5th November 2012
- Transport secretary Patrick McLoughlin appeared before the transport select committee as a “damning” initial report into his department’s West Coast franchise process was released.
- Abellio declared an interest in the upcoming new Scottish rail franchises.
- Elaine Holt has stepped down from National Express.
Investigation into rail franchising
Heavy cuts to staff and budgets compounded by rushed policymaking have left the Department for Transport dysfunctional, according to the findings of a damning report into what went wrong in the West Coast rail tender. [Financial Times]
- The Department knew seven months ago that it did not have the correct methods to evaluate multi-billion pound bids for the franchise and that it risked a legal challenge. [Daily Telegraph]
In evidence to the Transport committee, the Transport Secretary defended the government’s attempt to get the highest price for the West Coast franchise but confirmed thousands of internal emails will be trawled for evidence that civil servants wanted to hand the keys “to anyone but Branson”. [The Independent]
- Sources have confirmed to the [Financial Times] that the bond required from FirstGroup to protect the taxpayer against failure was deliberately reduced.
There are fears the West Coast fallout could affect the Thameslink rolling stock contract, awarded to Siemens last year. [Financial Times]
Abellio became the first transport group to declare an interest in the new ScotRail and sleeper franchises. [The Herald]
London’s new orbital railway will be complete on 9 December 2012 when services begin between Highbury & Islington and Clapham Junction. [Rail Engineer]
Other rail news
Elaine Holt has stepped down from her role as bid director at National Express Group after just 10 months in the job. [Transport Briefing]
London Midland‘s driver shortage cancelled more services, despite an earlier pledge that the difficulties were over. [BBC News]
Finance update and sharecheck
FirstGroup shares soared in late July and early August as rumours began to circulate it had won the West Coast mainline franchise. They fell by more than a quarter after the process was subsequently cancelled in late September.
Passenger numbers were up but sales revenue down in the third quarter of 2012 for Eurostar, with the operator blaming a pre-Olympic slump. [Railnews]
Directly Operated Railways, the parent company of East Coast, has reported pre-tax profits of £7.1m on revenue of £665.m [RAIL]
Go-Ahead has said it wanted to make profits of £100 million a year from running bus services in Britain. [The Times]
National Express said it had traded well in its third quarter, driven by resilient performances from its UK bus and rail businesses. [Reuters]