19.05.16
ORR opens consultation into route-based regulation
Railway regulation could change in CP6 so that Network Rail regulates each individual route, as part of proposals in a new Office of Rail and Road (ORR) consultation.
Under the proposals, which featured in the ORR’s 2016-17 business plan last month and are now being include in the PR18 consultation, each route would be required to submit a separate business plan to the ORR, and would receive its own outputs and funding.
The ORR said the proposals would allow more reliable comparisons between route businesses and provide better motivations for companies to improve their performance by tying it more clearly to their reputation.
Routes would also be encouraged to involve train operators and local stakeholders more in developing business plans.
In a blog post to introduce the consultation, John Larkinson, the ORR’s director of railway markets and economics, said: “Our aim for the review is to support a more efficient, safer and better performing railway, delivering value for passengers, freight customers and taxpayers into the next decade and beyond.
“The rail industry has changed considerably since our last periodic review in 2013, and our approach is changing to reflect this.”
At this year’s Infrarail Nick Elliott, managing director of the Network Rail’s National Supply Chain, said that route-based devolution would make it easier to expand the role of SMEs in the supply chain.
The consultation also contains proposals for closer scrutiny of Network Rail itself by the ORR, including set performance measures for its ‘system operator’ functions, in order to ensure that greater devolution of the railways takes place in an organised fashion.
Funding uncertainties could expand into CP6, ORR admits
The consultation also admits that more consideration is needed into funding for rail upgrades, especially in light of the proposals for route-based regulation.
The programme of changes in CP5 has suffered delays due to financial problems, which the report has said are linked to a number of factors, including increased devolution and the borrowing limits set on Network Rail after it transferred to public ownership.
The ORR cited Digital Railway as a potential casualty of the uncertainty about funding, saying: “It may well be the case that sufficient clarity will not exist about the timing and funding of the ‘Digital Railway’ programme for it to be included in our determination for CP6.”
Last week the ORR warned the Transport Select Committee that the upgrades required to implement Digital Railway will be a ‘major issue’ throughout CP6.
The ORR is seeking submissions from stakeholders including passengers, companies, Network Rail, watchdogs and the government. The consultation is open until 10 August. To take part, click here.
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