The committee said even though Railfreight Distribution made a loss of pounds 64.5m in the year to March 1996 - the last full year before its sale in November 1997 - the Government could have done more to cut its losses. It should have taken action to encourage growth in rail freight before it sold the service, its report said.
When Railfreight Distribution was sold to English, Welsh and Scottish Railway Holdings (EW&S), the Government agreed to make net payments of pounds 242m over eight years, at today's prices. It also agreed to underwrite the risk of lost business should EW&S decide to discontinue its freight services through the Channel Tunnel. The report suggested the sale had undermined competition in the rail freight industry.Reuse content