Office of
Rail Regulation

Nichols has acted as a trusted Independent Reporter for the Office of Rail Regulation since 2009. Our reviews have enabled Network Rail to deliver its projects and programmes more effectively and efficiently and allowed the ORR to assure Network Rail’s performance.

Challenge
The Office of Rail Regulation (ORR) is the economic and safety regulator for the UK rail network. As the economic regulator, the ORR sets output targets and determines the funding that Network Rail receives. It ensures that Network Rail performs as a reasonable and efficient operator in line with its Network License.

As Independent Reporter, Nichols provides the ORR with assurance of Network Rail’s operational and project delivery performance. Between 2009 and 2016 we have conducted over 30 separate reviews covering operational performance, infrastructure projects, asset management and capability improvement programmes.

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Experience
In November 2015, Sir Peter Hendy, Network Rail Chairman, published his report on the re-planning of Control Period 5 (up to 2019) Enhancement Projects. The purpose of the Sir Peter Hendy review was to develop a more robust plan for the remainder of Control Period 5, and required a thorough review by Network Rail of all its current programmes and projects between July and November 2015. As a trusted advisor with unique experience gained over the past seven years in our role as Independent Reporter for Enhancement Projects, Nichols were jointly commissioned by the ORR and Network Rail to provide an independent assurance report on the Sir Peter Hendy review.

We bring a unique combination of broad industry knowledge and change management experience to our reviews, identifying specific opportunities to improve delivery. For example, the significant improvements in planning and efficiency that resulted from our review of the £900m Reading Re-modelling project and our review of major upgrades leading to complex timetable changes.

Additionally, we have identified wider lessons that are transferable to other programmes. For example, when examining Network Rail’s operational performance we identified systemic delivery issues and risks, which resulted in regulatory enforcement action. This helped to drive vast improvements in the management systems adopted by Network Rail, which have now become established good practice.

Assuring performance for UK rail

For planning purposes, Network Rail works within 5 year Control Periods. The Secretary of State for Transport indicates what work should be completed during a given Control Period. For each Control Period, the ORR undertake Period Reviews to determine what Network Rail must achieve, the money it requires to do this, and the incentives needed to encourage delivery and outperformance. The ORR then publishes a Determination to Network Rail which sets out all the decisions from the Period Review.

Our reviews of Network Rail’s capabilities in Project and Programme Management helped to guide the setting of regulatory targets for Control Period 4 (2009-2014). In 2013, we reviewed Network Rail’s progress and ongoing improvement plans for Control Period 4, providing a provisional efficiency assessment of Network Rail’s submission to the ORR covering the £7.2bn cost of their enhancement programmes.

Benefits
Through the application of the efficiency framework, we have ensured that value for money continues to be obtained. In the Control Period 5 review, we identified £600m of cost savings, these were included in the draft Determination provided by the ORR to Network Rail in 2013.

The Nichols independent assurance report on the Sir Peter Hendy review provides the third line of assurance in Network Rail’s ‘three lines of defence’ assurance strategy. This external assurance enables them to meet the requirements in the Secretary of State’s Terms of Reference, and strengthens the rail industry’s ability to successfully deliver major projects in the future.

Our reviews have been delivered under the principle of a joint duty of care to both the ORR and Network Rail. We pride ourselves on being an independent guiding mind, recognising and promoting good performance, innovation and learning in our reviews. Our careful investigation and high quality of communication has ensured that our reviews have been clear, and well received by the ORR, Network Rail and the wider industry.

Stories

London 2012 Olympic
and Paralympic Games
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Transport for London Nichols-TFL Crossrail Nichols_Group_Crossrail_Thumbnail Nuclear Decommissioning Authority Nichols_Group_Nuclear_Decommissioning_Authority_Thumbnail Thales Nichols-Thales-Thumbnail Anglo American Nichols-Anglo-American Department for Transport Nichols_Group_Department_For_Transport_Thumbnail Sellafield Nichols_Group_Sellafield_Thumbnail Office of Rail Regulation Nichols_Group_Office_For_Rail_Regulation_Thumbnail

Iconic Stories

Jubilee Line Extension Nichols-Jubilee-Line Highways Agency Nichols-Highways-Agency Docklands Light Railway Nichols-DLR Hong Kong West
Kowloon Expressway
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AVIVA Nichols-AVIVA Crossrail Early Years Nichols_Group_Crossrail_Early_Years_Thumbnail Department for Transport Intercity Express Programme Nichols_Group_Department_for_Transport_Intercity_Express_Programme_Thumbnail Transport for London
Capital Programmes
Delivery Capability
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Hong Kong
Highways Department
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Improving Delivery
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