Calls to keep East Coast rail line in state hands after bidding fiasco

The Department for Transport yesterday suspended three officials after discovering the process by which it had assessed train companies’ bids to run West Coast services between London and Glasgow for the next 15 years was “significantly flawed”.

The contract had been controversially awarded to First Group ahead of Virgin, which has run West Coast services since 1997. That decision has now been scrapped, leaving the running of the service in limbo while transport officials scramble to find a solution.

Transport Secretary Patrick McLaughlin – who took up his post last month – said he was “very angry” at the mistakes, accepting that blame lay “wholly and squarely” with officials in his own department and promising £40m in compensation to the firms which wasted time and money bidding for the contract.

He said reviews had been launched and that officials are now considering how best to continue West Coast services ahead of a new franchise competition next year. Labour said the service should now be run by Directly Operated Railways, the state-owned firm set up in 2009 to run services along the east coast mainline after GNER pulled out of its contract.

Shadow Transport Secretary Maria Eagle said the state-run East Coast line has been a success, and that plans for a similar franchise competition for the East Coast must now be scrapped.

“I don’t think the franchise competition that’s planned for the East Coast should go ahead,” she said. “I think we need to have at least a public sector comparator, which this company can be on the East Coast.” She stopped short of calling for a full re-nationalisation of the railways.

‘Regional control needed’: Page 7; Comment: Page 12; Opinion: Page 13