Question to the Department for Transport:

To ask the Secretary of State for Transport, whether he has had discussions with Avanti West Coast on the reported content of an internal presentation referencing (a) the receipt of funds from the public purse and (b) conditions for the receipt of performance-related payments; and whether his Department has paid fees to Avanti to deliver services for which third-party suppliers and inspections have already been provided to deliver.

Officials have discussed this issue with senior managers at First Rail Holdings (Avanti West Coast Owning Group) and the Managing Director of Avanti West Coast. Further discussions will be taking place with Ministers.

The Department reimburses pre-agreed budgeted costs incurred by operators on a good and efficient basis.

Additionally, operators earn two types of fees. A fixed management fee and a performance-based fee. Payment of the performance-based fee is dependent on operators’ performance against contractual criteria and target measures.

One element of that performance component is the SQR Regime, which was fully implemented for Avanti in April 2023. This regime is entirely separate from the operational performance regime which incentivise the operator to manage on-time running and cancellation levels. To date no fees have been paid to Avanti under the SQR regime. The first period to be assessed to determine the Performance Fee are the scores for April to October 2023. The evaluation process for this period is underway.