Safety, reliability, capacity and cost

“That pre-job planning is absolutely critical to a successful job,” he says. “It means you do the job efficiently, it means you have the right number of people you need and only the right number of people you need. You don’t flood the job with people who are standing around looking at it - you just bring the people you need who do the job.”

Carne is not the first CEO from whom I’ve heard similar sentiments, and only time will tell if he is the first to make a major impact on NR’s seeming addiction to late re-scoping in particular. He has certainly planned this conversation in advance, and when I ask what surprises he’s had since taking over the job, he politely reminds me that he hasn’t finished his previous point.

“Can I go back to the four priorities I talked about earlier, because I want to come back to that if I may?”

Oops. Indeed he can…

“Because my other three priorities are really important in the context of what we have to achieve in the next five years. We know that passenger satisfaction is driven to a very large extent by reliability, and in CP4 we did not deliver on the levels of reliability required of us. So that has to be an absolute focus in the next few years - to deliver a more reliable railway.

“Part of that is about improving the weather resilience of the railway, given the impacts of climate change we’ve seen.

“But we also just need to make the underlying assets not fail so frequently. We must improve maintenance techniques through risk-based maintenance and the improvement of our asset monitoring techniques. That way we can focus on those areas where we can deliver better reliability. These are the kind of things that we need a more systematic and structured approach to, in order to drive greater reliability.”

In the past few years, the railway has made great strides in adopting better technology - but it’s still falling short, according to Carne.

“We need to bring better technology in, so a state-of-the-art traffic management system is an essential part of improving the way in which we are able to run the network. This applies in particular when we have had an upset to the service: how do we best recover that service as quickly as possible? Traffic management systems will enable us to do that far more quickly than we are able to at the moment.

“We also know that if we want to improve reliability we have to develop better timetables - so we have to work more closely with the train operating companies to create more resilient timetables.

“Procedures are sadly lacking. If you want to go and do a major bit of work and you have a three-hour possession, and it takes you an hour to start up and an hour to shut down, it’s a very inefficient way of working. So we need to have longer working times.”

So more blockades?

“Not necessarily full-term blockade work, but certainly longer possessions that enable us to dramatically improve efficiency - so our relationships with TOCs is absolutely critical.

“So there is a lot to do. But I think we have a very good plan and if we execute that plan effectively then we will really see improvements.

“This industry was structured at privatisation with managed decline in mind, yet it has doubled BR’s passenger business to 1.6 billion - that is extraordinary. And this great success story is expected to continue, with growth of 3%-5% generally and in some areas even more.

“So how can we continue to create more capacity on the railway, when it’s very difficult to build more tracks or more platforms? This is why we are starting to see the rollout of ERTMS - we will see it on Thameslink, we are going to see its development on Great Western and the start of London North East in the next five years. This is key to the future of the railway, and we’ll come back to this.

“For now, I want to finish my point and discuss my fourth element: cost. NR doesn’t set fares, but we are responsible for about half the cost of the railway, so we have a huge impact on what the ticket price policy ultimately is. 

“We must do everything we can to drive down costs, but I am NOT here to slash and burn and cut costs, I’m here to drive efficiency, because that is how we will really deliver better performance for the entire railway. We just need to do the right things and do it once, and we will really make a step change in cost.

“So, in summary, those four priorities - safety, reliability, capacity and cost - are central to my approach. I’m convinced we need to create a culture in NR where safety and performance are truly seen and managed together, with continuous improvement and relentless ambition to be better every day. That must become part and parcel of the way we work.

“We are lucky that we work in an industry where some train operators have done a lot of really good work already on that continuous improvement approach, in the way they manage their trains and reliability. There are things NR can learn even from within our own industry. I am very excited about the opportunity that affords.”

Given Carne’s focus on asset management, I remind him that immediately after privatisation in the mid-1990s, the mood music emanating from Railtrack’s top management was that the company was really a property business. The word ‘engineering’ did not even appear anywhere in the lift floor labels.

One of the first post-privatisation moves by Railtrack was to scrap its ultrasonic test train, leaving the company with only hand-held equipment to test the rails on the 11,000-mile network. The tragic outcome was the shattering of the flawed rail at Hatfield into 300 pieces, leading to four deaths and the industry’s ‘nervous breakdown’ from which it took a decade to fully recover.

“I just don’t subscribe to that!” says Carne with great emphasis. “Yes, we have a property part of our business which is very important, and the way we manage stations and create new kinds of opportunities for customers at stations is very important. But we are first and foremost an engineering and operations company. We are an asset integrity company, and THAT is what needs to drive us.”

Back in those days, commentators were arguing this point. One of the most vocal critics of Railtrack’s approach to asset management was Rail Regulator Tom Winsor, who was relentless in his criticism of Railtrack’s asset knowledge. Where do we stand on that now?

“We are in a dramatically different place than we were a decade ago,” Carne replies. “We now have a very good understanding of our assets. We know what assets we have, and we have a good understanding of their health and their maintenance needs. But it’s also an area where technology continues to move on all the time - we need to be at the forefront of using that technology to help us manage those assets more smartly.

“And it’s not just about the track. Another highly challenging area for us is our earthworks. We have 37,000 miles of earthworks and embankments - most of these were built 150 years ago, and they are now being exposed to higher levels of loading and more extreme weather.

“We can’t rebuild all these embankments - that would be a task beyond our capability and scope - so what we have to do now is monitor and measure their performance and predict when they are likely to fail. We can then intervene ahead of time - it’s this predictive way of working that we need to urgently move to, rather than just patching up when things have gone wrong.”

Anecdotally, I’m told that in BR’s last 20 years, drainage maintenance (in particular) was neglected to cut costs?

“Yes, I think there’s plenty of evidence to support the conclusion that there was quite a lot of under investment in the basic maintenance of our civil assets, and we are now playing catch-up.”

A failure here could be catastrophic, and the signs are not good. We have seen increasing numbers of landslips - many minor, but some with serious consequences.

There was the Scottish landslip between Corrour and Tulloch in June 2012, which resulted in a Class 66 on a freight train plunging down the slope to Loch Treig.

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