Train passengers in the North East expressed their “disappointment and anger” over the reprivatisation of East Coast train services.
The franchise was handed over to Stagecoach and Virgin – an act rail users in Tyne and Wear described as a “fait accompli.”
“Our publicly owned East Coast rail returned money to the taxpayer over the last five years, contributing to £1 billion to the government – far more than when it was run by private companies GNER and National Express,” said Vicki Gilbert, chair of the Tyne and Wear Public Transport Users Group.
“For rail passengers from the North East and elsewhere, it is likely that there will be new larger fare increases along with cuts in costs, by reducing the staffing on trains and at stations.
“This will mean a poorer service for passengers, while profits go into the pockets of the Stagecoach and Virgin’s companies shareholders.
“This cost cutting is very concerning for everyone but particularly for the disabled and vulnerable, who rely on assistance with wheelchairs and pushchairs.
“This will also affect passengers’ personal security, with figures already showing an increase in violence, drinking, anti-social behaviour and attacks across the entire rail network in England.”
Jarrow MP Stephen Hepburn also expressed his opposition to the move, which the government hopes is a case of third time lucky after two previous private franchises running the line collapsed, causing it to be placed into the hands of the state owned Directly Operated Railways in 2009.
“Over the past six years since it was re-nationalised the East Coast mainline has gone from strength to strength and it is a disgrace that the Tories are selling it off before the election,” Mr Hepburn said.
“The Tory-led Government’s plans defy all logic and by taking East Coast out of public ownership all the government is doing is passing the income the line raises into the back pockets of the profiteers.”
Under the new name of Virgin Trains East Coast, the franchise’s first service left Newcastle bound for London at 7.55am on Sunday.
The Department for Transport said it was confident that the new franchise was the best way forward, but trade unions have pointed to the huge sums the publicly owned line has been able to return to the Treasury.
TUC general secretary Frances O’Grady said:
“It is disappointing to see East Coast in private hands after five years of public sector success. The Government’s decision to re-privatise the line is a costly mistake.”
But a Department for Transport spokesman said:
“The skills and experience that the private sector provides drives forward innovation and investment, and has helped to transform our rail network into a real success story.
“We are confident that the new East Coast franchise gives the best deal for passengers. It will provide more seats, more services, new trains and over £140 million of investment along the route. In addition, more than £3 billion will be paid to taxpayers.”
Source – Newcastle Evening Chronicle, 02 Mar 2015
> If it aint broke… break it.
The East Coast Main Line franchise made a profit of £13 million last year – with the cash returned to the Treasury.
And the financial success of the line is in stark contrast to other (privatised) rail franchises, which required millions in subsidies to keep going.
Labour said the figures exposed the foolishness of privatising the line, which is currently run by a state-owned business but is due to be managed by Virgin Trains from March.
They were published in the annual financial report of the Office of Rail Regulation, the official regulator for Britain’s railways.
The East Coast Main Line was one of only two rail franchises to make a profit for taxpayers. The other was South West Trains.
Virgin Trains, which currently runs the West Coast Main Line from London to Manchester and on to Scotland, received £221 million in subsidies.
And the most expensive franchise was the Northern Rail line, which operates in the North East, North West and Yorkshire, and received £495 million.
A separate study by consumer group Which also found the East Coast Main Line had a good record for train delays, coming sixth out of 21 franchises for the lowest number of delays.
Labour’s Shadow Rail Minister Lilian Greenwood MP said:
“These reports prove that the forthcoming East Coast sell-off is set to be a terrible blunder that puts privatisation ahead of passengers’ and taxpayers’ best interests.”
“East Coast was one of only two train operating companies that made a net contribution to the Treasury once infrastructure costs were taken in to account.”
Labour plans to allow a state-owned operator to bid for future franchises, although this would still potentially allow private operators to run franchises if they win the bidding process.
The policy not supported by some Labour MPs who argue that franchises should simply be transferred to the public sector once they expire.
Rail Minister Claire Perry said:
“We are investing record amounts in our railways as part of our long-term economic plan and passenger fares have a crucial role to play in funding these improvements, which will bring more services, more seats and modern trains.
“As we drive forward this huge investment programme, it is absolutely important that disruption to passengers is kept to a minimum. It is also important that we recognise passengers’ concerns about the cost of rail fares. This is why we have frozen them for the second year in a row.”
The Office of Rail Regulation said rail industry income from passengers in 2013/14 was £8.16 billion – a 10.8% rise compared with the figure for 2010/11 and 6.2% higher than in 2012/13.
Government funding for the railways in 2013/14 was just under £3.8 billion – a 16.4% dip on the total for 2010/11 and 8.1% down on 2012/13.
Total Government funding in 2013/14 varied from £1.88 per passenger journey in England to £7.77 per journey in Scotland and £9.18 per journey in Wales.
Government funding in 2013/14 represented 28.5% of the rail industry’s total income.
The number of passenger journeys increased by 16.6% (or by 260 million journeys) between 2010/11 and 2013/14, with the amount of freight carried rising 18.1%.
ORR chief executive Richard Price said:
“There has been substantial growth in the use of the railways in the past four years. Passengers are increasingly the main funder of the railways, and must be central to developing plans for future services and investment.
“Our report also highlights that the rail industry has been successful in keeping costs stable despite carrying significantly more passengers.”
Source – Newcastle Journal, 16 Feb 2015
> Bit of a suprise… everyone seemed to expect the French bid to win.
Virgin Trains and Stagecoach have won the franchise to run the East Coast mainline rail route, it emerged this morning.
The controversial takeover has seen the firms promise to invest £140m in the route over eight years, and will pay the government £3.3bn for the contract.
Rail Minister Claire Perry is expected to be at Newcastle Central Station today and the franchise, which covers the route between London and Edinburgh, has been publicly run since 2009.
The anticipated move was lambasted by Labour MPs in the North East, after the publicly-run Directed Operated Railways brought the line back into profit.
Ahead of this morning’s decision, Dave Anderson, Blaydon’s Labour MP, said:
“This shows the real contempt that this coalition feels for the people of the North.
“We have seen continuing failures by private companies in running our line over the period since privatisation until the public sector stepped back in and stopped the rot and we have seen increased punctuality accompanied by increased usage by the travelling public which has delivered the best economic performance of any UK train service.
“This counts for nothing in the world of Conservative dogma. It shows, yet again, that this Government will ignore the wishes of anyone as it steams ahead with its ideological attack on the public sector in our country.”
East Coast paid a record £235m back to the Government in its final full year in public hands – up 12% on the previous year. Proof, unions believe, that a private sector deal is politically-motivated.
Grahame Morris, Easington MP, dismissed the privatisation of the line this week as “right wing Tory dogma”.
He said: “This public-run rail franchise has generated over a billion pounds for the Treasury.
“If this is what a publicly-run train operating franchise can deliver, at a time when every penny counts, we should be looking at ways to bring privately run railways back into public ownership not the other way round.
“This is right wing Tory dogma being put ahead of the best interests of the service, consideration for passengers and the public finances.
“The public-run East Coast Main Line franchise has consistently been the best performing franchise when it comes to passenger and staff satisfaction, fares and profitability.”
Source – Newcastle Evening Chronicle, 27 Nov 2014
Easington Labour MP Grahame Morris and transport unions have reacted with fury to reports that the UK’s only Government-run rail line is to be taken over by a consortium largely owned by the French state.
Mr Morris said the decision to re-privatise the East Coast line was “right-wing Tory dogma being put ahead of the best interests of passengers”.
Edinburgh East Labour MP Sheila Gilmour and the RMT and TSSA unions were also highly critical of the expected decision.
The UK Government has been anxious to return the London to Scotland East Coast main line to the private sector ever since it was taken over from National Express by the Department for Transport in 2009.
But now it is likely that this week’s announcement of a new private franchise will see the line, from next year, being run by joint bidders Eurostar and French transport company Keolis which is 70% owned by state-run French rail company SNCF.
Opponents of the move to re-privatise the East Coast line have pointed out that the public-sector run company has made big returns to the Treasury during its tenure.
Mr Morris said:
“This public-run rail franchise has generated over a billion pounds for the Treasury. If this is what a publicly-run train operating franchise can deliver, at a time when every penny counts, we should be looking at ways to bring privately run railways back into public ownership not the other way round.
“This is right wing Tory dogma being put ahead of the best interests of the service, consideration for passengers and the public finances. The public-run East Coast main line franchise has consistently been the best performing franchise when it comes to passenger and staff satisfaction, fares and profitability. “
Ms Gilmore said:
“Passengers recognise the improvements to services that East Coast have made under public ownership over the last few years. They also appreciate that at present, all profits are retained for the benefit of British passengers and taxpayers.
“But despite calls from Labour for these arrangements to continue in the long term, today we hear that East Coast is set to be privatised just before the next general election.”
She went on:
“Ironically if the contract is awarded to Keolis – which is largely owned by the French government – ticket revenue may well be reinvested in improved services. Unfortunately these will be services between places like Paris and Lyon or Marseille and Monaco, rather than Edinburgh and London.
“A future Labour government would allow a public sector operator to bid for rail contracts, so that passengers and taxpayers always get value for money.”
A win for Eurostar/Keolis would mean disappointment for the other two bidders – FirstGroup and a joint venture between Virgin Trains and transport company Stagecoach.
Before National Express pulled out of the franchise, a previous private operator – GNER – also ceased running the East Coast line after its parent company Sea Containers got into financial difficulties.
Mick Cash, general secretary of the RMT transport union said re-privatising the line was “ludicrous” and a “national disgrace”.
“This is pure industrial vandalism and the strong rumour that the French-state operator is in pole position to mop up this vital, strategic north/south route says it all.
“This Government is happy to have state ownership of our railways as long as it isn’t by the British state, in the interests of the British people.”
Manuel Cortes, leader of the TSSA transport union, said:
“This has got nothing to do with improving services but everything to do with sheer political spite.
“Here we have the best-value franchise, which has returned £1 billion to the taxpayer over the past five years, being sold overseas because it is a public sector success story.
“Rather than allow that to continue, the Tories would rather see it in French hands. They don’t want the voters having the chance to keep it in the public sector by voting Labour in May.”
He went on:
“We are in the absurd position that the country that invented railways, and gave them to the world, is no longer considered by the Tories capable enough to run our own railway firms.
“They prefer French, German and Dutch state railways to run them instead. ‘Anyone but the Brits’ seems to be their vindictive attitude.”
Source – Newcastle Evening Chronicle, 25 Nov 2014
Railway workers and supporters are to protest at an event staged by a privateer bidder for Britain’s only publicly owned intercity rail service.
Eurostar/Keolis wants to take over East Coast — Britain’s most efficiently run and profitable rail service.
It was taken back into public ownership in 2009 when profiteers proved incapable of operating it.
Under public control it has provided about £800 million to the Treasury.
But the Tory-Lib Dem coalition plans to hand it back to the private sector before next year’s general election.
Rail unions RMT and TSSA will demonstrate when Eurostar/Keolis stages a presentation in Newcastle.
The protest takes place outside the banqueting suite at Newcastle’s Centre for Life at 12 noon on Friday April 11.
RMT acting general secretary Mick Cash said: “Privatisation has been a disaster for Britain’s railways. They now cost between three and four times more in taxpayer subsidy than the publicly owned British Rail.”
Source – Morning Star 03 April 2014
Protests have been taking place across the country against the Government’s controversial plan to sell off the East Coast Main Line.
Campaigners gathered at stations up and down the line – including York, Durham and Newcastle – to greet travellers and press home their argument.
The protest by Action for Rail was deliberately timed to co-incide with the beginning of the Liberal-Democrats’ spring conference in York this weekend.
The campaign, backed by the TUC and railway unions, is fighting the Government’s proposals to re-privatise the route – the only remaining publicly-owned railway in the UK.
It has been in public ownership since 2009, after two previous private train operators were forced to bail out of the franchise for financial reasons.
But last October ministers announced plans to re-privatise the line and more than 60 MPs have since signed an early day motion calling on the government to keep the line public.
The campaigners argue that Directly Operated Railways – the public operator of the line – has achieved record levels of customer satisfaction and provided the highest returns to the taxpayer while receiving the lowest public subsidy among all the train companies.
TUC general secretary Frances O’Grady said: “Privatising the East Coast defies all logic. Since it was re-nationalised the line has gone from strength to strength.
“This decision shows the government is clinging on to its outdated faith in privatisation at all costs and is determined to remain blind to the fact that public ownership has been a success for taxpayers and passengers alike.”
Source – Northern Echo, 07 March 2014