The Government has confirmed today it will award Nexus around £580 million to modernise and operate the Tyne and Wear Metro.
Most of the money, up to £350 million pounds, will be spent on the Metro: all change modernisation programme over the next 11 years.
A further £230 million will support Metro’s running and maintenance costs over the next nine years.
The funding package is by far the biggest in Metro’s 30-year history and secures the future of the light rail system, used by more than 40 million passengers every year.
Cllr David Wood, Chairman of the Tyne and Wear Integrated Transport Authority, said: “This is an unprecedented funding boost for Metro secured at a time when public spending in general is under real pressure.
“Metro is vital to the economy and social life of North East England and has a crucial role to play as our region emerges from recession.
“This announcement is worth something like £2.5 billion to the economy through the impact Metro has supporting jobs and opportunity, as well as creating scores more in the engineering and construction sectors.”
“The Government has been bold in showing the value it places on sustainable transport, and recognised the ITA’s vision to modernise Metro as the core of the wider networks of the future.”
Rt Hon Nick Brown MP, Minister for the North East and Member of Parliament for Newcastle East and Wallsend, added: “Today’s announcement safeguards the future of the Tyne and Wear Metro for a generation. The Metro is the envy of other cities and the Government’s commitment reflects the importance of the Metro to our region.
The Government’s package of over £300m of capital investment will be focussed on what passengers want, transforming the Metro and renewing its world class status resulting in a better service, securing hundreds of jobs and delivering value for money to the tax payer.”
The capital grant from Government combined with local expenditure means Nexus, which owns and manages Metro, can invest almost £400 million modernising it over the next 11 years.
In the early years the money will allow Nexus to modernise 12 stations, including Central, install new escalators at Monument, new lifts at key interchanges, renew more than 11km of track and 34 bridges, lay 60,000 metres of new cabling and oversee the refurbishment of all 90 Metrocars.
This is in addition to existing programmes to modernise Sunderland and Haymarket stations, to be completed this year, and the installation of new ticket machines at every station capable of selling ‘smart’ tickets backed by online purchase,
Bernard Garner, Director General of Nexus, said: “We have satisfied challenging Government conditions in order to secure this funding and with it the future of Metro.
“Our ambitious modernisation plans, combined with a concession secured with a new operator to run trains and stations on our behalf, will deliver real improvements passengers will notice on their day-to-day journeys.
“This has been a long process at a difficult time but we have won significant improvements in passenger service and excellent value for money.”
As part of the funding settlement a new contractor, DB Regio Tyne and Wear Limited, last night signed a contract to operate stations and trains on behalf of Nexus from 1 April 2010. It has committed to:
- Increasing the number of trains at peak times from December 2010;
- Improving even further Metro’s already high standards of punctuality and reliability.
- Offering a new customer refund mechanism if trains are delayed more than 15 minutes – whatever the cause;
- Investing in major improvements to the Gosforth train depot, supporting better train performance.
- Guaranteeing a minimum 18 security staff on duty every evening, as part of an investment programme to make stations feel safer;
- Raising targets for waste recycling, including segregated bins at every station;
- Setting new standards in the cleanliness of stations and trains;
- Improving links with local communities round stations with new ‘station managers’, community notice boards and community meetings.
It will also completely refurbish all Metrocars as part of the Nexus-funded modernisation progamme.
Adrian Shooter, Chairman of DB Regio Tyne and Wear Limited, said: “Metro is already a very good railway system, and we are very excited by the opportunity to raise performance and customer service even higher.
“Together with our new MD of DB Regio Tyne and Wear Ltd, Richard McClean, I am looking forward to working very closely with Nexus and our new colleagues on the Metro team to deliver our joint objectives.
“DB will be able to use our experience on London Overground and Chiltern Railways in fine-tuning Metro operations to achieve standards set when it first opened in 1980, when it was rightly considered among the best in the world.”
Nexus will continue to own Metro, will set fares – which have been frozen for 2010 - and service specifications directly. It will pay DB Regio Tyne and Wear Limited agreed payments over the length of the contract, included in which is a bonus and penalty element based on its performance, particularly in relation to train operations, service quality and revenue protection.
Around 400 people who now work for Nexus on Metro duties including train driving and control, train maintenance and station operation will transfer to the employment of DB Regio Tyne and Wear Limited. The firm has also committed to make no compulsory redundancies for the life of its contract with Nexus.
A further 270 people who also currently work on Metro will remain with Nexus, in roles involved with managing the whole system including the operating concession, taking forward the modernisation programme and maintaining infrastructure including tracks, communications, power supply, station buildings and equipment.