Dft accused over National Express

11 July 2011

ASLEF welcomes a report by the House of Commons Public Accounts Committee (PAC) into the bid by National Express for the East Coast rail franchise. The report concludes that the Department for Transport did not to carry out ‘due diligence’ by failing to factor the economic downturn into National Express’s £1.4b bid.

The report added that by failing to block future bids by National Express, and paying £120m to terminate their contract , despite an offer by National Express to end the deal by mutual consent, the Department of Transport was guilty of ‘creating a moral hazard’ which resulted in losses to the taxpayer of £30m.

According to the chair of PAC, Margaret Hodge MP, these failures will only ‘incentivise other loss making franchises to terminate rather than renegotiate their contracts’. At the time of the debacle ASLEF called for National Express to be stripped of both its East Coast Franchise, and its contract to operate C2C but the government refused to act. ASLEF general secretary Keith Norman said 'this report confirms that National Express’s continued presence in the UK’s rail industry insults both taxpayers and the long suffering commuters who have no choice but to use their trains.'

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