Two contractors will be dropped from Network Rail's track renewal framework after review in 2007

Network Rail is to cut the number of track renewal contractors it uses from six to four as part of shake-up aimed at saving £150m.

Amey SECO, Balfour Beatty rail, Carillion Rail, First Engineering, Grant Rail and Jarvis will undergo a six month review from January. The review will look at safety records, volumes achieved, finishing jobs on time, unit costs and business behaviours.

Network Rail said the review of its contractors combined with the streamlining of processes would save it £150m over the next three years.

It said: “By focusing on four suppliers that pace of cost savings can be accelerated. Over the past two years, 12% efficiency savings have been achieved.”

A decision on the successful contractor will be announced in mid 2007.

The decision to assess its contractors follows a six month review of the way track renewals are carried out which found that the current supply market is too big for future needs.