Network Rail promises answers to supply chain after communication concerns raised

Members of Network Rail’s supply chain are waiting to hear how it will improve communication after voicing concerns about how information about spending is being shared. 

Representatives from small and medium-sized enterprises (SMEs) grilled NR’s Group Director, Railway Business Services, Clive Berrington, at the Railway Industry Association conference earlier this month. 

During the Q&A, Berrington said £9 billion out of NR’s £11bn annual spend goes on the supply chain, but admitted communication about more reactive work having to take place and fewer planned activities had not been good enough. 

Iain Court, Strategic Development Adviser at OLE Limited, said devolution within NR had led to ‘patchy experiences’ and a subsequent disconnect with the supply chain.

Speaking to RAIL, he said NR used to be “very good at outward facing” and hoped it would be again.  

On November 4, a call with hundreds of suppliers allowed some to raise concerns which Court, and enGauged Ltd’s Managing Director, Steve Whitmore, thought was a positive step. 

One of the issues SME representatives want clarity on is where the money earmarked for the supply chain currently sits. 

Whitmore said firms are reliant on work from larger tier 1 contractors, but need to know where the money is going so SMEs can budget. 

Catherine Leech, Managing Director of Anturas Consulting, said SMEs were getting “none” of the £9bn earmarked for the supply chain. 

“For months things have been really difficult in the rail sector for work. Then CP7 (control period 7) started being promoted as going to start spending. The supply chain not seeing any of it,” she told RAIL, adding: “We’ve got to know where is the money and who has it.” 

Speaking later during the RIA conference, Network Rail Chief Executive said he was “really confident” of ‘resolving outstanding procurement issues in the next couple of months’. 

Replying to a question from Court about when spending is going to start so SMEs can help with next year’s work, Haines said NR had spent around £800 million more with the supply chain in the first half of this year than in the same period of CP6. 

Network Rail has admitted that supplier spend at the start of CP7 is lower than in the last year of CP6, but spend in the first half of the year so far is similar to the CP6 five-year average. 

A spokeswoman said: “Supplier spend does vary by asset and region, and we are continuing to see inflation and input price pressure, sometimes in higher-than-inflation unit rate increases. We are having to make our money go further, so some suppliers in some parts of the country are seeing lower volumes of work than they expected.” 

NR has vowed to improve communication and visibility of its pipeline. 

During the RIA Q&A, Berrington pledged to come back to SMEs within two weeks on CP7 frameworks, their value, and what has been spent so far.