First profit for Network Rail

Network Rail has made a profit for the first time in the firm's history.

The firm, which is responsible for railway tracks and signals in the UK, announced a £747 million profit for the six months up to September.

The not-for-profit company, which replaced Railtrack in 2002, had also cut costs by £1 billion and had received, delayed payments from the government.

The profits will be spent on improving the rail network.

In May, Network Rail had announced a pre-tax loss of £232 million for 2005-06, which it said was due to paying interest on money that it borrowed in order to fix the railway system.

Network Rail chairman Ian McAllister said that train safety and punctuality had improved.

Train punctuality is currently at its highest level for seven years, reaching almost 90%.

Mr McAllister said that passenger numbers had increased by 40% over the last decade and he said that the priorities now were to ease overcrowding on trains, as well as increase train punctuality above 90%.

Commenting on Network Rail's announcement, Liberal Democrat transport spokesperson Alistair Carmichael said: "These figures are welcome news and show that Network Rail is beginning to reduce costs, as it was set up to do. As Network Rail receives £4 billion of taxpayers' money each year, it is only right that every penny is reinvested back into maintenance and improvements.

"However, the current structure of the industry is creating a money merry-go-round. Spending on our railways must be much more transparent, and the industry should be simplified further.

"Current investment in our existing network is only a short-term solution to the capacity problems that will arise in the next decade. If we are to offer a viable alternative to flights within the UK we are going to have to start planning to meet extra demand by putting forward proposals for new high speed lines."

(KMcA/EF)