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Tax-payers should not be funding an £11.7m bonus scheme for Network Rail managers and the Transport Secretary must act.
In response to further leaks that reveal plans for a long term bonus scheme at Network Rail worth £11.7million and revelations that the Transport Secretary has failed to keep her promise to appoint a Public Interest Director, Labour has called for:
· Network Rail to abandon plans to pay immediate bonuses of £300,000 to three senior directors and adopt a further bonus scheme costing £11.7m;
· The Government to take on responsibility for appointing a Public Interest Director;
· The Transport Secretary to attend Network Rail’s AGM on 19th July and vote against the bonus proposals on behalf of tax-payers and fare-payers;
· To update parliament on steps to improve Network Rail’s corporate governance.
Maria Eagle MP, Shadow Transport Secretary, said:
"Network Rail is a publicly-funded body that receives £4 billion of tax-payers money every year. In the current economic climate, and with a performance that is far from satisfactory, it is hopelessly out of touch for Network Rail to believe that an £11.7m bonus scheme for senior managers is acceptable. Passengers are facing annual fare rises of 11 per cent a year at a time when people are really struggling to make ends meet. This bonus culture, greed and free and easy attitude to taxpayers money must end. Instead of unacceptably describing the Rail Regulator’s warnings as unhelpful, Network Rail must listen to his warnings that their bonus plans are in breach of their licence obligations.
"When Network Rail first tried to get away with adopting a bonus scheme in February, the Transport Secretary promised to appoint a Public Interest Director, yet nearly six months on she has failed to do so. In fact, it appears that this appointment is to be made by Network Rail themselves. It is a complete farce for the person who is supposed to be the independent voice speaking up for passengers and taxpayers to be appointed by the very people who’s decisions they should be scrutinising. This is corporate governance of the worst kind. It is increasingly clear that this is an organisation in desperate need of serious reform to restore accountability to the public. The Transport Secretary should now come before parliament to set out proposals for reform.
"Under pressure from Labour earlier this year, the Transport Secretary admitted that she had the power to vote against Network Rail’s remuneration proposals. If the Government is serious about standing up for passengers and taxpayers, Justine Greening must confirm that she intends to attend Network Rail’s AGM on 19th July and vote against these unacceptable publicly-funded bonuses."