As it plans its £23b investment in rail infrastructure projects Network Rail has announced plans to shake up the way it works with its supply chain. This should be good news for contractors and consultants prepared to focus on investing in people, skills and committed to working in long term relationships based on trust and openness.

What’s more, with £4.7b worth of contract awards and frameworks allocated for Wales and the West of England the move by Network Rail has huge potential for contractors and sub-contractors in Wales who are prepared to embrace the values of collaborative working and committed to local communities and economic and environmental sustainability. 

Simon Kirby, Network Rail’s Infrastructure Project Director has emphasised that driving out a low cost culture is key to the shake up.

“They can’t buy the jobs based on low cost. We want to get into long-term relationships where suppliers invest in skills. You don’t get that by tendering every contract. Longer term commitment means firms can employ their own people.” 

Network Rail’s management aim to provide a clear, visible pipeline of work allowing the supply chain to plan now and target where they can win work. What’s more the opportunities are structured to allow time for contractors to adapt their business models to work as tier one, tier two or lower. Each of the parcels of work is being let regionally with a subtly different framework composition with different contractors likely to be appointed. 

Simon Kirby stressed: “Repeat business is what they (contractors) want. If they don’t perform on safety and quality they won’t win much work.”

The first awards of civils renewals contracts in Wales and the West are worth around £491m. The breakdown of this is yet to be determined, but bigger schemes such as electrification are likely to go to a tier one contractor. Kirby said: “There is plenty of work there – there is no need to be loser in this.”

In the new year CEW will be engaging with Network Rail to better understand their approach, share it with the industry in Wales and help Welsh businesses to align themselves with this collaborative approach to delivery.

Watch this space for more information in the new year.