Chairman Pip's Railway Thoughts

Rehabilitation through change of government

Posted in Business, Great Britain, Politics by Chairman Pip on 23 December 2010

It’s fair to say that the laast couple of years have not been the best for the reputation of National Express. The fiasco (one might be tempted to say “total fuck up”) that was National Express East Coast did a huge amount of damage to a company that had been, up until then, relatively well trusted with its rail franchises, especially the Essex Thameside franchise that it operates as c2c, which is regarded as one of the best TOCs in the country. The decision taken by Lord Adonis to ban National Express from bidding for any future franchises when it was forced to relinquish East Coast was thus seen as quite arbitrary and somewhat unfair. So it is nice to see that the current government are prepared to give them a second chance with the two operators that they retain (the other being National Express East Anglia); in September, the East Anglia franchise, which had been due to expire in March, was extended for another six months, with a potential further short extension to come while the government makes its decision on changes to the franchising system, while today the Essex Thameside franchise has been extended for two years until May 2013. Of course it was right that the East Coast franchise be taken away, as it was clear that National Express had gotten in over their heads with it, making a way over the odds bid. But given the corporate structure of the group, I think that it was a bit too socialist of Lord Adonis to try and take all the franchises away (which he said he wanted to do), given that they are all essentially seperate companies, with seperate management. Speaking about the six month extension of the East Anglia franchise, Dean Finch, the Chief Executive of National Express Group, said:

Clearly this would not have happened six months ago. East Anglia would have been run by DOR

Given the difficulties that Directly Operated Railways seem to be having in getting East Coast back right way up, one does wonder what would have happened if they had been put in control of a relatively successful franchise. Not to mention the dangerous precedent of having a significant chunk of the railway network back in public hands with no mandate from voters to do so, and no compensation to shareholders, which is (whichever way you look at it) unfair. So I’m glad that National Express have been allowed both to retain these franchises, and potentially bid in the future. Just don’t overreach yourselves with your next franchise bid!

“National Express wins extension to East Anglia rail franchise”
“National Express wins right to keep c2c rail line”

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