Speech for Railtex exhibition
Discussing investment, growth and opportunity in the rail industry.
[Minister is introduced by Andy Milne, editor of Rail Staff magazine.]
Opening remarks
Thank you Andy.
And thank you ladies and gentlemen.
It’s a pleasure to be here for the opening morning of this year’s Railtex.
There is no better place to gauge the confidence and optimism of an industry than a trade show like this.
And with more than 400 exhibitors here this week…
From large train manufacturers to small scale engineering and technology companies…
I think Railtex 2013 is evidence of a thriving rail industry in this country.
Our railway has already seen passenger journeys double since privatisation, while freight business has grown by 60%.
But the future outlook is even brighter…
Because after decades of underinvestment, the railway is finally getting the funding it needs to grow and modernise.
Investment and growth
The truth is since the coming of the motorways more than 50 years ago, our transport infrastructure has fallen behind that of our competitors.
Even when money was plentiful, successive governments of both political persuasions neglected the network.
Between 2000 and 2007, for example, the UK was the lowest infrastructure investor of all the OECD countries.
But this government is changing all that.
Network Rail plans to spend £37 billion to run and expand the railway between 2014 and 2019.
Of that, the government is investing over £9 billion to deliver major improvements across the country.
This would be a considerable sum – even if we had not inherited a record public deficit.
But in the current climate, it’s an unprecedented commitment to the future of rail in this country.
A future that will deliver Crossrail and Thameslink…
850 miles of electrification…
The completed Northern Hub…
The £4.9 billion Inter City Express Programme…
And £900 million of flexible funding for smaller schemes.
By the end of the decade, these measures will result in an extra 140,000 seats on trains at peak times.
This is real investment.
Going straight into the network.
Providing the fastest improvements for passengers and businesses.
Opportunities/global
But money alone won’t build the modern, efficient, cost effective railway we all want to see.
It will also depend on how government and industry work together.
Funding may create opportunities.
But it’s the vision and innovation of your businesses that turn those opportunities into success.
I’ve already had a fascinating tour this morning.
You get a real snapshot of the industry…
From some of the world’s foremost train manufacturers like Siemens and Hitachi….
To major suppliers like ABB, Invensys and Telent…
The range of exhibitors and technologies from home and abroad is very impressive.
It emphasises the increasingly global nature of the industry, and the importance of UK-based companies competing internationally.
During a recent visit to Japan, I had an interesting talk with Hitachi, who hope in the long term that they might be able to sell UK-built rolling stock to European markets.
This is something our car industry does very successfully.
The Nissan plant in Sunderland, for example, exports cars all over the world – including to Japan.
We should aspire as an industry to compete for more export business, both in Europe and further afield.
That’s something we’re working on at the rail round table, which brings together ministers from the DfT and BIS, and the rail supply chain…..
Government working hand in hand with industry to raise the profile of UK-based suppliers and manufacturers in international markets.
HS2
And among the biggest growth sectors globally is high speed rail.
We are now well on the way to delivering a new high speed railway for Britain.
Earlier this year we announced Phase 2 of the project – routes north of Birmingham linking Manchester, the East Midlands, South Yorkshire and Leeds.
With this announcement, I think the message has really got through…
That HS2 isn’t just about faster journeys.
It’s about providing extra capacity on an ageing rail network.
It’s about better services for passengers
It’s about changing our economic geography…
Connecting cities…
Linking people with jobs…
Bringing suppliers closer to manufacturers, and manufacturers closer to markets.
Taking pressure off our roads…
And freeing up space on the rest of the railway.
But high speed will also be a tremendous boost to the UK rail industry.
Phased construction will support a robust domestic supply chain – creating thousands of jobs, and ultimately giving UK businesses the chance to export their products and know-how to markets around the world.
Franchising
We’ve also moved quickly to get the rail franchising programme back up and running…
And to establish a robust and open system for future franchise competitions.
We have transferred all our rail activities into one group, accountable to a single director general, and we’ve appointed a director responsible for rail franchising.
We’ve also taken steps towards more transparent franchising.
The department recently published the Franchising procurement process map, which sets out how we will procure future franchises, and provides precisely the sort of transparency the market is looking for.
By involving rail operators at every stage, we are consigning the old, closed bidding process to history.
We took another big step forward in March when we published our entire future rail franchising schedule.
This will help operators to plan ahead.
Franchise competitions will be staggered so they are more manageable for both government and industry.
In fact we’re holding a special event on May 22 to discuss the new franchising programme.
We welcome interest from any ambitious, dynamic companies who want to help our railway prosper.
Challenges/innovation
I’ve spoken today about investment, growth and opportunity.
But to maximise the benefits of these opportunities, the rail industry also faces some tough challenges.…
For example, how can we squeeze more capacity out of the existing infrastructure as demand rises?
How can we meet passenger expectations – by improving the quality of service and punctuality?
And how can we reduce industry costs to make the railway more affordable for taxpayers, passengers and freight customers?
I welcome the fact that the industry has started to respond to these challenges.
In December, the rail technical strategy was published, setting out a 30-year vision of how technology can improve the railway. It’s a good example of industry groups and companies coming together to share ideas.
The industry’s new enabling innovation team (EIT) has been formed to demonstrate how new technologies and new business models could transform the industry.
We’re providing £13 million this year to bridge the gap between research and practical implementation.
A key objective for the team is to build on the strengths of the UK supply chain so companies are able to compete at home and abroad.
It’s currently inviting radical new ideas for train design, and will launch a competition in May aimed at improving the customer experience.
I’d encourage everyone here at Railtex to find out more about the EIT and take advantage of the expertise and funding it offers.
Skills
But to compete effectively, the industry needs the right people with the right skills.
And – to be frank – this is an area where it faces real challenges.
Recent analysis has highlighted emerging skills shortages because of an ageing workforce…
And because existing staff are unqualified to operate increasingly sophisticated trains and control systems.
So there’s a real and urgent need to attract more young, bright people into the rail industry…
To train the existing workforce so they’re ready for new technologies such as ERTMS…
And to provide better training facilities.
Progress is being made.
Only last month, the National Skills Academy for Rail Engineering launched its Skills ID initiative. This is an online system to record an individual’s qualifications, competences and skills.
It will be fully transportable from one employer to the next.
Not only will it help individuals keep track of their development, it will also help the wider industry with skills forecasting and training. We are working closely with the industry on the rail skills agenda, in particular through the ministerial rail round table chaired by Transport Secretary Patrick McLoughlin and his opposite number in BIS, Vince Cable.
I’d also like to add my support for the dedicated careers event being held here this week.
Called Rail – the Next Generation, Railtex has joined with various companies and industry groups to give youngsters, students and graduates a real insight into rail careers.
Offering tours of exhibition, seminars, demonstrations of technical equipment, and valuable advice on jobs, it’s a terrific way to enthuse a future generation of rail professionals.
We all know this is an exciting industry to work in - with real prospects for people who are creative and work hard.
But what we have to get better at is convincing the younger generation of this fact.
And that’s precisely what this initiative will do.
So I congratulate everyone involved.
Conclusion
To sum up then, this is a time of historic opportunity for the railway.
The government sees transport as one of the key drivers of growth in our economy, and right at the heart of our transport vision is the regeneration of our railway.
But it’s also a time of historic challenge and change.
To realise the true potential of our railway, we need investment and reform…
We need modernisation of the current network and to build HS2…
We need to attract youngsters and improve the skills of existing staff.
There’s a huge amount to do.
But I’m confident we will succeed as long as we work together.
Thank you for listening.
And can I wish all of you a very successful show.