Bonus scheme 'rewarding failure'

Network RailA multi-million pound bonus package paid by the taxpayer could be winging its way to Network Rail, despite criticism the firm failed to meet targets.

The not-for-profit company is to vote on a controversial pay scheme for its top brass over the next three years.

The move has prompted an angry reaction from unions, who said if the payments were given the go-ahead it would be like "rewarding failure".

The Transport Salaried Staffs Association's (TSSA) general secretary Manuel Cortes said: "Rail passengers, who have seen fares increase by 16% since the last election, will simply not understand why bosses are rewarding themselves on a first class gravy train, while they are suffering a second class service."
Network Rail, which manages around 20,000 miles of track, gets about £4 billion a year in subsidies from the taxpayer. Earlier this year, it was threatened with record fines of £75 million by the Office of Rail Regulation if it did not meet punctuality targets. According to figures, Network Rail managed 87% punctuality, with 361,000 commuter trains and 70,500 long distance train services cancelled or late.

Network Rail has also prompted criticism for its safety record at level crossings. In 2012, it admitted health and safety breaches over the deaths of two teenagers killed at a level crossing.

Last year, following political pressure, bosses waived a bonus package and instead allocated their windfall to a safety improvement programme. But in May, reports began to circulate that Network Rail was looking to implement the bonus scheme at its AGM on July 18. That prospect has seen unions vow to protest outside the meeting, which takes place in the Parc Hotel, Park Place, Cardiff.

A TSSA leaflet is due to be circulated to voting members, stating: "You are being asked to vote in favour of a bonus and pay package for NR's five executives which could be worth more than £11 million by 2015. The proposed new long-term bonus, worth 100% on top of annual salary by 2015, is reserved exclusively for the executives. The rest of the 35,000 strong workforce will be excluded. We think that is wrong and would urge you to vote against the new double bonus plan at your meeting today."

A Network Rail spokesman insisted senior executives were only rewarded when "exceptional performance exceeds tough targets" which had been approved by members in "an open and transparent process". "If targets are not met, or safety compromised, no bonuses are paid," he added.

The Department of Transport said it was the Office of Rail Regulation's job to ensure that Network Rail's bonus scheme was transparent. A spokesman said: "Ultimately, Network Rail is responsible for these payments and it is a myth to suggest that ministers have any powers of veto over any payments."