23 January 2010

Compensation culture

Said RAIL's managing editor Nigel Harris recently:

"If an American airline had stranded a Eurostar load of passengers (a couple of '747s' - say 700 people) for more than 3 hours on US soil [contrasting against Eurostar's five sub-Channel failures on 18 December] then each and every passenger could be entitled to $27,500. That's £16,916 per passenger... or £19.25 million per train. For the five failed Eurostars that could have meant compensation payments of just short of £100m - ten times what Eurostar has actually paid out."

LEYTR Comment: The rules 'across the Pond' were introduced by the Obama administration before Christmas and aim to force US airlines to treat all their passengers fairly. The European Union plans to introduce similar compensation legislation within her member states and would encompass most modes of passenger transport - buses, coaches and trains. While the latter offers more in the way of financial recompense than buses and coaches, delays and failed last workings could see the operator pay for overnight accommodation; loss of life - even when this can be later determined in a court of law to be misadventure on the part of the deceased - would still require an immediate cash payment running into thousands of pounds.

One LEYTR operator told us last year that, if introduced, his insurance company would refuse to insure his business; no doubt other, small bus and coach companies face the same plight. It is completely unworkable in a rigid framework. We understand the British government opposes the legislation but may not opt to veto its introduction.

This legislation is in early consultation stage and hopefully common sense will prevail - if only for Eurostar's sake: £100m rather than £10m could have had serious consequences on the company's continued operation!

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