Leading change in the rail industry
Transport Secretary’s speech at the 2016 annual conference of the Rail Delivery Group.
Opening remarks
Thank you.
And good afternoon everyone.
It’s a pleasure to be here - and to have this opportunity to address an expert rail audience.
20 years ago this Thursday, the 05.10 early morning service pulled out of Twickenham station on its way to London Waterloo.
As far as train journeys go, it was unremarkable.
But it was in fact a landmark in the history of the British railway.
The first scheduled service run by a private operator in this country for almost half a century.
Looking back, not even the most fervant advocates of privatisation could have predicted its impact on the railway.
20 years in which passengers have doubled.
Investment’s increased.
Costs come down.
And in which standards have improved to such a degree that we now have the safest railway in Europe.
Something we never take for granted.
And something we always have to guard and watch.
Continued progress
But as you’ve heard this morning, things are going to change even faster over the next 20 years.
We’re only at the start of a unprecedented construction and modernisation programme, which will make Britain the leading rail investor in the western world.
Who would have thought that a few decades ago.
And it’s in this Parliament when we really get cracking with that programme.
Finishing Crossrail.
Starting HS2.
Completing Northern Hub.
Getting rid of old train like Pacers.
And introducing new ones – like Intercity Express on the Great Western and East Coast lines.
All evidence of how we’re investing to transform journeys for passengers.
But building a better railway is not just about investment.
It’s also about changing poor public perceptions.
Being more transparent.
And treating passengers as valued customers, like the very best service providers do.
The challenge is to create a culture that’s relentlessly focused on the customer.
It’s also about controlling costs more effectively.
Delivering more for less.
Like industries across the economy were forced to do in one of the longest and deepest recessions in our history.
And it’s about joined up thinking.
The railway coming together.
Speeding up and improving long term planning.
Setting clear objectives.
And being accountable for achieving them.
The industry is at a stage in its evolution where there are huge opportunities to do all these things.
But it needs better leadership and direction.
And the Rail Delivery Group is absolutely fundamental to that process.
The Shaw Report may provide some answers.
But we need to face up to the fact that there may still be challenges ahead.
And we need to be ready to meet them.
Learning lessons
Some of these issues came to a head last year.
For example when we had to pause the electrification of the Midland Main Line and Transpennine.
But then we worked together, with particular credit going to Sir Peter Hendy and his team, to get Network Rail’s infrastructure programme up and running again.
Delivery of that full programme on time and on budget is crucially important.
Not just for rail users.
But for the industry itself.
This is about making the railway more professional and answerable.
If challenges crop up, then the industry must confront and tackle them.
My first job as Secretary of State was to sort out the West Coast franchise mess.
The first step was to accept responsibility on behalf of the department.
The next was to take swift action.
And 3 years on, franchising is in a much better place.
In fact it’s at the heart of improving our railway.
So the key objective now for us all I hope is to learn lessons, and make the railway more resilient.
That’s why we’re looking at regulation and structure.
Network Rail has a capability plan, which reflects the changes made to the enhancement programme.
And which will take into account feedback from Colette Bowe’s review, and the ORR.
We’re currently consulting on that.
And in the light of the Bowe Review, it’s also a timely chance to consider the duties of the ORR again, to make sure they’re appropriate for regulating Network Rail – so improvements can be made reliably.
We’ll consult with the industry again on options for structural change after the Shaw Report is published.
And we’ll provide clarity on our plans as early as possible.
Supply chain and skills
Improving resilience takes many forms. But there are 2 I’d like to highlight today (2 February 2016), which I believe are immensely important to Network Rail’s programme, and in which the Rail Delivery Group has a direct interest.
First, the supply chain.
Yesterday I attended the launch of the Rail Supply Group’s sector strategy, the first agreed plan for how the supply chain will grow as we modernise the railway.
I know the RDG has excellent links now with the Rail Supply Group and the wider supply chain.
And that relationship is going to get stronger as we progress.
Second, the skills challenge.
Training the workforce is the single biggest construction and engineering challenge of this age, with huge implications for the railway.
We need a new generation of rail engineers, designers and construction professionals.
And highly skilled people to operate the networks once they’re open.
That’s why last week we announced our transport skills strategy.
Led by Terry Morgan, chairman of Crossrail, the strategy sets out how we’ll provide 30,000 apprenticeships in roads and rail up to 2020, and I hope leave a legacy of skills for the next generation.
We’re also investing in new training centres like the National Training Academy for Rail and the National College for High Speed Rail as well.
And in 2018, to coincide with the finishing of Crossrail, we’re going to have a period of celebrating engineering, to excite a new generation of brilliant minds.
Franchises and ticketing
I’ve spoken mainly about the big rail issues today.
But we must also keep focused on the things that matter most to passengers in their daily journeys.
And one of the areas where’s there’s massive potential for improvement is ticketing.
Frankly, the process is still impossible to fathom out.
The railway is still light years behind other industries on this issue.
Though some good progress has been made.
For example on smart ticketing through the South East Flexible Ticketing programme.
What’s important is that we’ve now reached a point where future development can be led by the private sector.
Now we need to see more operators coming together.
Getting different IT systems to talk to each other.
Providing a seamless travel experience across boundaries.
That’s why we made smart ticketing an integral part of franchise competitions.
So we can expect to see some exciting proposals from bidders in the months and years ahead - starting with the competition for Southwestern and the West Midlands in the spring.
We cannot claim to have truly modernised our railway if we don’t also transform ticketing.
And I know that’s something the Rail Delivery Group is working on.
Conclusion
So to sum up.
Two decades since the railway entered a new era of enterprise and competition - yet also 2 decades in which rising demand has tested the capacity and resources of the industry like never before – we are now in a position to complete the job of modernising the railway.
For an industry that was in decline for so long, our objective is to make Britain’s railway the equal of any in the world.
It will take several Parliaments to achieve.
But it will be this Parliament.
And this period of opportunity.
When the future course of the railway is irreversibly set.
So now is the time to show the industry is changing.
Controlling costs.
Putting customers first.
Conquering problems every day.
Uniting as one industry, but serving the public in different areas.
In partnership with government. Inspired by the leadership of the Rail Delivery Group.
Grasping the opportunity together.
Thank you.