UK: Closer alignment of the objectives and incentives for train operators and infrastructure manager Network Rail is essential if the costs of running the British rail network are to be reduced, according to Sir Roy McNulty. Launching the final version of his Rail Value for Money Study in London on May 19, McNulty said the fragmented structure introduced at privatisation had introduced many barriers to efficiency.

Benchmarking against railways in France, Sweden, Switzerland and the Netherlands had revealed that costs per passenger-km were around 40% higher in Britain. Of this, he believes that savings of 30% are achievable.

McNulty recommends the formation of a Rail Delivery Group of senior industry leaders including Network Rail, passenger and freight train operating companies and major suppliers to overcome interface issues which add cost. A new Rail Systems Agency would deal with technical issues and standards, largely replacing the current Rail Safety & Standards Board.

Many of the recommendations can be taken forward by the rail industry, and review Deputy Chairman Ian Dobbs was 'encouraged' by the 'engagement' shown over the past 15 months. Other proposals will require government intervention, including suggestions that the regulation of passenger franchises should transfer from the Department for Transport to the Office of Rail Regulation. The government should also undertake a full review of the current fare structures to reduce confusion, eliminate anomalies, and improve management of capacity at peak times, but the net cost to passengers should be broadly neutral.

McNulty emphasised that there were no proposals for line closures, and he was keen to see average load factors increased rather than cuts in the frequency of services, suggesting that there was ample capacity to accommodate further growth without increasing costs.

Above all the review team emphasised the need for much greater clarity from the government on 'policy, objectives and strategy for the industry.

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