Network Rail bosses set to get bonuses

RAIL OPERATOR Network Rail said yesterday it would pay its executives bonuses, despite a furore over pay in blue chip companies, and a possible licence breach at the company.

Directors will share £1m between them as the rail regulator, the Office of Rail Regulation (ORR), investigates claims of a licence breach on its west coast main line. There has been a series of disruptions on the line despite the completion of a £9bn upgrade last year.

The news follows an announcement last month from chief executive Iain Coucher, who waived his £300,000 bonus, saying he didn’t want it to overshadow the performance of the firm which manages the country’s track and signals.

But he’s still set to pocket an extra £200,000 in long-term bonus payments, in addition to his £500,000 annual salary.

The financial year at Network Rail runs to the end of March, and includes three months of disruption which affected the west coast after a new timetable was implemented.

The firm posted pre-tax profits of £1.52bn, and the best punctuality figures on the network since 1992, which Coucher said justified the payout.

But the ORR has written to Network Rail’s remuneration committee, saying it had to explain why the bonuses were paid, given the current financial climate.

Network Rail said last year it expected its debt to rise to £30bn by 2014 as it invests in expanding and renewing the railways. The firm, whose profits are put back into the railway, invested £4bn in the network the previous year.

Network Rail also reported a rise in its pension deficit to 33 per cent, up from 17 per cent last year, as the value of its pension fund assets fell by 25 percent to £2.21bn.