Your browser is no longer supported

For the best possible experience using our website we recommend you upgrade to a newer version or another browser.

Your browser appears to have cookies disabled. For the best experience of this website, please enable cookies in your browser

We'll assume we have your consent to use cookies, for example so you won't need to log in each time you visit our site.
Learn more

Network Rail debt to go on government balance sheet

Network Rail is to be reclassified as a central government body, it was revealed this week.

The Office for National Statistics (ONS) has announced a statistical change to its classification of Network Rail as a result of changes in European accounting guidelines.

As a result, Network Rail’s debt of around £30bn is to be reclassified as public sector debt for the purpose of government statistics. These new guidelines and the resulting reclassification come into effect on 1 September 2014.

Network Rail said its reclassification as a central government body was a statistical decision that does not alter the company’s structure as a not-for-dividend company, limited by guarantee, with members rather than shareholders.

“The business acts and operates today as it did yesterday, and its job of delivering a safe, reliable and improving railway for 4M daily users continues,” it added.

Network Rail and the Department for Transport have also published a Memorandum of Understanding (MoU) that outlines how they will ensure the company’s business continues as usual, it said.

The MoU also acknowledges that some small changes will be necessary as the company becomes accountable to Parliament for its finances.

At least initially, the company will continue to raise debt to fund its ongoing investment programme while the longer
term funding options are considered.

Critically, it said as an example, the company will retain commercial freedom to work collaboratively with train operators and suppliers in delivering improvements in the railway under the well established regulatory framework that provides stability of funding through the five year regulatory review process.

Have your say

You must sign in to make a comment

Please remember that the submission of any material is governed by our Terms and Conditions and by submitting material you confirm your agreement to these Terms and Conditions. Please note comments made online may also be published in the print edition of New Civil Engineer. Links may be included in your comments but HTML is not permitted.