Branson takes West Coast rail franchise battle to the courts

The Government announced earlier this month that Virgin Trains had lost out to transport company FirstGroup in the bidding war to run a new 13-year West Coast franchise from December.

Sir Richard reacted angrily to the decision, branding the bidding process “insane” and threatening to end all involvement with the railways.

However Virgin Trains announced yesterday it had started court proceedings as it believed the procurement process had “ignored the substantial risks to taxpayers and customers of delivering FirstGroup’s bid over the course of the franchise”.

Virgin now hopes its legal challenge will delay the imminent final signing of the franchise contract by Transport Secretary Justine Greening.

Ms Greening said last night that she would be making her next steps known after consulting with lawyers on Virgin’s 11th-hour application to the High Court for a judicial review.

She said the Department for Transport (DfT)would defend the robustness of its contract awarding process.

Labour and the Commons Transport Committee have supported Sir Richard’s call for a delay to the signing so the matter could be properly debated.

Sir Richard said: “We had hoped that Parliament or an external review would be able to scrutinise this badly-flawed process before the franchise was signed.

“However, that opportunity would be denied if the DfT follows through with its determination to rush through the process 
before Parliament returns next week.”

He added that signing off the franchise now “ignores the wishes of more than 150,000 people who signed the Downing Street e-petition in 10 days, the Labour opposition, two important Commons committees and many backbench 
Conservative MPs who wanted debate before the decision is taken, not a post-mortem afterwards.

Sir Richard added: “We have not taken this decision lightly, but it is the only course now available to try to unravel this sorry process.”

Virgin Trains Ltd said: “We have tried for three weeks to get clarity over the DfT’s decision and to have a number of key questions answered. On each occasion we have been refused information.

“We are left with no choice but to commence court proceedings as we believe the procurement process has ignored the substantial risks to taxpayers and customers of delivering FirstGroup’s bid over the course of the franchise.”

Responding to news of the legal challenge, FirstGroup said: “We have every confidence in the DfT’s process which is rigorous, detailed and fair and in which bids are thoroughly tested.

“There has been no complaint about the process, which was carefully described in advance, until Virgin Rail Group had lost commercially.

“Our plans for the new InterCity West Coast franchise include faster journeys, new trains, more seats and more direct services from London than currently on offer.

“There will be improved wi-fi, better catering, refurbished stations, and standard anytime fares will be reduced by 15 per cent on average within the first two years.

“Our focus is to ensure a smooth transition with continuity for staff and passengers alike.

“We want to get on with delivering the many benefits and improvements we are offering without delay or disruption.”

Virgin’s legal challenge is an application for a judicial review of the decision to award FirstGroup the contract.

The firm lodged papers at the High Court in London yesterday and a hearing will be held at the court in due course.