FRESH assurances were given to rail travellers today after new doubts were cast on the ability of GNER to continue to operate its East Coast Mainline franchise, should its troubled parent company crash.
Sea Containers Group, which is selling its ferry interests and talking with banks to stave off £1.2 billion debts, has admitted its auditors are likely to recommend it cannot go on.
So far, the group has been putting a brave face on negotiations. It stated while GNER is its wholly-owned subsidiary, the rail operator's finances are "ring fenced".
But it has now emerged Sea Containers put up a £30 million stand-by credit facility for GNER as a safety net demanded by the Government in its negotiations for the franchise last May.
Sea Containers is also guaranteeing a £10 million working capital facility for its rail company.
The figures appear in Sea Containers Group's annual report to the US Securities and Exchange Commission. They have led to some analysts asking whether this means the franchise could be in danger if Sea Containers "sinks".
GNER was today staying tight-lipped on the speculation, referring all queries to Sea Containers. But numerous attempts to get the parent company to comment proved unsuccessful.
No one, including the Department for Transport (DfT), would talk about the possibility of GNER being able - or being allowed - to negotiate a separate standby credit facility with another cash backer, should there be a worst-case scenario for the Sea Containers Group.
A spokeswoman for the DfT said she would not discuss the contents of a commercially-sensitive agreement with GNER.
She said: "The department is not going to be put in a position where it comments on the viability of Sea Containers, or a hypothetical situation.
"But you need to be aware GNER is not in breach of its franchise, and our agreement is with GNER, and not Sea Containers.
"We have a range of measures to ensure trains continue to run."
Guy Dangerfield, the passenger link manager for Passenger Focus, the statutory rail passenger watchdog, said: "There is no indication the problems of the parent company are going to impact on GNER passengers."
Updated: 09:21 Saturday, May 06, 2006
Comments: Our rules
We want our comments to be a lively and valuable part of our community - a place where readers can debate and engage with the most important local issues. The ability to comment on our stories is a privilege, not a right, however, and that privilege may be withdrawn if it is abused or misused.
Please report any comments that break our rules.
Read the rules hereComments are closed on this article