Plans for a new fleet of intercity express trains that would provide 21st-century travel for rail passengers, as well as safeguard and create up to 12,500 jobs, have fallen apart amid acrimony.
Lord Adonis, the Transport Secretary, has cancelled his much-vaunted proposals for a £7.5 billion fleet of fast trains to replace the 20 to 30-year-old former British Rail rolling stock that carries rail passengers from Paddington to the West Country and Wales and from King’s Cross to the North East and Scotland.
Lord Adonis blamed the City for not backing the plan financially. He said that a deal could not be done ahead of the general election, despite awarding the contract on a preferred bidder basis a year ago to Hitachi, the Japanese train manufacturer that built the new Javelin high-speed trains from St Pancras to Kent, in league with John Laing, the rail infrastructure firm, and Barclays.
The plans to sign the contract have foundered on the detail and funding.
The new intercity express procurement programme was launched three years ago. In awarding the deal last year to Hitachi, Geoff Hoon, Lord Adonis’s predecessor, caused controversy because it snubbed Bombardier, the Canadian engineering group that is the only British-based train manufacturer.
Unions were mollified when Mr Hoon said that he expected a new train manufacturing plant to be built in Ashby-de-la-Zouch in Leicestershire, Sheffield or Gateshead. With depots around the country, he said that the new venture could be expected to support 12,500 jobs.
Lord Adonis said: “Over the course of the procurement there has been a reduction in the capacity of the debt market to support the transaction as originally envisaged, and passenger growth has also slowed. In addition, the Government and Network Rail have committed to electrify the Great Western Main Line from 2016. The Government has identified appropriate adjustments to the original programme to take account of these developments. This has inevitably extended the contractual negotiations, which are not yet complete and would not be so until mid-March at the earliest.”
The Transport Secretary said that because the negotiations were for a multibillion-pound deal spanning nearly 30 years, the Government did not believe that it would be appropriate to enter this contract shortly before an election.
Lord Adonis said that he had asked Sir Andrew Foster, former controller of the Audit Commission, to provide an independent assessment of the programme’s value for money and the viability of any alternatives that still met its objectives.
“It is critical for rail passengers that the right long-term decision is made about the next generation of intercity trains, which will have a life of 30 years or more,” Lord Adonis said.
“The existing rolling stock dates back to the 1970s and needs to be replaced. If Sir Andrew reaffirms that the intercity express programme is better than the alternatives, my intention would be to proceed with the project in the next Parliament, subject to satisfactory resolution of all the contractual issues.”
Agility Trains, the consortium comprised of Hitachi, John Laing and Barclays said that it had “worked hard” to meet the Department for Transport requirements and said that it was “disappointed” by the decision to abandon the project.
Theresa Villiers, the Shadow Transport Secretary, delivered a withering verdict on the decision. “The intercity express programme has been blighted by Government incompetence at every turn,” she said. She blamed the Department’s “micro-management” of the scheme for huge cost inflation on the project.
Anthony Smith, chief executive of the rail customer watchdog Passenger Focus, said: “Passengers desperately want to see these new trains with more seats and a more comfortable journey in service as quickly as possible.
“We hope that whichever party is in power after the next election will pick up these plans and move the project ahead as quickly as possible.”