FirstGroup's West Coast bid to be investigated
You may well be stood there, resplendent in your FirstGroup trainers with your FirstGroup umbrella, but it isn't time to start blowing up your FirstGroup balloons in celebration yet. That's because all is not hunky dory with their takeover of West Coast rail.
In fact, MPs and the like want to scrutinise the whole thing.
The Public Accounts Committee (PAC) and the Transport Committee are looking at FirstGroup's bid because they're pointing at figures that show that taxpayers won't see substantially higher payment until March 2022, which is crap.
Margaret Hodge, PAC chairman, said she was worried that, after all that bidding fiasco concerning the East Coast line, the Department for Transport (DfT) had been "over-optimistic about passenger numbers and economic growth. There is no evidence to us that the DfT has changed its spots on any of this," she said. "It would probably be legitimate for us to look at the process they have engaged in on this bid."
FirstGroup offered £13.3bn (cash!) for the West Coast against Virgin's £11bn. Alas, analysis shows that, while FirstGroup offered £45m more during the first three full years, the taxpayer would have actually been better off with Virgin in each of the next five by as much as £135m.
A senior rail figure told the Telegraph: "If this is what the DfT is looking for, all people will do is bid a big number and load it to the end. If you get it right you make a lot of money. If you get it wrong, you walk away. They’re encouraging you to be unbelievably cynical."