Anger over £1m pay deals for rail bosses as fares keep going up

Pay figures emerge as poll of passengers reveals commuter dissatisfaction

Members of the public disembark a National Express train (Getty Images)

Rail bosses are being handed pay packets worth as much as £1.4m while commuters are being hit with rising ticket prices, according to figures published yesterday.

Information obtained under the Freedom of Information Act showed that eight executives on the East Coast line, where services are being run by the public sector, were revealed to be on £100,000 or more, with the highest paid on a salary of between £161,000 and £180,000.

Two other East Coast directors are being paid between £121,000 and £140,000 and five more between £100,000 and £120,000 a year. The revelations are likely to cause anger among commuters, who were hit with above-inflation price hikes less than two months ago.

And executives at Go-Ahead, FirstGroup and Network Rail were getting deals worth more than £1m when assorted bonuses and other benefits were taken into account.

Meanwhile, a passenger satisfaction survey published today by consumer magazine Which? shows that more than half of the companies running Britain’s train network were given scores of less than 50 per cent. The research showed that only 22 per cent of train users felt the service they received was improving, despite rising ticket prices.

Figures from other operators showed more six-figure salaries being doled out in boardrooms across the industry. The 10 directors at CrossCountry, which runs services mainly in the West Midlands, were paid £795,000 in total in 2011 with the highest paid taking home £222,000 including pension contributions.

It was revealed last month that ScotRail boss Stephen Montgomery received a £54,000 pay rise, taking his salary up to £333,000 in 2012.

The company is owned by FirstGroup, where chief executive Tim O’Toole was paid £846,000 last year, plus a £134,000 pension contribution and £75,000 as benefits in kind. Accounts showed that, in the year ending March 2012, FirstGroup made an operating profit of £110.5m on its UK rail business.

Network Rail, which is currently fighting to meet targets on punctuality, paid its chief executive Sir David Higgins an annual basic salary of £560,000, while finance director Patrick Butcher was on £382,000. Two other executives, Robin Gisby and Simon Kirby, were paid salaries of £360,000.

National Express chief executive, Dean Finch, is paid a salary of £550,000 in a deal which was worth more than £1.4m in 2011 with bonuses and other benefits. National Express group finance director, Jez Maiden, is on £420,000 a year and his deal was worth more than £1m with additional benefits. Chairman John Devaney, who is about to stand down, was on £225,000.

Accounts also showed that Go-Ahead chief executive David Brown’s salary was £510,000 but his deal was worth £900,000 after a bonus was added, with finance director Keith Down on £326,000.

Manuel Cortes, leader of the TSSA rail union, said: “One of the reasons we have the highest rail fares in Europe is because we have created an army of Fat Controllers since John Major sold off British Rail 20 years ago.”

None of the train companies responded to requests for comment.

Fast track: The fat controllers

Tim O’Toole

The FirstGroup chief executive’s remuneration package was worth more than £1m last year. The American executive left a lucrative job with London Underground – where he earned the CBE for his response to the London 7/7 bombings – to join FirstGroup.

Sir David Higgins

The Network Rail boss waived his right to a bonus of up to £340,000 under ministerial pressure in 2012. Justine Greening, then Transport Secretary, criticised plans to allow him as much as 60 per cent of his £560,000 salary.

Dean Finch

National Express’s Group Chief Operating Executive was reportedly allowed a bonus of up to 150 per cent of his £550,000 pay to stay at the firm after being approached by other groups.

David Brown

The Go-Ahead chief, who is paid £510,000, has spoken recently of the challenging politics inherent in an industry receiving public funding.

Jez Maiden

The Finance Director at National Express, who has previously served in the same role at Northern Foods, British Vita and Britannia Building Society, is paid a salary of £420,000.