Wales and Borders rail franchise delay 'could cost £3.5m'

Arriva was awarded the all-Wales rail franchise in 2003

The UK Government should pick up the bill after causing a month-long delay to the search for a new train operator, Wales' economy secretary has said.

Ken Skates said the Welsh Government could lose £3.5m due to a change in the Wales and Borders franchise timetable.

Further delays could cost "tens of millions" more and would be a "huge inconvenience for passengers", he said.

The franchise is currently run by Arriva Trains Wales and a new contract is due to start next year.

It does not include the main line to Paddington.

Four companies have been shortlisted for the franchise and for the right to create and run a new south Wales Metro system.

Ken Skates says there are "substantial risks and consequences" from the delay

A tender was due to be issued by the Welsh Government on 18 August, but Mr Skates said the Department for Transport in Whitehall had delayed it until 26 September.

In a letter to Transport Secretary Chris Grayling, Mr Skates says he cannot proceed without the UK Government's agreement because it has not devolved the powers to Wales.

Listing the potential cost - including paying staff "to effectively stand still" - he writes: "I would welcome your proposals for how you intend to compensate Welsh Government for this additional expenditure."

The UK Department for Transport has been asked to respond.