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Rail franchising process plans to be announced

Today the government will announce plans to re-open the rail franchising process, six months after the collapse of the West Coast Mainline deal.

It is thought that the priority will be to agree a new ownership deal for the East Coast mainline.

Read: Has Britain's rail system gone off the rails?

A new ownership deal for the East Coast mainline could be a priority Credit: Martin Keene/PA Wire

The rail route will be put back into private ownership after a long period under state control.

The decision is expected to reignite the rivalry between Virgin Trains and FirstGroup, who competed for the west coast franchise last year.

Read: Virgin Trains continue to run West Coast Mainline

Department for Transport needs to be 'reorganised'

MP Louise Ellman told ITV Daybreak that the Department for Transport needs to be reorganised, with more commercial expertise involved, when dealing with specific franchise bids.

MP Louise Ellman is calling for more commercial expertise involved, when dealing with specific franchise bids Credit: John Stillwell/PA Archive

In October the Government U-turned on the decision to award FirstGroup the West Coast Mainline, after finding "significant technical flaws" in the way the procurement was conducted.

Virgin are now running the service until November 2014, with the fiasco costing the taxpayer £43 million.

Read: West Coast shambles to take another three years to sort.**

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Rail franchise deal revealed 'substantial problems'

This episode revealed substantial problems of governance, assurance, policy and resources inside the Department for Transport.

Embarking on an ambitious, perhaps unachievable, reform of franchising, in haste, on the UK's most complex piece of railway was an irresponsible decision for which ministers were ultimately responsible. This was compounded by major failures by civil servants, some of whom misled ministers.

Many of the problems with the franchise competition, detailed in the Laidlaw report, reflect very badly on civil servants at the DfT. However, ministers approved a complex, perhaps unworkable, franchising policy at the same time as overseeing major cuts to the Department's resources. This was a recipe for failure which the DfT must learn from urgently.

– Chair of the Transport Committee Louise Ellman

Ministers 'lied to' over west coast rail deal

In its report on the west coast mainline fiasco, the Transport Committee has said embarking on the reform of franchising on the UK's most complex piece of railway was "irresponsible" and needed greater senior executive involvement and more technical expertise.

"A more direct description of what happened is that ministers and senior officials were lied to about how the outcome of the franchise competition had been reached." said the MPs' report.

"We cannot categorically rule out the possibility that officials manipulated the outcome of the competition not only to keep First Group in the running for as long as possible, as Mr Laidlaw suggested, but to ensure that First got the contract."

DfT branded 'irresponsible' over west coast rail fiasco

A Government department was today slammed for being "irresponsible" over its role in the collapse of the £5 billion West Coast Mainline rail contract.

A committee of MPs said the Transport Department had embarked on an "ambitious, perhaps unachievable" reform in haste, and claimed that ministers and senior officials were lied to.

Virgin has now been told it can run the west coast mainline service until November 2014. Credit: Press Association

FirstGroup was told it had won its bid to take over the franchise from Virgin Trains, but the decision was scrapped after the discovery of "significant technical flaws" in the way the procurement was conducted.

Virgin has now been told it can run the service until November 2014, with the fiasco costing taxpayers over £40 million.

The mistakes came to light after bidder Virgin Trains, which had run the West Coast Mainline since 1997, launched a legal challenge against the decision.

A Government-commissioned report led by businessman Sam Laidlaw last month gave a damning indictment of how the competition was handled.

Three members of staff at the DfT were suspended over the episode.

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Transport Sec 'taking swift action' over West Coast Main Line

The government's transport secretary has said that his department is taking "swift action" regarding the controversy surrounding the West Coast rail franchise.

Transport Secretary Patrick McLoughlin said:

"The NAO has made a number of recommendations that mirror many of the findings of the Laidlaw Inquiry in terms of the work we need to do to strengthen our organisation and the structures within it.

"We are already taking swift action on this front and I believe the plans we are putting in place to ensure future franchise competitions are conducted on the basis of sound planning, the rigorous identification and oversight of risk, will prevent a repeat of these lamentable failures."

Labour MP: West Coast franchise is 'a fiasco'

Labour MP for Barking, Margaret Hodge
Labour MP for Barking, Margaret Hodge Credit: Dominic Lipinski/PA Wire/Press Association Images

The House of Commons Public Accounts chairman has called the government's handling of the West Coast franchise a "fiasco."

Margaret Hodge, Labour MP for Barking, said: "The DfT's handling of the West Coast franchise was a first-class fiasco."

"It has left the Government's entire policy on rail franchising in disarray, as a further three competitions have had to be put on hold.

"The total cost to the taxpayer of putting it right is currently unknown but is likely to be significant."

Ms Hodge said the Dft had "blundered into this major and complex competition for one of the biggest franchises in the country without even knowing how key parts of its policy were to be implemented".

West Coast rail franchise 'sign of serious problems'

The head of a report that stated that taxpayers were likely to incur a significant bill over the West Coast rail franchise has said that there are "serious problems."

National Audit Office (NAO) head, Amyas Morse, said: "Cancelling a major rail franchise competition at such a late stage is a clear sign of serious problems.

"The result is likely to be a significant cost to the taxpayer."

Taxpayers will face 'significant' bill over West Coast rail

A FirstGroup service passing a Virgin Pendolino train in Glasgow Central Station
A FirstGroup service passing a Virgin Pendolino train in Glasgow Central Station Credit: Martin Keene/PA Wire/Press Association Images

Taxpayers will face a "significant" bill over the West Coast rail franchise process, a report from a Government spending watchdog has said.

The Department for Transport's (DfT) running of the West Coast bidding process lacked management oversight, with some staff "confused" by the system, the National Audit Office (NAO) report said.

The Government has already indicated that repaying bidding costs to the companies competing for the franchise is likely to land taxpayers with a bill of around £40 million.

In its report, the NAO said staff and adviser costs, legal costs and money for the two reviews set up by the Government following abandonment of the West Coast bidding amounted to £8.9 million.

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