Network Rail CEO Iain Coucher announced today that he’s decided to pass up on his annual bonus - in case it distracts attention from ‘Network Rail’s story of success’ in the last year. Coucher, who has denied claims that he was forced into the decision by penny-pinching Government ministers, could have pocketed up to £300,000 after Network Rail hit most of the targets set for it by the regulator – but he’s instead going to have to make do with his £600,000 annual salary and possible £200,000 in long-term incentives. It’s a hard life.
So does Network Rail really have a success story worth trumpeting? Well, the rail operator hit its targets on track quality and train punctuality – 91% of trains now arrive on time (or no more than 10 minutes late, apparently the same thing these days), which is, somewhat embarrassingly, the highest national figure ever recorded. And with train travel now officially the UK’s safest mode of transport, passenger satisfaction has also never been higher (currently 83%). On the other hand, Network Rail narrowly failed to hit its financial efficiency target – it chopped £1bn of its budget, but only managed to cut unit costs by 27%, rather than the hoped-for 31%. Close, but no cigar.
So all in all, a pretty good showing – and one that would ordinarily entitle Coucher to a big chunk of the £300k portion of his bonus that’s based on annual performance. However, he said today that ‘mindful of current sentiment’ (i.e. the row over MPs’ snouts in the trough and fat cat pay-offs), he’s taken a ‘personal decision’ to pass on it.
This looks like a reference to media claims that he was being leaned on by lovable Rail Minister Lord Adonis: the Labour peer has previously written to Coucher complaining of Network Rail’s ‘serious failure to take account of passenger interests’ over recent line closures, according to the FT. ‘I certainly would not say that Network Rail is incapable of significant improvement,’ Lord Adonis told the paper (displaying Whitehall’s usual propensity for pointless double negatives). He’s also been whingeing that salaries ought to be enough for rail bosses, without any bonuses – which of course is nothing to do with the fact that the Government is skint and desperately trying to save pennies.
It is, however, a slightly ridiculous thing to say, given that Network Rail is obliged have a bonus scheme by the Office of Rail Regulation – the Government regulator. It also makes sense in commercial terms, as Coucher (to his credit) insisted today: ‘Incentivising our people makes sure that the company is focused on what it needs to do.’ But perhaps taking one for the team like this is the best way to ensure the scheme remains in place...
In today's bulletin:
BT loses 15,000 jobs - and £134m
Mortgage cheer as first-time buyers jump by a third
Network Rail boss gives gravy train the swerve
UK workers don't trust social media
Home-working causes headaches and clumsiness