ScotRail services to be run by Scottish Government owned company
ScotRail services will be run by a company owned and controlled by the Scottish Government from March next year.
An arms-length firm will take over the train operator at the end of the current Abellio franchise, the transport secretary has confirmed.
The Dutch company has been running it since 2015 but, after sustained criticism over performance, it was told in December 2019 that it would not continue beyond March 2022.
Speaking in the Scottish Parliament, Michael Matheson said it was his belief that the current franchising system was "no longer fit for purpose".
He said the impact of the coronavirus pandemic and "continued uncertainty about pending reform" meant any franchise competition was "especially unwise" at present.
Matheson said: "The cost and risk involved would be significant and I will not divert scarce time and resources to pursue a competition which risks failing.
"I can therefore confirm that we will not hold a franchise procurement competition to secure successor arrangements for the ScotRail franchise."
He thanked Abellio for its "professional" response to the pandemic and confirmed an "operator of last resort" will run ScotRail services at the end of the current contract.
He added: "This means that from the expiry of the current franchise, ScotRail services will be provided within the public sector by an arms-length company owned and controlled by the Scottish Government.
"This will provide stability and certainty for passengers and staff. I'm placing operations of ScotRail services in public hands from the end of the current contract."
ScotRail staff will transfer to the new Scottish Government owned company with terms and conditions protected.
Matheson said: "This period of stability will provide a platform whereby we can assess the scale and pace of recovery from COVID-19 and progress options for reform, in particular my preferred model of an integrated public sector controlled railway."
The transport secretary could not confirm how long the "operator of last resort" would be in place.
The move was welcomed by opposition parties. Scottish Labour transport spokesman Alex Rowley said: "The Scottish Government could have acted on this much earlier, and it is their repeated failures that have led us to this point.
"They must now guarantee that they can get their act together and deliver a public sector operator that protects staff, delivers excellent value for travellers, and ensures our rail system is a fit for purpose, truly world-leading service in the years to come."
John Finnie, Scottish Greens transport spokesman, added: "Greens have long called for public ownership of our railways, so we welcome this progress from the Scottish Government.
"Given Wales brought railways into public ownership last year, this has been a long time coming. Nationalisation of services is just the first step towards a greener, integrated public transport system which serves communities not shareholders."