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Network Rail chiefs 'to block bonus scheme reform move'

Network Rail chiefs are to block a motion seeking reform of its top directors' bonus scheme, according to shareholders of the rail infrastructure company.
Some of NR's public members, who effectively double up as shareholders of the not-for-dividend company, wanted to question, at the company's annual meeting next month, the policy that has seen top NR executives getting bonuses of up to £270,000.

But although a motion calling for directors to take a voluntary 50 per cent cut in bonuses will be debated, a call for reform of the bonus system will not be allowed, said West Midlands councillor Phil Davis, chairman of the NR member steering group.

Mr Davis said: 'I am disappointed that a legal manoeuvre appears to have blocked the vote on a review of the directors' bonus scheme.'

It has been announced that, following the meeting of various performance targets, top NR directors would be getting bonuses of 55.6 per cent of their salaries.

This means chief executive John Armitt gets a £270,000 bonus on top of his £485,000 annual salary, with deputy chief executive Iain Coucher getting nearly £241,000.

Other NR staff will be getting a bonus of just £1,112 - or 4.95 per cent of their salary.

The bonuses came after Office of Rail Regulation chairman Chris Bolt expressed dissatisfaction with NR's progress towards giving train companies advanced warnings of engineering work.

Mr Davis said: 'Network Rail is largely funded by the taxpayer. It has made progress, but not enough as far as its customers are concerned. These bonus payments are unjustified when passengers still can't buy advance tickets at the required 12 weeks notice.

'The under-spend on investment also suggests these director bonuses have to be questioned - and the bonus scheme itself reviewed. The company has got to become more passenger-focused.''

The NR annual meeting is to he held in Birmingham on July 20.

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