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Network Rail has just £100M left until coffers are filled in 2019

Rail infrastructure work

Network Rail has just £100M left to cover any surprise costs which may arise between now and April 2019.

The Office for Rail and Road (ORR) has warned that the small amount of remaining funds for Control Period 5 (CP5) could lead to  Network Rail delaying more renewals work until CP6 begins.

In its annual assessment, the ORR said Network Rail’s budget “remains tight” for the final year of CP5 (2014 to 2019), with just £100M  to cover unforeseen costs in 2018 to 2019. As a result the ORR has said that it is more likely that Network Rail will have to defer renewals work to CP6 (2019 to 2024).

Last year the ORR forecast that £3.9bn of renewals work would be pushed back into CP6 at the end of CP5, risking the sustainability of the rail network and raising costs.

The watchdog also said Network Rail’s routes needed to do more to prepare for CP6, including booking network access for planned work. It added Network Rail’s start to CP5 had been “sluggish” leading the ORR to step up scrutiny ahead of the start of CP6 next April.

ORR chief executive Joanna Whittington said: “Network Rail’s route plans for the next five years are an opportunity for a step change in efficient delivery, but that can only happen if all the routes are prepared to hit the ground running from day one. At the moment it is clear more needs to be done to ensure this is the case.”

CP5 has been plagued by cost increases and project delays or cancellations, as in the case of key electrification programmes. Network Rail is expected to finish CP5 with around £50bn of debt.

Last year transport secretary Chris Grayling announced Network Rail would have roughly £48bn to spend in the next period. Network Rail said it had spent a record £4.1bn on enhancing the country’s rail network last year, and said its infrastructure delivery had also  progressed strongly.

A Network Rail spokesperson said: “Network Rail welcomes the regulator’s findings that we continued to deliver good health and safety management in 2017/18; that the reliability of the network has improved in England and Wales; and that the delivery of enhancement projects in Scotland has improved significantly.

“However, we acknowledge that punctuality remains an area for concern, particularly after passengers experienced poor performance following the introduction of the May timetable. We are committed to working with industry stakeholders to improve services for passengers.”

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Readers' comments (1)

  • Philip Alexander

    For Network Rail this is just a minor inconvenience of being so incompetent that they run out of money, but they all keep their jobs so that's alright then. We'll, actually no, because their famed supply chain which they profess to care about so much has to plan their labour and plant requirements months if not years ahead. So whilst NR staff keep their highly paid jobs, some of those in the supply chain will lose theirs. These big public sector clients have no idea how business and the real world operate, just like their politician masters.

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