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06.12.18

DfT ‘won’t deal with rail industry’ unless it speaks with one voice, industrial strategy minister says

The government’s Rail Sector Deal will focus on achieving transformational deals with a joined-up rail industry away from London, the minister for the Industrial Strategy has told RTM.

Visiting companies Resonate and Ricardo Rail in Derby this week, Richard Harrington said the Rail Sector Deal, launched today, signals a new partnership between sector providers and the government, and outlined what the government is looking for in future deals with the rail industry.

Harrington, who had revealed that the Rail Sector Deal was “close to fruition” last week at the Railway Industry Association parliamentary reception, said the government “will not deal” with the rail industry unless it continues to organise itself as a collective body, and that the locations of the deals are a key factor in future dealings.

The Rail Sector Deal will officially launch this afternoon during a reception at the Institution of Civil Engineers. While the DfT has not revealed further details yet, it promised that the deal will set out a plan to boost efficiency, improve journeys, and increase the sector’s capability to trade internationally.

Highlighting the key demands the government is looking for in future dealings, Harrington told RTM: “First of all is place: we have to focus on transforming the places where people live and work by backing businesses and building infrastructure, not just in London and the south east but across every part of the country. Take Derby, for example: the region has expertise in highly skilled areas such as IT and digital rail.”

He also spoke of the need for the industry to collaborate with the government using a joined-up voice so its message is clear. “We will not deal with an industry unless an industry organises itself in a body, because otherwise we’re spending all of our time with this company, that company… They’re all competing with each other, it’s very difficult for us to know,” the minister explained.

“It has to be proper organisation with industry, and usually they’ve got their act together to do that—rail is a very good example of it. And when you speak to people in the industry, there’s companies in it that compete with each other, but they realise that the development is for the common good.”

Harrington added that the government will be more preferential towards more long-term, revolutionary-type deals that will propel the industry forward.

“We’re looking for deals that are transformational,” he said. “We’re not interested in little nuances. In rail, for example, digital technology will transform the industry, and we hope it will make the UK become the market leader in the world, just as in a different generation it was for manufacturing.”

The industrial strategy minister went on to say the deal has been a culmination of marrying up the government’s demands with what the rail sector can deliver.

“This is the industry saying, ‘This is what we’re prepared to do,’ but government has to say, ‘This is what we’re prepared to do.’ So whilst it’s not in the form of a legal contract quite in the same way as you would expect, it’s all subject to value for money,” he noted.

“So, projects that will be announced still have to go through the hoops, making sure that from the taxpayers’ view it is value for money. Some people find this very slow and bureaucratic—which we have to be, because we’re dealing with many millions of pounds worth of taxpayers’ money—but I think it’s exciting.”

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