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All across the Great Western territory => The Wider Picture in the United Kingdom => Topic started by: Lee on April 10, 2019, 08:16:12 am



Title: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: Lee on April 10, 2019, 08:16:12 am
https://www.gov.uk/government/speeches/east-midlands-south-eastern-and-west-coast-partnership-franchise-updates

https://www.gov.uk/government/news/more-seats-services-and-state-of-the-art-trains-for-passengers-on-new-east-midlands-railway

- East Midlands Franchise goes to Abellio East Midlands for 8 years from August 2019 - August 2027, with possible 2 year extension.

- DfT negotiating short-term extension to the current South Eastern franchise agreement with Govia until 10 November 2019, with an option to extend the agreement further to April 2020.

- DfT due to award the West Coast Partnership in June 2019.

Apparent ban on Stagecoach bidding - https://www.yorkshirepost.co.uk/news/transport/stagecoach-banned-by-government-from-competing-for-rail-franchises-1-9702477

https://dailybusinessgroup.co.uk/2019/04/stagecoach-disqualified-from-uk-rail-franchise-bids/

EDIT to add additional content/links


Title: Re: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: ChrisB on April 10, 2019, 09:54:46 am
I have some sympathy for Stagecoach - but it seems that they've only been banned from these franchises, according to the write-ups?


Title: Re: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: stuving on April 10, 2019, 10:12:54 am
I have some sympathy for Stagecoach - but it seems that they've only been banned from these franchises, according to the write-ups?

More to the point, the reports say that these three bids (presumably all that are under evaluation at the moment) were rejected as non-compliant. That's part of a bigger argument about the historic pension scheme, but even so it's hard to see it as a "ban".

The other implication of the reports is that Stagecoach bid in each case following the DRG agreed position - so did all the other bidders do the same, or did some break ranks? Plus, of course, is that collusion itself lawful ... ?


Title: Re: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: grahame on April 10, 2019, 10:20:36 am
https://www.gov.uk/government/speeches/east-midlands-south-eastern-and-west-coast-partnership-franchise-updates

Quote
The franchise is due to start on 18 August 2019 and will run for 8 years, until 21 August 2027, with an extension of 2 years callable at my discretion.

Is Chris Grayling signalling an intention of still being Minister for Transport about 8 years from now?  ;D. ... yes, I do understand that "my discretion" really mean "my role's discretion"


Title: Re: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: Lee on April 10, 2019, 11:00:51 am
#You like potato and I like potahto
You like tomato and I like tomahto
Ban, disqualification, non-compliance, discretion!
Let's call the whole thing off!#


Title: Re: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: grahame on April 10, 2019, 11:27:27 am
From the RMT (https://www.rmt.org.uk/news/rmt-on-news-stagecoach-is-banned-from-bidding-for-franchises/)

Quote
RMT ON NEWS STAGECOACH IS BANNED FROM BIDDING FOR FRANCHISES

RMT demands that Stagecoach contracts be taken into public ownership‎ as company is banned from bidding for rail franchises.

RAIL UNION RMT has demanded that immediate steps be taken to bring franchises involving Stagecoach into public ownership as it emerged that the company have been barred from bidding in the current round of franchise awards.

RMT has warned that services, and the jobs of thousands of rail workers, are now left hanging by a thread as the chaotic mis-management of Britain’s railways takes another turn for the worst. With 70% of the British public supporting public ownership RMT is stepping up campaigning in light of the latest news.

continues

So ... I think they're saying that the Government has made a mess of overseeing the running of the railways, so will they please take over and run the railways.  If they can't even run the contracts, what would be different if they tried to run the whole thing?  Genuine answers worringly sought.

Whoever / however this pans out, I suspect that trains will continue to run, lines be maintained, and skilled staff who perform those tasks will still be needed. Who gives them their pay 'cheque' may change, and there might be worrisome times as they're moved over from one employer to another, but are their thousands of jobs really at risk, or is there an element of scaremongering in there?

Isn't Williams supposed to be sorting this out?


Title: Re: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: Richard Fairhurst on April 10, 2019, 11:55:49 am
A few interesting things in the East Midlands franchise over and above the intercity fleet replacement (...what's the betting the 222s end up at CrossCountry?). Pleased to see the direct Melton/Oakham-London service over Harringworth Viaduct is continuing. Really not sure Corby merits a half-hourly service, but full marks for trying I guess. Confirmed that Liverpool-Nottingham is transferring to "another operator". Mostly incremental on the local services, but the hourly Peterborough-Doncaster via Lincoln looks good.


Title: Re: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: rogerw on April 10, 2019, 12:25:58 pm
My first thoughts on East Midlands are
Where are they going to get these modern diesel trains from to replace the HSTs next year?
There seem to be a lot of local trains promised air conditioning. New trains?
I like the promise of faster and more comfortable trains. Clearly not IETs then


Title: Re: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: SandTEngineer on April 10, 2019, 01:47:35 pm
Stagecoach response to ban: https://otp.investis.com/generic/regulatory-story.aspx?cid=273&newsid=1246762  (Mods: Might be better to create a new topic for this?)

Quote
10 April 2019

Department for Transport rail franchising programme

Stagecoach Group plc ("Stagecoach") has been informed by the Department for Transport ("DfT") that it has been disqualified from the current three UK rail franchise competitions.

Stagecoach was shortlisted in the following franchise competitions:

• East Midlands where it was bidding independently

• South Eastern where it was bidding with support from its intended partner Alstom

• West Coast Partnership where it was part of a joint bid with Virgin Group and SNCF

A senior DfT official has verbally informed Stagecoach that it has been excluded from all three competitions for submitting non-compliant bids principally in respect of pensions risk.

Bidders for these franchises were asked to bear full long-term funding risk on relevant sections of the Railways Pension Scheme. This is at a time when The Pensions Regulator is seeking additional funding because of serious doubts over the Government's ongoing support for the industry-wide scheme.

Stagecoach Group Chief Executive Martin Griffiths said: "We are extremely concerned at both the DfT's decision and its timing. The Department has had full knowledge of these bids for a lengthy period and we are seeking an urgent meeting to discuss our significant concerns.

"We have drawn on more than two decades of rail experience and worked in partnership with local stakeholders to develop high quality proposals to improve each of these rail networks.

"We bid consistent with industry guidance issued by the Rail Delivery Group and shared with the DfT. Without ongoing Government support for the long-term funding of railway pensions, The Pensions Regulator has indicated that an additional £5billion to £6billion would be needed to plug the gap in train company pensions.

"In contrast, the rail industry proposed solution would have delivered an additional £500million to £600million into the scheme. This would have provided better stability and security for members and much better value for taxpayers.  We are shocked that the Government has rejected this for a higher risk approach. We would urge that a full independent value for money review is undertaken into this issue without delay.

"Along with many other train companies, we believe strongly that the private sector should not be expected to accept material risks it cannot control and manage. In fact, this was a key finding of the Brown review into rail franchising more than six years ago. We are therefore extremely surprised that the Government still expects private operators to take risks they are not best placed to manage, despite the recent difficulties experienced by a number of operators of outsourced public sector contracts.

"Forcing rail companies to take these risks could lead to the failure of more rail franchises and cannot be in the best long-term interests of either customers, employees, taxpayers or the investors the railway needs for it to prosper.

"This is more evidence that the current franchising model is not fit for purpose, a view which has already been expressed by Keith Williams, who is leading the independent review of the rail system.

"It also further damages the already fragile investor confidence in the UK rail market and it undermines the involvement of two of the last British transport groups who are part of running Britain's railway.

"Over more than 20 years, we have delivered industry-leading performance, record passenger growth, excellent industrial relations, and the highest levels of customer satisfaction in the sector. We will continue to focus on delivering high quality services for our customers at our existing rail businesses."

ENDS

And from the BBC: https://www.bbc.co.uk/news/business-47877858

Quote
Stagecoach says it is "extremely concerned" after the Department for Transport (DfT) barred it from three UK rail franchise bids.

The DfT says the bids for the East Midlands, South Eastern and West Coast franchises were "non-compliant" because they did not meet pensions rules.

Martin Griffiths, chief executive of Stagecoach, has called for an "urgent meeting" with the DfT.

Stagecoach had "repeatedly ignored established rules", the DfT said.

Mr Griffiths said in a statement: "We are extremely concerned at both the DfT's decision and its timing. The department has had full knowledge of these bids for a lengthy period and we are seeking an urgent meeting to discuss our significant concerns."

Bidders for the franchises have been asked to bear full long-term funding risk on relevant sections of the Railways Pension Scheme, Stagecoach said. The Pensions Regulator has estimated the UK rail industry needs an additional £5-6bn to plug the pensions shortfall, and the company said it was being asked to take on risks it "cannot control and manage".

Mr Griffiths said: "Forcing rail companies to take these risks could lead to the failure of more rail franchises and cannot be in the best long-term interests of either customers, employees, taxpayers or the investors the railway needs for it to prosper."

It was, he said, "more evidence that the current franchising model is not fit for purpose" and "further damages the already fragile investor confidence in the UK rail market".

Stagecoach had bid independently for the East Midlands franchise, had intended to partner with Alstom for the South Eastern operations, and was jointly bidding for the West Coast Partnership with Virgin and SNCF.

Stagecoach shares fell almost 10% in early trading.

'Ignored rules'

A DfT spokesman said that other bidders had met its requirements, and also announced that the East Midlands franchise had now been awarded to Abellio "after they presented a strong, compliant bid".

He said: "Stagecoach is an experienced bidder and fully aware of the rules of franchise competitions. It is regrettable that they submitted non-compliant bids for all current competitions which breached established rules and, in doing so, they are responsible for their own disqualification.

"Stagecoach chose to propose significant changes to the commercial terms for the East Midlands, West Coast Partnership and South Eastern contracts, leading to bids which proposed a significantly different deal to the ones on offer.

While Stagecoach has played an important role in the UK railways industry, "it is entirely for Stagecoach and their bidding partners to explain why they decided to repeatedly ignore established rules by rejecting the commercial terms on offer".

Stagecoach, which also has a huge bus division, currently operates the East Midlands rail franchise between London St Pancras International and destinations including Leicester, Derby, Sheffield, Nottingham, Manchester and Liverpool.

The company has a 49% share in Virgin Rail and also runs the Sheffield Supertram.

Stagecoach's East Coast franchise was renationalised last year following poor performance and mounting losses.


Title: Re: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: ChrisB on April 10, 2019, 02:02:54 pm
If they are shown to have disregarded the rules in their submissions, I'm guessing they'll owe their partners some compensation for self-disqualifying them too?


Title: Re: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: Celestial on April 10, 2019, 02:24:51 pm
I can't imagine they would (or even could) put a bid in without it being agreed by all the partners to the bid.


Title: Re: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: bignosemac on April 10, 2019, 02:31:18 pm
So, what will Abellio order for the "bi-mode" inter-city fleet that will be replacing the current high speed fleet at East Midlands?

My prediction is the order book at Newton Aycliffe will soon be swelled.

I suspect the East Midlands regional fleet of Class 15x will be replaced by Class 170s cascaded from one of Abellio's other franchises, Greater Anglia.


Title: Re: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: bradshaw on April 10, 2019, 03:01:27 pm
https://www.railwaygazette.com/news/single-view/view/stagecoach-disqualified-from-three-franchises-in-pension-dispute.html

This article makes interesting reading. I would think and experienced operator like Stagecoach would have discussed this with its partners. There seems to be a significant financial risk which the DfT is placing on the operators.

Quote
Stagecoach Chief Executive Martin Griffiths said 'Along with many other train companies, we believe strongly that the private sector should not be expected to accept material risks it cannot control and manage’,

I would expect this to be contested at the Courts to get a definitive judgement


Title: Re: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: bignosemac on April 10, 2019, 04:32:47 pm
It wouldn't be the first time Stagecoach have started legal action after a DfT decision pertaining to franchise letting.


Title: Re: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: bradshaw on April 10, 2019, 05:06:06 pm
Richard Branson has written the following at
https://www.virgin.com/richard-branson/virgin-trains-could-be-gone-uk-november

Quote
We’re baffled why the DfT did not tell us that we would be disqualified or even discuss the issue – they have known about this qualification in our bid on pensions for months.

Our first priority is always to look after our teams. The pensions regulator has warned that more cash will be needed in the future, but no one knows how big that bill might eventually be and no responsible company could take that risk with pensions. We can’t accept a risk we can’t manage - this would have been reckless. This is an industry-wide issue and forcing rail companies to take these risks could lead to the failure of more rail franchises.
We have significant concerns over the latest developments and their implications for the future of the UK rail market. We are still looking closely at the decision and we are now considering our options.



Title: Re: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: Electric train on April 10, 2019, 08:45:35 pm
I can understand why the Government want to have the Railway pensions as part of the bit; when the railways were privatised there were 2 things the Unions gained in the Act -
  • Staff travel to be safeguarded for BR employees which is tranferable between "railway employers"
    Railway Pension Scheme, "the indefencible right" for people who have been TUPE 'd they basically have the same pension rights as they had in BR, for those us who have moved employers we still have a number of protections eg if i move employer they have to offer me membership of their RPS

As the Railway Pension Scheme is part of the Act that privatised the Railway this mean HMG has potentially the lieablity, also they are very mindful of the recent business that crashed BHS, Carillion all of which has had high media interest HMG just would not want the poo that would come their direction if a contract they have awarded to a company that subsiquently went bust meant HMG were implimented in pensions fund collapse.

The RPS also has another acute issue, Railway people tend to be long serving, with privatision now 25 years ago and the RPS scheme is 40 years and many of the railway companies ceased offering the full RPS years ago it dont take much working out to see there is a very large draw on the railway pension fund ................ which is started to happen
 


Title: Re: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: Timmer on April 10, 2019, 09:10:41 pm
Serious questions have to be asked when two companies Stagecoach and Virgin have acted in the way that they have of the seriousness of the money needed to fund railway pensions. Could we see the same from Firstgroup when it finally comes to bids being invited for the GW franchise?

If I was to bet who’s got it right and who has got it wrong I’m going to have to go with the private companies here. I think the government are being unrealistic to expect them to shoulder the funding of the railway pensions in return for a franchise. Gosh, Dft are struggling to get companies to bid as it is.



Title: Re: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: martyjon on April 11, 2019, 08:41:57 am
Someone from Stagecoach was on BBC Radio 4 Today programme earlier this morning, didn't catch his name as was in shower at time.

Question of pensions was inevitably addressed and spokesperson said that the requirement to make a contribution to railway pension fund was only added by the DfT AFTER the announcement of the shortlisting of the pre-qualifiers. He also sort of stated that in the Railways Privatisation (under the Tories) the railway pension scheme liquidity was guaranteed by HM Treasury but now the government want to transfer that liability onto the rail operators collectively expecting them to pay the continuing pensions of those pensioners who were pensioned off BEFORE privatisation but without the previous owners of the nationalised railways (HMG) making any contribution at all.

I expect 'fireworks' to come, this isn't going to go somwhere and lie down IMHO.


Title: Re: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: Timmer on April 11, 2019, 10:50:52 am
It's not just Stagecoach and Virgin.

Tweet from Roger Ford Modern Railways
Quote
In contrast the Stagecoach story is the lead item in the Daily Telegraph city page, which reports that Arriva's East Mids bid was also non compliant and excluded. So with all bids for South Eastern non compliant and two out for East Mids everyone was out out of step but Abellio.

One can only assume that the Dutch government is happy to fund UK rail workers pensions.


Title: Re: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: Lee on April 11, 2019, 11:13:38 am
Do we know whether the First/Trenitalia and MTR/Guangshen/Renfe bids for the West Coast Partnership are compliant?


Title: Re: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: bignosemac on April 11, 2019, 11:40:51 am
Do we know whether the First/Trenitalia and MTR/Guangshen/Renfe bids for the West Coast Partnership are compliant?

Only insomuch as Failing of the DfT has said he'll be awarding the WCP franchise in June.

If there were no compliant bids still in the mix then I would have expected him to have said so. But then we're talking about rail franchising and the worst SoS ever to walk through the DfT's door on Marsham St, so any outcome is possible.


Title: Re: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: grahame on April 11, 2019, 12:26:28 pm
... SoS ever to walk through the DfT's door on Marsham St, so any outcome is possible. ...

<pedantmode>Horseferry Road?</pedantmode>. I will admit to going to Marsham St by mistake the very first time I visited the DfT ... and that was well before Mr Grayling got the Secretary of State role.

It has struck me as faintly amusing that our Department for Transport is now situated on a road name after an archaic form of transport - the horse ferry!


Title: Re: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: bignosemac on April 11, 2019, 01:58:40 pm
Yes, grahame. Same building. The entrance moved some years ago from Marsham St round the corner to Horseferry Rd.


Title: Re: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: ChrisB on April 11, 2019, 04:12:25 pm
No one has yet emphasied that pension liability for the year's of any franchise will extensd to years well after the end of said franchise....which explains why Stagecoach et al are saying that they can't accept the risk for something they can't control...they must surely win at court or else there won't be any future bidders & the DfT/HMG will have to fund it anyway....


Title: Re: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: Timmer on April 11, 2019, 05:25:59 pm
I have little if any confidence that HMG/Dft have learned their lesson from the last fiasco involving giving the WC franchise to Firstgroup. Though a different situation, both revolve around the same thing...money and oooozzz gonna pay for it!

Another potential humiliating experience could befall them in court me thinks.


Title: Re: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: eightonedee on April 11, 2019, 09:41:05 pm
Quote
One can only assume that the Dutch government is happy to fund UK rail workers pensions.

...or have not been thorough enough in doing their due diligence or reading the small print?


Title: Re: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: Electric train on April 12, 2019, 07:35:31 pm
I can understand why the Government want to have the Railway pensions as part of the bit; when the railways were privatised there were 2 things the Unions gained in the Act -
  • Staff travel to be safeguarded for BR employees which is tranferable between "railway employers"
    Railway Pension Scheme, "the indefencible right" for people who have been TUPE 'd they basically have the same pension rights as they had in BR, for those us who have moved employers we still have a number of protections eg if i move employer they have to offer me membership of their RPS

As the Railway Pension Scheme is part of the Act that privatised the Railway this mean HMG has potentially the lieablity, also they are very mindful of the recent business that crashed BHS, Carillion all of which has had high media interest HMG just would not want the poo that would come their direction if a contract they have awarded to a company that subsiquently went bust meant HMG were implimented in pensions fund collapse.

The RPS also has another acute issue, Railway people tend to be long serving, with privatision now 25 years ago and the RPS scheme is 40 years and many of the railway companies ceased offering the full RPS years ago it dont take much working out to see there is a very large draw on the railway pension fund ................ which is started to happen
 


I kinder guessed the Trade Unions have reacted in a quite forthright manor to what the DfT are doing, quite rightly too


Title: Re: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: LiskeardRich on April 12, 2019, 08:10:37 pm
Being the ever sceptical, have the DfT looked with a fine tooth comb for a non compliance as an excuse to boot Stagecoach following the East Coast Fiasco?


Title: Re: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: Celestial on April 12, 2019, 09:17:09 pm
Being the ever sceptical, have the DfT looked with a fine tooth comb for a non compliance as an excuse to boot Stagecoach following the East Coast Fiasco?


I'm not sure that's the case. It sounds as though bidders have (with the exception of Abellio) walked away from the government who changed the goalposts and asked them to take on future increases in pension costs. So, South Eastern has had no "complaint bids" and remains unlet, but the government got luck with East Midlands and Abellio.

I've seen comment that the risks and costs involved could dwarf the expected profits bidders would hope to make. Also, that if the government succeeds in transferring the pension costs, that will itself cause the costs to rise as the train operators are considered by the pensions regulator less secure than the government, so it will demand more money be put into the funds. Just what the bidders are worried about.

So, all rather complicated, but I can see why most bidders seem to have run a mile. I wonder whether Abellio still thinks it has done the right thing, and if the Dutch government thinks so too.   


Title: Re: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: mjones on April 13, 2019, 07:43:12 am


I've seen comment that the risks and costs involved could dwarf the expected profits bidders would hope to make. Also, that if the government succeeds in transferring the pension costs, that will itself cause the costs to rise as the train operators are considered by the pensions regulator less secure than the government, so it will demand more money be put into the funds. Just what the bidders are worried about.



One of the biggest failings of privatisation in general has been the delusion that transfering risk to the private sector will save money in the long term.


Title: Re: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: Electric train on April 13, 2019, 08:10:42 am
Being the ever sceptical, have the DfT looked with a fine tooth comb for a non compliance as an excuse to boot Stagecoach following the East Coast Fiasco?


I'm not sure that's the case. It sounds as though bidders have (with the exception of Abellio) walked away from the government who changed the goalposts and asked them to take on future increases in pension costs. So, South Eastern has had no "complaint bids" and remains unlet, but the government got luck with East Midlands and Abellio.

I've seen comment that the risks and costs involved could dwarf the expected profits bidders would hope to make. Also, that if the government succeeds in transferring the pension costs, that will itself cause the costs to rise as the train operators are considered by the pensions regulator less secure than the government, so it will demand more money be put into the funds. Just what the bidders are worried about.

So, all rather complicated, but I can see why most bidders seem to have run a mile. I wonder whether Abellio still thinks it has done the right thing, and if the Dutch government thinks so too.   


If you look at Abellio web site and their statement in "The Abellio Way"
Quote
175 years of experience has embedded in Abellio a social duty to passengers which extends beyond the journey on one of our trains, trams or buses. The passenger is at the heart of everything we do. The delivery of safe, reliable and comfortable services is the starting point for every transport provider, but that is not enough for Abellio. Our services must play an integrated role in the socio-economic development of the societies we serve. 
They are perhaps less motivated about profit looks like they are part of NS.  We are more likely to see the likes of SNCF and DB buying into UK railway especially when (if) we leave the EU because will not be able to contest EU state "owned" companies taking up contracts in the UK via the ECJ …………….. that is what taking back control is all about ….. isn't it  :-\


Title: Re: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: Lee on April 15, 2019, 09:37:29 am
Stagecoach demands ‘full and transparent explanation’ over pensions ruling - http://railnews.mobi/news/2019/04/15-stagecoach-demands-full-and-transparent.html


Title: Re: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: bignosemac on April 15, 2019, 10:01:45 am
We are more likely to see the likes of SNCF and DB buying into UK railway

Deutsche Bahn are looking to sell their UK based subsidiary, Arriva.

SNCF do not operate, and have never bid for, franchises in their own right. They've only ever been a minority partner in bids. Their subsidiary Keolis (which they 70% own) operates one heavy rail franchise in the UK, Transport for Wales, but that is a joint 50/50 partnership with Amey. Keolis are also minority partners in Govia, the operators of the Govia Thameslink Railway and Southeastern franchises.

SNCF's involvement in UK heavy rail is very diluted. To the extent that UK listed companies are the majority partner in any venture they are involved in. I don't see that changing.


Title: Re: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: grahame on April 15, 2019, 01:39:35 pm
See http://www.firstgreatwestern.info/coffeeshop/index.php?topic=20844.msg262945#msg262945 ... Stagecoach looking at buying Arriva ...


Title: Re: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: Lee on April 16, 2019, 08:27:43 am
DfT deadline for pensions explanation is just hours away, with MPs Committee for Work and Pensions also now involved - http://railnews.mobi/news/2019/04/16-dft-deadline-for-pensions-explanation.html


Title: Re: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: grahame on April 17, 2019, 07:35:24 pm
DfT deadline for pensions explanation is just hours away, with MPs Committee for Work and Pensions also now involved - http://railnews.mobi/news/2019/04/16-dft-deadline-for-pensions-explanation.html

A further update from the same source - https://www.railnews.co.uk/news/2019/04/17-dft-responds-to-stagecoach-demands.html

Quote
THE Department for Transport has responded to the demand from Stagecoach Group for a ‘prompt, full and transparent response to help restore public confidence’ after three franchise bids from the Group were rejected on the grounds that they attempted to reduce pensions risk.

It had been reported that the deadline was 16.00 on 16 April, but Stagecoach has now clarified that the deadline was actually 24 hours earlier, and that a response has been received.

However, the matter appears to be far from settled.

A spokesman for Stagecoach said: ‘We can confirm we have received a letter from the DfT, which we are reviewing in detail. However, we consider the response to our questions to be both vague and incomplete, leaving many of the fundamental issues and concerns raised by ourselves and other parties unaddressed.’

Stagecoach has been told that its bids for East Midlands, South Eastern and West Coast Partnership have all been rejected, because its alternative proposals for pensions were not acceptable to the government.

The full text of the DfT response to Stagecoach has not been published.

It has also been confirmed that Arriva was also barred from bidding for East Midlands, again because it had attempted to reduce the pensions risk, leaving Abellio as the only contender.

Stagecoach has asked that the confirmation of the Abellio award, which would normally follow after a ten-day standstill period, be delayed by a further fourteen days. Again, it is not yet known whether the DfT has agreed to this.


Title: Re: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: bradshaw on April 19, 2019, 08:04:18 pm
The plot thickens, apparently ‘Stagecoach has called for an inquiry into the way rail franchises are awarded, after details of a bid it submitted were sent to a rival’.

https://www.bbc.co.uk/news/business-47990807


Title: Re: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: LiskeardRich on April 20, 2019, 03:36:18 am
So Stagecoach didn’t comply with the ITT. Doesn’t like it when the DfT called their bluff. Sound like bad losers?


Title: Re: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: grahame on April 20, 2019, 07:00:24 am
So Stagecoach didn’t comply with the ITT. Doesn’t like it when the DfT called their bluff. Sound like bad losers?

Neither side comes out smelling of roses ... it also strikes me as pretty poor practise to put out an ITT which so many bidders don't copy with that it reduces the bidder pool to an impractically small group (or singleton).  Unless, of course, that decision to write the ITT in that way was or is part of a bigger plan.


Title: Re: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: Electric train on April 20, 2019, 08:40:56 am
So Stagecoach didn’t comply with the ITT. Doesn’t like it when the DfT called their bluff. Sound like bad losers?

Neither side comes out smelling of roses ... it also strikes me as pretty poor practise to put out an ITT which so many bidders don't copy with that it reduces the bidder pool to an impractically small group (or singleton).  Unless, of course, that decision to write the ITT in that way was or is part of a bigger plan.

Its part of a bigger plan …………. UK Government particularly the flavour we have at the moment want to substantially reduce the Tax payers contribution the Governments view is the railways should be totally self funding; the only public money would be to support a social need.

So the DfT ITT for TOC's and the NR CP6 are more in that vain, the NR CP7 will I am sure have a heavier reliance on the railways seeking external investors; a couple of examples to watch will be East Corydon Stn and Clapham Jcn Stn redevelopment which are being worked on now in readiness for CP7 and 8


Title: Re: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: Celestial on April 20, 2019, 09:49:16 am
So Stagecoach didn’t comply with the ITT. Doesn’t like it when the DfT called their bluff. Sound like bad losers?

So they threatened to sue DfT in 2012 over the loss of the West Coast franchise and were proved right within a couple of days, despite the government protesting otherwise before it admitted it had screwed up.  Bad losers then?

Also, I think I'd be sore if I learnt that my bid details had been passed to the winning bidder two weeks before final bids were due in.  Can the government really be sure that the email attachment wasn't opened, as they say.

Even if they were allowed access to Abellio's computers to check (which I doubt), could forensics spot if an email was opened on a home computer, and the attachment copied onto that computer rather than opened.


Title: Re: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: Timmer on May 08, 2019, 04:44:22 pm
From BBC South’s Transport Correspondent Paul Clifton on Twitter:
https://twitter.com/paulcliftonbbc/status/1126141356785717248?s=21

Quote
Legal action launched against @transportgovuk by @stagecoachgroup over “opaque decision making” following exclusion from three franchise bids.


Title: Re: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: Timmer on May 08, 2019, 07:08:48 pm
More on the decision by Stagecoach to go to the High Court:
https://www.railwaygazette.com/news/news/uk/single-view/view/stagecoach-goes-to-court-over-east-midlands-franchise-disqualification.html

Quote
Stagecoach Group commenced legal action against the Department for Transport on May 8, preventing the award of the next East Midlands franchise to NS subsidiary Abellio which had been named the preferred bidder on April 10. The initial 10-day standstill period had already been extended, and was due to expire at midnight on May 8.

Stagecoach has issued its claim at the High Court in London under Part 7 of the Civil Procedure Rules, alleging that DfT breached its statutory duties under Regulation 1370/2007, which requires the government to adopt a competitive tendering process which is open to all operators, fair, transparent and non-discriminatory.

Incumbent Stagecoach was disqualified from the East Midlands bidding process after its bid was deemed non-compliant. The issue centres on the way the next franchise would change the allocation of financial risk associated with the industry-wide Railways Pension Scheme.
Continues...


Title: Re: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: grahame on May 08, 2019, 08:20:49 pm
From UK parliament - Commons select committees (https://www.parliament.uk/business/committees/committees-a-z/commons-select/transport-committee/news-parliament-2017/railway-pension-scheme-correspondence-17-19/)

Quote
Background

Further to the announcement that the East Midlands franchise had been awarded to Abellio on 10 April, the Transport Committee and Work and Pensions Committee united to write to the Secretary of State for Transport, Chris Grayling MP with eight questions.

Chair of the Transport Committee, Lilian Greenwood MP:

“These issues raise serious questions for the future of the franchising system. We’ll be putting these questions to the rail minister, Andrew Jones MP, in our evidence session this morning.”

Chair of the Work and Pensions Committee, Frank Field MP:

“What a wretched mess, for pension scheme members and commuters alike – no clear plan for fixing it and a multi-billion pound obstacle on the track. Let’s hope the Rail Minister has some answers this morning.”

Site contains correspondence ...


Title: Re: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: Lee on May 10, 2019, 09:04:40 am
La la la, they cant hear you...

https://www.nottinghampost.com/news/local-news/abellio-confirmed-new-operator-east-2851466

Quote from: NottinghamshireLive
A Department for Transport spokeswoman added: "We have now signed the contract confirming Abellio as the new operator of East Midlands Railway from August 2019.


Title: Re: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: Cava on May 10, 2019, 09:31:16 am
I think I understand why taking on extra pension responsibility would be bad news for train operators like Stagecoach, but I am struggling to understand why it would be bad news for us, the passengers and taxpayers.

Could someone possibly explain the ins and outs of that for me - Sorry!


Title: Re: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: stuving on May 10, 2019, 10:00:04 am
Site contains correspondence ...

If you read those letters, it's hard to understand the argument - they don't seem to be talking about the same ITT. But I think it's something like this:

  • TOCs have always had to bear their share of any extra funding of their bit of the rail pension scheme (RPS), when a deficit needed repair.
  • The RPS is an unusual scheme, in that all funding - including deficit repair - and any excess to be repaid is split 60/40 with the employees (via their unions). In most sponsored schemes the company bears the whole liability for adequate funding, which is why the pension deficit/surplus appears in their balance sheet.
  • In a "normal" scheme, the deficit repair payments can be much larger than the contributions based on salaries paid. There isn't any way for such one-off payments to happen in the RPS. I imagine that the employees' side could never come up with a large "bung" to the RPS, and TOCs have come to rely on their maximum contribution being effectively capped by that.
  • What's changed is that the pensions regulator (TPR) is now telling schemes and sponsors to repair deficits faster - in the past this was often done one a 20-year or longer timescale. They want this done to the RPS too, though note that the size of its deficit is not public information.
  • There are discussions still going on involving TPR, RPS trustees, unions, TOCs (via RDG), and maybe DfT, about faster deficit repair than the current rules of RPS allow for. That might imply new rules (though that's a separate argument).
  • So I can only infer that TOCs are being asked to commit to paying whatever comes out of this negotiation, which is (as Stagecoach are saying) not within their control. It wouldn't be a real negotiation if it was, would it? (Though sponsoring companies do, in the end, generally get their way whatever a scheme's trustees say.)


Title: Re: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: Cava on May 10, 2019, 10:52:10 am
Thanks for doing that stuving, that's great. I hadn't considered a couple of points in there, and it is a lot clearer for me now.

So does that mean bidding for franchises on these terms is like rolling the dice, with operators like Abellio willing to gamble on the outcome of negotiations that could take years, and operators like Stagecoach not willing to risk it?


Title: Re: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: grahame on May 12, 2019, 08:04:31 pm
Now Arriva are joining Stagecoach in taking the DfT to court.

From The Guardian (https://www.theguardian.com/business/2019/may/12/arriva-takes-uk-to-court-over-east-midlands-rail-franchise)

Quote
Chris Grayling’s embattled transport ministry faces a second legal challenge over the way the East Midlands rail franchise was awarded, from Arriva Rail, owned by Germany’s state-backed Deutsche Bahn.

Who pays for these legal challenges?


Title: Re: East Midlands, South Eastern & West Coast Franchise Updates April 2019
Post by: ellendune on May 12, 2019, 08:35:19 pm
Who pays for these legal challenges?

Depends who wins!



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