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Business Case

Will the EWR Compete with Road?

Whether enough people will use the EWR to justify the business case depends crucially on how it competes with road. In my last post I presented some empirical data on the Bedford to Cambridge journey pair. This post is a copy of a recent letter to the Department for Transport which considers more journey pairs between Cambridge and Oxford.

The Rail Minister has held meetings with various local MPs recently and tells them that a review of the business case for the railway is currently in progress with a view to publishing a decision about whether to proceed in June. So I thought was a good time to share this analysis of the recent Network Rail Report with the DfT’s EWR Team.

The analysis brings together some issues we have been raising with EWR Co. for a long time now – in particular the lack of integration with local plans and local transport schemes. These were issues we presented to the previous Rail Minister Chris Heaton Harris in Feb 2021. They are fundamental to the business case – or should be.

Here is the letter.

To: The East West Rail Team at the Department for Transport.

11/5/2022

Dear EWR Team,

I understand from my MP’s office (Anthony Browne, South Cambridgeshire) that you are currently working on a recommendation to the rail minister and others about whether the central section of the EWR should go ahead. In the spirit of helping you reach the right answer and having spent the last couple of years off and on looking at this issue from a local perspective, I want to share some of the challenges that I see any case for the railway needs to address. Apologies if some of this material is already familiar to you.

  1. On average, railways in the UK are loss making[i]. The EWR does not have any major cities along its route and the transport gravity model[ii] therefore predicts that traffic demand will be much lower than say between Cambridge and London. Can you really show that the EWR will not require a subsidy? Economists tell us subsidies destroy jobs by reducing market efficiency.
  2. The generalised journey time for origin/destination pairs along the line have recently been published by Network Rail[iii]. They conclude that journeys beyond Oxford and Cambridge are not competitive with road due the interchange times at Oxford and Cambridge. For journey pairs between Oxford and Cambridge the table below shows the network rail data in minutes. I have repeated the data allowing for the peak 10-minute improvement expected from the Black Cat to Caxton Gibbet A428 work[iv] and repeated them again for illustration assuming a 30-minute allowance for first and last mile on the EWR time.
Network RailEWR GJTRoad (Peak)EWR Benefit
Ox-MK618019
Ox-Bed7711033
Ox-Cam1251283
MK-Bed5535-20
MK-Cam9885-13
Bed-Cam486012
 
add BC to CGEWR GJTRoad (Peak)Benefit
Ox-MK618019
Ox-Bed7711033
Ox-Cam125118-7
MK-Bed5535-20
MK-Cam9875-23
Bed-Cam48502
 
    
    
add 30mins 1st& lastmileEWR GJTRoad (Peak)Benefit
Ox-MK9180-11
Ox-Bed1071103
Ox-Cam155118-37
MK-Bed8535-50
MK-Cam12875-53
Bed-Cam7850-28

The Oxford to Bedford benefit remains positive, but National Highways are actively looking at further improvements to the road network between Oxford and Cambridge. Note also that the expensive section between Bedford and Cambridge only has a benefit of 2 minutes in the second section of the table. I recently verified the peak road figure by driving the route at peak time[v].

  1. The time benefit over road can also be viewed as a pair of circles around the origin and destination stations. The question is, will there be enough people living and working inside those circles to justify the railway? With the demise of the Spatial Framework for the OxCam Arc and the million new houses, it now becomes much harder to show that there will be enough people in these rather small circles. Existing housing and local transport patterns by car do not currently support the proposed EWR stations. For example, Cambridge station is slow to get to and the car park (£12.50/day) filled up before 9am pre-Covid. Cambridge south is a destination only station with no car park, attempts to push through a park and ride solution for Cambridge South at Foxton and Hauxton have so far foundered, the view being that the Biomedical Campus needs to provide its own parking rather than dump the problem on neighbouring villages. In any event, park and ride is not a quick solution for the first or last mile for the EWR. There are only 12,000 people in Cambourne the EWR is an expensive way to improve their commute into Cambridge – £417K each!
  2. Looking at ORR’s UK Rail Finances, it seems very unlikely that freight will produce enough revenue to move the needle on the business case for this railway.
  3. Aside from making the new railway very intrusive on the landscape, the ORR no new level crossings policy makes the railway expensive to build and a lot of CO2 will be emitted during its construction. For example, between Cambourne and Hauxton junction we estimate that 866,000 lorry movements would be required to construct the engineering works as specified in the 2021 consultation.
  4. If the capital cost of the railway is to be offset using levies from the construction of new housing, where will these houses be? There is nothing significant in the local plans around Cambridge, Cambridge south or Bedford Midland Road. There are 1950 houses in the local plan around Cambourne that would move if the railway were constructed, but they would also be built if the Cambourne to Cambridge busway were constructed instead – or some similar (cheaper) local transport scheme. If you had a 5% levy on houses selling for an average of £250K and you need to raise £5Billion, then 400,000 houses would be required. That’s a city the size of Leeds.
  5. If these houses are to be constructed in addition to the local plan, they are likely to be on green field sites, such as around the proposed new EWR station at Tempsford. The carbon budget for the railway should include the construction of these houses which are intended to trigger migration into the area and relieve pressure on London rather than solve existing local shortages[vi].
  6. Over the next 10 years, cars will become increasingly electric, powered from a green electricity grid. They will also become autonomous, initially on highways. These trends will continue to erode the benefits of rail over road for passengers.
  7. Given that the public transport along the route of the EWR is not well developed, passengers of the EWR will often have their own cars. They will therefore naturally compare the marginal cost of using their electric car (around 6 pence per mile), with the cost of the railway – looking at Thameslink peak ticket prices this is around 55 pence per mile. Even if the EWR were competitive on travel time then it would not be cost competitive for many.

It’s quite easy to make a case for the railway at a political debating point level. However, the following statements are not justifications

  1. The government strongly supports it.
  2. Railways are green compared with road
  3. It will create jobs
  4. We want it.
  5. We have been talking about it since 1995
  6. We will sponsor apprentices

As they said at my business school. “Don’t tell me, show me.”  If this project is to continue the thousands of us currently living under the blight of these plans would really appreciate being shown, in quantitative terms, why this railway makes sense. We now need proof. People will be much more accepting of the project if they are really convinced that it is a good idea. If you can’t prove the case, for goodness sake say so rather than let this drag on.

Yours faithfully

Dr. William Harrold

Co-founder Cambridge Approaches.


[i] https://dataportal.orr.gov.uk/media/1889/rail-industry-finance-uk-statistical-release-2019-20.pdf

[ii] https://en.wikipedia.org/wiki/Trip_distribution#Gravity_model

[iii] https://sacuksprodnrdigital0001.blob.core.windows.net/regional-long-term-planning/North,%20West%20and%20Central/East%20West%20Main%20Line%20Strategic%20Statement%202022.pdf

[iv] https://nationalhighways.co.uk/our-work/a428-black-cat-to-caxton-gibbet/

[v] https://cambridgeapproaches.org/a-trip-to-bedford/

[vi] https://nic.org.uk/app/uploads/Partnering-for-Prosperty.pdf

5 replies on “Will the EWR Compete with Road?”

The process used to develop the business case is described here. https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/749086/Project_Business_Case_2018.pdf

In January 2021 EWRCo. had not completed the SOC and 18 months on they still seem shy about releasing it. They also have yet to answer my recent (2 months ago) question about where they are in this process.

It has to be better to sort questions like competition with road out before getting to this stage. The problem is that this sort of analysis leads to the need to collaborate with local planning and transport authorities. I can understand the reluctance from EWR Co. under time pressure from a succession of Rail Ministers to avoid getting dragged into that.

The other issue is that once EWR Co. was set up, if the business case analysis shows that there is no case, would they really recommend shutting down the project? It’s hard to be objective when you are already working on the project. So, who is taking an objective view of this case? We can’t see it. DfT staff don’t seem to be in place long enough to get to grips with it and of course EWRCo. are hardly objective.

My thoughts …. The new road from Caxton Gibbet to Black Cat will encourage road travel ….. I would doubt anyone would choose to travel by rail from Cambridge to Milton Keynes and beyond by rail. People prefer a journey by car from home to destination – by the time you have wasted struggling from home to station you are well on your way by road – that is just fact! And the additional cost of parking and rail! Just a daft choice. Roads are also considerably quieter due to new and agreeable ways of working since pandemic. Your presented analysis is unarguable ….. the environmental impact is too great to comprehend this project. The EWR project is like the tale of “The Emperor’s New Clothes” …. when a child points out the naked truth to the foolish people. Great article and well done for sending and sharing with us!

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