Latest Rail News

10.06.15

Scandal-hit Abellio facing inquiry calls into its franchise bids

Ministers are facing demands for an inquiry into rail franchises awarded to Abellio following a contract scandal in the Netherlands which resulted in the CEO being sacked along with the boss of its state-owned parent company.

Abellio chief Jeff Hoogesteger, who was predominantly based in the UK and who ran the company’s operations here, was dismissed on Friday without severance following dawn raids on Abellio’s Dutch government owned parent company, Nederlandse Spoorwegen (NS), and the resignation of its boss, Timo Huges.

Both men are alleged to have been involved in a scandal relating to a £1.4bn contract awarded in February to provide trains in the southern Dutch province of Limburg.

It was reported in the Netherlands that the raids were carried out as part of the investigation into possible abuse of dominance and other potential violations of the Dutch Railway Act.

Huges has been accused of giving an "incorrect and incomplete" statement about his involvement in passing on confidential information about a rival bidder during the tender process.

The Dutch contract has since been awarded to Arriva, who came second in the original bidding.

In the UK, the company runs the Greater Anglia franchise and recently took over the ScotRail franchise from First. It is also involved in joint ventures running the Northern franchise and Merseyrail.

The RMT union has written to the UK and Scottish governments calling for a full inquiry into all of Abellio’s bids.

General secretary Mick Cash said: “If the Dutch finance minister believes the whole culture in Dutch state railways/Abellio is wrong and needs to change, RMT believes there needs to be a full inquiry and for it to be clearly shown that there was nothing irregular with the award of the ScotRail franchise to Abellio or in respect of Abellio bidding for the Northern and Anglia franchises.”

Abellio was awarded the ScotRail franchise last October, beating out National Express, Arriva and MTR.

Following the award, the National Express managing director Mary Grant conveyed her concerns to former First Minister Alex Salmond and the rest of the Scottish cabinet.

She said the closeness of the bid scoring, which Abellio won by just 0.24%, should have been the catalyst for further final offers to be submitted to Transport Scotland to secure further benefits.

She also said that the National Express bid required "the lowest taxpayer subsidy" and asked for a detailed explanation as to why their attempt failed.

A Scottish government spokesman said: "We are aware of the outcome of investigations of the franchise competition for regional passenger services in Limburg.

"However we have received assurances that appropriate steps are being taken by Abellio UK to continue to manage its separate UK franchises by putting customers first.

"There is absolutely no suggestion of any conduct that puts the ScotRail franchise procurement process in doubt. Reviews by Audit Scotland and independent auditors have supported and indeed praised the process and the outcome."

A DfT spokesman said that the department was aware of the issue and is monitoring developments.

"We have robust processes in place to ensure the integrity of the rail franchise system is maintained at all times,” he added.

An Abellio spokesman told RTM: "The news from the Supervisory Board of NS, the Dutch owner of Abellio, is very serious for the Group. However this does not directly affect the leadership of the franchises we run in the UK which operate under distinct local management. Matters in the Netherlands will run their course but our focus here must and will remain entirely on continuing to serve our customers well."

(Picture: Library image of former Abellio CEO Jeff Hoogesteger following the ScotRail award. Source: Andrew Milligan / PA Wire)

Tell us what you think – have your say below or email opinion@railtechnologymagazine.com

Comments

Rufust.Firefly   10/06/2015 at 18:50

Well done transport scotland .who have managed to award these Franchises.Scotrail and Sleeper to the most shambolic companies within the British Train operating set up !!

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