Thursday, October 22, 2020

Stagecoach takes legal action against DfT over East Midlands Trains franchise

Stagecoach Group has confirmed that its wholly owned subsidiary, Stagecoach East Midlands Trains Limited, is taking legal action against the Department for Transport.

The group said that a claim was issued yesterday (8 May) at the High Court in London under Part 7 of the Civil Procedure Rules. The claim alleges that the Department for Transport breached its statutory duties in connection with the procurement of the new East Midlands rail franchise.

In a statement to the London Stock Exchange Stagecoach detailed: “Stagecoach East Midlands Trains Limited was disqualified from the procurement of that franchise and the DfT announced on 10 April 2019 that it intended to award the franchise to Abellio after the expiry of a voluntary 10 working day standstill period. That standstill period has subsequently been extended but is due to end at midnight today.”

Stagecoach added: “We have informed the DfT that we are also preparing a claim for judicial review of its decisions to disqualify us from bidding for the East Midlands rail franchise and to award the franchise to Abellio. Additionally, we are considering legal action against the Department in respect of the ongoing competitions for the West Coast Partnership franchise and a new South Eastern franchise.

“The Part 7 claim that has been issued and the further legal actions under preparation vary in certain respects but common to all is our refusal to accept the potential pension risks that the DfT requires operators to bear in relation to the three new franchises. The full extent of these risks is unknown but we estimate them to be well in excess of £1 billion.  Further information on those pensions risks was provided in a regulatory announcement by Stagecoach on 2 May 2019.”

Martin Griffiths, Stagecoach Group Chief Executive, said: “We remain deeply concerned at the Department for Transport’s procurement of the three most recent rail franchise competitions and the rationale behind its decisions.

“Despite our continued requests for full transparency around these matters, many fundamental questions remain unanswered. As a result, regrettably we have had no option but to commence legal action against the DfT to ensure the serious issues involved and the DfT’s opaque decision-making are subject to proper public scrutiny.

“In view of the legal action we have taken today we believe it would be untenable for the DfT to proceed to sign  any contract for the East Midlands franchise without a full and proper review of the procurement of that  franchise to help restore public confidence in the process.”

A message from the Editor:

Thank you for reading this story on our news site - please take a moment to read this important message:

As you know, our aim is to bring you, the reader, an editorially led news site and magazine but journalism costs money and we rely on advertising, print and digital revenues to help to support them.

With the Covid-19 pandemic having a major impact on our industry as a whole, the advertising revenues we normally receive, which helps us cover the cost of our journalists and this website, have been drastically affected.

As such we need your help. If you can support our news sites/magazines with either a small donation of even £1, or a subscription to our magazine, which costs just £33.60 per year, (inc p&P and mailed direct to your door) your generosity will help us weather the storm and continue in our quest to deliver quality journalism.

As a subscriber, you will have unlimited access to our web site and magazine. You'll also be offered VIP invitations to our events, preferential rates to all our awards and get access to exclusive newsletters and content.

Just click here to subscribe and in the meantime may I wish you the very best.






Latest news

Q3 pre-tax profits almost entirely offset first half losses at Pendragon

Profit before tax has jumped by over 800% at Pendragon, the Nottingham-headquartered car retailer, during Q3 of its financial year. Underlying profit before tax at...

Just a week remains until the 2020 East Midlands Bricks Awards

In just a week the 2020 East Midlands Bricks Awards will take place digitally, on Thursday 29th October. Though Government guidelines have made in-person events of the Bricks' size...

First stage of Belvoir Shopping Centre revitalisation to commence

Gylo, who acquired the Belvoir Shopping Centre in Coalville last year, has announced that following the approval of its planning application earlier this summer,...

Derby bids to become leading UK centre for future fuels

Derby has declared its ambition to become the UK’s centre of excellence for future fuel technologies, using the city’s advanced manufacturing expertise to revolutionise...

Travis Perkins continues to recover from lockdown with Q3 sales growth

Like-for-like sales grew by 3.9% at Travis Perkins during its third quarter, however like-for-like sales for the year are down 11.8%. In a statement to London...

Related news

What to consider before getting a smartphone for your home business

When you’re running a small business, it’s a wise idea to try and keep your business and personal life as separate as possible. This...

Q3 pre-tax profits almost entirely offset first half losses at Pendragon

Profit before tax has jumped by over 800% at Pendragon, the Nottingham-headquartered car retailer, during Q3 of its financial year. Underlying profit before tax at...

Just a week remains until the 2020 East Midlands Bricks Awards

In just a week the 2020 East Midlands Bricks Awards will take place digitally, on Thursday 29th October. Though Government guidelines have made in-person events of the Bricks' size...

First stage of Belvoir Shopping Centre revitalisation to commence

Gylo, who acquired the Belvoir Shopping Centre in Coalville last year, has announced that following the approval of its planning application earlier this summer,...

By continuing to use the site, you agree to the use of cookies. more information

The cookie settings on this website are set to "allow cookies" to give you the best browsing experience possible. If you continue to use this website without changing your cookie settings or you click "Accept" below then you are consenting to this.

Close