Fares, rail policy and DfT news

28.03.19

ORR could cut Network Rail managers’ bonuses as new regulatory policies introduced

The ORR is to introduce new regulations to hold Network Rail to account by targeting the areas that have the most serious impact on passengers and funders.

The new regulatory policy will be introduced for the start of CP6, and could see senior managers lose their bonuses for missed performance targets.

The ORR said it will be targeting areas with “the most serious impact and detriment to passengers, freight customers and funders by prioritising progress over process to reach early and pragmatic resolution of problems.”

The new policy will see a ‘three-stage approach’ to holding Network Rail to account, beginning on 1 April.

Stage one concerns the routine monitoring and assessment of Network Rail’s performance, drawing on a range of new data sources to compare local routes.

The policy will place emphasis on assessing the strength of the company’s stakeholder engagement and collaborative working.

Stage two concerns investigation and early resolution of concerns in order to protect rail users, with the new changes seeing the ORR step in earlier when necessary.

The ORR is also proposing new regulatory tools including holding ORR hearings and requiring Network Rail to put in place formal improvement plans at earlier stages.

The final stage is enforcement action when Network Rail is unable to resolve issues.

The new policy introduces an option to impose financial sanctions on routes or the system’s operator which can impact Network Rail management bonuses, avoiding the diversion of funding from the operational railway whilst “making a difference.”

Graham Richards, the ORR’s director of railway planning and performance, said: “There have been significant changes to Network Rail’s business in recent years as well as passenger and user expectations and to reflect this we are now changing the way we hold Network Rail to account.

“Our new approach puts passengers and other railway users firmly at the centre of concerns while placing strong emphasis on Network Rail working together with its customers to solve problems early.

“ORR’s regulation will target the areas that have most serious impact on all rail users, and do so early. Of course, our strongest sanctions remain available to address serious and long-term failures.”

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