News

Virgin Trains to give West Coast rail extension profits to 'good causes'1

Fundraising | Niki May Young | 6 Dec 2012

Virgin Rail Group (VRG), which was today appointed as operator of the InterCity West Coast franchise, has pledged to give all its profits for the service to good causes.

Speaking with civilsociety.co.uk this morning Ken Gibbs, communications manager for Virgin Trains, confirmed that Virgin would "certainly stand by the pledge" to pass on its profits to 'good causes', which may include charities, he said.

The details, said Gibbs, are yet to be worked out, as the train company only discovered last night that it had been awarded a new contract to run the West Coast service until 8 November 2014.

"We've yet to work out the detail but essentially we have said we will give donations to good causes. It's not our priority at the moment, there are other things we need to get resolved first and there are some things we still need to discuss with the Department of Transport. But we will be making the position clearer once we've gotten through the next few weeks clarifying what the deal means for customers, who at the end of the day are the priority," he said.

Virgin owns 51 per cent of VRG, while Stagecoach owns 49 per cent. Stagecoach has reportedly failed to meet VRG's generosity in pledging to donate profits. Gibbs said Virgin would be in discussions with Stagecoach about this: "That's something we need to resolve with them," he said.

Some 11.4 per cent of Stagecoach's operating profit comes from its UK rail services, which includes the joint venture with VRG and the principally-owned South West Trains and East Midlands Trains services. In the financial year to 30 April 2012, Stagecoach reported an operating profit on the VRG joint venture of £15.9m, and £28.4m in the previous year.

Virgin has operated the InterCity West Coast route since 1997. Today's VRG contract announcement comes following Virgin's campaigning in the summer against the Department for Transport's decision to award a new long-term contract for the franchise to FirstGroup. Virgin successfully had the decision revoked after significant flaws were found in the Department for Transport's bidding process.

A decision on the long-term service provider will be made between now and 8 November 2014. VRG's contract may be terminated prior to that date if a long-term franchise is ready to commence before it expires.

The InterCity West Coast route runs from London Euston to Glasgow, stopping in the West Midlands, North Wales, Manchester, Chester, Liverpool and Preston.