£23.5m penalty issued to L&SER by Government

The Government has issued a £23.5 million penalty to London & South Eastern Railway following the serious breach of its franchise agreement – which saw it stripped of the Southeastern franchise (Railways Illustrated, December 2021) and an Operator of Last Resort put in place to take over services previously operated by L&SER.

The announcement came after work conducted by the Department for Transport identified that L&SER had deliberately concealed more than £25 million of historic taxpayer funding relating to High Speed One between October 2014 and March 2020. It was also found that similar practices had been carried out by the company during its previous franchise agreement between April 2006 and October 2014.

LSER had operated the Southeastern franchise since 2006 between London, Kent, and parts of East Sussex. Operated by Govia, the franchise was a joint venture between Go-ahead and Keolis.

Transport Secretary Grant Shapps said: “I took decisive action and did not renew the contract with Southeastern following this appalling breach of trust. Our rapid and firm action protected taxpayers and passengers – ensuring much-needed services continued to run.

“LSER’S behaviour was simply unacceptable and this penalty sends a clear message that the Government and taxpayers will not stand for it.” SE Trains Limited assumed responsibility for the franchise with effect from October 17.

The new operator is a wholly-owned subsidiary of DFT OLR Holdings Limited, the public sector-owning group also being responsible for LNER and Northern Trains Limited.

Andrew Bannister RIGHT: Locomotive Services Class 37s D6817 (37521) leads the chairman’s train across the causeway at the western end of Loch Eilt, near Lochailort on the West Highland extension line, with D6851 Flopsie (37667) on the rear. This was a private charter from Alnmouth to Arisaig and the return working was 1Z81, the 11.03 Arisaig to Alnmouth, seen here on March 7.