Network Rail’s new chief executive Andrew Haines offers New Civil Engineer a refreshing candour and no-nonsense attitude.
Haines has been straight-talking since taking the helm at the rail infrastructure operator last Autumn, frequently referencing the seven sustained years of decline in train performance that his predecessors have overseen.
It is an uncomfortable truth that figures published by regulator the Office of Road and Rail show the proportion of trains in Britain which failed to arrive at their destination on schedule has fallen from 92% in 2011/12 to 88% in 2017/18.
“Despite huge investment in rail, greater than any previous generations can have imagined, we’ve been delivering declining performance. And not only that, we’ve been failing every year, year-on-year, to deliver the performance we promised to deliver,” Haines told the Commons transport select committee within weeks of his appointment. “Seven years of declining performance and seven years of failing to deliver that year’s plan. I’m not sure which is worse, the fact that we can’t even predict what we’re going to do or stick to our promise, or the fact that we’ve actually presided over that long-term plan.”
Or, as put to New Civil Engineer this month, “we have a 100% success rate on failing on planning and there is a complete lack of confidence in our cost control”. It is a damning verdict for which he says there are mitigating factors – notably the severe strain the network is under due to ever-increasing passenger demand. But he is “appalled” by the degree of micro-management he faces from ministers – the unintended consequence, he says, of three key political decisions: the abolition of the arms-length Strategic Rail Authority, the change in franchising that took place following the West Coast franchising issue, and the reclassification of Network Rail as a public body as a consequence of the work of the Office of National Statistics. All of these have led to ministers becoming very hands-on at a very granular level.
That said, the industry has done little to encourage those ministers to back off a little, with the high-profile Great Western electrification saga still an open wound. But there is more to seven years of declining performance than just that one failure, and Haines, having returned to the industry after 10 years in the aviation sector, says he was dismayed at how little the industry had evolved – still working to the same policies and processes, with the same low service culture.
“We are seen as bureaucratic, slow, difficult and arrogant, and have too many people too many steps away from the real-time running of the railway,” he says.
Having taken stock, he has now ordered a major structural reorganisation to make Network Rail more customer-focused. Eight existing geographical rail networks – know as routes – will be increased to 13 to better align them with franchises. Five regions will support the 13 new routes with the previously centralised Infrastructure Projects (IP) division split up and devolved to them. IP managing director Francis Paonessa’s departure has already been announced internally. Managing directors (MDs) to run the five regions will be announced in May and they will become key figures for civils contractors, particularly as track alliances currently being procured are being aligned to these regions. These regional MDs will sit on Haines’ executive board so there will be consistency in areas such as standards and procurement through that, but fundamentally they will run their railway their way.
This could mean different regions taking very different approaches. “If it is standards driving up costs then the regional director will have influence over the standards in that region that they don’t currently,” says Haines. The digital railway initiative is perhaps the highest profile casualty of the shake-up. Haines is harsh in his assessment of the return on investment returned from that “crazily” big division and the MD David Waboso has retired. Future digital signalling programmes will roll into signalling upgrades; a part of the network services division that will remain largely centralised due to the economies of scale that Network Rail gets from keeping it national. But Haines wants other elements of the digital railway programme – such as traffic management software that improves train scheduling – deployed regionally where appropriate.
Haines’ restructuring is, of course, another in a long line of restructurings and he has made himself open to accusations that he is just shifting the deckchairs. He stoutly rejects such allegations, suggesting that to accuse him of that is to misunderstand how badly broken his organisation is, how radical his changes are, and the impact he expects them to have.
“What I am doing is fundamental. Seven years of consecutive failure on performance and not convincing the Treasury on investment is a burning platform.”
And how long will it take to see results? Well, on that one it is over to the industry. “I don’t know how long this will take as it will depend on the industry and its willingness to come with me on this journey.”
And what of the ongoing independent rail review led by former British Airways boss Keith Williams? With its predominant focus on franchising, is there not a danger Haynes is restructuring around a model that may soon life-expire? “We can’t wait for Williams,” he says, explaining that it would likely be four years before any primary legislation is in place to radically alter the shape of the industry. “We just can’t wait for someone to tell us how to do our jobs better.”
Last time Andrew Haines was in conversation with New Civil Engineer was in May 2016, when he was offering sound cautionary words about the £22bn expansion of Heathrow in the South East in his then role as Civil Aviation Authority chief executive. Then, he was warning the big challenge was regulating an investment of that size while keeping the customer firmly in mind. Network Rail’s Haines has just agreed to a £35bn funding package and the spending plan for control period 6 (CP6), which will run for the next five years to 2024. It is a similarly big sum of money and it is clear that Haines again has his eyes firmly on the customer – and industry has to jump on board.