Latest Rail News

24.08.18

Public sector bidders will be allowed to compete for ScotRail franchise

Public-sector bidders will be allowed to compete for the next ScotRail franchise in order to ensure the public and private sectors have a fair and equal access to contracts, ministers have confirmed.

Michael Matheson, Cabinet secretary for transport, infrastructure and connectivity, said the Scottish Government’s “consistent view over many years” is that there must be a level playing field for interesting parties in bidding for franchises.

“We secured the right for a public sector operator to bid for a rail franchise in Scotland, after being denied by previous UK Governments,” he commented.

“Identifying a public sector body to make a bid has not been easy. It was vital to consider a range of scenarios as we want to strengthen competition and achieve best value for the public purse, while delivering continuous service improvements.”

David MacBrayne Ltd has confirmed that it is interested in exploring the possibility of bidding for the next contract, which will be up for grabs in 2025. The limited company, owned by the Scottish Government, was first formed in 1851 and is now one of the largest logistics companies in Scotland.

After lying dormant for a number of years, it was reactivated in 2006 by Scottish ministers to act as the holding company for state-owned ferry operators. 

“It is important for any public sector bidder to have the appetite to bid; the capability and capacity to see the bid through; and the ability and resources to make the franchise a success,” Matheson continued.

“It is also our view that the Scottish Parliament and the Scottish Government should have full powers to consider all options for structuring our railways to meet Scotland's needs.”

Transport Scotland has stressed that future franchise competitions will “continue to be fair and transparent, giving equal treatment to all bidders whether from the public or private sectors.”

Late last year, data provided by a think tank commissioned by union TSSA claimed that nationalising ScotRail could lead to an instant 6% fare cut. In response, a spokesman for Abellio—the current TOC’s owner—said that the company has “no problem competing with a public sector bid should that be what the Scottish Government decides to do.”

The operator first said this back in 2016, when transport minister Humza Yousaf threatened to take back the franchise under government control if the company’s floundering performance didn’t improve.

But ScotRail has since then seen a turnaround in its performance after implementing an improvement programme across the company. Earlier this year, the ScotRail Alliance published a 20-point action plan which it says will further drive up standards and build the “best railway Scotland has ever had.”

(Top image c. George Clerk)

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