This article is part of a series in which DLA Piper professionals define what the Northern Powerhouse means to them, and how to deliver the regeneration of the Northern economy. The author was part of a forum that contributed to an article in Super North, a monthly supplement produced by The Times and sponsored by DLA Piper.
The pause in electrification of the Trans Pennine line between Manchester and Leeds announced by the Secretary of State for Transport on 25 June has been described as a “body blow” to the Northern Powerhouse. However, the reasons given for the pause also support the ideas behind the Northern Powerhouse concept - the need for delivery of transport improvements where strategic direction and control rests with democratically accountable bodies in the North of England.
It is clear that Network Rail’s investment programme has cost more and taken longer than expected. The reasons given for that include the need to strengthen supply chains, increase construction rates and obtain planning permissions faster from local authorities. The impact of these, and other, factors has been an increase in the cost and timing of upgrades and enhancements. The potential for delays is not surprising - whilst Network Rail has better knowledge of its asset base than it once did, upgrading an operational rail network originally built in the 1800s (whilst it is operating at capacity) is not an easy task, and will inevitably throw up risks and surprises that can cause construction delay or cost overrun.
Achieving greater cost and time certainty is not, however, a problem which is impossible to solve.
Complex and major rail projects, including ones interfacing with existing infrastructure , are capable of being delivered within a time and cost envelope, as, for example, Crossrail is currently demonstrating. Where there is the risk of delay or cost overrun, value for money principles suggest that such risk should not simply be borne by the public sector. To avoid this does, however, require risks associated with the project be properly and robustly identified in advance. This allows for contractual and operational structures to be put in place to ensure that those risks are effectively managed by the person best placed to manage them. This typically works best in a Public Private Partnership context, where there is a strong and effective public authority managing the contract.
The appointment of Sir Peter Hendy as the new chairman of Network Rail reflects this. Transport for London led by Mr Hendy has shown clear focus, and a good track- record for delivery of public transport within the capital. TfL has had clear political support from mayors on both sides of the political spectrum, and sufficient funding to deliver meaningful transport improvements. In recent years this has led to significant changes in delivery of rail, light rail and bus services as well as highway developments within London, and whilst unexpected issues are always likely to arise in delivery of new infrastructure, TfL has been well-placed to manage that, including ensuring that an integrated transport network can be used to minimise the impact on passengers, if things do go wrong.
Past experience of major construction and operational projects in the North, such as the current construction of the Mersey Gateway crossing or the devolution of control over Merseyrail services to Merseytravel shows that major transport and rail projects can similarly be effectively delivered by strong local government working in effective partnership with central government. The improvement in performance on Merseyrail following the letting of a locally run concession in 2003 arguably demonstrates the benefit of this approach quite clearly.
This pause in northern electrification therefore offers a further argument for appropriate devolution of transport delivery powers (and funding) to properly empowered authorities in the North, working in effective partnerships with central government, train operators, Network Rail, local planning authorities and other stakeholders. As with Transport for London, a clear organisational focus on delivery of specified projects, with the political focus being on delivery of those same projects will help ensure that they are given the correct priority. It should enable more effective engagement with other local stakeholders, including planning authorities, to assist in managing those risks which are most effectively dealt with at a local government level.
Rather than blame central government or Network Rail for delay in delivery, this should be viewed as an opportunity to demonstrate why locally led delivery of major rail and other transport projects can be an effective way to deliver the Northern Powerhouse.