Department for Transport Annual Report and Accounts 2018-19

Annual Report and Accounts 2018 –19 Department for Transport Annual Report and Accounts 2018-19 (For the year ended 31 March 2019) Accounts presented to the House of Commons pursuant to Section 6(4) of the Government Resources and Accounts Act 2000 Annual Report presented to the House of Commons by Command of Her Majesty Ordered by the House of Commons to be printed on 18 July 2019 HC2392 This is part of a series of departmental publications which, along with the Main Estimates 2018-19 and the document Public Expenditure: Statistical Analyses 2018, present the Government’s outturn for 2018-19 and planned expenditure for 2019-20. © Crown copyright 2019 This publication is licensed under the terms of the Open Government Licence v3.0 except where otherwise stated. To view this licence, visit nationalarchives.gov.uk/doc/open-government-licence/version/3. Where we have identified any third party copyright information you will need to obtain permission from the copyright holders concerned. This publication is available at www.gov.uk/official-documents. ISBN 978-1-5286-1498-6 CCS0619441620 07/19 Printed on paper containing 75% recycled fibre content minimum Printed in the UK by the APS Group on behalf of the Controller of Her Majesty’s Stationery Office 2 Contents Foreword by the Secretary of State 5 The Accountability Report 88 Foreword by the Permanent Secretary 7 Report from the Lead Non-Executive The Performance Report 8 Board Member 91 Overview: How we have performed 10 Corporate Governance Report 93 Our purpose 10 Directors’ Report 94 How we are organised 11 Statement of Principal Accounting Officer’s Responsibilities 102 Our vision 13 The Governance Statement 104 Our strategy 14 Our governance 15 People and Remuneration Report 131 Our risks 16 Our People 132 Our performance-at-a-glance 16 Remuneration 138 Financial Overview: Director General Parliamentary Accountability and Audit Report 155 Resources and Strategy 24 Statement of Parliamentary Supply 156 Performance Analysis 33 Parliamentary accountability disclosures 165 Support the creation of a stronger, cleaner, The Certificate and Report of the Comptroller and more productive economy 34 Auditor General to the House of Commons 172 Help to connect people and places, balancing investment across the country 44 Financial Statements 176 Make journeys easier, modern and reliable 52 Group statement of comprehensive net expenditure 178 Make sure transport is safe, secure and sustainable 58 Group statement of financial position 179 Prepare the transport system for technological Group statement of cash flows 180 progress and a prosperous future outside the EU 64 Group statement of changes in taxpayers’ equity 182 Promote a culture of efficiency and productivity in Statement of changes in taxpayers’ equity 184 everything we do 67 Notes to the financial statements 186 Single Departmental Plan indicators 72 Sustainability Report 77 Annexes 269 A: Glossary of financial terms 269 B: DfT’s Financial Reporting Landscape 271 4 Foreword Secretary of State for Transport Rt Hon Chris Grayling MP 2018-19 was another exceptionally busy year for the The rail timetable problems in particular convinced me Department for Transport (DfT) and our agencies. We secured that the time has come to tackle the disconnect that exists Parliament’s backing for expansion at Heathrow more than between different parts of the rail industry. Although rail five decades after it was first proposed by Government. We privatisation has delivered two decades of growth, I have embraced new technologies and smarter travel by launching long thought that the industry remains too fragmented to our Future of Mobility strategy, and spearheaded a brilliant address performance issues and provide the consistently Year of Engineering campaign to promote the benefits of an reliable services that passengers deserve. That is why I asked engineering career to young people. We developed long- ex-British Airways executive Keith Williams to lead a thorough term visions for aviation and maritime, looking ahead to 2050 appraisal of our railway. I wanted a fresh perspective on how and beyond. And we continued rolling out our ambitious we might realign the industry to provide common incentives, investment programme to renew Britain’s roads and railways. clear accountability, and a singular emphasis on the customer. When Keith reports back this autumn, we will use his findings To illustrate the scale of that commitment, we embarked on and proposals as a catalyst for rail reform. a five-year, £48 billion plan to maintain and modernise the railway, and in the Budget, we announced that Vehicle Excise Preparations for a possible no-deal EU Exit were high among Duty (VED) would henceforth be ring-fenced for road repairs Whitehall’s priorities throughout the year, but they had a in England, providing £28.8 billion between 2020 and 2025, a particularly big impact on the Department, requiring the laying 40% increase over the current five year period. of 60 separate Statutory Instruments. Although this stretched the resources of the Department, civil servants responded The benefits of sustained investment were much in evidence with typical professionalism and diligence, providing crucial over the past year. Brand new train fleets were introduced on advice and helping to reassure industry and the travelling the East Coast and Thameslink lines. Passengers were able public at a time of inevitable uncertainty. to appreciate the stunning transformation of London Bridge Station. And the biggest upgrade of Liverpool Lime Street For many years we have been discussing transport of the since the 19th century was just one highlight of the Great future. Now it’s becoming a reality, as the past 12 months North Rail Project, which by 2022 will enable an extra 2,000 have shown. To help make this country one of the best extra train services a week to run across the North. places in the world to own and manufacture electric vehicles, we hosted the first ever Zero Emission Vehicle Summit in We also opened smart motorways on the M6, M5, M1 and Birmingham, where global governments signed a commitment M20, and set out strategic road studies to transform key to create a cleaner future. We launched our Road to Zero routes around the country, such as across the Pennines, on clean motoring strategy, which sets out new measures to the south west quadrant of the M25, and between Oxford clean up road transport and lead the world in the developing, and Cambridge. We announced winners of the £2.5 billion manufacturing and using zero emission road vehicles. Transforming Cities Fund to boost sustainable urban travel, and launched an Inclusive Transport Strategy with the aim I was very sorry to lose three excellent ministers during the that everyone should be able to use the transport network year – Baroness Sugg, Jesse Norman and Jo Johnson - who easily and accessibly, regardless of disability. all made a very positive impact at the Department. But I was delighted to welcome in their place Baroness Vere, Michael However, 2018 also brought challenges. There was Ellis, and for his second term at the Department, Andrew widespread disruption on the railway during the spring and Jones. As for me, in July this year I celebrated my third summer following the introduction of a new timetable. The anniversary as Transport Secretary, something that only two failure of the Virgin East Coast rail franchise required the previous Secretaries of State have achieved since the position Government to step in and run operations from June 2018. was first created in the 1970s. It remains the most stimulating And the drone attack on Gatwick Airport in the week before and rewarding job I’ve had in government, and I consider Christmas was cynically designed to upset passengers’ travel myself fortunate to head up such a talented and dedicated plans at one of the busiest times of year. We learnt from all Department. three events, and emerged better equipped to deal with similar situations in the future. 5 6 Foreword Permanent Secretary Bernadette Kelly CB The last year has been eventful, with a number of our biggest Internally, we have seen improvements in audit assurance rail projects – including Thameslink, the InterCity Express and freedom of information; introduced a new performance Programme, and electrification of the Great Western line management system; and recognised some great team and – reaching their final stages. Whilst passengers are now individual achievements through our Vision for Action awards. experiencing the benefits of new trains, better services and In our People Survey, our overall engagement score remained much needed additional capacity as a result, there have been level at 64%, and we continue to enjoy some of the highest problems as well, extensive disruption following timetable scores in Government on learning and development and changes in May 2018 and delays to the completion of Crossrail. fairness and inclusion. In response to these, I commissioned a review jointly with the Improving skills and capability remains a priority, including Infrastructure and Projects Authority (IPA) which resulted in through the work we have led with industry partners on the publication of a report, ‘Lessons from Transport for the Transport Infrastructure Skills Strategy and the highly Sponsorship of Major Projects’ in April 2019. This sets out 24 successful Year of Engineering, which culminated in a joint key lessons for the successful delivery of major projects, which ceremony with the Institution of Civil Engineers at Westminster are now being embedded in all of the Department’s most critical Abbey on 22 November 2018. Within the Department, we have programmes including High Speed 2 (HS2), the Transpennine focused on developing core skills in priority areas including Route Upgrade and the A303 Stonehenge Tunnel. commercial, digital and project delivery, as well as developing our leadership and management capability.

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