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Why has East Coast Mainline hit the buffers again?

Why has East Coast Mainline hit the buffers again?

If a franchise is terminated or there are no acceptable private bids, the Secretary of State for Transport can take over the franchise as an operator of last resort.

It will be rebranded as the London and North Eastern Railway.

The transport secretary was under pressure to act over at least four struggling rail operators last night after announcing plans to renationalise services on the east coast main line.

Speaking in the Chamber today, Shadow Transport Secretary Andy McDonald claimed Grayling had treated the Commons with contempt by failing to provide the opposition with an electronic copy of the statement.

The collapse of a franchise awarded only in 2014 marks the third time in a decade that private companies have bailed out of running the 400-mile-route, fueling an argument over the future of the railway nearly 25 years after the network was privatized.

The Government has now been forced to take action three times since 2006 over problems affecting the Intercity East Coast franchise.

LNER will have a new board and an independent chairman, and in a departure from past practice will feature representatives of both the train operating team and state-backed track owner Network Rail Ltd., Grayling said.

It said on Wednesday it hoped to continue to play a role in Britain's rail network in the future, and continues to be involved in running other United Kingdom rail franchises including the West Coast line between London and Manchester.

Mr Grayling said Stagecoach and Virgin, as well as the financial losses, had suffered reputational damage.

The service, which links to Glasgow, Aberdeen and Inverness will be taken back into public control on June 24, a little over three years since Virgin Trains East Coast started running.

It comes after operators Virgin and Sir Brian Souter's Stagecoach could no longer meet the promised payments in the £3.3bn contract.

Scottish Liberal Democrat transport spokesman Mike Rumbles MSP said: "Stagecoach failed spectacularly to deliver on its East Coast mainline rail contract, compromising one of Scotland's most important transport arteries".

One of the fiercest critics since the decision was made in November has been Lord Adonis, who resigned as chair of the National Infrastructure Commission at the end of 2017.

He added when the franchise "was run it the public sector, it returned more than £1bn to the Treasury".

Stagecoach Group Chief Executive Martin Griffiths said he was "surprised and disappointed": "We will work constructively with the DfT and the OLR in the weeks ahead to ensure a professional transfer to the new arrangements, supporting our employees and maintaining the same clear focus on our customers as we have over the past three years".


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