Tuesday 31 Oct 2023
Regulator confirms Network Rail's £43.1bn 2024-29 funding plans
- Region & Route:
- National
After more than two years of industry and stakeholder engagement and analysis, the Office of Road and Rail (ORR), the independent regulator that oversees Network Rail's activity, today announced its final determination.
This sets out what the ORR expects to see delivered within the funding available following its assessment of Network Rail’s plans for the next five-year control period – CP7 (1 April 2024 to 31 March 2029).
Andrew Haines, Network Rail chief executive, said: “The rail sector enjoys an almost unique level of funding certainty and that is a privilege that comes with serious responsibilities. More than £43bn will be spent over the next five years to deliver a safer and better railway for passengers and freight customers. Today’s announcement gives clarity and certainty for the railway and our supply chain partners and will now enable us to continue building on our detailed delivery plans.
“The UK and Scottish Governments’ funding commitment and today’s news is a significant vote of confidence in the industry’s future. The impact of inflation, tight public finances and the need to invest more to manage the impact of more frequent extreme weather on the infrastructure does mean that our funding will need to go further than ever before.
“Throughout CP7 we are committing to delivering extensive investments across the length and breadth of the network. In addition to improvements to safety, we’ll work to boost train performance, usher in new technologies, invest significantly more funds to tackle climate change as well as make £3.6 billion of efficiency savings.”
Following today’s announcement, Network Rail will now carefully review the detail of the regulator’s determination, continue the planning work to develop its detailed CP7 delivery plan by the end of March 2024.
Notes to Editors
Notes to editors:
- Network Rail’s (NR) funding is set-out in five-year terms, called control periods. 2024 to 2029 is its seventh such term – CP7
- Over the past three years NR and its independent regulator - the Office of Road & Rail (ORR), have been working with government, industry partners and stakeholders to map out the railway's needs and aspirations for CP7
- NR’s funding envelope and priorities are set by the Government in its HLOS – High Level Output Statement and its SoFA – Statement of Funds Available, which were published late last year and since then NR and the ORR have been working through plans, needs, ambitions and detailed analysis to settle on a final determination that sets out NR’s funding package for CP7 and some key targets and expectations
- CP7 will see spending on climate change increase to £2.2bn across Britain compared to £1bn in CP6
- Over the next five months, NR will continue work on its detailed plans for operating maintaining and renewing the network for CP7, which it plans to publish at the end of March next year. Enhancements are funded separately on a case-by-case basis
- The next five months will also mark the end of CP6 (2019-2024), a tumultuous period featuring significant events that have impacted the nation and the rail industry including the Covid-19 pandemic that saw a 95% drop-off in passengers during its height, a loss of passengers and revenue that still presents challenges today. CP6 also saw the railway play a major role in Queen Elizabeth II’s Platinum Jubilee, the Queen’s funeral (Operation London Bridge), King Charles III’s Coronation, and of course the Commonwealth Games and Eurovision and delivering scores of railway projects including the Barrhead to Glasgow and Midland Main Line electrification projects, the Severn Estuary resilience programme, Transpennine Route Upgrade and Gatwick Airport station upgrade. These projects will significantly improve passenger journeys and help address our carbon footprint
- CP6 will also see Network Rail exceed the efficiency targets set for it for the period by the ORR achieving £4bn against a target of £3.5bn. This has been achieved through such measures as Project Speed – cutting the time and cost of our projects, modernising our workforce and structures and introducing new technology and innovation. CP7 sees an efficiency target of £3.6bn being set and while there is still much work to be done to identify the detail, it will involved a range of strategic initiatives covering technology, contracting and engagement with the supply chain, innovation, and smarter ways of working that will save time and money
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