DfT disqualifies Stagecoach from rail franchises

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The Department for Transport (DfT) has verbally informed Stagecoach that it has been disqualified from three UK rail franchise competitions after it was shortlisted.

The DfT excluded Stagecoach from the following franchising competitions:

East Midlands, where it was bidding independently;

South Eastern, where it was bidding with support from its intended partner, Alstom;

West Coast Partnership where it was part of a joint bid with Vrigin Group and SNCF.

The disqualifications come after the DfT expressed that Stagecoach had submitted non-compliant bids principally in respects of pensions risk.

Stagecoach Group Chief Executive Martin Griffiths said: “We are extremely concerned at both the DfT’s decision and its timing.

The Department has had full knowledge of these bids for a lengthy period and we are seeking an urgent meeting to discuss our significant concerns.

Stagecoach was bidding independently for the East Midlands rail franchise. RICHARD SHARMAN

“We have drawn on more than two decades of rail experience and worked in partnership with local stakeholders to develop high quality proposals to improve each of these rail networks.

“We bid consistent with industry guidance issued by the Rail Delivery Group and shared with the DfT.

Without ongoing Government support for the long-term funding of railway pensions, The Pensions Regulator has indicated that an additional £5bn to £6bn would be needed to plug the gap in train company pensions.

“In contrast, the rail industry proposed solution would have delivered an additional £500m to £600m into the scheme.

“This would have provided better stability and security for members and much better value for taxpayers.

“We are shocked that the Government has rejected this for a higher risk approach.

“We would urge that a full independent value for money review is undertaken into this issue without delay.”


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