Hendy Review might delay East West Rail by seven years

The East West Rail Consortium (EWRC) has responded with alarm to rumours that completion of the cross-country project could be delayed by up to seven years.

All rail enhancement schemes under the current control period (CP5) are being scrutinised by the ongoing Hendy Review, following government concerns about Network Rail’s under performance and over expenditure. EWC understands that draft recommendations have been made to NR chairman, Sir Peter Hendy, focusing on cost and deliverability, and that Phase Two of the Western Section is now expected to be completed in three, instead of two stages as originally planned.

That would set the schedule back from March 2019 to 2022 (for Bedford to Oxford); to 2024 (for Aylesbury to Milton Keynes); and to 2026 (for the Aylesbury to Princes Risborough) sections. (Phase One – from Bicester to Oxford – was partially completed in October and will be fully operational next year).

Delay will also set back electrification of the core Oxford to Bletchley section, also scheduled for March 2019 completion (albeit funded under the separate ‘electric spine’ project).

LTT approached Network Rail for a more detailed exposition but a spokesperson declined to comment until the review is completed towards the end of the month.

Of the top 20 committed enhancement projects, East West Rail recorded the greatest overspend by far during 2014/15 (the first year of CP5). NR’s regulatory financial statement (published in May) gives actual EWR expenditure in 2014/15 of £143m, which was £109m above ORR’s 2013 periodic review determination of £34m (i.e. the amount ORR assumed NR would spend during the year).

This figure compared to overspends of £77m on The Northern Hub and £58m on Thameslink – the next two biggest spenders – but on considerably higher expenditures of £165m and £500m respectively.

“The main reason for the increase in expenditure is due to acceleration of activity from future years. Network Rail’s internal plan for 2014/15 expected to deliver more of the programme in 2014/15 than ORR’s assumption,” says the statement, but it gives no further details.

The East West Consortium was set up in 1995 and represents 17 local authorities. The Western section got government go-ahead in Autumn 2011.  Local authorities have committed over £5m to the scheme so far, and have committed to a further £45m. (The Eastern section is complete, and the ‘missing’ Central section between Bedford and Cambridge needs reconstruction, and is a separate project for the future).

An EWC spokesperson informed LTT that representatives of the consortium are to meet with Sir Peter Hendy shortly to express their concerns.  LAs and the three local LEPs are particularly worried about the impact on jobs and housing any delay would bring:
“The East West Rail proposals are fundamental to the success of our Strategic Economic Plan which aims to support the creation of 6,800 new jobs”, said Alex Pratt, Chairman of Bucks Thames Valley LEP. “The Aylesbury Vale district area plans to accommodate in excess of 30,000 new properties, a figure which dwarfs the ambitions of many City regions. This growth is particularly dependent upon the delivery of the new train services between Milton Keynes, Aylesbury and Princes Risborough. Many of the 7000 plus members of our Business Growth Hub, Bucks Business First have cited limited infrastructure as the biggest barrier to their productivity growth and see East West Rail as the most critical new investment for our region.

“It would be an economic disaster if this project were to be delayed.”

685/Nov 15

 

 

 

 

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