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There has never been a more exciting time to be a supplier in the UK rail industry. Investment has been much needed for some time, but now the scale of it is unprecedented. Across infrastructure, signalling, rolling stock and stations, the enthusiasm in the sector is tangible. We are embracing the opportunities that are being created.
Beyond the UK’s classic rail network, HS2 steams ahead as well. Full Parliamentary approval for building the line is almost upon us. And HS2, more than any other project, will be truly transformational for our industry.
Finally, as a sector, we know that there is a significant pipeline of investment for which we can plan. This critical long-term certainty will enable us to plan and organise better. We can improve what we offer the rail network, and on top of that how our businesses will benefit the country through the investments we make to deliver it.
But all this needs to work both ways. Beyond being shown long-term plans, it is also vital that suppliers get more involved in the planning themselves. That will allow capability and capacity to be factored in properly.
We need each other. The UK rail supply sector has spent too long behaving tactically, leaping from one opportunity to the next without developing a long-term strategy. We need to change that to become sustainable and to grow.
With the publication of the Rail Supply Group (RSG) strategy, everything changes. If it is successful (and I believe that it will be), the industry can take advantage of the investment in our domestic market and exploit it to compete effectively in the vibrant global rail market.
We are not starting from scratch. The Rail Delivery Group’s Rolling Stock Strategy, first published in 2013, started us on this path - giving suppliers greater understanding of the orders coming in the medium term. The Government’s National Infrastructure Plan has also been important, and starts to explain a wider view of Government investment. These long-term projections are already helping British manufacturers to plan for the future of their businesses. Now the RSG strategy completes this jigsaw.
Let me be clear - we have never been here before. The RSG rail sector strategy is the first clear statement of the aims of the industry, as we seek to build sustainable growth and develop our export strength. It is simultaneously full of new ideas while being grounded in years of experience in this country and internationally. And having been developed by the entire industry for all rail manufacturers and suppliers, it will have a unique part to play.
Rail may be a relatively late addition to the Government’s industrial strategy programme, but with this new strategy nobody could argue that the UK rail supply sector has failed to deliver a comprehensive plan. We are confident that it will provide the framework to transform the rail supply chain over the next ten to 15 years and beyond.
The RSG Council represents a diverse range of stakeholders including international companies, small and medium-sized enterprises (SMEs) and clients, working in partnership with Government.
Just as the RSG strategy is designed to fit with the wider landscape of long-term planning, so the RSG contributes to the group of rail leadership bodies that will drive the modernisation of the railway. The RSG works closely with the Rail Delivery Group, the Association of Train Operating Companies, Network Rail and the Rail Freight Group to establish a shared vision for the future UK railway. And all of these groups have contributed to the development of the strategy.
The RSG strategy aims to make the most of the record rail investment. The Government has committed £38 billion for the delivery of Network Rail’s infrastructure investment programme in Control Period 5. The full level of investment in rail infrastructure across all of the RSG’s areas of activity (including London Underground and Light Rail systems across the UK) is nearly £87bn, according to the Government’s national infrastructure plan. Add to this the value of rolling stock contracts across the UK, and it is clear that we are in an unprecedented period of investment in the UK railway.
This reflects the new confidence in the potential of rail to deliver key benefits for the UK economy. And RSG considers it the role of the rail supply chain to structure itself so that it is best placed to capitalise on this investment.
This is about more than securing effective delivery of the exciting projects in the infrastructure pipeline to deliver growth, jobs and increased productivity for the UK economy. It is also about positioning the UK rail supply chain to use these opportunities to develop its capabilities to export and grow - whether by exporting new capabilities to develop and manufacture high-speed rail, by enhancing the capacity of our rail sub-systems, or by growing the capacity of our SMEs so that they are able to make an impact on the global market. The potential prize is huge for the UK… a much greater share of the £128bn international market.
We are well placed to take advantage of these opportunities. We directly employ over 124,000 people, with an estimated turnover of £7bn and generating £3.8bn of value to the UK economy. This is a significant contribution, and we should make far more of our role and status in this wider context. The range of businesses in the supply chain, from SMEs to established trans-national companies, gives us huge potential for collaboration and growth.
