Tenders are on the right lines

The government drive to slash the fiscal deficit could reignite the debate over foreign control of major UK infrastructure as ministers start the sale of the £1.5bn High Speed One rail link this week – with France's Groupe Eurotunnel and Australia's Macquarie bank among those tipped to bid.

The auction of the right to operate the route from London's St Pancras International to the Channel tunnel will be launched tomorrow and will also be included in Tuesday's budget, after officials signed off the pre-qualification questionnaire that will vet suitors, with an asking price in excess of £1.5bn.

Louise Ellman MP, chair of the transport select committee, said: "These are strategic assets and they are very important for the national and international rail network. We should be concerned about the long-term implications of this type of sell-off."

Philip Hammond, the transport secretary, said: "High Speed One is a national success story and a world class railway operating to international standards. The money generated by this sale will make an early significant contribution to the crucial task of reducing the public sector debt."

The Labour government was among the most relaxed in Europe about foreign control of strategically important infrastructure assets, a policy that drew criticism when Heathrow airport owner BAA was bought in 2006 by a consortium led by Spain's Ferrovial Group. The disruption of the liquid bomb terrorist plot in the summer of 2006, shortly after Ferrovial bought BAA, brought Heathrow to a near-standstill and triggered alarm over the ownership of Britain's largest airport.

The uproar was led by the late chair of the transport select committee, Gwyneth Dunwoody, who said decisions about the future of Heathrow would be taken in the interests of a Spanish conglomerate, not in the interests of the UK. BAA, however, has pointed to its British chairman and chief executive, and a multi-billion pound investment programme in its airports.

The winning bidder will secure a 30-year concession to operate the rail route and its stations, with ministers looking for a price in excess of £1.5bn. So far the only UK-based bidder to express an interest is Network Rail, the government-backed company that controls the UK's tracks and stations. However, it has already built up a sizeable debt burden and owes £23.8bn, which makes the company more likely to consider a consortium approach. Network Rail's state funding has been set until 2014, which means any additional fundraising may have to be covered by further taxpayer-backed debt.

This month, the outgoing chief executive of Network Rail, Iain Coucher, expressed interest in joining a group bid. "It is something we could do. We would like to be involved in high speed rail in some form." Network Rail operates and maintains High Speed One and has pledged to do "everything we can to assist in the sale process".

The sale of High Speed One, which cost £5.8bn to build, will include the acclaimed St Pancras International terminal in London and stations at Stratford, Ashford and Ebbsfleet, as well as the 68-mile route. Its main source of income is the track access charges paid by Eurostar, which operates services between London, Paris and Brussels and Southeastern, which runs the UK's only high-speed commuter service. However, St Pancras has surprised its owners by becoming a successful retail outlet in its own right, earning more than £10m last year.

High Speed One is owned by London and Continental Railways (LCR), which is in turn 100% controlled by the Department for Transport (DfT).

"We expect there to be a lot of interest in High Speed One. It will be a competitive sale process and we look forward to getting best value," said a source close to the process.

Eurotunnel, which has emerged from a protracted restructuring, is not expected to bid on its own but alongside the Goldman Sachs Infrastructure Partners investment fund, and M&G, a fund manager. UBS is representing LCR and the DfT has retained Citibank as its adviser.

The remaining assets in LCR are a 40% stake in Eurostar, High Speed One's biggest customer, and large land holdings at King's Cross and Stratford in London. However, those are not being lined up for an immediate sale. A source close to the auction process said the Eurostar stake might be a better candidate for disposal once a restructuring of the train operator is completed later this year. Eurostar is controlled by the French and Belgian state rail companies