Written question asked by Tom Brake (Liberal Democrat) on Thursday, 2 February 2006, in the House of Commons. It was due for an answer on Monday, 6 February 2006. It was answered by Derek Twigg (Labour) on Thursday, 16 February 2006 on behalf of the Department for Transport.

Network Rail

Question: To ask the Secretary of State for Transport what incentives are in place to encourage Network Rail (a) to improve its efficiency and (b) to complete renewals expeditiously.

Answer: The Office of Rail Regulation (ORR) has determined, the outputs that Network Rail must deliver in the five-year control period to March 2009, and the associated revenue allowance. This revenue allowance is based on estimates of the expenditure required by a competent and well-managed company to deliver the stated outputs, including an allowance for efficiency savings. As part of this, Network Rail must deliver an efficiency saving of 31 per cent.This approach provides strong incentives on Network Rail to improve cost efficiency, as they benefit from reducing expenditure below that assumed in setting its allowed revenues, provided that it delivers its required outputs and does not compromise long-term asset condition and serviceability of the network.These incentives for cost efficiency are also reflected in the remuneration arrangements for Network Rail's senior management.The main incentive on Network Rail to complete its renewals expeditiously are the conditions of the track access contracts that it enters into with train operating companies. These contracts include a mechanism whereby Network Rail makes compensation payments to train operating companies for changes to train timetables that result from the need for engineering works.

Secondary information

Type: Written question
Reference: 49809; 442 c2411W;442 c2411W
Session: 2005-06
Related items: Network Rail
Monday, 27 February 2006
Written questions
House of Commons
Subjects: Railway network Network Rail Standards Repairs and maintenance
Link: View this Written question on www.publications.parliament.uk