The Office of Rail and Road’s assessment has discovered that Network Rail has maintained its delivery or planned efficiencies through the 2021/22 period, however, it has recommended that it carefully manages financial risks, especially regarding rising inflation.

The report shows that Network Rail put in place £840 million of efficiency improvement over the year, which is over its target of £830 million. The majority of Network Rail’s five regions also met or exceeded their annual efficiency targets with the Eastern region doing the best, achieving £251 million, which is 30% of the £840 million total. The Office of Rail and Road did however show concern regarding Network Rail Scotlands delivery of efficiencies as achieving just £64 million, which is 21% behind target.

The report also noted that Network Rail’s delivery of renewal work differed by region with the performance of its infrastructure being varied. The regulator found that continued focus is needed on improving its structure examinations, such as railway bridges and tunnels.

The Office of Rail and roads assessment also found Network Rail had made good progress in regard to recommendations made after the fatal derailment at Carmont, Aberdeenshire in 2020. The report highlighted that in order to deliver long-term improvements, a continued focus would be needed to implement recommendations such as response to extreme weather.

The assessment also called attention to the worsening of train service from record high levels from the prior year as the network became busier, despite this, the railway has remained generally better than before the pandemic.

Train service performance also noted that Network Rail’s Wales and Western region has seen a faster decline than other areas. The Office of Rail and Road would specifically like to see clear and targeted plans for Wales, which will bring improvements for both passenger and freight users.

ORR Chief Executive John Larkinson said:

“Network Rail has played a key role in ensuring we continue to have one of the safest railways in Europe. Its delivery of efficiencies remains strong but financial risks, including inflation, need to be carefully managed.

“There are only two years left in Control Period 6, which runs from 2019 to 2024, and an increase in financial risks could result in delayed work and under delivery of planned efficiencies.

“And as work continues with the government to facilitate rail reform, Network Rail needs to keep focused on getting the basics right. This includes maintaining safe and reliable infrastructure and delivering on financial efficiencies, to protect the interests of both taxpayers and rail users.”