Review calls for more private finance in railways

17 Mar 16

A government review has ruled out a full sell-off of Network Rail but set out proposals to expand the use of private funds in upgrades.

The report by Nicola Shaw, chief executive of the privatised High Speed 1 rail route, called for the needs of passengers and freight shippers to be placed at the heart of rail infrastructure management.

The review was commissioned by ministers following cost over-runs and missed targets in the firm’s latest five-year funding period for maintenance and upgrades to the network.
Shaw concluded that changes to how the company worked were needed so it could meet forecast growth in demand in the future. Among the proposals was a call for third party funding and financing to be opened up in order to broaden sources of investment and to support innovation and growth.

Options to be considered include letting some routes to operators as a concession, should be considered if they could speed up delivery of improvements for passengers and release government capital.

The report also called for greater devolution within Network Rail so the company’s eight geographical divisions, which are called routes, have a much greater degree of autonomy to coordinate plans with customers, passengers and freight shippers.

Routes should be given freedom to develop plans based on these needs and recognising the role of the railway in the wider transport, economic and social objectives of the area.

Given additional powers, these routes should then be required to find local sources of funding and financing, including from those who would stand to benefit from upgrades such as local businesses or housing developers.

In addition, a new route should be created by NR covering the North of England that would work closely with other authorities in the region to improve transport provision.

Responding to the report, transport secretary Patrick McLoughlin said he welcomed the recommendations.
“The Shaw report proposes strengthening the role of Network Rail route managers to increase accountability and efficiency. It also recommends a new northern route, and a new freight route to ensure the rail freight industry can continue to contribute to growth,” he stated. “I will make a fuller response to the Shaw report later this year.”
Network Rail chief executive Mark Carne said he was pleased Shaw had concluded that reforms already underway to give greater control to regional routes were right.
“I also endorse her desire to see more private finance coming into the railways,” he stated.

“We have been successful with this in the past and I consider that more private money and funding from the people who will benefit from railway improvements is a sensible way to deliver a bigger and better railway for the nation.

“We’ll work with the Department for Transport as they now consider these recommendations and we look forward to a future which I genuinely believe is bright for the railways and for the ever growing number of passengers.”

Network Rail’s current eight routes are:


London North Eastern & East Midlands

London North Western


South East




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