My right honourable friend the Secretary of State for Transport (Geoff Hoon) has made the following Ministerial Statement.

In July 2007, the Government published their White Paper Delivering a Sustainable Railway. Within this the Government set out their high level output specification (HLOS) for the railways, detailing the outputs they wanted the industry to achieve by the end of the five-year period from 1 April 2009 to 31 March 2014 (known as control period 4 or CP4). These outputs covered the areas of capacity, reliability and safety.

In terms of capacity, targets for the accommodation of extra demand were produced for each of the main London termini and major cities. The White Paper indicated that a total of 1,300 additional carriages were expected to be required to meet these requirements. So far 423 of these additional carriages have been ordered, even before the start of CP4.

I am pleased to announce to the House that today that my department has signed a deed of amendment to its franchise agreement with London Eastern Railway Ltd, which trades as National Express East Anglia (NXEA) and is part of National Express Group plc.

This contractual variation will enable NXEA to add 188 carriages to its existing fleet, boosting capacity into London Liverpool Street by providing approximately 11,000 extra seats during the morning three-hour peak period by December 2011.

NXEA will lease 120 new electric multiple unit (EMU) carriages, that will be built by Bombardier Transportation UK Ltd in Derby. These trains, which have a capital cost of £160 million, will be owned by owned by Lloyds TSB General Leasing (No.8) Limited, a subsidiary of Lloyds TSB Bank plc. This is the first time this bank has provided finance for trains. The trains will principally be used on the Stansted Express route, enabling a cascade of rolling stock within the franchise to lengthen other services.

NXEA will also lease 68 Class 321 EMU carriages which are currently in use on the London Midland franchise where they are due to be replaced in July 2009. These carriages will receive an internal refresh.

NXEA will increase car parking space at four stations (Broxbourne, Audley End, Harlow Town and Diss), install two carriage washers and increase its workforce to implement the scheme.

Network Rail will be undertaking infrastructure enhancements to facilitate the changes to NXEA’s operations, including platform lengthening, power supply upgrades and two passing loops.

This is one of the largest contract changes negotiated with a train operating company (TOC) during its franchise term since privatisation of the railways in 1997. I hope to make further such announcements over the next 12 months, although this requires TOCs to co-operate in providing my department with affordable and value for money proposals which meet the capacity requirements for their franchise areas.