Part 4: Demonstrating that plans and procedures are followed

4.1
In this Part, we describe:

• the importance of demonstrating that plans and procedures for day-to-day work are followed;
• our expectations; and
• Ontrack's systems for demonstrating that plans and procedures for day-to-day work are followed.

The importance of demonstrating that plans and procedures for day-to-day work are followed

4.2
Systems for demonstrating that plans and procedures are followed are an important means of informing an organisation about the progress it is making, and providing assurance.

4.3
Reviewing progress against plans provides feedback about whether work will be done within expected timeframes and budgets. It may provide an early warning of problems or the particular outcomes that can be expected. This information can be useful for further planning. It provides performance information for management decisions, and can be used to identify areas for improvement.

4.4
Demonstrating that procedures are followed may provide assurance that there is legal compliance, critical steps have occurred, or that particular considerations have been taken into account when performing tasks. It may also confirm whether a task has been completed or not.

4.5
Ontrack has code documents that set out technical standards and specifications for the rail network. The code documents are part of Ontrack's safety system. It is important for Ontrack to have assurance that it has followed the technical standards and specifications in code documents.

Our expectations

4.6
To set our expectations, we described the review and assurance mechanisms that we expected an established infrastructure manager to have in place to measure and review progress against operational plans and to show that procedures are followed. We set out our expectations in Appendix 2.

4.7
In Part 3, we discussed the operational plans and procedures Ontrack had for managing day-to-day maintenance and renewal work on the rail network. We expected that Ontrack could demonstrate that the work in operational plans was carried out, and that procedures had been followed.

Demonstrating that work in operational plans was carried out

4.8
In paragraphs 3.6-3.10, we noted that Ontrack had various operational plans for maintenance and renewal activities. Ontrack reviewed progress against these plans in several different ways.

4.9
Ontrack had detailed internal reporting and analysis of progress against its planned track renewals work. This provided clear information about actual progress against operational plan targets for various track renewal tasks, including trend information. This enabled Ontrack to more accurately predict whether it would achieve all the track renewals work within its operational plans, and whether it would do so within the planned budget.

4.10
Ontrack recorded whether particular types of tasks had been completed within timeframes that were specified in code documents. It did this differently for different types of tasks. Several of the reports we reviewed showed work overdue for completion. Some track maintenance and signals, telecommunications, and electric traction tasks were significantly overdue.

4.11
It was difficult to tell what progress Ontrack was making against planned maintenance and renewal activities where there was work overdue for completion. This was partly because work that was not completed within the required timeframe could create further work. For example, if work on a structure was not completed within a specified timeframe then a further inspection had to be performed to check that the structure was still suitable for use. Delaying work could also result in an asset's condition worsening, with more work required to fix it.

4.12
Ontrack looked at trend information to determine whether it was reducing the amount of outstanding work for some of its work activities. The information was reported differently for different activities. In many instances, the information helped staff in Area Offices to see whether they were showing an improvement in completing particular types of tasks.

Ontrack's overview of progress against planned work

4.13
Although Ontrack had various reports about progress or performance for particular planned work activities, it did not have a clear picture of the overall progress it was making against planned work activities. There were several reasons for this:

• The short-term and flexible nature of Ontrack's operational plans made it difficult to get an overview of the work Ontrack intended to do in the first place.
• Further work could be created if planned work was not completed within a specified timeframe.
• Ontrack had not documented the relative size and scope of the different types of planned maintenance and renewal activities (see paragraph 5.61). This made it difficult to tell whether the extent of overdue work for particular activities was of concern.

4.14
Our review of Ontrack's progress reporting showed that, for some activities, Ontrack was not keeping up with planned work, which in turn could create further work. However, because Ontrack did not have an overview of planned work, or progress it was making against planned work overall, we could not determine whether Ontrack was close to keeping up with planned work or whether the amount of overdue work was increasing over time. If Ontrack held this information, it could use it to optimise resource allocation or to determine whether it needed further resources.

4.15
We discuss the need for Ontrack to align information between corporate and operational plans, and the reporting associated with the plans, in paragraph 5.37.

Demonstrating that procedures were followed

Code documents

4.16
We noted in paragraphs 3.33-3.35 that Ontrack had code documents setting work standards and specifications for work on each asset group. The code documents formed part of Ontrack's safety system.

4.17
Ontrack had various controls in place to check that the work standards within the code documents were complied with. The controls included inspections, audits, and mechanical testing. Ontrack had reports associated with some of the controls.

Track assets and signals, telecommunications, and electric traction assets

4.18
We identified a number of problems with Ontrack's controls and associated reports for track assets and signals, telecommunications, and electric traction assets.

4.19
Code compliance reports for track assets and signals, telecommunications, and electric traction assets were prepared by OIL staff, and required the signatures of the Area Manager and the Regional Manager before being forwarded to Ontrack's Head Office.

4.20
It was unclear what these reports provided assurance about, or what accountabilities the Area Manager and Regional Manager had in signing them. The wording in the report sign-off areas was ambiguous, and the purpose of the reports was not stated.

4.21
One track compliance report we saw was missing a considerable amount of information. It noted that a number of outstanding actions to comply with code documents - the earliest from 2002 - had not been addressed because further staff resources were required. Despite the outstanding information and actions, it had been signed by both the Area Manager and Regional Manager. This raised questions about whether staff understood their accountabilities for code compliance reporting, and how seriously they took them.

4.22
The compliance reports for track assets and signals, telecommunications, and electric traction assets were prepared quarterly. Staff noted that the track compliance report took some time to prepare because they needed to compile detailed information within the reports from a number of systems.

4.23
In our view, Ontrack needs to review its code compliance reporting requirements so the purpose and accountabilities for the reports are clear and well understood. Ontrack has done a small amount of work to address aspects of this.

Structure assets

4.24
The controls for checking that structures work complied with code documents relied on the Structures Inspector for each area checking the condition of structure assets, either to detect whether work needed to be done or to check whether work had been done to the required standard. The Structures Inspectors had guidance material to help with their inspection and could consult with Head Office engineering staff. However, Ontrack did not have formal controls to check or provide assurance about the quality of work carried out by the Structures Inspectors.

4.25
Ontrack told us that its Structures Inspectors are competent and experienced in assessing the condition of materials used for the construction and repair of structure assets. However, the consequences of a Structures Inspector making a poor judgement call or failing to detect a problem in the integrity of a structure asset could be significant. In our view, Ontrack needs to be very confident about the controls it has in place.

Templates for following processes

4.26
We noted in paragraphs 3.27-3.31 that, in 2007, Ontrack mapped the processes for carrying out work described in its operational plans.

4.27
Ontrack had prepared standardised information templates for some points in the processes it had mapped. The templates should help staff carry out their tasks and check that work has complied with Ontrack's process requirements. The templates were introduced shortly before our audit work started, and it was too early to determine whether Ontrack was using them.

4.28
In paragraph 3.31, we described how some parts of processes were not documented or were unclear. We noted that Ontrack needs to complete its process mapping so it is always clear how work should be done, who is responsible for doing it, and what information is required for it. It was not clear whether Ontrack intended to do further work to document the processes fully, or to put mechanisms in place to check that processes were followed.

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