Posted 7th December 2016 | No Comments

Network Rail puts project funding under spotlight

NETWORK RAIL is turning a spotlight on how it carries out projects, just a few hours after transport secretary Chris Grayling had announced the creation of a new standalone company to manage the construction and maintenance of East West Rail with private sector involvement. It will start work in the New Year under the chairmanship of Rob Brighouse, and will work in partnership with a franchised operator in due course.

Alongside this decision, a review into how Network Rail funds infrastructure projects is now to be carried out by Professor Peter Hansford (pictured), who has over 40 years’ experience in major infrastructure and building projects in the UK and overseas. He spent 20 years as a consultant, advising on infrastructure developments and capital investment programmes. He has also been a government advisor, and is now professor of construction and infrastructure policy at University College London. He is a past president of the Institution of Civil Engineers and a Fellow of the Royal Academy of Engineering.

Network Rail chief executive Mark Carne also pledged his commitment to removing any barriers to competition in all elements of projects a few days ago.

These developments are being seen as a reaction to continuing government concern about Network Rail's costs, and whether it should be seeking private sector finance to reduce pressure on the Treasury, but the trend is being bitterly opposed by rail unions, which argue that involving the private sector could open the door to a rerun of the disastrous reign of Railtrack between 1996 and 2002, when there were several major railway accidents.

Network Rail chief executive Mark Carne said: “We need to act more like a private business with customers’ needs at the heart of everything we do. Led by Peter, this review is due to start immediately and demonstrates mine and the company’s commitment to identify and break down any barriers that currently discourage either third party funding and financing of projects, innovation or new models of delivery.

“Peter has a wealth of experience in delivering complex infrastructure projects and in reviewing them. I’m delighted he’s agreed to head up this important review so that we can find out what we need to do to embrace competition at every stage of a project, and start doing it.”

Professor Hansford added: "Having worked for many years on both delivering and reviewing complex infrastructure projects, I understand the complexities involved to ensure competition is encouraged in order to get the best deal for customers.

“I will be identifying and addressing all barriers – building on the work already underway by the RDG and Network Rail in investigating alternative ways to finance enhancements and reviewing asset protection processes.”

RMT general secretary Mick Cash has forecast 'the mother of all battles' if Network Rail is privatised, although transport secretary Chris Grayling has ruled that out.

Professor Hansford's review has already begun, and his report is due in the spring.