Rail bosses face tough questioning

Bosses at Railtrack successor Network Rail were expected to face tough questioning on spending and bonuses at the company's first annual meeting today.

Rail costs are soaring and performance is not likely to reach the level achieved before the October 2000 Hatfield crash for some years.

Yet directors of Network Rail (NR) - a not-for-dividend company - stand to gain bonuses for meeting various targets in 2003-04.

NR's top managers did not get any bonuses for 2002-03 after failing to meet all
their targets, although there were £1.8 million of payouts made in relation to Railtrack going into administration in October 2001.

Questions at today's meeting in Glasgow were being posed by some of the company's 116 members who effectively act as shareholders.

One member - Bob Crow, the general secretary of the biggest rail union, the RMT - said: "Network Rail should be leading by example. Their executives could start by handing back the £1.8 million in bonuses they've just been handed, and accept the 4.1% increase our members had to make do with."

He went on: "We're facing the threat of one in ten services facing the axe - that's not efficiency, that's madness. The railways need sustained public investment - but it's no good if the private sector are just going to suck it straight out again in profits."

Mr Crow was also pressing for the amalgamation of NR with the Strategic Rail Authority to create a "single, sensible railway body".

Another member - business economics lecturer Rob Branston - has called on his colleagues to vote against the reappointment of NR's auditors Deloitte & Touche.

Mr Branston has said he has nothing against the present auditors but felt that members should make an early "show of teeth" to indicate to management that members meant business.

But the Association of Community-Rail Partnerships, which was being represented at the meeting, offered support for the directors.

"Network Rail is a brave and innovative project which could have many lessons to offer for the ownership and management of other public utilities," said Acorp general manager Dr Paul Salveson.

He went on: "Public members have an important role to play not just in turning up and voting at AGMs, but in offering support to Network Rail's directors, and all the staff, in the many challenges they are facing."

In 2003-04, NR top management could receive up to 60% of their basic pay as bonuses, but only if they hit targets on punctuality, financial performance and stewardship of the network.

Rail Regulator Tom Winsor has expressed alarm at NR's spending and is due to announce shortly a new track access charging regime which will state just how much NR can charge train companies for using the network.

Last week the Rail Passengers Council said that NR still had "a long way to go" in its efforts to improve the network.