Fenix Signalling Ltd’s headquarters in Stratford upon Avon received a visit from local Conservative MP Nadhim Zahawi in April.
Staff at the turnkey signalling engineering and professional services consultancy were on-hand to brief Mr Zahawi, the Parliamentary Under Secretary of State at the Department for Education, regarding the company’s expansion plans and to highlight issues arising as a result of the delay between Network Rail’s control periods CP5 and CP6.
CP6 will see continued significant investment in a five-year period from 2019 with record expenditure of up to £48bn. Network Rail’s ambitious plan will further improve Britain’s railway to 2024. The plan will drive economic growth, jobs and housing by delivering a better railway for the millions of people who rely on it. The railway will be more reliable, more cost efficient, it will have more capacity, will build on its reputation as the safest railway in Europe and usher in the railway’s digital age.
The £48bn for CP6 compares to the current five-year budget of £38.5bn for CP5. However, nearly £3.9bn worth of improvements that were part of CP5 have been deferred due to lack of cash. The CP6 budget therefore includes financing for some projects that lapsed during CP5. Other major rail enhancements will require additional financing and be announced separately early next year.
The Office of Rail and Road (ORR) pointed out in its latest Annual efficiency and finance assessment of Network Rail that the efficiency of Network Rail’s core business activities has declined by 4.4% over the first three years of CP5, compared with the ORR’s assumption of a 13.7% improvement. The cost of not delivering as much efficiency as expected is estimated at £3.9bn, the same value as the deferred work.
Craig Purcell, Managing Director of Fenix Signalling Ltd said: “We were delighted to be able to welcome Nadhim Zahawi MP to our Stratford upon Avon HQ. We were able to discuss with him our growth plans for the next five years, which Mr Zahawi obviously has an interest in given that we are headquartered in his constituency. We shared with him information about our capabilities and experience in the provision of innovative signalling solutions and major project delivery and how we aim to work with an even wider range of clients as we continue our business development and expansion both in the UK and internationally.
“We also discussed the gap that exists between CP5 and CP6 and the issues this causes for rail industry businesses like ours. The volume of renewals will slow down as CP5 draws to close. Rail funding is a critical issue for the rail industry supply chain and the way the funding system works affects the supply chain’s ability to continue to build, maintain and improve the UK’s railways. Potentially, this can cause job losses. Mr Zawahi has pledged to support our efforts and has already helped us by putting us in touch with several organisations.”
CP5 will conclude in March 2019. Network Rail’s current plan for CP6 is subject to regulatory review and changes. The final plan will be published by the end of March 2019 following the ORR’s Final Determination for CP6, expected in October 2018.