27 June 2003
Network Rail directors could earn bonuses worth 60% of their salaries if they achieve performance targets early.
As the not-for-profit company announced its management incentive plan on June 23, it also revealed that train delays totalled 28 years last year, at 14.7 million minutes, compared with 13.4 million minutes in 2002.
Its top five directors will receive bonuses equivalent to 18% of salary if 'stringent performance targets' in its business plan are met. These bonuses will rise to 36% if enhanced performance levels are hit, and to 60% if the April 2005 targets are delivered a year early.
Chair Ian McAllister said: 'We have set challenging targets for improvements in performance. Directors will benefit if passengers benefit. There will be no reward for failure.'
He said there had been a 28% reduction in temporary speed restrictions, and cases of broken rails had fallen by 7%. The incentive plan gives equal weight to public performance, financial efficiency and asset stewardship.
Public performance is defined as the percentage of trains arriving within a leeway period of their scheduled time. Directors can become eligible for the 60% bonuses even if one train in six runs outside this. The other two categories are indexes that reflect the efficiency of operations and the network's condition.
The five senior directors missed out on bonus payments for 2002/03, which includes the last months of the now-defunct Railtrack, because they did not meet service targets.
Despite this, the basic salary for chief executive John Armitt was £450,000, his deputy Ian Coucher was paid £400,000 and the other three directors got £300,000 each.
Bob Crow, general secretary of the RMT trade union, said: 'I wonder if there are any tickets available for the directors' lottery – they seem guaranteed to win.'
PFjun2003
