West Coast fiasco hits Parry rail firm
The fiasco over the West Coast rail franchise has left a small transport company with a £70,000 VAT debt and on on the brink of being wound up by the High Court.
The company behind the Parry People Movers rail cars – which are used on the shuttle service between Stourbridge Junction and Stourbridge Town stations – has appeared in the High Court to contest the HM Revenue & Customs order.
Chairman John Parry blamed their financial difficulties on the botched West Coast Main Line franchise, which he claimed had caused a "knock-on effect". The Department for Transport put all franchise deals on hold after being forced to tear up plans to strip Virgin Trains of the West Coast line. Errors were found to have been made by civil servants, and the Government faces a £100 million compensation bill. Even though the deals on which Mr Parry and colleagues were working had nothing to do with the Virgin franchise, they were still held up while the Department for Transport reassessed all franchise bidding processes.
Mr Parry said the firm was chasing a contract in southern England which would generate vital cashflow but the deal had failed to materialise due to the West Coast problems. Cradley Heath-based JPM Parry and Associates secured a 56-day reprieve from the court to allow them time to attempt to raise cash through its shareholders to pay the bill before the May deadline.
Mr Parry said today that the future of services on the Stourbridge shuttle, run by train operator London Midland, would be unaffected by the uncertainty bought by the legal action.
Mr Parry said: "This has adversely affected Parry's, and we have hit lean times. Orders worth millions of pounds are in prospect, once the new 120-passenger vehicle is ready for the market. The collapse of the rail franchising has resulted in the market not being ready to accept such vehicles until the franchise mess is sorted out.
"We would have been in serious trouble were it not for the assistance of a number of Parry People Movers shareholders who were alerted to the situation and have provided lifeline funds."
Parry People Movers has managed the Stourbridge branch Line since 2009. Ten people work for the design and engineering innovation firm which created the Parry People Mover rail car.
