§ Mr. Watts
[pursuant to his reply, 5 February 1996, c. 8]: On Thursday 8 February, the chairman of British Rail informed me that the British Railways Board had redeployed the managing director and finance director of LTS Rail. Their decision followed the completion by British Rail's internal auditors of an investigation into alleged ticket irregularities in the company. The investigation found no evidence that they had any involvement in the irregularities. Nevertheless, in the circumstances, the board believed that senior management changes were necessary.
In the light of this decision, the franchising director has told me that he will not proceed with the completion of the franchise agreement. It remains his intention to transfer the LTS franchise to the private sector as soon as practicable, and he intends therefore to give previously 375W shortlised bidders the opportunity to re-tender for the franchise. Consequently, a franchise agreement and other relevant documentation for LTS Rail will be placed in the Library once it has been completed.
I have consistently made it clear that irregularities of the sort which occurred on LTS Rail are completely unacceptable in either the public or the private sector. I welcome the fact that the systems put in place detected these irregularities so quickly and that the British Railways Board has taken decisive action.
I share the franchising director's desire to see an early transfer of the LTS Rail franchise to the private sector on terms which satisfy his rigorous requirements and those of the Rail Regulator.