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McLoughlin scraps role of Network Rail public members in governance overhaul

Patrick McLoughlin has announced that none of Network Rail’s executive directors will receive a bonus for the past year, the role of public members will end and a special director has been appointed with immediate effect.

During the transport secretary’s speech on Network Rail performance, which saw Richard Parry-Jones being replaced as chairman by Sir Peter Hendy, McLoughlin stated that he intends to “simplify” Network Rail’s governance by ending the role of the public members.

Public members are recruited on an annual basis, and their role is to hold the board to account for its management of Network Rail by monitoring the board’s management of the performance of Network Rail against:

  • high standards of corporate governance
  • government operational output specifications
  • its regulatory operational and financial targets

“I thank them for their commitment,” he said. “But the reclassification of Network Rail has changed the organisation’s accountability.”

Richard Brown has been appointed as the special director of Network Rail and he will update the secretary of state directly on progress made at the company.

McLoughlin also noted that it is important we “understand what can be done better in future investment programmes” and that Dame Colette Bowe, an experienced economist and regulator, looks at lessons learned.

She will make recommendations for better investment planning in future and here report will be published in the autumn.

“I know members on all sides of the House value the improvements that are planned to the railway in their area,” said McLoughlin.

Commenting on today’s announcement by the transport secretary, Michael Roberts, director general of the Rail Delivery Group, said: “In delivering a better railway, Network Rail signed up to some highly ambitious targets and improvement plans which we now know have proved too optimistic.

“People and businesses rely on rail and some will be disappointed by the news that certain planned improvements will be delayed. The majority of proposed enhancements will still go ahead, and it is important that the industry, government and regulator learn from this situation to ensure we do better in delivering the future improvements the railway needs.”

See also our other stories from today's announcement:

Parry-Jones pushed out at Network Rail; Peter Hendy takes over

Midland Main Line electrification 'paused'


Joel   27/06/2015 at 19:51

It's pushing credibility that a programme of works announced in April 2014 has some 15 months later been found wanting, and underpinned a lot of transport-related texts in General Election manifestos. Where was the risk analysis to show how reliable the programme resource plan would be? If it was done and approved, by whom and when? What's changed, specifically to make the plan untenable? This smells of saving a not-inconsiderable £38bn, not of a failed plan. We know that Benefit:Cost ratios are fiddled to reach the passmark, and that invariably the timescale lengthens. Benefit:Cost testing is always too myopic for timescale and breadth - we lack the cultural will to get it right, sustainably. A lot of holes in the ground have already been dug and unless either looked after for the future or filled with the intended structures will be money wasted. Getting rid of the public members of the Network Rail board sounds far too much like a reinforcement of secrecy. Public money funds Network Rail, through grants from taxation and fares paid by passengers; all such funding needs transparency to show where it comes from. After 42 years in the transport industries (air, buses, metro and main line rail), in management, operational and admin roles i have a cynicism born of experience and watching abuse of professional standards at a lot of levels. Someone tell me I'm wrong...

Lesf   29/06/2015 at 00:34

No Joel, you are not wrong. Painfully, you are spot on. But there isn't going to be a saving of £38bn, we'll spend it but get a lot less for it. Time to reconsider how we commission rail works?

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