Commuter fury at rail chief's big bonus

LONG-SUFFERING rail users in East Anglia said they were “horrified” last night after Network Rail's chief executive received a bonus of more than £500,000.

Craig Robinson

LONG-SUFFERING rail users in East Anglia said they were “horrified” last night after Network Rail's chief executive received a bonus of more than £500,000.

News of the bonus came as Network Rail - a not-for-dividend company which has no shareholders - also announced an after-tax profit of £1.2billion for 2007/08.

The revelation has angered commuters from Suffolk and Essex, who for months have been plagued by problems on the Norwich to London mainline.

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Over-running repair works around Liverpool Street at Christmas and Easter led to chaos while ongoing weekend maintenance continues to cause disruption to services.

But yesterday Network Rail revealed chief executive Iain Coucher has been paid an annual bonus of £306,000 along with an extra £205,000 under the company's long-term incentive plan.

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With his salary of £585,000, his total pay this year will exceed £1m - despite missing targets for punctuality and financial efficiency.

David Bigg, chairman of the Witham and Braintree Passengers Association, said most rail users would be “horrified”.

“I'm absolutely appalled,” he said. “I think he should follow the example of Willie Walsh, the chief executive of British Airways, who gracefully declined his bonus because of the problems surrounding the opening of Heathrow's terminal 5.

“It's perfectly lawful for him to take it but I think it would be offensive to most rail users because the bonus seems to be based on the profit level rather than the performance.”

Neil Skinner, chairman of the Manningtree Rail Users Association, said: “It's shocking - there is something clearly wrong with the system. If he declined the bonus then it would send out all the right messages - 'we are doing ok but we know we can do better and we know we got it wrong.'

“So far we haven't seen any justification for this and needless to say we will be looking for a much better performance in the future.”

Despite Network Rail's profits, its net debt rose from £18.4 billion in 2006/07 to £19.7 billion. The after-tax profit figure for 2007/08 was up from £1 billion recorded in the previous 12 months.

Tim Yeo, Conservative MP for South Suffolk, has now called on bosses to review the price Network Rail charges for train operators to use its tracks - claiming it could help reduce fares for members of the public.

“People are quite rightly outraged,” he said. “It's hard to see how a business that seems to let its customers down so badly can perform so well.

“In light of these profits I think there is a justifiable case for a review of how much Network Rail charges the train companies to use its infrastructure - I think people can feel quite aggrieved by that because it is reflected in the price they have to pay for fares.”

Earlier this year the Office of Rail Regulation (ORR) fined Network Rail a record £14million because of over-running engineering works at Liverpool Street, Rugby in the West Midlands and on the West Coast Main Line.

As a result the watchdog tried to intervene in the bonus process by pointing out the failures to the company's remuneration committee.

But Network Rail confirmed its three top directors were all getting performance-related annual bonuses of more than £200,000 - although the 30 most senior managers will have their bonuses cut by 14% to reflect the company's regret over the disruption.

Sir Ian McAllister, Network Rail chairman, said all profits were re-invested back into infrastructure.

“Lessons have been learnt following the engineering overrun,” he said. “Changes have been made to make the planning and execution of such big improvement schemes more robust.

“Overall, the last year has been a good one for Network Rail and the industry as a whole, with passengers seeing a better service.

“Train performance is at an all-time high, a £4bn investment programme has been delivered, delays caused by the infrastructure have been cut and costs have also been reduced.

“No form of transport is safer than rail and record levels of investment are being pumped into the network, with a doubling of spending on schemes designed to build a bigger, better railway to help meet the growing demands of passengers and freight users.”

A spokesman added that all track access charges are set by the Office of Rail Regulation.

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