MP demands reform after franchise fiasco

Public accounts committee chairwoman Margaret Hodge demanded sweeping changes to the Civil Service yesterday after the process surrounding the franchise bid careered into the buffers.

FirstGroup was expected to take over the franchise from Virgin, which has run the London to Glasgow service since 1997.

But furious Transport Secretary Patrick McLoughlin was forced to publicly scrap the deal, saying his department had made "unacceptable mistakes."

Ms Hodge said: "It exposes in a very stark way that the present conventions on accountability between civil servants and ministers to Parliament and the public aren't working.

"We have to open up this issue of accountability so they can't hide behind lack of accountability for not telling us what the outcomes are."

Three civil servants were suspended this week after the embarrassing and costly debacle exposed serious flaws in the government's procurement systems.

And Scottish Transport Minister Keith Brown complained to the Scottish Parliament that his government had not been warned of the "shambolic" cancellation.

"I urge the Department for Transport to sort out this horrendous mess," he said.

Tax reform and anti-privatisation campaigner Richard Murphy said: "What's very clear is that the tendering system introduced by the Tories post-2010 is impossible to use.

"I've no doubt errors were made, but let's not blame the minutiae here, let's blame the people who put the system in place.

"The reality is you can't ask people to bid for 15 year contracts without either guaranteeing they'll go bust or that you overpay them - with neither party having a clue which it will be at the outset.

"There are simply too many unknowns over such a period to ask for lowest common denominator - or highest payment - bids without massive risks arising for all parties."

Former Civil Service head Gus O'Donnell, who retired last December, admitted the West Coast fiasco raised "some issues about skills in the Civil Service."