to run alongside other projects which were equally important, such as the Transport for London takeover of suburban railway services.

The peer’s comments echo his remarks at last year’s TransCityRail North event, where he called for wider sources of funding for projects such as Crossrail 2 and HS3.

When asked by the committee about the future of railway connectivity to airports, which a recent Transport Committee report says must improve, both men said there were no immediate plans for it.

Sir Peter said there were no plans to introduce four-tracking to Stansted in CP5 and Lord Adonis said he had not been asked to advise on commercial negotiations about connections to Heathrow.

 (Image c. Stefan Rousseau)

 

Comments

S   04/03/2016 at 08:51

RTM - I do not think football has got anything to do with this article or is even relevant for this website??

RTM   04/03/2016 at 08:53

We're just in the process of taking it down.

Den   04/03/2016 at 13:02

More money for London while the North is left with excuses why we cannot have new East/West lines/electric trains and grudgingly are told we can have replacement for pacers in a few years time. Transport money should be the same per head of population.

David   04/03/2016 at 22:39

Den, the CAF order includes new electric trains as well as Pacer replacement. And then there's a proper TransPennine intercity line in development. Funding for Crossrail 2 will follow on from the existing business levy which is generated in the city.

Mccain Steven   15/08/2016 at 19:05

Good morning: I am Mr. McCain, We offer loans to the person (s), businesses and organizations to collaborate in 3% per interest. Have you tried to get bank loans, but without success? Do you need money urgently to get out of debt? Do you need funding to expand or establish your own business? If Interested should contact us by e-mail crowdfunding08@gmail.com for more information.

LBS FINANCE   24/09/2016 at 16:58

Do you need financial aid or assistant in starting a business? We all need financial help now and then. The good news is, you don’t have to get stuck. short term and long term personal loan. We also offer at an affordable rate and all interested individual should Contact us now via E-mail: To reach LBS Financial by mail: lbs.loan@financier.com

Easy Quick Loan Offer   30/09/2016 at 12:07

Are you in need of a loan? Do you want to pay off your bills? Do you want to be financially stable? All you have to do is to contact us for more information on how to get started and get the loan you desire. This offer is open to all that will be able to repay back in due time. Note-that repayment time frame is negotiable and at interest rate of 3% just email us Abdallah.afandi@financier.com

Add your comment

 

related

Rail industry Focus

  • 15/11/2019A workforce which reflects society

    Loraine Martins MBE, Director of Diversity and Inclusion at Network Rail, joins us in the studio for the third episode of our RTM podcast, talking at length about her role and how it came about...
  • 02/11/2019Monica Barbosa: Women In Rail

    Director of business development and communications at Xrail, Monica Barbosa, thinks women are missing out on exciting opportunities because the lack of gender diversity in the rail industry.
View all News

Comment

The challenge of completing Crossrail

05/07/2019The challenge of completing Crossrail

With a new plan now in place to deliver Crossrail, Hedley Ayres, National Audit Office manager, major projects and programmes, takes a look at ho... more >
Preparing the industry to deliver trains for the future

04/07/2019Preparing the industry to deliver trains for the future

The move to decarbonise the rail network involves shifting to cleaner modes of traction by 2050. David Clarke, technical director at the Railway ... more >

Most Read

'the sleepers' blog

Maximising efficiency requires investment in data, but it’s rewards for rail could be extensive

14/11/2019Maximising efficiency requires investment in data, but it’s rewards for rail could be extensive

Rail Technology Magazine’s Matt Roberts explains the significant role data can play within the future development of the rail industry. Standing as a cornerstone of the UK transport network, the rail industry is forever striving to in... more >
read more blog posts from 'the sleeper' >

Interviews

Andrew Haines, CE of Network Rail, tells BBC News his organisation could issue future rail franchises

24/06/2019Andrew Haines, CE of Network Rail, tells BBC News his organisation could issue future rail franchises

Andrew Haines, the Chief Executive of Network Rail, has told the Today programme on Radio 4's BBC’s flagship news programme that he would not rule out his organisation issuing future r... more >
Malcolm Holmes, executive director of West Midlands Rail Executive, announced as TCR Midlands speaker in Birmingham

24/06/2019Malcolm Holmes, executive director of West Midlands Rail Executive, announced as TCR Midlands speaker in Birmingham

Ahead of his appearance, Malcolm Holmes spoke with Rail Technology Magazine about what key leaders in the industry were doing to improve rail in the Midlands. He said: “It’s very... more >