PracticeConsultingRailtrack FD challenges Byers

Railtrack FD challenges Byers

Railtrack finance director David Harding has accused secretary of state Stephen Byers of giving an incomplete picture of the beleaguered company's funding.

In a letter to the Financial Times today, Harding said Byers’ letter, published on Tuesday, ‘does not, I believe, give the complete picture of the government’s funding of Railtrack

He continued: ‘While Railtrack plc received Pounds 336m on Monday October 1 as deferred grant, the Strategic Rail Authority did not go forward with the funding structure for the revenue grant also due on that day.

‘This would have given Railtrack plc immediate access to a further £445m and an equivalent amount over the remainder of this financial year.’

He added that officials had confirmed this funding structure was ‘still on the table’ on October 3 and that the SRA had agreed to implement it, and that it was an essential part of their funding.

‘The SRA and the Department for Transport, local government and the regions were clear that Railtrack’s only remedy for breach was an interim review by the regulator, hardly possible at 5pm on Friday faced with a court hearing on Sunday,’ Harding concluded.

Byers’letter to the FT said allegations that the rail infrastructure company’s insolvency was a result of the government’s going back on its promise of £700m in aid were incorrect.

According to the secretary of state, the government had brought forward the payment of a grant for £1.5bn in April to be paid in stages. ‘The first payment was due on October 1 and it was paid in full.’

‘Our legal obligations to Railtrack have been met,’ he added. ‘No promises have been broken.’

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