Virgin Trains has been rewarded the West Coast Main Line for an extra year despite the failures of the Stagecoach-Virgin East Coast franchise, Chris Grayling has announced.
The Transport Secretary issued a statement in Parliament and confirmed that Virgin would continue to operate the line, 22 years after first being awarded the franchise.
The franchise had been due to end in April, but the Government has previously announced that Virgin will run services until April next year before a new franchise was expected to be created to run the West Coast and HS2 services when the high speed line is built in 2026.
Mr Grayling added that "West Coast franchise has a completely different corporate structure" to the East Coast line and that a decision had not been reached on the successor to run the East Coast railway.
He did however add that the government was directly operating the East Coast Main Line and that the Stagecoach-led franchise would only be able to continue in its current form for a "very small number of months".
The decision to re-award Virgin the West Coast Main Line has been branded "shameful fiasco" and the government’s former infrastructure tsar, Lord Andrew Adonis claimed the decision was simply a “bail out”.
“Despite their failure on East Coast, [Chris Grayling] has given Virgin a sweetheart deal on West Coast Main Line, without competition and allowed Stagecoach to bid for future franchises and possibly also keep the East Coast contract as well! Yet more taxpayer bail-outs,” Lord Adonis tweeted.
“Cut through the waffle and yet again [Chris Grayling] is bailing out the billionaires Sir Richard Branson and Sir Brian Souter at the expense of the taxpayer,” he added.
Mick Cash, general secretary of the Rail, Maritime and Transport union said: "Rumours are rife that Chris Grayling is setting up a major "market sensitive" announcement on the West Coast Mainline and that that announcement may mean a further cash-laden extension for Virgin and Sir Richard Branson without any competition or consideration of the public sector option.
"RMT awaits the announcement and after the fiasco of Chris Grayling and the Tory Party chairmanship just a few weeks ago we know that anything is possible with this shambles of a Government.
"However, if the well-informed speculation is correct it will expose yet again the cronyism and chicanery of the privatised rail franchising process and will ram yet another nail into the coffin of this whole rotten business.
"If the East Coast bail out is to be followed by a West Coast bung the British people will be rightly up in arms and it will reinforce the cold, hard fact that it's no longer a question of if our railways will be returned to public hands, it's a matter of when."
Virgin Trains statement following Government announcement about the West Coast Mainline: "Virgin Trains customers on the West Coast will see a significant improvement in on-board WiFi later this year. All 56 Pendolino trains will undergo a refit which will vastly improve the on-board equipment, and allow free WiFi to be extended to all Pendolino customers.
"The £7.5 million investment is part of a new deal agreed with the Government, which will see Virgin Trains continue to run the West Coast franchise through to at least March 31 2019, with the option for up to a further one-year extension at the Department for Transport's discretion.
"The existing franchise expires on March 31 2018, and the new contract will bridge the gap between the existing franchise and the new West Coast Partnership, due to start on April 1 2019.
"Installation of the WiFi upgrade is planned to begin on the Pendolino fleet from May 2018, with the work expected to be completed by January 2019, when free WiFi will be extended to all Pendolino customers. More than 85 per cent of our customers travel on Pendolinos.
"In addition, the new technology is 'future-proofed' so it will work with 5G mobile phone networks as they come on stream and offer further speed improvements. The upgrade will also unlock the ability to offer more technology-led improvements in the future, all of which will increase customer satisfaction."
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