Extract from Opposition day debate on Rail Franchising - Jan 10
Thursday, 11 January 2018 08:16
Andy McDonald (Middlesbrough) (Lab):...All the factors I have
described undermine the growth forecasts that are so central to the
Government’s model and the undeliverable bid assumptions of
operators. FirstGroup won the TPE—TransPennine
Express—franchise in December 2015 based on revenues increasing by
12% a year. In one of his first acts in office, the Secretary of
State awarded the Greater Anglia franchise to the Dutch state-owned
rail company Abellio in August 2016. The...Request free trial
(Middlesbrough)
(Lab):...All the factors I have described undermine the
growth forecasts that are so central to the Government’s model and
the undeliverable bid assumptions of
operators. FirstGroup won the TPE—TransPennine
Express—franchise in December 2015 based on revenues increasing by
12% a year. In one of his first acts in office, the Secretary of
State awarded the Greater Anglia franchise to the Dutch state-owned
rail company Abellio in August 2016. The deal commits the company
to paying the Government £3.7 billion to run the line for nine
years. That is more than the east coast franchise. Reports suggest
that Abellio’s bid was £600 million more than the next bidder. Like
the TPE and east coast bids, Abellio’s bid was based on
double-digit annual revenue growth. The company’s boss described
the £3.7 billion price tag as “scary”. Does the Secretary of State
guarantee that the Treasury will receive the full premium payment
of £3.7 billion from Abellio Greater Anglia by 2025—yes or no?
(Colchester)
(Con):...I have served on the Transport Committee
with my hon. Friend for two years. He is right that, in the
invitation to tender for our most recent franchise on the Great
Eastern main line, the three companies that put in a bid were
Abellio, the existing franchise holder; National Express, which had
had the franchise taken away when it was given to Abellio;
and FirstGroup, which had had the franchise
taken away when it was given to National Express. He is right that
we need to encourage more bids...
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