Network Rail chief executive Iain Coucher announced today he will not take an annual bonus this year.
But he will still be eligible for a possibly substantial bonus as part of the Network Rail (NR) long-term incentive plan.
And other top directors of the rail infrastructure company are expected to take annual bonuses as well as the long-term bonus.
Last year, Mr Coucher received a £305,000 annual bonus as well as more than £200,000 under the long-term incentive plan, with the awards being based on NR's performance on meeting certain targets.
The bonuses were paid out despite NR being fined a record £14 million for three serious engineering overruns over the 2007/08 Christmas and new year period.
NR's remuneration committee is due to announce this year's bonuses shortly.
Mr Coucher said: "Today I want to be able to talk freely about Network Rail's story of success and how it has delivered for passengers, not just last year but over the last five years without this story being clouded by controversy.
"In the last 12 months we met or exceeded almost all of the tough targets set for us by our independent regulator.
"I know that there is much more we need to do to deliver a consistently high quality service to all rail users and I am committed to doing just that in the coming years.
"As a result of everything the industry has done, we now have a railway carrying a record number of passengers on a record number of trains.
"Passenger satisfaction at 83% has never been higher, 91% of trains arrive on time - the highest national figure ever recorded.
"Travel by train has never been safer and is now the safest form of transport and we have reduced by £1 billion a year for the British people the cost of running the railway."
He went on: "Nonetheless, I am mindful of current sentiment, so I have taken a personal decision to forego any annual bonus this year. The success of our company and its hard-working people must have the opportunity to be seen and heard.
"Our people have secured this success and every one - from signal box to boardroom - will deserve any bonus which may be awarded to recognise this.
"Incentivising our people makes sure that the company is focused on what it needs to do. Our people have delivered what has been asked of them and more. I believe we must honour the deal to reward their collective success."
Last year, NR paid out £55 million in bonuses, with all staff receiving at least £871. The NR targets are set by the Office of Rail Regulation (ORR) and relate to train punctuality, how well NR has looked after the railways and the extent to which the company has made savings.
But the ORR has no direct influence on bonuses, which are a matter for the NR remuneration committee.
Gerry Doherty, leader of the Transport Salaried Staffs Association rail union, which has been campaigning for all bonuses to be scrapped for all NR directors, said: "I am pleased that Iain Coucher has finally bowed to the inevitable and listened to what (Rail Minister) Lord Adonis, the ORR, ourselves and the public have been saying for the past four months.
"There is never any justification in paying bonuses for running a state monopoly and, in view of the chief executive's £500,000-a-year salary, there is even less justification this year, given the public outcry over bonus rewards for failure.
"His claim that he is finally making the trains run on time is risible, given that his punctuality figure of 91% was frequently passed by British Rail, who never claimed, like he does, that trains arriving up to 10 minutes late are, in fact, on time."
Louise Ellman MP, chairman of the House of Commons Transport Committee, said: "We welcome Mr Coucher's decision, but NR must improve its efficiency so that the national railway does not come to a virtual halt on bank holidays.
"It must be possible to repair the railways without shutting the system down."
She went on: "In our report last year on the Government's 30-year plan for the railways, we said we found NR was very inefficient compared with its European counterparts."
Lord Adonis said: "I warmly welcome Iain Coucher's personal decision to forgo his bonus. It shows true leadership and a responsiveness to the public mood at this time of national economic hardship."Reuse content