How record investment in the UK's rail network will benefit Scotland and help UK firms compete for opportunities across the Commonwealth.
Good afternoon everyone.
I’d like to start by thanking Jeremy for those kind words of introduction and I’d also like to thank the Rail Industry Association and UK Trade and Investment for your help organising today’s (25 July 2014) event.
Some of you may know that I was first appointed as a minister in the Department for Transport in 1989. That year, Britain’s railways carried around 800 million passenger journeys and England had a reasonably successful football team.
Ladies and gentlemen, I am very pleased to be able to report progress. By last year, the number of passengers on Britain’s railways had doubled but perhaps the less said about the football the better!
When I think about what has been the biggest development since my first stint in the department it’s the way transport has moved right up the political agenda.
And when I travel overseas transport ministers all say the same thing. Countries are prioritising investment in their transport infrastructure.
Because the future is a world where our success will be determined by who can collaborate, innovate, and co-operate best. So they want more, better, quicker connections between their great cities.
And I’d like to talk about some of our plans for investment in the UK this afternoon. But I know you have a number of great speakers lined up so I will keep my remarks brief.
Long term economic plan
After a few tough years following the financial crisis Britain’s economy is back on track including here in Scotland.
The UK’s economy is the fastest growing of any of the G7. We are on course to halve the record deficit we inherited and private sector employment is up by 2 million since 2010. As the economy returns to growth the demand on our railways is going to continue growing for the foreseeable future.
But the truth is too many commuter services are already overcrowded and some routes cannot accommodate any more trains. That’s because when the coalition came to power we didn’t just inherit a fiscal deficit we inherited an infrastructure deficit too.
According to the OECD, the UK has consistently invested less in our infrastructure than our major competitors. That’s why over the next 5 years as part of our long term economic plan we will be making a record investment in Britain’s railway.
That includes the Northern Hub, which will mean better links between Manchester and Glasgow, and running bigger, more reliable trains on the East coast mainline.
In the past 12 months alone, the Scottish government has invested almost £600 million in rail infrastructure, including new stations at Haymarket and Dalmarnock, and the electrification of the Glasgow to Cumbernauld line.
And just 3 years from now, we will also be building High Speed 2. The first new north-south railway for a generation.
By cutting the journey times from Edinburgh and Glasgow to cities in England HS2 will boost the Scottish economy by around £3 billion.
But the benefits of high speed rail will keep growing. Our objective is a national network that will bring the constituent parts of the UK closer together. So I welcome the support and enthusiasm for high speed rail in Scotland.
Taken together, that’s the biggest investment in our railway for decades. It’s an opportunity to bring the great cities of the UK closer together, to continue to be better together, and it is a huge opportunity for Britain’s railway industry.
As well as investing in infrastructure, to grow our economy over the long term, we need to make more and export more. So we want to help you win business overseas.
When it comes to reaching new markets, we probably don’t talk about the Commonwealth as much as we should. India, Malaysia, Bangladesh, Sri Lanka, Kenya and Ghana are among the fastest growing countries in the world.
The scale of change is huge. For example, by 2050 there will be almost as many people in Nigeria as in the United States and Malaysia’s economy will be larger than Italy’s today.
But in most of those countries, traffic congestion is already a serious problem.
That’s why many Commonwealth members are making big investments in rail. Because it is the best solution to their transport needs. It’s fast and reliable, it’s safe and clean, and it provides the high capacity links needed by growing economies.
High value opportunities
Take just the 3 examples Andrew will set out later.
Singapore has plans to expand their Mass Rapid Transport system by a further 182 kilometres and to build a new high speed rail line to Kuala Lumpur.
Malaysia will be spending over £4 billion a year between now and 2020 expanding their Mass Rapid Transport system.
And the Canadians have big plans for high speed rail, including a link between Toronto and London just to be clear that’s London Canada. That’s just one part of a $29 billion transportation infrastructure plan.
I know Andrew will provide more details shortly and what help UKTI is able to provide.
Innovation and skills
To win opportunities like these, the UK rail industry must be ahead of the game. Offering the technologies that will appeal to tomorrow’s market.
The Rail Technical Strategy which was produced by the industry last year is an impressive statement of intent. It shows how new technology could deliver a railway that’s safer and more reliable.
We want to help that happen. That’s why my department is investing £500,000 in the FutureRailway team to promote innovation across the industry.
But to compete for business, you don’t just need the latest technology, you need the best people.
The National Skills Academy for Railway Engineering is already raising the quality of training and skills development and the Crossrail Tunnelling and Underground Construction Academy is teaching the next generation of tunnelling engineers.
From 2017, it will teach some of the brightest engineering and construction students in Britain, providing them with the specialised training and qualifications that’s needed to build HS2 and to be in the race to build and maintain the 51,000 kilometres of high speed rail that are planned to be in operation around the world by 2025.
Rail Supply Group
I’m determined that we do all we can to help the UK rail industry grow. That’s why last year Vince Cable and I announced the formation of the Rail Supply Group.
It brings together government and industry to raise skills to promote innovation and to increase exports. I’m confident that the group which is co-chaired by Terence Watson, the UK President of Alstom will help British firms win more work here and abroad.
And you’ll be hearing a lot more about the group’s work in the coming weeks and months.
So to sum up, over 80,000 people work in the UK rail supply chain. It’s a sector that is growing and already attracting international investment.
Hitachi is moving the headquarters of its global rail business to the UK. I think that’s a huge vote of confidence in Britain and the British workforce. And I’m sure Andy will say a bit more about their plans later.
As a result of winning the Crossrail contract, Bombardier are creating up to 340 new jobs including 80 new apprenticeships. And I’m very pleased to see Noel here today. I’m sure he’ll tell you a bit more about the opportunities they will be creating.
And I’m also pleased that Siemens are working with my department and the Department for Business, Innovation and Skills to build a new rolling stock training academy in Northampton.
Over the coming years we will be making a record investment in expanding and improving Britain’s railway.
And as well as winning contracts here, we want to help you compete overseas, grow your business and create jobs. I’m confident we’ve got world class firms in Britain who have what it takes to do so.
I think this is a fantastic opportunity for the UK’s rail industry. Together, we have an opportunity to build something better a railway we can all be proud of.
Thank you for listening. I look forward to our discussion.