A British firm in the race for Malta’s public transport service has expressed concern over the viability of the deal as laid out in the call for expression of interest issued by the government, Times of Malta has learnt.

In a letter sent to Transport Minister Joe Mizzi last week, the National Express Group warned it would be “difficult, if not impossible” for any private organisation to successfully achieve the government’s aspirations at the price it was proposing.

The letter was sent by the managing director of National Express, Andrew Cleaves, a few days before McGill’s, Scotland’s fourth-largest bus operator, said it had withdrawn its interest in running bus services in Malta.

McGill’s chief executive, Ralph Roberts, said the company took the decision to withdraw its interest because of “lack of openness” by the Maltese government.

National Express Group is a leading transport provider delivering services in the UK, North America, Germany, Spain and Morocco. Every year more than 800 million journeys are made on its buses, trains, light rail services and coaches.

‘Proposed regime is too great a risk for us’

In his letter, seen by The Sunday Times of Malta, Mr Cleaves expressed serious doubts on the viability of the public transport system as the government wanted it.

“We have assessed the expression of interest notice published on January 27 closely and I am very sorry to say that, in its current format, National Express would be unable to respond positively to that notice,” he told Mr Mizzi.

Although he confirmed receiving the letter, Mr Mizzi told this newspaper he did not know its details as he had immediately passed it on to Transport Malta to see if there was anything it needed to tell the company or if any questions needed to be answered.

He remembered meeting representatives of the National Express Group in Malta back in December “as I met anyone who wanted to meet me in connection with this bid”.

Mr Cleaves refers to this meeting in his letter, saying it was held to discuss key aspects of contracting and the balance of risk transfer related to labour, operations and maintenance, the financing of vehicles and revenue generation and collection.

However, he warned the minister the regime being proposed by the government and Transport Malta was not sustainable.

“I am afraid the regime set out in the notice presents too great a risk for us to reasonably be able to manage the network successfully for both you and the National Express Group.

“Indeed, I am concerned that, as it stands, it would be difficult if not impossible for any private organisation to successfully achieve the outcomes you aspire to at a price that would be agreeable to the public purse,” Mr Cleaves said. He proposed meeting to discuss these points in further detail with the aim of reaching an agreeable solution.

It is difficult, if not impossible for any private organisation to successfully achieve the outcomes you aspire to at a price that would be agreeable

When contacted, Mr Cleaves refused to discuss the details of the letter.

“I’m afraid I cannot comment on the contents of a private letter,” he said in reply to an e-mail.

He also refused to state whether the National Express Group was still interested in bidding for the Maltese public transport service, saying: “I’m sorry, but we won’t be commenting further.”

Asked for a reaction to the British company’s concerns that the service being proposed by the government was unsustainable, Mr Mizzi said: “There are other companies that expressed interest and these are not agreeing with what this company is saying.

“All correspondence received was passed on to Transport Malta.”

The Maltese government is looking for a new operator for the public transport service following multinational Arriva’s withdrawal from the island after sustaining losses of €70 million in just under three years.

In January, the government took over the bus service, which is now being run by Malta Public Transport Services, until a new operator is in place. A call for expression of interest was issued and closes on April 7.

The largest bus operator in Scotland, McGill’s, was “seriously considering” bidding for Malta’s public transport service tender but has pulled out of the race, leaving National Express Group and others in the race, which include the old bus service operators.

mxuereb@timesofmalta.com