East Midlands Rail Franchise

Part of the debate – in the House of Commons at 10:44 am on 11th April 2019.

Alert me about debates like this

Photo of Andy McDonald Andy McDonald Shadow Secretary of State for Transport 10:44 am, 11th April 2019

Clearly, the franchise system is in complete disarray. It seems that Stagecoach boss Martin Griffiths and Richard Branson have been taken completely by surprise by the announcement of the decision to disqualify Stagecoach from the discredited franchise process, seemingly for failing to provide sufficient commitments in terms of the pension scheme, bidders having been asked to bear full long-term funding risks on relevant sections of the railways pension scheme. Can the Minister inform the House about the pension commitments made by Abellio that warranted the award of the east midlands franchise and the extent to which any such commitments were distinct and more acceptable to the Department for Transport?

Is not this really payback for the east coast collapse, two years ago? The question on the airwaves today was whether this decision would propel Richard Branson back into his favourite hobby of suing Her Majesty’s Government over the awarding of contracts, which has served him so profitably over the years. What preparations has the Minister’s Department made in readiness for potential costly litigation flowing from this decision?

Why did the Department change the pension rules in the middle of the bids? On south eastern, that was only made clear after two rebids. Is not that moving the goalposts?

The real issue is that this Government, by sleight of hand, are trying to reduce their support for the railways pension scheme. They are trying to pass these costs on to the private sector. That is why both Stagecoach and Arriva defaulted on their bids for the east midlands franchise. The rail industry has a plan to reduce the deficits in its pension schemes, yet the Government have ignored that and are attempting to bulldoze through changes without consultation. That is reckless. It will concern rail workers and worsen the rail service for passengers. What discussions were there with the trade unions? Moreover, given that Keith Williams has been instructed to conduct a root-and-branch review of the operation of our railway, why has such a lengthy franchise been awarded before the Williams review reports later this year?

The announcement is accompanied by the decision to extend the franchise award on south eastern to Govia. How can it be right for that company to be given the nod to continue when it has delivered such a miserable service and completely failed its passengers? Is that not further reward for failure? Surely even this beleaguered Government can see what is staring them in the face: the franchise system is in total collapse. They need to respond to long-suffering passengers and do what the next Labour Government will do: bring track and train back together in state ownership—this state.