Committee publication · Report · 10 February 2026 · HC 575
7th Report - Rail investment pipelines: ending boom and bust
From: Transport Committee
Inquiry: Rail investment pipelines: ending boom and bust
Government response deadline: 10 April 2026
Summary
The Transport Committee finds that UK rail investment is plagued by 'boom and bust' cycles that damage the supply chain, inflate costs, and delay improvements. The report recommends restructuring investment pipelines—through a revamped Rail Network Enhancements Pipeline, a Long Term Rail Strategy, and a rolling stock strategy—to provide steady, predictable funding. Great British Railways offers an opportunity to break this pattern if decision-makers exercise restraint and resist micromanagement.
Key findings
- Rail investment cycles of 'boom and bust' increase costs by up to 7.25% per project and threaten viability of suppliers, particularly SMEs. A 2025 survey found 64% of rail businesses expect industry contraction and 85% expect work stoppages.
- Electrification exemplifies the consequences: past cancellations made it 'politically toxic'; Germany's steady approach achieves 61% network coverage at lower unit rates; Scotland's rolling programme delivers internationally competitive costs.
- Current mechanisms—Control Periods, Rail Network Enhancements Pipeline (RNEP), ad hoc announcements—are fragmented and irregularly updated, failing to provide the transparency and sequencing needed by suppliers and investors.
- Skills shortages require 3+ years to address but supply chain confidence lasts 11–18 months; a stable pipeline would enable apprenticeships, workforce planning, and R&D investment currently deterred by uncertainty.
- Devolved authorities and private investors express strong appetite to fund rail assets but lack long-term strategic clarity on what projects are committed and how risk will be allocated.
Recommendations
- Review Control Period settlements to smooth within-period cash flows and eliminate peaks and troughs in supplier spending.
- Revamp the Rail Network Enhancements Pipeline (RNEP) with annual updates, five-year funding certainty, clear identification of committed vs. unfunded projects, and flagging of opportunities for private and devolved authority investment.
- Develop a Long Term Rail Strategy (30-year minimum) setting firm policy objectives on electrification, rolling stock, accessibility, capacity, and major programmes; align it to growth priorities and protect it from radical changes of direction.
- Publish a rolling stock strategy coordinated with infrastructure projects to avoid peaks and troughs in procurement; draw it up collaboratively with industry.
- Ensure Great British Railways is protected from micromanagement and the Government makes clear its expected level of autonomy in enhancements planning.
- Enhance devolved authority funding settlements and clarify 'right to request' provisions in the Railways Bill to enable local rail investment aligned to strategic objectives.
- Provide strategic clarity on Government's appetite for private investment in railway infrastructure and identify specific projects where private and public finance models will apply.
Tone
CriticalTopics
Key actors
Ruth Cadbury (Transport Committee Chair), Lord Hendy of Richmond Hill (Rail Minister), Sir Andrew Haines (Network Rail Chief Executive), Noel Travers (Railway Industry Association Chair), Elaine Clark (Rail Forum Chief Executive), Heidi Alexander (Secretary of State for Transport), Fiona Hyslop (Scotland's Cabinet Secretary for Transport)
Notable line
“… what we are experiencing at the moment is way beyond anything I have experienced in my career.”
Key Quotes
“… what we are experiencing at the moment is way beyond anything I have experienced in my career.”
“… if you drop a stone in a pond, the big Tier 1s near the centre can often weather the storm because they are big enough and perhaps diverse enough to cope, but as you get further out towards the edge of the pond the SMEs are the ones that will get capsized by the ripples.”
“That is almost incontrovertible. If you have a steady pipeline that allows you to optimise the workforce, build in technology and minimise disruption, all three are significant factors that would result in a lower overall cost.”
“The expectation, and the prediction that the companies involved made, was that that would roll on and there might be some minor dips, but broadly that workload would continue. It has not.”
“… what we had was almost a generation of no electrification. As a result, we did not have a skills base in the country that had optimised it.”
“There is strong appetite for investment in railway infrastructure, but confidence has been affected when previous attempts to unlock investment have failed to deliver the expected investment opportunities.”
Source · parliament.uk record ↗