Media centre

Thursday 8 Aug 2013

Investment in growing railway delivers £46m boost to businesses in the north east

Region & Route:

Investment in the rail network has generated more than £46m of work for businesses in the north east over the past year, according to new figures released today by Network Rail.

Over half the money spent building a bigger, better railway for Britain in 2012/13 went to small and medium-sized businesses based in the region. This helped support economic growth and jobs across a range of industries.

Chief Secretary to the Treasury, Danny Alexander, said: “Investing in infrastructure has a direct effect on the economy, creating jobs, and giving Britain the infrastructure we need to build a stronger economy and fairer society.

“This report is excellent in highlighting the opportunities for small and medium sized businesses that come with infrastructure investment. That is why we have set out £100bn of investment in infrastructure over the next Parliament, including supporting the largest programme of investment in rail since the Victorian era. I’m very glad to see that Network Rail are doing their bit to drive sustainable and balanced economic growth across the UK.”

In the north east, Network Rail has contracts with several small and medium sized enterprises as well as contracts with the north east regional offices of Miller Construction Ltd, a local supplier with a strong regional heritage, who delivered a purpose-built maintenance and training unit in Gateshead last year. Local contractors are also being used for the refurbishment of Newcastle station.

Roger Dickinson, regional director, Network Rail Infrastructure Projects, said: “Investment in the railway is giving businesses in the north east a much needed boost, helping to create jobs and support a growing local economy.

“Our railway transports millions of tonnes of freight and hundreds of thousands of passengers everyday, connecting people and businesses across the north east and beyond. Passenger numbers in the region continue to grow and we have ambitious plans for the next five years to meet that demand. We will continue to invest in projects to increase rail capacity and connectivity across the region. By building a better railway for Britain we will continue to contribute to sustainable economic growth across the north east and the country as a whole.”

Across Britain, Network Rail’s major projects division invested £3.2bn in 2012/13. This investment has sustained over 90,000 full-time jobs nationwide in addition to the 34,000 people directly employed by Network Rail, generating significant financial returns to central government through tax revenue and savings on benefits as well as boosting local economies.

The rail industry’s supply chain is both extended and varied, ranging from professional services to the construction industry. Rail investment is therefore an important driver of growth across many of the UK’s industrial sectors.

In the past four years, Network Rail has generated £17.3bn of work for its national supply chain, of which £6.2bn has been with small and medium-sized businesses – a 22% increase on the previous four years. Planned enhancements and renewals expenditure between 2014 and 2019 is approximately £25bn, with 99% of this work to be undertaken by UK-based companies.