Scottish Labour is calling for the extension of Scotrail's contract to be suspended following a critical report from the Auditor General and newspaper revelations that led to the resignation of Transport Scotland's Finance Director, Guy Houston.

Mr Houston had access to information affecting the award of Scotrail's new contract, a company in which he had shares. Labour say that this is a clear conflict of interest.

Des McNulty expressed his anger that both Transport Scotland and Scottish Government ministers are refusing to come clean about who was responsible for allowing this 2.5 billion contract to go through without proper scrutiny.

Labour's Transport Spokesman Des McNulty said:

"The Scottish Government stand accused of doing a secret deal with First Scotrail, awarding them a multi billion pound contract extension without proper scrutiny or consultation.

"Scottish Labour and the trade unions warned in March that this was unacceptable. We called on ministers to wait until Audit Scotland had completed their review before going ahead.

"It is astonishing that the Transport Minister, Stewart Stevenson, awarded the SNP government's biggest contract without even asking officials from Transport Scotland to prepare a proper business case.

"The Auditor's report has now raised serious questions leading to the resignation of Transport Scotland's Finance Director, Guy Houston. The award of this contract has been so badly handled that it should be suspended pending a full investigation.

2 December 2008