Slaughters at centre of political storm over Railtrack legal fees

The Liberal Democrats are up in arms because Slaughter and May and other advisers who worked on the administration of Railtrack will not disclose their fees, thought to have run into £700,000 a week since last October

Liberal Democrat shadow transport minister Tom Brake is writing to Railtrack administrator and Ernst & Young partner Alan Bloom to demand that the fees are disclosed to the public.
He is also calling on Bloom to explain how Slaughters was selected as the main legal adviser on the administration, which ended last week, and whether the appointment represented best value for money. Brake told The Lawyer: “I would wager a tenner that 99 per cent of MPs don't know how Slaughters was chosen for the Railtrack job. I know the firm is incredibly expensive. I think that from a value-for-money point of view, the tax payer needs to know about the process of selection.”
There is no evidence of any beauty parade or tendering process having taken place.
Slaughters' lead partner for Railtrack Jonathan Rushworth said: “We were asked to advise and said that we would be very happy to work with Ernst & Young.”
Railway administrations are unlike normal company administrations because the 1993 Railways Act does not require administrators to disclose their fees to creditors. The Railtrack administration is the first time the 1993 act has been used.
Brake said that the £700,000 a week fee is the closest estimate he has arrived at through his own research.
Insiders think the earliest that administrators will eventually file their costs with the court is the end of this year and Rushworth said a date had not been set.
An Ernst & Young spokes-person said there were no immediate plans to disclose the Railtrack fees.