The transport minister has said she will vote against £20m bonuses expected to be handed out to Network Rail's bosses, as Britain's trains are voted the worst value for money in Europe
Labour has claimed the government can do more to block bonuses for Network Rail chiefs, the day after Justine Greening pledged to vote against a six-figure bonus for the company's chief at their AGM.
The transport secretary insisted on Sunday that she would not be able to halt bonuses for Network Rail but would vote against giving the company's head executive, Sir David Higgins, a £340,000 payout, saying: "The governance structure that the last government set up means that I can go and vote against it.
The row over Network Rail bonuses comes as Britain's railways ranked bottom of a European league for fares, efficiency and comfort, according to a union-commissioned study on Monday.
The report by think-tank Just Economics said UK rail services were less affordable, less comfortable, slower, more inefficient and more expensive than in other European countries.
On Sunday, Greening said that her influence “won’t actually necessarily change the result” of the vote on Higgins’ payout.
“The other problem we’ve got is that the members can vote against the bonus package but at the end of the day their vote is only advisory," she said.
The secretary of state for transport has never attended an AGM for Network Rail before. But Labour claim documents show the government has to give "prior written agreement" for bonus packages to go through.
Shadow transport secretary Maria Eagle said: “Not only does the secretary of state have a place on Network Rail's remuneration committee but we now know that she must also give prior written agreement to any change to the incentive scheme for senior managers. The government must come clean on whether that written permission has been given as it is difficult to see why Network Rail would have felt able to propose this new bonus package without knowing it had Ministerial backing."
The company's directors could get bonuses worth 60% of their pay packages. Higgins, his finance director Patrick Butcher, director of asset management Peter Henderson, planning and development director Paul Plummer, operations director Robin Gisby, group finance director Patrick Butcher, and investment projects director Simon Kirby are in the frame for payouts.
The furore into the potential payouts is likely to be intensified by the report into Britain’s rail service in which the frequency of trains was the only area in which the UK outperformed France, Germany, Spain and Italy.
"In terms of bang for buck, not only does the UK come bottom of the index of outcomes but it also spends a relatively large amount of money to achieve this woeful result. This means that it also comes bottom of the value for money league," said the report.
"Our under-performing railways carry a considerable cost both for passengers and for the public purse. Our calculations show that a more affordable, more comfortable and faster railway would generate a staggering £324 billion in social value (£9.2 billion a year) between now and 2050. This is the equivalent of £7 of value per average journey in that period.
"We also estimate that the social, economic and environmental benefits of achieving a modal shift from road to rail - in terms of reduced congestion, accidents and emissions - could potentially reach £154.8 billion by 2050.
"When we combine this estimate with our previous figures showing improved outcomes for passengers, we calculate that the total social value of the strategic shift that we propose in this report is in the region of £479 billion."
The report was released ahead of the Government's response to the McNulty review on the future of the railways, which is expected to be published shortly.
Bob Crow, leader of the Rail Maritime and Transport union, which commissioned the study, said: "This latest research shows that the failures of privatisation are costing the UK hundreds of billions of pounds in social value.
"Instead of addressing that issue and looking at the cheaper and socially beneficial alternative of a publicly owned railway, McNulty proposes more cuts and even longer gold-plated franchises for the private train operators. Now McNulty and the train operators want to roll that model out across Europe, smashing up rail services from the North Sea to the Mediterranean."
Eilis Lawlor, the report's author, added: "Our research puts figures on what anyone who has been to France or Spain already knows - the UK's railways are poor value for money.
"Instead of profitability being the primary measure of success, the wider benefits of the railway need greater consideration.
"The Government should act decisively and make an objective and transparent assessment of the best way to organise Britain's railways so as to maximise social, environmental and economic value."
A Department for Transport spokesman said: "Unions are right to highlight the cost of railways and that also means looking objectively at Sir Roy McNulty's conclusions which set out how this needs to be done.
"We will shortly announce plans which will deliver a better value railway for the benefit of passengers, taxpayers and the wider economy. We hope unions will work with us on this."
Network Rail said that "no decision" had yet been made on bonuses.