Talks have broken down between the Government and Stagecoach over the direct award renewal of the South West Trains rail franchise, leaving the contract open to the market.
Stagecoach’s contract on the services from Waterloo to the south coast, Salisbury and Reading, expires in 2017 and the company had expected to be handed a two-year extension. Stagecoach has been running the service for almost 20 years.
However the Department of Transport confirmed the franchise would go out to competition after it failed to reach an agreement with the firm.
In a statement Stagecoach said talks had ended with a ‘significant difference’ between the two parties regarding the financial evaluation of the proposals.
‘Nevertheless, as the incumbent operator with nearly 20 years' experience in growing and improving one of the most complex and busiest rail franchises in the country, we believe we are in a strong position to submit a powerful and attractive bid for a new South West Trains franchise,’ it said.
Secretary of state for transport Patrick McLoughlin said competition over the franchise would help produce a better deal for the public.
Rail, Maritime and Transport union (RMT) general secretary Mick Cash said ‘the chaos and confusion over rail franchising that was a permanent feature of the last government is continuing only months after the election’.
Mr Cash also took a swipe at public and private sector relations on the nation’s railways, claiming this area was ‘supposed to be the test bed for the "deep alliance" between train companies and Network Rail, that is now in tatters, wasting huge amounts of time and money that could have been invested in services’.