Network Rail could face hefty fines after the industry regulator opened an investigation into punctuality and reliability on some of the busiest commuter routes.
The Office of Road and Rail (ORR) said reliability on routes such as Southern, Thameslink and Scotland was “below requirements” in 2014-15. The overall trains-on-time figure was 89.6 per cent – nearly 3 per cent lower than Network Rail’s target of 92.5 per cent, the ORR added.
The inquiry comes as the company, which is trying to ward off national rail strikes and is under fire for causing passenger chaos during engineering works, announced that its profits have halved from £1.035bn to £506m in the financial year to 31 March.
The not-for-profit company, which runs Britain’s railway lines, blamed the dramatic drop in pre-tax profits on the rail regulator’s decision to slash its income for this and the next four years.
Network Rail’s income was £246m lower than last year, which led to lower operating profits. It has also been hit by accounting rules that have forced it to record some non-cash losses on derivative hedging deals, although these have no impact on what it can spend on the railway.
The company’s debt also widened considerably from £33bn to £37.8bn – a sum that has now been moved on to the Government’s balance sheet, following the company’s reclassification as a public body last year by the European Union.
The rail group, which has been criticised for widespread disruption to passengers in recent months, said it was investing £100m a week to upgrade the country’s railways.
Patrick Butcher, the group director of finance at Network Rail, said: “With more than a million more trains on the network than 10 years ago, there are inevitable challenges. We are determined to do more to improve and action is being taken to quicken the pace of change.”
Spending on the railways is now double what it was five years ago and includes £2.9bn a year on replacing worn-out track and infrastructure.
Despite the disruption caused by works at two of the capital’s biggest stations – London Bridge and Victoria – the total number of rail passengers in the year grew by 67.3 million, hitting a new record for modern times of 1.65 billion passengers a year.
Network Rail said that the huge growth in passenger numbers was one of the reasons it was not hitting its punctuality targets.
The company was fined £77m during 2014 for missing punctuality goals.Reuse content