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Rail shares crash as government scraps franchises

Rail shares crash as government scraps franchises

Shares in Go-Ahead Group (GOG) and FirstGroup (FGP) slumped after the government announced that it had replaced the rail franchise model with less lucrative, more performance-focussed contracts. The government has sponsored rail losses since March after the coronavirus pandemic slashed passenger numbers, capping fees at 2 per cent of an operator’s cost base.

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