Often, in rail, the only allowed delivery route is central government funding. This places rail schemes in direct competition with funding needs from other sectors, making rail a more politicised issue than needed. There are a wide variety of other options, including private finance and even private funding sources, which need to be harnessed to meet UK’s needs. The UK should be looking to other countries where private investment has been successful, to explore how the benefits can be maximised in the UK rail sector.
The benefits of unlocking private investment could be significant: additional funding, greater long-term certainty, the introduction of market discipline (sharing the risk of cost overruns), and bringing forward the benefits of schemes earlier. To do this, Government needs to develop standardised approaches for investing in rail schemes, with intelligent market engagement and a balanced approach when comparing private finance with public borrowing.