TRANSPORT group Arriva today lost its bid to run a new rail franchise serving northern England.

The group failed to make the shortlist drawn up for the new Northern Rail franchise by the Strategic Rail Authority (SRA).

Subsidiary Arriva Trains Northern has been running part of the area covered by the new franchise, which begins next autumn.

The decision by the SRA to exclude Arriva follows the rail watchdog's move a year ago to strip ATN of the trans-Pennine rail franchise, which operates trains through Huddersfield.

The shortlisted companies for the new Northern Rail franchise are FirstGroup, which runs buses in the Huddersfield area, and Sercio Rail/Netherlands Railways.

FirstGroup has been running First North Western services, which will be incorporated into the new franchise. The SRA said the new franchise could last eight and three quarter years - with the last two years dependent on achieving performance targets.

The franchise will cover rural and urban lines across West Yorkshire, Greater Manchester, South Yorkshire and Tyne & Wear.

SRA operations managing director Nicola Shaw said:

"We will ensure that the right company is selected."

Richard Fieldhouse, chairman of Huddersfield, Penistone and Sheffield Rail Users' Association, said he was surprised that Arriva had not been shortlisted.

But he said passengers hoped to see some innovative ideas from the shortlisted bidders.

"There is scope to improve punctuality and the quality of rolling stock," he said.

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