Jim Armitage: Chris Grayling’s latest tenders are heading for a train wreck

Here’s an offer: rent my flat for three years, and take on liability for all the plumbing, electrics, windows and heating repairs until 2050. Deal?

Thought not. But this is what Chris Grayling’s transport department is asking of our rail companies.

In return for eight years of running a franchise, he now insists they take on the liability for train workers’ pensions for decades. That, on top of the already enormous risks the companies take on.

In the past, firms have made heroic (OK, “deceitful”) promises and forecasts to win the tenders. But guaranteeing pensions liabilities in an industry with a £6 billion shortfall was too big a fib, even for them.

Stagecoach, Virgin and Arriva refused to pretend they’d comply, so Whitehall kicked them out.

That means British companies won’t be running the next generation of rail franchises. Does this matter? Well, yes. One of the points of privatisation was that private sector vim and inventiveness, spurred on by competition, would bring new ideas and provide better services for less. It was never intended that private firms would take on risks totally out of their control — pensions or the macro economy, for example.

National Express saw the writing on the wall in 2017 and pulled out of rail altogether. After today, we’re left with a phoney competition between a thimbleful of state-owned foreign bidders — the only ones capable of taking on the extra risks.

The Government should never have pressed ahead with this round of tenders in the first place. The Williams review currently ongoing promises to rip up the whole system. We should just put all tenders on hold until Williams reports. The rail franchising experiment, at least in its current form, is dead.