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Railways: Compensation

Answer

Schedule 8 payments from Network Rail to the train operators are applicable for cancellations of timetabled services due to bad weather if the decision

to cancel is made after 2200 the day before; if the cancellation of timetabled services is agreed before 2200 the day before, then the timetable for the day as changed, and therefore schedule 8 payments do not apply.

Compensation in the later case is dealt with elsewhere in the Track Access Agreement, under the schedule 4 compensation regime. Details of the compensation regimes in the Track Access Agreements are published by the Office of Rail Regulation.

In general, the payments made by Network Rail to train operators under their Track Access Agreements, and those made by the operator to passengers for delays, serve different purposes and therefore are not comparable.

Compensation paid to train operators for delays for which Network Rail is responsible (including those arising from external events such as cable theft) is a matter for Network Rail. The compensation regime is a contractual and commercially confidential element within the Track Access Agreement between Network Rail and each operator, and is overseen by the Office for Rail Regulation.

Compensation is set on a formula basis designed, on average, to compensate the train operator for the future loss of revenue arising from disruption, including any longer-term loss of revenue from a sustained period of poor performance. It is not related to and does not include provision for any additional costs incurred by train operators, such as compensation costs to passengers.

Compensation paid by train operators to passengers for delays is based on an entirely different system, in line with the terms of the operator's Passenger's Charter, and may vary for example with the type of ticket purchased. A number of existing franchises operate, as will all future ones, the Delay/Repay compensation system, under which compensation for delay is paid regardless of whether the delay was attributed to Network Rail or a train operator.

The Minister responsible for rail meets regularly with senior representatives of Network Rail and other industry parties to discuss current rail performance. Passenger Focus is the official, independent consumer organisation representing the interests of rail users nationally. As such, Ministers would not normally expect to discuss matters concerning performance payments with them.

Secondary information

Type

Written question

Reference

181973; 573 cc125-6W

Session

2013-14

Subjects

Compensation Franchises Railways Network Rail Weather

Contains statistics

Yes

Link

View this Written question on www.publications.parliament.uk