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The time has come for city regions to run the railways

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Mark Carne, the chief executive of Network Rail, this week said he believes that local authorities, businesses and train operators should in future make greater contributions to rail developments. He wants the economic beneficiaries of new schemes to help pay for them. 

This intervention came a few days after Mr Carne and Network Rail had been subjected to the wrath of the Public Accounts Committee, which had expressed shock that the costs of upgrading the Great Western line had jumped from £874m in January 2013 to the latest estimate of £2.5-£2.8bn. That revelation comes on top of a number of other failures by Network Rail and, by implication, its regulator the Office of Rail and Road.

Until and unless Network Rail can get a grip on its finances and project management, local government should be very careful about handing over too much of its money.  A council or city region considering a major property development to help to pay for a new rail line should, on the basis of recent rail performance, be very wary of the possibility the project would run over-budget or worse.

Indeed, the back-to-back problems which have beset Network Rail point to a more radical reform which would have the benefit of aligning decisions about local or city regional planning with those of managing the railway. Why not transfer the control of rail infrastructure in city regions from Network Rail to the local transport authority? Such a reform would go with the grain of the chancellor’s devolutionary policies.

London Underground, as an existing local government-based transport operator, has performed far better than Network Rail. The government has recently parachuted Transport for London’s commissioner, Sir Peter Hendy, into Network Rail in an attempt to get a grip of the national rail infrastructure. London is a prototype for devolution of commuter rail systems to city regions.

Mr Carne is right in making the case for a closer link between investment decisions and the construction of new or improved railways. What is less clear is that Network Rail would be the best people to handle the rail part of any such projects. The time has come for city regions to run the railways.

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