Severe planning and budgeting failures in Network Rail’s current five year investment programme have been highlighted in a new report by the House of Commons’ Public Accounts Committee.

 

It has concluded that the rail operator, Department for Transport and the Office of Rail & Road agreed an unrealistic programme of investments for 2014-2019.

 

Its report points particularly to “staggering and unacceptable” cost increases in the project to electrify the Great Western Main Line from London to Cardiff, which is expected to cost up to £1.2Bn more than the £1.6Bn estimated a year ago.

 

It adds that there is too much uncertainty on costs and delivery dates for the electrification of the TransPennine route and the Midland Main Line, and warns that more projects could be delayed in order to balance Network Rail’s budget.

 

Committee chair Meg Hillier MP said: “Network Rail has lost its grip on managing large infrastructure projects. The result is a twofold blow to taxpayers: delays in the delivery of promised improvements, and a vastly bigger bill for delivering them.

 

“Our inquiry has found that the agreed work could never have been delivered within the agreed budget and timeframe. Passengers and the public are paying a heavy price and we must question whether the ORR is fit for purpose.”

 

The Committee has called for a fundamental review of the ORR’s role and effectiveness. It has also urged Government to publish a revised and re-costed programme of electrification improvements.

 

A report by Network Rail chairman Sir Peter Hendy on the deliverability of the current investment plan is due to be published soon.

 

A Network Rail spokesperson said: “It is clear that we, as an industry, have been overly ambitious about what could be accomplished with the funds and resources available.

 

“We have now made significant changes to the way we plan and deliver our investment programme, which will see schemes progress only once they are sufficiently developed that a reliable cost estimate can be established.”

 

A spokesperson for the ORR said: “With the changes to Network Rail’s ownership and finances since it became a public sector company, ORR agrees that a review of its own role in major projects is appropriate.”