Great Western Coffee Shop

So what impact will the shambles over the West Coast re-franchising have on the Great Western franchise bids. I cannot believe the shambles.

Very simple really, and mind boggling that DafT got it wrong. It's reputed that civil servants at DafT have hated Virgin ever since they were forced to renegotiate the first franchise in Virgin's favour (Virgin had them over a barrel after the downgrading of the WC modernisation). So I do wonder whether it was less cock up and more conspiracy.

Rail franchise row 'threatens Great Western improvements'

The West Coast Main Line rail franchise row could mean a two-year delay to any train improvements in the south west of England, a passenger group has said.

A decision to award the line to FirstGroup was scrapped because of "technical flaws" in the bidding process, which are being investigated. Bidding for all British franchises is on hold while a review is carried out.

Questions are now being asked about knock-on effects to Great Western area, Travelwatch Southwest said.

Professor Jon Shaw, of the University of Plymouth, said the region was "dependent upon the new franchisee making the improvements". He said: "We're not going to have line electrification or new trains for a long time yet. It was smaller changes that franchisee was expected to deliver which we're gong to see the delay on."

Chris Irwin, from Travelwatch Southwest, said he was expecting about two years of delays, which was "very worrying". He said: "We're going to see a lot of projects not being delivered, such as new rolling stock, the new Paignton to Exeter half-hourly service, and improvements in Cornwall. Passengers are going to suffer."

In Cornwall, retaining the Penzance to London sleeper was also part of the proposed new franchise.

Sarah Newton, Conservative MP for Truro and Falmouth, said she was reassured the government did understand the urgency. She said: "We're trying to second-guess what the review is going to find out. It may conclude that how the franchise is drawn up will proceed. At the moment, it is all just speculation."

West Coast Mainline delay sparks rail improvement fears

Planned improvements to rail services in and around Bristol are at risk as a result of the West Coast Mainline franchise delay, an MP has warned.

Bristol West MP Stephen Williams (Lib Dem) said: "What I think is at risk is all the local improvements that we were looking forward to in Bristol. There were those services on the Severn Beach line, maybe a line out to Portishead, lines across north Bristol and making better use of those railway lines that we already have in Bristol that are closed to passenger traffic," added Mr Williams.

Chris Irwin, from TravelWatch SouthWest, said: "Things that we as passengers would have benefited from, the promised new vehicles, the promised new station improvements, promised minor infrastructure improvements, can make a lot of difference to daily travel. Those have undoubtedly not happened now. When they do happen, there'll be years of delay and congestion to make up for."

Apart from the risk of losing planned local rail improvements, the cost of the delay is also being raised.

"We're right back at the drawing board. In terms of how it's going to move forward it's going to be hard to say how much it's going to cost. Some people say it's just the ^40m the bids themselves cost, but if you talk to people in the industry they say 10 times the cost, but perhaps a 100 times might be a better figure - we might be talking billions," added Mr Irwin.

Rail franchise delays could hamper network improvements

The delay in awarding new rail franchises could see knock-on effects for commuters on the First Great Western network.

Passenger groups warn as the operators seek compensation, improvements to the network could suffer.

Errors by the Department for Transport in the West Coast Main Line bidding process means the award of three new franchises across southern England is on hold while a review is carried out.

This would mean FGW may see an extension to its contract way beyond April 2013 and way beyond the rumoured July 2013 date that was mooted as the start date for the new Great Western franchise, given the difficulties that existed before the current suspension.

I would not be surprised if FGW are asked to manage the franchise (on a management fee basis, as with Virgin on the WCML) until at least April 2014. This would be a sop to First Group, and might disuade them from legal action. Can anyone suggest an alternative?

Given that electrification will make any tendering even more fraught I would have thought the best option is to terminate the current franchise as already agreed. Let DOR run the operation throughout the electrification project and restart any new franchise only when the electrification project is completed.

Of course First could pay the ^800 million (less any compensation they are rightfully due) and continue a further 3 years as per the current franchise agreement.

I personally would prefer the DOR option - I'm sure Ollie & co would be just as professional as DOR employees.  ;D

Civil servants running railways was a one-way ticket to disaster

Neill Mitchell laments the consequences of legislation in 2005 which reinstated direct state management of our railways, by Ministers and mandarins.

This week, ministers will be considering the findings of the first of the Department for Transport's two internal inquiries into the West Coast Mainline re-franchising fiasco. Hopefully, the outcome will be acknowledgement, at last, that DfT ministers and civil servants must stop meddling in the business minutiae of UK rail management, for which Government is simply not equipped.

The failure of the DfT's franchising process is rooted in the provisions of the ill-conceived Railways Act 2005. A plethora of transport analysts, columnists, lobbyists and passenger representatives sounded the alarm, back in 2004, as the Railways Bill was passing through Parliament.

These concerns were well understood by the then Conservative opposition spokesperson, Tim Yeo MP, who said in the Commons a second reading of the Railways Bill would: "Increase the extent to which politicians and civil servants will interfere in the running of the railways."

Mr Yeo added: "Even in the darkest hours of British Rail, when state control of the railways was unquestioned, there was never a time when so much power was seized by the Secretary of State and his civil servants in the department.We should allow train operators the freedom that they need to respond to consumer demand, and we should take politicians and officials in the department right out of the running of the railways."

As the bill progressed, more warnings were sounded. David Wilshire MP said: "We (Conservatives) do not agree with passing responsibilities, duties and powers upwards, ever further from the franchisees and the passengers, and ever closer to politicians and civil servants."

Intriguingly, while the then Labour Minister of State for Transport MP Tony McNulty's responses were defensive of the competencies of government, even he alluded to the potential for inadequacies, saying: "We have always said that civil servants and ministers are not well placed to deal with the substance or details of such work (specific clauses in the bill) and should not ^ we will not ^ get involved".

Royal Assent was granted and so the Railways Act 2005 came into force, with a huge body of informed opinion still cautioning that the act had effectively re-nationalised the railways by stealth. Thus returning responsibility for the operation of the railway to ministers and civil servants and diminishing much of the private sector's role to that of being mere contracted service providers.

A year later, in July 2006, I wrote in Rail magazine that the evident lack of joined-up government called for the DfT to be dismembered and UK transport policy integrated with the competitiveness and regional development responsibilities of the then DTI. By 2007, the predicted rail franchising problems were becoming reality, most noticeably in respect of the diabolical ruin of the Gatwick Express.

Another of my articles, relating to ever tighter DfT micro-management of rolling stock procurement at that time, followed under the headline: "Danger!! The Civil Service Express is approaching (or is it?!)". In March 2008, Rail magazine itself highlighted widespread complaints across the rail industry that the DfT was "guilty of the worst kind of meddling, control-freakery and micro-management". In November 2008, Rail carried a further feature reporting that DfT was being branded by senior industry players as "arrogant, stupid and ridiculous". Its editor Nigel Harris said: "We have an out-of-touch, arrogant department which takes advice from no one, knows all the answers and dismisses all inconvenient truths. Well, that can only go on for so long ^ and senior railwaymen have finally had enough." As, indeed, has been so clearly signified by Richard Branson's recent action in seeking a judicial review of the DfT's incompetent process for awarding the West Coast Mainline franchise.

Sadly, the chickens have come home to roost, seemingly at what could prove to be astronomic cost to the taxpayer. Particularly so if all past franchising assumptions and methodology applied by DfT under the Railways Act 2005 should now be subjected to similar scrutiny by winners and unsuccessful bidders alike, not least in respect of the Gatwick Express saga.

The message has to be that undue meddling has cost both the DfT and the taxpayer dear. It must stop. Civil servants do have a role to play in formulating UK strategic rail development and funding priorities on behalf of the taxpayer, but the day-to-day business management of the railways should be left to those who know best ^ the operators and customers. As for those who advocate re-nationalisation, surely this Whitehall farce speaks conclusively for itself!

in much the same way they have with Virgin

Probably far better off leaving Firstgroup to run it as a management contract until such time as the bidding process is able to be restarted. That way the trains will continue to run using management skills learn't during the past Umpteen years of First operating trains out of Paddington. Rather than some bunch of no hopers recruited out of an old folks home or something.

First handed the keys in early (iaw the T & C's of the franchise) to avoid paying in their view an excessive fee.

I thought all operational staff would be TUPE'd across so I can't really see why there should be such an issue. Surely the only change may be to HR, Finance etc.

First are not handing in the keys early - they are not exercising a legal option given to them to continue for a further three years beyond the original expiry date. There's a huge difference, but one that is lost on most people. The WC franchise didn't contain such an option, and if First had subsequently chosen to exit early that would be a default, so a completely different position. 

HR and finance staff should also be TUPEd across to a new TOC.  There's no significant difference - if you are salaried staff you are entitled to TUPE protection, it isn't just operational staff.

(Although some people even erroneously think TU stands for trade union - I'm assuming you don't...)

Paul

Andy W - I'll admit I haven't read the contract, but whether it is written as a 10 year contract with an option to terminate at 7 years or a 7 year contract with an option to extend for 3 years makes not a jot of difference legally - it's exactly the same thing, (and I think we agree on that).  I expect there are practical reasons why it is written as the former.

If the DfT were stupid enough to give the franchisee the option to terminate early, they can't complain if they take up the option (and to be fair I haven't heard any comment that says that they regard First's action in any way underhand or inappropriate).

Hi John, sorry I don't agree. First tendered for a 10 year contract with a fee of (approx) ^1billion. That is the full term contract. They did not bid for a 7 year contract for a fee of (approx) 200 million with an extension of 3 years for ^800 million.

On the other hand, whether you think it is immoral or not, could Firsts' Directors have been deemed legally negligent, if they'd approved the extension to the franchise and put the Group in a worse financial position because of it?

A slight qualification to that ... if one (or indeed) both parties can / could unilaterally select the shorter contract, then I don't see that the party/ies with the option of calling halt at the earlier date needed to be happy with the terms, conditions, fees of the potential longer contract.

Were all of the other bidders offered these terms I wonder?

This is why the GNER people walked away and why First did the same here.

Yes, nearly all had (have) the chance to walk away.  This is due to the backloading element where they would hand over big bonus to the DFT if the last years of the franchise produced the immense growth that they predicted that enabled them to get the contract in the first place.  This is why the GNER people walked away and why First did the same here. So Branson was spot on in his complaint.

On the other hand, whether you think it is immoral or not, could Firsts' Directors have been deemed legally negligent, if they'd approved the extension to the franchise and put the Group in a worse financial position because of it?

The GNER situation was quite different. The parent company, Sea Containers were in financial trouble and they couldn't back the franchise any more, AFAIK the government asked them to surrender the franchise because they were basically going bankrupt.

So where does that leave the Greater Western tender process, still in the sidings or back on track?

Presumably on hold awaiting the findings of the Brown review which is looking into the franchising system in general.

A DfT spokesman said: ^No decision on the Great Western franchise will been taken until we have considered the Brown report, but the Great Western invitation to tender states that each bidder shall be responsible for all costs, incurred whether or not the bid process is varied or terminated.^

Government faces 'challenge' to recruit vital rail experts

Attracting private sector rail experts to run government franchise teams in the wake of the West Coast Main Line fiasco will be a ^challenge^, the chairman of Eurostar told MPs.

Richard Brown, who last week published a report into the future of rail franchising, warned lower pay and the limitations of working in the civil service will make it difficult for the Government to recruit skilled staff from the private sector.

The Department of Transport has been told to strengthen its teams working on multi-billion pound rail contracts after it bungled the competition for the West Coast franchise last year - at a ^55m cost to the taxpayer.

Mr Brown told the Commons Transport Select Committee there were plenty of experts within the rail industry with experience of dealing with complex rail franchises. However, persuading those individuals to enter the civil service wouldn^t be easy, he suggested.

^I think there is a particular challenge for the department [of Transport], as there would be for any other government department, in getting those sorts of people to come and work within a civil service structure,^ Mr Brown said. ^They [the DfT] will have to take some difficult decisions about terms and conditions and pay, and give reassurances they will be given the headroom to actually deliver what the government want.^

Mr Brown was asked by the Transport Secretary, Patrick McLoughlin, to review how major contracts to run Britain^s railways should be handled, following the discovery of ^significant errors^ in the way the DfT managed the franchise competition for the West Coast Main Line.

The Eurostar chairman concluded the ^quickest and simplest^ way to resolve the crisis would be to leave responsibility with the DfT, despite calls for the creation of an arms-length body that could circumvent some of the pay restrictions within the civil service.

Mr Brown stressed to MPs on Tuesday that there is no need for a complete overhaul of the system. ^There is no need to go down the road of restructuring the industry,^ he said.

The Transport Secretary is shortly expected to announce how the Government intends to proceed with the three rail franchise competitions suspended in the wake of the West Coast debacle, which cover Great Western, Thameslink and Essex Thameside train services.

Mr Brown said he expects train companies to be asked for far more risk capital in future to insure against the possibility of defaulting on a franchise.
However, he said the Government must tolerate the fact there will always be a risk train companies could hand back the keys to a franchise. This happened in 2009 when National Express said it could no longer afford to run the East Coast Main Line.

^You have to accept that happens because the cost of insuring that will never happen^is an uneconomic cost,^ Mr Brown said.

He added: ^If you are asking private sector bidders to bid, the nature of the private sector is that from time to time you do get failures.^

West Coast Main Line franchise fiasco 'to cost at least ^50m'

A "complete lack of common sense" in the Department for Transport's handling of the West Coast Main Line franchise deal will cost taxpayers "^50m at the very least", MPs have said.

The cost might be "very much larger", the Public Accounts Committee warned. The committee accused the department of making "fundamental errors" and failing to learn from "previous disasters".

A spokesman said the department had taken steps to ensure there could be no repeat of the failure.

But Labour accused ministers of "hiding behind their civil servants".

Explaining why the total cost might prove to be higher than previous estimates, Labour MP Margaret Hodge, who chairs the committee, said: "If you factor in the cost of delays to investment on the line, and the potential knock-on effect on other franchise competitions, then the final cost to the taxpayer will be very much larger."

'Astonished'

Unveiling her committee's latest report, Mrs Hodge said: "The franchising process was littered with basic errors. The department yet again failed to learn from previous disasters, like the Metronet contract. It failed to heed advice from its lawyers. It failed to respond appropriately to early warning signs that things were going wrong. Senior management did not have proper oversight of the project. Cuts in staffing and in consultancy budgets contributed to a lack of key skills. The project suffered from a lack of leadership. There was no single person responsible from beginning to end and, therefore, no one who had to live with the consequences of bad policy decisions. For three months, there was no single person in charge at all. Not only that, there was no senior civil servant in the team responsible for the work, despite the critical importance of this multi-billion pound franchise."

The committee had been "astonished" that the Department for Transport's top civil servant had been "told he could not see all the information which might have enabled him to challenge the processes, although it was one of the most important tasks for which the department is responsible".

'Stench'

Mrs Hodge added: "Given that the department got it so wrong over this competition, we must feel concern over how properly it will handle future projects, including HS2 and Thameslink [rail routes]. The department needs to get its house in order and put basic principles and practices at the heart of what it does, with an appropriately qualified and senior person in charge of the project throughout and an accessible leadership team ready and willing to hear and act on warning signs."

In October, the government scrapped its decision to award the ^5bn franchise to FirstGroup.

The mistakes in the West Coast process came to light after rival bidder Virgin Trains launched a legal challenge against the decision. Virgin will continue running the service until November 2014, when a new long-term franchise will begin.

In December, the National Audit Office calculated that there would be a "significant cost to the taxpayer" as a result of the fiasco.

It said costs for staff, advisers, lawyers and the two reviews into the fiasco added up to ^8.9m, on top of the estimated ^40m it will take to reimburse firms for the cost of their bids.

Bob Crow, the leader of the RMT union, which represents rail workers, called for wholesale renationalisation of the railways.

"The stench from the fall-out of the West Coast franchise continues to hang over Britain's transport industry as it becomes clearer with every examination that the ministers responsible for this shambles could not be trusted to run a whelk stall let alone multi-billion government contracts," he said.

'Strengthening oversight'

"Privatisation is a corrosive and expensive political project doomed to repeated and costly failure, twice on the East Coast and now on the West," he added.

"Fiddling with processes won't work. It's the whole, rotten policy that needs dumping with a return to public ownership."

But a Department for Transport spokesman said: "The independent Laidlaw inquiry published in December identified the unique and exceptional circumstances which led to failures in the West Coast franchising programme and crucially what steps the department should take to prevent this from happening again. The department has accepted all the recommendations and has taken immediate steps by bringing together all rail activity under a single director general and recruiting a senior director to lead the franchising programme, as well as improving internal governance and strengthening oversight and accountability. Not only will these reinforce the franchising process but will also protect rail infrastructure projects such as HS2 and the biggest programme of rail electrification."

Maria Eagle, the shadow transport secretary, called on Prime Minister David Cameron to "take responsibility for the rail franchising fiasco, instead of allowing ministers to hide behind their civil servants."

"The government must accept the finding of the Public Accounts Committee that it was the short-sighted decision by ministers to axe external audits of multi-billion pound contracts that ended up with at least ^50m of taxpayers' money going down the drain," she added.

"It is a disgrace that every politician responsible for the bungled franchise deal has either remained in the cabinet or been promoted to it."

Richard Hebditch of Campaign for Better Transport, which fights for better public transport, said the report showed the biggest problem was the franchising system itself.

"Franchising needs to be completely reformed so that what counts are improvements to the service on offer, rather than complex calculations of profit and loss that don't stack up," he said.

Great Western franchise: Rail firms start legal action

By Richard Westcott
BBC transport correspondent

Four train companies have started legal proceedings against the government after it cancelled the bidding process for a rail franchise and then refused to pay compensation.

Ministers ditched bids to run the Great Western rail franchise in January, saying they wanted a rethink.

FirstGroup, Stagecoach, Arriva and National Express have gone to court in an effort to get their money back.

If they are successful, it could cost the government ^40m.

When the government called off the Great Western bidding process it said it wanted to re-evaluate it following the high profile collapse of the West Coast mainline deal a few months before.

The Great Western franchise operates between south Wales and London.

Options open

I have learned that there will now be a "stay" in the legal proceedings until the end of March, giving both sides the chance to thrash out a compromise. So there is a way to go yet before this gets legally nasty.

But these companies are very angry that they will not be compensated for what they see as the government's mistakes.

Ministers are compensating bidders who lost out on that defunct West Coast deal, and that, say the rail firms, is inconsistent and unfair.

Each firm will have spent about ^10m on the bidding process for the Great Western franchise, hiring large teams of experts and lawyers to put together their submissions.

Nigel Harris, the editor of Rail Magazine, says: "A refusal to refund may conform to the letter of the contract rules but utterly fails the 'right thing' test."

"It makes no sense to penalise innocent bidders - especially when you want and need them to re-bid!"

I am told it does not mean the rail companies will definitely sue the Department for Transport, but it is certainly piling on some legal pressure, and giving them the option of going to court if both sides cannot agree a deal.

However, lawyer Patrick Twist at Pinsent Masons, does not think it will get that far,

"By lodging papers with the High Court the bidders are keeping open their ability to pursue the Department for Transport for the costs they wasted on bidding for the cancelled Greater Western franchise procurement," he said.

"The department will strongly resist any claim and the same bidders will have the opportunity to rebid when the franchise is reprocured. So it would be surprising if this really does lead to litigation."

Further claims?

At the moment, the government does not look ready to budge.

In January, Transport Secretary Patrick McLoughlin said: "In keeping with the relevant invitations to tender, which made clear that bidders are responsible for their own costs, the Secretary of State does not believe it would be appropriate to reimburse bidders."

In fact, if you wade through the Invitation to Tender (not an easy read I grant you), this is what it actually says: "Each bidder shall be responsible for all costs, expenses and liabilities incurred by it in connection with the Great Western franchise letting process, whether or not its bid and/or associated negotiations are ultimately successful or the process is subsequently varied in any way or terminated."

It is impossible to say where all of this is heading. But if ministers do end up compensating these firms, even if it is just for a fraction of their costs, they can expect a lot of flack for the fact that yet more taxpayers money has gone on compensation, rather than improving the trains or cutting fares.

Remember, the government has already spent ^50m (and counting) cleaning up the West Coast mess.

There is also the possibility that it will open the door to claims from those companies affected by long delays to two other big franchises, Essex Thameside and Thameslink, Southern and Great Northern. Both have been postponed for a couple of years in the wake of the West Coast problems.

And the view from Christian Wolmar

http://www.christianwolmar.co.uk/2013/03/a-bluff-that-the-train-companies-can-only-lose/

I can't help wondering if at the end of the day, it'll be you and me (the British taxpayer) or you and me (the train traveller) who ends up footing the bill for all the aborted bids - by whatever circuitous route we pay.

I have to agree with Christian Wolmar. It would seem that the TOCs are on a hiding to nothing. Whilst it was the DfT who cocked up the ICWC franchise which then led to the cancellation of the Greater Western tender, it is also the DfT who have a fairly watertight clause in the bid process that allows them to do what they've done.

FirstGroup, I feel, have to tread particularly carefully. It is they who are in negotiation with the DfT over the two year management contract for the Greater Western franchise that will run from October 2013 until the next franchise's delayed start date. Negotiating with the DfT whilst also taking them to court.... that can't be a particularly harmonious state of affairs.

Snubbed train companies ^acting like lottery losers^

Four train companies trying to sue the Government for halting the process to bid for the right to run the West^s railways have been accused of acting like ^lottery losers demanding the price of their ticket back^.

Union leaders are furious that transport firms Stagecoach, Arriva, National Express and the current franchise holders First are taking the Government to court and are demanding as much as ^40 million in costs.

Earlier this year, the Government called a halt to the process where train companies bid for the franchise to run services out of Paddington to the West Country and South Wales, following the debacle surrounding the aborted process for the West Coast mainline, which runs from London to the North West. Ministers said they wanted to re-evaluate the process for the Great Western line ^ which serves London to Swindon, Bath, Bristol, south Wiltshire and Somerset ^ as a result.

The four companies that had submitted bids for the Great Western franchise claim they have spent around ^10 million submitting their cases, which involved hiring experts, lawyers and compiling their submissions.

Their case will be heard at the end of the month, giving a couple of weeks for the Government and the train companies to thrash out a deal.

The decision by the firms to sue has not impressed rail union leader Bob Crow, who said: ^These rail companies are acting like a lottery loser demanding the price of their ticket back. They are quite happy with the casino franchising process until they draw a losing hand. This latest nonsense will end up costing the taxpayer tens of millions of pounds and yet again exposes the insanity of rail privatisation. Only full renationalisation of our railways can end this circus.^

The rail companies appear to be facing an uphill battle in getting their costs back ^ the original invitations to tender included the line: ^Each bidder shall be responsible for all costs, expenses and liabilities incurred by it in connection with the Great Western franchise letting process, whether or not its bid and/or associated negotiations are ultimately successful or the process is subsequently varied in any way or terminated.^

The Great Western main line is about to undergo the biggest renovation in 100 years, with electrification starting at London and arriving in Bristol by the end of the decade. But the line is also the most overcrowded in Britain and has suffered a series of crippling delays caused by signalling problems, as well as problems caused by severe weather and flooding in Devon and north of Bristol.

Rolling stock fear over West of England rail franchise

Rail services in the West of England will stagnate following the collapse of the West Coast mainline franchise deal, regeneration experts fear.

The West of England Partnership said it had been told in government talks there would be no investment in rolling stock during an interim two-year franchise.

In October, the government scrapped its decision to award the ^5bn franchise to FirstGroup.

The government declined to comment on the partnership's claims.

However, a spokesman for the Department for Transport said it would negotiate an additional two-year current with the current operator in 2014 and it would seek the "best deal for taxpayers while maximising additional benefits for rail passengers".

"The longer-term proposals for the Great Western franchise will be set out in the spring," he added.

The WEP supports economic growth and investment in the region and represents the four unitary authorities for Bristol, Bath and Weston-super-Mare.

It said during talks the DfT "indicated there will be no service enhancements or additional rolling stock for the West of England area".

Julia Dean, from the WEP, said they were "disappointed" as rail travel was growing in popularity and there was already over-capacity on some lines.

Rob Dixon, from The Friends of Suburban Bristol Railways (FOSBR), said the decision would result in overcrowding along popular routes such as the Severn Beach line, which now attracts more than one million people a year.

He said: "We are concerned the railway is effectively being run from London whereas we want it run by an integrated transport authority based in our area, because we think people around here know what people want."

A spokesman for FirstGroup confirmed it was in discussions with the DfT about the opportunity to continue the franchise for a further two years beyond October 2013.

Rail franchising: Ministers to restart process

The rail franchising process is to restart, the government will say on Tuesday, six months after the collapse of the West Coast deal stopped it.

Ten of the country's 16 franchises are due for renewal before the general election, expected to be held in 2015, and a timetable will be set out.

Ministers will prioritise the East Coast line deal, BBC transport correspondent Richard Westcott says. It has been in public hands since National Express gave it up in 2009.

It is thought other franchise contracts will be extended to give officials more time to deal with the process.

Rail franchising was put on hold last year after a decision to award the UK's multi-billion-pound West Coast Main Line rail franchise to FirstGroup was scrapped by the government.

The transport secretary found there were "significant technical flaws" in the bidding process because of mistakes by Department for Transport staff and three civil servants were suspended.

Virgin Trains, which was given the right to run the West Coast line for a further two years while the system is sorted out, is understood to be keen to bid for the new East Coast contract.

Its contract to run the West Coast is also expected to be extended by another two years.

Any new franchise deals will put the focus more on passengers' views and satisfaction, our correspondent added.

I hate this 'will say' reporting.

West coast extended til 2017
Northern and TPE 2015
Crosscountry given 6 year extension til 2020

Great western remains unchanged.

CrossCountry is getting a 43 month extension, not a six year one.

First Great Western is getting an extension from this October to July 2016 (33 months).

You can read more on the Department for Transport site here: https://www.gov.uk/government/speeches/franchise-announcement

Update on FirstGroup rail franchises
Following an announcement by the Department for Transport (DfT) today, I can confirm to you the following with regard to our First Capital Connect, First Great Western and First TransPennine Express rail franchises.

The First Capital Connect franchise will continue beyond its current planned end date of 14 September 2013. As previously indicated the DfT is to exercise the option in the current contract of a 28 week extension. As well as this, we will continue our discussions in respect of an agreement for the franchise to continue for a further period of six months, to an end date of September 2014.

The First Great Western franchise will continue beyond its current end date of 31 March 2013. As previously announced, under the terms of the current franchise agreement the 28 week extension period will be activated. In addition we are in discussions with the DfT in respect of an agreement to continue the franchise for a further 33 months to July 2016.

 The First TransPennine Express franchise will continue beyond its current end date of April 2015. We will begin discussions with the DfT regarding a ten month extension to the current franchise to February 2016.

With the DfT also publishing the timetable setting out the return to rail franchising today, the extension of our three franchises provides continuity and consistency for our customers and enables us to continue to deliver considerable improvements to services. We can now look forward, reviewing the details of the upcoming franchise competitions as they are announced while continuing to provide the best service for our customers.
Vernon Barker MD ^ UK Rail

For Great Western, our plan is to put to market a competed management contract in 2016

Contract Start - March 2016

Indeed - but why not use the word 'franchise' unless what is going to be up for tender is materially different?

What's the difference between management contract and franchise?

What's the difference between management contract and franchise?

My feeling is that maybe there should be a public inquiry here...?!?! The system clearly cannot and does not work!

First rail franchise for London-Bristol service extended for three years

Wednesday, March 27, 2013

The Bristol Post

By Michael Ribbeck

RAIL firm First Great Western is to operate services between London and Bristol for the next three years, the government has announced.

The process for bidding for the tender for the rail franchise was thrown into chaos last year at a crucial time.

A mistake in the bidding process for another franchise, for the West Coast Mainline, meant that the whole process across the country had to be abandoned while an inquiry into the multi-million-pound mistake at the Department for Transport was carried out.

The decision could not have come at a worse time, with Great Western network gearing itself up for the ^5 billion plan to electrify the line between Bristol and the capital.

New services planned after electrification are expected to be faster and more frequent ^ but in the short term the work to upgrade the line is expected to lead to delays and cancellations for several years.

Although the bidding process has been halted First Great Western has been told it will continue running services in the region for another three years, until 2016.

The company took over the tender a decade ago and was originally criticised for the number of delays and cancellations. However First has dramatically improved performance on the route in recent years.

The existing franchise had been due to end this October but last month The Post reported that the government had indicated it would continue until 2015.

Yesterday the government announced that the new franchise was now due to start in July 2016.

Transport Secretary Patrick McLoughlin has published a timetable for all rail franchise arrangements over the next eight years.

He said: "This programme is a major step in delivering tangible improvements to services, providing long-term certainty to the market and supporting our huge programme of rail investment. Above all, in future franchise competitions we are placing passengers in the driving seat by ensuring that their views and satisfaction levels are taken into account when deciding which companies run our railway services.

"Franchising has been a force for good in the story of Britain's railways, transforming an industry that was in decline into one that today carries record numbers of passengers."

First said it was giving up the previous Great Western franchise in 2011, three years before it was due to end, saving the company from paying ^800 million to the taxpayer.

But the latest deal takes it far beyond the original end date for the franchise, which started in 2006.

A DfT spokesman said talks to finalise details of the deal on services up until 2016 were still ongoing.

First chief executive Tim O'Toole said: "This provides continuity and consistency for our passengers and enables us to continue to deliver considerable improvements to services.

"We look forward to reviewing the details of the upcoming franchise competitions as they are announced, and submitting further high-quality bids that deliver for passengers, taxpayers and shareholders."

Now, we learn that FGW are to continue with the Great Western franchise until 2016

Train firms drop ^40m lawsuit over Great Western costs

Four of Britain^s major train operators have dropped a lawsuit against the Government to recover up to ^40m of costs lost when the bidding competition for the Great Western rail franchise was scrapped earlier this year.

Arriva, FirstGroup, National Express and Stagecoach lodged a claim with the specialist Technology and Construction Court earlier this month, but later agreed to ^stay^ the proceedings to allow for further negotiations with the Department for Transport.

However, the companies have now decided not to press ahead and sue the Government, despite claims by one rail executive that they were still ^morally in the right^.

The move comes after Transport Secretary Patrick McLoughlin on Tuesday announced that the Government would award extensions for 12 rail franchises.

Dean Finch, the chief executive of National Express, told The Daily Telegraph that he believed the train operators were still ^morally in the right^, but the company had decided not to pursue the matter any further based on the available evidence.

A Stagecoach Group spokesman said: ^We are not pursuing the issue further and we consider the matter closed. Our focus is firmly on looking forward to support moves to get franchising back on track and deliver the planned extensions to our franchises.^

A spokesman for Arriva said: ^Following the stay in proceedings we have considered the DfT^s response and have decided not to pursue the matter further.^

National Express is currently negotiating with the Government over an extension to its c2c contract, which allows it to run trains between London Fenchurch Street and south Essex.

Stagecoach is in talks over extensions to its South West and East Midlands franchises, while its joint venture with Virgin Trains will continue to run the West Coast Main Line until 2017.

FirstGroup will continue to operate the Great Western franchise until July 2016.Mr McLoughlin sparked outrage in January when he cancelled the competition for Great Western services between London, Bristol and Cardiff and said that he would not reimburse the train companies, which spent up to ^10m each preparing bids. The franchise had originally been due to come to an end next month.

The auction was cancelled in the wake of the West Coast main line fiasco, which sparked a review of the franchising system in Britain.

The DfT declined to comment, but had previously argued that the document inviting train operators to tender for the franchise made clear that the Government would ^not be responsible for the costs or expenses^ of any bidder.

National Express on Wednesday announced it has won several new contracts, including one to run coach services between Luton airport and Victoria in central London for seven years. The services are expected to generate a minimum of ^6m of revenue a year.

If you are getting 3% on an instant access account FTN, please tell me where, there's a good chap!

Spend to save thus?   :D

I've only got a basic account with them, useful though as they do not charge me a cent for receiving my euros pension from NL (as the other big 4, usually ^25, what a nerve, do,  grrr, grrr).   :-[

I believe FTN was saying that he gets 3% back on his credit card spend.

I don't need to, the Trout already told us (see above).   ;) ;D

may i ask who else maybe in the running for renewal when it happens

They decided not to take that extension because the premium payments were heavily backloaded toward the end of the franchise and it was likely that they would be on something of a loser in those three years to 2016. You can't really blame them for not taking up the option to extend. It would likely have been a poor commercial decision to continue. Their share price and debt hasn't been particularly good over the past two years. Certainly not a company I'd be investing in if I had a bob or two to spare.

while both sides will likely be playing hardball, I fear First Group's ball is the one that will be harder. If not, then they'll be taking their ball and going home.

Bringing loco-hauled stock back to, say, Weston to Yate or Cardiff - Taunton or whatever would give a bit of relief to some peak commuters on those routes,

It would give a relatively cheap way...

bignosemac, you are some kind of genius!

... I've written to both my MP and the Department for Transport.

Only reply thus far has been a generic 'thank-you for your correspondence' from my MP's office. I hope she'll look into my suggestions further. She is after all advocating for rail service improvements in and around Bristol.

Since the latest capacity enhancements is there actually any need for relief on these routes? I haven't seen any comment re overcrowding for ages.

And I'm not sure that loco-hauled + coaches is a relatively cheap way, particularly if you need a loco on each end. I suspect it was a last resort that was used when DaFT realised they had screwed up and needed to buy some time.

This statement is of course true - we are currently working out what kind!  ;D

Remember when you were a kid? The politics of the playground?

"If I can't be Kenny Dalglish then I'm taking my ball home."

I may have given away a bit too much about my age there.

Isn't it nice when you grow up and leave those silly playground politics behind? What's that line about putting away childish things?

Well, it seems not everybody does. In fact it seems childish things might actually play a part in big business - and impact on all our lives.

This week we discover that Network Rail has rejected a bid by Virgin Trains to bring a direct rail link in between Shrewsbury and London. You know, the thing that businesses in the county have been crying out for.

First, let's remind ourselves why we don't have a direct link.

We did have one. In the form of the form of Wrexham & Shropshire. To stretch the playground metaphor to breaking point, they were the weird new kid. They did things differently. They got no money from the Government (I've stopped the metaphor now) but the big train companies did. Like every weird new kid (started it again) it was bullied and soon disappeared.

After much farce, one of the popular kids - Virgin (the metaphor has stopped again!) - said it would run a direct link. And everything seemed hunky dory.

Then, just last week, Virgin issued a statement DEMANDING that Network Rail, which owns and operates the county's railways, made millions of pounds worth of "customer-focussed improvements" to "compensate customers for poor punctuality".

It said it was preparing "enforcement action" to bring about punctuality improvements, following "sustained poor performance by Network Rail".

And then, coincidently (!) Network Rail announces Virgin can't have its direct line to London.

"I'm taking my ball home."

That's not their actual statement. That said they had acknowledged that performance on the West Coast line was not good enough but adding more services would mean a "trade off with punctuality" with a "significant negative impact on performance for the thousands of other passenger and freight services that rely on this route every day^.

So basically telling Virgin that if they want their current services to run on time, they can't have any more.

And who suffers from this apparent spat?

Yep, the customers that both sides claim to be trying to protect. Once again businesses and tourists are denied because men in grey suits can't get their act together.

The condemnation of the decision has been swift. But that is little comfort to passengers who are once again feeling the strain of the train.