Taxpayer to foot settlement bill after driving test contract cancelled

Taxpayers looked set to be left with a large bill on Monday, after a contract for the management of Britain’s driving theory tests was yanked from the company which won it, and back into the hands of the prior concessionaire.

Sky News reported Learndirect - which was due to begin supplying the theory tests later this year - agreed to a multimillion pound settlement with the Government this month.

Rather than going ahead, the firm’s contract was cancelled by ministers and handed back to FTSE 100 publishing group Pearson for up to four years without re-tendering. Pearson had been administering the tests prior to the new contract.

It’s understood the Driver and Vehicle Standards Agency made the decision to cancel the contract with Learndirect, after discussions with the Cabinet Office and the Department for Transport.

The size of the payout was not disclosed, though it was reported that the contract with Pearson was more expensive than the once signed with Learndirect.

Learndirect is part of private equity group LDC, which is owned by Lloyds Banking Group.

It already runs the Life in the UK citizenship test for the Home Office, and the Professional Skills Tests for potential teachers for the Standards and Testing Agency.