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Archive
2013-12-17 NET-001
Network Rail
Network Rail responds to ONS reclassification announcement
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Press release
Network Rail
Network Rail responds to ONS reclassification announcement
date 17 December 2013
source Network Rail
type Press release
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The Office for National Statistics (ONS) has today announced a statistical change to its classification of Network Rail as a result of changes in European accounting guidelines.
As a result, Network Rail's debt, around £30bn, is to be reclassified as public sector debt for the purpose of government statistics. These new guidelines and the resulting reclassification come into effect on 1st September 2014.
This reclassification of Network Rail as a central government body is a statistical decision that does not alter the company's structure as a not-for-dividend company, limited by guarantee, with Members rather than shareholders. The business acts and operates today as it did yesterday, and its job of delivering a safe, reliable and improving railway for four million daily users continues.
Network Rail and the DfT have also published today a Memorandum of Understanding (MoU) that gives some more detail of how they will work together to ensure that the company's business continues as usual. The MoU also acknowledges that some small changes will be necessary as the company becomes accountable to parliament for its finances. At least initially, the company will continue to raise debt to fund its ongoing investment programme whilst the longer term funding options are considered.
Critically, for example, the company will retain the commercial freedom to work collaboratively with train operators and suppliers in delivering sustainable improvements in the railway under the well established regulatory framework that provides stability of funding through the five year regulatory review process.
Railnews Archive ::: 2013-12-17 NET-001
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