Department for Transport accused in report of not learning lessons from previous failures

This article is more than 2 years old

This article is more than 2 years old

The rail franchising system is broken and passengers are paying the price, a cross-party committee of MPs has concluded.

A scathing report by MPs on the public accounts committee said the government’s management of two major franchises was “completely inadequate”.

The MPs accuse the Department for Transport of “failing to learn the lessons from previous failures” in allowing Stagecoach-Virgin to overbid for the East Coast franchise, which the government expects to terminate imminently, with the operator unable to meet payments.

The PAC report also says the department was too ambitious about what could be achieved on the Thameslink, Southern and Great Northern franchise – operated by the Govia joint venture between Go-Ahead and Keolis – overlooking the state of the railway infrastructure and failing to engage with unions.

Strikes have continued intermittently for two years on Southern. The MPs suggested the department “chose not to see the perfect storm of an ambitious upgrade programme coupled with plans to increase driver-controlled operation of trains”, leading to passengers “suffering an appalling level of delays and cancellations”.

The PAC warned the transport secretary, Chris Grayling, against re-awarding a new deal to the Stagecoach-run Virgin Trains East Coast, saying it was “concerned that the department could terminate its contract … yet still give the operator the opportunity to run the franchise again in the future”.

The committee added that the limited number of potential bidders to run train services highlighted what it called “the broken model of franchising”.

The PAC chair, Meg Hillier, described the wider Southern franchise as “a multifaceted shambles causing untold misery for passengers”, while she said “wildly inaccurate passenger growth forecasts” had brought down East Coast.

A DFT spokesperson said the report was imbalanced and disappointing, adding: “The delay and disruption Southern passengers experienced due to strike action in 2016 was unacceptable but services have improved dramatically and a brand new programme will begin next month bringing further improvements to their journeys.

“Our franchising model already puts passengers and taxpayers first and has doubled the number of passengers using trains since privatisation.”

However, Labour said the committee had confirmed its view that rail franchising was “on life support”. The shadow transport secretary, Andy McDonald, said: “It’s time Chris Grayling pulled the plug on this discredited and disintegrating system.”