Newspaper article Manchester Evening News

Network Rail Must Sell Assets to Fund Route Upgrades ; New Report Also Reveals That Bill to Taxpayers Will Rise to Pounds 700m to Build The'bulk'of Its Planned Projects

Newspaper article Manchester Evening News

Network Rail Must Sell Assets to Fund Route Upgrades ; New Report Also Reveals That Bill to Taxpayers Will Rise to Pounds 700m to Build The'bulk'of Its Planned Projects

Article excerpt

NETWORK Rail will have to sell off Pounds 1.8bn of shops and depots to fund major projects like the Manchester-Leeds electrification.

The company will also have to increase borrowing from the taxpayer to Pounds 700m to build 'the bulk' of its promised projects.

The plan is outlined in a report written by Sir Peter Hendy, Network Rail's new chairman.

It admits 'poor cost estimating' and 'inadequate planning' - particularly around electrification.

After the report was released on the same day as the Chancellor's Autumn Statement, MPs have blasted the 'cynical timing' and called for transport ministers to take their share of the blame.

The Pounds 700m loan, combined with flogging assets, would raise the Pounds 2.5bn needed for 'the bulk' of the projects, the report says. But there would be 'implications for the future funding of the railway' - in part due to a reduction in rental income.

Sir Peter was brought on board after Network Rail lost control of projects, with costs spiralling and unrealistic deadlines.

Bungled schemes included the TransPennine electrification, which was 'paused' after an original budget of Pounds 260m escalated to what experts claim could have been Pounds 600m.

Transport Secretary Patrick McLoughlin announced it was back on track last month following an M.E.N. campaign - and there is now a 2022/23 completion date.

But the cost has not been revealed.

The report may also raise fears over the north's already limited rolling stock - with a suggested solution of 'rephrasing' the portfolio to meet a limited budget. This could mean there would be too few electric trains to run on the new tracks.

Lilian Greenwood MP, Labour's Shadow Transport Secretary, said: "Ministers are cynically trying to hide bad news by publishing this report late on the day of the Comprehensive Spending Review.

"It's an insult to taxpayers that incompetent planning has created a Pounds 2. …

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