NETWORK RAIL’S Routes have more to do to prepare for the start of Control Period 6 (2019-24), according to the Office of Rail and Road. In its monitor of NR for 2017-18, the regulator also expresses concern over the volume of deferred renewals, a lack of contingency in NR’s budget and declining performance.
ORR reports that, while it would not at this stage expect Routes to have fully developed workbanks, contractual arrangements and resources, NR analysis shows most Routes still have a substantial amount of work to do to get ready for the start of CP6. Further warnings surround deferred renewals – ORR says NR did not undertake £441 million of renewals work planned for 2017-18 and has built up a substantial backlog of work that will need to be caught up with in CP6 and beyond.
NR underperformed against its internal budget by £0.1 billion across the year, although this underperformance has improved on the first three years of the current Control Period. The regulator reports this is due to higher than budgeted Schedule 8 compensation payments for poor performance and the rates of renewals. NR’s debt grew by £5.5 billion to £50.3 billion in 2017-18, and the company expects to use all its remaining available borrowing for its planned activities this year. ORR says this means there is no contingency, and in view of underperformance so far in CP5 it considers this ‘risky’, although it would expect the company either to request additional funds from the Department for Transport or defer further renewals work into CP6.
Performance declined during 2017-18, with Public Performance Measure (PPM) nationally at 87.6%, 4.8% behind the regulatory target. Cancellations and Significant Lateness (CaSL) was 3.9%, 1.7% higher than the regulated target, with all 20 franchised operators missing both PPM and CaSL targets. ORR expressed particular concern about declining performance at South Western Railway, especially in view of the high proportion of delays attributed to NR. More positively, freight performance was ahead of target, while there was a 1.7% reduction in the number of infrastructure-related service affecting failures across the year.
In terms of enhancements, NR delivered 11 of 20 Entry Into Service Milestones during the year, including electrification between Maidenhead and Didcot and platform extensions at Waterloo. ORR notes concern around a number of enhancements schemes, including Great Western electrification, where NR is looking at options to complete electrification to Cardiff during 2019, along with the delayed North West electrification, while the milestone for Bromsgrove electrification is being revised from May this year to August.
The positive trend in safety continues, with no worker fatalities or industry-caused passenger deaths on NR infrastructure or stations across the year.
Network Rail Scotland, subject to a separate monitor, outperformed its internal budget by £37 million and saw an ongoing efficiency improvement. Electrification between Edinburgh and Glasgow via Falkirk was delivered in December 2017, over a year late and significantly over budget. Despite this, ORR reports increased confidence in NR’s ability to meet regulated milestones and remain within the funding settlement, while cautioning that complex construction activity remains in the final year of CP5, with the Stirling – Dunblane / Alloa (SDA) electrification project’s milestone viewed as ‘challenging’. The renewals position for 2017-18 was variable, with ORR reporting over-delivery of key volumes, change in work mix and some deferred delivery elsewhere. PPM performance for ScotRail and Caledonian Sleeper was down 0.9% on the previous year and missed its regulatory target by 2.5%.