Changes to the way Network Rail delivers infrastructure projects worth £2bn a year come into force yesterday – part of a wider programme of reforms at the company that aim to encourage competition and drive down costs.
The new, regionally based business – Network Rail Infrastructure Projects – has been created, with four regional directors and three programme directors responsible for delivery of major renewal and enhancement infrastructure in their area. They will manage their own profit and loss and will be charged with winning work under a new competitive structure proposed by Network Rail.
A new client function has also been created within Network Rail that will define project outputs and work with delivery organisations much earlier in the project lifecycle. In most instances the delivery organisation will be Network Rail Infrastructure Projects; however some lower risk projects will be tendered to the market in order to benchmark the company’s capital project delivery.
To enable open competition for this work, Network Rail Infrastructure Projects will need to become a separate legal entity. This is planned for 2013, when it can start to bid against other market competitors for some of Network Rail’s capital programme for Control Period 5 (2014-19), as well as for other UK off-network projects.