Posted 24th November 2011 | 11 Comments
Slipping deadlines trigger speculation about rail policy
The order for replacement Thameslink trains is still not confirmed, as uncertainty grows
WITH SEVERAL key rail decisions postponed until undetermined dates in the New Year, speculation is growing that the government's rail plans are in tatters. A union leader is also claiming that the growing financial crisis in the Eurozone is now contributing to the uncertainty.
Before he moved to Defence, former transport secretary Philip Hammond had promised to produce a railway White Paper which should have been published about now, but his successor Justine Greening has delayed publication of the document, now being described as a 'Command Paper', until 'early next year'.
In a statement a few days ago, she attributed this change of publication date to a need for 'greater consideration of other issues central to the question of rail reform'.
These issues include the knotty problem of how much of the McNulty report on 'value for money' can be implemented following widespread criticism of some of his proposals, particularly those which involve reductions of staff.
Apart from McNulty, other contentious matters in Ms Greening's in-tray include January's fare increases, set to be an average of 8 per cent, and the highly criticised decision to award the £1.4 billion Thameslink rolling stock contract to Siemens rather than Bombardier in Derby, which it is claimed has put at least 10,000 British manufacturing jobs at risk.
Although Siemens was named as preferred bidder as long ago as June, the contract has still not been confirmed. The Department for Transport will not discuss the details of the decision, but its process has been upheld by the National Audit Office, which said last month that its preliminary examination of the Thameslink procurement calculations on a 'value for money' basis had revealed no flaws which would have justified a full inquiry.
It is generally believed that Siemens was chosen, at least in part, because it could offer a more attractive financing deal for around 300 four-car trains, which in turn is based on the fact that the German-based firm has a higher credit rating than Canadian Bombardier, and can borrow money more cheaply.
It is, however, this aspect of the deal which may be causing the delay. This is certainly the view of RMT general secretary Bob Crow, who believes that the financial crisis in the Eurozone is hampering Siemens in its search for funding at a low enough rate.
"The betrayal of Bombardier has taken another serious turn and is now bogged down in the chaos of the financial markets making a mockery of Government claims that they could not delay the tendering process by reconsidering the award of the contract to Derby," he said.
"Justine Greening is now sliding the whole exercise back off into the New Year simply to make life easier for Siemens as they struggle to put the finances together regardless of the fact that Bombardier are geared up and ready to go. That is pure sabotage of UK train building."
Both the White (or Command) Paper and the Thameslink deal are therefore held at red signals, and they are not alone.
The purchase of the next generation of intercity trains is also apparently stalled, although next February will mark the third anniversary of the date when the Agility Trains consortium, led by Hitachi, was named as preferred bidder to build Intercity Express.
The IEP procurement process has been dogged by repeated changes to the specification of the proposed fleet, which was originally to be a combination of electric, diesel and bi-modal units.
Since then, significant extensions of electrification have meant that the original mix is no longer appropriate, particularly on the Great Western Main Line, which is now to be electrified between London, Bristol and Cardiff. The signing of a contract with Agility appears to be as far off as ever.
The Scottish Government has added to the general furore by publishing a consultation of its own which suggests that all trains arriving in Scotland via the East Coast Main Line could terminate at Edinburgh after 2014.
There has already been considerable opposition to this and other proposals in the Scottish document, but if it came to pass then most of the East Coast allocation could be electric, with a small number of bi-modal units maintaining East Coast through services to Lincoln and Hull.
Reader Comments:
Views expressed in submitted comments are that of the author, and not necessarily shared by Railnews.
deltic08, Ripon, UK
30 year old Pacers, 30 year old Sprinters and now 30 year old 319s. Refurbished or not, 319s will still be 30 years old crappy trains by the time we get them. How long will they continue in service? Until they are 50 years old crappy trains. Are we supposed to be grateful? Why do we get everybody's cast offs in the North of England when the South East and London keep getting new trains?
Colin, London
Siemens were chosen because they build better trains, Bombardier has played the xenophobic card well, as many of the great unwashed couldn't give a monkeys where the trains are built, just that they are reliable and run on time. Last time that I checked, Bombardier was listed on the Toronto stock exchange, hardly British, yet alone European?
In about six years time, due to this nationalistic posturing, us poor folk in London will most likely be forced to accept an inferior rolling stock on Crossraill just to assuage the bigots. As Bombardier are already producing S, and 2009 stock for London Underground, and classes 377, 378, and 379 in recent times, it's hardly been a drought in orders?
Paul, Hants
There are two types of Command Papers. White Papers and Green Papers. The change of description is therefore not really significant - it is just the correct name for a 'White Paper' which is really just the nickname for a statement of government policy...
Trigger, Redhill
While everyone argues over the righteousness of the Siemens/Bombardier decision the poor commuters are still stuffed into too short trains, running at extended intervals. This includes those across the country that will be improved by the existing units being refurbished
Get the act together - get the first of these units delivered before the end of 2012 (not 2015 as planned) and start to deliver a decent commuter experience right across the country.
Lutz, London
If anything, the delays are due to the measures that are being put into place to try and maintain growth while the Eurozone spirals into recession. If anything, I expect additional rail infrastructure expenditure will be announced, along with existing proposals for future CPs being brought forward.
Joel Kosminsky, London, Britain
We are now on Transport Minister/Secretary no 34 since WW2, hardly a vote of confidence in transport, always the stepping stone to other things, never a true destination. So we have joke transport, pretend-integration, expensive fares and eye-watering profits from public service contracts. Road users don't pay the full price of highways, nor does aviation pay its true infrastructure costs, so why does rail (and bus) get hammered hard?
jak jay, sutton, united kingdom
Hate to say i agree with Bob Crowe but i do Eurozone debt crisis apart this whole
mess is down to one thing,the disater of rail privatisation before it we had a thriving rail building industry(the superb York Works) among others now we have a government who is more interested in giving jobs to Germans
jack99, swindon, UK
The most cost effective route is to build British Thameslink trains by British workers at Derby. The PM wants to rejuvenate British Industry so he should put his money where his mouth is and keep this work in the UK. At the moment the German government is just laughing at us.They together with the French would only give train orders to foreign companies provided they were built in their own respective countries.
Regarding GW electrification electrify in South Wales to Swansea , electrify also the Midland Main Line from Bedford to Leeds and then you can get all the ex West Coast Mk3 coaches out of storage plus the existing HST coaches put them behind a class 90/ 91 and you have a got a perfectly serviceable network of 125-140 mph trains at a fraction of the cost of the IEP Programme
The South West routes from Paddington to Penzance will remain HST hauled for the next 40 years plus as the IEP will not be powerful enough to get over the Devon Gradients west of Newton Abbot so why bother building this hybrid train as it will be useless right from the word go.
Melvyn Windebank, Canvey Island, Essex, England
I noticed that Cameron made 2 references (without being asked!) to cutting fuel duty for motorists and yet NEVER mentions the massive fare rises he is putting in place for rail users!!
I suppose these delays are because yet again we have a transport secretary who knows nothing about Transport!!!!
Was it really a year ago when these same projects were being held at red lights?
Paul Danon, London, United Kingdom
Does anyone know anything about what happened at the recent industry-forum whose existence was a near-secret?
Rajat Bhatla, London, United Kingdom
"It is generally believed that Siemens was chosen, at least in part, because it could offer a more attractive financing deal..based on the fact that the German- based firm has higher credit rating"
Did the decision makers consider the fact though that if they had contracted Bombardier, a UK based company instead, nearly 30-40% of what DfT would have paid the Bombardier consortium would have come back to the treasury by way of taxes, considering the numerous direct/indirect taxes in the chain?
I suppose what DfT pays Siemens consortium now will be an import, money mostly going out of the country, and significantly lesser tax receipts. Doubt that the savings from a better financing deal would offset this upcoming loss of tax revenue.