Network Rail: Cost Effectiveness
(asked on 1st December 2017) - View Source
Question to the Department for Transport:
To ask the Secretary of State for Transport, if he will list the total value of efficiency savings achieved by Network Rail over (a) Control Period 3, (b) Control Period 4 and (c) Control Period 5 to date; and what proportion of that saving was from (i) direct labour costs, (ii) capital expenditure and (iii) debt servicing.
| Opex – index | Efficiency (17/18 prices £m) |
03/04 | 100.0 |
|
CP3 | ||
04/05 | 87.0 | 537 |
05/06 | 79.0 | 867 |
06/07 | 75.5 | 1,012 |
07/08 | 71.5 | 1,177 |
08/09 | 70.0 | 1,239 |
CP4 | ||
09/10 | 70.4 | 1,220 |
10/11 | 64.2 | 1,479 |
11/12 | 59.5 | 1,671 |
12/13 | 58.9 | 1,695 |
13/14 | 60.3 | 1,640 |
CP5 | ||
14/15 | 57.0 | 1,775 |
15/16 | 57.0 | 1,774 |
16/17 | 55.5 | 1,836 |
Opex savings of 45% have been achieved over the past 13 years using the regulator’s measure of efficiency as set out in the table above. This equates to total savings of nearly £18bn in current prices.
Data records are not available to show how much of the efficiency saving made has been due to direct labour costs. Capital expenditure, meanwhile, is not measurable in a comparable way – the value of expenditure can vary significantly each year depending upon the projects being undertaken.
In addition, debt servicing is not included when assessing efficiency savings. Network Rail’s interest expense is driven by external factors which are outside their control.