ORR confirms penalty of £2.4m on Network Rail for poor planning and risk assessment

5 September 2007
ORR/25/07

The Office of Rail Regulation (ORR) has today confirmed its penalty of £2.4m on Network Rail for the weaknesses in the planning and execution of the Portsmouth resignalling scheme.

ORR announced on 30 July that it intended to impose a penalty of £2.4m for Network Rail’s breach of its network licence in failing adequately to evaluate and mitigate the risks associated with the Portsmouth resignalling project, and to manage its contractor in line with best practice. Network Rail made representations on the penalty, but ORR has concluded that it had already taken account of Network Rail’s arguments in arriving at its initial decision.

ORR Chief Executive, Bill Emery said: “A penalty of £2.4m is proportionate and reinforces the need for Network Rail to ensure that its planning, particularly its risk assessment, is fit for purpose and reflects the impact on passengers and train operators. I have written to Network Rail on the critical risk assessment issue.” 

Notes for editors

  1. The section 57C notice under the Railways Act 1993 (as amended) confirming the penalty is available http://www.rail-reg.gov.uk/upload/pdf/not-pmth-penalty-notice-060907.pdf  A copy of Bill Emery's letter to Iain Coucher is available http://www.rail-reg.gov.uk/upload/pdf/enf-pmth-penalty-060907.pdf.
  2. The penalty must be paid to the Department for Transport.
  3. Network Rail’s representations are available http://www.rail-reg.gov.uk/upload/pdf/enf-pmth-penalty-nr-reps-130807.pdf. There were no other representations.
  4. ORR announced that it had found Network Rail in breach of its licence on 6 June 2007 - http://www.rail-reg.gov.uk/server/show/conwebdoc.8741.
  5. Network Rail’s network licence is available on the ORR website at http://www.rail-reg.gov.uk/upload/pdf/netwrk_licence.pdf. The relevant licence condition is Condition 7 of Network Rail’s network licence which provides a duty for Network Rail to take such steps as are necessary or expedient so as to achieve the purpose of the Condition to the greatest extent reasonably practicable having regard to all relevant circumstances including the ability of Network Rail to finance its licensed activities.

    The purpose referred to above is:

    “to secure:
    1. the operation and maintenance of the network;
    2. the renewal and replacement of the network; and
    3. the improvement, enhancement and development of the network,

      in each case in accordance with best practice and in a timely, efficient and economical manner so as to satisfy the reasonable requirements of persons providing services relating to railways and funders in respect of:
      1. the quality and capability of the network; and
      2. the facilitation of railway service performance in respect of services for the carriage of passengers and goods by railway operating on the network.”
  6. ORR’s economic enforcement policy and penalties statement is available on the ORR website at http://www.rail-reg.gov.uk/upload/pdf/287a.pdf

Press enquiries

ORR Press Office – 020 7282 2188/2007