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The UK Rail Supply Chain

Without doubt, the Railway Industry Association (RIA) represents a significant membership of companies engaged in supplying the rail industry, covering a multitude of different engineering disciplines. Darren Caplan, the chief executive of RIA, stated at its recent annual conference that the industry contributes £36 billion to the economy with over 300,000 employees, both of which are impressive numbers.

Scotland recognises that a steady workload to avoid peaks and troughs yields a secure industry employment base, which in turn leads to an alignment of customer and china wholesale supplier. Developing new projects with Network Rail in CP6 is proving something of a challenge.

A short introductory video showcased a number of companies that contribute with design, project and implementation activities and demonstrated the need for a pro-active and innovative supply chain to meet the increasing technological demands of an expanding and busy railway. However, as Darren explained in his opening address, four factors make these uncertain times.

Firstly, the big message coming across from RIA member companies is the problem of ‘boom and bust’ with project funding. Not having a steady work stream leads to recruitment uncertainty and the knock-on effect of having to acquire the right calibre of people when contracts are awarded only to make them redundant again when contracts are completed, all causing an increase in cost and delivery delay.

Secondly, whilst prestige projects such as HS2, Crossrail, National Electrification, Digital Railway and others are welcome, there is little in the way of co-ordination between them to ensure the available resources and skills are effectively distributed.

Thirdly, whilst funding is given to R&D for infrastructure innovation, no equivalent money is available for rolling stock development. The goal of decarbonisation by 2040 will require continued investment in electrification (although the cost of achieving this has to be brought down) and innovative new rolling stock – not only bi-mode of electric/diesel but battery technology and hydrogen as well. Some companies are already engaged in this, but very much as a speculative venture with no certainty of end-user acceptability.

Fourthly, a satisfactory Brexit is crucial for the rail industry to continue close ongoing technical co-operation with Europe. Around 20 per cent of the UK workforce is made up of mainland European employees and their expertise must not be lost. The UK has excellent export potential and frictionless trade is essential.

The political dimension

The compere for the conference was David Begg, now the chief executive of Transport Times but well known for his transport thinking at Edinburgh University over many years. He recalled the success of the ‘Save our Railway’ campaign in the 1990s, when retrenchment of the network was a real threat. Privatisation has brought an increase in ridership and the resulting big investment projects. HS2 to Birmingham is just about assured, but David suggested that doubts may still exist with stage 2b to Leeds and Manchester.

Having the Secretary of State for Transport, Chris Grayling, as a speaker was a real bonus in these uncertain times. His enthusiasm for transport in general came across, but he is adamant that value for money has to be achieved. No more so is this reflected than in electrification projects, where both costs and timescale have spiralled out of control, on the Great Western in particular.

Chris Grayling was pleased that many good things are coming out of the industry, as witnessed by UK showings at the recent InnoTrans exhibition in Berlin. However, more new thinking is required for the whole railway. New propulsion methods cannot be ignored, witness hydrogen and hybrid train projects in Germany, which could be ideal for the East – West Railway from Oxford to Cambridge, essentially a commuter railway in the making.

Digital railway techniques should provide a solution to many of the current capacity problems. The money is there – but the processes for spending it must be speeded up to ensure investment in new technology and innovation is spent wisely.

The forthcoming Rail Review, whilst concentrating on the franchising model, will aim to produce a joined-up railway, something that has to be a team effort. The industry will change shape and the supply chain must be part of that, and there is a danger that the customers – the travelling public and freight users – have become forgotten with too much focus being placed on engineering for its own sake. The Trans Pennine upgrade from Leeds to Manchester is predicting line closures of 39 weeks per year for the next five years, which is unacceptable.

The clamour for ‘boom and bust’ removal is noted but the industry should not expect safe and secure business for all time from government. While there is no shortage of work in the UK at present, with many schemes underway (Trans Pennine, Ely Junction, Dawlish consolidation, East-West rail to name but a few), huge opportunities also exist in other countries around the world and the government will support companies that engage with this – Chris Grayling even offered to make ministerial visits if the situation merited it. Despite the problems of 2018 – electrification delay, timetable introduction, Crossrail – all caused by ‘it will be alright on the night’ thinking – more opportunities exist for rail than at any time in the past with considerable private investment adding to central funding of £48 billion for CP6.

HS2 is crucial, but it should be viewed as a series of bypasses to free up space on the existing railway rather than having high speed as its primary aim. The industry has to be better at making the case for HS2, where state of the art technology and increased speed is only sensible. The project will not be micromanaged by government and it is up to big companies to support smaller firms down the supply chain.

Calls for a vertically integrated railway will be considered in the current Rail Review, led by Keith Williams, but wholesale nationalisation like wholesale from china will only suck private investment out of the industry. Greater employee participation in the industry’s future will help de-militarise the present conflicts.

Alternative politics

Andy McDonald, the shadow secretary for transport, exposed some of the myths about the opposition’s view on rail. Nationalisation will only apply to the TOCs, and only then on franchise expiry. He claimed that the evidence in support of this is overwhelming, using Virgin East Coast and the forthcoming bailout of Anglia to demonstrate that the system is not fit for purpose.

The announced Rail Review will not look at Network Rail, existing franchises or the ORR, and Andy MacDonald doesn’t believe it is needed to show up the main shortcomings. Labour has no intention to nationalise any part of the supply chain, indeed a strong supply industry is recognised as vital. A joined-up railway is the prime objective, with timetable compilation and regular asset maintenance being the mainstay of this.

A Labour government will create a public company to run the railways, with the remit of less expensive fares, easier through-journeys and close co-operation with local authorities. Control periods will be of seven years duration, with planning for the next period taking place two years before expiry of the existing one to ensure the relevant feedback and lessons are understood.

The ceasing of the electrification schemes is viewed as a major error, although the cost for new projects must be reduced. Key to part of this is the continuance of the National Skills Academy for Rail with measures put in to retain skilled staff within the industry.

On Brexit, Labour respects the referendum result despite the appalling handling of subsequent negotiations, but would maintain a customs union with the rest of Europe.

Whilst not advocating a return to British Rail, that era of industry did achieve results with minimum money. Some lessons from the past need re-learning. Railways need less political interference and should be left to the rail experts. Network Rail is far from perfect, with costs being too high, not helped by the industry fragmentation. The Digital Railway vision is supported, but the digital platforms must be much more than just the roll out of ETCS.

Conference attendees reflecting on the two political viewpoints might even consider that they are not so very different, at least for the longer-term vision.

Regional considerations

Regional clamour for a less London-centric investment approach is often vocal, but is this factual, or even fair? Four speakers from different parts of the country gave their view.

Bill Reeve, the director of rail for Transport Scotland and an engineer by background, had perhaps the easiest task as the results of Scottish rail investment are there for all to see. New lines, improved journey times, reduced emissions, better accessibility and affordability are all part of this. The electrification of the Shotts line is running ahead of time and within budget.

Whilst Scotland is only 11 per cent of the UK railway, it has 358 stations and 93.8 million passenger journeys each year, demonstrating how a devolved government can succeed.

Wales is different, as the Welsh Assembly does not have the same devolved powers as Scotland. Nonetheless, James Price from Transport for Wales stated that 100 per cent of the trains in Wales will be renewed by 2023, 50 per cent of them being assembled in the province. Coupled with 600 new jobs and £194 million of investment, this will yield 65 per cent more capacity.

Novel ideas will be free travel for under-11s, half fare for 12-18 year olds and free travel for up to 16 year olds off peak.

The big project will be the development of the Cardiff Metro operation, with a minimum of four services per hour on all routes, vertically integrated as much as possible and with better-value electrification. Improvements to information systems and closures of level crossings will be progressed.

Maria Machancoses, a director on the Midlands Connect body, explained the vision for much improved integration between east and west, from Hereford through to Nottingham. Foreseen is a £575 million boost in annual investment to achieve six million more passengers per year and many more freight paths. Connectivity with HS2 will be vital, but it needs to be influenced and integrated.

The North is perhaps the most vociferous of the regions with Barry White, the chief executive of Transport for the North, wanting increasing devolution. Current expansion is mainly rolling stock-based plus the Leeds-Manchester upgrade. More is needed, but this will need simplified procurement rules and an avoidance of projects going wrong so as to build a track record for future work.

All agree that funding for CP6 will be different, with Network Rail no longer pulling down debt. Scottish-style devolution would be welcomed, although it is recognised that Metro operation in the North and Midlands has already achieved this. Neither of these regions has seen major improvement to inter-city routes, maybe because the Network Rail situation restricts the freedom to act.