First will not take over West Coast from December

[northwichcat]

Yes. Which is exactly why Labour messed up on the ECML. Twice.

It wasn't Labour's fault that GNER's parent company Sea Containers collapsed.

 

[Solent&Wessex]

BBC News Website now saying 3 members of DFT staff have been suspended and that Virgin will continue to run the line while the issue is resolved.

 

[tgsh2011]

No, it's not excellent news, for crying out loud

It shows the government are scared of upsetting public opinion (for some bizarre reason on this topic of all things) and/or are scared of Richard soddin' Branson.

If they were any kind of government, and I say this as a fully paid up card carrying Liberal Democrat for over 10 years, they wouldn't have got into this mess in the first place

A probable victory for Branson's bullying, I fear.

Do you have any understanding of Public Law? It is not about "upsetting public opinion". If Virgin had won the JR after a contested hearing then the cost to the public purse (and chaos) would have been immense. Lawyers have decided that the process (which is what a JR examines not the outcome) was legally flawed. As such the decision (to award to First) gets quashed and the contest is run again taking into account the flaws identified.

It really is as simple as that! Nothing to do with upsetting Branson! It's the Law! Something lots of others on here are only to happy to point out when dealing with potential fare evaders!

 

[northwichcat]

The likes of FIRST and Stagecoach are low quality outfits handed state assets for virtually nothing during bus privatisation - a process that was basically corrupt.

Stagecoach own 49% of Virgin Trains so Stagecoach get millions in profit from the VT franchise. Stagecoach sold off Stagecoach Metrolink to RATP after realising TfGM wouldn't let them walk away with huge profits from that concession.

 

[jimm]

It wasn't Labour's fault that GNER's parent company Sea Containers collapsed.

And just the same as Tory ministers this time round, the Labour ministers acted on the advice of their civil servants. Does anyone seriously think that Justine Greening or any of her predecessors sat down to read the mountains of paper that the detailed franchise bids involve?

 

[Failed Unit]

Oh Goody!

I know that every second post starts with the words "I don't like Richard Branson but.....", well here's another one.

At least he built up a business in a virtual closed shop (VirginAtlantic) where others had tried and failed (Laker) even with heavy political backing.

The likes of FIRST and Stagecoach are low quality outfits handed state assets for virtually nothing during bus privatisation - a process that was basically corrupt.
These low grade bus companies should not have been allowed anywhere near the Rail industry.

Anything that does down First and Stagecoach is ok by me - Fair or Foul!

LOL - I love the irony of this post considering which company own 49% of Virgin rail group.
--- old post above --- --- new post below ---

BBC News Website now saying 3 members of DFT staff have been suspended and that Virgin will continue to run the line while the issue is resolved.

I suppose that is sensiable as they have the management structure in place already, although I hope virgin don't take the @£$% like the last time the franchise was on a management contract.

 

[Xenophon PCDGS]

I suggest picking up Modern Railways for Roger Fords incisive analysis on what goes on behind closed doors. The DofT comes across as grossly incompetent. At least nationalised BR was able to operate at arms length from them.

I had made the point about the October 2012 issue of Modern Railways that contained more than one article on this matter, as part of a posting that I had made on the previous thread just before it was locked by the moderators an hour later, this morning.

 

[barrykas]

DfT Press Release:

West Coast Main Line franchise competition cancelled

Transport Secretary Patrick McLoughlin has today announced that the competition to run trains on the West Coast Main Line has been cancelled following the discovery of significant technical flaws in the way the franchise process was conducted.

The decision means that the Department for Transport (DfT) will no longer be awarding a franchise contract to run the West Coast service when the current franchise expires on December 9. It is consequently no longer contesting the judicial review sought by Virgin Trains Ltd in the High Court.

The flaws uncovered relate to the way the procurement was conducted by department officials. An announcement will be made later today concerning the suspension of staff while an investigation takes place.

The Government is resolving urgently the future arrangements for operation of the West Coast and will ensure that train services continue uninterrupted. Mr McLoughlin stressed today that passengers will continue to be served by the same trains and frontline staff.

The Transport Secretary has also:

• Ordered two independent reviews to be undertaken urgently: the first into what went wrong with the West Coast competition and the lessons to be learned, the second into the wider DfT rail franchise programme, both overseen by leading business figures;
• Asked officials to examine the options for the operation of the West Coast service after December 9, taking into account procurement and competition law;
• Paused all the other outstanding franchise competitions (Great Western, Essex Thameside and Thameslink) pending the independent reviews which are designed to ensure future competitions are robust and deliver best value for passengers and tax payers.

Mr McLoughlin said:

“I have had to cancel the competition for the running of the West Coast franchise because of deeply regrettable and completely unacceptable mistakes made by my department in the way it managed the process.

“A detailed examination by my officials into what happened has revealed these flaws and means it is no longer possible to award a new franchise on the basis of the competition that was held.

“I have ordered two independent reviews to look urgently and thoroughly into the matter so that we know what exactly happened and how we can make sure our rail franchise programme is fit for purpose.”

He added:

“West Coast passengers can rest assured that while we seek urgently to resolve the future arrangements the trains that run now will continue to run, with the same drivers, the same staff and timetables as planned. The tickets that people have booked will continue to be valid and passengers will be able to make their journeys as planned.”

DfT permanent secretary Philip Rutnam said:

“The errors exposed by our investigation are deeply concerning. They show a lack of good process and a lack of proper quality assurance.

“I am determined to identify exactly what went wrong and why, and to put these things right so that we never find ourselves in this position again.”

The first independent review will be an urgent independent examination into the lessons to be learned from the Department’s handling of this competition. Conducted by independent advisers and overseen by Centrica chief executive Sam Laidlaw and former PricewaterhouseCoopers strategy chairman Ed Smith, both DfT non-executive directors, this review will look as soon as possible at what happened and why with a view to delivering an initial report by the end of October.

The second independent review will be undertaken by Eurostar chairman Richard Brown CBE, and examine the wider rail franchising programme. It will look in detail at whether changes are needed to the way risk is assessed and to the bidding and evaluation processes, and at how to get the other franchise competitions back on track as soon as possible. This will report back by the end of December.

Evidence of significant flaws in the Department’s approach emerged while officials were undertaking very detailed evidence-gathering in preparation for legal proceedings in the High Court.

These flaws stem from the way the level of risk in the bids was evaluated. Mistakes were made in the way in which inflation and passenger numbers were taken into account, and how much money bidders were then asked to guarantee as a result.

The Department cannot be confident that these flaws would not have changed the outcome of the competition or that any of the four bidders would not have chosen to submit different offers.

The DfT has spoken to the four bidding companies to inform them of the flaws that the Department discovered. The DfT will reimburse their bid costs and has assured them that a fresh competition will be started as soon as the lessons of this episode are learned.

Notes to Editors

1. Richard Brown, the chairman of Eurostar, is a former chief executive of Eurostar and previously commercial director and a main board director of National Express Group, where he set up its UK Trains Division, at the time the largest UK passenger franchise operator. He has spent 35 years in the transport industry and was a director of British Rail’s Intercity Division before privatisation.
2. Sam Laidlaw has been chief executive of energy company Centrica since July 2006 and has been a non-executive director of HSBC Holdings Plc since January 2008. He has been the lead non-executive board member of the Department for Transport since December 2010 and is also a member of the UK Prime Minister’s Business Advisory Group.
3. Ed Smith is a non-executive board member of the Department for Transport and was formerly chairman of strategy for PricewaterhouseCoopers, deputy chairman of the Higher Education Funding Council for England, as well as chair of their Leadership, Governance and Management Strategic Advisory Committee.

 

[northwichcat]

And just the same as Tory ministers this time round, the Labour ministers acted on the advice of their civil servants. Does anyone seriously think that Justine Greening or any of her predecessors sat down to read the mountains of paper that the detailed franchise bids involve?

Saying everything was down to Greening would be like saying everything relating to Virgin's bid was down to Branson. It's not possible for one person to do everything but someone has to make the final decision and justify it based on the evidence presented.

Although, Branson would be in a position to remove people from their jobs should they feed him misleading information. Could a minister do the same?

 

[F Great Eastern]

If Virgin did get an extension, is there any legal basis that would allow this in the current franchising process? I know it was talked about in the other thread and the view of some was that it could not happen because of the one optional extended period was already taken and therefore the only option would be to transfer to Directly Operated Railways?

If this does not happen could it lead to the other three bidders possibly challenging the fact that Virgin have been awarded in theory another short term contract by default without following the full process?

 

[Cliveblackpool]

And just the same as Tory ministers this time round, the Labour ministers acted on the advice of their civil servants. Does anyone seriously think that Justine Greening or any of her predecessors sat down to read the mountains of paper that the detailed franchise bids involve?

You don't sign anything unless you have read it!
My first choice for operating the WCML is 'Directly Operated Railways'
Second choice is Virgin trains.
I get the impression that the only ''improvements'' from First group at Preston Station would be Barriers!

 

[ert47]

Makes me wonder if this fiasco is going to cause more delays to the Thameslink Programme...

 

[Wolfie]

He's effectively bullied the Government into changing their mind, of course he's happy

Sorry, I just think he should have just accepted the decision. He's an unelected millionaire, not an MP.

As a civil servant (thankfully nothing to do with DFT) who has no visibility of what exactly has gone wrong with this whole process, I just have to say RUBBISH! What you are basically saying is that no individual should have the right to challenge the decisions of Govt or the workings of the civil service! I believe that is called a dictatorship. Thankfully European law has a rather different view......

 

[kylemore]

LOL - I love the irony of this post considering which company own 49% of Virgin rail group.
.

Yes it is ironic, I suppose all that cash made from the corrupt bus privatisation process available for investment was too tempting for Branson - nobody's perfect

You don't have to be a rabid Branson fan to enjoy the spectacle of First's and the DFT's noses being rubbed in the proverbial!

 

[Wolfie]

This is not a good day. All Branson has done is set a precedent so now if a company doesn't win a bid, they might as well launch legal challenges. This is going to cost the railway 10 or even 100 of millions of pounds which could be a lot better spent. I fear the worst

Something which has ALWAYS been possible and indeed has actually happened before albeit not in such a high profile manner.....

 

[northwichcat]

I get the impression that the only ''improvements'' from First group at Preston Station would be Barriers!

First Group have proposed new additional 6 car electric trains for Birmingham-Preston-Scotland (Virgin proposed new 6 car electric trains as Voyager replacement) and Blackpool-Preston-London services.

Virgin might be saying their bid includes more investment in stations but they haven't invested that much in stations over the past 15 years compared to other operators and many of the worst 10 category A stations were found to be ones run by Virgin.

 

[F Great Eastern]

Makes me wonder if this fiasco is going to cause more delays to the Thameslink Programme...

I thought that too, the last thing we need in this country is YET MORE delays to introduction and therefore cascading of rolling stock we've had too much of that as it is over the past few years.

The IEP and Thameslink rolling stock orders are taking an age and then we have all the other canceled orders over the past few years and the network is at breaking point at the moment the last thing we need is further delays.

 

[Wolfie]

The fact that this has happened just before the judicial review at the High Court means DfT had legal advice that they were going to lose badly at the High Court and be on the receiving end of a pretty damning judgment. Better to come forward and admit your mistake than have a judge do it for you.

A High Court judge would not in any way be influenced by the personalities and politics of the case.

From the interview given by the Secretary of State on BBC Radio 4 this morning the flaws identified are much wider than those cited by Richard Branson.

Having been involved with judicial reviews for Govt and having dealt regularly with TSOL and QCs you are spot on!

 

[Geezertronic]

And still there are people giving their 2p with anti Branson/anti VT comments. Some comments on this thread (and the others) are just plain stupid.

This is not a victory for any PR machine, VT or Branson. It would seem that common sense has dictated todays announcement with the blame being firmly laid at the door of the DFT. Whether VT would win a new process is irrelevant.

Whether you consider the way it was handled to be incorrect or not, Branson/VT did what any proper company would do and if I was a shareholder in the Virgin Group or Stagecoach I would expect them to.

 

[TheJRB]

I think that it doesn't matter if you're pro Virgin or First, what's really important is that the government has let us down. It's good that they've admitted it but it needs to be dealt with properly. If that happens I don't really think it will be a free for all with regard to new franchises.

We really need to start focusing more on what's going to happen next rather than who bid what and who likes or dislikes Richard Branson. I do wonder whether or not this fiasco will put off potential bidders for future franchises though.

 

[Realfish]

The Transport Secretary has also:

Ordered two independent reviews to be undertaken urgently: the first into what went wrong with the West Coast competition and the lessons to be learned, the second into the wider DfT rail franchise programme, both overseen by leading business figures

It occurs to me that this investigation should also inquire into leaks to the media disclosing details of the winning bid, two weeks before the official announcement. These leaks contained information which suggests that they could only have come from DfT.

 

[Whistler40145]

With all that's gone on, does anyone think First will jump ship & not re-apply for the franchise?

 

[northwichcat]

I thought that too, the last thing we need in this country is YET MORE delays to introduction and therefore cascading of rolling stock we've had too much of that as it is over the past few years.

The IEP and Thameslink rolling stock orders are taking an age and then we have all the other canceled orders over the past few years and the network is at breaking point at the moment the last thing we need is further delays.

Like I've said before Thameslink is already too far behind schedule to allow the 319s to be cascaded in time for North West routes and the 2014 timetable recast. Given that since the 319 cascade was announced that further local routes in the Leeds area can become electric (as a result of North TPE electrification) and also the Cardiff Valley Lines, I see no reason why a batch of new EMUs can't be placed for the North West as there will still be plenty of routes that will be able to make use of the cascaded 319s over the next few years.
--- old post above --- --- new post below ---

With all that's gone on, does anyone think First will jump ship & not re-apply for the franchise?

Would then a third bidder have to become involved to take First's place as a preferred bidder?

 

[Pen Mill]

The worrying thing here is that if the process was so flawed , who is going to be able to devise a new bidding system that isn't capable of being challenged in public as this has been ?

Any lawyer worth his salt will be able to find a show-stopping flaw in any document of 100s of pages and prompt PPI type fiascos

Renationalisation on a fixed intra-party budget policed by a select committee is now the only sensible option for me.

Stop this same sorry mess happening to the health service before it's too late PLEASE !

 

[HH]

Would then a third bidder have to become involved to take First's place as a preferred bidder?

Third Bidder? They're restarting the whole process.

 

[Oswyntail]

Contrary to what i guess will be put about, this does show how stupid it is letting people from "the industry" have key roles in the upper branches of a government Department. By all means have them in as advisers, but control them. Civil Servants know (knew?) how to run fair procurement processes, but this has been tainted by industry specialists - possibly stirring up an "anyone but Virgin" ethos.

 

[Pen Mill]

Third Bidder? They're restarting the whole process.

They won't know what the process is for a long time to come yet.
My guess is that there will have to be a rapid contract extension process for all terminating franchises to allow a ROBUST system to be put in place.

 

[island]

I wonder will Sir Beardy honour his promise to run the WCML for free after 09-DMR?

Edit: Oops, LTJ87 beat me to it!

 

[barrykas]

And ATOC have thrown their 2p's worth in as well:

Train companies respond to DfT franchising announcement

Responding to today’s DfT announcement, Michael Roberts, Chief Executive of the Association of Train Operating Companies (ATOC) said:

“The discovery of significant flaws in the DfT’s franchising process is a cause of great concern. It is in the interests of passengers, taxpayers and the rail industry that the DfT solves these problems as a matter of urgency.

“Franchising private companies to run train services has delivered for the country, with rail travel more popular now than at any time since the 1920s and near record levels of satisfaction and punctuality. The cancellation, however, of the InterCity West Coast franchise allows the DfT to reappraise its approach to franchising and implement rapid improvements.

“The two independent reviews will need to restore the confidence of taxpayers and passengers, and those who might want to bid for franchises in the future. We look forward in particular to engaging with the review into the wider rail franchising programme.”

 

[PR1Berske]

http://www.bbc.co.uk/news/business-19809717

Transcription:

Patrick McLoughlan (Transport Secretary): It's very embarrassing, it's deeply regrettable, and basically it's unacceptable that we should find ourselves in the position that we are.
Susanna Reid (BBC presenter and Forum Pin-up): So, what went wrong?

PMc: What went wrong was there was a, this is a long process, it's a 15 month process. In which time, er, a number of factors should have been taken into account. It is now obvious that they were not taken into account. And some of the details, er we need to, er, make sure of are being, are now to be investigated by two investigations that I've ordered this morning.

One first into the conduct of the way in which the bid was operated, er, in the department. But also if there are wider lessons for the actual franchising system for the future. This government is putting huge amounts of money into the railways. That's being done on the taxpayer's behalf but the taxpayer and the passenger need to know if they're getting a good service.

SR: Yeah, okay, the, there's so much, there's so much to go through here. But if I just, first, if I just go back to your predecessor, Justine Greening. I looked back this morning at the interview that she did on this programme when the contract was taken from Virgin and given to First Group.

She said that it had been "fair and well adjusted and robust process run over fifteen months". That First were going to "offer more seats, new services, improved services, invest in stations and provide a better deal for taxpayers." Em, was all of that wrong?

PMc: It, it wasn't wrong as far as what First had offered. Erm, she was right on that indeed Ministers were right in the advice they had been previously given.

SR: Hang on.....

PMc: What has, what has come....

SR: Hang on, she was asked, when she was asked, she began by saying "It was a fair and well established and robust process ..."

PMc: What has come this....

SR: You have said this morning that that, for a start, was not right

PMc: What has come to light is that there was serious mistakes made. Erm, we were l....told....that the there was a robust....er....service....That has not proven once we've done proper searches because of the court case which was pending.

SR: Okay, so this is all of a result of Virgin bringing a legal action?

PMc: What has...It is.....What has come to light is not what Virgin were arguing but other issues within that particular contract. But those are.....in a way they are quite legalistic arguments..

SR: Well, no, but hang on, you're....

PMc: Well, because, you're...

SR: You've not been able to say as you did to the Transport Select Committee that the process was conducted properly and Justine Greening would have been able to say that it was a fair and robust process, when you now know that is not the case....But if Virgin hadn't brought that legal action, we would never have known that?

PMc: I, that, I fully accept that particular point. And that is why we have launched, I have launched two investigations into a) what went on in the department but also to learn lessons for future franchising.

So we've put on, er paused, the three franchises were are currently out and I hope that report will be with me by 31st December this year. I hope the report into the department will be with me by the end of the month.

SR: Okay, em, are you re-running the whole bidding process? It cost these companies millions?

PMc: Yes, and we'll reimburse these companies that have so far bidded so we will have to rerun those but what I also....

SR: So now it's going to cost the taxpayer millions?

PMc: It is, it is going to cost us a lot of money because of this mistake, yes.

SR: Do you know at this stage who will be running the railway in December?

PMc: Erm. Well I can say very definitely on the 9th of December when at the moment the Virgin franchise ends the trains will continue to run. Erm...I am looking today at whether Virgin can run them or whether we move to a Directly Operated Railway system, as is run on the East Coast mainline when the last Government had a franchise collapse on it.