West Coast Rail Debacle 'Cost Taxpayers £50m'
Taxpayers face a "significant" bill over the botched West Coast rail franchise process, a report from a government spending watchdog has said.
The Department for Transport's running of the West Coast bidding process lacked management oversight, with some staff "confused" by the system, the National Audit Office (NAO) report said.
The Government has already indicated that repaying bidding costs to the companies that competed for the franchise is likely to land taxpayers with a bill of around £40m.
Richard Branson's Virgin Trains has been handed the franchise for the next 23 months after the process that saw the route awarded to its rival FirstGroup was abandoned.
In its report, the NAO said staff and adviser costs, legal costs and money for the two reviews set up by the Government following abandonment of the West Coast bidding amounted to £8.9m.
NAO head Amyas Morse said: "Cancelling a major rail franchise competition at such a late stage is a clear sign of serious problems.
"The result is likely to be a significant cost to the taxpayer."
Commenting on the report, House of Commons Public Accounts Committee chairman Margaret Hodge said: "The DfT's handling of the West Coast franchise was a first-class fiasco."
Ms Hodge, Labour MP for Barking, said the DfT had "blundered into this major and complex competition for one of the biggest franchises in the country without even knowing how key parts of its policy were to be implemented".
She went on: "The department's conduct was characterised by haste, confusion and weak internal and external communication.
"However, the ultimate failure of this competition was sealed by a rich mix of the department's feeble and forever changing management and almost non-existent oversight."
Bob Crow, general secretary of the RMT transport union, said the final cost of the West Coast fiasco could be as high as £100m.
He said: "This cost will not be borne by the ministers responsible for this debacle.
"It will be carried yet again by the British people and will be paid for through cuts in investment and higher fares, with the train operating companies protected and cushioned in the same way as they have been since privatisation was first unleashed."
Michael Roberts, chief executive of the Association of Train Operating Companies, said: "The Government needs to grip the issues that led to the cancellation of the West Coast franchise competition.
"It must get the programme of franchising back on course and give passengers as well as train companies the confidence that new rail franchises will be awarded through a fair and robust process."
Transport Secretary Patrick McLoughlin said: "The NAO has made a number of recommendations that mirror many of the findings of the Laidlaw Inquiry in terms of the work we need to do to strengthen our organisation and the structures within it.
"I am pleased to say that we are already taking swift action on this front and I believe the plans we are putting in place to ensure future franchise competitions are conducted on the basis of sound planning, the rigorous identification and oversight of risk, and the right quality assurance, will prevent a repeat of these lamentable failures."
what do you think?
Should come out of their bonus's and mp's expenses not the taxpayer it was a government botch up not the taxpayer
Typical .. if that we're your or my 'department' we would all be sacked and replaced. Let's have some suspended wages and ministers/civil servants (ironic title) pending some transparency. You cannot expect to screw things up that badly and get away with it.
Osborne said he will save spending but no he is spending and borrowing Billions more than any Chancellor we have ever had. Starbucks should pay about 100 billion but he allows just 10 million. So Osborne is now destroying UK and in 2015 the Conservatives could lose 90% of their seats. From 2008 to April 2010 GDP increased but under Osborne it is the lowest in History. We must have a referendum to have him out.
So Labour blame the Tories, Tories blame Labour, but it makes no difference whatsoever - The fault lies with the Civil Servants who are not aligned to any party. Its not the Governments fault or the previous Governments fault - it would have been the same if the Rainbow Party had been in power.
Governments set the policy only Civil servant are paid to make it work - unfortunetly most are incapable of understanding the real commercial world hence the mistakes
Bring the whole lot back into public ownership and end this franchise farce for good.
How much is High Speed 2 going to cost the taxpayer? They have already spend millions on it and it doesn't have a viable business case. Any objections have been swept under the carpet and why, because they have decided regardless, they want the project to proceed even with a 70p loss in every £1 spend on it.
It is just a drop in the ocean at £50 million Compared to Labours fiasco of the NHS Computer that has cost £11.4 billion to date, and continues to rise at about £1 billion a year as labour signed up to a long term contract The computer system does not work
Parts of the system have worked well. But this government instead of making the IT company fix what they were contracted for wants to scrap it costing possably more to cancell and then pay someone else billions to create another c o ck up. Tory mp's/ministers would'nt be on the board by any chance.
Tory mp's/ministers would'nt be on the board by any chance. Idou bt it but possibly Blair and Brown - as it was their baby
Nothing in it for them with the original contract,I was refering to the new contracts.
bjnk wrote "Parts of the system have worked well" If I had spent Ã?Â£11 billion on something I would require it all to work well If i purchase a new car I would not expect the salesman to say to me as i drove out Do not worry about the brakes and steering - hopefully we will sort them out in the next few years But its going to cost you another 5K Would you also like to comment on Labours waste of £500 million not setting up regional fire brigade centres. A system that operates extremely well for the private sector but labour did not want to upset their core voters
TBH Michael, my first comment was realy that whatever party is/was in government they should have insisted that the IT company fixed all the problems at no further cost to taxpayers. My reason for retaliating 'party politics' is that you as per others in a lot of posts always have to have a go at Labour whether its relevent to the subject or not.
And who puts them there - the voters
Nationalise far cheaper to run tax payer / travellers will get value for money.