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Train Companies Get Away With Millions In Delay Payouts

30 April 2012

Train companies are pocketing tens of millions of pounds for delays while leaving passengers empty handed, a leading rail union revealed today.

They were paid £184 million by Network Rail last year for disruption caused by the taxpayer funded infrastructure firm which maintains lines, signalling and stations(*).

But only a tiny fraction of that cash was ever passed on to frustrated passengers who suffered late and cancelled trains, said the TSSA.

Figures obtained from the Department for Transport revealed that only five of the 23 train operators told Ministers how much they gave back to passengers in 2011-and on average that amounted to only £650,000 per company.

If that figure applied across all 23 passengers firms, it would mean less than £15 million was paid out to passengers in 2011(**).

"The original train robbers got 30 years for stealing £3 million," said union general secretary Manuel Cortes.

"But each year these private firms are effectively pocketing 20 or 30 times that amount which they should pass on to long suffering passengers but don't.

"Network Rail and the private companies are operating a cash merry-go-round in which the passenger gets taken for a ride.

"It is a scandal that compensation which should go to the travelling public ends up in dividends for the likes of multi-millionaires like Sir Richard Branson and Sir Brian Souter."

The general secretary is writing to Justine Greening calling on her to force the private train companies to publish each year how much they receive in compensation for delays outside their control and just how much they then pay out to passengers.

"There is at least a £100 million credibility gap here that the train companies must explain to passengers," he added.

"They get compensation when their trains are more than five minutes late but the poor old passenger does not receive a full refund until his or her train is two hours late and then has to jump through countless hoops to get it.

"When you add to that the fact that 45% of passengers say they never claim compensation, you can see this is a rigged system whereby the passenger gets mugged at every turn.

"The taxpayer forked out nearly £5 billion to support this industry last year and yet neither Network Rail or ATOC will tell us how much each company gets in compensation and how much it pays out."


*The total compensation paid by NR in 2011 to 23 train operating companies and five freight companies.

** The five companies which revealed passenger compensation to the DfT were:
Crosscountry, £1,319,000; East Midlands Trains, £220,000; London Midland, £309,000; East Coast, £883,000 and Southern, £525,000.

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