Government cancels decision to award rail franchise for West Coast Main Line to FirstGroup

[whole diary]

[eightf48544]

Just heard on the Today programme it's all up in the air again. Transport minister (who) on after 08:00.

Also the 3? franchises currently out to tender also on hold. Pressume includes Greater Western.

The Wolmar question!

[Rhydgaled]

However, It does beg to bring the question that is there something much more underhat here? I'm always intrigued into conspiracy theories, and I have 1 or 2 regarding this recent press release. One of which when compared to another Intercity Route is entirely plausible and I cannot be the only one who's thought it?!!

East Coast is now under Public Ownership as part of DOR. It was meant to be re-franchised; but to date it hasn't (NXEC^▸ (National Express East Coast) went bang a number of years ago.) Sparking the rumor that the Government was receiving a tidy sum from it's running. So is it completely unrealistic to say, that someone high up the food chain has realised they could potentially make more money from a nationalised WCML^▸ (West Coast Main Line) in a similar way to ECML^▸ (East Coast Main Line)? Personally, I can see how somebody has realised this and has effectively covered it up. (Sounds wrong, but has been done before in cases not exclusively to the railways)

If this all takes a considerable time to resolve, we could potentially be seeing other franchises pass into Public Ownership (GWML^▸ (Great Western Main Line) etc).

Either way... Looks like a lot of 'big names' (and I use that term very loosely) are more than just in the dog house........

Interesting conspiracy theroy. Mine is that the DfT^» (Department for Transport - about) civil servants that support the enviromentally perverse bi-mode IEP^▸ (Intercity Express Program / Project.) helped sway the outcome towards First Groups' bid, the only one (I believe) not to include replacment of Voyagers, to avoid the release of around 20 125mph diesel trains (which could be used to avoid new-build bi-modes) from ICWC^▸ (InterCity West Coast).

[grahame]

Press Release

http://www.dft.gov.uk/news/press-releases/dft-press-20121003a/

"West Coast Main Line franchise competition cancelled" headline, from DfT^» (Department for Transport - about).   For our own area:

The Transport Secretary has also:

Ordered two independent reviews to be undertaken urgently: the first into what went wrong with the West Coast competition and the lessons to be learned, the second into the wider DfT rail franchise programme, both overseen by leading business figures;

Asked officials to examine the options for the operation of the West Coast service after December 9, taking into account procurement and competition law;

Paused all the other outstanding franchise competitions (Great Western, Essex Thameside and Thameslink) pending the independent reviews which are designed to ensure future competitions are robust and deliver best value for passengers and tax payers.

[JayMac]

First Group are taking a massive financial hit on the markets this morning. In just the first hour of trading their share price has fallen by over 18%.

It is being reported on BBC^» (British Broadcasting Corporation - home page) Breakfast that First Group are considering legal action against the Department for Transport.

[eightf48544]

The Trout's conspiracy theory is very interesting but I tend to favour the cock-up theory of history. It may strart out as a conspiracy but whowever starts it is too stupid to carry it out proporley and it becomes a cock-up.

This seems to be cock-up on a gigantic scale.

I caught a bit I think saying DaFT^» (Department for Transport - critical sounding abbreviation I discourage - about) would refund the bidders costs that would be ^40 million at least at ^10 million a bid.Definitely not a valid answer to the Wolmar question

[Western Enterprise]

First Group are taking a massive financial hit on the markets this morning. In just the first hour of trading their share price has fallen by over 18%.

Now down nearly 50p or 20% this morning...
A screaming buy at that price with a divi yield at 10%.
But, Not for widows and orphans though.......

[TonyK]

As cock-ups go, this is an absolute monster. Ed (or is it David?) Miliband must be sad that it happened the day after his keynote rant. First must be furious, having seen their share price plummet. The Bearded One will be hugely satisfied, and the whole shambles will highlight again the total inadequacies of the privatisation model - not that the nationalised model didn't have its own inadequacies.

Had this can of worms not been opened by Sir Richard, then come 9 December, the same service using the same train driven by the same driver would have left the same station heading for the same destination at the same time for the same price, probably still sporting the same livery. It's hardly a paradigm of free enterprise, is it? What the government does is to offer the timetable to the highest bidder, and provide the kit through the fallacious vehicle of the ROSCOs^» (Rolling Stock Owning Company - about). This transfers some of the financial risk from the government (or public) to shareholders (or public), with the rewards to be paid for by passengers (or public) or taxpayers (or.. yes, you guessed). First said in their bid they would introduce new electric trains on WCML^▸ (West Coast Main Line), meaning that they would take advantage of the IEP^▸ (Intercity Express Program / Project.) programme instituted by the government, just like any other train company would. There will be some winners (or lawyers) from this fiasco.

Civil servants have been suspended because of this almighty cock-up. I will happily swap jobs with them, because the sanction will ultimately be early retirement, because the core of the problem lies with ministers. Millions of public pounds have been wasted. This won't stop there, and I think the government will be in for a rough time, unless the Liberal Democrats can be blamed. Light may well be shone on other areas of weakness in the rail process. At least, though, the trains will still be running.

[SandTEngineer]

......this bit from the DfT^» (Department for Transport - about) press release really gets me:

DfT permanent secretary Philip Rutnam said:

^The errors exposed by our investigation are deeply concerning. They show a lack of good process and a lack of proper quality assurance."

^I am determined to identify exactly what went wrong and why, and to put these things right so that we never find ourselves in this position again.^

What happened to old fashioned accountability?  Its his department is it not?  Well then this is British government at its best

Warning - Cynic Alert: I see our PM has not said anything yet   I thought this country was broke........well its only ^40m I suppose.

[TonyK]

A friend of mine thinks that all conspiracy theories are started by Barak O'Bama, to hide his true Irish roots.

Thanks to the wonderful work of all those brave men and women at FGW^▸ (First Great Western), however, I will soon be rejoined by my beloved Mrs FTN, who has been away for a few days, unconnected to any matrimonial disharmony. Just time to tidy up, I think.

[TonyK]

No-one else has spotted this one yet. For the minister to have made the wrong decision based on the wrong interpretation of First's figures by a civil servant, First's figures must have been wrong in the First place. That may come to haunt them in the future, possibly for a very long time.

You heard it here First.

[TonyK]

I've probably posted it before. But the Montpieller - Lorca service runs under wires from Montpieller to Alicante hauled by an Electric Loco.

There's only one "L" in Montpelier, and it stops at Stapleton Road next.



Montpellier Railway Station, Bristol by brizzle born and bred, on Flickr

[broadgage]

When it was announced that First had won the franchise, did not Virgin afterwards state what wonderful improvements would have taken place if only they had retained it ?
New through services to places lacking same at present
Longer or extra trains etc.

Some people suggested that these claims were somewhat inflated.

Now that the process is starting again, IF Virgin succeed, will they have have to fullfill these promises ?

[IndustryInsider]

Now that the process is starting again, IF Virgin succeed, will they have have to fullfill these promises ?

God knows!  What an absolute mess!  The repercussions of this will be felt for years.  A very black day for the railway industry's credibility - not (directly at least) caused by any of the TOCs^▸ (Train Operating Company), which those that support renationalisation will quite rightly jump on.

[Zoe]

Now that the process is starting again, IF Virgin succeed, will they have have to fullfill these promises ?

If the entire process is declared null and void then there wouldn't be any commitment for Virgin to keep promises they made this time as it would be a completely new franchise competition.

[Tim]

No-one else has spotted this one yet. For the minister to have made the wrong decision based on the wrong interpretation of First's figures by a civil servant, First's figures must have been wrong in the First place. That may come to haunt them in the future, possibly for a very long time.

You heard it here First.

IIUIC, First's figures were right, but the DaFT^» (Department for Transport - critical sounding abbreviation I discourage - about) idiots failed to take into account inflation and risk.  First were offering more premium but Virgin were offering more in the early years.  DafT failed to take into account that a pound next year is worth more than a pound in 10 years time both because of inflation and the increased risk that I will have scarpered in 10 year's time.

You couldn't make it up though.  I wonder if First might end up sueing the Government?  The owning groups have up to now been very reluctant to upset DfT^» (Department for Transport - about).  Let's hope that Branson has well and truly broken that taboo and they will all feel able to speak out on such matters in the future (on IEP^▸ (Intercity Express Program / Project.) for example?)