Network Rail are in the midst of a massive funding crisis, particularly on CP5 framework packages. A lot of the CP5 schemes were priced in 2008 (badly!) and now the current estimates for the schemes are must higher. This has meant the CP5 budget doesn't cover the workbank originally agreed with the ORR, so a lot of schemes are being deferred to CP6. Essentially the RAMs have lists of schemes they need/want to deliver but they haven't got the cash to do so.
Example is LNW earthworks which I am directly involved with.
In terms of this 'ban' on recruitment, I can't say I'm at all surprised.