Virgin's Branson hits out at franchise 'insanity'

VIRGIN GROUP founder Sir Richard Branson has expressed irritation that his company has lost the bid for the West Coast franchise. It's the fourth time that his company has been defeated in a rail franchise competition, and he says it is 'extremely unlikely' that it will bid for rail contracts again.

FirstGroup will take over the West Coast intercity service on 9 December, having bid £5.5 billion for a franchise lasting for 13 years and four months.

It is believed that Sir Richard had already sounded a warning to transport secretary Justine Greening about the risks of accepting very high bids, pointing to the failures of two operators on the East Coast Main Line. After today's announcement he made his views public in an uncompromising statement.

He said: "Under our stewardship, West Coast has been transformed from a public liability into a valuable asset for the UK, worth many billions of pounds. The service is a British success story and one to put up against rail companies around the world. It is a great shame that such a strong track record has been discounted in the evaluation process for one of the UK’s most important infrastructure assets. The country's passengers, taxpayers and the West Coast employees deserve better.

“Based on the current flawed system, it is extremely unlikely that we would bid again for a franchise.  The process is too costly and uncertain, with our latest bid costing £14 million. We have made realistic offers for the East Coast twice before which were rejected by the Department for Transport for completely unrealistic ones and therefore will have to think hard before embarking on another bid.

"This is the fourth time that we have been out-bid in a rail tender. On the past three occasions, the winning operator has come nowhere close to delivering their promised plans and revenue, and has let the public and country down dramatically. In the case of the East Coast Main line, both winners – GNER and National Express - over promised in order to win the franchise and spectacularly ran into financial difficulties in trying to deliver their plans.  The East Coast is still in Government ownership and its service is outdated and underinvested, costing passengers and the country dearly as a result.

"Insanity is doing the same thing over and over again and expecting different results. When will the Department for Transport learn?"

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