Posted 13th November 2012 | 8 Comments
DfT crisis deepens as union appeals to Europe
The DfT wants Virgin to continue as West Coast operator from 9 December, but the negotiations have become protracted
THE GROWING CRISIS at the Department for Transport over the West Coast franchise collapse and an apparent stalement over rolling stock procurement has taken a new turn, because the DfT now also faces a union challenge under European law.
The RMT said its solicitors are petitioning the European Commission with an allegation that procurement rules are being broken.
The Department has been locked in talks with Virgin Trains for almost a month about an emergency contract to keep West Coast trains running from 9 December, but so far no terms have been agreed. Industry insiders claim the DfT is in serious trouble because Virgin is the only practicable bidder and is apparently taking a tough stance.
Transport secretary Patrick McLoughlin announced on 15 October that the DfT wanted Virgin to carry on in the short term, for a period of between nine and thirteen months. He had cancelled the award of the West Coast franchise to FirstGroup at the start of the month because the DfT's processes had been revealed to involve serious flaws. Three civil servants were suspended.
The DfT intends to award two further West Coast contracts after the initial period of emergency operation is over. The first would be a short franchise of perhaps two years, to be followed by a long-term arrangement which could run until about 2026.
However, the RMT has now launched an all-out attack on the official plan to keep Virgin as the West Coast operator for the time being, claiming that by doing so the Department has breached the EU's Consolidated Directive on Public Procurement.
The union's general secretary Bob Crow said: "The current West Coast staff could have three bosses in three years with all of the uncertainty and potential for cuts to jobs, working conditions and pensions that are thrown in the mix at every twist and turn. That’s not job security, that’s gambling with people’s working lives in the name of private profit.
"If RMT, or any other union, sought to flout laws and regulations in the way that the Government are proposing over the West Coast lash up we would be dragged into court like a shot. RMT will not sit back while our members are hung out to dry by this franchise fiasco."
The DfT's difficulties are multiplying. Not only are West Coast intercity services currently in the balance, but the pivotal Thameslink rolling stock contract is also thought to be spiralling out of control, because preferred bidder Siemens has yet to confirm external funding for the £1.4 billion deal.
The Government has tried to compensate for the financial crisis in the Eurozone by including funding guarantees in its proposed Crossrail rolling stock contract, but it cannot do this retrospectively for the new Thameslink trains because such a move would also breach European procurement law. Ministers have repeatedly claimed that financial close is imminent, but deadlines have moved back several times. The latest position, which has been supported by Siemens, is that the deal is now expected to be confirmed early in 2013.
The DfT had defended its handling of the Thameslink contract after suggestions that it had been tainted by the West Coast flaws, saying that the two processes were different, but it has now emerged that two of the three suspended West Coast civil servants were also involved in the Thameslink calculations.
An inquiry into the West Coast problems headed by Centrica boss Sam Laidlaw is due to present its final report at the end of the month.
Reader Comments:
Views expressed in submitted comments are that of the author, and not necessarily shared by Railnews.
lorentz, London
The RMT has all the time to spend on issues that do not concern it, or to push inferior British products, but does not appear to do a very good job of defending its own members.
Leslie burge, leicester
Why Can't Virgin run both short term contracts until its all sorted out.
Philip Russell, Carlisle
Its tragic the DFT has made such a mess of the railways lately but i also dislike the pointless moaning from Bob Crow and his union , Virgin staff are amongst the best paid in the industry and their conditions will be protected anyway on transfer to a new company ,yes it will be mildly annoying having to get new uniforms etc but with millions jobless right now i can think of far worse problems to have
Paul, Birmingham
If Bob Crow was doing anything but acting on his own agenda and actually asked Virgin employees and his members what they want he would realise we want to stay Virgin employees and do not want to be nationalised.
What does he think nationalisation will do? All duplicate jobs, of which they are many, will be cut, there will be a massive cuts. Why would we want that numpty!
Melvyn Windebank, Canvey Island, Essex
While the franchise and rolling stock deals come under different headings the fact that Siemans have still not raised funding for the Thameslink trains begs the question as to why a time limit is not put on bids to ensure that over bids or bids based on infair rules (remember Siemens is also a bank and so has better credit worthiness!! than simple train builders.).
Perhaps the model as used on London Overground needs to be adopted for Thameslink with a Directly Operated Trains of DFT being set up.
James Palma, London
Oh dear, Bob Crow is ranting again. Just to point out to him that most people are of the opinion that Unions do often flout the law and they also appear to believe that the current scenario is best for the West Coast Main line. I do wish some one would tell him to shut up.
Jim Campbell, Birmingham
The job of a union is to represent its members so has Bob Crowe asked his members, who work for Virgin, if they want this action. Probably not as most of them would be very happy to remain Virgin employees.
Lee, Manchester
Given the current turn in events at the DfT, one has to wonder whether the 'problems' associated with this department are limited to the DfT or sympomatic of issues in other government departments, which haven't yet come to light. If they aren't, then surely there should be a review/inquiry into the working practices of the DfT? How much has/is all of this costing the tax payer at a time when the Government wants to increase duty on fuel?