Govia Thameslink was handed £8.9 billion to run Britain’s biggest rail franchise. The contract didn’t require it to actually run the trains. Then COVID arrived and the same model spread across the industry — guaranteed profit, zero passengers, public money flowing to Luxembourg.
The key figures
- £8.9 billion — fixed fee paid to Govia Thameslink to run the TSGN franchise over seven years, regardless of how many trains ran
- 7.7% — of all planned services cancelled or delayed by more than 30 minutes between July 2015 and March 2017, against a network average of 2.8%
- 160 — trains a day fully or partially cancelled at peak of the Southern Rail crisis (Nov–Dec 2016)
- £57 million — rail profit announced by Go-Ahead Group during the same period
- £10 million — of the £13.4 million Southern fine that was used to buy out Govia’s performance liability until September 2018
- £51.3 million — total falsely claimed by Southeastern (Govia subsidiary) over 15 years; £25 million of which was concealed HS1 funding
- £153.9 million — paid by DfT to 12 train operators in management fees between March 2020 and March 2021, while passenger numbers had collapsed by 77%
- £310 million — total taxpayer-funded profits made by private rail operators between March 2020 and September 2022
- £950 million — paid out in dividends by the three rolling stock companies (Angel Trains, Eversholt, Porterbrook) in 2020–21 alone
- £3.1 billion — annual train leasing bill paid by operators to those same three companies
Named players
Govia Thameslink Railway (GTR) — Operator of Britain’s biggest rail franchise (Thameslink, Southern, Great Northern, Gatwick Express)
The Go-Ahead Group / Keolis — Joint owners of Govia (65/35). Keolis is itself 70% owned by SNCF, the French state-owned rail operator. British commuters’ season ticket money was therefore being used, via the Keolis stake, to subsidise French public transport
Peter Wilkinson — Department for Transport Director of Rail Franchising 2013–2016. Held a director’s seat and joint main shareholding in rail consultancy First Class Partnerships for 20 months after joining the DfT. First Class Partnerships’ clients included Govia. The DfT’s own ethics team flagged a “clear conflict of interest” in August 2014 — five months after Wilkinson awarded the TSGN franchise to his consultancy’s client
London & South Eastern Railway (LSER) — Govia subsidiary stripped of the Southeastern franchise in October 2021 after concealing taxpayer funding for fifteen years
Angel Trains, Eversholt, Porterbrook — The three rolling stock companies (ROSCOs) that own approximately 87% of passenger trains on Britain’s network. Registered via Luxembourg, Jersey and similar low-tax jurisdictions. Owned by Canadian and German pension funds, Hong Kong infrastructure, and asset managers in Israel and the UK
What the investigation found
When British Rail was privatised under John Major between 1993 and 1997, the pitch was that private operators would compete for franchises, collect the fares, carry the risk, and lose money if they ran a poor service. That’s not what was signed.
The 2014 Thameslink, Southern and Great Northern franchise — the largest in the country — was a management contract. Fare revenue went directly to the Department for Transport. Govia received a fixed fee of £8.9 billion over seven years, paid regardless of how many trains ran. From July 2015 to March 2017, 7.7% of services were cancelled or delayed by over 30 minutes. The network average was 2.8%. While that was happening, Govia’s parent company announced a £57 million rail profit.
The franchise was awarded by Peter Wilkinson, the DfT’s Director of Rail Franchising, who at the time owned a director’s stake in First Class Partnerships — a consultancy whose clients included Govia. He kept the stake for 20 months after joining the DfT. His own department concluded in August 2014 that he had a “clear conflict of interest”. He kept his £260,000 salary.
In 2016, the Association of British Commuters — 2,000 ordinary passengers — crowdfunded £50,000 to take the government to judicial review. They forced a £13.4 million fine on Govia. Buried in the small print, £10 million of that fine had been used to buy out Govia’s performance liability until September 2018. The fine was the free pass.
In September 2021, Southeastern — run by the same Govia ownership — was stripped of its franchise for concealing £25 million of HS1 funding. Further investigation found the practice went back to 2006. Total falsely claimed: £51.3 million. The fraud investigation was conducted by Go-Ahead and Keolis themselves, using their own auditor. Within days of the fine being issued, the same parent company was awarded a fresh six-year contract for the TSGN franchise.
Then came COVID. Passenger numbers collapsed by 77%. The government converted every franchise to a management contract overnight via Emergency Measures Agreements. Operators received a guaranteed management fee of 2% of their pre-pandemic cost base. South Western Railway went from a £4 million loss to a £28 million profit in one year. First TransPennine Express went from a £6.5 million loss to a £57 million profit. Zero passengers. Guaranteed fee.
Underneath the operators sits a layer Labour’s current nationalisation programme does not touch. The trains themselves are owned by three companies — Angel Trains, Eversholt, Porterbrook — registered in Luxembourg and Jersey, owned by Canadian pension funds, German insurers, and Hong Kong infrastructure. In 2020–21, while the government was paying £7.3 billion to keep trains running for almost no passengers, those three rolling stock companies paid out £950 million in dividends. The £3.1 billion annual leasing bill continues regardless of who runs the trains.
Sources
All sources verified live as of 13 May 2026.
National Audit Office — The Thameslink, Southern and Great Northern rail franchise (November 2017). The official audit confirming 146,000 services cancelled or delayed by 30+ minutes between Sept 2014 and Sept 2017.
nao.org.uk/reports/the-thameslink-southern-and-great-northern-rail-franchise
Public Accounts Committee — Rail franchising in the UK (HC 689). Parliamentary committee report on the TSGN failures, with sworn evidence from DfT, Network Rail and Govia.
publications.parliament.uk/pa/cm201719/cmselect/cmpubacc/689
Department for Transport — Payments to passenger rail operators under emergency agreements and National Rail contracts (updated 2024). The official record of all EMA, ERMA and NRC payments to TOCs.
gov.uk/government/publications/dft-payments-to-passenger-rail-operators-under-emergency-agreements
Office of Rail and Road — Rail industry finance (UK) 2020–21. Independent regulator’s confirmation of the £153.9 million paid to 12 operators during the pandemic.
dataportal.orr.gov.uk/media/2036/rail-industry-finance-uk-statistical-release-2020-21.pdf
Department for Transport — Govia Thameslink Railway franchise agreement (June 2014). The actual franchise contract documents on the public register.
gov.uk/government/publications/govia-thameslink
Association of British Commuters — Judicial review documentation and Peter Wilkinson investigation. The passenger campaign that forced disclosure on the Southern crisis.
abcommuters.com
Association of British Commuters — Fifteen years of fraud: allegations against The Go-Ahead Group have doubled in scale (Feb 2022). The full account of the Southeastern fraud, including the original Bureau of Investigative Journalism work on Wilkinson’s conflict of interest.
abcommuters.com/2022/02/28/fifteen-years-of-fraud
The Guardian (via Bureau of Investigative Journalism) — Rail franchise mandarin’s board gave Southern contract to client of his company (Lucas Amin and Rob Evans, 11 January 2017). The original report on Wilkinson’s conflict of interest at First Class Partnerships.
theguardian.com/business/2017/jan/11/rail-franchise-boss-peterwilkinson-gave-southern-contract-client-consultancy
Kent Online — Govia hit with £23.4m fine over Southeastern financial scandal (March 2022). Full reporting on the Southeastern fraud fine, including the official DfT statement.
kentonline.co.uk/kent-business/county-news/train-operator-hit-by-huge-government-fine-264120
Ian Visits — Former Southeastern franchise fined for hiding HS1 funding. Detailed technical breakdown of how Southeastern concealed the money.
ianvisits.co.uk/articles/former-southeastern-franchise-fined-for-hidding-hs1-costs-52919
International Railway Journal — New emergency contracts spell the end of Britain’s franchising system (Sept 2020). Industry reporting on the structure of the ERMAs and the maximum 1.5%–2% management fee.
railjournal.com/news/new-emergency-contracts-spell-the-end-of-britains-franchising-system
Bring Back British Rail — Campaign to Keep Southeastern Public. Background on the Southeastern franchise structure and ownership.
bringbackbritishrail.org/franchises/integrated-kent
What you can do
Practical action from the full investigation:
- Claim Delay Repay every time you’re delayed 15+ minutes. Most people never do. Operators are sitting on up to £100 million a year in unclaimed compensation. Five minutes online, 28 days to claim, evidence is everything
- Watch for P-coding. If an operator removes a train from the timetable the night before, you still have a Delay Repay claim — document your original journey plan
- Section 75. If your season ticket cost over £100 and was paid by credit card, the Consumer Credit Act lets you claim from your card provider when service consistently fails to deliver. A Southern commuter recovered £2,400 this way
- Rail Ombudsman. Free, independent, decisions are binding on operators. If a Delay Repay claim is rejected unfairly, escalate to railombudsman.org
- Write to your MP with specifics. Your route, your season ticket price, the cancellations you tracked last month, what it cost you in time, money, and in the worst cases, your job. Specific constituency casework moves political pressure