Public Accounts Committee is not confident that the Department for Transport can handle the rail commitments it has taken on.
Public Accounts Committee is not confident that the Department for Transport can handle the rail commitments it has taken on
The Department for Transport faced criticism today for its decision to buy new trains for Intercity Express and Thameslink itself.
The Department has no previous experience of leading this kind of procurement, which is usually left to rolling stock companies and train companies.
The Rt Hon Margaret Hodge MP, chair of the Committee of Public Accounts, said that the decision ‘left the taxpayer bearing all the risk’. She said:
“The Department has no previous experience of running a procurement of this kind, let alone two with a combined value of £10.5 billion […] if passenger forecasts are wrong and fewer new trains are needed in future taxpayers will have to pick up the bill.
“The only way the Department can limit this risk is by requiring train operating companies to use these new trains to run their services regardless of whether they best fit the services they would like to offer.”
Hodge, speaking as the Committee published its 24th Report of the Session, looking into train procurement, added that the Intercity Express Programme had been poorly managed from the outset.
“After Sir Andrew Foster completed a review into the value for money of Intercity Express in 2010, the original successful bidder Agility Trains came back with a revised bid that was 38 per cent cheaper than its original one. Had it not been for the Foster review, the taxpayer could have been badly ripped off.”
The Department was accused of beginning the procurement of Intercity Express trains without a clear idea of such vital information as how many trains would be needed, which routes they would run on and what form of power they would use.
The Department’s original procurement notice was for between 500 and 2,000 trains – a huge range – but in 2009 it decided to electrify the Great Western main line. This significantly changed the requirement because there was no longer a need for Diesel trains on this line.
The Committee also concluded that the Department lacked the necessary skills to manage complex requirements.
They expressed their concern that there was a very small number of senior staff with the necessary skill to oversee the process, with the result that there have been frequent changes to staff structure and continued reliance on consultants. The officer responsible for the Intercity Express programme has changed seven times since 2007.
The Committee recommended that the Department for Transport recruit more permanent staff and train new graduates in commercial skills.
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