Rail firm hints at more job cuts

National Express says it needs to save money in the current climate

A company running a major UK rail route says more job losses are possible.

National Express, which operates the London to Scotland East Coast Main Line, has already announced that 750 jobs are to go.

Chief Executive Richard Bowker said "It is certainly possible that some of the plans will result in further headcount reductions."

For the year 2008, National Express Group made a pre-tax profit of £194.1m - up 9.7% on 2007.

Mr Bowker added that National Express, which also runs the East Anglia and the London to Southend c2c franchises, would honour its franchise commitment in terms of services provided.

But he said the company was "looking at" services which were over and above levels which it was contractually obliged to provide.

"We have to look at all areas of cost," Mr Bowker said.

National Express has to pay the government premiums of £1.4bn over the life of its East Coast franchise, which ends in March 2015.

'Cutting own throats'

Mr Bowker said today that this, and other companies' contracts, had been drawn up in very different economic times and that the rail industry was facing "challenging conditions".

He went on: "Constructive discussions are ongoing with government on a wide range of issues relating to the outlook for UK rail."

There has been speculation that National Express and other rail companies now want to renegotiate their franchise agreements in the light of the recession.

Mr Bowker described the 2008 financial results as "fantastic" and said he was confident that the company's rail division would be profitable in 2009.

Gerry Doherty, leader of the TSSA rail union, said: "National Express's cost-cutting plans will be self defeating and end in disaster.

"By axing jobs, closing dining cars, cutting ticket offices and rationing first-class passengers' biscuits and water, they will only drive passengers away.

"This will lead to the very thing they are so anxious to avoid - the inability to pay (the) Government the £1.4bn premium for the East Coast line. They are cutting their own throats."