East Coast rail franchise to go back into Government control as Virgin Trains fails to profit from it.
Stagecoach and Virgin Trains have been stripped of the East Coast rail franchise after it became apparent that they could not run the service at a profit.
In what smacks of yet another case of the DfT not doing their sums when awarding franchises, this one in particular seems to be the Government’s Achilles Heal.
It was not too far back in recent memory that the DfT were roundly embarassed by Sir Richard Branson, when he jumped up and down about First Group over-stating the profits they could make from the West Coast franchise. This in turn mean’t that First Group wouldn’t have been able to achieve the returns it had promised to the Government.
His legendary media work forced the Government into a u-turn, and his Virgin Trains is still running the show on that line.
It might come as a suprise then, that on the East Coast, the very same thing that Branson warned with a First Group award on the West Coast, has happened to him on the East Coast.. A consortium, including Branson’s Virgin Trains, over-stated the profits they could make and the returns they could deliver to the exchequer, and guess what? They’ve handed the keys back.
Cue the DfT with its “Operator of Last Resort” – in order words, itself, to run the trains until it can decide what it will do about it.
What About the Hypocrisy?
Well, that goes unpunished and is not mentioned anywhere in the press. Branson and his partner’s in rail-crime continue to operate the West Coast services as if nothing is going on over on the East.
Chris Grayling, the minister in charge of the railways has even gone so far as to say in a Parliamentary statement, that Virgin Trains and Stagecoach remain fit and proper operators of rail services.
It is fair to say then that the systematic hypocracy runs deep in this instance.
1) The DfT didn’t learn their lessons from the West Coast debacle. That’s to say, that they fell for a flawed bid again. Obviously the number of zero’s written on a piece of paper is all it takes to win a rail franchise.
2) Virgin Trains, and Richard Branson especially, should know better when it comes to furore they caused over the West Coast debacle. To then go and do it themselves on the West Coast is surely bordering on criminal. It certainly at best makes them NOT a fit and proper operator.