Latest Rail News

31.08.12

WCML decision ‘unlawful’

Virgin Trains has labelled the transport secretary’s decision to award the WCML franchise to FirstGroup “unlawful” as the company seeks to launch a judicial review into the proceedings.

The £13.3bn contract was due to be signed on Wednesday, but the legal challenge has provided a delay.

Virgin has suggested that the DfT should have ordered FirstGroup to provide a much higher guarantee against the risk that it will fail to honour the contract.

A DfT spokesperson said: “We will fight these claims robustly and show clearly that these allegations by Virgin and their business partners Stagecoach are ill-founded and misconceived. We expect to sign the contract soon.

“We will not comment at this time on specific allegations made in the court pleadings but will respond in detail shortly. We are confident that our process is robust and that the decision reached was absolutely the right one for taxpayers and passengers.”

The company is also calling for FirstGroup to clarify its franchise commitments through a series of published obligations detailing investment in stations and fleet.

Tony Collins, Virgin CEO, said: “So far we have had an interesting wish-list from FG but no firm commitments and our customers and MPs would expect to know more about these before any contract is signed by the Government.

“In any event, our firm commitments are more extensive than FG’s wish-list. It is time for Mr O’Toole to come clean and reveal the true commitments.”

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

Comments

Rory O'rourke   31/08/2012 at 12:35

The Virgin Train Service is an exceptional one, this may be case of Virgin knowing what the true costs are with maintaining such high quality and FG not. The bid documents are often 'wooly' and subjective as to the degree of quality required, this affects costs when one company assumes a level of quality in delivery higher to another. It's a shame we crave savings over quality.

Barrie Hamilton   31/08/2012 at 12:40

Surely it’s time to ensure that all these franchises and other government contract awards out side the rail industry were made truly transparent. The tax payer cannot see whether we are getting value for money and that the evaluation process is carried out in a fair manner. Secondly it appears all to easy for a franchisee to walk away from a contract because it does not pay. Once a contract is signed and the deal struck it must be fulfilled. The directors of the franchisee must be held fully accountable including severe financial penalties in the event of a default. We cannot expect the taxpayer to just roll over once again and soak up the financial losses. I have to say that if FG track record with other rail franchises was taken into consideration the government would have to be bonkers in awarding them the WCML

Donmak   31/08/2012 at 13:20

The WCML is underpriced simply becuase of some of unforeseen incidents that are beyond Network Rail. If Virgin is keen on operationg the route, then they should step up with more money. DfT is lenient even with what FG is paying.

Les F   31/08/2012 at 17:22

Virgin's desperate attempts to keep the franchise show just how profitable it must be. They don't want to lose their gravy train. Remember their franchise started when we had no experience of franchises, they took everything they could get in compensation during the WCML modernisation, they pressed Railtrack to waste millions proving that short possessions are no use for major works on working railway, and they exercised their Moderation of Competition rights to prevent other operators providing the services they wanted to, against the public interest. Thankyou Virgin for showing us a level of customer service that British Rail could only dream of, and goodbye. All that is needed now is for NetRail to explain their decision.

VJ   31/08/2012 at 19:51

Something underhand if you ask me. FG have the worlds worst reputation but yet they get the WCML. Brown envelopes and back handers got FG that contract. Why fix something that isn't broke unless of course there is an alteria motive, BIG mistake, watch this space.

Robert Wise   02/09/2012 at 09:09

Branson is annoyed because West Coast is his pride and joy has been beaten fair and square in a bidding battle. If he wanted to win then he should have bid more - simple as that. It is rather like the guy who came second to Usain Bolt saying he wanted a re-run and would have trained harder had he known that Usain Bolt was so fast.

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