MPs to probe rail route finances
TRANSPORT: An influential cross-party group of MPs is set to launch an inquiry into the latest financial breakdown to hit the country’s flagship East Coast rail route, saying there are “serious questions” to be asked.
AN INFLUENTIAL cross-party group of MPs is set to launch an inquiry into the latest financial breakdown to hit the country’s flagship East Coast rail route.
The Transport Select Committee says there are “serious questions” to be asked about the imminent collapse of the route’s multi-billion-pound franchise deal.
Transport Secretary Chris Grayling announced last week that the current Stagecoach-led franchise for the London-Yorkshire-Scotland line would not be able to continue for more than a few months due to losses. East Coast services were nationalised in 2009 following troubled spells in the hands of GNER and National Express. When the route was reprivatised in 2015, Virgin Trains East Coast – a partnership between Stagecoach and Sir Richard Branson’s Virgin Group – pledged to pay £3.3bn to run it until 2023.
The Government could now be forced to step in to operate trains on the line once again. Another option would see Stagecoach continuing to run services on a shortterm, not-for-profit basis.
Committee chair Lilian Greenwood, Labour MP for Nottingham South, said: “This failure – not once, but three times – has drawn criticism from all corners.
“There are serious questions to be asked of the train operator, Network Rail and Ministers and the Transport (Select) Committee intends to ask them. The failure of the East Coast franchise has wider implications for rail franchising and the competitiveness of the current system. Lessons need to be learned by all concerned.
“In the meantime, the Department for Transport must take the right steps to protect passengers and taxpayers. Safeguards must be put in place to restore public confidence in the sustainability of our railways.”
The Government has stressed that operations on the East Coast line will continue with “no impact on services or staff ”.
News of the select committee’s intervention came as Shadow Transport Secretary Andy McDonald told The Yorkshire Post that the failure of the East Coast deal showed the rail franchising system was “fundamentally broken”.
Speaking as he made his way by train to his Middlesbrough constituency after a visit to Leeds, the Labour MP said: “What it tells you is that this entire system is fundamentally broken, it is finished. This is not the first time that an East Coast (franchise) has collapsed – how much more do you need to know?
“We were told that when this franchise bid came along it was the highest-quality bid the Department for Transport had ever seen, so they were asleep at the wheel.”
Asked for Labour’s solution to the problems, Mr McDonald said: “We need public ownership. What we have got to do is have a single company that has overriding responsibility for track and trains nationwide.
“The whole purpose of the railways is that they don’t exist to provide opportunities for profiteering, they are there to serve our people, our communities, to let our economies grow and to connect our towns and cities.”