Information on trends in infrastructure costs on the railways are published by the Office of Road and Rail in its UK rail industry financial report, which is found on its website. Spending by Network Rail was £7.3 billion in 2016-17, an increase of half a billion pounds, or 7% in real terms, on the previous year.
Since rail privatisation, the costs of rail infrastructure works have gone through the roof, multiplying several times. The Minister may have seen a recently published analysis showing that electrification, for example, now costs seven times more in real terms—stripping out inflation—than when British Rail electrified the east coast main line. Is it not obvious that we should not only nationalise train operations, but rebuild publicly owned in-house works capacity and save billions for the public purse and for passengers?
I remind the hon. Gentleman that Network Rail is responsible for most railway infrastructure work in this country and it is, of course, in the public sector. He rightly highlights the need for Government to ensure that they get the greatest possible efficiency and value for money from all our infrastructure investments. That is why we have set up a mechanism to benchmark costs across the industry in the most rigorous way possible so that we get full value for money from the record sums that we are investing in our railways— £48 billion over the next five-year period.
Despite being the centre of population of our country, my seat has no railway station. I have been campaigning for many years for the opening of the Ivanhoe line between Burton-on-Trent and Leicester to aid further economic growth and reduce road congestion. Does the Minister agree that it is better to spend money on these local deliverable projects to improve people’s lives than on national white elephant projects with huge runaway budgets?
Of course, we need to invest in transformative schemes such as HS2 and Crossrail, which are going to change connectivity for the better, but we can do everything. We can invest also in the smaller schemes, which will deliver valuable change to local communities.
The Minister will be aware of my ongoing campaign to close the Pencoed level crossing in my constituency. When he met me, he said that Network Rail had not prioritised the closure, but Network Rail tells me that the scheme costs so much that it would require additional funding from the UK Government. I am meeting representatives of Network Rail again tomorrow, so can he say now, ahead of my meeting, that Ministers in the DFT will give additional funding to close the level crossing?
We take the issue of safety at level crossings exceptionally seriously. This is an area that the Department, alongside Network Rail, is looking at closely, and I look forward to receiving an update from Network Rail following the hon. Gentleman’s meeting with its representatives tomorrow.
The Great Western electrification project has become a case study in weak project planning and control, so will my hon. Friend work closely with the Railway Industry Association on its electrification cost challenge to help drive down the costs of these projects with a view to looking again particularly at the south Wales bit of that project, because electrification of all the main lines must remain a long-term ambition for our railways.
I share my right hon. Friend’s concerns in that respect. That is why the Department has asked the industry to come together in the transport infrastructure efficiency strategy, which was launched last year and which will benchmark costs, including in electrification, so that we get the greatest possible value for the money that we are investing in our railways.
We are investing £48 billion in these projects over the next five-year period. It is vital that we get value for money. Obviously, it is disappointing that Crossrail, which is a 100% subsidiary of Transport for London, told the Department that it needed to revise the delivery schedule for phase three of the project. We are disappointed by the news and want that phase completed as rapidly as possible.