Arriva trains will keep running until December

SercoNed should have taken over all local services between Lincolnshire, Merseyside and the Scottish border on Sunday.

The firm will now begin operating on Sunday 12 December.

SercoNed could also take over some Central Trains lines in the Midlands when that franchise ends in 2006.

Transport Secretary Alistair Darling announced on Tuesday that the 25 UK rail franchises will be reduced to 19. The consolidation is part of efforts to "streamline" and improve the industry.

Investment 'disappointing'

The Strategic Rail Authority said the SercoNed franchise would last nearly nine years, with the last two years depending on the company achieving targets such as reducing cancellations and delays by 15% in the first five years and improving station maintenance.

A subsidy of nearly �2.5bn, at 2004 prices, would be paid over the franchise period, the SRA confirmed.

Roy Wicks, director general of the South Yorkshire Passenger Transport Executive, said he was pleased the franchise terms had finally been agreed.

But, he added, it was "disappointing that the funding for the northern rail franchise does not currently provide for the level of investment needed to modernise and develop our commuter rail networks."

This does nothing to bring about a joined-up railway Bob Crow, RMT

SercoNed - a joint venture between the Serco services business and Netherlands Railways - may also now be in the running to take over more routes in the Midlands when the current Central Trains franchise expires in 2006.

Details of the contract signing co-incided with an announcement from the Department of Transport of greater consolidation of train operating companies.

The move was welcomed by Rail Passengers' Council director Anthony Smith, who said "bigger franchises can bring passenger benefits".

But Rail, Maritime and Transport union general secretary Bob Crow said franchises up for renewal should be brought back into the public sector.

Commuter services

He said: "This does nothing to bring about a joined-up railway. Instead of having 25 franchises taking money out of the railways, we will have 19 and there willl still be millions of taxpayers' money poured into shareholders' pockets."

The Virgin Cross Country and Midland Mainline firms may also assume some services, said Mr Darling, as Network Rail takes over responsibilities for allocating routes from the Strategic Rail Authority.

Thameslink services across London would be taken over by National Express, operators of "One" services north east of London and a single franchise will include all "Greater Western" services in the south west, the DoT said.

The Isle of Wight line between Ryde and Shanklin may yet be included in a single franchise with commuter and long-distance services between London Waterloo, Portsmouth, Weymouth and Exeter.