Rural Economy and Connectivity Committee

Meeting date: Wednesday, May 17, 2017

Official Report 521KB pdf

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Rail Infrastructure (High-level Output Specification)

Good morning and welcome to the 16th meeting in 2017 of the Rural Economy and Connectivity Committee. I remind everyone to ensure that their mobile phones are turned to silent. Apologies have been received from Fulton MacGregor and Jamie Greene. Jamie will be joining us at 10 o’clock; I think that he has had some problems with transport. No doubt, like everyone else this morning, he is walking to work, as today is walk day Wednesday.

Agenda item 1 is an update from the Scottish Government on the high-level output specification strategy for rail infrastructure in Scotland. I welcome Humza Yousaf, Minister for Transport and the Islands; Bill Reeve, director of rail at Transport Scotland; and John Provan, head of rail strategy and funding at the Scottish Government.

Mr Yousaf will make an opening statement.

Thank you, convener. I confirm that I walked to work this morning.

Publication of a high-level output specification is a regulatory requirement under United Kingdom railway law. This HLOS sets out our day-to-day requirements for the Scottish rail network for 2019 to 2024 and how we plan to address future capacity constraints. It is accompanied by a statement of funds available, which outlines the level of public funding available to support our requirements.

Although the HLOS is part of a regulatory process, it enables us to provide renewed focus on a high-performing, resilient rail network in Scotland, and gives us the opportunity to challenge the rail industry to deliver improved benefits for passengers and freight customers.

Development work on the HLOS is at an advanced stage. We have consulted extensively with the public and the Scottish rail industry, and have received well over 100 responses to our future infrastructure strategy consultation. Based on that and our experience of the current and previous railway control periods, the HLOS will have a particular focus on maintaining the current high levels of performance, which are among the best across the UK railway; improving journey times and connectivity for passengers and freight users; continued growth in the rail freight sector; and improving rail’s green credentials.

The HLOS will drive positive behaviours across the Scottish rail industry. It primarily lays out our expectations of Network Rail, but it will also ensure that Network Rail pulls together in alignment with the wider rail industry, with a clear focus on delivering our priorities for Scotland’s railways.

Since 2007, we have made considerable investment in Scotland’s railways, with new lines such as the Borders railway and the Airdrie to Bathgate line, and new stations such as Laurencekirk station and many others. That investment continues with the Edinburgh to Glasgow improvement programme, the redevelopment of Queen Street station and other major projects in our £3.5 billion capital investment programme to 2019.

It is no secret that there have been significant challenges with the cost and the delivery timescales of some of our major rail projects. We have been working with the rail industry in Scotland and the regulator—the Office of Rail and Road—to help manage those projects more effectively. We have also challenged the industry in areas where there has been a clear need for improvement. The result of that work is there for all to see: we have not cancelled or deferred any of our committed schemes; any delays to projects are measured in months rather than years; and we remain within the financial headroom that is set by Her Majesty’s Treasury. That is a considerably different picture from that in other parts of the UK railway. The picture is not where we want it to be, but it is considerably better than it was.

However, we cannot have a repeat of project overruns in the next control period, particularly at a time when public finances are under unprecedented pressure. That is why the HLOS will signal a move towards a pipeline approach to the delivery of major capital schemes—a move that was supported by 63 per cent of respondents to our consultation. That approach will bring significant improvement in project specification, development and governance. Importantly, it will also provide greater oversight and discipline around the cost and the delivery timescales of such projects.

The timescales for the publication of the HLOS have, of course, been affected by the UK general election, as we will require certainty from the Treasury on the future funding arrangements for railways. Nevertheless, we are working towards meeting the statutory deadline set by the ORR of publication by no later than 20 July. The details of the pipeline approach will be set out in our future rail enhancement and capital investment strategy, which will be published by the end of 2017.

As always, convener, I am happy to take questions from the committee.

The first question is from Stewart Stevenson.

Before starting, I declare that I am the honorary president of the Scottish Association for Public Transport and an honorary vice-president of Railfuture UK, both of which roles are relevant to the subjects before us.

Thank you for reminding me about declarations of interests, Stewart. Do any other members want to make a declaration before we go any further?

I am an honorary vice-president of the Friends of the Far North Line.

I am co-convener of the Scottish Parliament’s cross-party group on rail.

I, too, am an honorary vice-president of the Friends of the Far North Line.

That seems to conclude the declarations. Please continue, Stewart.

I am sure that the minister is well aware of the keen interest in this matter in this committee and elsewhere. I have three questions, each of which is on a different subject. First, how does the HLOS tie in with wider policies and practice for transport in Scotland, given that railways do not stand apart from other modes of transport?

The integration of modes of transport is hugely important. The HLOS specifies the high-level expectation of performance, which can include journey-time improvements, as well as improvements to the passenger experience. Stewart Stevenson is right to point out that a key part of improving the passenger experience is the integration of transport. People who take the ferry service from Ardrossan to Brodick on Arran, for example, often use the railway to get to Ardrossan. Transport integration is important, therefore, but the HLOS is set at a very high level, which is where some of the conversation around performance takes place. The public performance measure is a good measure, but we could look to supplement and complement it. When it comes to other forms of transport, we will look at how to improve the passenger experience; part of that might be about how we can better integrate modes of transport.

You referred to the integration of ferries and railways, but the majority of ferries are controlled by the Government, so I suppose that both sides of integration are largely in your hands. However, in the case of buses, cars, walking and cycling, integration is fundamentally more difficult. Do you have anything useful to say about how the HLOS might support a wider strategy in relation to those modes of transport?

Yes, the HLOS could do that. However, it is important to mention that, to improve transport integration, the franchise agreement requires the train operating company, ScotRail, to work with Transport Scotland and other stakeholders, such as regional transport partnerships; local authorities; ferry, subway, tram and airport operators; and taxi associations. That includes delivering integrated ticketing, which is a huge piece of work that is being taken forward with local authorities and bus companies. For example, funding of £200,000 has been made available to ScotRail to work with the wider transport integration group. Projects that are being delivered include wayfinding and multimodal screens at Oban, Elgin, Inverness and Thurso. A lot is therefore going on to integrate modes of transport. The HLOS will set the high-level specifications, but the franchise agreement already compels ScotRail to work with others to improve transport integration.

My colleague Rhoda Grant will come back to that issue in more detail. I move on to the responses to the consultation. In your preliminary remarks, you highlighted that there was broad agreement on the pipeline approach in the consultation. How will you respond to other areas that arose in the consultation?

We were really pleased with the level of response; we were also really pleased to actually go out to various communities. In fact, MSPs got in touch with me to say that they wanted us to come to their constituency if they thought that we were not going to do so. We did our best to go out as much as possible, so my first point is that I am pleased with the level of engagement.

On the 114 consultation responses that we received, there was, as you say, large agreement on the pipeline approach. Seventy-two per cent of respondents also agreed on our vision for rail, which I was pleased about.

We are further examining how we can include climate change in the HLOS, on which there is work to do. There is clear, strong support for rail being included in the emissions reduction targets that we set.

It was also clear that the industry felt that governance and transparency were issues, so there is some work for us to explore in that regard. I have mentioned in public our frustrations with governance and transparency around major projects—they have been well rehearsed with the committee. That is why we want to move toward the pipeline approach.

There was also clear support for ensuring that rail freight was part of the conversation. In fact, there were ambitious targets for rail freight. We will also consider that area in the HLOS.

For my part, I am easily pleased: progress on the Buchan link, perhaps to Ellon first and then on to Peterhead and Fraserburgh, will keep me well chuffed for the next while. However, there will be competition.

Speaking of competition, the Government has made substantial commitments to invest in the dualling of trunk roads. In your opening remarks, you referred to increasingly restricted access to capital. How do you think that that focus on trunk road investments will play out against much-needed investments in rail?

As a minister, I have to find that balance, and I think people understand that. The figures in the Transport Scotland 2017-18 budget show that £748 million is to be spent on rail and £823.3 million on motorways and trunk roads. About 4 per cent of commuter journeys are done by rail and 66 per cent are done by car or van. We are spending considerably on rail to encourage a modal shift from the road to rail, but that does not mean that we stop investing in our trunk roads.

This and other committees have noted the Audit Scotland report on the condition of our trunk roads. Although they might be in a better state than local roads, they still need some attention, as the Audit Scotland report rightly says. We cannot take our eye off maintaining our current assets, and we must add to them where necessary. The dualling of the A9 and the A96 will be of huge benefit. To have all our cities connected by trunk roads will be good for our economic growth and will tackle many other issues along the way. It is about finding a balance.

During the consultation, several respondents raised concerns that capacity improvements appeared to be focused on the existing network, rather than on reopening some of the old lines, such as the line to St. Andrews and the line north of Aberdeen to Ellon and Peterhead. I would welcome your comments on that. Are there any plans to reopen some of the lines that were closed several decades ago?

09:45  

Only yesterday I was reflecting that it has been a year since I was appointed to my role. I have met a number of campaigners who are dedicated and passionate about the railway in their local community. They sometimes get a bit of a bad press, which is unfair, but they are real rail enthusiasts. They have such energy—some of them have dedicated their lives to seeing certain lines reopen, such as those that Peter Chapman mentioned.

Again, there must be a balance. It is important that we strengthen and renew existing assets. At the same time, we should not be closed to investing in new lines. We have a good track record in and have shown a commitment to opening new lines. The Airdrie to Bathgate rail link was completed in 2010 and the Borders line was completed in 2015, for example, and we have opened 14 new stations since 2007.

Campaign groups will be incredibly interested in their rail projects, but I make it clear that they will not see in the HLOS the detail of every single project that we are funding in the control period—it is high level by name and by nature. I am keen to avoid having a prescriptive list of early and unrealistic cost estimates, only for Network Rail to say in three years’ time that the costs have doubled, tripled or quadrupled. I am keen to have a pipeline of projects—some of them have been mentioned. Once we are satisfied that there is a robust business case that has been developed to, say, stage 3 or 4 of the governance for railway investment projects process, we will start to release funds, because we will have a better idea of the cost.

The projects that Peter Chapman mentioned have all come across my desk, and we would not discount them from that flexible pipeline approach. I hope that my answer gives him reassurance.

It does a wee bit, but that work is obviously quite a bit down the line, if you will pardon the pun.

How do you intend to balance value for money between the taxpayer and the fare payer? Do you intend that the fare payer will fund a greater proportion of rail operating costs in Scotland?

The short answer is no. We have taken action on fares, and I am proud of that. For example, the majority of fares do not increase above the retail prices index and off-peak regulated fares can increase only by 1 per cent below RPI. Of course, no one travelling on the railways wants their fares to increase but, if they are to increase, at least any increases are capped in Scotland. We have also introduced various initiatives such as the free week, which many passengers claimed this month. We do not expect the cost burden to be placed on fare-paying customers.

Some projects are obviously missing from the pipeline, such as the Glasgow crossrail project. In my constituency, the Kyle line could be shared by road and rail. How do we and local campaigners know what projects are under consideration? With such a flexible pipeline, how do people know what will happen, where a project will feed in and when it will become a priority?

That is a good question. I hope that the flexible pipeline approach shows that we will not discount any projects. If we had a prescriptive list of X, Y and Z projects, there would be certainty that other projects could not get in. With such a list, we would have to be rigid and narrow, whereas the flexible pipeline approach essentially means that there are a number of projects to consider and we should not discount any of them. When it comes to making the final decision on whether to fund them, they will have to go through a process.

On the project that Rhoda Grant mentioned, my advice would be to follow the advice of many campaign groups: get the stakeholders together—usually, that would be the regional transport partnership and the local authorities that are involved—work with Transport Scotland on the Scottish transport appraisal guidance process and get the business case worked up. We can only do so much but Transport Scotland is happy to help where it can to guide campaign groups through that process.

My only point about the pipeline approach is that we want certainty about the robustness of any business case plus as much certainty as we can get about the cost, so that we know how much we will have to commit.

There has been a problem with the Kyle line and the Stromeferry bypass pretty much all my life. People who are looking at road and rail sharing the line as a possible solution to the problem may work up a proposal but if that then falls way down the list of priorities, it is difficult to put a timeline on when the road will become safe again. Is there a way of prioritising urgent cases in which something needs to happen quite quickly?

Rhoda Grant is right to highlight that point, because there is a limited pot of funding. I might come on to the statement of funds and how much is available later, but we clearly have limited funding and a debt ceiling that we cannot go over, so there will have to some prioritisation. However, the STAG process can help to make the case for a project because it looks at not only the robustness of the business case but whether the area is remote or isolated and whether the project will help the socioeconomic conditions in that area.

I do not know the intricacies of the line that Rhoda Grant mentioned, but if Transport Scotland can provide further guidance on how to make a case in line with the STAG process, we would be happy to do that.

Okay. I will move on to my substantive question, which is about the integration of forms of transport and follows on from Stewart Stevenson’s questions.

The Government is involved in the Mallaig line. The ferry comes in 20 minutes after the train leaves Mallaig, and it should be in Transport Scotland’s gift to do something about places where people depend on privately operated bus companies waiting on the ferries coming in. The same is true of integrating bus and train services—the issue mostly affects bus and train services, including some local bus services, in my region. How can transport be made more integrated? How can we help people in the area, especially tourists, to travel around? Also, sometimes when subsidised bus contracts are lost, add-on services are also lost. The whole system seems relatively chaotic.

I have had a lot of correspondence about the Mallaig to Armadale route with those involved, including the Sleat transport forum and many others, and I share a lot of the frustrations. We are looking for solutions that will allow better integration of transport.

I asked ScotRail about the issue. I was taken into its control room in Glasgow and shown how altering one train by a few minutes could impact on journey times over the entire network, even in parts of it that are not connected to the service in question. The solution might seem fairly simple, and I respect the reason why Rhoda Grant asked the question, but changing things can have an undesirable effect on the rest of the network. I agree with the overall thrust of the question, however. Integration of transport is a vital part of the work that Transport Scotland and I do.

Integrated or smart ticketing is an important part of that agenda. The ability to use one ticket on multiple modes of transport will help with integration and will force some of the commercial operators to talk to the likes of ScotRail and CalMac.

That conversation is taking place, but I urge members to contact me if there are specific areas in their constituency where integration between the various modes of transport could be improved, and I will certainly sit down and speak to the relevant transport providers and we will try to work up a solution as best we can. However, as I said, sometimes the solution that might seem obvious can have a detrimental impact on the rest of the network. If that is the case, I will be up front with members and say that that is why something cannot be done.

The issue is a huge frustration for commuters and passengers, and I am happy to see what more we can do to mitigate some of the negative effects.

I understand that rail times are difficult and that there are knock-on effects. However, surely ferry timetables, which are in the gift of the Government, through Transport Scotland, and, indeed, the ferry companies, could relatively easily be changed by a matter of minutes to allow connections to happen. It is really frustrating for people to have a very long journey that could dovetail much better.

When we make changes to summer and winter ferry timetables, we consult local communities extensively. We engage with the ferry user groups on the islands in particular but also with groups on the mainland. We do a lot of consultation. It is also unfair to suggest that CalMac does not have restrictions: it has to deal with crew numbers and their working and rest hours.

My offer in relation to adjustments and when they can be made is genuine. If Rhoda Grant thinks that tweaking a timetable by a couple of minutes could make a huge difference to the people whom she represents, I would be happy to look into that. However, there may be very good reasons why certain things cannot be done.

CalMac is not in the business of trying to be unhelpful. It is a very helpful company. It looks to engage and has a community engagement director, Brian Fulton, who meets communities to have conversations with them. If there is something that we can do, I would be open minded about considering it.

I am sure that you will get lots of letters not only from members but from the public, who are trying to ensure that services interconnect, as a result of that statement.

On the surface, that is a generous offer for people who get in touch, minister. However, surely it is self-evident that a lot of planning goes into the timetables. It does not need concerned citizens from the Western Isles to explain that in some instances there is no co-ordination. It may be that there are limitations and that nothing can be done, but such situations should not have to be explained if a rigorous assessment was done before the timetables were compiled.

I go back to my previous answer. There is an extensive conversation with communities before the summer and winter timetables are published. Of course, it is not possible to keep everybody happy given the limited number of vessels that CalMac has. Some of the issues are well known and well documented in the public domain.

The popularity, accessibility and affordability of many of our islands as a result of the road-equivalent tariff and the great marketing that the islands have done is a good thing, but let us not pretend that it does not have challenges. Two vessels are being built at the moment at Ferguson’s shipyard but they will not come into service until 2018, so we have a limited number of ageing vessels, some of which are nearing the end of their shelf life. That means that we have constraints. We have to manage the network in the summer—it is a little bit easier in the winter—and cascade vessels. John Finnie will be fully aware that some vessels cannot fit into certain ports because of tidal restrictions. There is another conversation to be had about how we standardise some of that.

There are constraints, and it would be unhelpful to suggest that there are not. Extensive consultation is done. The vast majority of people whom we consulted were pleased with this summer’s timetable, but some were absolutely not, and they are probably well known to the committee. We continue to work with them to tweak what we can.

John Finnie is right that it does not take concerned citizens to explain the matter. CalMac has extensive discussion with community groups but, given all their ambitions and desires, we cannot always keep everybody happy because of capacity and vessel constraints.

10:00  

Richard Lyle has some questions on the reclassification of Network Rail.

What impact might the reclassification of Network Rail as a public body have on the availability of funds for future expansion and enhancement of the Scottish rail network?

The decision to reclassify Network Rail was taken—in September 2014, I think—by the UK Government, the Treasury and the Department for Transport. It is worth reiterating a couple of obvious points. Network Rail’s reclassification resulted in its financing and debt being transferred on to the public books, which means that it now has to seek lending from the Treasury rather than from the markets. A number of criteria have to be met now that its debt is on the public books.

I look to my officials to keep me right on the mechanics of the funding arrangements. Essentially, we receive 11.17 per cent of the debt financing. We are within that headroom for control period 5, but the general election means that we cannot have conversations with the Treasury and the DFT about their plans for the next control period. We will look for a fair and equitable settlement for Scotland, as we have done in the past, and we will continue to meet our statutory obligations to fund a high-performing railway. We will have further discussions with the Treasury.

I do not think that I am speaking out of turn when I say that I know from conversations that I have had with the DFT that it has frustrations with Network Rail because, despite its reclassification, a number of projects south of the border have been cancelled or deferred. The process is not just about reclassifying Network Rail as a public body under the DFT’s responsibility; it is also about improving Network Rail’s governance, transparency and accountability.

Scottish involvement in the management and funding of Network Rail operations is currently governed by a memorandum of understanding between the UK and Scottish Governments, and by ring-fenced borrowing arrangements that expire in 2019. How well has that worked in practice? What arrangements are being made for borrowing in the post-2019 period?

I will try not to repeat my previous answer, but I must say, in fairness to the Department for Transport, that its relationship with Transport Scotland is very good and works well. That does not mean that there are not tensions or difficulties but, in general, the relationship works pretty well. My relationship with my UK counterparts is also fairly positive and constructive. We do not always agree and we will always push further, while they will often push back. However, generally speaking, we have positive engagement on the Network Rail issue. The MOU arrangements work well.

I reiterate that, because a general election campaign is under way, no progress can be made on the statement of funds available. I hope that that will not impact on the publication of the HLOS, but it means that we do not know what the funding mechanism will be. I know that the DFT is exploring various options, including debt financing and grant aid. It will be for the DFT and, ultimately, the Treasury to make a decision on that. All that we ask for and will continue to ask for is a fair and equitable settlement for Scotland.

You have asked for full devolution of rail to Scotland. How might that work in practice? Would the UK’s Office of Rail and Road remain the economic and safety regulator? Would the Rail Accident Investigation Branch remain the body that would investigate accidents? Is that how you see things?

Even if we cannot get political consensus around the full devolution of Network Rail, I hope that members across the political spectrum will see that there is value in exploring whether the infrastructure projects element of Network Rail plus, probably, the timetable element should be fully devolved to Scotland.

That is not just our view. Members will be aware of the report from Reform Scotland that strongly backs Network Rail devolution. It was co-authored by Tom Harris, a former transport minister in the UK Government. There is a strong view in that report that, because Network Rail is funded by the Scottish taxpayer to develop and take forward projects on our Scottish railways, it should be accountable not just to the Scottish Government but to the Scottish Parliament. I do not know how many times, if at all, the head of Network Rail has appeared in front of this committee, but I suspect that it is probably not very many times, and I do not know how accountable Network Rail necessarily is as a body.

I believe that that devolution should happen. Even if members do not agree that it should be full devolution, I hope they will agree that there should be devolution at least of the infrastructure projects and preferably of the timetable elements, which are currently done in Milton Keynes.

On the wider question about the regulator, we have a very constructive relationship with the ORR. It has, as it often says, two main functions. One is safety regulation, which is the safety-critical role of the ORR. Taking a Great Britain-wide approach to that is not something that I am opposed to. We would see how far we would get in a conversation with the ORR about that. We have a number of cross-border routes, so it might well make more sense for the ORR to remain the GB-wide regulator with that safety-critical role.

On the economic side, economic regulation should enable an efficient, high-performing rail industry that is focused on the maximum benefits for passengers and freight users, so it might be sensible to evaluate whether the system of economic regulation is fit for purpose—I have already mentioned that there are some real issues around project delivery—or whether that should be devolved closer to Scotland.

On rail investigations, again, I would be open to having a conversation with the appropriate bodies about whether that function is best served UK-wide or devolved to Scotland. I am not politically sensitive about these issues. For me, it is about getting the maximum accountability and transparency for the Scottish taxpayer.

In the Northern Irish model, Belfast and Dublin have been able to co-operate effectively on redevelopment of the line between the two cities. Is that model worth looking at? All responsibility for the Northern Ireland network lies in Belfast.

Yes.

That was a commendably short answer. John Mason is next.

Minister, I would like to look in more detail at the pipeline approach, which you have mentioned a number of times. Will you explain how it is different from what we have had before? Can you give any practical examples of different decisions that might be made because we are using the pipeline approach rather than what has gone before?

In the current system, there is a prescriptive list of projects. We ask Network Rail to give us an early cost estimate of those, it does so and the projects are signed off. A few years later, lo and behold, Network Rail will come back, say that those projects have overrun and, because they were underpriced, ask for more money. That does not seem to me to be an efficient way of doing rail investment projects, and I think that there is a general consensus across the political spectrum that things could be done in a much better way.

That is not to excuse Network Rail. I am extremely disappointed about the overruns that have happened. I will not go back over well-rehearsed matters, but a lot of the issues, particularly around regulatory compliance, could have been foreseen.

That being said, a recent experience of project delivery and feedback to the consultation have showed a good level of support for the pipeline approach. It would give far greater certainty around costs and timescales, which would ultimately benefit not only passengers and freight users but, importantly, the taxpayer. It would also bring greater focus to the industry, with partners working together to examine all the options for improving capacity, such as exploiting timetables and rolling stock options.

On rail investments, a number of projects are currently in development, including new stations at Reston and East Linton. Improvements are being made to the line from Aberdeen to the central belt, in addition to the city deal money that has been provided. Work has been done on the far north line by the far north line review group.

We are saying that, if enhancement projects are proposed or a case is made to reopen a station, instead of closing them off at that stage based on what can and cannot be funded, we should work with the proposers to develop robust cost estimates and business cases. If the projects come back with a level of detail that gives us confidence, they should ultimately progress to being funded, if it is right for us to do that. No project should be disadvantaged by the planned changes—if anything, the changes might result in projects being agreed midway through a funding cycle or control period. There will be no requirement for a project to be in the HLOS or in X, Y or Z document for it to be funded. The approach is more flexible and open, and is very much based on the need for robust cost estimates.

There were problems with EGIP around price uncertainty. Under the pipeline scheme, would you delay the start of a project like that until there was greater certainty?

I do not like to make comparisons with projects that are already under way, although I understand why John Mason asked the question.

Essentially, if we had agreed to fund the projects that are currently taking place when more detailed work had been done on potential costs—particularly projects involving line electrification, such as EGIP, the Stirling-Dunblane-Alloa line and many others—we would have perhaps not been as surprised at some of the cost increases and delays.

That is not to excuse Network Rail at all. As I said, some of the elements that caused delays and cost overruns—such as the issues with the regulatory railway safety compliance approach that was used—could have been foreseen.

I am not suggesting that using the pipeline approach will mean that Network Rail will never delay another project. As I said, we need to have conversations with and ask questions of the DFT, as we continue to do with Network Rail, about their ability to develop railway projects and see them through to conclusion.

To be frank, I am still struggling. I accept that you do not want to revisit past projects but, on the other hand, unless we see examples that show how the pipeline approach will be different from what we have done in the past, I struggle to understand how decisions might be made differently.

To use another example, Borders rail has been very successful and I am very supportive of it. However, some people might feel that the project went ahead because local politicians and groups shouted very loudly rather than because it was the best project in Scotland at that time. Would the pipeline approach have made any difference? Would somewhere that was not shouting so loudly, such as Levenmouth, or Glasgow with the crossrail project, get a better chance under the new system than the old system?

You do a disservice to the campaigners at Levenmouth—they shout very loudly about their campaign, quite understandably and rightly. They have met me on a number of occasions, as have those members of the Scottish Parliament who represent their case.

On Levenmouth, conversations are continuing between Transport Scotland and the council. Again, our flexible pipeline approach can help to develop robust cost estimates and a robust business case for that type of project and enable it to progress to the next stage.

10:15  

There are specific examples of where we have delivered things slightly differently. The Winchburgh and Queen Street tunnel closures were two of the most significant planned disruptions since the current ScotRail alliance became operational. Both major works were delivered on time and on budget, and experience was gained from the closures. They show that a unified approach in the industry might be much better than the model that has been used in other projects. The Paisley canal line electrification project was delivered under the original ScotRail alliance, involving First, three years sooner than originally planned and at less than half the anticipated cost. We can learn from projects that have been delivered well.

The pipeline approach allows a controlled release of funds, and that is where we want to be. It is not about what projects shout loudest, as the member categorised it. It is about the robustness of a business case, which is about not pure economics and numbers but regeneration and the social impacts that a project can have. Business cases must be robust before we release funds.

We have not published the HLOS, and it is fair to say that we are still exploring internally how we do the pipeline approach. Once the HLOS is published it will have greater detail on that. The rail enhancement and capital investment document, which will be published at the end of the year, will give further detail on the approach.

Minister, you have been giving very full answers. I encourage you to be detailed but as brief as possible.

I put on record my thanks to the minister for facilitating a meeting that I had on Monday at Insch railway station with north east of Scotland transport partnership officials. Its purpose was to progress the issue of disabled access, which my question is about. I know that the minister is keen to ensure that accessible facilities are progressed, and I appreciate that.

My question concerns the proposal to merge several of the rail investment funds, such as the Scottish stations fund, into a general capital budget. Those funds were developed to address particular issues such as disabled access at stations. Can you assure us that if those separate funds are abolished, it will not lead to those issues being somehow lost or subsumed into the generality?

I feel that, as Mike Rumbles started by praising me, I should just retire and call it a day. I should end on a high.

It does not always have to be confrontational.

I will reciprocate by saying that I know that Mike Rumbles has long championed accessibility issues, particularly at Insch station, so I am pleased that yesterday’s meeting went well, and I hope that things come to a fruitful conclusion.

On the substance of his question, I am very aware of some nervousness around amalgamating the Scottish station fund, the accessibility fund, the freight fund and other funds into a general pot. I do not want to prejudge the HLOS before its publication but, because of those concerns, I am sympathetic to ring fencing because I can see the importance of the confidence and reassurance that it might give people. There are dangers with ring fencing, of course: it can be too rigid, so we need to see how we can increase the flexibility of some of the funds. I do not want to prejudge because we need to have the conversation that is going on internally but, on balance, I am somewhat minded towards ring fencing. I would be keen to hear members’ opinions on that because there are good arguments on both sides of the debate.

You have referred in a few of your responses to the need for a robust business case. Emissions from rail account for 1 per cent of all transport emissions. How will rail contribute to a reduction in greenhouse gas emissions over five years from 2019?

An important part of our HLOS document will be the specification of new emissions reduction targets, which will be linked to the Government’s climate change targets. There will be a requirement for a continuous and sustained reduction per train kilometre, which will be aligned with appropriate ScotRail franchise agreement targets.

As for how we will monitor those things, the shift in passengers from road to rail is important, but we are also putting a lot of work and investment into, and having a lot of conversations about, moving freight from road to rail. Some exciting projects are very close to materialising, and if we can pull them off, there will be almost a domino effect. We are looking at a variety of sectors with regard to freight, the two most exciting of which are whisky and timber. Those projects will, I hope, help us to reduce our carbon emissions. I cannot tell you what the new emissions targets in the HLOS will be, because we have not published the document yet, but they will be in it.

Railways should deliver a good passenger experience. As a passenger, I should have a seat, and the train should not only arrive on time but stop at the station that I want to get off at. The current consultation proposes the introduction of new ways of measuring rail performance that would replace or supplement the current public performance measure. What might those new measures be, and how will they be used to monitor rail performance and ensure that I have a good passenger experience?

That is a really good question. Passengers often say to me, “Your PPM stats might be very high, but what about the big frustration that is caused by skip-stopping?” I completely understand why people are frustrated by that. All credit goes to Phil Verster, the previous director of the ScotRail Alliance, who put a lot of effort into trying to reduce skip-stopping, especially at peak times. However, even if the incidence was reduced to 1 per cent of trains, people on that 1 per cent would understandably be miffed when it happens.

I will say a couple of things about that. First, I still think that PPM is the right overall industry measure; it is important to have those five minutes for arriving at a destination. Some people have suggested a move to on-time arrival, but that would have a serious impact on those who have mobility issues—there must be some flexibility in timing to ensure that those people can get on and off the train safely. Generally speaking, PPM is probably the right measure, but there is clearly a desire from the public for it to be supplemented or complemented. For example, we could have PPM not just at the end destination but, as Richard Lyle suggested, at intermediate stations. It is important that that performance is measured, too.

It is also important to improve journey times, because that could attract more people to rail and help us to make that modal shift. There are KPIs as part of the ScotRail franchise, but we are actively looking at other measures. Richard Lyle hit the nail on the head with his main point: improvement must be about the passenger experience rather than just numbers on a board.

Any time that I have travelled on the railway, I have enjoyed it. I hope to do so again over the summer.

The consultation indicates that the Scottish Government will review incentives for Network Rail to improve journey times, capacity and connectivity. What are the current incentives? Are they working? How might they be improved?

I will look to officials to keep me right here. It is the ORR’s role to determine the incentive framework for Network Rail as informed by the HLOS documents from the Scottish Government and the UK Government and by the ORR’s own extensive consultation process. There are a number of incentives, outputs and metrics for control period 5. In the next control period—in response to Richard Lyle’s question—we need to focus on journey time improvements, as I have mentioned, and especially on those that can be secured by Network Rail working with the industry through routine practices such as timetable development and network renewal.

I do not want to pre-empt the publication of the HLOS document, but it is likely that it will include a requirement for a regulatory journey time output. That is common sense: journey time improvements will attract more people to the railway.

Stewart Stevenson will ask the final question.

I have a few questions about the European rail traffic management system. It has been running for a few years on the Cambrian network, and I understand that it is going to GWR and London Crossrail, but it has yet to come to Scotland. It would bring benefits such as better capacity utilisation, and it might be appropriate to consider introducing it north of Inverness, given that there are signalling issues and—as with the Cambrian network—a relatively detached part of the network on which to pilot the system. We have one half of what we need for it: the global system for mobile communications railway—GSM-R—which is now more or less universal. Is it time that we started to introduce the ERTMS in Scotland?

I could hear my director of rail, who is sitting to my left, sighing heavily as you spoke, Mr Stevenson—not for any personal reasons, I am sure, but because he might have something to say on the issue. I will hand over to him in a moment.

The development and implementation of the ERTMS across the UK and Europe has generally been quite slow. As yet, we do not believe that there is necessarily a robust business case for it, given that it would be a significant investment, and we would therefore not recommend it for Scotland at this stage. However, we are working closely with Network Rail to develop an appropriate signalling strategy for control period 6. I will hand over to Bill Reeve, who might want to supplement that answer.

I do not have much to add. The European rail traffic management system is tantalising because it moves the control of trains away from drivers having to look at signals on the track and places the authority to proceed at speed in the cab, which is eminently sensible. However, its implementation track record has not been great to date. I have lost track of the number of project managers around Europe whom I have talked to who have been tearing their hair out and crying into their beer over how long and how much it has taken to implement the ERTMS.

We maintain a close interest in the system. However, it was originally designed for very high-speed lines, and a lot of the implementation problems have involved the adaptation of the technology for railways that are similar to those in Scotland. The Cambrian line, after a lot of cost and time, successfully introduced a signalling system that extended journey times and increased costs, but I am not sure that we want to rush into implementation just yet.

I understand that the UK expects to implement the ERTMS by 2044, so we are clearly not rushing into it for the Great Britain network.

That brings us to the end of our questions. Is there anything that we have missed, minister, that you would like to sum up quickly?

I am trying to think of anything that has not been covered, but I do not think that there is anything. Perhaps we did not go into the issue of freight as much as I would have liked.

When the HLOS is published, I will be happy to come back to the committee and have a conversation about it. I thank committee members for their questions and feedback. We are determined to publish the HLOS by the statutory deadline, but we hope to publish it before then if possible. If members wish to feed back any further comments, it would be helpful if they could do so as soon as possible.

Thank you, minister. I am sure that the public will take you up on your invitation to send letters about how arrangements between different types of transport could be better co-ordinated. I thank you for attending the meeting. I also thank Bill Reeve and John Provan, although unfortunately he did not get to say anything.

I suspend the meeting briefly for a changeover of witnesses.

10:29 Meeting suspended.  

10:32 On resuming—