First Special Report

The Welsh Affairs Committee published its First Report of Session 2017–19, The cancellation of rail electrification in South Wales, as HC 403 on 21 May 2018. The Government’s response was received on 23 July 2018 and is appended to this report.

Appendix: Government Response

Overview

The Government welcomes this report from the Welsh Affairs Committee, which sets out its findings into the decision to cancel rail electrification in South Wales.

This Government supports the Committee’s desire to see close working between the UK, Welsh Government and Network Rail to deliver improved services in South Wales.

Government is confident that its decision not to progress with electrification between Cardiff and Swansea is the correct one. Electrification provides no significant journey time saving between Cardiff and Swansea.

As per the recommendations from the NAO, we continually assess the investment decisions in our programme of railway upgrades, to deliver passenger benefits in the best way possible and give both passengers and taxpayers maximum value.

Improvements should be led by the needs that they are fulfilling rather than the methods by which they propose to fulfil them. New bi-mode train technology offers seamless transfer from diesel power to electric that is undetectable to passengers, providing the passenger benefits previously envisaged through electrification without the disruptive works.

Passengers in South Wales, including those in Swansea, are already benefitting from the added capacity of the new state of the art Intercity Express Trains providing them with a better, more comfortable journey. Once the whole fleet is introduced and electrification to Cardiff is complete journey times with the new timetable between Swansea, Cardiff and London will further improve.

We have taken clear steps over the last few years to strengthen the approach to planning and delivering rail enhancements. The Memorandum of Understanding between the Department for Transport and Network Rail, published in March 2016, set out our joint commitment to new working practices and their governance to ensure we better deliver improvements for passengers.

The ‘Rail network enhancements pipeline’ (RNEP), published in March 2018, sets out a new approach for rail proposals that require Government funding. This approach creates a rolling programme of investment, focused on outcomes that provide benefits for passengers, freight users and the economy and moving government investment in enhancements away from a rigid five year cycle.

Responses to recommendations

The decision to cancel electrification

Recommendation 1, paragraph 19, page 9

We recommend that the Government commit to reviewing the effectiveness of the enhancements pipeline approach within 12 months. We also encourage the National Audit Office to examine how the new process is operating.

The Government agrees in principle with this recommendation.

The Government will subject the portfolio and enhancements pipeline approach to review at appropriate points, and we are considering the best way to ensure regular review takes place, including from the Infrastructure Projects Authority and Office of Rail and Road. This could be extended to the NAO if it wished.

The enhancements pipeline approach is itself set up in such a way that the portfolio will be under regular review to function effectively.

All of that said, it is the Government’s view that to review the approach after 12 months is premature for a substantive and meaningful review as the time at which the review took place would only be one month into the start of the next Control Period – CP6. The Government intends to undertake a review after the first complete year of CP6 (April 2020).

Bi-mode trains

Recommendation 2, paragraph 38, page 14

We recommend that the UK Government and the rail industry carefully monitor the emissions from the Intercity Express trains on the route between Cardiff and Swansea, and publish the results on a six-monthly basis.

The Government agrees in principle with this recommendation and will ask the rail industry to identify an appropriate monitoring and reporting method.

It is important to note that particulate emissions are expected to be ten times lower for the new Intercity Express trains compared to the Intercity 125s (Class 43s) that they replace.

The Office for Rail and Road reports on actual energy consumption, including total traction electricity (kWh) and diesel usage (litres), in their Annual Statistical Release on rail infrastructure, assets and environmental. Actual energy data is converted into CO2e only. Energy consumption is not currently disaggregated at train operator or route section.

Recommendation 3, paragraph 39, page 14

Using the results of this monitoring, the UK Government and the industry should identify ways in which the emissions from the Intercity Express trains can be reduced further. We would expect to see clear evidence of emissions being reduced. The UK Government should also use the results of its monitoring to inform its future strategy on the use of diesel. It should explore whether, if diesel cars and vans and diesel-only trains are to be phased out by 2040, there is also a case for ending the use of diesel engines on bi-mode trains.

The Government partially agrees with the recommendation.

The Rail Minister has challenged the rail industry (in his speech on 12 February 2018) to phase out diesel-only trains by 2040, as part of a new vision to decarbonise the railway. Total electrification is unlikely to be the only or most cost-effective way to secure vital environmental benefits, but bi-mode trains are a bridging technology to future emerging technologies. Bi-mode trains also allow for the benefits of new trains to be delivered to customers without needing to wait for electric wires to be put up along entire routes.

A cross-industry task force is looking at decarbonisation of the rail sector and is currently considering the route map to no more diesel only trains by 2040 and will report back on the different technologies and capabilities in the autumn.

As part of the Government-led investment of the Intercity Express Programme a specification was agreed with the rail industry for a train design that was flexible on the source of self-power mode used in sections off the electrified line. This ensured the design of the train would allow for advances in technology but this will need to be considered in parallel with the performance and operational requirements of the trains.

Investment in Welsh rail and other options for the Cardiff to Swansea route

Recommendation 4, paragraph 44, page 16

We encourage the UK Government to engage closely with the Welsh Government to identify and scope out cost-effective transport projects on which the money saved from the cancellation of electrification could be spent. It should set out a plan for this engagement in its response to our Report.

The Government agrees in principle with this recommendation.

The Government is carrying out work to examine the case for strategic interventions between Swansea and Cardiff, and between South Wales, Bristol and London.

The Government has committed to provide the necessary funding to develop Strategic Outline Business Cases for six schemes in Wales focusing on the following:

• Improving journey times on the North Wales Main Line;
• Improving journey times on the Wrexham-Bidston line;
• Station improvements at Cardiff Central Station;
• Improving Cardiff to Severn Tunnel Junction Relief Lines;
• Station improvements in and around Swansea including looking at the case for additional provision;
• Improving journey times and connections between Swansea and Cardiff, and South Wales, Bristol and London.

These schemes, as with other new enhancements will be taken forward for consideration for approval to develop through the new enhancements pipeline process announced in March 2018. Investment into these schemes will be subject to their affordability and value for money.

Recommendation 5, paragraph 54, page 18

In light of recent developments, including the cancellation of electrification and the devolution of some responsibilities to the Welsh Government, we recommend that the UK Government, Network Rail and the Welsh Government commit to developing a revised route study for Wales over the next 12 months. This revised study should examine all options for improving the South Wales railway. Before committing to any proposals, it will be important to ensure that they are cost effective, offer good value for the public purse and draw on lessons learned from the Great Western Programme.

The Government agrees in principle with this recommendation.

Network Rail’s licence condition requires it to plan the future capability of the network in conjunction with industry partners and wider stakeholders.

The Welsh Route Study, published in March 2016, sets a series of Choices for Funders to support national and regional economic growth, and growing passenger numbers. A number of these choices are now being progressed.

A number of assumptions made in this study have now changed or been superseded. Network Rail is commencing initial discussions with funders and other industry partners about what further studies are required to inform future rail transport planning in South Wales.

It would be premature to commit to a 12 month deadline until the industry has identified the requirements for future work. When these requirements are identified, study milestone dates will be published in an annual national plan (for all such studies) on Network Rail’s website.

Recommendation 6, paragraph 55, page 18

If the track between Cardiff and Swansea were to be straightened to enable trains to run at increased speeds, the case for electrification of this route could be strengthened. We encourage the UK and Welsh Governments to work with Network Rail to explore the viability of this option. The outcome of this work can then inform the route study process.

The Government agrees in principle with this recommendation and into exploring options to improve line speeds, which could include a limited element of route straightening.

The case for improving line speeds and thus journey times on the route between Swansea and Cardiff will be reviewed in two separate, but linked, studies:

A programme level Strategic Outline Business Case for enhancements in South Wales to be led by the Transport for Wales on behalf of the Welsh Government and a Strategic Outline Business Case for improving journey times on the route to be funded by the Department for Transport.

The strategic thinking behind this case could inform further work as part of the rail industry’s Long Term Planning Process to be taken forward by Network Rail working with industry funders and partners including the Department for Transport and the Welsh Government, and wider stakeholder groups.

Recommendation 7, paragraph 56, page 19

We were interested in the proposal by Professor Mark Barry for a Swansea Bay Metro, particularly in light of the increased demand that may result from the Swansea Bay City Deal. This idea is still at an early stage, but merits further exploration. We recommend that the Department for Transport and Network Rail engage with the Welsh Government and establish a working group to explore the options in more detail. This group should report back by the end of 2018. If the group considers the proposal viable, it should then seek to develop a business case for taking the work forward.

The Government agrees in principle with this recommendation.

The Welsh Government has commissioned Professor Mark Barry to lead on some early work considering the case for wider rail improvements in the Swansea Bay region. The outcome of this work could inform a future strategic study to be led by Network Rail working with industry funders and partners, and wider stakeholder groups.

It will be for the Welsh Government to decide if it should develop a working group and develop a business case.

Recommendation 8, paragraph 57, page 19

Wales clearly receives less than its population share of investment in rail infrastructure. The new rail franchise will be procured and answerable to the Welsh Government and Network Rail now operates via a Wales ‘Route’. To ensure fairer funding and amore coherent framework for decision and policy making, we recommend that the UK Government should assess, and report back to us on, the feasibility of devolving responsibility for rail infrastructure to the National Assembly for Wales.

The Government disagrees with this recommendation.

The Government believes that it would be undesirable to re-open discussion on Silk recommendations around which there was no consensus. We therefore do not intend to revisit the question of devolving Network Rail funding given the discussions on the issue during the St. David’s Day process.

The Department does not allocate transport funding in England and Wales on a per head of population basis—spending goes where it is most needed and where it delivers the greatest value for money decisions are made based on rigorous and fair appraisal processes which ensures that outcome.

The Department continues to liaise closely with the Welsh Government on the specification and funding of Network Rail’s operations in England and Wales for each five year railway Control Period to ensure that Welsh requirements for increased capacity on the network are reflected.

Recommendation 9, paragraph 60, page 19

As part of the route study process, the UK and Welsh Governments and Network Rail should begin to consider where battery and hydrogen trains might be introduced.

The Government agrees with this recommendation.

The Government made an announcement on 12th February 2018 which stated an aspiration for no more diesel only trains by 2040. Government has requested that the Rail Delivery Group (RDG) brings forward proposals on how this will be achieved in the autumn 2018. An Industry Task Force chaired by Malcolm Brown CEO at Angel Trains is looking at the new technologies and where they would be best applied and how they could be delivered.

The new Wales & Borders franchise already let by Transport for Wales to Keolis/Amey is introducing many new trains, including newer cleaner trains.