Virgin Rail boss Richard Branson has reacted angrily to the government’s award of the West Coast Main Line contract to rival company FirstGroup, branding the bidding system “flawed”.
Branson’s company has operated the line for the past 15 years, and for the most part has been judged to have run a good service. Part of that involved bringing in high-speed, tilting Pendolino trains; more than doubling passenger levels to around 31 million a year; and scoring well against other franchises in passenger surveys.
Bids for the next 14-year cycle of the regional franchise – which covers London, the Midlands and the central area of Scotland – had come from a range of operators, with FirstGroup emerging triumphant after bidding around £7bn: £1.2bn more than Branson. However, a long letter posted by the Virgin King himself on Wednesday morning accused FirstGroup of overstretching itself – a move that, in Branson’s view, would risk fare increases; service-quality cuts; and the bankruptcy of the operator. To support his stance, Branson highlighted the previous examples of GNER and National Express, which experienced huge difficulties on the East Coast franchise.
RMT chief Bob Crow has waded into the fray to back Branson, pointing to FirstGroup’s behaviour when running the Great Western route. In that instance, the operator declined to extend its original franchise contract – thus avoiding an £826m payment to the government. He also backed Branson’s claims that the contract would be paid for in job cuts, and threatened industrial action to prevent them. FirstGroup, meanwhile, have promised new electric trains, new services, and an extensive station-investment programme – but as any jaded commuter would testify, promising and delivering are clearly two different things.
Others still argue against privatisation of the railways entirely, with Manuel Cortes – leader of the Transport Salaried Staffs’ Assocation Union – advocating a “not-for-profit, publicly owned railway”: essentially, a return to the old British Rail days.
The fact that taxpayers currently subsidise the railways by £3bn a year more than in the days leading up to privatisation in 1994 – and that there is little scope for genuine competition in what is essentially a 14-year monopoly – suggests that Cortes may have a point.