Railtrack chief takes pay rise but refuses bonus

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The Independent Online

The chief executive of Railtrack moved to defuse criticism of his £50,000-a-year pay rise yesterday by waiving a much bigger annual bonus and lucrative share option rights.

Steve Marshall had been attacked by MPs, unions and passenger groups because he had been awarded a 12.5 per cent pay rise.

However, in a statement yesterday, Mr Marshall said he had decided not to participate in the annual bonus, which entitles him to receive up to 50 per cent of his £450,000 salary.

Nor will he take part in the executive share option scheme and he will cancel his existing share option entitlements, normally worth the equivalent of a year's salary.

The concession came as thousands of passengers on the Eurostar route between London, Paris and Brussels suffered delays of more than six hours after a Connex commuter train broke down near Sevenoaks, Kent, on Sunday afternoon.

Three services to Paris and one to Brussels were cancelled in the aftermath of the breakdown, which forced inbound and outbound Eurostar services to share a single track on the approach to the London Waterloo terminal.

By 4.30am yesterday, four trains that should have arrived at Waterloo before midnight were still waiting on the tracks outside the station. Services did not return to normal until after 9am.

Mr Marshall, whose company is facing huge financial penalties from the Rail Regulator, Tom Winsor, for failing to reduce train delays, will not reject the pay rise as part of his voluntary concessions. He will also retain a special bonus performance opportunity of up to one year's salary. Other senior Railtrack executives are holding on to all their entitlements.

Railtrack said it was already reviewing all boardroom remuneration in response to the outcry over the £1.4m pay-off for its former chief executive, Gerald Corbett.

John Robinson, Railtrack's new chairman, said the review would take into account that while Railtrack was a commercially owned company it provided a public service and was heavily reliant on funding from the taxpayer.

The new pay arrangement, which will be introduced next year, will be much more closely tied to achieving passenger service and punctuality targets rather than financial targets.

The Trade and Industry minister Lord Sainsbury of Turville held back from directly attacking Mr Marshall's pay rise in the House of Lords yesterday. "It's for the shareholders to decide. I am actually delighted, in this case, that it will be on the agenda for the AGM, where no doubt shareholders can express their views," he said.

But the Labour MP Gwyneth Dunwoody, who chaired the Commons transport select committee in the last parliament, condemned Mr Marshall's salary increase.

"The reality is that the railway system is still not right, and a lot of people are still paying increased fares for a worse service," she told BBC Radio 4's Today programme. "It is about time they realised that they have got to lead from the front."

Meanwhile, the head of Virgin, Sir Richard Branson, unveiled the first of his new £1bn fleet of tilting trains yesterday. Two decades after the Advanced Passenger Train (APT) proved such a flop for British Rail, the 140mph Fiat-designed Pendolino completed a maiden outing on a 12-mile Leicestershire test track, tilting as it negotiated bends without leaving its passengers feeling sick.

Sir Richard unveiled the first Virgin Trains Pendolinos to the theme tune from Mission: Impossible. That, say the sceptics, describes the task facing Railtrack as it struggles to upgrade the west coast main line.