Select Committee on Environment, Transport and Regional Affairs Minutes of Evidence


Examination of Witnesses (Questions 20 - 39)

WEDNESDAY 1 NOVEMBER 2000

MR GERALD CORBETT, MR RICHARD MIDDLETON AND MR CHRIS LEAH

  20. Why did it take your Board over six hours to decide whether or not to accept your resignation; was it a serious attempt to resign?
  (Mr Corbett) Yes, of course it was.

  21. I do not think there is any "of course" about it, Mr Corbett. How are we to be convinced that you were not just making a gesture because of another accident?
  (Mr Corbett) No, I think that is not right. After the call from China we sat up in bed and thought about what we would do next. I was pretty clear that that was that, and I did not think I would get any support and that people would say "Goodbye and good luck." But I did it, and then during the day messages of support came in, which did surprise me, and those messages were conveyed to the Board by the appropriate parties. And part of the Board meeting was about the causes of the crash and what we had actually done, and then the other part was about my own position. And they concluded that I should stay, partly, I think, because of my record, although in the public service it is never as good as it should be, we have been able to double investment over the last three years, we have been able to improve the quality of the track, we have been able to reduce the number of broken rails, we have been able to improve train performance, and I have made a start at improving the culture of the company, and I think they took that into account.

  22. And that debate took them six hours?
  (Mr Corbett) Perhaps you can ask my colleagues, who were involved in the debate.
  (Mr Middleton) As Mr Corbett has said, the Board meeting did not just consider Mr Corbett's position, the Board spent much of the first several hours of the meeting considering the accident and our response to the accident, what we needed to do to reassure public safety; and that was at the forefront of the Board's agenda. We turned to the issue of Mr Corbett's resignation somewhat later in the evening.

  23. And how long did that take then, Mr Middleton?
  (Mr Middleton) I cannot remember the exact timings; part of the meeting was disrupted because we had to contact one of the non-executive directors in America, and trying to set up these conference calls always takes time. But I would say, over the course, the meeting started at 5 o'clock and finished at 11, probably about three to four hours on the first part of the agenda, an hour and a half on the second part.

  24. I see. I did ask, did you intend to resign once all the immediate crisis had ended, Mr Corbett?
  (Mr Corbett) I tendered my resignation and the Board have asked me to stay on, because, in their view, and given the support that I then received, they considered I was the best man to lead the company through this difficult period. This is bigger than me and it is bigger than the company, and it is actually bigger than the industry. And this is not about me trying to cling on to office, or anything like that, I will stay as long as it is deemed appropriate for me to stay, and when the time is right for me to go I will go.

  25. Do you believe there was a failure in the chain of command between Railtrack and Balfour Beatty, and that led to the Hatfield accident?
  (Mr Corbett) It is too early to tell. It is either incompetence or a system failure, or it might be something to do with, there might be a cultural aspect to it. But these are big issues. What we can say is that, following Hatfield, we have inspected 1,800 other sites that have got these tiny little cracks, you can see on the top of that rail, and outside of the contract area we have not found any rail in that condition. And that does lead us to suppose that it is more likely that this was a sort of local incident and a local failure than a national failure. But, of course, we have got to look at all the management processes, we have got to look at the whole way we work with the contractors. We have moved forward from the old style contracts, as you know, and we are in the process of putting in the new contract; this contract was one of the old ones. We have obviously got to reassess, in the light of what happened at Hatfield, the new contract, we have got to rethink that, but we are still at quite early stages in that process.

Dr Ladyman

  26. While we are on the subject of your Board meeting and your resignation, I would like just to touch on the governance of Railtrack. You have only been on the Board of Railtrack since 1997, but others have been on it since privatisation. And I just wonder if you would like to comment as to whether you think you have the right Board, whether they are able to advise the exec. directors, that the non-execs are able to advise the executive directors appropriately, whether you think you have the right mix of experience on the Board?
  (Mr Corbett) I think we do. Our Chairman has 40 years in the construction industry, as a contractor, we have the Chief Executive of the Prudential Corporation, which is one of the biggest companies in the country, we have a main board director of Rio Tinto Zinc, who have huge projects around the world, we have the former Chief Executive of a major water utility, we have a property expert.

  27. Can I just interrupt you there. By one of these strange coincidences that this Committee comes across every so often, the only two members of your Board who have any experience of the railway industry are sitting alongside you at this moment. Do you not think that there should be some more people on the Board from the railway industry that might have first-hand knowledge of these safety issues?
  (Mr Corbett) These two have 60 years' experience between them. The level further down, my direct reports, are zone directors, six of the seven have all had more than three years' experience in the railway, a number of them have 20, 30 years. Of the top 100 people in the company, we did an analysis a couple of months ago and it is 41 from the outside and 59 from the railway. And there is a very delicate balancing act between preserving the old railway skills and knowledge with the introduction of, let us call it, new blood, because we do face a massively complex task and we face some huge challenges, in terms of major projects, in terms of coping with growth, in terms of raising money, all those kinds of things, that actually does require some different skills from the old railway skills.

  28. But did not that balancing of new blood and experience take place too quickly? With hindsight, looking at the history of the Board since privatisation, were not railwaymen not put on the Board in the first place, and I say railwaymen meaning railwaymen and railwaywomen, were they either not put on the Board in the first place or were they not taken off the Board very rapidly?
  (Mr Corbett) We have not taken any experienced railwaymen off the Board.

  29. Because they were not put on there in the first place?
  (Mr Corbett) No; the only executive directors that have come off the Board are the previous Finance Director, Professor Mellitt, who, although he knew a lot about engineering, had only been on the railway for four years, and David Moss, who was a civil servant. I am intrigued by your line of questioning, because people have actually criticised me for going too slowly rather than too fast.

  30. The Safety Committee, for example, has two non-execs on it, from my research anyway; one's experience is the Port of London Authority and various banks, and the other is the Severn Trent organisation you were talking about earlier. Now surely there should be a Board member with railway experience on your Safety Committee?
  (Mr Corbett) On the Safety Committee there is Chris and there is Rod Muttram, who is Managing Director of Rail Safety, the new company, and then that Board is advised by the railway skills that sit in their team.

  31. But Mr Muttram has an electrical engineering background, not a railway background?
  (Mr Corbett) Mr Muttram has been on the railway now for six years and has appeared many times before this Committee, and in my view is widely respected throughout the industry for his knowledge of safety issues.

  32. But you do not have a non-exec. with a railway background?
  (Mr Corbett) We do not have a non-exec. with a railway background, that is true.

  33. And do you not think that perhaps that is an omission that should be addressed?
  (Mr Corbett) I personally do not think that is an omission that needs to be addressed. I think that the perspective that the non-executives bring does not necessarily require detailed knowledge of the railway. Every other big company I have worked for, the non-executives have not come from that industry. In fact, often, if they do come from the industry you do not get the breadth of thinking and you get issues with vested interests. So it is not quite as simple as that. In an ideal world, it would be wonderful to have the Chairman of SNCF on the Board; but we have not got him. It is actually not that easy to get people prepared to commit the time to Railtrack.

Chairman

  34. They are not exactly underpaid, Mr Corbett, are they; they are not donating their time? How big is your Board, how many directors do you have and how many people have railway experience? It is not a difficult question.
  (Mr Corbett) The Board is 13, I believe.

Dr Ladyman

  35. Two have railway experience.
  (Mr Corbett) Well I have been in the railway three years.

  36. You did not come from a railway background.
  (Mr Corbett) No, I did not come from a railway background.

Chairman

  37. You came from a property background, Mr Corbett, which is why I think you were so appreciated.
  (Mr Corbett) I did not come from a property background, Madam Chair. I have had a variety of different experience in my life; my previous company was called Grand Metropolitan, which is a big food and drinks company.

Miss McIntosh

  38. Can I just remind the Committee of my interest in Railtrack, which has been declared at previous meetings. Could I just establish, at the outset, Mr Corbett, that you said that, the incidence of SPADs and broken rails, am I right in saying that it was down 30 per cent at the first six months of this year?
  (Mr Corbett) Yes. We provided a briefing pack to the Select Committee, and you can see from page 13 that the number of SPADs has reduced significantly in the first seven months of this year, it is down 30 per cent. Last year, and you can see from page 12 the historical trend, last year actually was the lowest number of `signals passed at danger' ever, and year to date it is 30 per cent down. You can also see from page 10 that broken rails in the first seven periods of the year are down 32 per cent on last year; and you can see from page 9 the historic trend. They did go up in 1998-99, they came down last year by 4 per cent, and year to date they are down by 32 per cent.

  39. Thank you. You did actually write to us with those figures on 2 October, which was very helpful. You did refer in your introductory remarks to the fact that heavier trains are passing on the track. I have a particular concern that Eurostar carriages are being used on this line, that was exposed by the Hatfield disaster, and I understand that carriages are put through safety tests. Can you just reassure the Committee what the level of those tests were before they entered the service; because if you look at every other part of Europe, including the so-called fast lane between London and Kent, where these carriages have been in use, they do have dedicated track?
  (Mr Leah) There is no doubt that in Europe there is very often separation of high-speed trains and other trains, such as freight, and in the UK we are pretty unique in running high-speed trains and heavy freight on the same lines. However, the Eurostars, those particular sets, did go through a very rigorous safety acceptance process, with which both I and Richard were involved, in clearing, electrically and physically, the route from Kings Cross up to York. Those trains, however, came into service for GNER, if I remember correctly, in May this year on this timetable; so they were not in service prior to that period, apart from test-running. In that respect, I do not know whether they play a part in this at all, but it will certainly be part of the examination which our experts from in house, from universities and from Deutsche Bahn, Germany, will be looking at.


 
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