Rail franchises running late

Stagecoach promises to invest in upgrading if it wins new franchise for South West Trains.

By Simon Montague, BBC Transport Correspondent

Stagecoach says it would spend £1.5bn on new trains, replacing all of South West Trains' old fashioned, slam-door rolling stock within three years.

A further £1.3bn would be spent on redeveloping the overcrowded London Waterloo and Clapham Junction stations.

The company says its aim would be to create "the best commuter network in Europe".

Scotland-based Stagecoach is fighting to extend its existing contract to run South West Trains, and beat off rival bids from Great North Eastern Railways and a joint venture of FirstGroup and Dutch Railways.

Bogged-down

GNER unveiled a £4.5bn investment proposal, including new tunnels under central London, last week.

The Government body which oversees the rail industry, the Strategic Rail Authority, is expected to decide who will win the new franchise later this year.

The Hatfield train crash has delayed re-franchising

But the entire process of awarding new contracts to Britain's train companies has become bogged down in complexity, uncertainty and delay.

The SRA announced today that it was extending the Cardiff Railways and Wales & West franchises for up to three years.

They had been due to finish at the end of March, but the authority's plans to create a new, single franchise for Wales and Borders are taking longer than originally envisaged.

On Thursday the Great Northern franchise was also extended until the new Thameslink contract is awarded.

And on Wednesday the SRA abandoned negotiations over a new franchise for Central Trains, because it said the bids were not good enough.

One reason for the delay in the re-franchising process is last October's Hatfield train crash, when the industry's regulators were diverted to deal with the chaos that followed.

But the SRA has also become bogged down by the complexity of re-drawing the rail franchise map, creating new franchise areas and reshaping others.

In a Catch-22, train operators have complained that the SRA has given insufficient guidance about its plans, while the SRA has said it is up to the companies to come forward with imaginative proposals.

Three quarters of the existing franchise contracts were due to have been replaced by June this year. The SRA says the process will now take until the end of 2001.

Some industry observers believe even that timetable is optimistic.