Rail finance and the ‘northern powerhouse’

http://www.theguardian.com/uk-news/2015/jun/30/rail-finance-and-the-northern-powerhouse

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Your editorial (Rail investment has been put on hold in the Great Northern power cut, 26 June) shows a lack of understanding about how the railway’s finances work. Train operators contribute a great deal to investment in the rail network and the model for running our railway offers a fair deal to taxpayers.

Britain’s railway now carries almost twice as many passengers as when franchising was introduced, thanks to investment by both the private and public sectors. This phenomenal growth has contributed to a 400% increase in the amount of money paid back by train companies to the government – money which is reinvested in better services. At the same time, operating margins of train companies are around 3%, a fifth lower than in 1997-98.

We know how much people and businesses rely on rail and that some will be disappointed by last week’s announcement that certain improvements will be delayed. The majority of proposed enhancements in Network Rail’s programme will still go ahead and the industry, government and regulator will learn from this situation to ensure we do better in delivering the future improvements the railway needs.Michael RobertsDirector general, Rail Delivery Group

• “Great Northern power cut”? Northern powerhouse to northern con trick is what you really mean. There is no powerhouse and never will be. As we trundled past on our Pacer trains to Manchester Piccadilly we looked longingly, for years, at the “L’Eurostar est ici” sign on the railway sheds at Longsight, till it was taken down. Now as our Pacer chugs past we await its replacement, “Thomas the Tank Engine, Hogwarts Express and HS3 coming soon”, then we can start dreaming again. Are we really, really gullible up north?Martin BrayfordHale, Cheshire

• Simon Jenkins is wrong to claim that the £38.5bn rail investment programme is on hold or that it is a “victim” of HS2 (Comment is free, 26 June).

The truth is that successive governments failed to invest the sums necessary in our rail network, much of which dates back to the Victorian age. As a result, parts of the network are full.

Related: HS2 – why it’s time to pull the plug on the fantasy | Letters

So when we faced a choice between building the infrastructure our country needs, or our railway becoming a brake on growth and opportunity, this government chose to invest for the future through the biggest programme of railway modernisation since the Victorians, as well as building HS2. Both are vital to secure this country’s economic growth and we will deliver them.

It has become clear that Network Rail’s performance on this upgrade has not been good enough. That is why the transport secretary has taken action to reset the programme and get it back on track. Some elements will be paused, but the programme is not, as Mr Jenkins suggests, entirely on hold. The new chair of NR, Sir Peter Hendy – who has a proven record of delivering on major transport challenges – will report directly to the transport secretary on how this will be addressed.

Not one penny of this money is going to be taken to pay for HS2, as some have suggested. We remain hugely ambitious and that is why the budget for both projects remains intact.Andrew Jones MPTransport minister