Rail jobs worry as East Coast line changes hands

Nov 12 2009 by William Green, The Journal

Lord Adonis holds talks with Arriva over rail franchise system

TRANSPORT Secretary Lord Adonis has held talks with Sunderland-based Arriva about the rail franchise system.

A meeting between Lord Adonis and transport company’s chairman Sir Richard Broadbent was held within weeks of the East Coast franchise being axed in July.

Minutes of the meeting, released under Freedom of Information rules, show there was a discussion about Arriva’s CrossCountry and Wales rail franchises.

There were suggestions the Government should be “more flexible” in managing contracts.

Sir Richard also said the Department for Transport rethink its approach to risk and revenue sharing with operators.

Lord Adonis noted the comments and said he was pleased Arriva intended to honour its contractual obligations.

The revelations come amid speculation about other franchises, although Arriva said its operations were performing well.

Revenue growth on the CrossCountry network slowed to 1.3% in the 42 weeks up to October 24. Arriva Trains Wales posted growth of 6.7% in the same period.

Industry expert Roger Ford, of Modern Railways, said: “CrossCountry is one of the franchises where revenue growth is substantially below forecast and inter-city franchises are suffering the most.”

Simon Craven, Arriva director of communications, said: “The DfT and indeed the whole of the industry are looking at the question of how might future franchises best be constructed.”

He said there was a “broad acceptance” of the need for improvements, particularly longer franchises to ensure greater certainty, more investment and cutting the cost of the current system.