Government backs down on Network Rail cash raid (Transport Network)
The Government has backtracked over a threat to put £1.8bn from a sale of Network Rail assets towards cutting the deficit. However, the infrastructure operator could still be forced to cut maintenance work and drop planned upgrade works because of a funding shortfall.
As Transport Network reported earlier this month, the Network Rail board was told in September that ‘HMT were now requiring the proceeds of the asset disposals programme to count to deficit reduction thus handicapping NR’s use of the cash to fund rail enhancement schemes’.
However, a spokesperson for the Department for Transport told Transport Network: ‘Network Rail is continuing to sell assets to generate more funding for the Railway Upgrade Plan. These proceeds will not be used to pay off the deficit.’
It remains unclear how much progress the rail infrastructure operator has made in raising the £1.8bn that the 2015 Hendy review identified should be secured by the sale of ‘non-core assets’ to fill the majority of a £2.5bn black hole in funding towards works in Control Period 5, which runs until 2019.