Andy McDonald – 2016 Parliamentary Question to the Department for Transport

The below Parliamentary question was asked by Andy McDonald on 2016-10-07.

To ask the Secretary of State for Transport, what the cost to his Department was of each re-tendering exercise held for franchises for (a) long distance and (b) regional passenger rail services in each year since 2005-06.

Paul Maynard

Prior to the re-launch of the Franchising Programme in spring 2013, the costs of different franchising projects were not individually recorded.

The cost of each re-franchising project since the re-launch is as follows:

These figures include adviser costs (financial, technical and legal advisers), pay costs for the project team, “non-pay” costs (such as bidder day seminars, public consultations, etc), and VAT where applicable, for the duration of the procurements.

The (admin) sums invested in competent staff and advisors are dwarfed by the (Resource) SPRS benefits to the Department – £200 for every pound spent.

Notes

NOTE 1: The Essex Thameside figure represents the work done after the relaunch of the Franchising Programme. There was a significant amount of work completed prior to the pausing of the programme in autumn 2012 which is not included here.

NOTE 2: The costs for the refranchising of the Intercity East Coast Franchise were not charged to the public purse, but were covered by the Performance Bond that National Express put forward following its default of the previous East Coast contract.

NOTE 3: The figures for Northern, TransPennine Express (TPE) and East Anglia are the latest figures (as at the end of August 2016). East Anglia is still a ‘live’ project. Whilst Northern and TPE have concluded, there are still some residual costs that may affect the final figures.