Government announcements 29/4/14

[WatcherZero]

Two big announcements today.

Firstly the Access for All stations fund winners, £100m for disability access works up to 2019, 42 stations:

https://www.gov.uk/government/news/government-funding-to-make-stations-accessible-to-all

London and the South East

West Hampstead, Queen’s Park, Tottenham Hale, Peckham Rye, Seven Sisters, Chatham, Hither Green, Walton-on-Thames, Battersea Park, Streatham, Petts Wood, Blackhorse Road, St Mary Cray, Goldalming, Whitton, Virginia Water, Theale and Barnes.

East of England

Luton, Grays, Southend East and Manningtree.

Midlands

Lichfield Trent Valley, Market Harborough, Warwick, Alfreton and Kidsgrove.

North West

Liverpool Central, Penrith and Leyland.

Scotland

Hamilton Central, Blairhill and Elgin.

South West

Cheltenham Spa and Weston-Super-Mare.

Wales

Trefforest, Cathays, Barry Town and Llanelli.

Yorkshire and the Humber

Hebden Bridge, Garforth and Northallerton.

Secondly the Dft is asking for £550m from the Contingencies Fund for the financial year 2014/15 (i.e. breach of department budgets) because its decided to fund Network Rail borrowing directly rather than let Network Rail issue its own commercial bonds, which means £6.5bn of Dft rather than NR commercial borrowing during this financial year. It says it announced it on 23rd April but looking it seems this news was slipped out as a statistical foot note by the Debt Management Office rather than the Dft itself and only picked up on by Financial News media. Also should be pointed out that while the motive for this change is financial savings, NR currently enjoys a lower borrowing rate than Government debt on its bonds.

http://www.dmo.gov.uk/documentview.aspx?docName=/gilts/press/sa230414.pdf

https://www.gov.uk/government/speeches/contingencies-fund-advance

 

[LNW-GW Joint]

Is this just a means of DfT exerting more control over NR?
It hardly seems worth it if the rates are actually higher.
And "emergency funding" is not exactly an encouraging phrase.
What might be the reason? Franchises underperforming? Needing too many consultants? HS2 planning costs?

 

[LateThanNever]

Also should be pointed out that while the motive for this change is financial savings, NR currently enjoys a lower borrowing rate than Government debt on its bonds.

That is absolutely amazing as Network Rail doesn't make a profit in any real terms and relies on government backing... Clearly the government has missed a trick and far from taking over Network rail debt should finance its own debt by issuing Network rail bonds!

 

[WatcherZero]

I think it came about as the NR debt is underwritten by the Government its solid but because it wasnt issued directly by the Government it wasnt under the same market speculative pressure.

 

[thealexweb]

Given that Leyland is currently terrible for the physically impaired this is excellent news. Loads of steps and no lifts.

http://www.railbrit.co.uk/imageenlarge/imagecomplete.php?id=20918