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Granting wishes

The sSRA has been described as the vital cog missing from the rail industry. Richard Thompson finds out from chief executive Mike Grant how it will make the nation's rail machine work more effectively.

Shadow Strategic Rail Authority chief executive Mike Grant is no stranger to NCE. The one time civil engineer first appeared in the magazine in 1979 during a difficult bridge slide on the Canterbury bypass, though prefers to forget the episode.

'The bridge got stuck, ' he laughs, raising his hands as if to push away the memory. 'It was all over NCE but it was nothing to do with me. I was only an assistant resident engineer.'

His next, more auspicious, appearance was in 1982 when he won the Institution of Civil Engineers gold medal for a paper on the Canon Street river bridge.

Following a couple of years in the City it was his move to Eurotunnel as a financial analyst in early 1987 that was to be his big break. There he met Sir Alastair Morton. The pair have worked together pretty much ever since (see profile box).

Grant sees creation of the Strategic Rail Authority as essential for Britain's railways. Without it, he says, the industry was like a machine with a vital cog missing. 'The SRA is that cog - some will view it as small, others large, but nevertheless it is still important' he says. 'And its job is to develop a framework within which the private sector operates to make a bigger, better and safer railway.'

It is a massive job and Grant recognises where rail's biggest problem lies - its infrastructure. 'I'd give infrastructure a one or a two out of 10, ' he says. 'It's because there has been no investment in railways for the last 10 years. We are in a position now where there is no capacity in the network and that is what we, with Railtrack, need to provide.'

The sSRA will unveil its vision for Britain's railways in the autumn. But Grant says it has been up to the industry to tell the sSRA what it needs.

'We are not a command and control organisation and nor do we intend to be, ' he says.

'We have asked the industry: 'what do you need to make this business better?' One way we have done this has been through two batches of franchise replacement and there have been some very good ideas coming forward. These will form the building blocks for our strategy.'

Key to the sSRA's approach has been not to set out a prescription for what the train operators include in their franchise bids. And Grant points to train operator Virgin's ambitious proposal to build nearly 120km of high speed line to increase capacity on the East Coast Main Line as an example of the sort of imaginative thinking the process has produced. But the element of uncertainty about what is required on each line has led to network manager Railtrack warning of a potential hiatus in work until the franchise process has been decided, however.

'If we are very prescriptive about what we do then we kill the opportunity for ideas to come forward, ' Grant says.

'But we recognise that in the initial stages of these ideas being worked up there, will be a bit of a hiatus. We are looking at the next 10 to 20 years so a few months here and there is probably reasonable at this stage. We would not be doing our job properly if we didn't analyse these projects carefully and come up with what is best for the travelling public.'

The sSRA has the difficult task of assessing the various bids and awarding the franchises. Grant says it has the tools in place that will allow it to judge the bids to ensure Britain's travelling population gets the best outcome.

'There are fairly well defined criteria in terms of economic analysis used for assessing the bids, ' he explains. 'And that is not just the limit of the fare box.

There are only two places the money can come from. One is the fare box and the other is the Government. We want to invest to make sure the fare box portion increases. As a government organisation we also have to take into account socio-economic benefits.'

Grant sees Railtrack as vital to the refranchising process. 'If franchise bids contain infrastructure upgrades, the costs will be based on Railtrack's estimates, ' he says. 'For example, on the Chiltern franchise the two shortlisted companies Govia and M40 are working with Railtrack on costing their ideas.'

However, the sSRA will also audit the proposals. To carry out this work it is recruiting a panel of technical consultants it can turn to on a regular basis.

'I can't emphasise enough the need for joint collaboration between a number of parties. There are huge amounts of money to be spent and huge amounts of work to be done. We have got to get the process right from the start.'

Defining moment

So how does a talented young civil engineer rise to become chief executive of the body responsible for giving Britain the 'best railway in the world'? Shadow Strategic Railway Authority chief executive Mike Grant says it is because he realised fairly early on that a conventional civil engineering career path wasn't for him.

'Although I enjoyed being on site, ' he says, 'I couldn't see myself doing contract management for the next 40 years. Civil engineers are very good at doing the engineering but as long as the money is there they are not very good at managing their own destiny, which wasn't the case for me.'

After leaving school at Childwall in Liverpool and obtaining an HNC in civil engineering, Grant joined the Department of the Environment as a draughtsman. His first job was in the Houses of Parliament underground car park.

He then moved on to British Rail's southern region bridge office where he worked on Canon Street and Charing Cross river bridges. BR paid for him to take a part time degree in civil engineering at North London Polytechnic, which he completed in 1983. He was chartered two years later.

Soon after Grant made his decision to leave civil engineering.

An interest in the stockmarket and how things were funded led him to City University, London, where he took an MBA specialising in finance.

On its completion he joined City firm Laing & Cruikshank as a financial analyst working in the capital markets. But that didn't suit him either. 'The team approach wasn't there. And while I could have made a lot of money, I didn't feel I was producing that much.'

After about 18 months, Grant made the move which was to shape the rest of his career. 'I was offered a job at Eurotunnel as a financial analyst, ' he says. 'My first job was working on the £5bn debt syndication.'

Grant joined Eurotunnel at the same time (though only as a 'mere mortal', he insists), as Sir Alastair Morton arrived as chairman. He rose through the company in various finance positions ending up as director responsible for restructuring the $10bn debt involving 220 banks.

And it was Morton's appointment as sSRA chairman last year that encouraged Grant, who after completing the Advanced Management Program at Harvard Business School was working at Railtrack Property, to apply for the job as director of Passenger Rail Franchising at the Office of Passenger Rail Franchising.

Grant says the lessons from Eurotunnel will be invaluable at the SRA. 'The biggest lesson from Eurotunnel is to make sure the specification is there before you start. Our job here is about drawing up the specification for the nation's railways. It is also about making sure individual projects are defined adequately so there are no surprises later.'

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