Having backed out of its obligations to run the East Coast Main Line, it seems remarkable that National Express will be allowed to continue running two profitable services.
The business chose to bid for the right to operate the East Coast route. It was not forced to do so.
If it submitted a tender that it then proved unable to fulfil, that is nobody’s responsibility but its own - in the same way that a rail operator which carries out all its obligations and succeeds in making a healthy profit on top is entitled to enjoy the benefits.
In other words, running a rail service carries both risks and the potential for reward, and businesses know this when they choose to bid for a franchise.
It’s only fair to point out that losses on the East Coast service appear to be a result of the recession rather than any failure on the part of National Express, but even dire economic circumstances do not absolve a business of its responsibilities.
While the arrangements which may allow National Express to keep its remaining franchises are hard to justify, most of the blame must lie with the government, not the business.
The firm’s plans to run the East Coast Main Line through a special purpose vehicle may not have received much public attention in the past, but they were never a secret.
The Department for Transport knew exactly what National Express was proposing when it submitted its tender bid, and approved the arrangements.
As a result, National Express acquires immunity from a “cross-default provision” in the rail franchising system, which is designed to stop rail operators ditching unprofitable lines but keeping the lucrative ones.
The Department for Transport must surely have understood this when they awarded the franchise.
One cannot blame a business for seeking to minimise risk and maximise profit. That’s what they are supposed to do.
But the Government could have said “no”. Instead, it signed the deal.
It appears that Lord Adonis (who was inherited the situation from previous Transport Secretaries) regrets that decision, and that MPs agree with him.
That’s understandable, but the decision was made and the Government effectively agreed that National Express could quit the East Coast franchise without losing its other lines.
The Transport Committee’s report may offer a valuable warning about avoiding similar mistakes in the future.
But Lord Adonis and his colleagues will need to live with the ones they have made in the past.