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West Coast franchise award scrapped
The competition to run trains on the West Coast Main Line has been cancelled following the discovery of significant technical flaws in the way the franchise process was conducted, Transport Secretary Patrick McLoughlin announced.
The decision means the Department for Transport (DfT) will no longer be awarding a franchise contract to run the West Coast service when the current franchise expires in December.
FirstGroup was due to take over the running of the London to Scotland line after being awarded the contract by the DfT in August, but Virgin Rail, which currently runs the service, launched a High Court challenge against the decision.
The DfT said it would be no longer contesting the judicial review sought by Sir Richard Branson's company. Mr McLoughlin has also ordered two independent reviews into the competition process. The flaws uncovered by the DfT relate to the way the procurement was conducted by department officials, it said.
An announcement is expected to be made later about the suspension of government staff while the investigations are conducted. The Government said it was "resolving urgently" the future arrangements for operation of the West Coast service - which was due to be handed over to FirstGroup on December 9.
Mr McLoughlin said: "I have had to cancel the competition for the running of the West Coast franchise because of deeply regrettable and completely unacceptable mistakes made by my department in the way it managed the process.
"A detailed examination by my officials into what happened has revealed these flaws and means it is no longer possible to award a new franchise on the basis of the competition that was held. I have ordered two independent reviews to look urgently and thoroughly into the matter so that we know what exactly happened and how we can make sure our rail franchise programme is fit for purpose."
FirstGroup said that until it was notified by the DfT on Tuesday night, it had no indication there were any problems with the franchise process. The firm said in a statement: "Until this point we had absolutely no indication that there were any issues with the franchise letting process and had received assurances from the DfT that its processes were robust and that it expected to sign the contract with FirstGroup soon. We are extremely disappointed to learn this news and await the outcome of the DfT's inquiries."
Writing on his blog on the Virgin website, Sir Richard Branson welcomed the decision and said he was always convinced the Government's competition process was flawed. He said: "At the House of Commons Select Committee we called for all franchise competitions to be paused and a thorough, independent review of the process. We are grateful that Patrick McLoughlin is now doing this.
"We also appreciate the DfT publicly acknowledging these errors, and are hopeful they will now accept that Virgin Trains should carry on running the West Coast Main Line and ensure that passengers continue receiving our team's award-winning service."