East Coast operator earns £208m for taxpayers

The nationalised railway company operating the East Coast main line has returned £208.7 million to taxpayers as revenues soared, fuelling the debate over plans to return it to private hands.

By The Newsroom
Tuesday, 8th October 2013, 1:03 pm

Directly Operated Railways (DOR), which took over the running of the key London-Scotland route four years ago, saw the figure increase by 6.6% in the year to the end of March.

Turnover increased 4.2% to £693.8 million while total sales were up by 4.2%, including ticket revenues, as well as other income such as catering and car parks.

The figures reignited the debate about the Government’s intention to re-privatise the line - with a new franchise expected to start in February 2015. They also revealed that DOR chief executive Michael Holden was paid a salary of £224,800.

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Labour and rail unions have questioned the need for re-privatisation, arguing that DOR is returning a high level of money to the Department of Transport and receives a lower taxpayer subsidy than others.

Last week it was announced that Channel Tunnel high-speed company Eurostar was bidding to operate the route jointly with French firm Keolis. The successful bidder is expected to be announced in February 2015.

Doug Sutherland, chairman of DOR, said East Coast has recorded improved levels of customer satisfaction and punctuality over the period, and it is continuing to invest.

Mr Sutherland said: “The business plan for the remainder of the franchise during 2013/14 and the first two months of 2015 will see the good work continuing, with the twin aims of ensuring a successful transfer of the business back to the private sector - in good condition, and maximising the value of the franchise achieved by the Government and the taxpayer.”

He blamed Network Rail for a spate of failures that have more recently caused delays, saying DOR remained “very concerned” about its performance.

Bob Crow, general secretary of the Rail Maritime and Transport union, said: “These figures destroy from top to bottom this Government’s case for handing the East Coast back to the rip-off merchants from the private sector.

“DOR are paying even more money back to the Treasury, in contrast to the fat profits extracted from the privatised routes, and yet the politicians are prepared to completely ignore that.”