Fw: Rail bosses face pay cut after crash

[John Ashworth]

Rail bosses face pay cut after crash


Network Rail admits failure and agrees to slash director's bonuses ahead of the Greyrigg inquiry

Juliette Jowit, transport editor
Sunday May 20, 2007
The Observer

Network Rail directors are to have their £1m bonuses cut this week after taking responsibility for failures in reducing train delays and for the first fatal accident in five years.

Network Rail will publish full-year results on Thursday showing that the company made its first full-year operating profit since it took over following the collapse of Railtrack, but the company will admit that it has failed to make inroads into the 10.5 million minutes of delays per year faced by passengers.

The government-backed company has also admitted responsibility for the fatal accident at Greyrigg, Cumbria, last February, when a Virgin high-speed train was derailed by broken points, killing one person and injuring more than 20 more passengers.

Last year Network Rail paid its top four executive directors total bonuses of more than £1.1m, taking their combined pay, including pension contributions, to more than £3.3m. The company said yesterday that it would not comment on the bonus decision, but confirmed it had missed the target to reduce its delays to below 10m minutes, and that safety was a key criterion for the remuneration committee which decides the final figure.

Chris Rumfitt, Network Rail's head of communications, said: 'The system is based on three things: punctuality, financial efficiency and the condition of the assets. Then there's an overlay which is the remuneration committee's discretion if there are any other factors they wish to take into account to do a reduction from that.'

Within weeks Network Rail is expected to face a damming report into safety failures which caused the Greyrigg accident, including criticism of maintenance inspections and record-keeping. Yesterday there were calls for directors to reject or slash their bonuses in response to the crash. Bob Crow, general secretary of the RMT railway union, said: 'I'm not opposed to them having bonuses, but they should be put on hold until after the outcome of [the] Greyrigg [investigation].'

Keith Norman, general secretary of the Aslef drivers' union, said bonuses should be axed because of Greyrigg and the £4m fine announced in March for Railtrack's part in the 1999 Ladbroke Grove crash, for which Network Rail inherited responsibility when it took over in 2002. 'It's inconceivable to us that in the shadow of these two terrible incidents people are still prepared to pick off bonuses,' said Norman.

Chris Grayling, the Conservative shadow Transport Secretary, said no bonuses should be paid in the industry because of an 'overcrowding crisis'.

Network Rail denied RMT claims it had been forced to review 'their entire maintenance programmes' in light of the Greyrigg accident. 'If there was something fundamentally wrong with our maintenance strategy we wouldn't have as good a safety record as we do,' said Rumfitt.

It is also not certain the company will meet its target to improve the condition of the assets, another key condition of bonus payments. The Office of the Rail Regulator's last review said improvements had 'stalled', but that Network Rail said it would meet the goal.

· South West Trains, Britain's biggest train operator, will tomorrow put up off-peak fares by up to 21 per cent, and passengers on Arriva Trains in Wales will see ticket rises of up to 34 per cent.