East Coast mainline: Virgin-Stagecoach takeover 'a national disgrace'

Stagecoach and Virgin have been awarded the London-to-Scotland rail franchise in a deal which union leaders have branded "a national disgrace".

The two companies agreed to pay £3.3bn for the East Coast mainline contract and promised to invest £140m in maintenance and development over the next eight years, the BBC reports.

Transport Secretary Patrick McLoughlin said: "This is a fantastic deal for passengers and for staff on this vital route. It gives passengers more seats, more services and new trains.

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"I believe Stagecoach and Virgin will not only deliver for customers but also for the British taxpayer."

The new consortium, known as Inter City Railways, also promised to shave 13 minutes off the 4hr 22min journey from London to Edinburgh.

But the RMT general secretary, Mick Cash, described the move as "an act of utter betrayal".

"The government has confirmed that it is bulldozing ahead with the re-privatisation of the East Coast mainline," he said, adding that the move come "despite all the figures showing that the current public sector operator is handing over a billion pounds back to the British people while delivering huge improvements in service and customer satisfaction."

Britain's Department for Transport awarded the contract to Virgin-Stagecoach ahead of two other shortlisted bidders, the British FirstGroup and a joint venture between French firm Keolis and Eurostar.

The East Coast mainline, which connects London to Edinburgh, was nationalised after the previous private operator National Express suffered huge losses while managing the line and handed the contract back.

The government said that it had always intended to re-privatise the line, but the move has been "shrouded in controversy," the Daily Telegraph says.

Unions argued that Directly Operated Railways, the government company set up in 2009 to run the franchise, had been successful in running the line and should have been allowed to continue.