ORR’s National rail review and Network Rail monitor for Q2 2007-08: preparing for the periodic review 2008, and continuing improvement in Network Rail’s performance

15 November 2007
ORR/32/07

The Office of Rail Regulation (ORR) today publishes its latest National rail review and Network Rail monitor covering the second quarter (broadly July to September) of 2007-08.

The second quarter review highlights the latest work on the periodic review; and articles on railway finances, Network Rail enhancement projects, a mystery shopper survey, and early results on how the new safety regulations are being implemented.

The monitor highlights how industry performance continues to improve, despite the challenges of summer floods, with the number of trains arriving on time standing at 88.7% (ahead of the industry target of 88.3%). Network Rail delay minutes are also running at a lower level than a year ago. However, performance on Network Rail’s western route remains poor, as delays were worse than the levels projected in the joint improvement plan agreed with First Great Western.

Bill Emery, ORR chief executive, said: “The second quarter has been dominated by Government decisions as part of our periodic review of the mainline railway outputs and access charges for the period April 2009 until March 2014. Recently we received the industry’s strategic business plan from Network Rail, and we are consulting widely on the plan. We will be making a preliminary assessment on the plan before Christmas, with a fuller assessment in February 2008.

“There continues to be plenty of positive news on the railway – more passengers, and continuing improvement in the reliability with more trains now arriving on time. However, there is still a lot of hard work that needs to be done, particularly by Network Rail. Problems on the western route continue – causing us serious concern. Also, there is evidence that Network Rail is beginning to get to grips with asset failures, but we consider it is too early to say that earlier difficulties have been overcome.”

Other issues covered include:

• Railway finances – an analysis of data from a number of sources revealing the full impact on the passenger of subsidies and premiums.
• Enhancement projects - welcoming proposals by Network Rail to reduce the time taken in the delivery of minor enhancement projects. There is a clear need for Network Rail to catch up on certain schemes.
• Mystery shopper survey on Southern railway – in March 2007, Passenger Focus commissioned a survey on the Southern network. Overall the findings were positive and ORR supports such surveys, believing there would be value in pursuing similar research with passengers of other TOCs.
• Implementation of the new safety regulations – the new regulations (ROGS) have been implemented progressively throughout the industry over the last twelve months. ORR has commissioned a three-year research programme to evaluate the effect of the new regulations and the first findings are positive.

The Network Rail monitor from Q2 (24 June to 15 September) 2007 shows:

Great Britain:

• Performance and delay minutes - the public performance measure (PPM) for Q2 was 88.7%, higher than the industry target of 88.3%. This is 1.3% higher than PPM for Q1 2006-07. Delay minutes were reduced by 5% in comparison to Q2 2006-07. Network Rail’s revised forecast for the year is 9.4 million minutes, which is worse than its business plan target of 9.1 million minutes, but better than the regulatory target of 9.8 million minutes.
• Safety – there was a slight increase in train accident risk between Q3 2006-07 and Q1 2007-08, mainly due to ground-slippage and poor rail adhesion caused by the heavy rains and flooding of the summer. However, the figure remains less than half of what it was in 2002.
• Infrastructure assets - for more than a year, ORR has been challenging Network Rail about the level of asset failures causing delays to services. Although improvement had stalled for the last year, this showed some signs of improvement in this quarter. The number of asset failures was 11% fewer than last year, although the improvement is not yet consistent across all asset types.
• Network Rail’s expenditure – Q2 expenditure was £150 million (10%) below budget, and year-to-date expenditure was £263 million (10%) below budget. Network Rail is forecasting to spend £309 million (5%) below budget.

Scotland:

• Performance and delay minutes - the public performance measure (PPM) for Q2 was 89.4%, which shows an improvement of 1.9% on Q2 2006-07, and is better than Britain as a whole. Network Rail is ahead of both the regulatory and business plan targets for 2007-08. Delay minutes are 22% better than target.
• Infrastructure assets – overall asset performance in Scotland has been similar to performance across the network as a whole, and Network Rail has been following similar steps to achieve an improvement. The number of incidents in Q2 was 8% better than the previous year, compared with an 11% improvement for the network as a whole.
• Expenditure - Q2 expenditure was £13 million (10%) lower than budget, and year-to-date expenditure was £35 million (14%) below budget.
  

Notes for editors

1. The National rail review is available on our website at: http://www.rail-reg.gov.uk/upload/pdf/343.pdf.
2. The Network Rail monitor is available on our website at: http://www.rail-reg.gov.uk/upload/pdf/344.pdf.

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ORR Press Office – 020 7282 2188/2007