Examination of Witnesses (Questions 460
WEDNESDAY 31 OCTOBER 2001
460. There is an ongoing programme for railway
safety improvements, I hope this will take place following the
period of administration. Can the administrators tell me whether
there are (a) the resources and (b) the willingness to continue
with that as before? Is that going to come to an abrupt halt?
(Mr Rollings) No, not at all.
461. The resources are there?
(Mr Rollings) The resources are there. The funding
is in place. I think it was a point made earlier on, Steve Marshall
and two of his board colleagues are actually there to ensure the
safety case is met. We have had a review by the Health and Safety
Executive, initiated on administration, to confirm that the safety
case is valid within administration .Clearly there is every effort
made to ensure the safety of
462. Have you heard all improvements previously
scheduled will go ahead?
(Mr Rollings) Yes, I have no reason to believe why
463. Can I just ask how much private money is
going into any project and did go into any project that Railtrack
will be responsible for and will happen during the period of administration?
How much private money is going into it?
(Mr Bloom) I do not foresee the prospect of any private
money being raised during the administration period.
Mr Donohoe: It is all Government money.
Chairman: It is all taxpayers' cash.
464. How much private money has gone into earlier
projects that Railtrack had been involved
in up until the administration?
(Mr Marshall) If one looks backwards, up to the point
of administration, clearly the equity in Railtrack, which is no
more, which is why it is all now the taxpayers
465. Not a penny of private money?
(Mr Marshall) If you are defining private money as
the equity base of Railtrack that has absorbed obviously financial
overruns, then clearly it has absorbed very significant sums.
466. Mr Bloom, at the beginning you said that
you saw an opportunity that this presented. How do you see the
structure developing then?
(Mr Bloom) I think it is really too early to say.
We have been involved for three weeks. We had to spend a very
significant proportion of the first three weeks dealing with the
operational issues and the day to day issues that I described
earlier on. We are only really now starting to get going in looking
at the way in which this thing may be structured going forward.
I am really not in a position at the moment to give you developed
thoughts on that. We would be happy to come back at some future
Andrew Bennett: How soon?
467. If you have got this three to six months'
deadline that you have set yourself, you could perhaps give us
a note within that time?
(Mr Bloom) Yes, indeed.
468. May I ask you finally a very simple question.
Some time ago Railtrack informed its regional offices that it
intended to put more work with them and less at central Railtrack,
it then, less than a week before it went into liquidation, reversed
that and started to suggest that there were going to be a number
of dismissals in the regional offices. What are you doing about
(Mr Bloom) We have made a decision not to go ahead
for the time being with any redundancy programme. We made a decision,
together with the Railtrack board, not to implement a redundancy
programme of any type arising from the administration on the basis
that we wanted to keep confidence high.
469. Have you made that clear to your workforce?
(Mr Bloom) We have indeed.
470. You said again at the beginning that you
were happy to leave the day to day management with the existing
Railtrack management. Are you satisfied that some of the contractors
have not been ripping Railtrack off? One or two of the contractors
who seem to have taken over a lot of the maintenance seem to be
making some pretty good profits. Do you think they are justified?
(Mr Bloom) I am not really in a position to give you
our view on all the maintenance contracts, there are hundreds
and hundreds of maintenance contracts in position at the moment.
What we are doing, whilst I say that the day to day operational
management of the company rests with the board, we are in continuous
dialogue with them, and to the extent that there are contracts
which appear to be unfairly in favour of a contractor, clearly
those would need to be reviewed next time around in order to ensure
that there was a fairer balance in any future negotiations.
Andrew Bennett: Have Railtrack completed this
inventory of their resources and equipment?
471. And assets. Have they finished, Mr Marshall?
(Mr Marshall) If I may. On 1st October we provided
the Rail Regulator with a two year plan going forward.
472. Not a plan, Mr Marshall, remember you were
asked to do a register of your assets.
(Mr Marshall) You chopped me off in mid sentence,
473. Forgive me. A plan and a register of your
(Mr Marshall) Let me give you an actual. By the end
of this calendar year, our asset register, which is already in
place and is being populated with data, will be fully populated.
474. You mean it is not ready even though the
last time you came before this Committee you said it would be?
(Mr Marshall) I cannot recall exactly what I did say.
475. I think we know.
(Mr Marshall) I think it is well-known that at the
end of this year our asset register will be fully populated.
476. With guesses or accurate information?
(Mr Marshall) I must emphasis thoughand I have
been quite consistent on thiseverybody thinks the existence
of an asset register with data in it suddenly helps; it does not.
477. You do not think it helps to know what
you have at your disposal?
(Mr Marshall) We already know what is at our disposal.
478. How did you know that if you had not got
your register completed?
(Mr Marshall) Because we know what our assets our.
The issue is asset condition. For those who unfortunately are
picking up the risk for this business now I have to say whenever
people talk about water models and so on, it will be, whoever
is running the business, two to three years before there is the
predictability that comes from the knowledge of asset condition
that will inform forward spending plans.
479. So you know what your assets are, you have
not completed your register, but you do know the state of them,
and the only thing that would concern you for any subsequent company,
whatever form it was in, was that the people taking it over would
not know the shape of those assets?
(Mr Marshall) The assets we know, the condition of
them we know a lot about, but that has to be systematised in the
way other utilities have done.
(Mr Marshall) That will take two years to turn into
valuable, predictive information.
Chairman: I see. I think we can take it that
all the figures you have given us have been rather similar to
your estimates, they have drifted ever so slightly. Gentlemen,
you have been extremely informative. Thank you very much indeed.
We do wish you well.