The boss of Go-Ahead, which owns Southern rail operator Govia, waived his bonus as the company reported profits of nearly £100m, despite widespread problems at Britain’s biggest commuter franchise.
David Brown, Go-Ahead’s chief executive, apologised to passengers after a summer of travel misery. The group said he would forgo his annual bonus and had declined a pay rise. Brown’s pay packet amounted to nearly £2.2m last year. The company has also introduced passenger satisfaction measures in its annual bonus plan.
Passengers have suffered months of travel chaos amid disputes with unions and staff shortages. Southern introduced an emergency timetable in July and blamed “unprecedented” levels of staff sickness, but will restore more than a third of the 341 daily services cut next Monday.
However, the unions were angered by the profits. RMT said Go-Ahead was a “money-raking disaster that has turned Britain’s railways into a global laughing stock and they should be slung out and replaced by the public sector option”.
The travel group’s statutory profits before tax increased 27% to £99.8m in the year to 2 July, with revenues up 4.5% to £3.4bn.
The results come a day after the government unveiled a £20m fund and a new review board to improve Southern rail services and restore confidence in the franchise, which is run by Govia Thameslink Railway (GTR). Govia is a joint venture between Go-Ahead, which owns 65%, and France’s Keolis, which owns 35%.
David Brown said: “A large part of the role of the GTR franchise is to introduce three new train fleets and modernise working practices. During this period of change, Southern services have been disrupted by restricted network capacity, strike action and increased levels of absence.
“We apologise to the people whose lives have been affected during this time. We continue to work closely with the Department for Transport, Network Rail and other suppliers and partners to operate the best service possible while delivering the long term improvements.”
There will be more disruption if a 48-hour walkout by guards goes ahead on Wednesday and Thursday as planned, while a strike by RMT station staff over the station modernisation programme has been called off.
Govia has been at loggerheads with unions over the use of more driver-only trains and the role of guards.
Shadow transport minister Andy McDonald called on the government to seize back the franchise from Govia. “Over the past year Southern has established itself as the standard bearer for dysfunctional privatised rail services. Passengers are enduring the worst delays in the country, fares are up 25%, and public investment to improve Southern services seems a long way off''.
RMT general secretary Mick Cash said: “Just a fraction of these profits would be enough to keep the guards on Southern trains, keep the passengers safe and resolve the industrial dispute between RMT and the company. It is shameful that they have opted to hoard cash instead of protecting the travelling public.”
“This profit announcement comes just a day after the government propped up Southern with yet another £20m of taxpayers cash. The company could clearly fund improvements themselves if they weren’t wholly dedicated to trousering fare-payers money in shed loads.”
GTR is lossmaking, but this was offset by strong performance at Southeastern and London Midland. Go-Ahead’s rail division’s contribution to the Department for Transport was £222m last year.
Brown said the £6.5bn Thameslink programme, which comes after 40% passenger growth on Southern over the past five years, would deliver “gradual improvements” over the next two years.
Southern is the UK’s largest rail franchise, covering routes from Sussex, Surrey, Hampshire and Kent into London, and runs Gatwick Express services. GTR operates the Thameslink and Great Northern rail companies. Its parent company Govia runs the London Midland and South Eastern train companies and has been shortlisted for the West Midlands franchise.
Go-Ahead’s bus division had a record year. It is the biggest bus operator in London with a quarter of the market. It spent £85m on 300 new buses and new depots.
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