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Virgin Trains offers to run West Coast 'for free'

26 August 2012 Last updated at 15:25 GMT BBC

Sir Richard Branson has offered to run the West Coast Mainline "for free" to give Parliament time to review the £10bn franchise's award to FirstGroup.

He said Virgin Trains and Stagecoach would run it on a not-for-profit basis after December - when they are due to hand over the franchise - if more time was needed for a review.

More than 100,000 people have signed an online petition against the decision.

FirstGroup said it would bring in key improvements for passengers.

In its bid, FirstGroup said it would introduce better wi-fi and food, more frequent trains and more seats, and would cut standard fares by 15%.

The firm said it would introduce 11 new 125mph six-car electric trains on the Birmingham-to-Glasgow route and provide more direct services between destinations.

'Almost certain bankruptcy'

However, the Virgin boss claimed promises made by FirstGroup in its successful bid were unrealistic and would lead to his rival's "almost certain bankruptcy".

In an opinion piece in the Daily Telegraph, Sir Richard described the government's decision as "outrageous, unjust and simply wrong".

His campaign to have the decision reviewed has been backed by businessman Lord Sugar, TV chef Jamie Oliver and the double Olympic gold medallist Mo Farah.

The government is due to sign the 13-year contract with FirstGroup on Tuesday, following the Department for Transport's decision earlier this month.

Louise Ellman, who chairs the House of Commons transport committee, has written to Transport Secretary Justine Greening asking her to delay signing the contract.

But a Department for Transport (DfT) spokesman said: "We note the offer that one of the bidders appears to have made via the press.

"However, the winning bidder was decided by a fair and established process and no reason has been advanced to convince DfT not to sign the agreement."

Virgin has run the franchise since 1997, during which time passenger numbers have doubled, but has been told that its tenure will end on 9 December.

Sir Richard said that if reviewing the decision meant the December deadline had to be postponed, his company and Stagecoach would be willing to continue operating the railway lines while donating any profits to charity.

'Fare cuts'

The government says FirstGroup's new trains should add a further 12,000 seats a day on West Coast routes from 2016.

FirstGroup said it already ran an award-winning service and was looking forward to welcoming new passengers.

"As a result of our plans, customers travelling with us will use faster brand new trains with more seats, serving more destinations than the current service," a spokesman said.

"There will be improved wi-fi, better catering, refurbished stations and importantly we'll be cutting standard anytime fares by 15% on average."

About 31 million passengers travel on the West Coast Mainline every year.

Sir Richard Branson offers to temporarily run the West Coast Main Line for free

PETER CRIPPS SUNDAY 26 AUGUST 2012
Independent

Sir Richard Branson today offered to run the West Coast Main Line for free to allow Parliament time to scrutinise an "outrageous" decision to award the franchise to rival FirstGroup.

The entrepreneur, who has claimed that FirstGroup's bid will lead to "almost certain bankruptcy", made a last-ditch appeal to the Government to delay signing the 13-year contract on Tuesday.

He said Virgin Trains and Stagecoach would operate the joint venture on a not-for-profit basis or donate profits to charity if the franchise needed to be extended beyond December for a few months to allow Parliament to investigate the decision.

Sir Richard is also pressing for an independent audit of the Department for Transport's decision over the £10 billion deal.

His plea comes after Louise Ellman, the chairman of the House of Commons Transport Committee, wrote to Transport Secretary Justine Greening asking her to hold off signing the final contract, saying that "important issues" had been raised.

And more than 100,000 members of the public have signed an online petition against the decision, in a campaign supported by double Olympic champion Mo Farah, Apprentice star Lord Sugar and celebrity chef Jamie Oliver.

In an opinion piece for the Sunday Telegraph Sir Richard said: "It is far better for MPs to have the chance to debate the issues, and question ministers on the detail before the decision is finalised.

"To assist in this process, there should be an independent audit of the DfT decision to ensure it has been based on correct criteria and reliable forecasting of customer numbers, revenue and payments to Government.

"We must ensure that this crucial decision is taken with all the facts correctly assessed and understood."

Sir Richard accepted that he has a "vested interest" but added: "City analysts, politicians, media commentators and - most importantly - our many loyal customers have seized on this decision as outrageous, unjust and simply wrong."

Virgin has operated the West Coast line since 1997 and has more than doubled annual passenger numbers over 15 years.

FirstGroup claims it will deliver better value for taxpayers. It plans major improvements to the InterCity West Coast franchise to enhance the customer experience, including improved wifi and catering, as well as additional services and more seats and reducing standard anytime fares by 15% on average.

Richard Branson makes last-ditch bid to keep west coast rail franchise

Virgin Trains offers to run service on not-for-profit basis in bid to overturn award of contract to FirstGroup

Gwyn Topham, transport correspondent
guardian.co.uk, Sunday 26 August 2012 18.52 BST

In a last-ditch attempt to overturn the award of the west coast rail franchise to FirstGroup, Virgin Trains co-owner Sir Richard Branson has offered to run the service "for free" to allow time for parliamentary scrutiny of the decision.

Virgin also renewed its threat to seek a judicial review before the deadline of Tuesday night when contracts are due to be signed by the Department for Transport (DfT), although it hopes pressure from within the Conservative party may sway the transport secretary, Justine Greening, where Labour voices and public petitioning have failed.

The DfT said it had "no reason" to delay signing off the franchise, which will give FirstGroup, Britain's largest rail operator, the right to run services between London and cities north to Glasgow until at least 2026. FirstGroup bid £5.5bn, according to the DfT, £700m more than Virgin, the incumbent and closest shortlisted bidder.

The actual payments will top £10bn after inflation, more than £1bn above Virgin's offer. Branson and several City analysts have questioned whether the level of FirstGroup's bid is sustainable or if risks a repeat of high-bidding franchisees not seeing out their contracts.

Branson on Sunday called for an independent audit of the decision, particularly to check the forecasts of customer numbers, revenue and payments offered to the government. Writing in the Sunday Telegraph, he said: "If this process means extending the current franchise beyond December for a few months, I and my partners at Stagecoach would happily run the extended franchise on a not-for-profit basis, or donate profits to charity. We must ensure that this crucial decision is taken with all the facts correctly assessed and understood."

A DfT spokesman said: "We note the offer that one of the bidders appears to have made via the press. However, the winning bidder was decided by a fair and established process and no reason has been advanced to convince DfT not to sign the agreement."

A Virgin source said it had been making its case at "all levels" of the Conservative party, and MPs were making representations to Greening. The source said: "When we lost CrossCountry to Arriva in 2007 we lost fair and square, by a narrow margin. This is a different ball game altogether, a margin verging on 15% with all the money coming in at the end."

The offer to run it for free meant that there was "no rush, and no need for it to be signed off in August. Let it be properly scrutinised by parliament and we'll abide by the decision."

An online petition started by a Scottish rail passenger calling on the DfT to reconsider has garnered more than 128,000 signatures, a number that all but guarantees a parliamentary debate, although it is unlikely to be held until long after the contract is signed. The transport select committee is planning to question Greening soon over the agreement after its own chair's attempts to delay the award to allow scrutiny were rebuffed.

The Virgin source said: "If this had just been Richard ranting, it would have died off by now. But these are not acolytes – these are people looking independently saying, we don't believe these figures."

FirstGroup is confident the franchise will be formalised by Wednesday and views Branson's reaction as confirmation that the railway line is lucrative enough to support the high premium payments it has promised to pay the government. A source close to the company said: "Our deal represented the best deal for the British taxpayer. We don't have a history of mobilising celebrities, but we do have history of running successful railways."

He said Branson's offer to keep running the line for a short period was "neither practical nor feasible" and added: "We fully expect the process to be completed this week with the signing of the franchise and we look forward to running west coast trains on December 9."

Labour calls for West Coast Mainline franchise review

Virgin has doubled passenger numbers since it took on the franchise in 1997

27 August 2012 Last updated at 01:56 GMT BBC

Labour is urging ministers to delay signing a new West Coast Mainline contract until Parliament returns.

The party says MPs must have the chance to consider the decision to take the franchise from Virgin Trains and give it to FirstGroup for the next 13 years.

FirstGroup says it will bring in key improvements for passengers but critics fear it will not be able to afford the £5.5bn it is paying for the franchise.

The Department for Transport said it had "no reason" to delay the signing.

A spokesman indicated that the agreement was set to be signed on Tuesday despite Virgin's Sir Richard Branson offering on Sunday to run the service "for free" while a review was carried out.

The spokesman said: "We note the offer that one of the bidders appears to have made via the press.

"However, the winning bidder was decided by a fair and established process and no reason has been advanced to convince DfT not to sign the agreement."

Fierce lobbying

Aberdeen-based FirstGroup already operates a number of rail routes including Great Western and ScotRail.

The company, under the name First West Coast Limited, will take over the franchise from 9 December and is due to to operate the service until 2026.

The West Coast Mainline route serves 31 million passengers travelling between London, the West Midlands, the North West, North Wales and the central belt of Scotland.

Virgin has run the franchise since 1997, during which time passenger numbers have doubled.

FirstGroup has promised to introduce better wi-fi and food, more frequent trains and more seats, and to cut standard fares by 15%.

The firm said it would introduce 11 new 125mph six-car electric trains on the Birmingham to Glasgow route and provide more direct services between destinations.

But BBC deputy political editor James Landale said there was a fierce lobbying campaign, in the final hours before pen is put to paper, to put the decision on hold.

More than 100,000 people have signed an online petition calling for the decision to be reconsidered.

Labour's Maria Eagle, the shadow transport secretary, is urging the government to put the contract on hold until MPs return and have a chance to consider the deal.

And Labour's Louise Ellman, who chairs the House of Commons transport committee, has written to Transport Secretary Justine Greening asking her to delay signing the contract.

On Sunday, Sir Richard said that if reviewing the decision meant the December deadline had to be postponed, his company and Stagecoach would be willing to continue operating the railway lines while donating any profits to charity.

Richard Branson to take legal action over decision to strip Virgin of West Coast mainline contract

Richard Branson is to take legal action over the Government’s decision to award the West Coast mainline contract to another company.

Telegraph
3:51PM BST 28 Aug 2012

Richard Branson is to take legal action over the Government’s decision to award the West Coast mainline contract to another company.

Virgin Trains lost the franchise to FirstGroup earlier this month after running the service for 15 years.

The company said it was taking legal action because it believed the decision had “ignored the substantial risks” of FirstGroup's bid.

Mr Branson had previously called on ministers to delay a decision on the 13-year franchise until Parliament returns from the summer recess so it can be debated.

He had even offered to run the service on a non-profit basis until MPs returned.

He reacted angrily to the decision, branding the bidding process "insane" and threatening to end all involvement with the railways.

But earlier today Transport Secretary Justine Greening said the Government would put pen to paper soon – expected tomorrow.

She claimed that if Virgin had won the bid it would have "been perfectly happy with the process".

In the past few days, Labour and members of the House of Commons Transport Committee said they hoped the final signing could be deferred until the matter could be debated in Parliament.

Sir Richard has expressed concerns that FirstGroup would not be able to live up to its financial and service-providing targets for West Coast.

Today, Sir Richard said: "We had hoped that Parliament or an external review would be able to scrutinise this badly-flawed process before the franchise was signed."

In a statement, Virgin added: "Virgin Trains Limited (VTL) has today commenced court proceedings in respect of the decision to award the West Coast Main Line franchise to FirstGroup.

"We have tried for three weeks to get clarity over the DfT's decision and to have a number of key questions answered. On each occasion we have been refused information.

"We are left with no choice but to commence court proceedings as we believe the procurement process has ignored the substantial risks to taxpayers and customers of delivering FirstGroup's bid over the course of the franchise."

Virgin went on: "In addition it (the process) has ignored the DfT's own assessment that VTL's bid was more deliverable and a lower risk. We question whether FirstGroup's bid has been correctly risk adjusted by the department given all of its supposed incremental value is delivered after 2022.

"The current process is geared to selecting the highest risk bid and needs to be independently audited to prevent a repeat of former franchise failures."

Sir Richard said hopes of a Parliamentary or external review would be denied "if the DfT follows through with its determination to rush through the process before Parliament returns next week".

He added that signing off the franchise now "ignores the wishes of more than 150,000 people who signed the Downing Street e-petition in 10 days, the Labour Opposition, two important Commons committees and many backbench Conservative MPs who wanted a debate before the decision is taken, not a post-mortem afterwards".

Sir Richard said: "We have not taken this decision lightly, but it is the only course now available to try to unravel this sorry process."

Responding to news of the legal challenge, FirstGroup said: "We have every confidence in the DfT's process which is rigorous, detailed and fair and in which bids are thoroughly tested. There has been no complaint about the process, which was carefully described in advance, until Virgin Rail Group had lost commercially.

"Our plans for the new InterCity West Coast franchise include faster journeys, new trains, more seats and more direct services from London than currently on offer.

"There will be improved wifi, better catering, refurbished stations and standard anytime fares will be reduced by 15% on average within the first two years. We look forward to welcoming passengers to their new and exciting InterCity West Coast service in December and creating a better railway for all.

"Our focus is to ensure a smooth transition with continuity for staff and passengers alike. We want to get on with delivering the many benefits and improvements we are offering without delay or disruption. We will continue to prepare for a successful start up of the new franchise on December 9."

Virgin Trains launches West Coast Mainline court action

Breaking Travel News 28/08/12

Virgin Trains has launched formal legal proceedings following the decision to award the West Coast Main Line franchise to FirstGroup.

The move follows earlier confirmation from the government the move would go ahead before parliament returns from recess.

”We have tried for three weeks to get clarity over the department for transport’s decision and to have a number of key questions answered,” read a statement from the train operator.

“On each occasion we have been refused information.

”We are left with no choice but to commence court proceedings as we believe the procurement process has ignored the substantial risks to taxpayers and customers of delivering FirstGroup’s bid over the course of the franchise.”

Virgin argues the department for transport has ignored its own assessment its bid was more deliverable and a lower risk.

“We question whether FirstGroup’s bid has been correctly risk adjusted by the department given all of its supposed incremental value is delivered after 2022,” added Virgin.

”The current process is geared to selecting the highest risk bid and needs to be independently audited to prevent a repeat of former franchise failures.”

Sir Richard Branson, Founder Virgin Group, added: “We had hoped that Parliament or an external review would be able to scrutinise this badly flawed process before the franchise was signed.

”However that opportunity would be denied if the DfT follows through with its determination to rush through the process before parliament returns next week.

“That ignores the wishes of more than 150,000 people who signed the Downing St e-petition in ten days, the Labour Opposition, two important commons committees and many backbench conservative MPs who wanted a debate before the decision is taken, not a post-mortem afterwards.

“We have not taken this decision lightly, but it is the only course now available to try to unravel this sorry process.”

Virgin Trains takes West Coast Main Line court action

28 August 2012 Last updated at 19:14 GMT BBC

Virgin Trains has started court proceedings over the government's decision to award a new franchise to rival transport company FirstGroup.

Virgin has run the West Coast Main Line since 1997, but lost to FirstGroup, prompting it to demand a review.

Labour had also urged the government to defer signing the contract so that MPs could examine it.

Transport Secretary Justine Greening earlier said there would be no delay but Virgin hopes for a pause.

It is unclear if or for how long the legal action would halt the process, with the contract due to be signed on Wednesday.

Virgin's legal challenge is an application for a judicial review of the decision to award FirstGroup the contract, and has lodged papers at the High Court in London.

'Maths wrong'

Sir Richard Branson, the founder of Virgin Group, said: "In the bid process the one thing we do know is our bid was voted far more deliverable than FirstGroup's.

"All we are saying is that these same civil servants got their maths wrong with National Express and GNER, we're absolutely convinced they've got their maths wrong with FirstGroup.

"Rather than give up the fight as we did on the East Coast Main Line, we're going to fight, and if at the end we're proven wrong we'll bow out gracefully."

Mrs Greening said she was disappointed by Virgin's decision to start legal action.

"We will defend the robustness of the process. It's a process that Virgin themselves have been involved in for the last 15 months and have raised no concerns about until the point it became clear that they had lost this bid," she said.

"We have a process that all the parties bought in to, one of them that hasn't won out on the bid has chosen to challenge it."

'Every confidence'

Virgin said it was going to the High Court in the hope that the process would be declared flawed.

However, FirstGroup said in response: "We have every confidence in the DfT's [Department for Transport's] process which is rigorous, detailed and fair and in which bids are thoroughly tested.

"There has been no complaint about the process, which was carefully described in advance, until Virgin Rail Group had lost commercially."

FirstGroup said it wanted to proceed "without delay or disruption" and would continue to prepare to start running the franchise on 9 December this year.

Virgin Trains said a clause in the invitation to tender for the franchise stated that the DfT should not sign the contract if a legal challenge was received.

In a statement, Virgin said it had tried to get clarity over the DfT's decision, but its questions had been unanswered for three weeks.

"We are left with no choice but to commence court proceedings as we believe the procurement process has ignored the substantial risks to taxpayers and customers of delivering FirstGroup's bid over the course of the franchise."

It added: "The current process is geared to selecting the highest-risk bid and needs to be independently audited to prevent a repeat of former franchise failures."

'Bottom line' decision

More than 150,000 people have signed an online petition calling for the decision to be reconsidered.

In a letter to Mrs Greening, shadow transport secretary Maria Eagle said FirstGroup's bid was "significantly higher than any other bid" and the decision seemed to be "almost exclusively a 'bottom line' one, driven by a particularly high pledge of payments to government".

FirstGroup is due to take over the franchise, under the name First West Coast Limited, until 2026.

The Aberdeen-based company already operates a number of rail routes, including Great Western and ScotRail.

The West Coast Main Line route serves 31 million passengers travelling between London, the West Midlands, the North West, North Wales and the central belt of Scotland.

Passenger numbers have doubled since Virgin started running the franchise.

FirstGroup has said it would introduce 11 new 125mph six-car electric trains on the Birmingham to Glasgow route and provide more direct services between destinations, as well as introduce improved wi-fi and food.

West Coast Main Line

- Thirteen-year contract, beginning in December 2012
- FirstGroup's successful bid worth £5.5bn
- The company will cut standard fares by 15%
- Promises a further 12,000 seats a day from 2016
- Carries about 31 million passengers every year
- Virgin ran the franchise from 1997

Rail and air transport policy left in chaos

Virgin blocks rail franchise award going to FirstGroup as backbenchers rebel over Heathrow third runway

Dan Milmo, Gwyn Topham and Nicholas Watt
guardian.co.uk, Tuesday 28 August 2012 18.57 BST

Government transport policy has been thrown into chaos after Sir Richard Branson blocked ministers from stripping Virgin Trains of the west coast rail franchise and a row over Heathrow expansion saw Nick Clegg and David Cameron under attack from senior backbenchers asking for a U-turn on a third runway.

The Virgin tycoon prevented FirstGroup from taking over the London-Glasgow route with a last-ditch application for a judicial review, forcing the Department for Transport (DfT) to postpone a contract signing due on Wednesday morning. Justine Greening, the transport secretary, said the government would defend the bidding process and accused Virgin of double standards. "Had they won this bid they would have thought the process was working just fine," she said.

The DfT said the legal row would not affect the day-to-day operation of the west coast route. The high court is expected to decide if there are grounds for a review within two weeks and a formal review could take up to three months, right up to 9 December when FirstGroup is due to operate its first west coast service.

Branson's intervention crowned a day that saw one of the Conservative party's flagship election pledges put under further pressure by its own side, when the former minister and current chair of the energy select committee, Tim Yeo, warned that David Cameron would consign Britain to insignificance if he did not reverse a ban on a third runway at Heathrow. Demanding a U-turn, Yeo asked the prime minister: "Are you a man or a mouse?"

Yeo was slapped down by Greening, Number 10 and then the deputy prime minister, who also ruled out abandoning a policy enshrined in the coalition agreement. He did, however, suggest an alternative overhaul of London airports.

Instead of changing tack on Heathrow, Clegg said, hundreds of flights should be moved to London's three other airports as a way of preserving Heathrow's hub status and avoiding the need for a new runway.

In a Guardian interview, he insisted that the coalition would stand by its commitment not to build a third runway at Heathrow. He also denied ministers were "sticking our heads in the sand" to calls from business groups warning that Britain is losing business as new routes open up to China from continental European airports.

Clegg said: "We are not going to give the go-ahead to a third runway at Heathrow. But of course I accept, everybody accepts, that the issue of the hub status of Britain's airport capacity is a really important one for our economy."

Citing London mayor Boris Johnson's calls for a new airport in the Thames estuary, he added: "We are kind of lurching from one instant solution to another. One moment it is Boris Island, now it is a third runway. What we need to do as a government is sensibly say we are going to stick to our coalition agreement, but we are not sticking our heads in the sand."

The deputy prime minister said he personally favoured freeing up capacity from Heathrow by moving hundreds of flights to Gatwick, Luton and Stansted airports.

"There are a lot of flights going into Heathrow that aren't necessary for its hub status. If you are being logical about this you would shift a lot of the current flights out of Heathrow to the other three airports, freeing up that hub capacity for Heathrow."

Greening had earlier admitted that it would be difficult to stay in her job if the Heathrow policy was scrapped, having led a constituency campaign in her Putney constituency against expansion. The transport secretary has been mooted to be facing demotion in the forthcoming cabinet reshuffle, in order for the government to stage a U-turn on a third runway. But No 10's restating of Cameron's insistence that he will not bow to pressure over Heathrow appears to bolster her chances of survival.

After a summer of growing backbench dismay at the coalition's flagging fortunes, ministers were startled by the tone of Tuesday's "man or mouse" challenge. Yeo said he had changed his own mind thanks to quieter and more fuel efficient jets.

The South Suffolk MP chose the Daily Telegraph, one of many conservative City and big business interests dismayed by the joint 2010 position adopted in the coalition agreement, in which to set down his less-than-coded challenge. Greening insisted that a third runway would not even provide a brief respite from the south-east's long-term airport capacity problems and said her forthcoming consultation would forge a new consensus for action. Labour, which reversed its own support for the third runway, also backs the consultation.

Johnson, who had been a siren voice within the Conservative party over airport capacity until the Heathrow reversal campaign gathered momentum, urged Cameron to come up with a definitive answer to the capacity issue. "It is plain that the argument over aviation capacity is not going to vanish and he can't long grass this. It is necessary to come up with an answer."

West Coast Main Line First Group deal put on hold

3 September 2012 Last updated at 15:44 GMT BBC

The deal to hand the West Coast Main Line rail franchise to First Group is to be delayed following a legal challenge by current operator Virgin.

Virgin launched the challenge last week after losing its attempt to continue operating the route.

Ministers were expected to sign the deal with First Group several days ago.

But they have confirmed due to the legal challenge the contract has not been signed and "the competition remains live".

Virgin has run the West Coast Main Line since 1997, but lost out to FirstGroup, prompting it to demand a review.

Labour had also urged the government to defer signing the contract so that MPs could examine it.

'Significant improvements'

And more than 165,000 people have signed an online petition calling for the decision to be reconsidered.

In a written ministerial statement transport minister Theresa Villiers said: "As a result of a legal challenge, which the government intends to defend robustly, we have not yet signed the contract with First West Coast, and consequently the competition remains live."

But she insisted "the commitments in First West Coast's bid represent significant improvements for passengers and will provide a good return for the taxpayer."

Virgin has made an application for a judicial review of the decision to award FirstGroup the contract, and has lodged papers at the High Court in London.

FirstGroup has said it wants to proceed "without delay or disruption" and would continue to prepare to start running the franchise on 9 December this year.

The franchise, to be run under the name First West Coast Limited, would run until 2026.

The Aberdeen-based company already operates a number of rail routes, including Great Western and ScotRail.

The West Coast Main Line route serves 31 million passengers a year travelling between London, the West Midlands, the North West, North Wales and the central belt of Scotland.

Passenger numbers have doubled since Virgin started running the franchise.

FirstGroup has said it would introduce 11 new 125mph six-car electric trains on the Birmingham to Glasgow route and provide more direct services between destinations, as well as introduce improved wi-fi and food.


Government puts West Coast signing on hold

Posted 3rd September 2012 | Railnews

THE DEPARTMENT FOR TRANSPORT has admitted that it cannot sign off the new Intercity West Coast franchise with FirstGroup because Virgin Trains has started High Court action. Until now ministers had insisted that signatures were imminent.

In a statement to the House of Commons, rail minister Theresa Villiers said: "As a result of a legal challenge, which the government intends to defend robustly, we have not yet signed the contract with First West Coast, and consequently the competition remains live. I cannot give the full commercial details of the winning bid, or indeed of the other bids.

"Nor is it usual or appropriate – once litigation proceedings have commenced – for the Government to comment on the detail of that, other than to say that our legal advisers are fully engaged in addressing and responding to those proceedings.

"I will continue to keep the House updated, subject to the constraints of legal or commercial privilege."

The suspension of the completion must place doubt over FirstGroup's position, and in particular whether it can still take over on 9 December.

Neither First nor Virgin have commented yet following the DfT announcement, but they have become embroiled in a war of words over which contract would be best for the country.

Virgin has also vigorously contested claims that it only starting questioning the DfT's handling of franchise competitions recently. The chief executive of Virgin Trains, Tony Collins, said that his company had been expressing its concerns about the way bids are evaluated for the past 'two or three years'.

No date has yet been set for the first hearing in the High Court, but it is expected to be within the next week or two. Much will depend on that hearing, after which the court will decide if a full judicial review is justified.

West Coast rail franchise to be nationalised - paper

LONDON | Sun Sep 9, 2012 12:49pm BST

(Reuters) - The British government is preparing to nationalise Virgin Trains' West Coast railway train operating franchise following its attempts to delay the handover of the network to rival operator First Group which won the franchise renewal bid, the Sunday Times newspaper said.

Virgin's campaign for a judicial review of the government's decision to award the franchise to First Group has delayed the signing of the contract and could put back indefinitely the handover, which is due to take place on December 9.

Ministers are now preparing to transfer the service to state-owned Directly Operated Railways, the paper said, quoting the Department for Transport as saying it was "looking at our responsibilities under section 30 of the Railways Act and it is only prudent to increase our focus on contingency planning".

The Department for Transport declined to comment further.

Virgin Trains, a joint venture of entrepreneur Richard Branson's Virgin Group and trains and buses operator Stagecoach, could not be reached for comment.

(Reporting by Laurence Fletcher; Editing by Greg Mahlich)

Two more pieces in the Grauniad today, at http://www.guardian.co.uk/uk/2012/sep/1 ... tgroup-bid and http://www.guardian.co.uk/business/2012 ... firstgroup respectively:

Richard Branson denounces DfT for accepting FirstGroup rail bid

Virgin Rail head claims department is being taken for a ride by rival's 'preposterous' sum for lucrative west coast rail franchise...

Tycoon Branson rails a lot and steams up over rail firm's number crunching

FirstGroup CEO Tim O'Toole stokes up confident defence of his winning franchise bid for the west coast line...

Followed by the Telegraph, Independent and BBC, at http://www.telegraph.co.uk/finance/news ... facts.html, http://www.independent.co.uk/news/uk/ho ... 22124.html and http://www.bbc.co.uk/news/uk-politics-19548012? respectively:

FirstGroup: Richard Branson's claims don't 'square with the facts'

FirstGroup has moved to quash Sir Richard Branson’s efforts to cast himself as the defender of Britain’s railways, warning the entrepreneur’s image as the “voice of sobriety” doesn’t “square with the facts”...

The rail franchise system is flawed, says Virgin boss Sir Richard Branson

The Department for Transport (DfT) did not follow its own rules over the West Coast main line franchise bidding process, Virgin boss Sir Richard Branson told MPs today...

Richard Branson claims Virgin's West Coast rail loss 'bad for UK'

Virgin boss Sir Richard Branson: "The franchising system is flawed, and the rules and regulations should be rewritten"...

18 September 2012 Last updated at 00:50 GMT BBC

'Dick Turpin' rail firms criticised by MP

An MP has compared some train companies to latter-day "Dick Turpins" in a debate on the future of the West Coast Mainline rail franchise.

Rosie Cooper, Labour MP for West Lancashire, said some firms had won contracts on a "bogus premise" and then "taken their profits and scarpered".

The award of the West Coast contract to FirstGroup has been halted pending a legal challenge by rivals Virgin.

FirstGroup has rejected claims its £5.2bn bid is not financially viable.

Monday's parliamentary debate was triggered by an e-petition urging the government to reconsider the West Coast decision - signed by more than 170,000 people.

FirstGroup won the 15-year contract after making the highest bid but Virgin - the current operator - has claimed the contract process was faulty and launched a judicial review to try to invalidate the decision.

'Best deal'

Opening the backbench debate, Ms Cooper said she did not especially care which company ran a specific service and her priority was to get the "best deal" for rail passengers and taxpayers.

"Recent franchise experiences have shown the highest bids, the riskiest bids, are not necessarily sustainable bids," she told MPs.

"In recent years, a number of train operators have handed back the keys to the government on franchises such as the East Coast Mainline."

Invoking the name of the infamous 18th Century highway robber Dick Turpin, Ms Cooper questioned the past conduct of some rail operators.

"I believe MPs on all sides want to be sure this is not going to happen again and taxpayers have assurance they will not be held to ransom by Dick Turpin train operators asking them to stand and deliver - having secured the contract on a bogus premise, taken their profits and scarpered when it is time to deliver the promised high return."

Asked by Conservative MP Daniel Kawczynski to justify her remark, she stressed: "I think there are a lot of Dick Turpin-type figures about."

'Genuine'

Iain Stewart, a Conservative member of the Commons transport select committee, said the bid process was "rigorous" and he believed First Group's ambitions were "genuine".

"I don't believe First Group would be making this bid if it did not believe it could deliver on it," he said.

"I actually think it is healthy we have this high level of ambition and competition. That is to the benefit of all who use the railway."

For Labour, shadow transport secretary Maria Eagle said MPs should not be "siding with any particular company" but had a right to question whether "history was repeating itself" in terms of operators being unable to see through their franchises.

Many industry professionals, she claimed, were "dubious" about whether FirstGroup's bid was "viable" in terms of passenger growth and contract repayments, adding that it was "not unknown" for the Department for Transport to come under pressure from the Treasury to accept the highest bid.

Transport Minister Stephen Hammond said the government was "confident it had taken the right decision".

"The Department for Transport believes the winning bid is deliverable, provides value for money for the passenger and taxpayer and capitalises on the £9bn investment already being made on the West Coast mainline."

Virgin Trains set for Christmas windfall despite West Coast Mainline row

Virgin Trains is heading for a yuletide windfall even though it is expected to lose the franchise to operate the West Coast Main Line.

By David Millward, Transport Editor 5:27PM BST 24 Sep 2012 Telegraph

The company will rake in cash for the busy Christmas period despite the fact that the trains will – depending on the outcome of its legal challenge – be operated by either First Group or the Government-run company Directly Operated Railways.

Tickets for the Christmas holidays go on sale in around a fortnight's time, covering a period when trains will be packed with people visiting family and friends...