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Public Accounts Committee calls for radical and effective reform in the rail system

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A report by the Public Accounts Committee states that the Department for Transport (DfT) “has neither the necessary urgency nor appreciates the scale of the challenge ahead” about the future of rail.

Repeating its claims that passengers are too often an afterthought in major rail projects, the spending watchdog notes that the end of franchising offers options to deliver better services for passengers in a way that meets new travel demands. However, this means that the DfT now faces “an extremely challenging and uncertain environment in which to implement its proposed reforms”.

The committee’s report continues by commenting that the English rail system has “suffered from a lack of strategic direction and accountability for many years” and “struggled to improve service reliability, quality and flexibility” with “delivery of services not sufficiently focused on the needs of passengers”.

Massively increasing expense to the taxpayer in the English rail system has not been matched with sufficient transparency about costs and revenues to “inform proper oversight” in an area with “this extent of taxpayer exposure”, the Public Accounts Committee states.

Costs to the taxpayer in the failed franchise system almost doubled from 2015 to £5.1 billion in 2019-20, with another £8.5 billion of government financial support provided after the arrival of the COVID-19 pandemic finally collapsed the previous delivery model.

But the committee says it is now unclear that the Department for Transport’s plan for railways during the transition to a new system “fairly distributes risks between government and operators, or provides incentives for operators to deliver efficient, high-quality, and value-for-money passenger services.”

DfT also “lacks a convincing and timely plan for encouraging passengers back to the railway as part of COVID-19 recovery” and this, combined with a “disappointing lack of progress in agreeing a specific and funded plan for rail electrification” pose further risk to the government’s own net zero targets.

The report’s summary concludes: “Now is the time to make radical, effective reform in the rail system and aspirations and intentions need to be turned into concrete actions that deliver meaningful change.”

Dame Meg Hillier MP.

Public Accounts Committee chairman Dame Meg Hillier MP commented: “Decent public transport is crucial to both household and national economies. Rail reform won’t work if it doesn’t work for taxpayers and fare-paying passengers, and the government won’t achieve its economic and environmental goals without effective rail reform.

“There is everything to play for in delivering a rail system that delivers for passengers and encourages greener travel. But there are still many moving parts and a huge challenge to balance costs. The government needs to show it can act with urgency and put passengers’ experience at the centre of its reforms.” 

Railway Industry Association chief executive Darren Caplan picked up on the committee’s comments on electrification: “It is positive to see the Public Accounts Committee making the case for a consistent programme of electrification work.

Darren Caplan, Railway Industry Association.

“Alongside battery and hydrogen train fleet orders, electrification is essential if we are to meet the government’s Net Zero decarbonisation goals. As the committee highlights, delivering a rolling programme of work, without the ‘boom and bust’ investment profiles we’ve seen in the past, is a cost-effective way to electrify the UK’s intensively used rail lines. This certainty will also help to retain key skills and enable innovation, supporting green jobs and economic growth at this crucial time.

“We look forward to working with the government to build on these recommendations, and to deliver on the decarbonisation of the rail network ahead of COP26 at good value for the taxpayer, as our Rail Decarbonisation 21 campaign calls for.”


Public Accounts Committee report conclusions in brief:

  1. The Department lacks a convincing and timely plan for encouraging passengers back to the railway as part of COVID-19 recovery, and risks an increase in car use.
  2. In recent years, we have identified serious failings in the rail system, and the Department must now overcome significant long-standing issues to bring about complex reform.
  3. Published information from the Department and the Office of Rail and Road on whole-system costs and revenues is not sufficient to inform proper oversight of the rail system, given the extent of taxpayer exposure.
  4. It is not yet clear that the interim National Rail contracts fairly distribute risks between government and operators, or provide incentives for operators to deliver efficient, high-quality, and value-for-money passenger services.
  5. We are disappointed at the lack of progress in agreeing a specific and funded plan for the electrification required to achieve the government’s own net zero targets.
  6. It is not clear to us how Network Rail expects to achieve the remaining efficiencies planned in Control Period 6.

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