Latest Rail News

11.03.16

McLoughlin endorses Network Rail asset sales

Selling assets is an option that Network Rail ‘should consider’, transport secretary Patrick McLoughlin told MPs yesterday.

Network Rail has hired banking firm Citigroup to look at options for plugging its £2.5bn funding black hole, with the sale of 18 major stations including London Waterloo, Manchester Piccadilly and Birmingham New Street on the table.

In response to a question by Susan Elan Jones, Labour MP for Clwyd South, McLoughlin expressed support for filling the debt with asset sales.

He said: “If Network Rail is sitting on certain assets, should it consider disposing of some of them so that we can carry on improving the overall system? Yes, it should. I do not see anything wrong with that.”

Rail minister Claire Perry MP last week confirmed that Citigroup will report back on the options by the end of the year. However, anti-privatisation group ‘We Own It’ launched a campaign against the sale of the stations, and a poll of RTM readers also found that 47% opposed the move.

Network Rail also confirmed it is considering selling off electrical power assets.

In the Commons yesterday, McLoughlin refused to commit to opposing the privatisation of Network Rail following a question from Labour MP Dr Alan Whitehead.

When asked by Conservative MP David Nuttall if he agreed that privatisation in other sectors had improved efficiency, he replied: “I do agree, but there is obviously responsibility for a system of railway maintenance and improvement, which is very important. I will consider any other ways in which we can involve the private sector in providing better railway services for our constituents.”

The final version of the Shaw report into the future of Network Rail is due to be published next week, and transport minister Lord Ahmad of Wimbledon has said that the department will not rule out any options that could be recommended.

Comments

Ivor   11/03/2016 at 12:29

Yet more privatisation that last time did so well for reducing costs to the tax payer.

The North!   11/03/2016 at 13:01

Why is it that very clever people, who are paid a lot of money can come up with extremely silly & short term views! If this was a house that I owned, but I needed money to extend it - would I sell the house, lease it back & then use the money to extend the house (that someone else now owns)?!?! NO Come on guys - use some common sense. If funding is needed so desperately, raise a mortgage on the stations & repay it over 25 years. At least the nation will still own these crucial hubs.

Jack   11/03/2016 at 13:37

The government don't get the idea they bought NR and refusing to foot the bill lazy bastards

Jak Jaye   11/03/2016 at 14:51

This man is the worst Transport Minister ...ever and we've had a few! the splitting up of BR has been and still is a gigantic gravy train for the likes of Vermin,First Group,Abbelio and GoviaRail total disaster

Steve   11/03/2016 at 15:12

Didn't Railtrack try this, selling off land/property, keeping its shareholders happy. The bubble burst then, and it'll burst again. There is always money to be made in the short term by selling off current 'live' assets, the companies buying them will want to make money from them - lease costs to NR, retail income etc. What happens when NR has another black hole to fill in the next control period? Not only has it denied itself the income stations generate, it has nothing else to offer. Don't do it...

Thesecretrailwayman   11/03/2016 at 16:19

Completely agree with the sentiments from The North! here. This is a position LuL were in 10 years ago and quite rightly decided not to sell the family jewels but invest in them more and make them worth more. Complete short-term view to plug a gap in the funding stream rather than work out what the long-term strategy for Rail should be and work towards that. I would say private investment is welcome however, just don't sell off assets which provide opportunity for value or are critical assets for managing safety, risk and performance like stations and electrical systems!

Kev Smith   11/03/2016 at 18:57

a bad move selling assets of the assets of the railway permenant way - since the infrastructure was sold off as railtrack, been renationalised, renamed as network rail, maintenance sold off, assets smashed(millions of quid of equipment that was good smashed and scrapped) due to IMCs not wanting to share anything the whole sorry saga of the infrastructure company has been written in sleaze, money wastage and near anal accountancy foulups. no longer is a sleeper is sleeper, an overhear wire gantry just a gantry - they are anally costed managed assets, the flogging off of any infrastructure that is key to day to day operating of a railway is a bad bad bad idea, as always the tories only see two days ahead of the issue and see a fast buck...how long before ballast isnt counted in tonnes but in actual pieces of stone when thats sold off, this is not a good idea...and one that should be destroyed in fire immediatley, and the person who even contemplated it sacked and sent to work in tescos for the rest of his/her natural life as a trolley dolly as a sentence

Brian   12/03/2016 at 08:20

Excuse me; Tesco's trolley dollies have a better idea of running a transport system than Patrick McLoughlin

Simon   14/03/2016 at 11:10

Presume this is a preview of what the final Shaw Report will say, still this is all very short sighted to be honest and what goes around comes around and this will undoubtedly come back to haunt the Government and DFT..

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