The Department for Transport has done well so far to contain the infrastructure costs for the Thameslink Programme within the original budget, according to an examination of the progress being made to increase passenger capacity on the rail route through central London. Phase one of the Programme cost £1.704 billion, was completed on time and was £143 million under budget.
However, delays of more than three years in agreeing the contract to buy new trains mean that delivering value for money from the Programme as a whole is at greater risk than the National Audit Office would have expected at this stage.
According to today’s report, there continues to be a robust transport case for the £3.552 billion (at 2006 prices) Programme. Thameslink services have consistently been among the most crowded London routes with passengers amongst the least satisfied with space on trains; and demand is forecast to increase. The Department estimates that the Programme will make net present benefits of £2.9 billion through reduced journey times, reduced overcrowding on trains and quicker interchanges between services.
The Department needs to manage a complex interaction between completing the infrastructure project; buying new trains; and letting a new franchise. Delays to any of these projects can delay significantly or complicate delivery of other parts of the Programme. The award of the estimated £1.6 billion contract to buy new trains is currently delayed by over three years and this has implications for the rest of the programme and also plans for electrification of other parts of the rail network.
The delay raises questions about whether the Department underestimated the scale of the work, time and skills and resources it needed to negotiate a PFI deal of this complexity. And until the contract is let it will not be clear whether delivery of the whole Programme by 2018 is still feasible.
As work begins on phase two of the Programme, the Department needs to ensure it has the necessary capacity and skills to keep it on course alongside other rail projects it manages, such as Crossrail and High Speed 2.
"It’s too early in the Thameslink programme to conclude on whether or not it will achieve value for money. That will have to wait until the new service is running. However, there has been good progress in delivering the first stage of the infrastructure part of the programme on time and under budget, which the Department now needs to build on.
Our principal concern is around the delay in agreeing the contract to build new trains which raises questions about the feasibility of delivering the whole Programme by 2018.”
Amyas Morse, head of the National Audit Office
Notes for Editors
Thameslink programme's budget for infrastructure works, 2006 prices
Additional carriages expected to be provided to increase passenger capacity
1.4 to 1
Most recent benefit–cost ratio for the Programme.
Estimated outturn cost of trains and depots funded through PFI
Cost of the first phase of the infrastructure works, which was £143 million under budget, 2006 prices
Budget for the second phase of the infrastructure works, 2006 prices
Original duration of the programme from approval in 2007 to completion by 2015
Revised duration of the programme with completion in 2018
Notes for Editors
1. Press notices and reports are available from the date of publication on the NAO website, which is at www.nao.org.uk. Hard copies can be obtained from The Stationery Office on 0845 702 3474.
2. The National Audit Office scrutinises public spending for Parliament and is independent of government. The Comptroller and Auditor General (C&AG), Amyas Morse, is an Officer of the House of Commons and leads the NAO, which employs some 867 staff. The C&AG certifies the accounts of all government departments and many other public sector bodies. He has statutory authority to examine and report to Parliament on whether departments and the bodies they fund have used their resources efficiently, effectively, and with economy. Our studies evaluate the value for money of public spending, nationally and locally. Our recommendations and reports on good practice help government improve public services, and our work led to audited savings of almost £1.2 billion in 2012.