First will not take over West Coast from December

[snail]

The DfT are partly to blame, but this is yet another showcase of Branson's hideous attitude and self-worth.

No. Listening to the Transport Secretary and an ex-boss of ATOC on the radio this morning, all the blame attaches to the DfT for getting their sums wrong.

Virgin have damaged their image in my view with their over the top PR exercise, keeping quiet but calling for the judicial review would have been sufficient.

 

[F Great Eastern]

Virgin have damaged their image in my view with their over the top PR exercise, keeping quiet but calling for the judicial review would have been sufficient.

Totally agree with that

 

[Red Dragon]

I think the politicians are completely out of touch with the real world, and have amply demonstrated once again - to our cost !

 

[snail]

http://www.railforums.co.uk/showpost.php?p=1219519&postcount=2937

Oh dear Wath Yard....

But it's not been reversed. It's been thrown out, everyone gets their money back and has to try again.

 

[radamfi]

This is yet another excellent advert for outsourcing procurement to independent organisations.

Are you sure the bid evaluation was not carried out with help from external consultants?

 

[snail]

One interesting thing I noted from listening to the politicians on the radio is that the Transport Secretary, in response to the question 'will you be talking to Richard Branson' said he would speak to all relevant parties including Brian Souter. That's the first time I think I've heard his name in the context of this bid, despite Stagecoach owning 49% of VWC.

 

[Red Dragon]

No. Listening to the Transport Secretary and an ex-boss of ATOC on the radio this morning, all the blame attaches to the DfT for getting their sums wrong.


Virgin have damaged their image in my view with their over the top PR exercise, keeping quiet but calling for the judicial review would have been sufficient.

I agree with his comments re getting their sums wrong - they didn't analyse the risk and reward, and weight the bids accordingly.

Re Virgin - It's not easy to call foul without having accusations leveled at you

 

[marks87]

None of what you say is accurate.

In what way?

Patrick McLoughlin and Philip Rutnam (the permanent secretary) are being recalled to the Transport Select Committee.

Source:

Labour MP Louise Ellman, chairwoman of the Commons Transport Select Committee, described the development as "absolutely astonishing".

She said: "I'm going to recall the secretary of state and the permanent secretary to the Transport Select Committee, to question them about just what has gone wrong.

"This is really a major issue and a major catastrophe for them."

http://www.bbc.co.uk/news/business-19809717

Staff have been suspended.

Source:

Transport Secretary Patrick McLoughlin said it was "deeply regrettable" that mistakes had been made by staff within the Department for Transport. Several staff have been suspended.

http://www.bbc.co.uk/news/business-19809717

It's exposed flaws in the process.

Source:

Mr McLoughlin, who became transport secretary just three weeks ago, described the mistakes made by his department as "deeply regrettable and completely unacceptable".

He said: "A detailed examination by my officials into what happened has revealed these flaws, and means it is no longer acceptable to award a new franchise on the basis of the competition that was held.

http://www.bbc.co.uk/news/business-19809717

The Government are getting flack left, right and centre.

Source:

Labour MP Louise Ellman: "This is really a major issue and a major catastrophe for them."
...
Shadow transport secretary Maria Eagle said: "The West Coast rail franchise fiasco has yet again exposed the shambolic incompetence of this Tory-led government.

"The government's belated admission that it ran a flawed tendering process will come as a surprise to no one."

http://www.bbc.co.uk/news/business-19809717

So perhaps you could try again at explaining why it's simply a victory for PR?

 

[Deerfold]

http://www.railforums.co.uk/showpost.php?p=1219519&postcount=2937

Oh dear Wath Yard....

Wath Yard appears to have been correct - the decision has not been reversed, it has been cancelled.

 

[Monty]

This is not a good day. All Branson has done is set a precedent so now if a company doesn't win a bid, they might as well launch legal challenges. This is going to cost the railway 10 or even 100 of millions of pounds which could be a lot better spent. I fear the worst

This is my thinking, everytime a TOC looses it's franchise we may very well see a long drawn out process in the courts before any contract is signed. It's potentially damaging for the industry, the article on Yahoo! is saying that several civil servants at the DfT have been suspended and the current bidding process for other franchises up for renewal has been halted. There needs to be a swift end to this fiasco.

 

[507 001]

So you're suggesting that:

• Patrick Mcoughlin and co. are prepared to be recalled by the Transport Select Committee
• The DfT are willing to suspend and investigate staff
• The DfT are willing to accept there's flaws in the franchising process
• The government are prepared to take flack left, right and centre
• etc.

...just because Virgin's "PR muscle works stronger"?

Really?

None of what you say is accurate.

But yes, I'm saying this is a victory for Virgin's PR machine

Rubbish! Yes virgins p.r machine had a lot to do with it but you have to remember that the vast majority of the public agreed with virgin! You only have to look at the petition on the government website and how quickly that gained signatures!

If the government isn't "scared" of public opinion then we may as well live in a dictatorship. They have to listen to public opinion otherwise nobody would vote for them. Simple.

 

[Ferret]

Monty - there won't be a swift end to it. This farce will go on and on. I only hope that this is the beginning of the end for this farce of a franchising system.

 

[hwl]

There have been several allegation of corruption at DfT on this thread, I believe that highly unlikely.

However, having had significant dealings with the DfT economics unit on NON-rail matters, I would question the quality of their work. The Transport select committee both before and after the last election is aware of deficiencies there and there has already been some changes there in the summer of 2011 due to a previous non rail issue.

The core issues probably unaddressed from previous problems:
1) Not running enough scenarios through the models particularly those testing validity if assumptions
2) Only using one discount rate in modelling (i.e. inflation adjustments)
3) lack of scientific style rigour or application of common sense when looking at the what comes out of the models
4) Ducking doing difficult parts of the analysis and excluding it because it is "too difficult and time consuming"
5) Assuming others' work is accurate or valid, particularly other government departments, a classic example is using DECC's oil price projections for modelling and using the median estimate when actually oil prices have been above the high high estimate for 3 years etc...
6) under resourcing and being near the back of the recruitment queue in government for picking up economists

 

[khib70]

http://www.railforums.co.uk/showpost.php?p=1219519&postcount=2937

Oh dear Wath Yard....

 

[Monty]

One interesting thing I noted from listening to the politicians on the radio is that the Transport Secretary, in response to the question 'will you be talking to Richard Branson' said he would speak to all relevant parties including Brian Souter. That's the first time I think I've heard his name in the context of this bid, despite Stagecoach owning 49% of VWC.

Souter knows what's good for him, he knows that running is mouth off about the DfT and government could jeopardise his chances of bagging the Great Western franchise or a renewed South Western franchise.

 

[Metroland]

I think it's time we just bit the bullet.

Appreciate that the railways in their current form are going to need subsidy to run rural and off peak services and just re-nationalise. For that you would need to curtail the power of the unions.

Or, run the services on a concession basis, similar to Transport for London.

Or just let them sink or swim, but that will mean line closures.

This is all a political question and should be put to the public and parliament again.

 

[BrianTheLion]

But it's not been reversed. It's been thrown out, everyone gets their money back and has to try again.

Yes Mr First Group you can have the franchise... oh wait, no you cant...

Thats a reversal as far as Im concerned!

 

[dalmahoyhill]

Not really. It shows that his PR muscle works stronger than the civil service.

But the civil service GOT IT WRONG! Its not PR. Branson would have won the court case that is why the DofT put its hand it, it got the bidding wrong. Look i have no love for Branson but if i was in his position and thought it hadn't been a fair process I would do the same. What you are saying is he should just walk away even if he has a point? And how is that good for taxpayers if this had gone ahead? The DofT signs another franchise that again doesn't provide the returns indicated then all likely they default leaving us out of pocket.

Look at the hard facts Mr Branson made which i think are fair. First bid on the majority of its payments falling in the final 3 years of the franchise. It showed 10% growth per annum despite no one knowing what is going to happen in the next 13 years and things like the start of construction of HS2 affecting demand. That seems fishy and optimistic to me as well.

And finally he took legal action because he said First did not have enough insurance to cover the costs of defaulting. This is what the DofT have admitted.

So yes we should blame civil servants. Anyway the franchising process is a farce so hopefully we get a inquiry and a change of direction. Its like groundhog day they keep on making the same mistakes over and over.

I suggest picking up Modern Railways for Roger Fords incisive analysis on what goes on behind closed doors. The DofT comes across as grossly incompetent. At least nationalised BR was able to operate at arms length from them.

 

[Monty]

Monty - there won't be a swift end to it. This farce will go on and on. I only hope that this is the beginning of the end for this farce of a franchising system.

I agree completely, the government need to decide once and for all. If they are content with in interfering with the affairs of the railway as much as they do already they should seriously consider re-nationalisation. Otherwise they should sell it off completely and PO.

 

[dalmahoyhill]

Are you sure the bid evaluation was not carried out with help from external consultants?

i think it was but as i work for one of those pesky external consultants (not in rail thankfully) i would say we generally do what we are told by the government departments requesting our services. Often we are asked to do something daft but the problem is how much pushing back do we do? If we tell them they are being stupid we upset them and then don't win any more work. Its one of the contradictions of outsourcing. We have to politely nudge and cajole.

However in this case i would say we dont know who is to blame for the mistakes. The whole bidding system is flawed and has been since privatisation.

 

[snail]

Yes Mr First Group you can have the franchise... oh wait, no you cant...

Thats a reversal as far as Im concerned!

But not in the context of the other post you quoted. What point are you trying to make here?

 

[Realfish]

Souter knows what's good for him, he knows that running is mouth off about the DfT and government could jeopardise his chances of bagging the Great Western franchise or a renewed South Western franchise.

Do we really believe that keeping on the right side of DfT has a bearing on the awarding of franchises?

I ask, genuinely, because this is a recurring theme on these pages and in the wider media - it's something that I have also heard said at quite a senior level within the industry.

If true - there is something truly rotten and self serving in our country. Corrupt not necessarily in a financial sense but in an abuse of power.

 

[davido39]

No, it's not excellent news, for crying out loud

It shows the government are scared of upsetting public opinion (for some bizarre reason on this topic of all things) and/or are scared of Richard soddin' Branson.

If they were any kind of government, and I say this as a fully paid up card carrying Liberal Democrat for over 10 years, they wouldn't have got into this mess in the first place

A probable victory for Branson's bullying, I fear.

Erm is that not what the government is put in place for to serve the public? It's about time the Tories were put down a peg or two! I for one am happy First are not taking over West Coast, they are a bunch of cowboys who don't even know how to run their buses let alone a rail service!

 

[AndrewP]

Are you sure the bid evaluation was not carried out with help from external consultants?

Good point.

I don't believe it was but if it was and, if they made errors, then they are to blame as well and appropriate sanctions must be taken. Appropriate sanctions also need to be taken against those who were managing them

If the mistake was made by external consultants then they are laible and can (and should) be sued for the costs resulting from their mistakes.

My view is simple - those who made mistakes need to take responsibility.

 

[Ivo]

This was inevitable in my opinion. Didn't First bid in excess of £5bn? The #1 line the WCML may be, but that is surely too far. It shows no obvious awareness of future factors and for the DfT to accept as much was a serious mistake.

This is not criticism of First - just a belief that they, too, got their maths and/or strategy wrong.

And speaking of the DfT, or rather the Shadow DfT (if such a thing exists), I see the stupid one has been having a go again:

Following the cancellation, shadow transport secretary Maria Eagle said: "The West Coast rail franchise fiasco has yet again exposed the shambolic incompetence of this Tory-led government.

"The government's belated admission that it ran a flawed tendering process will come as a surprise to no one."

She called for full details to be revealed and said Mr McLoughlin should "come clean on the full cost to taxpayers of this shambles".

Yes. Which is exactly why Labour messed up on the ECML. Twice.

As has been stated previously, at least Cameron's Government have the guts to admit when they make mistakes. I remember that only on Monday I mentioned this at Uni, and got laughed at for it. Perhaps those Labourites at Uni might want to write an apology or two.

 

[Monty]

Do we really believe that keeping on the right side of DfT has a bearing on the awarding of franchises?

I ask, genuinely, because this is a recurring theme on these pages and in the wider media - it's something that I have also heard said at quite a senior level within the industry.

If true - there is something truly rotten and self serving in our country. Corrupt not necessarily in a financial sense but in an abuse of power.

I would'nt say it's a deciding factor no, but I believe you do yourself no favours to so openly criticise the DfT and goverment.

 

[AndrewP]

In what way?

Patrick McLoughlin and Philip Rutnam (the permanent secretary) are being recalled to the Transport Select Committee.

Source:


http://www.bbc.co.uk/news/business-19809717

Staff have been suspended.

Source:

http://www.bbc.co.uk/news/business-19809717

It's exposed flaws in the process.

Source:

http://www.bbc.co.uk/news/business-19809717

The Government are getting flack left, right and centre.

Source:

http://www.bbc.co.uk/news/business-19809717

So perhaps you could try again at explaining why it's simply a victory for PR?

This flack is mainly from the Labour Party (the same one who gave east coast to National Express) and the BBC which is so pro-Labour its like a branch of their press office.

 

[northwichcat]

I honestly don't know how Branson keeps saying their bid was better, yes it had advantages over the First bid but the First bid also had advantages over the Virgin bid. It's not like the TPE bids where the cheaper inferior First was chosen (Arriva had proposed 4 car DEMUs as the new rolling stock - similar or identical to the 222s, while First proposed 3 car DMUs with an option to extend some to 4 car.)

Virgin included more investment in the the track and stations than First. However, they plan to replace the Voyagers with new 6 carriage trains, while First propose ordering 11 x 6 carriage trains to work alongside the Voyagers and Pendolinos in the WC franchise. Virgin's rolling stock plan seems to potentially benefit XC passengers (through a Voyager cascade) more than their own. While the 15% reduction in Anytime fares proposed by First must be something that businesses would welcome.

 

[kylemore]

First Group's shares down 17% this morning.

Oh Goody!

I know that every second post starts with the words "I don't like Richard Branson but.....", well here's another one.

At least he built up a business in a virtual closed shop (VirginAtlantic) where others had tried and failed (Laker) even with heavy political backing.

The likes of FIRST and Stagecoach are low quality outfits handed state assets for virtually nothing during bus privatisation - a process that was basically corrupt.
These low grade bus companies should not have been allowed anywhere near the Rail industry.

Anything that does down First and Stagecoach is ok by me - Fair or Foul!

Yes and I know Bransons in bed with Souter, I hope he's holding his nose!

 

[jimm]

Rubbish! Yes virgins p.r machine had a lot to do with it but you have to remember that the vast majority of the public agreed with virgin! You only have to look at the petition on the government website and how quickly that gained signatures!

The population of the UK is 60 milion-plus. Since when have 173,999 signatures been the vast majority of 60-million plus? Hysterical, over-the-top remarks have characterised this whole episode and posts like yours are sadly typical.

And for all those posting here about how Virgin have heroically exposed the flawed franchising process, ask yourselves this - would Sir Richard have felt moved to expose those flaws if he had been named the winner, given that the franchising process is an utter lottery anyway? Something I'm sure Virgin were well aware of before they lodged their bid but said nothing about, so as not to upset the DfT.

I too think the franchising system is a mess and should be replaced with something more akin to the London Overground and Merseyrail arrangements but can we please be spared any more of this stuff about Saint Richard? He ain't a saint