By Daniel Hunter

The government's decision to award a franchise to transport company FirstGroup has lead to Virgin Trains starting legal action.

Virgin, who have had the first franchise since 1997, have launched court proceedings having lost to FirstGroup. They have also demanded a review of the process.

On the day that government Transport Secretary Justine Greening said that there would be no delay in signing the contract, Labour have urged the government to delay the signing of the contract so that MPs could examine it.

"We are left with no choice but to commence court proceedings as we believe the procurement process has ignored the substantial risks to taxpayers and customers of delivering FirstGroup's bid over the course of the franchise," a Virgin Trains statement said.

"In addition, it has ignored the DfT's own assessment that VTL's [Virgin Trains Limited] bid was more deliverable and a lower risk. We question whether FirstGroup's bid has been correctly risk-adjusted by the department given all of its supposed incremental value is delivered after 2022.

"The current process is geared to selecting the highest-risk bid and needs to be independently audited to prevent a repeat of former franchise failures."

Join us on
Follow @freshbusiness