Latest Rail News

20.11.15

Network Rail admits it was ‘overly ambitious’ with CP5 projects

Network Rail has admitted it was “overly ambitious” in what it could achieve with the funds and resources available in CP5. 

Responding to the Public Accounts Committee’s (PAC’s) report into Network Rail’s investment programme, the infrastructure owner stated that its “understanding of how best to plan and deliver major new electrification schemes was not good enough”. 

According to the PAC, the DfT, Network Rail and ORR agreed to an “unrealistic” programme of rail investment for CP5 that contained “too much uncertainty” on the costs of many large projects when it was signed off. 

During the Committee’s inquiry, Mark Carne also revealed that the expected cost for Great Western electrification had increased by up to £1.2bn from the £1.6bn agreed in 2014. This means the cost range is now between £2.5bn and £2.8bn. 

The MPs said it is “not clear” whether the cost escalation is due to Network Rail inefficiency, ORR lacking a full understanding of the work needed, or a combination of both. 

The Committee is now calling for Network Rail it to embed “much tighter” project planning, costing and cost control throughout the organisation. It must also be “clearer” with the DfT about what can and cannot be afforded. 

Following the “unacceptable” cost increase on Great Western electrification, it has been recommended that the DfT and Network Rail publish an updated schedule and cost forecast for the project – along with a full account of what has caused the cost increases to date and proposals for controlling future costs. 

PAC added that there is still “far too much uncertainty” on costs and eventual delivery dates for the other two major rail electrification programmes in the 2014-2019 programme: TransPennine and Midland Main Line, which have now been delayed into CP6. 

Sir Peter Hendy’s review of these and the other rail enhancement planned for CP5, which is to be published towards the end of this year, will bring more bad news on costs, said the MPs. 

A Network Rail spokesperson told RTM: “It is clear that we, as an industry, were overly ambitious about what could be accomplished with the funds and resources available to deliver the high levels of investment which will enable our railway to continue to cater for growing numbers of passengers and support economic growth. 

“Network Rail has successfully delivered over 5,000 projects over the past five years, but our understanding of how best to plan and deliver major new electrification schemes was not good enough. We have now made significant changes to the way we plan and deliver our investment programme, which will see schemes progress only once they are sufficiently developed that a reliable cost estimate can be established. 

“Sir Peter Hendy’s report on the deliverability of the current investment plan will be published later this month.” 

Additionally, for the next planning round of rail investment, and in all future investment planning, the government must assure itself that its plans can be delivered, stated the Committee. It has now called on the DfT and ORR to “assess and explain how uncertainty in key projects could affect the plan’s overall costs and schedule” for all rail spending decisions. 

PAC added that the five-year rail investment planning and funding model, which is appropriate for ongoing operations, maintenance and renewals, is “not adequate” for major enhancement work such as the current electrification schemes. 

In respect of this, the MPs want the ORR and DfT to put in place “sharper accountability arrangements” for major enhancement projects, such as the Great Western Main Line electrification, and agree principles on when it is appropriate to fund and manage these projects outside the five year rail funding cycle. 

A DfT spokesperson said: “We are proud to have a hugely ambitious investment programme, but agree that lessons should be learned on all sides. 

“We are committed to seeing the £38bn programme through and delivering the railway passengers deserve. That’s why the secretary of state asked Dame Colette Bowe to look at the lessons learned and make recommendations on what can be done better in future, and why Sir Peter Hendy is developing proposals to get the rail upgrade programme back on track and ensure it is both affordable and deliverable. Both reports will be published later in the autumn. We will respond to the PAC in due course.”

Comments

Huguenot   20/11/2015 at 17:10

On GW electrification, even when Network Rail did think it could achieve it to the original timescale, why didn't it concentrate on one route first, e.g. London to Bristol TM via Bristol Parkway, instead of pressing ahead on several fronts including the Chippenham route and the Berks & Hants? At least then it might have achieved something for the IEP to run on. Instead, the taxpayer is going to be paying for the Class 800s to be languishing in sidings whilst the wires go up.

Andy Ellis   23/11/2015 at 08:28

Network Rail, and the Government's “understanding of how best to plan and deliver major new electrification schemes was not good enough” surprise, surprise! That's because they haven't done any on anywhere near the scale of Midland Main Line, never mind GWML, for 30 years. When East Coast Main Line electrification was finished in the 1980's the Engineers said give us a rolling programme and let us carry on! Privatisation, through separation of trains and track destroyed any coherent business plan for electrification as all the cost sits with Network Rail and all the benefit sits with the train operating companies which is why it has taken so long to get electrification going again. Then to try to do it all at once was a nonsense. A railway is a long term high investment business and its funding cannot be run to short term political time scales. This was why British Rail could never deliver it's five and ten year plans, government kept hold of the purse strings and only released funds on a yearly basis, we cannot afford to go back to those days either! Similarly HS2 has been totally miss sold by the politicians, it is not about journey times, it is the natural expansion and growth of the UK rail network to modern standards. The message that should have been communicated is how many miles of major trunk roads and motorways have been built in the last 50 years and how many miles of mainline railway have been built over the same period? I would rather have a railway at the bottom of my garden than a motorway.

Add your comment

 

related

rail technology magazine tv

more videos >

latest rail news

Network Rail’s subsidiary secures systems integrator contract in Australia

14/12/2018Network Rail’s subsidiary secures systems integrator contract in Australia

The Australian subsidiary of Network Rail Consulting has been named as the systems integrator for the Digital Systems Program in Sydney by Transp... more >
Infrastructure giant Amey to be sold to private equity firm in new year

14/12/2018Infrastructure giant Amey to be sold to private equity firm in new year

 Infrastructure giant Amey is expected to be sold to a private equity firm in the new year, according to reports. The Financial Times b... more >
HS2 and Crossrail suppliers admit to running ‘illegal cartel’ for 7 years

14/12/2018HS2 and Crossrail suppliers admit to running ‘illegal cartel’ for 7 years

Two UK rail suppliers to major projects such as HS1, HS2, and Crossrail have admitted to operating an illegal cartel for almost seven years with ... more >

editor's comment

23/01/2018Out with the old...

Despite a few disappointing policy announcements, especially for the electrification aficionados amongst us, 2017 was, like Darren Caplan writes on page 20, a year generally marked by positive news for the rail industry. We polished off the iconic Ordsall Chord (p32), hit some solid milestones on Thameslink (p40), progressed on ambitious rolling stock orders (p16), and finally started moving forward on HS2 (p14) ‒ paving the way for a New Ye... read more >

rail industry focus

View all News

interviews

HS2 train race: making the case

20/11/2018HS2 train race: making the case

Bombardier and Hitachi’s commitment to providing the best HS2 rolling stock pitch to the government was signified with the launch of their ... more >
Finding positives in negative short-circuiting devices

09/11/2018Finding positives in negative short-circuiting devices

Sponsored interview  Anything that brings about safety and time-saving benefits is a valued improvement for the rail industry, which is w... more >
Taking to the skies

30/10/2018Taking to the skies

Network Rail’s commitment to driving innovation is best encapsulated by its latest scheme involving high-definition imagery drones, or UAVs... more >

last word

Encouraging youngsters to be safe on the railway

Encouraging youngsters to be safe on the railway

This summer, Arriva Group's CrossCountry and the Scout Association joined to launch a new partnership to promote rail safety among young people. ... more > more last word articles >

'the sleepers' daily blog

Spotlight on Coventry Very Light Rail

27/11/2018Spotlight on Coventry Very Light Rail

Olivia Brown, business development officer at Warwick Manufacturing Group (WMG), an academic department of the University of Warwick, outlines th... more >
read more blog posts from 'the sleeper' >

comment

Passenger safety: Respect the edge

27/11/2018Passenger safety: Respect the edge

Claire Coward, communications lead at the RSSB, discusses her organisation’s latest passenger safety campaign. Incidents at the platfo... more >
Night Tube: The twilight economy

27/11/2018Night Tube: The twilight economy

Dr David Lutton, executive director of economy and tax at London First, argues that the capital’s night-time economy is just starting its j... more >
Monitoring the performance of earthworks

27/11/2018Monitoring the performance of earthworks

Dr Joel Smethurst, associate professor in geotechnical engineering, and Professor William Powrie, professor of geotechnical engineering, both of ... more >
Introducing iPort

20/11/2018Introducing iPort

Steve Freeman, managing director of iPort Rail, introduces the UK’s newest inland freight terminal. The UK’s newest inland rail ... more >