Railtrack row over doubled pay

A NEW row over Railtrack is threatened as it was revealed that the replacement executive board members will be paid more than double the salaries and bonuses of their predecessors.

The salary of the new chief executive could top £1m a year under proposals now being drawn up. The basic salary of £500,000 would more than double by the time the performance-related bonus scheme, pension and fringe benefits are taken into account. The former chief executive, Steve Marshall, earned £341,000 last year including pension entitlement.

Ian Coucher, head of the Tube Lines consortium chosen by Government to take over a large section of the Tube, is among those tipped for the job.

Transport Secretary Stephen Byers, already under fire for forcing Railtrack into administration as the company announced an increase in its half-yearly profits, now faces a further backlash.

A report today says that other senior salaries also increase under proposals being drawn up by recruitment consultant Heidrick & Struggles and WestLB, the German bank bidding to work with Government for the replacement Railtrack body.

Under the plans, Railtrack's finance director would be paid a total of nearly £500,000 while other directors would receive in the region of £300,000 per annum. The bonus payments to directors would be triggered if financial, safety and performance targets are met.

Ernst & Young the Railtrack administrator will earn at least £12m from the assignment. The company's weekly fees are estimated at around £500,000 and the administration is expected to last anything from six to 12 months.

Alan Bloom, the chief administrator, told members of the Commons Transport Committee that he charges his own time at £450 an hour. Other members of his team generally charge around £250 per hour.