Network Rail chiefs cut board out spending decisions

Network Rail bosses have been blasted by union and industry leaders after attempting to “free-up board time for more strategic issues”.

The move to delegate top-level cost and contract controls was described as “cavalier”.

The owner of most of Britain’s rail infrastructure, including 20,000 miles of track and 19 major stations, has been widely criticised for a debt burden of more than £33bn. This was dumped on to the Government’s balance sheet when National Rail was in effect renationalised on Monday.

But the Evening Standard’s sister paper The Independent revealed that its chief executive, Mark Carne, has delegated approval for projects and contract awards worth up to £750m from the board to the executive committee.

Previously, the board had to approve all deals worth more than £150m. While Mr Carne sits on the executive committee, the move means non-executive directors charged with scrutinising Network Rail’s activities, such as its chairman Richard Parry-Jones, would only approve the biggest projects and contract awards.

Projects worth several hundred million pounds are likely to be rife on a programme that includes electrifying more than 850 miles of railway, such as the Great Western Main Line from Maidenhead to Swansea and the Midland Main Line from Sheffield to Bedford.

Other thresholds, such as the cost of projects not included in the spending envelope, including London’s Crossrail, have also been raised until they require board approval.

A senior rail executive said that he was “struggling to see why the board wouldn’t crawl all over anything worth more than £100m”, which he added would happen at any large, conservative company. “£750m does seem to be a big number – it’s pretty cavalier,” he added.

Manuel Cortes, general secretary of the Transport Salaried Staffs Association union, said: “Given the sums involved, the board should continue to sign off any project in excess of £150m.

“We are talking about taxpayers’ money here for a network which already has the highest fares in Europe.”

News of the plan was found in Network Rail’s board minutes. These said the board needed to “free-up” its time for other issues – Carne has emphasised an improvement in rail safety since he took charge in January. They added that “all matters” approved by the executive committee worth more than the existing £150m threshold would go to the board until May next year.

A Network Rail spokesman said that the change was merely “a slight tweak” and meant executive directors faced “more accountability” for the day-to-day running of the railways.