We support the People's Rail campaign to give the British public real power over its rail network.
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Long-suffering rail users deserve better than a network run for the convenience of managers, with no one taking responsibility when things go wrong.
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We call on Network Rail to change the way it's run, to give real control to passengers and the public.
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The People's Rail is a
Co-operative Party Campaign.
Copyright 2008,
The Co-operative Party.
Website by
Furber Consultancy
Network Rail is widely acknowledged to be underperforming. We feel that a significant factor in this is its Board’s failure to be accountable to anyone but itself. We also believe there is a simple solution that would be welcomed by the train operating companies, the staff and, most importantly, the long-suffering passengers.
Network Rail was created by the Government in 2002 as a response to the failure of Railtrack, which went into administration against the backdrop of its poor safety record and financial collapse.
Since October 2002, Network Rail has reduced delays and improved safety compared to its predecessor. It has also performed well financially, making a £1.6 billion pre-tax profit this year. As Network Rail is a ‘not for dividend’ company, this will be ploughed back into the transport infrastructure. However, while Network Rail is performing better than Railtrack, it is still a long way from the service that we deserve.
Performance
A key concern is Network Rail’s lack of operational efficiency. Even taking into account the historic under-investment in Britain’s railways, Network Rail underperforms against the European average by £846 million per year for renewal and £263 million for maintenance.
The 2008 New Year engineering overruns caused, in the words of the Rail Regulator, ‘a serious and unacceptable disruption to rail users and train operators.’ While the breakdown in project management that occurred in January could have happened in any type of organisation, the manner in which Network Rail responded begs a question as to whether it is suitably concerned about the needs of passengers and the British public.
Some would say Network Rail’s lack of regard for rail users was apparent even before the overruns occurred. In December, a member of the ORR Railway Inspectorate informed Network Rail that, in his view, it would be possible to keep one track open through Rugby for the entire holiday period, albeit for diesel trains only. Network Rail told him that there would be no demand for this. Would the thousands of passengers forced to make alternative transport arrangements have thought otherwise?
Despite the overruns in Rugby and Liverpool Street being apparent to the company for some time, Network Rail notified the train operators only hours before services were due to come back on line. This meant that neither Virgin Trains nor ‘One’ were able to make any arrangements for alternative travel or inform passengers, creating chaos and misery for tens of thousands of travellers as they attempted to return to work after the festive period.
This incident is just one prominent example of a broader failure to deliver. Passengers, train operators and the Office of Rail Regulation are all unhappy with Network Rail’s current performance, and believe that there are fundamental issues that its management and board need to resolve. The Office of Rail Regulation imposed an unprecedented fine of £14 million for this failure, yet what was the Network Rail Board’s response?…
At a time when one might expect the future of the management to be in the balance, the Board has instead congratulated them for ‘a good year for their staff and the public.’ Rewards have flowed to their most senior employees; with their three executive directors each receiving performance related bonuses in excess of £350,000.
Governance
The current governance structure of Network Rail is failing both passengers and the wider rail industry.
In effect, the Board appoints Network Rail’s members. While an independent panel selects the members, this is effectively appointed and remunerated by the Board as well. This puts Network Rail’s Board in the unparalleled position of being able to choose those to whom it is accountable. Many criticised the unchecked powers of media tycoon Conrad Black, but even he was not in the same enviable position of being able to select his own shareholders.
The People’s Rail
The People’s Rail Campaign has been launched to remedy this situation. We believe that long suffering passengers deserve better than a network run for the convenience of an unaccountable Board, and that the British public deserve real control over how the network is run.
Putting all arguments around corporate governance to one side, Network Rail should be accountable to passengers and the public for one simple reason alone – because we pay for it. In 2006/07, Network Rail’s subsidy cost the average household approximately £240. Passengers made additional contributions, with £4.16 of the average fare going towards the company’s operations.
For Network Rail to become truly accountable, all citizens must be given the right to become individual members. As a genuine mutual venture, Network Rail would then give all of its members the right to elect governor representatives to a Members’ Council, which would replace the role currently fulfilled by its existing membership. Industry members could continue to be nominated by their respective interest groups - be they train operating companies or trade unions.
Network Rail would be structured so that all of its members have a voice. This could provide a genuine forum for informing and, where appropriate, consulting with citizens. It would provide information that would ensure that passengers remain fully informed of its progress in improving the network, a focus for ensuring that the network’s links with passengers remain strong.
A 2007 opinion poll conducted by YouGov for the Co-operative Party suggests that there is much affinity for this type of governance. 81% of regular users of public transport surveyed felt that they did not have enough of a say in how it is run.
Open membership systems deliver organisations that act in the consumer interest. If we are to get the rail network the British public want and need, Network Rail needs a structure that delivers real accountability – not just a pretence.
We believe that Network Rail has to change.
We welcome news that the ORR has launched an independent review of Network Rail’s governance as an important first step. But a real transformation is in the power of Network Rail’s members. They can make this happen.
This is why we are launching the People’s Rail campaign, for lasting change as set out in the People’s Rail Charter.
The People’s Rail Charter:
