THE GOVERNMENT has launched a call for market-led proposals (MLPs) to enhance the railway, highlighting delivery of a new southern rail link to Heathrow Airport as one scheme for which it wishes to receive proposals.
The call for ideas seeks financially credible schemes not requiring Government support; guidance indicates promotors and investors may call on government-backed sources of funding, but MLPs that maximise use of alternative funding sources will be prioritised.
Following a series of Investment Opportunity Days in May, initial proposals are due to be submitted to the Department for Transport in June and July, with Government to provide an initial response in the autumn.
An MLP is defined as a project promoted by the private sector that addresses an opportunity not necessarily identified or prioritised by DfT or through Network Rail’s planning process. In rail, DfT says an MLP could be developed or promoted by ports, train operators, freight operators, housing developers, financial investors or a consortium of such parties. The aims in encouraging MLPs are to increase investment in the railway, relieve the burden on taxpayers and farepayers, open up the development and delivery of rail infrastructure and create contestability.
On the Heathrow link, Government notes it is continuing to work on developing plans for a western rail access to the airport, comprising a new line connecting to the Great Western main line. For a southern rail link, it is taking a different approach, looking to ‘harness new and innovative ideas’.
Government guidance outlines two categories of MLPs. A Category 1 proposal has no public funding requirement (either direct or indirect), no contractual requirement involving government action and no asset exclusivity requests. Such schemes are not required to enter a procurement process and will be assessed through existing Network Rail and Office of Rail and Road processes. Category 2 proposals, which may require some form of public funding, contractual change or asset exclusivity, are subject to procurement and will compete with other unfunded government projects for money, requiring ‘a compelling business case’. Government gives as an example of a Category 2 scheme an enhancement where the cost of the scheme is recovered through track access charges.