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ITEM CA12

RAIL PROJECTS

1. This report deals with the County Council’s priorities for the development of rail services and facilities across Oxfordshire during 2006/07, and explains how the Council will engage with its partners within the rail industry to further its rail priorities. This is an annual report and enables the Cabinet to review and, where necessary, update the list of County Council rail aspirations and establishes the priorities for officers for the next financial year paying particular regard to the opportunities that will exist with the commencement of the Greater Western rail franchise, and the Local Transport Plan 2006-2011.
2. To help the Cabinet in considering this report, Annex 1 (download as .doc file) provides a summary of the important developments within the rail industry during the past twelve months.

Key Rail Projects and Future Aspirations

3. A comprehensive list of rail aspirations was compiled in 2003 following consultation with Parish Councils, and the list has been amended since 2003 by these annual reports to reflect progress and emerging rail industry developments. The list is still valid and provides officers with guidance when taking forward the County Council’s relationship with the rail industry.
4. Each of the Council’s passenger rail aspirations is shown in Annex 2 (download as .doc file), providing a summary showing all of the passenger rail aspirations, categorised by their recommended overall priority for 2006/07, and also indicating the effect that each aspiration has in terms of staff and financial resources to the County Council. There is also an indication of the likely progress within the next twelve months. Where a change in overall priority is proposed to an aspiration this has been clearly highlighted in bold text. Annex 2 (download as .doc file), Part A provides detailed information on the HIGH priority aspirations for the next twelve months, with Parts B and C providing summary information for the MEDIUM and LOW priority aspirations. Annex 3 (download as .doc file) lists all aspirations by their recommended overall priority.

The Local Transport Plan 2006-2011

5. The Local Transport Plan sets out the County Council’s transport policies and strategies for the next five years. It is aimed at delivering the five shared priorities for transport which public consultation has confirmed are important to people in Oxfordshire.
6. Government guidance for development of the Local Transport Plan 2006-2011 stressed that any aspirations primarily aimed at extending or improving the rail network should not be included as these network enhancements should be considered separately by Network Rail and the Department for Transport in the context of available Government rail funding.
7. The rail strategy section of the Local Transport Plan 2006-2011 explains the limited but clear opportunities the Council has to work with the Train Operating Companies to influence rail use to, from and within Oxfordshire. It includes measures that are designed to achieve low-cost, effective improvements to train services and stations that aid accessibility, provide information and promote use as a means of contributing to achieving LTP objectives. The main focus will be on targeted improvements to facilities at local stations where there is potential for growth in use and modal shift, such as modern waiting facilities, improved security, secure cycle parking, good signage, better walking routes and more car parking to improve overall accessibility.
8. The Greater Western franchise will start in April 2006, and offers a unique opportunity to deliver significant improvements in station facilities through partnership working. It will be important for officers to co-ordinate delivery of any improvements with the new franchise obligations.

Improvements Recently Achieved or in Progress

9. During 2005/06, the Rail Development Officer has worked with Chiltern Railways and First Great Western on numerous improvements to station facilities throughout Oxfordshire. This has seen the introduction of new cycle parking at sixteen stations, new bus interchange facilities at Didcot and Oxford, and new lighting and signage at Culham, the latter works in partnership with UKAEA. Work is currently ongoing to introduce new waiting facilities at Bicester Town, Heyford, Shiplake, Shipton and Tackley, new cycle parking at Combe and Finstock and notice boards along the Cotswold Line and at Bicester Town. Partnership funded schemes are being taken forward at Bicester Town (with the adjacent Bicester Village Retail Outlet) and Heyford (with British Waterways and Lower Heyford Parish Council).
10. The County Council also successfully bid for funding from the Chiltern Railways User Group Fund in 2005, and consequently work is taking place at Bicester North station to improve waiting facilities and the forecourt area, and make the station fully accessible to disabled people by the installation of automatic doors and accessible toilet facilities. The work is being funded on a 50/50 basis.
11. After a delay of over 12 months, the County Council was finally successful in being granted outline planning consent for the proposed Kidlington station, although the prospects for taking the project forward are limited in the short to medium term.
12. In addition to work on the agreed rail priorities and delivering the County Council’s rail capital programme during 2005, the Rail Development Officer was actively involved in responding to the DfT consultation on the new Greater Western franchise. This had proposed some significant cutbacks in local rail services and was discussed by the Cabinet on 5 July 2005. A detailed response was submitted and other local stakeholders were also encouraged to submit their own views. A campaign by rail users was launched with support given by the County Council. As a result of these combined efforts, most of the cutback proposals were withdrawn and since then other negotiations have secured service levels commensurate with demand.

Recommended Changes

13. As well as indicating the priorities that were agreed for each rail aspiration last year, I have, in some cases, recommended that these be revised. This may be to reflect the progress achieved in the past year, or to reflect the likelihood of making progress in the next twelve months within the current rail environment, or to maximise the benefit from opportunities that are expected to arise during the next financial year. The Cabinet is therefore asked to consider and adopt these recommended revisions.
14. Members are also invited to consider any additional changes they would like to make, taking due account of the limited financial and staff resource available, and the prospects for making effective progress during 2006/07.

Prioritisation

15. The County Council only has a limited staff resource dedicated to achieving its aspirations for rail, and there is one Rail Development Officer who promotes the views and aspirations of the County Council within the rail industry, works with the industry partners and oversees all rail-related Council projects. One of the important parts of this report is obtaining guidance from Members on the relative importance of each aspiration, to allow the Rail Development Officer to concentrate his efforts more effectively over the next twelve months on projects where there is a good chance progress.
16. Other staff resources will also be available to help progress some of the aspirations, especially where there are multi-modal elements, such as bus and cycling, and schemes that form part of an Integrated Transport Strategy. There is also a continuing need for other officers who deal with transport and land use planning to encompass the agreed rail priorities, and the Rail Development Officer will support them to secure the County Council’s rail objectives.
17. In an ever changing environment it is difficult to predict with certainty how much progress will be made with each key aspiration. So that members can compare each aspiration, I have given each an overall priority, taking into account the estimated amount of resource required, and the likelihood of making progress within the rail environment outlined in Annex 1.
18. There are two reasons for recommending a HIGH priority. It enables work to progress on the aspirations where most progress is expected to be achieved in the next twelve months. This year it will allow the County Council to align its rail aspirations with the rail strategy element of the Local Transport Plan 2006-2011, and the agreed 5-year capital spending programme. It will also optimise the opportunities to secure best value for County Council funding by working in partnership with our rail industry partners.
19. It is important to ensure that our aspirations are credible if we are not to undermine our good working relationship with our partners in the rail industry. Officers know from experience that it is undesirable to include very local schemes that do not fit with wider strategic transport or spatial planning, or have been substantially achieved or have no real chance of being advanced in the foreseeable future. In order to achieve credibility some aspirations have been recommended for deletion so that resources can be focused on more credible aspirations.
20. These priorities relate to the next twelve months, and they will be reviewed again after this time. It does not necessarily mean that an individual aspiration has been abandoned or that it cannot be achieved in later years if circumstances change.
21. Following the principles established in previous years, and having regard to the resources available, aspirations that have a recommended overall priority of LOW will only be mentioned as Oxfordshire County Council aspirations when the opportunity arises, but with work on them not otherwise being undertaken. An overall priority of MEDIUM will enable officers to actively pursue a particular aspiration as and when the opportunity arises, whilst an overall HIGH priority will indicate those aspirations that will be proactively pursued and will occupy the bulk of the Rail Development Officer’s time.
22. Members may wish to consider revising some of the recommended overall priorities. However, the Rail Development Officer only has limited resources to work proactively on a small number of projects at any one time and I would suggest that no more than 5 HIGH priority schemes which have a HIGH staff resource, or an equivalent number of lower staff input projects, can be taken forward simultaneously. However, in the case of station improvements, many individual aspirations could be achieved with a lesser amount of staff resource through the grouping together of aspirations into one larger programme of work.
23. The effect of moving a small number of aspirations between the LOW and MEDIUM priority categories would have only a small effect on officer workload. However, the greater the number aspirations moved to the MEDIUM category, the harder it will become to determine the relative importance of each. A significant increase in the number of MEDIUM priority aspirations would in practice mean that all would have to be treated as if they had a LOW priority.
24. If members decide to elevate some of the aspirations in overall priority, they would also therefore need to consider decreasing the priorities of a similar number of aspirations or to allocate additional resource.

Potential Funding Mechanisms

25. The Department for Transport (DfT) has taken over the strategic decision making on rail investment from the Strategic Rail Authority. All decisions about railway investment and priorities, and approval of spending plans by train operators, are now taken by the DfT Rail.
26. The Government has provided a large amount of funding for committed major projects such as the West Coast Main Line, but the cost of running the railway has also increased over the past few years and significantly more money is now being paid to train operating companies than was the case in the final years of nationalisation in the mid-1990s.
27. The Strategic Rail Authority, under guidance from the Treasury, had started to look more closely at constraining cost escalation and had taken measures to reduce discretionary funding and consider low-cost solutions when specifying infrastructure work and franchises. DfT is continuing with the same philosophy. Recent strategic publications, such as the Great Western Route Utilisation Strategy, reiterate that there is no Government money for rail enhancement. However, there are some new mechanisms for funding, such as TIF (Transport Innovation Fund) and CIF (Community Infrastructure Fund), which can be used if certain qualifying criteria are met
28. The only other source of rail industry funding comes from Network Rail and the train operating companies. Network Rail’s financial requirement is determined on a five-yearly basis by the Office of Rail Regulation which considers the amount of money that is required to operate the track and signalling, including maintenance and renewal. They raise this money by levying a charge on train operators for using the network. Network Rail is not funded for enhancement within the current financial period that lasts until 2009. Its resources are focused on delivering reliable infrastructure to the train operators so that performance can be improved, and it is engaged in major track replacement throughout the greater western area.
29. The train operating companies agree a financial settlement at the beginning of their franchise and no longer have the freedom to spend money as they would have done just a few years ago. This allows them to plan their investment throughout the term of their franchise, but also means that once an franchise is agreed there is limited funding available for additional investment unless it can be secured from sources outside the rail industry.
30. First Group has been awarded the Greater Western franchise, to start in April 2006, and has agreed investment of £200 million with DfT. This will be spent on many projects across the franchise, such as refurbishment of the High Speed Train fleet (£92 million), on-train CCTV, new ticketing machines and replacement of the FGW Link customer information system, more car parking spaces, better interchanges and stations, and infrastructure work to increase train speeds into London. This gives a unique opportunity for the County Council to encourage further investment in local rail facilities.
31. By working in partnership with the rail industry, neighbouring local authorities and other third party stakeholders, we can ensure that the funding that each party has available can be used to best effect. Officers have been successful in the past with securing significant third-party contributions to fund work at Culham and Hanborough stations, and are finalising further commitments for 2006/07. The opportunities for partnership working often arise at relatively short notice and it is often vital to provide a quick indication of the level of commitment to ensure the opportunity is not missed.
32. In addition to the annual LTP capital programme, a source of funding comes from developer funding secured from commercial and housing development. Some money has already been secured for railways in this way, but there is potential for more contributions to be secured from this source and directed towards transport infrastructure, including railways.
33. Officers also hope that those local authorities that can demonstrate a funding commitment will benefit from greater investment in their stations, and they intend to build on the existing County Council relationship with the rail industry to maximise the benefits for Oxfordshire.

Staff and Financial Implications

34. Officers have a good relationship with the key rail industry partners (DfT Rail Group, Network Rail and the train operating companies) but their rail priorities do not always match those of the County Council. This makes it difficult to predict the level of staff resource that might be needed to make effective progress in gaining support from the rail industry.
35. It is clearly not possible to quantify the number of hours or days of officer time that may be required on each project. However, it can be assumed that more officer effort and time would be needed to convince the rail industry of the benefits of taking forward some of the LOW priority aspirations, as this priority in part reflects the lack of support they have from the rail industry. For indicative purposes only, I have given an indication of the likely implication on officer time on a low, medium and high basis, based on the information available at the present time.
36. The extent of County Council funding will only become clearer as each project is progressed. Some aspirations may be funded entirely by the rail industry if the cost to them is relatively low and they are linked to other work being given priority by the rail industry. With others the rail industry would probably look to the County and/or District Council to make a contribution towards the cost. In some instances, the County Council may have to provide all the funding itself if an aspiration is to be achieved.
37. Any contribution from the County Council towards all, or part, of a rail project will come from the LTP Capital Programme 2006/07. However, capital funds can only be used for delivering an agreed scheme, any initial design and feasibility work would first need to be funded from a revenue budget. The success or failure of a project often depends on the ability to fund feasibility work at short notice and in previous years the Executive agreed a specific budget for rail development within the Public Transport Revenue Support budget. This is used by officers to fund existing subscriptions to rail partnership groups, and specific work to take forward the rail priorities, without the need to refer to Cabinet each time. Officers recommend that the Council continues to "ring-fence" a specific revenue budget of £30,000 for these purposes so that opportunities can be exploited when they arise. The Cabinet is asked to give delegated authority to the Head of Transport to determine in consultation with the Cabinet Member for Transport, where the capital and revenue funding will be used to achieve the County Council’s rail priorities and to make subsequent modifications if necessary.
38. Until work on each project is further advanced, it is not possible to provide more exact costs, or how this might be split between different parties. I am therefore only able to give an indication of the likely financial implication of each project for guidance only. Again this is on a HIGH, MEDIUM and LOW basis.

RECOMMENDATIONS

39. The Cabinet is RECOMMENDED to:

1. note the progress of the key rail projects during the past year;
2. subject to any additions or amendments that members wish to make to existing aspirations, adopt the recommended priorities for and, where applicable, the recommended changes to, the proposed rail aspirations as indicated in the report;
3. note that an amount of £135,000 has been included for rail development in the 5-year LTP Capital Programme for 2006/07, agreed by Cabinet on 21 February 2006;
4. continue the allocation from the Public Transport Revenue Support budget of up to £30,000 for feasibility and other related work to take forward the County Council’s rail aspirations;
5. authorise the Head of Transport, in consultation with the Cabinet Member for Transport, to determine how funding can be used to achieve the Council’s rail priorities and to make subsequent modifications if necessary.

STEVE HOWELL
Head of Transport

Background papers: None

Contact Officer: Adrian Saunders, Rail Development Officer Tel: Oxford 815080

March 2006

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