Serco awarded contract to run the famous Caledonian Sleeper railway line


One of the world’s great railway journeys, the overnight Caledonian Sleeper between London Euston and the Scottish Highlands is to be operated by controversial outsourcing giant Serco.

Unions reacted with dismay at news of the award of the 15-year contract to the company which is currently at the centre of a criminal investigation by the Serious Fraud Office over allegations of overcharging.  

Serco, which runs the controversial Yarl's Wood immigration detention centre where it is also facing an inquiry by MPs into claims of sexual harassment by staff, was accused of having a “truly shocking record” in delivering public services, by the acting leader of the Rail, Maritime and Transport (RMT) union.

Passenger groups welcomed the prospect of the company’s promise to invest £100 million in new rolling stock but said they would be monitoring performance to make sure it delivered on the upgrade to include en-suite berths and a new brasserie-style club car.

Serco, which runs outsourced services in more than 30 countries including air traffic control, prisons, and back-office support, was banned from competing for Government contracts in the wake of the overcharging scandal although this was lifted earlier this year.

It already operates Northern Rail, Merseyrail and the Docklands Light Railway.

The Scottish Government, which awarded the contract, said it had “no choice” but to give it the franchise from First Group from next April. Serco said it estimated revenue to be around £800 million over the course of the deal but said it had no plans to activate a break clause in the contract which it was claimed could allow it to walk away in the event of Scottish independence.

Bruce Williamson of Railfuture, which represents 20,000 train users, said passengers would welcome the new operator provided it could deliver the service upgrade for the route which has seen a sharp increase in popularity.

“Serco has of course had some difficulties in other areas where it provides public services, but the promise of new trains with improved facilities is very welcome. I trust that the standard of accommodation will be less spartan than in some of its prisons,” he said.

The RMT union's acting general secretary Mick Cash said the company should never have been considered to run the service.

“Serco is a company that has a reputation for promising the earth and delivering quite the opposite as they seek to maximise profits and sweat their assets for every single penny piece,” he said.

Serco Group chief executive Rupert Soames said: "Serco has a strong track record of providing high quality and efficient rail services around the world, as well as experience in managing large-scale tourism-focused transport services.

"I am delighted that we can use this unique blend of expertise to transform the iconic Caledonian Sleeper into a modern, high quality hospitality service to make Scotland proud."

Robert Samson, passenger manager for the independent watchdog Passenger Focus said the franchise would herald a "new era" for travellers. "The investment in the carriages and berths, improved website, more flexible fares as well as superior hospitality should result in a much improved service from 2018," he said. 

What is Serco?

Formed in 1929 as the UK cinemas arm of the Radio Corporation of America, Serco operates a vast number of public service contracts across the world, covering everything from prisons to pathology laboratories, and nuclear facilities to Boris bikes.

Last year the Serious Fraud Office launched a criminal investigation into the company and fellow outsourcing giant G4S over claims that the taxpayer had been overcharged tens of millions of pounds for administering an electronic tagging scheme for UK offenders.

It is also facing an investigation by MPs over reports that it failed to investigate allegations of sexual assault against an inmate by a member of staff at its Yarl’s Wood immigration centre.

Serco, which reported a 62 per cent fall in annual profits last year, is also in the frame to run privatised children’s services on behalf of councils. The suggestion has alarmed critics who say it would result in it being given the power to remove children from families.

The company is already a leading contractor for welfare to work, as well as running hospitals, leisure centres, school inspection services, refuse collection and CCTV cameras. With more than 100,000 employees operating in 30 countries, Serco began its extraordinary diversification after taking over maintenance the Ballistic Missile Early Warning System at Fylingdales, North Yorkshire.

It also manages the UK Atomic Weapons Establishment. Serco is the largest non-Government supplier of air traffic control services in the world and runs Australian military bases as well the Dubai Metro and the Docklands Light Railway.

Start your day with The Independent, sign up for daily news emails
Arts and Entertainment
The Ridiculous Six has been produced by Adam Sandler, who also stars in it
filmNew controversy after nine Native American actors walked off set
Life and Style
The original ZX Spectrum was simple to plug into your TV and get playing on
techThirty years on, the ZX Spectrum is back, after a fashion
Have you tried new the Independent Digital Edition apps?
ebooksA celebration of British elections
  • Get to the point
2015 General Election

Poll of Polls

Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

Recruitment Genius: Senior Digital Marketing Consultant

£28000 - £45000 per annum: Recruitment Genius: A Senior Digital Marketing Cons...

Recruitment Genius: Assistant Stores Keeper

£16640 - £18500 per annum: Recruitment Genius: An Assistant Stores Keeper is r...

Recruitment Genius: Claims Administrator

£16000 - £18500 per annum: Recruitment Genius: This is an excellent opportunit...

Recruitment Genius: Software Developer - C# / ASP.NET / SQL

£17000 - £30000 per annum: Recruitment Genius: Developer required to join a bu...

Day In a Page

'It was first time I had ever tasted chocolate. I kept a piece, and when Amsterdam was liberated, I gave it to the first Allied soldier I saw'

Bread from heaven

Dutch survivors thank RAF for World War II drop that saved millions
Britain will be 'run for the wealthy and powerful' if Tories retain power - Labour

How 'the Axe' helped Labour

UK will be 'run for the wealthy and powerful' if Tories retain power
Rare and exclusive video shows the horrific price paid by activists for challenging the rule of jihadist extremists in Syria

The price to be paid for challenging the rule of extremists

A revolution now 'consuming its own children'
Welcome to the world of Megagames

Welcome to the world of Megagames

300 players take part in Watch the Skies! board game in London
'Nymphomaniac' actress reveals what it was really like to star in one of the most explicit films ever

Charlotte Gainsbourg on 'Nymphomaniac'

Starring in one of the most explicit films ever
Robert Fisk in Abu Dhabi: The Emirates' out-of-sight migrant workers helping to build the dream projects of its rulers

Robert Fisk in Abu Dhabi

The Emirates' out-of-sight migrant workers helping to build the dream projects of its rulers
Vince Cable interview: Charging fees for employment tribunals was 'a very bad move'

Vince Cable exclusive interview

Charging fees for employment tribunals was 'a very bad move'
Iwan Rheon interview: Game of Thrones star returns to his Welsh roots to record debut album

Iwan Rheon is returning to his Welsh roots

Rheon is best known for his role as the Bastard of Bolton. It's gruelling playing a sadistic torturer, he tells Craig McLean, but it hasn't stopped him recording an album of Welsh psychedelia
Russell Brand's interview with Ed Miliband has got everyone talking about The Trews

Everyone is talking about The Trews

Russell Brand's 'true news' videos attract millions of viewers. But today's 'Milibrand' interview introduced his resolutely amateurish style to a whole new crowd
Morne Hardenberg interview: Cameraman for BBC's upcoming show Shark on filming the ocean's most dangerous predator

It's time for my close-up

Meet the man who films great whites for a living
Increasing numbers of homeless people in America keep their mobile phones on the streets

Homeless people keep mobile phones

A homeless person with a smartphone is a common sight in the US. And that's creating a network where the 'hobo' community can share information - and fight stigma - like never before
'Queer saint' Peter Watson left his mark on British culture by bankrolling artworld giants

'Queer saint' who bankrolled artworld giants

British culture owes a huge debt to Peter Watson, says Michael Prodger
Pushkin Prizes: Unusual exchange programme aims to bring countries together through culture

Pushkin Prizes brings countries together

Ten Scottish schoolchildren and their Russian peers attended a creative writing workshop in the Highlands this week
14 best kids' hoodies

14 best kids' hoodies

Don't get caught out by that wind on the beach. Zip them up in a lightweight top to see them through summer to autumn
Robert Fisk in Abu Dhabi: The acceptable face of the Emirates

The acceptable face of the Emirates

Has Abu Dhabi found a way to blend petrodollars with principles, asks Robert Fisk