Government to take over Southeastern trains after ‘serious breach’ of franchise

Southeastern trains Photo John Horton

The government will take over running services on Southeastern trains from October 17, after a serious breach of the franchise agreement’s “good faith” obligation in relation to financial matters was identified, Transport Secretary Grant Shapps has announced.

An investigation conducted by the Department for Transport has identified evidence that since October 2014 LSER (London and Southeastern Railway) has not declared over £25 million of historic taxpayer funding which should have been returned.

To date £25 million has been recovered and further investigations are being conducted by the owning group into all related historic contract issues with LSER. Following these investigations, the government will consider further options for enforcement action, including statutory financial penalties under the Railways Act 1993.

Passengers will see no changes to fares, tickets or services.

Transport Secretary Grant Shapps, said: “There is clear, compelling and serious evidence that LSER have breached the trust that is absolutely fundamental to the success of our railways. When trust is broken, we will act decisively.

“The decision to take control of services makes unequivocally clear that we will not accept anything less from the private sector than a total commitment to their passengers and absolute transparency with taxpayer support.

“Under the new operator, we will prioritise the punctual, reliable services passengers deserve, rebuild trust in this network, and the delivery of the reforms set out in our Plan for Rail – to build a modern railway that meets the needs of a nation.”

The running of services will move to the government’s in-house Operator of Last Resort (OLR) which already owns and oversees London North Eastern Railway and Northern.

Today’s decision will also have no impact on frontline staff of LSER.

In future, government will move the services back into the private sector on a new Passenger Services Contract.

South Eastern Trains franchise (by John Horton)
It was first formed in 1994, as one of many “Train Operating Units” with the lead up to the privatisation of British Rail. It took over the former Network South East Kent Coast and Kent Link route and lasted until October 1996, when Connex won the South Eastern franchise.

In late 2002 the franchise ran into financial trouble, the strategic rail authority gave a £58 million injection to bail it out, with the franchise end date brought forward from 2011 to 2006.

However, despite the cash injection, continuing poor management of its finances the SRA ( strategic rail authority) stripped Connex of the franchise in June 2003, the SRA transferred the services to South Eastern Trains the next day. The company was publicly owned and operated as Southeastern, and on April 1st 2006 they began operating the new integrated Kent franchise.

24 Comments

    • Cllr Barry, double standards? what about the tax payers money you wasted by donating to charity, which could have been better spent? You should be ashamed of yourself voting for your own increase when KCC said they couldn’t afford it and all during a pandemic when much of the electorate lost jobs. I however, wouldn’t expect anything less from a Labour member, as you bunch are so out of touch with the working electorate.

      Yes, I fully support you that southeastern should be held accountable, but so should you.

      • I gave my members grant to charities like thanet food banks and food clubs , the box says this a “waste of money “. I let you the people decide if i was right or wrong.

  1. It just shows that in these giant
    private corporations the line between profiteering and criminality is very fudged and often crossed, as it has just been with Southern Water. The sooner we get these private monstrosities back into public control and ownership, the better and more cheaply will people be served,

  2. Your damned right Dick! Privitisation of what were public services has been a disaster! I worked as an engineer with the Central Electricity Generation Board, so gained some knowledge how profits were not re-invested back into publicly owned industries, but syphoned off by various governments to be used elsewhere! This must never happen again!

    • The principal charge on a privately owned company is to make money for its shareholders. If some trains run, or sewage is treated, or gas heats our homes, so much the better.
      It was not a good day for ordinary folk when Thatcher (the milk snatcher) started privatising public infrastructure projects.

      • Thatcher Pole Tax, Blair Taxed Pensioners.
        It doesn’t matter which Party Governs, it’s the people who have to pay. They decide, we pay.
        However, this revelation is tantamount to scandal.

    • Incidentally, I know someone who works on South Eastern, and he tells me that now, employees will no longer get free travel for themselves or family! Thats a useful perk, when I worked for the CEGB we got 15% off the purchase of electrical goods from SEEBoard shops, remember them!

  3. and after what happened to those young people at a railway station at the weekend perhaps that might have some proper security and cameras , but as soon as something costs money around here you can forget about it , its different of course if its for the ” arts and culture ” nonsense

    • Sad ‘real world’ that never watches a film, never goes to a concert, has never bought a locally-made postcard, or even read a book. Well, no, that’s unfair. How about replacing ‘never watches, etc.’ with ‘never pays for’.

    • I’m surprised and concerned about the Westgate incident, not only for the poor young man who was so badly injured ( I wish him a speedy recovery) but the station boasts CCTV so begs the question, who was monitoring the screens or who should’ve been doing so?

  4. Good news: South Eastern is taken back into public ownership.
    Bad news:Nationalised South Eastern say that the service will remain the same!
    If skulduggery has taken place at South Eastern, its running mate Southern, must be in the same position, as they are owned by the same outfit.
    Can we bring TDC into public ownership as well!

  5. What a pity the government did not take Southern water back into public ownership for poisoning our coastal waters for years. That would have been the best punishment, as it is SW were fined £90 million that the customers will end up paying the water bills have already increased.

  6. Ironic that Grant Shapps has re assured us that we will see “no difference” in the service now that SE Trains has been de-privatised and returned to public ownership. I mean, didn’t they assure us that privatised companies were BETTER than publicly-owned ? But now they are admitting that, at least, there is no detectable difference for the travelling public (though I suspect that fares could be brought down as we will no longer have to pay the exaggerated incomes and perks/bonuses for the top-managers.)
    Or, else, we can expect more money to be available to improve the service , particularly increasing the number of high-speed trains coming this way.
    Unfortunately, as usual, like the Blair government did with Eastern Rail, the service will be taken over by the state, public money will be spent putting the ramshackle structure back together again, and then it will be handed back to a conglomeration of sharks from the City of London who have re-named themselves something like “Kent Railway And Passenger Provision” (KRAPP), and off we go again on the ,literal, gravy train.

  7. Rookie error by the previous owners of Southeastern. They should know, that when in receipt of large amounts of tax payers money you should make sizable donations to the Tory Party – that’s what the others do.

  8. Reading all the cynical comments here, I am surprised that nobody has adressed the elephant in the room…. What the hell happened to the missing £25,000,000?

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