Train ticket website sues Transport Secretary after making claims about 'secret' £32million agreement involving state-owned firm
State-owned London North Eastern Railway (LNER), which has been run by the Department for Transport (DfT) since 2018, was said to have recently extended a ticketing sales platform contract.
But the company did not offer rivals like Trainline the chance to bid for the 10-year-deal, it is claimed.
Trainline has alleged the failure to seek alternative bids means due process was ignored - as were the best interests of passengers and the taxpayer.
LNER reportedly awarded the contract for the central booking engine that supports its digital ticket sales to Australia's Vix Technology.
Trainline also alleges the publication of the award on the Government's website on December 23 was too opaque as it buried the news during Christmas week, limiting the ability of other parties to respond.
It comes as Trainline, who would have expected to compete for the work, has its own rival division which provides a similar 'white label' service to train operators.
The company is understood to be claiming that a direct award of the contract was not permissible under procurement law because the terms were varied in scope, duration and beneficiaries.
Given the terms of the award, the ticketing platform used by LNER, which operates between London Kings Cross and Scotland via Leeds and Newcastle, could be extended across the rail network.
However, both LNER and the DfT have denied a new contract exists saying the allegations are 'categorically untrue'.
Rail Unions have previously raised concerns about third party ticket operators like Trainline, accusing the company of being engaged in 'relentless profiteering'.
Despite the government's plans for simplification through the nationalisation of its railway, it has maintained there would still be a need for 'an innovative and competitive third-party retail market'.
Labour also ruled out establishing a national website and app to promote to promote cheaper fares in competition with the firm.
But in guidance from January it said a plan to bring together ticket websites of individual operators was now in the pipeline.
An LNER spokesman said of Trainline's allegations: 'This is unequivocally untrue. No such contract exists. Trainline is aware this is the case as we explicitly advised them as much earlier this month.'
A DfT spokesman added: 'This is completely and categorically untrue – not least because no such contract exists, which Trainline is well aware after being explicitly told as much by LNER earlier this month.
'The Department has been clear we are working industry to simplify ticketing for customers, as part of the biggest overhaul of our railways in a generation.'
Trainline has suggested it is challenging the lack of opportunity for alternative providers to bid, regardless of whether a contract has been entered into at this point in time.
The company has filed a claim at the Technology and Construction Court.
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