ORR strengthens Network Rail's network licence

1 April 2009
ORR/10/09

The Office of Rail Regulation (ORR) has today made changes to Network Rail’s network licence aimed at strengthening and clarifying its obligations.

The changes emphasise Network Rail’s vital roles in industry planning, capacity allocation, asset management and timetabling.  Other changes include widening its obligation to treat stakeholders appropriately and to make sure the financial conditions in the licence are fit for purpose for the new control period, which starts today.

Michael Lee, ORR director of access, planning and performance, said:
“The changes we have made to the licence give Network Rail appropriate flexibility about how to deliver all of its high level obligations efficiently and to play its full part in the future success of the industry.  At the same time the licence enables us to hold Network Rail to account and intervene where we believe our action is necessary and will have the most benefit to Network Rail’s customers, funders and other stakeholders.”

ORR has made these changes after a wide-ranging 3 month consultation in 2008, and a shorter statutory consultation that ended in February 2009. Network Rail has agreed to the changes.

ORR is also publishing new guidelines for the development and maintenance of route utilisation strategies (RUSs) following consultation with the industry. These reflect the changes ORR has made to the licence, and will help RUSs play an increasingly important role in the planning of the industry.

Notes for editors

  1. These modifications are made under section 12 of the Railways Act 1993 with the licence holder’s consent. 
  2. The obligations in Network Rail’s network licence form a vital part of the framework for the company’s accountability. As the industry safety and economic regulator, we must ensure that the obligations and the way they stimulate the company to behave complement the other aspects of the framework – contracts, general legal obligations, outputs specified in periodic reviews, incentives, the financial framework, our enforcement policies and the company’s corporate governance.
  3. A key obligation in the modified licence is the purpose and general duty in condition 1.  This is sufficiently broad to encompass all of Network Rail’s network management activities. However, we believe it is helpful to emphasise some areas because of their importance for the new control period. These are obligations relating to planning, capacity allocation, asset management and timetabling. In delivering these specific obligations Network Rail will still need to ensure it achieves the overall purpose of the core condition. 
  4. The formal modification notice can be found on our website at: http://www.rail-reg.gov.uk/upload/pdf/394.pdf, and the consultation documents and, responses received can be found at: http://www.rail-reg.gov.uk/server/show/ConWebDoc.6847

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