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Article: No financial woe, says Metro chief

Started by ozbob, May 19, 2010, 04:09:18 AM

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ozbob

From the Melbourne Age click here!

No financial woe, says Metro chief

QuoteNo financial woe, says Metro chief
CLAY LUCAS
May 19, 2010

SPECULATION that Metro has threatened to walk away from its $8 billion contract with the Brumby government is incorrect, the boss of the train operator has said in an extraordinary letter to his 3600 staff.

Metro chief executive Andrew Lezala told staff, in a letter posted to each of them, that widespread reports the operator is going broke just six months into its contract were wrong.

Among rumours and reports that Mr Lezala said were incorrect were that the state government was paying all wages, that Metro had asked to be released from its eight-year contract, and that it planned mass redundancies. ''We are making money and will not make mass redundancies,'' Mr Lezala wrote.

He said his company had not threatened to walk out on its contract with the government. ''We have an initial eight-year contract that we intend to deliver,'' he wrote.

Since taking over from Connex in December, Metro has failed to meet punctuality targets.

So far this month, Metro is again failing to meet performance targets, running 85.38 per cent of trains on time.

Under its contract, it must run 88 per cent within five minutes of scheduled time or face penalties.

Mr Lezala recently conceded it could take up to a year to see any real improvement in Melbourne's train system.

''We plan to blow targets away in 2011,'' Mr Lezala wrote in the letter to employees.

Leaked minutes from a Metro management meeting obtained by The Age last month showed the operator desperately trying to cut costs by rescheduling projects, deferring payments and considering retrenchments.

Mr Lezala has previously denied this was proof Metro was in financial trouble.
Half baked projects, have long term consequences ...
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ozbob

From the Herald Sun click here!

Metro denies rumours it is pulling out as the city's rail provider

QuoteMetro denies rumours it is pulling out as the city's rail provider

    * Wayne Flower
    * From: Herald Sun
    * May 19, 2010 9:15AM

UPDATE 11.50am: TRANSPORT Minister Martin Pakula has blamed "mischievous" rumour-moungers on reports that train operator Metro plans to break its eight-year contract.

Metro drafted a letter to reassure staff and passengers it has no intention of pulling out as Melbourne's rail provider before its eight-year contract is up.

"I am not surprised they felt the need to send a letter out given that the rumour was started by people with mischievous intent some seven or 10 days ago," Mr Pakula said.

He said the rumour was completely without foundation and he that he supported Metro in its contract.

In an extraordinary letter to employees, mailed to their homes, Metro chief executive Andrew Lezala told staff that reports the operator was going broke just six months into its contract were wrong.

Metro spokesman Chris Whitefield told the Herald Sun this morning the letter explained to employees that contrary to reports in a rival publication the company was not running out of money.

"It talks about the money that we are spending,'' he said.

Mr Whitefield said the rumours originated when the company asked to move some projects forward.

"For example one project that was listed for our fourth year of franchise we said we needed it done in year one, so we moved that project and that subsequent money forward to do that,'' he said.

"The money still gets spent on the project, it's just more gets spent in year one as opposed to year four. The (rumours) say we're looking to move money forward to pay wages, which is just ridiculous.''

Mr Whitefield said the company was positioned well to see out its contract, offering a new incentive scheme for employees rewarding them as they reach certain performance levels for on-time performance during peak periods.

"We're hiring a couple of hundred new staff, we're spending twice as much on infrastructure and maintenance and renewals, so the money is there and the money is there to be spent on important projects,'' he said.

"It's not there to bail wages out or whatever it is that's going around.''

Mr Whitefield said the purpose of the letter was to quell those rumours.

"People are talking about us running out of money, so that's not good for staff and it's not good for the passenger and customer morale,'' he said.

"There is only so many times we can say 'no' about this ... The point of the letter is to say the recent media rumours are untrue, here is what is actually happening.''
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