Now that Virgin Trains is out of the running on west coast after refusing to back a multibillion- pound deficit in the rail staff pension fund,
That’s the Observer.
The actual thing being that there are pension deficits. And how much should the franchisee be responsible, the franchisee running the trains today and tomorrow, for the deficit run up yesterday?
Roughly, the government’s position is that we’ll let you know. The potential franchisee’s is that we need to know today so as to be able to bid the right amount – the right amount obviously including whatever past pension costs we’re going to be asked to cover.
That not being the way The Observer covers it – the bastards.
This lack of consistency has, largely, benefited the private sector, while simultaneously undermining the rationale of the franchising system. Virgin and Stagecoach were stripped of the east coast franchise last year after admitting they could not meet the promised £3.3bn in contract payments, but were under no obligation to meet that forgone financial promise. It was the third time in 12 years that a private operator had been removed from Britain’s most prestigious rail route after failing to deliver the billions of pounds they had promised to the taxpayer.
Neither of these cases sparked much of a public outcry because, in reflection of what matters most to passengers, safety and punctuality records on east coast have not been disastrous. This is thanks to a UK-wide, multibillion-pound investment programme underwritten by the state and carried out by Network Rail, the government-owned operator of tracks and stations.
The reason they wouldn’t meet the payments? Network Rail was late – again – on that promised upgrade of the line.
Bastards is too mild, isn’t it?