Network Rail is to cut costs by £1.7Bn over the next five years while spending £21Bn on running the rail network including £12Bn on a programme of improvements and £5Bn on maintenance.
The 20% efficiency savings have been ordered by the Office of Rail Regulation (ORR) in its final determination for 2014-2019. The savings are to be made by using new technologies, improved management and more efficient ways of working.
Within the planned total investment there will be an increase of £109M to close some 500 level crossings and improve safety at hundreds more of the highest risk crossings.
Safety of track workers is to be improved with £250M allocated to new equipment and safer working practices. The budget also includes £571M additional funds for improvements to structures like bridges and tunnels.
Some £7Bn of the £12Bn allocated to infrastructure improvements designed to ease congestion and improve performance of the railways does not yet have full approval as delivery plans and costs have not been fully worked up. The ORR has given Network Rail until March 2015 to develop plans before final approval is granted.
The ORR says better asset management will allow Network Rail to move from a ‘find and fix’ maintenance approach to a ‘predict and prevent’ preventive maintenance regime that will help to boost capacity and improve network performance.
The ORR says it will introduce new checks to monitor progress on making the network more resilient to bad weather and climate change.
ORR Chief Executive Richard Price said that Network Rail had made great strides in improving safety, performance and efficiency, but with this funding, closer working with the rest of the industry, and learning from past experience, was capable of delivering more for customers and taxpayers.
(Photo: Network Rail)