Dwindling interest from rail companies could harm northern '˜rail revolution'

Department for Transport (Dft) delays to electrification plans and an alleged ‘lack of vision’ for the rail network have created an atmosphere of uncertainty for train companies, a House of Commons committee of MPs has warned.

Costs to the tax-payer may also soar if more is not done to encourage competition for the contracts and despite promises ageing Pacer trains will be axed from the network by 2018, the report by MPs found that it is “not clear” when rail users will see much promised improvements to their journeys.

However Transport Minister Andrew Jones is adamant that railway reform will be one of the shining successes of this Parliament and fuel the Government’s plan to reinvigorate the North of England’s economy.

Mr Jones, MP for Harrogate and Knaresborough, said: “We have huge economic clout but the amount of business that takes place between communities very nearby is remarkably low. That is why transport is a key part of the Northern Powerhouse. The new Northern Rail franchise is all about growth.”

He said in two decades the number of train journeys nationally had increased from 750m to 1.7bn, with 10,000 people now travelling to Leeds everyday.

From April this year Northern Rail will be run by Arriva and TransPennine Express by First TransPennine Express Ltd, but franchising in Britain is set against a backdrop of concern following contract flaws with West Coast Mainline in 2012 and the East Coast Mainline temporarily being taken back under public ownership.

The report by the House of Commons Public Accounts Committee (PAC) found that despite progress on franchising in the past few years there is a narrowing pool of train companies vying to take on the transport contracts after months of chaos, and a lack of joined-up thinking with track operator Network Rail.

Meg Hillier MP, chair of the PAC, said there is ‘declining competition’ within the franchising programme and most recently South Western rail only received two bids.

She said: “This hardly inspires confidence and highlights the urgent need for the Department to develop new approaches it can draw on when there is a risk competition will not deliver the result rail users and the wider public deserve.”

Delays over the Northern and TransPennine routes could mean competitions being run simultaneously in the future, straining the resources of bidders.

Hold-ups also mean more contracts may be automatically re-awarded to the original operator, giving them the opportunity to charge more to run the line.

The DfT welcomed the report, saying it confirmed the “significant progress” it has made but recognises there are challenges to overcome.