Rail gamblers lose £980m of YOUR cash

RISInG costs and missed targets meant that ministers broke yet another election promise when they shelved plans to spend £38 billion upgrading the country’s rail network.

a damning report last week by the Commons public accounts committee warned that taxpayers will have to foot the bill for ‘staggering and unacceptable’ cost increases. network Rail was accused of ‘losing its grip on costs’.

The modernisation plan — a centrepiece of the Tory manifesto in May — included two major electrification schemes in the north and the Midlands, which were halted in June and then later reinstated with delayed completion dates.

Patrick McLoughlin, the Transport Secretary, said that spending plans would be amended after ‘running out of control’.

Yet it’s not the only part of the state-owned network Rail’s spending that seems to have gone awry.

Research by the clever and forensic Tory MP John Redwood has revealed that network Rail, the owner of Britain’s track and stations, has incurred huge losses trading in the money markets.

The losses have been made in the so-called derivatives markets, where network Rail takes risks by investing in foreign currencies.

‘The year to March 2012 saw £409 million of losses in derivatives . . . and a further £45 million of such losses in the year to March 2013,’ says Redwood.

‘I wrote a letter to the members of network Rail, the group responsible in those days for the corporate governance and strategy of the business on behalf of the taxpayers who pay the bills. I asked them to explain their derivative strategy and why they thought it was a good thing to be doing. My own view was it should be stopped.

‘network Rail continued with derivatives, and reported losses of £982 million on them in 2013-14.’

Why is a body that’s supposed to improve our rail services operating like a casino chancer in the financial markets — and, worse still, losing large sums of money in the process?

I asked network Rail why they were gambling with public money, but they did not reply. I wonder why?