West Coast deal on hold after Virgin challenge

UK Political Editor

Tuesday 4 September 2012

FIRSTGROUP'S £5.5 billion 13-year deal to run the West Coast Main Line is on hold because of a legal challenge by Virgin Rail.

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MICHAEL SETTLE UK POLITICAL EDITOR

The UK Government announced the move last night, confirming "the competition remains live". However, Transport Minister Theresa Villiers insisted the Coalition intended to "defend robustly" its decision to hand over Britain's most lucrative franchise to First West Coast, a subsidiary of the Aberdeen-based FirstGroup.

The agreement was to have been signed last week but Virgin chief Sir Richard Branson made it known at the 11th hour that his company, which has run the Scotland to London line since 1997, was seeking a judicial review to challenge the Government's decision. It queried First West Coast's promises of more trains, lower fares and refurbished stations. The Scottish-based company insisted it had won the franchise "fair and square".Labour complained the contentious deal had been sealed during the parliamentary recess and wanted a delay so MPs could scrutinise the details.An e-petition on the Downing Street website, calling for the Government to reconsider the First West Coast deal, has now topped 167,000.But, in a written ministerial statement, Ms Villiers said: "The commitments in First West Coast's bid represent significant improvements for passengers and will provide a good return for the taxpayer."As a result of a legal challenge, which the Government intends to defend robustly, we have not yet signed the contract with First West Coast and the competition remains live."

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West Coast deal on hold after Virgin challenge

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