'Arrogant' German rail chief quits over spying row

The controversial head of Germany’s state-owned rail network, Deutsche Bahn, was forced to resign today amid a deepening privacy scandal in which the company admitted spying on thousands of its employees.

Hartmut Mehdorn, who has run Germany’s largest rail company for a decade, stepped down after the Chancellor Angela Merkel revealed that she had withdrawn her support for the embattled executive.

The 66-year-old rail chief, who has a reputation for arrogance, said he had been unable to cope with the "destructive debate" he said was damaging Deutsche Bahn. Handing in his notice, he added: "The prejudice, suspicion and speculation had reached such a level, that even I could bear it no longer." The resignation was the climax to a long-running saga in which the management of the German rail network has been accused of using Stasi-style methods to snoop on thousands of its employees as part of a so-called anti-corruption drive.

Early this year, information leaked to the German media suggested that the rail network had been checking confidential staff data which went back as far as 1998. In February, Mr Mehdorn admitted that Deutsche Bahn had spied on 173,000 of its 220,000 employees during 2002 and 2003.

Evidence later emerged showing that the entire workforce had been screened again in 2005 to check they were not passing on confidential company information to outsiders. The records implied that all of Deutsche Bahn’s employees were spied on three times and that 800 of its senior managers were checked up on twice.

Paranoia within Deutsche Bahn management was evidently widespread. Last week government investigators found out that in its attempts to root out internal critics, the company had also monitored staff emails to check whether employees had contacted journalists or MPs. They said that at times the company was trawling through 145,000 staff emails every day.

What appears to have been the last straw, came over the weekend, when Deutsche Bahn management was obliged to admit that in 2007, during a rail dispute, it deliberately deleted emails sent by the German train drivers’ union to its members that urged them to go on strike. Until today Mr Mehdorn had dismissed suggestions that he should resign over the affair. Claiming that there was nothing illegal in spying on his employees, he insisted the measures were justified to combat corruption. By early today however, MPs from all parties were calling for Mr Mehdorn’s scalp. Crucially Ms Merkel, who had been a steadfast ally of the rail chief, withdrew her support, conscious of a general election just five months away.

German rail unions had long regarded Mr Mehdorn as a hate figure. Placards at union rallies accused him of "acting like the Pope". But it is not only rail workers he offended. Last year he was criticised by Jewish groups for charging the organisers of a rolling train exhibition about the Holocaust for using the German rail network. In 2006, he also refused to allow a French exhibition about the role of trains in the Holocaust to be shown at German stations, saying that the subject was "too serious for people who are munching a sandwich or boarding a train".