Stagecoach legal action over East Midlands railway franchise

Stagecoach, the current owner of the franchise was disqualified from re-bidding

The operator of the East Midlands railway franchise is taking the government to court after it was barred from re-bidding for the contract.

In April it was announced Dutch government-owned Abellio will take over the service in August.

Stagecoach, which was banned over pension concerns, said the government had "breached its statutory duties".

The Department for Transport (DfT) said it had "total confidence" in its bidding processes.

Ministers disqualified Stagecoach from re-bidding for the franchise - which has services running to Lincoln, Liverpool, Norwich and Nottingham - after DfT raised concerns about its pension commitments.

It was also barred from bidding for the South Eastern and West Coast Partnership franchises after the DfT said it "knowingly submitted non-compliant bids on all competitions".

'Questions unanswered'

Martin Griffiths, chief executive of Stagecoach, said the company had "no option" but to pursue legal action to examine DfT's "opaque decision-making" was scrutinised in public.

"We remain deeply concerned at [DfT's] procurement of the three most recent rail franchise competitions and the rationale behind its decisions," he said.

"Despite our continued requests for full transparency around these matters, many fundamental questions remain unanswered."

A DfT spokesman said they would not comment on ongoing legal proceedings, but added the department had "total confidence in our franchise competition process and will robustly defend decisions that were taken".

Abellio already operates five franchises, including Scotrail and Greater Anglia services between Norwich and London, and its East Midlands contract is set to run for eight years.