Regulator fines Network Rail £2M for licence breach - updated

Network Rail has today been fined £2M by regulator the Office of Rail and Road (ORR) for failing to meet performance targets during 2014-2015.

An investigation by ORR in relation to Southern, Govia Thameslink (GTR) and in Scotland in 2014-15 concluded that Network Rail breached its licence and did not do everything reasonably practicable to deliver the reliability and punctuality needed to support train services. The latest report comes after the government announced changes to the funding structure of the organisation, which was criticised by the regulator in June for missing upgrade delivery targets.

"These serious issues have caused severe disruption and frustration for passengers, most notably affecting services at and around London Bridge. ORR is therefore imposing a £2m fine on Network Rail,"

Richard Price, chief executive, ORR

“Our investigation has identified important issues that Network Rail, working with operators, needs to address to improve performance for passengers on these routes. Our analysis shows that the company needs to develop a much better understanding of the impact of timetabling on the reliability of services and on rail users," said Richard Price, chief executive of ORR. “These serious issues have caused severe disruption and frustration for passengers, most notably affecting services at and around London Bridge. ORR is therefore imposing a £2m fine on Network Rail – a decision we did not take lightly. The scale of the delays suffered by passengers was central to our decision to fine. The penalty sends a clear message to the Network Rail Board; Network Rail must urgently rectify these errors and deliver the reliability of services that passengers have paid for.”

The ORR investigation showed that for Southern and GTR there were serious weaknesses in the data which informed the new timetables. For example a number of the timetable modelling assumptions made were incorrect as they were based on flawed data. It also found that 

Network Rail was overly optimistic in estimating and assessing the impact of the new timetable on performance. It significantly underestimated the impact of the Thameslink programme on performance, which was further exacerbated by a timetable that was not robust. 

These issues resulted in very severe disruptions and frustrations for passengers using London Bridge station. The company failed to engage adequately with the train operators to understand what impact the new timetables would have on their passengers and services.

Phil Hufton, managing director of network operations at Network Rail, said that the organisation was tackling the issues: “At the start of this year we had a number of problems that caused passengers disruption and frustration and we apologise for this.  Since then we have proactively invested over £11m to improve performance for Southern and Thameslink passengers.This investment, which has seen the introduction of a revised timetable, improved equipment, the deployment of rapid-response maintenance teams at London Bridge as well as new information screens and better passenger information, is paying dividends and passenger service reliability has now improved by almost 12% since January," he said.

“While the nuts and bolts of our infrastructure are the most reliable they’ve even been, severe congestion caused by record numbers of trains and passengers makes delivering a consistently reliable service a daily challenge for ourselves and the train operators. At London Bridge we are undertaking the biggest and most complex station and track redevelopment ever attempted on Britain’s railways – while simultaneously continuing to keep services running."

“As we are now a public sector organisation, the fine must come from within our existing budget and will mean a reallocation of existing resources to pay it.”

In Scotland, the ORR found that there were numerous errors in the December 2014 timetable caused by a number of factors including a lack of quality assurance and detailed planning. ORR’s findings therefore highlight the need for the company to adopt better planning and quality assurance processes before new timetables are implemented. While fewer passengers were disrupted in Scotland and performance has improved recently, this represented the third occasion in recent years in which timetabling issues have caused problems. With further timetable changes on the horizon to facilitate the redevelopment of Queens Street station in Glasgow, ORR will be closely monitoring the steps the company takes to ensure timetable changes are right this time.

ORR also conducted a separate safety investigation into the disruptions at London Bridge which found that while passenger information and pedestrian flow management could have been better, safety of passengers was not compromised.