Saturday, 18 August 2012

The First or Last Time?

Ever since Victor Meldrew uttered the immortal phrase "I don't believe it", battle-weary Brits have borrowed it to express their incredulity at a situation. Or merely as a substitute to a sigh.
There's been much observing this week in the railway world at the news of FirstGroup's trumping of Virgin for the West Coast mainline franchise. Much of it centered around the Meldrew phrase - even seasoned commentators wondering just how the Barbie operation could promise the Earth to the passenger and the taxpayer more gold at the same time.
I recall the early days of rail privatisation back in the 90s. The railways had yet to hit their "golden" period. The West Coast mainline was as popular as the famous old BR sandwich. Virgin had "mission impossible" to achieve, but Branson and co were up for the challenge. In a strange combination of the man responsible for introducing the World to "Tubular Bells" and the rags-to-riches busman Sir Brian Souter, Virgin Trains helped to change the face of travel on the WCML. From 10m passengers per year in 97 to 31m today, tilting high-speed Pendolinos replacing stock inherited that was over 30 years old, and a 91% customer satisfaction rating, few would argue that Virgin Trains did good.
FirstGroup, however, are offering candy. More of it. 11 new 6-car electric trains. Major refurbishment of the current fleet. Free wi-fi. New routes from Blackpool (from 2013) and Shropshire to the capital (planned from 2016). Cuts of 15% for some "walk-up" fares. The promises roll on.
Tim O'Toole, FirstGroup's CEO, is a shrewd operator. Since taking control of the transport giant in turbulent economic times, he would appear to know what he's up to. The bus division - long seen as being in need of serious review - is far from being out of the woods in that respect. But the challenge is being taken up, and I believe that, in the long-term, First's buses will improve. The Group's rail operations - including the long-distance Great Western - have inevitably had their critics, but have settled down.
So why do we view the awarding of the WCML franchise to FirstGroup with such suspicion and, in some parts, outright derision?
Have we seen this all before, particularly on the other side of the country, with the East Coast? GNER handed the keys back early, followed by a similar tale of woe from National Express. Maybe we can't exactly see how First can deliver all of these promises of better services, given the ambitious promises of much higher premiums back to the taxpayer. Does Branson have a point, or is he merely a sore loser? Has Tim O'Toole a brilliant masterplan that can deliver over the next decade and beyond, or has he ambitiously overbid? Make no mistake, this is a gamble for both FirstGroup and the Department for Transport.
The incredibly complicated world of railway franchising is not for the faint-hearted. It has already resulted in the East Coast having to be retaken back into public control following the disastrous National Express tenure, although one could argue that the breaking of the economic crisis put paid to the over-ambitious aspirations of Richard Bowker's outfit at the time.
Nevertheless, this is arguably an even bigger risk for FirstGroup. Fail with this one and there will be nowhere to hide. Both for them and the DfT. It would be no consolation for Branson to shout "I told you so" from the sidelines. As for the Government, the DfT's reputation would be in tatters.
But many are predicting a fait accompli. Just because it's happened before doesn't mean it's necessarily going to happen again. Challenging? Definitely. Achievable? Quite possibly.
We must hope, ultimately for passenger's sake, that First and the DfT have got it right this time. Or it could be the last time we see such examples of ambitious bidding for such a big prize.

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