Rail industry welcomes the appointment of Sir Peter Hendy as chairman of Network Rail, hoping firm will ‘rediscover the art of the rail operator’

 

hendy_railSir Peter Hendy is known for successfully leading improvements to both underground and heavy rail operations in London

 

The Department for Transport has moved to remedy longstanding weaknesses on Network Rail’s board, appointing Sir Peter Hendy, currently London’s transport commissioner, as non-executive chairman and former Eurostar chairman Richard Brown as the government’s special director.

The public membership governance structure has also been abolished to strengthen the company’s accountability to the DfT, following its reclassification as a public sector business last year.

Transport secretary Patrick McLoughlin said the new arrangements were predominantly to address the spiralling cost and poor planning of the company’s electrification programme. However, industry executives said the changes would go far deeper.

In particular, the expectation is that Hendy will refocus Network Rail on remedying declining punctuality and ensuring no repeat of the chaos caused by overrunning engineering works during Christmas and the New Year.

The appointments of Hendy and Brown were universally welcomed in the industry. First Great Western managing director Mark Hopwood said he hoped that under Hendy’s chairmanship Network Rail would “rediscover the art of the rail operator”.

Off-the-record comments from other industry executives were more frank. “This is the first time in a long time they have had someone [Hendy] at that level in the business who actually understands what they should be trying to do, not going up a learning curve from ground zero,” a senior industry source told Passenger Transport. “It’s a complex business in a complex sector and I don’t think it has been served well by the recent crop of chairmen and chief executives.”

Train operators have long expressed concern about the lack of board-level railway operational experience, particularly at chief executive and chairman level where Mark Carne and the departing chairman Richard Parry-Jones were both recruited from outside the rail industry, as were their predecessors. Non-executive Chris Gibb is the only current board member with direct operational experience.

By contrast, Hendy is known for successfully leading improvements to both underground and heavy rail operations in the capital, after spending the majority of his career in the bus industry, while Brown is a career railwayman known for his development of British Rail’s Midland Main Line and Cross Country businesses and his leadership of Eurostar. Another senior train operator commented: “This is all about understanding what the railway needs to work properly, giving passengers the confidence they need and then thinking ahead. I think they [Hendy and Brown] will be able to provide more firepower round the board table on that … if you accept Network Rail is falling short in a number of areas, that’s where it needs focusing.”

There is also an expectation among some industry executives that Hendy’s operational perspective, his role as a four days per week hands-on chairman, compared to the two days per week Parry-Jones, and his status as a direct DfT appointment could create clashes with the priorities Carne has been pursuing.

“I think it will be Hendy for sure [who is in charge],” Passenger Transport was told. “Certainly it will be a different experience for Carne than Parry-Jones.

“I think Hendy will ditch a lot of rhetoric around the digital railway and concentrate on the basics, I hope he tries to create a proper relationship with Network Rail’s customers [train operators], and I really hope he reverses the centralisation that going on, taking responsibility away from the routes and pushing it back to the middle.”

On his appointment, Hendy said: “I am delighted to be asked to chair the board and help the executive team and the whole organisation fulfil Network Rail’s full potential. I am looking forward to working with Mark Carne as he takes the organisation forward.”

 

Related coverage in the latest issue of Passenger Transport:

 

‘His fingerprints will be all over the business’
Keith Ludeman, a former Network Rail director, believes his long standing industry colleague Sir Peter Hendy can help get the company back on track

Electrification ‘paused’ as NR reins in ambition
Transport secretary Patrick McLoughlin halts Midland Main Line and Transpennine electrication and prioritises Great Western programme

The man who changed London
Just hours after his departure to Network Rail was announced, Sir Peter Hendy reflected on nine years in charge at TfL – and the important lessons learnt

 

This article appears inside the latest issue of Passenger Transport.

DON’T MISS OUT – GET YOUR COPY! – click here to subscribe!