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Monday, February 17, 2025

DfT publishes funding plans for Control Period 7

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The Department for Transport (DfT) has published the High-Level Output Specification (HLOS) and Statement of Funds Available (SoFA) for the railway in England and Wales for April 2024 to March 2029, Control Period 7 (CP7).

This commits to £44 billion of spending through Network Rail over the five-year period. A direct comparison with the previous five-year funding settlement (CP6) cannot be made because of differences in what is included. However, this new funding settlement appears to allow for a small increase in expenditure on Operations, Maintenance and Renewals (OMR) of the railway, in real terms. 

The HLOS recognises the importance of a resilient and productive supply chain that invests in skills and innovation. The Secretary of State has stated an expectation that Network Rail must work collaboratively with the supply chain and exercise its role as an effective and engaged client, demonstrating a commitment to being ‘open for business’.

Transport Secretary Mark Harper said: “The high-level output specification makes it clear that the government will press ahead with rail reform, addressing the challenges facing the sector, such as fragmentation and outdated working practices, with a strong continued focus on operations, maintenance and renewal. This strong continued focus is important in supporting a safe, efficient and reliable railway for passengers and freight customers.

“The government now expects Network Rail to develop detailed plans to deliver on these objectives, working closely with its customers. These will then be subject to strong and effective scrutiny by the Office of Rail and Road, as independent regulator, to develop robust, credible, value for money plans for the next control period.”

Commenting on the SoFA and HLOS, Darren Caplan, Railway Industry Association (RIA) Chief Executive, said: “With passenger numbers reaching as high as 99% of pre-Covid levels, as they did on Friday 18 November, it is clear the national railway will need this investment to meet both current and future demand.

“Nevertheless, at a time of significant inflation it is unlikely the funding settlement will cover all the investment needed. This makes it all the more essential to recognise the role the supply sector can play. We therefore welcome the commitment in the HLOS for Network Rail to work collaboratively with the supply chain, a consistent ask of RIA and our members in recent years.

“To ensure suppliers can help build world-class rail as cost-effectively as possible, it is essential that along with appropriate levels of funding they are given the certainty and visibility of the work pipeline that they need. This helps rail businesses plan for the people, skills and equipment they need to deliver and get best value for taxpayers.

The full policy paper can be found here.

Image credit: Gov.UK

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