Chris Grayling has awarded Stagecoach a new contract extension on its East Midlands Trains franchise, despite saying that the firm ‘got their sums wrong’ over the East Coast Mainline debacle.
In a written statement to Parliament, rail minister Andrew Jones said the transport secretary had reached agreement with Stagecoach Group to continue to operate train services on the East Midlands rail franchise until 18 August 2019 under a direct award.
An East Midlands train in Stagecoach livery
Mr Jones said the agreement will allow for a smooth transition into the next competitively-tendered franchise. He said: ‘If required there is an option to extend this agreement by up to a further 6 rail periods.’
The agreement is a further extension of a direct award to Stagecoach, following a delay to the new franchise linked to Mr Grayling’s decision in 2017 to cancel a number of electrification projects.
A report last year from the National Audit Office revealed that at that time Mr Grayling ‘specified that the next operator for the East Midlands franchise would deliver new bi-mode trains from 2022’, when in fact his officials had advised him that this was unlikely to happen as the 'bi-mode rolling stock of the required speed and acceleration to meet the timetable of the route did not currently exist’.
Last year, when Mr Grayling announced that the failed Virgin Trains East Coast rail franchise, in which Stagecoach was the majority shareholder, would be brought under government control, he told MPs that the firm would not make a profit from the franchise in the meantime. He said: ‘They got their sums wrong and they will pay the price for that – not the taxpayer.’
Mr Jones said that in the forthcoming months he expects East Midlands Trains to deliver the following improvements as part of the new agreement:
- investment of £150,000 on accessibility improvements at stations
- a simplified application process for Delay Repay
Stagecoach said it had operated the franchise successfully for over 11 years, returning over £200m to the taxpayer.