Archive - Coucher, June 2008

Iain Coucher, Chief Executive of Network Rail, addressed the Fourth Friday Club on 27 June 2008.

The following is an edited version of his address.

Team Railway is a great team, and we have much to be proud of.
Punctuality is at its highest ever levels: in the first half of 2008,
there were only 27 days in which the network-wide Public Performance Measure
slipped below 90%. As a result, passenger satisfaction levels continue to
soar.

We also have the best safety record ever. Collectively, we have worked hard
to make rail the safest form of passenger transport in the UK.
There are record levels of investment in the industry. Our rolling stock has
an average age of 15 years, which makes it one of the youngest train fleets
in Europe. At Network Rail, we have been pouring money into the track and
signalling: we spent £1.85billion on renewals last year, and a further
£1billion on expanding the system with items such as new platforms.
The successful opening of High Speed 1 last November, and the magnificent
restoration of St Pancras station, are testaments to the planning skills in
this industry.

Network Rail is working hard to expand the skills base, and the railway is
seen as an attractive place to work. We had 3,500 applications for the 240
places available this September at our apprentice training centre at HMS
Sultan in Gosport.

Yes, buts
So we have an expanding railway which is meeting the rising expectations of
customers and freight users.

More people want to travel on trains early in the morning and late at night,
which cuts into our opportunities for undertaking engineering work. Can we
continue to accommodate this demand, while working to expand and renew the
railway?

Yes, we can, but it is a Œyes, butŠ¹ I enter this caveat, because the scale
of efficiencies that we are expected to achieve in the Office of Rail
Regulation¹s (ORR) draft Determination for Control Period 4 (CP4) is
unrealistic.

Observers are fond of comparing Network Rail¹s performance with that of
foreign railways. But these comparisons can be misleading. Some other
countries have lower cost bases: for example, smaller countries which have
benefited from high and steady levels of investment over many decades.
Or a railway may be taking a Œmaintenance holiday¹. For example, there is
some worry about the non-TGV routes in France, where they seem to be taking
a maintenance holiday. I have had experience of the consequences of the
Œholiday¹ in this country some five or ten years ago, and I know that this
is a dangerous path to go down.

Expectations

Network Rail has made efficiencies of the order of 30% since it took over.
But can we achieve massive amounts again over the next five years, as we
have been asked to do? This request has been made against a background of
rising fuel prices, increasing prices for the copper that we use in cabling,
and record levels of traffic. Can we accommodate all that at the same time
as achieving big cuts in operating expenditure? Such a scenario is just not
credible.

When we look at society's expectations for the railways, the implied scale
of change is immense. If we are to accommodate the levels of traffic
predicted, we need heavy investment in processes and technology. Take
information technology, for example: if Network Rail was to behave in line
with policy in other comparable industries, it would be investing around
£90million annually in IT. Yet what has ORR allowed us? £7million a year.
The ORR¹s draft determination for CP4 sets our expenditure at a level which
is insufficient to meet the expectations of passenger and freight customers.
As it stands, it is impossible to accept, and we will use everything in our
power to fight for a fair and reasonable settlement.

Assuming we get it, the future is bright. We will finish the work on the
West Coast Route Modernisation this year, allowing faster and more frequent
trains on that line. Further projects in prospect will transform the
railway: Thameslink, Crossrail, the Airdrie-Bathgate reopening, Glasgow
Airport Rail Link, rebuilding at Reading and Birmingham New Street stationsŠ
and a host of smaller schemes besides. The idea of a rolling programme of
electrification is gaining ground, and we have initiated a study into the
prospects for new railway lines.

The cloud on the horizon is what happens over CP4. The ORR will make its
final Determination in November this year, and then Network Rail has to
decide whether to accept that Determination or not. If we decide not to
accept it, the matter will be referred to the Competition Commission.
Our position at present is that we do not believe we can meet the
expectations placed on us as regards capacity and performance with the
funding we have been promised. MR

Iain Coucher, Chief Executive of Network Rail, addressed the Fourth Friday Club on 27 June 2008.

Expectations

Modern Railways / Railway Forum Fourth Friday Club
27 June 2008 meeting

Speaker: Iain Coucher, Chief Executive, Network Rail

Click to return to the top of the page.

Iain Coucher, Chief Executive of Network Rail, addressed the Fourth Friday Club on 27 June 2008.

Expectations

Modern Railways / Railway Forum Fourth Friday Club 27 June 2008 meeting

Speaker: Iain Coucher, Chief Executive, Network Rail

Click to return to the top of the page.

Modern Railways / Railway Forum Fourth Friday Club
27 June 2008 meeting