Written evidence submitted by Mark Barry, Professor of Practice in Connectivity at Cardiff University’s School of Geography & Planning (RIW0001)

Thank you for inviting me to present evidence to the Welsh Affairs Select Committee’s investigation of Rail Infrastructure and Investment in Wales[1]. As many of you know, I have been involved in Rail Policy and Rail Development in Wales since 2010, much of that related to the South Wales Metro.  My roles and publications have included:

• Author of 2011 report, “A Metro Wales Capital City Region[2]” commissioned by the Cardiff Business Partnership and published by the Institute of Welsh Affairs
• Submitted and presented evidence to the Westminster Transport Committee’s review of High-Speed Rail in 2011[3]
• Author of, “A Cardiff City Region Metro: transform | regenerate | connect[4]” in 2012/3 developed with the Metro Consortium
• Led development of the 2013 Welsh Government commissioned, “Metro Impact Study[5]”
• Led development of South Wales Metro for Welsh Government (PT) Nov 2013 – Jan 2016
• Prepared, “The Rail Network in Wales – The Case for Investment”, for WG in 2018[6]
• Presented evidence to the Senedd Economy and Transport Committee re: the procurement of the W&B franchise in 2018[7]
• Prepared Welsh Government’s Rail Enhancement priorities[8] in 2020 and the supporting analysis of rail investment in Wales[9]
• Helped prepare Cardiff Council’s Transport White Paper and the Cardiff Crossrail proposals[10]
• Prepared advice and suggestions to the South East Wales Transport Commission[11]
• Developed the concept of a Swansea Bay Metro now being progressed via TfW.

I am now acting as a Strategic Advisor to TfW (part time) and am helping, in an independent capacity, the Cardiff Capital Region prepare a rail vision. I am also (again part time) Professor of Practice in Connectivity at Cardiff University (since April 2016) and have run events and published reports and articles related to Metro, most notably the “Metro and Me[12]” report and event held on 8th October 2018 (in partnership with Cardiff University, Capital Law, IWA and Arup).

To note: the views and opinions expressed in this paper are those of Mark Barry and no other person or organisation. 

The Committee has set out a number of questions; I have tried to answer each below and would note that much of the supporting data and analysis is covered in the various documented references on the first page. I would also point committee members at a number of relevant “blogs” I have published in the last three years:

• In respect of Wales and HS2 from January 2020[13] which I think effectively sets out the systemic institutional failings in respect of long-term investment by UK Government in Wales rail infrastructure. 
• My public transport proposals for the M4 corridor[14] as an alternative to more “road capacity” and the inherent need for all of us to reduce our car use – most of which were reflected in the final report of The South East Wales Transport Commission[15]
• My article supporting the WG Case for Investment in Wales’ Rail Network in 2018[16]
• The need for innovation in developing rail schemes in some parts of Wales[17].

Where does responsibility lie for rail infrastructure in Wales? 

The Welsh rail network apart from, since early in 2020 the Core Valley Lines (CVL) north of Cardiff, is the responsibility of the UK Government via the Department of Transport (DfT) and Network Rail (NR).

How effectively do the UK and Welsh Governments cooperate with one another in the management, and funding, of rail infrastructure in Wales? 

Historically this ranges from poor to not at all; the rail industry ecosystem and decision-making processes are designed around the centre of gravity of Whitehall and population density in SE England. 

For example, a review of the “Passenger Demand Forecasting” guidance for new schemes vs actual observed demand has over estimated demand for schemes in London by approx. 50% and underestimated demand for schemes elsewhere in the UK by approximately 50%.  This has resulted in a disproportionate allocation of enhancement investment to the London/SE England.

This is another contributory factor for why, in my view, Wales’ rail network has and continues to be systematically disenfranchised in respect of enhancement investment. For example, even with the interest secured in 2009/10/11 for electrification of the GWML and valley lines, the UK Government ultimately stepped back and dropped proposals for Swansea and the Valley lines. It was only WG who took on the Metro proposal by committing a significant proportion of funding required.  Without WG I can very confidently assert there would be no valley line electrification and South Wale Metro.  

As set out in the various referenced document, Wales has a more “depreciated” rail asset vs the UK average.

Should responsibility for railway infrastructure in Wales be fully devolved?  

Yes, no question.  Building from the last question, it is clear to me, that the organisation best able and capable of developing and leading the implementation of new rail schemes in Wales is Transport for Wales. Network Rail may retain a delivery and operational role for those parts of the network for which it is Infrastructure Manager but should be subservient to WG/TFW in respect of strategy and investment priorities. This is the arrangement that has been in place in Scotland since 2006.

Even before the difficult discussions re rail devolution are resolved, TfW should be acknowledged as the organisation responsible for business case and scheme development (and not DfT or NR); TfN enjoys such status in England. 

I am hoping the Williams Review will come to the same conclusion.

I would also point out that the recent transfer of the CVL to WG was wrapped in unnecessary bureaucracy and costs for what was already a public asset in Wales.  Traditionally, such transfers e.g. Metrolink in Manchester and earlier the Tyne and Wear Metro, were I believe subject to a nominal £1 fee.

However, the current NR/DfT price tag for the CVL of ~£400M (I dont know the exact figure) reflects a bizarre and frankly challengeable valuation based on Network Rail’s Regulatory Asset Base (RAB).

The RAB was established in the 1990s after privatisation, to allow Railtrack to issue bonds to fund further rail enhancement. However, whilst the debt related to the RAB was spread evenly across the network to “value” the asset, the funds generated through the bond sales were not (and Wales has received very little of that despite its network being apportioned the debt via the RAB).

Even after the inclusion of NR debt on the Governments balance sheet since 2014/15, this “suspect” accounting practice still survives. Very crudely, network valuation = last year’s network value - depreciation of asset + apportioned enhancement spend (irrespective of where those enhancement actually were); there is also a factor based upon discounted future cash flows for income received from an asset (e.g. Track Access Charges).

If one looks at the details and notes of NR’s 2018 accounts[18] one can see that this “methodology” was really retained to support valuation of NR asset that could be sold to private companies. It should not be applied to transfer of a public asset between governments – especially when the publicly owned asset is located in the geography of the “purchasing” public body as was the case with the CVL.

The final agreement on the ongoing OMR value will be interesting.  I am not sighted on that.  Whilst the CVL transfer is now done and whilst I understand WG were held harmless financially by UK Treasury, we now have a precedent set for such asset valuations which I view as completely inappropriate.

What share of investment has Wales secured in its rail infrastructure since privatisation came into effect in 1994, and how sufficient is this level of investment? 

I have undertaken an analysis for WG which looked back to 2001 and out to 2029 and found that at least £100Bn has or will have been invested by UK Gov in enhancement to the UK rail network in that period. The most generous interpretation of the enhancements UK Gov has funded in Wales over the same period is £2.2Bn. This highlights a shortfall in Wales Vs UK average of at least £2.9Bn (based on the most conservative set of assumptions); a more even-handed analysis would generate a bigger shortfall.

I can also confidently assert, that in the period from 1994 to 2001, there were no significant enhancements investments on the Welsh rail network.  In fact, it was I believe, the then Strategic Rail Authority (SRA)and UK Gov who killed of the proposal at that time to introduce Light Rail on some of the valley lines and the bay line.  At the same time the UK Gov was planning and began implementing the eventual £14Bn upgrade of the WCML (to note: only £7Bn of that figure was included in my assessment of UK enhancement spend for WG).

One may argue in respect of the fine details, but from 1994 to 2020 Wales has received, being as generous as possible to the UK Government, at best 3% of rail enhancement investment. This analysis generously includes and apportions the entirety of the DfT Barnett allocation of £760M to WG in 2015 as “UK Gov investment in Wales rail infrastructure”. In reality this is an overestimate noting that a significant proportion of that Barnet allocation was likely due to devolved spend which should not be included in the analysis. 

So, if we ignore the 2015 Barnet allocation the %age falls to less than 2%.  A route-based allocation of UK spend to Wales suggests a figure of 10/11% would be more appropriate and a population-based allocation approx. 5%.  I would also note that the Great Western Electrification Programme (GWEP) enhancement allocation to Wales for 2015-2019, was based on the Wales route so includes the total costs for the electrification of the Severn Tunnel.  This sets a precent for route based (and so track miles) based allocation of enhancement funding to Wales.

It is also worth noting that the recent WG analysis of UK Rail investment sourced the HS2 Chairman’s Stock Take in August 2019[19] and not the more recent DfT HS2 Phase 1 Full Business Case(FBC)[20].  This FBC highlighted an increase in total capital envelope for the scheme from £77Bn to £108Bn and Phase 1 from £37Bn to £43Bn.  The full Business Case also included “Wider Economic Impacts” which have not traditionally been included in formal BCR calculation.  These variations to more narrowly defined appraisals (which I welcome) help bolster the BCR (which is still marginal) given the increases in capex as well as modelling scenarios using 100-year appraisal period (and not 60 which is more typica).

So, as stated, one may argue over the fine details; but the reality is that there is a shortfall of £Bns in rail enhancement investment in Wales Vs the average across the UK.  This will only grow in the next decade as a result of projects like HS2, TransPennine Upgrade, Northern Powerhouse Rail & Clapham remodelling, unless there are substantive changes.

To note: enhancements improve the capability, capacity, reliability of the rail network; the limited share of such investment in Wales vs the rest of the UK network has led to relatively less attractive services, attracting fewer passengers, resulting in lower modal share and higher subsidies. This is different from the Operations, Maintenance and Renewal Spend (OMR) which is about maintaining the network’s current capability and reliability.  However even that figure is only about 5~6% of the total which is set against the fact that 10/11% of the UK network is in the Wales route.

How is funding allocated to rail infrastructure projects across the UK and how are the different infrastructure needs of the regions and nations of the UK assessed? 

Wales’ rail schemes get processed via the DfT/NR Rail Network Enhancement Pipeline (RNEP) process. Whilst there is some collation of schemes for Wales and the West of England (mirroring the NR Region) they all go through the same pipeline and assessment process on an England and Wales basis.  The data is clear - this process fails Wales.  The NR SW Route has more resources and capability to bring forward schemes – and as a result has “filled” the pipeline.  There is limited resource in the Wales NR route to do this kind of work.  As stated WG and TfW do not have a formal strategic role in this process but have actually undertaken all the major strategic scheme development for the last three years. This is a failing in the process as there is no formal means for WG/TfW schemes to enter the pipeline; nor should they have to. 

To note: Scotland is not constrained in the same way as responsibility for such matters and the funding decisions are made by the Scottish Government and Transport Scotland – even though NR is still the IM for their network. Wales should be treated the same as Scotland in this regard.

To note: UK Government has just cut the Enhancement budget to 2024 by £1Bn; it is clear that HS2 investment will squeeze other rail investment in “England and Wales”.

What will be the impact of the Covid-19 pandemic for the railway network in Wales (including the sustainability of services and potential impact on investment in railway infrastructure)? 

Clearly Covid has had a major impact on travel patterns and especially commuting.  Things will be different once we are through Covid. However, I assert we still need much more PT capacity - including rail:

• Undoubtedly there is a major revenue shortfall as a result of Covid and even with a vaccine this year this will likely impact revenue for the next two or three year.  There are a lot of fixed costs in the rail industry, ( eg  staff and rolling stock) so it is difficult to scale down operating costs to match the fall in demand.  However, over the longer term we will still need more PT and rail capacity
• Pre-Covid less than 20% of trips were via public transport (PT), car use was at 80% of mode share.  With a Climate emergency this is unsustainable and has to change. (See my M4 article for more details[21]).  Electrifying the current car ecosystem will not be enough, we need to reduce car use first

Driverless cars as a service, batteries and urban spaces… Mark Barry, 2016

Smart Mobility Symposium - M Barry, Feb 2020

• We have, and in some places, continue to build homes, offices, retail, public services, etc in places that can only be accessed by car – typically out of town and next to major road and motorway junctions.  This has to stop; we have to embrace Transit Oriented Development[22] and gradually re-locate offices, retail, public services back to town and city centres.  This will make PT more attractive and so reduce carbon emissions and help regenerate many of our run down, town and city centres
• Even with a welcome reduction in the twice a day 5 day a week commute for 8 hours work a day in an office, I believe we will still need offices[23].  Even if the demand for space in city and town centres dropped by as much as 30% we can more than make up that reduction by the relocation of offices, services, etc from those car based out of town locations back to our town and city centres – this can include more local shared work hubs as championed by groups like Indycube.

What opportunities are there for Wales as a result of the recently launched Union Connectivity Review? 

It really depends on the intent.  Essentially Wales “knows” what it wants in respect of rail enhancements, it just lacks the powers and funding to develop and implement them. I am not convinced this process will result in the substantive changes nor deliver the investment that is merited.

You maybe aware, that WG proposals have been developed with regard to the forthcoming Wales Transport Strategy which sets out an intent to build a transport system within Wales that is fit for the Climate Emergency, fit to build back better from Covid, and fit to build a more equal and prosperous society.   Crucially, aside from encouraging a complementary reduction in our collective car dependency, this means extending the ‘reach’ of our main rail arteries so that they much better serve their hinterlands by interactions with local bus, rail and light rail services. This will secure both economic and environmental benefits.

WG has already made known to the UK Gov its views as to the clear failings of the current institutional arrangements related to the management and investment of the rail network in Wales and set out its priorities for enhancement.  WG has also reaffirmed its view, that any levelling up interventions have to positively discriminate funding decision in favour of those places in need of “levelling up”.

The following recent publications and statement encapsulate the WG position – I helped prepare some of these and concur with all of them.

Mainline railway enhancement requirements in Wales (gov.wales) (2020)

Historical investment in rail infrastructure enhancements | GOV.WALES (2020)

Written Statement: Union Connectivity Review (23 November 2020) | GOV.WALES

A railway for Wales the case for devolution.pdf (gov.wales) (2019)

The Rail Network in Wales - The Case for Investment (2018)

To restate work already publicised by WG, my priorities are:

• That WG secures full devolution of rail powers and funding for the rail network and services in Wales - with appropriate and equitable arrangement to manage cross border matters 
• In advance, WG via TfW, secure formal responsibility for scheme and business case development within the current institutional arrangements with a more appropriate allocation of enhancement and scheme development funding to Wales to support the development and delivery of the emerging programmes
• In addition, the identification of HS2 as an England only scheme would be fair, appropriate and provide a mechanism for addressing some of funding issues via Barnett.  Furthermore, the opportunity to reallocate UK contributions to the EU Trans-European network to cross border connections within the UK should also be explored
• On this basis and within the context of previous WG statement and publications on this matter, my connectivity priorities are:
• Figure 1 A substantive upgrade of the SWML (line speeds, capacity & electrification) to enable a mix of intercity express and all stop local commuter services and new stations.  This strategic backbone would also importantly extend the reach of the UK intercity rail network through efficient interchange with local tram-train, rail and bus measures which also need support and funding. These include:
• Cardiff Crossrail - especially the section from Central via the Bay to the SWML at Rover Way which could actually support some SWML tram-train services
• Swansea Bay Urban area metro
• Ebbw Valley & Marches Line enhancements 
• In this context, the need for more capacity and services between Bristol Temple Meads-Cardiff-Swansea-West Wales has been presented on numerous occasions and would help secure “cross-border” economic benefits.
• Figure 2  A substantive upgrade of the NWML (line speeds, capacity & electrification) to enable a mix of intercity express and all stop local commuter services. Again, the local commuter services would enable new stations and provide interchanges to local bus networks at key hubs along the entire NWML. 
• The issues related to capacity through Chester and the long-term plans for HS2 and NPR vis-à-vis operation into NWML also need to be considered; exploration of operating HR services to Caernarfon should also be tested
• The vital opportunity to enhance the local cross border economy and reduce car dependency can be assisted through a strategic upgrade of the Borderlands line to deliver direct services from the Wrexham-Bidston line into Liverpool.
• These proposals support a number of major economic development interventions (as referenced in the recent WG publications) that can help secure wider economic benefits from investment in transport. This is the concept behind the South Wales, Swansea Bay and North Wales ‘Metro’ plans and the SEWTC’s recent proposals in respect of the M4 corridor.
• As you will be aware, WG is progressing with major scheme and business case development programmes for all of the above and these go much further than the more narrowly focussed work currently being progressed by NR via a remit from the DfT, which I view as being strategically compromised.
• Finally, Figure 3 I think (as others have concluded – including Greengauge 21) that plans for HS2 and its future expansion need to see the development of an “X” rather than a “Y” network; this can complement a more holistic plan for Wales that would also see an upgrade to the Marches line and a review of innovative opportunities in the west of the country (as I described in my 2019 blog)

6 January 2021

Figure 1 SWML Corridor Priorities (from recent WG publication)

Figure 2 NWML Corridor Priorities (from recent WG publication)

Figure 3 Long term strategic opportunities Welsh Rail network

Mark Barry is Professor of Practice in Connectivity at Cardiff University’s School of Geography and Planning. Mark also has his own consulting business M&G Barry Consulting. He led South Wales Metro Development for Welsh Government from December 2013 to January 2016 following the publication of his Metro Impact Study in 2013.