Rail replacement scheme postponed by government

8 July 2010

8 July 2010 | Lindsay Clark

The UK government is to delay a £7.5 billion passenger train procurement programme until its October spending review.

Transport minister Philip Hammond said it would be irresponsible to go ahead with the Intercity Express Programme – intended to replace the UK’s aging Intercity 125 and 225 fleet – until the spending review is complete. This is despite engineering consortium Agility Trains having been appointed preferred bidder in February.

Hammond was responding to a report by Sir Andrew Foster, former head of the Audit Commission, examining the programme’s value for money. Although Foster found it was within the government’s value threshold, he concluded that other possible options had not been fully assessed.

Foster also responded to criticism of the delayed procurement process. The need for commercial confidentiality had resulted in insufficient communication between the Department for Transport (DfT) and the key stakeholders, he said. Despite involving the rail industry in the procurement process, a sense of disengagement developed, which could have been avoided.

Hammond said the government would consult the industry on the future of high-speed rail, including the options for rail franchises, before announcing its decision on the Intercity Express Programme. The government is under pressure to cut spending in response to the public sector deficit, and the DfT budget could be slashed by a quarter.

Agility Trains, the preferred-bidder consortium lead by Hitachi, said in a statement: “Agility Trains has confidence in the performance of our product as shown by our readiness to offer not only trains, but a guaranteed service level to our customers. The proposal provides a step-change in capacity with relatively minor expenditure on infrastructure, as well as the opportunity to bring a major manufacturing facility and state of the art technology to the UK. 

“We have expressed our commitment to continue working with the Department for Transport to respond to the points in the report, and to find an affordable solution which meets the government’s objectives.”

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