With passenger numbers hitting 100% of pre Covid levels we need to invest in UK rail, powering a clean economic recovery
Following the release of Department for Transport figures showing passenger numbers hitting 100% of pre Covid levels, Chief Executive of the Railway Industry Association, Darren Caplan, sets out why we need to expand the capacity of the UK rail network.
Last week Chancellor Jeremy Hunt delivered his much-anticipated Spring Budget. Rail didn’t feature high up on his list of priority areas, especially given the news that part of construction on HS2 Northern Leg will be delayed by two years had already been pre-briefed the week before. However, building more capacity on the UK rail network has never been more urgent, as contrary to often misleading reporting, passenger numbers have been returning to rail travel in droves, and rail plays a key role in helping to power the UK economy and decarbonisation.
1. Rail passenger numbers have reached over 100% of pre-Covid levels, and revenues are now up to 90%
Just over a year ago, at the start of 2022, passenger numbers were barely half of pre-pandemic levels. Yet a year on, Department for Transport data shows that on Friday 10 February, passenger numbers hit 100% of pre-Covid levels for five days in a row, which of course included weekends and the alleged remote working days of Monday and Friday. On Wednesday 22 February, they reached 103%. Further, revenues have been hitting 90 per cent of pre-Covid levels too, with every prospect this will increase in the future.
This return to rail has taken place with the background of widespread industrial action on the network, some passengers having poor customer experiences, and the uncertainty over rail restructure hanging over the organisations which are delivering services. Also, the comparison on passenger numbers compares today’s levels with April 2019 to March 2020, the second highest year on record.
Clearly, the story is that as we recover from the pandemic, people are going back to their previous routines of working, visiting friends and family, and enjoying leisure and hospitality. The remote working revolution has perhaps been over-reported too, with so-called hybrid-workers increasingly spending more time in the workplace, and Mondays and Fridays proving just as popular days to travel by rail as other weekdays.
2. Message to policy-makers: UK rail needs investment, not managed decline
So despite the sometimes negative noises we hear from some policy makers and influencers, rail does not need post-pandemic managed decline. It needs the exact opposite: sustained investment to keep up with growing demand. The Government has already partly recognised this with its re-commitment last November to major projects: schemes like HS2, Northern Powerhouse Rail and East West Rail are all set to go ahead, even if, regrettably, at a slower pace.
Last December’s announcement that rail Operations, Maintenance and Renewals spending is to be maintained in the next five-year control period (CP7) to at least the levels of the previous five years (including a small real-terms increase) is to be welcomed too. However, supporting UK rail is not just important to enable passengers to get from A to B, it is also sustaining an industry which is significant for UK plc, as well as one which has generally paid for itself through £14bn in annual tax revenues.
3. Rail is an important economic sector which can power clean economic growth
Oxford Economics showed in 2021 that the railway industry supports 710,000 jobs, £43 billion in Gross Value Added, and for every £1 spent on rail, £2.50 is generated in the wider economy. Not only is growing rail imperative to catering for growing passenger and freight numbers on the railway, but it can also play a strong helping-hand in powering the UK economic recovery too. It should not be seen as a cost on the public purse, in the way that it is sometimes portrayed.
Rail is also crucial for the Government if it wants to hit its decarbonisation objectives, getting all diesel-only trains off the network by 2040 (2035 is the Scottish Government target) and to making rail Net Zero by 2050. Rail plays a small part of the carbon problem, but can be a big part of the solution. To take just one example, a single freight train removes up to 76 lorries from the roads, significantly cutting carbon emissions. Yet at the current level of investment in, for example, electrification and battery and hydrogen powered trains, the 2050 target will be nowhere near hit. Currently the UK has only 38% of track electrified compared to 57 per cent in mainland Europe; and, according to Office of Rail & Road data, between 2020 and 2022 the amount of electrified track actually fell by 7km, from 6,049 to 6,042!
4. Six ‘asks’ of Government’
So the Railway Industry Association and our members have six key asks of the Government:
- Commit to investment pipeline certainty and transparency – certainty and visibility of future investment plans generates best value for taxpayers and investors
- Invest in major rail infrastructure projects – major rail projects are transformational for the communities they connect, the wider economy, and in transitioning the UK to clean transport, so continue to fund in full major schemes such as HS2, East West Rail, and Northern Powerhouse Rail
- Accelerate decarbonisation and green growth – with a step-change in track electrification and ramp up in support for battery and hydrogen trains
- Get on with rail reform – deliver Great British Railways restructure and a long-term strategy for rail
- Unlock innovation and boost R&D – boosting efficiency and productivity, and enabling rail to rise to challenges such as climate resilience
- Help grow UK rail exports, at a time when rail markets are set to grow 3% every year to 2027 – the UK has a strong global reputation, so there is great potential to grow rail exports, boosting trade and also increasing resilience of the UK’s supply chain
It is clear that for reasons of capacity, the economy, and decarbonisation, we need to continue as a country to invest in rail. The strong passenger return to rail makes this all the more imperative, given that rail is a long-term game and the work to grow rail needs to take place straight away if we are to have the capacity we need for both passenger and freight customers both now and in the future.
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