The Government has announced a direct grant to Network Rail of up to £34.7bn between 2019 and 2024, which it says will allow the infrastructure operator to spend nearly £48bn once its expected income is included.
The Department for Transport (DfT) said a new focus on everyday services - with more maintenance and ‘a huge uplift in renewals’ - will see billions more invested in renewing existing infrastructure to improve punctuality and reliability.
Transport secretary Chris Grayling
Transport secretary Chris Grayling also announced a new funding process for major upgrades and enhancements where funds will be allocated separately. The DfT said this would ‘provide more rigour in investment decisions’.
Mr Grayling said: ‘Passengers want a railway they can rely on and that’s where this huge investment will make a real difference to their everyday lives - by renewing more tracks earlier and increasing maintenance to deliver far better services.
‘This investment is about boosting reliability and punctuality for millions of journeys, and we will do this alongside building major upgrades around the country and delivering new, faster, more comfortable trains.’
The DfT’s Statement of Funds Available (SOFA) for Network Rail sets out a direct grant of up to £34.7bn for Control Period 6 (2019 to 2024). It said total spending will be around £47.9bn once Network Rail’s expected income is calculated and added to the pot. This compares with Network Rail’s five-year budget to 2019 of £38.5bn, which Transport Network understands included Network Rail's income.
The SOFA says: ‘The secretary of state expects the remaining expenditure to be funded by income Network Rail receives from its customers (train operators, both passenger and freight) and its commercial activities.’
The DfT added that although the announcement includes funding for the early stages of developing new rail schemes, the Government will now allocate funds separately for major upgrades following a new process ‘to ensure they are deliverable and secure the best value for money for the tax payer’. More details of this will be set out later this year.
Anthony Smith, chief executive of watchdog Transport Focus, said: ‘Passengers will welcome this ongoing high level of railway investment. Further investment through future major projects and franchises will boost the spending pot even more.
‘We’re pleased to see that Government is listening to what passengers want – better day-to-day reliability – and making that the main focus. Passengers tell us they want more reliable trains, a better chance of getting a seat or at least standing in comfort, and less delays. This investment will help underpin these improvements.'
He added: ‘The proof of the value of this spend will be when passengers start to see more reliable services and better value for money. Passengers now pump around £9bn a year into the industry. In return they should expect the basic promises made by the industry to be kept.’