Rising costs 'threaten rail plans'

Extra capacity must be delivered at an affordable price

Simon Montague BBC Transport Correspondent

Government rail chiefs are warning that passengers could see plans to modernise Britain's railways delayed or scuppered by rising costs.

Richard Bowker, chairman of the Strategic Rail Authority, says rail companies must ''get a grip'' on the price of major rail projects.

Alarm bells are ringing after a four-fold increase in the cost of upgrading the West Coast main line between London and Glasgow to almost £10 billion.

There is a real worry that if costs rise in a way which becomes uncontrolled, then projects will become unaffordable

Richard Bowker, chairman of the Strategic Rail Authority

That has raised fears that future modernisations of the East Coast line between London and Edinburgh, and the Great Western route between London, South Wales and south-west England may have to be scaled back or postponed.

The government has ordered the authority to take charge of developing major rail schemes following the final removal of Railtrack this month.

Ministers have told Network Rail, the new company which has taken over the running of track and signals, to focus purely on operating and maintaining the existing system.

Value for money

In an interview with BBC News Online, Mr Bowker says: "There is a real worry that if costs rise in a way which becomes uncontrolled, then projects will become unaffordable. We're not at that point yet, but we could get to that point if we don't get a really tight grip on it."

The West Coast line has proven a bleeding artery

Mr Bowker has told rail contractors that they must tackle sliding standards, bad planning and poorly managed track possessions.

The government has promised that £60 billion will be invested in rail over the next 10 years to meet forecasts of a 50% growth in passengers.

But investment is likely to dry up unless the taxpayer gets good value for money.

Mr Bowker suggests time is short, but adds: ''That's a cause for action, not a cause for panic at the moment."

He knows his credibility with his ministerial bosses is on the line if he does not deliver.

Mood of optimism

Transport Secretary Alistair Darling says: "Cost control is critical. The numbers have got to make sense. We can only justify the investment if the public can see its value and there are tangible results.''

Bowker: Railways must compete with road and air

There is a new mood of optimism in the rail industry, following the removal of Railtrack, creation of Network Rail and arrival of new leadership at the Strategic Rail Authority.

Passenger groups and train operators are beginning to believe once again that the industry has a bright future, and the government is willing to make long-term investment.

But that optimism is still fragile: if rail companies and contractors do not deliver punctual services and extra capacity at affordable prices, then Mr Bowker warns that rail will not be able to compete with cars, buses and planes.

If that happens, he says, the government support that is critical to the future of the railways will be lost.