Blow to prestige as Go-Ahead goes south

Jan 24 2008 by Karen Dent, The Journal

PUBLIC transport company the Go-Ahead group is to move its headquarters to London after more than 20 years as one of the North-East’s biggest companies.

Business leaders voiced their disappointment to see the firm go after a year which has seen builder Barratt shift most of its management to the capital, the purchase of ICI and the likely departure of Scottish & Newcastle and Northern Rock from the region’s portfolio of listed companies.

Go-Ahead, which owns bus, rail, aviation and parking businesses, has been based in Newcastle since it was created in 1987. However, the majority of its business is now focused in London and it has just 24 staff left in its Newcastle office. Speculation has been rife in the transport industry that a move would only be a matter of time after Keith Ludeman was appointed chief executive in 2006, but failed to relocate from the South-East to the North-East.

Go-Ahead spokesman Jim Boyd said the shift was a practical exercise to move a “handful of staff” who currently work in East Croydon in London to a more central base in the capital. “It’s just a tiny head office with a limited number of people. It’s a slight alteration in the communications function,” he said.

One person at the Newcastle office will lose their job because the role in duplicated by a member of staff working at the East Croydon site. No-one based at the Grey Street premises would be moving to the capital, Mr Boyd said. He claimed that the offices would be referred to as the “Newcastle office and the London office”, although the Newcastle premises will officially be renamed as the Group Accounting and Pensions Centre. “It’s business as usual,” Mr Boyd added.

It is understood the relocation is due to the high level of business the group has in London – it has 12 bus and rail operations in the South compared to just the Go North-East bus service operating in the region.

Vinay Bedi, of Newcastle-based stockbrokers WiseSpeke, said: “It might be a symbolic gesture but in theory Go-Ahead is not a North-East company any more, even though they still employ a lot of people up here.

“It’s a shame we are in essence losing the head office of another quoted company. We are in the business of trying to attract more quoted companies to the area. Sadly it looks like we’ve lost another one – Barratt Developments did a similar thing last year.”

The North-East Chamber of Commerce’s chief executive James Ramsbotham was also unhappy. “It is disappointing that a business that has such strong roots in the region believes that it can manage itself better from the South-East of England,” he said. “That said, Go-Ahead employs a large number of people in the North-East operating good public transport contracts and there is no reason why this decision should affect that situation.”

Ian Williams, One NorthEast director of business and industry, said: “Go-Ahead has long established roots in the North-East since the de-regulation and privatisation of the UK bus service industry in the late 1980s. Although it is disappointing whenever a company relocates any part of its operation outside the region, this decision will not result in any job losses or cuts to service that we are aware of.

“Go-Ahead’s move comes at a time when many large international companies are opting to set up bases of operations outside of the capital and in the North-East, such as GE Money, Fabricom and Clipper Windpower.”

The Go-Ahead Group, which was created when the National Bus Company’s Northern subsidiary was bought out by its management, now employs 25,000 staff nationally and its public transport interests carry more than 875 million people annually.