PAC: GWML electrification a ‘stark example of how not to run a project’
The management and overspending by Network Rail (NR) on the Great Western electrification programme has been described as “staggering and unacceptable” by the Public Accounts Committee (PAC) after it was found that £330m was wasted on the project.
In a report published today by the influential committee on the GWML route electrification scheme, MPs found that the estimated cost of the works had risen by a whopping £1.2bn in the space of a year, and that it was unclear whether the infrastructure owner would still be able to finish the changes by the revised target of December 2018 and budget of £2.8bn.
The findings comes after the National Audit Office published a similar report last year warning that the project would have to be reassessed. PAC also raised concerns about the ability of the DfT and NR to manage similar projects in the future, such as TransPennine and Midland Main Line electrification, both of which have been subject to delays and ‘pauses’.
MPs also said that there were now serious questions regarding whether full electrification was even an appropriate option for the Great Western route, especially considering the DfT’s announcement that passenger benefits and taxpayer value could be achieved without electrification – a view which is delaying the works and costing taxpayers £330m.
Major concern was raised about the management of the project. PAC told NR that it must improve its ability to “produce realistic cost estimates” after the company had previously admitted that “every single part of the programme is absolutely on the limit”.
The report identified “significant failings” in the design, planning and cost estimation of the project, going on to say that accountability arrangements were overly complex and that there was little assurance for DfT that NR could be an effective client to deliver the changes.
The committee made various recommendations to ensure that the works could be successful going forward, including arguing that the department needed to reassess the case for electrification section by section and only allocate funds where there was clear benefit to customers.
DfT and NR were also urged to bring together trains, infrastructure works and the operation of services when making future plans for the project.
Meg Hiller, chair of the PAC, said that the mismanagement of the programme had “hit taxpayers hard and left many people angry and frustrated”.
“This is a stark example of how not to run a major project, from flawed planning at the earliest stage to weak accountability and what remain serious questions about the reasons for embarking on the work in the first place,” she added.
“The sums of public money wasted are appalling – not least the £330m additional costs the DfT will have to pay to keep the trains running because of delays to electrification.”
Hillier also criticised the government for failing to hold NR to account on electrification, whilst also “casting doubt” on the need for it.
“Network Rail admits there are still very significant risks in the Great Western scheme and it is vital these are fully identified and carefully managed” she argued.
She called on the DfT to urgently review plans for electrification on the Great Western route, as well as similar projects on the Midland Main Line and TransPennine routes.
“Electrification was heralded with the promise of benefits to passengers but the government has a duty to determine if, in fact, these benefits can be delivered in a more timely and cost-effective way,” the chair concluded.
But rail minister Paul Maynard defended the project, saying: “The modernisation of the Great Western Railway is the most substantial programme of work undertaken on the railway since the Victoria era and will deliver better services for passengers, with new trains and thousands more seats.
“We continually assess our investment decisions to ensure they deliver maximum value for the taxpayer. As the report acknowledges, since autumn 2015 we have overhauled the way the department commissions and oversees work from NR – including a clear structure of accountability, with new governance processes that include independent assurance on cost and deliverability.”
A spokesperson from NR agreed that the infrastructure owner and department have learnt the lessons from the “poor early planning of this project”.
“Today we do not take forward major projects until they are properly scoped, properly planned and we have a robust estimate of what the cost will be,” they added.
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