Sponsored by
Government to run rail firm
THE Government is to take over the running of the East Coast Main Line – which includes services from Doncaster to London – through a publicly-owned company.
The announcement came after ministers refused requests from struggling transport group National Express for its contract with the government to be renegotiated.
The deal had been agreed with the Department for Transport on over-optimistic assumptions before the recession – but is expected to lose more than 20 million during the first half of this year.
Transport Secretary Lord Adonis said the Government had put in place arrangements to ensure the travelling public would be protected.
The Department of Transport said all East Coast services would continue and tickets would be honoured.
National Express was contracted to pay the Government 1.4bn to run the East Coast MainLine, which runs between Edinburgh, Doncaster and London, until 2015.
But Lord Adonis said today the company had been defaulting on its payments to the Government.
He added: "The Government is not prepared to renegotiate rail franchises, because I'm simply not prepared to bail out companies that are unable to meet their commitments.
"We have a duty to step in and ensure there is continuity of service. Obviously what has happened today with National Express if highly regrettable."
National Express chief executive Richard Bowker is also to resign, the firm said today.
Mr Bowker, who joined the group in 2006, will leave at the end of August to take up a new role as head of Union Railway in the United Arab Emirates.
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Weather for Sheffield
Friday 25 May 2012
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