Comment

Network Rail’s delivery challenge is critical for the whole UK infrastructure pipeline

Antony Oliver, Infrastructure Intelligence editor

With the new government setting out its claim to lead a “parliament of delivery”, any loss of confidence now could be catastrophic for the industry and the economy, says Antony Oliver.

In her recent interview with Infrastructure Intelligence, rail minister Claire Perry correctly points out that Network Rail faces its greatest ever challenge as it battles to transform the rail network and meet the ballooning demand for passenger and freight services.

As the numbers demonstrate, it is a success story without which the nation’s transport system would have long since ground to a halt. But as the numbers also clearly show, the system is struggling to cope.

"When Mark Carne took over as chief executive of Network Rail at the start of 2014, Infrastructure Intelligence offered some advice for his first 100 days. Number 2 on the list of 10 was to “Carry out a personal review the priorities of the next CP5 spending period and satisfy yourself that they are the right ones.”"

When we spoke last week, Perry was keeping her powder dry over precisely how the government intended to respond to the clear on-going underperformance by Network Rail – underperformance graphically pointed out in the latest quarterly Office of Rail and Road monitor report. 

Yet it was clear that her answer would not be to do nothing.

Thus a week later her boss Secretary of State for Transport Patrick McLaughlin has indeed lifted the lid on Network Rail’s delivery problems and ordered a review of large parts of the on-going £38bn programme. 

It will have come as little surprise to those in the industry. A year into this CP5 control period industry seems to agree and now appears comfortable talking about the elephant in the room of missed milestones, over spent budgets and under-delivery - as highlighted by discussion at the recent Railway Engineers Forum Technical Seminar. 

And while the political talk now centres on how much ministers knew about Network Rail’s problems before the election, in reality it has been clear for some time that the CP5 programme was always pretty ambitious.

In fact when Mark Carne took over as chief executive of Network Rail at the start of 2014, Infrastructure Intelligence offered some advice for his first 100 days. Number 2 on the list of 10 was to “Carry out a personal review the priorities of the next CP5 spending period and satisfy yourself that they are the right ones.”

We added: “If Carne is not satisfied, our rail experts say he has a window of opportunity as the new man in charge, to go to the Office of the Rail Regulator and seek a review.”

He didn’t and so now 18 months later McLaughlin has. 

"Infrastructure has positioned itself well as the solution to the nation’s economic woe, and proved that it is worth investing precious and well-guarded public cash."

No one comes out of this looking good. And for the industry the real post-Election fear and the reason for talking appears to be that without fundamental change and transparency the industry risks a severe loss of confidence.

Such a loss would be catastrophic across infrastructure, a sector which has spent so long building up the confidence of government and investors through projects such as the Olympics and more recently Crossrail that it can be relied upon to deliver.

As Perry points out in her interview, infrastructure has positioned itself well as the solution to the nation’s economic woes and proved that it is worth investing precious and well-guarded public cash.

This must continue. Green light for the Swansea Tidal Lagoon project signals the start of a potential £30bn world leading industry. The transformational impact of long term investment in UK highways and a move towards world leading digital asset management techniques really do offer the opportunity for the UK industry springboard off its success.

But only if we are organised to get the basics right and move on from late and over budget programmes. 

This “will be a parliament of delivery”, says Perry. It would be a good idea to embrace that ideal.