The final insult after soaring rail fares? Now you’ll pick up the bill for bailing out Branson!

BOASTFUL billionaire that he is, Sir Richard Branson posted pictures of himself enjoying the expensive delights of the Swiss ski resort of Verbier last week.

Here was the bearded showman with his family under a towering Christmas tree. And here he was flat on his back in deep snow and designer goggles with one languid ski in the air. What fun it must have been to relax up in the mountains, where he just happens to own a luxurious chalet complete with indoor swimming pool.

But if you’d mentioned such indulgence to the thousands of rail passengers shivering on platforms up and down Britain yesterday, you might have heard the blunt suggestion that Branson should take a very long ski off a very short mountain.

Mistake

Those travellers, of course, returned to work after the Christmas break to face average rail fare increases of 3.4 per cent, while long- distance passengers will see ticket price rises of up to 10 per cent.

The soaring cost of rail travel means that passengers in this country spend twice as much of their income on rail travel as in Spain, and four times more than in France where the train network is heavily subsidised.

So what’s that got to do with Richard Branson? This week he’s been dragged into an ugly row between Lord Adonis — who resigned on Friday as head of the National Infrastructure Commission — and the Tory Government.

Adonis is furious with Transport Secretary Chris Grayling over a decision he took recently on the future of the East Coast Line, which Richard Branson and Virgin Trains took over three years ago, together with its Scottishbased partner Stagecoach.

Then, Branson crowed that he would drag the service into the 21st-century with investment in a fleet of 65 new ‘Super Express’ trains by 2018, refurbishment of the existing rolling stock, station and parking upgrades, and a 50 per cent increase in capacity with a further 12,000 seats.

Yet the reality has been that Virgin and Stagecoach — founded by Scot Sir Brian Souter — have turned the eight- year franchise they secured into a breathtaking failure that could cost taxpayers hundreds of millions.

Lord Adonis is especially exercised by the fact that in November, Chris Grayling quietly let Branson and Souter off the hook after they admitted they’d got their sums wrong when they pledged to pay £3.3 billion to control the service until 2023.

Instead of forcing them to carry on running the lossmaking railway, he proposed a new partnership between track and train operators that would take responsibility for the East Coast route in 2020.

Although the minister denied that he was bailing out Stagecoach, the company’s share price rose by 15 per cent after the plan was published.

So it was that Virgin Trains and Stagecoach were freed in one bound, with no apparent penalties, from Branson’s over- hyped, extravagant promises to dramatically transform travel on the London to Edinburgh route.

Grayling’s decision came soon after Stagecoach — which had taken on responsibility for 90 per cent of the cost of the East Coast franchise — owned up to the stock market that it had made a dreadful mistake.

The company admitted it had to write off a £130 million investment in the franchise, a figure which included £84 million of losses over the next two years on the East Coast operation. The company blamed Network Rail’s failure to provide better track, and the late arrival of next-generation trains, for the shortfall.

Adonis said of Grayling: ‘If, as seems certain, he lets Virgin Trains East Coast tear up its promise to pay the public purse £2 billion for the last three years of the contract, every private rail franchise in Britain will demand the same and the entire rail franchise system will collapse.’

It should not be forgotten, of course, that Adonis’s resignation last week was fuelled by virulently anti-Brexit sentiment, with this former Blair acolyte seeking to undermine the Tory Government. But in the process he has shone a startling light on how the inept Transport Secretary, a railway buff, has mishandled the issue.

Grayling’s decision to relieve Virgin and Stagecoach from their obligations was partly obscured by his upbeat pledge to reopen some of the railway lines axed at the time of Sir Richard Beeching’s cuts in 1963.

Amid the nostalgic enthusiasm, the transfer of the East Coast line to a new East Coast Partnership, under which train operators and railway network operator Network Rail would work the franchise together, did not receive great public scrutiny.

Now, it has become a hot political potato, and as far as Britain’s railway chiefs and the Government are concerned, the timing of the row could not have been worse.

Fiasco

A Mail investigation on Monday revealed that some executives at the big train operating firms, including publicly quoted Stagecoach, stand to collect as much as £5.4 million in earnings in the current financial year. How that must enrage the millions who saw fares go up again this week, after a year plagued by engineering works, poor service and the worst strike disruption in decades.

The fat-cat salaries and luxury lifestyles of rail bosses — like the high living of Richard Branson — are in stark contrast to the incomes of ordinary households, which are being squeezed by inflation just as fares are rising sharply. That’s why the howls of rage from Labour politicians about the East Coast Line will play well with voters, who may also conclude — not necessarily rightly — that this is a Government more interested in keeping big investors sweet rather than fighting the corner of hard-pressed commuters.

Yes, Chris Grayling’s failure to take on Branson and Souter over their broken promises to transform the East Coast line looks cowardly and clumsy. But the real danger is this fiasco will increase the misguided calls — echoed by Lord Adonis last week — for rail lines to be re-nationalised.

If railways are run efficiently by private companies, they should bring suitable rewards to their executives and investors, while also providing a good service at reasonable prices. But when bosses abuse the franchises, the reputation of capitalism is tarnished.

Truth

That’s why there must now be an investigation, either in Parliament or via the National Audit Office, into the whole fiasco, so taxpayers can discover the truth.

As for Richard Branson, unlike his partner Stagecoach, he has not had to reveal the extent of his failure on the East Coast Line because Virgin Trains is not a quoted stock market company, and is therefore not obliged to make the same public disclosures when things go wrong. We may eventually see the impact when financial returns are lodged at Companies House.

Indeed, in classic Branson style, he has shrugged off this massive setback, and in the week before Christmas was back at what he does best — self-promotion.

He was very keen to talk about his struggling futuristic enterprise called Virgin Hyperloop One, which he claims will let people travel between Scotland and the South-East of England in 45 minutes. His message was that it had landed £37 million of outside investment.

But surely most long-suffering rail passengers would agree that if he’d spent less time on space-age projects and more on making the East Coast Line a thriving concern, we would all be better off.