A report from the National Audit Office today criticised Network Rail for not passing enough information to the Office of Rail Regulation to accurately judge its ability to hit costs cuts targets.
The ORR set tough efficiency targets for Network Rail which has come close to meeting them by making efficiency savings of 27% in the five years to 2008-09 – equivalent to £1.8bn in that final year.
This was below the ORR’s target of 31% but the regulator believes further savings can be made because maintenance and renewal activities were 34 to 40% less efficient than the best European rail infrastructure managers in 2008.
The Regulator estimates that Network Rail can achieve further efficiency savings of 21% in the five years to March 2014 – equivalent to spending £940m less in 2013-14 than forecast.
Amyas Morse, head of the National Audit Office, said: “The gap between Network Rail’s efficiency, as a monopoly provider, and that of comparative European rail infrastructure managers has been effectively identified by the Office of Rail Regulation.
“It is so wide that it has served up to now to drive forward improvements in efficiency by Network Rail. However, further progress will depend on the Regulator developing significantly better information on Network Rail’s costs.”