Peter Hendy RIA Innovation Conference 2022

UK: The industry will not back away from its modernisation and cost reduction drive despite the threat of strike action this summer, Network Rail Chair Sir Peter Hendy told the Railway Industry Association Innovation Conference in Nottingham on April 27.

More than 40 000 RMT members at Network Rail and train operating companies are to be balloted in what the union has called ‘potentially the biggest rail strike in modern history’.

However, Hendy said that he and the emerging Great British Railways leadership group under Transition Team lead Andrew Haines were clear that cost reduction and productivity improvements were essential.

‘I hope we can avoid strikes, and it will be a real shame if they go ahead’, Hendy said. He urged delegates to remember that the Treasury had ‘pumped in £18bn’ during the pandemic to keep the railways operating. Unlike other industries such as aviation or long distance coaches, the rail maintenance and operations sectors had made almost no use of the government furlough scheme.

Since the pandemic, the economic climate had become ‘difficult’ and Hendy felt that mounting pressure to boost spending in sectors like defence could also affect the government’s willingness to spend on rail.

Reflecting on his role as Deputy Chair of GBRTT, he added that ‘every meeting’ he had with ministers included a reference to the ‘sheer expense’ of the rail sector.

Hendy suggested that the railway needed to remind itself of the reasons for its own existence, and of the reasons why government continues to fund it. He pointed to five factors as ‘the reasons why we all do what we do’: driving economic growth, connectivity, housing development, sustainability and social cohesion.

Looking ahead to the formation of GBR, he said political intervention in the rail sector could not be eliminated. ‘People often say politicians should stop meddling, but they have the right to meddle because they are providing the funding.’

He reflected that crises such as the May 2018 timetable ‘fiasco’ had been largely caused by the rail sector itself, ‘and we rightly still have a lot of hard questions to answer. For one thing, we are now running 90% of the trains for 70% of the [pre-pandemic] passengers, and it’s right that government is asking us to address that.’

WISP on the way

Looking back to his decade leading Transport for London, Hendy suggested the main line railway still lacked clear strategic planning processes comparable to TfL’s annual business plans.

To address this, GBRTT has called for evidence to support the development of a 30-year Whole Industry Strategic Plan which would to enable the government to set a clear long-term direction for the railway.

‘We need to be much clearer in setting out what the railway can do for the country, and WISP will do that’, Hendy said.

A priority for GBR would be to undertake much more rigorous planning of projects and their strategic advantages, he explained, adding that WISP would allow government to see ‘a list’ of options that are well developed.

Noting the relative lack of prior work on some of the proposals contained in last year’s Integrated Rail Plan, he insisted that ‘the country deserves better than under-prepared business cases’.

More positively, he anticipated that in the medium term train operating businesses would again be ‘incentivised to go for growth’ as the post-pandemic demand picture starts to become clearer.

Echoing comments on April 26 by Williams-Shapps Review Chair Keith Williams, Hendy backed GBR’s commitment to open data. ‘The railway can and should be much more honest about how it’s performing. Data can also tell us how people are travelling, at what price and why.’

Insisting that innovators across the supply chain must have senior level access to the new arm’s length body, he emphasised that GBR ‘cannot be another public sector monolith’.