£2bn electrification schemes “unpaused” but bulk of work now in CP6

Work to electrify TransPennine and Midland Mainline railways will resume under plans announced today, as part of Sir Peter Hendy’s work to reset Network Rail’s upgrade programme.

Sir Peter Hendy - electrification schemes “unpaused"

Transport Secretary Patrick McLoughlin paused the schemes in June, brought Hendy in as Network Rail chairman and asked him to review the whole CP5 programme after concerns about cost and deliverability. Following advice from Hendy he has now agreed that revised options for the two schemes priced at around £2bn and crucial for development of the Chancellor’s Northern Powerhouse can restart.

Hendy’s brief for the CP5 review includes requirements to make sure that the cost for delivery of Network Rail work within 2014 to 2019 does not exceed the original funding assumptions for enhancements; and work that cannot be afforded, or is not deliverable, between 2014 and 2019 is profiled for delivery beyond 2019, pending availability of funding.

"I understand the Government acknowledge that unpausing now will create a further significant spending pressure. My re-plan will set out what Network Rail can do within its own resources to mitigate the impact to the rest of the affordable programme" - Sir Peter Hendy

For TransPennine between Stalybridge and Leeds and on to York and Selby, Hendy has said that planning for a better scheme delivering more benefits than the original – which only changed the power supply of the trains - should get underway immediately. This would involve Network Rail, Department for Transport and Transport for the North working together on the plan with detailed design to conclude by the end of 2017. Electrification will start in 2018, with some enabling works before then, with a completion date of the end of 2022, Hendy said.

On Midland MainLine, Hendy is proposing that line speed and capacity improvement works already in hand are added to so that the line north from Bedford to Kettering and Corby is electrified by 2019. “The line north of Kettering to Derby/Nottingham and Sheffield can be electrified in stages by 2023,” Hendy said.

In his letter to Secretary of State for Transport Patrick McLoughlin requesting that electrification work on the lines restart Hendy explained the impact on the costs and his work to keep the £38bn CP5 spending programme in budget.

“You commissioned my review as a result of both cost pressure and time delays, and I am continuing work to set out the extent of the already evident funding shortfall in CP5. I understand the Government acknowledge that unpausing now will create a further significant spending pressure,” he wrote.

“My re-plan will set out what Network Rail can do within its own resources to mitigate the impact to the rest of the affordable programme.

“Of course a considerable amount of the electrifiction costs of both schemes will fall outside CP5 and this will form part of the core of CP6 schemes which by then will be underway."

The new Transpennine plan will deliver faster journey times and significantly more capacity between Manchester, Leeds and York, DfT said. The upgrade is expected to provide capacity for six fast or semi-fast trains per hour, take up to 15 minutes off today’s journey time between Manchester and York and be complete by 2022. When the work is finished, the whole route from Liverpool to Newcastle (via Manchester, Leeds and York) will be fully electrified and journey times will be significantly reduced compared to today’s railway.

“The temporary pause in the programme has given us the space to develop a better plan for passengers,” Hendy said. "People can expect more services and faster journeys.

“We face some difficult challenges, and there is more work still to do, but the Secretary of State’s decision means we can now move forward with our plans to electrify TransPennine and Midland Mainline."

Hendy’s full review of CP5 is due in the Autumn along with a report from  economist and regulatory expert Dame Colette Bowe will be published on lessons learned, which will also make recommendations for better investment planning in the future. 

Industry welcomed the news of the restart but hoped that the action of "pausing" was a one off.  

“It is excellent to hear that the electrification of these two vital lines is now back on, following the pause," said ACE chief executive Nelson Ogunshakin.  "ACE’s view is that only a rapid reinstatement will ensure industry confidence is not fatally undermined. These two routes form part of the government’s Northern Powerhouse strategy and will deliver billions of investment, thousands of jobs, and better access to jobs and markets, through increased capacity and connectivity."

“We would now urge the government and Network Rail to ensure that they learn the lessons from this episode and in their desire to announce projects do not overlook the very great need to develop proper plans and cost estimates. This can best be achieved through Network Rail working more closely with industry before making any firm decisions. We must avoid these kinds of delays if future projects are to be delivered on time, on budget, and on course to maximise the economic benefits we expect from them.” 

Simon Allport, Senior Partner at EY in the North West, said: “This is welcome news for commuters, businesses and the Northern economy, and helps to return some momentum to the infrastructure plans behind the Northern Powerhouse vision.

“It’s important that these revised plans – which go beyond just changing trains’ power supply – are integrated with the wider strategy for Northern transport to ensure our future network is as efficient as it can be to deliver for our economy. It’s encouraging that the latest plans give additional passenger benefits around capacity and journey times.

“The next important steps for the Government will be delivering on its other infrastructure ambitions for the North, which will require significant funding and public support. It will be interesting to see how these progress, given the likely need for new funding sources and for cities with newly devolved powers to work together to deliver integrated transport initiatives.”

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