Network Rail looks to save money by ditching EU standards

Fonte: Financial Times

Network Rail is considering using Brexit to cut costs by abandoning EU regulations as it struggles with a funding crisis.

The organisation, which owns and manages the UK’s rail infrastructure, said: “We want the best of both worlds — trade that enables us to realise the benefits of low-cost (standardised) supplied products together with the freedom to not apply Euro standards where they drive unnecessary cost into the UK railway.”

The rules in question include specifying a common track width on all lines and uniform platform heights. All EU legislation will be copied into UK law before Brexit.

Network Rail did not say how much it might save by replacing the EU standards.

Mark Phillips, chief executive of the Rail Safety and Standards Board, an industry body, said it would be a mistake for Network Rail to discard EU rules too quickly.

“On a case-by-case basis it might all seem logical but from a rolling stock point of view, to move it from one place to another, it might make sense to have this uniform approach,” Mr Phillips said.

He suggested that it could reduce the value of trains because they would be able to operate on fewer lines, and new freedoms had to be used “in a controlled way”.

Network Rail is a member of the RSSB, along with train operating companies, freight companies and industry suppliers. Mr Phillips said this disagreement with a member presented “challenges to resolve”.

Andrew Haines, its new chief executive who started earlier this month, faces a funding problem. The regulator, the Office of Rail and Road, has warned that Network Rail will probably reach its debt ceiling in 2018-19. It said that Network Rail’s debt had increased by £5.6bn to £50.4bn in 2017-18 and it would probably “use all of its available borrowing” in the next year, namely the £4.1bn left of a £30.9bn loan facility with the DfT.

Mr Phillips said that Brexit might also act as a catalyst for reforming the rail franchise system, which has been criticised after the East Coast franchise failed in May. “We must be approaching a time where the Department for Transport will be looking at how you improve on what we’ve got. Brexit does give an opportunity to do that,” he said.

While the RSSB was “agnostic” on the nationalisation of the railways, a policy of the opposition Labour party, since it would have to come up with safety standards regardless, Mr Phillips did suggest “breaking [the network] up into more regional routes that have long-term concessions” of 30-50 years could attract private equity investors.

Mr Phillips had harsh words for the rail industry’s lack of investment in research and development. Compared to automotive and aviation investment in new battery technology and artificial intelligence, he said the UK rail industry was “miles and miles behind” and had become “welfare-dependent” on public funding.

He said the structure of the industry, with its five- to seven-year franchises, discouraged long-term planning and investment: “People are only interested in the here and now. They’re not inclined to invest for the long term because they might not be there in the long term.”

Luisa Moisio, director of research and development at the RSSB, called the industry’s structural incentives “quite perverse”, pointing to the train operators’ refusal to adopt technology which would improve braking in the event of leaves on the line because they received payments from Network Rail for such delays.

The Rail Delivery Group, which represents train operating companies and Network Rail, said: “We are seeing the largest investment in rail for a generation with billions of pounds coming from the private sector helping to fund the industry’s plan to change and improve for the benefit of customers, communities and economy.”