Examination of Witnesses (Questions 200-215)
DFT, ATOC, NETWORK
RAIL, ORR AND
SRA
12 OCTOBER 2005
Q200 Mr Davidson: Why did you not
draw that to the attention of the National Audit Office at the
time in order that a change could be made?
Mr Muir: As it happens I have
been doing a parallel exercise on BTP in the last three or four
weeks and it was only during that exercise that I did this sum.
Q201 Mr Davidson: So you prepared
for this hearing but you did not prepare for the discussions with
the National Audit Office, which is fair enough, I suppose? Can
I just clarify the 37% increase in assaults on staff? Is that
just a statistical anomaly? That is certainly not part of reports
I have had from railway staff.
Mr Muir: No, there is no reason
why that particular change, the National Crime Recording Standard,
should have changed that particular category of crime.
Q202 Mr Davidson: So you accept that
a 37% increase in assaults on staff is a reasonable figure? Can
you explain to me why you think that happened and to what extent
it was because of cuts in operating expenses made by the train
operating companies in an attempt to boost profits?
Mr Muir: I do not know whether
assaults on staff have or have not gone up. I do know that any
assaults on staff are very serious, that there are too many assaults
on staff and we want to get them down.
Q203 Mr Davidson: Yes, yes. Without
the waffle though the figure says it went up by 37%. You have
had the opportunity to see this and to correct it if you thought
it was wrong, so I presume you accepted it. What I was seeking
clarification from you on was the explanation as to why you believe
that during this period assaults on staff went up by such a substantial
figure.
Mr Muir: Assaults on staff are
serious. I merely repeat, and I apologise if I did not make it
clearer when this was being done, that I do not know whether assaults
on staff have gone up or not by 37%. I do know that they are serious
at any level.
Q204 Mr Davidson: Would I be right
in thinking that you are not taking this all that seriously then
as an issue?
Mr Muir: I am taking it exceptionally
seriously.
Q205 Mr Davidson: Why in that case
are you unable to tell me whether or not this 37% increase in
assaults on staff is genuine or a statistical blip?
Mr Muir: Because certainly in
the last three years, and also before then, there has been a very
heavy focus by train operators on assaults on staff. We have been
positively encouraging reporting of assaults on staff. We have
been introducing the new DNA swabs so that if people are spat
at we are able to use a DNA swab to aid identification of the
culprit.
Q206 Mr Davidson: So what is the
latest figure?
Mr Muir: I do not know to what
extent the increase is real or increased reporting of things that
were not previously reported.
Q207 Mr Davidson: But you ought to
check that surely? You are in a senior position. Surely you ought
to have checked that at some stage? If this important matter was
coming across the desk of almost any of us here we would have
investigated whether or not the statistics were comparable, and
I am astonished to find that you are telling me that you do not
know.
Mr Muir: It is impossible to tell
how much was unreported in 2001-02. I have to repeat that this
is an exceptionally serious issue and it is one reason why the
reporting numbers have gone up. It is because train operators
have taken it so seriously in the last few years.
Q208 Mr Williams: All the questions
on the Report have been covered but I was moved by the cynicism
of my colleague, Mr Davidson, in his questioning. I think he has
failed to take on board the real nirvana that was announced two
days ago by Network Rail. I am not allowed to ask him questions,
so I cannot ask him whether he knew about it but I will come to
Mr Armitt. Mr Armitt, you told our Chairman that this press notice
that we have was issued not exactly unconscious of the fact that
you were attending this meeting today. Is that not a very generous
interpretation of what you said?
Mr Armitt: In fact, I believe
we sent Members a copy.
Q209 Mr Williams: You certainly wanted
us to read the figures you put forward and I have been reading
them. I wonder if you realise, Chairman, that this new regime
that has just been announced by Mr Armitt suggests an incredible
amount of neglect in the past with the need for up to £4
billion of investment in stations. That is interesting. You see,
there are 2,000 stations. That means on average about £2
million a station. That does not make sense, does it? That is
not going to happen.
Mr Armitt: No, it is not.
Q210 Mr Williams: Let us look at
that £4 billion that you have floated before this Committee
as a piece of evidence that you believe we should read. Much of
that is going to come, of course, from you taking on a property
developer's role, and I do not object to that happening. What
I object to is the attempt to misrepresent to this Committee what
exactly this means to our constituents. The fact in your press
release is, of course, that most of this £4 billion will
go in retail developments and will go in offices and will go in
residential development, will it not? Is that not the fact?
Mr Armitt: No.
Q211 Mr Williams: It is bound to
be.
Mr Armitt: We did an estimate
of the money which we believe needs to be invested over the next
10 to 15 years in, in the first place, the larger stations across
the network. If you just take the 50 largest stations we calculated
that about £2.2 billion was needed to go into those stations.
We then looked at the broad generality of the next group of larger
stations to see what was the level of investment needed to provide
the increase in capacity to meet the expected demand in these
stations. Take Birmingham New Street. The plans for Birmingham
New Street at the moment are of the order, depending almost on
which day of the week it is, of anything from £200 million
to £700 million which needs to be invested in and around
Birmingham New Street station to turn that into a much more user-friendly
station for passengers. We, together with various agencies in
the Midlands, are working with others at the moment to see how
that can best be effected, how you get that money into the station
through developers, who will obviously benefit through offices
and housing and retail opportunities built around the station,
and the money which then goes into the station fabric itself.
Q212 Mr Williams: I do not doubt
that the stations are going to benefit as a result of what is
happening. I am not challenging that but I am challenging whether
they are going to develop to the extent that they will benefit
to the extent you have tried to convince this committee in the
press release you submitted to us. The £4 billon is in fact,
as I understand it, going into investment in private sector involvement
in partnership and so on in enhancement of the environment. We
are told that Euston has a comparable area to Canary Wharf. All
I am getting at here is that this document you have submitted
actually was intended to lead this committee to expect far more
going into the stations than there is the remotest prospect of
them ever seeing.
Mr Armitt: Can I explain? The
statement was not written for the Committee. The press release
was written to bring out primarily to property developers and
other people interested in the opportunities which exist in the
railways the scale of opportunity which we see exists and to which
we wish to attract developers. As far as the Committee was concerned
we thought it was important because part of the Report recommends
that this sort of thing should happen. The point we were wanting
to make was that we are aware of it, we have been thinking about
it for several months and it is not something which is a shot
out of the dark. We have been planning this. We simply wanted
to make the Committee aware that we have got plans to do it, we
intend to do it and we think it is very important.
Q213 Mr Williams: No-one has anyone
has any problem with that. We want you to develop the sites as
effectively as you can for the benefit of the network. The important
point is that this does savour a little bit of spin just before
you were coming here. We are told that stations are the shop window
of the railway and next in line for investment and modernisation.
We are waiting for modernisation such as electrification. We are
waiting for new rolling stock, some of which is coming on stream
and we are seeing that now. We are going to wait for a long time
for the state-of-the-art safety systems to be installed along
the network. If you are going to make £4 billion, good for
you. If you are going to make that sort of money out of the property
development I have no problem with that. All I am saying is that
I do not like this Committee being misled into thinking that a
major part of that is going into what would be a relatively small
part of that, being the station development, and much of it will
go into the other work which in many ways is a higher priority.
That is my only cautionary point.
Mr Armitt: I apologise if you
in any way feel that we have misled you. Our intention, as I say,
was to demonstrate that we were doing things to bring money into
that part of the railway network which certainly, because of other
priorities, has not received as much funding as people would have
liked over the last few years. The stations are the shop window.
The stations are the shop window in two directions: they are the
shop window to the railway and they are equally the shop window
for the town itself, which is why at the moment a lot of work
is going on at stations up and down the country where local authorities
and PTEs are helping by providing funds for their local station
to improve the appearance of the station for people arriving and
departing in their town. A lot of money has gone into stations,
however, in the last few years. Look at Manchester Piccadilly
where £260 million investment went into that and has transformed
it. We spent £260 million at Leeds station improving that.
A lot has been going on but with 2,500 stations there are bound
to be a large number which still need a lot doing and the idea
of the clusters, which was the earlier question, was that in getting
business to witness opportunity around the larger stations we
can actually get some funds put to one side for those stations
which otherwise would not receive funds.
Mr Williams: As I say, this Committee
and the National Audit Office are always looking for the best
possible utilisation of public assets but I have to bring Mr Davidson
back down to earth, and despite the £4 billion there will
not be gold under the rooms of the station.
Mr Davidson: But they will be open.
Q214 Chairman: Mr Armitt, this is
a value for money Committee. In 2004-05, on top of a basic salary
of £480,000, you received bonuses of £270,000, pension
payments made by Network Rail of over £144,000 and other
payments of £25,000, making £919,000. Is the travelling
public getting value for money from you?
Mr Armitt: I would hope the travelling
public feel that they are getting value for money from Network
Rail. As a director of Network Rail what I am paid is decided
by the Remuneration Committee and they take into account what
directors of the company could expect to receive in similar scale
companies elsewhere in business at large and they are very conscious
of that responsibility and are keen to ensure that we do not get
paid above the median in that respect. The bonuses were a result
of the meeting of a whole series of targets which had been set
and those targets are made tougher every year. We fundamentally
wish to provide a better service as directors of Network Rail
and the company seeks to pay us what they think is the right market
rate for achieving that.
Q215 Chairman: Have you personally
made a difference?
Mr Armitt: I hope I have made
a difference. That is for others to decide.
Chairman: Thank you very much, gentlemen.
I am sorry it has been a long hearing but a very interesting one.
We are very grateful.
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