Regions short-changed on rail spending need increased support

28 June 2018

The Transport Committee publishes a report on funding gaps between London and regions needing economic regeneration, the electrification debate, and control period 6 funding and processes.

We, the Transport Committee, have been running an inquiry into rail infrastructure investment.

Find our full rail infrastructure investment report online or download the pdf version. You can also read the report summary or conclusions and recommendations in HTML.

Alternatively, read on for a brief overview, our recommendations, and the Chair’s comments.

Regional differences and funding gaps

We, the Transport Committee, found that current transport scheme appraisal methods will always favour London as they’re weighed heavily towards congestion reduction and journey time savings.

This actively disadvantages less economically buoyant regions and works against the Government's intention to "rebalance the economy".

While the Government's Rebalancing Toolkit published in December 2017 acknowledges the need for change, it is only supplementary guidance.

We’re not convinced it will make a material difference unless it’s mandatory, regularly reviewed, and put at the heart of Department for Transport's investment decisions rather than an afterthought.

‘Regional economies will never be able to catch up’

Lilian Greenwood MP, our committee Chair commented:

"The Secretary of State's cancellation of three rail electrification schemes in the Midlands, south Wales and Lake District only to be followed four days later by the announcement in principle to fund Crossrail 2 in London unsurprisingly re-ignited the debate about disparities in rail infrastructure investment between London and other regions.

The Treasury's own data shows that spending per head in London in 2016/17 was more than ten times that of the East Midlands. Regional economies will never be able to catch up with London while such inequalities exist.

While we accept that annual snapshots of comparative regional investment can be problematic, and that investment in one area can lead to benefits in another, some regions have faced decades of under-investment in their parts of the rail network.

They deserve to have a clear sense of what the Government is doing to help them attract transport investment and grow economically.

The Northern Powerhouse and Midlands Engine will struggle to live up to their names without tangible change."

The electrification debate and new technologies

During our rail infrastructure investment inquiry, we found that the electrification schemes cancelled in 2017 fell victim to the well-documented problems earlier in Control Period 5 (CP5, 2014-19). There simply was no more money available.

This led to the consideration of alternative traction options such as bi-mode diesel/electric operation and new technologies such as hydrogen and battery.

However, the Secretary of State's announcement focused entirely on the passenger benefits of the Department for Transport's new bi-mode approach and seemed to ignore the environmental costs.

We urge the Government to do more to support the development, testing, and ultimate deployment of new technologies on the network.

Meanwhile, we recommend the cancelled electrification schemes are recategorised as ‘pending’ and placed in the Rail Network Enhancements Pipeline (RNEP) for further development and design work, particularly focusing on cost reduction.

‘Government should have been more honest with Parliament and the public’

Committee Chair Lilian Greenwood stated:

"Our inquiry considered the electrification debate and the timing of the cancellation announcement - a process which has been complicated by the less than candid approach of the Secretary of State.

We are disappointed he did not engage more openly with our scrutiny of his decision. The Government should have been more honest with Parliament and the public about the real reason for the decision.

An announcement made by Written Statement on the last day before summer recess offered limited opportunity for debate and scrutiny."

Funding and processes for control period 6 (CP6)

We welcome the funding and process changes that the Department for Transport (DfT) has made to CP6 (2019-24), which should prevent the problems faced in CP5.

If DfT and Network Rail are to restore their damaged reputations and instil greater confidence in the railway industry to invest in its workforce, skills and innovation, we also recommend:

  • a mechanism to smooth out the renewals spending profile
  • full transparency of projects in the Rail Network Enhancements Pipeline
  • greater clarity about projects available for third party investment
  • streamlining of processes for market-led proposals

Further information

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Rail infrastructure investment inquiry

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