Lord Adonis facing new franchise woe
Jul 9 2009 by William Green, The Journal
TRANSPORT Secretary Lord Adonis is facing claims of failing to keep Parliament informed about the Government’s “confused” handing of the failed East Coast rail franchise.
The allegations erupted after the Government effectively told rail operator National Express East Coast (NXEC) it had a year left – weeks before telling Parliament the contract was being scrapped.
The developments come amid fears of a £700m hole in Britain’s transport budget with ministers unlikely to get anything like the £1.4bn promised by National Express to run services between the region, London and Scotland.
But through freedom of information rules, it has emerged the DfT issued a formal notice to NXEC on June 16 informing the company “with immediate effect, they were subject to the last 12 months provisions of the franchise agreement”.
Such a notice is given when the Transport Secretary “reasonably considers” a default may occur or the contract terminated by agreement between the two sides within 12 months.
Lord Adonis told Parliament on July 1 the franchise was being nationalised after National Express announced “this morning” it would not financially support it.
No mention was given of the earlier notice despite one peer asking if the minister had “any idea” the franchise would collapse.
Lord Adonis said National Express had expressed concern about the franchise’s viability over a number of months, but insisted it was only in the “immediate run-up” to July 1 that the company “firmly” told the Government it intended to default.
And he gave no indication of the warning sent to National Express when he appeared before the Commons transport committee on June 17.
Lord Adonis said no rail operator had defaulted and that talks with train companies were commercially confidential amid speculation National Express tried to renegotiate its deal.
Industry expert Roger Ford, who writes for Modern Railways, said: “This freedom of information letter casts more light on the confused handling of a franchise in trouble.”
