A RAIL watchdog today warned Arriva Trains Northern it could be hit with further fines if conductors walk out over pay.

The Strategic Rail Authority (SRA) has also hinted that any prolonged strike action could play a part in influencing its future franchise decisions.

As revealed in yesterday's Evening Press, conductors are expected to vote unanimously in favour of a strike next week after pay talks broke down.

Bosses at the National Union of Rail, Maritime and Transport Workers (RMT) have organised the ballot, the results of which will be known on Tuesday.

They claim conductors have not been offered the same pay rise as drivers. Last year, Arriva was charged around £13 million in penalties by the SRA for poor performance including disrupted services and driver shortages.

An SRA spokeswoman said the rail regulator would not shirk from imposing further financial penalties if performance targets dipped as a result of any industrial action. But most worryingly for Arriva, she also refused to rule out the possibility that prolonged strike action could affect Arriva bids to keep its rail franchises.

The company is currently bidding for its TransPennine Express franchise, and its regional services under the new Northern franchise.

"Arriva has informed us about this threat (of strikes). We will consider further enforcement action if performance falls below targets," the spokeswoman said.

Alan Health, York regional organiser at the RMT, said: "Arriva is aware of these possibilities. We don't want to put the company in any difficulties. But you can't pay extra to one group and then not to the others."

Updated: 11:27 Saturday, January 05, 2002