24/10/2003

'Fundamental review' sees rail maintenance brought in-house

Network Rail has announced that it is to bring rail maintenance activity back in-house, and so unify the operation and maintenance of Britain's rail infrastructure.

Today’s announcement represents the "most fundamental restructuring" of Britain’s railway since British Rail was reorganised in 1994, two years before privatisation. The decision to transfer some 18,500 people from infrastructure maintenance contractors (IMCs) to Network Rail was taken following "careful consideration of the conclusions of a fundamental review" of rail maintenance that has been carried out over the last six months.

The move will see contracts currently held by the seven Infrastructure Maintenance Contractors transferred to the government-assisted company.

Network Rail’s says the move will deliver high standards of rail maintenance across the rail network, significant efficiency savings, and continued improvement in trackside safety standards.

The exact timing of taking each individual rail maintenance contract in-house is subject to "detailed commercial negotiations" and safety case approvals. The speed of progress will also be dictated by the need to ensure a smooth transition.

The current structure of outsourced rail maintenance involves seven IMCs - Amec, Amey, Balfour Beatty, Carillion, Jarvis, First Engineering and Serco – 20 contract areas, "considerable management duplication and complex reporting, hand-back and inspection procedures".

Network Rail says that there will be a single management structure with "clear lines of accountability and a simplified relationship between operations and maintenance". The company will ensure that maintenance is carried out by a permanent workforce of "well-trained individuals committed to a strong safety culture".

Ian McAllister, Chairman of Network Rail, said: “Rail maintenance is a central part of Network Rail’s operation. We have completed a detailed assessment of railway maintenance and obtained a clear understanding of the reasons why costs have risen in recent years. Bringing maintenance contracts in-house will ensure greater consistency of maintenance standards and help deliver efficiency savings far more quickly than would otherwise have been possible.

“We have thought long and hard before taking this decision. We have studied its implications in great detail and concluded that it is the right thing to do."

(gmcg)

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