Railway investment delivers £3.2bn boost to UK businesses

Investment in the rail network generated more than £3.2 billion of work for businesses across Britain over the last year, according to new figures from Network Rail.

More than a third – around £1.2 billion – of the money spent in 2012/13 went to small and medium-sized businesses, helping support economic growth and jobs across a range of industries from telecoms suppliers and glazers to solar energy engineers and security providers.

This investment has sustained more than 90,000 full-time jobs nationwide in addition to the 34,000 people directly employed by Network Rail, generating significant financial returns to central government through tax revenue and savings on benefits as well as boosting local economies.

Chief Secretary to the Treasury, Danny Alexander, said: 'Investing in infrastructure has a direct effect on the economy, creating jobs, and giving Britain the infrastructure we need to build a stronger economy and fairer society. I’m very glad to see that Network Rail are doing their bit to drive sustainable and balanced economic growth across the UK.'

The rail industry’s supply chain is both extended and varied, ranging from professional services to the construction industry. Rail investment is therefore an important driver of growth across many of the UK’s industrial sectors.

In the last four years, Network Rail has generated £17.3 billion of work for its supply chain, of which £6.2 billion has been with small and medium-sized businesses – a 22 per cent increase on the previous four years. Planned enhancements and renewals expenditure between 2014 and 2019 is approximately £25bn, with 99 per cent of this work to be undertaken by UK-based companies.

Capital investment in rail also pays back over the longer term through wider socio-economic benefits. A good example of this is the Northern Hub project which delivers wider economic benefits valued at over £4 for every £1 invested. It has been estimated that this project alone will deliver an annual contribution to the northern economy of £2 billion.

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