Taxpayers 'ripped off' as rail spending soars

Rail passengers and taxpayers are being ripped off by a staggering explosion in costs and widespread incompetence, according to engineers, economists and consultants employed on the network.

In one case the state-backed Network Rail was charged £850,000 for a simple heating and ventilation system at a one-platform station that cost a total of £2.15m to build. In 1999 a similar station was built in its entirety for £850,000.

Simple components such as bolts are often sold to the industry by officially approved firms at three or four times the prices quoted by non-rail companies, the senior employees told the campaign group Transport 2000.

There is a huge variation from region to region in the price of replacing a single rail. This varied from £116 per metre on Great Western routes to £223 in East Anglia.

The Transport 2000 report, due to be published tomorrow, says the constant revision of regulation standards has led to projects being reworked repeatedly. In some cases, recently renewed track has been torn up to be upgraded.

The campaign group interviewed senior employees in confidence; virtually all of them called for radical change.

Chains of command on the network were too long and contracts with companies were "flabby and unclear'', respondents told Mick Duncan, the author of the report. Mr Duncan pointed out that the cost of providing the railways had trebled since 1997, saying: "It appears much of this money has been wasted on inefficiencies and incompetence at every turn.''

He said Network Rail had made good progress in taking maintenance back in-house, but there was "still a very long way to go''. The amount of money pouring into the railways should provide the basis for a "world-class'' network.

The report found that the approach to safety had become "inflexible'' so that expensive footbridges are being built over lightly used branch lines. Routes are sometimes closed to allow work to take place when there is no need on safety grounds to do so.

The analysis comes at a time when the Government has ordered a review of the management of the industry in a desperate attempt to place it in good order before a likely general election next spring.

The Treasury has expressed concern that, despite the billions of pounds spent, the reliability of train services shows little sign of improving.