Railways: North of England

Department for Transport written question – answered on 5th January 2016.

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Photo of Jonathan Reynolds Jonathan Reynolds Shadow Minister (Transport)

To ask the Secretary of State for Transport, what contingency plans his Department has for the funding of the new Northern and TransPennine franchises in the event that projected passenger number increases are not achieved.

Photo of Andrew Jones Andrew Jones Parliamentary Under-Secretary (Department for Transport)

Revenue risk for these two franchises lies with the franchisee, not the Department. This means the Department is not responsible for covering any shortfall in farebox revenue compared to the successful bidders' expectations.

The successful bids are backed by significant parent company support which can be called upon in life to ensure the liquidity ratios are met. Also both franchises were subjected to a financial robustness test as part of the bid evaluation process and considered low risk for the Department.

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