THE preferred bidder for the Intercity Express Programme (IEP) has denied it has done anything wrong after reports emerged that a rival bidder was considering legal action.

The Express Rail Alliance is said to be unhappy that Agility Trains has altered the terms of its IEP proposal.

Last year, Agility Trains, headed by Japanese manufacturer Hitachi, was selected as the Government’s preferred bidder to produce 1,400 new carriages to replace the country’s aging InterCity trains.

The Express Rail Alliance was the reserve preferred bidder.

Hitachi has indicated it would create thousands of jobs in the region by building a plant to assemble the new trains in Newton Aycliffe, County Durham. The contract has never been signed and the Government has been reviewing IEP to ensure it provides value for money.

An announcement on the fate of IEP was expected in last week’s Comprehensive Spending Review, but the decision has been deferred.

In the meantime, the Department for Transport said it has held talks with Hitachi about possible changes to the IEP contract to reduce costs.

According to reports, the Express Rail Alliance would consider legal action if Hitachi was awarded the final contract after changes to the bid. However, Hitachi last night denied any wrong doing.

The company said: “The Secretary of State has called for private sector initiative to reduce costs and make programmes more affordable.

“Hitachi has responded vigorously to this challenge and has worked extremely hard to address technical concerns expressed in Sir Andrew Fosters’ report regarding the bimode trains, which are part of the IEP. Hitachi’s revised design meets the requirements set out by the IEP.”

The threat of legal action comes as union leaders say the results of the spending review mean it is vital the Government goes ahead with IEP.

Kevin Rowan, regional secretary of the Northern TUC, said: “According to accountants KPMG, 55,000 jobs in the North-East will be lost.

“It is now more important than ever that the Government follows through on the IEP – an investment that will cost them nothing in the life of this Parliament, but one that would lead to the creation of thousands jobs in the North-East.”