£9bn railway investment announced by coalition

 

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A £9.4bn package of investment in the railways in England and Wales, including £4.2bn of new schemes, has been unveiled by the government.

The plans include electrification of the Midland Main Line between Bedford and Sheffield.

Other rail improvements have been unveiled for the Manchester area, south Wales and East Coast Main Line.

Prime Minister David Cameron called it the "biggest modernisation of our railways since the Victorian era".

During a visit to Birmingham to announce the railway investment, the PM said it would lead to the electrification of an extra 850 miles of track.

He said: "This investment will mean faster journeys, more seats, better access to stations, greater freight links and a truly world-class rail network."

Deputy Prime Minister Nick Clegg, who joined the PM on the visit, said the plans would help "close the north south divide".

It includes £5.2bn for the completion of current schemes, such as Crossrail and Thameslink and £4.2bn for new projects.

These include:

  • A high-capacity "electric spine" running from Yorkshire and the West Midlands to south coast ports, boosting passenger and freight capacity
  • An £800m electrification and upgrade from Sheffield to Bedford, completing the full electrification of the Midland Main Line
  • Electrification extended from Cardiff to Swansea, costing £600m, plus electrification of the Welsh valley lines
  • The Northern Hub - a series of projects around Manchester worth £322m that improve northern rail capacity to get more and faster trains across the north of England
  • Upgrades to the East Coast Main Line from London to Leeds and Newcastle worth £240m to create faster journeys and increase capacity
  • Upgrades to stations and tracks creating capacity for an additional 140,000 daily rail commutes around cities at peak times, including £350m for lengthening platforms at London's Waterloo station
  • A new £500m rail link between the Great Western Main Line and Heathrow

Building work on the rail projects will not start until at least 2014, as the announcement covers the period 2014 to 2019.

Map of planned electrification of rail routes

The government said it would be funded "in part from fare rises already announced in 2010 and also from the substantial efficiency savings which projects like electrification will have on the long-term operating costs of the railways".

In January this year, passengers faced average increases of RPI inflation plus 1% on regulated fares, which are set to rise by RPI plus 3% in January 2013 and 14.

Transport Secretary Justine Greening told BBC Radio 4's Today programme the government had a long-term plan to make the rail industry work more efficiently and stop the above-inflation fare rises.

"We've got to get the money from somewhere so, for the time being, the passengers are paying," she said.

"We all know that diesel is massively expensive so if we can move over to electric trains, not only are they greener, they're also cheaper and also they are lighter too, so what that means is that when they are on the track they don't damage it so much, so maintenance costs go down too," she added.

Regarding access to the rail network, she later told Parliament she was initially making £20m available for Network Rail to invite bids for new stations.

Value for money

Shadow transport secretary Maria Eagle said: "We welcome this investment, it was actually first announced under the last Labour government... but this won't help jobs and growth now, as there's not going to be a penny spent until after 2014."

Analysis

A lot of electric railway lines and new track can be bought for £9.4bn but how does the money break down and what difference could it make? Oh, and who pays for it?

Well, for starters, £5.2bn will go to either continue or finish off projects that have been under way for some years.

But the rest is new and it will mean faster journey times, more seats and spruced up stations, with many regions in England and Wales benefiting, especially across the north of England.

The trick will be to fund all of this whizzy new kit without ticket prices going through the roof. We already know season tickets, along with some other fares, will go up by inflation plus 3% in January 2013 and January 2014.

They'll then go up by inflation plus 1% in 2015. The government says it wants to stop further rises by saving money across the industry. If it can't manage that, fares could rise for many years to come to help pay for all this new investment.

She refused to rule out renationalising the railways to ensure better value for money.

But Labour played down the significance of her comments, saying the focus would be on local solutions.

Bob Crow, general secretary of transport union the RMT, said: "What we need is investment in rail today not yet another political promise of jam tomorrow."

Chief executive of rail customer watchdog Passenger Focus, Anthony Smith, said passengers would welcome the "scale and ambition" of the investment.

But he added: "Value for money remains a concern. Passengers will want to see the government avoid above-inflation fare increases. These investments must be delivered in a cost-effective way."

Campaign for Better Transport chief executive Stephen Joseph said the investment was good news, but the two years of fare increases would mean many passengers could not afford its benefits.

"At a time when public subsidy of the railways is falling and efficiency savings in the industry are already reducing costs, there is simply no need to make passengers pay over the odds," he said.

Network Rail is funded by a £3.5bn annual government grant and income from track access charges - either rail fares or revenue support payments from the government. It also borrows money which the government guarantees.

 

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  • rate this
    0

    Comment number 238.

    Additional investment in railways is great news for all.
    BUT:
    Unless the existing skewed capitalism of the sytem is fixed BEFORE these works start, the effect of the £9billion will be severely disabled.
    Let private capital cream off ALL the profits, and the taxpayer pay ALL the losses, and you have a recipe for disaster. Our children and grandchildren will pay the price.

  • rate this
    0

    Comment number 237.

    Another rise on rail tickets.Where do these people think we get money from?A tree?

  • rate this
    +1

    Comment number 236.

    226 Adam
    It costs me £15 a day to park at the station and there are no buses at the time I leave home for the train - my annual rail season ticket is just over £5000 - which is why I drive as parking at the other end only costs me £1000 a year.

  • rate this
    -1

    Comment number 235.

    If £9bn is going to smarten up existing rail lines, what's the point of HS2? The UK is not the same as continental Europe. We need reliable, punctual trains, not expensive plans to satisfy the construction industry. Let the builders maintain proper roads, houses on brown field sites, etc. Not despoiling the countryside.

  • rate this
    0

    Comment number 234.

    It is great to see on the TV news all the billions being promised for the railways, will some of this money be spent on a new mainline station for Gloucester, that is one of this countries original Roman Forts, sadley neglected By our MP , Government and both councils here in Gloucester

  • rate this
    -3

    Comment number 233.

    90.5% of journeys within the UK are made by road, yet we are spending £9.4bn on the railways, which carry 8%?

    Let's fix some potholes on our roads before we waste money on railways.

  • rate this
    -4

    Comment number 232.

    Let private investors stump up the investment funds... They have been granted annual fare increases at an average of 3% above inflation for the past ten years.
    Or renationalise and invest the £9.4bill plus £34bill (for HST) across the whole network.
    Of course there is another option... rip up and replace the entire system with guided roadways for buses, trucks and coomercial vehicles.

  • rate this
    +1

    Comment number 231.

    200.Ian - It's a pity you didnt check your facts. Phase 1 of HS2 from London to Birmingham is 192KM and will cost £17.4B, the entire HS2 from London to Manchester and Leeds is 540KM and will cost £32B. I suggest you need to re-calculate the costs again.

  • rate this
    0

    Comment number 230.

    How about before any contracts are signed the govt get some smart savvy private legal advice to ensure these private companies don't rip us off yet again and make sure that for every foreign worker used ten British employees must be used or they pay penalties.

  • rate this
    +4

    Comment number 229.

    At last, they're finally doing something to stimulate the economy. Austerity has only managed to line the pockets of the rich!

  • rate this
    +1

    Comment number 228.

    The cost of travelling by train has become so expensive that for me it is prohibitive. Griping then - my money is being used to subsidide a privately run transport system that I can't afford to travel on. Ever get the feeling you've been cheated (again)?

  • rate this
    +5

    Comment number 227.

    Anyone sick of their gas, electric, transport prices going up and up? Yet at the same time hearing the companies running the ex national systems with better than expected profits and massive bonus's? I am, wish we re nationalized half of each industry and regained some dignity and competiveness.

  • rate this
    +2

    Comment number 226.

    197.
    KJ

    Some of us don't have a choice and have to use trains to travel to work.

    For me it's either £800 for an annual rail pass or £15 a day for city centre parking.


    211.
    Andrew K

    I agree, the railways are in a bit of a mess. There's now more government involvement in rail than in the days of BR. The tendering of franchises should be done by NR, not the DfT.

    It's a no-brainer.

  • rate this
    +1

    Comment number 225.

    @204. To be fair people are "whining" because they know full well that the public won't be able to afford the rail. Its self defeating. It would be interesting if all the current subsidies in these private rail companies was removed but added to each fare and lets how much the fares would be then. This is unsustainable

  • rate this
    +2

    Comment number 224.

    Tories obviously in a mess when they have to resort to doing something positive but welcome nonetheless.

    Agree with Victor @ 210 road to rail programme for freight trunking - regardless of the Eddie Stobart lobby

  • rate this
    -1

    Comment number 223.

    Estimate £9.4b HS2 estimate £32b, by the time these are delivered, (if ever) actual costs, what do folk reckon? My guesstimations are, £30b and £65b. You think I'm crazy? Original est for Olympics, £2.5b actual cost 4 x that. So am I being crazy or just realistic?

  • rate this
    -3

    Comment number 222.

    Why are 'we' the tax payer paying? Does the government get a share of the privitised companies? Looking forward to my share of the dividend!

    If the train companies need to invest then they need to borrow. If this puts the fares up then tough! If you dont want to pay the higher train fares "buy a car"! or travel less....

  • rate this
    +3

    Comment number 221.

    No one can argue that the proposals are not 'good' However, they are not proposals - they are a vague statement of what might happen some time in the future (as someone identified, just before an election - Sheffield Hallam = electrification=Clegg's seat?????) Better than HS2 - can we have more of these from the HS2 savings?

  • rate this
    +13

    Comment number 220.

    If I wanted to go to London by train at 8am tomorrow it would cost me £138.50 and that is just one way. It's almost exactly the same as I paid a couple of weeks ago, again with only one day's notice, to fly to Alicante and back. How can 200 miles on a train cost the same as 2000 miles in a plane?

  • rate this
    -23

    Comment number 219.

    We need to improve services for cyclists and those that want to start and end their journey by bike! Anyway £9bn is nothing compared to what's wasted on the road network...

 

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