Lawyers make pounds 70m from sale of Railtrack

Corporate lawyers have shared out pounds 70m in government fees for drawing up thousands of legal deals for the privatised rail system.

A "complicated legal matrix" involving 11,000 minutely-detailed agreements and leases has been put together, governing every aspect of the railway right down to where a worker keeps his shovel and who owns the cupboard it is kept in. One legal partner said: "To say it's a cash cow for lawyers is an understatement. It's a bloody dripping roast."

Details of the payout are published in this week's edition of Legal Business, which discloses that legal firms have earned up to pounds 15m each for their work. Yet, according to an unnamed government department lawyer: "Several of the contracts will be found wanting in one way or another."

The lawyers blame the speed with which the Government wanted them to act. A partner in Simmons & Simmons told the magazine: "The timescale was very short and that meant pressure. We ended up working on everything at the same time, instead of a logical progression. Making all the bits fit together was like working on a puzzle without having all the bits ready at the beginning."

The Government split up the network into a hundred separate companies, and then left it to the lawyers to create a new industry. Tom Winsor, a partner in the law firm Denton Hall, who was seconded to the Rail Regulator, said: "There is no question it could have been done more simply. It certainly could have involved fewer legal contracts and lower legal bills.

"But the reason why such legal input became so necessary was nothing to do with the lawyers, but the Government's determination to break up the infrastructure and the operators into so many pieces."

Glenda Jackson MP, Opposition Transport spokeswoman, said: "Rail privatisation is a lawyer's dream and a taxpayer's nightmare. There can be no justification for spending such huge amounts of money in this way.

"It is clear the Tories have deliberately sought to ensure that there is no possibility of bringing the network back into the public sector. But a Labour government will prove they have failed, by reinstating a publicly-owned, publicly-accountable system."

Jane McKee, one of the 75 Simmons & Simmons lawyers working on the privatisation of Railtrack, said: "What would happen if Labour or the Liberal Democrats did renationalise Railtrack?

"Ugh, I just don't think I could bear to unravel the whole network we have created."

True Stories, page 9