No payouts to rail firms hit by bidding bungle
THE Department for Transport has announced that it will not pay compensation to the four rail companies who were bidding to take over the Great Western franchise.
The Post reported last week that the tendering process for the franchise, which had originally been intended to come into effect from April this year, had been stopped.
Current operator First, which had given notice to cancel its previous franchise deal to avoid making £800 million in payments to the Government, has now been cleared to run the trains for the next two years.
The decision was taken in the aftermath of the bungled bidding process for the West Coast Mainline franchise, which saw Richard Branson's Virgin Trains unfairly treated by the Government.
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In the wake of mistakes by the DfT all the other tender process were put on hold.
The Government then said First Great Western would continue to run trains in and around Bristol, and linking the city to London and Wales.
It was feared that the move could cost the Government £50 million in compensation payments but the DfT has moved to deny those claims.
The Post understands that FirstGroup, National Express, Stagecoach, and Arriva, a division of German company Deutsche Bahn, had been short-listed for the Great Western franchise.
The DfT said in a statement: "In keeping with the relevant invitations to tender, which made clear that bidders are responsible for their own costs, the Secretary of State does not believe it would be appropriate to reimburse bidders."