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Investing in the Future Choices for Scotland’S Railways 2019 and Beyond

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Investing in the Future Choices for Scotland’S Railways 2019 and Beyond Investing in the Future Choices for Scotland’s Railways 2019 and beyond September 2016 Contents Foreword 03 01: Supporting Scotland’s Success 04 02: Industry Background 05 03: The Railway in 2019 07 04: A Vision for Scotland’s Railway 09 05: Turning a Vision into a Strategy 11 06: Future Challenges 16 07: A Railway Fit for the Future 20 08: Investment Choices and Options 23 Foreword Scotland’s railway is continuing to develop and expand. A major programme of The document also sets out a number of areas that the industry will explore more investment – funded by the Scottish Government – will be delivered between fully in the IIA and work with government to support its strategic priorities. This now and 2019. will inform Ministers’ High Level Output Specification as well as their development of policies. These include: This investment in both infrastructure and rolling stock, building on the success of both the Borders Railway and Airdrie-Bathgate projects, will permit passenger • Identifying opportunities for development and investment in areas and services to be significantly improved across Scotland in the coming years. The markets where rail is best placed to support overarching government market for rail in Scotland that has grown significantly: passenger rail demand in outcomes Scotland has doubled over the last 20 years and although there is uncertainty Prioritising investment in those markets where rail has the potential to about future demand, current forecasts reinforce the need for continued • increase its market share significantly investment. Taking advantage of Network Rail’s programme of renewals to minimise the Meanwhile, the rail freight market is continuing to adjust to significantly changing • cost of rail enhancement proposals market conditions, with growth in containerised traffic partially offsetting the sharp decline in coal traffic. Ensuring that this adjustment in freight markets can • Identifying potential constraints and trade-offs that are likely to exist on the be accommodated is a priority for both freight operators and Network Rail, as network they are important for supporting sustainable economic growth in Scotland. • Aligning strategic choices in an ongoing planning framework that delivers The railway in Scotland faces significant challenges. Supporting the Scottish affordable outcomes and makes best use of resources Government’s priorities for economic growth and development is essential to Preparing for likely developments in cross-border services following the provide a prosperous and sustainable future for Scotland. The industry has to • opening of HS2. demonstrate that it is making best use of the resources available to it, as well as developing its approach to reflect innovation, best practice and partnering with The key to delivering a strong, deliverable rail strategy will be for both the government and stakeholders to optimise the use and development of the Scottish Government and the rail industry to build upon the collaborative system. This should be underpinned by an approach which puts the needs of approach that already exists in Scotland, most recently demonstrated by the passengers and freight shippers at the heart of the industry, building on the work Scotland Route Study. already underway to better understand the needs of customers. Scotland’s railway is well-placed to contribute to both internal and cross-border The aim of this document is to support the Scottish Government and other markets. Setting out a long-term context for managing and developing the funders in making decisions around the future of the railway. It recognises that network will enable their potential to be realised and continued success to be there are ongoing changes and challenges to the industry, not least around achieved. project development and delivery, and sets out how the rail industry is working together and with government to address these issues. The timing of the document reflects the industry’s ability to inform the development of the Scottish Government’s strategy and policy, and as such sets the scene for the Rail Delivery Group’s Initial Industry Advice (IIA) which is expected to be published in early 2017. Jo Kaye Chair, Planning Oversight Group, RDG The industry hopes that the document will be a starting point for discussions with Director, Network Strategy and Capacity Planning the Scottish Government and the public about the outcomes it wants the railway to support in the future and the trade-offs that will be required to achieve them in a way which is both affordable and which delivers strong value-for-money. Foreword Investing in the Future 03 Supporting Scotland’s success 01 Context An efficient transport network is essential in delivering a prosperous Scotland, supporting inclusive, sustainable growth across the country. The Scottish Government published its Economic Strategy in 2015, and is currently working to develop its infrastructure priorities for the future to make this vision a reality. The Scottish Government has announced its updated National Transport Strategy, which underpins its strategies and policies, including the High Level Output Specification (HLOS), for the rail industry. Taken together, these documents will set out how transport can contribute to delivering this vision, and what rail investments and outputs the Scottish Government intends to support to ensure that rail plays the role expected of it. This document sets out rail’s potential to support the Scottish Government in Taken together, these are designed to be a positive contribution to the developing its priorities. It sets out the issues that government and other development of rail policy in Scotland. The industry hopes that entering into stakeholders should consider in planning rail investment, and the implications informed and continuing dialogue will help to ensure that the Scottish that choices could have on the overall cost and affordability of the railway in Government’s investment plans are targeted towards meeting its broader Scotland, including options for funding the railway. economic, social and environmental objectives in an innovative and efficient way. It builds upon both the long-term planning already underway in the rail industry The industry recognises the financial constraints within which the Scottish and the broader policies the Scottish Government is pursuing and reflects the Government is working, and the impact that this will have on industry aspirations industry’s view on opportunities for the future, including the views of the national to maintain and develop Scotland’s rail network in the medium term. In setting supply-chain. out choices that put passengers, freight shippers, funders and the wider public interest at the centre of its approach, the railway is confident that it can Delivering the best outcomes for Scotland will require clarity and commonality of contribute to Scotland’s future. purpose across the industry. While recognising that the railway is a mature industry, there will be opportunities to deliver innovative solutions that improve services and reduce the costs of maintaining and expanding the network. Working together, the rail industry in Scotland will continue to engage and identify opportunities to deliver better outcomes for passengers, freight customers, funders and the wider community. The 2018 Periodic Review, principally focused on Network Rail, was started by the Office of Rail and Road (ORR) in May 2016. The Periodic Review process expects that Scottish Ministers will specify their high level outputs for the railway for the five years starting in April 2019 during 2017. The timing of this document is intended to provide the Scottish Government with a high level summary of the key issues facing the industry in Scotland, and to identify potential ways of addressing them in both the HLOS and its future strategies for rail. A more detailed Initial Industry Advice to Ministers is expected to be published in early 2017. This will build on and take forward issues raised here and provide further information and context to continue to inform decision making by Ministers, and integrate Scotland’s priorities with network-wide choices that will support this process. Chapter 1: Supporting Scotland’s success Investing in the Future 04 02 Industry Background Supporting Scotland’s economy Case Study : Developing the wider economy Scotland’s rail network plays an important role in supporting the economic and social activity of the nation. Passengers and freight users benefit directly from its Borders Railway services, and a well-functioning network is essential to support and complement The objective of the Borders Railway Project was to improve access to Edinburgh and other modes of transport. Rail services connect people and businesses to jobs, other important regional markets for people living in the Scottish Borders and Midlothian. education, communities and leisure opportunities; rail freight connects This was particularly important, because the Scottish Borders suffer from high levels of businesses to their customers and supports the Scottish economy. A recent underemployment whilst labour market constraints have been identified as a barrier to report by Oxera estimated the economic value of Scotland’s railway to the nation Edinburgh’s continued economic success. Access to Edinburgh from the south is obstructed by the Lammermuir and Pentland Hills, and the main trunk road connecting (in terms of Gross Value Added) at £670m in 20161. the key Borders towns
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