FD on alert as debt-ridden Network Rail reviews brief

Network Rail is reviewing its financial comms support as it struggles to cope with £17bn of debt.

Financial Dynamics has held the account for the past four years and will repitch against a maximum of five other agencies.

'We need specialist help with debt issuance,' said Network Rail head of external communications Chris Rumfitt. '£17bn of debt is likely to rise to £21bn over the next three years and that will create obvious PR problems.'

The brief, believed to be worth around £80,000, also involves general strategic comms advice for the troubled owner of Britain's rail infrastructure.

Network Rail emerged after Railtrack went into administration in 2001. The Government was subsequently accused by shareholders of engineering the collapse of Railtrack, which was privatised in 1996.

Network Rail's financial troubles are rarely out of public view. This month the Office of Rail Regulation proposed a £250,000 fine
after the company gave out incorrect information about the capability of the network.

And following last month's reclassification of Channel Tunnel builder London & Continental Railways as a public sector firm, there are calls for Network Rail to be similarly reclassified. If such a reclassification occurred, the Government would assume Network Rail's debt – posing a threat to Gordon Brown's 'golden rule' of not borrowing more than 40 per cent of GDP.

Despite the debt, Network Rail is pushing ahead with rail developments, including a proposed £1bn revamp of London's Waterloo station.

The Network Rail comms team is currently 28-strong. It said that it expects to appoint a financial comms agency by June.

Have you registered with us yet?

Register now to enjoy more articles and free email bulletins

Already registered?
Sign in