Steve Marshall, the chief executive of Railtrack, has launched a stinging attack on the Rail Regulator, Tom Winsor, blaming him for precipitating the series of events that led to the company's bankruptcy.
He also revealed that Railtrack was poised to announce that 1,000 of its 12,000 workers would be sacked, just before it was placed into administration earlier this month.
He said the proposed not-for-profit structure of the company was "sketchy" and that it threatened to become the "hybrid from hell". He said decision making would be "paralysed" by the bureaucracy which would now run Railtrack.
Mr Marshall, who has resigned his position but will serve out his required six months' notice, told a meeting of the Rail Industry Association that he was forced to go back to the Government for more money after he lost confidence in the regulator – a move that ultimately led to the administration. He pointed to negative public comments from the regulator in June, such as a speech in which Mr Winsor said Railtrack had gone with a "begging bowl" to government. He also said that privately Mr Winsor had been saying that the company was "hawking itself unwanted around Whitehall".
"In response to his remarks," Mr Marshall said. "Our bond spreads deteriorated. They were factually incorrect. We had no contact with government from 1 April [when it agreed to bring forward a £1.5bn grant]."
Mr Marshall said he wrote to Mr Winsor twice in June expressing his concern at the comments but received no reply. Railtrack was looking for £2.5bn from the Rail Regulator in 2002 to cover the costs of the Hatfield train crash in 1999. By July, Mr Marshall said he was sufficiently anxious about signals from the regulator that he decided he must turn directly to the Government for the £2.5bn.
"I was concerned about the treatment we would get in 2002 and the regulatory risk we were facing. It was a long time to wait for such an uncertain outcome," he said.
He offered the Government an equity stake in Railtrack in return for a three-year release from the regulatory regime.
He said Railtrack was "getting the show back on the road" under a five-year plan when it was put into administration.
Mr Winsor said he stood by all his public speeches.Reuse content