Britain to renationalise East Coast rail line as profits fall short

Britain to renationalise East Coast rail line as profits fall short

"I plan to use a period of operator of last resort control to shape the new partnership", said Mr Grayling.

LNER will take over the running of the line from June 24.

Virgin Trains East Coast - a partnership between Stagecoach and Virgin - was awarded the franchise for eight years in 2014.

The decision to temporarily bring the line back into public ownership is politically embarrassing for the Government, which has repeatedly defended the private franchise model for the railways.

The future of Virgin Trains East Coast has been in doubt since the Transport Secretary Chris Grayling announced in February the line may need to be taken back under government control after the franchise holder breached its contract.

Despite this, Grayling denied it was a "failing railway" and insisted taxpayers had not lost out, claiming "the route continues to generate substantial returns for the Government".

LNER will have a new board and an independent chairman, and in a departure from past practice will feature representatives of both the train operating team and state-backed track owner Network Rail Ltd., Grayling said.

This transfer could also see Transport for London incorporate more shorter-distance routes into its London Overground operation.

Trump calls undocumented immigrants 'animals'
The lawsuit claims California's policies aimed at protecting undocumented immigrants violate the Supremacy Clause of the U.S. But Trump on Wednesday declared of the wall he promised to build as a candidate: "We've made a lot of progress on it".

Because Stagecoach and Virgin are escaping some of their scheduled payments, critics said halting the franchise early amounted to "a bail-out" by the taxpayer of the private sector operators.

Stagecoach's chief executive, Martin Griffiths, said the firm was "surprised and disappointed" by the decision. "Privatised rail is broken beyond fix yet the Tories are still handing these services back to the private sector because they are wedded to a broken free market ideology".

"While reliability must continue to improve, and promised and new investments made, passengers will continue to judge services by the performance on the day of the train company and Network Rail, value for money, cleanliness of the train and crowding levels".

The government has said that it does not intend to strip Virgin and Stagecoach of the franchising passports which they hold, and thus they would be able to bid for future franchises.

Mr Grayling told parliament that Stagecoach and Virgin have lost nearly £200m, but that this had not been a loss to taxpayers "at this time".

They will operate under "one of Britain's iconic rail brands", the London North Eastern Railway, Mr Grayling said.

McDonald pointed out that the government had failed to impose restrictions on what Virgin and Stagecoach could do next, calling the statement "a smokescreen to divert attention from the failings of his policy".

GNER was stripped of the route in 2007 after its parent company, Sea Containers, suffered financial difficulties, while National Express withdrew in 2009.

Related Articles

  • Prosecutors: 10

    Prosecutors: 10 "tortured" kids waterboarded, shot with crossbow

    Warshawsky to be arraigned on charges of seven counts of felony torture and nine counts of felony child abuse Monday in Fairfield. Jonathan Allen, 29 of Fairfield (right) appears in the courtroom of Solano County Superior Court Commissioner Robert Q.
    Britain slashes top stake on gambling machines to 2 pounds

    Britain slashes top stake on gambling machines to 2 pounds

    When the Government launched policy proposals on FOBTs past year it was feared the stake could be kept as high as £30. Fellow gaming group 888 Holdings dropped 6 per cent, with GVC Holdings off 4 per cent and Playtech 2 per cent lower.
    Florida teacher accused of drowning raccoons with students

    Florida teacher accused of drowning raccoons with students

    In March, a junior high biology teacher in Idaho reportedly fed a puppy to a snapping turtle in front of students. A video of the shocking incident shot by a student who was upset about it has gone viral on social media.
  • Summary of Beazley plc (LON:BEZ) Ratings

    Summary of Beazley plc (LON:BEZ) Ratings

    The total volume of shares exchanged so far has reached 422,950 whilst the average number of shares exchanged is 551,744. Therefore 54% are positive. 16 are the (LON:AA)'s ratings reports on May 16, 2018 according to StockzIntelligence Inc.
    Ebola spreads in more cities in Congo

    Ebola spreads in more cities in Congo

    The vaccine requires storage at a temperature between -60 and -80 degrees C, tricky in a country with unreliable electricity. Oly Ilunga Kalenga said a case of the virus was detected in Mbandaka, a city with a population of about 1 million people.
    Reports on Other 'Suspicious' Michael Cohen Transactions Have Gone Missing

    Reports on Other 'Suspicious' Michael Cohen Transactions Have Gone Missing

    His Doral club, as was the case past year , dwarfed the rest of his golf properties, with revenues of nearly $75 million. Cohen's attorney Stephen Ryan did not immediately respond to a request for comment from Reuters on the reports .
  • Allan McGregor: Goalkeeper returns to Rangers on two-year deal

    Allan McGregor: Goalkeeper returns to Rangers on two-year deal

    Instead, the 36-year-old has chose to return to Rangers six years after quitting in the wake of the club's financial meltdown. He netted his first Premier League goal for Liverpool last weekend but could move in search of more regular football.
    Officially announced the continuation of the cult game STALKER 2

    Officially announced the continuation of the cult game STALKER 2

    GSC Game World has announced S.T.A.L.K.E.R. 2, the latest entry in the first-person shooter survival horror series S.T.A.L.K.E.R. These are all the details we have for now, but for S.T.A.L.K.E.R. 2 news further down the line, keep it locked here at IGN.
    Gwyneth Paltrow showed a rare photo of decheri

    Gwyneth Paltrow showed a rare photo of decheri

    The actor took to social media to wish her ex-husband on his birthday too, "thanking" him for gifting her with the two kids. Paltrow, then later paired up with producer and American Horror Story co-creator Brad Falchuk.
  • Swachh Survekshan 2018: Nagpur awarded India's Best City in 'Innovation & Best Practices

    Swachh Survekshan 2018: Nagpur awarded India's Best City in 'Innovation & Best Practices

    With Mumbai's rank dropping from No. 10 in 2016 to No. 29 in 2017, the BMC had taken steps to improve the city. It is the top 3 cities that matter the most in every year's Swachh Survekshan survey.
    Ford F-150: Production to Resume as of Friday

    Ford F-150: Production to Resume as of Friday

    The company expects production to be in full force at both plants by the end of the day Monday, a spokesperson confirmed. The fire damaged the Eaton Rapids, Michigan factory of the Meridian Magnesium group on May 2nd.
    Relocation of United States  embassy to Jerusalem heightens tensions - AU

    Relocation of United States embassy to Jerusalem heightens tensions - AU

    While addressing a UNSC meeting Riyad Mansour said that the U.S. was responsible for the Palestinian deaths. Security Council opened an emergency meeting to discuss the Israeli violence with a moment of silence.