Cancellation of InterCity West Coast franchise competition report published

• Eighth Report of Session 2012-13: Cancellation of the InterCity West Coast franchise competition
• Inquiry: Cancellation of the InterCity West Coast franchise competition
• Transport Committee

Embarking on an ambitious, perhaps unachievable, reform of rail franchising, in haste, on the UK’s most complex piece of railway was irresponsible say MPs in their review of cancellation of the West Coast Main Line Franchise competition.

Launching a report that examines the underlying causes that led to the failure of the franchise competition, Louise Ellman MP, chair of the committee said today,

"This episode revealed substantial problems of governance, assurance,  policy and resources inside the Department for Transport. Embarking on an ambitious -  perhaps unachievable - reform of franchising, in haste, on the UK’s most complex piece of railway was an irresponsible decision for which ministers were ultimately responsible. This was compounded by major failures by civil servants, some of whom misled ministers.

Many of the problems with the franchise competition, detailed in the Laidlaw report, reflect very badly on civil servants at the DfT. However, ministers approved a complex – perhaps unworkable - franchising policy at the same time as overseeing major cuts to the Department’s resources. This was a recipe for failure which the DfT must learn from urgently." 

While the Department has already published a response to the Laidlaw report which Mr Laidlaw described as 'very encouraging', and has initiated a review of franchise policy (now being examined in a separate committee inquiry), MPs warn that a number of matters remain to be adequately resolved.

The Committee calls on the Secretary of State and the Department for Transport to:

• Explain why ministers and senior officials were misled about how subordinated loan facilities were calculated, if necessary after disciplinary proceedings against staff have concluded.
• Complete a full email capture and get to the bottom of whether or not any officials manipulated the outcome of the competition to ensure First Group were awarded the contracts.
• Provide a comprehensive breakdown of costs arising from the cancellation of the West Coast Mainline franchise competition. 

"We also want to hear from the Secretary of State  what lessons he thinks current and future ministers must learn from this episode where policy ambition  exceeded his department’s capability and resources," adds Louise Ellman.   

Further Information

On 3 October 2012 the Secretary of State for Transport announced that the competition to award the InterCity West Coast franchise had been cancelled because of the discovery of "significant technical flaws" in the way in which the procurement was conducted. The Department for Transport subsequently commissioned Sam Laidlaw and Ed Smith, both of whom sit on the Department’s board as non-executive directors, to oversee a review of what had gone wrong. Their final report was published on 6 December.