Passenger Railway Services (Public Ownership) Bill
Monday 29th July 2024
(3 months, 3 weeks ago)
Commons ChamberRead Full debate Passenger Railway Services (Public Ownership) Bill 2024-26 Read Hansard Text Watch Debate Read Debate Ministerial Extracts
21:48 - The House divided: - Ayes: 351 / Noes: 84 - Question accordingly agreed to.
The Secretary of State for Transport (Louise Haigh)
I beg to move, That the Bill be now read a Second time.
At the general election, when millions of people called time on years of dysfunction, disruption and decline, they demanded change, not only in how the country is governed but in how it works, because for too many, from our economy to our public services, the country simply does not work any more. The things on which we rely are letting us down too often. Lifelines have turned into liabilities. That is why this Government have already started the work of rebuilding Britain, brick by brick, Bill by Bill. Five transport Bills in this year’s King’s Speech show not just the scale of our ambition, but how transport is at the heart of our plans for change. Growing the economy, becoming a clean energy superpower, making our streets safer, spreading opportunity, rebuilding our NHS—whatever this Government’s mission, transport is now mission critical.
Alberto Costa (South Leicestershire) (Con)
I am grateful to the Transport Secretary for giving way so early in her comments. There is a very controversial planning proposal for South Leicestershire, which is sitting on her desk as we speak—it is for the Hinckley national rail freight interchange. I am for rail freight interchanges, but the issue that has united Labour, Liberal Democrat and Conservative politicians in and around the area is that there are about five other rail freight interchanges within a 30-mile radius. Can she give a commitment from the Dispatch Box that whatever she says today will not ride roughshod over the views of Labour-led Rugby council and Conservative-led Blaby district council? Both have very serious concerns about this matter.
Louise Haigh
I am grateful to the hon. Member for putting his views on the record. He will know that I have a quasi-judicial role in determining the development consent order for that project. He is right to say that it is on my desk now, and I am considering it carefully. Nothing in today’s Bill will influence that decision.
National renewal requires nothing less than the biggest overhaul of our public transport in a generation. That starts with improving performance on our railways and kick-starting reform, which brings us to today’s Bill. It should surprise no one in this House when I say that our railways are not fit for purpose. For two and a half years, I said as much from the Opposition Benches to no fewer than three Tory Transport Secretaries. I would like to take this opportunity to welcome the new shadow Transport Secretary, the hon. Member for Faversham and Mid Kent (Helen Whately), to her place. I should note that my three predecessors, who sat on this side of the House, are no longer Members—I am not sure whether it is her job or mine that is cursed, but I wish her luck in the role.
Under three Tory Transport Secretaries, we were promised reform, yet, three years after Keith Williams’s review, little has changed. We were promised better services, yet some of the worst-performing operators were rewarded with new, lengthy contracts and handed performance bonuses.
Mike Amesbury (Runcorn and Helsby) (Lab)
When can we expect to see the shambles that is Avanti West Coast kicked into touch and returned to public ownership? I would certainly welcome that, and so would lots of northerners up and down the country.
Louise Haigh
I had a feeling that my hon. Friend might mention Avanti, and he knows my views. One of the first meetings I held as Secretary of State was with Avanti. I called in representatives of its Network Rail business unit for being one of the worst-performing operators—a meeting that was not held by any of my three predecessors while I was shadow Secretary of State. I made it clear that Avanti’s level of performance will not be tolerated, and we will use all measures under its national rail contract to hold it to account. That does not exclude terminating the contract before it expires if Avanti defaults.
We were promised High Speed 2 to Manchester, yet that was axed—in Manchester, no less—leaving a west coast main line that is now bursting at the seams. Meanwhile, passengers continue to suffer, with overcrowded trains and poor facilities, record-high cancellations—almost one in three trains is late—some of the most expensive fares in Europe, and regular bouts of industrial action.
Jim Shannon (Strangford) (DUP)
May I welcome the Minister to her place and wish her well in her new role? I thank her for bringing forward a Bill to modernise the railways.
I make a plea on behalf of those who are disabled. Whenever we have had debates on the railways in this Chamber, including Adjournment debates, the issue of disabled access has come up over and over again. Does the Secretary of State agree that disabled access at all railway stations should be a bare minimum and must be a priority, given that we have commuters who must still take private taxis to get to a wheelchair-friendly station? Further, does she agree that rural communities should not be disadvantaged by the closure of small stops in order to provide more streamlined timings?
Louise Haigh
I marvel, as always, at the hon. Gentleman’s ability to find something of interest and relevance to the debate at hand. He is absolutely right to say that accessibility is far too often overlooked, and we made it clear in the plans we set out ahead of the general election that accessibility would be one of the key measures against which we would eventually hold Great British Railways to account. The way in which people with accessibility needs are treated by our public transport system is undignified.
The broken model that our railways rely on is holding back talent, holding back opportunity and holding back Britain. It must be fixed, and we are wasting no time in doing so. By amending the Railways Act 1993, today’s Bill will fulfil one of our central manifesto commitments: to bring rail passenger services into public ownership. It overturns the privatisation by the John Major Government and allows us to take action as soon as contracts expire, or earlier if operators default on their contracts. It is a sensible approach, ensuring that taxpayers do not fork out huge sums to compensate operating companies for ending contracts early. Public ownership will become the default option for delivering passenger services, instead of the last resort.
Ruth Cadbury (Brentford and Isleworth) (Lab)
I congratulate my right hon. Friend on her appointment as Secretary of State and thank her for bringing in this excellent Bill. Since coming under the operator of last resort, TransPennine Express, which had been one of the worst-performing rail companies, became the most improved operator, so will this Bill mean that passengers on South Western Railway will see the same level of improvement, and how long will it take?
Louise Haigh
My hon. Friend is absolutely right to say that we have seen immediate improvements on bringing previously privately run operators into public ownership, but we can go further still, and that is the benefit of taking the two-pronged approach that I will set out later in my speech. She should be in no doubt that South Western will be brought into public ownership, as will all remaining contracts within the first term of this Government, and ideally within the first three years of this Bill receiving Royal Assent. We will act swiftly. I have no doubt that we will hear plenty of voices from the Opposition Benches labelling this an ideological move. Those accusations are way off the mark. There is nothing ideological about fixing what is broken and reforming what does not work.
Nadia Whittome (Nottingham East) (Lab)
I very much welcome this Bill and I congratulate my right hon. Friend on all her work in getting us to this point. Since our railways were taken out of public ownership, tens of billions of pounds have been lost to shareholder dividends and the inefficiency of a privatised system, all while ticket prices have soared. Does she agree that it is high time that we put passengers before profiteers?
Louise Haigh
My hon. Friend is exactly right, and that is what is at the heart of these proposals. This is an opportunity to genuinely reform our railways from top to bottom, to ensure that passengers and growing the railways are the only objectives that they should serve—not private operators, not shareholders, not the whims of the engineers that run Network Rail. This is a once in a generation opportunity to make sure that our public transport system serves the public, so it is not ideological. What was ideological was the previous Government sitting back and presiding over a broken system while passengers and the economy paid a heavy price. I know that the Tories have been trying to pretend that the last 14 years of failure have not happened, but they cannot deny that after 30 years of privatisation we find ourselves in a position where taxpayers are responsible for 50% of the rail industry’s income and underwrite almost every penny spent, while profits are siphoned off to shareholders.
Rachael Maskell (York Central) (Lab/Co-op)
I congratulate my right hon. Friend on her appointment as Secretary of State. I note that clause 2 of the Bill talks about the extension of the current contracts. Could she set out the circumstances in which that could occur, because we know that rail safety is best when track and train are brought together, as they would be under Great British Railways?
Louise Haigh
Clause 2 is purely a fail-safe if, for whatever reason, DOHL—the operator of last resort—does not have the capacity to take in a private operator’s contract at the moment it expires. We have allowed ourselves that flexibility if taking on a contract is not practically possible but, to demonstrate that it is not enabling franchising or private operations by the back door, we have also included the provision to remove that power again, to make sure that public ownership remains the default. It will happen only in exceptional circumstances for a very limited time.
As the railways’ passenger-in-chief, I am acting decisively today. This is the only response to the failure of privatisation to deliver reliable and affordable services for passengers. It also makes financial sense, saving tens of millions of pounds each year in private sector fees. That money can now be reinvested in the railways. Running the railways in the interest of passengers and taxpayers, not to the benefit of shareholders, also makes operational sense.
Kim Johnson (Liverpool Riverside) (Lab)
Will my right hon. Friend give way?
Kim Johnson
I congratulate my right hon. Friend on her new position.
As a long-suffering Avanti West Coast passenger, I welcome the Government’s prioritisation of this Bill, but does my right hon. Friend agree that railway workers should not be outsourced? Will she say a little about what she intends to do to ensure that they are not?
Louise Haigh
Network Rail has done a considerable amount of work on insourcing over the last few years, and I will ask it to do a more comprehensive review to see whether there is further it can do. As private operators are brought in, their contracts and supply chains will be considered, to ensure that they are delivering the best possible service for passengers. My hon. Friend raises a very important point.
The case for public ownership should not be controversial. After all, rail infrastructure was brought into public ownership by the last Labour Government following private sector failure. Germany, France and Spain, our European neighbours, all have models of public ownership. Indeed, the architect of the previous Government’s rail reform plan endorsed Labour’s plans ahead of the general election.
As has been said, four franchises—Northern, TransPennine, Southeastern and London and North Eastern Railway—are already in public hands and have seen some improvements. As someone who relies on TransPennine, I accept that it is still far from perfect, but cancellations have fallen from 20% in January 2023 to around 5% since it was taken into public ownership. LNER recently achieved a financial surplus, which was returned to the taxpayer.
Bringing the remaining 10 operators under public control will take time but, as passenger-in-chief, I am putting them on notice. I will not tolerate the status quo, I will not hesitate to demand improvements, and I will not be afraid to rip up contracts early if operators default on their obligations to the public.
The Bill means that the railways will finally be run for the public by the public, but owning the house is just the first step. Next, we must fix the crumbling foundations. That means fundamental reform, no ifs and no buts. We will set up Great British Railways as a new directing mind. Running the network, both track and train, as one integrated system will finally put an end to the fragmentation and waste that make our railways among the least efficient because of their spiralling costs and falling revenues, competing interests and industry inertia.
We will build a growing, innovative railway that is relentlessly and single-mindedly focused on passengers. There is no questioning the benefits at stake. Because GBR will take a whole-system view, we will be able to simplify the overly complex fare system so passengers can be confident that they are getting the best value. We will take aim at overcrowding by moving rolling stock to where it is needed in the network. We will end the piecemeal approach to innovation and roll out benefits such as digital pay-as-you-go and digital season tickets, and we will put accessibility at the core of our rail offer so that passengers with disabilities can expect a consistent level of service.
Of course, such change does not happen overnight. That is why setting up GBR and delivering our plans in full will be the focus of separate legislation later in the Session. But we will not sit back and wait for that legislation to be on the statute book; we plan to use every lever available to us urgently to improve services for passengers. That includes creating shadow Great British Railways, which will focus squarely on driving improvements in the short term, from ticketing to better services. This is a crucial next step, putting passengers back at the heart of the railways and firing the starting gun for reform.
Ben Maguire (North Cornwall) (LD)
What benefit will this Bill bring to my North Cornwall constituents who currently do not have a single railway station? Will the Secretary of State please explain to them what mainline train services will be coming to towns in North Cornwall such as Bude, Bodmin, Wadebridge and Launceston?
Louise Haigh
As the Chancellor has set out today, we will not only be reviewing the previous Government’s unfunded, underfunded and, in some places, cancelled capital projects, but we will be taking forward an integrated long-term infrastructure strategy. I would be delighted to meet the hon. Gentleman to talk about his constituents’ needs.
When I became Transport Secretary, I told the Department that we had a new motto: “Move fast and fix things.” The Passenger Railway Services (Public Ownership) Bill, the first major piece of legislation under this Labour Government, shows we are doing exactly that. The 30-year privatisation experiment has failed. Passenger satisfaction remains too low, while costs soar. Even before the pandemic, half of all trains in the north of England were late. All of this failure has consequences—communities cut off, talent stifled and ambition limited. It leaves Britain stuck in the sidings, unable to realise this Government’s mission of economic growth.
Today we start the work of repair, bringing our railways back into public service, restoring pride to an industry we should be proud of, and taking back control so that our railways finally work for everyone, wherever they live. In this mission, I am absolutely determined. I commend the Bill to the House.
Helen Whately (Faversham and Mid Kent) (Con)
It is a pleasure to serve under your chairmanship, Madam Deputy Speaker. Congratulations on your election.
It is my honour to respond to the first Second Reading of a Bill moved by this new Government, which I see as an opportunity to set the tone for how we will act in opposition. We are not going to oppose for the sake of it, and I do not believe that a single person on either side of the House, among the public, among those working on the rail network or even among those running the train companies would say that everything is as it should be with our rail system. We are in no doubt that rail needs reform.
Covid fundamentally changed the way we travel. Far fewer people now commute five days a week. The contracts that were brought in to save the railways are now stifling the companies they kept afloat, and the Treasury is subsidising the network’s day-to-day running to the tune of £3 billion a year, so things need to change.
That is why, in government, we commissioned a landmark review into our rail system. I welcome the fact that Labour is taking forward our plan for Great British Railways, which is the product of that review. Joining up track and train into a single public body will make the system more efficient and save passengers time and money, which is important because affordability and reliability are what people care about, and the point of being in government is delivering on what people care about.
Helen Whately
I worry about what this legislation tells us about how the Labour party plans to act in government. My worry when I first saw the Bill—multiplied many times over by the Chancellor’s statement, to which I will return—is that it seems to be based solely on ideology. There is no evidence, barely even a suggestion, that this Bill will actually improve journeys for passengers. The Secretary of State, perhaps to her credit, has even admitted so herself, saying that she cannot promise that fares will be any cheaper or that the trains will be more likely to run on time.
The Bill is the embodiment of the same old Labour mantra that anything run by the state is simply better than anything run by the private sector, and that the answer to a problem is putting politicians in charge, when it has been proven time and again that that is not the case.
Mike Amesbury
I thank the shadow Secretary of State for finally giving way. She referred to being ideologically wedded to a certain model of providing railway services. Will she explain why, despite its appalling record, Avanti West Coast was awarded a nine-year extension? Surely that was an ideological decision—the wrong decision.
Helen Whately
The point I will come to is that the Opposition and I, as shadow Secretary of State for Transport, do not choose to take an ideological approach. The important thing is what works. If the hon. Gentleman will hold on for a moment and listen to what I am coming to, he will understand my argument.
I confess I may be a little jealous if the Secretary of State is too young to remember life under British Rail: the dusty carriages, the worn seats, the clonk and rattle of the carriage doors, and hours spent waiting on deserted platforms wondering if, let alone when, the trains would ever arrive, without any information available. Even the sandwiches were tired. It is no wonder that in British Rail’s nearly 50-year history, passenger numbers across the network actually went down. There was a reason why private provision was introduced into the rail network and why the previous Labour Government stuck with it throughout the 13 years they were in power: it worked.
Today’s railway is unrecognisable from that under British Rail, not despite privatisation but because of it. In the first 20 years, passenger numbers doubled, a point that Labour’s own Rail Minister, who now sits in the other place, made in his 2015 report as the head of Network Rail. The majority of that growth is attributable to the private sector’s involvement, and it was achieved while operating one of the safest railways in Europe. Billions of pounds of private capital has been invested in rolling stock; there is now live real-time information on services; and, instead of British Rail catering, passengers can now choose between the likes of M&S and Greggs.
The railway went from costing taxpayers hundreds of millions of pounds a year to generating an operating surplus for much of the 2010s. It was not just taxpayers and passengers that benefited. To quote the general secretary of ASLEF, Lew Adams, back in 2004:
“All the time it was in the public sector, all we got were cuts, cuts, cuts. And today there are more members in the trade union, more train drivers, and more trains running. The reality is that it worked”.
We often hear it said in this country that our rail system should be more like those in Europe, where under a utopian system of public ownership, the trains always run on time and every journey costs less than a pint of beer. However, that is not how the European see it. In fact, in terms of the growth in passenger numbers and the controls on costs that privatisation delivered, our network is envied by Europe. [Laughter.] I knew Government Members would laugh, so listen to what I have to say.
Helen Whately
I will give way but not right now because I heard the reaction.
Right now, many European countries are in the process of unravelling their public models. They are introducing private provision and competition into their networks. The Dutch, the Czechs and members of the European Union will all be very confused to see us hurtling past them in the other direction.
Of course, free enterprise does not always succeed. That is why we already have a system in place for times when state intervention would—or, at least, should—benefit passengers. As I am sure the Secretary of State knows, the Department for Transport is already running several train operating companies, such as Northern Trains, which was taken into public ownership back in 2020. Four years ago, when the state took it over, a measly 61% of its trains arrived on time. Today, free from the greedy profit vultures who previously feasted on its carcase, that figure remains at 61%.
Compare that with Greater Anglia, whose contract comes up for renewal in September. By the way, Greater Anglia is the first train operating company in the Secretary of State’s crosshairs, and why the Government are choosing to rush this Second Reading through before recess. All of Greater Anglia’s services are running new trains. Some 94% of those trains arrive within three minutes of the scheduled time. The company manages to deliver that while paying a premium back to the Treasury. It is not failing.
In fact, every single one of the top five performers across the network is a private provider. By contrast, are hon. Members aware which company accounts for more delays than anyone else? Network Rail—some 60% of delays are caused by a single public sector organisation.
Ruth Cadbury
I am old enough to remember British Rail. On quite a lot of measures, British Rail was improving before it was privatised. While the hon. Lady wants to make an ideological attack on a state-owned railway, British Rail was 40% more efficient than eight comparable rail systems in Europe used as benchmarks in 1989. Does the hon. Lady agree with the former Secretary of State, Grant Shapps, when he admitted that the franchise system was no longer sustainable? What is her idea?
Helen Whately
I was perfectly clear at the beginning of my speech that we agree that reform is needed. That is why we commissioned a review and set out ambitious plans for reform, including the Great British Railways. I welcome that the new Government intend to introduce that.
I am not here to make an ideological argument. To respond to the point made by the hon. Member for Runcorn and Helsby (Mike Amesbury), sometimes, like with our plan for Great British Railways, the public sector is the right vehicle to solve a problem. At other times, a competitive, private model will lead to better results. The point is, if the Government are going to change things in the first piece of legislation they bring before this House, they need some pretty clear evidence as to why, so I have some questions for the Secretary of State and the Under-Secretary of State for Transport, the hon. Member for Wakefield and Rothwell (Simon Lightwood), who will be summing up.
How exactly will bringing train operating companies into public ownership benefit passengers? Unfortunately, the Government’s impact assessment does not tell us, for sure. What improvements can passengers expect? Who is the Secretary of State going to get to run these companies? Where are all these different, better train operating experts going to come from? If they are out there, twiddling their thumbs in the hope that this day would arrive, would the Department for Transport not have brought them on board already to help with the running of Northern Trains or Southeastern?
It is the same question across the network. Will she be sacking everyone currently working for the train operating companies and replacing them with a horde of superior, yet currently out-of-work, staff? Or, as I suspect, will passengers simply encounter the same group of people in a different colour shirt? What we need to hear is what tangible difference this going to make for passengers, because if the answer is nil, then there are lots of other things she could be doing with her time, such as prioritising the railways Bill.
The railways Bill is the legislation that will actually make a difference to how passengers experience our railways, with simpler tickets, joined-up decision making and efficiency savings that can be passed on to passengers. She could be modernising working practices, instead of bending over backwards to the unions, as reports suggest she has already done. How does she think that creating a single employer and, in the process, uplifting every rail worker’s terms and conditions to the least favourable for passengers, will benefit the network?
She could start by saving the train manufacturer, Hitachi—something that, when in Opposition, she said she could do with the stroke of a pen. I notice that it has been three weeks and that pen is yet to materialise. Perhaps she no longer takes for granted the work her predecessor did saving the Alstom factory in Derby. Or she could prioritise investment in the network, like the £100 billion we spent improving the railways since 2010.
On that point, I feel for her because I know what it is like to argue with a Chancellor for investment in something and not win that argument. It is clear from the Chancellor’s statement earlier that the Secretary of State for Transport lost the argument pretty catastrophically. Rather than setting out to reform welfare or control public spending, the Chancellor opted to slash a host of transport infrastructure projects. She will now review all transport infrastructure plans, putting the entire transport pipeline into chaos, letting down communities across the country and letting down a fair few of her new colleagues, too. Those new colleagues will be dismayed to find that they campaigned on false promises to the electorate, and that their pledges to invest in economic growth and not to raise taxes were not even worth the glossy paper on which their leaflets were written.
Although I know what it is like to lose an argument with the Chancellor, I do not share the experience that the Secretary of State and many of her colleagues will now be going through: of changing their tune just three weeks after they were given a mandate by the electorate and less than two weeks after their party leader had said that trust was the new battleground of politics. It seems as if he has given up on that battle already.
All the same, I welcome the right hon. Lady to her post, and I do genuinely wish her well. I will gladly offer my support to anything that she does to make our railways more reliable and more affordable. This Bill will not do that. It is a rushed piece of left-wing ideology. The evidence, both here in the UK and across Europe, shows that an effective public/private model, where the incentives are properly aligned, delivers more choice, more passengers and greater efficiency.
Over the next few weeks of recess, the Secretary of State and her team will have some time to reflect and reconsider. I hope that they will return in the autumn with a Bill that jettisons the baggage of ideology and takes up the mantle of evidence—a Bill that will have more prospect of improving the rail service for passengers, because, as I said, I have no interest in opposing for opposition’s sake, but this Bill as it stands will not be receiving the support of His Majesty’s Loyal Opposition.
Andy McDonald (Middlesbrough and Thornaby East) (Lab)
I congratulate you, Madam Deputy Speaker, on your elevation.
As I start my contribution, I wish to put on record how proud I am of my relationship with our trade union movement. I declare both the political and financial support that I have received, including from affiliated and non-affiliated railway trade unions, as reflected in my entry in the Register of Members’ Financial Interests.
It is an immense honour to speak on Second Reading of this most welcome of Bills. In the recent election, we set out in our manifesto how we will put passengers at the heart of the service by reforming the railways and bringing them into public ownership. With today’s Bill, that is what we are doing. The restoration of our railways to public ownership is something that I have spent much time working to achieve in this place, especially in the four years from 2016 as shadow Transport Secretary.
In that role, I produced a shadow White Paper entitled, “GB Rail: Labour’s plan for a nationally integrated, publicly owned railway”. It was nice to see that the then Transport Secretary tried to pinch the title, but I suppose that I should be flattered by that. In the document, I set out how the privatised UK railway has not delivered for passengers or taxpayers for a long time. I said, when we published our paper, that the railways must be run with the public interest as its primary objective, and I was looking at the sector more broadly, not just as passenger services. I am delighted that this Bill is before us today. I heartily congratulate the Secretary of State, my right hon. Friend the Member for Sheffield Heeley (Louise Haigh), on securing the first substantive debate and moving the first piece of legislation under this Labour Government.
The Bill is necessary because the privatisation model for Britain’s railways, introduced by the Major Government with the Railways Act 1993, has long been failing passengers. Even Margaret Thatcher was reluctant to privatise rail. The privatised rail system has put private profit-taking before the provision of public service. Far too many of Britain’s train franchises have been wholly or partly run by the subsidiaries of other countries’ publicly owned railway companies. Over the years, Deutsche Bahn, Nederlandse Spoorwegen and Trenitalia, to name just a few, have extracted value out of our railways to pump back into their own home railways, yet the only nation state that was precluded from running railways here was our own. Well, all that changes today.
I have previously said that the primary aim of Britain’s railway should be supporting the health of the economy and society, not other nation states and a small group of private franchise shareholders. The outgoing model has resulted in what is, and should function as, a public service, being subsumed to the commercial objectives to deliver for those shareholders and not the economy or the wider public good.
At the height of private franchising, it was estimated that more than £700 million a year in total was going to those companies’ shareholder dividend payments. That was unproductive, wasteful, and the opposite of value for money. This has been funded by the fleecing of farepayers. The Commons Library sets out that the cost of rail fares has increased by 20% in real terms over the past 20 years, while average real wages across the economy struggle to match 2008 levels. The additional revenue is not used to remunerate staff. Rail staff are incredibly hard-working public servants—employed by private companies since 1993—and RMT union members should not have needed 18 months of industrial action to get a pay deal on which they could settle. The position is similar with ASLEF union train drivers. It shames the Conservative party that these drivers, who had not had a pay rise in five years, were forced to wait for a general election and a Labour Transport Secretary to hold direct pay talks.
I pay tribute once again to the rail unions—the RMT, ASLEF and the TSSA—which keep our rail sector running, despite the problems of privatisation, and which deserve a better deal than they have had in recent years. The rising dividends, funded by rising fares, at the expense of employee pay, have been paid out regardless of performance.
In the most recent statistical release by the Office of Rail and Road, 8.5% of Avanti West Coast trains were cancelled in the last quarter and 10% were more than 15 minutes late. Similarly badly, 7% of CrossCountry trains were cancelled and 6% were more than 15 minutes late.
Under the Conservative’s rail network, the private sector took the profit, the public sector picked up the pieces when things went wrong. When the covid pandemic led to falling passenger numbers, the Government stepped in to prop up the railway with funding. During the recent rail pay disputes, the RMT has argued that rail companies were being indemnified against any losses to the tune of £1 billion, on the same day that there was a national strike on the railways.
Well, Madam Deputy Speaker, the public have had enough. They want change, and Labour is now delivering it. The public voted for it. We believed that they would do so, because polling has always shown that they support public ownership and that is right across the political spectrum. In a YouGov poll just after the King’s Speech, 76% said that they backed public ownership of rail, up from 60% at the 2017 election. That also reflects the increase in support for public ownership of energy: something else on which we are making a start.
Across the economy, it is clear that voters have had enough of rip-off privatisation and are embracing public ownership. There is much, much more that we will achieve, enabling all of us to travel much more easily and reliably, with simpler fares, connecting with other modes of increasingly decarbonised public transport, to give our economy and the quality of life a massive boost.
With this marvellous Bill, my right hon. Friend has the golden opportunity to make sure that our railways work for our people and our businesses, not for the private profit of train operators. I look forward to speaking with her about the much-discussed expansion of rail connections to our capital city and across the northern region, from my Middlesbrough and Thornaby East constituency. I commend her for the superb job that she has done thus far by bringing forward this Bill today. I wish her and the Bill every success.
Wera Hobhouse (Bath) (LD)
Thank you for calling me to speak, Madam Deputy Speaker. I do not think that I have yet had the opportunity to express my pleasure in seeing you in your new role. May I also congratulate the right hon. Lady on securing her new role as Secretary of State?
Our railways are in dire need of improvement. Under the last Conservative Government, passengers were repeatedly failed. Services are poor and the ticketing system is in shambles. All the while the public keep paying more and more, year on year. Rail fares in the UK are already some of the highest in Europe and are set to rise again. I am sure that all Members of this House have heard about, or experienced, cancellations, delays and a ticketing system not fit for purpose. People are crying out for a functioning rail network that they can rely on.
Too often, my Bath constituents would rather travel by train, but take the car instead because a train ticket is far too expensive. If we are serious about meeting our net zero target and reducing emissions, rail must be not just a green option, but an affordable one. Since privatisation, passenger journeys have more than doubled to 1.71 billion per year. However, satisfaction is at its lowest level in over 10 years. We agree with the Government that competition is not working as intended. Fewer and fewer companies are bidding for new franchises as the costs have ballooned. Meanwhile, Government subsidies have increased and intervention is desperately needed.
The UK needs a world-class rail network to support growth and reach net zero. For too many years, it has been held back by under-investment and lack of ambition, particularly in the north and south-west. However, may I ask what will happen to investment after nationalisation, when Great British Rail will have to compete for funding with the NHS and schools? I am sure this Government will agree with us that they must guarantee that funding for a nationalised rail network will not come at the expense of other public services.
We Liberal Democrats want the fairest deal for passengers. Anything that brings down fares is welcome and I look forward to the Government setting out how services will improve when in public hands. Nationalisation is an interesting idea, but Liberal Democrats want an approach that benefits passengers right away. We would freeze fares immediately and then get on with reforms to the broken system. Passengers might not be that interested in who is running the trains, but they are interested in whether they are running on time and at a fair price.
There is inconsistency within the proposed policy: just as private companies do now, Great British Rail will continue to lease rolling stock. Rolling stock leasing companies benefit from a monopoly out of the 1994 privatisation and make excess profits. One quarter of operators’ costs go to those companies and I hope the Government will urgently look into that.
The Liberal Democrat approach is pragmatic. We will scrutinise the legislation according to what is best for passengers. We want one nationwide body with proper powers to put investment in the right place and hold train companies to account. Our proposal is for a railway agency to act as a guiding mind for the railways, putting commuters first, holding train companies to account and bringing in wholesale reform of the broken fare system.
It is currently unclear what the financial impact of nationalisation will be. There are potential savings due to management and performance fees no longer being payable. However, subsidies might increase after nationalisation. Private operators are already subsidised to run unprofitable services, and public sector companies would similarly need financial support, which might increase over time. We are putting down these concerns to make sure that we are properly holding the Government to account on their proposals. Can the Government really ensure that funding will be adequate without fares increasing further?
There is no reason for nationalising companies purely based on their contract expiry date; the Government should start by focusing attention on operators that are demonstrably failing passengers. GBR could then focus on turning those services around to deliver tangible improvement for the public. The Government should at least look at that, and operators that are performing well should be deprioritised. That would be better for travellers and reduce the cost to taxpayers.
There are other questions that we need clarity on. When the contract is up, will train operating companies go straight to Great British Rail or to the operator of last resort? If it is to the operator of last resort, what incentives will there be for operators to grow rail revenues, which are still at 70% of pre-pandemic levels? A larger OLR team will be necessary to manage the increased number of rail journeys while GBR is being set up. The explanatory notes to the Bill do not consider that increased cost.
All that must be part of a wider, long-term rail strategy. Instead of fixating on the issue of ownership, our railways need a rapid and significant change to put passengers first with a focus on the quality of service. We are interested in looking at what benefits nationalisation will bring, but we urge the Government to be pragmatic.
Madam Deputy Speaker (Caroline Nokes)
I call Josh Dean to make his maiden speech.
Josh Dean (Hertford and Stortford) (Lab)
Thank you, Madam Deputy Speaker. I am grateful for the opportunity to make my first contribution in this House and welcome you to your place following the election. I congratulate all hon. Members and hon. Friends who have given their maiden speeches over previous days. They have been a reminder of the immense talent of those joining this House, and what a privilege it is for me to be among them. I look forward to hearing their many contributions to debates over the coming months and years.
I begin by paying tribute to my predecessor, Julie Marson, who served our residents for four and a half years. I thank Julie for her hard work in helping to secure banking hubs to protect our residents’ access to in-person banking services in parts of our community—work that I look forward to continuing. I know that the whole House will want to join me in wishing Julie and her family the very best for the future.
It is the honour of my life to represent the community where I grew up and that I call home, as the first Labour MP in Hertford and Stortford’s 41-year history. Our town centre in Hertford gave me my first job, our railways carried me to the university education I thought I had missed out on and, although I am not sure that at age 24 I count as an old boy of the school, I am a proud former student of Richard Hale. I am deeply humbled by the trust that our residents have placed in me, and I will work every day to ensure that it is repaid.
Hertford and Stortford is a historic community. When plague overran London in the 1500s, this Parliament moved to Hertford castle, where the gatehouse is now home to Hertford town council. Bishop’s Stortford is suspected to be a Roman new town, and may once have sat at an ancient transport interchange. Sawbridgeworth boasts architecture from the Tudor, Stuart and Georgian periods, and Ware was home to a malt-making industry that lasted from the civil war to the 20th century.
Our constituency represents so much of what is great about our country: hard-working communities, historic towns, and hubs of innovation, creativity and commerce. I had the chance to visit one such hub of innovation on a recent visit to Wickham Hall in Bishop’s Stortford. There I was inspired by David and Suzy Harvey, self-styled “custodians of the countryside”, whose creativity and passion have transformed a 100-year-old family farm into a thriving business community, making use of the green technologies of the future and with a mission to protect our environment.
Our natural environment is as diverse as it is beautiful, with some of Britain’s rare chalk streams, of which our residents are rightly fiercely protective, running right through our constituency. I therefore warmly welcome this Government’s commitment to cleaning up our precious waters. I will work tirelessly, within this House and in my community, to ensure that they are protected.
Today, many of our Hertford and Stortford residents will travel to and from work using our local railways, whether from one town to the next, from our constituency into London or even further. However, when I speak to residents in our community, too often I hear stories of a broken rail network that is not working for local people. Indeed, just today one of my residents contacted me to say that yet more services had been cancelled to Hertford North this evening due to a lack of staff.
Our railways were once the pride of Britain, connecting people and places with new opportunities, but the current model of privatisation is failing passengers and staff across the country. I am heartened by my right hon. Friend the Secretary of State’s promise to “move fast and fix things”. We know that publicly owned, passenger-focused rail can deliver the efficient, high-quality and reliable service that our Hertford and Stortford residents need, and make our railways something to be proud of once again.
I have not followed a traditional path through life, as my sometimes frustrated parents would agree. I left school at 17 and went straight into work, first in my town centre, then commuting into London, before working in recruitment in a local business park. I returned to education during lockdown, enrolling at the University of Westminster to study—perhaps unsurprisingly—politics, blissfully unaware that in a few years’ time, I would be desperately trying to navigate the corridors of this place.
I would not have found the path that was right for me had it not been for the inspirational work of our youth clubs in Hertford and Stortford, and it is to them that I wish to pay tribute now. I have experienced at first hand the difference that their work makes to the lives of our young people, and I can say with confidence that, had it not been for the support and guidance of a youth worker named Russell Cairns, I would not be in this Chamber today. I have since had the privilege of visiting the Thirst youth café in Bishop’s Stortford and volunteering at FUTUREhope youth café, in the very building where I once sought advice from Russell. I look forward to working with them and many others as our Member of Parliament, to ensure that every young person in our community is supported to find the path that is right for them, just as I was supported to find mine.
I hope I can also show our young people that, if they wish, the path they choose can lead them here. During the election, I had the chance to visit some of our local schools, taking part in a hustings at Herts and Essex high school in Bishop’s Stortford and answering the questions of sixth-formers at Leventhorpe school in Sawbridgeworth and Richard Hale school in Hertford. I was struck by their insightful questions and genuine passion for politics.
We know that young people are at the sharp end of so many of the crises we face today, whether it is the climate crisis or the crisis in housing and mental health, but too often they feel powerless to make a difference and that politics is not a place for them. I am proud to be a young person representing his community, joining this place among a cohort of younger parliamentarians. But it is incumbent on all of us to show our young people that they have a place not only in politics, but in this Parliament too, and I look forward to working with colleagues across the House to make that happen.
Finally, I would like to reflect on two people without whom I would not be here: my mum and dad. My mum taught in local schools before becoming a special educational needs co-ordinator. I have grown up watching her give so much to her profession in often challenging circumstances. Hers is the story of teachers and support staff across our schools across the country, and she continues to be an inspiration to me—as is my dad, who now lives just outside Bishop’s Stortford and, like so many of our residents, commutes into London every day.
My parents moved to Hertford in the late 1990s because they wanted the best start for me. I cannot think of a better moment than now to thank them for everything they have given me over the last 24 years. My parents are examples of hard work and dedication, principles that they have instilled in me, and those are principles that I will carry with me every day as I go to work in this place.
Wendy Morton (Aldridge-Brownhills) (Con)
I congratulate you on your new role, Madam Deputy Speaker. I also congratulate the hon. Member for Hertford and Stortford (Josh Dean) on making his maiden speech. I am sure that he will learn and appreciate, as the weeks, months and even years go by, that there are times when we will argue and debate in this place, but there are many things that we also have in common. Like him, I left school and did not go to university until much later in life. The other common point I will mention—I will come to this in my contribution—is the importance of rail links to our local communities. They create a link to opportunity for young and old alike. I sincerely wish him well.
I was clear in my contribution to the King’s Speech debate that where I agree with the Government, I will say so. As a former Rail Minister, I would be one of the first to agree that the rail system needs reform. Post pandemic, we have seen that commuting and business travel have changed beyond all recognition, but so too has leisure travel, and the demand has changed greatly. The current system needs to make greater use of the public-private model, but crucially, it must also have a greater passenger focus.
There are 20 franchise train operating companies in Great Britain, with—let us be honest—levels of operational performance and cancellations that vary dramatically, as I am sure all across the House would agree. There is nothing more frustrating for someone than arriving at the train station on their way home at the end of the day, or at the end of the week from this place, only to find that their train is delayed or, worse still, has been cancelled.
For example, at one end of the spectrum, we have Avanti West Coast, one of the worst performers; its contract expires in 2026. Let us contrast that with West Midlands trains, one of the much better performers; its contract expires in September this year. I would hope that if the new Government were truly passenger-focused and wanted to get us moving forward, they would seek to address the worst performers first.
I have a few questions that I hope the Secretary of State or her Minister will answer in their summing up. What does the Bill actually mean for passengers? I have yet to understand that fully. I have yet to hear the Secretary of State confirm that prices will be cheaper, but perhaps she can do so today. We have heard that there will be a focus on the taxpayer, but what about the traveller? For too many, rail travel is still unaffordable, and I fear that it will become more unaffordable under these proposals.
What about the other aspects of the services? Will cleaning contracts be nationalised? What about catering? Will we see a return to the days of the British Rail sandwich? I do not think I am quite old enough to remember those days, but I have it on good authority that the British rail sandwich is somewhat emblematic of the unappetising fare of the nationalisation of our railways.
What about ticket offices and ticketing? We have heard that there should be improvements to ticketing, but what plans does the Secretary of State have? Will she keep them open or close them? Will there be more staff out on the platform to help passengers?
Rachel Hopkins (Luton South and South Bedfordshire) (Lab)
The right hon. Member mentioned ticket office closures. I remind her that that was the proposal from her previous Government.
Wendy Morton
It may well have been, but I am here to scrutinise the Government of the day. I will be the first to recognise that where ticket offices are selling one ticket a day, it makes much better sense to have those operators out on the platform helping people with, for example, accessibility issues and the machines. This whole point is about being truly passenger-focused.
I would also like to better understand what the investment will be in the training of train drivers. It takes a very long time for a train driver to be fully trained for any given route. Without a sufficient number of train drivers, we end up being in hock to the unions. Similarly, I would like to understand whether the new Government truly believe in a seven-day railway service, because that is what passengers expect. We expect trains to operate not just from Monday to Friday, but for seven days a week. I would therefore expect any rail operator, particularly under nationalisation, to offer that service as well.
On open access, I would like a greater understanding of what that model will look like. Will it be kept or not? The reason I ask that is really parochial and community-focused. My constituency is one of the very few that does not have a train station. Hon. Members may become rather tired of me saying this in the forthcoming weeks and months, but under the former Mayor of the West Midlands, we secured funding through the city region sustainable transport settlements, working with the council to move forward. We have the train line and the site identified for the car park. Everything was going forward. We even have an open access operator that is looking to put in a service from Wales direct to Euston, which would be an absolute game-changer for young and old alike in my constituency.
Sadly, the new Mayor of the West Midlands will not confirm that that project is going ahead; he prefers to hide behind a review. And after today’s announcement by the Chancellor, I fear that she is probably backing him and encouraging him down that route. As ever, though, I remain hopeful and wait to be convinced otherwise.
As we have heard today, Great British Railways is not an entirely new idea. When we were in government, our plan was to set it up as a public entity, joining track and train across the country. However, what we have in front of us today is very different: we have ideological nationalisation, risking taxpayers’ money, and a plan that the Government cannot confirm will reduce costs or increase capacity or reliability. In short, it does not put the fare-paying passenger first—this is a political choice.
Mr Paul Foster (South Ribble) (Lab)
Thank you, Mr Speaker, for affording me the honour and opportunity to make my maiden speech today. I have listened intently to many speeches over the past few days, and I congratulate all those who have made their maiden speech. I rise with slight trepidation in my aspiration to match the passion and eloquence of others, who have spoken in such an inspiring way about their constituencies, life experiences and priorities. I commend them all.
I would like to start by paying tribute to my immediate predecessor, Katherine Fletcher. Katherine dedicated herself for the past four and a half years, and had a real passion for wanting to improve the lives of many people in the constituency. I also pay tribute to all previous elected Members of Parliament who have served the community of South Ribble: the right hon. Sir Robert Atkins, David Borrow, Lorraine Fullbrook and Seema Kennedy. All are still highly thought of.
Today, we debate the public ownership of passenger railway services. For my constituents, that cannot happen quickly enough. With Avanti West Coast, which in my instance runs the west coast main line between Preston and London, we are subjected to quite possibly the worst franchise in the country—and trust me, given the state of many of the current franchises, that is some achievement.
Being elected on the new boundaries for South Ribble—which, Mr Speaker, now include many areas of Chorley Rural West—on 4 July was a huge privilege, humbling and a great honour. I cannot thank the people of South Ribble enough for giving me this opportunity to represent them. I hope and promise to do my best, using my experience in industry, in the military and, more recently, as their council leader in local government. With a heavy heart, I have now passed on the baton of the leadership of South Ribble borough council to Councillor Jacky Alty, my friend and colleague. I send her and the council my heartfelt best wishes for the future.
However, I am now in a new political chapter and intend to push forward, delivering change with my new Labour Government and colleagues, and I will take every opportunity to advance my constituents’ priorities and prospects in every way I can, with all the energy and experience I bring. I remain committed to ensuring that they all begin to thrive following such challenging times.
I was brought up in Barrow-in-Furness, and I have a continuing passion for Barrow AFC. However, during the crippling strikes at the shipyard in 1988 in response to Mrs Thatcher’s targeted attacks on the UK’s manufacturing industry, I ended up joining the British Army’s Corps of Royal Engineers at the tender age of 18. I served for just under 15 years, serving operationally in the first Gulf war on Operation Haven and in the Kosovo conflict in 1999, to name but two. After retiring from the Royal Engineers in 2003 to be closer to my young children, I moved to South Ribble to establish a new life and a fresh start, and made it my home. The people are always warm and welcoming, and I understand that I am the first Member of Parliament actually from the constituency to have been elected to represent it.
Like many constituencies, South Ribble is both rural and urban. We have the River Ribble running through the north of the constituency, and borders with Preston, West Lancashire, Ribble Valley and Chorley. South Ribble is made up of many small villages, like Much Hoole, Hutton, Charnock Richard, Longton, Croston and Eccleston, as well as towns such as Penwortham and Leyland, where—as Members may have guessed—Leyland trucks were historically produced and our fantastic manufacturing base was born. I think we have Leyland Motors to thank for the now well-established global defence manufacturer, BAE Systems, on our doorstep. The draughtsmen, designers, fitters, engineers and fabled toolmakers were all in abundance at Leyland Motors in South Ribble, and that knowledge has been passed on proudly through our local skills and training institutions for decades. Central Lancashire provides thousands of highly technical workers to many critical sectors, primarily the defence sector.
South Ribble has many unique characteristics, cultures and attractions. As the council leader, I have come to know my constituency intimately: spending time at the longest-standing green flag awarded Worden park and Worden Hall on a Saturday afternoon; having a pint with Martin, Nigel and Rachel in the Market Ale House in Leyland; or working with fellow veterans, who are represented in an astonishing 19% of households in South Ribble. I will continue to support and champion individuals such as 15-year-old Ben Griffiths—or “Boisterous Ben”, if Members would like to follow his story on social media. Ben is living an exceptionally tough life, with intractable epilepsy that he has had since birth. He has a desperate need for full access to NHS-prescribed medical cannabis, which he is not being permitted. In my opinion, he is being denied that life-saving medication due to bureaucracy. I will not accept that, and will not rest until Ben gets the support and medication he needs.
I will also continue to support my community, who desperately need new road infrastructure to lessen congestion and travel times and improve air quality, as well as more quality housing and developments in the right places so that communities and families can continue to live together in South Ribble. However, these developments must be sustainable, with infrastructure first, and they must be affordable. I will strive to get the Government to commence a huge council house building programme with local councils up and down the country. I am proud that when I was council leader, we commenced building the first council houses in a generation in South Ribble—houses that are high-quality and affordable.
I will continue to champion inward investment through devolution in the north-west and to work towards an elected mayor and combined authority for Lancashire, permitting local decision makers to have greater powers in their own transport, health, policing, skills, education, housing and employment. The current county combined authority being pursued by Lancashire county council just is not good enough—I have already spoken to the relevant Secretary of State about the issue. We must also optimise the opportunities that will come with the brand-new cyber-security centre on our doorstep, at BAE Systems in my neighbouring constituency of Ribble Valley; it really could become a global centre of excellence, offering huge opportunities to the entire constituency.
Finally, I pay tribute to my beloved mother Marilyn. After losing her to cancer complicated by covid in 2020, I know what losing a loved one feels like. She was only 68 years and one day old when she passed; she was lonely and afraid, and the pain that me and my family, and many thousands of others, went through during the pandemic can never, ever be repeated. Her end of life was desperately traumatic, and could and should have been avoided. I hold a very personal and strong view on the very well-publicised parties that were held down here. We must learn lessons, and must all listen very carefully to what the covid inquiry finds. Given me and my family’s experiences with my mum, I also look forward to the passionate debate on assisted dying, which will be a deeply complex but critically important piece of legislation.
I have dedicated 32 years of my life to public service in the British Army and in local government. I now further commit to you, Mr Speaker, to this House, and to each and every one of my constituents, as it states in my Institution of Royal Engineers’ motto, “service not self”; I promise my continued public service, upholding fully the principles of integrity, objectivity, accountability, selflessness, openness, honesty and leadership at all times. I am honoured to be here to serve the people of South Ribble.
Mr Gideon Amos (Taunton and Wellington) (LD)
I rise to give my maiden speech. I congratulate you, Mr Speaker, on your position and the Transport Secretary and the Front-Bench team on their positions.
It is a privilege and a pleasure to follow the maiden speeches that we have just heard, including by the hon. Member for Hertford and Stortford (Josh Dean), who, along with my hon. Friend the Member for Eastbourne (Josh Babarinde), significantly increases the Josh quotient in the House. If I contribute nothing else, I clearly increase the Gideon quotient by the massive number of one new Member of Parliament. I also thank the hon. Member for South Ribble (Mr Foster), whose public service has been enduring. He has had my congratulations on that already. Their speeches will be a hard act to follow, but I have the advantage of representing Taunton and Wellington, so it should not be too much of a problem.
I give credit to the former Conservative Member for Taunton Deane, Rebecca Pow, who will, I am sure, continue her enthusiasm for gardening and wildlife. She was, of course, a Minister with responsibility for water and for our rivers. I am partial to a dip in the river from time to time, so I was pleased to successfully apply for bathing water status for a stretch of the Tone in Taunton to get the improvement in water quality that we desperately need in our rivers down in Taunton. The River Tone is the silver thread that joins Wellington to Taunton to the levels, close to where the famous cakes were burned near the King Alfred Inn at Burrowbridge.
I also pay tribute to the former Liberal Democrat MP Jeremy Browne, the Member of Parliament for Taunton Deane from 2005 to 2015. He served as a Home Office and a Foreign Office Minister, and remains incredibly well liked in the constituency. He was the first Member to propose a new railway station for Wellington, and I am delighted to have had the Chancellor’s assurance in the previous debate that that project will go ahead. I am the eighth Liberal to represent Taunton in Parliament since some guy named Disraeli was defeated by the first one in the 1835 general election. Of course, nothing further was heard of him—at least not in Taunton.
Taunton’s parliamentary tradition is very deep-rooted. As a county town with a castle, which today proudly houses the Castle hotel and the superb Museum of Somerset supported by our dynamic town council, its parliamentarians held out in siege after siege. Today, the hard work of so many people in Taunton at the Brewhouse theatre, the Southern Sinfonia, the Bluebirds Theatre Company, the Tacchi-Morris, the Willows and Wetlands visitor centre, the Creative Innovation Centre, Arts Taunton, GoCreate Taunton, groups such as Amici and Voce, and the Bradford Players—I have many more—the Taunton Thespians and the @2K Theatre; and in Wellington at the Arts Centre, the Wellesley Theatre, the operatic society, and the Gaumont theatre, which once played host to the Beatles and the Rolling Stones and is now home to the bingo, all comes together to mean that not only do we have a Mecca, but our area is a cultural mecca to which people come from far and wide.
Then, of course, there is the magnificent Somerset county ground, graced by the towers of St James and the minster, where I married Caroline just 28 short years ago. I thank her and our children, Emily, Fraser and Fenner and Felix, from the bottom of my heart for their support. Our schools from North Town and Minerva to Bishop Fox’s, Court Fields, Castle, Pyrland, Selworthy and Monkton Wood feed into our nationally renowned Richard Huish College, Bridgwater & Taunton College and University Centre Somerset, which now offers degrees like nursing, in support of the superb staff at Musgrove Park hospital. Funding is urgently needed for the hospital’s new maternity unit, because buckets are currently used to catch the rain in the corridors of a building built for the US army—as a temporary building—in 1940.
Similarly, King’s and Queen’s, Taunton and Wellington’s independent schools, make a massive contribution to our area’s local economy. We also have a successful home education community that inspires an innovative generation of young people. To all our area’s children, I say: “Be yourself. If your name is Gideon, for example, there’s no need to change it to get elected to Parliament.” That is something I once tried to discuss with the former Member for Tatton. I confess that it has taken me a little time to get to this Chamber—if I had not had to deliver all those bibles to hotels, I would have got here a lot quicker.
All those institutions, together with the UK Hydrographic Office, make Taunton the ideal location for new research and innovation entrepreneurs. It is only 104 minutes from Paddington, so they should all come and enjoy the amazing quality of life that we offer. When they come to Taunton, they will find a ticket office at the station that is still working. I was amazed to hear the right hon. Member for Aldridge-Brownhills (Wendy Morton) apparently still advocating the closure of ticket offices—a policy about which I can say only “good luck”. To encourage people to come to Wellington, I look forward to working hard on the Wellington station project that I mentioned earlier.
I invite the right hon. Lady the Transport Secretary, and the Under-Secretary of State for Transport, the hon. Member for Wakefield and Rothwell (Simon Lightwood), to visit the project. On their visit, I hope that they will enjoy a glass of famous Sheppy’s or Taunton cider—or, to pronounce it correctly for Hansard, zyder—at the Ring of Bells, the Green Dragon or the Pump House in Tonedale, in a Rocket and Bird glass with some Somerdale cheese and perhaps some Bumblee’s relish, followed by a meal at Guddi and Gikki, Maliha and Taj, the Little Wine Shop or Augustus. They are ideal for planning visits to key organisations in the constituency, like WPA, Pritex or indeed the 40 Commando Royal Marines at Norton Manor camp.
I was delighted to support the Royal Marines, with the help of former Royal Marine Paddy Ashdown—raising an ultimately successful petition to gain a U-turn on the previous Government’s shocking proposal to close down the entire facility. In his maiden speech the other day, my hon. Friend the Member for Tewkesbury (Cameron Thomas), drew attention to the huge sacrifice that previous generations made so that we are all free to sit in this Chamber today. My service in the Territorial Army was pretty minimal, but my father, FJC “Jim” Amos CBE, and my mother, Geraldine Amos MBE, both served in world war two, following their fathers who served in the trenches. I remember discussing it with them all.
When I was growing up, hon. Members will not be surprised to hear that the atmosphere and the memories of war loomed large in discussions around meal tables. Is it not that generation’s courage and bravery, not only in rebuilding Britain but in defeating fascism in the first place, that demand our respect? They demand that we do everything we can to defend the liberal and democratic values that make this country so great. Their bravery surely also demands that all hon. Members, on both sides of the House, always say no to those who would stir up division, despair and hatred for nothing more than votes, because they have nothing positive to offer people.
It is the greatest privilege of my life to serve the residents of Taunton and Wellington—from Hatch Beauchamp, Helland and North Curry in the east to Whiteball, West Buckland, and Sampfords Moor and Arundel in the west; and from Bishopswood, Churchinford and Stoke St Mary in the south to Pickney, West Monckton and Kingston St Mary in the north—in this House. I am here to do one thing: work for them and stand up for them to those in power whenever that is the right thing to do. I thank you, Madam Deputy Speaker, for the opportunity to begin that duty today.
Madam Deputy Speaker (Judith Cummins)
I call Kevin Bonavia to make his maiden speech.
Kevin Bonavia (Stevenage) (Lab)
Thank you, Madam Deputy Speaker, and congratulations on your own election. I also congratulate the hon. Member for Taunton and Wellington (Mr Amos) on his excellent speech. Today is my first opportunity to speak on behalf of the people who have sent me to this House, the residents of the tremendous town of Stevenage and the vibrant villages of Knebworth, Codicote, Datchworth and Aston. It is such a special honour and responsibility to represent the place that I am proud to call home.
Stevenage itself is a trailblazer town, the UK’s very first new town, created by the transformative Labour Government of 1945 to deal with the last great housing emergency after the second world war. It was built around the old town of Stevenage, which made its name many centuries ago as the first staging post on the Great North road from London to Edinburgh. It is also a town ringed by beautiful villages, including Knebworth, the site of many great, world-famous music festivals over recent years.
I would like to record my thanks to my immediate predecessor, Stephen McPartland. I am not sure how much I have in common with him, apart from our shared birthday and our height—or lack of—but what I do know is that, when he cared deeply about a matter, he was a tenacious advocate for it, including notably in being a champion of those affected by the cladding crisis following the awful Grenfell fire.
I am also mindful that Stevenage has been represented by two amazing women Labour MPs. The first was the redoubtable Shirley Williams, who represented Stevenage up until 1979. In her own maiden speech of 1964, she described Stevenage as a microcosm of modern Britain. That was at a time when the new town of Stevenage was being built, providing the new homes and jobs that attracted people of all backgrounds to start new lives and families there. Our town was, is and always will be a town of aspiration.
Stevenage makes a leading contribution to health and security around the world, whether it is our internationally renowned hub for life sciences, with GlaxoSmithKline being the town’s biggest employer and the brand-new Autolus facility manufacturing T-cell therapies for cancer; or our indomitable defence industry, with MBDA manufacturing the Storm Shadow missiles, which I am deeply proud are being provided by this country to Ukraine to fight back against Vladimir Putin’s horrific invasion, and the Airbus Defence and Space UK headquarters, which provides a quarter of all satellites used in space. They say the sky is the limit; we in Stevenage like to travel that little bit further.
Yet to be at the forefront of modernity, we need to empower people with the ambition, the vision and the skills to make it happen. This was something the next Labour MP for Stevenage, Barbara Follett, championed formidably. In her own maiden speech in 1997, she noted the need to equip more young people to take on the skilled careers that would be possible with the high-tech employers in Stevenage. She was then part of the Labour Government who placed education at the heart of their programme from early years right through to advanced qualifications.
Now the challenge in Stevenage, as across so much of the country, is to ensure that there are homes in which people can grow up, work hard and grow old with dignity. It is a painful irony that the original residents of our new town now watch as their children and grandchildren face down the lost dream of home ownership or even renting a home. That is why I am so pleased that a priority for this Labour Government is to build many more new homes to meet this housing emergency, including new towns just like Stevenage.
I am delighted that another Labour woman from Stevenage, Baroness Sharon Taylor, is a Housing Minister in the other place. I am looking forward to working with her and others in our new Government to help build the homes that Stevenage and our country so desperately need. So I am proud of the legacy of Labour women from Stevenage.
It was pointed out to me recently that I am the first male Labour MP for Stevenage. I have looked into that, and it turns out I am not. That first goes to Philip Asterley Jones, elected in 1945. He deserves to be remembered for championing the building of Stevenage New Town, despite many misgivings at the time.
I then thought I might be another first. One reaction to my election that I had not been expecting came from the country of my birth, Malta, where it has been proclaimed that I am the first Maltese-born Member of this House. I have looked into that one too, and again there was another first—Gerald Strickland, the Member for Lancaster in the 1920s and subsequently Prime Minister of Malta. I can confirm I have no plans to follow his career path.
I think the point in life is that being the first is not as important as acknowledging how you achieve your dreams and ambitions—not alone, but thanks to the support of others. My mum and dad moved to this country from Malta when I was an eight-year-old boy. They worked hard so that my brother and I could wish for nothing. I was also lucky to have teachers who believed in me so that I could believe in myself.
From a young age, my mum and dad instilled in me that, if you see a problem, you roll up your sleeves and you fix it. Since then, I have done just that. I have worked as a solicitor, getting justice for victims of the phone hacking scandal. I also served for over a decade as a councillor and an armed forces champion, helping residents with their problems and focusing on the needs of veterans. As someone who came to this country as a little boy, I have also campaigned for the welfare of child refugees, who have never had the luck and support that I had. It is that instinctive drive to serve and make a difference to people’s lives that brought me to Stevenage, the town of aspiration.
As I talk about championing the needs of residents, I want to touch on the topic of today’s debate—a topic that matters a great deal to my constituents. I am delighted that the very first Bill of this new Government is to improve our railways by establishing Great British Railways and bringing train operators into public ownership. Residents in Stevenage and our villages are strivers: they work hard to build a better life for themselves and their families. Key to that is a properly integrated rail network that is affordable, on time and accessible.
Alongside my strong support for the Bill, I will be lobbying for the restoration of the Knebworth express to bring back a fast train in and out of London to Knebworth station, because those who live in villages have no less aspiration to succeed than those who live in towns. I will also work hard to ensure that accessibility in Stevenage station is a priority, from ensuring a full-time working lift to securing the future of the ticket office.
As I start the work in my constituency of returning the role of MP to its founding purpose, public service, I also stand ready to support our new Government in delivering on the change that our country needs. I ask the new Government just one thing: look back to the great reforming agendas of the Labour Governments in 1945, 1964 and 1997, who built our new town, revolutionised the life prospects of a generation and transformed our public services. Aspiration was their watchword, and aspiration has remained the very essence of towns such as Stevenage ever since. Now look to the present day in 2024: let us recapture the imagination, innovation and vision that our predecessors showed, and carry it forward to transform the lives of this generation and the generations to come.
Siân Berry (Brighton Pavilion) (Green)
I thank all the Members who have given their maiden speeches. It was moving to hear all of them, particularly the hon. Member for Hertford and Stortford (Josh Dean). I am making a note of everybody who mentions youth services, and he did some very good advocacy: he is on my list.
It is great to be speaking on my first Bill in the House, and that it is a Bill that brings passenger railway services back into public hands. The fact that this measure made it through the dramatic sift of Labour policy that took place before the election, and is among the first and most urgent pieces of new legislation we are looking at, is I believe in no small way due to the Secretary of State’s own commitments to this policy and her dedicated internal advocacy for it. I wish that more of her colleagues had been so willing and determined to push for similar Bills to bring other privatised services such as water and the big six energy companies into public hands, but that does not diminish my delight this evening. I recently mentioned to her how much I was looking forward to scrutinising and where necessary helping to improve other upcoming Bills under her remit, including the buses Bill and the more detailed railways Bill. This is all great work.
As far as this Bill’s key principle is concerned, the Secretary of State will have noticed that public ownership is popular with me and is popular with the people. In 2024, that principle is supported for the railways by 76% of the public. That support has risen steadily for the past decade; it was even backed before the election by 60% of those intending to vote Conservative.
Bringing the railways back into public hands has been in my party’s programme for as long as I can remember. It is also close to the hearts of my constituents in Brighton Pavilion, for whom the legacy of the failed policy of privatisation is one of poor services, inefficiencies and very high costs for passengers. An annual season ticket between Brighton and London currently costs my constituents the best part of £6,000. That cost has risen by approximately 40% in the past 10 years—far more than wages in Brighton have risen. In the face of service cuts and failure to invest, passengers have had to form local pressure groups such as the Preston Park Train Campaign to save services. In so many stations, understaffing and disabled access remain dreadful, creating appalling discrimination against passengers—and don’t get me started on toilet provision.
I am not just here to praise the Bill or celebrate its principle. I do have some questions and comments—all to be constructively taken, I hope. The Bill is very short and very simple, and I wonder whether it could benefit from some additional detail and a wider scope. I will keep my comments brief at this stage, but on each point I would welcome more detail from the Secretary of State on her thinking. I also request a meeting with her to discuss the issues before Committee of the whole House.
First, I want to talk about the exceptions from the Bill. From the information I have, it appears that the Bill will not bring into public ownership the regional services currently let by concession contracts, including the Elizabeth line, Mersey Rail and the London Overground, or any of the services on open-access routes, including Eurostar, Grand Central, Heathrow Express, Hull Trains and Lumo. For passengers, hearing the Government promise to bring private operators into public hands, but then hearing that a service they use will be excluded, will be a disappointment. I hope we will hear more soon about how those gaps will be filled.
Also out of scope, as the Bill’s title indicates, are rail freight services. The public might have expected those private operators to be among the first for action, especially as getting freight off the roads and on to rail has so many benefits in addressing road danger, congestion and climate emissions.
Another exception from this Bill to bring passenger railways back into public hands is the rolling stock companies. Quite honestly, most members of the public do not have much awareness of it, but the rolling stock in which we travel is another public asset that is worthy of public investment and should not be held merely for private rent and profit by companies that add no real value to the service. At the very least, the Bill could have included a prohibition on new arrangements of that kind.
Finally, I feel that there is a potential gap in the Government’s plans around rail devolution. The Bill’s definition of “public sector company” will allow franchises to pass only to companies wholly owned by the Secretary of State or her counterparts in Wales and Scotland, not to those owned by other elected bodies whose remit includes, or might in future include, managing transport in an integrated way within an area of the country. I am very interested in further exploring the Secretary of State’s thinking on that, because a Green principle close to my heart is subsidiarity: making sure that ownership and power are devolved to the lowest and most practical level.
In the case of integrated, multimodal transport planning and investment, particularly for day-to-day travel, the best level is often a regional or sub-regional travel-to-work area. At that level of planning, sustainable travel across different modes can be linked up in a responsive network with convenient interchanges, rational timetables and shared ticketing across modes. Profitable commuter routes on a railway might also directly help to cut car dependency in isolated villages by subsidising essential connectivity by bus, for example.
This kind of transport planning is best done alongside and in tandem with planning for new homes and businesses, for which the right scale is also a regional or sub-regional area, working with the involvement of local authorities, people and workplaces. Like many people, I am slightly concerned about the centralising tendency that we can detect in a range of recent actions from the leadership of our new Government; I hope that it will not dominate transport and planning policies in this House. If the Secretary of State agrees to meet me as requested, I will be very interested to hear more about how she expects the upcoming devolution Bill to interact with this Bill and with the future railways Bill in respect of her plans for how centralised the future planning, management and ownership of transport as a whole will be.
Admittedly, the places in England where this kind of devolution applies, and where rail franchises might sensibly pass to companies owned by cities and regions in the near future, are currently very few. However, when we have franchises serving nearby metro mayor areas, such as TransPennine Express and Northern, which are already under the wing of the Department for Transport; when the Mayor of London already has his sights firmly set on taking over specific services; and when there might, as I hope, be greater devolution of powers to combined authorities and areas in the south-east region and Sussex, where I now represent many people dependent on rail services, it does seem strange to introduce a Bill that appears to need amendment to rule in such an exciting prospect. When the Government are about to give more powers to local authorities to run buses, it also seems strange not to help them to work together to run suitable railways. Will the Secretary of State explain what plans there are to better link up railways and bus services? Will she discuss them with me before Committee?
Those are all my comments and questions. I am very much looking forward to the future, and I am looking to help build the best future we can from this new and refreshing approach of public ownership. I reiterate how pleased I am to be making such a speech, rather than one bitterly complaining about a Government who have completely the wrong idea; I hope that my questions and cautions will be taken in that spirit.
Madam Deputy Speaker (Judith Cummins)
I call Jon Pearce to make his maiden speech.
Jon Pearce (High Peak) (Lab)
Thank you, Madam Deputy Speaker, and congratulations on your elevation. I congratulate all today’s maiden speakers, and particularly my hon. Friend the Member for Stevenage (Kevin Bonavia). Stevenage is very lucky to have such a fine advocate. He is an impossible act to follow—perhaps I am like Kula Shaker coming on after Oasis in 1996—but I will do my best.
I assure you that I will be brief, Madam Deputy Speaker. The best advice I had in prepping for this was from a good friend who said, “No matter how good a speech is, no one has ever said, ‘I wish that had been longer.’” [Hon. Members: “More!”] Thank you so much for giving me the opportunity to make my maiden speech on a Bill that is so important for my constituents in High Peak, for the country and for me personally.
When I was young, my father worked on British Rail as a storeman. The stores were vast warehouses teeming with workers in train manufacturing and maintenance. The privatisation of Britain’s railways by John Major’s Government resulted in thousands of job losses. Between 1990 and 1997, the number of rail workers in this country decreased from a quarter of a million to 130,000. Those are not just numbers; they are real lives, like those of my dad’s friends and workmates. The fear that my dad would be next, and about what that would mean for my family, was an unwelcome guest that lingered far too long in our house. Childhood experiences like that never leave you.
The dignity and opportunity of a secure, well-paid job must be the foundation on which we deliver the economic growth that High Peak and Britain need. I look forward to using my experience as an employment lawyer to help us to deliver a new deal for working people.
Were the pain and the sacrifices made by the families affected by the privatisation of our railways worth it? Did privatisation deliver the competition, the greater efficiencies and the better railway services that it promised? The commuters in Glossop, New Mills, Whaley Bridge, Chapel and Buxton will tell you with barely a dissenting voice, “No.” Frequent delays, cancellations and overcrowding have become the norm, while rail fares have increased by more than 40% in real terms, meaning that passengers in Britain face some of the highest fares in Europe. Rail privatisation means pay more, get less.
Research suggests that every pound invested in public transport generates £4 in economic benefits. Since privatisation, too many of those pounds have been going into shareholder pockets and not into improving services for passengers. In 2022-23 alone, the rolling stock companies paid out more than £400 million to their shareholders. That injustice is not fair on my constituents in High Peak, and it is holding back our economy.
High Peak should be the best place to live in the country. We have: strong communities; a rich history of tourism dating back 2,000 years to when the Romans developed the first spa around the warm water spring that still bubbles under Buxton to this day; a rich history in the arts, being home to both Vivienne Westwood and Hilary Mantel; and a rich history in delivering access to nature, being the setting for the mass trespass and Britain’s first national park, the Peak District.
High Peak is the most beautiful constituency in the country. [Interruption.] I am sensing maybe a few murmurings. I have read my brief, and I respect the importance of being accurate, so while writing this speech, I put down my pen and took a moment to gaze out of my window. With the vista of Hope valley in the foreground and the majesty of the tors beyond, I feel comfortable in reaffirming that High Peak is truly without equal.
Sadly, despite our beauty—that is High Peak’s, not my own—we are all too often overlooked. At the northernmost point of Derbyshire, not quite in Greater Manchester, and just on the edge of South Yorkshire, we have been no one’s priority for too long. No more. It is high time that High Peak got its fair share—our fair share of economic growth, our fair share of better public services and our fair share of investment. Integrated transport through Great British Railways, taking back control of our buses and building the Mottram bypass—the latter of which I commend my predecessor Robert Largan on championing—have the potential to be the catalyst, moving High Peak from the edge of everywhere to the economic centre, connecting the two core northern cities of Manchester and Sheffield. That is how we will deliver High Peak its future back, attract business investment, encourage tourism and restore pride in our towns again. That future starts where my story began, with the railways back in public ownership.
Madam Deputy Speaker (Judith Cummins)
I call Claire Young to make her maiden speech.
Claire Young (Thornbury and Yate) (LD)
Thank you, Madam Deputy Speaker, for this opportunity to make my maiden speech. May I congratulate you on your recent election? I also congratulate all those who have made maiden speeches today, particularly the hon. Member for High Peak (Jon Pearce), who spoke so passionately about the beauty of his constituency and the childhood experiences that he brings to this House.
I am honoured to have been elected by the people of Thornbury and Yate to be their voice and champion here in Parliament. Ours is a beautiful and hugely varied rural constituency, with the towns of Thornbury, Yate and Chipping Sodbury and many villages, stretching from Hill, Falfield and Charfield in the north to Bridge Yate, Siston and Wick in the south. To the east is the Cotswold escarpment, part of a designated national landscape. To the west is the Severn estuary, a Ramsar wetland of international importance and formerly home to the Aust ferry, made famous by Bob Dylan.
There is much worth visiting locally, from historic attractions such as Dyrham Park and Acton Court, to the more modern. Bristol Zoo Project carries out important international conservation work, while not far away—I hesitate to mention this, when my leader, my right hon. Friend the Member for Kingston and Surbiton (Ed Davey) might be listening—there is an artificial inland surfing lake called the Wave.
There is a real history of innovation locally, although sadly my own parish of Frampton Cotterell’s claim to the invention of the Stetson hat appears to be little more than an urban legend. However, we can be proud that the pioneer of vaccination, Edward Jenner, started his medical training in Chipping Sodbury. Nowadays, many of my constituents work in cutting-edge industries in our region, such as aerospace. With a background in maths and software engineering, I take a keen interest in seeing those industries flourish, and I want to ensure that our young people can benefit from the opportunities they bring.
My constituency is of course more than its landscape and history; it is the people who live there and their fantastic community spirit. I saw that in my own village during the pandemic, when hundreds of volunteers rallied to help others. Whether it is the big lunch in Chipping Sodbury, the Yate Ageing Better festival, Thornbury carnival or any myriad other events and groups, they all contribute to making the constituency a wonderful place to live.
I thank my predecessor Luke Hall, who served Thornbury and Yate for nine years, during which time he championed neonatal care leave and held posts in the Department for Education and the Ministry of Housing, Communities and Local Government. I wish him and his family all the best for the future. I also thank his predecessor, the former Pensions Minister Sir Steve Webb, who has been a great source of wisdom for me and is fondly remembered by many constituents. He set a very high bar for all his successors, and I will do my best to meet it. While I am thanking people, I put on record my gratitude to Councillor Maggie Tyrrell, who has recently succeeded me as the leader of South Gloucestershire council. I know that the council is in safe hands as I bring that experience to this place.
I am grateful for the opportunity to make this speech in this important debate, because if we are to tackle the climate crisis and cut congestion on our roads, we must get rail services back on track to give people genuine alternatives to get around effectively. There are currently three railway stations in my constituency. Yate station was reopened in the 1980s, and we desperately need the proposed redevelopment. I will also be seeking to ensure that the funding for half-hourly services is extended beyond the current end date of 2026. That will benefit not only Yate, but provide an hourly train for the new station planned at Charfield.
The station at Pilning is a parliamentary station, with just one train running a week to avoid formally closing it. Its location, near the growing industrial location of Severnside, means that if properly reopened, it is prime placed to help the many workers who travel from south Wales to make the trip without a car. The third station is Severn Beach. Once a seaside resort, the line now serves commuters. However, commuters can be left disappointed by flooding on the line, as well as the fact that the service is not more frequent. Rail campaigners are also keen to see other stations reopened, such as Coalpit Heath and Thornbury, but for that to be possible, we need national investment in Westerleigh junction to increase capacity and unlock this potential. I hope that the Secretary of State will commit to making that part of the integrated infrastructure review that was referenced earlier.
As my hon. Friend the Member for Bath (Wera Hobhouse) said, ultimately passengers are not interested in who runs the trains; they simply want them to run on time and for the tickets to be affordable. Given the continued squeeze on people’s finances, we need an immediate freeze on rail fares and our fragmented ticketing system needs simplifying to cut costs for commuters. We also need to think about integration with other forms of public transport. In my constituency, we have seen serious cuts to local bus services, with many villages left with no regular buses at all. My aim in this place will be to champion the rights of people to have affordable and green methods of transport, whether they live in rural or urban areas.
In conclusion, I promise to work tirelessly for my constituents, not only on fixing our railways, but on other issues too, such as the fact that our schools are among the lowest funded in the country and that it is almost impossible to register with an NHS dentist locally. I look forward to working constructively with right hon. and hon. Members across the House to address these problems and ensure that the people of Thornbury and Yate get the fair deal they deserve.
Madam Deputy Speaker (Judith Cummins)
I call Gurinder Josan to make his maiden speech.
Gurinder Josan (Smethwick) (Lab)
Thank you, Madam Deputy Speaker, for calling me to make my maiden speech in this august Chamber. I join other hon. Members in welcoming you to your place, and the ministerial team and the shadow ministerial team to their places as well. I congratulate all hon. Members who have made their maiden speeches today; we have heard excellent contributions. I thank, in particular, the hon. Member for Thornbury and Yate (Claire Young), who described her constituency so eloquently that it makes one want to visit, but those who know me will know that a visit by me would be accompanied with a Labour party campaign.
May I also please take this opportunity to thank all the staff across the parliamentary estate who have worked incredibly hard and always courteously to help me and, I am sure, many other hon. Members to establish ourselves in this place?
I also take the opportunity to thank the voters of Smethwick, who have entrusted me with the honour and responsibility of being their elected Member of Parliament. It is indeed a great honour to stand here today, and I give the voters my word that I will work to repay their trust to the best of my abilities.
Of course, I would not be here without the support of my family. My grandfathers, Bhan Singh and Niranjan Singh, arrived in the UK in 1956 and 1957 and carried out manual jobs in foundries and brickworks respectively. They came with hope for a better life for them and their families, but they also came with a strong belief that, with hard work, they would be able to forge a better life in Great Britain.
My father, Swaran Singh Josan, was 10 years old when he arrived in Smethwick in 1958. He had most of his education here, and he went on to work as an engineer for the Post Office, which went on to become British Telecom. Alongside that, in 1975 he, my mum and my uncle established a family business—a hardware store and plumbers’ merchant—on the high street in Smethwick, and my brothers continue to run the business today. My father was also active in his trade union and the Labour party. He was elected to Sandwell council in 1986 and subsequently three times. Unfortunately, he passed away in 1999, when he was the cabinet member for housing in Sandwell. Being in this place was always his dream. I believe that he would be proud of this achievement.
It is a convention of the House to speak in good terms about one’s predecessor. My predecessor is the right hon. John Spellar, and those who know him will know two things. First, it does not require convention for me to speak well of him. Secondly, bearing in mind that his phone ringtone is the theme tune to “The Godfather”, it is a convention that I dare not ignore. John was first elected to the House in a by-election in 1982 in Birmingham Northfield. He was then elected as Member of Parliament for Warley West in 1992, and for Warley in 1997. In total, John gave over 32 years of service to the House, during which he served in ministerial and shadow ministerial roles. In addition, he gave stalwart service to the people he was elected to represent and is always greeted fondly across the whole constituency. John also played a considerable role over all those years in working to keep the Labour party in the centre ground—the ground where elections are won and lives can be changed for the better. He leaves me with incredibly big shoes to fill. I am delighted that he is being elevated to the other place.
Smethwick existed as the name for the constituency between 1918 and 1997 and has been brought back following the recent boundary changes. The constituency consists of the former Warley constituency and most of the Blackheath ward. It includes the football ground of West Bromwich Albion—the Baggies. It is an extremely diverse place with a relatively young demographic and a significant black, Asian and minority ethnic community, particularly from the Muslim and Sikh backgrounds.
Smethwick was mentioned in the Domesday Book. Its people are a proud people, who are particularly proud of our industrial heritage. As an example, Smethwick is the location of the Soho Foundry, created by Matthew Boulton and James Watt in 1775, where the oldest working steam engine in the world was built.
Historically, in addition to my predecessor, Smethwick also saw Christabel Pankhurst standing in the 1918 general election just after women were given the vote. Oswald Mosley was the MP between 1926 and 1929. Smethwick also had the shortest serving MP ever elected. Alfred Dobbs was elected in the 1945 general election. However, the day after the election he was killed in a car accident on his way to Westminster. Being aware of that record, I waited three days after the election before driving extra carefully down to Parliament.
Perhaps the most infamous previous MP for the seat was Peter Griffiths, the Tory party candidate who was elected in 1964 after running a disgraceful and nakedly racist campaign with a disgusting slogan, which I will not repeat as it used the racist N-word. The election and racial tensions at the time prompted a visit a few months later to the constituency by Malcolm X, which was just about a week before he was killed. Thankfully, Peter Griffiths’s term was brought to an end by Andrew Fauld, who defeated him in the 1966 general election. Smethwick was undergoing huge changes at the time. In 1967, it saw the appointment of the first black headteacher in the UK, Tony O’Connor, at Bearwood primary school.
The general election was about change. After 14 years, the British people have voted for change and given a huge mandate to the Prime Minister and the Labour party. The recent King’s Speech contained Bills that will bring huge change to the country, our public services and the lives of the people we represent. The Prime Minister can be sure that his programme has my full support.
Among those Bills, the Passenger Railway Services (Public Ownership) Bill will bring much-needed change on our railways. Its provisions that will bring franchises into public control and, along with provisions that will set up Great British Railways, were widely discussed and understood by voters during the general election. It is clear that voters support the changes proposed in the Bill.
For me, the election was also about change across our communities. One example of that change in Smethwick is the fact that 60 years after that disgraceful racist campaign, I—a child and grandchild of immigrants—can be elected to this House. That change is the result of many people across Smethwick and Sandwell working hard to build relationships and understanding across all communities and ensuring that we deliver on the aspirations of all our people.
Smethwick is an incredibly diverse yet harmonious place. It is my community. By that, I mean it is the street I live on, the park opposite, the church on Church Hill Street, the Jamia mosque on Oldbury Road, the Bangladeshi mosques in north Smethwick, the Somali community centre, the Smethwick Asian Sheltered and Residential Association, SAFS caring family support, St Albans community centre, Better Understanding of Dementia for Sandwell, the Royal British Legion branches and clubs, Brushstrokes, Brandhall Labour club, the schools where I am a governor, the gurdwaras where I pray, the high street where I worked and so much more. That is my community.
Yet in Smethwick we also have our challenges. Some of those spilt out during the election, as they did in other places. The election saw the rise of smaller parties and independents, including those driven by foreign policy issues and others such as the Reform party. I am chair of trustees at Hope Not Hate Charitable Trust, and I see how hate and aggression increasingly define our public discourse, particularly on online platforms, but also more and more in person. It is a responsibility of all of us to challenge and address that, and to ensure that kindness is the basis of all that we do. To those who did not vote for me in Smethwick, I say: I am still your Member of Parliament and I still want to talk to you about the issues that concern you.
Many Members have said that being in this place is the honour of our lives, so over the weekend I thought about that and questioned why we say it. What came to my mind is that people have voted for us—they have gone out there, put a cross by our names and put their trust in us. We are in the mother of all Parliaments, and we will make decisions that will change this country. Those are all reasons why it is a real honour to be here. But the biggest reason why it is an honour to be in this Chamber is the people. We have heard so many excellent maiden speeches over the past couple of weeks, which signify the strength of this Chamber. The Chamber without its people is just Benches, and Benches do not do anything. Institutions without people in them do not do anything. It is the people who will bring change. The honour is being here alongside so many fantastic people. I may disagree with those on other Benches, fundamentally and robustly, but it is an honour to be here alongside every single one of them.
I have always been driven by a strong sense of humanity, fairness and justice. My upbringing and my Sikhi faith are key to my beliefs. I am reminded of the line in Gurbani written by Guru Nanak:
“Ham Nahi Changae, Bura Nahi Koi.”
I am not good; no one is bad. That draws attention to the equality of all of us, regardless of any of our attributes. A good friend in interfaith circles describes Sikhi in a four-letter word: love. We believe that God is omnipresent, across and within all of creation. So to love God is to love other people. For those of no faith, it does no harm to love others in any case.
I consider myself incredibly lucky. I have the incredible support of my family: my wife Harvinder, my son Pavandeep, my daughter Gurkirta, my mum Bhajan Kaur Josan, my nephews Gagandeep, Puneetpal and Ishmeet, who are all here in the Gallery. I have been elected to represent a constituency that is embedded in my heart. I sit on the Benches of a Government who will serve the people. I know that there is incredibly hard work ahead; that there will be disagreements and robust words, and difficult decisions will need to be made. But I am committed to serving this House and the voters of Smethwick to the best of my ability.
Olly Glover (Didcot and Wantage) (LD)
I congratulate you on your election to the Chair, Madam Deputy Speaker. I also congratulate the Secretary of State for Transport and her colleagues on their appointments, and I wish them all the best.
I will start by giving the House a commitment that I will not make any laboured or tedious comments about curly British Rail sandwiches. I welcome the fact that the new Government are giving legislative time to transport at this early stage, given that it is a vital policy area that is often neglected—some might even consider it a Cinderella topic for this House. It is a positive contrast to the previous Conservative Government, who presided over industrial relations chaos, utterly incomprehensible contract extensions for failing train operators such as Avanti West Coast—which many Members have been plagued by—and CrossCountry, and a lack of any meaningful fares or industry reform.
I am one of few Members of this House to arrive here following a career on the railways. I pay tribute to the hon. Member for Smethwick (Gurinder Josan), and I commend him for his excellent speech praising the diversity of his seat. I have had the privilege of visiting Soho train maintenance depot during my career on the railways in the west midlands. I would like to give some insights from my professional experience working both for state-owned Network Rail and private sector train operating companies.
It is important for everyone in this debate to remember that nearly all the infrastructure and the operation of a third of all daily train services are already publicly owned. The previous Labour Government rightly took action following the safety and financial failures of private sector Railtrack by creating Network Rail in 2002, which was quickly able to tackle safety and performance issues. However, my experience of two stints working at Network Rail for a total of 10 years is that, as a very large, publicly owned organisation, at times, silo working and bureaucracy can be barriers to achieving results.
Some of the issues facing Network Rail either in or near my constituency include infrastructure reliability problems on the great western main line, severely overrunning engineering works affecting the Botley Road and many local residents in Oxford, and a very long construction processing for Reading Green Park station. It is important to note that being in the public sector does not inherently make everything better. In the privatised train operating companies that I worked for, some of the main barriers to progress were the result not so much of them being private sector, but the lack of incentive to invest due to short franchise or contract terms, and micromanagement by the Department for Transport and the Treasury.
In September 2013, I joined London Midland—a train operator that notionally was in the last year of its franchise. That meant that key investment decisions were deferred, such as on-train wi-fi, timetable improvements and car park enhancements. It felt as if I was caught in a “Star Trek”-style temporal paradox, since when I left London Midland in May 2017 it was still in the last year of its franchise, as no decisions had been made about the franchising process. That is an example of how the potential private sector benefit to the railway has often not been realised because of the flawed approach to franchising, rather than the nature of the private sector.
There are examples of positive private sector contributions, perhaps the most significant of which is the benefit of Chiltern Railways’ 20-year franchise, which saw investment in new stations at Warwick Parkway and the Evergreen upgrade of the Chiltern main line, both of which delivered significant passenger benefits and were genuinely heavily funded by the private sector. Had we had more long-term franchises like that, things might be very different today.
The Bill will not tackle the issue of trains being owned privately and leased back, often increasing the whole cost to operators. The current leasing arrangements can also create perverse incentives on rolling stock retention as a result of cliff edges imposed by lease durations and renewal dates. This has created shortages of capacity on a number of parts of the network in recent years, as short-term financial decisions have been taken to avoid rolling stock lease extensions—for example, on Southern with class 455 trains and Great Northern with class 365 trains.
Government plans to leave freight and open access operators in private hands may indicate inconsistency with the view that the private sector cannot deliver good services. Most seriously, the state versus private sector debate does nothing to tackle the lack of clear vision for what the Government want the railway to achieve or deliver. As other Members have said, fares continue to be complicated and often expensive. There is a lack of integrated timetables within the railway and with other transport modes, and the role of the Office of Rail and Road regulator needs examination.
I am therefore pleased that the new Government have further plans that I hope will address those points. I implore them to move beyond the public versus private debate and focus on what current and prospective rail users need. Doing so will be crucial to achieving a real focus on customer service, which is needed to grow patronage and achieve modal shift, so that the railway can thrive as part of a wider, sustainable and efficient transport system.
Madam Deputy Speaker (Judith Cummins)
I call Laurence Turner to make his maiden speech.
Laurence Turner (Birmingham Northfield) (Lab)
Congratulations on your election, Madam Deputy Speaker. It is a privilege to follow so many excellent maiden speeches this evening, including from my hon. Friends the Members for Hertford and Stortford (Josh Dean), for South Ribble (Mr Foster), for Stevenage (Kevin Bonavia), for Smethwick (Gurinder Josan) and for High Peak (Jon Pearce), and the hon. Members for Thornbury and Yate (Claire Young), for Taunton and Wellington (Mr Amos) and for Brighton Pavilion (Siân Berry). I apologise if I have missed any. They were a tribute to the wealth of talent and experience in this Parliament.
I am grateful for the opportunity to make my first speech in support of this Bill, which will hopefully lay the permanent way to better value for taxpayers and better passenger services. Transport has sometimes been seen in this place as an unfashionable Department—a stopping-off point for ambitious politicians on the way up, and occasionally on the way down—but it is clear that this attitude is not held by this Front Bench team or this new Government. There is, however, some historical basis for that view. When Barbara Castle was appointed Transport Minister, Harold Wilson told her:
“Your job is to produce the integrated transport policy we promised in our manifesto. I could work something out myself given half an hour.”
When Nicholas Ridley told Margaret Thatcher that he wanted to privatise the railways, she responded:
“Railway privatisation will be the Waterloo of this government. Never mention the railways to me again.”
Down the years, hon. Members on the Conservative Benches must have privately wished that Mrs Thatcher’s view had been taken to heart by those who came after. In fact, given the previous Government’s record of reclassifying Network Rail into the public sector, abandoning the traditional franchising model and nationalising a quarter of passenger services, I half expected to see Conservative Members joining Labour tonight in support of the Bill.
It was a privilege to work as staff in the shadow Transport team during some of those long years in opposition. May I take this opportunity to say how welcome it is to see the Under-Secretary of State for Transport, my hon. Friend the Member for Nottingham South (Lilian Greenwood) in her place? She brings real expertise to the role from her time as Chair of the Transport Committee and in the shadow Transport team. She will be an outstanding Minister, and I am grateful for her support and guidance down the years.
Another Shadow Transport Minister in that team was Richard Burden, my Labour predecessor for Birmingham Northfield. Richard ably represented Northfield for 27 years. He is well remembered in this House for his boundless enthusiasm for the motor industry, and for his steadfast commitment to social justice, which has continued into what cannot be called a retirement, through his activism in pursuit of better local health services and support for the humanitarian cause in Palestine. His support meant a lot to me during the campaign, and I am sure his friends on both sides of the House extend their good wishes to him.
I also want to pay tribute to my immediate predecessor. In the space of just one Parliament, Gary Sambrook became well known locally and, through the 1922 Committee, in the Conservative party nationally. He and other candidates fought a campaign that was untouched by the disgraceful tactic of intimidation that was witnessed elsewhere in Birmingham and which must have no place in our public life. I am certain that this is not the end for Gary in Birmingham politics, and I wish him well.
To talk about Birmingham is to tell a tale of two cities. That is as true of the Northfield constituency as it is elsewhere. Pockets of relative affluence sit cheek by jowl with deprivation. The historic village centres of Kings Norton and Northfield lie a short distance from the new estates, like Weoley Castle, that were built to serve the needs of Birmingham’s growing economy. The fortunes of the constituency rise and fall with Birmingham, but the seat is also defined by its outer estates—New Frankley, Rubery and Allens Cross—which are distant and distinct from the city centre. All these communities face common challenges, including crime and antisocial behaviour, and the decline of the traditional high street. They have been hit hard by cuts to neighbourhood policing and by the decision last year to not proceed with the regeneration of Northfield’s high street. There is much to do.
For most of the constituency’s history it was best known for the Longbridge car plant, which also drew in workers from the surrounding areas of West Heath, Rednal and beyond. For 100 years, Longbridge paid handsomely into the national purse, and it was essential to our defence in times of crisis. During the second world war, Longbridge and its shadow factories produced many of the armaments and aircraft that kept our nation free. If the House will excuse a diversion, I am reminded at this point of my grandad’s story, often repeated with pride to us as children, about his time stationed at the air defences at Billeseley Common, when he—almost—fired a rocket at an encroaching German plane.
The site that began as the Austin works was an important part of our national life. At its peak, it employed some 25,000 people. Models from the Austin 7 to the Metro became part of our shared culture. It is hard to believe that next year will mark the 20th anniversary of Longbridge’s closure. That occasion must be marked appropriately in Birmingham and in Parliament. The site is now home to an ambitious redevelopment project and, importantly, some manufacturing jobs are returning, but travel just a short distance and the scars of that closure are still plain to see. The male employment rate remains a staggering 10 points lower than in Birmingham as a whole. Shamefully, average monthly wages are £300 lower in the constituency than they were in 2010, after inflation. The scourge of in-work poverty is never far away.
Today, my constituents are most likely to be employed in public services. I am proud to be the son of two teachers even if, sadly, the headquarters of the NASUWT, the Teachers’ Union, which my parents were members of for many years, is just over the border in the neighbouring constituency of Bromsgrove. There will be more to say—much more—in this Parliament about the funding and delivery of services in Birmingham. It is enough to say today that after 14 years of severe cuts, the second city is bleeding, and I welcome the statements that the new Government have made about the importance of putting local government funding on a sustainable footing.
The new Government’s plans to establish a fair pay agreement for adult social care, and to reinstate the school support staff negotiating body, will also make a real, material and long overdue difference to thousands of low-paid workers in the Northfield constituency, most of them women, who I was proud to help represent as an officer of the GMB union, and whose skills and professionalism have been undervalued for too long.
If I could achieve one thing in the time I have in this place, it would be to secure improvements to special educational needs and disabilities provision. It is a cause that is close to my heart: I was one of those children. I know what it means to have to fight to avoid being defined by other people’s low expectations. I know the stigma that is the mark of attitudes that are still common and from words that I will not repeat in this place. I wish that I could say otherwise, but it never leaves you. I know, too, that a child’s life can turn on access to an identification or a single decision about adjustments and resources—or even for the want of a few encouraging words. So if I speak for a moment in anger, it is because too many children and families in Birmingham and beyond face barriers that are higher now than they were 25 years ago, in breach of the promise that life for each generation will be better than the last. It is not enough to fight for people within a failing system; we have to change it. That is one of the causes I came to Parliament to advocate for, and I welcome the commitments on SEND made by the Education Secretary and the Prime Minister in the early days of this Parliament.
I would like to end by talking about family. Before me came generations of factory workers, electricians and shopkeepers, painters and polishers, cleaners and coachbuilders, jewellery makers and japanners—some escaping famine’s shadow—who were born in Birmingham or who came to call the city their home. In the last few weeks, I have thought about those I knew and those I did not, and what they might have said if they could have seen this day, just as the hard accumulated years of millions of working lives form the prologue to the new deal for working people and the history that this Labour Government will make. I have thought, too, about public service—about the challenge of proving to be equal to the task ahead and to the hopes of the people who trusted us to represent them in this place; Madam Deputy Speaker, I hope to be.
Madam Deputy Speaker (Judith Cummins)
I call Brian Mathew to make his maiden speech.
Brian Mathew (Melksham and Devizes) (LD)
Thank you very much, Madam Deputy Speaker, and congratulations on your new role. I also congratulate the new Secretary of State.
I thank all those who have made maiden speeches, including—I have a list, too—the hon. Members for Hertford and Stortford (Josh Dean), for South Ribble (Mr Foster), for Stevenage (Kevin Bonavia), for High Peak (Jon Pearce), for Smethwick (Gurinder Josan) and for Birmingham Northfield (Laurence Turner), and my hon. Friends the Members for Taunton and Wellington (Mr Amos) and for Thornbury and Yate (Claire Young).
I welcome this debate on passenger railway services, as one of many railway users who all too often finds himself standing up on the Great Western Railway service to London from the west country. We need a better service and whatever makes that happen is, to my mind, welcome. Also welcome would be the opening of a new Devizes Parkway railway station.
I welcome the Chancellor’s statement earlier today concerning the review of the Stonehenge tunnel. As a Wiltshire councillor, I have long opposed this abomination of a scheme, given that alternatives exist to solve the problem on the A303—because of its denial of the birthright of everyone, since time immemorial, to see the stones as they travel the ancient way across Salisbury plain by car, by HGV, by charabanc, on horseback, in a cart or on foot, because of the damage that it presents to the environment and, indeed, because of the loss of world heritage status.
Over the last year I have taken part in a number of water blessings with druids, shamans and interfaith practitioners—including Andrew Rumsey, the Bishop of Ramsbury—partly to celebrate our sacred rivers and streams, but also to highlight the pollution threat to our waterways. One of the springs, the Blickmead, is directly threatened by the building of the Stonehenge tunnel. I can testify to the presence of the two huge pike that we witnessed circling the pool below the spring like nature’s guardians. I hope that their future can be assured, and a new way found both to protect and to celebrate our beautiful planet and all the life that lives on it.
In a maiden speech, it is traditional that we mention the good work of past MPs. In my case, the wonderful new seat of Melksham and Devizes is made up of three former constituencies. I should mention James Gray, once of North Wiltshire and known by some as the Minister for Vellum because of his valiant efforts to maintain the use of that material in manuscripts, and the right honourable Michelle Donelan, the former Secretary of State for Science, Innovation and Technology as well as the former MP for the old Chippenham constituency. I first met Michelle in the street in Chippenham some years ago, shortly after she had been first elected. Thanks to a Lyme disease campaigner who had visited her surgery, she had realised that she was suffering from the disease herself. Her openness about that fact has helped to raise the issue of Lyme disease and the importance of early diagnosis, as well as the need for more research on the long-term treatment for victims of the disease, and I commend her for this. The third former constituency to make up Melksham and Devizes was, of course, Devizes itself, and I look forward to meeting its former MP, who is, of course, still in the House as the hon. Member for East Wiltshire (Danny Kruger), to discuss issues of casework.
The Melksham and Devizes constituency stretches from my own Wiltshire council ward of Box and Colerne across the beautiful Bybrook valley and Isambard Kingdom Brunel’s iconic Box tunnel all the way to Devizes, via Bradford-on-Avon, Melksham itself and some of the prettiest villages in England, including Steeple Ashton, Urchfont, the Lavingtons, Seend and Bishops Cannings, to name but a few. Despite the beauty of the place, these communities face the same problems as much of the rest of the country. I have already reached out to the Secretary of State for Health and Social Care to ensure that NHS issues across my constituency are dealt with, including the plight of the GPs of the Three Shires Group of rural surgeries, who have had to take a two-month salary break to keep their surgeries solvent. In Melksham there are calls for the return of basic services at the local hospital, and across the constituency NHS dental services are in freefall, with people wondering how they will be able to afford the cost of basic treatment.
I want to end by reflecting on the words of the late Jo Cox, who famously said that there is more that unites us than divides us. There is also more that we can achieve across parties by working together on issues such as health and social care and, indeed, social housing provision. I look forward in this Parliament to doing just that, not only with members of all parties in this place but with councillors of all parties, across my constituency.
Rachel Hopkins (Luton South and South Bedfordshire) (Lab)
I congratulate all those who have made maiden speeches this evening, especially my hon. Friends the Members for Hertford and Stortford (Josh Dean) and for Stevenage (Kevin Bonavia), fellow eastern region MPs with whom I have campaigned long and hard. It is a delight to see them here in the Chamber.
It is a pleasure to speak in this important debate, and to express my full support for the Bill. I welcome the ministerial team who are taking forward one of the early Bills of a Labour Government. For too long, my constituents have paid high fares in exchange for unreliable train services and crumbling infrastructure. Having commuted throughout my working life—nearly 30 years—I have experienced at first hand the effects of three decades of a fragmented, failing privatised system. Under the Tories, fares rose almost twice as fast as wages and cancellations soared to record levels, while failing train company executives boasted of receiving “free money” from taxpayers. The privatisation experiment has failed; Britain’s railways are broken.
UK Government subsidies and passenger fares have benefited not only private companies but foreign Governments. Trains on UK railways are almost entirely owned by foreign state entities. Ironically, that means that my commuting constituents are effectively subsidising rail passengers in France, Germany and Italy, as was explained so well earlier by my hon. Friend the Member for Middlesbrough and Thornaby East (Andy McDonald). Labour’s bold and progressive plan to bring rail passenger services into public ownership—a popular policy supported by 54% of voters in May—will address and rectify those failures. I might add that it is because we have left the European Union that we now have the freedom to implement this reform without being constrained by the EU’s third railway package, which requires that passenger services be opened up to international market competition and the extraction of profit that entails.
Our Bill will save taxpayers tens of millions of pounds annually that are currently paid out in fees to private sector operators, as demonstrated by the now publicly run LNER, which submitted a £40 million dividend to the Department for Transport in 2022. This money will be used to introduce a best-price guarantee for ticketing, to improve timetable co-ordination, to reduce delays, and to grant automatic refunds for delays and cancellations, putting passengers back at the heart of the service. Our plan will also benefit workers across our rail system, including some of my friends, who are very loyal to our railways.
I commend both ASLEF and the RMT for their long-standing campaigns in support of the renationalising of our railways, and I stress the importance of working closely with unions to ensure fair conditions and respect for all rail workers. I, too, refer Members to my declaration of interests, and I am proud to do so. While this Bill addresses passenger services, it is only the beginning of our plans. The wider future railways Bill will deliver root-and-branch reform of the railways, and will be crucial to reviewing rolling stock and rail freight operations to ensure that environmental issues are taken into consideration, and to working towards a fully integrated railway system.
Given that we are talking about railways, I must take the opportunity to highlight, briefly, the state of Luton station. Despite the long-awaited Access for All commitment to the installation of lifts—due to start this summer—the station is not fit for purpose for the 21st century, and needs full regeneration. Having campaigned on the state of Luton station since I was first elected as an MP—with a few small wins, including ensuring that part of the station canopy was fixed and successfully keeping the ticket office open—I should like to raise the issue of its full regeneration with the new ministerial team and their officials, and I will be in touch with the new Secretary of State to raise it on behalf of my constituents.
I am very pleased that the Labour Government will provide a reliable, safe, efficient, accessible and affordable transport system that supports our five national missions by, for example, promoting greener transport options and facilitating key workers’ commutes. This Bill marks a historic first step towards creating an integrated, publicly owned railway, an achievement of which Labour can be truly proud.
Graham Leadbitter (Moray West, Nairn and Strathspey) (SNP)
First, I will cover some of the maiden speeches that have been made by various new Members. I had the pleasure of doing mine in the King’s Speech debate, and I think we have had nine so far this evening—well done to everyone. I found it quite nerve-racking, and it is a bit easier speaking a second time. I will not mention all the names of Members’ constituencies—other people have done that—but the issues covered struck a chord with me. We heard from a former council leader, and I am a former council leader. National parks were mentioned, and I have a national park in my constituency. New stations were also mentioned, and I have one of them as well. Many things were covered in the maiden speeches—Bob Dylan and Knebworth particularly took my fancy, as I am a bit of a rocker.
To return to the subject at hand, two of the maiden speeches mentioned water quality. With a nationalised water company in Scotland, we have some of the best water quality in the UK and among the lowest number of leaks. It is also one of the lowest-cost water companies in the UK, which ties in neatly with rail nationalisation. I am sure that those on the Government Benches will be pleased to hear the SNP supports that, as we are proud of introducing it in Scotland two years ago. I am pleased to see a Government in place who want to go down that route, which is very positive.
In the past two years, we have seen punctuality and reliability improve. ScotRail is now fourth out of the 24 franchises on performance, with a significant reduction in serious delays and cancellations. I do not really understand the argument that has been given by some of those on the Conservative Benches, who say that nationalisation—as opposed to privatisation and private profits—is not the answer and might not deliver lower prices. One big benefit as a result of nationalisation is that we have been able to run a pilot on removing all peak fares across Scotland, which has been so successful that it has now been extended. I hope that we will be in a position to make that a permanent feature. It has been very well received and is a demonstration of how we can drive down fares in a public ownership model.
As I have said, I certainly welcome Labour’s following suit. My understanding from colleagues in the Scottish Government is that there has been really good communication between the two Governments, which is very welcome. I cannot imagine that the experience would have been perfect for colleagues in the Scottish Government—it had not been done before—but I hope that sharing what happened two years ago and in the interim will be helpful and that we can find common ground.
I hope that other proposed legislation will address one area that I have concerns about. At the moment, the Bill applies only to train operating companies, but the most profitable part of the system is the rolling stock leasing companies, which a couple of Members mentioned. They generate hundreds of millions of pounds of profit for the private sector and lead to soaring leasing costs, private investment and high prices. The rewards have been privatised but the risks have been put on the public purse. Some £1 billion was paid out in dividends during covid, with the bulk going to jurisdictions such as Luxembourg and Jersey.
That brings me to the point that the Chancellor made about tax avoidance and trying to increase the amount taken by His Majesty’s Revenue and Customs. I have given an example of companies taking huge amounts of money out of the private sector and paying out those dividends in other jurisdictions. I would like to see that tackled, and I hope that the Minister will cover that in summing up.
I will say a final thing about public investment. We have managed to open up three new lines in Scotland: the Borders railway, the Levenmouth railway and the Alloa railway. We have opened numerous new stations and there is a huge amount of enthusiasm, as many Members will know. Few bodies are as enthusiastic as those involved in rail. I have two historic railways in my constituency. Many historic railways offer public services and would like to continue—or grow into—doing so in future. There is an opportunity to harness that enthusiasm and energy, but we need to shift the dial on capital investment in public infrastructure. I hope that is something the Government will tackle rapidly, because we need capital to make progress.
Apsana Begum (Poplar and Limehouse) (Ind)
I congratulate you on your election, Madam Deputy Speaker, and hon. Members on delivering their maiden speeches today. I thank you for calling me to speak in this important debate on the Bill, which is widely welcomed by rail trade unions and will ensure that train services will be brought under public ownership as private companies’ existing contracts expire.
Many of us have long campaigned for the renationalisation of our railways, so today marks a hopeful turning point for our transport system. Time and again, privatisation has proven to be a failed imposition that has resulted in fare increases, falling real wages, a declining quality of service, and crisis after crisis in timetabling. At the crux of the privatisation problem has been the pursuit of profit at the expense of the taxpayer, railway workers and passengers. The negative impact of privatisation is far-reaching, as non-profitable railway lines are discounted, fares are raised above affordability or service quality is compromised. It is no wonder that distrust of the railway industry is rife, and that there has been consistent, long-term consensus for an integrated, publicly owned railway.
Compared with privatised railways, a publicly owned railway does not need to be driven to maximise profits through cuts or price hikes. Instead, a publicly owned railway enables transparent costing and sustainable funding. It means public investment in rail services, and properly staffed trains and stations. It means investing in green transport, and creating green jobs that are both socially and economically sustainable. It also means—I say this as somebody who campaigned alongside the RMT against ticket office closures—ensuring accessibility and reflecting the needs of a diversity of rail users, including disabled people. And, yes, public rail investment will aid much-needed economic growth.
People are absolutely desperate for material change. This Government promised to deliver investment, public ownership and employment rights, and the Bill before the House today is a positive first step towards a fully integrated, publicly owned railway. Our railways exist to support us, and people, not profiteering, should be at the heart of our railways.
Matt Turmaine (Watford) (Lab)
Thank you very much, Madam Speaker, and congratulations on your election. I also thank my right hon. Friend the Secretary of State for Transport and her ministerial team for the opportunity to make my maiden speech as we debate this important Bill. I would also like to thank the hon. Member for Melksham and Devizes (Brian Mathew) for his maiden speech, which was informative and entertaining. I did once find myself in Devizes under very unfortunate circumstances—perhaps I can share that in the Tea Room at a later date.
Watford is fortunate enough to be served by three train routes into London. I have still to develop a model of which one is the right one to use, because whichever one you end up on, you should have picked the other one to go into town as a result of delays. My agent once told me that there is only one thing certain about train routes and bus services, which is that they get cut, so it is fantastic to be here with a team on the Front Bench who are going to make a massive difference and turn that state of affairs around.
I rise to make my maiden speech to the House. Watford is a town located in Hertfordshire, just within the M25. Watford skews quite young, with 69% of the population under 50 years of age. It is also much more diverse than other parts of the eastern region in which it is located, or indeed the rest of the UK. We love our diversity; it makes Watford a fantastic, culturally diverse place to live. Politically, Watford is a marginal bellwether seat, which was absolutely fantastic for me at this election. Of course, it was probably absolutely fantastic for the Conservative candidate in 2019, but we shall not dwell on that. It is also an archetypal definition of a two-horse race, and I clearly have an interest in making it much less marginal if I can.
Watford’s political status goes back through time, and observing it is like watching the coming and going of political epochs. The last time the bellwether trend was confounded was over half a century ago, in 1970, when Mr Heath waltzed into Downing Street with his piano while Mr Raphael Tuck, a popular constituency MP, held on to the seat of Watford for Labour, but only by 76 votes. So the trend was clearly visible at the time. In 1951, Mr John Freeman also kept the seat for Labour while the Conservatives went into government. He had been a war hero whose wife had to deliver his candidate selection speech because he was busy in mainland Europe as part of the second world war effort.
I would like to pay tribute to my predecessor, Mr Dean Russell. Mr Russell introduced a private Member’s Bill, which is due to come into law later this year. His tips Bill was not—as I, a newly elected MP, might have hoped—a set of hints and advice on how to get from one side of the parliamentary estate to the other. Nor was it a recommendation on where to go for the best cup of tea or on how to get a space on a Bench in here during a particularly busy debate, much to my disappointment. In fact, Mr Russell’s private Member’s Bill will ensure that people working in hospitality who may be in receipt of a tip from a paying customer are entitled to keep it, so it is actually a very good private Member’s Bill indeed. It would certainly have been welcomed by me when, many years ago, I worked in hospitality, a sector in which many workers in my constituency earn their living.
Mr Russell was preceded as the Member of Parliament for Watford by Richard Harrington, who served as Minister for State for refugees, helping to set up a settlement programme for Ukrainian refugees in the UK. Prior to Lord Harrington, Ms Claire Ward was the Labour MP from 1997 to 2010, holding several roles including in the Whips Office. I should note that, having previously been content with just one parliamentary constituency, Ms Ward now has responsibility for 22 of them to keep on top of, in her role as Mayor of the East Midlands, to which she was elected in May this year.
I have mentioned Watford’s cultural diversity. Watford’s Interfaith Association brings people of many faiths and none together for an annual pilgrimage. Watford has many churches. There are too many of them to mention here, but I will visit them as part of my work as the town’s MP. I would note the famous St Mary’s church near the High Street, adjacent to the citizens advice bureau, from which the Remembrance service march to the peace memorial begins each November. The construction of St Mary’s church began in the 12th century—significantly prior to the reign of Henry VIII, a monarch famous for having fewer wives than we have had Chancellors of the Exchequer under the Conservative Government since 2010.
Just beyond the constituency boundary is St James’s church in Hertsmere, where the vigil was held, led by Father David, for the recent tragic events in Bushey, which is within my constituency. Those heartbreaking and appalling circumstances demonstrate why this Government’s determination to tackle violence against women and girls is so important. There is also the Beechen Grove Baptist church, at which many constituency Labour party meetings have fought, fought and fought again to defend the motion amendment that they love. The odd fish and chip quiz has been held there as well to raise money. Watford has three mosques, two in the town centre and one in the north. It is home to a Sikh gurdwara, which kindly hosted the parliamentary candidates as part of the general election campaign and fed us very well. Watford also has a synagogue, which also hosted a general election hustings event during the campaign.
Watford is home to several excellent theatres. The Palace theatre has an historic tradition, and it has an excellent annual pantomime—[Hon. Members: “Oh no it doesn’t!”] Oh yes it does! The Pump House theatre provides venues for smaller works, experimental theatre and festivals. The Watford Colosseum is currently undergoing a renovation project. In its new form it will not, as far as I know, offer entertainment akin to its historic namesake in Rome, although in a different guise it used to host wrestling competitions—and not even as an alternative to first past the post. The BBC symphony orchestra has office and practice space there, and I am fondly reminded of the days I spent working for the Beeb prior to working in health and social care.
Watford Deaf Club, which hosted a hustings event during the election, has shown in no uncertain terms how much work we all have to do to make the public sector properly inclusive. Watford Blind Centre, Disability Watford and Watford Workshop all do amazing work.
The fortunes of Watford football club have led many a Watfordian to experience the full panoply of emotion from joy to despair. Former prominent Watford FC footballer Luther Blissett is still associated with the town, and Elton John was chairman of the club. In fact, he played some of his farewell tours there. Truly, Watford is a magical place. It should be. If you get off the train in Watford Junction, it is quite likely that you are then going to hop on to a bus to visit the Harry Potter studios in Leavesden, in neighbouring South West Hertfordshire, but the power of Potter requires whomping through Watford.
However, Watford residents have experienced the same challenges and difficulties that people across the country have. Watford’s food bank has too many visitors. Watford’s hospital is still in need of rebuilding, decades after it was recognised that dilapidated buildings do not help deliver the best care. New Hope does amazing work transforming the lives of people suffering homelessness, and the YMCA also has an iconic presence in Watford. Small Acts of Kindness and Hand on Heart deliver goods to those in need, and One Vision undertakes valuable charitable work and supports people’s health, through engagement via faith-based organisations, who might not otherwise access those services. Impactful Governance does great work supporting the LGBT community in and around Watford, and the Watford African Caribbean Association provides help, advice and a cultural focal point to residents in the community.
The Labour Government, who have swept to power on a tide of desire for change, have core missions at their heart. This Government will make a difference to the community in which I live. They will offer it hope once more, where fear and despair currently reside. I am also confident that the Government will restore growth and wealth to the economy, liberating people from fear and timidity.
Finally, I am a part of the community that I now represent. I sprang from a maternal heritage of Welsh schoolteachers and coal miners and a paternal one of Huguenots fleeing persecution and making their home here. I want to thank the voters of Watford for sending me to this place. It is a source of wonder and amazement to me that, as a child of a hot metal printer and a dressmaker, I can be on these Benches helping to make this change happen.
Grahame Morris (Easington) (Lab)
Congratulations on your election, Madam Deputy Speaker.
I declare an interest, as I have a long association of mutual support and respect with the transport unions, particularly Unite, the RMT and ASLEF, and with all the trade unions more generally.
I welcome my right hon. Friend the Secretary of State to her new post, and I congratulate her most sincerely on prioritising the public ownership of our railways from the Government’s first day in office. This is a really important Bill, which gives me and many others on the left of the party hope and faith that this Labour Government, in which we have placed our faith, will deliver for us.
I had meant to wear my British Rail tie, because when I started work 45 years ago, or thereabouts—my goodness—I worked for British Rail in York and Scarborough. The tie is my treasured possession, but it is more elusive than a Conservative Back Bencher in a public ownership debate. I just could not find it.
I have spent quite a number of years on the Transport Committee, which scrutinised the last Government’s draft Rail Reform Bill. I welcome the Passenger Railway Services (Public Ownership) Bill, but it is clear to me that the franchising model has failed for three decades. It is now time to put passengers before private profits. By establishing Great British Railways, this Bill is the first step in taking back control.
A number of Members have raised points with which I agree, and I will mention them. I also take this opportunity to mention a local issue in my Easington constituency. The train stations in Horden and Seaham should provide easy access to Middlesbrough, Sunderland and Newcastle for employment, education and leisure. However, my constituents often experience unreliable and, at times, dangerously overcrowded services, with the chronic overcrowding meaning that passengers are often left on the platform or travelling in distressingly overcrowded carriages.
This could easily be solved by running four carriages instead of two, especially during peak periods when there is predictable demand, including on match days when my team, Sunderland, are at home at the Stadium of Light or when Newcastle United are at home at St James’ Park. Northern Rail invariably runs only two-carriage services at peak times, which seems incredible. I hope Northern Rail will address this issue.
I believe that running rail under one public entity will save taxpayers money and allow revenue to be reinvested in improving capacity and service frequency, both in my constituency and across the country. The British public have lined the pockets of private shareholders for 30 years. Over the past seven years, private train operating companies have paid, on average, £130 million to shareholders in dividends while taking public subsidies. Under the terms of the Bill, these profits will be reinvested in our railways.
We have seen how LNER, on the east coast main line, has paid more than £40 million to the Department for Transport since it has been in public ownership under the operator of last resort, but this Bill will go still further. There will be no more hefty management fees and performance bonuses to train operating companies, with more money paid back into Great British Railways.
I understand the safeguards for open-access operators, where they add value and capacity. In east Durham, Grand Central has applied to the Office of Rail and Road for four daily calls at Seaham station in my constituency, which would provide a direct connection to London, alleviating pressure on the overcrowded routes from Seaham to Sunderland. Open-access operators can benefit the network, so I hope the ORR approves these new services at the earliest opportunity.
I congratulate the Minister on building consensus with those on the frontline who run our railways, and I note the vocal support for the Bill from the RMT and ASLEF. I have long campaigned with the RMT and ASLEF for public ownership as the first step towards creating an integrated railway that prioritises passengers and our economic wellbeing over and above shareholder dividends.
The Secretary of State is on the right track—excuse the pun—and, while she is on a roll, I urge her to go a little further by reforming how we procure rolling stock, which Members on both sides of the House have mentioned. At present, the rolling stock companies lease trains to the operating companies at exorbitant prices. In fact, £409 million was paid in profits to shareholders last year, a 41.6% increase on the previous year. When Opposition Members ask where the money is coming from and how we will wring economies out of the system, there is £409 million that we could get out of the system relatively painlessly.
One of the original ROSCOs, Eversholt, is owned by CK Hutchison Holdings Ltd, a Hong Kong company set up by the billionaire Li Ka-shing, who also has shares in Northumbrian Water, which provides water and sewerage services in my region—another company that is failing the public by making millions from taxpayers. During the pandemic, the public purse subsidised train operating companies at unprecedented levels while the ROSCOs’ profits continued to soar. Yet with all operators set to be under public ownership by 2027, surely now is the time to reconsider how we procure trains for Great British Railways. Labour has a mandate for change. We can end the abuse of the British taxpayer inflating profits for privatised monopoly industries that should be publicly owned, including water, rail and energy. At least for rail we have begun the process of change.
To meet decarbonisation goals, the UK needs to upgrade up to 4,000 rolling stock units, which will cost tens of billions of pounds, so we will need a new financing model to meet those demands. With adequate planning, that could also mean ample orders to sustain our British-based train manufacturing industry and avoid the gaps in the order books we have recently seen at Alstom and Hitachi. I praise the Secretary of State and her ministerial team for the effort and energy they have expended in trying to seek a solution.
With Great British Railways, I urge the Secretary of State to ensure that ROSCOs do not continue to exploit the taxpayer and that we take back control of our rolling stock. The Great British public deserve better value for money. Public control of our train operating companies is the first step in delivering a better service. I look forward to working with my right hon. Friend the Secretary of State as we set out the finer details for Great British Railways. This is a transformative Bill for our railways—one of the most transformative Bills I have seen in my lifetime—and my right hon. Friend has my full support in delivering the modern and efficient rail service our country needs and deserves.
Madam Deputy Speaker (Ms Ghani)
I call Adam Jogee to make his maiden speech.
Adam Jogee (Newcastle-under-Lyme) (Lab)
It is a pleasure to follow my hon. Friend the Member for Easington (Grahame Morris). May I say what a pleasure it is to see you in the Chair, Madam Deputy Speaker? You have made history with your election and you will have inspired many women and girls across our country.
It is wonderful to see a number of my neighbours here, including my hon. Friends the Members for Crewe and Nantwich (Connor Naismith), for Stafford (Leigh Ingham), for Stoke-on-Trent North (David Williams) and for Stoke-on-Trent South (Dr Gardner), as well as many hon. Friends from across the west midlands. I say a special thank you to my former boss, my hon. Friend the Member for Newport West and Islwyn (Ruth Jones), who is sitting with me here on the Government Benches, a far cry from when I sat opposite her in her office upstairs.
I pay tribute to my hon. Friends the Members for High Peak (Jon Pearce), for Hertford and Stortford (Josh Dean), for Smethwick (Gurinder Josan), for Stevenage (Kevin Bonavia) and for South Ribble (Mr Foster), all of whom gave important, interesting and witty speeches, as well as to the hon. Members for Thornbury and Yate (Claire Young) and for Taunton and Wellington (Mr Amos).
It is a real honour to make my first speech in this House as the Member of Parliament for Newcastle-under-Lyme, and in such an important debate too. I pay tribute to the Secretary of State both for the Bill and for her leadership on these issues. She and I share an interest in Northern Ireland. I am very grateful for all the work she has done to get us to where we are today.
I start by acknowledging the deep responsibility I feel to the people who sent me here. I thank them for placing their trust in me and I will work every day to honour it.
My journey to this place started in the former British Empire. My maternal grandfather arrived in the United Kingdom from Jamaica, to serve King and country and to help fight fascism. He docked in Liverpool in 1941 and, after meeting my grandmother, built a life in Staffordshire, the county I am proud to represent today.
My Dad, who is here in the Gallery, moved here from the then Rhodesia, now Zimbabwe, in 1979 and had the luck to meet, and the wisdom to marry, my Mum, a good Staffordshire woman, born and bred. She is also here in the Gallery. I would not be here without either of them.
I stand on the shoulders of my grandparents, Mr and Mrs Bob Owen and Mr and Mrs Adam Jogee. Their blood runs in my veins. Their life stories forged my identity and my outlook on the world. The greatest gift my parents and grandparents have given me is their example of what courage, tolerance, love and diversity mean, not as academic concepts but a lived experience.
That I am standing here today, a Member of the House of Commons on the Government Benches, was not inevitable, but it was possible. My election—the first black man to represent anywhere in the west midlands—says so much about who we are in 2024 and what our nation means. While it is with a sense of sadness that I acknowledge that none of my grandparents is here to witness this speech, I am confident that, if they were, they would all be saying to each other what a wonderful country this is.
I am proud of my Englishness and my Britishness, and of the simple truth that, in our United Kingdom, you can be anything you want to be with the right support, a work ethic, real opportunities and a good heart. I am not defined by my colour, but I am very, very proud of it, and Labour Governments are key to building the kind of enabling environment that means that success and a good life are available to all. It is that passion for sharing opportunity that drives me every day.
For those who did not make it to campaign with me in the general election—I note that my hon. Friend the Member for Hornsey and Friern Barnet (Catherine West), who I know very well, did make several visits, for which I am grateful—Newcastle is an ancient market town in the middle of England. Its rich history dates back to medieval times, with its market charter granted in 1173, which means that last year we celebrated the borough’s 850th anniversary.
The people who live, learn and work in Newcastle-under-Lyme are decent, caring, proud and honest. Indeed, when I think of their honesty, I am reminded of two particular chats that I had during the campaign. This is semi-dangerous, I suppose, when we start quoting our constituents. I met Steve and his son in Betley—in fact, in the very good Swan pub in Betley. I recommend it to anyone passing through, particularly my hon. Friend the Member for Crewe and Nantwich (Connor Naismith), who is very welcome. The first thing Steve said to me was, “You’re much shorter than I thought you would be in real life.” It was the final chat after a long day of door knocking, and my first reaction was, “Thank you very much, I think.”
I then met Christine, a pensioner from Wolstanton. She said, “You are much younger and better looking than you look in your leaflets. You need new leaflets.” I will not share the story about horse riding with my friend Carol Whitehouse in Audley, but suffice it to say, we will all do anything safe and legal to get elected. I was reminded in these conversations of the age-old adage that the voters are never wrong. That is a lesson that Conservative party Members—not that there are many here tonight—may want to heed.
In my patch, you know where you stand, and if you build trust, show that you care and listen, local people will have your back. We are blessed with very fine centres of learning: we are home to Newcastle College and the wonderful Keele University, one of the best higher education institutions in our country. My hon. Friends the Members for Stoke-on-Trent Central (Gareth Snell), for Stoke-on-Trent North (David Williams) and for Stoke-on-Trent South (Dr Gardner) seek to take credit for it and claim it every day, but it is ours. We have many brilliant schools with wonderful teachers, teaching assistants and special educational needs co-ordinators. I have been honoured to visit many of our schools over the past 18 months. I will stand up every day to rebuild the support for children and their families with special educational needs, because the current situation in Staffordshire, and in Newcastle-under-Lyme in particular, is unacceptable.
My constituency boasts beautiful parks and green spaces, such as Queen’s Gardens and the Victorian Brampton Park, known for its museum, aviary and landscaped gardens. I am looking forward to you visiting us, Madam Deputy Speaker. We have Lyme Valley, the old Keele golf course, and much rural, productive green belt in the northern part of my constituency, centred around Audley and Madely.
While I completely and unequivocally support our Government’s plans to build more homes, we must, at the same time, do as much as we can to protect our green spaces and deliver the infrastructure that goes with any new homes. It must be a case of doing things with, not to, people.
While some might look north of the Watford Gap and see a cultural desert, I see vibrancy. I am especially proud of the New Vic Theatre, known for its innovative productions and meaningful community engagement.
We cannot talk about North Staffordshire without mentioning the old mines and pits in Chesterton, Silverdale and Crackley, nor can we avoid talking pottery and ceramics, because our region is home to the age-old pottery industry. I am looking forward to working across the A500 and the A34 with my hon. Friends the Members for Stoke-on-Trent Central, for Stoke-on-Trent South and for Stoke-on-Trent North.
My constituency boasts of being home to a Prime Minister: the sixth Prime Minister of Australia, Mr Joseph Cook—long dead, but he was born there. He was born and raised in the old mining village of Silverdale. I am proud of the fact that a Prime Minister was born in our patch. The only issue I have with Cook is that he started off in the Labour party and ended up a Tory, but nobody—or almost nobody—is beyond redemption. On that basis, Madam Deputy Speaker, you will forgive me for emphasising his passion for aiming high when I talk to the young people of Newcastle about him, rather than his moving around political parties.
Newcastle-under-Lyme could not be better placed. We are bordered by the west coast main line and the M6, between Birmingham and Manchester, not far from Derby and Nottingham and only 90 minutes or so from our capital—when Avanti chooses to work properly. Robust rail infrastructure is a strategic necessity for Newcastle-under-Lyme, for our region and for our United Kingdom. It will stimulate economic growth, bring people together and tear down barriers, and we can do that while at the same time protecting our environment and preserving our planet.
Addressing the north-south divide in transportation infrastructure is about not just fairness, but maximising the full potential of the north to contribute to a more balanced, prosperous and sustainable future for all of us. That is why I welcome the Bill before us. It shows my constituents that we meant it when we said that we would focus on getting our nation back on track. I see the Minister for buses, my hon. Friend the Member for Wakefield and Rothwell (Simon Lightwood), on the Front Bench; I look forward to speaking to him about buses soon too.
Newcastle-under-Lyme was rich in coal, leading to extensive mining activities for not far off 200 years. The coal industry played a crucial part in the town’s development and economy. The development of the Trent and Mersey canal in the 18th century enhanced transportation links, facilitating the movement of coal and pottery. The canal system was vital for industrial distribution before the advent of our railways.
The wonderful Apedale museum and heritage centre provides future generations with a window back to the proud history of our town. I first went when I was about 12, and it is still going strong. The Apedale Valley railway operates at the same site, adding to a great family day out. Sadly, though, like most of the west midlands and the north, while we are proud of our past, we have not seen sufficient focus on building our future by diversifying our industries and jobs. As the historical and traditional industries declined, my constituency transitioned to a service-oriented economy based on education, healthcare and retail.
Rather than Tory soundbites and gimmicks, this new Labour Government have a plan to deliver real change, driven by a mission of national renewal. That is clear from this Bill and from the new deal for working people. Let us be clear: under the Tories, working people suffered more than a decade of falling and flatlining pay, while prices in the shops went up and energy bills soared. People across Newcastle-under-Lyme still feel the worst effects of the cost of living crisis today. The Tories broke our country and we are all still paying the price.
Labour’s new deal for working people is a plan to make work pay, ensure security at work and help to provide the work-life balance that everyone deserves. This Bill and an improved rail service will bring connectivity and growth and, setting it alongside the new worker’s deal to ensure that working people can prosper, we will see the power of a Labour Government.
Cleaning our air and tackling waste crime is a priority for the people who sent me to Parliament. Walleys Quarry landfill is a disgraceful example of the worst excesses of profit over people and we will not stand for it any more. It is an environmental crisis and a health one too. That is why I am grateful that that my right hon. Friend the Environment Secretary today answered my calls and those of all members of Newcastle-under-Lyme borough council, and granted the council permission to proceed with legal action against Walleys Quarry Ltd. That is more done in three weeks than the last three Environment Secretaries did in three years. It requires the law to be changed, but I know that the Environment Secretary has heard me loud and clear.
I am fortunate—I am keeping an eye on the clock, Madam Deputy Speaker—to have met and to know my three immediate predecessors dating back to 1986, Aaron Bell, Paul Farrelly and the noble Baroness Golding. I am grateful to the more for their service to the people of Newcastle-under-Lyme and I wish them and their families very well. I have been lucky to have had wonderful support and advice from some brilliant people since my election and over the years. I want to make a special mention of former Prime Minister Julia Gillard, former Tánaiste Joan Burton and a former Member of this House, Lady Hermon, who made my wedding cake—our wedding cake, I should say; Alison was probably safer at cutting it.
For me, this is personal. Newcastle-under-Lyme is where my wife Alison and I will raise any family that we are blessed with. I want to say how grateful I am to my wife Alison, who has been on this journey with me over the last seven years, on foot, by plane, by bus, in the car and on our railways. I love and admire her and her work as a nurse in our national health service—work that will be strengthened by this Labour Government. I also want to acknowledge the support of my in-laws, who are watching these proceedings from Northern Ireland.
The last really important speech I gave was on my wedding day. Memories of that speech are the reason Alison and my family are very pleased indeed that I have an unofficial time limit—although I am pushing it. My speech as a new husband lasted 28 minutes—[Interruption.] Very short. It was timed by my closest mates and friends and they have not, to this day, let me forget it; it took that long due to the appearance of some very happy tears.
Today is a marginally shorter speech, and there are no tears, but there is emotion and determination. There is love—love of family and love of country—and a resolute determination to do my utmost to ensure, in Newcastle-under-Lyme and across our United Kingdom, that all families know that in the years ahead, their children will be able to build lives of opportunity, community, security, success and hope.
Madam Deputy Speaker (Ms Ghani)
No doubt your maiden speech will have made your parents very proud. I now call, for another maiden speech, Connor Naismith.
Connor Naismith (Crewe and Nantwich) (Lab)
Thank you for the opportunity to make my maiden speech, Madam Deputy Speaker, and may I congratulate you on your election? I am particularly proud to be able to make my maiden speech in a debate on rail, as the Member of Parliament for a constituency with railways literally woven into its DNA.
The town of Crewe grew up around the railway station, and the development of Crewe and the rail network went hand in hand in the 19th century. My constituents will be delighted to have a Government committed to delivering a publicly owned and passenger-focused railway, the need for which hit home to me only too well when the former shadow Rail Minister was severely delayed on the rail network when visiting my constituency late last year.
I cannot begin to talk about the history of elected representation in Crewe and Nantwich without making reference to the towering figure that is the late Gwyneth Dunwoody. Still today, I meet people whose lives have been touched by Gwyneth’s unmistakable ability to fight for her constituents’ interests. She was truly fierce—an excellent parliamentarian and public servant.
I would also like to pay tribute to my immediate predecessor, Kieran Mullan, who has gone to great lengths to demonstrate his commitment to our democracy—approximately 250 miles, in fact, from Crewe to Bexhill! The now hon. Member for Bexhill and Battle did a great deal to champion the cause of the many volunteer groups across my constituency in his time as its MP. I thank him for that and congratulate him on taking up his place on the shadow Transport team.
I love the place that I have been sent here to represent, from the major towns of Crewe and Nantwich to the beautiful villages and parishes like Shavington, Haslington, Wistaston, Willaston and Rope, among others. Crewe is a fantastic town, where I am proud to live with my family. It is the gateway to the north and a key rail interchange with a proud history of train manufacturing in Crewe Works, which once employed over 20,000 people. I believe strongly that rail can be pivotal to Crewe’s future, as well as its past, and I intend to be a strong advocate for improved transport infrastructure connecting the north and the midlands, with Crewe at its heart.
It is not just trains that run through my constituency; so does a belief in the importance of employment rights and trade unionism. At the tail end of the 19th century, the suffragist and pioneering campaigner for the rights of women workers, Ada Nield Chew, wrote a series of letters to the Crewe Chronicle under the pseudonym “A Crewe Factory Girl”, shining a light on poor working conditions in the factory she worked in. Many of the issues that she raised in those letters, such as insecure work, unpredictable hours, the gender pay gap, and the denial of a living wage—a phrase that she actually used all that time ago—remain all too relevant today, which is why I firmly welcome this Government’s commitment to bringing forward an employment rights Bill. I am also proud to support the campaign of Kate Blakemore in my constituency to commission a statue for Ada in Crewe.
My constituency is also home to some of Britain’s finest sporting exports, notably through the academy of the mighty Crewe Alexandra—a famous academy that has produced some cult heroes from our national game, from David Platt to Danny Murphy and Dean Ashton. The Alex have consistently punched above their weight, and the importance of the Railwaymen—as the club is also affectionately known—was driven home to me during the election campaign, as a result of an unexpected boost to my prospects when the now Leader of the Opposition was pictured wearing a scarf of our rivals, Port Vale, on a visit to Stoke.
Nantwich is a beautiful, historic market town that sees large numbers of tourists pass through every year. Historically, it was a centre for the production of salt and the manufacture of leather goods, from which the affectionate nickname for the town’s residents, “the Dabbers”, is believed to derive. Today, Nantwich is famous for a host of civic and cultural events throughout the year, including the international cheese show, the Nantwich food festival, a jazz festival and a words and music festival, among many others. These events show the best of the community in Nantwich, often driven by volunteers and supported actively by Nantwich town council. They demonstrate what can be achieved in a modern landscape for small towns while still actively respecting our heritage.
Across Crewe and Nantwich, we have a thriving business community that is home to some of Britain’s most famous exports, from the luxury vehicles produced at Bentley Motors to the ice cream vans at Whitby Morrison, and I am immensely proud to represent a constituency that is already a pioneer of Labour’s fantastic policy to buy, make and sell British. We have beautiful green spaces and environmental gems, too, including green-flag parks such as Queens Park; that park is lovingly supported and maintained by the Friends of Queens Park group, which is led ably by Sheila, Richard and Alan, among others. We also have the River Weaver, which flows through Nantwich, and I know that my constituents—like the local women’s institute group who I joined on a demonstration recently—will rightly expect me to champion the cause of cleaning up our rivers in this Parliament. I welcome the steps that this Government have already taken to do just that.
As my colleagues will attest, it has been a long campaign during which many of us have been asked so many questions. I do not know whether to be flattered or offended that the question I was most often asked during the campaign was, “Have you finished school yet?”
Connor Naismith
Just about. But far and away the most common question was, “Why should we trust any of you?” That experience was reflected in many of my colleagues’ experiences during the campaign. In that question lies possibly the most fundamental challenge facing this Government, because after 14 years of managed decline, people no longer believe that politics can deliver anything but decline. They believe that politicians are only in it for themselves—that their attention and focus are distant from the priorities of the ordinary families they seek to represent.
I came to this place from a career with the Independent Office for Police Conduct, whose role is to independently uphold standards and ensure that the public can have confidence in the police. No doubt there is much work to do in that space, but I believe strongly that I and my colleagues from across all parties in this House have a duty to uphold standards and restore public confidence in our politics, and aspiration and opportunity to our communities.
It is sometimes claimed by the Conservative party that my party has a problem with aspiration, but I know that not to be true. My party understands that if someone is living in fear of being evicted from their home, that is a barrier to aspiration; if someone’s parents are living in in-work poverty, that is a barrier to aspiration; and if someone is unable to receive the treatment that they need if they become ill, that is a barrier to aspiration. When the Labour party is given the chance to serve the British people, it has a fine record of smashing the barriers to aspiration. It did it for a working-class kid like me, and it will do so again—I am confident of that.
For that reason, I wholeheartedly welcome the Prime Minister’s belief that politics is about service, and his commitment to lead a Government who focus relentlessly on delivering for people by putting country first, party second. I promise to always do my best to serve and represent my constituents in that spirit for as long as they trust me to do so.
Anna Dixon (Shipley) (Lab)
I congratulate you, Madam Deputy Speaker, on your election and I welcome you to your place. I commend my many hon. Friends who have made such tremendous contributions in the House this evening, particularly my hon. Friend the Member for Newcastle-under-Lyme (Adam Jogee), who gave a moving tribute to his parents, and my young hon. Friend the Member for Crewe and Nantwich (Connor Naismith), who has a few less grey hairs than me.
I also congratulate my right hon. Friend the Transport Secretary; it is wonderful to see her in her place on the Government Benches. I thank her and her team for bringing the Bill to the House so quickly.
I am honoured to have been elected by the people of Shipley constituency to represent them. I grew up on the edge of the moors in beautiful Wharfedale, and I am proud to serve the place I now call home. I am by no means the youngest Member to have represented the seat—that honour goes to Chris Leslie who, at 24, was the baby of the House when he was elected in 1997—but I am the first woman. I am delighted to be part of the most diverse Parliament with some 263 women MPs on both sides of the House.
On my first day, as I emerged from Westminster tube and looked up in awe at the Palace of Westminster, I took a diversion across Parliament Square to pay homage to Millicent Fawcett, the social campaigner and suffragist whose statue stands alongside Churchill and Gandhi. She holds a banner with the motto, “Courage calls to courage everywhere”. I have carried those words with me during my first few weeks in Parliament, although I feel more like the lion from “The Wizard of Oz” as I stand here to make my maiden speech—please, give me courage.
I know the people of Shipley have put their trust in me, however, which gives me heart. All around me, I see people of courage—every one of us on these Benches. First, we had the courage to stand in the hostile climate in which politics has been conducted recently. It is vital that our democracy is not undermined by those who wish to abuse, threaten and intimidate. I am grateful to the Labour Women’s Network for giving me the support and encouragement to stand, as well as to my husband David, who is here today. I am proud to support 50:50 Parliament’s campaign, Ask Her To Stand, and I thank the Jo Cox Foundation for its work to promote civility in politics. I will play my part in upholding standards in this place.
Secondly, we have the courage to stand up for what we believe in. Each one of us has come to this place with a passion to change things for the better and to leave our communities and the country a better place than when we arrived. I am heartened by the commitment to work across this House and put aside tribal politics where they get in the way of progress and bring the common good to the fore. I look forward to working with my neighbour, the right hon. Member—no, not quite—the hon. Member for Keighley and Ilkley (Robbie Moore) [Interruption.] Not yet. I will seek to work with colleagues who share my passion to ensure all disabled and older people get access to the care and support they need to live a full life, work I started as the chair of the archbishops’ commission on reimagining care and which I hope to see delivered in the form of a national care service under this Labour Government.
Finally, we must also have the courage to speak up for those whose voices are rarely heard in the corridors of power, to tell their stories, to demand changes that will improve their lives and to show how things can be better. Many years ago, my teacher Mr Hodgson told me, “You can spend your life shouting from the outside or go and change things from the inside.” I intend to use my voice in this place to speak up for the people of Shipley constituency, particularly those whose voice is too often ignored or drowned out.
So I am proud that we have a Government who are courageous and have wasted no time in pressing forward with ambitious legislation to deliver on their promises, and today my right hon. Friend the Secretary of State for Transport has set out another bold plan, taking the first steps to establish Great British Railways. The people of Shipley constituency have suffered from expensive and unreliable public transport for too long. Today’s Bill will begin the work of putting the “public” back into public transport, delivering better connectivity so that children from Baildon and Burley-in-Wharfedale can get to school, commuters from Cottingley, Crossflatts and Cullingworth can get to work, and pensioners from Eldwick and Gilstead can get to the shops—boosting the economy, enabling tourists to visit our wonderful heritage and beautiful countryside in Bingley and Shipley, and making it easier for people to enjoy a night out in Bradford, proudly the city of culture in 2025.
According to protocol, I am to say something about my immediate predecessor, Sir Philip Davies, who served the people of Shipley constituency for 19 years. He was always diligent about his correspondence, replying quickly to constituents. Sir Philip advocated for investment in the local area, and it is in part thanks to his efforts that the NHS has recently committed to reinvesting funds from the sale of Shipley hospital into a new health and wellbeing hub. I look forward to continuing his work to bring a hoped-for boost to Shipley town centre. I can, however, reassure the House that I do not intend to continue his tradition of filibustering on a Friday.
I also wish to pay tribute to other Members who have sat on these Benches and inspired me. There was the formidable Yorkshirewoman Betty Boothroyd, the first woman Speaker of the House. Her courage gave a teenage lass from Ilkley the idea that she might one day follow in her footsteps, so I hope I can in time make my own contribution to the work of this House.
Jo Cox was a contemporary of mine at Cambridge, and it was her life and horrific murder that spurred me on to stand. On reading her biography in 2017, I wrote in my own diary:
“The values she sought to reflect in the MP she was are also ones I aspire to: to be brave, principled, focused, respected, grounded.”
These values will be the yardstick against which I will judge my own time in this place.
It is usual to say something about the constituency I represent, and there is much to celebrate in the Shipley constituency from Wilsden to Windhill, Micklethwaite to Menston. We are home to the highest flight of locks on the canals in Britain and the original setting for TV soap “Emmerdale”.
However, I am going to focus on one place, Saltaire, a model village built by Sir Titus Salt, a philanthropist and mill owner. The mill was at the forefront of innovation in the wool trade and the largest in Europe. Salt provided decent housing and amenities for the workers, a library, a school—now home to Shipley college—and a church. He was wary of the demon drink, though, so no pub, although I am pleased to say that Saltaire now boasts an excellent brewery. Salt understood that economic growth and lifting people out of poverty go hand in hand, and I am proud that the Labour Government will ensure there are high-quality jobs for local people, end the trap of low-paid work and open up opportunities for people to train for the jobs of the future.
I could tell hon. Members about other inspiring historical figures who hail from or have lived in my constituency and are immortalised in the names of local buildings and roads, or I could tell them about the many amazing volunteers who keep our communities blooming, the independent business owners whose industry powers our local economy and the local farmers whose toil puts food on our plates, but I would like to tell them about those in my own life whose courage has given me courage.
My great-grandfather Frederick Dixon fought and died on Flanders fields in the first world war. My grandfather Herbert, true to his Christian beliefs, refused to serve in the military during the second world war and undertook other vital work. He died in a car accident that left my grandmother Freda in a coma with brain injuries. She learned to walk again, to feed herself and to write with her left hand. She lived for another 30 years, albeit with disability and mainly housebound, but she could still beat all of us at Scrabble.
My late uncle David came to this country from Zambia on a scholarship and became the first black African to play golf for Oxford University—a golf legend 40 years before Tiger Woods hit the headlines. My niece Martha, diagnosed as autistic after struggling with mental health issues as a teenager, has had the courage to embrace her difference and find her way in the world.
My family—in particular my mum and dad, who are in the Gallery—and my church taught me the values that I bring to my politics: that everyone should be able to live free from prejudice and discrimination, and that those of us who have plenty must share what we have and take action to lift people out of poverty and tackle inequalities. I am proud to be a member of the Labour party, which is putting those values into practice.
There will be time in the coming months for me to talk about the priorities that I will deliver for the people of Shipley—getting local GP and NHS dental services back for patients in places like Wrose, stopping sewage dumping in the Wharfe and the Aire, having more neighbourhood police in villages such as Denholme and Harden, revitalising our high streets in Shipley and Bingley and supporting young people’s mental health—but the final issue that I would like to highlight today is the contribution of family carers.
My mum cared for my grandma for many years, and it was her love and support that enabled my grandma to go to church, take trips up the dales, see friends and family and have a good life. There are millions of unsung heroes like her, unpaid and undervalued. Behind closed doors across this country, an estimated 5 million people—mostly women—are providing support and care to loved ones. I want to make them my priority in this place, and I will start by campaigning for a review of the carer’s allowance to ensure that hard-pressed carers are not penalised for taking a part-time job to make ends meet.
I would like to end where I began: with the words of Millicent Fawcett ringing in my ears. Courage calls to courage everywhere. I will stand up for what I believe in and speak up for the people of Shipley constituency, and perhaps my courage will inspire another young Yorkshire lass to follow me into this place one day. As Betty would have said, time’s up.
Madam Deputy Speaker (Ms Ghani)
Jo Cox and David Amess are never far from our thoughts.
Front Benchers will be called to speak at about 9.30 pm, and we have three Back Benchers left to speak, so please be mindful of time. I call Catherine Atkinson.
Catherine Atkinson (Derby North) (Lab)
This is a historic and significant Bill for the country, for the rail industry and for my constituency. The date of 25 April 2024 is one that I will not forget: it was when the Labour party published “Getting Britain Moving: Labour’s Plan to Fix Britain’s Railways”. The day after that, my right hon. Friend the Prime Minister wrote a piece in the Derby Telegraph pledging that after
“200 years…at the heart of our railway industry…Derby will be at the heart of our rail renaissance”
with a bigger and stronger version of Great British Railways, headquartered in Derby. That came at what was an extremely difficult time for Derby, with train manufacturing in the city on the ropes. The commitment that publicly owned rail would deliver for passengers, taxpayers and rail manufacturers was huge, because it meant that when rail in Derby came together and spoke with one voice, it was listened to.
This legislation is in no way anti-private business. What is anti-private business is privatisation projects doomed to failure. Dynamic private businesses are as important to rail now as they have ever been, with everything from maintenance and testing to digital, data, and finance all part of the east midlands railway cluster, which is the largest in Europe. They will be looking for answers on how, as private businesses, they will work with the public operator. Any more that the Secretary of State can say on that would be welcomed.
Those businesses will be partners in modernising the railways. Can we set out in this Bill or the rail reform Bill the need for long-term funding for modernisation? I appreciate that, as the Chancellor set out earlier, this Government are inheriting the worst set of economic circumstances since the post-war Labour Government who last brought the railways into public ownership. One area of savings that will come from this Bill will be on management fees and dividends, which would be better used on new technologies to make our railways greener and safer. The last steam locomotive was still being repaired in Derby in 1963. That was after a man had gone into space and 15 years after the railways were brought into public ownership.
I do not want to be looking back, 15 years from now, saying that we did not invest enough in developing new locomotive technologies, losing out on the advantages. Instead, let us take inspiration from when Derby’s prototype high-speed train set a diesel-powered world record of 143 mph in 1973. This Bill is the embodiment of “move fast and fix things”. Once it is in place, we can start bringing services back into public ownership as they expire. I understand that the poor performance of the services could mean that happens faster. Can the Minister tell the House any more about that?
I thank the Secretary of State for Transport for her support for the rail industry in Derby. She makes a great champion for the new publicly owned railway and can draw inspiration from Nye Bevan’s role when the NHS was brought into being, fighting off vested interests for the public interest. The public want to get off busy roads and they want to help the environment.
What the Government are doing, with a strong champion like the Secretary of State, can be the spark that reignites our passion for rail travel. That will be essential to its renaissance. Improvements that passengers can see and feel are crucial and should be rolled out in tandem with the franchises being brought back into public ownership. Improvements set out in the “Getting Britain moving” document include automatic delay and cancellation refunds, a best price guarantee and better mobile connectivity. The timing of that rail Bill in relation to this one will be important. Can the Secretary of State update the House on when the next Bill will be laid? I want to get this important rail Bill moving, get passengers and goods moving and get our economy moving, so that we can move fast on our journey to a better and greener transport system.
Paula Barker (Liverpool Wavertree) (Lab)
I congratulate you on your elevation, Madam Deputy Speaker. I congratulate all hon. Members from all parts of the House who have made maiden speeches today. I refer the House to my declaration in the Register of Members’ Financial Interests as a proud trade union member.
I begin by paying tribute to my right hon. Friend the Secretary of State for getting us to this point. She has moved swiftly, with tenacity and vigour, in doing what is right for the country and the travelling public. I know that the Secretary of State will see this task through to the very end. I also pay tribute to the train drivers from ASLEF union who were outside today showing their support for this Bill and our rail workers in the RMT and Transport Salaried Staffs Association unions.
Railway privatisation has failed. Franchising has failed. The railways have become symbolic of rip-off Britain where the public pay more and get less, the gains are privatised and the losses are picked up by the taxpayer. Members of the Opposition will accuse us of being ideological with the Bill. It was their Government in 1994 who embarked on a ruthless privatisation of yet another natural monopoly, laying the foundations for a system where public subsidy in effect gets paid out to shareholders as dividends. Perhaps it is only the Opposition Members—and, of course, Michael Portillo—who still hold on to the belief that franchising has worked. How embarrassing is it that the Conservative party’s legacy has already given my right hon. Friend a helping hand, with one in four passenger services already being run by the state owing to their failures in office?
Saving talk on infrastructure for another day, the sheer lack of capacity on the west coast main line and between our great northern cities has led my part of the world to be consistently failed. My constituents in Liverpool Wavertree and the wider city of Liverpool have come to have low expectations in respect of the service on offer from our railway operators when they decide not to plonk their car on the M62 or the M6. TransPennine Express—the main carrier between Liverpool, Manchester, Leeds, Hull and Newcastle—was nothing short of a disgrace as a private entity, with as many as one in six of its services cancelled in March 2023, two months before the Government intervened. Moving on, north-west, north Wales, west midlands and many Scottish MPs will have experienced the utter chaos of Avanti West Coast. I wonder if that is why the shadow Under-Secretary of State has hotfooted it from Crewe and Nantwich to his current seat in Bexhill and Battle.
Avanti is an absolute professional in failing the public and its dedicated staff. I understand from the Secretary of State’s letter to hon. Members that she has not yet decided on the timing of each transfer, but I would be surprised if Avanti was able to make it until October 2026 when its core term expires. I know that she will be keeping a close eye on that failed operator in the coming period. Avanti still had the temerity to pay out over £11 million in dividends last year alone, having had the second-worst record for cancellations across the entire UK in the last quarter. Enough is enough.
I am excited by this piece of legislation, because I know that it will make a genuine difference. Once and for all, it will be this Labour Government who end the great train robbery.
Madam Deputy Speaker (Ms Ghani)
Saving the best till last, I call Chris Webb.
Chris Webb (Blackpool South) (Lab)
Thank you, Madam Deputy Speaker. I welcome you to your place. I refer to my entry in the Register of Members’ Financial Interests as a proud trade unionist. I welcome the Bill to bring our railways back into public ownership. Swift action from this Labour Government to reform our railway service is a significant step forward that will benefit my constituency for generations to come.
The arrival of the railway in Blackpool in 1846 was the beginning of mass tourism that gave my home town its identity. In 1911, the town’s central station was the busiest in the world. By 1936, 650 trains came and went in a single day. Today, the picture is quite different. Blackpool is currently served by Avanti West Coast, which in September 2023 was handed a long-term contract for up to nine years by the former Conservative Government despite overseeing a poor record of service in recent years with ongoing delays and cancellations. Office of Rail and Road figures show that Avanti West Coast had the third-worst reliability of all operators in Britain last year with one in 15 trains cancelled. When trains do come, they are routinely delayed and overcrowded. While delivering some of the worst disruptions to passenger travel, shareholders have extracted £36 million in dividends in the last three years. Those are the conditions that passengers in my constituency have been forced to accept and come to expect.
As a frequent, and frequently frustrated, user of the west coast main line, I do not need figures to know that passengers as well as staff are fed up. Last week, Avanti’s catering staff went on strike over short-notice changes to their shift patterns, job cuts and enforced overtime, which are causing widespread stress and fatigue. This is the latest in a string of industrial action disputes that have dogged Avanti, which imposes excruciating conditions on its long-suffering staff. The last Government sat back and watched as the privatisation model failed, and staff and customers suffered the consequences.
Blackpool’s tourism has recovered in recent years and we now welcome record numbers, with visitors topping the 20 million mark. Those visitors contributed £1.7 billion to our local economy and supported more than 22,000 jobs. There is no doubt that a more efficient railway service would allow those figures to grow more. Reducing visitors’ dependency on cars would not only lower emissions but encourage more overnight stays to Blackpool, where we struggle to provide significant parking. Our new tramway between Blackpool North station and the promenade’s tram network means that people arriving in the town are instantly connected to hotel accommodation right up and down our seafront.
A reliable and affordable service will also allow my constituents to access better opportunities. Too often, Blackpool loses its brightest and most talented young people to neighbouring cities, when that should be an easy commute. By improving connectivity and ending constant cancellations, we can end Blackpool’s brain drain and allow people to live an affordable life by the seaside while accessing well-paid work out of town. This landmark change to our railways means that Blackpool can increase visitor numbers and boost its economy and job market. By unlocking the potential of our railways, we can also unlock the potential of our young people in Blackpool. By giving my constituents and visitors the town and the rail service that can they depend on and deserve, we can ensure that Blackpool will no longer feel abandoned at the end of the line.
Madam Deputy Speaker (Ms Ghani)
I call my constituency neighbour, the shadow Minister.
Dr Kieran Mullan (Bexhill and Battle) (Con)
Thank you, Madam Deputy Speaker, and congratulations on your new role. I want to begin by paying tribute to the previous Rail Minister, my constituency predecessor Huw Merriman. I saw at first hand how hard he worked with Members across the House to deal with their transport issues, and I have since come to learn how hard he also worked as a constituency MP.
It is a pleasure to wind up this debate for the Opposition and to have sat and listened to another set of accomplished maiden speeches across the House. We heard speeches from the hon. Members for Hertford and Stortford (Josh Dean), for South Ribble (Mr Foster), for Taunton and Wellington (Mr Amos), for Stevenage (Kevin Bonavia), for High Peak (Jon Pearce), for Thornbury and Yate (Claire Young), for Smethwick (Gurinder Josan), for Birmingham Northfield (Laurence Turner), for Melksham and Devizes (Brian Mathew), for Watford (Matt Turmaine), for Newcastle-under-Lyme (Adam Jogee), for Crewe and Nantwich (Connor Naismith), for Shipley (Anna Dixon) and for Blackpool South (Chris Webb).
There were excellent speakers all round, but I will leave it to the Minister to pay detailed tribute to Members of his party. A consistent theme was the importance of family, which I strongly agree with. It was slightly surreal to hear my successor in Crewe and Nantwich pay tribute to me, and I thank him for his kind words. Sadly, I am not sure what I got wrong because no one there ever asked me if I had finished school before I asked for their vote. To continue with the rail puns, I am sure that he will be a worthy successor to me in Crewe and Nantwich, rather than just a replacement service.
On the Opposition Benches it was helpful to hear from the former Rail Minister, my right hon. Friend the Member for Aldridge-Brownhills (Wendy Morton). She has first-hand experience of the recent changes to our railways, and she explained clearly how this ideological approach is ignoring the reality on the ground, where the franchises should be the focus of the Minister’s attention. She asked where this is leading, and I noted that the Secretary of State referred to the work that the Government will do on the supply chain. Other Members have related their concerns about rolling stock. This is the beginning of the end when it comes to a flourishing rail sector with all sorts of people playing their part. It is clear that we all want to secure better services for passengers alongside value for money for taxpayers. Whatever our differences, we agree on that. The question is how we do it.
The catastrophic impact of the covid-19 pandemic has forced a rethink—a necessary and important one. During the pandemic, the previous Government demonstrated clearly their commitment to the railways and to railway staff, providing large amounts of public money to keep the railways running and keep railway staff in their jobs. But that period also hastened the decline of the traditional franchise model as we know it. Passenger journeys plummeted and while there has been a significant recovery travel patterns have changed. That is why we conducted a major review of our railway services and how they operate, and suggested a change of approach as outlined by the shadow Secretary of State during her opening speech.
That change of approach, as we heard today, is one the new Government are taking forward in many areas, but what we also heard today is that they are bringing with them not a passenger-first policy, but an ideology-first policy. Their priority is to ban the private sector from operating our main train services. Of all the things they say need doing, and with 14 years of opposition to come up with a list of what needs doing first, they have nationalisation, even though, as the Secretary of State said, it will not make train tickets cheaper or end the strikes. In fact, it is worth reading out the complete non-commitment on rail fares that Labour makes in its plan. It says it wants prices
“kept, wherever possible, at a point that works for both passengers and taxpayers”.
I can imagine the civil service pen of Sue Gray hovering over that particular sentence. It really is an exemplar of Labour’s modus operandi: using a lot of words to say absolutely nothing. Reformed ticket prices, reformed working practices and increased reliability—that is what all our constituents want, and the consequence of their rush to implement their ideology is that they brought forward this plan without any evidence for why it will deliver any of that.
Laurence Turner
I thank the shadow Minister for giving way and I compliment him on his staying power during a very long debate. He talks about fares and affordability. Can he explain why, under the Government who have just exited office, fares increased on average by 4.7% each year, almost one and a half times higher than the rate under the previous Labour Government?
Dr Mullan
The challenge that Labour now has to face is whether they choose taxpayers or fare payers to meet the burden of the cost of the railways. In fact, in recent years we kept rail fare rises below inflation, and we have yet to hear a similar commitment from the Government.
The impact assessment on the policy is very clear about what the Government have committed to achieve: absolutely nothing. It says it in black and white, on page 3:
“specific quantified targets for each objective have not been set”.
So clearly that leaves us on the Conservative Benches to hold them to account. I have a number of questions that I hope the Minister can address in his closing remarks.
First, what will be the exact timetable for renationalisation? We might assume that the Government are rushing to do this so that they can begin with Greater Anglia and West Midlands Trains in September, but all they have said is that they want all the contracts nationalised by October 2027. The Minister will understand the uncertainty that will create for the sector, so can he confirm a more detailed plan to the House for making use of the powers they are asking for?
Secondly, what will be the approach on nationalising terms and conditions? The Minister will know there are a variety of working practices across the railway network, many of them clearly not in the best interests of passengers and taxpayers—for example, the varied approach on mandatory Sunday working, where clearly passengers would be better served by that becoming standard; or annual leave, where again passengers would experience less delays and cancellations if drivers were required to give a reasonable amount of notice. Will the Government introduce a standard contract that prioritises the terms and conditions across the industry that will benefit passengers and taxpayers, or will they be letting the unions dictate a standardised contract that puts the unions first and passengers last?
Thirdly, what plans does the Minister have to secure increased passenger numbers, by how much and by when? We have seen a huge increase in passenger growth since the introduction of the train operating companies. What will take the place of contract incentives to secure that growth in future?
Fourthly, on modernisation, people up and down the country have seen the explosion of technology into our workplaces, but all across the network modernisation is blocked and frustrated with demands of more money from the unions for the introduction of technology. What plans do the Government have, as they directly take over running the railways, to ensure that technological innovation can be implemented across the network without undue barriers or union demands getting in the way?
Fifthly, when it comes to funding, how will they be reallocating the theoretical money saved? They argue they will save £150 million from management fees. Reinvesting that across track and train would mean, in total, a 0.5% to 0.75% increase in the overall annual budget. They need to tell us what exactly it is they will be doing with that money that is apparently going to radically improve our railways.
Sixthly, what are the balance sheet implications? The franchising model allowed the purchase of new trains and other investments to be made with no impact on public debt. Will Labour be adding those costs to public debt in future as yet another excuse for their inevitable tax rises?
Finally, what are the Bill’s implications, direct or indirect, for open-access operators? Whatever the Government may say, I am afraid that the implication of their words and actions is that they do not want the private sector running train services, so are they going to turn their sights on those operators next? If they truly believe in what they are doing—if it is not just designed to appease the left wing of their party—they will have to justify their own inconsistency.
It seems pretty clear that this, the Government’s political priority, is the wrong approach at the wrong time. They should be focusing on getting their union backers to stop frustrating reform of our railways. They should be focusing on taking forward our plans for Great British Railways. They should, at the very least, be transparent with the public about the implications of this rushed plan for fares, punctuality and reliability. There is consensus in the House that a new way of working was needed, and we had begun the process of bringing that forward, but Labour Members are more concerned with re-fighting the political battles of the 1970s and 1980s. Whatever they may say, these are the same old ideas, this is the same old ideology, and this is the same old Labour party.
Grahame Morris
The hon. Gentleman is presenting an interesting proposal. He has talked of “evidence”. If we look back over the past few years, we see that 70% of train operating companies running train franchises in this country were Government-owned—owned not by the UK Government, but by the Governments of Germany, the Netherlands and Italy. Was this not dogma to prevent an evidence-based build-up around the east coast main line franchise, providing profit and an income stream?
Dr Mullan
Let me point out to the hon. Gentleman that we also saw an increase of more than 89% in passenger numbers on our railways, and a record level of investment. If taxpayers in other countries want to invest in our railway services, I welcome that. As the shadow Secretary of State said in her opening remarks, we have proved our lack of adherence to ideology by running, when necessary, a number of private sector operators. The point that the Labour Government have to answer is this: if they are so concerned about Avanti and other private sector operators, they have the necessary powers and could do that tomorrow. If they are so convinced of their ability to sort all this out simply through nationalisation—if they are so convinced that Avanti’s performance is one that requires them to step in—let them do it tomorrow. They are not in opposition any more, so they can take steps to do things that they criticise us for not doing.
However, I am afraid that this is the same old Labour: more government good, private sector bad; unions first, passengers last. We on this side of the House have seen it and heard it all before, and we will make sure that everyone knows what Labour has spent its time focusing on and what it has put first when legislating here, politics and ideology, instead of focusing on what will actually make a difference to passengers.
The Parliamentary Under-Secretary of State for Transport (Simon Lightwood)
May I first congratulate you on your election, Madam Deputy Speaker? It is a pleasure to close the debate with you in the Chair.
It may have escaped the notice of Opposition Members, but there was a general election, and there is a reason for the fact that they are sitting on that side and we are sitting on this side. However, I have enjoyed listening to the many maiden speeches that have been made today. It has been just over two years since I made my own maiden speech, and I found it extremely nerve-racking, so I am greatly impressed and, I have to say, somewhat intimidated, by the quality of the speeches made today. I am also grateful to colleagues for their considered contributions, and I will attempt to respond to as many questions and concerns as possible. Where I have not been able to do so, I will follow those up with a letter.
Let me begin by dealing with the issue of public ownership. According to the shadow Secretary of State, the hon. Member for Faversham and Mid Kent (Helen Whately), we have no proof that it will improve outcomes for passengers, but that is clearly not the case. We know for a fact that this Bill will save tens of millions of pounds in fees, and if that is not a good start, I do not know what is.
Furthermore, as the Secretary of State explained earlier, this reform is based on solid evidence. In fact, the public sector has an incredibly strong record of successful delivery, including increased reliability—even when dealing with operators that were previously failing financially, or otherwise failing to deliver for passengers.
I am confident that public ownership will provide the right foundations to drive forward improvements for passengers—be it simplifying the arcane fares system, integrating rail with other transport or improving accessibility. First and foremost, it will deliver the standards of reliability that the travelling public have every right to expect. I remind the House that this is one of two Bills, and that the second will deliver the Government’s wider plans for rail. As my hon. Friend the Member for Luton South and South Bedfordshire (Rachel Hopkins) says, those wider plans are absolutely designed to put passengers back at the heart of the railways and will introduce new measures to protect their interests.
Let me assure the shadow Secretary of State that the wider railways Bill is absolutely a priority for this Government, unlike the previous Government, who had years to bring forward legislation to reform the railways and only got as far as a draft Bill. We are not delaying; rather, we are taking the time to develop the much larger Bill properly, so that it delivers the benefits that we have promised. I look forward to bringing it before the House later in this Session when parliamentary time allows. Under that Bill, the Secretary of State will be the passenger-in-chief and hold Great British Railways to account for delivering for passengers and freight. We will also create a powerful passenger-focused watchdog, the Passenger Standards Authority, to independently monitor standards and champion improvement in service performance against a range of measures.
I am glad that the issue of freight has been raised today. Alongside the overall growth targets set by the Secretary of State, the wider railways Bill will include a statutory duty on Great British Rail to promote the use of rail freight, to ensure that freight remains a key priority.
My hon. Friend the Member for Middlesbrough and Thornaby East (Andy McDonald) is absolutely right to say that it is shameful that the previous Government’s approach to industrial relations was a failure, which inflicted two years of disruption and misery on millions of passengers. By contrast, this Government will work with unions to mediate disputes. In her first weeks in office, my right hon. Friend the Secretary of State has met representatives of the relevant unions.
My hon. Friend the Member for Hertford and Stortford (Josh Dean), in an excellent maiden speech, raised a very important point about staff shortages on our railways. That is a result of the previous Government’s failure to plan properly for the future, leading to skills and recruitment gaps. It is, of course, important that the right staff with the right skills are in the right place at the right time to provide the level of service that passengers expect and deserve. My ministerial colleagues and I look forward to working with train operators and trade unions on this issue. I wish my hon. Friend well in his endeavours to bring more young people into politics—something we should all be passionate about.
On ticket fares, I share the shadow Secretary of State’s ambition for lower fares for all passengers. We are taking pragmatic steps towards that and are committed to reviewing the overly complicated fares system, with a view to simplifying it and introducing digital innovations. We will explore the options for expanding ticket innovations such as digital pay-as-you-go and digital season tickets across the network. We are aware that increasing passenger numbers is critical to this plan, and that is what our simplified system will aim to do.
The shadow Secretary of State and the hon. Member for Bexhill and Battle (Dr Mullan) raised concerns about the ideology of our approach. I can assure them that our plans are not a return to the days of British Rail and that our approach is not ideological; it is pragmatic. We will take the best lessons from the public and private operation of railways. It is about making sure that the system is right, with checks and balances, growth incentives and proper accountability. We have been clear that our approach means a relentless focus on the interests of passengers and the taxpayer above all else. The same applies to the shadow Secretary of State’s claim that the Government’s plans are about putting politicians in charge, which could not be further from the truth. The point of Great British Railways is to get day-to-day decisions out of the hands of politicians and into the hands of those who are best placed to make such decisions, with the needs of the passenger and the freight user at the heart of the whole system.
The shadow Secretary of State mentioned the Chancellor’s statement. The Chancellor has made some very hard decisions on the basis of the dire financial situation that we have inherited from the previous Government, but this does not change the fact that providing better transport for our citizens is an absolute priority, and we will not waver in our pursuit of better rail services for all.
I also thank the hon. Member for Bath (Wera Hobhouse) for her comments and share her view that intervention is needed. However, let me assure her that we are well aware that this cannot come at the expense of other vital services. I assure her that our plan to fix Britain’s railways is fully costed and will be delivered within our fiscal rules. It will improve services and reduce costs to the public purse.
The hon. Members for Bath and for Moray West, Nairn and Strathspey (Graham Leadbitter) and my hon. Friend the Member for Easington (Grahame Morris) also highlighted the role of the rolling stock leasing companies. This is another area where the Government’s approach is pragmatic, delivering value for the taxpayer and not driven by ideology. It would not be responsible to spend billions of pounds of taxpayers’ money buying up existing rolling stock, especially when, as my right hon. Friend the Chancellor of the Exchequer has set out this afternoon, we face a £22 billion black hole in the public finances created by the Conservatives.
I completely agree with the right hon. Member for Aldridge-Brownhills (Wendy Morton) on the importance of rail links to local communities, and I welcome her constructive attitude to this debate. I deeply sympathise with the points she made, and those made by the hon. Member for Didcot and Wantage (Olly Glover), my hon. Friend the Member for Liverpool Wavertree (Paula Barker) and others, about the Avanti West Coast service. As my right hon. Friend the Secretary of State set out, she has already met with Avanti to make her expectations clear. However, the right hon. Member for Aldridge-Brownhills will appreciate the need to bring services into public ownership as existing contracts expire, to avoid the need to pay a penny in compensation to the operators for earlier termination. That does not change the fact that the Government care deeply about performance and will hold private operating companies to account for the remainder of their contracts.
To reassure my hon. Friend the Member for Derby North (Catherine Atkinson), I will also highlight that contracts can be terminated early if the relevant contractual conditions are met, and we will not hesitate to do so if needed. She also raised the important issue of ticket office closures, as did the hon. Member for Taunton and Wellington (Mr Amos) in his excellent maiden speech. I confirm that this Government have no plans to close ticket offices.
The right hon. Member for Aldridge-Brownhills and the hon. Member for Bexhill and Battle also asked about open access services. We have been clear that there will remain a role for open access services, with existing operators continuing to operate on the network alongside publicly owned services, where they add value and capacity to the network.
Finally, the hon. Member for Brighton Pavilion (Siân Berry) highlighted the role of Transport for London and Merseytravel. How to secure the delivery of services in those areas will remain a matter for local leaders. The wider railways Bill will give local leaders a statutory role in governing, managing, planning and developing the rail network. This, along with our plans to give local authorities more control over bus services through our better buses Bill, will make it more straightforward to integrate the railways with other forms of transport.
I would like to thank hon. Members again for an excellent and considered debate on this “Cinderella topic”, as the hon. Member for Didcot and Wantage called it, and I welcome further engagement from both sides of the House as the Bill progresses. With that, Madam Deputy Speaker, I commend the Bill to the House.
Question put, That the Bill be now read a Second time.
Passenger Railway Services (Public Ownership) Bill
Tuesday 3rd September 2024
(2 months, 2 weeks ago)
Commons ChamberRead Full debate Passenger Railway Services (Public Ownership) Bill 2024-26 Read Hansard Text Watch Debate Read Debate Ministerial Extracts Amendment Paper: Committee of the whole House Amendments as at 3 September 2024 - (3 Sep 2024)
18:34 - The Committee having divided: - Ayes: 111 / Noes: 362 - Question accordingly negatived.
18:53 - The Committee divided: - Ayes: 113 / Noes: 372 - Question accordingly negatived.
19:10 - divided: - Ayes: 82 / Noes: 360 - Question accordingly negatived.
The Second Deputy Chairman of Ways and Means (Caroline Nokes)
I remind Members that in Committee they should not address the Chair as Madam Deputy Speaker. Please use our names when addressing the Chair. “Madam Chair”, “Chair” and “Madam Chairman” are also acceptable.
Clause 1
Prohibition on franchise extensions and new franchises
Helen Whately (Faversham and Mid Kent) (Con)
I beg to move amendment 18, page 1, line 12, at end insert—
“25B Report on impact of prohibition on franchise extensions and new franchises
The Secretary of State must lay before Parliament—
(a) within six months of the coming into force of the Passenger Railway Services (Public Ownership) Act 2024, a report on the anticipated impact of the prohibition on franchise extensions and new franchises under section 25A; and
(b) after a period of five years has elapsed after the coming into force of the Passenger Railway Services (Public Ownership) Act 2024, a report outlining the actual impact of the prohibition on franchise extensions and new franchises under section 25A.”
The Second Deputy Chairman
With this it will be convenient to consider:
Clause stand part.
Amendment 19, in clause 2, page 2, line 14, at end insert—
“(1AA) Before making a direct award of a public service contract to a public sector company under subsection (1A), the relevant franchising authority must provide information to the Office of Rail and Road on the public sector company’s ability to become responsible for the provision of the relevant passenger railway services.
(1AB) The information provided under subsection (1AA) must include an overview and analysis of the capacity of the public sector company to provide the relevant services while maintaining or improving existing service provision.
(1AC) Following the receipt of the information provided under subsection (1AA), the Office of Rail and Road must publish an opinion on whether it is reasonably practicable for the public sector company to provide, or secure the provision of, the relevant passenger railway services.”
Amendment 13, page 2, line 17, at end insert—
“(1BA) Every contract made in accordance with subsection (1A) shall place a duty on the public sector company to encourage and invest in innovation across all aspects of its operations, including but not limited to—
(a) operational efficiency;
(b) fares and ticketing;
(c) stations and onboard services;
(d) passenger information; and
(e) digital transformation.”
Amendment 14, page 2, line 17, at end insert—
“(1BA) Every contract made in accordance with subsection (1A) shall place a duty on the public sector company to consider the needs of—
(a) passengers;
(b) residents of rural areas;
(c) residents of areas underserved by the rail network; and
(d) the wider rail network
when considering making changes to existing service levels.”
Amendment 1, page 2, line 22, leave out subsection (3).
Amendment 6, page 2, line 22, at end insert—
“30ZA Impact on provision of rolling stock
(1) The Secretary of State must, within six months of the coming into force of the Passenger Railway Services (Public Ownership) Act 2024, lay before Parliament a report on the impact of the awarding of public service contracts to public sector companies under section 30(1A) on the provision of rolling stock by rolling stock leasing companies.
(2) The Secretary of State must consult with other franchising authorities before finalising a report under subsection (1).”
Amendment 7, page 2, line 22, at end insert—
“30ZA Impact on procurement
(1) Within six months of the coming into force of the Passenger Railway Services (Public Ownership) Act 2024, the Secretary of State shall publish details of the Government’s proposed approach to procurement once passenger rail services are provided by public sector companies under public service contracts awarded under section 30(1A) and the impact of the awarding of such contracts to public sector companies on procurement processes.
(2) Any publications relating to the Government’s proposed approach to procurement under subsection (1) should include details of the approach towards—
(a) technological development;
(b) the management of demand and supply;
(c) the supply chain;
(d) future sectoral planning.”
This amendment would require the Secretary of State to publish details of the Government’s proposed approach to procurement and the impact of the Bill on procurement processes.
Amendment 8, page 2, line 22, at end insert—
“30ZA Independent financial monitoring of public sector companies
(1) The Secretary of State must, within three months of the coming into force of the Passenger Railway Services (Public Ownership) Act 2024, instruct an independent body to conduct monitoring of the financial management of any public sector company with whom a direct award of a public service contract is made under section 30(1A).
(2) For the purposes of subsection (1), “monitoring of the financial management” includes the auditing of accounts, the review of spending efficiency, and the making of recommendations to improve cost-effectiveness.”
Amendment 9, page 2, line 22, at end insert—
“30ZB Report on cost of contracts with public sector companies
(1) The Secretary of State must, within three months of the coming into force of the Passenger Railway Services (Public Ownership) Act 2024, instruct an independent body to report on the total cost to the Government of contracts awarded in accordance with section 30(1A).
(2) The first report under this section must be laid before Parliament within twelve months of the first award of a public sector contract in accordance with section 30(1A), with subsequent reports to be laid annually.
(3) Any report published under this section must include consideration of any liabilities previously held by franchises which are now public sector liabilities.”
Amendment 10, page 2, line 22, at end insert—
“30ZC Annual reporting of performance of publicly-owned train operating companies
(1) The Secretary of State must lay before Parliament an annual report on the performance of public sector companies to whom public service contracts are made under section 30(1A).
(2) An annual report published under subsection (1) shall include details of a company’s—
(a) financial performance;
(b) revenue growth;
(c) cost control;
(d) innovation;
(e) service quality metrics;
(f) customer satisfaction metrics; and
(g) value for money.
(3) The first annual report under this section must be laid before Parliament within twelve months of the first award of a public sector contract in accordance with section 30(1A).”
Amendment 11, page 2, line 22, at end insert—
“30ZD Performance-based assessment of publicly-owned train operating companies
(1) Public sector companies with whom public service contracts are made in accordance with section 30(1A) are to be subject to performance-based assessments in relation to their management of the relevant passenger railway services.
(2) Performance-based assessments of public sector companies under subsection (1) are to be conducted by an independent body instructed by the Secretary of State.
(3) In conducting a performance-based assessment the independent body must assess the public sector company against published targets in relation to—
(a) the punctuality of services;
(b) customer satisfaction;
(c) revenue and passenger growth; and
(d) operational efficiency.
(4) Every contract made in accordance with section 30(1A) must place duties on relevant public sector companies—
(a) to prepare performance improvement plans where published targets are assessed under this section as not being met;
(b) to place limitations on the remuneration of senior managers while a performance improvement plan is in force.”
Amendment 12, page 2, line 22, at end insert—
“30ZE Impact on performance and efficiency of the UK rail network
(1) The Secretary of State must, within five years of the coming into force of the Passenger Railway Services (Public Ownership) Act 2024, instruct an independent body to conduct a review of the impact of the Act on the performance and efficiency of the UK rail network.
(2) A report on the findings of the review must be laid before Parliament.”
Amendment 15, page 2, line 22, at end insert—
“30ZF Impact on open access operators
The Secretary of State must, within twelve months of the coming into force of the Passenger Railway Services (Public Ownership) Act 2024, lay before Parliament a report on the impact of the awarding of public service contracts to public sector companies under subsection 30(1A) on open access operators in the UK.”
Amendment 16, page 2, line 22, at end insert—
“30ZG Impact on exemption of passenger services
(1) The Secretary of State must, within twelve months of the coming into force of the Passenger Railway Services (Public Ownership) Act 2024, lay before Parliament a report on the impact of sections 25A and 30, as amended by the Passenger Railway Services (Public Ownership) Act 2024, on the exemption of passenger services under section 24.
(2) A report under subsection (1) must include whether the coming into force of the Passenger Railway Services (Public Ownership) Act 2024—
(a) has made, or is expected to make, it more or less likely for an application for an exemption to be made to an appropriate designating authority;
(b) has made, or is expected to make, it more or less likely for an application for an exemption to be granted by an appropriate designating authority;
(c) has made, or is expected to make, any difference to the basis on which decisions as to the granting or refusing of applications for exemptions will be made by the appropriate designating authorities.”
Amendment 17, page 2, line 22, at end insert—
“30ZH Independent body to advise on pay and terms and conditions of employment for employees of public sector companies
(1) The Secretary of State must, within three months of the coming into force of the Passenger Railway Services (Public Ownership) Act 2024, establish an independent body with responsibility for—
(a) providing advice to Government on the—
(i) remuneration, and
(ii) terms and conditions of employment
of employees of the public sector companies providing passenger railway services under a contract awarded in accordance with section 30(1A);
(b) advising the Government on value for money during the negotiation of the terms and conditions of employment of employees of the public sector companies providing passenger railway services under a contract awarded in accordance with section 30(1A); and
(c) preparing an annual report to be laid before Parliament by the Secretary of State on the terms and conditions of employment of employees of the public sector companies providing passenger railway services under a contract awarded in accordance with section 30(1A).
(2) Advice provided in accordance with subsections (1)(a) and (b) shall be based on annual investigations of working practices conducted by the independent body and consider—
(a) value for money;
(b) affordability;
(c) domestic and international comparators;
(d) the future of the rail network, including the modernisation of working practices.
(3) Advice provided in accordance with subsection (1)(b) shall include advice on whether any conflicts of interest exist between any Government Minister and any union involved in the negotiation of the terms and conditions of employment, and how any such conflicts should be managed.
(4) An annual report under subsection (1)(c) shall include a comparison with the terms and conditions of employment under the franchise which provided the relevant passenger railway services prior to the awarding of a contract in accordance with section 30(1A).
(5) The first annual report under subsection (1)(c) must be laid before Parliament within twelve months of the first award of a public sector contract in accordance with section 30(1A).”
Amendment 22, page 2, line 22, at end insert—
“30ZA Review of impact on exemption of passenger services
(1) The Secretary of State must, within one year of the coming into force of the Passenger Railway Services (Public Ownership) Act 2024, conduct a review of the impact of that Act on the exemption of passenger services under section 24 of this Act.
(2) A review conducted under subsection (1) must consult—
(a) the Scottish Ministers;
(b) the Welsh Ministers; and
(c) English combined authorities
on their willingness and ability to make an application to the appropriate designating authority for the grant of an exemption from designation under section 23(1) for the purposes of applying for or being awarded a public service contract under section 30(1A).
(3) The Secretary of State must lay a report on the findings of the review before Parliament.”
Amendment 2, page 3, line 23, after “Scottish Ministers” insert—
“or an elected public body”.
This amendment, and accompanying Amendments 3, 4 and 5, would expand the definition of “public sector company” to enable public service contracts to run passenger railway services to be awarded to public sector companies owned by local elected public bodies.
Amendment 3, page 3, line 25, after “Ministers” insert—
“or an elected public body”.
See explanatory statement for Amendment 2.
Amendment 4, page 3, line 27, after “Ministers” insert—
“or an elected public body”.
See explanatory statement for Amendment 2.
Amendment 5, page 3, line 27, at end insert—
“(ba) ‘elected public body’ means a body which is—
(i) a mayoral combined authority;
(ii) a combined authority; or
(iii) a unitary, county, district or borough council
or which is composed of more than one of the bodies listed above.”
This amendment in consequential on Amendments 2, 3 and 4.
Amendment 20, page 3, line 32, at end insert—
“30D Independent body to provide advice on proposed contracts
(1) The Secretary of State shall, within three months of the coming into force of the Passenger Railway Services (Public Ownership) Act 2024, establish an independent body with responsibility for advising the Secretary of State on contracts proposed to be made in accordance with section 30(1A).
(2) The independent body must provide advice to the Secretary of State, including recommendations as to how or whether to proceed with the agreeing of the contract, within three months of a request for such advice being made by the Secretary of State.
(3) Should the Secretary of State wish to proceed with the agreeing of a contract—
(a) having received advice against proceeding with the agreeing of the contract from the independent body; or
(b) without taking such steps as were recommended by the independent body,
the Secretary of State must make a statement in Parliament of the reasons for doing so.
(4) The Secretary of State shall consult other franchising authorities before finalising proposals for the establishment of the independent body under subsection (1).”
Amendment 21, page 3, line 32, at end insert—
“30D Annual report on ticketing effects of public service contracts
(1) The Secretary of State shall lay before Parliament an annual report on the effect of public sector contracts awarded in accordance with section 30(1A) on—
(a) ticket pricing,
(b) tap-in, tap-out options,
(c) single-leg pricing,
(d) digital season tickets,
(e) compensation for delays and cancellations,
(f) ticketing interoperability with—
(i) other train operators, and
(ii) bus and light rail system operators.
(2) The Secretary of State shall consult other franchising authorities before finalising a report under subsection (1).
(3) The first annual report under this section must be laid before Parliament within twelve months of the first award of a public sector contract in accordance with section 30(1A).
(4) Each subsequent annual report must be laid before Parliament before the end of July in each subsequent calendar year.”
Clauses 2 to 4 stand part.
The schedule.
Helen Whately
It is good to see hon. Members so soon after the summer recess. I know that the Secretary of State for Transport, the right hon. Member for Sheffield Heeley (Louise Haigh), has been busy over the summer, but I hope that she managed—like the Deputy Prime Minister—to find some time to let her hair down.
When we last met, I set out why the Conservatives cannot support the Bill. I do not doubt that Government Members sincerely believe in their plan, in getting rid of privately run train operators, and in putting politicians in charge of running train services, but just because an ideological belief is deeply held, that does not make it right. It is certainly not the same as using evidence as a basis for decision making.
Our railways are vital to our economy: millions of people rely on trains, whether to get them to work or school, to make essential journeys, to see family and friends, or simply to visit other parts of the country. Our rail system is complex—a mix of public and private built up over many years. One thing it is not, though, is a toy train set to be played with, but I fear that is the approach this Government are taking. They are rushing through this ideological reworking of our rail system despite the absence of solid evidence to back up their approach, at a time when other countries are choosing to increase private sector involvement and competition in their rail systems.
There is no good reason for this Committee stage to be raced through in one day, rather than through a normal Bill Committee that would allow proper time for consideration and discussion, the time appropriate for such a substantial and significant change. Proper time would allow this legislation to be made better—indeed, fit for purpose—drawing on the strengths of our rail system as well as the weaknesses, and using the lessons of our experience and that of others, while still fulfilling the Government’s intention as set out in their manifesto. Instead, in their haste, this Bill simply takes a one-size-fits-all approach, pulling the plug on even the best train operating companies despite the mixed record of the Department for Transport when it comes to the performance of the franchises it runs already.
In the Government’s haste, the Bill lacks any controls or incentives to reduce the risk of increased costs to taxpayers and passengers. We can say the same for performance: where in this Bill are the incentives to improve that, or the protections for passengers should performance worsen when the right hon. Member for Sheffield Heeley is at the controls of our trains? In the Government’s haste, those things are missing too. In their haste, if they do what they said in their manifesto, they are going to bring thousands of rail workers into the public sector, all under a single Government employer. We will have unions reclining comfortably on ministerial sofas as they discuss pay for thousands of people, funded by the taxpayer, with no safeguards to speak of to make sure the taxpayer gets a good deal.
On Second Reading, I said that some more thought should go into the Bill over the summer. I asked a series of questions and made a number of suggestions. At the very least, I was expecting the Government to table some amendments, but I am sorry to report that, as far as I can see, they are going full steam ahead. There is no sign that any serious thought has been given to the long-term impact of Government-run train companies on growth, or on the efficiency of our railways. There is barely a word on the liabilities that this Bill would transfer on to the Government’s balance sheet, and crucially, no evidence has been shared about how passengers and their journeys will be affected.
Fundamentally, the Government are rushing ahead but travelling blind, pressing on irrespective of the impact on passengers or taxpayers, which they simply do not know. The right hon. Lady has made herself passenger-in-chief and then set off on a journey without knowing the destination. That is not a sensible way to govern. Passengers should always come first, above providers, unions and ideology. That is why our first amendment would require the Government to set out what impact they believe the Bill will have.
Nadia Whittome (Nottingham East) (Lab)
I find the hon. Member’s comments on public ownership a bit rich, given that privatisation of our railways has spelled 30 years of failure—30 years of delays and price increases for passengers, and eye-watering profits for private companies. Most people in the UK opposed privatisation at the time, and most people still oppose it today; in fact, a clear majority of her own party’s voters oppose the privatisation of the railways. Can she not see that the Secretary of State, in bringing forward this Bill, is serving the interests of our constituents?
Helen Whately
Unfortunately, the hon. Member is simply wrong in some of the statements she makes. I am not ideological about this—I know that there is a place for the public sector and a place for the private sector. In our reforms, we proposed a closer working together of track and train through Great British Railways, much of which this Government are planning to bring forward. However, there have also been benefits to this country from privatisation, including a significant growth in passenger numbers, which has not been seen in many other countries. That is one reason why several European countries are planning to follow our model and increase competition in their rail services, in order to drive up passenger numbers and provide greater efficiencies.
As I said a moment ago, amendment 18 would require the Government to set out what impact they believe the Bill will have. For instance, what impact will getting rid of private sector train companies—the good performers as well as the weaker ones—have on passengers, fares, reliability and the cost of the railway to taxpayers? The amendment proposes that the Government should set that information out clearly in a report within the next six months. I am sure that hon. Members do not consider that to be unreasonable; surely, it is the least that any of us would want to see, since we all represent both rail users and taxpayers. It would mean that we would all know what difference the Government expect the legislation to make. I would hope that the report would be set out in a way that stands up to scrutiny, that it draws on evidence and that it has a suitable level of rigour for something so significant. It would also give us all something to hold the Government to account against, as well as the managers who take over responsibility for train operators.
Andy McDonald (Middlesbrough and Thornaby East) (Lab)
The shadow Minister asks about the benefits that will accrue if this change is made. We on the Labour Benches have been working on it for years, so the suggestion that it has somehow been rushed is a nonsense. May I gently point out to her that over the years that this change has not been made, millions if not billions of pounds have been shipped out of this industry to subsidise and support other nation states’ railway systems? If ever there was a nonsense, that is it, staring us in the face. She talks about ideology: the ideology of privatisation has been ruinous for the railways, and it is about time that it was corrected.
Helen Whately
There are a few problems with what the hon. Member has just said. One is that he talks about those figures, but the Government have not taken the time or trouble to set out what the impact of the Bill on passengers and taxpayers is expected to be. Were the Government confident about that impact, I am sure they would have set it out, but they have not. That is why our amendment proposes that they should set it out. We also know that while on the one hand, there are some savings to be made from management fees—I will come to that later in my speech—the benefits of competition, and the pressure of profit and loss and the bottom line, drive innovation and bring efficiency. That does not necessarily happen to the same extent in the public sector.
Helen Whately
No, I will make some progress.
For the reasons I have described, we have also tabled amendments to put some conditions on franchises moving into the public sector. Under the Secretary of State’s plan, the running of trains on our network will increasingly be tasked to a little-known Government company called DFT OLR Holdings Ltd, or DOHL, the current operator of last resort. It seems to me a huge risk to expect DOHL to successfully take over and run every franchise in the country. DOHL has had, shall we say, mixed results with the franchises it has taken over, and expecting it to run a further 10 on top of the four it is currently operating strikes me as a lot to ask. I recognise that the Bill makes reference to that risk by providing for franchise extensions where it would not be practical to bring the service in-house, but under the current plans, that would be decided by the Secretary of State. It is not that I do not trust the right hon. Lady, but she has shown herself to have a great deal of confidence in public operators, in the absence of any substantial grounds for that confidence.
I have been told that there is no plan to increase headcount, budget or resources of any kind for DOHL as it takes on that increase in workload from four to 14 franchises. I welcome the Government making an effort to achieve efficiencies at the centre, but I struggle to believe that more than tripling the number of franchises brought in-house will not involve some increase in resources. We therefore think it would be prudent for the Office of Rail and Road to form an independent judgment on whether DOHL has the capacity and expertise to take on each new franchise as it comes up, and to run it, at a minimum, as well as it is already being run. That could be done well in advance of most contracts ending, so it would not really be a hindrance to the Secretary of State’s plan, but it would provide a great deal of reassurance to passengers, and all of us as their representatives, about the capacity of the Government to successfully take over the functions of so many train operating companies.
Grahame Morris (Easington) (Lab)
On impact assessments and how we can have confidence that DOHL will improve performance, we can look at past performance. I remind the shadow Minister that the operator of last resort currently runs 14 franchises. Since the east coast main line, which serves my region, was taken over by LNER, revenues have grown substantially. Since TransPennine Express was brought back into public sector operations in May 2023, we have seen cancellations decrease from an average of around 20% to 5%. In the last quarter, TransPennine, which is run by the operator of last resort, DOHL, was the most improved operator in terms of cancellation scores compared with the same period last year.
Helen Whately
I accept some of the points that the hon. Gentleman made. That is why I said that the record of DOHL had been mixed. Sometimes there has been improvement in performance, but that is not the case for all the franchises it runs. That is my reason for not being confident that it is the right organisation to take on such a large increase in its workload, particularly without any further increase in its resources, including some operators that are performing better than the train companies that he mentioned.
We want every contract that is awarded to place a duty on DOHL to look at how to modernise our network and to ensure that passengers are at the forefront of all decision making—passengers not just in urban areas and around London but, crucially, in rural areas and places that have traditionally been under-served by the rail network. Time and again, the Secretary of State has said that her No. 1 priority is passengers—that she will protect their interests above all else, and that it is for them that she is seeking this change. This is a chance to put her money where her mouth is and create a legal duty that promotes the needs of passengers in all future agreements with public sector operators. That will build in a layer of accountability on things that we all agree are important.
On amendment 8, public bodies marking their own homework is not something that Opposition Members believe leads to good results. I know from my time in government that independent scrutiny makes life harder for Ministers, but it also improves accountability, and with that outcomes. That is why we seek to introduce proper financial reporting and oversight for public sector operators. Under the franchise system, whatever its shortcomings, train operators are incentivised to increase passenger numbers and control costs. That has been an undeniable success of privatisation. Passenger numbers have doubled and costs have been controlled, increasing at a far slower rate than revenue.
In future, passengers and taxpayers will have to foot the bill for any loss of control on costs, any inefficiencies or any failures to innovate. That is a serious implication, and something we should do our best to protect people from. Creating, or recreating, some incentives is a good place to start. We will need to know how well the public train companies are performing—what they are doing to increase passenger numbers and drive growth in rail services, how reliable their services are, how well they are keeping costs under control, and how satisfied passengers are with the service they provide.
Our proposals will allow us to identify both good and bad performance, hold the managers of those companies to account and reward them accordingly, such as by linking managerial pay to performance. Those companies will no longer have shareholders to answer to, or the financial incentives that go with a senior role in the private sector. The Government have told us that part of their rationale for these changes is to better align the incentives of train operators with the interests of passengers, but the Bill currently provides no mechanism for that. We are not seeking to frustrate a change that this Government were elected to deliver; we simply wish to bring proper transparency and accountability to the process. That includes reporting on the costs involved in bringing operating companies into public ownership.
Government Members will no doubt point to the money that will be saved by removing management fees, but this equation is not one-sided. While the Secretary of State might be saving £150 million each year on fees, industry experts have predicted that the Bill could cost passengers and taxpayers up to £1 billion a year in lost productivity and growth—and that is before accounting for the Government’s taking on all the long-term liabilities of the companies. Pension obligations, rolling stock and long-term leases will all be transferred on to the Government balance sheet, and we have had alarmingly little information on what that figure will be.
Richard Burgon
The shadow Secretary of State is making a case from her ideological point of view, although she denies it. Running through her speech is a deep suspicion of the public sector. Suddenly she is suspicious about the quality of service for passengers. Suddenly she is suspicious about the quality of service provided, and the amount of money being spent on it. If only those suspicions and that scrutiny had been applied by the shadow Secretary of State and her colleagues while they were in government to the disastrous privatised railway service. Is she really trying to convince this House that privatisation of the railways was in any way a success? It seems to me that she is trying to stand as a barrier to public opinion and the Bill’s progress, because the majority of people in this country support public ownership of the railways and the Labour Government were elected with that as a clear manifesto pledge.
The Second Deputy Chairman of Ways and Means (Caroline Nokes)
I am sure the hon. Gentleman is about to finish.
Richard Burgon
I am, thank you. I will bring my remarks to a close by asking, is it not the case that the shadow Secretary of State is being deeply ideological and is only interested in the privatised model and the pursuit of profit, regardless of the effect on the public?
Helen Whately
The hon. Gentleman and I probably do have different views ideologically; I will acknowledge that. I think that he probably, as was implied in his intervention, thinks that profit is bad. I think that profit can be a helpful thing, and it is thanks to the motivation of people to make profits that we in this economy, and those in many similar economies, have the prosperity that we enjoy today. I think that Government can do a lot, but I am also thoughtful about when Government can help and when Government might hinder. That is why I take the view that, in rail, sometimes it is right for the public sector to do things and sometimes it is right for the private sector to do things.
One thing that I fundamentally think is missing from the Bill is scrutiny. I am not trying to frustrate the mandate that the hon. Gentleman’s party has to bring forward this legislation—I think I made that clear—but I want to improve it, and improving it involves introducing a level of transparency and accountability that simply is not in the Bill. That is why I tabled my amendments.
We also seek clarity on how the Bill will affect other privately run passenger services on the network. It is clear that deep down, those on the Government Benches know that the public sector cannot, and should not, run every service on the network. That is why open access operators like Eurostar and Gatwick Express have rightly been allowed to continue under these plans.
Open access represents a huge opportunity for passenger rail in this country. When done right it can provide nimble, cost-effective services that give passengers greater choice and bring in revenue for the network. In fact, the EU has enshrined in law the rights of open access operators in tendering for passenger services. We are not proposing that at this stage, but I am concerned about how this change will impact on those already operating on the network, and what opportunities will remain open to them or others to offer new open access services in future.
The same goes for the future of devolved concessionary models. Why, if Government Members truly believe that private providers are simply siphoning off cash, can Transport for London and Merseyside still run concessionary models? While I happen to think they should be allowed to do so, it does not seem fair to have one rule for Sadiq Khan and another for everyone else. What about Manchester, Leeds or Birmingham? What if they want to run their own transport systems in a way that suits them?
My understanding is that the Labour Government want to build on the progress we have made in devolving responsibilities to cities and regions, but this Bill looks more likely to reduce the options for other devolved authorities, leaving them able to run concessionary models only if they get an exemption under section 24 of the Railways Act 1993 to do so.
The Secretary of State for Transport (Louise Haigh)
I would be interested to know whether the hon. Lady has spoken to her immediate predecessor to understand exactly the value of the reforms he was pursuing as Secretary of State, and if she was aware that they were worth less than half the cost of every time the railways went on strike under his leadership.
Helen Whately
Unfortunately, the right hon. Lady’s approach is deeply flawed and risks our facing more strikes in future, rather than fewer. [Interruption.] Yes, to directly answer her question, I can assure her that I have spoken to her predecessor in the role, and I know that the reforms proposed to modernise the railways were crucial not only to controlling increasing costs and fares, but to improving the reliability of our train services. Unfortunately, she gave all that up overnight when she gave away a bumper pay deal of almost 15%, with nothing from the other side to improve services.
The independent body I am proposing would look at pay and terms and conditions in the round. It could shed some light on who is getting a fair deal and help put modernisation at the top of the agenda in negotiations. Given that this Government seem to be set on creating a single huge employer across the network, as set out in their manifesto, which surely means harmonising pay and terms and conditions across many thousands of employees, none of whom I suspect will want to give up whatever terms they most value—a four-day working week, 34 days of annual leave and the extra money they negotiated to start using iPads are some examples—can the right hon. Lady imagine what effect this might have on ticket prices and the efficiency of our network? An independent pay review body could at least gather evidence and advise Government on what makes sense to fill jobs and provide value for money for the taxpayer.
Madam Chair, I am grateful to you for giving me some time to outline our amendments, and I am mindful that other Members wish to talk to their amendments or make maiden speeches, so I will wrap up my comments with a couple of final points. As we made clear on Second Reading, His Majesty’s official Opposition do not support this Bill. Our rail system needs reform, and we have set out plans to do that, but this Bill is not the right way to go about it. On the contrary, the Government are being driven by a flawed ideological belief along the lines of “public sector good, private sector bad”. It is not underpinned by evidence of what works, and they are not being straight with people about the possible downsides such as higher fares for passengers, higher costs for taxpayers and less reliable trains.
Why are the Government rushing through this Bill? Is it to please their Back Benchers, who we know are deeply unhappy about scrapping the winter fuel allowance, or is it to please their union paymasters? I know the right hon. Lady has promised everyone that she is going to move fast and fix things, but this looks more like moving fast and breaking things. I say sincerely to her, as I am sure she will want to make this legislation as good as it can be and, like me, wants to do the best possible job for all our constituents and for the country we serve, that she should please consider the amendments we have tabled and think hard about giving them the Government’s support.
The Second Deputy Chairman of Ways and Means (Caroline Nokes)
As a point of information and for my assistance, it would be very helpful if Members wishing to be called could indicate clearly that they wish to speak.
Several hon. Members rose—
Graham Stringer (Blackley and Middleton South) (Lab)
That was earlier than I expected, Ms Nokes!
Before I come to the amendment I have tabled, I should say that I am probably the only Member in the Chamber who remembers the debate on the National Audit Office report after the original privatisation of rail, and if the hon. Member for Faversham and Mid Kent (Helen Whately) applied her proposal to the original decision to privatise rail, against the criteria the then Government were using, she would find that it has been a complete failure. I remember that when in this Chamber I asked Teddy Taylor, a Conservative I respected greatly, how he justified selling off the railways for less than they were worth, which is what the National Audit Office report said, his justification—the policy of the then Conservative Government—was that it did not matter because they would take all the subsidy out of the railways. Had the hon. Lady been present then and had those tests been applied to the original policy, the Conservatives’ policy of privatisation would be seen to be a complete failure.
The other point I would like to make about what the hon. Lady said, which a number of interventions from the Government side brought out, is that a huge amount of money has been transferred to other rail systems and to pension funds in north America and elsewhere that could have been used to benefit the transport system in this country. Incidentally, one of the reasons why passenger numbers have increased on the railways is that the previous Government did not invest in roads over many years. That has led to congestion which has forced people on to the railways; it is not the privatisation of the railways that has attracted those passengers. Those profits have gone out precisely because the Treasury did not want the debt on the balance sheet, but one cannot have it both ways. If we are to repatriate those profits, which I believe taking the railways back into public ownership will do, we of course have to take the debt. An accountancy sleight of hand, because the Treasury does not like seeing the debt on the balance sheets, is the direct cause of the profits being taken out of this country.
On the Government side of the House, there is real enthusiasm for this Bill, and the sooner the train operating companies are back in public hands and that money is repatriated to this country, the better. However, I share with the shadow Transport Secretary a worry that officials in the Department for Transport may not be up to it. Excuses may be used to slow things down, because the operator of last resort is not ready and they are worried about taking on the extra capacity. It is a genuine worry, but it is a problem that should and has to be overcome if we want a publicly owned railway working for the benefit of passengers and the taxpayers of this country, not a privatised system. I have therefore tabled an amendment to remove clause 2(3), which could be used as a loophole as it would allow the Secretary of State to carry on with a franchise under certain circumstances. I ask my colleagues on the Front Bench to be explicit about what those circumstances might be, because my worry is that they will be getting advice from officials in the Department for Transport who have not covered themselves in glory and have failed with the railways over many, many years.
As the hon. Member for Faversham and Mid Kent likes evidence, I refer her to a Public Accounts Committee report in May that is excoriating in describing the officials in the Department for Transport and how they have dealt with the railway system. I will read some of the conclusions from that report, because it should worry us all if we want this Bill to work—not just to be passed into legislation but actually to work.
The first point made by this all-party Committee with a Conservative majority in May this year was this:
“It has been six years since the Department identified the need for a root and branch review of the railway, but it has achieved very little in this time.”
It then says:
“There has been too little focus on passengers and taxpayers and how to get them a better deal.”
Those are the first very worrying points from Labour’s perspective.
The report also says:
“Six years since the Department started work on rail reform, it has failed to resolve fundamental disagreements and clarify key aspects of reform.”
There are other points too, but I do not want to bore the Committee too much. The last point is:
“The Department has failed to engage with the workforce to successfully deliver its reform ambitions.”
That is also very worrying.
I note as well the comments of an official from the Department when discussing the appalling performance of Avanti, which I think is permanently in breach of its contract and which has laughed at the Government and the travelling public as it has received massive subsidies. It is not working for profit; it is not at risk. It has just been ripping off the taxpayer for many years—since it took over from Virgin in fact. A DfT spokesperson said:
“Stripping Avanti's contract would just cause more upheaval for passengers rather than solving the challenges the operator is facing. These include restrictive working practices that can’t be reformed without ASLEF’s agreement.”
I think those officials could be and have been a barrier to reform. I would not expect my colleagues on the Front Bench to do anything but be loyal to the officials who work in the Department, but I would like them to respond on how they are going to overcome some of the potential problems they will find in a Department they control. There are not only the problems where there will be resistance. Owing to the way the franchises are dealt with, some of the better train-operating companies—such as Greater Anglia, which has a reasonable record—will come up first, whereas Avanti has eight years left on its contract. It seems to me that it would be easy for officials to recommend dealing with the best first rather than the worst, which is not in the interests of passengers or the taxpayer. We really need as a Government to get control of that and deal with the worst first, because that is where we are losing money, that is where passengers are suffering, and that is where money is being taken out of the system. As I say, I do not expect the Front-Bench team to criticise the officials they have to work with, but I hope they will take on board the fact that there are real problems and that we need to deliver right across the rail system to create a wholly publicly owned industry as soon as possible.
Wera Hobhouse (Bath) (LD)
The Liberal Democrats’ first principle is to put the rail user at the heart of any new arrangements for rail passenger services. We are ultimately agnostic about public or private ownership so long as what the Government propose clearly delivers the improvements on our railways that are so desperately needed. I thank Ministers for their prior engagement and for today’s debate. I am aware that the Bill is only a step towards more comprehensive legislation later in this Parliament. We Liberal Democrats have tabled three amendments to address three core issues that are relevant to the Bill but might become even more relevant to any future Government plans.
Amendment 21 is aimed at keeping passenger experience under review. Public confidence in our rail system has been falling year on year. Greater scrutiny is needed of how nationalisation will impact day-to-day travel. Our amendment will ensure that getting a fair deal for passengers is the guiding principle of the Bill.
Christine Jardine (Edinburgh West) (LD)
Does my hon. Friend agree that an essential part of that is addressing the problems that the railways face now? Although the Liberal Democrats are agnostic on nationalisation, as my hon. Friend says, the problems that customers face now are about pricing and timetabling, and this Bill will not address them.
Wera Hobhouse
I thank my hon. Friend for that intervention and repeat that it remains to be seen how quickly that can be addressed. That is really our main point—we will scrutinise the Government on how quickly these changes can be delivered, because that is what all our constituents are really asking for.
Our amendment would ensure that an annual report was published on the effects of public sector contracts, particularly on the ticketing system. Fare hikes, delays and cancellations all contribute to a loss of confidence. Despite that, passenger numbers are up; people want to use our railway as a clean, green way to travel. We agree with the Government that competition is not working as intended, but we cannot expect nationalisation to be a silver bullet that solves all the issues with our rail services. It is therefore vital that the Government get a clear picture and are fully transparent about the public experience throughout the change.
The current ticketing system is simply not fit for purpose. Complicated and inconsistent ticketing is a barrier to rail travel. If we are to meet our climate commitments, green travel must be encouraged. I often hear from my constituents that they find it hard to understand when a ticket is best value for money, which highlights the need to simplify the entire system. When people buy a ticket, the best value fare should be clear and should be displayed first. There have been cases where operator-owned ticket machines have had an in-built bias to sell their own company’s tickets even if they are not the best value. Commuters should not have to jump through hoops to find the most effective price.
Amendment 21 would also require a look at the effects of nationalisation on digital season tickets and compensation for delays and cancellations. Delay repay is another big issue on our rail network. In the last reporting year, train operators closed 7.6 million delay compensation claims. That figure was 30% higher than the previous year even though passenger journeys were only 16% higher. However, current operators treat delay repay claims differently: while some passengers can get automatic compensation if their journey is delayed, others have to fill in complicated forms and have to wait. A unified approach to delay repay is clearly needed to improve passenger experiences, and I agree with my hon. Friend the Member for Edinburgh West (Christine Jardine) that it is absolutely vital that passengers see such changes very quickly, rather than having to wait for a whole-system change.
The same is also the case with season tickets. Annual passes for similar-length rail journeys differ immensely across the country depending on the operator. An annual report scrutinising how nationalisation affects those inconsistencies is essential to reducing them. To ensure that passengers get a fair deal from nationalisation, I urge Members to support our amendment 21.
Amendment 20 aims to bring people further confidence as rail companies are brought into public ownership. The amendment would establish an independent body to review contracts made by the Transport Secretary and public companies. That body would put the customer at the heart of services, as well as delivering, putting commuters first and holding operators to account. The amendment would ensure that if the independent body did not agree with a proposed contract, the Secretary of State must explain to Parliament why they were going ahead. To give the public confidence in our railways, the process of contract allocation must be kept under scrutiny and be fully transparent.
Our third amendment is amendment 22, which would require the Government to review how the transition to public ownership affects services such as Merseyrail and Transport for London. Those services are already under public control, but in those cases the control is local, not national. The amendment would allow more services to be operated by local public bodies in the future—we have discussed that in our pre-meeting. The review would not simply look at direct impacts, but engage with the local public bodies themselves on their capacity and their wish to deliver such services.
If the new Government are serious about devolution, the option for combined authorities to deliver services must be on the table. We have already seen how devolved authorities can deliver rail services effectively. Transport for London and Merseyrail are two such examples. If devolved authorities wish to deliver rail services, there must be a way for them to have discussions with central Government. I understand that such a proposal might be for the future, but it is important we put a marker down here. Amendment 22 provides a mechanism for that process.
Nationalisation must be a means to an end. The public at large do not care who is running the trains as long as there are good services and travel is affordable. Our Liberal Democrat amendments would ensure that the legislation has the passenger at the heart of any changes and that the public get value for money.
Wera Hobhouse
I am coming to the end of my remarks.
The Liberal Democrats want to work with the new Government to improve our railways and deliver a fair deal for passengers. I call on all colleagues to support our amendments.
Catherine Atkinson (Derby North) (Lab)
I will address my remarks to my amendment 7. It is a probing amendment, whose main purpose is to raise and discuss procurement reform.
I start with good news: 100 new jobs at Alstom Derby, refurbishing CrossCountry’s Voyager fleet, in an upgrade worth £60 million. Train manufacturing in Derby was at death’s door some months ago, and now it has a heartbeat, with 10 trains for the Elizabeth line in the pipeline. I thank the Transport Secretary and many other hon. Members for their extraordinary support in the dark days some months ago, when hundreds of jobs at Alstom—thousands when we consider the supply chain and agency workers—were being lost. The city came together to demand action. No one wants to see their city or their workplace go through that, so we need to see an end to boom and bust, replaced with consistency and certainty. We need crisis and sticking plasters to be replaced with long-term funding and stable projects.
We saw a failure to act in that way when privatisation happened. When British Rail was split up, there was real concern that the upheaval would crush the world-renowned expertise in the supply chain in Derbyshire. According to Hansard on 20 December 1994, in that year alone, 5,000 jobs were lost nationally. That was one of the first unnecessary tragedies of privatisation. In spite of that setback, more than 10,000 workers are employed today in Europe’s largest and most diverse rail cluster, centred around Derby. It covers every aspect of the railway supply chain.
Since the Bill’s Second Reading, I have been pleased to visit and meet with rail forum members, including Hübner, Serco, DB ESG, Resonate and Millennium Site Services, which are all enthusiastic about working with this Government to deliver improvements to rail. The Transport Secretary said on Second Reading:
“As private operators are brought in, their contracts and supply chains will be considered, to ensure that they are delivering the best possible service for passengers.”—[Official Report, 29 July 2024; Vol. 752, c. 1074.]
My amendment seeks to establish what details publications related to that consideration should include. Specifically, the amendment suggests that details should include the approach towards
“technological development…the management of demand and supply…the supply chain…future sectoral planning.”
Through better procurement we can also speed up delivery, reduce costs and create social value. That point was made in the Maier rail and urban transport review, which was recently published—I commend the Transport Secretary on commissioning it. One of its valuable recommendations is that the Rail Minister should be given responsibility for working in partnership with business to support the establishment of local supply chain capability. It makes the point that as supply chain capability goes up, costs and skills shortages come down.
I started with the good news of 100 jobs at Alstom, but there is no complacency in Derby, because we are looking five and 10 years ahead, and I know there is no complacency from the Transport Secretary. On Second Reading, my hon. Friend the Member for Easington (Grahame Morris) reminded the House that to meet decarbonisation goals, the UK needs to upgrade up to 4,000 rolling stock units. With management of contracts and sectoral planning, there is enough domestic work to create a stable base for train builders and their suppliers, who can then top that up with exports. I therefore look forward to hearing from the Minister how we can get the structure right now for delivery in the future.
Graham Leadbitter (Moray West, Nairn and Strathspey) (SNP)
I will not speak for a great deal of time, as this issue is largely devolved in Scotland. However, I welcome the Bill, and the Scottish Government have been keen to support it through a legislative consent motion. That supports the work that has already been done in Scotland. We have put the railway into public ownership as a last resort, but the Bill will provide stability going forward for the Government and the operator and enable them to do much better on medium and long-term planning, with certainty on what the future holds.
My amendment 6 brings into the debate the role of rolling stock leasing companies, or ROSCOs. Many Members on the Government Benches will agree that the ROSCOs are taking a huge profit out of the public sector. Rolling stock contracts in the past couple of years took more than £3 billion each year, and the amount of profit being taken from that is in the billions over the lifetime of the contracts. That money could be reinvested in the railways. I appreciate that it is not for this Bill, but I would like the Government to come forward with proposals on ROSCOs in the next Bill that will come forward later in the Session.
That is all I want to say at the moment. I do not intend to press my amendment to a Division, but I would like some assurance from those on the Government Front Bench that serious consideration will be given to how we deal with ROSCOs and the amount of profit being taken.
Grahame Morris
I start by declaring an interest. I am proud of the fact that I am a trade unionist and have strong links to the transport unions, particularly Unite, the National Union of Rail, Maritime and Transport Workers, and ASLEF. Indeed, as I pointed out on Second Reading, when I was a young fellow many years ago, my first job was on the railways, when they were part of British Rail. In those days, I was a member of the National Union of Railwaymen. More recently, I served on the Transport Committee for almost six years, and I am delighted that many of the arguments and issues that I and many other stakeholders raised in numerous sessions have finally found their way into a Government Bill and on to the Floor of the House of Commons.
Andy McDonald
The privatisation of the railways was a privatisation too far, even for she whose portrait should be removed. Does my hon. Friend agree that it is utterly ridiculous that the only nation state on the planet not able to run the railway in this country is this one?
Grahame Morris
Absolutely. If ever there was a charge of political dogma to be made, it must be about the fact that, under the terms of the privatisation, the British taxpayer and the British Government are not allowed to own a stake in our own railway. For too long, private companies have provided a substandard service while making substantial profits. Over the last seven years, the remaining private train operating companies—I apologise for misleading the Committee, but I misspoke earlier when I said that there were 14 of them; there are 14 franchises in total, four of which are operated by the state through the operator of last resort—have paid out an average of £130 million annually to their shareholders. Those companies are often owned by foreign Governments —in Germany, Italy, France and across Europe and the world. Meanwhile, passengers’ day-to-day experiences have been of overcrowded carriages, delays, service failure and, worst of all, some of the highest fares in Europe.
It is worth thinking about the costs, and the profits that some private train operators have been able to generate for shareholders. Figures released just this week show that Govia Thameslink Railway paid out a staggering £82.4 million in dividends, with £62.3 million of that being for the 2023-24 financial year. That represents a 268% increase from the previous year. In return for those princely profits, Govia consistently failed to meet two thirds of its customer service quality targets, as reported in the Financial Times. The situation was encouraged to persist under the last Conservative Government. I welcome the fact that Labour is making this a priority from day one, as that is fundamental to fixing the foundations and delivering the economic growth promised by the Prime Minister.
I support the comments made by my hon. Friend the Member for Derby North (Catherine Atkinson) and the hon. Member for Moray West, Nairn and Strathspey (Graham Leadbitter) about the rolling stock companies—the so-called ROSCOs. Many commentators see a problem with the newly formed Great British Railways having to continue to lease rolling stock from ROSCOs, as that would allow those companies to profit from taxpayers’ money. My view is that ROSCOs are an unnecessary link in the chain. I frequently raised the issue with experts and industry leaders on the Transport Committee, and I believe that we would benefit from meeting our rolling stock needs by placing orders directly with UK-based manufacturers such as Alstom and Hitachi, rather than enriching the ROSCOs.
Despite being in post for a relatively short time, the Secretary of State has made a strong start with the Bill. However, I urge her to consider the points raised by me and Members on both sides of the Committee about how we continue to procure rolling stock as we move forward. On Second Reading, the Under-Secretary of State for Transport, my hon. Friend the Member for Wakefield and Rothwell (Simon Lightwood), said that purchasing existing rolling stock would not be a responsible use of taxpayers money. I understand that, but will the Minister, in responding, clarify whether in the future, under GBR, there will be an option to purchase new rolling stock directly, instead of having to continue to lease through the ROSCOs?
As my hon. Friend the Member for Derby North said, the UK needs to upgrade to 4,000 units of rolling stock over the coming decades, with Network Rail estimating costs in the tens of billions of pounds, so this is an ideal opportunity to explore a new financing model for rolling stock. I am not naive—I understand the financial situation that we have inherited from the last Government—but I ask the Government to explore not-for-profit financiers if rolling stock cannot be nationalised under GBR. May I point out respectfully that Eurofima, a supranational not-for-profit financier, has stated that, for every £1 billion of financing on UK railways, it could save the taxpayer £350 million over 30 years due to its lower financing costs? That is compared to using the existing ROSCOs. Will the Secretary of State update us on the possibility of using not-for-profit financiers for rolling stock in preference to the ROSCOs?
I will take up the point made by the shadow Secretary of State about the pay review bodies. May I point out that they are not universally welcomed? I have been looking at responses to pay review bodies in the health service, and the last Government had a less than wonderful record when it comes to implementing the recommendations of pay review bodies, not least those relating to junior doctors. The Royal College of Nursing has said of pay review bodies that there is “nothing independent about them.” The chairs and members of pay review bodies are hand-picked by the Prime Minister and Government Ministers, and the terms of reference are decided by the Government. There is some scepticism about how independent they truly are, and about whether, when they make recommendations, the Government are obliged to implement them in full.
I ask the Minister if it is possible to provide a timetable for the next steps. When will future Bills be introduced to the House, and when is Great British Railways expected to be fully established? I acknowledge and express my appreciation for the engagement of the Front-Bench team. I stress that I support the Bill because I believe that it represents a critical step in fixing the long-standing issues in our rail system. The current privatised framework is giving a fragmented railway, and has failed to deliver value for money, an efficient service or customer satisfaction. I am pleased that we are moving towards a model that prioritises the needs of passengers over the profits of shareholders. Rethinking our approach to rail management and financing is a crucial first step towards fixing the foundations and putting Great British Railways at the service of the travelling public.
Siân Berry (Brighton Pavilion) (Green)
The Greens are not agnostic on privatisation. We very much support the principle of the Bill and look forward to its progress. I want to make a short speech on amendments 2 to 5, which I tabled. They are very simple and common sense; their goal is to leave open the opportunity for elected devolved bodies to set up companies that they own, in order to bid to run railway services under the overall guidance and wing of Great British Railways. The Bill, which restricts the definition of a public sector company to those owned by Ministers, either here or in Wales or Scotland, does not allow for that. That seems to clash with the direction of travel towards more public sector devolution, with which my party and I agree.
It would improve and future-proof the Bill if we amended proposed new section 30C of the Railways Act 1993 so that Ministers could in future choose a company set up or owned by combined authorities, or by groups of unitary, county, district or borough councils who decided to co-operate, ahead of further devolution, on improving their railways. Any decisions on the award of franchises, on the suitability of a body to run and own local railways, and on where investment should go would remain fully with Ministers. I tabled the amendments in a constructive spirit, and I hope that they will start a constructive conversation that will continue here and in the other place as the Bill progresses.
The First Deputy Chairman
I call Abtisam Mohamed to make her maiden speech.
Abtisam Mohamed (Sheffield Central) (Lab)
Thank you, Ms Cummins, for giving me the opportunity to speak. It is a real privilege to deliver my maiden speech in this debate on the Bill, which will see the biggest overhaul to transportation in a generation. I congratulate my hon. Friend the Member for Easington (Grahame Morris) on making excellent points about placing passengers at the heart of decisions, rather than unthinkable profits for shareholders.
I deliver my maiden speech with a sense of profound honour and humility. Representing the vibrant and diverse community of Sheffield Central is a responsibility that I do not take lightly. I would like to start by saying a few words about my predecessor, Paul Blomfield. A Labour MP for the last 14 years, Paul turned a majority of 165 to a majority of a whopping 27,000. He achieved this electoral popularity because he made politics accessible and was a great constituency MP. He listened to people and made their concerns his priority. He fought for the people of Sheffield Central tirelessly and consistently. He is everything we should look for in the character of elected Members: humble, honest and extremely hard working. He has received many awards in recognition of that. On a personal level, Paul has been my mentor. His guidance and support during my campaign have been invaluable, and for that I am deeply grateful. If he is watching, I would like to thank him for all the support that he has given me, and for everything that he has done for the people of Sheffield Central.
Sheffield Central is a microcosm of all that is Sheffield and all that is modern Britain. It is characterised by its rich cultural diversity, beautiful green spaces and a thriving independent economic dynamism. From the beautiful Bole hill views to the new Pound’s Park in the city centre, the small independent shops in Sharrow Vale and the up-and-coming Neepsend and Kelham, we have an unwavering sense of community spirit that genuinely makes every area feel like home. That is because it is home to remarkable individuals and organisations that work tirelessly to make our city a better place. It is a place where tradition meets innovation; we have seen the recent excavation and regeneration of a 12th century castle, and have new thriving business hubs, such as Leah’s Yard, which was the place of old toolmakers and is now the city’s new exciting independent home for makers and creatives. Sheffield has earned its stripes as the undisputed start-up capital of the UK. We also have a very large student population. Sheffield Central is home to two brilliant, world-class universities that enrich the fabric of our community. I am fortunate to have been a student at both of these excellent institutions at various points in my life.
With vibrant museums and the largest theatre complex outside London, we are a city that recognises people’s creativity, knowledge, identity, traditions and passions. Our theatres have been home to the world snooker championship since 1977 and, more recently, the multi-award-winning musical, “Standing at the Sky’s Edge”. Sheffield has no desire to copy; we desire to celebrate and embody our uniqueness. We storm ahead in our ability to bring people together, to think, to create and to celebrate.
Wendy Morton (Aldridge-Brownhills) (Con)
It was a real privilege to listen to the hon. Member for Sheffield Central (Abtisam Mohamed). Her passion for the constituency that she has been elected to represent shone through in her speech, and I congratulate her on being the first British Arab woman to be elected to Parliament. I really enjoyed listening to what I would best describe as a picture portrait, in her words, of her constituency. I will reflect on that next time I drive up or down the M1—while also concentrating on my driving, of course.
Let me now turn to the Bill. I rise to support the Opposition amendments, particularly amendments 10, 12, 15 and 17. As others have said, this is a short Bill, but I believe that its aims are radical and ideological. It will completely change our rail system, removing the presumption in favour of private sector operation of passenger services and allowing the Government to bring those operators into public ownership when a franchise ends. In short, I see this move as nationalisation and, indeed, ideologicalisation.
Although the Bill introduces such fundamental change, it is also being rushed through this place with limited scrutiny, for just four hours for Committee consideration. Smaller Bills have sat in Bill Committees for many more sessions. In fact, I think that a private Member’s Bill of mine spent more time in Committee than this. I am disappointed because there seems to be scant regard for what these changes will cost. I am also disappointed because I think the Bill should be considered alongside the railways Bill, which is yet to be published, and from my perspective that makes the scrutiny of the Bill, particularly at this stage, even more important.
I agree that the current model is not working. I am a former Rail Minister, and when we were in government we acknowledged the need to change and made the case for rail reform. However, that reform was about simplification, not nationalisation. It was about bringing the track closer to the trains and putting the passenger first.
Let me begin with amendments 10 and 12. I do not think we should underestimate the need for strict scrutiny, accountability and transparency. At the end of the day, that is what we on the Opposition side of the Chamber are here to provide. Without the additional measures proposed in the amendments, it seems very unclear how the shift from franchise to public ownership will work, and how its impact will be assessed. How will the costs be monitored, and where will investment in future rolling stock come from?
Another problem with the Bill in its current form is the arbitrary transfer of franchises to public ownership, based not on performance but simply on chronological franchise date. I raised that on Second Reading. West Midlands Trains, for example, is one of the better performers, but its contract expires this month. Contrast that with Avanti West Coast. As many Members have probably experienced when travelling to this place, it is currently one of the worst operators, yet its contract expires in 2026.
My reason for supporting the amendments is to ensure that, through stricter reporting and oversight of the new operators, we will see targets that are linked to performance and innovation. It is important that they are also linked to managerial pay, and it is all about keeping the passenger at the heart of what we are doing. It is also important to look closely at how the operator of last resort will manage the many more train services that will fall under its remit. I am not quite sure whether the OLR will have more resource to do that—hence the need to have accounts and monitor what is happening.
It is also important to understand how and where decisions about infrastructure and investment are being made. I will cite the example of the midlands rail hub, which the last Conservative Government committed to. It is absolutely critical to growth and improvements in services, and not just in Birmingham but across the west midlands and other regions. I would like to understand how some of the investments will be progressed under the new model, and how they will be held to account.
Amendment 15 seeks to address the issue of open access operators. Again, I raised this issue at Second Reading and, to be fair, the Rail Minister wrote to me and confirmed that there will remain a role for open access services, alongside publicly owned services. I welcome that, not least because it gives me a reason to continue to bang on about the need for the Government to support the bid for open access for services from Wales to London Euston via Aldridge. However, we need a train station in order for the train to stop in Aldridge, and we want it to be built by 2027 and not pushed into the sidings by the new Labour mayor. So forgive me, Madam Chairman, but I will keep talking about that until we see it delivered, not least because residents are expecting it to happen.
Amendment 15 seeks to carve out the space for open access operators and ensure that there is fairness in the awarding of contracts, which will be critical moving forward. I genuinely believe that there is a place for both the current system of providing train services and open access operators. Generally speaking, a lot of them have proved their value to the passenger and the taxpayer.
I will touch briefly on amendment 17, which is about reforming terms and conditions. I welcome the breakthrough in the pay talks, which is very positive, but it is really disappointing that it has done nothing to address the urgent need for reform of some of the terms and conditions. I see that as being crucial for the future stability of rail passenger services and for having the passenger-focused, seven-days-a-week service that the fare-paying passenger expects. Without the tools to scrutinise the ideologically driven changes, there is a real risk that the Bill fails not just the taxpayer, but fare-paying passengers, as many Members have highlighted this afternoon.
Finally, for constituents to be able to enjoy any benefits of rail travel, they need access to a local station. I will close my remarks by referring to Aldridge, because it is just one of a handful of constituencies that have a track but no train station. I urge the Minister to join me in pushing his colleagues in the Treasury and the West Midlands combined authority to help me deliver a train station for Aldridge on time.
The First Deputy Chairman of Ways and Means (Judith Cummins)
I call Julia Buckley to make her maiden speech.
Julia Buckley (Shrewsbury) (Lab)
Thank you very much, Madam Chair, for allowing me to make my maiden speech. What a privilege it is to follow my hon. Friend the Member for Sheffield Central (Abtisam Mohamed) and her moving story of her family overcoming racism and her personal passion for change.
I am delighted to contribute to this afternoon’s debate on our plans to introduce Great British Railways and bring trains back into public ownership. Nowhere will these benefits be felt more keenly than in my constituency of Shrewsbury, where services are thin on the ground, lacking carriages and frequent and reliable services. Most residents and visitors to Shrewsbury would very quickly conclude that our town is a beauty spot with so much potential but cut off from the wider economic region by a lack of robust public transport. This is mirrored by our inadequate bus services, with over 5,000 routes cut since 2010. Shrewsbury is dreaming of a Sunday service or a bus after 6 pm to support our young people and our night-time economy. Public bus franchises will make a huge impact on so many lives. We also have high hopes for Midlands Connect’s plans to electrify the train route between Shrewsbury and Wolverhampton to boost our capacity.
The First Deputy Chairman of Ways and Means (Judith Cummins)
I call Sorcha Eastwood to make her maiden speech.
Sorcha Eastwood (Lagan Valley) (Alliance)
I congratulate everyone who has made their maiden speech today, and I have to speak from the heart and say that it was incredibly moving to hear the hon. Member for Shrewsbury (Julia Buckley) talk about her friend Jo Cox, who was a former colleague of so many in this House. Jo’s philosophy, that we have more in common than that which divides us, certainly inspired me. We have a lot to learn from that in my part of the world in Northern Ireland.
It is an honour to be here today as the new MP for Lagan Valley. Like many others, I am the first woman MP for my home constituency. I would not be standing here today without the people of Lagan Valley, who have given me the privilege of representing them on Lisburn and Castlereagh council, in the Northern Ireland Assembly and now at Westminster.
I want to take a wee moment to thank Team Lagan Valley Alliance, my colleague David Honeyford MLA and my successor Michelle Guy MLA. I also want briefly to pay tribute to my dear friend and colleague Stephen Farry, who served in this House for five years representing the constituency of North Down. I am delighted that Alliance is continuing the legacy of Stephen’s contributions in this House.
There is a saying back home, “It’s far from here that you were reared,” and it certainly is far from here that I was reared. There was absolutely no expectation that I, as the daughter of Brigid McKeown, who was born on the side of Blaris Road in Lisburn, would wind up as the MP for Lagan Valley. My journey in politics began around our family table. Where I grew up, people did not really take an active interest in politics unless it took an active interest in them. I learned around our family table about public service in housing, education, policing, nursing or whatever it may be—that it was about what we can give back to our community.
My mum used to ask me every Sunday, “Do you want to do a wee general knowledge quiz?” and I would be like, “Yeah, who doesn’t like a quiz?” She used to take me into our back room and say, “Who is the Prime Minister?” and “What’s the capital of Spain?” What I did not really understand was that my mum, who left school with no qualifications and worked damned hard as a domiciliary care worker, wanted her daughter to have a better life, and education was the key to that. No, it was certainly far from here that I was reared, but that makes my presence today even more important.
But this is not about me or my life or my family; this is about the tens of thousands of people across Lagan Valley who grew up the exact same way. In fact, just today, while sitting on these Benches, somebody sent me a wee private message to ask, “Can you help me with this? Oh and here, by the way, it’s good to see that one of us got in there.” They did not mean “one of us” in the Northern Irish sense of the past; they meant somebody who grew up in the same street as them, who had the same social problems and knew what it was like to work a minimum wage job: strong, dignified people; people who want better, voted for change and for the first woman MP for Lagan Valley, but more importantly who voted for the first united community MP for Lagan Valley.
Our job here is to speak truth to power. Frankly, the people of Lagan Valley would not let me away with anything less. The system is broken. The social contract is shattered. It is not working. We have played this tape through to the end. We know how it ends. It so often ends with the most vulnerable in society crushed by a system that is sometimes overwhelmingly stacked against them. The system is harming people. Austerity is a political choice, and not one that my constituents—or frankly anybody in the UK—should be forced to bear.
Nearly 40% of people who are working are in receipt of universal credit. Young people are priced out of the housing market, we are not building enough social or affordable homes and renters are being exploited. We have full-time workers across health, education and hospitality dipping in and out of food banks. When did food banks become normalised? I do not want a single one of us ever to regard food banks as a part of our social architecture. We should be ashamed and disgusted and spending every minute in this place to eradicate their need. People who are working full time and in a households where both are often earning well above the median wage are having to shell that money out again through childcare costs, and many times it is the woman who has to give up her job.
Some politicians need focus groups to tell them what people feel about certain issues, while others create divisive culture wars to distract us from what really matters. But it should be as clear as day that people do not want more of the same. They do not need to be told that it is going to be painful, because they have been in pain for a long, long time. The message needs to be one of hope, ambition, vision and inspiration. From listening to the speeches, not just today but over the past few days and weeks in the House, I know that that is not something we are short of.
People know that underfunded and unfunded promises were made, and nowhere has that been felt more than in Northern Ireland and in my constituency, Lagan Valley. Alliance proudly went out before the election and campaigned primarily on two things—first, reform of the institutions and ending the veto, which so often has led to having no Government for the guts of 10 years where I am from. That is not acceptable. We also campaigned strongly for a fair funding package for Northern Ireland. That is not just a political opinion of mine; the Fiscal Commission for Northern Ireland said that Northern Ireland is not funded based on need. I will certainly be making no bones about fighting for that in this House.
It is one thing to say that we need reform of the institutions and for the UK Government to say that we have won the intellectual argument. Well, guess what? We have also won the argument at the ballot box time and time again. That is not something I will shy away from championing in my time in this House.
I sat around in Ballymacash estate on Friday and talked to people there about a number of things they are doing in that area that are absolutely fantastic. That community has gone on from years of social exclusion and isolation to develop so much. We talked about funding streams, and one we mentioned was the UK shared prosperity fund. They said to me, “That’s your job to go and fight for that.” Do you know what? It is. I met women from Tonagh estate. They rang me and said, “We are desperately worried about our winter fuel payments.” They are not the people with broad shoulders.
People say that politics is personal. It is absolutely personal to me—I make no bones about that. One in two of us will get cancer in our lifetime. I know personally five of my constituents who last year were diagnosed in our accident and emergency department. Just two of those people are alive today, and that is within one year. One of those people diagnosed in A&E was my husband, who has a rare form of blood cancer. Through that time, coping with that diagnosis, we have met hundreds of families right across the UK and Ireland who have been impacted by this. Every second we are in this place, somebody in this country will get a diagnosis of cancer.
The First Deputy Chairman of Ways and Means (Judith Cummins)
I call Paul Waugh to make his maiden speech.
Paul Waugh (Rochdale) (Lab/Co-op)
Thank you, Madam Chair. It is an honour to make my maiden speech during the passage of such a landmark piece of legislation and one that is very much long overdue. It delivers on our promise at the election of real change, and every one of us here is proud to represent it.
It is also an honour to follow my hon. Friends the Members for Sheffield Central (Abtisam Mohamed) and for Shrewsbury (Julia Buckley) and the hon. Member for Lagan Valley (Sorcha Eastwood), who made such moving and powerful speeches. They are a real tribute to this historic 2024 intake. They show up the excellence and diversity of our intake.
In a maiden speech, it is customary to pay tribute to one’s predecessors. I sincerely thank George Galloway for his career of public service. I wish to pay tribute to the late Sir Tony Lloyd, a man who commanded respect across this Chamber and whose decency, internationalism and compassion are an example to each one of us. As Tony once advised his staffer, now my hon. Friend the Member for Blackpool South (Chris Webb):
“If it is not about making people’s lives better, don’t be a politician.
Rochdale certainly has a long history of making people’s lives better and of strong links to this Palace of Westminster. Indeed, it was a Rochdale lass, 15-year-old Emily Kelsall, who, in 1843, laid the foundation stone of the Elizabeth Tower that houses Big Ben. The Kelsalls were close friends of another of my predecessors, the great parliamentarian Richard Cobden and his ally, John Bright, who famously described England as the mother of Parliaments.
Cobden and Bright, one a Rochdalian by adoption and one a Rochdalian by birth, were two Rochdale radicals who campaigned as vigorously against slavery as they did for cheaper food through the abolition of the corn laws and for a wider franchise. Another Rochdalian who was friends with Cobden and Bright was the Lancashire dialect poet Edwin Waugh, after whom my youngest son, Eddie, who is in the Gallery, is named. Waugh captured the beauty of the
“hill and hillock, knoll and dell”,
and the moors and brooks of my Pennine constituency. From Blackstone Edge to Hollingworth lake, from Healey Dell to the landscaped gardens of our magnificent town hall, there is greenery and beauty throughout our town and its villages of Littleborough, Wardle, Milnrow and Newhey.
The Pennine way cuts through my seat, yet our Pennine way is more than just the well-loved footpath; it is a way of doing things, too. Our Pennine way is one of community, co-operation, self-help and resilience. Ever since the Rochdale Pioneers set up shop in 1844 to sell affordable basics like butter, sugar and flour, we have been proud to be the birthplace of a global co-operative moment, and I am proud to be the first Labour and Co-operative MP in our town’s history.
That sense of co-operation and community has been enhanced by the currents of migration that have flowed through our town as steadily as the River Roch itself. Scots, like my own Waugh clan, the Irish, Italians, Ukrainians, Poles, Pakistanis, Kashmiris, Bangladeshis, Nigerians—we even welcome the occasional Yorkshireman —have all staffed our factories and our NHS and created new family businesses. All are proud Rochdalians. Just as our town has shown real resilience in the face of economic downturns and Government cuts, our community cohesion has proved resilient, too—despite the provocations of extremists on all sides.
As well as radicalism and resilience, our town’s story is a story of renewal. Many of our mills have closed, but there is still a strong sense of industry, of hard work, of grafters, of entrepreneurs, of people who put something back into the town that raised them. There are people like Richard Tang, whose Zen Internet started as a small, home-based business, but is now a major network provider and our biggest private sector employer. There are people like Sir Peter Ogden, who founded Computacenter and this year invested millions into my beloved Rochdale AFC—up the Dale—in recognition of its role as a hub of our community.
From the brass bands of Milnrow to the rock and folk music of Feel Good festival, our arts are thriving too. Rochdale sixth-form college is one of the highest achieving in the country. Our armed forces veterans support groups are superb. Springhill hospice is a beacon of excellence, and the Oasis ward at Rochdale infirmary is a national model in dementia care.
My own journey from Rochdale to this place was made possible only by an enabling state: a fantastic teacher, John Williams, who spotted the potential in me and my twin brother, Mark; a council house that gave me the stability and affordability that many families sadly lack today; and free school meals that meant we could focus on learning, not earning. As a former chairman of the Lobby, it would be remiss of me not to also mention the role that my parliamentary journalism has played in propelling me on to these Benches—and I would like to dispel the vicious rumour that the main reason I stood for Parliament was to guarantee five more years of jerk chicken.
The phrase “Westminster village” is often used as an insult, but this place really is a village, in the best sense of the word: a community of more than 3,000 people from all walks of life, making sure that this is an open and accessible people’s House, not the preserve of an elite. For 26 years, I have had the pleasure of working in this building, with its fabulous canteen staff like Betty, Rita, Daphne, Terry and Godfrey, the Doorkeepers like Adrian, the security staff like Saeed, the many Clerks and officials, and of course, the police. I will never forget the day when we lost our own “village policeman”, PC Keith Palmer, in the terror attack of 2017. It has been my pleasure to work with my Lobby colleagues and with MPs of all parties, and I would like to reassure all the Tory leadership contenders: don’t worry, your secrets are safe with me.
Politicians and journalists have more in common than either would like to admit. At their best, both are honourable trades—and they are trades; they are not professions—but the big difference between us is the difference between criticism and action, between commentary and doing. In the end, I could no longer just write about the appalling state of our public services; I wanted to do something about it. I wanted to do something about the NHS workers like my wife, who came home every night exhausted by a sheer lack of staff. I wanted to do something about all those working-class kids like me whose destinies are still too often determined by their postcode, not by their potential.
I also wanted to do something about this misinformation age that we live in, and to combat the rise of extremism that disfigures too much of our discourse. It was Stanley Baldwin who denounced the newspaper barons for wanting power without responsibility; today, too many social media companies have exactly that. This summer’s spread of online hate and falsehood is a challenge to which this Government will have to rise, just as they rose to the challenge of cracking down on the thugs who attacked our communities and our brave police officers. Tackling online publishers—that is what they are: publishers, not platforms—may sound radical, but in reality radicalism is often just common sense ahead of its time, a reminder that all our rights are hard won. What could be more commonsensical than demanding that the vote be given to the working classes and to women, more than 100 years ago? What could be more commonsensical than this railways Bill, giving the public control over the services that spend billions of pounds of their own money? What could be more commonsensical than tackling climate change or giving towns like Rochdale more control over their own future—towns that do not want a handout, but deserve a fairer share of the national resource?
The Pennines are famously the backbone of England, but the people of Rochdale are the backbone of England too. Common-sense radicalism, resilience and renewal—those are the watchwords of my home town, of this country and of this Government, and I will do my utmost to live up to them.
The First Deputy Chairman of Ways and Means (Judith Cummins)
I call Charlie Dewhirst to make his maiden speech.
Charlie Dewhirst (Bridlington and The Wolds) (Con)
Thank you, Madam Chair, for allowing me to catch your eye during this very important debate. I congratulate the hon. Member for Rochdale (Paul Waugh) on a really excellent maiden speech, and I hope that I can match the very high bar that has been set by hon. Members in all parts of the House so far today.
I start by paying tribute to my predecessor, Sir Greg Knight. I am very fortunate to be following him; he was a very well-liked and respected Member of this House. His parliamentary career spanned five decades, and he served as a Minister in the Governments of Thatcher, Major and Cameron. He was first the Member for Derby North, from 1983 to 1997, and excelled in the roles of deputy Chief Whip and Minister for Industry. He then returned to this place in 2001 for the then constituency of East Yorkshire, which has now become Bridlington and The Wolds, and was re-elected on five separate occasions until his retirement this year.
Sir Greg served for a second stint in the Whips Office during the coalition years and worked tirelessly behind the scenes on many of Parliament’s less fashionable Committees. I will always aspire to match his dedication and integrity in public life, but there is one area in which I will never be able to compete with him—that is, of course, the election campaign jingle. For any hon. Members who are unaware of his unique impact in this area, I wholeheartedly recommend a quick internet search after today’s debate. More seriously, Sir Greg was rightly rewarded with a knighthood for his service to this place, and I place on record my thanks for his support and friendship in recent months. I wish both him and Lady Janet a very happy and well-deserved retirement.
I now have the unbelievable privilege of representing my home constituency of Bridlington and The Wolds, and it is truly the greatest honour of my life. I am sure you will agree, Madam Chair, that there is no finer county than Yorkshire, and nowhere showcases it better than the East Riding—from the stunning cliffs and world-famous seabird colony at Bempton and Flamborough Head to the golden, sandy beaches stretching from Bridlington to Hornsea and the rolling hills and picture-book villages of the Wolds.
Each of the four towns in the constituency has its own unique appeal. Bridlington is the largest shellfish landing port in the UK and the lobster capital of Europe. It attracts millions of visitors every year and is home to many thousands of people who have retired to the area, and I will always fiercely defend our local pensioners. Driffield, my home town, is the capital of the Wolds—or capital of the world, as I thought it said on the road sign as a child—and home to one of the largest one-day agricultural shows in the country. Hornsea boasts not only a beautiful coastline but the largest freshwater lake in Yorkshire, and Market Weighton was once home to William Bradley, who is believed to be the tallest person ever to have lived in this country at 7 foot 9 inches tall, and to whom the town pays tribute every year on Giant Bradley Day. I do not wish to test your patience, Madam Chair, by singing the praises of all the many villages and hamlets across my constituency, but it would be remiss of me not to mention Nafferton, where I grew up, and Wansford, where I now live. Both are home to excellent local pubs; if you do find yourself in the area, I would be delighted to buy you a drink.
I hope to repay the faith placed in me by the electorate with hard work and diligence. I want to improve access to local health services, increase transport links, ensure access to high-speed broadband for all and address the historical funding formula in education that disadvantages children in rural local authority areas. I am one of the few Members who can claim to represent more pigs than people. Agriculture, fishing and tourism are the foundations of our local economy. If I can make our beautiful corner of Yorkshire a better place to live and work before I depart this place, I will, I hope, have done some good.
Paul Davies (Colne Valley) (Lab)
I express my gratitude to you, Ms Cummins, for the chance to address the House for the first time. I congratulate all hon. Members who have delivered their maiden speech in recent days. Their eloquence serves as testament to the remarkable talent in this House, and I am honoured to be counted among them. I eagerly anticipate their contributions to future debates in the years ahead. I also pay tribute to my immediate predecessor, Jason McCartney, who has demonstrated over the past four and a half years a real passion for improving the lives of many people in the constituency.
Today, we discuss the Passenger Railway Services (Public Ownership) Bill. For my constituents, the change cannot come soon enough. The Bill will be a cornerstone, kick-starting economic growth, unlocking opportunities across the country—especially in Colne Valley—and accelerating us towards net zero.
We are all shaped in many ways by our upbringing. My commitment to community was deeply influenced by growing up in south Wales. My parents quietly volunteered to drive stroke survivors to the aptly named stroke club, which provided essential respite. For them, it was not charity; it was just something you did. Working in the mines taught me the value of collective support. Miners watched out for each other; their safety depended on it. That sense of community cohesion contributed to proud and resilient communities that shaped our nation’s success. We must reignite those bonds through community wealth-building initiatives, and by retaining wealth in local communities. That transformation, inspired by the co-operative movement, is pivotal. Born in Wales and shaped by the Labour movement, I found purpose through education and global experiences during my professional career. Now, just a few years later, I stand before the Committee as the newly elected Member for Colne Valley. It is an immense honour, and I am genuinely humbled that the people of Colne Valley and Lindley have placed their trust in me.
The Colne Valley constituency embodies the community values instilled in me during my Welsh upbringing, values that are evident in its vibrant villages and urban centres—Meltham, Lindley, Linthwaite, Slaithwaite, Marsden, Golcar, Honley and Holmfirth—where community ecosystems thrive and people look out for each other through various community groups. There are festivals and shows, such as the Holmfirth arts festival, the Honley show, Lindley street festival, Marsden jazz festival and Golcar lily day, and everybody is welcome to contribute, participate, or simply enjoy themselves. There are sports clubs, such as Honley cricket club, Wooldale Wanderers football club and Holmfirth bowling club, that are woven into the fabric of our constituency. Of course, there are the local businesses that serve and employ our community members, including the Picturedrome in Holmfirth, Coopers Yard, Beauty and the Barista, Read, Trojan plastics, and many others. We should not forget the community support groups, such as Crossroads in Meltham and the Holmfirth food bank.
Much of the above only came about due to individual sacrifices and an unwavering belief in our communities. Developing a strong community spirit is an ongoing effort. It is not something that you simply bottle. It is a living, often delicate entity that requires nurturing and protection. External support is crucial to put in place the foundational elements. For example, we need to empower people through safe, secure, affordable homes and decent jobs. Those foundations allow individuals to contribute more broadly to their communities. In Colne Valley and Lindley, a palpable community spirit thrives—a spirit you can almost touch. That vitality is evident through numerous community groups, from EcoHolmes, which focuses on building affordable homes, to Holmfirth Tech, which provides community spaces, as well as the Full Life food bank and various faith-based organisations. That is why, 15 years ago, Leah and our two daughters chose to make this area our home. It is why, every single day, we appreciate how lucky we are to live in such an amazing place with such amazing people. Of course, I have to mention the excellent beer, which does help.
However, as I suggested earlier, focusing beyond our immediate needs can be challenging when we are tired, lonely, hungry, distracted, or simply busy. Too many of our people are in that position; they find it impossible to get off the treadmill of looking to make ends meet. As the Member for Colne Valley, I aspire to be a voice for those who struggle to be heard amid the pressures of the cost of living challenges they face. I aim to be a calm, consistent advocate for all, emphasising the strength that comes from unity, and a voice that celebrates the selflessness of those whose altruism forms the bedrock of a healthy society. However, I also recognise the importance of being a strong, resilient voice, one that calls for better and more effective ways of building and retaining wealth in our communities to benefit everyone. My values stem from the collective, and my unwavering commitment lies with my community. Those are the values and principles I will carry with me every day as I go to work in this place for the people of Colne Valley.
Calum Miller (Bicester and Woodstock) (LD)
It is an honour to be called to give my maiden speech, Ms Cummins. I start by thanking the hon. Member for Colne Valley (Paul Davies) for his speech. He spoke about a spirit in his community that you could touch; he has a pride in his community that we can feel, and can almost touch as well. He spoke about the selflessness of service to the community, a point echoed in excellent speeches given today by the hon. Members for Sheffield Central (Abtisam Mohamed), for Shrewsbury (Julia Buckley), for Lagan Valley (Sorcha Eastwood), for Rochdale (Paul Waugh), and for Bridlington and The Wolds (Charlie Dewhirst). It is my honour to speak in their company.
Convention requires that I say a few words about my predecessor, and I have been advised that, despite political differences, these should be complimentary and civil. I have tried, but the best that I can say is that the views of the last MP for Woodstock belong to a different time—which is quite understandable, since Lord Randolph Churchill held it until the parliamentary borough of Woodstock was abolished in 1885. For over a century, Woodstock disappeared from the constituency names in this House. Meanwhile, the town of Bicester has never previously been named in a constituency. Bicester and Woodstock is a fusion of four previous constituencies. I therefore have no immediate predecessor to refer to, but I want to thank Robert Courts, John Howell, my hon. Friend the Member for Oxford West and Abingdon (Layla Moran) and Victoria Prentis for their service to the communities in my constituency. Like any new Member, I am eager to learn from how others have done things, so I am grateful to have such a diversity of approaches to draw on.
I was fortunate to be called on to ask a question in the first Prime Minister’s Question Time of this Parliament. I spoke then about the River Evenlode, but I could equally have referred to the Rivers Cherwell, Dorn, Glyme or Ray. Each cuts a path through my constituency and each has to carry its unfair share of pollutants from Thames Water’s sewage spills. Tackling the pollution of our rivers and waterways was a common concern among my constituents during the election campaign, and I welcome the Prime Minister’s undertaking to work across parties to address this scandal.
Alongside our waterways, the railways are significant features of my constituency. We have no fewer than seven stations. To address the subject of this afternoon’s debate, at each you will find passengers keen to see improvements. The travellers through Bicester North bemoan the age of the rolling stock, which breaks down far too often, and the shortened trains with their inadequate seating. Constituents near Bicester Village are deeply concerned about the future closure of the London Road level crossing, which would cut off those living in south-east Bicester from the rest of the town. I hope the Rail Minister, to whom I have written, will respond positively to my request to ensure that East West Rail brings forward sufficient funding for alternative crossings for all users.
Another feature of my constituency is the rapid proposed growth of towns and villages, under plans adopted by the last Government and supported by Conservative local councils in 2017. Bicester has already seen tremendous growth. A similar scale of development is planned for Eynsham and the wider Kidlington area, including Begbrooke and Yarnton. As this Government prepare for an increase in housing provision, the lessons from areas like those in my constituency must be learned.
My constituents understand the need for more homes for local residents, and especially for those who cannot access social housing, but they want to know that sufficient infrastructure will accompany new homes. I am talking about not just improvements to the hard engineering for travel, grid connections, sewage and other utilities, but also the social infrastructure of schools, GP surgeries, dispensing chemists and NHS dentists, as well as community, youth and sports centres. We must make sure that these services are funded and delivered before new homes are released.
I have lived in the constituency for over 12 years, and my wife and I have raised our four children there. They attend local schools and are active in local sports clubs. Long before I ran for this election, they ensured that I knew the future constituency well by dragging me to most of the sports grounds and sports halls that it contains. I owe my place to the many voters who put me here, but I would not be here without the steadfast support of my family, and I am so pleased that they are here today. For some, that support has come with encouragement; for others, it comes with occasional embarrassment about my endeavours. But from all, it has come with love, affection, and a willingness to keep me grounded through the occasional well-deserved put-down. I am truly grateful to them and hope that they know how much I appreciate their support.
My constituency contains a vibrant mix of communities beyond its two towns. Famously, Kidlington contends to be the largest village in England, with its population of over 13,000. When the parish council suggested in 1987 that it was a town, irate residents forced it to back down and reinstate village status. That does not, however, explain why groups of Chinese Harry Potter fans were spotted taking photos outside suburban homes in the village in 2016. Despite extensive searches, I never found the Dursleys of Privet Drive on the electoral roll.
One of the greatest pleasures of representing this area is travelling across its stunning countryside and discovering the passion for history, environment and community that burns in each town and village. I cannot do justice to that diversity today, but I say thank you to the thousands of constituents who contribute to their communities as town and parish councillors, school governors, village fête organisers, wildlife champions, Royal British Legion fundraisers, youth sports coaches, or food bank collectors, and in many other roles besides. Every week, as I visit organisations in the constituency, I am inspired by the selfless actions of those who put community first and build stronger relationships, one freely given hour at a time.
It is that sense of community and of what we can do for each other that brought me here today. From volunteering as a school governor, I came to see how both the setting and implementation of national policy had deep local impacts. I became a county councillor in 2021 and saw up close how local government has been hollowed out by national funding decisions that respected neither the role that local authorities play in delivering critical services, nor the unique insights they hold at local level about the needs of their residents. Those experiences put me on the path towards standing for election, and it is a huge honour now to be a Member of this House. I hope that during my time here I can serve my community with the same selflessness and energy shown by so many of my constituents.
The First Deputy Chairman of Ways and Means (Judith Cummins)
I call Graeme Downie to make his maiden speech.
Graeme Downie (Dunfermline and Dollar) (Lab)
Thank you, Madam Chair. I am delighted to make my maiden speech today as the first MP for the new constituency of Dunfermline and Dollar. It is a privilege to follow the hon. Member for Bicester and Woodstock (Calum Miller), and I would like to congratulate all MPs who have made such fantastic and powerful maiden speeches this afternoon. With such a high turnover of MPs, the calibre of the speeches I have heard since the election should give everyone a sense of optimism about the future and what this Parliament can achieve.
I believe I must start my speech with a particular tribute, and so I shall. They are known for being colourful and preening, strutting around like they own the place, and expecting to be waited on hand and foot by a fantastic team of underpaid and overworked staff. They demand honours, and they disappear without permission whenever the mood takes them. In the past century, their names have included Andrew, Malcolm and Angus, and I am even told that some individuals have been found in bushes in a horrible state. No, these are not my honourable predecessors. They are not even Members of the other place. Instead, they are the names of just some of the peacocks that reside in the beautiful surroundings of the Pittencrieff Park in Dunfermline, and that only last week were awarded the freedom of the city.
I am sure that my immediate predecessors for the seats that now make up the constituency of Dunfermline and Dollar will not object to being upstaged by the peacocks, but I would like to place on record my thanks to both Douglas Chapman, the Member for Dunfermline and West Fife from 2015 until retiring prior to the election, and John Nicolson, the Member for Ochil and South Perthshire. Douglas and John worked hard on behalf of their constituents in the best and truest tradition of public service, and I wish them well.
I would also like to thank my immediate predecessor from the Labour party, Thomas Docherty. Thomas is still known by many in this House, and we should remain grateful to him for first proposing the idea of recalling MPs, although I suspect that gratitude is perhaps felt by me and some of my colleagues rather than by some of the Members opposite.
My “Aww, Dad” sense of humour is something I was accused of having long before I had children, and where better than a debate on railways to put some of that reputation to the test. So I will steam ahead with my remarks and do my utmost to stay on track, hoping to reach my destination on time and not come up against the buffers of your patience, Madam Chair.
I have never served in the armed forces, but I was raised in a family that did. Much of the sense of public service that I hope to bring to my contribution to this House is rooted in the values of the members of my family who have done so. My grandma, Margaret Delworth, was a plotter for the RAF during the battle of Britain, with the air raid sirens next to her playing a part in the deafness she suffered later in life. My grandpa served in the Royal Signals in campaigns in north Africa, Italy, including at Monte Cassino, and later with the UN in Korea. My parents, Jim and Cathy, were both members of the Royal Observer Corps—indeed, that was where they met—and I am very proud that they are in the Public Gallery today.
When I was six, my parents took what I now realise must have been an incredibly brave decision: to move our family to Berlin, where we lived on RAF Gatow for three and a half years. Many of my early memories are from there, and it has shaped the rest of my life: I played football with FC Westend, a German club based nearby; the death of Rudolf Hess was historic but meant I got a day off school; and the defection of a Soviet general saw my sister locked in the cellar of an air traffic control tower for hours—Helen has always been a very supportive older sister, but I would be lying if I said that there have not been times when I wished she had been left there just a little longer.
But it was an early November morning in 1989 that truly shaped my politics. I was woken at 2 am by my dad, who sat me down in front of a German TV channel and proclaimed, “This is history.” I watched as tens of thousands of people scaled the Berlin wall, heralding the beginning of the end of the cold war and moves towards a united Germany. The events of 1989 taught me that oppression is not, cannot and never will be either acceptable or effective, and neither should it be tolerated.
I want to take this opportunity to add to the sentiment across this House that the UK will stand with Ukraine for as long as it takes to fight the aggression of Vladimir Putin. He might hold the honorific of “president”, but a dictator is a dictator, as many before have warned from these Benches.
It is that history—that privilege of observing good triumphing—that makes me immensely proud to be serving the constituency of Dunfermline and Dollar. The area has a proud military history and, with the Royal Navy base HMS Caledonia, that continues to this day. The firth of Forth was a regular home to the grand fleet, and throughout the 20th and 21st centuries the ships and sailors that protected us then and continue today have called that part of west Fife their home.
This allows me to mention Rachel Squire, who some might remember was the Member of Parliament for Dunfermline and West Fife before her sad death in 2006. She led the successful battle to save the dockyard at Rosyth, which remains a vital and major asset to the local economy and our community. I visited the dockyard just last week to see the progress on the construction of the first two Type 31 frigates and was impressed by the talented and dedicated workforce who build and maintain the warships that keep our country safe. As the world continues to look to Britain for leadership and security, we must never forget the communities and workers who are the backbone of a deterrent and strength that so many depend on.
I am afraid I will now return to the bad puns as we ride the rails again from Rosyth to Dunfermline, Scotland’s ancient capital. Close to Pittencrieff Park and the preening peacocks we find Dunfermline abbey, the resting place of Scotland’s king and queens, including Robert the Bruce, and the birthplace of Charles I. Close by is the birthplace of Andrew Carnegie, the great Scottish businessman and philanthropist, who valued and promoted industry, innovation and education with a global view of Scotland and the UK. His legacy of libraries and education is strongly felt in Dunfermline and around the world, and nowhere more so than in the United States, in institutions such as Carnegie Mellon University in Pittsburgh. However, a local historian told me that after Andrew’s death his widow employed a certain Mary Anne MacLeod as a domestic servant in her home in New York—answers on a red baseball cap for why I might not want to dwell on that connection too much.
As I continue my journey, poor rural transport sadly means that a replacement bus service is required as I take us to Dollar, a beautiful village at the foot of the Ochil hills. I held an excellent surgery there this weekend and I am very tempted to return this weekend for the village’s annual beer festival—I note that beer has been a theme in many of the maiden speeches we have heard since the election. Dollar is most famous for Dollar academy, and despite cordial disagreements over certain aspects of the Labour party manifesto, I am very grateful for the excellent work it does with the local community and schools in the area to share its learning and experience.
Travelling back towards Dunfermline, we will find the railway tracks once again. These tracks transported coal from the mines in nearby villages such as Oakley, Comrie, Valleyfield, Saline and Steelend, and were more recently used by the former Longannet coal power station near Kincardine. As the Member for a constituency with a proud history of mining, I was delighted to stand on a manifesto that will end the injustice of the mineworkers’ pension scheme.
At this point, I will mention just one more of my predecessors, Gordon Brown, who was elected as the Member for Dunfermline East in 1983. In preparing my speech today, I read his incredible first contribution to this House. I urge others to do the same, as it was a powerful speech focused on the need to tackle unemployment. With this new Labour Government investing in green jobs, manufacturing and infrastructure, we will have the opportunity to make the constituency of Dunfermline and Dollar and sites such as Longannet drivers of the Fife, Scottish and UK economies once again, tackling unemployment by establishing new industries and expertise that will help the global fight against climate change.
I began this speech by talking about the contribution of family and my optimism for the future, and I will begin winding up in the same vein. First, I want to take a moment to thank my wife, Jen. It is very simple: without her love and support, I would not be standing here today. We have heard about the importance of family in maiden speeches from Members from all parts of the House. All Members of this House will be aiming to make even the smallest contribution to creating a better community, a better country and a better world for our own families and future generations. I want my two daughters, Hannah and Eilidh, and all children, regardless of where and how they started their life, to be able to grow up in a world where the opportunity exists for their own aspirations and ambitions to be met, nurtured, supported and fulfilled. That is something we have heard powerfully in speeches this afternoon. As the Dunfermline-born author Iain Banks wrote,
“the future remains malleable and retains the possibility of change”.
Those are wise words that I will try to remember as I work across the House to create that better future.
The First Deputy Chairman of Ways and Means (Judith Cummins)
I call Rebecca Smith to make her maiden speech.
Rebecca Smith (South West Devon) (Con)
It is a pleasure to follow the maiden speech of the hon. Member for Dunfermline and Dollar (Graeme Downie). I was especially interested in his recollections of the fall of the Berlin wall in 1989, which is also one of my early political memories, although I am obviously on the other side of the House as a result. I was interested in his reference to Monte Cassino, which might make sense later on in my speech.
I am incredibly grateful to the people of South West Devon, who put their trust in me on 4 July, electing me to serve them here in Parliament. Starting out in this place just a few short weeks ago, it was almost a quarter of a century to the day since I first set foot in Parliament. Forgive the cliché, but if someone had told the 18-year-old me, who was spending a week’s work experience with the MP for South West Devon, Sir Gary Streeter, that one day I would follow in his actual footsteps, I would not have believed them. Everybody I have met since entering this place who knew my predecessor tells me that I have big shoes to fill. For some, that might seem daunting. After all, he is a size 10 and I am a mere size 4. However, knowing Sir Gary as I do—in fact, having known him since we first met at a Kylie Minogue concert in 1991, where we both enjoyed her rendition of “The Loco-Motion”—I am honoured to follow in his footsteps and the legacy he has left.
After 32 years as a Member of Parliament, Sir Gary’s legacy is one of kindness, integrity and a deep commitment to the people of South West Devon. I know that there are Members on both sides of the House, past and present, who appreciated his wisdom over the years. It is something that he will tell you comes from his deep Christian faith. I am grateful that I still have access to that wisdom, given that he is now one of my constituents and that I also share his faith.
Unsurprisingly, although Sir Gary achieved a huge amount for our constituents, there are issues affecting South West Devon today; long-term battles that he fought and that remain in need of a victory. One such issue relates to our Great Western Railway line through Devon. Today’s debate therefore provides the perfect opportunity to commit myself to the fight for a better railway service to the far reaches of Devon and the south-west.
Following the devastating floods at Dawlish in 2014, the previous Government did much to safeguard the line through Devon. The sight of a railway track suspended in mid-air with nothing between it and the sea is not easily forgotten. I will therefore be campaigning cross-party alongside colleagues to see the new Government commit to completing the remedial works at Dawlish. They must also ensure that forthcoming HS2 works at Old Oak Common in London do not hamper the progress made on our journey times between London and the south-west. The main line through Devon does not just take holidaymakers to our beautiful counties; it is vital for those who live and work there too.
The west side of Plymouth is served effectively by several small stations, but to the east, in my constituency, there are very few options for train travel between Plymouth and Totnes, some 30 minutes away. Indeed, the current level of service makes a mockery of the existing “Park and ride by train” that is advertised as people drive down the A38. I will therefore continue to fight for CrossCountry trains—not just Great Western Railway services—to call at Ivybridge station. As the population of that town and of nearby Sherford grows, having adequate access to mainline train services closer than Plymouth, Totnes—or, in some cases, Tiverton Parkway—is essential.
To see the full economic benefits of the Plymouth and south Devon freeport, with its key sites at Langage and Sherford, we must see the delivery of a metro railway linking Plymouth with Tavistock and Ivybridge, including a stop in Plympton. That would also enhance connectivity for the Dartmoor villages, which are now a welcome part of South West Devon following the recent parliamentary boundary changes. The previous Government’s plan to reopen the line between Plymouth and Tavistock is critical to delivering that metro service. I therefore call on the new Government to push forward with that proposal and enable us to get the metro scheme off the ground.
Jen Craft (Thurrock) (Lab)
Thank you, Madam Chair. It is the honour of my life to address this House as the Member of Parliament for Thurrock, my home, and to speak in this important debate on the future of our railways. I congratulate the hon. Member for South West Devon (Rebecca Smith) on her passionate speech, which was infused with pride for the community she serves and a strong commitment to her new role, particularly to help the people of Dawlish to rebuild after the flooding and to speak up for those who have experienced the care system. I also congratulate my hon. Friend the Member for Dunfermline and Dollar (Graeme Downie) on such a brilliant speech, which was infused with peacocks and train puns, which I will not try to outdo. I will steam ahead, get back on track and diesel-power on with the main body of my speech!
I would like to begin by talking a little about my predecessor, Jackie Doyle-Price. Although our politics are different, she served our community for 14 years and was a vocal campaigner against violence towards women and girls, both in this country and internationally. She highlighted the role that rape and sexual violence play as a weapon of war, and the lifelong impact that these appalling crimes have on women and girls here in the UK. She was a strong supporter of SERICC, the groundbreaking rape and abuse service based in my constituency, which found her a listening ear and a vocal advocate for its work. I will ensure that I will carry on that relationship and continue that work.
I would also like to thank the former Member of Parliament for Barking, Margaret Hodge, who gave me my first job in politics and taught a newly graduated, idealistic young woman that politics is more often than not about who gets the potholes filled, the grass verges cut and people’s individual problems solved than the big issues of the day. Moreover, she taught me that being a visible, vocal advocate for one’s constituents is the fundamental job of being an MP. In doing so, she defeated the extremists of the British National party by demonstrating that politics can be a force for good—work that I was extremely proud to play a part in at the time, and something that I will continue to take forward, to counter the threats from extremism and populism that our communities face today. She has also shown kindness and support as I, like many others who are new in this House, struggle to navigate the early days of this unique role.
It is an incredible privilege to have the honour of representing my home in this place. Thurrock has had representation from across this House since its creation in 1945, but this is the first time that someone born there has addressed the House as its Member of Parliament. I am that much unfairly maligned of creatures—a true Essex girl. I prefer Dr. Martens to white stilettos, but I am extremely proud of the county of my birth and the history of our community and the people who live there.
Thurrock has a fighting spirit, having played an important role in the decoy operations prior to the Normandy landings in the second world war. It provided a muster and departure point for those leaving to take part in the D-day operations. Several hundred years earlier, Tilbury is where Queen Elizabeth I rallied her troops before fighting the Spanish armada, famously declaring:
“I know I have the body of a weak and feeble woman; but I have the heart and stomach of a king, and of a king of England too”.
The Empire Windrush landed at Tilbury docks in 1948, bringing those who answered the call to help restore and rebuild our country after the second world war. A permanent exhibition, “Tilbury bridge walkway of memories”, is a moving testimony to those who came. Unfortunately, it is currently closed as a side effect of the Tilbury to Gravesend ferry ceasing to operate for the first time in nearly 600 years, something my hon. Friend the Member for Gravesham (Dr Sullivan) and I are determined to rectify.
Further down the river, we can find the Purfleet heritage centre which, among its extensive collection of local military memorabilia, also hosts an exhibition honouring the contribution of the Gurkha regiments to our armed forces, reflecting the significant Gurkha and Nepalese community who have chosen to make Thurrock their home. The museum is well worth a visit, although I would take with a pinch of salt anything one of the volunteer guides says about the etymology of Purfleet and its deriving from an exclamation of Elizabeth I, “My poor fleet”.
The towns of Tilbury and Purfleet are just two of the many that make up Thurrock. Aveley, Ockendon, Stifford Clays and Chafford Hundred all have their stories to tell. One reason I am so pleased to be making my maiden speech today as part of the debate on the Passenger Railway Services (Public Ownership) Bill is that one of the uniting factors of all of these towns is the role they play as key commuter locations for jobs in the City of London and the docklands—journeys that are primarily made using the rail network. The public ownership of our railways, delivering a better service and better value for taxpayers’ money, will make a daily difference to the lives of many of my constituents, and, indeed, to many of my friends and family.
I would not be here without the support of many people, but in particular my family: my children, my mum and dad, my husband Ali—a stronger or kinder partner you would struggle to find—and my in-laws Mike and Sue. It really does take a village.
I would like to share my own personal story about my motivation for being here, beyond the love of my community and my desire to serve. Almost seven years ago, I found out that the baby I was carrying had Down’s syndrome—a rug-pulling, life-altering moment which I did not realise, but wish I had, would be the making of my family and the start of a truly incredible journey. As the actress Sally Phillips says, the special educational needs and disabilities parent club is the one no one wants to be in, but once you are there you realise that all the best people are there. However, the world does not work for families like mine. It does not work for children like mine, and it does not work for people like me and my daughter. When I received her diagnosis, I made her a promise that I would do everything I could to make her life easier. Little did I realise that it would lead me here.
I am here to serve my community, to speak up for the home that I love and the people who live there. If by being here I can make a difference to the lives of children and families such as mine, I will consider it a job well done, however long my constituents may opt to keep me.
Olly Glover (Didcot and Wantage) (LD)
I speak in support of amendment 20, tabled by my hon. Friend the Member for Bath (Wera Hobhouse), which would create an independent body to ensure that scrutiny and transparency are at the heart of the public service train operating contracts the Government propose to award. With the end of competitive tendering of franchise contracts, which historically, despite their flaws, have contributed to some improvements to cost control and passenger growth, it will at least ensure that quality and accountability are present in the process, and will be important. I welcome the Government’s desire to improve our railways, but it is important that there is accountability and to remember that public ownership and direction have historically caused problems as well as improvements. Although the majority of current train operating contracts are in the private sector, since the pandemic they have been subject to even more significant direction and sometimes micromanagement by the Government than before.
My journey into London today shows how the public versus private debate is not all that is needed to improve our railway. At Didcot Parkway this morning, only one out of three ticket offices was working and two out of four ticket windows were closed. That led me to miss train number one as a result of private sector problems, and I was prevented from catching the next couple of trains as a result of public sector problems, namely Network Rail signalling problems. Again, the ideology is less important than the delivery.
Wera Hobhouse
I agree with everything that my hon. Friend is saying, and I thank him for giving way. I just wanted to congratulate the hon. Member for Thurrock (Jen Craft) on her maiden speech. We should not forget that there are so many new Members. It was such a wonderful speech, and I wish the hon. Lady, and her daughter, all the best on her journey. I am sure that my hon. Friend will want to mention her speech at the end of his own.
Olly Glover
My hon. Friend is absolutely correct, and I am sorry I omitted to do that earlier. The passion expressed by the hon. Member for Thurrock and her tribute to her constituency were very clear, and it was touching and moving to hear about her child and her family. I know that she will be a great champion for special educational needs and disabilities provision.
Let me end by saying that I hope the Government will extend their passion for public ownership to the investment in rail infrastructure that we in Oxfordshire need, and from which, as many other Members have said, the rest of the country will benefit.
Jonathan Hinder (Pendle and Clitheroe) (Lab)
I congratulate my hon. Friend the Member for Thurrock (Jen Craft) on her maiden speech. I am not sure I can compete with one that ranged from Essex girls to Elizabeth I, but I will do my best.
It is an incredible honour to stand here today as the newly elected Member of Parliament for Pendle and Clitheroe, where I grew up; the place that made me. As the Member for a significantly redrawn constituency, I want to begin by paying tribute to both my predecessors, Andrew Stephenson on the Pendle side and Nigel Evans on the Clitheroe side. Andrew Stephenson, most recently a Health Minister following a number of other Government roles, was a widely respected constituency MP who worked hard for Pendle for 14 years. Nigel Evans was a parliamentarian for 32 years who loved working in this place. He served as its Deputy Speaker in two spells, and brought great distinction to his role. I wish them both well for the future.
I also want to pay tribute to two of my Labour predecessors, Gordon Prentice and Sydney Silverman. Gordon was the Labour MP for Pendle from 1992 to 2010; he was a principled, independent-minded MP, whose work on “right to roam” legislation improved access to our countryside for all. Sydney Silverman, MP for the predecessor seat of Nelson and Colne for 33 years, stands as a true giant of parliamentary history for his leadership in the campaign to abolish capital punishment. It is an honour to follow in the footsteps of two men who fought so passionately for justice and human dignity.
Pendle and Clitheroe is an area that has a rich history, stunning natural beauty, and a strong sense of community spirit. From Barnoldswick, Barrowford, Clitheroe, Colne, Earby, Nelson, and Whalley to our villages that stretch to the edges of the Ribble Valley, the Pennines and the Yorkshire Dales, every part of the constituency has its own unique identity. At its centre stands Pendle Hill, a landmark that unites us, dominating the landscape on both sides of this new constituency. Pendle Hill is not just famous for its witch trials, though they often steal the spotlight. It has also been a source of inspiration for radicals and non-conformists who have left their mark on history. It was on Pendle Hill that George Fox experienced the vision that led to the founding of the Quakers.
We can also claim Katharine Bruce Glasier, a formidable Christian socialist and founding member of the Independent Labour party, who lived in Earby and championed the rights of working people. Then there is Selina Cooper, a hero of the suffrage movement, who emerged from working in the mills from the age of 12 to lead the charge for women’s rights.
Pendle was a powerhouse of the industrial revolution, driven by its iconic cotton mills, and the same grit and ingenuity that saw our mills thrive continues today in world-class engineering firms such as Hope Technology. Its track bikes, designed and manufactured in Barnoldswick, were ridden by Team GB to break a world record three times and secure a gold medal at this year’s Olympic games.
But while we celebrate our past and present achievements, we must face the challenges of today. Pendle has the highest rate of child poverty in the entire country, so I will be focused on the material needs of ordinary people in my constituency: reducing the cost of living, rebuilding our public services, revitalising our high streets and supporting our local businesses to create good, meaningful jobs. I will champion our local farmers so that we can boost food security and sustain the rural economy that forms an important part of my constituency.
I want to touch on my background as a former police inspector. We saw the best of British policing just a few weeks ago. In the face of violent disorder aimed directly at them, our officers showed great courage, professionalism and restraint. They worked long, hot shifts in full riot gear—many on their cancelled days off—with thousands of other officers redeployed at a moment’s notice to plug the gaps in day-to-day policing. I want to express my deepest gratitude to Lancashire police, and to thousands of my former colleagues nationwide, for their service to our country. Where others seem intent on undermining our police, I look forward to being an outspoken advocate for policing in Parliament.
The demands on policing have grown dramatically in recent decades, with increased reporting of domestic abuse, sexual offences and fraud, while policing has also felt the strain of other public services that have been run down and are not fit for purpose: the criminal justice system, mental health services and children’s care. As we rebuild our public services—and we will—we need to simplify the policing mission, which has become blurred and, frankly, too broad. Let us decide what we really want from our police, which means deciding what we do not want our police to do, and where policing stops and other public services are better placed to step in. If we can provide that clarity of purpose for our officers, we can create a better police service that is more focused on preventing and investigating crime.
I am delighted to be making my maiden speech during a debate on taking the railways into public ownership, and I commend my right hon. Friend the Transport Secretary for the speed with which she has set to work in her new office. But on the subject of speed, in my constituency, the Clitheroe to Manchester train takes an hour and 20 minutes to travel a mere 30 miles. The Colne to Preston train takes an hour and 15 minutes to travel just 25 miles. Both offer one diesel train per hour, and they are totally unreliable.
While public ownership is by no means a cure-all, this Bill is a crucial first step in creating a reliable, well-integrated railway that serves every part of our country. Regional inequality in our country is stark, and we need serious investment in infrastructure, such as by reinstating the short rail link between Colne in Lancashire and Skipton in Yorkshire, if we are to see small towns in the north of England thrive and prosper. I believe that public services should be in public ownership, and the railways are no different, so I am delighted to support this Bill.
In conclusion, let me finish by saying to every one of my constituents in Pendle and Clitheroe: whether you voted for me or not, I will be your champion. I will fight for you. It is my privilege to serve you.
The First Deputy Chairman of Ways and Means (Judith Cummins)
I call David Smith to make his maiden speech.
David Smith (North Northumberland) (Lab)
Thank you, Madam Chair. It is a real honour and privilege to be able to make my maiden speech today, as the House debates the role of our railways. Before I continue, I must give credit to all those who have given their maiden speeches today. It is quite a daunting prospect to follow them all. I must comment on a few of the amazing journeys that have brought people here. I think of my hon. Friend the Member for Sheffield Central (Abtisam Mohamed) and the hon. Member for Lagan Valley (Sorcha Eastwood); it was quite inspiring to hear their stories. I must also comment on the speech of the hon. Member for South West Devon (Rebecca Smith), as we are mutual friends of Sir Gary Streeter. It must have been quite a sight to see him do the loco-motion all those years ago.
It is of special importance to me to talk in the debate today on the role of our railways. The east coast main line goes right through my constituency. In fact, I think about half of it does, because we are the third largest constituency in England, with stations in Morpeth, Alnmouth and Berwick. Today we are debating the Government’s plans, over time, to put the railways back into public ownership, or as some might say, into public service. That is really what I want to address today—the idea and ideals of public service. All of us are here to serve the public, but we can only serve here because of the people who have gone before us, the people who support us, and of course the people who vote for us. So first, my thanks must go to the people of North Northumberland, including those who voted Labour for the first time. Indeed, whether they voted for me or not, I will serve them to the best of my ability.
My thanks also go to my family—first and foremost my wife, daughter and son, who are my bedrock and whose patience with me is frankly astonishing, but also to the generations that have gone before. When I think about public service, I think of my grandparents’ world war two generation. We have already heard about Monte Cassino a couple of times. Well, my grandfather fought at Monte Cassino, El Alamein and elsewhere, and it would have been beyond his wildest dreams that his grandson would one day be standing here.
Speaking of those who have gone before in public service, I must recognise the great work of my predecessors as Members of Parliament for what is now North Northumberland. First, those two political peas in a pod, the right hon. former Member for Berwick-upon-Tweed, Anne-Marie Trevelyan, and my hon. Friend the former Member for Wansbeck, now the Member for Blyth and Ashington (Ian Lavery). As a former miner and engineer, my hon. Friend will have a great interest in the success of the railways, and he has also served his constituents with great distinction and tenacity for many years now. Anne-Marie Trevelyan’s public service included many significant roles in government, including Secretary of State for Transport, and I would like to thank her for her graciousness in the handover of the constituency casework. I must also mention Lord Beith. Although he retired from this place in 2015, he is still held in very high regard in Northumberland for his nearly 42 years of service. If I can earn just a small portion of the respect that he garnered, I will consider myself fortunate.
So now I pick up the baton, and I confess that one of the first things I checked, with a name as distinctive as my own, was whether I was the only David Smith MP elected on 4 July. Imagine my surprise and disappointment, then, when on the following day I received a congratulatory email from a Labour Member of Parliament called David Smith. Thankfully, that particular David Smith MP is a member of the Australian Parliament. I am, for now at least, the only David Smith in this place.
It is a convention for Members to try and mention every settlement in their constituency when giving their maiden speech. I have mentioned that mine is the third largest in England, so that may be a challenge. It is also traditional for Members of this place to make competing claims about how theirs is the most beautiful constituency in the land, so I am pleased to be able to put that debate to bed. Surely it is a certainty that the land of Bamburgh and Warkworth castles, of Druridge bay and Holy Island, of Rothbury, Wooler and the Cheviot hills and of the historic county towns of Berwick, Alnwick and Morpeth is the most beautiful in England. The number of Members who have holidayed in my constituency seems to confirm my conclusion. I am sure that those who have travelled on the east coast main line through my constituency, along our magnificent coastline, will do so again.
The Chairman of Ways and Means (Ms Ghani)
I call Katrina Murray to make her maiden speech.
Katrina Murray (Cumbernauld and Kirkintilloch) (Lab)
As a lifelong trade unionist who has spent the last 20 years championing bringing public services back from the private sector, this debate is understandably close to my heart. I congratulate all the other new Members who have made their maiden speech today. They have shown passion and reasons for being here. I very much appreciated the comments made by my hon. Friend the Member for North Northumberland (David Smith) for reasons that may become apparent.
It is a great honour to be the first Member of Parliament for the new constituency of Cumbernauld and Kirkintilloch. My thanks to the people of the communities that make up the constituency for placing their trust in me. I pay tribute to my immediate predecessor, Stuart C. McDonald, who was MP for Cumbernauld, Kilsyth and Kirkintilloch East for the last nine years. It is appropriate that I am making my maiden speech as the ballot for private Members’ Bills takes place in the Lobby, because the progression into law of his private Member’s Bill, protecting the rights of parents of premature babies, shows that we can all make a difference when we work together in the House.
As Stuart C. McDonald said in his maiden speech, the former Member for Glasgow South was also called Stewart McDonald, and there continued to be significant confusion. Many Members may not be aware—well, my hon. Friend the Member for West Dunbartonshire (Douglas McAllister) will know—that there is a further complicating factor locally, in that East Dunbartonshire council’s Kirkintilloch East and North and Twechar ward is very ably represented by Councillor Stewart MacDonald. I thank all of them for the commitment that they have shown to their communities.
I wish to thank a further predecessor, Rosemary McKenna. She served initially as Member for Cumbernauld and Kilsyth, then as Member for Cumbernauld, Kilsyth and Kirkintilloch East, from 1997 to 2010. When I was a young woman activist in the Scottish Labour party, Rosemary was one of the big influences on me that eventually brought me to this place. She was one of the people who sat me down and said, “Maybe just think about standing.”
The new constituency of Cumbernauld and Kirkintilloch runs from the boundary of Glasgow in Millerston to the boundary with Falkirk at Castlecary, and is bisected by the M80 motorway. It is served by Croy station on the main Glasgow to Edinburgh express railway line, with Stepps, Greenfaulds and Cumbernauld being on the local line from Glasgow. Rail services are vital in a constituency where people travel to work.
Cumbernauld was designated a new town in 1955, but it has a very rich history. It includes Cumbernauld village and its weavers, and Condorrat, and the rich farmland between the Campsie hills to the north and the Luggie water to the south. There have been settlements there since before Roman times. The northern boundary of Roman Britain, the Antonine wall, runs through the constituency. The Bar Hill fort, garrisoned by people from across ancient Europe and the middle east, established to protect the wall, is still accessible from Twechar.
Evidence of the mining history of the constituency remains strong. There is the Kilsyth Victoria cottage hospital, one of the places in the constituency where I first went to work; the remnants of the miners’ rows, which are now farm outhouses; and the vast swathes of new housing built on former colliery land in Cardowan, Chryston, Kilsyth and Twechar.
It would take a far braver woman than me to make comments about football in the weeks leading up to or following an Old Firm game. Cumbernauld’s most famous outing on film was in the 1980’s Bill Forsyth classic, “Gregory’s Girl”. For those who are not familiar with the film, it centres around a school football team who experience a significant improvement in form when one of the girls, Dorothy, turns up for the trials and subsequently plays up front as a striker. This film is a firm Murray family favourite. Our house was burgled when I was quite young, and the younger members of the Murray family were probably more upset that the “Gregory’s Girl” video was in the recorder that had been stolen, so it is poetic that one of Scotland’s biggest women’s teams, Rangers Women, play all their home matches in Broadwood in Cumbernauld. I am sure that I can pass on the best wishes of probably most in this House for when the team faces Arsenal’s women’s team in the semi-finals of the first qualifying round of the champions league tomorrow.
As I have said, one of the big selling points of the constituency is its connectivity to Scotland’s central-belt cities. If there is to be that connectivity, we need a proper, integrated public transport system, based on public need, rather than on the most profitable routes. No matter which part of the constituency I am in, what people want to talk to me about most is public transport—whether it is an amended railway timetable that means that there are no services after 10 am on a Sunday, or a bus service that gets cancelled because there is no cover to allow the driver to take a break. During the summer holidays, the youth group at Twechar Healthy Living and Enterprise Centre planned a day trip to Millport using the bus service. It involved multiple buses and ferries, but it required phoning around to get lifts back to the village for the last leg of the journey, as the Twechar bus stopped running at 5 pm.
Like most of us, I have spent more time than is healthy considering the basis of my politics and values. One benefit of making my speech later on is that I have been able to listen to the maiden speeches of so many other Members. When the hon. Member for Dumfries and Galloway (John Cooper) made his maiden speech, he spoke about Galloway dairy farms, which was important to me because I immediately thought of my grandmother. She grew up on one of those farms. The oldest daughter of the dairyman, she was bright; she passed her 11-plus and was entitled to a place at the grammar school. But in the 1920s, dairymen’s daughters did not go to grammar schools, certainly not if they were the eldest and they had six younger siblings. She never forgot that, and among her children, grandchildren and great-grandchildren there was an expectation that we would take all the educational chances open to us, and fight for them when they were not obvious. We were expected to “stick in” at school, go to university and, when we had got our qualification, embrace a life of service.
I am proud to come from a family of teachers, doctors, civil servants, health workers, school staff and social care staff. I am also proud of the fact that my parents are here today. We were supported in challenging things that were not fair and standing up for ourselves. It is probably no surprise that I ended up a trade unionist in the health service, fighting for public services and never shutting up.
For the whole of my working life, I have worked in partnerships and tried to build alliances between workers, and between communities. Many of the communities of Cumbernauld and Kirkintilloch are at a point of transition. It is in a spirit of partnership and alliance that I will work to strengthen the bonds that bind our people together. I will work in this place, and in Cumbernauld and Kirkintilloch, to confront the challenges that we face around those points of transition, and to ensure that what unites us guides us. This afternoon, we have heard from across the House all the points that unite us. Let us focus not on difference, but on areas of agreement, because we cross paths far more often than we cross swords.
David Pinto-Duschinsky (Hendon) (Lab)
I wish to start by thanking my hon. Friend the Member for Cumbernauld and Kirkintilloch (Katrina Murray) on her witty and passionate speech. Her commitment to public service and her drive to improve the lives of her constituents shine through. I would also like to compliment all those who have given their maiden speech today. The standard has been exceptional. What an honour it is to speak after so many inspiring colleagues, and what an honour it is to give my first speech in this Chamber during a debate on the future of our railways. So many of my constituents depend on Mill Hill Broadway and Hendon stations, and this Bill, bringing the railways back into public ownership, placing passengers at the heart of our rail system and ensuring value for money for the taxpayer, will make a real difference to them. Getting the management of our railways and the numbers underpinning them on a sound footing is crucial.
The Chairman of Ways and Means (Ms Ghani)
I call Rachel Taylor to make her maiden speech.
Rachel Taylor (North Warwickshire and Bedworth) (Lab)
It is an honour to follow my hon. Friend the Member for Hendon (David Pinto-Duschinsky), particularly after his eloquent speech, talking without hesitation about his history, his ancestors and the struggles that he has faced—thank you.
It is a great honour to make this speech during the Passenger Railway Services (Public Ownership) Bill. The Bill is important to me and my constituents, who face many years of disruption and confusion because our trains and stations are operated by different companies. It will bring our trains back under the control of the public sector, generate investment in our stations, and make it easier for constituents like mine to book travel and tickets. Hopefully, it means that our rail services will be made truly accessible for disabled passengers, with support and help always guaranteed.
I pay tribute to my predecessor, Craig Tracey, who was hard-working and served our constituency well. He did important work for breast cancer awareness and raised questions in Parliament on issues that matter to our constituents. He was supportive of local events. I am sure that constituents and Members of this House will join me in thanking Craig for his work and wishing him and his family all the best for the future.
I also pay tribute to my friend Mike O’Brien, who was the Labour MP for North Warwickshire between 1992 and 2010. While in Parliament, Mike held numerous ministerial positions. He was on the Home Affairs Committee that helped to increase the number of refuges for victims of domestic violence. As Minister of State for Pensions, he worked on the Pensions Act 2008, which improved working peoples’ pensions. As Minister of State for Health Services, he negotiated compensation for victims of thalidomide. I appreciated his help and guidance during my campaign. He was well loved by his constituents, and I hope to live up to his legacy.
I have always been someone who gets stuck in to change things that need changing and speak up against injustice. That started from a young age, growing up in North Warwickshire, where I campaigned for girls to be able to wear trousers at my school. I credit that attitude to my parents. My dad’s family could not afford for him to stay on at school, so he left to become a trainee mining surveyor, and went on to do qualifications throughout his working life. He became one of the youngest magistrates in the country, worked in urban renewal in Birmingham, and, in his spare time, drew plans to help individuals and community groups to secure planning permissions. He also paid for our many summer holidays. My mum worked as a registrar for births, deaths and marriages, and was the local parish council clerk, but still found the time to make most of my clothes. I thank them both for being here with us today, along with my partner, Dawn, who was a great support throughout my campaign—thank you.
My parents were both driven by a desire to do their best for their family. They instilled those values of public service and hard work in me, and supported me and my brother to follow our passions. I went to my local comprehensive school, which has evolved to become what is now the Queen Elizabeth academy. That school has made great strides to improve attendance and results, but it still struggles with inadequate facilities.
I worked as a tennis umpire at Wimbledon for 10 years, and I have watched in recent years as grassroots tennis has flourished and become more inclusive, particularly at my local club in Coleshill. That is part of the legacy of Sir Andy Murray and the valuable work of the Lawn Tennis Association. I remember trying my hand, as an umpire, at wheelchair tennis—the professionals make it look so much easier than it is. It was wonderful to see Lucy Shuker bearing the flag for Team GB at the Paralympics, and to see British players doing so well at the US Open. Even in my 50s, I was honoured to play tennis for my county of Warwickshire.
Now, I can reflect on how much sport and drama have contributed to my life and the lives of those I have met through those activities. For me, sport and drama were drivers of social mobility, and they help to give confidence and aspiration to so many young people, breaking down barriers to opportunity. That is why I will work hard to ensure that young people gain access to activities and local facilities that have sadly been lost across the country.
I went to university in Leeds in the mid-1980s, in the midst of the Thatcher Government’s attack on working people and the divisive dialogue that made it a frightening time to come out as gay. In 1988, this place passed into law section 28 of the Local Government Act 1988, banning schools from telling young people that it was okay to be gay, so that a generation of young people were frightened, bullied and held back. I played my part in the protests against section 28, and I was proud that the last Labour Government did so much to improve rights for our community.
Research by the Campaign Against Censorship, which was reported by Stonewall this August, shows that, even in this day and age, LGBT books are being removed from school libraries after complaints. Last week, the TUC reported the shocking news that over half of LGBT workers have experienced bullying, harassment or discrimination at work. It is important to take stock and recognise the great strides that we have made towards equality, as well as the important strides that the new Labour Government will make, including the vital ban on conversion therapy and the commitment to ensuring that young trans people receive high-quality healthcare. I want to assure my constituents and LGBT people across the country that I will work hard to protect the important gains we have made and to tackle the over-simplistic and often hateful discourse that we hear about trans people, just as I campaigned against section 28 almost 40 years ago.
The Parliamentary Under-Secretary of State for Transport (Simon Lightwood)
It is an honour to serve under your chairmanship, Madam Chair. I thank hon. Members of all parties for their amendments, and for their considered contributions. I commend those Members who have delivered some fabulous maiden speeches today, with such quality, passion and dedication to serve, and a love for their communities. It makes me really proud to be a Member of this House, and I am certain that the memory of delivering their maiden speeches will live with them forever.
I will begin with amendments 18 and 8 to 12, tabled by the hon. Member for Faversham and Mid Kent (Helen Whately). These relate to monitoring, reporting and scrutinising the impacts of public ownership and the effectiveness of train operators. Amendment 18 would require the publication of two reports. The first would outline the anticipated impact of public ownership. That would simply duplicate the impact assessment published earlier this year, and therefore would be redundant. The second report would assess the actual impact of public ownership, some years after implementation. A wide variety of data is already routinely published about both public and private sector train operators’ performance. That includes reliability, punctuality, service quality, customer complaints and financial performance among other measures. The Bill does not change any of that and there is no need to wait five years to consider whether train operators’ performance is improving.
Amendment 9 would require the Secretary of State to procure independent reports about the costs of the contracts awarded to public sector operators. The Department already publishes information on payments made to operators, whether private or public. There is therefore no need for the taxpayer to fund a separate body to report the same data. Nevertheless, the hon. Lady is entirely right to take an interest in the cost of these contracts. In that spirit, I would gently remind her that ending the taxpayer funding of private profits will result in an immediate and enduring reduction in these costs.
Amendment 9 also raises the specific question of whether public ownership will expose the Government to liabilities that have previously sat with private operators. Under the current national rail contracts, the Government fund the costs legitimately incurred by train operating companies. That includes, for example, the net operational cost of running services and the cost of meeting pension liabilities. Prior to the pandemic, franchised operators bore some cost risk, but were protected by the taxpayer against, among other things, inflation and, in more recent contracts, risk on movements in pension deficit recovery payments. The franchising system meant that bidders simply priced any change in liabilities into their bids, meaning that the taxpayer was exposed to liabilities in the long term. Public ownership therefore does not materially change the Government’s exposure to liabilities in the long run.
Amendment 10 would require the annual reporting to Parliament on various aspects of the performance of public sector operators, and amendment 12 would require an independent report on the impact of public ownership on the performance and efficiency of the UK rail network. Again, data is already published on a wide variety of aspects of train operator performance, including by the Office of Rail and Road in its role as a regulator. The Bill does not change that. The Office of Rail and Road also provides independent scrutiny of the performance and effectiveness of Network Rail, enforcing compliance with its licences and conducting five-yearly reviews that set its funding and what must be delivered with that funding.
Amendments 8 and 11 look to require independent monitoring of the financial and operational performance of public sector train operators. The Department holds train operating companies to account for their financial management through regular reviews of their management accounts and business plans. That applies to both public and privately owned operators. In addition, in England publicly owned operators are overseen by DFT OLR Holdings Ltd, known as DOHL. As a holding company owned by the Secretary of State, DOHL is experienced in reviewing and monitoring the financial arrangements of the companies it manages, and contrary to what the hon. Lady said, it is building its capacity in readiness to take over more services. At the same time, public ownership will reduce the other contract management costs, because there will no longer be the same commercial tension of the taxpayer interacting with private profit. Amendment 8 refers specifically to the auditing of publicly owned train operating companies’ accounts. It is already the case that DOHL and the operators it oversees must publish their audited accounts annually.
Turning to amendment 11, train operators are already monitored under their existing contracts against targets for punctuality, reliability and service quality. They are also held to account for managing within pre-set cost budget limits each financial year. Driving up operators’ performance in those areas is vital, and the Government will continue to review train operator performance regularly in those and other areas. This has been an early priority for my right hon. Friend the Secretary of State. For example, in her first weeks in office, Ministers held meetings with the managing directors of Avanti West Coast, TransPennine Express and their Network Rail counterparts to set clear expectations for immediate improvement. In parallel with these arrangements, the Government are developing detailed proposals for holding the future Great British Railways to account for performance. This will form part of the broader package of reform that we will set out in the forthcoming railways Bill. We expect these arrangements will be in place long before the five-year reviews proposed in a number of amendments tabled.
Amendment 11 also refers to performance improvement plans. Mechanisms to require improvement plans are already a feature of the Government’s contracts with both public and private sector operators. The Secretary of State has recently put in place formal remedial plans with CrossCountry in view of its unacceptable levels of cancellations and service reductions. Finally, amendment 11 raises the question of senior management remuneration when performance is poor. This matter can be considered when remedial plans are being put in place, taking account of the circumstances in each case.
Amendment 19, also tabled by the hon. Lady, and amendment 20, from the hon. Member for Bath (Wera Hobhouse), both propose additional procedural steps to be followed before a contract is awarded to a public sector operator. Amendment 19 would require the Office of Rail and Road to publish an opinion on the practicability of transferring services to each public sector operator. Clearly it is vital that services are transferred to public ownership smoothly, without detriment to the quality of service during the transition. For that reason, the transfer of services will take place using a well-established arrangement and process. DOHL has significant experience of managing the transition of services from private to public operation in recent years.
Simon Lightwood
I will not give way to the hon. Lady, as she has had plenty of time to put her case.
Those transfers of services have been completed successfully and smoothly despite the challenging timescales and circumstances, which have included financial failure and poor operator performance. We have also made it clear that we will transfer services on a phased basis as existing contracts expire over the next few years. This is a measured, responsible approach that will further de-risk the process. The Bill does not alter the ORR’s role in granting operators’ licences and issuing their safety certificates; in that role the ORR already independently assesses the suitability and readiness of any operator, public or private, to take over services and operate them safely. In light of those safeguards the Government do not see the need to commission further analysis from the ORR, as amendment 19 proposes.
On amendment 20, the Department for Transport has already awarded multiple contracts to publicly owned operators and has considerable experience of managing them in practice, taking legal, financial and technical advice as needed. We consider a new independent advisory body to be an unnecessary additional step that would add cost and risk delaying progress. I can assure the hon. Member for Faversham and Mid Kent that the Department for Transport is conducting a full review of the standard terms of service contracts entered into with public sector operators, reflecting the fact that public sector operation is to be the Government’s long-term approach, not just a temporary measure of last resort.
On amendments 13 and 14, the Government do not consider it appropriate to spell out such specific contractual requirements in primary legislation, which would risk constraining future flexibility to adapt operators’ contractual obligations to suit changing circumstances. On amendment 13 specifically, it would not be efficient for the taxpayer to require up to 14 different operators in England, plus those in Scotland and Wales, to each pursue its own separate wide-ranging innovation strategy. Indeed, a key purpose of our wider reform plans is to drive a much more coherent cross-industry approach in such areas. On amendment 14, I question why the four groups identified, while clearly of course very important, should be singled out for a specific mention when there are many other relevant considerations to take into account in service design, including the interests of the taxpayer, freight users, people with disabilities and residents of urban areas to name just a few. The list could be endless, and the important point is that decisions about future service levels should take into account all relevant considerations.
Amendment 1, tabled by my hon. Friend the Member for Blackley and Middleton South (Graham Stringer), would remove the power of the Secretary of State to continue existing franchises. I am happy to reassure my hon. Friend that this provision is included in the Bill as a contingency measure only. It exists in case a short continuation is needed to ensure that services transfer to public ownership smoothly and without disruption to passengers. It is intended to be used only in exceptional circumstances and only for so long as necessary to ensure the smooth transfer. It will be available to the Secretary of State only when
“it will not be reasonably practicable”
for a transfer to proceed. Any continuation would be limited by procurement regulations to a maximum of two years in duration, but in practice we would expect the period to be much shorter. The power is clearly transitional in nature; once services are transferred to the public sector it will no longer be relevant, and clause 2 therefore gives us the power to repeal it in its entirety. This is a sensible, pragmatic precaution that exists simply to smooth the transition to public ownership and protect the travelling public from disruption. I hope that explanation offers my hon. Friend some reassurance.
I move now to amendment 6, tabled by the hon. Member for Moray West, Nairn and Strathspey (Graham Leadbitter). The Bill does not affect the provision of rolling stock. It would not be responsible or affordable for the Government to take on the cost of renationalising billions of pounds-worth of rolling stock when there are so many other urgent pressures on the public purse. However, public ownership will open the door for a much more coherent approach to planning the longer-term rolling stock needs of the whole industry. Once Great British Railways is established, planning the provision of rolling stock across the network will be one of many areas where a single directing mind for the railway will add real value.
We will develop a long-term industrial strategy for rolling stock that supports manufacturing, innovation and interoperability and aligns with the wider objectives of the industry. It will look to end the boom and bust cycle of rolling stock procurement, ensure sustainable pipelines for future work and consider the best financing structures for future orders in partnership with private capital. I can assure my hon. Friend the Member for Easington (Grahame Morris) that we will consider the points he has raised as we undertake work on this matter. My officials are engaging with Eurofima to consider the potential of UK membership and the role that could play in the UK market. We will set out more plans on that in due course. A report mandating that in primary legislation is therefore not necessary in the Government’s view.
Amendment 7, tabled by my hon. Friend the Member for Derby North (Catherine Atkinson), seeks details of the Government’s proposed approach to procurement and the impact of public ownership on the procurement process and the supply chain. She is absolutely right to highlight the crucial role of the broad and diverse private sector supply chain in helping to deliver high-quality rail services, and I very much welcome the contribution made by businesses in her constituency and right across the country. I can assure her and those businesses that innovation and technical progress will remain as fundamental as they have ever been in delivering improvements for passengers, cost efficiency for taxpayers and benefits for the environment.
I can confirm that there will be no immediate impact on the approach to procurement when services transfer to public ownership. Existing private sector operators are already required to follow the same procurement rules as public sector operators. Under the governance reforms, Great British Railways will provide much clearer long-term direction across the whole railway system, giving businesses and the supply chain the certainty and confidence they need to plan, invest and innovate for the future.
Amendment 15, tabled by the hon. Member for Faversham and Mid Kent, considers the Bill’s potential effects on open access operators. The Bill is specifically about the ownership of services currently operated under the contract with the Secretary of State and Scottish and Welsh Ministers. Public ownership of those services will not prevent open access services from running as they do now. The report proposed by her amendment is therefore unnecessary. However, I take this opportunity to reassure her about the role of open access in the future in the context of the Government’s wider reforms. How we make use of network capacity and grant access is fundamental to the performance of the railway and what it delivers for all its users. Open access operators such as Hull Trains, Lumo and Grand Central are a valuable part of our railway. We are keen for such services to continue to operate alongside publicly owned services, where they add value and capacity to the network.
The hon. Lady’s amendment 16, along with amendment 22 from the hon. Member for Bath and amendments 2 to 5 from the hon. Member for Brighton Pavilion (Siân Berry), touches on the role of devolved and local authorities in the planning and delivery of rail services. Amendments 16 and 22 each refer to exemptions granted under section 24 of the Railways Act 1993. Those exemptions allow services in London and the Liverpool city region to be procured by the relevant authorities in those areas, outside the franchising system. The Bill makes no change to those existing arrangements and it will remain for those authorities to decide how best to deliver the services for which they are responsible.
Amendments 2 to 5 would allow the Secretary of State and Scottish and Welsh Ministers to award contracts to companies owned by certain elected public bodies. While the Government are committed to strengthening local involvement in the planning and delivery of rail services, it will be important to ensure that does not undermine the plan for Great British Railways to act as a directing mind that provides coherence, consistency and clarity for the whole railway. To support that, the Government intend to award contracts specifically to public sector companies owned by the Secretary of State via DOHL.
Wera Hobhouse
Our amendment 22 is not just about the current arrangement with Merseyrail and Transport for London; it is much more about having the discussion about how local authorities and local areas can enter into franchising agreements in future if they so wish.
Simon Lightwood
I do not think that the Bill stops them doing that now, though we have no plans to extend the scope of that.
Looking ahead to the railways Bill, the Government have already said that there will be a statutory role for devolved leaders in Scotland, Wales and mayoral combined authorities in governing, managing and planning and developing the railway network. That will ensure that decision making is brought as close as possible to local communities.
I turn to amendment 17, tabled by the hon. Member for Faversham and Mid Kent, which proposes an independent body to advise the Government on employment terms and pay for rail staff under public ownership. That is an important issue, and one that the Government are determined to get right. My officials are at the early stages of exploring a number of options—including a pay review body—so that we can consider the most appropriate approach to meet the needs of a transformed industry.
Last but by no means least, I come to amendment 21, tabled by the hon. Member for Bath, which deals with fares, ticketing and passenger compensation. Naturally, we are keen to see rapid progress in those areas. We are committed to reviewing the overly complicated fare system. Change is already being delivered by extending pay-as-you-go in the south-east and through fares reform on LNER. We will explore the options for expanding ticketing innovations such as digital pay-as-you-go and digital season tickets across the network, and we will hold operators—and, in due course, Great British Railways—accountable for progress on these vital reforms. We also intend that a powerful new passenger watchdog—the passenger standards authority—will independently monitor standards and champion improvement in service performance against a range of measures.
I thank hon. Members on both sides of the Committee for their contributions to the debate. I hope that my responses will have provided the explanations and reassurances that colleagues were seeking, and that that will enable them not to press their amendments and to support the Bill on Third Reading.
Dr Kieran Mullan (Bexhill and Battle) (Con)
It is a pleasure to conclude the Committee of the whole House for the Opposition, and it has been a pleasure to sit and listen to another set of distinguished maiden speeches from Members on both sides. I join the Minister in the tributes he paid to the speeches made from the Government Benches. I pay tribute in particular to the hon. Member for Thurrock (Jen Craft) for her moving remarks about her commitment to her daughter and to the hon. Member for Hendon (David Pinto-Duschinsky) for his powerful remarks about how his life is inspired by the bravery of the woman who saved his father’s life.
On the Opposition side of the House, we had maiden speeches from my hon. Friends the Members for Bridlington and The Wolds (Charlie Dewhirst) and for South West Devon (Rebecca Smith). My hon. Friend the Member for Bridlington and The Wolds did a fantastic job of selling the tourist credentials of his constituency and proudly declared himself the Member for both pigs and lobsters. I am sure that his passion for the place where he grew up will serve his constituents well. My hon. Friend the Member for South West Devon spoke proudly of the history and beauty of her constituency. The House will be richer for her experience working for the War Graves Commission and her interest in foster caring.
We also heard from my right hon. Friend the Member for Aldridge-Brownhills (Wendy Morton), who used her previous experience as a rail Minister to explain clearly the changes that we need and have sought. She also highlighted the lack of evidence and arbitrary nature of the Government’s approach as well as the lack of thinking about the Bill’s implications at a local level for projects such as the west midlands rail hub.
That brings me to the matter before us, where I am afraid my ability to find words of praise dries up. As my hon. Friend the shadow Transport Secretary outlined, we have been asked today to rush through a major change to the operation of our railways on the back of a rushed Second Reading and without all the benefits of a full Bill Committee.
What exactly was it about giving stakeholders in the railway industry the chance to share their views in Bill evidence sessions that the Secretary of State was so afraid of? I wonder what witnesses might have raised—perhaps the fact that the facade of a simple solution to the challenges on the railway presented by the Secretary of State has already fallen away in the intervening weeks since Second Reading. On Second Reading, she praised the already nationalised LNER service while chastising private sector operators, warning them that they needed to get their house in order. I cannot decide whether the ASLEF leadership are just being unkind to her or have a mischievous sense of humour, because the day after crudely championing the no-strings deal they had secured from the Government, where did union bosses announce they intended their next round of industrial action to be? Not in one of the private sector operators that the Secretary of State is rushing to wrest back into public control, but in the publicly owned and run LNER. There could be no more definitive answer to the question of whether the Bill will make any real difference. If public sector operators are the answer, the Secretary of State might want to ask ASLEF why it described its public sector managers as brutal, bullying, promise-breakers. The risks for passengers and taxpayers are in stark headlights. Thankfully, the industrial action has been called off, though passengers’ travel plans were disrupted this weekend. It seems that we will avoid a protracted strike, but what concessions were made to ASLEF, and what involvement did Ministers have? We have no idea, and we will have a similar lack of transparency in future, if the Bill passes unamended.
What of the private sector operators that the Secretary of State has been so critical of, and critical of us for allowing to continue? What can we learn from her dealings with them? Despite all her warm words to her Back Benchers, what has she done since Second Reading, using her existing contractual powers, to bring operators such as Avanti back into public ownership, if she really believes that will make a difference? She has quite literally spent years repeatedly describing it as failing. She has had almost two months to remove the franchise from it, which she could legally do if it were in breach of contract and not delivering, as she has repeatedly implied. I am sure that some of her Back Benchers will have noticed that she has not done that. It is yet further proof that she knows that the question of who runs the railways will not make a material difference.
The Secretary of State knows that bringing Avanti and others into public ownership will not miraculously solve anything. In fact, the seven most punctual operators last year were private sector operators. Of the seven worst performing operators for cancellations in 2023-24, four were publicly run.
At the start of the Committee, the shadow Transport Secretary outlined a number of important questions, which I hoped the Minister would answer in support of his argument that we should vote with him tonight. How will accountability for improving performance be achieved? How will costs be controlled? How will innovation and reform be driven forward? How will pay negotiations be conducted fairly for taxpayers? Those are basic questions that, after 14 years, Labour should be able to answer, but we will vote tonight with them unanswered.
I want services to improve—in that respect, we all want the same thing—but the Bill as is has little chance of making that happen. It will just result in back-room deals that will, more likely, put union bosses first and bring no guarantees of improved performance for passengers. I respect and value railway staff, but Governments have wider responsibilities to taxpayers. The Government have the right to proceed anyway, but our amendments aim to at least ensure accountability and transparency, and would make passengers, not union bosses, the focus.
We seek to ensure the best use of the Committee’s time, so we will not press amendment 18 to a Division, but with permission of the Chair, we will press amendments 14 and 17 to a vote, as the ones most able to secure the best version of the Bill. Amendment 14 makes it crystal clear that the primary duty of public sector operators is to passengers. Whatever ideological change this Government make to the ownership of the railways, that should never change. Amendment 17 aims to prevent a repetition of the no-strings deal given by Labour to its union boss donors, and to ensure independence in the process. Time and again, Labour Ministers have supported the importance of independent advice in determining the pay of public sector workers. Every single Labour MP voting against this amendment lays bare the stranglehold that the rail union bosses have over their Prime Minister and Secretary of State. If they single them out for special treatment, they will need to justify to other public sector workers in their constituencies why rail union bosses are exempt from the processes that to apply to teachers, soldiers, nurses and millions of other staff.
To reiterate, we on the Opposition Benches are in agreement that change is needed, but practicality and what works should come first, not this rushed, ideological approach. Members in all parts of the Chamber can see that our amendments simply create safeguards for passengers and taxpayers, and ensure transparency and fairness. I hope that Government Members can see the benefit of that, and agree, even if they are convinced of the benefits of nationalisation, that there are better ways to do it. In that spirit, I call on them and all Members to support our amendments, and to deliver a better Bill in the Division Lobbies this evening.
Amendment, by leave, withdrawn.
Clause 1 ordered to stand part of the Bill.
Clause 2
Future provision of services
Amendment proposed: 14, page 2, line 17, at end insert—
“(1BA) Every contract made in accordance with subsection (1A) shall place a duty on the public sector company to consider the needs of—
(a) passengers;
(b) residents of rural areas;
(c) residents of areas underserved by the rail network; and
(d) the wider rail network
when considering making changes to existing service levels.” —(Helen Whately.)
Question put, That the amendment be made.
The Committee proceeded to a Division.
The Chairman
Will the Serjeant at Arms investigate the delay in the No Lobby?
The Secretary of State for Transport (Louise Haigh)
I beg to move, That the Bill be now read the Third time.
It has been an extraordinary privilege to take this Bill through the House, as the first major piece of legislation to pass through the Commons under this Labour Government. The work to rebuild Britain and return to a politics of service started the moment we entered office. We pledged to act decisively to get our country moving and our public services working. I set out my motto for the Department for Transport—to move fast and fix things—which is why this Bill wastes no time in fulfilling one of our central manifesto commitments, calling time on the 30-year ideological privatised experiment on our railways that failed passengers, failed to modernise our railways and failed our economy. It is why this Government have begun the work of reform by bringing services back into public ownership, so that our railways will finally be run in the interests of passengers.
There will be immediate benefits. Our railways will serve the British public, be they passengers or the taxpayer, and as we bring services into public ownership, we will drive up performance. We will remove the burden of the millions of pounds squandered every year in private sector management fees. We will bring services into public hands as soon as their contracts expire, but if operators fail to deliver in line with those contracts—if they continue to let passengers down time and time again—I will not hesitate to use every tool at my disposal to drive up standards, including terminating contracts early where appropriate. In my meetings with Avanti and TransPennine and in the rail Minister’s meetings with Northern, London North Eastern Railway, East Midlands Railway and CrossCountry, as well as their Network Rail counterparts, we have been clear that we will not tolerate for any longer the poor performance that the last Government tolerated. My officials will drive improvements using the mechanisms in those contracts.
That work is already bearing fruit. Last week, LNER and ASLEF resolved their long-standing local dispute at no cost to the taxpayer, preventing 22 days of industrial action while ensuring an improved service for passengers. As a result, there were no driver cancellations over the weekend or this morning—the first time that has occurred for many years. Last month, we ended the longest strike in our railways’ history. It was a strike that cost the taxpayer hundreds of millions of pounds in lost revenue and cost the economy more than a billion pounds, and a strike that the Conservative party deliberately prolonged and provoked, at enormous cost to the taxpayer and passengers.
A passenger-centred railway needs workforce reform; I do not shy away from that fact. As we move towards Great British Railways, we will waste no time driving those reforms forward. This is an area where the party opposite totally “failed”. That is a quote from the former Conservative Rail Minister, who is no longer in this place. To his credit, unlike his colleagues, he has at least had the decency to apologise for what he put our country and our railways through.
We are under no illusion: the Bill is not a silver bullet. It is the first stop on our journey to a modern railway for a modern Britain. We will introduce separate legislation later in the Session on the wider reforms that are required. Fixing the industry’s crumbling foundations is the only way to deliver the lasting improvements that passengers expect and deserve. Providing national leadership and a single point of accountability, Great British Railways will bring track and train together. It will plan services on a whole-system basis. It will increase innovation while cutting waste. It will put an end to outdated working and management practices, and end the operational meddling of Whitehall that has characterised the industry, particularly post covid. In short, we will create a simpler, safer and more reliable rail industry, relentlessly focused on passengers and on growing our economy.
That, of course, cannot happen overnight, but as passenger in chief, I am not prepared to wait. That is why today I have made a written ministerial statement formally standing up shadow Great British Railways, in order to bring together the Department’s passenger services, Network Rail and the operator of last resort. For the first time in 30 years, the railways will begin to act as one coherent system, and there will be the political backing for decisions to be made in the public interest. Shadow Great British Railways will review performance and finances. It will begin work to modernise our railways and unblock barriers to ticket reform, and will start to make urgent improvements now for passengers and freight.
Before I finish, I thank the Under-Secretary of State for Transport, my hon. Friend the Member for Wakefield and Rothwell (Simon Lightwood), for his excellent work, support and dedication of time to getting the Bill through the House. I also thank the Clerks, Chairs and parliamentary counsel, and of course my fantastic officials, who have worked at pace and done an excellent job supporting us in our first two very short months in office. Finally, I am hugely grateful to hon. Members from all parts of the House for their scrutiny and collaborative approach. I add my congratulations to the many hon. Members who made their maiden speech during the Bill’s passage.
The Bill represents a line in the sand. It shows that the Government are willing to roll up their sleeves and do the hard work to fix what is broken and reform what does not work. Getting this right matters for people up and down the country, for whom the railways are their route to opportunity. It matters for communities that need a reliable railway to support businesses, retain talent and attract investment, and it matters for this mission-focused Government, because the railways underpin our efforts to rebuild Britain, from building economic growth to providing clean energy, and to deliver hope and opportunity to everyone, wherever they live. I commend the Bill to the House.
Helen Whately
We recognise the Government’s mandate to nationalise the railways. We are not seeking to frustrate that, but simply to improve their legislation. I have heard the arguments of Government Members and the Secretary of State in support of the Bill, but I remain unconvinced and unreassured. We agree that rail needs reform, but we disagree on how to do that. I thought we agreed that passengers were the priority, but it seems that we disagree on that too, because Government Members have just voted against a simple amendment that would have ensured that public operators served the needs of passengers, including in rural and underserved areas.
I would have hoped that we could agree on the importance of controlling costs, including one of the biggest costs that the railways face, which is that of the workforce, but again we clearly disagree on that. The Government have caved into ASLEF’s pay demands with a “no strings, no modernisation” pay deal, and now Government Members have voted against our proposal for an independent pay review body, a simple mechanism to help the right hon. Lady make sure she is not steamrollered into conceding to excessive and expensive pay demands by Labour’s powerful union paymasters. However, I welcome the hint from the Minister with responsibility for local transport that the Government may be considering introducing something along those lines, and I look forward to hearing more about that.
Here we are on Third Reading of the Bill after just a few hours of debate. Rushing this Bill through makes no sense at all. Why? Are the Government throwing a bone to their Back Benchers in return for their backing cuts to the winter fuel allowance? Is it to please the unions that donated to Labour Members’ campaigns? Is it a distraction from dodgy appointments and the conduct of their Rail Minister in the other place? Or do the Government Front Benchers believe this to be a minor change, though it is not? Is that why they think so little scrutiny and parliamentary time is required?
I urge the Government to think long and hard about the amendments we have put forward. Although we do not agree with this plan, as I have said, we accept their mandate to deliver it. We are simply proposing sensible changes to protect passengers and taxpayers, and I urge them to reconsider during the Lords stages of the Bill.
Question put and agreed to.
Bill accordingly read the Third time and passed.
Passenger Railway Services (Public Ownership) Bill
Wednesday 4th September 2024
(2 months, 2 weeks ago)
Lords ChamberRead Full debate Passenger Railway Services (Public Ownership) Bill 2024-26 Read Hansard Text Amendment Paper: Committee of the whole House Amendments as at 3 September 2024 - (3 Sep 2024)
Passenger Railway Services (Public Ownership) Bill
Monday 7th October 2024
(1 month, 2 weeks ago)
Lords ChamberRead Full debate Passenger Railway Services (Public Ownership) Bill 2024-26 Read Hansard Text Watch Debate Amendment Paper: Committee of the whole House Amendments as at 3 September 2024 - (3 Sep 2024)
Baroness Blake of Leeds
That the Bill be now read a second time.
Baroness Blake of Leeds (Lab)
My Lords, I am pleased to present the Passenger Railway Services (Public Ownership) Bill for Second Reading today. Public ownership will allow us to end the failed franchising system which has inflicted misery on passengers through delays, overcrowding and poor service—a system in which far too many conversations are about how the railway works or, more often, does not work, and too few are about what the railway is for. At its heart, the railway is there to allow people and goods to move from A to B, which is vital in supporting jobs, housebuilding and quality of life. Railways are central to the Government’s missions to kick-start economic growth and break down barriers to opportunity, as well as helping us move towards net zero.
We need to change the whole culture of the railway to place all passengers back at the heart of the system. This Bill will ensure that trains are run for the benefit of the British public, not for the profits of shareholders around the world. I will be clear: there is a great deal of work ahead to reverse three decades of failure, fragmentation, inefficiency and waste. Bringing the railway infrastructure back into public ownership after the failure of Railtrack in the early 2000s was a helpful step, allowing the infrastructure manager to collaborate better with train operators, but it was just one small step. Two decades later, the system remains far too fragmented, and that is costing the taxpayer dearly.
This Bill will mean that we can finally have trains that are run for the public by the public. It is narrow in scope and serves just two main purposes. First, it will enable us to bring rail passenger services back into public operation as the default option when contracts end, not just as the last resort. Secondly, it will allow us, and our counterparts in the Scottish and Welsh Governments, to keep them in the public sector rather than having to put them back out to tender.
The Bill is just the first step—although a very important one—towards a much wider programme of reform. The need for reform could not be more obvious. In recent times, the franchising system has delivered record high levels of cancellations, frequent overcrowding, a frankly bewildering ticketing system and hugely disruptive periods of industrial action. The list goes on.
Reform of the railways has cross-party support. In fact, it originated in 2018 when the Conservative Government commissioned Keith Williams to carry out a root-and-branch review of the whole railway system. His review confirmed just how fractured and fragmented the railways are. As did the Blake Jones review, which I co-authored at the same time; I am afraid I too have contributed to the plethora of reporting on this matter.
The manifestos of all three political parties acknowledged the need for reforms to address this fragmentation. We all agree that things cannot continue as they are. There is strong public support and a clear democratic mandate for public ownership, so I sincerely hope that noble Lords on all sides of the House can put politics aside to get behind this Bill as a vital first step towards fixing our broken rail network.
That is why we have brought in this public ownership Bill as an urgent priority, and we will introduce a railways Bill later in this Session to bring about a much wider programme of reform. This will include setting up Great British Railways to act as a directing mind and put the whole railway back into the service of the travelling public and freight users.
In this debate, I am sure that some noble Lords will question the case for public ownership. In addressing that head-on, let me highlight one noticeable change for the better that did come about under the previous Government. They appointed no fewer than four public sector train operators to take over from failing private sector companies. They must agree that public ownership is a good thing, as they kept LNER in the public sector for six years and Northern for four. The devolved Governments in Scotland and Wales also support public ownership. They are right behind this Bill because it will avoid the need for them to put their publicly run services back into private hands.
Publicly owned operators exist to serve the interests of passengers and taxpayers, not to maximise profits for shareholders. The Government’s holding company, known as DOHL, has a proven track record of picking up the pieces after private sector failure, transferring services to public operation smoothly and without disruption for passengers or staff, and then starting to turn those failing operations around. LNER was one of the first operators to fully restore services after the lockdowns, with patronage last year exceeding pre-pandemic levels. It has led the way on fares reform, simplifying the confusing array of ticket types and improving the management of train capacity on the east coast main line. TransPennine Express has dramatically improved its reliability since joining the public sector. In its worst periods early last year, more than one in five services—over 500 a week—were wholly or partly cancelled, either in advance due to train crew shortages or on the day for a variety of reasons. This is now down to around 500 a month.
The newly stood up shadow Great British Railways has a strong mix of skills, expertise and experience from the top of the rail industry and will be held to account by its newly appointed chair, Laura Shoaf. DOHL, whose chief executive is part of shadow Great British Railways, has previously managed the successful transfer of services, engineering functions, back-office functions and thousands of staff members. It already has work under way to bring in the additional capacity and expertise that it will need as DOHL takes on more services.
As well as delivering better services, public ownership will save a fortune. Once franchise services are all back in public ownership, where they belong, we expect that the taxpayer will save between £110 million and £150 million a year in fees which currently benefit private companies and their shareholders. Finally, public ownership will pave the way for the wider railways Bill and for Great British Railways, which will bring together track and train in a properly integrated way for the first time in three decades. GBR will have a relentless focus on meeting the needs of the passenger and the freight user, while also driving best value for the taxpayer.
While extolling the virtues of public sector operation, I also want to acknowledge the vital role that private businesses will continue to play in our railways. As now, there will be huge opportunities for the many successful and innovative businesses within the rail supply chain. The operation of rail freight services will remain in the private sector, helping to free up our roads and put us on our way to net zero. There will be a continuing role for open-access passenger services alongside publicly run services, where they bring benefits and add value to the network. In view of the dire state of public finances, it would not be responsible to bring privately owned rolling stock—trains and carriages —back into public ownership, but GBR will take a coherent, long-term approach to our future rolling stock needs, helping to secure better value from the private rolling stock market than was possible under franchising.
There was some debate in the other place about the availability of performance data to enable public scrutiny of individual train operators’ performance. However, we are not lacking in information about operator performance: there is plenty of evidence that it has not been good enough. There have been particular concerns about the poor standards of service provided by Avanti and CrossCountry, which I am happy to address head-on.
As a result of decisions made by the previous Government, the core term of Avanti’s contract expires in October 2026, while CrossCountry’s expires a year later. We cannot bring these contracts to an end before those dates unless the relevant contractual conditions for early termination are met. So the Government will continue to monitor operators’ compliance with their contracts closely; the Secretary of State, as passenger-in-chief, has made clear that she will not hesitate to take further action where appropriate. Ministers have already met Avanti and CrossCountry and their Network Rail counterparts to challenge them on poor performance and demand immediate action to deliver improvements. The Secretary of State has also put in place a formal remedial plan for CrossCountry.
Noble Lords may question why we intend to bring services back into public operation as existing contracts expire, rather than starting with the poorest performers. That is a good question, but this is the right thing to do because it is the way to avoid paying compensation to the outgoing operators for ending their contracts early. Our blueprint for rail reform, Getting Britain Moving, published before the election, was clear on this commitment.
I reinforce that reform does not end with the Bill. This is just the beginning. As I alluded to earlier, this Government plan to introduce a wider railways Bill, which will include provisions for establishing Great British Railways. Consistent with the Secretary of State’s commitment to move fast and fix things, in advance of that Bill, she has already established Shadow Great British Railways to improve services for passengers, unlock barriers to delivery and move the rail network towards greater financial sustainability. Made up of leaders from DG Rail Services Group under DfT, Network Rail and DfT’s holding company for public sector train operators, it will signal a new way of working together to deliver a simpler and better service.
Shadow GBR will also be responsible for designing Great British Railways and will play an important role in improving the reputation of the railway with customers. It will build and exemplify the culture and ways of working in rail that we want to take into Great British Railways. The wider railways Bill will be for future debate in this House and elsewhere but I dare say that noble Lords will want to express some of their views on these matters today. I welcome those contributions. We are keen to ensure that we take the time to hear and understand views from interested parties, including noble Lords. As we refine our detailed plans for the wider Bill, I am sure that the Government will have more to say about these plans in the weeks ahead.
To conclude, this Government will put our rail system back on track to deliver for passengers and support our growth and opportunity missions, with clear strategic direction and proper integration and co-ordination. This Bill presents an unprecedented opportunity to begin reforming the railways in such a way that it will benefit generations to come. The passenger and the taxpayer have for too long been at the mercy of the private companies that operate our railways. This Bill is the first step in ending the decades of failure that have become synonymous with rail travel in this country. There is much to be done; once up and running, Great British Railways will be able to put the passenger and freight user front and centre, seizing opportunities for renewed economic growth, innovation, accessibility and a sector that we can be proud of. Public ownership is a vital ingredient in our plan to fix our railways. I beg to move.
The Earl of Effingham (Con)
My Lords, a recent KPMG survey of more than 1,300 CEOs globally in 11 key markets and industry sectors revealed that nearly 80% of those CEOs believe that hybrid employees will return to full-time office work by 2027. The survey covered companies with annual revenues of over £375 million, with one-third exceeding £7.5 billion. These are companies with large workforces. Amazon’s recent policy decision is a good example of the return to the office. The momentum towards in-office work will only increase; that is just one reason among many why it is essential that we have a rail system that works for everyone, regardless of where they live or what they do. A thriving railway is a crucial tool for driving prosperity across Britain.
It was 31 years ago that the Railways Act enabled the private sector to run franchised passenger railway services. For this Bill now to make provision for those services to be provided by public sector companies represents seismic change and will need line-by-line parliamentary scrutiny—not least in this House, where there are so many experts in the field and we can deliver a platform for passengers from which growth and success can flourish with a gold-standard railway network.
It is not in dispute that there is urgent need for rail reform. The current franchising model is not working. Passenger services are not at the standard they need to be and, post pandemic, the sector is a burden to the taxpayer. The country wants change and we have cross-party support, but that support is for the right change. Nationalising train operating companies is not necessarily the correct answer; it throws up as many questions as it does answers.
I shall first address service reliability and availability. From April 2023 to March 2024, there were 7.6 million delay compensation claims closed by the train operators —a 30% year-on-year increase. What benchmark will the Government set themselves for 2025-26, when the first franchises will come into the public sector, and what year-on-year improvements in compensation claim reduction will the Government commit to for the first five years of operation? Between April 2024 and June 2024, only 70% of recorded station stops in Great Britain were arrived at on time. This compares with circa 92% in Switzerland and 88% in France. So what benchmark will the Government set themselves for 2025-26 and the ensuing years?
Just recently, the European Commission confirmed in a study of its own the benefits of competition in passenger rail. Prior to the pandemic, the railways ran more than 21,000 services on an average day, which represented a 30% increase to that before privatisation. By what year will the Government commit to providing that same level of service to passengers?
Moving on to infrastructure investment and cost benefits to both taxpayers and passengers, which are essential to the success of this project, government investment in the sector has quadrupled since privatisation and in recent years we were successful in winning around £1 billion a year of investment from private funding. To provide a truly great service for passengers, the sector must have continuous investment, so I ask the Minister to confirm what funding agreement she has negotiated with His Majesty’s Treasury to ensure that the money is there. How much has she agreed will actually be available? It would also be interesting to know why rolling stock companies are not being nationalised so that the Government could achieve vertical integration to increase efficiency, reduce costs and boost control, all of which will benefit the taxpayer.
Train operators were net contributors to the Exchequer from 2010 to 2018 but fell into deficit after 2018. The impact of Covid on the sector has been devastating and it now costs the taxpayer £2.6 billion to cover the day-to-day running of train operating companies, which contrasts markedly with the £373 million in day-to-day running costs in 2019 and 2020. If we assume that the move back to the office continues in line with the KPMG survey, we can hope that day-to-day running costs will decrease for the taxpayer in correlation with increased footfall on the train network, but, for clarity, that cost benefit reduction will not be due to this Bill.
The Government have said that the Bill will save the taxpayer millions of pounds so, under the proposal, the management fee and performance-based fee for private sector franchise train operators will disappear. However, unprofitable services are currently subsidised under the existing agreement; this will still be required under a public sector company. Not only that but the subsidy may well increase and there could be costs with franchise extensions and associated dealings. Management still has to run the railways and will be receiving a salary and, instead of a performance-related bonus, perhaps a government-backed final salary pension scheme, which could end up costing the taxpayer more than the performance-related fees. All these elements combined could be why the new Bill required a money resolution.
Rail partners, which obviously have a vested interest, will nevertheless be in possession of a mass of information. How does the Minister answer their point that full nationalisation is a political and not a practical solution which will increase costs over time? Just to reassure the many parties, including noble Lords in this House, who have concerns about the costs for the taxpayer, will the Minister explain, in rough numbers, where the cost savings will come from and what the net benefit to the taxpayer is on a yearly basis versus the current set-up, while discounting the improvement in the balance sheet from the lessening impact of Covid working-from-home policies over time?
Next, I shall focus on risk management. The Government want to remove the privately owned train operating companies that have been working the network for 31 years. I apologise, as this might seem like a basic question, but who exactly is going to replace them? Will the Government be able to find more skilled and knowledgeable staff than those already working in the sector? Will they appoint new chief executives, chief financial officers and boards of directors who will be responsible for the running of the companies? If yes, will the Minister provide a timetable for when the recruitment search will begin for the relevant key staff? How will those key staff be incentivised to control costs and grow the rail network for the benefit of passengers?
The Financial Times has also reported concerns from rail industry bosses that the scale and complexity of nationalising the remaining franchises could put pressure on the Department for Transport operator of last resort. How will the Government ensure that DOHL is sufficiently resourced to deal with this? What hiring plans have been made and what budget has been secured for the new headcount?
Finally, I come to accountability and governance. For these new public sector companies to be successful, they will need to be accountable to shareholders—the shareholders being the taxpayer. What performance, financial management and innovation metrics have been agreed by the Minister to ensure that both passengers and taxpayers are receiving value for money and will not be negatively impacted by spiralling costs in the sector due to a lack of experience, a lack of expertise or both?
In the same way that powers will be given to the OBR to make judgments on any major taxation or spending announcements, will the Minister commit to giving the same powers to the Office of Rail and Road to conduct an impact assessment for the Bill to confirm that it makes economic and operational sense and will not be to the detriment of either passengers or the taxpayer? Will the ORR also be given the authority to assess all aspects of the performance of public sector companies awarded public service contracts?
We know the Government intend to establish a powerful new watchdog: the passenger standards authority. Can the Minister explain why it is not being delivered as a part of the Bill? In the past, previous Governments have introduced temporary legislation with the intention of bringing forward additional reforms, but the wider reforms have not materialised. Will the Government take this precious chance to deliver a comprehensive package of railway reform rather than focusing solely on this interim Bill?
We have an opportunity to make our rail system the envy of Europe so please let us do it the right way, which will bear fruit for generations to come.
Lord Bradshaw (LD)
My Lords, this Bill was forecast in the Labour Party’s manifesto. We have no quarrel with the need to take drastic action to make the railways work better for passengers, freight business and the taxpayer. State-run organisations can be run efficiently, and we will help to see that they do; we will also help see that, in the case of the railways, passengers and freight users are the main focus of policy.
The Railways Act 1993 left the railway with an expensive and bureaucratic organisation where too much of the effort was focused on blaming others—as instanced by Keith Williams in his original report—for shortcomings in service provision and a regulatory structure which, in common with other privatised industries, was not fit for purpose. We hope it is the Government’s intention to review the role of the road and rail regulator, which has concentrated its efforts on promoting competition and has neglected most of its other statutory duties. The basis for calculating abstracted revenue by open access operators has not been sufficiently challenged, and the regulator’s responsibility for safety has departed without sufficient regard for the widely accepted as low as reasonably practicable principles.
The legal structure devised by the rail regulator gives access rights to operators, protected in law, which prevent the optimisation of the timetable. While it is acceptable that freight has protected status, it should be incorporated in a rational timetabling process optimising scarce infrastructure resources. In my opinion, reform of the regulatory process is essential to the success of GBR. Without control of the regulatory arrangements, it will continue to be the case that major investments—like the £4 billion being spent on the east coast route—will not achieve improvements.
It has become apparent that no one can make timetable decisions that produce faster journey times, as there are so many conflicting paths and no rational ways of resolving these conflicts. As a result, there have been no major revisions to the timetable since 1991. A revised timetable for all routes would give priority to London-bound services, after which would come interregional services and then local services. That would be easily understood and can be built into a co-ordinated whole, giving good connections throughout the railway to other rail and bus services. The control organisation supervising railway operations needs overhauling to eliminate much duplication and end the focus on the blame game, changing it to one that concentrates on failures.
Complaints are made about the rolling stock companies. We do not expect these to be taken into public ownership, although, in common with other state-owned assets, they were sold far too cheaply and largely debt free to an immature market. However, allegations about fixing the market have not been upheld and, with fresh entrants into the business, there is every reason to believe that the market will become more competitive. The rolling stock companies should have a place at the table when designs are developed, as well as the supply side of the industry and some representation from goods designers, as was the case with British Rail.
We await with interest what the Government will propose for fares and charges. We want our railway to be busier. For this to happen, we need to charge cheaper fares and provide more capacity. In many cases our trains are too full, to the extent that people avoid using them, which cannot be right environmentally or economically. We want our railways to offer a “turn up and go” capability, not one that charges high fares to travellers who have to make urgent journeys at the last minute and who face having to stand because insufficient accommodation is available.
There are a few more issues on which we want clarity from the Government, in the Minister’s reply or in subsequent legislation. I know that the Government have in their possession proposals for a modest programme of infill electrification, which would mainly benefit freight but would also bring benefits on the passenger side. This should include modest extensions to the existing third rail systems which the previous Government allowed to be halted.
Other proposals would show that the Government are looking to the future, such as electrifying the Midland main line; the work on the Felixstowe to Nuneaton route that is so sorely needed in the freight industry; and the provision of a flat crossing at Newark. This, together with the re-signalling now taking place and the elimination of wasteful paths for five-coach trains that should be formed of 10 cars at least as far as Doncaster, would create at least two and possibly three more paths each hour on the east coast main line, as it needs to build on its place as the premier route between London, the north-east and Scotland. This would not need an immediate cash handout, but the design work and preparations in the supply industries would be immediate and would let the railways know that the Government are listening to them.
Lastly, I turn to the decision made by the last Prime Minister in respect of HS2. There is simply insufficient capacity in the system to plug the gap left by this announcement, and early clarification of the Government’s position on this is necessary.
We will hear a number of maiden speeches, to which I look forward, including one from the noble Baroness, Lady Pidgeon, who is an expert on transport. I hope we shall listen to them all.
Lord Liddle (Lab)
My Lords, I welcome my noble friend Lady Blake to the Front Bench and congratulate her in leading the Second Reading of this Bill so well. In my view, she has a lot to contribute to transport. After years of experience as leader of Leeds City Council, she saw at first hand how, over the decades, we have grossly neglected public transport investment in our metropolitan areas outside London. This must change, and I hope it will change under the Labour Government.
I support the Bill. I have no ideological bias in favour of public ownership. My bible as a social democrat many decades ago was Tony Crosland’s The Future of Socialism, which totally persuaded me that there was no virtue in public ownership per se. Therefore, these issues have to be addressed in a pragmatic way. I was always sceptical of rail privatisation. The general argument for separating the natural-monopoly elements of business from the operating elements is a sound one economically; it works in telecoms, for instance, where the infrastructure has vast capacity. But that is not true of the railways. There is not infinite capacity in the natural monopoly, and someone somewhere has to decide which services get priority and which do not.
If I might say so, I thought that the noble Lord, Lord Bradshaw, gave an excellent speech in which he outlined some of the major failures of the 1990s privatisation. The railways need a guiding hand, and on this side of the House I fully supported the conclusions of the Williams review. If I might put it this way, it was a bit rich for the noble Earl, Lord Effingham, to say that we want to see the comprehensive reform of the railways. The truth is that his Government sat on the Williams review for five years and did very little about it, because some Back-Benchers thought that it sounded a bit too socialist. I think he should recognise that Labour here is trying to pick up from the mess that the Conservative Government have left.
Some people will say that, yes, they support the Williams review but it does not necessitate public ownership throughout the system, that we lose the benefits of competition, and all that. As someone who has now been a Member of this House for getting on for 15 years and has gone up and down the west coast main line virtually every week, I must say that we had a reasonable service with Virgin, but we have had a disaster with Avanti. I do not understand how anyone can think that this has been a good example of the private sector contributing to public service.
In fact, since Covid, we have not had a competitive railway in any sense. What we have had is the most centralised system of management of the trains in recent times. The Department for Transport lays down the costs for every service and the Treasury collects the revenues. The franchise operators have very little incentive to make any improvements of any kind; all they want to do is collect their fees. We need a fresh start and I think that this Bill gets us part of the way to it.
The only part of my noble friend’s great introduction to this Bill that I paused at was her announcement that we might have to put up with two more years of Avanti. I would like to know why. Can we please see what the contract is that the Government feel they cannot withdraw from? Can we see what performance standards the last Government set for Avanti and whether they are being met? As a Government, let us not hesitate too much about taking drastic action. I know that my noble friend Lord Adonis, when he was Transport Minister in 2009, was advised by the department and its lawyers that it was quite impossible to take LNER into public ownership at the time. He said, “Well, what’s the risk that they’re going to sue?”, and went ahead with it. I cannot see the public rushing to support Avanti if it is deprived of its franchise.
I have some detailed points on the Bill that I think are important and on which I hope we can have a decent discussion in Committee. They are concerned mainly with new Section 30C, on the definition of what kinds of public service contract and public service company are allowed to operate on our public railway. One of my concerns—it relates to what I said earlier about my noble friend Lady Blake and her experience in Leeds—is whether combined authorities and mayors would be able, under the remit in new Section 30C, to run services in their metropolitan areas. It would be a shame if we had in our minds the wonders of the British rail model of the past, because I do not think that it was very wonderful. We need a much more decentralised structure for our public railway, and we need to find the mechanisms to make that decentralised structure work.
My second point is that I do not see any ideological objection to public/private partnerships in running the railway. Let me give an example. You might have a situation where a private company was prepared to commit to electrification plans for a particular line that would not be in the public sector investment plan. My view is that we should allow public/private partnerships on a net additionality rule. If they are going to bring more investment into the rail system, what on earth is the case for not allowing them to do so?
With those points, I say that it is clear that this is a good start—but it is only a start. The whole scheme of reform has to be worked on very hard by the department and its Ministers in the coming months, but, in the meantime, I welcome the Bill.
Lord Young of Cookham (Con)
My Lords, it is always a pleasure to follow the noble Lord, Lord Liddle, who was the opposition spokesman in your Lordships’ House in the last Parliament and therefore may have played a role in the conception of the Bill—although sadly he has been denied any part in its delivery. I am grateful to the Minister and her colleague, the noble Lord, Lord Hendy, for the briefing they gave to noble Lords during the Recess, and for the exposition from the noble Baroness of the reasoning behind the Bill.
You wait a long time for an ex-Transport Secretary and then three of them turn up at the same time. I look forward to the maiden speech of my noble friend Lord Grayling, who has held two of my previous jobs, Transport Secretary and Leader of the House of Commons. I was also briefly one of his juniors when I was a Minister in your Lordships’ House and I enjoyed working with him. He brings with him a wide range of ministerial experience to reinforce the Opposition Benches in your Lordships’ House. I also look forward to the maiden speech of the noble Lord, Lord Cryer, and the noble Baroness, Lady Pidgeon.
Turning to the Bill itself, the Government have inherited a complex set of challenges with the railways after the pandemic bust the franchising model. It simply overturned the industry’s finances, upended travel patterns and has led to increased and unsustainable taxpayer support. However, in moving to the more sustainable system that we have heard about this afternoon, it is important not to throw out the baby with the bathwater.
The structure which I hoped to put in place in the 1990s had three key benefits, all of which we risk losing. It took investment in rolling stock off the public sector balance sheet and created a market of train operators to replace a public monopoly, and its business model forced the industry to look outwards towards its customers, not inwards to the sponsoring department, leading to inbuilt incentives to grow the market. With that new structure, private operators reversed decades of decline in passenger traffic. It helped to double passenger numbers, increased services by a third and turned an operating deficit under British Rail into a surplus for taxpayers, paying a dividend of £3.8 billion to the Treasury from 2010 to 2019.
By contrast, the Sunday Times told us yesterday that the subsidy for Southeastern, which is now in the public sector, is four times what it was prior to the pandemic, when it was in private hands. Passenger safety improved after privatisation and closed branch lines were reopened. We need to put those facts into the public domain while we debate the future of the railways. It seems to me that the challenge before us is to try to retain those advantages within the new structure.
I will take them briefly in turn. First, on the public sector balance sheet, I had the benefit of negotiating with the Treasury for investment in the railways both before and after privatisation. Before, I would go along to a Star Chamber composed of colleagues who I thought were my friends but turned out not to be, and I made the case for investment in rolling stock as best I could. They would say, “George, we’re really interested to hear from you, but we’ve just had the Secretary of State for Defence, who wants more soldiers, we’ve had the Home Secretary, who wants more policemen, we’ve had the Health Secretary, who wants more doctors and nurses, and we’ve had the Education Secretary, who wants more teachers. Politics is about priorities and we’re very sorry, George, you can’t have your new train set for Christmas”.
After privatisation, there was no dialogue with the Treasury at all about investment in rolling stock. The capital markets responded to the business case that I made, and we got the investment which we needed. That is one benefit that we are about to lose, given the path on which the Treasury and the Government are now embarked.
The franchising costs of the operators now run by the DfT score as public expenditure. At the moment, those franchises do not have much time to run, so the sum is relatively small, but when GBR is up and running all rail investment will score as public expenditure; that is potentially £13 billion which the Government do not have to find at the moment. Amazingly, if you look under the heading “Financial implications of the Bill” in the Explanatory Notes for the Bill, you will see that there is simply no mention of that whatever. Nor in the other document, Final Stage Impact Assessment, is any mention made of that under the heading “Impacts on government priorities”. But any spending Minister knows that, when he looks at his or her capital budget, it is crucial whether that investment is public expenditure or private. If the Transport Secretary is unsuccessful against the bids for doctors, nurses, policemen and teachers, there are implications for the reliability of services, which we have heard about, and for the supply line, which the Minister mentioned—that is, those who supply the rolling stock in this country.
The second advantage was to bring in other successful transport operators—people who run bus companies, airlines, shipping or successful operators from overseas. Their skills were applied to running the railway and so break the British Rail monopoly. If British Rail was not as good as Ministers felt it ought to be, there was nothing we could do about it; there was no one else who could run a service. Privatisation created this new market of train operators bidding for franchises; many good people within British Rail moved over to the new train operators, and welcomed the freedom that privatisation had given them, particularly the freedom of manoeuvre that came with it. Just as other European countries are moving over towards the model that we now have, this country is taking a backward step to a public operator with an outright prohibition in the Bill on the use of private contractors.
The structure which we chose also avoided national strikes of train drivers. Each individual franchise operator negotiated individually with the trade unions and, by and large, they reached agreement. National bargaining with a single employer, as proposed, could mean that any future pay disputes have a greater impact on passengers. Others may talk in this debate, or certainly in Committee, about the implications of employment changes for the thousands of railway workers who now work for the train operating companies who will move over, presumably to a single contract at some point within GBR, with all the implications that has for negotiation for the workforce.
The third innovation was an incentive to grow the market, to look outwards towards the customer. Once a company had won the franchise, the only way that they could increase its turnover and profit was by winning more customers. But when I was Transport Secretary, it made little difference to British Rail whether it had more customers or fewer; it just meant it got more or less subsidy from the Secretary of State. Franchising created that incentive to look outwards at the market, not inwards towards the department. By contrast, the new contracts introduced by the Government leave operators with little commercial freedom or ability to help growth—a point touched on by the noble Lord, Lord Liddle. Given the financial challenges facing the Government, it is counterintuitive to ban the only part of the rail system with a track record of driving growth and reducing subsidy for taxpayers. Nor is public ownership a panacea for all the problems —passengers mind about performance and price. Over half the delays in the system are caused by Network Rail, which has been in the public sector for two decades. On price, is the Treasury going to find the money to keep rail fares down? It is just worth remembering that, on privatisation, rail fares were capped at RPI minus one, a policy that was reversed by the incoming Government.
A final word about fragmentation—a word that was used a lot by the Minister. The final impact assessment says that the Bill aims to reduce industry fragmentation. A common criticism of privatisation is that we have ended up with an industry that is fragmented and should be brought together. I understand that argument, but it should be treated with some caution. The most popular and safest form of public transport is by air, yet you could not find an industry that is more fragmented. The airlines do not own the aircraft, they do not own the airports, they do not run the national air traffic system, they do not do the baggage handling or the catering. Some airlines do not even employ the pilots but get in self-employed pilots. I prefer to use “specialised” to “fragmented” in describing a transport industry. I challenge the assertion that an industry which is fragmented or specialised is less efficient than an integrated one.
The Bill will probably go through but, as a political midwife, I hope that the Government will see whether some of the progeny of privatisation might be saved.
Lord Faulkner of Worcester (Lab)
My Lords, it is always a pleasure to follow the noble Lord, Lord Young of Cookham, whether on this or other subjects where he and I have an interest. I extend my thanks to him for the help that he gave to me and my co-author in putting together material on the privatisation in one of three books on railways and politics. In one of them is a very fetching picture of the noble Lord and his family taking their cycles by train and promoting the railway. I am grateful to him for that. I have two current interests to declare, as chair of the Great Western Railway stakeholder board and as president of the Heritage Railway Association.
I welcome the Bill for one reason above all others. I hope that its appearance so early in the parliamentary Session demonstrates the scale of the Government’s commitment to the railway and their determination, not influenced by political dogma, to ensure that the railway plays a greatly enhanced role in the nation’s transport system and is again, in the words of the noble Earl, the envy of Europe.
When the railway was privatised back in 1993, it was intended by the then Government to break the BR monopoly—as the noble Lord, Lord Young, just confirmed in his speech—and to create a framework for competition to drive efficiency. That never happened. It ignored the fundamental truth that railways are not a competitive sport but a team game, requiring the seamless co-operation of many players to work together properly and efficiently. A competitive structure overseen by lawyers, regulators and civil servants is not the way to run an efficient railway attuned to the needs of its passengers and freight customers.
Reconnecting train operators and infrastructure management under a single organisation should bring efficiency in how things are planned, apart from avoiding the expense of lawyers and delay attributors. I welcome the establishment of Great British Railways, in shadow form at least, and congratulate Laura Shoaf on her appointment as chair of the shadow body. She has a great track record in the West Midlands; I wish her well in her new job.
The creation of GBR also gives us the chance to restore some financial and economic disciplines that have not been a feature of the present set-up, and that cost so much more than British Rail did. It is a difficult balance to strike, not least because the playing field in transport has been so uneven. Successive Governments approved the annual increase of rail fares above inflation almost every year in recent times, while in contrast the annual fuel duty escalator has not been used since 2011, so motorists have received tax breaks over almost 13 years. Subsidies for electric cars have encouraged a further shift from public transport to driving. This is not a war on motorists. If anything, it is the disadvantaging of the most fundamental and important element in the transport structure.
It is not just with road users that the railways find themselves competing on unfair terms. By far the most polluting and environmentally unfriendly form of passenger transport is domestic aviation. In a report published by the think tank Transport & Environment UK last month, it was shown that, if a fair equivalent to the fuel duty paid in other sectors were applied to domestic aviation, up to £6 billion a year could be raised. Had High Speed 2 not been progressively scaled back and that railway built to provide a new fast intercity service, particularly to Glasgow and Edinburgh, there would have been a genuine modal shift from domestic flights to the high-speed railway, as has occurred in all the European countries that have had the foresight to build a high-speed rail network.
Even without HS2 going to Newcastle and Edinburgh, there has been a large modal shift to the railway. Pre-Covid, the proportion travelling by rail from London to Edinburgh was 35%; the latest figure today is 57%. Much of that growth has taken place on LNER, and I congratulate it, but the introduction of open-access Lumo services has also played a considerable part.
During the privatisation process, no thought was given to how the social benefits provided by the railway would be paid for. Back in the day, BR understood these benefits and how to offer them as part of the service for which it received the passenger service obligation grant. Busy trains provide low-carbon travel, with emissions even lower when the train is powered by electricity. They reduce traffic congestion and pollution by reducing the number of cars on the road. They can be part of a different lifestyle, encouraging people to walk to the station or use the bus, rather than avoiding exercise by taking the car from the house without walking at all.
Trains connect people and reduce the problems that are experienced in remoter parts of the country. We have already seen how communities such as Okehampton have benefited from being reconnected to the network: passenger numbers are more than twice those forecast and there have been huge benefits to local society. Trains are safer than hazarding your life on the road network, where 1,700 people die annually still. The standards applied to road design and accident investigation are weak and way behind the focus on safety that is a central part of railway culture. Trains are a lifeline for young people who cannot afford private transport or do not want to pollute by using cars or aircraft. They are also essential for the elderly and particularly those who should no longer drive, even if they cling on to their cars.
Despite some problems at older and smaller stations, the railways have opened up a much better lifestyle for those with impaired mobility. One of the biggest changes in the last 20 years has been the large increase in the number of people travelling in or with wheelchairs or who are receiving assistance at stations. Privatisation made no financial provision for these benefits and, unsurprisingly, the private companies were not able to provide all of them without some financial support.
Train services are not like a standard commodity, such as buying soap powder or a tin of beans. They are a careful compromise between providing the best service possible with perhaps 200 different preferences by the passengers who use them. They are also a compromise between fastest journey time or high frequencies and best connections with other trains and other forms of transport.
Contrary to what was believed back in 1993, competition has always been between modes, rather than between train operating companies. For almost the whole period since privatisation, the railways have been working in a difficult environment with constant changes in demands by previous Governments and micromanagement by civil servants. To their credit, the better train operators have managed to make this complex system work and, particularly pre-Covid, tried to improve journey times, provide enough rolling stock for a growing number of passengers and build positive relationships with rail user groups, local authorities and local bus companies. They have been able to draw on funds to help achieve local improvements through initiatives such as the customer and community improvement fund.
Open access operators have, as my noble friend the Minister made clear, been left out of the scope of the Bill. This is sensible—the numbers are small, but they fill a gap in the network that was never filled though franchising. Similarly, heritage special train operators, including those using steam locomotives on the main line, are not covered, which will be a great relief to them given the substantial regulatory burden that they already have to take into account and the significant operating challenges they face, particularly at the moment in sourcing coal for their locos.
I agree that the rail freight operators are best left as they are, but some direct support by government might be required to provide rail freight terminals where they are needed, and there needs to be protection from predatory pricing by juggernaut operators, particularly where overseas companies pay no vehicle excise duty and avoid fuel duty by filling their tanks abroad.
Decarbonising road freight is a huge problem, but on rail it can be achieved relatively easily through extension of electrification and other sustainable forms of traction such as battery power. Getting traffic off our roads and on to the railways is absolutely the right thing to do from an environmental standpoint and is massively popular with the public as well.
Opinion poll surveys show substantial support for the Government’s nationalisation proposals, provided that they are not accompanied by huge fare increases. One of the most important and welcome changes will be an end to the present wholly unsatisfactory arrangements where the Treasury is in control of tactical policy and minimising costs is the primary objective. There needs to be an understanding across government that railways are an opportunity, not a problem, and are an essential part of any national growth strategy.
We look forward to the second railways Bill next year to complete the transformation and to put railways at the heart of the nation’s transport infrastructure. Meanwhile, I welcome this Bill and I congratulate my noble friend Lady Blake of Leeds on taking charge so well today, and I look forward to working with her and with my noble friend Lord Hendy of Richmond Hill during its later stages in this House.
If the House will indulge me, I will conclude with the final words of my third book on railways, Signals Passed at Danger, which I referred to earlier and which is available in all good bookshops. My co-author and I wrote:
“The railways’ capabilities are manifest when the management of the railways is restored to those competent to operate them, with a clear strategy and funding agreed to deliver the outputs of that strategy”.
Let us hope that the Bill is a first step towards achieving that.
Lord Grayling (Con) (Maiden Speech)
My Lords, it is a great privilege and honour to make my maiden speech in this House, having moved up the Corridor after 23 years on the green Benches, and to do so following two distinguished figures in the transport world, the noble Lords, Lord Faulkner and Lord Young. As the noble Lord, Lord Young, said, he and I served together briefly during my time in the department; he knows a huge amount about this subject. It is a particular pleasure to do so sitting alongside my noble friend Lord McLoughlin, who was the formidable Deputy Chief Whip when I arrived in the Commons as MP for Epsom and Ewell in 2001, who became a good friend sitting alongside me in Cabinet and was, of course, my predecessor as Secretary of State. In many ways it is also a relief to be here, because I have the privilege and honour of having been the only person to serve as both Lord Chancellor and Lord President. That meant that I was constantly introduced at events as “Lord Grayling” and spent quite a lot of time explaining to people that I was not. It is a relief, having arrived here, that I now am.
I would like to express my thanks to all of those who have assisted me in my first few days in this House—in particular to Black Rod and her staff, to the clerks, doorkeepers and members of the House staff who helped me with my introduction and with getting used to this place. It was a particular pleasure to have two very old friends as my supporters when I was introduced: the noble Lord, Lord Goodman of Wycombe, who was elected to the Commons on the same day as me in 2001, and the noble Lord, Lord Sharpe of Epsom, who has the misfortune—or fortune, depending on your view—to have been introduced to the Conservative Party by me in our mutual home area of Epsom.
It is a particular honour to be appointed to this House, and one I shall always be grateful to the former Prime Minister Rishi Sunak for. In my last few years in the Commons I focused particularly on two issues, and I hope to do the same in this House. The first is international conservation, something I am very passionate about, which in my view is crucial to the future of the planet and of mankind, and also to the future of the aviation sector in this country, which is the other area I have focused on particularly. To some people there may appear to be a contradiction between those two things, but an end to aviation would mean an end to the tourist trade, which eases poverty in so many places and, in particular, is so vital to supporting and sustaining conservation efforts around the world. If there were no tourists, much of the conservation effort in the developing world would not be there. It is my intention to continue to work in these two areas in this House. In particular, I am looking forward to being part of the debate on the sustainable aviation Bill. I am very grateful to the Government for having followed the work that I and others did in the Commons before the election in looking to bring forward that Bill quickly. I urge them to get on with it; it is extremely important.
As a former Lord Chancellor, I very much recognise the need to uphold the rule of law in this country. It is one of the things that makes us strongest as a nation. It is one of the things that has created one of the world’s most highly regarded legal systems. In this House I see one or two familiar faces from my time as Lord Chancellor. I should also say that it is the role of this House and of Parliament to challenge and sometimes disagree with the view of the courts. That constructive tension lies at the heart of our democracy. It is part of the strength of our democracy, and it should never be lost.
As a former Lord President and Leader of the Commons who co-chaired, with the noble Baroness, Lady Stowell, the first Joint Committee on the restoration and renewal programme, I also intend to play an active part in pushing for us to get on with that. It is far too many years since we started that process. I find it very frustrating that eight years later we still have not made progress. It is vital to the future of this historic building. We are all guardians of an essential piece of our history here, and it is our duty to make sure that it is sustained, maintained, improved and protected for future generations. We must do that.
As a former Secretary of State for Transport, I could not pass up the opportunity to make my maiden speech in today’s debate. I am very pleased to see the Minister in her position. We know each other well from my time in government when we debated the future of transport in Bradford. I very much hope that her time in government will lead to real work. Bradford is a great city that needs better transport links, which I wanted to see and was moving towards trying to achieve. She was part of the review process after the 2018 timetable issue, and I was always grateful to her for the work she did then. Of course, she and the noble Lord, Lord Hendy, are now going to have to deal with the challenges of overseeing an industry in which somehow it is always the Minister’s fault if something goes wrong. I particularly remember being blamed by one of the unions, which called for my resignation after a freight train derailed in the morning peak, causing massive delays in south-west London. I am afraid that kind of joy lies ahead for her, and I do not think these reforms are going to take away the reality that the buck still lands on the Minister’s desk, however much they might wish to change that.
Clearly there are disagreements across this House and the other House about the best way forward, though I think there is no division between us about the fact that franchising has run its course in its current form, or rather the form that it existed in before the pandemic. Change was needed, which is why I commissioned Keith Williams to do his review. Whether the approach the Government are taking is the right one is a different question, because—I have to say to the Minister—I do not believe that the issues on our railway today are about ownership. The reality is that the people who have been running the railways are going to be the people running the railways in future. The issue is all about capacity and constraints. Frankly, we have had too many trains on too little space, and it just does not add up. Trying to get many trains through our busiest junctions at peak times has been an impossibility. It is what has caused so many of the delays, and that is what is going to carry on happening. Ultimately, if the Government are to deliver what they say they are going to deliver, they will have to invest in extra capacity as well.
The second issue is that, as the noble Lord, Lord Young, said, renationalisation brings the railway back into competition with other areas of government at Budget time. Ministers must not close the door to private investment in the railways. If they do, they will find that services do not improve, costs do not come down and capacity challenges remain. If they shut out the private sector from the railway, in my view they will come to regret it. But that is all for another day. The debate will continue, not just on this Bill but on the Bill that the Minister has said will come before this House, and the House of Commons, in due course.
I finish by reiterating that I regard it as a huge privilege to be here, and it is good to be alongside many friends on different sides of the House. I very much look forward to taking part in debates here in future. It is an honour and a privilege that I am very grateful to have been given.
Lord McLoughlin (Con)
My Lords, I declare my interests as set out in the register of interests, as chairman of Transport for the North and as a board adviser to Xrail. It is a great privilege to follow my noble friend Lord Grayling; I congratulate him on such a splendid maiden speech.
We were both appointed to the Cabinet in September 2012. Because it was an unexpected reshuffle—or one that had been kept quite quiet—I was told that we could not act in our positions until we had our seals of office. Of course, we were to receive our seals of office from Her Majesty. I was told that she was in Balmoral, while we were in London, and she was not coming to London—so we found ourselves making our way up to Balmoral one Monday morning, and having a Privy Council meeting there.
I was given my seals of office as Secretary of State for Transport first; they were in a very small box. Following me was my noble friend Lord Grayling, who had become Lord Chancellor. After he took his oath, Her Majesty looked at him and said, “Your seals of office are over on the side there. You can pick them up yourself; they’re too heavy for me to lift”. That was a very special occasion for us both. Unfortunately for my noble friend Lord Grayling, he then had to pick up all the mistakes that I had made in my four years as Secretary of State for Transport because he followed me into that position. I hope I did not leave him too many problems, but I certainly left him a few. With that story, I welcome him to the House, congratulate him and commend his speech today.
So that is three ex-Transport Secretaries almost in a row, as the old saying goes. As my noble friend Lord Young pointed out, because of the problems faced by the rail industry we perhaps forget what it was like pre-privatisation; that sometimes needs to be taken into account. There were approximately 700 million passenger journeys a year then. After privatisation took place, in the year before the pandemic, there were 1.8 billion passenger journeys. After what had happened before, you would not want to spend any time at places such as St Pancras, King’s Cross or London Bridge stations. They were horrible, dingy places. Transport had not been ignored by the Government but other priorities, such as health, education and defence, got more of a hearing from the Exchequer. It worries me, and the Government have to guard carefully against going back to that position.
I accept fully that this proposal was in the Labour Party’s manifesto and that it is therefore going to happen. However, we have not yet seen the main railway Bill, and will not do so for a little time yet. There are a number of questions to be asked about that because the balance between freight and passenger and the accessibility of both the freight industry and passenger transport—this was referred to in a way by the noble Lord, Lord Faulkner—is going to be an important one.
I have always thought there should be a guiding mind for transport who is accountable. I thought that it should be mine because then I would agree with what I have been saying, but I assure the Minister that any guiding mind is still going to have to use the same capacity on the railways that we have today. That is one of the biggest issues. It was of great regret to me that the previous Government, in cancelling the second part of HS2, made a big mistake. HS2 was never about speed; it was always about capacity on the network. If we want to see more people travelling on our railways and more freight on our railways, we have to increase capacity. That is a key issue but this Bill does nothing at all in terms of capacity on our network. It talks more about the mechanics, but they will still have to use the same facilities that are required now. That will be one of the biggest challenges for the Government.
There is also the question of the transfer of liabilities. When we see the final Bill, it will be fascinating to see what happens in relation to transferring liabilities of pensions and different salary costs across the whole industry. It is interesting that, while we in this country are eventually going to go back to a single operator, in Europe, countries such as Spain, Italy and France are embracing on-rail competition between operators and competitive tendering to increase services, deliver newer trains, grow passenger numbers and reduce subsidies. Perhaps they looked at what we saw happen in this country on the railways over a period of time: a massive increase.
One of the reasons why the railways have become a lot more politically controversial, in a way, is that many more people are using them. Since the pandemic, we have seen quite a big change in the way in which the load of passengers is changing over the week. There is now a lot more use of the train service by passengers at weekends. Part of the problem is that, with the oldness of our railway infrastructure, any Network Rail engineering works taking place tend to be done on weekends because that used to be the time when fewer passengers were using them. That is not the case any more; it is one of the issues that will have to be addressed. There are still a lot of unanswered questions as far as both this Bill and the later one that we are told will come sometime next year are concerned. We need to see how the latter will address some of these issues, in particular investment.
The other area where the UK is changing is greater devolution to our regional cities. There will always be issues in terms of the big intercity lines: the line that goes from London up to Scotland; the line that goes from London to Manchester and on to Scotland; the line that goes down to Wales; and the line that goes down to the south-west. Those will always be of national significance and where the Secretary of State will perhaps want to have the most input, but what about local services in the West Midlands, in the city regions and in Manchester, Liverpool and Newcastle, where much more devolution has taken place? How do we involve those devolved authorities as well? That is going to be one of the most important parts that we have to address.
Overall, we have seen huge investment take place in our railways. My noble friend talked about his involvement in the restoration of the Houses of Parliament and wanting to see that work. I came across an interesting fact at the weekend: when Sir Charles Barrie first got the contract to build the Palace of Westminster in 1835, he said that it would cost £725,000 and take six years to build. It cost three times that and took 30 years to build; he was dead by the time it was finished. The way we are dealing with restoration in this place, I sometimes think that all the people on the restoration committee will, I am afraid, suffer the similar fate of never seeing it completed.
However, investment in our railways is not short-term; it takes a lot of planning and a lot of pre-work enabling that planning to take place. A lot of the expense is increased if that pre-work is not done; we have seen many examples of that. This is the start of a debate; we have not yet heard all the answers from the Government. This is a manifesto commitment Bill. We will, I think, want to press much further on some of the more detailed issues when we see the next railways Bill. I know that there are two more maiden speeches coming, from the noble Baroness, Lady Pidgeon, and the noble Lord, Lord Cryer; we look forward to hearing them later.
I know how important the whole subject of good connectivity is to the Minister, particularly as far as Leeds and its neighbouring cities are concerned, and to the people for whom she spoke when she was the leader of Leeds City Council. These issues are wider. If we can move forward in a way that involves the private sector, we are much more likely to see greater investment take place. I worry about some of the implications of what is coming from the Government at the moment and worry that we will not see that private investment taking place in our transport, which, overall, has served the country incredibly well over the past 25 years in which we have seen major changes in our railway system.
Lord Tunnicliffe (Lab)
My Lords, I, too, welcome the noble Baroness, Lady Blake, to her position in this interesting debate. She is smiling at me; that is good progress.
The first question has to be this: is change necessary? I answer: undoubtedly yes. I was very close to the development of the franchising regime, not because I had a direct interest but because the railway I was responsible for at that time was but a signature away from being engulfed in it. On detailed examination, it seemed to me a piece of doctrine that somehow the railways had to be privatised. The question was: how the hell do you do it? Well, they managed to create a process of privatisation without competition. In order to make up for that, it has to be massively regulated. There is nothing the private sector likes more than gaming the regulator; indeed, in many ways, that is what has happened. In addition, there was no single mind optimising performance.
So, yes, we need change. This is the right first step, but that is all it is. It is necessary because of the upcoming franchise decisions but what is before us is incomplete for managing the necessary change in this industry. So far, we have no clarity on the mission. What is the railway for? In the document that my party produced for the election, Getting Britain Moving, there are lots of words about making a better railway but that is simply too imprecise. Simply listing all the things that are incomplete does not accept the reality that the problems of any complex organisation, particularly the railways, are the trade-offs.
The trade-offs in the railway are between capacity, reliability—both cancellations and delays—and cost. Making those trade-offs is a complex exercise. If we are to get the best out of this change, there will be a requirement to understand how to optimise and, in particular, how to contribute to the various missions. Clearly, the contribution has to optimise growth, since growth and efficiency are necessary for the future of this country, but, if we simply optimise growth, we miss out two other important areas.
The first of those is levelling up. If you take the railway as it is now and ask it to optimise growth, you will almost certainly end up spending your money in the south-east and around London. A particular criterion—a particular political statement—will need to be made that biases investment away from the south-east towards early investment in capability to allow levelling up to take place. The second area is the whole issue of social benefit. In this country, we must recognise that part of government’s role is to look after the young, the old, the sick, the poor and those who live in disadvantaged places, particularly the problem of urban areas. Maximising social benefit, the levelling-up agenda and the growth and equality agenda all have to be offset against one another and optimised. To do that, there has to be much more clarity in the decision-making processes.
If decision-making processes are not clear, you get drift—a lack of responsibility and focus. The new Bill must be much clearer about those processes. I hope there will also be a recognition that making each decision on its merits simply is not good enough. My railway was relatively small compared with the national railway, but the number of decisions one had to make was enormous. We overcame that only by developing a process of criteria-driven decision-making, where we had a big debate at executive level and then at board level on how to trade off the various forces and areas of improvement that were necessary.
Crucially, the next Bill has to have clarity about the mission. Part of that must be a relationship with other areas of public transport. It is particularly important that, when we concentrate on the railway, we do so in an environment where the other modes are considered—in particular, that all too often under-supported and valuable mode called buses.
I do not ask the Minister to answer any of the questions that I pose, but I hope she will recognise that there are much more difficult decisions to be made on the next Bill, and that we can discuss it at that high level of criteria, focus and relativity. I hope that we will not fall back on giving Ministers powers to decide. We included those things in the Bill, and it has very significant government involvement. Perhaps we could even have some pre-legislative scrutiny and certainly debate. All I ask for from the Minister today is an acceptance that we have to work on these difficult strategic issues for the railway. We need to know how the Government plan to address these issues and it is essential that Parliament is involved in them.
Baroness Pidgeon (LD) (Maiden Speech)
My Lords, it is an honour and a privilege to speak in your Lordships’ House for the first time. Over the last few weeks, I have taken time to listen to and observe the House at work. I have been impressed by the quality of debate and contributions from all sides on matters as diverse as prison reform, the ongoing situation in Sudan and cycling, as well as in this debate.
I place on record my thanks for all the help I have received while settling into my new role. In particular, I thank the doorkeepers—who continue to help me as I wander the corridors, lost—the clerks, the librarians and the catering and security personnel, as well as the party staff. I am also grateful for the mentorship of my noble friend Lady Randerson, for the support of my noble friends Lady Kramer and Lady Doocey in my introduction, and for the support from noble Lords on all sides of the House.
I bring to this House 26 years of elected service at local and regional level, having spent 12 years as a councillor in Newington ward in the London Borough of Southwark—and having been deputy leader of this inner London borough—and 16 years as a London-wide assembly member and chair of the Transport Committee, focused on improving transport and policing in our great capital city. I am a proud Londoner, and I will continue to champion our great city through my work in this place.
In one recent short debate, I was momentarily taken back to City Hall, along the river, with the noble Lords, Lord Hogan-Howe, Lord Hendy, Lord Ranger and Lord Moylan, all speaking about transport in London. While this House is new to me, many Members are old colleagues, and I look forward to working with them across the House, as we did at the Greater London Authority. Of course, I look forward to continuing to question the noble Lord, Lord Hendy, in his new role as Minister for Rail, and the noble Baroness, Lady Twycross, as Minister for Gambling—some things will never change.
I turn to the debate. My focus in any transport debate is on the passenger, not the train set. Passengers want a reliable, affordable, frequent and accessible railway service. They are agnostic about who is running it, as long as it gets them from A to B. Look at the success in London of the Overground service and the Elizabeth line. Most passengers would not see them as any different from the Underground, but they are run under a concession model by private companies and branded as public Transport for London services. Internationally, there are many railway models combining the public and private sectors. In France, Germany and Italy, railways are publicly owned, with a separation between the track and the trains. In Japan, known for its punctuality, rail is nearly completely privatised. So there is not one perfect railway model.
Back in 2011, the McNulty review claimed that many of the objectives of privatisation had not been achieved, including reducing government involvement in railway matters. In efficiency terms, benchmarking —as far as that is possible—always shows that UK rail costs far more than that of other European countries. Previous work by the International Transport Forum suggests that rail reforms in the UK did not achieve lasting improvements in cost efficiency and that competitive tendering did not achieve a reduction in train operating costs.
Although this legislation is focused on public ownership as a solution, my focus—and that of the Government, I am sure—is on driving up standards to enable more people to use our railways. The successes of devolution in London and elsewhere, such as Merseyrail, are significant. I would like explicit assurance from the Minister that existing devolved rail services will remain and, in addition, that the Bill will not prevent further metro railway services being devolved to Transport for London, or other combined authorities and metro mayors, where devolved rail can help transform regions and ensure a modal shift to public transport.
As we have heard, passengers must be put at the heart of these rail reforms, with a passenger watchdog body with real teeth established in shadow form alongside these changes to ownership. I hope the Minister will provide details on plans for a passenger standards authority. One pressing issue is reviewing fares so that they are simpler and transparent, and so that there is certainty for passengers when they travel.
I would also like to understand the Government’s thinking around the freight sector, which needs to use our rail infrastructure and is an essential part of our green transition. No one believes that the current franchising arrangements are working for passengers, particularly with so many franchises failing and now being run by public operators. The Williams review made clear recommendations some years ago to address the shortcomings, and we have all been waiting for action and legislation for some time.
Transforming our railways is long overdue, and I welcome this legislation as a stepping stone for a new passenger-focused railway. The devil will of course be in the detail, and I look forward to working on this over the coming weeks, just as I look forward to my future work in this House.
Baroness Scott of Needham Market (LD)
My Lords, it is a real pleasure and a privilege to follow the noble Baroness, Lady Pidgeon, as she has made what I think all would agree was an exemplary maiden speech. It was concise, knowledgeable and full of interesting insights, and brought with it a passion about passengers from her experience in London—Londoners—and passengers wherever they happen to live in our country. As we heard, she served as a member of the London Assembly for 16 years, as chair or deputy chair of the transport committee. During that time, she achieved the respect and admiration of people not just in our party or the assembly but across London and in the industry. I know that her wealth of knowledge and experience will be a great asset to the work of this House. We extend our warmest wishes to her and look forward to her future contributions in this debate, on transport generally and on regional government, and, above all, still as a champion for London.
It reminded me that I made my maiden speech during the passage of the Transport Act 2000. As I look around, I see a handful of gnarled veterans of that debate—and I include myself in that. Starting off with all the nervousness that you have when you make a maiden speech, I was not helped by the Minister saying, “My Lords, we have five former Secretaries of State speaking in today’s debate”. Lord Rodgers of Quarry Bank, who was one of them, leaned over to me and said, “Well, just look at what a mess we all made of it”. He knew how to put me at my ease.
Like the noble Lord, Lord Liddle, I have absolutely no ideological aversion to private sector involvement in public services. There are instances where it can work very well, but the problem with rail, as we have seen with other services such as water, is that we end up creating a pretend market, a sort of proxy for something that does not exist, which leads to incentives for behaviours that often do no serve the public well, as either taxpayers or passengers. I think that the noble Lord, Lord Tunnicliffe, had it when he described it as “gaming the regulator”. A lot of that goes on—and the fact that four services out of 14 are now run by the Government as the operator of last resort is a testament to that.
As far back as 2018, as we have heard, many in the industry were calling for a total rethink of the franchising model that had been established in 1993, and that included the operators themselves. I think that there is widespread agreement that change is needed but, unfortunately, what we do not seem to hear, other than in today’s Bill, is a vision for what that change might look like. There is an opportunity here to explore, as we go into Committee, what other options might look like.
We have created a tangled web of different players with planning, delivery and oversight powers in the railway, which has led to a system that in some cases has given passengers a woeful experience. The interfaces between all those different organisations have caused expensive inefficiencies and a real lack of transparency, as we heard from my noble friend Lord Bradshaw. However, there are good operators. I am fortunate enough to live in an area served by Greater Anglia, which is one of the very best in the country. Ironically, it is one of the first that will go under the terms of the Bill.
I think that we all agree that there should be a clear and coherent plan for the railway in which it can operate effectively as a mode of transport but also deliver wider objectives such as economic development and net zero. The “guiding hand” principle underpinning Great British Railways is the right idea and commands widespread support.
But surely it would have made sense to have established that first, then allow the experts within it to determine the best way of delivering its objectives. For example, they could recommend other models of private sector involvement such as the concession model, which, as we heard from the noble Baroness, Lady Pidgeon, has worked very successfully in London on the overground and the Elizabeth line. Putting this Bill first has closed off all those options.
It is quite hard to judge the four clauses in the Bill, because it is the framework within which it sits that will determine the extent to which it is successful, and we will not know that until we get the big Bill at some point next year. I have a lot of questions for the Minister. I understand that they will probably not receive a reply this evening, but other noble Lords have touched on the same subjects. First, I am not clear still about how the guiding hand is going to work at the same time as the day-to-day operations being run by government. Clearly, we want to be able to make sure that they are coherent and work together, but we cannot have day-to-day management sitting with exactly the same people who are making the strategic decisions; it will simply not work.
Will there still be a role for the Rail Safety and Standards Board, and how will its independence be maintained? It is interesting that in all the discussions we have had so far, nobody has mentioned safety. It is worth reflecting on how safe our railway is and what it takes to keep it so; that is something we really need to take good account of. I would also like some thoughts about the Office of Rail and Road, to which other Members have referred.
It is still not clear to me who is going to ensure fair access for freight, and devolved and open access services. I think people welcome the Minister’s commitment to keeping them, but we need to be sure that they are going to be able to operate effectively, particularly with the capacity constraints that the noble Lord, Lord McLoughlin, and others have referred to. I would also appreciate some clarity about the relationship with local government as planning and transport authorities. As the Government’s thinking on regional governance is evolving, would it not make sense, as many noble Lords have said, to think about some of them running local rail services, in the way that happens in London and with Merseyrail?
I have a few more questions. What assessment is being made of the staffing requirement for taking these franchises in house, ensuring the right mix and level of skills, from the operational to the strategic?
Currently, mainline stations are operated by Network Rail and the rest are run by the operators. How can we be sure that the essential improvements that are needed for smaller stations currently run by operators do not end up at the back of the queue? Indeed, if the noble Lord, Lord Young, is correct and the investment dries up, there might be a problem of any improvements.
While I welcome the establishment of the passenger standards authority, it will not be in place until the major railways Bill has passed. The process of renationalising passenger services will have started well before then, so how can we be sure that the voice of passengers will be heard right from the outset?
Finally, clarity about the timetable for this is essential. I understand the noble Baroness’s point about contractual obligations and having to take them in the order in which they fall, but is she absolutely sure? Public confidence in this process will be severely dented if a good operator, such as Greater Anglia, faces the axe before a terrible one, such as Avanti. I just ask her to think about that.
With a flight of fancy, 27 September next year will be the 200th anniversary of the opening of the Stockton to Darlington railway. Would it not be great to see a proper renaissance of our railways?
Lord Moynihan (Con)
My Lords, as a fellow gnarled veteran, speaking in this debate with so many maiden speeches vividly brings back the nerves of some 27 years ago. I have to say that the standard of those maiden speeches has improved significantly, as have those of the responders, and I congratulate them all.
I congratulate the Members of this House who have engaged in this Bill, particularly my noble friend Lord Young of Cookham, who made the powerful point about access to the capital markets for privatised industries and the challenges, both political and commercial, of no longer being able to access those markets. However, my interest in this debate looks at how public/private sector partnerships can and must work in this sector. My intention is to share my experience and try to inform the debate, and particularly to respond to the challenge of how we improve rail services in the devolved areas and cities, as was put forward to us by the noble Lord, Lord McLoughlin.
I declare my interest as chair of Amey, a provider of full life-cycle engineering, operations and decarbonisation solutions for transport infrastructure and complex facilities. Amey, as many in this House know, has a major involvement in the rail sector in the UK.
I thought it would be helpful to show what it takes for public ownership, when engaged with private sector infrastructure management, to work effectively, creating a classic example of future models in line with the consequences of this Bill. So I have chosen an example in Wales, where arrangements will not change from those that worked effectively under the last Government.
In October 2020, the Welsh Government announced that a franchise was to be transferred to a publicly owned Transport for Wales Rail, following significant falls in passenger numbers and revenue due to the Covid-19 pandemic. All staff, rolling stock and services operated by KeolisAmey Wales were taken over by the nationalised operator on 7 February 2021.
However, as part of the original agreement, Amey continued to be responsible for infrastructure on the core valley lines, where the South Wales Metro upgrade is taking place. In addition, Keolis and Amey continue to assist and work with the nationalised operator to provide improvement services on the franchise, such as rolling stock and ticketing services. The contract aimed to deliver much-needed investment in the Welsh network, including investment in trains, the modernisation of 247 stations, and the new build of five new metro stations, along with hundreds of extra services from Monday to Friday and a major push for extra Sunday services.
As stated by the Government, the Bill will extend to Wales and Scotland while recognising that cross-border rail services are a reserved matter. To provide more information on the project, the core valley lines network, which radiates out from Cardiff up the valleys and accounts for 155 train miles in Wales, carries 56% of all Welsh and Borders Transport for Wales passage services each day, where commuting into the Cardiff capital region is set to grow by 144% by 2043. To be busier—as the noble Lord, Lord Bradshaw, said—is the objective of all concerned. It is a working example of how the public sector can run the rail services and achieve the objectives of the Welsh Government through engaging the private sector as a delivery partner.
This summer, I was invited to address a meeting of the directors of the Office of Rail and Road. I am pleased members of that board will be visiting the Cardiff-based core valley lines project later this month to see how the model can bring sufficient benefits to passengers and all the parties involved in the running of this service; above all, how it can be safe and well regulated.
The starting point lies with the Welsh Government. They have created a clear political structure to embed their vision of a customer-centred, high-quality, safe, integrated, affordable and accessible transport network to meet the aspirations of the Welsh people, for it is they who will benefit. Transport for Wales, therefore, had to set out a clear remit, which it did; it adopted the Well-being of Future Generations (Wales) Act. The objectives of the national strategy Prosperity for All were embedded into the project, and the principles set out in the Active Travel (Wales) Act created the operating framework within which the infrastructure manager of the CVL network operates.
Transport for Wales has devolved franchising powers from the Department for Transport. The TfW procurement process for the operator of the Wales and Borders rail franchise work included the transfer of the CVL network from Network Rail to the Welsh Government. The project is interesting and unusual. It is most interesting, because it can become a case study for what the Government intend to achieve in the future.
The procurement brief is critical to the success of these projects, but it was structured around output and underpinned by the legal status of the future generations Act in Wales. Rather than a technical specification, the brief was
“better access to jobs and services, more frequent and faster services, better quality, and environmental improvements”.
It was pioneering work with Transport for Wales that required moving the core valley lines from an ageing network to a contemporary, electrified, metro-style service. Acting as an end-to-end infrastructure deliverer, manager and operator, we had to design the innovation solution, and manage and operate the new and existing assets on a day-by-day basis. The Welsh Government wanted much more than an infrastructure project. They identified the need to provide a catalyst for transforming the economic and social prospects of south-east Wales.
A major challenge was designing the project to meet the needs and challenges of the historic railways of Wales. This task was particularly demanding due to the ageing infrastructure, where historic structures along the route, such as bridges and tunnels, were too low for standard electrification methods. Traditional solutions, such as demolition or track lowering, were impractical, costly, environmentally demanding, and time-consuming. By working with Amey’s consulting division, we were strongly encouraged by the Welsh Government to develop new technologies to keep over 50 bridges in place by introducing non-live overhead cable sections to allow trains to switch to alternative multimode power capabilities, such as battery and OCS, to enable trains to transition through current-free sections, making discontinuous electrification possible. This current-free intermittent technology allowed over 50 bridges to stay in place.
This has changed how companies in the sector, such as ours, respond to public sector entities. It has led to stronger public/private partnerships. It means getting to know your client earlier, understanding the challenges better, responding to ESG issues as a priority, working closely with local communities, and putting the environment and the natural world in which we work at the top of the agenda, as in the trans-Pennine route upgrade, which the Minister mentioned in her opening speech and which will benefit our jointly beloved city of Leeds.
In response to the demand of the Welsh Government and public sector ownership, the private sector is capable of working within a contractual framework to reduce costs and carbon emissions, avoid the challenges of obtaining consents for listed structures, and provide a new model for UK railways, offering a framework for similar projects around the UK. The transfer of the CVL infrastructure from Network Rail’s ownership to being managed and operated by a private company is a UK first that combines the four key objectives of decarbonisation and energy efficiency, infrastructure resilience and safety, a nature-positive approach with full engagement with local communities, and net-zero priorities—a first which I hope will be carefully studied by the Minister and her department in the context of their plans for the future of passenger railway services in this country.
Lord Berkeley (Lab)
My Lords, I congratulate my noble friend Lady Blake on a brilliant opening speech and on her long-lost work in Leeds and elsewhere to get better transport services there, and I hope she will be able to continue to do that. It is also a pleasure to welcome the noble Lord, Lord Grayling, the noble Baroness, Lady Pidgeon, and my noble friend Lord Cryer to your Lordships’ House, and to speak among so many experts in transport. It just shows how much parliamentarians love their railways. They want to contribute the best to them and have a variety of different solutions to the present problems.
So I think it is worth starting and carrying on our discussion by reminding ourselves what the railways are there for: reliability, low fares, if possible, capacity, a reduction in delays, and of course investment. I was amused by the reference of the noble Baroness, Lady Scott, to some of the “gnarled old people” in your Lordships’ House. I am one of them: I was here before her and I recall, as she will, the creation of the Strategic Rail Authority, which lasted for two or three years. Then it was abolished, because Ministers asked the SRA to do things that it did not want to do, and there was an argument. That was 25 or so years ago and we have got to reflect on the relationship between ministerial interference and how the structure of the railway keeps having to be changed to make better use of ministerial interference—or not.
How much ministerial interference should there be? Until recently, how many Questions have we had about ministerial involvement in buses or coaches? There have been very few, but we have railway questions very frequently, and in the other place it is the same. There is a serious problem with long-distance coaches in Cornwall, where I live. One of the providers, National Express, has withdrawn a London airport service to Cornwall, which stops people going to Heathrow to catch a plane without having to take a taxi into Exeter or something. But nobody is saying “National Express should keep doing this and do they need a subsidy?” So I think we have to keep it balanced and I hope that the new structure, when we see it properly, will actually do that without throwing the baby out with the bathwater.
One of the things that has come up again and again in this debate has been what the priorities should be if there is a shortage of investment, which clearly there is. Is it local services or long-distance services? I will not mention HS2—we all know what has happened there—but there is a need for investment in many smaller railways. My noble friend Lord Faulkner mentioned one in Devon, but there are many others around the corner. It is also a question of how you judge the cost-benefit analysis of these things. As other noble Lords have said, it is extraordinary when the Department for Transport has to fund all the railway-related expenditure and the capital costs, and the Treasury gets the revenue. That needs to change very quickly and I hope my noble friend will say something about that. I doubt that needs legislation but, if it does, it needs to come quickly.
The other interesting and very important issue that we need to discuss is the role of the private sector. I hope it is not dogma that is driving the present Bill —I do not think it is. As the noble Lord, Lord Young, said earlier, the private sector actually sometimes brings good value for money. In yesterday’s Sunday Times, it was interesting to note that, before Covid, the Southeastern franchise got a £231 million subsidy in 2021, up from £132 million while it was still privatised.
You can have different examples everywhere, but I hope that we can look at these things and at the benefit of investment not only in the franchises and open access but in getting some competition. I was in Germany a couple of weeks ago looking at some railway issues, and I observed the German railway company Deutsche Bahn, which is often held up as a role model of a vertically integrated rail body. Maybe the Government here think that we should follow the Germans’ role on this. But according to the press report a couple of days ago, two-thirds of the long-distance trains reached their destination on time, which was a new record low, and the company reported a loss of over €1.2 billion—I do not think that my noble friend will want to have a loss like that—coupled with a debt of €34 billion. What is interesting is that they are mainly the intercity services, whereas many of the local services in Germany are franchised out, some to UK operators. The general feeling is that they get much better services from them than we might expect.
Other issues need to be addressed sometime in the next six months, either before the new Bill or in this Bill. Ticketing is a disaster at the moment. There are various different ways round it that people have suggested, but there is a general feeling that it is too complicated and expensive and that it needs simplification. Maybe my noble friend will be able to tell us how much money will be saved when all the franchise operators become state-owned.
The other thing that the railways have suffered from dramatically in the last few years is strikes. People do not want to mention it, but it is interesting that the state-owned, or state-controlled, passenger franchises were unable—or not allowed, depending on what you think—to negotiate with the trade unions, whereas the open-access operators and the freight operators were able to do so, and I believe that there were no strikes there. Does that mean that the new government-controlled operator will do it better? I do not know, but it needs looking at. As a noble Lord said earlier, we need to, I hope, have some devolution of the passenger operators to give control over things such as remuneration, services and rest-day working, so they can negotiate without it all going back to Whitehall.
The last thing I will cover a little is freight. Other noble Lords have spoken about freight but, as they may know, I used to be chairman of the Rail Freight Group. First, investment is needed to get freight going. If you have Great British Railways deciding which trains go where—and if it is also in charge of capacity, which may be on the cards—where does freight come in? The answer is: it will come bottom of the pile.
Secondly, on some of the connecting lines that freight uses are not used by passenger trains, a very small amount of electrification would enable the freight trains to be electric hauled all the way. Apart from saving on greenhouse gases and everything else, that would make it much more efficient. I hope that the Government will look at that in the next few months and see how it can be done. The one that is spoken about all the time is Felixstowe to Nuneaton, but there are many others. A small amount of electrification is needed, and I hope that it could be done much more cheaply by a Network Rail that is maybe under different management and more efficient—we have heard nothing about Network Rail so far today, but we will see.
Finally, what really made me very happy, when I was in Berlin at that railway conference exhibition, was that there was a new freight locomotive owned and developed by GB Railfreight, one of our rail freight companies. It is a brand-new development, because it is tri-mode—electric, diesel and battery—which is exactly what everybody wants. Along with Beacon Rail, GB Railfreight has invested in this, took it to Berlin and showed it off to the world. That is good, but its needs a bit of support in the home territory, so that it can actually grow its business alongside the passenger trains.
In conclusion, I congratulate my noble friend on her opening remarks. I look forward to what she will say in response to the very many speeches she has heard. I look forward to the next stage of the Bill.
Baroness Jones of Moulsecoomb (GP)
My Lords, it was a real pleasure to hear the maiden speech of the noble Baroness, Lady Pidgeon. We overlapped for eight years on the London Assembly, and I guarantee your Lordships that they have seen the softer side of her today. When I was introduced to the House, they found it difficult to find anyone who knew me, because I was a London representative, but the noble Baroness, Lady Hamwee, spoke up for me. She warned the House that I take no prisoners, and I think that that applies to the noble Baroness, Lady Pidgeon, as well. That is a real asset to our debates here, so I look forward to her next contribution.
I also welcome the noble Lord, Lord Grayling, who is not in his place at the moment. I will have a quiet chat with him about the fact that, if you had fewer tourists, you would need less nature recovery—but that is probably a job for another day.
On this Bill, I support the idea of public ownership. It is excellent that Labour has gone slightly back to its roots, and I think that it is doing the right thing by taking back control as each of the railway contracts comes up for renewal—that is good. The Green Party opposed privatisation in the first place, and we do not have much criticism of the mechanics in this Bill, given that it seems to be heavily based on the rail renationalisation Bill championed by our former Green Party MP Caroline Lucas more than a decade ago. I thank the Government for picking up Green Party policy, albeit 10 years later.
These contracts are expensive, and the train companies are already discredited. When rail was nationalised, we had 15% of trains running late, but at least the fares were rated as among the cheapest in Europe. Since then, the percentage of late trains has doubled, and rail users are paying the highest fares in Europe. Plus, as the noble Lord, Lord Berkeley, pointed out, each franchise does its own thing, with passenger confusion over ticketing, websites and delayed compensation. Before finalising plans, perhaps the Government could think about taking some advice from the people who actually pay their way and buy tickets on a daily basis: for example, The Man in Seat Sixty-One might have some very useful advice on how to make things easier.
Alongside that rise in fares, the taxpayer subsidy has grown from under £2 billion to around £12 billion. Both taxpayers and fare payers are thoroughly fed up with their money going into the pockets of shareholders rather than improving the service they get. Public ownership makes sense, but I do not understand why this impeccable logic applies only to railways; surely the Minister’s comments also apply to all other forms of privatisation of essential services. In the next five years, for example, nearly all the big NHS contracts are up for renewal, so will Ministers apply the same logic to them and save this money by bringing them back in-house? The NHS is paying £2.1 billion per year on PFI schemes. The NHS budget is expanding, and yet we are getting less back because of the growing role of the private sector. I have heard a lot from this Government—and from the previous one—about value for money, but those rules go out the window when we look at PFIs. Taxpayers have spent £80 billion on NHS PFI schemes that only got £13 billion of actual investment; that does not seem like a good deal.
Public ownership of rail is a good thing, but what difference will it make to passengers? I hope it will enable Ministers to directly reduce fares and have a real impact on traffic reduction. In the years between climate change becoming a recognised issue in the early 1980s and the husky-hugging era of Prime Minister Cameron, the cost of motoring fell while rail and bus fares rose rapidly. Season ticket fares are often 80% higher than they were before privatisation, and longer-distance fares can be twice as high as they were. This is not the record of a country serious about climate change, and we have failed to reduce emissions from the transport sector.
This Government, like the last one, tell us that there is no money. However, during my time on the London Assembly, which other Members of your Lordships’ House might remember, we worked with the mayor on promoting the congestion charge and the ultra low emission zone. That generated the extra revenue that helped to keep fares lower and provided some of the money needed to build new Tube and rail lines. Politicians of all parties knew the value of having a public transport system that worked and was fairly cheap to use, but only a few of us were willing to raise that money for investment by saying that the polluter should pay more. In fact, there was a classic comment from the then Mayor of London, Ken Livingstone, who said that the only people supporting his congestion charge were businesses in the City and the Green Party.
Portugal has just introduced a £20 monthly rail pass for all its services. That is the kind of vision we need here in the UK from a publicly owned rail system. It would take ambition and money, but we could make the polluter pay by finally taking the brake off the fuel duty escalator that new Labour introduced.
The Government have taken positive steps to give local authorities the power to regulate buses, so the next logical step is to give the metropolitan mayors a big say in how rail works with bus and tram services, to be the better option in large areas of the country. We need democratic control of the railways, not decisions driven by Whitehall and, even worse, the Treasury.
Privatisation of rail has given us higher fares and generated a fat profit for all the state-owned German and French rail companies, which took advantage of UK taxpayers. I congratulate Labour on bringing this to an end. But why not end the disastrous mistake of water privatisation that will cost £12.5 billion in this Parliament alone, only to pay shareholders and creditors, but which will still result in waterways full of faeces, agricultural run-off, other chemicals, drugs, paint, bleach and plastic? If water companies collapsed, we could buy them for pennies and run them ourselves.
On public ownership of the energy system to deal with the huge jump in household bills, we could end the scandal of record-high standing charges that do nothing to discourage energy use and which hit the poor really hard. Rail companies have made a good profit, but British Gas has made a tenfold profit over the last year, and the likes of BP and Shell have doubled and trebled profits. Public ownership could end those excess profits and bring down prices for consumers.
The public can see these injustices and the way this system of privatisation eats up taxpayer cash and consumer monthly payments. It holds back public investment in our economy and, instead of new hospitals or railway rolling stock, our money buys new private jets for the super-rich. The public want more public ownership, and I hope the Government start listening to voters rather than lobbyists and party donors.
To sum up, my speech is a mix: “Well done, Labour, but why stop there?”
Lord Browne of Ladyton (Lab)
My Lords, it is a pleasure to follow the noble Baroness, Lady Jones of Moulsecoomb. I think that on behalf of my noble friend I can thank her for her explicit support of this piece of legislation, but perhaps she will need to wait for another date for a response to the rest of her speech. It is a pleasure also to welcome my noble friend Lady Blake of Leeds to her place on the Front Bench today and to commend her on an excellent opening speech. I am pleased too to welcome both the noble Lord, Lord Grayling, and the noble Baroness, Lady Pidgeon, to your Lordships’ House. I watched them while they were making their respective maiden speeches; it is perfectly clear to me that they have both secured the ear of the House, and I look forward to their contributions in the future.
It will be no surprise to anybody that I rise in support of the Bill before your Lordships’ House. It is legislation for which the Government have a direct mandate and which commands a great deal of public support. Perhaps most importantly, the Bill is pragmatic, protects the taxpayer from the penalties incurred by ending franchises precipitately, and offers greater flexibility for the deployment of rolling stock.
Perhaps I should start by declaring an interest like my noble friend Lord Liddle. I am a regular passenger on Avanti West Coast, the worst-performing train operator in the UK. I could end my speech with that statement, given the chronic frustrations hazarded by anyone intrepid enough to venture on to one of Avanti’s services. Almost 60% of its trains were late in the second quarter of this year, and cancellations ran at double the national average. I mention this not merely to describe my own experience of travelling on our rail network—I am sure that many other noble Lords have worse stories to tell than I have—but to emphasise the asymmetry of performance between the different franchisees.
Conversely, there are franchises that have performed rather well. As we were reminded by the noble Baroness, Lady Scott of Needham Market, Greater Anglia, for instance, has some of the highest punctuality rates in the industry, has invested £1.4 billion in rolling stock and, since Covid, has consistently generated a financial return to the Treasury. West Midlands Trains has invested £1 billion in its fleet, with half its current trains replaced with new vehicles built in the UK.
With this asymmetry of performance in mind, can my noble friend the Minister say whether the Government plan to take a purely chronological approach to renationalising, ending different franchises in order as their contracts expire, or does she envisage a more targeted approach where the performance of different franchises is taken into account? It would be somewhat quixotic to start this process by bringing Greater Anglia into public ownership as soon as its contract expires, which is imminent, while Avanti continues for years to run a grossly underperforming service. Surely we should take performance into account and ensure that those passengers suffering from the least effective service see changes first. From the fact that the Government, through the terms of the Bill, have given themselves discretion to focus on the worst-performing routes and operators first, I infer that such a course of action is at the very least under active consideration.
In addition to that question, I draw the attention of my noble friend the Minister to the briefing we all received from Transport UK in advance of today’s debate. That briefing contains specific questions and supporting amendments for debate in Committee and the later stages of the Bill’s progress. In particular, I would be grateful to know, first, what she envisages by way of reporting obligations to Parliament in respect of the future performance of publicly owned train operating companies, and, secondly, whether the Office of Rail and Road will be required to assess the ability of a publicly owned company to operate a franchise effectively in advance of contracts being awarded. If so, will the details of such assessments be made available to Parliament for effective scrutiny?
We have heard and will hear “privatisation” and “nationalisation” invoked today but, as it stands, passengers have the worst of both worlds. We have a system run by private companies for profit which, at the same time, rely on implicit and explicit public subsidies, some of which end as dividends for the franchise holders, nobody else gaining. We are all aware that the former British Rail enjoyed a somewhat ambivalent reputation. But in 1989 British Rail was recorded as being 40% more efficient than eight comparable European railway systems; rolling stock was an average of two years younger in 1996 than it was in 2013; and British Rail’s punctuality rating, at 90% PPM in 1995, has only once been exceeded in a calendar year since privatisation—and that was in 1996.
The shadow Secretary of State suggested during Second Reading in the other place that this legislation is ideologically motivated. Leaving aside the dissonance of such an accusation issuing from a party which has been setting ever more rigorous tests of ideological purity of itself since Brexit, I believe that the motivation behind this Bill is far simpler—it is that the railway system across Britain does not work. Our railways are a cautionary tale for the rest of Europe. Despite EU directive 91/440 promoting rail privatisation, as we have heard from other speakers, European nations have looked at our system and decided to stick with a state-run operation.
Depending on your means of comparison, we have either the highest rail prices in Europe or prices that are among the highest. We have a fragmented ticketing and timetabling system that works in the interests of franchise holders rather than passengers. Subsidies run at twice pre-pandemic levels, while tickets have risen by around 25% in real terms since the privatisation experiment began. The legacy of privatisation on our railways is more government subsidy; more expensive tickets; endemic industrial dissatisfaction; and HS2, that artery of levelling up, repeatedly promised before being questioned and then cancelled.
There are some, thankfully not apparent in our debate today, who suggest that privatisation has worked and that we must merely persist with this experiment in the face of observable evidence. I will remind them of the words of John Maynard Keynes who, when tasked with an apparent inconsistency, responded:
“When my information changes, I alter my conclusions”.
This Bill is before your Lordships’ House today precisely because the public have all the information they need; they are dissatisfied with the cost and unreliable standards of service on our railways and know that we need fundamental change. Two-thirds of the public support renationalisation, and that figure rises to 73% among those who regularly use the railway network. It is no coincidence that those most frequently exposed to the reality of our railways are precisely those who support them coming back into public ownership.
At this juncture, I would like to remind your Lordships’ House of an historical advocate for state control of the railways. Given the shadow Transport Secretary’s apparent belief that this is a nakedly ideological measure, I am somewhat surprised to be claiming Winston Churchill as a socialist ideologue; he may have been at one time in his life. In 1919, he gave a speech in Dundee in which he explained that:
“So long as the railways are in private hands they may be used for immediate profit. In the hands of the State, however, it may be wise or expedient to run them … develop industry, place the trader in close contact with his market, and stimulate development”.
Compare that with the notes to the King’s Speech, in which the Government described the changes that this Bill would make. They described a system in which the railways would
“serve the interests of all users and the taxpayer, rather than focusing on maximising financial returns to private-sector operators”.
The aesthetic difference between these two passages may be pronounced, but the sentiment is absolutely identical.
Critics have suggested that nationalisation is somehow an easy option. On the contrary, as my noble friend has been reminded today, the Government will take on enormous responsibilities. As more franchises come back into public ownership, the Government will be held directly responsible for people’s journeys; shortcomings in respect of service and punctuality, fare costs and overcrowding will be laid at their door. If that is an easy option, I would be intrigued to hear such critics define a grave political risk. The fact that this Administration are prepared to countenance such political risks is surely testimony to their disinterestedness and their freedom from selfish motives, which therefore allows freedom to act fairly in seeking to improve our rail network. I shall support this Bill as it journeys through your Lordships’ House and gives effect to the mandate the Government were given at the general election.
Lord Balfe (Con)
My Lords, I also congratulate the noble Lord, Lord Grayling, who is not here, the noble Baroness, Lady Pidgeon, who is, and the noble Lord, Lord Cryer, who still has to speak to us—I am sure I can congratulate him on his speech, although I have not heard it. The noble Baroness, Lady Jones, said that the noble Baroness, Lady Pidgeon, did not take any—oh, whatever it is.
Lord Balfe (Con)
Maybe the noble Baroness, Lady Jones, does not take prisoners either, but she always does it with a great degree of humour, and we are pleased to hear her speak. I remind Members of my presidency of BALPA, the pilots’ union, which is not exactly a rail union but is in the transport sector.
I will carry on from where the noble Lord, Lord Browne, finished, because Winston Churchill not only supported nationalisation in 1919 but, when he came back into office in 1950, did nothing to undo the actions of the Attlee Government. In fact, he specifically said to Walter Monckton, who was his Minister of Labour, that he must not upset the rail unions; so, Churchill, to an extent, was fairly consistent.
The noble Baroness, Lady Blake, said that we had had three decades of failure; I point out that half of them were under the Labour Government, but we will pass over that and look forward. I do not agree that it has all been failure. I fully support the manifesto commitment, and I am not going to vote against it or anything. However, I have lived those last three decades in the city of Cambridge, and I have observed that we have a new railway station, with another one half built. We have three separate train lines, one running to King’s Cross, one running to St Pancras and one to Liverpool Street, and thanks to the way the franchises have been distributed we have never been without trains, because if one goes on strike the other goes to work. Also, of course, the number of passengers has gone up tremendously. I admit there are downsides to all this but let us not think that it is been a complete mistake, because it has not.
I would like to ask about, and draw a line under, the future of investment in rail when we move forward from where we are, because the history of rail and road investment has, as the noble Lord, Lord Young, said, been one of constant Treasury interference and investment decisions being based not on what is needed for the service but on how you split up a pie between defence, health, education, infrastructure, transport, et cetera. That is not a way, as they say, to run a railway. I hope that we can get round to some better system of allocating capital expenditure. I know this because in my part of the world we had years of campaigning by Members of Parliament from different parties for the widening of the A14 road. It did not come up against any transport needs; it kept on coming up against the Government’s capital allocations. When we look at the transport and railway needs going forward, we need to look carefully at this.
The final set of points I want to make are about this legislation. It was very clearly in the manifesto. I say to people on my own side: do not keep bringing the unions into it. The fact that there were long-standing disputes, particularly with ASLEF, was a sign that Conservative Ministers did not manage to solve them, as much as anything else. Just as a hobby, because I am a rather sad person, I printed out all the donations that were received by the various parties. Apart from the fact that the Conservative Party had £44 million, against the Labour Party getting only £34 million, with the Liberals getting just under £10 million, individuals contributed £20 million to the Labour Party’s donations; trade unions contributed £7.3 million. Of the individuals, one lady, Mrs Anna Lisbet Rausing, gave the Labour Party around £1 million.
I do not deny her that pleasure, but the railway unions gave the Labour Party £143,000. That is the clothing allowance of the Cabinet. Let us be realistic about this. The unions certainly have influence in the Labour Party—partly because our party does not treat them very well—but they certainly do not buy the party. I can speak from having been in the Labour Party as well as the Conservative Party. On this, I say, “Do come off it”. The fact of the matter is that there has been tremendous demand for change in how the railways are run; that has been present for probably the last 10 years.
What we have here is the beginning of a new era. Not everything is right; I certainly want to see some serious consideration given to the way in which capital investment will be put out. I would also like to know how the Minister and the unions will relate to each other. If there is not going to be a pay body, how will they go forward? The Minister is not going to sit in the office and say, “What shall we do today? Let’s listen to the unions’ pay demand”. There must be some sort of structure and body to look at how the pay awards are given, as there has been up to now. I would like to know how we are proposing to go ahead in the future with that very difficult area.
Finally, if a train driver earns £60,000 or £70,000 a year, they are doing a highly skilled job that requires training. They are driving a train that costs millions and which is full of lives that could be lost if they make a mistake. They are well worth the money. I have always resented the fact that there is a certain middle-class thing where, if you do not have a pen and a piece of paper and sit at a desk, you somehow are not worth a decent salary. That is rubbish. Most of the railwaymen I know work hard for the money they get and deserve every penny of it. We should remember that. I am not saying that we over-reward them, but we should not get jealous and tied up because we give hard-working people decent salaries.
Lord Cryer (Lab) (Maiden Speech)
Thank you—my Lords, I nearly said, “Thank you, Mr Speaker”. That is what comes of spending 20-odd years at the other end of the Corridor: you develop certain conditioned reflexes, as many of us know.
I start by offering my thanks to Black Rod, her staff, the clerks, the doorkeepers, the security services, the police, many members of staff and Peers for the help, support and warmth that they have given me since I came to this place on 9 September. I also thank my two supporters, my noble friends Lord Kennedy of Southwark and Lady Smith of Basildon. My noble friend Lord Kennedy and I have known each other since roughly 1986; the exact date is lost in the mists of time, it is that long ago. My noble friend Lady Smith and I were elected in the Blair landslide of 1997. She was the MP for Basildon. I was the MP for Hornchurch for eight years before I lost Hornchurch to James Brokenshire, whom many of you will remember. James and I became friends—at least, I like to think that we were. Sadly, James died very young at the age of only 53. I was then the MP for Leyton and Wanstead for 14 years. Leyton and Wanstead is probably one of the most mixed constituencies not just in Britain but on the face of the planet; if you pick a particular community, it probably has representatives in Leyton and Wanstead.
During nine of those years, I chaired the Parliamentary Labour Party. It is good to see my opposite number, the noble Lord, Lord Brady, in his place. He chaired the 1922 Committee for 14 years, I think. It is fair to say that, during the first half of my tenure as chair of the PLP—during the previous leadership of the Labour Party—chairing the PLP had its interesting points on Monday evenings at 6 pm in Committee Room 14. During the second half, in the run-up to 2024, life got a bit quieter and more boring for me—but maybe a bit livelier for the noble Lord, Lord Brady.
I cannot speak today without mentioning the anniversary of 7 October. A year ago, there was the deadliest attack on the Jewish community that the world has seen since 1945. It was right up there with the activities of the Nazis and the pogroms perpetrated on Jews across the globe and down the centuries for all that time. However, before I finally get on to the Bill, which I will do, we must remember that anti-Semitism has been on the rise in this country for some time. It is getting broader and deeper. If you do not believe me, just look at the figures produced by the Community Security Trust. It is there for all to see.
I do not enjoy saying this but I point out that anti-Semitism seeped into the pores of the Labour Party—my Labour Party—for a number of years under the previous leader. Nor do I enjoy saying that, as chair of the PLP, I found not just an unwillingness to tackle racism among the then leadership of the party but an obstruction to those of us who wanted to tackle the anti-Semites and kick them out of the Labour Party. I remember once being shouted down at a party meeting because I suggested that, on balance, it maybe was not a bad idea to kick racists out of the Labour Party. Regardless of what happens in the next few years, Keir Starmer deserves every credit—and always will—for tearing anti-Semitism out of the Labour Party by its roots, to use his phrase. He will always have my support and my loyalty for doing that alone, regardless of the other things he has done to great success. Even so, it remains a source of anger and resentment that we had—I emphasise “had”—members of the Labour Party who supported Hamas, Hezbollah and the clerical fascists who run the regime in Tehran. I will return to anti-Semitism and racism generally another day but, for now, I turn briefly to the Bill.
The railways have had a central part in my life since I was born, really. My dad was a founder of the Keighley & Worth Valley Railway in the 1960s; it was one of those railway lines that was closed under Beeching, which I view as a disastrous period in British transport policy. He set up the Keighley & Worth Valley light railway. He then—I do not know how—persuaded EMI to film “The Railway Children” on that railway. He then got himself a job as the technical director on the film, then got the entire family jobs as extras on the film. My sister and I never saw the money but that is another story. It was an absolutely extraordinary experience. It was pointed out to me a while ago, in the run-up to the previous general election, that that general election was the first in Britain since 1970 in which a cast member of “The Railway Children” was not standing as a parliamentary candidate in the election campaign—so that is something to conjure with.
I support this Bill and have always supported the public ownership of rail. However, worse than the privatisation of the railways was the fragmentation of the railways. There are two quick historic examples that I can pray in aid. The Governments of the 1920s generally tended to subscribe to free market economics and, to some extent, politics. Yet, in 1921, the then Government passed the grouping Act, which brought more than 100 railway companies together into the big four railway companies, because it was seen that fragmentation was not working. The railways were literally grinding to a halt in many cases.
I will finish with this example. Arguably the biggest fan of the free market to occupy 10 Downing Street was William Ewart Gladstone, yet even Gladstone thought that the fragmentation of the railways in the 19th century was a mistake. Perhaps it was not a mistake originally, but in 1844, before he was Prime Minister, when he was a Secretary of State in the Peel Government—some of your Lordships will know this —he presented the Railways Bill to Parliament. What noble Lords may not know is that that Bill originally provided for the public ownership of the entire rail network.
The Bill was important, because it ended up being the first Bill to be introduced that represented government intervention in rail transport. It provided the parliamentary train which meant that working-class people across Britain could afford to take at least one rail journey a day. That was its intervention, but it originally had provisions for public ownership. Gladstone abandoned that as Secretary of State, because in those days the whipping system in the House of Commons was not as firm as it is now. There were semi-independent MPs, and he decided that he could not get it through the House of Commons, so he watered it down and moved on to introducing purely the parliamentary train. Nevertheless, if public ownership and a more homogenous network were good enough for WE Gladstone in 1844, they are certainly good enough for us in the 21st century.
It is a huge honour and a privilege to deliver my maiden speech today in front of my friends, many of whom I have known for many years in the other place and, to some extent, in this place. I look forward to future debates.
Lord Snape (Lab)
My Lords, it is a great pleasure to follow my noble friend Lord Cryer and to congratulate him on a superb maiden speech, which informed and entertained both sides of this Chamber. I am delighted to say, and I am sure I speak on behalf of colleagues from both sides of the Chamber on this, that despite his early fame in the film world, the attractions of Hollywood did not drag him away from a political career and he stuck to his parents’ views and principles. I will come back to Bob and Ann in a moment, but my noble friend’s career, as a Member both of the other House and of this House in the years to come, shows equal talent to that of his mother and father.
My noble friend was elected in 1997 in that Labour landslide—unusually, with his mother. That was a fairly unusual combination: fathers and sons occasionally get elected, but mothers and sons rarely do. I take this opportunity to pay tribute to Ann, his mother, who fought a long, and for her sometimes unpleasant, battle on behalf of women who were being exploited in various parts of the country. The championship that Ann showed will be and is being followed by her son, and I know that she is enormously proud of his elevation to this House.
Going back to my noble friend’s experience in the other place, he became the longest-serving chairman of the Parliamentary Labour Party, which is enormously to his credit. Those on this side of the House, particularly those who have spent some time down the Corridor, know just how fractious meetings of the Parliamentary Labour Party sometimes are. It shows the strength and character of my noble friend that he was not just elected but re-elected chair. There were instances of—I should not say it—skulduggery when we elected the chair of the PLP, but my noble friend was respected enough to hold off against any plots against him and to be re-elected. He quite rightly reminded us of the difficulties that our party suffered under its previous leadership, and the fact that he played such a prominent and courageous role in opposing anti-Semitism in the higher ranks of our party is, again, greatly to his credit. I know I speak for both sides of the House when I say that we look forward to hearing him again in the future.
I also congratulate the two other maiden speakers. I know the noble Lord, Lord Grayling, because I have taken an interest in transport for many years. I cannot say that I have entirely agreed with him over the years, but I thought that his contribution today was excellent. I particularly congratulate the noble Baroness, Lady Pidgeon, who also made a superb maiden speech. She greatly enhanced her reputation right from the start by her knowledge of the subject that we are discussing today—transport.
I also congratulate my noble friend the Minister on her appearance during this debate. I hope I do not cause her too much embarrassment when I say that I do not share some of the good feeling of many of my colleagues about the Bill. I do not think it tells us very much. It was 2021 when the Great British Railways project was brought before us following the publication of the Williams-Shapps report. Here we are, three years later, and all we have to show for it is the total bill for GBR so far, which I understand is about £61 million. I have no idea what that money is being spent on and what will happen in the future, because this is very much a skeleton Bill.
I spent my working life in the railway industry, as my father did. I have bored noble Lords from both sides with some of the stories from my past. I started on the railways in a signal box, as a teenager in the late 1950s. I qualified as a signalman at 18. I have to say —my late father would agree with me on this—that working for a nationalised railway in those days was not all it was cracked up to be. In those days, the railway industry was dependent on Treasury largesse, but many of us spent our time, as I did, in signal boxes built by the Victorians, some of which are still working and are perfectly safe. They were built to last, unlike some of the modern equipment on the railway system.
However, the fact that we in the railway industry never had the opportunity or the finance to modernise until recently made me feel that perhaps an injection of money from elsewhere—from the private sector, if you like—might benefit it. I listened with interest to the contribution of a former Secretary of State in the noble Lord, Lord Young of Cookham. He outlined graphically and aptly the difficulties in trying to persuade the Treasury, against all other financial pressures, to put money into the railway industry. However, we managed it on two occasions over the years, following the 1955 modernisation plan and with some of the modern equipment that has been installed since.
The fact is that we competed for scarce resources against hospitals and schools, and against one’s colleagues. I chaired the Channel Tunnel Back-Bench committee in the other place, when many of my colleagues from the parliamentary party said, “What do you want to waste money on that for? I need a hospital in my constituency”, “I need to repair schools in my constituency”, or, “There is a finite amount of money available and I want some of it for my constituents”. That is a perfectly legitimate stance to take, but it indicates the difficulties of depending entirely on His Majesty’s Treasury for finance.
Look at what happened immediately after the 1994 Act. The concept of privatisation and the way it was implemented was crazy, and I said so at the time. I understand that John Major, then Prime Minister, wanted to privatise the railway based on old-fashioned regionally based companies. He was a bit sentimental in that way. What was his comment about old maids cycling to church on a Sunday morning? Some of the old maids in the Cabinet at that time were not prepared to allow him to privatise on that basis, so we got the rather nonsensical and fragmented system that we have at present.
However, at least initially, a lot of money came into the railway industry that would never have come had matters been left to the Treasury. There were lots of new trains. The crazy system was such that millions of pounds were made and taken out of the industry by those running the companies that provided the trains, but many of those trains did end up on our railway system.
I was speaking recently to a gentleman known to many noble Lords on both sides of the House, Christopher Austin, the former British Rail parliamentary affairs officer who retired upon privatisation in 1994. I asked him whether in 1994 we would have got the Treasury to agree to the amount of investment into the new trains that took place, and he said, “No, we wouldn’t have done: we would have been scratching around”.
I congratulate my noble friend Lord Liddle on his contribution earlier. I went to see his boss in the late-1970s about the renewal of the classic diesel multiple units that were introduced in the 1950s. He said, “I’d love to be able to say that we can find the money to renew them, but we can’t at the present time”. Because of that, those classic diesel multiple units from the 1950s were eventually renewed in the 1980s on the basis of Treasury parsimony, if you like—the Treasury certainly had a big input—which said that, for every three-car classic diesel multiple units that you have inherited and are now past their sell-by date, you have to replace them with two-car diesel multiple units, and so we got the sprinters and pacers. We have only just got rid of the pacers. Anybody who has travelled on them will know full well that they were known by drivers as “threepenny bit wheels”—noble Lords will remember the old-fashioned threepenny bits. Travelling on them, hearing them screeching around curves, was more third-world than modern-day history. That was a result of the parsimony. It was asked at the time by BR management whether a similar number of seats should be provided as the trains being abolished. They were told, “Just put the seats closer together”, and the result was the discomfort of those cut-price trains, some of which we still have at the present time.
My noble friend understandably had some harsh words to say about franchising. But what will happen in this city, for example, where TfL franchised its railway system, and with Chiltern Railways—in my view the one success of the whole privatisation process, where a line that was being run down by British Rail now provides two trains a day to Birmingham and an extensive commuter system? Again, BR management did not want to close these down, reduce the services and stop early-morning and late-night trains, but it was given a block amount of money every September and told “Run the railway with that money and don’t come back for any more”. My noble friend the Minister when she comes to wind up will say that this will not happen in future as far as the Treasury is concerned, and I will believe her. Well, I will try to believe her—let us put it that way—because it has never been noticeably generous, and I will need some evidence that it will be so in future.
I say again: look at the big cities. How will we provide train services in and around those big cities with one national rail system making decisions here in London? Many of our metropolitan mayors want the right to implement their own train services in their way, and that is a model that does not fit too well with nationalisation as a whole. So, although I wish the Bill well, we will certainly return to these issues in much more detail when we see exactly what plans His Majesty’s Government have for the railway industry.
Lord Inglewood (Non-Afl)
My Lords, I have much enjoyed listening to this afternoon’s debate, partly because of the excellent maiden speeches we have heard, and to have been present when the noble Baroness the Minister has been having her first big step-out on to the stage. Unlike almost all the other speakers, I do not consider myself an expert on the railways. I rise as somebody who has spent a great deal of time travelling on the railways, and that is the basis of my comments.
It is true, and I declare it, that I am president of the South Tynedale Railway, which runs for approximately 8 kilometres north from Alston towards Haltwhistle, which is about five or six miles beyond where we currently end—once we get to Haltwhistle, we are on to the British national network and the world is our oyster. Also, although I cannot in anyway emulate the vivid reminiscences of the noble Lord, Lord Snape, as a very small boy I changed the signals in the signal box at Bassenthwaite Lake.
As I got on the train this morning in Penrith, near where I live—it arrived two minutes late and arrived in London two minutes early—I realised, and I am not alone here by any means, that for the first few years I travelled on the railway the trains were pulled by steam engines. Just as the source of power has changed, so has the ownership of the railway system and the trains running on it. Over that period, the service has been variable. Under British Rail, I had good experiences and ghastly experiences. Under the privatised rail system, I have had ghastly experiences and good experiences. We want to be even-handed in our criticism of what might have taken place in the past. People might think it eccentric, but I am just going to put in a word on behalf of Avanti. It has had terrible press and a lot of justified criticism, but it is trying to get better and is improving the service, and that should be recognised, because if a rail service becomes a completely demoralised army it will end up delivering worse for the public.
The real problem with the politics of the railways—I use that phrase in a general, non-specialist sense—is that it is rather like the English football team: the less you know, the more emphatic are your views about what needs to be done. What we are talking about here is the implementation of a manifesto commitment of the new Government. Of course there is a commitment, but there is also an awful lot of detail that needs to be filled in before things actually happen. The reality of railways is that it is all very complicated. At the point of delivery it has to be delivered by experts, regardless of who owns the system, just as the National Health Service has to be delivered by trained, qualified doctors and medical staff, supported by specialist private sector businesses, science and technology. In addition to that, our rail services have to be delivered in the national, not a partisan or party-political, interest, regardless of ownership and regulative frameworks.
We all know that there are a whole series of criticisms, deficiencies and problems that relate to the railways system in this country today. Much of this results, either directly or indirectly, from our current wider national malaise of concentrating too much on consumption and not carrying out sufficient investment. That is something that we need to address nationally.
As a number of speakers have said, the Bill does not have all that many words in it compared with other Bills we consider in this House. We are assured that it presages real change that will bring improvement. What we cannot let it become is a kind of blank cheque to give the Government completely free range. What I think the public and Parliament want and need is a convincing explanation of how it will all happen and evolve. Soundbites are no good. For example, where I come from in Cumbria, where I have been chairing the local enterprise partnership, the railway system is a very important part of the infrastructure of that county and the businesses in it. The future prosperity of Cumbria materially depends on rail connection.
An important point made by the noble Lord, Lord Berkeley, is that if we do not get it right it will waste, and therefore cost, a great deal of money. That is something we must make sure we avoid if we possibly can.
As I have said, I do not know the answer to many of the problems facing our rail system, but we all need to know the kind of ways forward to deal with them that are being proposed by the Government.
In the debate on the King’s Speech, I said I was agnostic, as I am, about the forms of ownership of and control over our railway system. What I want is simple: I just want it to work properly. This approach was more vividly described some years ago, in a different context, by Chairman Deng, who said, “I don’t care whether the cat is black or white as long as it catches mice”. What I would like to hear from the Minister is not that she can give us an assurance that the new cat is a good mouser but rather how it will catch the mice, how much it will cost and how many it will manage to get.
Lord Sikka (Lab)
My Lords, it is my great pleasure to welcome the noble Lord, Lord Grayling, the noble Baroness, Lady Pidgeon and my noble friend Lord Cryer to this House. I thank them for their excellent maiden speeches, which have given us plenty to ponder and think about. I look forward to their future contributions and to joining them for a cup of tea or coffee as well.
The privatisation of the railways has been a failure, although it has managed to secure an entry for Prime Minister John Major in the annals of privatisation. It was a service which Margaret Thatcher was not willing to privatise because of the huge problems, but John Major was desperate to get an entry in the annals of privatisation, so here we are. In 1994, when the old British Rail was broken up into more than 100 companies, it was one of the most efficient in Europe. It had one of the cheapest fares per mile in Europe and a punctuality rate of 86.4%; it was receiving, at that time, an annual subsidy of £1.7 billion. The ideological break-up of British Rail resulted in the fragmentation of the system, the neglect of the long-term and the multiplication of administrative structures. Suddenly you needed 100 boards of directors, 100 accounting systems, 100 HR systems, 100 sets of auditors and 100 sets of accountants, and all that inevitably pushed up the costs of the privatised system.
Even worse, there was no real competition. I use the c2c line when I come to the House. There is no competition: I have absolutely no choice and I have to pay whatever it demands. Today, I had to stand all the way from my home in Essex to London because there are simply no seats, and the wifi was non-existent. There is nothing I can do about it; I am just a captive customer.
Thirty years after John Major’s excursion into privatisation, train companies have a punctuality rate of 70.1%, the UK has one of the most expensive train fares in Europe, and last year the subsidy was £11.9 billion. I will not say anything about catering and the awful sandwiches on long-distance routes at the moment, as many noble Lords have possibly experienced.
Any move to curtail privatisation is most welcome, and I support the Bill. That said, I have a number of questions that I hope the Minister will be able to clarify. Clause 1 states that passenger services will in future be provided by a public sector company. How are these public sector companies to be made accountable to the people? I recommend that at least 50% of the board of directors of this public sector company, which could well be a number of companies akin to the railway boards that we used to have, should be directly elected by customers. Customers should also vote on executive pay, not only of those companies but of the regulatory boards. That way, people can exercise some influence. They cannot be taken for an easy ride and cannot be ripped off on a regular basis by suboptimal services. I hope the Minister will be able to give some commitment to that form of democratisation.
I also have a question about how the new public sector company is going to acquire the necessary rolling stock. Let us look at the current situation. Rolling stock is not owned by train-operating companies; they lease it from rolling stock companies and pay an exorbitant amount of rent. Last year, some £3.1 billion was paid in leasing payments by train operating companies to roscos, or rolling stock companies. Just three rolling stock companies—Angel Trains, Eversholt and Porterbrook—control about 87% of the market, and they have a profit margin of 41.6%. That is exorbitant. There is absolutely no justification for that kind of profit margin because the payments are absolutely certain—they are paid either by customers or taxpayers. I hope that the Government are getting ready to investigate profiteering by these rolling stock companies and put an end to the gravy train that has been operated.
These three rolling stock companies are foreign owned and registered in Luxembourg, which means they are obviously not paying taxes there. There are only two reasons for companies to go to places such as Luxembourg: one is secrecy and the second is tax avoidance. There is no other reason whatever for going to such places. Last year, these roscos paid a dividend of £409.7 million, and in the past decade they have paid more than £2 billion in dividends. This dividend is typically 100% of their pre-tax profits, and no tax is paid on those dividends either because the recipients are outside the UK. I hope that the Government will not continue with these roscos, and perhaps the Minister can confirm that. The Government have choices: they can purchase rolling stock directly from the current manufacturers and eliminate all intermediaries, such as the current roscos; they can create their own leasing company and eliminate these roscos; or they can bring the manufacturing of trains and rolling stock under one roof to consolidate them. It would be helpful if the Minister could explain which route the Government are planning to take.
Judging by the statement made by the Transport Secretary in the other place on 29 July, perhaps the Government have something else in mind. She said that the rationale for the current Bill is,
“the failure of privatisation to deliver reliable and affordable services for passengers”.
She added:
“It also makes financial sense, saving tens of millions of pounds each year in private sector fees. That money can now be reinvested in the railways. Running the railways in the interest of passengers and taxpayers, not to the benefit of shareholders, also makes operational sense”.—[Official Report, Commons, 29/7/24; col. 1074.]
That statement was echoed by the Minister earlier, so I assume that it is reasonable to expect that the current roscos will not remain in control or operation and that the Government will not be leasing any trains from those companies. I hope the Minister can confirm that. If my interpretation of that statement is erroneous, I would like to hear that as well.
In addition, can the Minister say what will happen to freight services? Why are they not being brought into public ownership? They are highly lucrative as well.
Finally, I ask the Minister to end what train companies call dynamic pricing. Actually, there is nothing dynamic about it; it is simply a way of fleecing customers. Two of my friends from Australia visited London and, on the spur of the moment, decided that they would like to visit Exeter. A quick search online for an economy class return the next day quoted them £700 each—that is more than a flight to China. Needless to say, they did not travel by train. I wonder how many other tourists have refrained from visiting wonderful parts of this country as a result of this kind of fleecing and how many business trips have been put off. There is absolutely no excuse for this. Can the Minister assure the House that public ownership of passenger services will end this abusive practice? We need a fixed price, regardless of the time at which anybody travels, not £700 returns to Exeter. That is just criminal, and I hope somebody gets prosecuted for it.
Baroness Brinton (LD)
My Lords, it is a pleasure to speak after the noble Lord, Lord Sikka, who, as usual, brings his accounting experience to make us think about things in a slightly different way. It has also been really good to hear three maiden speeches. The noble Lords, Lord Grayling and Lord Cryer, spoke from very different perspectives but their experience and knowledge shone through and we look forward to hearing more from them in the House.
It was a real pleasure to hear the maiden speech of my noble friend Lady Pidgeon. I have known her for some years too, and her expertise on transport in the Greater London Assembly was second to none. She is a tireless campaigner on improving transport for people, making it more reliable and more accessible. That is how we got to know each other. I believe that she will make as strong a mark in your Lordships’ House as she did in the GLA.
Other noble Lords have already demonstrated their knowledge of the structure of the current railway system and expressed their views on this first step of ensuring that public sector operators can be awarded contracts without us having to go to private ones. I want to focus on a key element of Labour’s paper Get Britain Moving, which is not particularly evident in this Bill but which I think is vital. It will not surprise noble Lords to hear that this element is accessibility and assistance services.
Get Britain Moving has a key thread of accessibility and ensuring that assistance is available to all passengers who need it. Indeed, accessibility is in three of the five missions in the paper: “Get Britain building again”, “Get the NHS back on its feet” and “Break down barriers to opportunity”. The contrast with the Bill that we are talking about today, its Explanatory Memorandum and the final-stage impact assessment could not be more stark. Accessibility and assistance are virtually invisible.
The Minister may say that they will come later, but the problem is that, in Clause 2(2)(b) of the Bill, the provision of services means that there will be no improvement in accessibility unless there is a specified change, because it talks about transferring existing arrangements over. If access arrangements at the moment are unsatisfactory and not meeting the law under the Equality Act 2010 provisions for disabled people, will the Government ensure that any new provision of services does meet these legal access requirements?
Why does it matter? The last Government and the present Government have kept talking about Great British Rail services, but the reality is that every part of the rail service structure that disabled passengers need to use is struggling. Transport for All and Disability Rights UK campaign constantly on this. Some of this is the responsibility of the train operating companies and some the responsibility of Network Rail.
I am so glad that the noble Baroness, Lady Grey-Thompson, is in her place. Most noble Lords will have heard that, a few weeks ago, she was left on a train at King’s Cross late at night. No one came to assist her. She had to get out of her chair, crawl from the floor of the train on to the platform, lift her chair down on to the platform and then get back into it. As she says, despite everyone being horrified—I agree with her on that—this happens every day to disabled people. For those like me with electric chairs, pulling chairs off the train is not an answer. When it has happened to me, twice, at King’s Cross late at night, I have had to work out who to ring. I cannot ring the police as it is not urgent. I cannot ring 111; no one will answer until next week. I cannot ring the station because nobody answers the phone. What do you do at midnight? The noble Baroness, Lady Grey-Thompson, came to my rescue on one of those occasions. She tweeted the chief executive of LNER and he managed to find someone to come and find me. She is a star.
But it is not just about understaffed assistance services. It is also the infrastructure at stations, including lifts and the lack of level boarding. The Campaign for Level Boarding rightly points out that the new Thanet Parkway, opened a year ago this July, still does not have level boarding and does not have full-time staff at the station. The purchase of different types and styles of trains means that every station has to use multiple ramps and some train operating companies no longer have staff other than the driver on trains to help you get off when there are no staff at the station. Disabled passengers were promised TUAG—turn up and go—years ago. The cuts and poor infrastructure mean that we have a much worse service. These days, even if we have booked in advance, we are often told when we turn up at a station, “We will absolutely do our best to get you on your planned train but we are very short-staffed; it may not be possible”. This is madness.
Ten days ago, I had to travel from Watford Junction to York for a regular meeting. I always allow more time between Euston and King’s Cross in case of delays. When I arrived at Watford Junction there was a fatality on the line, no trains were going anywhere and the staff, despite dealing with the emergency, managing a distressing situation, found me to tell me to go to St Albans on the Thameslink line instead. They undertook to let King’s Cross know that I would miss my train to York and asked staff at King’s Cross to help me get on another train. It was difficult, because they are often fully booked.
When I got to St Albans, it transpired the lift from the entrance to help get me to the middle platform was out of order. So, to get to it, I had to go to back up to the main road, over the railway ridge and down the other side. I could not cross over where everyone else did because there was no dropped curve. So I had to go down to the traffic lights, cross the road and go back up to the other entrance to St Albans station, through the ticket barrier, all the way down the platform to the far end to the lift.
The staff said the next train was in seven minutes and asked if I could make it. The answer was that I could not. So, while I was chatting to staff waiting for the next train to St Pancras, they informed me that the lift at St Pancras was not working, either. I had to go on to Farringdon. When I got to Farringdon, I got out and asked the lovely assistance person, “So I go up and come down the other side?” He said, “No, you can’t do that because there is only one lift at St Pancras. It is the same one that’s out of order. You have to go out of the station, find the Underground and find the assistance staff, who will take you down to the Circle Line and you get off at King’s Cross”.
By this stage, my blood pressure was going through the roof. I certainly missed the train that was planned for York, but the one wonderful thing that happened when I got to King’s Cross was that not only Euston but Watford had rung King’s Cross and they had checked to find me a space on every possible train in that gap. So I did not make the beginning of the meeting, but I got there for the end. All the staff at every stage were wonderful: encouraging, supportive and as helpful as they could be.
This is not unusual. My story is exactly the same as that of the noble Baroness, Lady Grey-Thompson. We know that this happens to people every day. The lift at St Pancras has been out for weeks. This is affecting thousands of disabled people wanting to get to work. The new Government rightly say that they want to see more disabled people getting into work. We cannot get to work. This is vital.
The New Civil Engineer newsletter on 2 September noted that the noble Lord, Lord Hendy, who cannot be in his place and who was then chair of Network Rail, had said that Access for All was underperforming, with underspending on accessible capital works including £65 million of funding between 2019 and 2024 for accessible capital equipment at stations, including lifts.
In February, the German travel booking company Omio found that the UK ranked among the least accessible railway nations and reported
“alarming inadequacies for individuals with disability in national rail transport”
in the UK. Part of the problem is that Network Rail operates regionally and, with the TOCs having their own standards and their own systems, there is no consistency in provision.
By the way, the long-awaited Access for All portfolio sponsorship office has been delayed again. We are all still waiting for the DfT-commissioned AtkinsRéalis accessibility audit of all the over 2,500 stations, which was one of the recommendations in the Williams-Shapps plan for rail in 2021. So can the Minister outline how the Government will assure us that, as a matter of urgency, their priorities so ably discussed in Getting Britain Moving are put into action for this Bill before any franchise transfer happens? Because, until then, disabled people will not be able to rely on our rail system.
Viscount Hanworth (Lab)
My Lords, I have been pre-empted in much of what I wished to say by my colleague, the speaker before last—but that pleases me.
The period following the First World War saw a rapid process of consolidation, or grouping, as it was called, which created what were described as the “big four” companies. These were the Great Western Railway, GWR; the London, Midland and Scottish Railway, LMS; the London and North Eastern Railway, LNER; and the Southern Railway, SR. The companies were created by the Railways Act 1921, which came into effect on 1 January 1923. A quarter of a century later, on 1 January 1948, the companies were nationalised to form British Railways as a result of the Transport Act 1947. However, during the Second World War they had been effectively united when operating efficiently under the direction of the Railway Executive Committee, albeit that there had been no investment during that period.
Many regard the interwar years as the golden age of the railways, notwithstanding their poor economic performance; throughout that period, the LNER never made a profit. During that period, the engineering works at Crewe, Derby, Doncaster and Swindon provided the locomotives and rolling stock for their parent companies. They also profited from exporting their products in quantity to Africa, India and South America.
The romance of the railways was sustained by the magnificent main line express trains such as the “Flying Scotsman” of 1923 and the “Mallard” of 1938, which were both LNER locomotives designed by Nigel Gresley. Also memorable was the LMS “Coronation Scot” of 1937. That romance was in the mind of John Major when he oversaw the denationalisation of British Rail, which began in 1994 and was virtually complete by 1997. He relished the revival of the names of the big four. The process resulted in seven, later 25, rail franchises. The number is now down to 17, albeit that there are fewer controlling companies or consortia. These include companies partly or wholly owned by various national rail operators, including those of Italy, France, Germany, the Netherlands and Canada.
Since the beginning of privatisation, many of the train operating companies have ceased to exist, for reasons that include the withdrawal or expiry of the franchises, the bankruptcy of the firms or their mergers. In 2004, Labour, on perceiving the inefficiency of the system, decided to reduce the number of franchises to align them with the structure of Network Rail, which maintains the railway infrastructure. The costs of the fragmentation and disorganisation of our rail system that have resulted from its privatisation are evident from comparisons that can be made with the efficient, nationally owned rail systems of some European countries.
The privatisation of 1994 saw the creation of a separate organisation charged with the maintenance of the railway infrastructure. That was Railtrack, which operated from 1994 until 2002. It owned the track, signalling, tunnels, bridges, level crossings and all but a handful of the stations. Many of the operations were outsourced to other companies. The consequence was that the infrastructure fell into disrepair and the state of the rail track was blamed for two major train accidents. The company was eventually taken into public ownership under the title of Network Rail.
Another problematic feature of the privatisation has been the creation of the so-called rolling stock leasing companies, or roscos, which own the locomotives and carriages that are leased to the franchise owners. There are six rolling stock companies operating in Britain, as we have heard, three of which own 87% of the rolling stock. They are owned by consortia, structured in complicated ways, which embody a large proportion of foreign capital. These consortia derive substantial profits; according to a document of the RMT rail union, between 2012 and 2018 the roscos passed a total of £1.2 billion in the form of dividends to their parent companies or consortia.
These companies are motivated to prolong the life of the rolling stock. It is notable that the average age of the rolling stock rose from 16 years in the first year of privatisation to almost 20 years in 2017-18. The rolling stock companies have no obligation or incentive to maintain a steady and co-ordinated stream of new orders for rolling stock. Their failure to do so has been to the detriment of our native manufacturers, which have also passed into foreign ownership and been subject to a series of takeovers and closures. The roscos might continue to lease their trains and rolling stock to a nationalised rail network for as long as they are serviceable, but there is no reason why they should be relied on to purchase new equipment. Such purchases should be made exclusively by Great British Railways, the new publicly owned authority.
All the major political parties have called for the reintegration of our rail system, albeit that the Conservatives have been coy about calling it renationalisation. The process will entail a massive reorganisation, which will take time. The current Bill, which is the first small step, does little more than relieve the Minister of the obligation to invite competitive tenders from parties proposing to run sections of the system. Placing the system under a coherent central direction which can address strategic matters will relieve the Minister for Transport of the continual interventions, described as micro-management, that have been necessitated by the disjointed nature of the privatised system. This will enhance the efficiency of the operations. At the same time, it should facilitate regional planning within a wider national framework, which should be able better to meet local transport needs.
It has been observed that the process of renationalisation, as far as it concerns the train operating companies, will be virtually costless. The franchises will fall into the Government’s hands when they expire. Already ScotRail, Welsh railways, the east coast main line, TransPennine, Northern, Southeastern and the Caledonian Sleeper are in public ownership. The Department for Transport currently controls these train operators via rail transport’s operator of last resort, which is known unaccountably by the initials DOHL. Someone might explain that to me; I cannot find what those initials signify. Although it is proposed that the expiring franchises will fall under this umbrella, there is an allowance in the Bill for the extension of franchises in case DOHL finds itself overwhelmed in coping with its new acquisitions.
It seems that there is no intention at present to nationalise the rolling stock companies, presumably because to do so would be too costly. However, control must be exercised to ensure that there is a steady stream of orders to support the train manufacturers in the UK. The three firms that are manufacturing trains in the UK—Alstom, Hitachi and Siemens—are in foreign ownership, and each can fulfil its orders by manufacturing its trains elsewhere. The Government must guard against the ever-present danger of losing our train manufacturers.
Britain was the original railway nation—it began its railway exactly 200 years ago—but, since its privatisation, the nation has been in danger of losing ownership of its rail system. The hope is that we can repossess it, at least in part. The system has been widely subject to a predatory profit motive. By alleviating that, one can expect a better return for taxpayers’ and passengers’ money. Even greater gains are in prospect, which should come from reducing the inefficiencies of a disjointed and dislocated system.
Lord Fairfax of Cameron (Con)
My Lords, this Bill and this debate are primarily about passenger railway services but, with the permission of the House, I shall say a very few words about a closely connected form of transport. As a resident of the Isle of Wight, I will talk about the ferry companies serving the island. One of those companies is Wightlink, which, as some noble Lords may know, was part of British Rail before it was privatised. The new Government say that one of their key priorities is to have a much better integrated UK transport system, and there has been much talk in this debate about putting the passenger first, but so far only rail and buses are included in their plans. Why not ferries too?
The UK is a collection of islands, so ferry travel is essential for many, but cost is also a key consideration, including for families deciding whether to visit islands. Noble Lords may be surprised to hear that, when visiting the Isle of Wight, non-residents of the island are sometimes charged as much as £300 per vehicle in super-high season for a return journey lasting 45 minutes. I suggest that the Government should intervene to ensure minimum service levels, with price caps and subsidies where necessary. I have personal experience of the lack of joined-up timetabling between the rail company—South West Trains—and the ferry company serving the Isle of Wight, especially at night and in the winter.
On the Isle of Wight we have—and will continue to have, without government intervention—a situation where rail and bus services on the mainland and on the island are connected by a private ferry company loaded with a lot of debt but with few operating obligations. Buses and trains are currently subsidised so why should Isle of Wight residents and visitors to the island have to pay unsubsidised fares that are sometimes exorbitant, as we have heard? I hope that the Government, when considering what to do with passenger railways, will also take a close look at the ferry companies servicing our islands, particularly the Isle of Wight, for the sake of the passengers.
Lord Whitty (Lab)
My Lords, I thank the noble Baroness, Lady Blake, who is not her in place at the moment, for her introduction, which explained this Bill to me rather more than what was evident from the text. I congratulate all three Members on their maiden speeches. My noble friend Lord Cryer is not in his place but I remind him, given his praise of Gladstone, that, according to Gilbert and Sullivan, the parliamentary train was an extraordinarily slow beast; he should bear in mind that that was not quite the flashy new railway we hope to introduce.
Like my noble friend Lord Liddle and various other noble Lords, I have an ideological commitment to a nationalised railway system. I believe that the railways, together with the water sector, are the worst examples of privatisation. Others I can live with but, with those two, I cannot. This week, we see the preliminary Bills on both. We are not going for the nationalisation of water, as I understand it—I had hoped otherwise—but we are going to make some radical changes. We need to: both of those models of privatisation have utterly and completely failed.
My recollection of the comparison with British Rail is not the one on which I heard the noble Lord, Lord McLoughlin, expand. My pre-Beeching memory of British Rail as a lad was that the railway down to the south-west was dual-tracked, regular, uncrowded and cheap, while the food was actually quite nice. These days, none of those things applies; indeed, South Western Railway has decided to abolish food on trains altogether and the journey is much less pleasant. We may not be able to go back to those halcyon days but I hope that we have a coherent policy for the subsequent stages of this return to a nationalised system.
I will not comment greatly on those terms—I had a lot of questions I was going to ask, but most of them have been asked and I hope they will eventually be answered—but, on the central issue, the only way in which to get the railway system to work is to have some degree of controlling mind and some degree of consistent management across the various bits. It does not matter how many entities there are, how many private companies there have been at various times or how many public companies there are going to be; somebody somewhere has to oversee the totality, both of the infrastructure and of the running of the system.
On most journeys of more than a few miles there is a change. Most passengers are utterly frustrated by the way in which the railway timetable is run, by the system for booking seats and buying seats on the day, and by the way in which there is no integration between the different parts of the network. That needs to be addressed. It can be addressed only by a relatively integrated oversight, and I believe that has to be within the public sector. I agree with the Government that the majority of cases need to see a public sector authority there.
The noble Baroness, Lady Scott, referred to the passage of the Transport Bill of 2000. I was a junior Minister on that Bill with my noble friend Lord Macdonald of Tradeston. We did not include nationalisation in that Bill. My noble friend Lord Prescott did have inklings in that direction, but the Treasury and No. 10 turned him down. Instead, we invented the Strategic Rail Authority, which did not work. We now need a system that works. I hope that the subsequent stages of the renationalisation of the railways sees a system that works.
Two issues have hardly been mentioned, except indirectly. My noble friend Lord Balfe—I call him my noble friend because we are both officers of BALPA—mentioned the industrial relations side. The workers have not been mentioned to any great degree, yet we have one of the most skilful, long-standing and long-serving structures of employment in the railway industry. We have one of the most heavily unionised sectors of industry, which has been badly mismanaged by Governments of all sorts and by private companies in the past. We need a new start in industrial relations in the railway industries. That is not just a question of making sure that the leaders of the unions are not too left-wing; I do not believe the unions—or at least their membership—are that left-wing. They just want to play a positive, constructive part in the running of the railways.
Many years ago, when I first worked for the TUC and was made secretary of the transport committee, I was told that the previous general secretary of the TUC, George Woodcock, had wanted the transport committee to end up with one union for the railway industry. We did not quite get there, and that was in 1970, but we could now have a relationship between the nationalised entity, the trade unions and the individual companies which looks forward for strategy, for planning and for engagement of the workforce, which has never been seen properly in the railways since the very early days of British Rail.
The other group, of course, are the consumers, whom we have talked about. I have also been a consumer champion. We have never seen a strong consumer organisation for the railways. Transport Focus does its best, but we need to have a representation of the voice of consumers in the future of the railways that is properly financed and supported by the industry and the Government. At the moment, all that consumers are left to do is to be frustrated—I was going to use a different word—by the way in which their complaints are dealt with. What they want is an organisation which has the strength to convince the management to alter the system in favour of consumers. At the end of the day, the passengers are vital to the railways, and the railways ought to recognise the importance of keeping the consumers happy and making sure that the system works for them. If we do not do that, we do nothing.
Baroness Randerson (LD)
My Lords, this has been a very wide-ranging debate. We have strayed across the world, as far as Japan, and as far back as Gladstone. It is worth mentioning that Gladstone was born before rail systems were invented. It has been an excellent and well-informed debate. How could it be otherwise, as so many speakers have had considerable experience in the rail industry? A whole gallery of ex-Secretaries of State have spoken as well.
I must start by congratulating those noble Lords who made their maiden speeches today, including, of course, the insightful contribution from my noble friend Lady Pidgeon. Her considerable experience as chair of the transport committee of the Greater London Assembly will clearly add considerably to our analysis in this House of the transport challenges we face. I also congratulate the noble Lords, Lord Cryer and Lord Grayling, on their contrasting approaches to the issues.
Contributions from these Benches have made it clear that the Liberal Democrats are agnostic about who owns what within the rail system. Our priorities reflect the concerns of the travelling public—indeed, of the public who would like to travel but all too often find that they cannot, because current systems are too expensive, too slow or too unreliable to be a viable option. I agree with the noble Lord, Lord Liddle, about the possibilities of public-private partnerships. The noble Lord, Lord Young, raised a very valid question about how to unlock private investment in a nationalised railway system.
We strongly support the Government’s intention to overhaul the system as a priority, but we are concerned that they have chosen to focus on re-nationalisation as a starting point. Their chosen method—allowing each franchise simply to die away at the end of the contract period—may superficially seem a clever way of enabling a relatively low-cost renationalisation but, as other noble Lords have said, it will still come at a price because it will create uncertainty, not least for staff. Ironically, the worst performing train operators, for example Avanti, may by chance be allowed to survive much longer than much better operators such as Greater Anglia. My noble friend Lady Scott made this point. We are in danger of having to wait over four years before some vital aspects of reform can be implemented.
My noble friend Lord Bradshaw once told me about working for British Rail through the years of stagnation, as staff waited for privatisation and worried about their jobs. The Government are in danger now of repeating that, but in reverse. Most of us here are old enough to remember that the old British Rail was not a shining example of success. It is important to remember that our rail system now carries twice the number of passengers; it is a very different beast, so we cannot simply go back to the future. Undoubtedly, the first stress the Government will face is to reconcile the terms and conditions of staff as they bring together very different working practices across the train operators. I ask the Minister: how do they intend to implement TUPE in a way that is affordable to passengers and taxpayers? How will they ensure that they keep the best staff when redundancies are inevitable?
As we look across Europe, there is a wide range of ownership patterns, although most countries have a mixed market, as we do here in the UK. The UK is not out of step on ownership; where we are out of step is on reliability, cancellation levels and fare levels. We have, as many noble Lords have mentioned, by far the most expensive rail journeys in Europe. UK fares are the highest, and the cost to taxpayers in subsidies is 30% higher than in any other country.
I say to the Government: the public do not care who owns our railways. They just want a good, reliable service with a simple fare structure that is value for money. Can the Minister give us details of government plans to reform fares? I appreciate that this is something for the future, but the Government must surely have plans in place. Fares need to be frozen in order to start providing a better deal for long-suffering passengers. Privatisation per se is not the problem; as several noble Lords have mentioned, it is fragmentation.
Compare this system with Transport for London, as my noble friend Lady Pidgeon did. Transport for London operates as a co-ordinated service but with a great deal of private sector input. All London buses look the same and operate to the same standard model, but they are run by different companies. The people of London I have talked to are blissfully unaware of that, because of the system. As my noble friend Lord Bradshaw said, the current UK railway system, introduced under privatisation, was overly bureaucratic and focused on the blame game. It is not about ownership but the way it is structured and the internal reaction between the parts of the whole.
During this debate, noble Lords have raised many unanswered questions, and my noble friends have drawn attention to what we regard as the key issues we are looking for answers to, and which the Bill, of course, does not begin to provide. My noble friend Lady Scott raised the issue of safety, which is not a problem on our current railway system but must not be ignored for that reason. The Government appear to believe that open access can continue alongside nationalised services. We need a detailed explanation of how that will work in the future. Who will decide what open access services can be provided?
My noble friend Lady Pidgeon raised the issue of devolution. As Liberal Democrats, we believe strongly that local areas generally know best what services they need, so we want transport devolution to thrive in the new system. We will be looking for cast-iron guarantees that renationalisation will not lead to even more Whitehall-centric control and decision-making than we already have. The noble Lord, Lord Liddle, referred to the concentration of power in the current system.
My noble friend Lady Brinton raised vital issues of disability access. In this shake-up, we must not allow to pass by the golden opportunity we have considerably to improve access for people with disabilities. We must use this opportunity to spread best practice.
If we are to move to a greener Britain, rail freight has to prosper, yet the freight sector is untouched by this Bill. We need to hear more about government plans, and the noble Lord, Lord Berkeley, emphasised the need for investment in freight.
How will the British Transport Police be funded in the future? Currently, it is funded by the TOCs. What about stations? Currently, they are largely, but not exclusively, leased to train operators. Possibly the strangest omission from the Bill and the Government’s stated plans is what happens to the roscos, which, as many noble Lords have mentioned, have been earning extremely high profits, despite all the problems facing the rail industry.
The noble Lord, Lord Moynihan, told us the story of the transformation in Wales. As a Cardiff resident, I agree wholeheartedly with him that significant changes are happening in Wales—it is a useful story that noble Lords should look at in detail—but I stress that it has needed considerable investment.
In conclusion, from these Benches we congratulate the Government on finally starting to tackle the mess on our railways. It is a national embarrassment that the country that invented rail travel can no longer manage to build a new line to modern specifications —I refer of course to HS2. Since the Williams report, the previous Conservative Government twisted and turned, dithered and delayed, and wasted billions of pounds by doing virtually nothing. Great British Railways should have been fully up and running by now, and a simpler fare structure should also have been fully implemented—but we have seen no progress. Instead, they got hooked on being the motorists’ friend and talked only of how much they were subsidising the railways.
I hope that the new Government will change the rhetoric and talk instead about investment in our railways. That means investment in our economy, which simply cannot grow or function properly on our crowded islands without better rail infrastructure. We need that for both passengers and freight, and we need investment in our environment to reduce carbon emissions. That should be done by extending our rail infrastructure.
Renationalisation was a Labour manifesto commitment, and we accept the Government’s right to implement it. But, by asking the questions I have outlined—and some more—we will seek to probe the crucial details of the Government’s vision for rail and to find out how it will work in practice. We hope that constructive probing will improve the final result.
Lord Moylan (Con)
My Lords, I congratulate all those who made their maiden speeches in this debate. They made excellent speeches and will make a great contribution to the House in the future. The noble Lord, Lord Cryer, referred to 1920s capitalism. I look forward very much to having a drink with him one evening, I hope, and discussing the very different attitudes that capitalism had to free markets in the 1920s. I remember that Lord Ashfield, who chaired and brought together the London Transport system in the private sector over a period of 30 years, could hardly bring himself to use the word “competition” in his shareholder letters. If he did, it was always coupled with the adjective “wasteful”, normally following the verb “eliminate”: “We must eliminate wasteful competition”, he said quite nakedly to his shareholders. His attitude to free markets and that of Mrs Thatcher must be regarded as two very different aspects of capitalism, not easily confused.
I also welcome the Minister to her place, and I thank all who contributed to the debate. It is invidious to mention any names, but I want to select the speech of my noble friend Lord Young of Cookham, who set out with great lucidity the problems that privatisation was meant to address. If privatisation has to a degree failed, by whatever measure we choose to apply to it, his essential point was that the problems have not gone away. They are essentially the same problems, and the Government will have to come up with different solutions to them. So far, we have seen nothing of that.
We can all agree that reform of the railways is necessary to some degree. The last Government initiated that process with the Williams review, which contained many detailed recommendations—on fares, ticketing and other matters, for example—that I imagine will appear in the promised rail reform Bill next year, or whenever it appears. Given that it is several years since Williams reported, I am surprised that the Government need a further year to bring that Bill forward. My fear is that, as with the last Government, the complexities involved may be so great that we never actually see it and that, importantly, today’s Bill, far from being an interim measure, could end up being a sort of permanent state.
The Williams review was widely welcomed cross party, and the part of it that is most relevant to this debate and the Bill is concerned with the structure and franchising of the railways. As referred to by the noble Baroness, Lady Pidgeon, the model envisaged by Williams was based on a successful model used by Transport for London for all its services, other than London Underground, which is directly provided. That model differs from the current arrangements for national rail. The key difference is that the fares risk is carried by Transport for London, in contrast to the rail privatisation model, which sought to transfer that risk to the train operating companies. That aspect of rail privatisation has never worked well, because it turns out that fares risk is closely linked to the economic cycle: as the economy booms, more people take trains and, if there is a recession, fewer people do so and the fares fall. That is a well-demonstrated economic phenomenon, but the train operating companies are totally incapable of managing it; they cannot manage the economic cycle.
As each franchise has been renewed over time, we have seen the Department for Transport agreeing contracts and franchises whereby more and more of the fares risk remains with the Department for Transport and, therefore, with HM Treasury. This process was brought to its ultimate logical conclusion by the pandemic, when there were no fares at all and all the fares risk was transferred to the Department for Transport, where it has largely remained under the contracts that have been renewed since then, even as passenger numbers have picked up, with the fares going straight to the Government.
By contrast, the TfL model leaves the private sector responsible for managing the risks that it is actually equipped to manage. For trains, buses and trams, this means having them in the right place at the beginning of every day, pointing in the right direction and with the appropriate staff on them, to an agreed standard of cleanliness—all the things that train operating companies are good at managing. If they fail to manage them properly, they receive a financial penalty. This system demonstrably works, which is no doubt why its adoption on national rail was recommended by Keith Williams as a former TfL board member, as indeed am I.
However, that was not what the unions wanted. I do not like to bring the unions into this after the minatory comments of my noble friend Lord Balfe—I am actually quite friendly towards trades unions—but I want him to reflect for a moment that one of the objectives of the unions and one of the consequences of the Bill is that, if there is a national strike on the railways in the future, his ability to get to Cambridge by one of the three alternative lines that currently serve him, and which allow him to escape the effects of a strike on one line, will be taken from him. He would be marooned in Cambridge and unable to put his services at the disposal of your Lordships’ House if there were a national strike, which is of course the power that the trades unions would like to be able exercise.
That part of the Williams prescription has been junked, and instead the phrase “single employer” has crept into the debate, appearing in Labour documents. There is to be a single employer with single terms and conditions; that is a very different thing from Williams and does not have cross-party support. We are moving from a tried and tested system, recommended by Williams and tried and tested by TfL, to one that is not tried and tested at all—or, if it was, it was in the period of the Attlee Government and the 1950s. The Government run the risk that the logo of Great British Railways will be the curly British Rail sandwich, which some of us are old enough to remember.
The logic behind the Bill is not without merit—there is a case for it—and it is that the network effects of the railways require a single controlling brain, but that single controlling brain largely exists at the moment. Following the scrapping of the Strategic Rail Authority, it sits explicitly in the Department for Transport, which awards the franchises, runs the system and is the controlling brain. The creation of Great British Railways is an admission that the Department for Transport has failed in that role. But having a single controlling brain does not necessarily mean that you need a single operating arm, as TfL illustrates.
There are logical inconsistencies in the Bill’s approach, the first of which relates to devolution. If there is an argument for a single brain to control a single national network, how does that fit with devolution? As several noble Lords have asked, how does it fit with a system whereby, in London, the most congested and busiest part of the network, you will have two competing networks? You will have a network run by TfL, using the private sector, and a network run by Great British Railways, often with services on the same tracks, from which the private sector is going to be banned. How can the private sector be unacceptable on some services on those tracks but perfectly fine on others?
The Government have no coherent answer to the question about London or what they are going to do. They could say that they will just leave it alone and not do anything with it, but of course the mayor has been accreting responsibility to himself for additional lines in London over time and he wants more—and there is an argument that he should have more. Are we to see a moratorium on the movement of responsibility for lines from Network Rail to the mayor? Is it all going to be frozen just as it is? Are we going to allow that process to continue, or are we going to reverse it in the interests of having a single controlling brain and the logic that exists behind Great British Railways? We have absolutely no idea. Even if all the services provided by TfL were not provided by the private sector, the logical question of having two different brains would still arise.
The other problem is to do with open access. The Government say that they are in favour of open access, but logically they should not be if they believe in a single brain and a single operating arm. Many of us are sceptical about whether they are truly committed to open access. On the other hand, as my noble friend Lord Young of Cookham pointed out, in the European Union open access has been pursued with great vigour in recent years under European Union law that has mandated it. Incidentally, the direction that we are going in is a Brexit bonus—I do not think that the Government have fully appreciated the difficulties that they would have had with this enactment if we were still a member of the European Union.
We have a report here, published only in August by the European Commission, on the benefits that have accrued from open access. It finds that
“where competition is more mature, the following effects could be noticed … Lower fares … Potential cost reductions … Increased frequencies”
and improved services. Specifically on fares, the report says:
“On average ticket prices have decreased by 28% on the selected case studies due to a non-incumbent operator entering the market”.
The Government have decided to turn their back on all that. Perhaps the cool reception that the Prime Minister had when he met Mrs von der Leyen not so long ago followed his explaining to her that he was about to exclude from access to British railways the many European companies that operate on them already and might want to bid for services in future. That might explain a great deal—I do not know.
As the debate has made clear—the Government have not really denied it—this is a rushed Bill. The result of that, as we are told in the impact assessment that accompanies it, is that there has been no time to look at alternative models. It says:
“The Bill has been prepared to enable swift delivery of a Government manifesto commitment”—
not to improve matters for passengers—
“As such, it has not been practicable for the Department to undertake the usual long-listing process”
of options that might be legislated for instead. That is what we are getting: a rushed Bill with no alternative solutions. Yet the debate today in your Lordships’ House has indicated an appetite for that.
I have tried to address the broad principles underlying the organisation of the railways. It has been suggested that this is a trivial and tiny Bill and that all the serious discussion will happen in a year’s time, or whenever the rail Bill comes. But actually, as the debate has made clear, this Bill is pregnant with huge consequences for the future, which is especially true if it gets pushed off further and further into the future. Even if the Government meet their timetable and have a Bill in front of your Lordships’ House 12 months from now, it will still take several years to implement it in practice. What we are setting up today could be the shadow arrangements that we live with for many years—but we have heard no serious discussion from the Government about issues such as performance monitoring and accountability.
I have mentioned devolution and open access. We do not understand where the investment is going to come from in future, a question repeatedly asked by noble Lords. At the end, the noble Baroness on the Lib Dem Benches brought in the important question of industrial relations and terms and conditions, but we do not know how that will work when people are TUPE-ed across to government employment. What is the cost of that going to be and how is it going to be affordable? Furthermore, what is the consequence of bringing the pension liabilities of the train operating companies over on to the government balance sheet, and what effect will that have on public finances?
There is an opportunity for us to discuss all those things in Committee, and I look forward to doing that when the time comes in a couple of weeks.
Baroness Blake of Leeds (Lab)
My Lords, I thank everyone who has participated in this very rich debate. I pay particular tribute to our three excellent maiden speeches. Well done to all three noble Lords. The reputation of the noble Baroness, Lady Pidgeon, on the London Assembly comes before her; I know that she is a fearsome scrutineer, and I very much look forward to working with her.
I have to be honest: the noble Lord, Lord Grayling, has brought back some very painful memories. The last one concerned Leeds Bradford Airport—he was so positive about us getting a station next to it. Unfortunately, as I am sure he is aware, it is still on the drawing board. It reminds me that when I became leader of Leeds City Council, I had no idea how much of my time would be taken up discussing rail. Transport, yes, but rail: it was quite an extraordinary time.
I really welcome my noble friend Lord Cryer and thank him for his wonderful speech. Of course, coming from West Yorkshire, I took my kids on the Keighley and Worth Valley Railway. I worked very closely with my noble friend’s mother, for whom I have the hugest admiration; she is such a strong and powerful advocate of support for vulnerable women in particular.
Before I move on, I want to reference the narrow scope of the Bill. Of course, we will explore many of the issues in Committee, but I ask for patience: a lot of the debate will take place on the main Bill when it comes forward. As we have heard, this is one of the first major pieces of legislation from this Government, delivering a manifesto commitment, and I feel very privileged to speak for the Government at Second Reading. I am very grateful to all Members who have given their support to the Bill, while raising very pertinent questions. I welcome the comments of the noble Baroness, Lady Jones, the noble Viscount, Lord Hanworth, my noble friends Lord Faulkner and Lord Liddle, and many others. Of course, I am also very grateful for the support of my noble friend Lord Hendy.
Going back to the beginning of the debate, I thank the noble Lord, Lord Bradshaw, for exposing the problems and all the good points he made. I thank my noble friend Lord Faulkner for recognising that the Bill’s being introduced so early in the legislative cycle is a real demonstration of the Government’s commitment. Obviously, we would like to continue the briefing sessions we have had thus far. Several speakers have questioned the case for public ownership, and we acknowledged and expected that. I will keep making the point that the privatised railways are simply not delivering for passengers or taxpayers. We cannot keep doing the same thing over and over again and expect a different result.
I am afraid that a culture of failure has been tolerated, although I acknowledge that there are exceptions, as raised by the noble Lord, Lord Balfe. Our approach has clear public support. Just last month, a YouGov survey found that 66% of people nationally agree that railway companies should be run by the public sector, and only 12% favoured private operation, as referenced by my noble friend Lord Browne. As we have heard, there is broad consensus about the need to end the current fragmentation and refocus the whole railway system on serving passengers and freight users. The Williams Rail Review, which we have heard about, commissioned by the noble Lord, Lord Grayling, shared these aims, and Keith Williams himself agrees that public ownership should deliver better integration.
My noble friend Lord Liddle hit the nail on the head regarding the delays in implementation: simply too many years have gone by with no action. We have had so many reviews, and now I am delighted that we are here talking about how we can start to move things forward. I have outlined some of the progress that has already been made in public ownership, turning around the performance of franchises that have failed in private hands. Public ownership means that the whole railway can pull together for the benefit of passengers, instead of different companies, as we have discussed. Public ownership will also pave the way for the wider railways Bill and for Great British Railways, properly integrating track and train. I do not think we can repeat this point enough. This would simply not be possible under franchising, or even under the concession model operated by Transport for London, as outlined by the noble Baroness, Lady Scott.
I shall give a few examples of what an integrated, publicly owned railway might mean in practice. First, we are looking at decisions about when to close the railway for essential maintenance—this can be so chaotic. It needs to be planned in a joined-up way, taking account of the needs not only of the engineers and those doing the work, but also the needs of passengers, minimising both the cost and the disruption involved.
Secondly, it will allow us to fix the delay attribution regime, which has created a wasteful industry of arguing over who is to blame for delays and moving money between Network Rail and train operators to compensate. Great British Railways will focus on identifying and tackling the causes of delay, making services more reliable.
Public ownership will allow us to address the overcomplicated fares system. We have heard several comments about the fares system today. It confuses passengers, erodes trust and actually turns people away and prevents them taking the services that they could and should take. It will help us avoid repeating the unintended consequences of franchising. As an example of the waste and inefficiency, I point out that at least four passenger train operators each has its own train crew depots in Newcastle alone, duplicating the costs of mess-rooms, management teams and other overheads. Keith Williams’s review found that there were around 75 different types of passenger train. This is an inefficient way to run any transport system and means that there is no consistency for the passenger. Such examples are repeated right across the system.
My noble friend Lord Faulkner gave a great exposé of what needs to be done to achieve modal shift: how we actually persuade people to get out of their cars or not to take the domestic flight. On integration, railways have been in a difficult environment for so long. Again, I was very pleased to meet my noble friend in Leeds for the first time, at the Middleton heritage railway—his passion for that came through in the debate today.
The noble Baroness, Lady Pidgeon, raised important points about the accessibility of the railway and the inconsistent assistance offered by different train companies. I have heard the noble Baroness, Lady Brinton, speak on the subject before: her passion and determination to make progress are touching and informative, and I really that hope everyone stopped to listen. Another unintended consequence of the fragmented system is that it can be so much more difficult than it needs to be, especially for disabled people. She raised important points about accessibility and, most importantly, the inconsistent assistance offered by different train companies.
Although there has been some improvement over the last few years—for example, the new two-hour booking window for assistance and the Passenger Assistance app—the proliferation of different booking systems means that, too often, customers still do not get the assistance that they have booked, and certainly do not get the assistance they deserve. This issue exists across all areas, including the number of different train designs, which all require different adjustments from disabled people. Over time, public ownership will allow us to meet passengers’ needs in a more coherent, consistent way.
I was disappointed that the noble Baroness, Lady Grey-Thompson, was unable to attend the beginning of this Session, but I am delighted she is here today. Her extraordinary commitment is a testament to the power required to bring the change we need. I know the Rail Minister has met with her about her recent experience, and I pay tribute to her for raising the public profile through what happened to her. It is so important that these stories are told, heard and, most importantly, acted on. As we know, the train operator concerned, LNER, is conducting a formal investigation into that specific issue. I also know that the Secretary of State and the Rail Minister will take a keen interest in ensuring that the findings are fully and swiftly acted on.
Baroness Brinton (LD)
Will the Minister agree to meet both of us to discuss other issues, such as the apps and the inconsistencies between the train companies? Things are not quite as shiny and rosy as she was describing them.
Baroness Blake of Leeds (Lab)
My apologies. I was not trying to make things out to be shiny and rosy; I was just trying to say there was a proliferation of different types. I would be delighted to meet with both noble Baronesses.
I also reassure the noble Baroness, Lady Brinton, that Clause 2 simply provides that services must be secured by awarding a contract to a public sector company. It does not prevent us from improving services or terms if needed. There is nothing to prevent services being changed for the better when they come under public operation.
We have heard a great deal about actual performance. I will pick up on the aspects raised by several Members today. The noble Lord, Lord Young, made comments about strikes, for example. Every time the noble Lord, Lord Balfe, speaks, I think we pay tribute to his experience with the unions and the issues they bring. The noble Lord, Lord Whitty, also asked questions on this subject. The approach has to be to work with the trade unions rather than against them. As the experience of the last few weeks has shown, we have already drawn a line under two years of industrial action, allowing train operators to get on with delivering the improvements that are so badly needed. It is not rocket science and it needs to be recognised and taken seriously.
We have heard about the impact on private investment. The noble Earl, Lord Effingham, raised his concerns about this. I do not believe the premise that the approach will stifle private sector investment. Since the start of the Covid pandemic, the costs of operating franchise passenger services have been borne by Government, not by private train operators. That means that private operators no longer fund their own running costs or investments. We have to really ask ourselves how much real private investment is coming in at the moment, and of course we need to encourage it where we can. I have already highlighted the financial savings to the taxpayer from no longer paying fees to private operators. Public ownership will improve services while reducing the cost to the public purse. I absolutely acknowledge my noble friend Lord Berkeley’s comments about value for money.
I draw attention to my noble friend Lord Liddle’s comments about transparency, oversight and scrutiny. I reassure him that the contrast is published so it can be seen. I am more than happy to circulate a copy to anyone who would like to see it.
The noble Baroness, Lady Scott of Needham Market, raised the issue of staffing when services transfer. To operate services successfully in the public sector, it is vital that existing staff transfer with them. The regulations—commonly known as TUPE—are designed to achieve this outcome, preserving key terms and conditions for staff as they transfer. These regulations will apply to future transfers from private to public operation, as they have done previously. There might just be a small number of people who do not transfer, as we have heard—for example, if they are seconded into a train operator from another employer. This process, combined with the expert staff already working in DOHL, will ensure that both strategic and operational roles are filled by people with the right experience to succeed. We have heard fears expressed around continuity, and I hope my answer undermines that point of view. Continued access to the railways pension scheme will also be assured, as it has been in previous transfers to public sector operation.
Many points have been raised in the debate about the Government’s plans for reform beyond this short Bill, including the arrangements for Great British Railways. I know that Ministers will enjoy debating these issues further with noble Lords and others as we develop our plans and once the further railways Bill is before your Lordships’ House. Although that debate is for the future, I am grateful for the views expressed today. I reassure the noble Lord, Lord Moylan, that the appetite for this debate is real and urgent; we can feel the great enthusiasm for moving the agenda forward.
I also reference the comments made by my noble friend Lord Tunnicliffe around growth and how we can bring all these issues together. The issues that the noble Lord, Lord Moynihan, raised about sustainability, ecology and other environmental matters will be fundamental.
I will give some more reassurance: Great British Railways will be operationally independent, with day-to-day decisions made by professionals and experts, not politicians. It will not mark its own homework. Our proposals will ensure sound oversight, and we will consult on them so that noble Lords and others can consider them and share their views. The Office of Rail and Road will continue in its role as safety regulator, building on its world-leading record in this area.
Let me also reassure my noble friend Lord Tunnicliffe and the noble Baroness, Lady Randerson, that we are proceeding with this Bill first so that we can start the process of bringing train services in-house. As I have said, it is expected that the Bill will come forward in this Session when parliamentary time allows. It is a priority. Again, I reassure my noble friend Lord Tunnicliffe of the wider issues that will come together when we discuss this.
There has been a great deal of concern about freight. The Bill sets out specifically to end the franchising of passenger services, so it has no impact on rail freight. However, there is a crucial future role for freight businesses, so the railways Bill will require Great British Railways to enable the growth of rail freight. The Secretary of State will set an overall freight growth target to ensure that it remains a key priority.
Many issues were raised about this not being centralised and the fact that devolution is absolutely critical. I will comment on my noble friend Lord Whitty’s concern about passengers as consumers. The proposed passenger standards authority should help to reassure the voice of passengers, as we have said all the way through.
I think we have dealt with the constraints of the contracts put in place for poorly performing operators, such as Avanti. I assure the House that the Secretary of State will not hesitate to act if the contractual conditions for early termination are met. We cannot burden the taxpayer with the cost of compensating private operators for otherwise ending their contracts early.
I am absolutely sure that we will come back to discussing rolling stock in Committee. I recognise the concerns raised and comments that have been made. I thank my noble friend Lord Hanworth for his contribution and reassure my noble friend Lord Snape that we are not bringing rolling stock back into public ownership.
Once again, I thank all those who have spoken today for their thoughtful contributions. It has been encouraging to hear the broad consensus in favour of industry reform to put the passenger and freight user back at the heart of our railways. I am pleased to be here today to get the reform on track. This Bill will allow us to start bringing services back into public hands, providing the strongest possible foundation for our wider programme of reform.
Passenger Railway Services (Public Ownership) Bill
Monday 21st October 2024
(1 month ago)
Lords ChamberRead Full debate Passenger Railway Services (Public Ownership) Bill 2024-26 Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: HL Bill 21-I(a) Amendments for Committee (Supplementary to the Marshalled List) - (18 Oct 2024)
Lord Gascoigne
“Purpose: improvement of passenger railway services(1) The purpose of this Act is to improve the performance of passenger railway services in the United Kingdom.(2) The Secretary of State must, in taking any actions under the provisions of this Act, have regard to this purpose.”Member's explanatory statement
This amendment requires the Secretary of State to have regard to the purpose of improving passenger railway services when taking any actions under the terms of this Act.
Lord Gascoigne (Con)
My Lords, in moving my Amendment A1 I will speak also to Amendment 48A in this group. First, with permission, as it is the first time that I have addressed the new Minister in the House, I congratulate him on his promotion—I think it is a promotion—in joining the Government. I have had the absolute pleasure of working closely with him and knowing him personally since 2008. I saw at first hand his sterling work when he ran Transport for London, alongside the equally impressive Mayor of London, Boris Johnson—something on which I know the whole Committee will agree with me. There are few people in the land more knowledgeable, so it is the country’s gain in having the Minister help tackle our many transport issues.
I declare that I am a regular commuter, and have been for years, travelling in and out of London from home almost daily—not least today, when I had a 15-minute delay to a 25-minute journey. It is because of my time as a commuter, as well as my time in London City Hall, working alongside TfL and many others, and my time in Downing Street looking at rail reform, that I am speaking today.
I turn first to Amendment A1. I do not intend to rehash the universal view that something has to change when it comes to our rail services, and I shall park temporarily whether I believe that the Government’s plan in this Bill is the right one. For now, I will take them at their word and do them a favour by setting out at the outset what this Government believe that the Bill will achieve. It is worth reminding ourselves that the Labour manifesto said that the Government will
“put passengers at the heart of the service”.
In April, the then shadow Secretary of State, who is the current Secretary of State, said in Labour’s Plan to Fix Britain’s Railways that:
“Public ownership for our railways is about the practical need to deliver better services where they have failed”.
My amendment tries to encapsulate that in something concise, setting out that the overall aim of these reforms is improving service. It does not set out every promise that the Government have made in trying to deliver these reforms, such as saving tens of millions of pounds and having more affordable tickets and even better mobile connectivity—more power to your elbow on that one. Amendment A1 is simple, short and streamlined. The Bill would open with what its purpose is and what the goal is, so that, in effect, like Ronseal, the Bill does what it says on the tin.
Some have already quizzed me on whether this purpose clause is necessary in the light of the Bill’s tight scope and focus solely on the effect of nationalisation of passenger rail services. In answer to that, I draw the attention of the Committee to those clauses relating to the temporary extension of privately run franchises. In that part of the Bill, it is clear that the Secretary of State will have to make a judgment on whether it is practical for a service to be provided by a public sector operator. With the addition of the purpose clause and the connected duty, the Secretary of State will have to have due regard to the improvement of passenger services under the Bill when making these decisions.
Turning to my second amendment in this group, Amendment 48A, as I have already said, and as was well covered at Second Reading, no one can deny that the current system is not working. It is fraught with endless delays and cancellations, yet year on year we have fare increases, so my amendments today are not done to halt reform of the railways and certainly not done from an ideological position, even if it has been said that the Government are driving this policy for ideological reasons. For me, it is quite the contrary.
Lord Grocott (Lab)
My Lords, I will be brief. As the focus of this is on passenger travel and the noble Lord’s desire to put that at the centre of the objective of the Bill—which is a laudable objective shared, I am sure, by the Government—I cannot help pointing out that one of the major decisions by the last Government, which will of course affect the capacity of the railway network to deliver first-class passenger transport, was their in my view crazy decision to truncate the HS2 programme.
That programme was introduced by a Labour Government, supported by the coalition Government and by Conservative Governments over a period of about 15 years in total and at two strokes—first, getting rid of the Leeds link and, secondly, getting rid of the Manchester link—so much planning, expenditure and work was wasted. I am sure my noble friend the Minister will agree with a lot of this. It means that, among other things, the service to passengers, which is at the heart of the noble Lord’s amendment, is bound to be diminished from what it could have been. The network was there to provide passenger transport, freeing up space on the west coast mainline, which is close to, if not beyond, capacity, and helping freight as well, of course, which is a very important part of what the rail network delivers. It would have enabled that by freeing up the west coast mainline, the old mainline, if you like, built by the Victorians and still doing remarkable work, and improving the network overall.
So, when he winds up, I really would like the noble Lord to take the opportunity to apologise on behalf of the Government he served for making those nihilistic decisions to scrap that section of the railway. Ironically, in an attempt to justify the action they took, they claimed that somehow several billion pounds would be saved and one of the ways the “saved” money would be spent—I think the figure was £9 billion—would be on filling potholes. Now I am strongly in favour of filling potholes, but it will not help passenger services on the railway—which the building of the two northern legs of HS2 would have done. So, as welcome, in many ways, as his emphasis is—I do not know whether it is on behalf of the Opposition or not—on supporting and improving passenger services, that has a long way to go to make up for the damage it did by the cancellation of HS2 north.
Lord Grayling (Con)
My Lords, I rise along with the noble Lord, Lord Gascoigne, as someone who has worked closely with the new Minister. I congratulate him on his appointment. He knows more than almost anyone about our railway network—the problems, issues and challenges—and, while he may find himself on the other side of the political fence to me, he will be a great asset in trying to sort the challenges of our rail network.
He will know, very much more than anybody else, what the challenges are. He will also know, therefore, that sorting out our railways is not simply about changing the ownership structure. He knows full well, for example, that many of the issues that passengers have experienced in recent years have been laid at the foot of Network Rail—the company he chaired, although it was not his fault, of course—and rightly so. However, all of us involved bear the scars from the difficult times in 2018 with the timetable change. The noble Baroness, Lady Blake, knew well the challenges then, particularly in her role in the north. In the north, they were caused most immediately by Network Rail’s failure to deliver an electrification programme in the timetable that had been committed to, which had a dramatic knock-on effect on the rest of the railway.
Therefore, I am not clear, and it is why I have a lot of sympathy with the amendment from the noble Lord, Lord Gascoigne, why a move of ownership is going to deliver a transformation for the passenger. I hope that the Minister, with his experience, will be able to talk a bit about that as he responds to the debate. Fundamentally, on both sides of the House, we are all about improvement for the passenger, and simply transferring ownership from public to private and private to public does not solve the challenges. Ironically, I was reading at the weekend—and I am sure it is true—that the Government are looking at bringing the private sector in to run Euston station, at the same time it is planning to take the private sector out of the railway to run the trains that go into it.
So I would be grateful if the Minister could set out why he thinks this change will deliver improvement for passengers and why, therefore, the amendment being proposed by my noble friend is wrong.
Baroness Randerson (LD)
My Lords, I am in the slightly unusual position of speaking to Conservative amendments that have not been spoken to already. However, I am sure the noble Lord, Lord Moylan, will correct me if I interpret them wrongly.
The noble Lord, Lord Gascoigne, set out the failures of the current system. Prior to the laying of the noble Lord’s amendment, I had taken the theme of this group of Conservative amendments as displaying a welcome, if overdue, conversion on the road to Damascus. After more than a decade of increasing confusion on railway services, declining levels of passenger satisfaction and rocketing fare prices, the Conservatives are actually looking at improving public train services.
Amendment 2 touches upon something with which I definitely agree: the inevitable winding-down effect of a four to five-year transition period. As I said at Second Reading, there is bound to be an impact on staff morale and the inevitable likelihood is that the best staff will move to other industries when faced with an uncertain future. There will also, of course, be cost pressures. For example, there is bound to be a tendency to level up across very different terms and conditions from one employer to another within the train operating companies. Last week, I was speaking to some train operating companies, all of which recognised the problems that will be faced as the Government try to bring together and harmonise terms and conditions without exposing the taxpayer and the passenger to higher costs. Of course, the most obvious problem is how to deal with rest day working. I know the Minister is fully aware of the problems to which I am referring, so I will be interested in his response.
Amendment 26 refers to costs. At Second Reading, I asked questions about several issues, such as station ownership and operation, which were not really answered. I also asked about British Transport Police, which is encompassed in Amendment 40, put down by the Liberal Democrats. The Labour manifesto contained a supposedly cunning plan for low-cost nationalisation, but there are still bound to be significant costs for such obvious things as new livery and uniforms. We all look forward to an integrated fare structure; that, of course, will come with upfront costs.
Amendment 22 refers to the establishment of an independent public body to assess performance, while Amendment 21 refers to an annual report from the Secretary of State. I hope that the noble Lord, Lord Moylan, will explain exactly what he is aiming at in these amendments. One of them asks for the sort of close supervision by the Department for Transport that we have had since Covid, which clearly has not worked terribly well; the other refers to a more arms-length approach. Which of those approaches does the Conservative Party in this House believe will be better?
Liberal Democrats would establish a railway agency —a nationwide public body to act as a guiding mind for the railways, putting commuters first, implementing wholesale reform of the fares system and holding train companies to account. We do not believe that the renationalisation of passenger rail will automatically deliver cheaper fares or better services. From speaking to members of the public, we have concluded that they really do not care who runs the railways; they just want cheap, efficient and reliable services.
I do not doubt the Government’s good will or their wish to make this huge change, which we all want to happen. However, as a signal of their intent and an upfront signal to the public, I hope the Minister will speak with the Chancellor of the Exchequer to ensure that in next week’s Budget, we have a fare freeze and the public see from the start that there will be a difference under this Government.
Lord Berkeley (Lab)
My Lords, the amendments in this group are all designed to try to get some information from the Government about the effect of the changes in this Bill. Will it help the passenger—as well as, I hope, the rail freight customer—and will it help with the costs? Several noble Lords have referred to the issue of costs on the railway, which is very serious; I shall probably come back to that later.
Lord Lansley (Con)
My Lords, I will briefly ask the Minister a question for when he comes to respond.
I am very supportive of what my noble friend says in his Amendment A1—that we be clear about the purpose of this legislation—but the Minister will be aware that the Bill will substantially achieve that by amending the Railways Act 1993. Section 4 of that Act, as amended, sets out the general duties of the Secretary of State and the Office of Rail and Road. While they are listed in relation to the Office of Rail and Road, they are added as duties of the Secretary of State under Section 4(3)(a).
Section 4(1)(zb) says that it shall be the duty of the Office of Rail and Road—and, by extension, the Secretary of State—
“to promote improvements in railway service performance”.
Will the Minister confirm that nothing in this Bill would change the continuing duty of the Secretary of State to promote improvements in railway service performance?
Can the Minister also say that it will not change the duties of the Secretary of State and the Office of Rail and Road otherwise listed in that subsection, including
“to promote competition in the provision of railway services for the benefit of users of railway services”.
I am interested know precisely how the Minister and the Government propose to meet that general duty, which is not changed by this Bill.
Lord Snape (Lab)
My Lords, I am always fascinated when Members of the party opposite attack proposals from this side of the House on the grounds that they are ideological. What could be more ideological than the privatisation of the railway system back in 1994? In my view, Amendment A1, to which the noble Lord, Lord Gascoigne, spoke earlier, would create another bureaucracy—something the Conservative Party are normally against. No one would say, and I certainly would not, that a nationalised railway will be the answer to all our problems. Having worked in it, I know only too well it will not be. On the other hand, I think if you asked the average rail passenger for his or her view of the current system, they would say that anything would be better than what we have at the present time.
When it comes to ideology, I followed with interest the words of the noble Lord, Lord Grayling, who talked about failings in the increased cost of electrification leading to the delay, and in some cases the cancellation, of various electrification projects. My noble friend the Minister, who will respond, has great experience of Network Rail, and he might comment on some of the costings—many of us would take an interest in those matters. I was surprised, to say the least, at some of the expensive projects that Network Rail has embarked upon and the failure of that organisation to work within the original estimates, as far as costs are concerned. I hope it will not upset the noble Lord, Lord Grayling, too much, but his sojourn as Secretary of State for Transport is not looked upon by the railway community with any great favour. His view that in some cases electrification was unnecessary and that what was needed was bi-mode trains did not particularly please passengers. I recently moved home, from the Birmingham area to Gloucestershire, where I now have the pleasure—doubtful pleasure that it is—of travelling on Great Western’s bi-mode trains. They are often subject to cancellation and, again, the usual view from my fellow passengers is that the sooner the railway is renationalised, the better.
My noble friend Lord Berkeley is regarded as an expert on railway costings—he shakes his head, but he should not be so modest; he certainly played a major role with his views on HS2 and its finances. He mentioned the Office of Rail and Road. In the context of this amendment, can my noble friend the Minister tell me what role is envisaged for the ORR in future? I hope he will not be too offended if I say it is a misnomer: it is certainly an office for railways, given that it intervenes on various grounds—in my view, improperly, because there are proper roles for those responsible for railway safety in the industry—but appears to play no role at all as far as the road network is concerned. The fact that something approaching 2,000 people are killed on our roads on an annual basis is not something that detains the ORR. I hope my noble friend can tell me what role he envisages for the ORR in the newly nationalised railway system.
Finally, just to hark back to 1994 and the privatisation Act, fundamentally it adversely affected the railway industry. In 1994—again, I apologise for the history lesson—the railway system in Britain was regarded as the most efficient and effective in western Europe; certainly the subsidies paid to the rail industry in those days were less than those paid in countries such as France and Germany. The sectionalisation of the railway industry in the 1990s, largely at the behest of a Conservative Government—I do not make any complaints about that, as Governments have opinions—led to a much more readily identifiable system of costings for the industry overall. For the first time, we saw exactly which parts of the railway were profitable, which were not and which needed perhaps more money spent on them in the future than had previously been envisaged.
The relationship between Sir Bob Reid mark 1, the then chairman of the railways board, and Mr Nicholas Ridely, the Secretary of State at the time, was an extremely fruitful one. I am not here to announce any great fondness for Lord Ridley but I think that he appreciated what the railway industry was doing, largely at his behest at that time. I understand—although I do not wish to attribute words to him long after his death—that he was more than a little concerned about the mode of privatisation envisaged by the Government at the time, largely because of the success that he felt he had had in improving and defining the railway industry’s relationship with the Government of the day.
I hope that, when my noble friend the Minister responds to this amendment, he will appreciate at least that, whether the railways are privatised or public, all too often railway passengers—or customers, as they are somewhat laughably known these days—do not feel that their views on the provision of the service are listened to or that there is a proper voice for them. It is some years since the transport users’ consultative committees were abolished. Can my noble friend say what plans he has for better passenger consultation in the future?
In conclusion, I hope that my noble friend will not get too bogged down in the bureaucratic desires of the party opposite. Future amendments that we will come to, from the Conservative Party or its Front Bench, appear to believe that railway management has nothing better to do than put together various plans, which no doubt will be torn apart by those who feel that the railways are not delivering the service that they should. I await with interest my noble friend’s response to the amendment. I know that he will bear in mind that we ought to be concerned about the passengers of the future—the passengers of the past having been sadly neglected.
Lord Sterling of Plaistow (Con)
My Lords, trade moves by trains. Why do I bring that up? Some of your Lordships may remember that when Freightliner was put up for sale, P&O—the Peninsular and Oriental Steam Navigation Company, to give its full name—bid for it, and we were told by the competition authorities that, at that time, we already controlled 25% of transport movements for the whole of the UK and therefore we could not take it over.
I went to see the Secretary of State for Transport and everybody involved with this—our own people—to say that it was ridiculous. In practice, what we really wanted was to have a fast line for container trains, at night as well as in the day, from Glasgow right the way through to Istanbul, non-stop, for 2,500 miles, moving trade backwards and forwards in a major way. We had only about 3% of the trade in Europe, and I thought that, at that stage, it would have made a huge amount of sense. With those double trains going right the way through and the movement of trade, we would now be in a much finer position for doing trade in a much more major way, 2,500 miles away and further. I thank your Lordships for listening to me.
Lord Morgan (Lab)
My Lords, I would like to intervene because I frequently travel on the railways of France; my wife is French. The contrast between the railways in France—and, for that matter, in Italy—and those of this country is quite extraordinary. The railways were aptly referred to by my colleague on the Back Benches as a shambles and so they have been. It is therefore highly important that we have a properly integrated and effective service, which has been part of the tradition of infrastructure of this country for a very long time. I cite someone whose name will register on the other side of the House: Winston Churchill. He was, in his time, a strong supporter of the nationalisation of the railways, partly on efficiency and technical grounds, based on his experience in Lloyd George’s coalition Government of the First World War, and partly on grounds that, fortunately, we hear less about now—questions of labour and industrial relations; I think the railways were almost next to the miners in industrial conflict in that period. We suffer by comparison with our neighbouring country colleagues—and, I hope, shortly, allies—and therefore the social and economic rationale of this Bill is profoundly important.
Lord Moylan (Con)
My Lords, I start by apologising to the noble Baroness, Lady Randerson, if I caused any confusion; I will try to do better. I welcome the noble Lord, Lord Hendy, back to his place from his excursion, no doubt by rail, in foreign parts. We missed him at Second Reading, but we had an excellent substitute in the shape of the noble Baroness, Lady Blake of Leeds.
I will make a preliminary remark at this stage, which I intend to save me making it on future groups of amendments. It is that we are, essentially, at least as far as the amendments tabled by Members from the Conservative Party are concerned, seeking information from the Government in relation to this Bill. If the Government are candid with us and give us the information that we are looking for, we will have achieved our objective on behalf of the public, and that will be the end of the matter.
I turn to the debate that has taken place so far. The part that has sparked me most, which I felt I had to answer, were the remarks of the noble Lord, Lord Snape. First, I agree with him about what a degradation it is that passengers have become customers when, of course, they really ought to be passengers. But there is also the question of ideology, which I hope to take out of the debate that we will have in Committee today and on Wednesday.
Of course there is always an element of ideology when one talks about privatisation and nationalisation. The railways, which, I think, are 200 years old next year, have been nationalised for only about a quarter of their entire existence. We must not think that nationalisation is the natural condition of railways in this country. They flourished and grew and were developed in private hands; we should always remember that. The truth is that in 1945-46, the railways were nationalised largely because, after six years of war, they were bankrupt. There had been no investment in them during the whole of that period, and they had deteriorated. Nor was there any prospect of their making sufficient profit that private capital could have been recruited to make up that deficiency.
Whether the then Government believed in nationalisation as an ideological matter or not, if the railways were to continue running at all it was going to have to be in government hands. Parts of the system were privatised in the mid-1990s for equally practical reasons—we discussed some of them at Second Reading. One reason was to attempt to improve customer service through competition; one was to recruit private capital into the railways on a consistent basis, which the Government had never been able to provide during the whole of the time they owned the railways—not enough capital and never enough consistency because no budget went beyond 12 months—and another was to try, frankly, to break the grip of the rail unions on pay, so that the astonishing disparities that exist between, let us say, a train driver and bus driver, which are entirely due to the monopoly supply of labour by ASLEF, might be evened out.
What we discussed at Second Reading, I am perfectly happy to admit, is that on some of these fronts privatisation has been successful, and on others less so. If the Government, who have won a majority on the basis of promising to nationalise the train operating companies, wish to give the other side of it a kick and see if they can make it work on that basis, I do not personally object—at least not on ideological grounds. But the House is perfectly entitled to have its practical questions about how this will work addressed. That is what the amendments in this group and many that will come before the Committee later intend to address.
The Government claim that this is a very small Bill. On the other hand, when they talk to the public it is a huge Bill, “because we are nationalising the railways”. They are not really nationalising the railways, because to nationalise something you normally have to pay for it and this Bill is not something where they are paying out to shareholders. All they are doing is letting the franchises that exist expire and then tying their hands and preventing themselves from renewing them except in emergency circumstances. It is, as I would have said at Second Reading if I had had more time, less nationalisation and more like dismissing your chauffeur at the end of his contract and deciding to drive the car yourself. At least you knew the chauffeur had a driving licence and some experience and qualification in driving the car, but now we will have the Secretary of State—we were told at Second Reading that she prefers to be known as the passenger-in-chief—as, in effect, driver-in-chief as well. We will see how that works out.
It is a big thing when the Government talk to the public—it is nationalisation of the railways—but when they talk to noble Lords it is a very little thing. All the big things, we are told, will happen in the next Bill— the train further down the line, expected in roughly a year or 18 months. That is the Bill in which many of our questions should be addressed, we are told—we should not ask those questions now. I think we should ask many of those questions now, for two very good reasons. The first is that the Bill presents us with a measure regarded by the Government as preliminary to that very large Bill, so it has long-term consequences. The second—a point made by the noble Baroness, Lady Randerson—is that the Bill sets up a shadow structure that could persist in operation for four or five years or even longer because, first, it will take us a year or 18 months before we see the Bill that will make these great reforms; and, secondly, as anyone who has been involved in the railways or any other large organisation will know, implementing significant change as a result of that legislation is likely to take several further years. We will have to live with the shadow structures set up as a result of the Bill for many years, and their practical consequences deserve the most careful scrutiny.
Lord Moylan (Con)
I am not quite yet the Minister, but the way the Labour Party is going, who knows?
Lord Snape (Lab)
I asked for that one, I have to say. It is mistakes being made at both ends of the Corridor recently.
Arising from what the noble Lord has just said, can I ask him to clarify two points? First, on the delay in moving on to the more detailed Bill, bearing in mind that it was 2016 when the Government he favours brought forward the proposals for Great British Railways, what were the Government doing in the eight years since then? Secondly, I have a simple question about the ideology of privatisation: if nationalisation is so bad, why was almost the first act of Governments in two world wars to nationalise the railway industry? What makes it so essential in wartime and yet it can be handed out piecemeal in peacetime?
Lord Moylan (Con)
If the noble Lord will forgive me, I am asking the questions in this scenario, and I do not feel I necessarily have an answer to his question about wartime. I might pass it on to the Minister, who once arranged for me to go and see deep in the bowels of Mayfair, under the former Down Street Underground station—I am sure that if the noble Lord, Lord Snape, has not been, it can be arranged for him to see it too—the wartime headquarters of the railway operations executive, including what is claimed to be, although I think with no historical foundation, a tin bath in which Churchill once took a bath. I will say no more about the war than that.
On the former question, I do not know the answer, but I would like to know. Why was it that the then Government, having published what they called the Williams-Shapps review written by Keith Williams—I think he is correct in saying that it was in 2016—and having promised a transport Bill in the King’s Speech one but last, did not come forward with the measures they thought they could offer in that regard? I do not know the answer to that, but I am willing to have a guess and it is relevant to what the Government are embarking on now and to whether they are going to meet their 12 to 18-month deadline of delivering us with this massive Bill that is going to transform the railways. My guess is that the then Government found that grappling with the intense difficulties of reforming the railway on such a large scale meant that, try as they might, they found considerable difficulty in putting together that Bill. It may be that is exactly what the Minister finds as he comes to address these difficulties. This only adds further to my point that the shadow arrangements we are setting up today could be with us for a very long time.
I come to the first amendment in the name of my noble friend Lord Gascoigne. The Government say they have a purpose—they are not doing this for ideological reasons or at the behest of the trade unions—which is to improve passenger services. At Second Reading, I pointed out that in the final stage impact assessment produced by the Department for Transport, given the opportunity it had to say exactly that, it said something completely different. It said that the Bill had been
“prepared to enable swift delivery of a Government manifesto commitment”—
not to improve matters for passengers—and that was why it had not looked, as it normally would, at the alternative options that might be put forward to achieve a similar purpose. That is another reason why it is incumbent on us in this House to look in great detail at what the Government are putting before us. They are in effect asking us to buy into an article of faith. They are simply saying, “Well, it couldn’t be worse than it is at the moment”—that is simply untrue; there are problems with the railways, but they could be a great deal worse than they are at the moment—“so it is bound to be better if we take it over and run it ourselves as part of a national enterprise”. But they have not provided any evidence for that; they have simply stated, “This must be the case and you’ve got to believe us”. As I say, that is one of the reasons why our job is not to do so.
Lord Liddle (Lab)
Can I try to help the noble Lord? My understanding is that the Government are committed to a comprehensive package of rail reform, and that the Bill for the comprehensive package will be introduced next spring. The purpose of this Bill is a relatively minor reform, in my view, in the context of the much bigger reform, which is to make sure that the franchises can transition to public ownership at minimum cost to the Exchequer. If we are going to do it at minimum cost to the Exchequer, we have to do it quickly; that is why this is one of the earliest Bills that the Government have put forward.
Lord Moylan (Con)
The noble Lord puts the Government’s case very well. How much the House has lost in not seeing him on the Front Bench as the Minister, given that he was the shadow Minister up until the general election.
We are told by the noble Lord that the Government have a package of reforms. We all have a package of reforms. We know what the package of reforms looks like; it is in the Shapps-Williams review. Yet what we are seeing from the Government is a package of reforms that differs significantly from the Williams review; that is why it needs such careful scrutiny.
Given the passage of time, I will be brief on the remaining amendments. All the amendments in my name seek to test the effects of this measure on the performance of the industry in the light of the nationalisation that the Government are proposing.
Taken separately, the amendments deal with different types of performance. Some deal with the performance of the railways in so far as they engage with passengers; that is, on timeliness, efficiency, service quality and so forth. Some relate to the performance of the railways in relation to finances; we will come to finances in more detail later. The Government claim that this Bill has no financial consequences—there are those of us on this side of the House, including the noble Baroness, Lady Randerson, who treat that approach with great scepticism. Other amendments seek to examine the measure’s effect in relation to the performance of the network as a whole.
I hope that all these amendments will be accepted by the Government. If they are to make these changes, there needs to be transparency and the public need to be able to see metrics published, possibly by an independent body or possibly by the Department for Transport—we are open to persuasion on that—which show how the railway is performing.
Having come to power committed to transparency, I know the Government would not want to resile from that. So, if they are not able to support the detailed amendments as tabled, I expect that the Minister will have no difficulty in saying that the Government will put forward amendments on Report showing how this Bill will be monitored in its implementation.
The Minister of State, Department for Transport (Lord Hendy of Richmond Hill) (Lab)
First, I thank the noble Lord, Lord Gascoigne, for his welcome; it is nice to see him again in different and more august circumstances—different, at least, from those that applied in the old City Hall. I thank him, and the noble Lord, Lord Moylan, for their explanations of this group of amendments, most of which require some form of reporting or assessment of the impacts of public ownership or the performance of publicly owned operators.
Like my noble friend Lord Snape, I am fascinated by the plethora of reports proposed at this stage of railway reform. Given that LNER has been in the public sector for six years, and Northern for four, it is strange that the measures now proposed for public sector train operators were never contemplated or enacted by the previous Government, who clearly never thought that they needed them. In simple terms, this Government do not either.
I welcome the support of the noble Lord, Lord Gascoigne, for railway reform. His Amendment A1 does not call for any reports but requires the Secretary of State to have regard to a specific purpose —to improve the performance of passenger services—when exercising functions under the Bill. I entirely support that purpose, and it is at the heart of what we are doing, but there are also many other purposes: stripping out inefficiency and waste on behalf of the taxpayers who fund the railway, simplifying fares and increasing patronage, connecting communities, driving economic growth and promoting opportunity for all. It is not right that the Bill should suggest that it has only that one purpose, important though it is.
Amendment 2, tabled by the noble Lord, Lord Moylan, would require the publication of two reports: the first outlining the anticipated impact of public ownership, and the second assessing its actual impact some years after the event. Regarding the first of these reports, the Government have already fulfilled the proposed obligation through the impact assessment published earlier in the year. Among other expected impacts, the taxpayer will no longer have to fund many tens of millions of pounds in fees currently payable to private sector operators each year, even when their performance is sub-standard. Furthermore, public sector operators will prioritise the interests of passengers and taxpayers, not the demands of their shareholders.
A similar report is envisaged in Amendment 48A, tabled by the noble Lord, Lord Gascoigne, but focused specifically on the impact on performance. I can assure the noble Lord that the Government certainly expect public ownership, and our broader reform proposals, to unlock the significant improvement in the performance and efficiency of the railway which he is looking for; we do not need to publish a report to say that.
Turning to the second proposed report envisaged in Amendment 2, there is no need to wait for three years before we start to consider whether train operators’ performance is improving. A wide variety of data is already routinely published about the performance of both public and private sector train operators. This includes reliability and punctuality, service quality, customer complaints, financial performance and efficiency, among other measures. This Bill does not change any of that, but as part of our wider reform plans, we will further improve access to data. This will be specific to individual routes and/or service groups, not just aggregated at the level of whole franchises, so that passengers can see at each station how services are performing on their local routes and, importantly, what is going to be done to improve them.
The Government can and will monitor performance closely on a continuing basis. We will hold operators’ feet to the fire when their performance is inadequate, irrespective of whether they are privately or publicly owned. The Secretary of State and I have already demonstrated that we will not accept the poor standards that have been tolerated in the past. We have demonstrated that from our first days in office by holding meetings with the managing directors of several train operators alongside their Network Rail counterparts to address poor performance and demand immediate action to raise standards.
In that respect, in answer to the noble Lord, Lord Grayling, we are not discriminating between the public and private sectors and will not do so, as indeed he did not in his time. He rightly gave me a hard time in 2018 in respect of electrification in the north-west of England; even if it was not Network Rail’s responsibility, it related to the failings of GTR as an operator.
Amendment 26, tabled by the noble Lord, Lord Moylan, would require the publication of a further report—or perhaps 10 reports, one after each transfer—setting out the expected impact of the transfers on various aspects of train operators’ performance. Again, once transfers have taken place, it would be more instructive to consider the actual performance of train operators.
Amendments 21 and 22, also tabled by the noble Lord, Lord Moylan, would require the reporting and independent assessment of the performance of publicly owned train operators. That is unnecessary because, as I have set out, the Government will themselves be monitoring their performance closely and will work to ensure that as much performance data as possible is published for the benefit of the travelling public, in a form that is useful to them and that allows for effective scrutiny.
My department is currently reviewing the standard terms of the service agreements that are entered into between the Secretary of State and public sector operators, in readiness for future transitions to public ownership. Public operators will be set targets in key areas such as punctuality and reliability and other aspects of the service. Work is under way to identify the right targets and measures for the period ahead in order to focus operators on delivering the best possible outcomes for passengers and taxpayers. As part of the service agreement review, we will consider the arrangements for publishing those targets and operators’ actual performance in comparison to them.
Amendment 22 refers to performance improvement plans. I reassure the noble Lord that improvement plans are already a feature of the Government’s service agreements with each public sector operator. I confirm for noble Lords that similar mechanisms will continue to exist in future, both through contractual terms and through the controls that DOHL exerts over its operators on behalf of the Secretary of State. As I have said, where performance is falling short, we will not hesitate to demand that things are put right, regardless of whether the operator is privately or publicly owned.
Amendment 45, tabled by the noble Lord, Lord Moylan, requires the publication of an independent assessment of the performance and efficiency of the rail network five years after the enactment of this Bill. By that time, the Government will have established Great British Railways, which will have taken over responsibility for both track and train. New arrangements will need to be put in place to oversee and scrutinise the effectiveness and efficiency of GBR, so in due course we will set out our plans for holding it to account as part of our plans for the wider railways Bill. We should not pre-empt those future arrangements by seeking to legislate for them now.
I hope we will deal with all the noble Lord’s other points during the rest of Committee, as we shall with the detailed comments of the noble Baroness, Lady Randerson, on staff morale and the British Transport Police. In answer to the noble Lord, Lord Lansley, I confirm that there are no changes to Section 4 of the 1993 Act.
In answer to my noble friend Lord Snape, in the present Bill there will be no change to the role of Office of Rail and Road; he needs to await the substantive railway Bill for that, at least with regard to the railway element of the ORR. There will be public consultation on the wider Bill before it comes, so there is no need to wait until the publication of the Bill itself.
I also say to the noble Lord, Lord Moylan, that there is currently no meaningful private investment by train operating companies, so we are not losing anything in the Bill that is on the table today. Contrary to his assertion about the Williams report, its author, Keith Williams, envisaged public ownership as a necessary condition to rationalise a number of things on the railways, in particular fares, ticketing and information.
Lord Moylan (Con)
My Lords, I am clutching my copy of the Williams rail review in my hands. I think I am going to refer to page 55 at another stage—my eyesight is not good enough to give the quote straightaway —when I will have the opportunity to point out that Williams’s approach to nationalising the train operating companies was somewhat more subtle and differentiated than the Minister has just claimed. But I want to ask him about a different point. It is a genuine curiosity I have about what might be described as the theology of Great British Railways and the new system that the Government are putting in place.
My understanding was that Great British Railways would be the single controlling brain operating the system and using a concession system to do that—let us say it is doing that itself now in the new system. It would be setting the goals of the railways through routes, service frequencies and so forth, and indeed running the fares and ticketing system. It would then be monitoring how these shadow or publicly owned companies were doing. We are now told by the Minister that all the monitoring functions he has referred to, which I would like to see set out transparently in advance through the Bill as being by independent bodies which we can trust, will be done by the Department for Transport. I ask him to be clear with us: in this system, who is responsible for monitoring and to whom is the system accountable? Is it to Great British Railways in its shadow form—now that it has been established and has a chairman, staff, a transition team and so forth—or is it the Department for Transport? The answer to that question has very significant consequences and it appears to be a moving target.
Lord Hendy of Richmond Hill (Lab)
I should respond to the noble Lord on three or four points. First, whatever the Williams report said—and it was adequate in what it said at the time—I took the trouble, only a few days ago, to confirm with its author that he acknowledged we could not change the fares, ticketing and information systems without taking the train operating companies or their activities into public ownership.
Secondly, the noble Lord knows perfectly well how a large public body can behave in monitoring activities, whether it carries them out itself or has contractors or concessionaires to do it, because he will be as familiar as I am with the experience of Transport for London. It monitored its own activities, published them and allowed others to scrutinise them. That principle is the one which should be adopted by Great British Railways.
Lord Moylan (Con)
So is it Great British Railways that will be doing it, like TfL, and not the Department for Transport? I am very confused.
Lord Hendy of Richmond Hill (Lab)
Well, the noble Lord should not be, because it is quite clear to me that the Government intend to take a large amount of activity out of the Department for Transport and put it in a body that is responsible for the performance of the railways. That being the case, it would be extremely logical that monitoring performance is done by GBR but properly scrutinised by others.
Lastly, I simply say to the noble Lord opposite that there has been a change of government. The policies that this Bill and the railways Bill will seek to enact are the policies that the Government were elected to carry out.
Lord Gascoigne (Con)
My Lords, I am grateful to everyone who spoke in what I thought was going to be a relatively brief debate, but I think we have clocked up over an hour and it has become far-reaching, showing the wealth of knowledge in your Lordships’ Committee.
I will cover some of the points that were raised. The noble Lord, Lord Grocott, raised HS2 and my own position. As a northerner, I have my own personal views, but I have to say that I was merely a Whip on the Government Front Bench and, as powerful as I may have been in controlling speaking times from the Dispatch Box, I did not have the power to control spending. It is something I will raise with the Opposition Chief Whip, my former boss, later. With respect, perhaps the noble Lord may want to speak to his own Front Bench about future spending plans. If I may say so, I think the Prime Minister’s own position on HS2 has been perhaps confused over the years.
Turning back to the debate, I think this group was about the future plans covered by this Bill. The noble Lord, Lord Snape, suggested that my Amendment A1 would create bureaucracy, and I think the Minister said that it would not; it is merely a purpose clause. I repeat what I said earlier: my only wish is to make it clear that services will improve.
I am grateful for the Minister’s response, but I would have thought that the Government could have at least supported Amendment A1 as it is a purpose clause. It could demonstrate that the Government do not believe that the Bill will improve services. Although the Minister said at the Dispatch Box that it would improve services, he then listed a number of other things it would do. I do not know if I should take that as meaning that the Government will accept my amendment but also list all the other points they believe it will do as a purpose clause. That said, obviously this will be an ongoing conversation and for now I beg leave to withdraw my amendment.
“25B Termination of existing franchise agreements(1) The Secretary of State must terminate franchise agreements for default in accordance with the terms of the agreement as soon as it is possible to do so.(2) Subject to subsection (1), the Secretary of State must not terminate a franchise agreement pursuant to a break clause unless—(a) there are no other franchise agreements which are—(i) terminable for default or may be terminable in the next three months for default, or(ii) will come to the end of their term within the next three months, and(b) the Secretary of State is satisfied that provision of the services by a public sector company will improve existing service provision.(3) In this section, “break clause” means a contractual provision in a franchise agreement which entitles the Secretary of State to terminate the franchise agreement before the end of the franchise term by notice without reason.”Member's explanatory statement
This amendment would require the Secretary of State to nationalise the worst performing operators first while enabling services that are currently working well to continue.
Baroness Scott of Needham Market (LD)
My Lords, I am sure that all of us want the same thing that the passengers want: a railway which is reliable, punctual and affordable. In too many parts of the country, they have been let down and this has not been delivered. Personally, I can understand why the Government have chosen this way of doing things and improving matters. But I do also think it is beholden on this House, particularly as we are now in Committee, to really focus on the way in which the Government intend to do this. It is in that spirit I move Amendment 1.
I am arguing what I argued in my Second Reading speech—that, in order to make the transition to public ownership a success, the Government should first take on those operators which are demonstrably failing passengers. They should turn those services around to deliver tangible improvements for the travelling public. It follows that the management of currently high-performing operators—as I shall show noble Lords, they do exist—should be retained for as long as possible to ensure that passengers continue to receive good service while minimising costs to taxpayers.
This amendment would require the Secretary of State to first nationalise the worst-performing operators to deliver immediate benefits to passengers and taxpayers, while enabling services that are currently working well to continue for the time being. Specifically, it places the Secretary of State under a duty to prioritise the termination of franchise agreements where the incumbent operator is in default of their agreements and gives them a duty not to terminate non-defaulting franchise agreements early unless there are no franchise agreements to be terminated due to default or because of their expiry. It would also require that terminating such an operator early would improve existing service provision.
I will say a word or two about the railway I use. I have travelled between Suffolk and London several times a week for more than 25 years now, and I can tell noble Lords that my service has never been better. Greater Anglia has spent £1.4 billion upgrading its rolling stock. It returned £65 million to the Treasury in the year ending in March and is predicted to return £100 million next year. It has a 94.8% public performance measure; I think Avanti is currently at 62.2%. Greater Anglia’s cancellations are at 1.4% and Avanti’s at 10.2%, but Greater Anglia’s full term expires in September 2026 and will therefore be one of the first to go.
It is genuinely difficult to see how that performance could be bettered. Indeed, with new management operating and a whole new set of structures it could conceivably get worse, initially at least. On the other hand, the poorly performing franchises have the potential for significant improvement—indeed, that is why the Government are doing this—so by using a strictly chronological approach they risk losing the confidence of the public right at the start of this process.
Current national rail contracts give the Secretary of State powers to act against failing train operators, both in general and where remedial measures are in place, and she has broad rights to information provision about possible contraventions, so could the Minister outline how the Secretary of State has used these rights in relation to CrossCountry and Avanti contracts? The grounds for default under the national rail conditions are passenger service performance, non-compliance with remedial agreements and contravention of other obligations, so has the Minister sought advice on CrossCountry’s and Avanti’s performance in relation to those provisions? Is either TOC in breach of any other provision? With Greater Anglia, West Midlands Trains and East Midlands Railway all performing well, can the Minister say whether they will be allowed to run their full course?
Regardless of where your Lordships stand on the question of renationalisation, in the end, as members of the travelling public, we all want it to work. By taking a strictly chronological approach, which leaves poor performers in place, the Government risk seriously undermining their own flagship policy. I beg to move.
Lord Liddle (Lab)
My Lords, I have an amendment in this group that is closely aligned with the noble Baroness’s, on which she has spoken very eloquently. It would reaffirm the Secretary of State’s powers to, if necessary, withdraw franchises from operators.
I tabled my amendment because I am a strong supporter of the Government’s policies and it would be tragic if we could not complete the transfer of companies to public ownership with remarkably quick speed. Yet, when we had the Second Reading debate, the noble Baroness, Lady Blake, pointed out to us that, unless there was a basis for withdrawing the Avanti franchise, it would run for another couple of years. It would be tragic if the worst-performing franchise, along with CrossCountry, was allowed to continue for this extended period and thereby to delay the Government’s ability to introduce the kind of rail reform that a unified railway under a guiding mind would make possible. To tell you the truth, on the basis of what I have heard, I think our Ministers are being a bit feeble. They could stand up to Avanti with much greater determination than they have.
Lord Grayling (Con)
My Lords, I shall raise a question with the Minister, as we are on the subject of the termination of franchises. I should say to the noble Baroness and the noble Lord that I have been there and wanted to terminate franchises. I have never had a problem with a mixed economy, but I have an issue with a uniform economy, because I cannot understand the logic of terminating a very good private sector provider, any more than the Mayor of London believes in terminating his private provider of the London overground—and I suspect, if we see more devolution in future, other parts of the country may want to see a mixed economy as well. Clearly, the Government are very happy to see that in stations, as we learned at the weekend.
However, it is more difficult than one might wish, and as a Minister you have to take a judgment about how much legal and therefore financial risk you are willing to take, and also about the disruption that the termination brings. Nobody should be under any illusion that making a transition between two operators has to be managed extremely carefully and, done at gunpoint, can actually lead to a deterioration of services.
I come to my question to the Minister. This set of amendments discusses the process of termination of franchises and when and how they happen—the order in which they happen. My memory is that, in a private system, at the end of a franchise, there is a payment to be made by the successor franchise operator to the franchise operator handing over control of that franchise. There are various capital costs and other costs incurred. If the public sector is coming in and saying, “Right, we’re taking over the franchise”, what can the Minister tell us about that equivalent process? Will payments be made to the companies that are being phased out, as there were between private operators? What will those payments be and what will be the total cost incurred by the Government in making those payments? After all, the private operators will have invested in capital aspects, on the stations or elsewhere. Therefore, logically, the Government will also have a legal obligation to go through the kind of process that happened in the past when a franchise simply moved between two private operators. Can the Minister address that specific point in his closing remarks?
Lord Snape (Lab)
My Lords, I honestly believe that the amendment so ably moved by the noble Baroness opposite is extremely sensible. Like her, I can see no reason why we have a chronological system for dispatching the current franchisees based on the run-out date of their particular franchise.
Like the noble Lord, Lord Grayling, I am in favour of a mixed economy. There are certain aspects of privatisation, heresy though it might sound to some of my colleagues, that were successful. The fact that some of the railway system—rail freight, for example, which rarely gets a mention in these debates—remains in the private sector is indicative of the success of those who took what was, under British Rail, a very much declining sector of the railway industry. I do not wish to do an “all our yesterdays” speech, but my recollection of the freight sector in those days is ancient wagons clanking around the system, being shunted from one marshalling yard to the next, and with an average journey speed between loading and destination of around 12 miles an hour. Since privatisation, the rail freight side has improved greatly.
To return to the very valid point made by the noble Baroness, Greater Anglia is not just a success so far as its operations are concerned; it is a financial success as well. Because of this unfortunate coincidence of the run-out date of franchises, Greater Anglia is forecast to repay to His Majesty’s Treasury around £100 million in the current financial year. As my noble friend Lord Liddle said, presumably—unless my noble friend the Minister can reassure us otherwise— we are going to dispatch Greater Anglia to the railway knacker’s yard while pursuing with Avanti Trains, as he and the noble Baroness said, a franchise operator that, quite frankly, should not be there.
The previous Government, in the run-up to the election, were stupid enough—or ideological enough, perhaps—to give Avanti an extra nine-year franchise, on the grounds that it was showing some improvement. Those of us who travelled on Avanti regularly—thankfully, it is an experience that is now behind me since I moved home—could not find any improvement whatever. Indeed, it seemed to me that the service was deteriorating on an annual basis.
Again, it might be heretical for some of my colleagues to hear this, but aspects of the passenger railway that were privatised were successful. At Second Reading, I mentioned Chiltern Railways. Thanks to the financial constraints that British Rail had to operate under as a nationalised industry, Marylebone station was proposed to be a coach station by Sir Alfred Sherman, if I remember rightly, Mrs Thatcher’s transport guru at the time. The existing railway management, again through no fault of their own but because of financial constraints, had to run the service from Marylebone down, single much of the line and reduce the overall train service. Under the able leadership of the late Adrian Shooter, and with a long-term franchise of 20 years, with various break-off points, my noble friend Lord Prescott and the then chief executive of the Strategic Rail Authority came up with this 20-year franchise, but insisted that not only had the service to be improved but some of the infrastructure had to be restored. Under Chiltern Railways, lines that had become single were redoubled, and a pretty poor commuter rail service now has two trains an hour as far as Birmingham—with a price, incidentally, as my noble friend Lord Liddle might be interested to know, which considerably undercuts the fare of Avanti trains.
There are aspects of the future of the railway industry where a mixed economy would make some sense. I hope that, in those circumstances, my noble friend the Minister will look with some degree of favour on the noble Baroness’s amendment.
Lord Berkeley (Lab)
My Lords, the noble Baroness makes some very good points. The Greater Anglia service is awfully good: my two noble friends who have spoken about it have confirmed that, and I have been on it recently myself. However, following the intervention of the noble Lord, Lord Grayling, could somebody from the Conservative Party—maybe the noble Lord, or one of his predecessors or successors—explain the basis on which it chose Avanti and CrossCountry, which are two of the worst performing operators, to be given such very long contracts? I remember at the time there was a big debate between Virgin and Avanti as to which should get the contract. Whatever one thinks about Virgin, it has had some good services in the past, but Avanti is absolutely awful—as is CrossCountry, though for different reasons. Why did the then Government do it?
It is fine to say that we have given it to a private sector operator, but if we end up in a situation where the Government are effectively going to make similar awards to people—not companies, but people—we should know on what basis it is done. I hope my noble friend the Minister can explain what the criteria will be to make sure that we get some decent new franchises and how he is going to get rid of the two existing pretty bad ones as soon as possible.
Baroness Randerson (LD)
My Lords, as a Great Western passenger, I wish I could speak as glowingly as my noble friend Lady Scott has done about Greater Anglia. GWR is known fondly to its passengers as “Great Western Roulette”. Will it or will it not turn up? How late will it be? Will it have five, eight, nine or 10 carriages? I can see people for whom that rings a bell.
The Liberal Democrat Amendment 1 turns on its head the Government’s proposed time-served system, which noble Lords have been discussing. In some ways, Amendment 48, in the name of the noble Lord, Lord Liddle, addresses the same issues. This is really about natural justice. Why should a poorly performing franchise be allowed to continue while an excellent one is terminated? Bear in mind that we are not bothered about the franchise owners; we are bothered about the passengers who have to suffer the service it provides. Why should passengers be denied reliable services?
There are two serious problems with the Government’s scheme. By chance, as has been said by several noble Lords, Greater Anglia, a profitable and very good operator, will have its contract terminated at the start of the process, while Avanti, whose performance is poor, will outlast almost all other train operators. That is topsy-turvy logic. The rail industry will lose the example set by Greater Anglia at a time when it, as a company, could be setting the new standards we all hope will be achieved by the new integrated public sector railway.
By imposing this rigorous approach to nationalisation at all costs, and nationalising even those train operators that are performing very well, the Government’s attitude is really inconsistent. They are not applying the same logic to roscos or freight services, or even to open-access operators. It is simply illogical to insist on the upheaval and dismantling of Greater Anglia, for instance, while regarding an open-access operator such as Grand Central as quite acceptable.
Lord Moylan (Con)
My Lords, I begin by speaking briefly to Amendment 30, standing in my name, which proposes the deletion of the word “reasonably” from Clause 2, line 29. At this point in the Bill, the prohibition on the Secretary of State from renewing franchises is alleviated by this clause in certain circumstances. One of them is where the Secretary of State is satisfied that it will not be reasonably practicable to provide or secure the provision of the franchise service, et cetera.
This is a simple probing amendment, on which I do not want to spend a great deal of time, other than to simply ask what the Government mean by the word “reasonably” here. What is “reasonably” adding to “practicable”? It seems that it is creating potential difficulties for the Government. On one hand, if they were challenged in court about this—I hasten to add that I am not a lawyer—I think they would find that one of the tests they would be put to is whether they had acted reasonably, and that would be true whether the word was in the statute or not. Here, it seems to me that there is a double standard of “reasonably” being applied to them. What do they mean by “reasonably”? In what circumstances do they envisage having recourse to it, and would the Bill not actually be better without it? I would be grateful for the Minister’s comments on those points.
On the substance of the debate, I congratulate the noble Baroness, Lady Scott of Needham Market, on having secured universal approbation for her proposal from all speakers who have spoken today. She wants something that appears to be very common-sensical: that the poor franchises should be terminated and cleared out as soon as possible and before the well-operating franchises are cleared out, so that we do not have a situation where good operators are removed from service while poor operators are left in place.
Yet, because of the rush with which the Government have come at the Bill, and because of their determination to be able to say, “We’ve achieved something in the manifesto as fast as we possibly can”, that is exactly the effect of the Bill as it is constructed. Operators that we know to be poor will continue for considerably longer than those that are in fact performing very satisfactorily. I suspect that the Government will say that this is because they have to terminate franchises at the time they fall due, because to terminate them any earlier would cost public money and they would need to pay compensation. As the noble Lord, Lord Liddle, said, that is of course the legal advice they would receive, though what exactly some of these poor performers would expect by way of compensation is a political question and one that could easily be put to the test, as the noble Lord said.
The other matter here is that the Government already envisage that some franchise contracts, despite the prohibition in the Bill, may be renewed for practical reasons, reasonably or otherwise. It is possible to renew a franchise on a short-term basis. In fact, nearly all the franchises currently operating are operating on very short-term contracts. The financial liability carried with those short-term contracts is very small. So, even if a good performer were to have their franchise fall in very soon, if an appropriate exemption to the prohibition were inserted in the Bill, they could still be kept going on a short-term contract without creating a significant new liability to the Government, while the poor contracts fell in and were terminated without any risk to the Government. If the Government were not in such a terrible rush, all of this would create a logical structure for the termination of contracts which passengers would understand and which would not run the risks that were stated so clearly by the noble Baroness who moved the amendment.
There is a great deal to be said for this. I hope the Minister, when he replies, will not take refuge in simply saying, “Oh, we’ve got no choice because this is what the public finances dictate and it is all driven by finances and contracts”. The management of these contracts—by a confident Government who know what they are doing and a Secretary of State who wants to achieve something and knows the direction in which she is heading—is essentially a political matter. It can be done and the Government should step up to the plate and do this for their own sake if they wish their reforms to get off to a good start.
Lord Hendy of Richmond Hill (Lab)
My Lords, I thank noble Lords for explaining their amendments in this group, which consider some of the practical aspects of the Government’s plans to transfer services to public ownership. Amendments 1 and 48 focus on the contractual arrangements that allow the Secretary of State to terminate a franchise early, following a breach of contract or other sustained poor performance. I make it absolutely clear that this Government will not hesitate to act decisively where an operator’s unacceptable performance means that the contractual conditions for early termination are met. The Secretary of State has made this plain on a number of occasions and I am happy to reiterate it to your Lordships today.
However, I am very much afraid that the terms of the contracts we have inherited from the previous Government do not make this easy. It is far easier for an operator to return the contract to the Government than it is for the Government to take back a contract for poor performance. It is deeply regrettable that in the past couple of years, some of the poorest performing operators have been awarded the longest contracts.
Noble Lords will not be surprised to know that we have looked very hard at the form of the contract. We are closely monitoring train operators’ compliance with their contract, but at present we are not in a position—with any operator—where the Secretary of State has a contractual right to terminate for poor performance. Noble Lords might be amazed to know that Avanti has not yet triggered the need for a remedial plan, although it may well do so. While CrossCountry has triggered the need for a remedial plan, we need to let that work through, together with the timetable reduction that the Secretary of State was deeply reluctant to agree to, before we discover whether its performance then merits some further contractual remedy.
Unless and until that contractual right arises, the only sensible approach is to transfer services to public ownership when the existing contracts expire. Any other approach would require taxpayers to foot the bill for compensation to operators in return for ending their contracts early, which the Government made clear in our manifesto that we would avoid, if only because of the state of the public finances we inherited.
I have also heard representations on behalf of operators—or, rather, their owners—that, rather than transferring services as contracts expire, we should leave their services in private hands for as long as possible. All the owning groups knew of these dates and would have planned financially for them in any event. The concern seems to be that service quality will suddenly collapse, or that current plans for service improvements, or for the rollout of new train fleets, will suddenly grind to a halt.
There is no basis for these claims. DOHL is experienced in transferring services into the public sector smoothly and without disruption, as it has proved in the difficult aftermath of past franchise failures. As services transfer, the same trains will be operated by the same staff as before, and no doubt often by the same management, as happened with LNER six years ago. The improvements that are already in train will continue. I have no reason to think that performance will deteriorate. Extending specific operators’ tenure will simply delay the process of bringing services back to public ownership, where they belong, and the financial savings that will result.
In answer to the noble Lord, Lord Grayling, while there have been transfer costs from franchise to franchise, he will of course recognise that the incoming franchisee would not pay that cost gratuitously; they would simply add it to the subsidy bill for the franchise they were inheriting. In the end, the public sector pays, as it has always done. In fact, since Covid, the operators have not funded anything at all, so the quantum in the future is likely to be extremely limited.
Lord Grayling (Con)
I would like some clarification from the Minister on that point. Has the department added up that liability? Does he have a total number for the transfer into the public sector of all the franchises?
Lord Hendy of Richmond Hill (Lab)
The answer to the noble Lord is: not yet. He will recognise that those costs materialise only when the franchise transfers, so the department will never have had that total number in the past, and I do not expect it to have it now. As the franchises transfer, the number will become obvious.
Lord Snape (Lab)
Before my noble friend leaves that point, I will ask him about the question of performance that has been raised on both sides of the House. The public performance measure national average is 88.7%, but the Avanti West Coast performance measure is only 62.2%—some 25% less. What has to be done to remove a franchisee which has performed so badly, as in the case of Avanti, other than knocking down the buffers at Euston and heading a Pendolino down Eversholt Street?
Lord Hendy of Richmond Hill (Lab)
In answer to my noble friend, and in recognition of some of what I have done in the past, it is sometimes a surprise when you read the performance requirements for contracts that you inherit. This is clearly one of those cases. I cannot defend the statistics that my noble friend cited, and I cannot defend a contract that allows that to happen without remedy.
In answer to the noble Baroness, Lady Randerson, we will come to devolution later in Committee.
Lord Moylan (Con)
I will not pursue the question of “reasonably” at this stage, but I was struck by the Minister saying that the Bill should not trammel the Secretary of State’s power in relation to how she manages contracts and franchises. However, that is exactly what the Bill does in Clause 2. What he wants is the liberty, within reason, of the Secretary of State to terminate franchises. But Clause 2 specifically sets out, in very clear language, a prohibition on the Secretary of State to award a contract to anything that is not a public sector company. It says that she may do so only
“by making a direct award of a public service contract to a public sector company”.
Admittedly, further down the page, there are, as we have discussed and as the Minister said, one or two very narrow exceptions for practicality, or reasonable practicality. But why do the Government feel that the Secretary of State should have complete liberty when it comes to terminating franchises, but is so untrustworthy and unreliable, so enamoured of the private sector and so easily seduced into re-awarding them the contract that there has to be a legal prohibition on her doing it here? All Members of the Committee are asking for is some flexibility in Clause 2 about what the Secretary of State is allowed to do—why not? Can she not be trusted?
Lord Hendy of Richmond Hill (Lab)
The answer is that it is the Government’s policy to take train operations into public ownership. The words the noble Lord mentions in Clause 2 just emphasise that intention.
Lord Liddle (Lab)
I would like to raise another point about Avanti. As I understand the law, the Secretary of State has a clear right to withdraw contracts on the basis of passenger service performance. Is it the case that the present Secretary of State cannot make her own judgment of that and is bound by whatever was decided before the last election? Would a court really not accept that the present Secretary of State has the right to make that judgment and act on it?
Lord Berkeley (Lab)
Before the Minister responds, perhaps I could add something to my noble friend’s comments on Avanti and performance. My noble friend Lord Snape mentioned, I think, a 60-something per cent public performance measure. What we do not know is the difference between delays caused by Avanti itself and Network Rail, the infrastructure manager. GBR will be in charge of the infrastructure as well as the trains, and it is pretty important that we know the balance between the causes of the delay, and how this will improve. Maybe my noble friend the Minister could write to us and give us a breakdown of the performances of the existing services and Network Rail. I believe, at the moment, that Network Rail is responsible for something like 70% of the delays, but maybe I am wrong. I look forward to his comments.
Lord Hendy of Richmond Hill (Lab)
On my noble friend Lord Liddle’s comment, I am sure the Secretary of State would like to make her own decision, but I am pretty confident that the work done in the department to assess whether Avanti is meeting its performance standards has taken into account what latitude there is. I suspect there is very little because of the contract terms.
I will write to my noble friend Lord Berkeley, and make the letter available, about the causes of delay on the west coast main line and to Avanti’s services. It is, of course, as he knows, undoubtedly true that every set of delays on the railway is due to a combination of the train operator and the infrastructure, and the way in which those parties manage their interaction with each other. When the Secretary of State and I have seen train companies about their performance, we have insisted that they are always accompanied by the relevant route directors of Network Rail. One of the issues is the root cause of the delays; another is how well those parties interact to resolve them. One of the issues on the west coast main line is that Network Rail’s control point, not unreasonably, is at Rugby where the signalling system is, Avanti’s control is in Birmingham and its train crews are managed from Preston. I would not run a railway like that myself.
Baroness Randerson (LD)
Going back to the contracts that are performing well, what is the Minister’s view on emergency situations, such as the recurrence of Covid and lockdowns? Would an existing contract, as currently written, enable an extension if the Government felt they needed it, or would they have to come to an end, so that we have to go through a fresh bidding process, come what may?
Lord Hendy of Richmond Hill (Lab)
It varies in accordance with the particular train company. Some of them are coming to a natural conclusion, others have break clauses that enable termination and, in a limited number of cases, there are some choices that could be made. To that extent, we will have to make them.
Baroness Scott of Needham Market (LD)
My Lords, I am very grateful for the support I have received from across the Committee for my amendment. I am not sure I can remember it happening to me before, and I was basking in the warm glow until the Minister stood up to reply. I am sure that all Members of the Committee will be disappointed because, at the bottom of this, we will be renationalising the Greater Anglia franchise with a performance rating in the 90 per cents, and leaving Avanti in place with its performance in the 60 per cents. Whatever the policy or legal niceties, people will be bewildered by that. I have every sympathy with the Minister; the Government inherited a contract that seems to have allowed extraordinary latitude to Avanti for poor performance. I also recognise the twin problem that it has an extraordinarily long franchise, but I am sure that he has heard very clearly what everyone is saying here. The message to him is: please be absolutely sure that there is not some extent to which political will can find a way through this. A failure to deal with this will leave the travelling public absolutely bewildered. With that, I beg leave to withdraw the amendment.
Lord Lansley
Lord Lansley (Con)
My Lords, I rise to move Amendment 3 and speak to Amendment 5 and a number of others in the group. We may find this naturally flows from the discussion we listened carefully to on the previous group. Some of the themes might well re-emerge, not least the question of the desirability or otherwise of a mixed economy in the provision of rail services.
We have just approved, for these purposes, Clause 1. Under Clause 1, we have agreed that
“section 23 (passenger services to be subject to franchise agreements)”
is to cease and that, in future, securing the provision of services will be the responsibility of the Secretary of State under the new Section 30. Clause 2 revises Section 30 for these purposes. At the moment, it is a section about the duty and the absence of franchise agreements, but it would become, under Clause 2, the public sector provision of services.
The other thing that is probably important to note is that under Clause 1 we have deleted the existing Section 25, so that there is now no longer a prohibition on public sector operators—all of which is naturally part of the process of implementing a policy, which, as the Minister has told us, is the narrow objective of the legislation.
Why have I thought it appropriate to bring forward these amendments? They are probing amendments to try to examine whether the Bill, even from the Government’s own point of view, is future-proofed against the circumstances that may arise and the objectives that they may seek to achieve.
Lord Young of Cookham (Con)
My Lords, I will add a footnote to the excellent speech from my noble friend Lord Lansley and note in passing that the Passenger Railway Services (Public Ownership) Bill is running late, with the likelihood of hitting the target of getting to Amendment 11 at a reasonable hour becoming vanishingly small.
This group of amendments is to some extent the obverse of the group that we have just had. The focus of the previous group was on ending prematurely, before the Government would wish, services that were not running satisfactorily, whereas the thrust of this group is to enable the Government to extend beyond the date that they prefer a contract that is running satisfactorily.
In a sense, this is all about ideology. There are two potential views. One was expressed by the noble Lord, Lord Whitty, who on Second Reading said:
“I have an ideological commitment to a nationalised railway system”.—[Official Report, 7/10/24; col. 1883.]
By contrast, in that same debate, his noble friend Lord Liddle—who, as we have heard, was formerly the opposition transport spokesman in your Lordships’ House, said:
“I do not see any ideological objection to public/private partnerships in running the railway”.
He then gave an example:
“You might have a situation where a private company was prepared to commit to electrification plans for a particular line that would not be in the public sector investment plan. My view is that we should allow public/private partnerships on a net additionality rule. If they are going to bring more investment into the rail system, what on earth is the case for not allowing them to do so?”. —[Official Report, 7/10/24; col. 1840.]
Again, in the debate today, the noble Lord, Lord Snape, said he was in favour of a mixed economy. I agree with that approach. If this amendment is opposed, it is because the Government have taken Lord Whitty’s view and they have an ideological commitment to nationalisation—which I thought had been abandoned some 30 years ago under Tony Blair’s leadership.
There has been an argument for flexibility. I want to develop the argument that the noble Lord, Lord Snape, developed about Chiltern Railways and Marylebone station. In the 1980s, Marylebone station was almost moribund. There were a few services to the commuter villages of Aylesbury, Amersham and Chesham, but, in the decade before privatisation, there were proposals from British Rail to close Marylebone. There were also alternative plans to turn the railway into a road. That was before privatisation. Three years after privatisation, 18 miles of single track between Princes Risborough and Bicester North had been doubled. In 2000, the brand new £4.2 million Warwick Parkway station was opened, and, by the end of the first franchise, advance plans were made to double the single-track section between Bicester North and Aynho, at a cost of £53 million. Marylebone station was then extended by adding a further two platforms, and there was an increase in line speed to Beaconsfield. In 2011, Chiltern took over the operating services on the Oxford-Bicester line from First Great Western and opened two new stations, Oxford Parkway and Bicester Village, providing services between north Oxford and Marylebone.
How confident is the Minister that all that would have happened if the line had remained with British Rail, which, 20 years earlier, was planning to close the station? Chiltern could do this because it had a 20-year franchise, which created the incentives for significant investment in rolling stock, major infrastructure and, as a result, timetable enhancements. It delivered its project on time and on budget, and self-financed nearly all the projects that I have just mentioned.
When pressed on why they were doing this, the Minister relied on, “It is in the manifesto”. Well, I hope they can provide a better argument than simply saying that. To use the expression used by the noble Lord, Lord Snape, Chiltern is to be sent prematurely to the “knacker’s yard”. Our debate takes place against a background of a Budget in a few days’ time, with enormous pressure on public expenditure. What the Government are planning to do—we will reach this in a later group of amendments—is bring on to their balance sheet all the private sector investment that has previously been borne by the private sector. Freight was mentioned, and the fact that they want to leave freight and open access operations in private hands perhaps indicates some inconsistency in their view that the private sector cannot deliver good services.
I will briefly mention two other reasons for these amendments. There is a question of the capacity of members of the Minister’s own department to manage all the new franchises that are going to come in. At the moment, they run four rail franchises; they have just two full-time staff and they rely on private consultants to manage these four franchises on a day-to-day basis. They are planning to absorb the remaining 10 franchises, which are now in private hands. They will have to grow significantly their own capacity to manage those departments and, as I understand it, they are in the process of growing their headcount from 21 to 90 by the end of the calendar year; all this at a time when there is pressure on departments to reduce their headcount. All these new people, all the external consultants, will need time to get up to speed with their new roles and build the necessary relationships to be effective, and I think that is a major constraint on their plans.
There is one other reason, which may be a simply technical one. It is possible that the Government may wish to extend an incumbent operator’s franchise, for example due to the lack of internal capacity that I have just referred to; but it may also be that the operator may not be willing to agree to a contract extension. As I understand it, with the Bill as currently written, the Government would not be allowed to appoint an alternative operator on a temporary basis—again representing a significant risk.
So these amendments indicate the need for flexibility, to allow the Government to retain high-performing private sector operators and to continue to give passengers an excellent service while minimising costs for taxpayers. I hope that, when the Minister replies, he will not say, “This is in the manifesto”, but will give some cogent reasons for ending the arrangement that provides, in the cases of Chiltern and Greater Anglia, the two lines that we have heard about, a high-quality service, possibly higher than the public sector would be able to provide.
Lord Berkeley (Lab)
My Lords, I will follow on from the interesting contributions from the noble Lords, Lord Lansley and Lord Young. I understood that Ministers had accepted that open access operators will be able to continue, or new ones may be able to come. So I have two questions. As the noble Baroness, Lady Scott, said in her introduction to her amendment, Greater Anglia is contributing quite a lot of money each year to the Treasury. Presumably it could ask to convert that service into an open access service and keep the money, and that would presumably be all right and the Treasury would lose out. I would be interested to hear my noble friend’s view on that.
If there is a new service, as one of the noble Lords said, that an operator of some description thought would be a useful one to introduce but which the new GBR thought was not appropriate, presumably there would be no reason why the new operator could not submit an application for open access, as happens at the moment. It does not have to be a long distance one from London to Blackpool; it could be a short distance one. How would that be seen by the Government. Would they welcome it?
Baroness Randerson (LD)
My Lords, this has been a very interesting group of amendments to debate so far, and I am very taken by the latest thoughts from the noble Lord, Lord Berkeley, on playing around with the definition of open access operators and what will be accepted. I was interested, too, in Amendments 28 and 29 and the thoughts of the noble Lord, Lord Young, who is always very thought-provoking. His amendment, as he said, is very much the obverse of the ones put down from these Benches. I urge the Government to look at this and allow themselves the flexibility to change the order of nationalisation in order to allow good franchises to flourish and to give themselves time to unravel privatisation more slowly and more logically. It has to be more than just, “This was in the manifesto and therefore it will happen whether or not it is logical”.
I am really sorry that the noble Lord, Lord Liddle, is not in his place, because Amendment 35 is fascinating. It refers to a broader definition of what a public sector company should be, so that it includes public/private partnerships and co-operative ventures. I do not need to remind noble Lords opposite that some of them have been, or may still be, members of the Co-operative Party. As Liberal Democrats, we share an enthusiasm for co-operatives as a form of company and operation. I can envisage that a smaller rail line, perhaps in a rural area, would work very well on a co-operative or a public/private partnership basis. After all, it would bring in fresh investment without, in any way, undermining the Government’s commitment to a nationalised structure overall for the railways.
Finally, I urge the Government to look again at their plans and the precise terms of the Bill through a post-Covid lens. Covid caused the collapse of the railway system, necessitating a whole new approach to franchising for the train operators. It could happen again, either for similar reasons or as a result of a financial crisis, and I urge the Government to look again at the terms of the Bill. Have they allowed themselves sufficient flexibility to cope with the unexpected, to allow rail services to continue to operate even if there is a series of unlikely events that have upset the market for those services?
Lord Moylan (Con)
My Lords, my noble friend Lord Young of Cookham said that he thought that the Government’s determination to trammel itself in the way that Clause 2 does was ideologically driven—a commitment to a certain vision of the railways based essentially on a political ideology. I would not be so bold as to disagree—he may well be right—but there is another way of looking at this, which I referred to at Second Reading. What is really driving the Government’s approach to this is that they have absolutely convinced themselves that the only way in which the railways can operate is if there is a single controlling brain, so that every train run in this country for passenger service purposes is run by Great British Railways, and that this body will be the sole provider of railway services.
This is a truly ideological obsession. It is almost a psychological fixation that appears to have gripped the Government, and it needs to be tested. Questions are being asked from every side of the House about its practical effects, and we are getting no answer except, “It’s in the manifesto”, which really is no answer to a passenger standing on a platform waiting for a train that was operating perfectly satisfactorily under private ownership and is now simply not arriving.
I turn first to Amendments 4, 10, 14 and 15 in this group standing in my name. If I had written the explanatory statements rather better, Members would understand—perhaps they do—that these four operate as one. They are consequential on each other and have a single effect, which is to say that the Secretary of State in awarding new services must put them out to tender but on a “concession” basis. Amendment 14 defines a “concession” as
“a contract under which the franchising authority specifies rail services to be provided by a private sector entity and retains the risk of fluctuations in the receipt of fares”.
In other words, this amendment does something that Transport for London has done with great success in relation to buses, London Overground rail services, the Wimbledon tram and the Docklands Light Railway. They are all operated on this basis and although there might be complaints from customers about this, that or the other, there are no complaints about the basis on which the services are operated contractually. Of course, TfL has chosen to brand them all under its own branding, so members of the public and passengers are often not even aware that they are operated on this basis. We have a system that works and that we should consider very seriously by contrast to the determination of the Government that all these services are to be taken in-house and run by a single employer with a great, single, controlling brain.
Amendment 14 does something else: it is in conformity with the Williams review, which I thought was the plan that there was, generally speaking, consensus that we should operate to. There is no other plan or document of any weight or substance that has been produced as a result of an independent review for the future of the railways. When I drew attention in our last debate to what is said on page 55 of the Williams review about the concession model being the pattern taken from TfL that should be used nationally, there was a slightly astonishing intervention from the Minister in which he said that Mr Williams no longer thought that, because he had rung him up and said that we need to have it nationalised. How much else in the Williams review has been vitiated by random phone calls made by the Minister to its author? How much is left of the Williams review, if it is capable of being rewritten by the Minister on the basis of claimed phone calls with Mr Williams?
It happens that Mr Williams and I served together on the board of Transport for London when the Minister was its commissioner. I have to tell him that if I were to look into the contacts in my telephone I think I would find that Mr Williams’s telephone number was in my telephone as well. It is perfectly possible that we could pursue this debate on the basis of various individual and private phone calls that we had had with Mr Williams about what he actually meant, what he thinks now, and whether his view has changed —and then what will be left of this report? Without this report, there is no plan. The Government are, it turns out, now inviting us to take a step completely into the dark. It is not just an act of faith, as I said on an earlier group, that they can run the trains better. It is a belief that they are going to give us a better plan for the future, but that they cannot tell us what the plan is, whereas at least previously they had some basis for saying what it would be. The whole thing really is turning into the most dreadful shambles.
I would like to know why concessions do not work, why something so successful in London will not be allowed, and why what was recommended by Williams is not allowed. I do not, I am sad to say, expect to hear the detailed explanation from the Minister that those questions deserve. The other amendments in this group have similar effect.
My noble friend Lord Lansley would like the Government to have the power, where they choose to, to go out to tender and allow some of these wicked private entities to submit tenders. I may myself be wicked when I say that many of these private entities are not very private—some are the subsidiaries of our great European railway friends. They are state-owned bodies from Europe. Who knows whether the Prime Minister, as he creeps towards a great reset and love-in with the European Union, would not find it quite useful to be able to say that the Italian railways, Deutsche Bahn and Renfe could bid for services running on our railways—just as they can at the moment—and that they are not going to be kicked out of Britain? “Mrs von der Leyen, we are going to let them back in.” Would not that little bit of flexibility that my noble friend Lord Lansley would like to be able to give to the Government possibly be rather welcome in the future?
My noble friend Lord Young of Cookham made a good case for his amendments. I echo the comments of the noble Baroness, Lady Randerson, who said that it is a great pity that the noble Lord, Lord Liddle, is not here to speak to his very intriguing amendment. To a large extent, the argument for it was made very well by my noble friend Lord Young of Cookham.
The possibilities of collaboration with the private sector—indeed, with community groups and, when we come to later amendments relating to devolution, local authorities and local government—are all worth exploring if we are going to reform our railway. All of these are being shut off and closed down now by the word “only”, which the noble Lord, Lord Lansley, and others are effectively suggesting be deleted.
Lord Hendy of Richmond Hill (Lab)
The next time I see our mutual friend Keith Williams I shall tell him that the noble Lord, Lord Moylan, said he was ghostly.
I thank noble Lords for explaining their amendments in this group, which consider, as we have heard, various alternatives to public ownership. Amendments 3 and 5, tabled by the noble Lord, Lord Lansley, would allow contracts to be awarded to private operators following a competitive process. Amendments 28 and 29, from the noble Lords, Lord Young of Cookham and Lord Moylan, would allow franchises to be continued where the current operator is providing a satisfactory service. I do not support these amendments.
The Government were elected on a manifesto commitment to return passenger services into public ownership—having published, for the avoidance of doubt, the detailed plan entitled Getting Britain Moving—and we have a clear democratic mandate to do so. Despite what has been heard this afternoon, public ownership is a change with clear public support. Last month, YouGov published a survey showing that 66% of people nationally agree that railway companies should be run in the public sector; only 12% favoured private operation.
We are determined to return to a passenger railway which is run for the public, by the public, with passengers, not private shareholders, at the heart of the system. We will not leave the back door open to franchising, a model which has failed passengers and taxpayers. We are committed to public ownership because continuing with franchising would mean continuing to pay fees to private operators, ultimately for the benefit of their shareholders, when that money could be retained for the public good. Franchising would not allow us to integrate track and train in the way we propose to do under Great British Railways, which is the only way to put a stop to the fragmentation and waste of the franchising system, otherwise we will not be able to sweep away the outdated, complex and costly mechanisms that make the fares system impossible to understand for passengers, and even now prevent rational change because of “commercial confidentiality”, even though all the revenue risk is now taken by government. There is no benefit to continuing franchised operations on our railways.
Contrary to views expressed by noble Lords previously, there is no meaningful private sector investment being funded by franchised operators at present, so we are losing nothing by moving to a public ownership model. The Government are already reimbursing the legitimate operating costs of private sector operators and receiving all their revenue. Even before Covid, the main private investment in our railways was in rolling stock, which was generally funded by the rolling stock market and not by train operators or their owning groups.
I turn to Amendments 4, 14 and 15, tabled by the noble Lord, Lord Moylan. These amendments require competitive awards to be made to private sector companies on the basis of a concession model, along the lines of Transport for London’s approach, rather than bringing them into public ownership. These amendments would remove the opportunity to deliver the benefits of public ownership, which, as I have said, a clear majority of the public support and which was a specific commitment in the manifesto on which this Government were elected.
The Government’s first objection is that a concession model would mean the private sector continuing to earn substantial profits. Public ownership will put a stop to the flow of money that already sees in excess of £100 million paid out in fees to the private sector each year, even when operators are bearing no significant financial risk.
A TfL-style concession model would expose operators to more financial risk than the current national rail contracts, which means that operators would want to earn significantly more in profits at the taxpayers’ expense and would price their bids accordingly. Not only would concessions be more expensive than this Government’s plans for public ownership but they would be even more costly to taxpayers than the current contracts.
In addition, the TfL concession model involves a very closely defined and largely unchangeable service specification developed in detail by the public authority, with therefore little room for the operator to negotiate changes post tender award in circumstances where they would always have the upper hand on pricing. Our national railway system is much larger, flows alter over time, and one of the great benefits of GBR is that it will be able far more easily to adapt to changing and growing markets and to save costs without endless contract renegotiation with contractors which, except at the point of contract award, always have the upper hand.
The noble Lord, Lord Moylan, referred to the TfL experience of contracting the London bus market. In two previous jobs I was responsible for that market for virtually 15 years. It is a different market because there are a large number of small contracts changing hands, so if a contractor is sufficiently unwise to suggest expensive changes when contracts need to be altered then there is the opportunity to at least counter that by the next award of contracts for other bus routes. That has not been the case in the railway market. It is never likely to be the case. It is a different circumstance.
As a practical point, this amendment would abolish the option for the Secretary of State to appoint a public sector company to run services once a franchise agreement comes to an end. What does the noble Lord envisage would happen under this amendment if an operator went bust at short notice, or lost its licence to operate or its safety certificate? What if a competition failed to deliver a satisfactory outcome? Passengers could not wait a couple of years while the Government run a competition for a new concession. I would also ask whether it is the noble Lord’s intention to tie the hands of the Scottish and Welsh Governments, as this amendment would do, and whether they support these amendments. I think he knows that they certainly would not.
Amendment 10, as the noble Lord, Lord Moylan, said, was to facilitate Amendments 4, 14 and 15, so I will pass over it.
Amendment 35, tabled by my noble friend Lord Liddle, would allow the Secretary of State, and Scottish and Welsh Ministers to award contracts to either a public/private partnership or a co-operative venture involving staff and passengers. The Government’s approach to this is driven by pragmatism, not ideology, and we are certainly not seeking to close the door on private investment, as I will explain later in Committee when we come to discuss rolling stock.
However, I point out that examples of private investment in our railway infrastructure have been fairly thin on the ground in the privatisation era. Nearly all the enhancements to the network have been publicly funded. The noble Lord, Lord Young, referred to electrification, but, as far as I can tell, there has been no electrification ever funded by any party except the Government.
The Government are certainly open to hearing proposals for how private investment might be brought to bear to improve the railway in the future. If noble Lords and others have good ideas, I encourage them to bring them forward as we develop and engage on our plans and consult in due course for Great British Railways and the wider railway reforms.
However, I do not think that involving private finance means that our plans for public ownership of train operations should change. It is fundamental to the Government’s plans for the railway that services should be run by the public, for the public. There are other ways of engaging private capital, short of ownership, and for the most part, even 100% private sector ownership of train operating companies under franchising has not resulted in large investments being funded by those companies.
As for co-operative ventures, I am all in favour of giving passengers and communities a stronger say in the decisions that affect them, but the likelihood of any co-operative venture raising any significant amount of capital—let alone the current circumstances of the owning groups of the present train operators—is, frankly, very small. Our plans are designed to give passengers and communities a stronger say in the decisions that affect them, not least by establishing a new passenger standards authority and by providing a new statutory role for devolved and mayoral combined authorities. We will get to the question of devolution in due course. The Government have shown, through our approach to resolving long-running disputes left to us to resolve by the previous Government, that we are committed to working with the workforce to address the challenges facing our railways.
The noble Lord, Lord Lansley, raised a question about future flexibility. The last legislation for the railways has lasted 31 years, and I note that it had a specific prohibition of public operation of the railways system. That might have been reasonable then but it is certainly reasonable now in the present circumstances, given our policies and manifesto commitment, to replicate our belief that public ownership is the right way of going forward with passenger railway operation.
In conclusion, the Government’s plans for the railways are founded on consolidating responsibility for track and train operations within a single entity, Great British Railways, particularly at a route and operating company level. Already, in my short period in this post, as I have said previously, we have had performance meetings with an operator and a Network Rail route. In one meeting, I enjoyed considerably one manager telling me how great collaboration was between the two parties, which were not owned by the same organisation, while the other simultaneously sat there shaking her head vigorously, demonstrating an absence of the very co-operation that I was being told would happen.
My whole professional history tells me that the railway will run better with somebody in charge of both track and train together at a route and operating company level. That is the way that we will deliver better revenue, decreased costs and, particularly, better reliability. This is not consistent with seeking to preserve private sector operation, whether through franchises or concessions, or with awarding contracts to public/private partnerships or arm’s-length co-operative ventures. I am amused to see that Rail Partners has reversed its previous opposition to the concession model post the election, having spent several years previously explaining why it would not work on the national railway network. I rather agree with its previous analysis. I therefore urge noble Lords to withdraw and not press their amendments.
Lord Lansley (Con)
My Lords, I am most grateful to all noble Lords who have participated in this not terrifically long but interesting debate—not least my noble friend Lord Young of Cookham, who admirably demonstrated the potential benefits of a mixed economy in the provision of rail services and referred to reasons why the Government might in the future need the flexibility that these amendments would offer.
I go back as far as the mid-1980s, when I was a civil servant participating in a spending round not dissimilar to the present one in a Star Chamber, where different nationalised industries had their capital programmes traded off against each other. I have to say that cost-benefit analysis was not a significant part of that discussion; it was mostly a discussion of the political benefits or otherwise. I fear the same will be true in the future and that some investment projects that should be funded will not be. It will be a great pity if that turns out to be the case for rail services in future.
I do not have the benefit of knowing Mr Keith Williams personally. I am tempted, as a former Leader of the House of Commons, to say that we instituted evidence sessions in committee. I wonder whether we could take an evidence session before a committee in this House as well; perhaps we will think about that for the future.
I thank the Minister for at least laying it all out pretty straightforwardly. He may come to regret saying that, essentially, as the 1993 Act was an ideological determination that there should not be public sector operators on the railways, we must now have legislation that says there must be only public sector operators on the railways. I am with the many of those who take another view—not least the noble Lord, Lord Berkeley, whose point on open access was about giving the private sector the opportunity under limited circumstances.
Lord Berkeley
“(1AA) Before making a direct award of a public service contract to a public sector company under subsection (1A), the relevant franchising authority must publish a report on—(a) the possible impact on rail network capacity used by rail freight services,(b) the possible impact on the meeting of the rail freight growth target for at least 75% growth in freight carried by rail by 2050 on 2019 levels.”
Lord Berkeley (Lab)
My Lords, in moving Amendment 6 in my name and that of the noble Lord, Lord Moylan, I will speak to two other amendments in this group, including Amendment 41, to which the noble Lord, Lord Bradshaw, has added his name. It is so good to see him in his place again as one of our real rail experts in this House, and I look forward to his remarks.
This amendment is about rail freight, largely. As noble Lords may know, I was chairman of the Rail Freight Group for some years. It is designed to put a requirement on the Government to report on the rail network capacity used by rail freight and to confirm a target of at least 75% growth in freight carried by rail by 2050 compared with 2019.
I am grateful to my noble friend the Minister for his quite long letter, which we received over the weekend, explaining different parts of this Bill. I welcome the letter; there are some good points in it and he answered my question, as he has not done so far today, about open access passenger services. The letter is there, so I do not need his answer again, and I am grateful to him.
However, what we have here is a Government who, as the Minister states in his letter, are clear on open access passenger services and want to encourage rail freight. The letter says that
“to enable the growth of rail freight … the Secretary of State will set an overall freight growth target to ensure that it remains a key priority”.
That is good. My question is how this will be achieved. Within the Great British Railways envelope, we have GBR itself, freight operators and the freight sectors. We also have the Office of Rail and Road, with “rail” apparently to be defined in the next Bill, and we have open access operators. All these groups will be vying to get capacity on lines or tracks that, as many noble Lords have said, are congested at the moment.
It is not just a question of how we get capacity on the track. I am told that, on the east coast main line, the current LNER service apparently wants to have five trains an hour running more-or-less non-stop from Edinburgh to London—I hope they find the passengers from somewhere. That is going to cause serious problems to the regional services which might want to cross that line at York or Doncaster or somewhere else. It puts into question the Government’s priorities: getting to Edinburgh every 10 minutes, or so, or getting across the main line from the Humber to Leeds, or similar places, on a service which may only run once an hour because there is no capacity.
The capacity divide between the long-distance passenger services and local services is something that we will need to explore in the future, but capacity also affects freight. One of the issues with freight which we have heard for many months, if not years, is that it needs a different speed of train because it cannot accelerate that quickly, and therefore needs electrification—which I am not going to go into. Something that has come up in your Lordships’ House so often is the improvement of the railway at Ely on the route between Felixstowe and Nuneaton or the north. Improvements there would enable many more freight trains to use that route, saving them from trundling along the North London line and places like that. Such improvements would also enable the capacity for freight; it just needs electrification.
Great British Railways will be in charge of the budget for railway investment and infrastructure, as well as the budget for keeping the passenger trains going. It will therefore effectively be in competition with the private sector operators and freight companies, and very careful work will be needed to ensure the allocation of capacity is fair and transparent. In my book, it is pretty unfair if one of the major operators, which will be GBR, in line with the infrastructure manager, which it will also own, will have control over how much capacity is available for freight—which is in the private sector—or open-access operators.
I am making this point because, while I think that producing a report after the first year—which my amendment would mandate—and looking for targets is a good start, we will need from the Minister, now or in the future, much firmer commitments on how much capacity will be needed on the main intercity or congested routes, and how the Government will allocate it. I look forward to further discussions with the Minister on this at some stage, but for the moment I beg to move.
Baroness Pidgeon (LD)
My Lords, I rise to speak to Amendment 40, which is focused on the issue of policing and safety on the railways. I welcome the Minister to his new role; I look forward to working with him, asking him many questions and debating the issues, as we have done elsewhere over the last 16 years.
As noble Lords have interrogated this legislation, safety has been a feature of our deliberations. However, safety is not just about the infrastructure and rolling stock; it is about the safety of passengers and staff on our railways. This amendment would require the Secretary of State to report to Parliament on the impact of this Act on the British Transport Police. The British Transport Police provides a policing service to Network Rail, rail and freight operators and their passengers and staff throughout England, Wales and Scotland. It is also responsible for policing other parts of our transport network including the London Underground, the Glasgow Subway, the Tyne and Wear Metro, the West Midlands Metro, the Docklands Light Railway, London trams and even the cable car in London.
What is different about the British Transport Police is that it is primarily funded by the railway industry, not the public purse, and it sits within the Department for Transport, not the Home Office. The train operating companies, Network Rail, other operators and Transport for London, through either police service agreements or different funding agreements, pay for the British Transport Police—its latest budget shows annual funding of around £416 million.
On these Benches, we are concerned about two specific areas. First, we are worried about the impact on policing the network, and the safety of staff and passengers as they use and work on our railways, as these changes to franchising take place. Secondly, we are deeply concerned about the potential significant funding gap, which had not previously been identified, as a result of taking public ownership of the railways. I hope the Minister will be able to provide assurance in this area and explain the Government’s thinking about the future funding of the British Transport Police.
Furthermore, there is the issue of the British Transport Police Authority itself and how it is structured. It consists of 15 members, often with railway expertise from the train operating companies, who ensure value for money for the policing service they provide across the network. It is not clear how this will be structured going forward to ensure the right level of challenge and independence from the Department for Transport, given the department will now be effectively running the railway in public ownership. I hope the Minister can reassure noble Lords that the funding and oversight of the British Transport Police has been considered as part of this legislation, and that he will respond to our specific points.
My noble friends will speak to our Amendments 41 and 6 regarding freight operators and the impact of this legislation on their operation.
Lord Bradshaw (LD)
My Lords, on the issue of freight, the intention should be that the freight service is given dedicated paths in the timetable. The timetable is the key to the whole issue. For freight to have a dedicated path, we need to use the paths that are available, or potentially available, to the best advantage.
To take the east coast main line as an example, it is possible to run quite a lot more trains along that line if the open-access operations are run by 10-coach trains which are divided en route. If the investment in the east coast main line is carried through, and if, for example, the Newark flat crossing is removed, I am sure we can get at least three, possibly four, more paths in every hour. The removal of the Newark flat crossing would greatly enhance the ability of freight to run inland from Immingham.
The Government have proposals before them to undertake very small pieces of electrification which would better connect freight services to the electrified network. They also have proposals, which the noble Lord, Lord Berkeley, has mentioned, to get the route between Felixstowe and Nuneaton working properly. That is an appalling railway—I have ridden across it on a locomotive—and it inflicts enormous delays on freight trains. If there is any money to spend, a good deal of virtue would come from spending on enhancing the freight network and creating more paths on the east coast main line, because they are scarce and very valuable.
Lord Young of Cookham (Con)
My Lords, I support the point made by the noble Lord, Lord Berkeley, about the potential conflict of interest under the new scenario: we will have Great British Railways, with a single operating mind, carrying all the revenue risk for passenger train operations, while at the same time there will be open-access operators and freight operators bidding for a limited path on the railways.
The former Secretary of State said:
“I shouldn’t need to approve whether a passenger train ought to be removed from the timetable to allow a freight train to run instead, as I was doing earlier today”.
The question is: who is going to make that decision in the future? If it is going to be GBR, as the noble Lord, Lord Berkeley, said, there is a clear conflict of interest; the company would have an interest in the passenger train operator having precedence in order to secure the revenue. That may be in conflict with government policy, which is to promote the transfer of freight from road to rail. Surely it is important that at the moment, the train operator cannot insist that he has a particular path for his train: he has to bid either to Network Rail or to the ORR. Who is going to make that decision in the future? Will it be a domestic one within GBR? In which case, how will the conflict of interest raised by the noble Lord, Lord Berkeley, be resolved in a way that is satisfactory for both the open-access operator and the freight train operator, which may find that they do not have the paths they wanted?
Baroness Randerson (LD)
My Lords, this small group of amendments addresses a number of issues that inevitably raise questions, because this very tightly drawn Bill provides no hint of how they are to be dealt with. I participate in this debate with some temerity following contributions by the noble Lord, Lord Berkeley, and my noble friend Lord Bradshaw, who know so much detail about the freight industry.
Liberal Democrat Amendments 40 and 41, to which I have added my name, are therefore probing amendments looking for details of government plans, which I hope the Minister can supply today. There are thousands of jobs and potentially billions of pounds of investment riding on the Government’s answers to these questions.
Amendment 40 is about a very specific issue but, as my noble friend Lady Pidgeon has emphasised, the role of the British Transport Police is vital, providing the rule of law on our trains. It is important to remember that the rule of law provides consumer and passenger confidence. Those of us who are older, younger or weaker are particularly dependent on the good offices of the BTP because they provide the assurance that people need before they are prepared to travel on our trains.
I emphasise that, as my noble friend said, British Transport Police funding has been provided virtually unseen from within the industry for a very long time. The total amount of money, at nearly £500 million a year, is not inconsiderable. It is therefore important that we have a clear answer now from the Government about they intend to deal with BTP in the future. In particular, how will it be overseen? Will that be with independence and at arm’s length from the Government? Which body will do that supervision?
Amendment 41, on freight, deals with a much more substantial and complex issue, because the freight industry is so complex. As the noble Lord, Lord Berkeley, said, it is essential that the new system be set up to encourage rail freight to improve its efficiency. That will be difficult, as he emphasised, because a centralised, nationalised Great British Railways will be bound to feel pressure to prioritise passenger services. We have crowded tracks running at capacity. We have vocal passengers who want trains at a time and a frequency convenient to them. We have a Government who have sponsored a nationalisation project, and their reputation will be damaged if passengers’ interests suffer. We also have a Government who emphasise that they are facing a financial black hole. Will they be willing to invest in track and signal modernisation of the sort outlined by my noble friend Lord Bradshaw, to benefit freight rather than passengers?
I fear that freight could rapidly become a poor relation, so I am keen to hear details and reassurance from the Minister. I thank him for his letter, but I point out that it says that next year’s railways Bill will “enable” the growth of freight. I emphasise that I would much prefer a duty to promote the growth of freight, rather than simply enabling it.
Lord Moylan (Con)
My Lords, I shall speak first to Amendment 40, concerning the British Transport Police, in the name of the noble Baroness, Lady Pidgeon. I associate myself with everything she has said about the importance of the British Transport Police in maintaining safety and law on the railway network and indeed in promoting a sense of safety, which is almost as important. That is particularly true, if I may say this, for women travelling on the railways, perhaps on their own. If they do not feel safe, they will not travel on the railways, it is as simple as that, and the British Transport Police have an important role to play in that regard. Fortunately, there is generally a good record of personal safety on the railways, but we want to see how the Bill will enhance that.
My figures may be terribly out of date, but when I was last involved, half the funding that the British Transport Police received came from Transport for London for services in London, and the rest was spread throughout the rest of the country. I will not say that the railway companies were not procuring enough British Transport Police to do the job—the test of that, of course, is whether there is criminality on the system—but they were not procuring at the same rate of coverage that Transport for London was procuring at. This is an opportunity for the Government to say, as they take control of the companies, how they are going to ramp that up and what investment they are going to make in it. I hope to hear from the Minister on that point.
A very interesting constitutional point was raised by the noble Baroness, Lady Pidgeon, which I had not heard expressed in any way before: how is the British Transport Police Authority to be constituted? At the moment it is constituted in large measure through representatives of the train operating companies. If there is effectively only one train operating company, which is the Government, how is it going to be constituted? As the noble Baroness says, it operates out of the Department for Transport. Is it going to become the first government department in this country—I think this is correct—to have its own police force? Even the Home Office, out of which ordinary policing operates, does not have its own police force; they are all accountable to police authorities or, now, to elected police and crime commissioners in appropriate areas, or to the Mayor of London in his capacity in London, and so forth. Could we end up in a constitutional nightmare here, a car crash that the Government have not properly thought through, as a result of this proposal to nationalise all these railways? Again, I would be interested to hear what the Minister has to say.
Turning to freight, I share the concern of the noble Baroness, Lady Randerson, about expressing too definite opinions on this topic, especially in the presence of the noble Lords, Lord Berkeley and Lord Bradshaw, who have such considerable and long-term prior knowledge of it. I have some slight sympathy with the Government on the point because, while I may be wrong about this, I understand that there are freight companies that have rights to paths which they do not use but will not relinquish because they may be useful in the future—and why should they relinquish them?—while, at the same time, they might want to have access to other paths which they cannot get hold of. This is slightly a mess, so perhaps there is some work for the Government to do here to sort it out.
The previous Government also had, as I understand it, a rail freight growth target: to increase rail freight by 75% by 2050. So far, that has not been mentioned and we have not heard yet whether the new Government wish to commit themselves to that target. Again, there is an opportunity for the Minister to say that that is his target when he gets to his feet. We would like to hear more about that.
The Minister may want to say that some of those points can be addressed in the future Bill—the Bill we are promised that is further down the road—but he cannot say that of the points raised by my noble friend Lord Young of Cookham and the noble Lord, Lord Berkeley, both of whom made the point that the way in which this is now proceeding, by contrast with the Williams report, creates a fundamental and ineradicable conflict of interest in the role of Great British Railways. When it was the body—the great controlling brain, as I referred to it—that was going to establish who could run what railway services where and, where appropriate, award franchises or concessions for passenger railway services, while also allowing open access and allowing freight services to take place, it could do that from a disinterested position. It would be allocating resource presumably according to some sort of rational principle that could be explained and interrogated by interested members of the public and other parties with a stake in the matter.
Now, of course, it is always going to be the case that Great British Railways will also be the operator of the passenger services—so what about the other services? What about open access and, most particularly as far as this group of amendments is concerned, where does freight get a look in? How does it make its case and to whom does it appeal if it feels it is unjustly done by? Is it to be allowed to appeal only to the courts or could there be a truly independent body outside Great British Railways—perhaps the Office of Rail and Road; I do not know—to which appeals could be made and which would decide and allocate these paths, where they are constrained, on a rational basis?
We have no idea about this because the Bill, as I said earlier, is being rushed through for manifesto and publicity reasons—for headline reasons, fundamentally—without these crucial questions that it throws up being answered. They are not my questions; I did not table these amendments. They come from Benches on all sides of the House. These questions are being thrown up and the Government have no answer, except the tune we are getting accustomed to, which has as its first verse, “It’s in the manifesto” and as its second verse, “We’ll tell you when we get to it some time next year”. I hope we can do better than that when the Minister gets to his feet.
Lord Hendy of Richmond Hill (Lab)
I will first say that I am delighted to see the noble Baroness, Lady Pidgeon, in her place. I hope that her questions will be easier than the ones she has asked me for the last 16 years.
I thank noble Lords for explaining their amendments in this group, which consider the impacts of public ownership on the freight sector and the British Transport Police. I shall speak first to Amendment 6, in the names of my noble friend Lord Berkeley and the noble Lord, Lord Moylan, and Amendment 41 in the names of the noble Baroness, Lady Randerson, and the noble Lords, Lord Bradshaw and Lord Moylan.
These amendments highlight the importance of the rail freight sector, which has a crucial role to play in supporting a productive economy and in helping to decarbonise transport on the way to net zero. The Bill in front of the House sets out with two very specific purposes: to enable franchised passenger services to be brought into public ownership as existing contracts expire, and then to enable the Government to keep them there in accordance with their manifesto commitment. As such, the Bill has no direct impact on freight operators or on the availability of network capacity to accommodate freight services. Indirectly, though, freight operators should benefit from public ownership of passenger services, for reasons I am happy to explain.
In the old franchising model before the pandemic, a franchise operator’s commercial motivation was to maximise its own profit—evidently, the difference between its revenues and its costs. If that meant running additional services, it would seek to do so through the usual industry processes of bidding for access rights and then for a timetable that included the extra services. It would not matter, and has not mattered, to the franchise operators that this might deprive freight operators of the opportunity to serve new markets in the future. There are various examples of franchise bidders seeking to win contracts on the back of proposed service enhancements that risked crowding out, or actually have crowded out, potential future freight growth.
Under public ownership, that unfortunate incentive will no longer exist. Publicly owned operators will instead be remitted to act in the interests of all users of the railway, including freight customers. We have made it clear that the forthcoming railways Bill will require Great British Railways to enable the growth of rail freight and that the Secretary of State will set an overall freight growth target to ensure that it remains a key priority. I am sure that we will debate these points further once the railways Bill is before your Lordships’ House.
The noble Lords, Lord Bradshaw and Lord Young, my noble friend Lord Berkeley and others asked how capacity will be allocated. I can certainly tell them how it is done now, because we have had an immense struggle to obtain a timetable on the east coast main line which seeks to justify the £4 billion-worth of public investment to speed up services and provide more passenger capacity. One reason we have had that struggle is that, although there is an appeal mechanism to the Office of Rail and Road, there is in fact no current decision-making process to allow a timetable to be completed, except by agreement. I believe and hope that it is currently in its last stages, but I am not certain.
One of the things that the Government have in mind is that Great British Railways ought to be the body that decides. The noble Lord, Lord Bradshaw, will recall what was the case on the old railway: somebody had to decide which services were of greatest priority and which ones had to be fitted round them. Under the current Bill, however, there is no change to the existing role of the ORR in access decisions for passenger and freight services. Under the future railways Bill—and we will consult on this—there will be appropriate safeguards for both freight and open access operators. We will set out details on that in due course, before any changes to the current approach are made. There is no need to require the publication of a report on this matter. Commissioning a report after this Bill, when in fact there will be no change at this point, will not add benefit to the debate.
I turn next to Amendment 40, in the names of the noble Baronesses, Lady Pidgeon and Lady Randerson, and the noble Lord, Lord Moylan.
Lord Liddle (Lab)
Before we move on to the British Transport Police and while we are still considering freight paths, the noble Lord, Lord Bradshaw, for whom I have enormous respect because of his experience on the railway, made the point that investment decisions are very important to getting more freight on to the railway. Is not the real question about freight the priority it is given in the investment decision-making process? I know the Bill is not about that, but, since there is concern about this in the Committee, can the Minister give us any guidance as to how investment will be prioritised?
Lord Hendy of Richmond Hill (Lab)
I thank my noble friend Lord Liddle for that intervention. All I can say at this point is that I would hope the rail network enhancement programme is published more frequently, and with more success in what it contains, than it has been for some years. We will have to wait and see what the fiscal situation allows.
Lord Liddle (Lab)
Would that be a decision for the Secretary of State or for Great British Railways?
Lord Hendy of Richmond Hill (Lab)
I think in due course we will have to come back in the substantive Bill with a proposition on how those decisions are made, who makes them, and for what period of time the plan is valid.
Lord Berkeley (Lab)
My Lords, I am grateful to my noble friend for his response to my amendment and other people’s. I have one or two questions that I hope will help the extended debate, because I do not believe we can leave the most important question of competition, which a number of noble Lords have mentioned.
Lord Teverson (LD)
Before the noble Lord sums up on his amendment, I think the Minister has yet to reply on the issue of the police.
Lord Hendy of Richmond Hill (Lab)
I apologise to the Committee; it is my novice inexperience. I thank the noble Lord for that intervention.
I turn to Amendment 40 in the names of the noble Baronesses, Lady Pidgeon and Lady Randerson, and the noble Lord, Lord Moylan. Amendment 40 would require the Secretary of State to report to Parliament on the impact of the Bill on the British Transport Police 12 months after its enactment. The BTP is governed by the Railways and Transport Safety Act 2003, which is not affected by this Bill. Under the 2003 Act, the British Transport Police Authority is responsible for the efficient and effective policing of the railways and for maintaining the British Transport Police force. The authority sets annual budgets for the BTP and recovers the costs of the BTP from the rail industry—of course, now, notably, this is all paid for by government—by entering into police service agreements. The authority sets the funding contributions for each railway service provider via a cost allocation model to ensure that contributions reflect the services provided by BTP and cover its costs.
Under the 2003 Act, the Secretary of State has made an order which requires railway service operators, as well as Network Rail, to enter into police services agreements. This obligation applies equally to public sector operators and private sector franchisees, and I can confirm that all four existing operators under DOHL have a police services agreement in place.
In conclusion, there is no reason to believe that public ownership under this Bill would have any adverse impacts on the freight industry or the BTP, so I hope my noble friend will be persuaded to withdraw his amendment.
Lord Berkeley (Lab)
My Lords, I apologise for intervening earlier and preventing my noble friend responding on the British Transport Police issue, which is most important. I would like to ask him whether it applies to Scotland.
About 10 years ago we had a debate here when the Scottish Government wished the Scottish police to take over British Transport Police activities in Scotland. My noble friend Lord Faulkner of Worcester and I tried to argue—I think the noble Lord, Lord Bradshaw, was there too—that this was a bad idea because policing the railways is fairly specialist work, as the noble Baroness, Lady Pidgeon, has told us. We ended up trying to divide the House at about midnight, which my Chief Whip at that time did not think was a particularly good idea because I had not told him about it. I pointed out that he was probably in bed asleep by then. Anyway, we did not win that time, but we did manage to achieve BTP having responsibility for railways in Scotland. It would be nice if my noble friend the Minister could explain how that will work under the new GBR system.
I will respond to my noble friend’s comments on the other issue, which is mainly about capacity and competition—whether it is freight, open-access operators or whatever. It was interesting that he said that the Government invested £4 billion in the east coast main line. That must have been in order to get an extra train per hour and a few other trains between Edinburgh and London. I am wondering who decided that it was a good thing to invest in the east coast main line to get more intercity services, rather than more freight or cross-country services. That it has not been delivered yet indicates that something else needs resolving, and we will have to see what that is.
The other issue is straight competition. I was not working on the railways before privatisation. I am assuming that Great British Railways in its 1990s shape had a number of divisions, as a noble Lord told us, including a freight division. That obviously worked very well at that stage, but when those in the freight division wanted another pass or two on a main line, I would hazard a guess that they had quite a job persuading the passenger people to move over a bit and give them space.
Great British Railways will be a monolith organisation. I am sure that underneath, it will have lots of subdivisions, which we will debate at some point. This will probably include the intercity services and regional services, and it will have to take into account open-access passenger and freight services. I cannot see how it will be able to demonstrate a fair allocation of paths when, as the noble Lord, Lord Young, mentioned, it will get all the extra revenue from an extra train if it is a GBR train, but no revenue apart from track access charges if it is an open-access train or a freight train.
This is a really serious and financially challenging discussion that we will need to have. I hope my noble friend will be able to respond in part to what I have said. I hope he will be prepared to meet me and anybody else who is interested in this competition issue before Report. I would like to see some wording in the Bill that would give open access passenger and freight some comfort that what goes in the next Bill will not send them over the edge. Could my noble friend respond to those points? I do not know whether he is prepared to.
Lord Hendy of Richmond Hill (Lab)
I will respond to my noble friend by either talking to him outside or writing to him.
Passenger Railway Services (Public Ownership) Bill
Monday 21st October 2024
(1 month ago)
Lords ChamberRead Full debate Passenger Railway Services (Public Ownership) Bill 2024-26 Read Hansard Text Watch Debate Read Debate Ministerial Extracts Amendment Paper: HL Bill 21-I(a) Amendments for Committee (Supplementary to the Marshalled List) - (18 Oct 2024)
Lord Moylan
“(1AA) Before making a direct award of a public service contract to a public sector company under subsection (1A), the relevant franchising authority must provide information to the Office of Rail and Road on the public sector company’s ability to become responsible for the provision of the relevant passenger railway services.(1AB) The information provided under subsection (1AA) must include an overview and analysis of the capacity of the public sector company to provide, maintain and improve the existing level of service. (1AC) Following the receipt of the information provided under subsection (1AA), the Office of Rail and Road must publish an opinion on whether it is reasonably practicable for the public sector company to provide, or secure the provision of, the relevant passenger railway services.”Member's explanatory statement
This amendment requires that the relevant franchising authority provides information to the ORR on a public sector company’s capability to provide adequate railway services.
Lord Moylan (Con)
My Lords, I will speak to Amendments 7 and 9, which together constitute this group. Both are concerned with what the Government say they intend to be the effect of the Bill: the improvement of passenger services. Again, they are largely probing amendments, although we would expect the Bill to be amended, if not with a purpose clause, as proposed earlier by my noble friend Lord Gascoigne, then at least with measures of the character contained in these two amendments, which seek to set a safety net, in effect, in different ways, for the services being provided.
Amendment 7 would have the effect that the relevant franchising authority must give to the Office of Rail and Road—it could be to some other trustworthy and credible body, such as the Department for Transport, if it is not the franchising authority—an assessment that the company that will take over the franchise is capable of doing so. People might ask: what company? The company that will take over the franchise as proposed by this Bill will be a shell company—an off-the-shelf company purchased by the Department for Transport; a perfectly ordinary company under companies law such as anyone might buy off the shelf. That already starts to raise questions around why we would think that it had any competence to run a railway. People will say, “Don’t be silly, that is just a form”. The form is an empty-shell company constituted under companies law, but the sole shareholder of that company will be the Department for Transport. In effect, the Department for Transport will be running this service through the shell company that it has bought off the shelf in order for it to be the recipient of the public service contract, which is the only type of contract that the Secretary of State will be able to award.
But the Minister said a little earlier in the debate— I cannot pin it down exactly without looking at Hansard, but I do not think that he will deny that he said it—that one of the main purposes of the Bill was to take out of the Department for Transport a whole load of stuff that it was no good at doing and give it to Great British Railways, because it would be better at doing it than the Department for Transport. Here we have a system proposed by the Bill in which the responsibility for operating a service will be taken from a train operating company with decades of experience of providing the service—perhaps, in some cases, hundreds of years of experience if it is a foreign railway company putting its foot into the British market and providing services to us—given to a company bought off the shelf, which is owned and controlled by a department that the Minister himself said should have functions taken away from it and transferred to Great British Railways. What sort of a mess is this?
That is why, very simply, this amendment asks for an assessment in advance as to whether that company —the operator—is fit for purpose. We are looking not simply at the shell company but at its shareholders and controllers—the people making the decisions. Why should not the public have that level of assurance before a franchise is terminated and transferred to such an entity? That is what the amendment is calling for, and there is a very strong case that it should be done.
The second amendment, Amendment 9, is not the same, but it points in a similar direction. Nothing is said in this Bill about what level of service the new operator will offer compared to the old operator. It is presumably for the Department for Transport or shadow Great British Railways—we do not know—to decide the terms and conditions of the public service contract that it will award. If it is the Department for Transport, it will award the contract to itself or to its shell company; if it is shadow Great British Railways, it will award it to the Department for Transport. Somebody will have to sit down and decide what those terms and conditions are. All we are asking in this amendment is that the services offered to the public should not be of a lower standard than they are under the existing franchise.
That is not to say that there is not the possibility of some sort of public consultation. That is what we have inserted. We have said that you can lower the services but that you have to consult publicly in advance. At the moment, that would be true on a transfer of a franchise. We have had no assurance from the Government that there will be a public consultation on the termination of a franchise and the award of a public service contract directly to one of the Department for Transport shell companies.
This is one of those issues about which the Government may want to say, ah ha, this will all be dealt with by the great big Bill coming down the rails towards us. That would be a grave mistake, because these issues relate specifically to this Bill and to what will happen the moment it starts to be implemented. As we discussed earlier, this Bill could be the governing statute of the operation of the railways for as much as four or five years, even if the Government have a good headwind behind their new measures and they come forward in time and are implemented reasonably. The public will want to know that our service levels are protected. Will they be consulted? Will the people who run these trains be fit for it, given that we know from the Minister that he does not think that they are fit for much else on the railways? I beg to move.
The Minister of State, Department for Transport (Lord Hendy of Richmond Hill) (Lab)
My Lords, I thank the noble Lord, Lord Moylan, for his amendments.
Amendment 7 considers the capability of public sector companies to take over services and operate them to an appropriate standard. It is clearly a key priority for the Government that services should transfer to public ownership smoothly, without detriment to the quality of service during the transition. For this reason, the transfer of services will take place using established arrangements and processes which have previously fulfilled the Secretary of State’s operator of last resort duties. I remind the noble Lord, Lord Moylan, that this has taken place under the previous Government and their predecessors four times with no obvious risk to the delivery of service.
DOHL is the publicly owned company that already oversees four existing publicly owned operators. It has had significant experience of managing the transition of services from private to public operation in recent years. These transfers have been completed successfully and smoothly despite challenging timescales and circumstances, which have included franchise financial failure and poor operator performance. DOHL is therefore well-placed to manage future transitions and is building its capacity to do so as we speak.
The Government have made it clear that we will transfer services on a phased basis as existing contracts expire. This measured, responsible approach will further de-risk the transfer process. As an additional safety net, the Bill includes provision at Clause 2 to allow for temporary continuation of an existing franchise where the Secretary of State is satisfied that it is not reasonably practicable to complete a transfer in the timescales originally planned. We do not plan to use this power other than in genuinely exceptional circumstances, but it is prudent that it should be available if necessary as a last resort, given that everybody would agree that disruption to passengers should be avoided.
Amendment 7 also seeks to provide a new role for the independent regulator, the Office of Rail and Road. The ORR is the regulatory authority responsible for granting operator licences and for assessing, approving and issuing operators’ safety certificates. This Bill does not change this. In its existing role, the ORR will assess carefully the suitability and readiness of any operator—public or private, passenger or freight—to take over services and to operate them safely, and is experienced in doing so. Considering DOHL’s previous experience and track record, the further safeguards I have described and the existing regulatory role of the ORR, the Government do not see any need to commission further analysis from the ORR as this amendment proposes.
Amendment 9 would require the Secretary of State, Scottish Ministers or Welsh Ministers to undertake a public consultation before specifying or allowing any reduction in service levels at all within a contract with a public sector operator.
I start by saying that the Government want to grow rail passenger demand and revenues; we are not starting out with an objective to cut services. When services transfer to public ownership, as now, we will expect operators to clearly communicate all changes to services. I agree that, if there were to be a plan for material reductions in service levels, this should be the subject of public consultation. However, I cannot support a statutory obligation to hold a public consultation in relation to every change to the timetable or to any other aspect of the service specification that somebody might consider to be to their disadvantage.
If a service is so poorly used that it is clearly unnecessary to carry on running it, and there is an alternative train available at a similar time of day, is it really sensible to expend time and public money on a consultation process? If there is a high-frequency service and a slight reduction at a quieter time of day would enable train and/or infrastructure maintenance to be carried out more efficiently and effectively, does this really merit a public consultation? If, God forbid, there were another global pandemic, or other immediate and extraordinary event that caused a serious reduction in passenger demand, I submit that it would be absurd to suppose that a public consultation would be necessary before reducing service levels.
There should of course be consultation on material reductions in services, but to require it regardless of the scale or impact of a proposed change would impose a disproportionate burden. I therefore urge the noble Lord not to press this amendment and to withdraw the amendment I spoke to first.
Lord Moylan (Con)
My Lords, will the Minister state at the Dispatch Box not that there should be a public consultation in the event of a material reduction of services on transfer of a contract but that there will be? If so, I would be very happy to leave the matter there. I would like to give him the opportunity to say that it is the Government’s policy that there will be a consultation if there is a material reduction in services on transfer.
Lord Hendy of Richmond Hill (Lab)
In response to the noble Lord, I do not see those circumstances arising. However, I will take the point away and consider it during the progress of the Bill.
Lord Moylan (Con)
I note that the Minister has not been able to give that commitment. With that, I beg leave to withdraw my amendment.
Lord Moylan
“(1AA) Every contract made in accordance with subsection (1A) must place a duty on the public sector company to publish a plan for investment for innovation across all aspects of its operations, including but not limited to—(a) operational efficiency;(b) fares and ticketing;(c) stations and onboard services;(d) passenger information; and(e) digital transformation.”Member’s explanatory statement
This amendment requires all public sector companies awarded a contract to publish a plan for investment in every operational aspect of the railways.
Lord Moylan (Con)
My Lords, I think we are getting to the point where every question has the same answer, which is essentially either, “It is in the manifesto”, or “We’re going to tell you about it in the future”, or “How dare you imagine for a moment that anything could go wrong on our watch?” I suspect that this is where I am going to end up with this amendment.
The amendment is very simply stated. It requires that, before there is a transfer to a public sector operator, an investment plan should be published so that we know what will happen on the railway. The proposition is so simple, so self-evident and so straightforward that it hardly requires argument, and it certainly does not require any great explication. With that, I beg to move.
Lord Teverson (LD)
My Lords, I did not speak at Second Reading, but I often speak on issues around public investment. One of the things that concerns me greatly about this move, although generally I might be in favour of it, is that, internationally, public investment in this country tends to be extremely low. In fact, over the last 25 years, the average public sector investment is 1.8% of GDP, which most of the time is well below our equivalent G7 nations. However, if you look on it year to year, the graph is a rollercoaster that Alton Towers would probably be favourable to, because it goes up and down, up and down.
I was privileged—it was a great company—to work in the public sector for a short period of time in the transport sector, not on the railways but in another area. Certainly, one of the concerns we heard very regularly from organisations equivalent to us within the public sector—I was in the freight sector, which was so small that the Treasury did not worry about it—was that investment in the public sector operating companies tended to vary year by year depending on what the Treasury felt was possible in terms of public investment, which completely disrupted a regular, predictable and sensible investment programme in what were effectively commercial public enterprises. I would like to hear from the Minister how there will be effectively that barrier between what the Treasury wants to do year to year and the genuine needs of public sector railway companies to offer a consistent and improving service to the travelling public.
Lord Hendy of Richmond Hill (Lab)
I thank the noble Lord, Lord Moylan, for his Amendment 8, which would require public sector operators to publish plans for investment and innovation. I would dispute the proposition that a move to public ownership will produce a decrease in investment. As I have previously said, currently no meaningful private sector investment is being funded by franchising.
Lord Moylan (Con)
I have not said that a move to public operation would reduce investment, nor have I argued it either here or anywhere else. The question put by the amendment is quite different to that.
Lord Hendy of Richmond Hill (Lab)
I thank the noble Lord for his intervention. I did not say that he had made the assertion; I was disputing the proposition that a move in that way would produce a decrease in investment.
As I said, no meaningful private sector investment is being funded by franchised operators at present, so we are losing nothing by moving to a public ownership model. The Government are already reimbursing the legitimate operating costs of private sector operators and receiving the revenue. Even before the Covid pandemic, the main private investment in our railways was in rolling stock, generally funded by the rolling stock market, not by train operators or their owning groups. Given that the rolling stock market is not impacted by the Bill, there is no reason to see that change.
The Government, of course, wish to see innovation and investment in areas such as those described in the amendment. In fact, the public sector is already demonstrating its commitment to innovation. We have committed to reviewing the overcomplicated fares system, with a view to simplifying it and introducing digital innovations. Change is already being delivered: for example, by the slightly delayed, extended pay-as-you-go in the south-east and fares reform on LNER. Public ownership is essential to progress these fares and ticketing innovations and other reforms. Unlike under franchising, with public ownership we will be able to get these sorts of reforms done without needing a commercial negotiation with up to 14 different operators, each seeking to boost their profit at the taxpayer’s expense in return for agreeing to implement those reforms.
However, the Government do not consider it appropriate to spell out detailed requirements such as these in the legislation. To do so would constrain future flexibility to adapt operators’ obligations to suit changing circumstances. It is not necessarily the case that constant investment and innovation across all these different aspects of the customer offer is the right approach. The focus of innovation should be on those areas where improvement is most needed at any point in time, and not those that are already working well. Moreover, it will not be coherent for passengers, nor efficient for the taxpayer, if up to 14 separate publicly owned operators in England, plus those in Scotland and Wales, are each pursuing their own separate innovation and investment strategies across all these different aspects of the passenger offer.
A key purpose of our wider reforms, starting with the establishment of shadow GBR, will be to drive a much more coherent, cross-industry approach in areas such as those described in the amendment. GBR will be the right body to consider investment across the railways, and I ask noble Lords to wait to consider the Government’s proposals on GBR in the coming months, though I feel very confident that a coherent guiding mind for the railways will produce a longer-term and more consistently argued approach for investment than has been true in the past.
In summary, I support the underlying sentiment that investment and innovation are needed to drive improvements in many aspects of the passenger offer, but the proposed amendment is not the right way to deliver it. I offer my reassurance that investment and innovation are critical to our plans to reform the railways, but I urge the noble Lord to withdraw his amendment.
Lord Teverson (LD)
I asked the Minister to tell me how we can isolate, to some degree, consistent investment decisions in the new railway structure from Treasury decisions that tend to move public investment up and down very regularly—I do not understand how that happens. We are moving from a situation where, if I have got this right, we have, effectively, investment being off-balance sheet through train operating companies and other organisations to on-balance sheet public expenditure. I am still desperate to understand how the new public sector train operating companies can properly rely on consistent investment. I would be interested to hear from the Minister what he expects the average level of investment in railways to be, per annum, over the next five years.
Lord Hendy of Richmond Hill (Lab)
A coherent guiding mind is far more likely to produce a long-term business plan for the railway that justifies future investment than the previous fragmented system. Very few of the owning groups or train operating companies have ever made any significant investment. The principal investment that has been made in passenger services is with the rolling stock companies, whose position is unaltered in the proposition of this Bill.
Lord Moylan (Con)
My Lords, I come away from each of the Minister’s responses slightly more baffled and frustrated than I was before. Let us try and get clear what I think he is saying. This in part is my attempt to frame at least a model answer to the question raised by the noble Lord, Lord Teverson.
At the moment, the Minister would say that there are in principle three sources of investment in the railway. There is what is put in by the private sector—that happens to be a nil set, the number is zero, but in principle it is there. There is what is provided by the private sector for the purpose of acquiring trains for the purpose of leasing them out—that is unaffected by the Bill, so that is not going to change, and nor is there any suggestion, incidentally, although I may be wrong about this, of course, we wait to see, that that is going to change as part of the Great British Railways Bill coming down the track. Then there is the part that is put in directly by the Government and that is currently negotiated by Network Rail in a series of five-year control periods. I forget where we are in the current control period, but we are vaguely half way through a five-year control period.
So, in the future, what is the Minister holding out to us that is going to be different? The contribution from the train operating companies will continue to be zero, because they are now going to be simply shell companies or part of that. He is quite clear we are not losing or gaining anything on that particular front. There will be no change to the way in which the roscos are set up for the purpose of leasing trains. So everything is thrown back on the comparison with the Network Rail negotiations in relation to the current control periods. Somehow, because that is Great British Railways, it is going to be transformed.
We have just heard that it will be longer term, so it will not be a five-year control period, it will be a 10-year control period or a 15-year control period. That might be very desirable—but why? Why is the Treasury going to agree to a 10 or 15-year control period or whatever the number is beyond the five years that exist? And if it is not going to be a larger sum—he did not say a larger sum—it will at least be a more efficiently deployed sum, so that every pound will buy a little bit more than it would have bought under the current arrangement? Again, the question is: why?
The sort of answer we get is, “It is all going to be absolutely wonderful. It will be different and it will be wonderful, but it’s going to be the same and I can’t explain why”. That is where we seem to be left the whole time. Anyway, with that, I beg leave to withdraw my amendment.
Lord Berkeley
“(1D) The relevant franchising authority must ensure that any public service contract awarded under subsection (1A) includes provisions to mandate rest day working.”
Lord Berkeley (Lab)
I rise to move Amendment 11 and to speak to the other two amendments in this group. This is very much a probing amendment to explore where the new railway structure is going to improve waste, delays and costs, which many people have attributed to strikes, go-slows and all the other things that they blame the trade unions for.
I have three examples. The first is to do with rest-day working, which I suffered the other weekend—three trains from Cornwall cancelled in a row. Other noble Lords present tonight have mentioned the cancellations due to rest-day working failures. I will quote from an email from First Great Western in reply to my complaint about sitting around for hours. It says:
“As you will be aware, while all new drivers who have joined the business in recent years have a Sunday commitment, the majority of high-speed drivers still do not. Without a change in terms and conditions we will remain reliant on volunteer overtime to cover Sundays”.
So it looks as though, in 20 years’ time, we will still have the same problem. I ask my noble friend the Minister what the Government intend to do to deal with this and to reach agreement with the trade unions. Of course they need time off—on the other hand, the passengers would like to have a train going at the weekend sometimes.
Lord Young of Cookham (Con)
My Lords, I will speak briefly to Amendment 18 in my name, which proposes the creation of an independent body responsible for pay and terms and conditions of employment for employees of the public companies that are going to be set up under the Bill.
In the long term, I assume that GBR will be responsible for settling these particular issues, but, in the meantime, the question is: who is going to do that? By default, I believe and assume it will be Ministers. That is going to be a real challenge for Ministers, because the department will inherit from the current train operators a whole range of different terms and conditions for their employees, some of them anachronistic. There will then be a difficult process of harmonising all these different terms and conditions into one composite terms and conditions for the new public sector employees that are going to be created. I would have thought that the Government should welcome an independent pay review body to help them through this potential minefield, with the trade unions, understandably, arguing for everybody to be levelled up, with all the implications that will have for current subsidies of the railways.
Also, I think that an independent pay review body which would, of course, receive representations from the Government as to what they thought was affordable, should look at some of the practices that have grown up over the years that might be due for reform: for example, the refusal of trade unions to fit track sensors to trains in order to identify faults in the tracks. That has been held up because there is no agreement.
Likewise, information about changes to speed limits is now put on a board, but it is proposed that it should be put on an iPad; again, there has been resistance to that. Then there is a hangover from the 1980s. As I understand it, an employee who uses a microwave is entitled to paid leave to have a health check.
An independent pay review body could look at some of these practices and see whether they might be modernised. If the alternative is that we should leave all this to Ministers, I am afraid that what happened in the summer does not leave me full of confidence. I am sure that the trade unions, if they had been really pressed, could have set out their new relationship with the new Labour Government by conceding something by way of reform before the near 15% pay settlement. An independent pay review body could look at issues of productivity and management to see if the costs could be managed more effectively.
I turn briefly to Amendment 19, picking up the discussion we had at the end of the last group of amendments about the impact of private investment disappearing, a point raised by the noble Lord, Lord Teverson. As I understand it, the Minister’s reply is basically this: the train operating companies have provided a minimum level of capital investment. I happen to challenge that. The examples I gave—Chiltern opening new railway stations, double-tracking, single-track lines—disprove it; nearly all the investment was self-financed by Chiltern.
Putting that on one side, the Minister’s argument is that the roscos—the rolling stock companies—will continue to buy the rolling stock and, therefore, there is no impact on the public purse. But he has left out a crucial element in the dialogue: the roscos then lease the rolling stock to the train operating companies by way of a franchise. At the moment, the fag end of those franchises, which the department has inherited, score as public expenditure, I believe. That is a liability of a public train operator to discharge the cost of a franchise.
When we move over to the new system, in which all the train operators are run by the Government, surely the franchise costs—the liabilities to pay the rolling stock companies—will score as public expenditure. That was left out of the Minister’s recent exchange. It was also glossed over in the letter that he kindly wrote to us over the weekend. Perhaps he can clarify what the view of the ONS will be on the franchise liabilities of GBR when it takes over the rolling stock from the train operating companies.
Lord Snape (Lab)
My Lords, I express some degree of surprise that my noble friend Lord Berkeley has tabled this amendment. If you make rest-day working in the railway industry mandatory, it ceases to be rest-day working, does it not? The whole purpose of rest-day working is to see that people take a break from their work. While my noble friend outlined the difficulties that have arisen in various parts of the railway system because people have declined to work their rest days, that is not really the fault of the people themselves or their much-maligned trade unions.
The fact is that, particularly since privatisation—although it happened under British Rail as well—railway staffing has been reduced as much as possible. The first thing that Stagecoach did when it took over South West Trains was to make lots of train drivers redundant. Not surprisingly, the ones who were left declined to work their rest days; they declined to work overtime. The number of cancellations in the first two years of Stagecoach’s operation of South West Trains rose accordingly.
I recommend to my noble friend a book called Red for Danger, written by a man called Tom Rolt—LTC Rolt—who sets out railway accidents since the 19th century, many of which were caused by tiredness because of the number of hours worked by drivers and signalmen. I will give one example. In 1892, the Thirsk accident, which killed some 35 people, was caused by a signalman falling asleep. He fell asleep because his infant daughter had been ill, and he had spent two days trying to find a doctor for her, but she had died. He tried to get time off after her death—he was on nights at the time—but the stationmaster refused permission. He had been awake for 46 hours. Two express trains crashed as a result.
Following that tragic accident, in 1906 the House of Commons at least debated the question of railway hours and the fact that many railway workers worked excessively. Perhaps noble Lords will not be surprised to learn that the debate did not spread to this end of the Corridor—obviously, noble Lords at that time had other things on their minds. Coming reasonably up to date, my noble friend Lord Berkeley will remember the Clapham Junction accident in 1988, where a considerable number of people were killed. That was caused by an error by a signal lineman who had worked every single day for the previous three weeks.
Arising from accidents like those, rest days were introduced by the railway industry around the time of the First World War. If train services cannot be maintained at a particular depot without rest-day working, then that depot is undermanned—it is as simple as that. Whether my noble friend the Minister can promise that such circumstances will not happen under Great British Railways is something I will leave with him.
I hope I have made it quite plain that I am not one of those people who thinks that everything about privatisation was wicked, but one of the downsides of privatisation was at least the tendency to run railway operations with a minimum number of people. I hope my noble friend Lord Berkeley will reflect on, understand and accept the fact that rest days are there for a particular purpose, and that he will withdraw his amendment.
Baroness Pidgeon (LD)
My Lords, as Liberal Democrats, we recognise that ultimately passengers do not really care who runs the railways. What they care about, as we have been discussing today, is that the trains run on time and at a fair price. We believe that the railways can offer that reliable, affordable, convenient and clean form of transport. It is very clear from today’s debate that the trains are not currently working properly. The system is a mess and people out there feel they are paying more and more money for an increasingly poor service.
While we support the Government’s desire to reform and improve passenger rail services, we do not think that renationalising passenger railway services will automatically deliver cheaper fares or a better passenger experience. As we have heard in the discussion on this group of amendments this evening, there is a fear that this reorganisation will create uncertainty for the workforce—the noble Lord, Lord Berkeley, has already outlined some serious issues.
We want to ensure that the entirety of the rail industry is focused on improving its performance, bringing down the rates of cancelled trains and improving the experience for the passenger. To achieve this, we need staff who are motivated and feel valued for the role they are playing in people’s lives. It is not clear how staff will feel going through lots of change and TUPE processes, and what this will mean for the services to passengers. I hope the Minister can assure us that there is a workforce plan, and that thought has gone into this important area.
Research by the National Skills Academy for Rail shows that 35% of the UK’s current 17,000 train drivers will leave the sector within the next five years as a result of retirement and the sector’s ageing workforce profile. Given that it takes at least 12 months to train a driver, from recruitment to driving in the roster, how are the Government going to attract new entrants into the railways at a time of change and potentially huge uncertainty? How can we be assured that passengers will not face cancelled trains as a result of fewer drivers in the rail workforce? That was an issue passengers experienced only a few years ago when Govia Thameslink Railway took over the Thameslink, Southern and Great Northern franchise and did not have enough drivers who could fulfil the timetable—we need to make sure that passengers are not going to be affected by this.
As mentioned in the earlier discussion by my noble friend Lady Randerson and the noble Lord, Lord Young, terms and conditions differ so significantly that it will take a long time to regularise them, and at huge cost. That will have an impact on not only the workforce but passengers. We do not want good people to leave the industry at all levels—train crews and staff, maintenance and management. On the contrary, we want good people to stay and be proud of the part they are playing in keeping Britain moving and in being a part of our new railway service. I look forward to reassurance from the Minister on these points to ensure that the workforce and passengers are at the heart of these proposals.
Lord Moylan (Con)
In speaking to these amendments, I say first that I thought the speech just made by the noble Baroness, Lady Pidgeon, was extremely sensible and contained a great deal with which I agree. It asked a series of important questions of the Minister. I have been around just long enough to have realised that getting actual answers to questions in Committee in your Lordships’ House is a pretty remote prospect, but these questions are of such importance that the Minister might make a bit more than the normal effort to address them.
I draw attention to Amendment 49 in my name, which raises the question of minimum service levels, which the last Parliament enacted as means of ensuring continuity of some service on the railways if strike action were to take place. The Government have not said whether they intend to avail themselves of that legislation and in what circumstances, but nor have they said they are going to repeal it. Many passengers in the country at large, looking to this as a means of protecting them from the ravages of what is sometimes thought to be excessive and persistent industrial action, would expect the Government to have a clear view on when they are going to use these measures—or even if the answer to that is “never”. I hope we can get a straight answer from the Minister on that.
I turn to Amendment 18 in the name of my noble friend Lord Young of Cookham, which relates to an independent pay review body. That amendment or something similar was discussed in the other place when the Bill was before that House, and the Minister in fact gave some encouragement, saying that the Government would at least look at it as part of the great reform Bill coming down the tracks towards us. I would like to hear whether government thinking has developed in any way since then and if there is anything the Minister can add to it.
On the face of it, the amendment deals primarily with agreeing and setting, in a semi-binding way, the pay rates and terms and conditions for railway staff analogously to those in other parts of the public sector. After all, it is the Government’s policy that these people should now be public employees. They should come under a single employer, a single brain and a single wallet, so it would be an independent pay review body along those lines. However, my noble friend Lord Young of Cookham took the amendment in another direction as well and made an interesting point, one also made by the noble Baroness, Lady Pidgeon: how are the Government going to amalgamate, smooth out or harmonise the varying terms and conditions and rates of pay that exist among the different train operating companies as currently constituted, as they bring them under this great big umbrella? Is there going to be a levelling up all round?
Will there be a cost to the public purse? The Government have claimed that the Bill involves no cost to the public purse, but it is patent that, if you employ a large number of people and end up adjusting their pay scales on the grounds of equity, and if those pay scales tend on average to be higher than before, a cost has been incurred directly as a result of the Bill and the action being taken under it. How is that cost to be dealt with? Where is it to come from? Why are the Government not being honest about the Bill involving costs of that character? This is a point we will return to, I am sure, when we come to look at other liabilities being transferred to the Government as a result of proposals in the Bill, as we will do later in this Committee. I invite the Government to think about this seriously, because these are important issues and they should be looked carefully.
Finally, and taking account to some extent of the lateness of the hour, when we started debating this group it was my intention to rise to offer some level of support to the amendment tabled by the noble Lord, Lord Berkeley, relating to minimum rest days. But the comprehensive and unremitting demolition of his position advanced by the noble Lord, Lord Snape, was so persuasive and irresistible that I have decided to abandon that effort.
Lord Snape (Lab)
I am grateful to the noble Lord for his kind words. I would just refer him to the proposed new clause to be inserted by the amendment in the name of his noble friend Lord Young, which is headed “Independent body to advise on pay and terms and conditions of employment for employees of public sector companies”. I make it that, during this debate, the party opposite has proposed no fewer than seven different bodies, groups, organisations or committees—call them what you like. As the Opposition rails regularly against too much bureaucracy, I am astonished that they want to create yet another body. In the event of a pay dispute, does the noble Lord not agree that that is why, many years ago, we created the conciliation and arbitration service? Such matters are better referred to it—we are surely running out of lawyers to sit on all these bodies—rather than creating yet another bureaucratic organisation.
Lord Moylan (Con)
In response, I say only that seven would be a fantastically tiny number compared to the number of internal boards, committees, liaison bodies and so forth that Great British Railways is likely to require to explain to itself what it is doing, before it even gets round to explaining to the public what it is up to. I regard seven as a very modest and economical number.
Lord Hendy of Richmond Hill (Lab)
I thank my noble friend Lord Berkeley for his Amendment 11, regarding rest-day working. Rest-day working provides resilience in response to spikes in leave, sickness and training, and it rewards the workforce when extra hours and days are worked. It can offer benefits to rail employees, as well as to passengers. It is likely that it will always be necessary, to some extent, to effectively deliver the timetable. However, rest-day working should be used where there is an operational benefit and employees are willing to volunteer, rather than trying to mandate in legislation how and where it is used. Our focus is instead on ensuring, as soon as possible, that the railway industry has enough staff to operate services reliably for the benefit of passengers and employees, without excessive rest-day working.
My noble friend Lord Berkeley referenced the new trains on South Western Railway. I say to him that they are now entering service and, further, that Network Rail in fact substantially changed terms and conditions two years ago for greater flexibility and in agreement with the workforce, and that is now reflected in greater efficiency. That deal demonstrates what can be achieved in the public sector.
The noble Baroness, Lady Pidgeon, referred to uncertainty. There can be no greater uncertainty than has existed for the last 30 years on the railway, in which anybody of long service has changed their employer at least once, sometimes several times, while doing the same job. The people whom I meet going around the railway talk about it as “the railway”, many of them because their employer has changed so often that they cannot even remember the name of the company that they used to work for. Some stability in respect of the employers of staff on the railway, many of whom are deeply committed and have had long service, is overdue, and this Bill will move towards it.
Will there be a workforce plan? Yes. Is there one at the moment? No. As the train operating companies come into public ownership, they will have to have a workforce plan. Personally, I am absolutely committed to the maximum recruitment of drivers as early as possible, to the benefit of the drivers themselves and the service that the railway operates.
I also very much thank the noble Lord, Lord Young of Cookham, for Amendment 18, which suggests that an independent body should be established to advise the Government on the pay and terms and conditions for railway staff under public ownership. We are committed to delivering the biggest overhaul of our railways in a generation. It is right that, as part of that process, these matters are considered. Employment conditions are an important issue and one that we are determined to get right.
My officials are at the early stages of exploring a number of options, including a pay review body, so that we can consider the most appropriate approach to meet the needs of a transformed industry. A number of different approaches exist across the public sector, including pay review bodies and wider guidance, and, as my noble friend Lord Snape said, the use of the Advisory, Conciliation and Arbitration Service. We need more time to reach an informed conclusion on the best approach for the rail sector. It would be inappropriate to commit to the introduction of an independent body before that work is completed. In particular, we do not need to do this now in relation to this Bill.
Amendment 49 is in the name of the noble Lord, Lord Moylan. It seeks to require the Secretary of State to produce a report on how public ownership will impact the implementation of the Strikes (Minimum Service Levels) Act 2023. The noble Lord must surely be aware, however, that the Government have already committed to repealing the Strikes (Minimum Service Levels) Act 2023. That is because this Government are committed to strengthening the rights of working people by empowering workers to organise collectively through trade unions.
No relevant employer, under the Strikes (Minimum Service Levels: Passenger Railway Services) Regulations, has chosen to implement minimum service levels under this legislation and, in fact, they will not work. Instead, we will work in partnership with trade unions, as we have done in recent weeks to bring an end to two years of disputes that have meant needless disruption and misery for passengers. So I must say to the noble Lord that the Strikes (Minimum Service Levels) Act will not be implemented for publicly owned services, or indeed at all under this Government—as, in fact, it was not under the last one. The suggested report, therefore, would be redundant.
Finally, I will respond to the points made by the noble Lord, Lord Young, on the classification of the costs of rolling stock for publicly owned train operating companies when I respond to Amendment 19 in group 10 in the resumed Committee stage on Wednesday. I note for now that, whatever the position is, it must already apply to the four publicly owned train companies. I urge the noble Lord to withdraw his amendment.
Baroness Randerson (LD)
Before the noble Lord sits down, can I ask a question in reference to the fact that the Minister mentioned that there was no need to sort out terms and conditions now? What timeframe do the Government assume that they must follow in order to ensure that the first train operating companies to be taken into public ownership do so in an organised way so that new staff are recruited with modern terms and conditions of employment.
Lord Hendy of Richmond Hill (Lab)
I thank the noble Baroness, Lady Randerson, for her intervention. In fact, I did not say that there was no need to sort out the terms and conditions now; I said there was no need to sort out the particular matter of how the overall pay and conditions might be dealt with, including with the pay review body. As a matter of fact, the employees would transfer under the transfer of undertakings regulations. At that stage, no change is possible on the transfer. That will need to be resolved and I am sure that changes are in fact needed, if only because, at least in my view, some of the existing train operating companies have failed to develop the terms and conditions in the way that they should have, both to operate a better service and to reward the staff more effectively.
Lord Berkeley (Lab)
My Lords, I am very grateful to all noble Lords who took part in this short debate. My amendment was a probing one, as I said, and I have no regrets about tabling it because we have learned a great deal this evening. It has been easier to blame what has gone wrong in the railways and the strikes in the last few years on the trade unions or even the present Government, but most of the passenger franchises that have been operated in the last 10 or 20 years have had Department for Transport puppet-string holders behind them, telling them what they can and cannot do, which is not the way to negotiate. Most successful negotiations take place on the background of a client, customer or owner who knows what they are doing and has done it before, and trade unions that also know what they are doing.
I am pleased that my noble friend has given us a progress report on where this is likely to go and I thank him for the information and for updating me on some things, but I hope that it will not be too long before we see an even better arrangement for the workforce, whether it is a workforce plan or whatever, including Network Rail workers. Then everybody could get their heads down and get on with providing a good service to the customers—which is, of course, what everybody wants. On that basis, I beg leave to withdraw the amendment.
Passenger Railway Services (Public Ownership) Bill
Wednesday 23rd October 2024
(4 weeks, 1 day ago)
Lords ChamberRead Full debate Passenger Railway Services (Public Ownership) Bill 2024-26 Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: HL Bill 21-II Second marshalled list for Committee - (22 Oct 2024)
Lord Moylan
“(1D) The relevant franchising authority must consult the Council of the Nations and Regions before making a direct award of a public sector contract to a public sector company for a rail service that serves destinations in two or more of England, Scotland and Wales.”Member's explanatory statement
This amendment requires the relevant franchising authority to consult the Council of the Nations and Regions before making a direct award of a public sector contract to a public sector company for a rail service that serves destinations in two or more of England, Scotland and Wales.
Lord Moylan (Con)
My Lords, we come now to one of the most important debates in our consideration of this Bill in Committee: a group of amendments on devolution and the powers of local authorities, devolved authorities and combined mayoral authorities in relation to the vision of passenger railway services. At this stage in the debate, I intend to speak only to the amendments in my name—Amendments 12, 13 and 50—although I will offer general support to the others in this group, many of which I have added my name to. I may have more particular comments about them later in the debate when their movers have had a chance to speak to them.
I shall dispose briefly of Amendments 12 and 13, which were intended to be helpful. Indeed, Amendment 12 is still intended to be helpful. It would require the relevant franchising authority to consult the newly established Council of the Nations and Regions, which the Prime Minister has set up, before awarding contracts to a public sector company. We on this side of the House thought that it might be useful for the new council to have something practical to do; I would have thought that considering the provision of railway services is something that would take up a considerable amount of its time and generate a great deal of interesting debate. I shall say no more about this amendment because I imagine that it will be happily accepted by the Minister.
Lord Snape (Lab)
My Lords, I find myself in a somewhat embarrassing position, so far as this amendment is concerned, in that I agree with a lot of what the noble Lord opposite has said. In fact, had he put his name to Amendment 43—which I will speak to—my embarrassment would have been doubled, because he raises a very relevant point, as far as devolution is concerned, about railway services.
I anticipate—my noble friend will tell me if I am wrong —that Great British Railways will assume responsibility for most of the railway stations in England and Wales in future. Actually, I suspect it is only in England because of devolution in Wales. However, when we look at the present situation, most of them—as I have indicated—are owned by Network Rail, but many are run and owned by train operating companies.
Avanti has come under some criticism in your Lordships’ House over the years, not least from me. Avanti runs and is responsible for stations—not small country stations, but fairly large ones such as Birmingham International, a station that I have used frequently over the years. It is a major station with about a dozen different destinations, as far as trains through that station are concerned, yet it is virtually unstaffed after 10 pm. There is a train dispatcher on the platform, as I understand it, but there are no staff at all either in the booking office or on the concourse. I put it to my noble friend: if the major legislation he refers to goes through next year, what will be the position for stations such as Birmingham International? Will Great British Railways assume responsibility for staffing? If so, we can only hope for an improvement in railway staffing.
Baroness Pidgeon (LD)
My Lords, I am delighted to speak to Amendment 16, on devolution of the railway, an issue dear to the hearts of the Liberal Democrat Benches. It is clearly an issue of concern to noble Lords on all sides, given the large number of similar amendments before us today and the debate we are having.
In my maiden speech at Second Reading, I said that there is no one model internationally—public, private or both—that is the perfect way to fund and run a railway, but I did refer to the huge success of devolved rail in London, be it the Overground or the Elizabeth line, and of Merseyrail. One of the greatest concerns I have about the Bill is that we are debating it without seeing the more substantial plan legislation and that we are, in effect, closing off options. I do not want to see devolution taken off the table as a result of this legislation, but that is what it will do. There is no room here for further devolution.
Devolution is not simply a duty to consult in order to allow locally and regionally elected members to make a few comments on the service they would like for their residents: box ticked, job done. It is about being able to run services in a way that serves the needs of local areas and communities and integrates them with other public transport, such as buses and trams. It is about empowering our devolved institutions to have some ownership and a genuine stake in delivering quality transport services locally. It is about that local accountability. That is what is so disappointing about this legislation. Instead of enabling greater local service delivery and accountability, it takes everything back to the department—a “Whitehall knows best” approach.
As a new Member of this House, I was concerned that I was missing something. Surely this Bill would not prevent further devolution supporting local and regional authorities, yet it does. The letter sent to Members by the Minister states that
“this single-purpose Bill does not affect the existing arrangements which allow Transport for London and Merseytravel to procure passenger rail services in their area. It will remain for these bodies to decide how best to deliver those services. Nor does this Bill change the existing role of other local authorities”.
The trouble is that the existing role, the status quo, is not good enough, and that is why this amendment has been tabled.
We want genuine consultation as each franchise comes up, to allow proactively for devolved bodies to come forward and say which lines they would like to run locally, and to support this. Further lines were planned to be devolved in London, such as the Great Northern line out of Moorgate, but with a change in Secretary of State, they were blocked. There are many metro rail services that run in London, such as those by South Western Railway or Southern Railway, that could easily be run by TfL and be part of that comprehensive transport offering in London, properly co-ordinated and branded as one coherent service.
In London, devolution has enabled that joined-up thinking not only on wider transport strategies but on housing and economic regeneration, alongside an additional level of accountability and increased responsiveness. In the first four years of the Overground alone, there was an 80% jump in ridership to 190 million passengers; fare evasion fell from 13% to 2%; the number of delayed trains fell by 11%; and the frequency of service increased on some lines. As we know only too well, the London Overground and the Elizabeth line are always at the top end of performance, according to the Office of Rail and Road.
Let us look outside London. Fellow noble Lords have mentioned Manchester today. Greater Manchester is set to play a key role in delivering the Government’s ambitions for economic growth. In recent years, the city region has had the highest rate of productivity growth in any part of the UK. Despite this success, there is potential to deliver more. Having a modern, fit-for-purpose rail network, integrated with other transport modes, is crucial to delivering economic growth, prosperity and opportunities.
By integrating and embedding rail into Manchester’s Bee Network, the Greater Manchester public transport system will be transformed, delivering a step change for the region. Transport for Greater Manchester and the Greater Manchester Combined Authority want to integrate eight core rail lines into the Bee Network by 2028. This is just the start of their plans: enhancing the current customer rail offer, the greater modal integration, accessibility and enhancements in performance. While this will significantly improve Greater Manchester’s transport offer, their longer-term plans for full local rail integration will require significant change. This legislation will remove full devolution of metro lines as an option. This cannot be the Government’s intention.
It is our belief that all devolved institutions should have a statutory role in specifying and directing rail outcomes and outputs, both services and infrastructure, including being able to run local services as they wish. This needs to be set out clearly in the legislation, and ensuring this strength locally and in our regions will counteract the risk of a centrally controlled service, isolated in Whitehall, not responsive or reactive to local need. We really want the Government to think again on this point. I hope the Minister can assure us in his response today.
Baroness Jones of Moulsecoomb (GP)
These are my first amendments in this new Parliament. It is a real pleasure to be speaking on transport, which is something I have always enjoyed. I am absolutely thrilled because this is the first time ever in 11 years that the opposition spokesman has signed an amendment of mine. I have four amendments signed, and I am just over the moon about that. I am so pleased that now the Conservatives are in opposition, they see the good sense in what I am saying.
The Green Party has long supported the public ownership of rail, along with other natural monopolies such as the NHS and water. We therefore support the Bill.
I have been told to say that the purpose of my amendments is to probe the Government’s plans on devolving control of the railways, but I do not really want to probe. I would just like the Minister to tell me whether or not he is going to accept my amendments. If he possibly could, I would be so pleased. It would be a highlight of my already very exciting day.
Greens are very keen on subsidiarity: making sure that ownership and power are devolved to the lowest possible and most practical level. This point seems especially important given the emerging devolution agenda. Can the Minister tell me whether rail will be involved in the devolution plans or remain the property of the UK Government, as the Bill currently sets out? My light-touch amendments would at least keep the door open to councils and combined authorities working together to run or oversee the railways within their areas.
There is hope for a public transport revolution under this Government, but the only way we will get people out of their cars and on to public transport is if it is integrated and easy for them to get from where they are to where they want to go—and then back again, perhaps much later at night.
Can the Minister please reassure me that the publicly owned rail companies will work in tandem with transport authorities all over the system to make sure that bus timetables are integrated into train timetables? How is the system being designed to ensure co-operation between different parts of the network; for example, so that buses and trains can run on linked timetables? In a conversation we had some time ago, the Minister said to me that the train line I use on a weekly basis, South Western Railway, is the worst in Britain. Could he expand on that, please? I would be interested to know how it is going to be improved.
As a Green, I would be thrilled to work with the Government on this exciting public transport agenda, and my honourable friend Siân Berry MP raised these points in the other place. I look forward to this particular Minister taking an incredibly practical view of the whole thing and making sure that he is not corralled by the Labour Government into doing things that he knows are wrong.
Lord Young of Cookham (Con)
My Lords, I shall speak to Amendment 34 in my name, which would allow franchises to be led by local authorities. It goes a little further than one of the amendments proposed by my noble friend Lord Moylan, who wanted partnership boards, and is more in line with what the noble Lord, Lord Snape, wants to do with his Amendment 43.
We need to be clear about what new Section 30C does. Basically, it says that the only people who can run a railway in future are a public sector company owned by a Secretary of State. Unless the Minister is going to repeal that in the forthcoming Bill, it means that for ever and a day, as we have heard, we are going to have a central monopoly for all franchised rails.
My noble friend went to the Labour Party document on transport to inspire his speech. I looked at the document published in March this year, Power and Partnership: Labour’s Plan to Power Up Britain, which pledged to devolve new powers over transport, employment support and energy out of Whitehall. That was followed up by the manifesto promising “landmark devolution legislation” to transfer power out of Westminster and into communities across the UK. So we could have expected the first pieces of legislation in the new Parliament to fulfil that ambition of devolving power out of Westminster, particularly in the field of transport, where there has been significant devolution of powers in rail, as we heard in earlier speeches. Like my noble friend, I was surprised to read in the letter from the Minister—and I got a slightly different wording—that:
“The Government has no current plan to devolve responsibility for further services to local authorities”.
As we have heard, Transport for London has taken over services that used to be run by British Rail, and then by South Western Railway and the other TOCs, and it now runs the Overground. I think that has worked well, and it has enabled TfL to integrate the Overground with the Underground and provide a better service to Londoners.
Outside London, many local authorities have successfully introduced light rail lines. There are 11 light rail systems in the UK. Manchester Metrolink is probably the best known, with 99 stops and 64 miles of track, run by Transport for Greater Manchester. We have also heard about the smaller West Midlands Metro, run by Transport for West Midlands. So local authorities are perfectly capable of building, maintaining and running serious rail systems.
The Minister’s statement seems to preclude the sort of arrangement that works well in London from happening anywhere else. All that local authorities are promised in the letter is a statutory role governing, managing, planning and developing the rail network, but not taking it over and integrating it with the system that they already have.
I think the Minister is in some trouble on this issue. We have had a powerful speech from his noble friend Lord Snape, and there is a feeling in the Committee as a whole that the commitment to devolution is simply inconsistent with new Section 30C as it stands. I do not think this is the landmark legislation that we were promised, so I hope the Minister thinks again about the implications of new Section 30C.
Lord Lansley (Con)
My Lords, I have Amendment 36 in this group, which has exactly the same purpose as the amendments from my noble friend on the Front Bench and my noble friend Lord Young of Cookham, who has just spoken. All their points and those made by the noble Baroness, Lady Pidgeon, demonstrate the potential value and benefit of having the legislative opportunity for publicly owned companies responsible to devolved authorities to be able to run rail services. If we do not have this, it can be only a public sector company owned by the Secretary of State. I was going to instance examples, but I think we have had so many that it is very clear.
The only difference between my amendment and others is the kind of authority appropriate to own a company which runs rail services. I fixed on mayoral combined authorities simply because of the relative capacity and their importance in the Government’s devolution agenda, and because it might commend that thought to the Government.
From my own experience, not least from being a Member of Parliament in a mayoral combined authority, I think it is increasingly important for the Government to recognise—which clearly they have put at the front of their argument—that the co-ordination of the railways is of the first importance, including ticketing, timetabling, provision of services and so on. In many of these places, as was amply demonstrated by earlier speeches, the co-ordination of transport services and of transport with planning and spatial development is equally important. If the Government go down the path of central control by the Secretary of State for every aspect of rail services, I am afraid that they will severely impede, in many significant areas of the country, transport and spatial development being conducted in the way that we would prefer it to be.
Lord Berkeley (Lab)
My Lords, I support my noble friend Lord Snape’s Amendment 43 and will speak to many of the other amendments in this group. I support most of the statements that have been made from all parts of the Committee in this debate.
We have been talking about devolution for years. It started off as levelling up—and we can debate whether it was levelling up or levelling down—with the last Government. But the Labour Party has been very keen on what I would call devolution for a long time and has supported the mayors of Manchester, Leeds and the West Midlands in trying to get control of their transport services, as the noble Lord just said. It is equally important to be able to decide what services are provided and who pays for them.
One of the key things which we have been debating for some time is these so-called regional authorities being given a lump sum, if one likes, and told that they can spend it on transport and then be allowed to get on with it—let them decide, on the basis of local elections and local politics, what they want to provide. Everybody’s objective would probably be to see in the north and the Midlands a general quality of service compatible with and just as good as that provided in the south-east, around London. It is not all provided by TfL—although much of it is—and I think most noble Lords would say that it is very good. I do not understand why the Government do not go the whole hog and say that they will give these regions a lump sum, to be negotiated, and let them get on with it.
The noble Baroness, Lady Pidgeon, asked whether Manchester could deliver. The answer is that it cannot deliver if Whitehall is in control. We have quite a serious problem here and I do not know what the answer is, except to say that I am convinced that some of the clauses we are debating tonight are counterproductive to what I thought the Government were trying to achieve.
What is the point of taking certain rail franchises into the public sector and turning them into something else if, next year, a Bill will give them a new franchise or concession? The noble Lord, Lord Moylan, has not mentioned the word “concession” yet today, but I expect he will. Concessions are very good in some places, but the key is this: what is the point in making this massive change now and then coming back in a year or two to say that we will let the West Midlands run all local services—it can put them out to tender, and have the money to provide the service with the frequency and fares that it wants—and ditto in the north west and north-east?
We really need to know the final outcome planned by the Government before we can know whether the Bill will be helpful or not. If we make a change now and then another change in two years, the people who will be damaged are the passengers on the railway.
Lord Gascoigne (Con)
My Lords, I support my noble friend Lord Moylan on Amendments 12 and 13 and I echo some of the great speeches in this group. As my noble friend said, it is right to ensure that, through some mechanism, the nations and regions are consulted, and, crucially, engaged, to ensure that they are brought into the decision-making process so that the service which eventually emerges is as effective as possible.
I am sure some will hark, yet again, that we are calling for more consultation and bureaucracy, but let us be clear: we on this side have always believed in devolution and power to the people. As my noble friend Lord Moylan said, the Government themselves have committed to the concept of devolution when it comes to transport. Therefore, is it not right that we utilise the opportunity to bring the Council of the Nations and Regions into discussions to ensure that we have the best services possible where there is overlap between the nations? Everyone is citing different quotes, but the PM said when the council was created that “we work as one team” and a “partnership”. If it is the view that that is too onerous, as I am sure the Minister will say, then we could at least try to engage the much- trailed but lesser-spotted envoy to the regions.
I support the noble Lord, Lord Snape, as I always do, in his Amendment 43. It calls for the Secretary of State to produce a report on whether a service could be devolved when it awards it to a public operator or renews a private franchise. That is wise and right, and I assume the case for doing so would be to assess the pros and cons for commuters, which we on this side of the Committee believe should be the focus of the reforms.
Supporting this amendment takes me back to what was said on day one of Committee on my amendments, when it was deemed that:
“Amendment A1, to which the noble Lord, Lord Gascoigne, spoke earlier, would create another bureaucracy”.
Later, this noble Lord hoped that the Minister would
“not get too bogged down in the bureaucratic desires of the party opposite”.—[Official Report, 21/10/24; cols. 433, 435.]
Who was so opposed to putting in a mere purpose clause, lest it be too bureaucratic? Lo and behold it was the one and only noble Lord, Lord Snape, who is now calling for an amendment to include a report when a rail service is awarded to a new operator. I welcome this Damascene conversion from the Labour Benches; I say yes to the noble Lord’s amendment but yes to Amendments A1 and 48A.
Lord Snape (Lab)
Before the noble Lord ruins entirely my career, such as it is, with his praise, I must tell him that he is comparing lemons with oranges. More accurately, what I said last time had nothing to with the devolution of railway passenger services to our great conurbations. I am rather against bureaucracy; it is the party opposite, as far as this legislation is concerned, that seems to be obsessed with it.
Lord Gascoigne (Con)
I do not know what the protocol is but I find it novel, if I may say so, that the noble Lord opposes bureaucracy when this side proposes it and yet supports it when it is convenient to himself.
Lord Ranger of Northwood (Con)
My Lords, I too welcome the Minister and the whole debate on the Bill, including notably those Members who have had a previous role in London’s transport. There is obviously the Minister but also the noble Baroness, Lady Pidgeon, and—
Lord Ranger of Northwood (Con)
Yes, there was the noble Baroness, Lady Jones, my noble friend Lord Moylan and myself, in the role of adviser to the Mayor of London on transport. Although we have spoken much about how London’s model has improved and can be looked at, I have to highlight that I support my noble friend Lord Moylan’s amendments, and particularly Amendment 34 in the name of my noble friend Lord Young with regard to the Secretary of State’s power to award—and potentially their power only to do so.
I recall that in the almost four years that I was the mayoral adviser for London, between 2008 and 2011, there were at least five and a half Secretaries of State for Transport. Sometimes the rotation of Secretaries of State through that important office can be quite hasty. If we are looking to award such authority, power and control to that office, the speed in the potential change of roles can lead to a certain amount of confusion and hesitation, and not even the progress that we would want to see. For that reason, as many others have probably mentioned, I support Amendment 34.
I also support my noble friend Lord Lansley’s Amendment 36 on planning. This was a point that I wanted to make. One of the major changes that we made when we came into City Hall in 2008 was to look at developing the London Plan and the Mayor’s transport strategy in conjunction, so that we could understand the potential for investment in transport infrastructure and where we would look for housing and the development that would generate jobs and growth. That is obviously critical to where investment in transport is then made, and there can be an issue if we do not align that strategy with planning; therefore, we have the amendment that my noble friend Lord Lansley mentioned.
There are a number of challenges when we start to centralise thinking about transport planning. It worked better when we worked very closely at a city and regional level, and closely with boroughs as well. Local authorities know very well their requirements and demands. That feeds into the overall stitching together of planning for what transport is required. During my career, I was fortunate to work in organisations such as Transport for London, Network Rail, the Rail Safety and Standards Board and even the Department for Transport. That approach, though it felt fragmented, brought together the complex requirements for transport. Yet whenever the Government—not the previous Government but the one before them—tried to centralise through organisations such as Railtrack, the Strategic Rail Authority and Network Rail, as it seems they will do now with Great British Railways, there seemed to be a disconnect between what was required and what the large, centralised bureaucracy was trying to deliver. On that basis, I also support the amendments tabled by my noble friend Lord Moylan around ensuring that there is enough authority and devolution in the Bill.
Baroness Randerson (LD)
My Lords, I support the intention of the amendments in this group. There is one amendment in the name of my noble friend Lady Pidgeon, Amendment 16, which the noble Lord, Lord Moylan, has signed, as I have signed his Amendment 12. Unlike him, I want to talk about devolution in Wales and Scotland, because that issue is very important. Railways cross borders; that point is addressed by the noble Lord’s amendment. I agree with his idea that there should be proper formal consultation with the devolved Governments—by the way, I can assure him that the new Council of the Nations and Regions should have a crowded agenda, because many devolved issues have been building up over a long period.
Let us look at the case of Wales. If, for example, you travel from Cardiff to Wrexham, you find yourself crossing between Wales and England; your start and end points are in Wales, but the middle of the journey is in England. That complexity needs to be built in. Devolution of rail powers to Scotland is pretty clear, but in Wales it is—I hope—a work in progress. I will explain to noble Lords why I say, “I hope”. The Welsh Government do not have powers over rail infrastructure. The operation of the railway in Wales is the responsibility of the Welsh Government, but infrastructure planning and funding remain with Network Rail. This is a cause of considerable frustration; the Minister answered a question about it earlier today.
This frustration is largely because Wales gets under 2% of total infrastructure spend in the UK, while having 5% of the population and more than 5% of the land mass. Our rail systems in Wales are in such a poor state, so there is a good argument that we should be getting more than 5%. The failure to allow Wales the Barnett consequentials of HS2 just rubs salt into the wound, and it is a lot of salt—£4 billion of it. I urge the Government to rethink the situation and the tendency set out in the Minister’s letter, because surely there is no hard and fast rule on this. Back in 2007, the Labour Government of the UK made noises which suggested they were willing to offer Wales control of infrastructure. Unfortunately, at that point, the Welsh Government were not keen to take it on, but I think they would be very keen now.
I am keen that this Bill does not in any way prevent further devolution. Transport for Wales, which is owned by the Welsh Government, is investing widely. Despite problems in mid-Wales, services are improving, and passenger numbers were up 27% in the last three months alone. That is a sign of progress. Can the Minister explain why the Welsh Government might not be considered capable of doing the rest of the job?
As my noble friend Lady Pidgeon has said, Transport for Greater Manchester, which I recently met representatives of as well, is enthusiastic about its success and devolution plans. They spoke to me about the Bee Network, which has lower costs than what went before, higher levels of punctuality and higher numbers of passengers. It is a real success story. They have firm plans to devolve eight rail lines within the next four years. I gather that they may be looking at some form of public/private partnership. That is the sort of thing referred to in the amendment tabled by the noble Lord, Lord Liddle, in Monday’s debate.
Can the Minister specifically reassure us that the aims of the declaration of intent that Greater Manchester signed with the previous Government still hold good? Can he specifically reassure us that there is nothing in this Bill that will prevent Greater Manchester’s ambitions being implemented? We on these Benches want to go further. Where Greater Manchester leads, why should not Birmingham, Liverpool or several other places follow? Shutting off the devolution of rail is at odds with the Government’s plans to give local authorities more powers over buses, for instance. It does not sit comfortably together.
I have two pleas for the Government. First, as I said on Monday, I ask them please to leave their options open. Do not close off avenues in the Bill: allow for unexpected events in the future. Secondly, it is illogical to allow open access operators to pick off rail routes, and it is illogical to encourage local authorities to have more control over buses but not to encourage them to fully integrate their local transport services by having control over trains and railways as well.
The Minister of State, Department for Transport (Lord Hendy of Richmond Hill) (Lab)
My Lords, I remind noble Lords that the Bill is, in my view at least, narrowly focused on allowing the further public operation of existing franchised railway operations currently in the private sector. Many in this House will know that I was the commissioner of Transport for London when the original Overground was proposed and established. Some of the details of its success are extremely familiar to me and give me a glow of pride and satisfaction whenever anybody mentions them. I was also there when the Overground was expanded—in fact, some Members of this House could have allowed it to expand further but chose to oppose it on the grounds that, for a mayor of a different political colour, that might not suit the then-Government’s aims. I say all that because devolution is really important. I have no intention of closing it off, and neither does the Bill—but it has to be subject to the effective operation of the railway network as a whole. I will come back to that in a moment.
I will speak first to Amendments 31 to 33 and 37 of the noble Baroness, Lady Jones of Moulsecoomb, Amendment 34 of the noble Lords, Lord Young of Cookham and Lord Moylan, and Amendment 36 of the noble Lord, Lord Lansley. These amendments would empower the Secretary of State and the Scottish and Welsh Ministers to award contracts to companies owned by various local authorities. Amendment 16 of the noble Baronesses, Lady Pidgeon and Lady Randerson, and the noble Lord, Lord Moylan, aims to provide opportunities for local authorities to take responsibility for services in their areas before contracts are awarded to public sector operators.
Amendment 46 of the noble Lord, Lord Moylan, would require another report, this time on whether public ownership makes it more or less likely that further services will be devolved by means of exemptions granted under Section 24 of the Railways Act 1993.
Amendment 50, also of the noble Lord, Lord Moylan, is another attempt to delay transfers to public ownership, as it makes the establishment of new regional partnership boards the trigger for the provisions of the Bill to come into force. The noble Lord, Lord Moylan, mentioned shadow Great British Railways. This is not a statutory entity but a preparation for Great British Railways; it is not a mechanism to do its job in advance of the creation of the body itself.
In line with the spirit of all these amendments, the Government are absolutely committed to strengthening the role for local communities in shaping the design and delivery of passenger rail services in their areas. Our plans for reform will make this a great deal easier for them, because they will need to engage with only one organisation—Great British Railways—instead of having to deal separately with Network Rail and multiple train operating companies.
The noble Lord, Lord Moylan, reminded us of the manifesto. We have already made it clear that our railways Bill will include a statutory role for the devolved Governments and mayoral combined authorities in governing, managing, planning and developing the rail network, and there is absolutely no intention to enact rail reform without that statutory role. We are committed to a full and open discussion on that role, and how it will work, as we refine our plans for the railways Bill in the coming weeks, and that will be included in the published consultation.
Lord Berkeley (Lab)
I would be grateful if the Minister answered a couple of questions arising from the statement he has made, for which I am very grateful. He said that passengers do not want to be confused by different types of services and operators, but from talking to people who have been involved in TfL and Merseyrail, I get the impression that they think they are rather good. I am not sure they would agree that they would be better if they were run from London by some centralised organisation telling the people of Liverpool or Manchester how many trains they can run.
It all comes back to who actually gets the revenue from the train fares and who pays for the trains, which will probably affect what the local mayors can ask for. They might want to see more trains, but if they are going to have to ask central government for an extra train, that will get quite difficult. I do not think the Minister has answered the question of the money that will be saved through this amendment and the new structure. We have not seen how much money it is going to save or how much extra revenue it might generate. I look forward to his comments.
Lord Hendy of Richmond Hill (Lab)
I thank my noble friend for his intervention. I do not disagree with him at all: those railway services are rather good. I did say that I was rather proud of the Overground, and from a distance I still am; it is a rather good service. However, there is a difference. Those services operate very largely within the Mayor of London’s geographical area, and the fares at the extremes do not differ. In Liverpool, I believe, they are wholly within the Liverpool City Region, but if not, the same applies. Consideration has to be given to consistency when the services stretch beyond those boundaries. That has been, and is capable of being, managed well.
The points my noble friend makes about who pays for enhancements—both the revenue costs of enhancements, and of extra trains if they are needed—and who gets the revenue from that are all subjects on which we are in harmonious discussion with the Mayor of Greater Manchester and Transport for Greater Manchester. It is possible to enhance railway passenger services in conurbations and elsewhere without having ownership of them, in circumstances where the proliferation of ownership may well create other costs. In the previous debate in Committee, I referred to the number of train crew depots in Newcastle. My recollection is that there are currently four, all of which have managers, supervisors and clerical staff. That is not the sort of proliferation of basic on-costs that we want to see in the rest of the system.
We are having a very practical discussion in Manchester about the eight lines that the mayor wants to specify. I suspect that, at the end of the day, when we reach an agreement, as I believe we will, the services the mayor wants will be presented as part of the Bee Network. I expect them to look consistent across Manchester, in the different modes that Transport for Greater Manchester controls. That is exactly the same effect as we had with London Overground and Merseyrail. We will have to bridge those gaps without creating further cost and confusing passengers.
Amendment 43, in the name of my noble friends Lords Snape, Liddle and Berkeley, requires the Secretary of State to produce an assessment of whether passenger services could be run by devolved authorities before any contract is awarded to a public sector company or any private sector franchise is extended temporarily by the Secretary of State. As I have said already, it is not our intention to devolve the operation of further services to local government as part of this process. Our intention is to end the failing franchise system and move to a public ownership model, which will then allow us more easily to reduce fragmentation and create a culture focused on delivering for passengers and taxpayers, not private shareholders.
It is deeply important that local leaders have greater influence over what services are run in their areas. That is why we are engaging with them to develop a statutory role for mayoral combined authorities in the rail network, which will become part of the wider Bill. As I have said, further devolution of services risks including fragmentation, but as I have also said, it is not ruled out by the Bill.
I turn to Amendments 12 and 13 from the noble Lord, Lord Moylan, which require the Government to consult with the Council of the Nations and Regions and the Prime Minister’s newly appointed envoy before transferring cross-border services to the public sector. This amendment is not necessary. The Government regularly engage devolved Governments on cross-border services. Both the Scottish and Welsh Governments are in favour of transferring rail services into the public sector, and we have worked collaboratively with Scottish and Welsh Ministers on the proposals in the Bill. Consultation will continue to take place as further services are transferred into public sector operation.
In addition, the Council of the Nations and Regions has been set up by the Prime Minister to foster positive collaboration with the devolved Governments. Clearly, we do not require a legislative amendment to encourage collaboration when the council exists to do just that, and I am sure that the newly appointed envoy will further facilitate that.
The noble Baroness, Lady Jones, referred to South Western Railway and in particular to the line between Salisbury and Exeter. I am confident that it will get better when South Western Railway comes into public ownership and we can get much closer liaison between infrastructure and operations and their management.
The noble Baroness, Lady Randerson, referred to Welsh ownership of infrastructure. I am not sure that she is right, bearing in mind our experience with the valley lines, in saying that they aspire to own the infra- structure, but the Bill would not prevent that.
Finally, the noble Lord, Lord Moylan, might want to note that Keith Williams, who he mentioned and who I mentioned on Monday, publicly endorsed the rail manifesto published by the Labour Party before the election. I will say no more about that.
With thanks to all noble Lords for this debate, I urge them not to press their amendments to this relatively narrow Bill, but I will reflect further on everything I have heard about devolution today.
Lord Moylan (Con)
My Lords, I start with a brief apology to the noble Lord, Lord Snape, for not having signed his amendment and assure him that if he wishes to approach me in the corridors between now and Report, some sort of grubby deal can probably be done between us in that regard. My signature is readily available for the many wise things that he has said in this debate.
Lord Snape (Lab)
If we are going to meet to discuss these future amendments, grubby deals or otherwise, better in one of the bars where the noble Lord can put his hand in his pocket.
Lord Moylan (Con)
There is the basis of a grubby deal, I suppose, but I am sure it will be done on an equal, Dutch, shared basis.
The Minister has heard what the Committee has had to say from every corner, and he will know that his response will have left noble Lords on all sides bitterly disappointed. He has promised to combined mayoral authorities, to local authorities and to regional authorities every conceivable aspect of devolution except the right and the possibility to run their own trains, which has been done so successfully in London and, I understand although I have no personal experience of it, on Merseyside. That is now suspended; it is off the table, for a number of years at the very least, on no rational grounds at all. As the noble Lord, Lord Berkeley, so rightly said, we need to know the final outcome now.
For all the Minister’s talk of this being a narrow and technical Bill, its effect, in combination with his letter, is to put an end to the further devolution of rail services to local and regional authorities for the foreseeable future, and that is something the Committee is clearly not willing to accept. There is a fundamental difficulty at the heart of this Bill, and that is the commitment made so fulsomely to devolution, endorsed or otherwise by Mr Williams, whose views seem to be plastic and developing and to respond differently to every telephone call he gets from the noble Lord—it is possibly getting to the point of rent-a-quote from Mr Williams. Despite all the commitments made by Mr Williams and by the Labour Party in its pre-manifesto document on rail services, there is not going to be any meaningful devolution. Those commitments are not consistent with the Government’s other commitment to the single controlling brain. It is a contradiction at the heart of the legislation.
As for the ability of local authorities to commission services, as the noble Lord, Lord Berkeley, so rightly said, it is all a question of money. We promise it for buses, but as we said when we discussed the Statement made on buses—on that occasion too the noble Lord, Lord Snape, was very helpful in supporting what I said —it is all very well telling local authorities they can commission new bus services, but they do not have a bean to do so. It is all very well telling regional authorities they can commission more rail services, but unless we understand, as the noble Lord, Lord Berkeley, said, who is going to pay for it and who is going to get the fares revenue, it is all pretty meaningless.
It seems to me that the great single brain is already suffering a serious headache and that the paracetamol of devolution may be what it needs to dilute the effects and to take the pressure off that brain. I think this is a point on which the Government are going to have to give some ground, and I certainly think it is one we will debate again when we return to the Bill on Report. With that, I beg leave to withdraw my amendment.
Lord Hamilton of Epsom
“(1D) The relevant franchising authority must make an assessment of the steps any public sector company is taking to prepare for driverless trains before making a direct award of a public sector contract to that public sector company under subsection (1A).”
Lord Hamilton of Epsom (Con)
My Lords, I must first apologise to the Committee: I was not here for the Second Reading, because transport has never been my top priority in terms of matters that come before your Lordships’ House. Technology has been much more important to me, and it struck me that technology, which is advancing at an incredible pace—its capacity is doubling every two years—affects transport systems almost more than anywhere else.
We think here of the driverless cars that are being trialled at the moment, mainly in the United States, with a certain amount of success. The amount of money that the big tech companies in the United States can put into this means that we are going to get driverless cars within the foreseeable future, and that is going to completely revolutionise the whole business of how our cities operate. The price of taking taxis from A to B is going to come right down, which will affect car ownership. It will mean that people give up owning cars, which are getting more and more expensive, and will rent them for long journeys. At the same time our streets will be much emptier and it may well be, with the introduction of electric cars at the same time, that we reduce the pollution in our cities as well. This is coming whether we like it or not, and we must accept that technology is moving very fast and is going to have an enormous effect.
Driverless cars are tomorrow’s technology. Driverless trains are yesterday’s technology; we already have driverless trains. The Docklands Light Railway, which operates over 24 miles in the East End of London, was introduced in 1987. That is the sort of technology that our new train operators should be thinking of when they start running trains and taking up new contracts. If they do this, it will mean that we can start lowering the costs of operating trains.
I have to say that the history of this is not very encouraging because trains were introduced on new lines on the London Underground, and such was the trade unions’ opposition that those proposals were dropped and they are still driven by operators. This is not encouraging, but we have to look at the whole situation. There will be a lot of opposition to introducing new technology, and the result will of course be that passengers pay much more for travelling by public transport systems operated by people who need not be there.
We have to think now about where technology is taking us in the future. How are the Government going to resolve the conflict with the trade unions, with which to date they have decided on enormous pay increases for driving operators, when in the near future we are possibly not going to need those people at all? Do the Government stand up for the passengers and lower fares, or will they stand up for the wages of train operators who are not actually needed because technology has taken over their jobs?
The same also applies to passenger aircraft—in most airports around the world, ground control can now take off and land virtually any large passenger aircraft. Of course, people feel much more reassured by having a pilot in the seat. On the other hand, I can see the low-cost airlines coming along quite soon and saying, “Well, if you travel in a pilotless aircraft, we will actually lower your fare”. People will then have to decide whether they are prepared to trust the technology.
The basic story still applies: the amount spent on research and development by the big-tech companies is so great that it makes anything that the Government can spend look like chicken feed. At the end of the day, they will iron out the technological problems, and the safety issues will be resolved. At that stage, we will want to see the dividend that comes with that: the cost of travel coming down. The Government will have to decide whether they back the trade unions or whether they want to see cheaper travel for customers.
Baroness Brinton (LD)
I will briefly respond to the proposals from the noble Lord, Lord Hamilton, and ask both him and the Minister some questions. I will not say that the recent BBC drama “Nightsleeper” should give us cause for alarm—the issues are very different—but the noble Baroness, Lady Randerson, possibly the noble Lord, Lord Ranger, and I were heavily involved in the then Automated Vehicles Bill during its passage through your Lordships’ House earlier this year. Some of the questions I will ask now I asked in the debates on that Bill, too.
First, this is not just a question of having no driver, because there has been a push to remove from trains staff other than the driver, whether it is an old-fashioned-style conductor or a train manager. I wonder how on earth the emergencies that cannot be predicted, either by software or by people driving the train remotely, can be resolved. Should those emergencies on the line happen at very short notice and the train has to stop, how are people to get off? This is the point at which I start to talk about those who need assistance. If you do not have any staff on the train, how do you get people off who cannot clamber down and follow the side of the track? The reassurance of having staff on the train in that situation makes me feel confident that, if there were an emergency, I would be able to get off.
The other key role of staff on a train, whether a driver or train manager, is to help when things go wrong. That could include trying to handle people who are behaving very badly, sometimes breaking the law, by alerting British Transport Police. It might include times when assistance goes wrong, such as trains not stopping at volunteer stops. We still have those; there are some between Salisbury and Bristol, where you have to give advance notification if you want to stop at a particular station. As someone in a wheelchair, I would be in real trouble if the train did not stop—and there would be nobody I could notify. Also, if you arrive at a station where there is a planned stop and you were expecting to get assistance, but nobody is there, other passengers would not know how to get the ramp out of the train, and they would not have the keys to do it. I am very concerned about those circumstances. If there are thoughts about having automated trains, the practical side of how passengers interact, particularly vulnerable passengers, concerns me.
Secondly, the Docklands Light Railway is an interesting example, and we see similar driverless trains in many airports around the world. That is fine, but I have some concerns about the concept at this stage. If our railways—the actual rails and their surrounds—are built before the plans for automation, there will be consequences for driverless trains when trees fall down at the last moment and children run across the line. You cannot manage those circumstances without a driver who can pick up an alert, respond, tell passengers to brace themselves and let them know where they need to go for support. For me, this is not about unions; it is about passenger safety. My particular interest is making sure that those passengers—not just disabled passengers but many elderly passengers; look at the demographics—get support from a member of staff on the train.
Lord Snape (Lab)
My Lords, it is a pleasure to follow the noble Baroness, and I agree with every word she said. I will be very brief.
The dystopian world that the noble Lord, Lord Hamilton, outlined is not one that I would have thought would appeal to most people. He mentioned driverless motor cars, but so far San Francisco is the only city, I think, where driverless taxis—confined to a fairly small part of the city—actually work. As we all know, San Francisco is the sort of place that experiments with all sorts of things. Those driverless cars have not really appealed to most other countries, and whether they will do in the future remains to be seen.
The noble Lord says that with driverless cars, the road network will be much less congested. If they are going to be the only way to get around, it is hard to imagine that the road network will be less congested. The roads will be even more crowded than they are at the present.
Returning to the railway network, we have about 12,000 miles of railway, much of which was built by the Victorians. Will we tear up all those tracks to install the necessary equipment to enable trains to be driven without a driver? That is undesirable, as the noble Baroness correctly pointed out. Even trains on a modern stretch of railway line—for example, HS1 has a continental signalling system, which has been introduced on the East Coast Main Line—need a driver, for the very reasons outlined by the noble Baroness.
As for aircraft, I am not sure about the thought of taking off and landing in a pilotless aircraft. If it is ever introduced, the noble Lord, Lord Hamilton, might find himself sitting in splendid isolation. After all, the crash of two 737 MAX airliners due to computer failure—and one near accident, which was prevented by the pilot in charge—ought to be lessons to us all.
I am afraid of the dystopian world that the noble Lord envisages. A train driver with responsibility for 500 lives behind him—and, in some cases, travelling at over 150 mph, as on HS1—deserves every penny of the £60,000 or thereabouts that the noble Lord and the Daily Mail complain about non-stop.
Lord Ranger of Northwood (Con)
My Lords, I will briefly offer my support for my noble friend Lord Hamilton of Epsom’s Amendment 14A and echo the comments of the noble Baroness, Lady Brinton, about what services we are looking to deliver when we talk about driverless vehicles, trains, et cetera.
In referring to my register of interests, I recognise that I have spent my entire career with one foot in technology and the other in transport. The two have overlapped, and we have seen great innovation in technology in transport. This takes me back to what we achieved in London Underground and Transport for London: we looked at how bringing in gate-line technology and new systems such as the Oyster card would enable us to rely less heavily on ticket offices. Eventually we removed a lot of them. That was not just because we wanted to get the people out from behind those ticket office windows; we wanted those people, freed from sitting behind that thick piece of glass, to support passengers on the Underground system by providing assistance, information and other services. This is about innovation evolving the service and removing the need for one sedentary type of activity, enabling something else to happen.
When we think about our trains—again, I note the observations of the noble Baroness, Lady Brinton, on the kind of support that can be required on a train, especially for long-distance journeys—safety and security are primary. It would also be good if we could have more services, if the food and beverage shop stayed open a bit longer because people are there, and even if somebody is there to help you connect to the wifi, which is always eternally promised but sometimes hard to achieve. Having a greater sense of the passenger experience, focusing on developing the passenger experience by freeing people from the role of sitting in the ticket office and allowing them to do other things, will be of great value.
The main point is that we need to leave space for the design of innovation. It is always hard to tell at the early stages what we will be able to do later with that innovation, but as long as we leave space in the Bill to consider it, we can, I hope, achieve our aim of really improving the passenger experience.
Lord Moylan (Con)
My Lords, I am not accustomed to making speeches on technological matters but, on this occasion, I feel I have some modest qualifications for doing so—although I must say in advance that I do so with a degree of trepidation, because nearly everything I know about driverless trains I have been taught by the Minister. I therefore sit in the uncomfortable position of being subject to not only his correction but his immediate correction the moment I sit down and he comes to respond.
It is possible to get oneself into a tizz about these things called driverless trains when what one is in fact discussing is signalling. When I first got involved in railways, I thought that signalling was a system where arms went up and down and red and green lights flashed, but that is all in the past. Modern signalling is, in effect, a huge computer brain that fundamentally drives the trains. It tells the trains when to go, when to stop and how fast to go in between. Its purpose is to maintain a safe distance between trains as they travel, taking account of the speed and the track’s condition and nature. It is specific to the track.
Although the noble Lord, Lord Snape, will find counterexamples—I am sure that he is right to do so—broadly speaking, it is safer to have the train driven by this great controlling brain than it is to have it driven by a human being. A large number of historical train accidents have been caused by driver inattentiveness. Indeed, in Committee on Monday, it was the noble Lord, Lord Snape, I think—it may have been another noble Lord—who drew attention to one cause of such accidents, driver tiredness, whereas the machine does not get tired. It knows what it is doing. It knows where every train is going and where it is in relation to every other.
The noble Baroness, Lady Brinton, spoke of the person who remotely drives the train. There is not a person remotely driving the train; it is the great computer brain.
Baroness Brinton (LD)
From my experience on the then Automated Vehicles Bill, there is a person who watches various vehicles driving. If there is an issue, they will intervene. That is how reassurance was given, so it is not left only to the computer.
Lord Moylan (Con)
My Lords, I was going to come to a point relating to that. I am sure that what the noble Baroness said is absolutely correct in relation to automated vehicles but, like automated planes, automated vehicles are very different from automated trains. An automated plane—indeed, any plane—must be 110% safe and known to be safe before it takes off, because if it develops a problem when it is in the air there is nothing you can do about it.
With an automated train, the approach to safety is totally different. Safety is based on fail-safe devices. If the computer brain sees that something is wrong—for example, if it loses a train on the system and does not know where it is—everything is brought to a stop. That is the solution. That is how you guarantee the safety of not only that train but the trains close to it. The trains further down the line are brought to a stop, which is of course not remotely possible when you try to apply a different technology to the air and to automated vehicles. That is the sort of system we are talking about. The level of automation that can be achieved is graded. Level 3 automation, as it is known, requires a driver to be present, although the driver is not actually driving the train.
My noble friend Lord Hamilton of Epsom referred to the Docklands Light Railway coming into operation in the 1990s. I think I am correct—here, I very much worry that I might have got this wrong and that the Minister will correct me—in saying that the Victoria line, which was introduced in the 1960s, was introduced with automated signalling at level 4. There was a driver in the cab, but they would arrive in stations reading the newspapers. This so disconcerted passengers that a stop had to be put to it and they were told that they could not read the newspaper while they were sitting in the cab, at least not while they were in or coming into a station.
So we know perfectly well that this can be done safely. We know that we can run trains much closer together and provide greater capacity if we have an automated system, because it is safer. That is why, if you go down to the Victoria line today—it benefits not from a 1960s signalling system but from a brand-new signalling system installed in the last few years—you will see the trains coming into the station so fast that the previous one hardly has time to get out before the next one arrives. If you had a driver driving that train, the headways between them would have to be much greater. By comparison, on the Piccadilly line, which, as I have mentioned on several occasions, has a signalling system so decrepit that it is hardly a signalling system at all, you can see how slowly the trains come into the stations. The driver has to conduct himself with great caution whereas, with automated signalling, they will come in faster and stop in exactly the right place. They do not have to make the human judgment that the driver has to make about stopping exactly on his mark; that is what he is meant to do, but it takes time.
I think that everybody who is involved in railways wants to head towards that; it is the direction we want to go in. The question then arises: if you have driverless trains with literally no driver in the cab, how are you going to handle the customers? First, as some people have said, there will be trepidation on the part of customers. I think that will be overcome. Even I have a degree of trepidation; I took some flights over the summer. Not many people realise that the pilot is already pretty redundant in most of the aeroplanes they are flying in. Conscious of this, I was thinking about it when I took off the other day, so trepidation is a factor.
The noble Baroness, Lady Brinton, makes a much more serious point perhaps, which is that services are required for passengers in the train and in the event of an emergency. As I said, an emergency is likely to result in the train being stopped in the middle of nowhere, and possibly stopped long enough that passengers have to be disembarked. Who is going to do all that? Of course the train has to have people on it; it has to have staff on it. Although the Docklands Light Railway has no driver—which, as noble Lords probably know, allows children to sit up front and even adults to fulfil their childhood fantasies by sitting up front—even it has a member of staff on it to deal with the sort of eventualities referred to by the noble Baroness.
There is a sort of fantasy here. I depart slightly from remarks made by some of my Conservative colleagues—not here in your Lordships’ House but in other fora—that this will somehow free the railways from dependency on staff and, therefore, on the unions. It will not, of course, because those staff will have to be present even if they are not in the cab. They will probably be members of the RMT, too, which is not exactly freeing yourself from the trammels of the trades unions.
The general intention behind my noble friend Lord Hamilton’s amendment is an extremely good one. We should be moving, as far as we can, from level 3 to level 4. Over time, it is an inevitability, and the costs involved in doing so will have to be found. The increase in both capacity and safety that will arise from doing so will probably be worth 10 HS2s or HS3s or whatever we provide on the existing lines.
Knowing the Government’s intentions on this will be extremely helpful. Knowing how it will be afforded and prioritised in an entirely nationalised system is something that we would all like to know. I suspect, as on previous occasions, that the answer from the Minister will be that we will have to wait, that he is not going to tell us, that this is a very narrow, technical Bill, that all the goodies are coming down the track in 18 months’ time, and everything else. I hope he is taking account of the fact that the Committee is very concerned about this—that technological change has to be at the heart of the modernisation of the railways and that the Government are going to find the investment capacity to do so. It is a matter of priority and money. Can he tell us about it, please, when he stands up?
Lord Hendy of Richmond Hill (Lab)
My Lords, I thank the noble Lord, Lord Hamilton of Epsom, for this amendment, which would require the Secretary of State and the Scottish and Welsh Ministers to consider each public sector operator’s progress in preparing for driverless trains before awarding a contract to that operator. The amendment appears to be of limited practical impact, as it would not require the franchising authority to do anything in light of the outcome of the assessment. That said, I understand from the noble Lord’s explanation that it was intended as a probing amendment, and I take it in that spirit.
I thank the noble Lord, Lord Moylan, for his acknowledgement of my small amount of knowledge of railway operation, and that part of it that I appear to have transferred seamlessly to him. I have tried to educate him in that manner and, clearly, he has been a good pupil. I did not try to extend that to his political beliefs because at the time, when I was educating him in the operation of transport, I had no reason to do so. I will have a go at that some other time.
I also know about the operation of the Docklands Light Railway, referred to by the noble Lord, Lord Hamilton of Epsom, because I was responsible for its operation for nearly 10 years. As the noble Lord, Lord Moylan, said, every train has an attendant on it. They do not sit at the front. People who enjoy sitting at the front—including me—do so instead. More seriously, the attendant closes the doors, to ensure that they are safely closed, and can drive the train if they need to.
The Government have no plans for the rollout of driverless trains on the national railway network. Considerable technological development work would need to be undertaken to make this a viable proposition. There is some practical experience of automatic train operation in the United Kingdom—on several Tube lines and some on the national railway network too, such as on the core Thameslink route running through central London, where this system is vital in enabling the high frequency of service. There is also some limited semi-automatic operation on the Elizabeth line. However, in both cases, it is not truly a driverless system as the operation of these trains still requires a driver to be present while the train is in passenger service, to operate doors and initiate dispatch.
As a practical operator, and a passenger, I am very sympathetic to the view of the noble Baroness, Lady Brinton, concerning staff on trains. From my experience at Transport for London, I can say that Tube trains which are automatically driven have a driver because somebody has to close the doors, somebody has to be able to stop the train in an emergency and somebody has to at least attempt to fix it if it goes wrong. On a train with up to 1,000 people on it, it makes sense for that person to have some space to work in and even more sense for them to sit at the front of the train, where they can see where it is going. That is the philosophy which we adopted.
The noble Lord, Lord Moylan, is correct. The real reason for that signalling system is to enable more trains to run more closely. My erstwhile colleagues on the national railway network still look disconcerted at the thought of one Victoria line train leaving a platform and before the last carriage has departed into the tunnel, the cab of the next one arrives, and the slower that they do it, the closer they get together. That is why you want signalling systems of this sort. That is the reason for the application—not the proposed application but the actual application—of the European train control system on the east coast main line that is currently being implemented. It has been funded by government. It involves several contractors and many UK jobs, and it is done precisely for the purpose of increasing the capacity of the line, enabling the trains to run closer together, and is a very effective business model. As locomotives and trains are fitted with that equipment in the UK, it will become progressively cheaper to equip new lines and it will improve train capacity on all of them.
I suggest that, realistically, the deployment of genuinely driverless trains on the national railway network is a long-term proposition for which passenger safety, practical feasibility and a business case are far from proven. However, there is a range of on-train systems short of driverless operation that can be deployed to improve train service performance and the overall efficiency of the system. These include relatively tried and tested systems such as forward-facing CCTV, which can be used to monitor trackside risks such as excessive vegetation growth; systems to monitor the condition of track and overhead wires; driver advisory systems, which help improve fuel efficiency and punctuality; and more cutting-edge technologies such as the automatic train operation that I mentioned.
Sadly, as a result of the fragmented system that we have, even relatively tried and tested systems have not been deployed systematically across the network. Instead, they have been implemented piecemeal according to the whim of individual operators as they have procured and specified their requirements for new or upgraded train fleets. A clear benefit of public ownership and the future consolidation of track and train within Great British Railways will be the chance to take a consistent approach to the deployment of existing technologies and the development and testing of new innovations right across the system. GBR can set a clear long-term direction for future rolling-stock innovation across the system, with consequential beneficial effects on reliability and the costs of the entire railway.
I will not make specific statements in favour of particular innovations or technologies as part of the debate on this Bill. However, I acknowledge the usefulness of technological development that the noble Lord, Lord Hamilton of Epsom, referred to, and agree with the noble Lord, Lord Ranger, that innovation and technological development have a significant part to play in delivering the best possible services for passengers at the least possible cost to taxpayers and farepayers. I emphasise that our future plans for the railway are aimed at creating the conditions in which innovation can flourish, within both GBR and the much wider private sector supply chain upon which GBR will depend. On that basis, I urge the noble Lord to withdraw his amendment.
Lord Hamilton of Epsom (Con)
My Lords, I am most grateful to everybody who has contributed to this debate. I point out that my amendment asks for driverless trains, not “staffless” trains. I was not necessarily suggesting that there should be nobody on the train at all. As was pointed out, on the Docklands Light Railway there is always someone on the train.
My noble friend Lord Snape—he is not really my noble friend, but I regard him as a good chum—seems to be a bit reactionary about all this. I would not describe him as a Luddite because that would be rather tasteless, but the technology is coming down the road. It is doubling every two years and will overtake all of us. We might as well prepare for it. I beg leave to withdraw my amendment.
Baroness Brinton
“30ZA Statement of accessibility standards(1) When making a direct award under section 30(1A) the Secretary of State must lay before Parliament a statement to the effect that they are of the view that such an award will comply with the accessibility standards.(2) The Secretary of State must prepare a statement of the standards that they propose to apply in assessing, for the purposes of subsection (1), that a public sector company meets the required level of accessibility.(3) The principles must in particular make provision for the accessibility of—(a) the service;(b) accommodation for individual journeys;(c) booking platforms and other interactive digital services and systems used in connections with journeys on the relevant franchise. (4) In preparing the statement under subsection (2) the Secretary of State must consult such persons as they consider appropriate, in particular disabled people.”Member’s explanatory statement
This amendment places a duty on the Secretary of State to make a statement to Parliament confirming they are of the view that making an award to a public sector company will meet certain accessibility standards.
Baroness Brinton (LD)
My Lords, I declare my interests as a vice-president of the Local Government Association and of the Accessible Transport Policy Commission. The first amendment in this group, Amendment 17, continues the debate that was started at Second Reading on the concerns over the provision of assistance services and trains for disabled passengers.
Also in this group are Amendments 27A, 38 and 39. On Amendment 38, which I support, I just want to point out that the disabled passenger card is very important to disabled people. Scope tells us that the average disabled household faces £975 a month in extra costs and that, after housing costs, the proportion of working-age disabled people living in poverty is 27%. That is higher than the proportion of working-age non-disabled people, which is under 20%.
Travel is a luxury for many, but if they want to buy a ticket in person, and there is no ticket office available at their station, they cannot use their disabled passenger pass with a ticket machine. This amendment talks about other key ticketing issues that we need to address. Amendment 27A in the name of the noble Lord, Lord Moylan, is an amendment on ticketing but does not highlight these specific details that I find inconsistent and confusing. My view is that it may be helpful to have this detail in the Bill for the annual report, because the annual report is also a helpful route to transparency and accountability.
Amendment 39 would require the Secretary of State to establish an independent body to monitor the impact of the Act on passenger standards, and I welcome that too. I hope the Minister does as well.
Amendment 17 in my name—I thank the noble Baronesses, Lady Randerson and Lady Grey-Thompson, and the noble Lord, Lord Moylan, for adding their names to it—puts in the Bill a requirement for the Secretary of State to abide by the law in issuing a statement of accessibility standards and confirmation that a public sector company meets the required levels of accessibility. This is about not just the accommodation for individual journeys but the entire service, including booking platforms and any other digital service or system used.
It also includes toilets, which I know appear later on, but let me just say on this subject that I spend my life sitting opposite open toilets because wheelchair spaces are always by the toilets. When they are not very clean, it makes journeys every single day extremely unpleasant, but another effect is that if you are sitting in a wheelchair you become the toilet monitor when either there are people inside it or it is not working. The passengers look at you crossly as if it is your fault that they cannot get in. I see that the noble Baroness, Lady Grey-Thompson, understands what I am talking about.
Why is this amendment necessary? At Second Reading the noble Baroness, Lady Blake, when she introduced the Bill, spoke about services only in the context of cancellations and disruptions, and there was nothing about the actual experience of the passenger. In the context of Amendment 17, the passengers requiring assistance are not always disabled, by the way. As I said in the debate on the previous group, we have to recognise the demographic change in this country, and a lot of passengers will require assistance in the future because they are getting elderly.
I am grateful to the noble Baroness, Lady Blake, who, following my speech, in her winding speech said that
“there has been some improvement over the last few years—for example, the new two-hour booking window for assistance and the Passenger Assistance app”.—[Official Report, 7/10/24; col. 1894.]
Neither of those two things is an actual improvement for disabled passengers. Yes, very large amounts of money were spent on developing two apps, and the first is for passengers. When that was being consulted on, all the disability groups and individuals asked for the capacity to be able to buy their tickets at the same time, but it does not permit that.
Why is that important? For some journeys you have to book a seat—a literal seat—when you buy your ticket, for example from Trainline or from a train operating company that you start your journey with. I quite often do journeys from Watford to Euston, Euston to York or Euston to Edinburgh. If I do not go on to the LNER app, I have to get a ticket reserved via the West Midlands app. It is a seat that I cannot use. Anyone who travels on LNER regularly will know that, at peak hours, there are no seats available, yet there is one with a sign above it saying “reserved” that I cannot use. If I have time, I will find the train manager before I board the train and say, “By the way, I have G16 reserved. I am not going to be sitting there”. This is a software problem but, perhaps more importantly, it is a problem of Network Rail and others not listening to the needs of disabled people.
You then have to ring or email the train operating company for that leg of the journey and book your assistance separately. LNER tells me that I should use all the different apps for each leg of my journey, but the whole point of the app was that the passenger should have to enter only one thing. The total irony of this is that behind each of the train operating company apps is one single app. It is an absolute nonsense, and it is all because disabled people were ignored. The noble Baroness, Lady Campbell of Surbiton, were she in here place today, would remind us that she and many other disability people have championed “Nothing about us without us” for many years, but the rail industry has not yet understood it.
Baroness Grey-Thompson (CB)
My Lords, I apologise for not being able to be in the Chamber at the start of proceedings at Second Reading. I had a long-standing commitment in my diary that meant I was not able to be here. I also draw noble Lords’ attention to my entry in the register of interests. I chair the commission for accessible transport and I attend some of the Avanti accessibility panel meetings as an observer.
I thank the noble Lord, Lord Hendy, for meeting me prior to the start of this Bill to discuss some of my frustrations about how disabled people are able to use the railway network. I broadly welcome this Bill, and anything we can do to make it better for disabled people is worth exploring. I have lots of aspirations for the various Bills we will see on the railway industry in this Parliament, but my aspiration for the next phase, when I am asked what I want as a disabled person, is just the same miserable experience of commuting as everyone else. I am not asking for any more than that, but it sometimes feels that the way the network is set up makes it incredibly difficult for disabled people.
As much as I used to hate travelling in the guard’s van, at least when I did that as a wheelchair user I was not left on a train. I would like to thank many in your Lordships’ Chamber who came up to me and expressed their disappointment, anger and all sorts of various emotions when I was left on a train just before I went out to Paris for the Paralympics. It was not the first time that it happened and it was not the last: since returning from Paris I have been left on another two trains, but I did not have the energy to post about it on social media. In both cases, the two people who helped me very quickly to get off the train did not have the authority to do so and could have faced penalties within their jobs or even potentially been fired for not being in the position to do so. What has come out of that experience is that a number of disabled people have written to me to explain the issues they face. My feeling is that the failure rate is way too high, and many disabled people do not even try to travel because of the fear of what they expect. Getting on and off a train should be relatively simple, but it is not.
The noble Baroness, Lady Brinton, talked about the booking apps. It is better that it is down to two hours from six, because when it was six hours disabled people needed to know each train company’s operating procedure, and whether it was six hours during the opening times of the call centre or six hours before the train they wanted to catch. I imagine that some of the failures have dropped. I do not think it is realistic to expect disabled people to know every single train company’s process before they book a train. The promises of not just the best priced ticket but the in-person comms would have made a real difference to disabled people being able to travel. Personally, I use five different apps to buy tickets. Prices are hugely variable and, bizarrely, it is sometimes cheaper to use one train company’s app to buy a ticket when you are travelling with a completely different train company and then book it a different way.
I felt the noble Baroness’s pain when she talked about the wheelchair space. It became clear through Covid that the wheelchair space does not appear to be on the booking system as a seat, so when I tried to travel at the back end of Covid, when we were able to, I was not able to count it as a seat. You would turn up at a train station and, even though you booked the wheelchair space, they would refuse to sell you a ticket. Even now, I feel terribly guilty, when I buy a ticket from various different apps, that I am allocated a seat that I have no intention of ever being able to use. It just does not make sense that this is still the case, especially on busy trains and when we are trying to make it easier for everybody to travel.
I am also really worried that the train operating companies and the Rail Delivery Group are forgetting that people have a legal right to turn up and go. When we see posts online or articles written, they are always about booking. If there is an assistance failure, the first question the disabled person is asked is: “Did you book?” If I am on a train and I am not helped off it, booking is completely irrelevant. It is quite annoying that I am asked the question, because I did not magic my way on to the train without anyone else being involved in the process: somebody helped me on and somebody knew that I was on the train. The failure is communication somewhere along the line: people did not look at the app or nobody picked up the phone. I am really worried about the victim-blaming of disabled people. This, again, discourages people from travelling.
We really do need accurate data on failure and how the app is used needs to be properly recorded. I have been told that people who turn up and go are put into the app and the assumption is made that they booked, so although the booking numbers look like they are going up it is not fair to lump the two sets of people in together. We have to be able to accurately measure the number of people who do not know what time they will be able to travel because of work, or because they just do not know. Not everybody can set out their schedules according to what the rail companies would like to happen; I am sure they would like everybody to book two hours before they travel.
What happens when assistance fails? Disabled people are actually just quite tired of complaining. They are constantly fobbed off and told it will never happen again. The train companies are always very sorry, but nothing really seems to happen to bring about change. The Office of Rail and Road following up a couple of months later, asking whether you had a good journey, does not seem the most accurate way to track some of these issues. Quite frankly, I really dislike having to book, but I cannot face having to turn up at a train station and almost feel like I am begging to be allowed on the train. I also have to feel very apologetic: “Do you mind if I get on? Is it possible?” I never expect to get on a train that is leaving within the next 15 or 20 minutes, although I have had some fantastic experiences at Waterloo—and I have had some not so great experiences there. It comes back to how disabled people are made to feel welcome, or not, when they want to travel.
Too often, failures are described as an inconvenience rather than something that can affect people at quite a devastating level. South Western Railway recently posted that if someone books assistance and did not get it, they might be entitled to their fare back. This is inaccurate for a number of reasons. First of all, it ignores our legal right to turn up and go, but just saying you can get your fare back seems a bit weak when, if somebody successfully sued that company, it would be a minimum of £1,200 on the Vento scale for a single failure. Again, disabled people are meant to feel grateful just because they get a few pounds back for what they experienced. There are a number of disabled people who are not particularly liked by the railway industry because they very successfully sue, but they are able to do that because they constantly experience really appalling treatment.
I have always recognised the huge privilege I have, either of being an athlete or from being in your Lordships’ Chamber. I experience way better treatment than any other disabled person I know. Since the failure I had a couple of weeks ago, I now have two or three people meet me off the train. I feel like a member of the Royal Family; it is absolutely wonderful. People ask me if I am okay. I am now shown the app and that I am on the app. I am given the name of the person who is there to meet me. That is lovely: I can welcome them by name when they come to meet me. But this is not real; this is not the experience that disabled people are having.
There is still too much inaccurate information out there about whether lifts are working. The noble Baroness, Lady Brinton, raised toilets. We are meant to be told whether they are working on trains; we are not, so it is always a mystery, when you get on a train, whether you can use the bathroom. I already control what I drink before I get on a train to make sure I do not have to use it. These are the things that disabled people just do not complain about because it is too confusing.
The accessible transport policy rules are way too confusing. On the impact of derogations, I have a friend who cannot travel on Northern Trains because he has a mobility scooter. They are banned from travelling on trains in the north-east, as the class 158s have no entrance vestibule and they restrict manoeuvrability into the wheelchair area. ScotRail has a different set of policies about what mobility device you can use on trains. This all has to join up, because you could end up going to Scotland as a scooter user and not being able to leave because you use a different way of getting back.
We need reliable data on assistance fails. I am at the point of believing that we now need significant financial operator penalties for failures. The D50 tickets need to be available online, in vending machines and onboard. Actually, we need more training, because people at some stations do not even know what a D50 ticket is. The failure data then needs to be analysed for failure hotspots, which I know has been done at Euston and has had a positive impact.
The staff app needs to be sorted out. At the moment, as I understand it, not all TOCs use it and there still needs to be union agreement involving the technology payment.
There is loads that we need to do to make things better for disabled people, and I look forward to working with the Minister as we progress the Bill.
Baroness Scott of Needham Market (LD)
My Lords, I would like to say that it is a pleasure to follow the two noble Baronesses but actually it is not. It makes me so angry that, week after week, they come to this House and tell us about the problems they have. When they do that they are telling us about not just their problems but the problems being encountered by tens of thousands of people, day in, day out. My Amendment 39 is about the passenger standards authority. If anything demonstrates why we need a passenger standards authority, it is the experience that has just been outlined.
The passenger standards authority is part of a package that will come later and is not part of the Bill, but I want to raise it here because passenger standards are the reason for the Bill and why we are here. As we have been hearing over the past week or so, a combination of fragmentation within the industry, poor tendering and inadequate enforcement has led us to the situation that we are in now, but it seems to me that there is something about an organisational culture that is the complete reverse of being passenger-focused.
One of the problems we are facing is that the way that we measure the performance of train operating companies is legalistic and algorithmic; so on one side of it, you are all right and no action will be taken, but step a little further and action will be taken. For passengers, that feels arbitrary. I would like to hear from the Minister how the passenger standards authority is going to work. How will it hold the operator to account in a way that so demonstrably has not been done in the past? Will it be taking a similar, very measured approach, or can it really get into the nitty-gritty of what makes passenger journeys work?
Of course, that includes punctuality, reliability, ticketing and accessibility, but there is a bunch of other things, as we have heard from noble Lords, such as the provision of consistent, understandable information; trains that are clean and properly staffed and on which people feel safe; some sort of functioning wifi; and the ability to get a cup of tea on a long journey. These things are all part of the passenger experience and should not be that difficult.
Is the passenger standards authority going to have the ability to represent passengers right across the piece? Will it be genuinely about driving improvement, not just constantly having niggles with train operators about whether they are not quite good enough or not quite bad enough? I look forward to the Minister’s reply.
Lord Moynihan (Con)
My Lords, I declare my interests as set out in the register.
I support Amendment 17, in the names of four eminent Members of your Lordships’ House. I hope that I will be forgiven if I also say that I declare the interest of having worked with the noble Baroness, Lady Grey-Thompson, on these issues and duty of care and accessibility for many decades. In fact, we go back to the point when, as Minister for Sport, I approached the International Olympic Committee to ask it to consider ensuring that all the facilities used by a host city for the Olympic Games should immediately be used thereafter for the Paralympians. That was not just so that we could look at athletes and focus on their abilities rather than their disabilities, but to change the mindset of the population. A lot of what we have been talking about this evening is about changing that mindset. It is about changing attitudes: we cannot simply put in a statement of standards and allow it to gather dust; we must make sure that that statement of standards changes attitudes.
The Government have a great opportunity to include a statement of standards in this legislation. No party has a greater interest in accessibility than any other party. We all passionately agree across the Chamber about the importance of responding to the proposers of the amendment we are debating. This Bill is an opportunity to recognise that and move forward to a new level of recognition and understanding about what should be in a statement of standards.
All train operating companies should be committed to providing infrastructure and rail services to the highest standard of accessibility—that is the starting position—and customer service for all customers and stakeholders. There should be accessible travel policies outlining their approach to providing assistance to customers with restricted mobility or who require assistance, including those with visual or auditory impairments, learning disabilities and non-visible disabilities. This policy should be placed in a statement of standards and should be aligned to other legislation, such as the Equality Act and the Rail Vehicle Accessibility Regulations 1998.
Passenger Assist is a national system supported by all train operating companies at the moment. I hope it will be supported in future, because it is vital that we arrange passenger assistance for disabled customers and those with restricted mobility. At present, national technical specifications for interoperability define technical and operational standards to ensure the interoperability of trains, not least into the European railway system, and must include accessibility standards for new stations or major work on existing stations. Let us embed that into a statement of standards. The Public Service Vehicle Accessibility Regulations ensure that vehicles used as rail replacement services are accessible. All involved should implement these standards for all new infrastructure, in addition to adopting innovation and best practice.
Level boarding is an incredibly important issue. All new train fleets being introduced should have a slightly lowered floor height compared with typical trains in the UK and should be provided with a retractable step to close the gap between the train and the platform. This would mean that all passengers should be able to board and alight without assistance, at all platforms, once the long-running transformation in this country is complete and all platforms have been brought into alignment. Let us embed that into a statement of standards.
I shall touch on two other things. The first is persons with reduced mobility national technical specification notices. At present, NTSNs define the regulatory requirements for infrastructure and trains, to ensure accessibility for people with reduced mobility. They include standards for the design, construction and maintenance of railway systems to make them accessible. Braille and prismatic signage at our major stations should be an essential feature and should comply with the PRM NTSNs.
On braille signs, let us take the situation in Wales. Braille signs should be in both languages; they should be in Welsh as well as English, aligning, in that case, with the Welsh Language Act’s commitment to preserving the language. This initiative not only supports the ethos of that Act but enhances accessibility for individuals with impaired vision. I hope that the noble Baroness, Lady Randerson, will agree with that.
Finally, there should be station design toolkits specialising in wayfinding requirements and colour schemes, to ensure consistency and accessibility. That includes principles for signage, fonts and colours, to create a high-quality station wayfinding system.
This Bill provides a unique opportunity to include a comprehensive suite of accessibility reforms and to introduce a standardised and consistent approach to accessibility standards across the railway network. All of us across the Chamber agree on the importance of the subject. Here we have a real opportunity to have a statement of standards of the highest possible quality enshrined in legislation. I look to the Minister and the Government to at least take that away and think about it as an important step forward that would gather support across the Chamber and respond to the worrying concerns that have been expressed by the noble Baronesses in Committee tonight.
Lord Berkeley (Lab)
My Lords, this has been a very depressing debate—listening to the terrible problems that many noble Lords have had in using the rail network. It is wonderful that they have been able to expose them so widely. We have heard about them before, but it is depressing that we are in 2024 and they have not been solved already. All this could have been done years ago, without legislation and without any change. It just needs somebody to do it and to take responsibility for it. So the list of the noble Baroness, Lady Randerson, is very good—all the lists are good. There are three things that I hope my noble friend will take forward.
There are three different elements to the GBR responsibility. One is the infrastructure—platforms. One is the trains—level boarding. The other is services—what people do or do not get at the stations. Most important is that the passenger standards authority, mentioned by the noble Baroness, Lady Scott, must be not only comprehensive, strong and fast but independent.
We have to think about how you can be independent of the Government and the railways, and still have credibility. I hope everybody can, but the Government will have to accept something that is independent, rather than something which takes backdoor instructions from Ministers who say, “Don’t get too strong on this, because it’s too expensive”.
We will have to watch this for a long time, but I congratulate other noble Lords who have spoken in this debate and exposed this, which should have been exposed a very long time ago.
Baroness Randerson (LD)
My Lords, I believe this is the most important group of amendments today because it has passengers at the core. I have added my name to three amendments because I am so convinced that the comment made earlier about the lack of focus on passengers in the current fragmented rail system has done so much damage to the rail industry.
When things go wrong—and things go wrong all the time—the train operators spend their time deciding whether it is their fault or Network Rail’s fault, instead of concentrating on putting it right for the passengers. To my mind, this is the obvious way ahead. I remind noble Lords that we live in an ageing society and the railway has to operate for all.
Not all disabled people are in wheelchairs. When I get on trains, I watch people who are capable of walking being helped by staff, or by other passengers, to get on the train because it is difficult. It must be made easier. Once it is made easier, you give people confidence; once you give them confidence, they become train passengers much more willingly.
I broaden it even further. The noble Lord, Lord Moynihan, referred to people who have a visual impairment—quite rightly. I wish to raise the issue of people with hearing impairment. I have 30% hearing. I wear hearing aids, which improve that considerably, but they do not bring me anything like up to normal standard. Unfortunately, one recent Saturday evening I was at Paddington station for over four hours, while no trains ran. Announcements were constantly given only over the loudspeakers. Every time a loudspeaker announcement was made, I had to go up to someone and say, “Can you just tell me what he said?” Of course, people were basically in a panic and they were not doing it clearly. Eventually they gave up and said that no trains would run to Wales at all that evening. But the point I am making is that, over four hours, that situation took no account at all of people who could not hear clearly.
Lord Moylan (Con)
My Lords, we have heard some very powerful and moving speeches, based on their own personal experience, from the noble Baronesses, Lady Brinton and Lady Grey-Thompson. I feel it would almost be impertinent of me to try to add to what they are saying, given how rich and deep their experience is of travelling on the railways as passengers who are confined to wheelchairs. They also spoke, as did the noble Baroness, Lady Randerson, and others, of those with other forms of disability, including those affected in their sight and their hearing.
However, if I were to add anything of any great substance, it would probably be along the lines of the excellent speech made by my noble friend Lord Moynihan, who clearly set out a programme—a challenging and demanding programme, admittedly, but one that should be embraced by the Government and by Great British Railways—for improving the experience of disabled passengers on the railway. It is very important for us to hear what the Minister will have to say in response to that. I know that he personally is very sympathetic to the experience of disabled passengers and the difficulties they have. However, although I do not make this as a personal remark, Network Rail as an organisation has been making similar noises for a long time, yet the difficulties continue—perhaps not always the same difficulties, and there are some improvements from time to time, but none the less the difficulties continue, and here we are today, hearing these speeches. I look forward to what the Minister has to say.
I was interested in the amendment proposed by the noble Baroness, Lady Scott of Needham Market, in relation to the passenger standards authority. We have heard too little in our Committee debates so far about the role and purpose of that authority. It is promised in the document Getting Britain Moving, but what scope it will have as a strong voice for passengers—that is how it is described—and how it will be much in advance of the existing passenger representative bodies, we have yet to learn. It would be helpful if the Minister could explain his vision for the passenger standards authority. I hope we do not have to have that deferred until we hear about the next Bill coming down the line at us, because I think it is what people want to hear.
I have an amendment of my own in this group. It will not take me a great time to speak to it. It relates to something else that we all want to know about: discount fares. Perhaps I should declare that I am the holder of a senior railcard—I hear a certain hum around the Chamber that suggests, to my surprise, that I may not be alone in that—but there is a multiplicity of other railcards too. If you click the button on the website that says, “Apply a railcard discount to this fare”, you will find a drop-down box containing a whole list of the various railcards that are available. I think passengers want to know that those railcards are going to continue to be available to them in the new system.
One of the difficulties that the Government have—indeed, that we all have—is that we are told, “We’ll pass this Bill and then everything is, so to speak, frozen until we get the next Bill”. As I have said repeatedly, and perhaps I have bored the House by saying it, simply getting the next Bill does not change anything. Change has to follow the Bill, and change is itself very time-consuming to implement. So, even on a good timetable for the Government, we are talking about four or five years before we see change, yet we are getting the impression of life being frozen in the meantime. Hence, we get pleas from the noble Baroness, Lady Randerson, for something to be done about ticketing in the meantime. We all want to know, not just on ticketing but on other matters, what is going to happen in the meantime when, in a sense, no one is in charge because shadow Great British Railways will have been set up but it will have no powers. We will be awaiting Great British Railways and things will not actually be happening.
To come back to my own amendment, that situation applies also to discounted fares. Are they to continue as they are? If they are to be changed—and there may be an argument for change; it may be that a new one has to be added or some have to be deleted, merged or changed in some other way—what would be the mechanism for doing that? I do not mean simply the legal mechanism, because that exists already and it is not being abolished, but who is the driving force behind that? What is the machine that is going to run that sort of thing and make the decisions? We would like to know about all those things. We want some assurance about their continuation but, more importantly, we would like an understanding about the change and the directing mind in this transition period, which could go on for several years.
Lord Hendy of Richmond Hill (Lab)
I thank the noble Lord, Lord Moylan, for the remarks that he has just made. He talks of delay and nothing happening. One of the reasons why I personally am here is that I have been waiting six years for rail reform and, in the end, when I was asked, I volunteered to see whether I could move it forward, because it has taken a very long time. Not much has happened since the timetable crisis of 2018 and the report that Keith Williams wrote.
I thank the noble Baronesses, Lady Brinton, Lady Grey-Thompson and Lady Randerson, for Amendment 17, which is supported also by the noble Lord, Lord Moylan. I absolutely recognise the need to address the passenger experience, and I know that my noble friend Lady Blake, who took the Second Reading, recognises it too. Improving accessibility on the railways is a key priority for the Government and something that the Secretary of State and I are personally committed to. We know that the assistance that passengers receive too often falls short of what they deserve and what they have every right to expect.
I was going to list a range of areas where things need to change, but I am embarrassed to do so because so many speakers in this debate have listed them themselves. All I can do is acknowledge that I have heard the list quite clearly. We know that we need to do better, and it hurts me that the public service that I care about fails so regularly to look after people in the way that it ought to. I personally—and the Secretary of State is in the same position—will do my best to do differently in future.
Many of these issues are, frankly, best solved under public ownership, as the problems that have arisen are a direct result of the current fragmented system. For example, on the specification of new trains, which the noble Baroness, Lady Brinton, and others referred to, a guiding mind will take an approach to a greater consistency of design and improve the outcomes for disabled passengers.
In addition, it has been explained, more eloquently than I can do, how many apps there are, how weak they are and how they fail to work. The noble Baroness, Lady Grey-Thompson, took me through, and showed me a huge litany of things that are wrong with, a variety of apps, all of which she needs to make quite simple journeys. I am terribly embarrassed by that. Why should we need so many different electronic devices to deliver such a relatively poor service and outcome in such circumstances? That is an obvious case where consistency is desirable. I referred earlier today to not having a proliferation of train operators, and this is one of the reasons not to do so. We do not want everyone inventing their own process; we want one consistent process, designed with the people who use it, not done for them and not delivered to them after it is done. I have heard the experiences of the noble Baroness, Lady Grey-Thompson, and others of getting something that they wanted but then discovering it did not do what they wanted.
I contend that one of the clearest reasons for the Bill, which seeks to take train operations back into public ownership progressively, is to make those sorts of improvements a great deal easier to deliver in future. Public ownership and control give us the best platform possible to do that. I appreciate the engagement that I have had to date, especially with the noble Baronesses, Lady Brinton and Lady Grey-Thompson. I believe I have offered a meeting to both of them— I hope I have, but that is done for me—and we will have that before Report. That is not an explanation; it is more of an apology, but I hope that for now it will allow them to withdraw their amendment.
Baroness Brinton (LD)
My Lords, I thank all noble Lords who have spoken to this group of amendments. I thank the noble Lord, Lord Hendy, for his very helpful comments and look forward to hearing from his office about a meeting. I will not go into details, but his comment about poor apps resonates with every disabled user.
I am grateful to the noble Baroness, Lady Grey-Thompson, for her comments, not just for further experiences of being left on trains but for her key point that nothing seems to change. My noble friend Lady Scott was right to say that this is all about the culture of the organisations in the TOCs. The issue is the culture at the top, not the culture of the staff whom we see face to face, and it is important to recognise that.
I am very grateful to the noble Lord, Lord Moynihan, for his excellent speech. He is right that all parties do agree on this issue, but why can we not get any change? A new station opened at Thanet Parkway in July last year. Not only do you need lifts to get up to it, but you do not have level boarding and it is not staffed all day. How, in 2023, was that allowed to happen? Pre-pandemic, there was a pilot for level boarding at Harrow & Wealdstone; it was abandoned because the train operating companies could not agree on an order of coaches to make sure that the level part was available.
My noble friend Lady Randerson was right that we have to focus on the needs of passengers, and my amendment in this group focuses on those who need assistance. We need this amendment. We have to be able to hold train companies to account. My problem is that my amendment is for the future; it is not for now. If there are any further delays, we will see yet again no further change. I ask the Minister: what change can we start having in the current poor standards of the train operating companies?
I remind the Committee that bus regulations were transformed in 2016 when a disabled passenger took a case to the Supreme Court. Perhaps we need the same thing to happen now; I hope not. We will return to this on Report but, in the meantime, I beg leave to withdraw my amendment.
Passenger Railway Services (Public Ownership) Bill
Wednesday 23rd October 2024
(4 weeks, 1 day ago)
Lords ChamberRead Full debate Passenger Railway Services (Public Ownership) Bill 2024-26 Read Hansard Text Watch Debate Read Debate Ministerial Extracts Amendment Paper: HL Bill 21-II Second marshalled list for Committee - (22 Oct 2024)
Lord Moylan
“30ZA Independent financial monitoring of public sector companies(1) The Secretary of State must, within three months of the day on which the Passenger Railway Services (Public Ownership) Act 2024 comes into force, instruct an independent body to conduct monitoring of the financial management of any public sector company with whom a direct award of a public service contract is made under section 30(1A).(2) For the purposes of subsection (1), “monitoring of the financial management” includes the auditing of accounts, the review of spending efficiency, and the making of recommendations to improve cost-effectiveness.”Member’s explanatory statement
This amendment requires that the Secretary of State instructs an independent body to conduct financial monitoring of the public sector companies.
Lord Moylan (Con)
My Lords, I suspect that this will be one of the shorter debates in our consideration of this Bill in Committee, but it is one of the most important. It will be short, I suspect, because this group is rather technical, but it has very great significance, not only for the operation of the railways but for the passenger experience.
There are four amendments in this group, all of them in my name. The first two, Amendments 19 and 20, are closely related. They relate to the very peculiar situation in which we are now going to see the railways operated in this country: that is, that they are going to be practically unmonitored independently as far as their finance is concerned. Compare the railway sector to the water sector or to electricity. These sectors have economic monitoring to ensure that best value is being delivered to the customer. Nothing of the sort is envisaged in relation to our new nationalised railway. There is to be no economic monitoring and no supervision of the setting of fares, and that is what these amendments relate to. One is to do with charges to customers—that is Amendment 19—and the other is to do with the costs incurred by the utility. The railways are a utility, and that is how they are going to be run.
Of course, if they were run by the private sector—as they would be if they were water or electricity—that economic monitoring would cover both the costs charged to the customer and the costs incurred by the operator, because their efficiency would be monitored. As I say, none of that is envisaged here. We are asked to assume that, in public ownership—I am not now talking about a Bill that is going to come to us in 18 months; I am talking about the direct consequences of this Bill as soon as it starts to come into effect and as these franchises move over—the Government are going to set fares in a reasonable way that is not exploitative of customers.
It could be said that that can be assumed because it is not going to be run by the private sector—that the Government are not going to gouge our eyes out, because Governments do not do things like that. But they do. Tell somebody who is applying for an urgent passport at a cost of £1,000 that they are not having their eyes gouged out. Tell someone applying for a statement of their nationality that recognises an existing British nationality who is charged well over £1,000, including each time for their children on top, that they are not having their eyes gouged out—that is several thousand pounds for a family that are already British and simply want to have it recognised, as they are allowed to do, and register as British because they are already British.
We know from experience that Governments are perfectly willing to charge very high fees for their services in order to make a profit. Sometimes, this profit has been complained about—for example, in relation to nationality, not least by the noble Baroness, Lady Lister of Burtersett, and others on the Labour Benches when we have debated matters such as that.
Who will decide how fares are set, what the logic is, and what the railways’ aim is in setting those fares? This is particularly true in the case of railways, because they inevitably have variable fares. It is part of the nature of a railway that they aim for the highest return they can get from particular passengers; they are then willing, because of the nature of the structure of the business, to take marginal fares to cover marginal costs from other passengers who might pay very little for the same journey because they are willing to go at a certain time or book a certain distance in advance, and things of that sort. Those who do not have that advantage may find themselves being gouged because they need to travel at the last minute or because they are captive customers. Do not forget how many captive customers the railways have. There are not necessarily a lot of captive customers on the long-distance railways, but on the commuter network, especially around London, they are, in effect, captive customers. How attractive to the Treasury to turn the railways into a mill for generating money for the Government, if that is what it wants to do.
I am not saying what the fares policy should be. What I am saying is that there should be some independent monitoring of how it is done so that customers—or passengers, as I must remember to call them, remembering what I said to the noble Lord, Lord Snape, the other day—do not find themselves trapped in a system and exploited. No independent monitor is proposed, so we have to trust either the Department for Transport or Great British Railways. I am not sure which it will be in the long term, but in the short term, over the next few years, we have to trust the Department for Transport to set fares in a way that is not designed to maximise revenues from those who cannot resist paying them.
Similarly, if this were in the private sector, through the setting of charges there would be economic regulation—as there is in the water industry, at Heathrow Airport and so forth—of the efficiency of the costs with which the railways conduct themselves. There is no sign of that either in the Bill. Again, we are asked to trust the Department for Transport to ensure efficiency. Considering how many staff the Department for Transport employed to monitor and shadow the staff employed by HS2 Ltd, I do not regard it as a great guarantor of the efficiency of delivery and the control of costs. There ought to be an independent body to do that.
That deals, as far as I am concerned, with Amendments 19 and 20. We then come to Amendment 23, which is rather different but again relates to something the public should be entitled to know about: the great transfer of pension liabilities that will occur as a result of moving pension responsibilities from the train operating companies to the Department for Transport. I want to be clear about this: I completely understand that the staff are largely currently members of the national rail pension fund and that they will remain members of the same pension fund. The contributions and so forth should not in themselves change simply because of the Bill—I perfectly follow that. The costs will not increase as a result, but the purpose of this amendment is to probe where they will lie in balance sheet terms. Will they be a liability fully on the Government’s balance sheet? What consequence will that have for the national debt? This is something that we should know, because the railway pension scheme is, obviously, one of the largest pension schemes in the country. These are not trivial sums; they are very significant sums in terms of pension funds.
Finally, I have Amendment 25 on lease payments. I will not trespass into this very deeply because a similar amendment in the name of my noble friend Lord Young of Cookham is due to be debated later, and I know that he is much more knowledgeable about these matters than I am, but it is certainly the case that the lease arrangements that exist for the rolling stock are between the train operating companies and the roscos, the rolling stock finance companies. That is where the lease liability exists. Are these to be transferred to the Government? If they are, where will they sit in balance sheet terms? What balance sheet effect would that have? Therefore, there is the question of public debt.
There are two separate strands to these four amendments. One strand relates to balance sheet liabilities and the effect on the Government’s balance sheet of the measures proposed. We are told that this Bill has no cost implications, but is that true? The other relates to how we ensure that the railways are properly and independently monitored to make sure that the fares they charge are not exploitative in circumstances where exploitation is open to them, that their costs are efficient and that they are efficiently delivered. Simply saying that we should trust the Government or the Department for Transport on this is, I suggest, not a satisfactory answer.
Baroness Randerson (LD)
My Lords, one of the clear attractions of the new system should be increased transparency. There should be no chance that the new authority would be able to hide behind commercial confidentiality. One public body would make life very much easier in terms of national answerability. I do not agree with the mechanism suggested by the noble Lord, Lord Moylan, but he is making a valid point. Can the Minister confirm that the passenger standards authority, the passenger body that is going to be the champion of passenger standards, will have the power to investigate fares and report on problems? I gently point out that the Government will no longer be able to blame the train operators. All the blame will now fall on the Government, and passengers will make judgments based on that. It is therefore important that there is a public way for the Government to explain their decisions in relation to train fares and the fare structure overall.
The Minister of State, Department for Transport (Lord Hendy of Richmond Hill) (Lab)
First, I briefly note my intention to write to the noble Lord, Lord Teverson, on his points about public investment that I did not manage to address on Monday. I also intend to address later the question asked by the noble Lord, Lord Young of Cookham, on Monday.
On fares, there is nothing new here. The regulation of fares has always been by government through its contracts with operators, whether public or private, and as far as this Bill is concerned, that will continue.
Baroness Randerson (LD)
I want just to make the point that, as the Minister well knows, the fare system is so complicated that, in practice, people have not been able to understand it adequately in order to make those judgments, and one of the Government’s aims, quite laudably, is to make it simpler. I also point out that the Minister is talking about regulated fares, and I think about half the fares in the market are not regulated.
Lord Hendy of Richmond Hill (Lab)
I thank the noble Baroness for her intervention. Of course, she is absolutely right. The fare system is far too complex, whether it is regulated fares or unregulated fares. One of the primary purposes of bringing train operations into public ownership is to provide the basis of rationalising that fare system without the associated complications of either compensation to private sector operators or, indeed, their saying that some of the information needed to do that is commercially confidential and hence cannot be used to rationalise the system that nobody understands.
On Amendment 19, the department already holds its public train operating companies to account for their financial management through regular review of their management accounts and business plans, as part of its routine contract management activities. That is equally true in relation to privately owned operators whose costs are funded by taxpayers. This scrutiny supports the monitoring of performance against the Secretary of State’s priority to deliver an affordable and sustainable railway. The amendment refers specifically to the auditing of publicly owned train companies’ accounts. It is already the case that those companies must publish their audited accounts annually, which are available in Companies House, so there is already full transparency of their financial performance and management. The proposed amendment would add little value to the existing scrutiny of their financial performance by DOHL ass shareholder, the Department for Transport’s contracting authority, and their own financial auditors, as well as the public via the public audited accounts. That would be an unnecessary additional cost to be borne by the taxpayer which I cannot support.
Regarding Amendment 20, the department already publishes information on its website about payments made to operators under its rail contracts. The department’s published annual report and accounts also detail the department’s expenditure on each contract, as well as any associated year-end balances in respect of payments made in advance or still due to be paid. The Bill does not change that, so there is no need for the taxpayer to pay for an independent body to report on the same data. As I have said previously, the most significant financial impact of the Bill will be that taxpayers will no longer have to foot the bill for tens of millions of pounds in fees paid to private operators each year for the benefit of their shareholders.
Amendment 23 raises the specific question of whether public ownership will expose the Government to pension liabilities that previously sat with private operators. Under the current national rail contracts, DfT funds the legitimate actual costs of the train operating companies. For example, this includes the net operational costs of running services and the cost of leasing rolling stock and pension contributions.
The noble Lord, Lord Young, asked a specific question on Monday about how the Office for National Statistics might classify publicly owned operators in future. I cannot, of course, answer that question, as future classification decisions are a matter for the independent ONS, not for me or my department. What I can do is to confirm the current classification of the DfT contracted operators, which are all currently classified as public non-financial corporations, including the four DOHL-owned operators. I can also confirm what has happened previously when a service is transferred from private to public ownership. For example, following the transfer of services into DOHL, the ONS recently considered the classification of TransPennine trains, and concluded that they should remain classified as a public non-financial corporation. That fact that these publicly owned operators are classified in this way, along with the privately owned operators, means that their costs already impact the public finances. For example—and this is particularly relevant to Amendment 25—both private and publicly owned operators’ rolling stock lease payments already come out of the department’s resource budget.
Turning to pensions, I cannot agree with those who assert that the franchising model left responsibility for funding pension liabilities entirely with the private sector. Even under the form of franchising that was in place before the pandemic, pension costs were to a substantial extent a long-term liability for the public sector. First, this is because the franchising system meant the bidder simply priced any changes in costs into their bids at reletting, changing the amount of subsidy payable to the operator or the premium receivable by Government. This meant that the burden of any increases in pension costs arising during the term of the contract would, at the point of retendering, be passed to the taxpayer. Secondly, in the more recent franchise competitions the department was required to share the risk of any adverse movements in pension deficit recovery payments, as that had become a risk that the private operators stated they were unable to bear. The Bill therefore does not materially change the Government’s level of exposure to liabilities.
On the noble Lord’s second amendment regarding pension liabilities, in previous transfers to DOHL the transferring staff have remained within their existing section of the Railways Pension Scheme at the point of transfer. Railways Pension Scheme contribution rates will not change when services transfer from private to public sector operation and, as mentioned a moment ago, the cost of employer pension contributions is already borne by the Government under the terms of the existing contracts.
The noble Lord may also find it helpful to know that the department already reports in its annual report and accounts the employer’s share of the net pension scheme surplus or deficit, the employer’s share of pension scheme assets and the employer’s share of pension scheme liabilities.
In response to the noble Baroness, Lady Randerson, transparency will be enhanced by public ownership. In respect of the question about the passenger standards authority, I am afraid it is too early to say what it will and will not do. That is why we are going to consult about its duties in order to make sure that it represents passengers’ interests in the best way possible.
In view of these observations, noting in particular that the costs of public sector operations are already in the public domain, I urge the noble Lord not to press these amendments.
Lord Moylan (Con)
My Lords, I may have expressed myself very poorly when I presented these amendments, but I think it is fair to say—I do not mean to sound overcritical—that the Minister has misconceived all of them, or at least the three that I spent some time on. So perhaps the House will indulge me if I simply run through once again the points that I was hoping to make but obviously have not done so very successfully.
I shall start with the remark about pensions. I was not asking the question, “Who funds the pension contributions?” That is an interesting question but one to which I already had the answer, so I did not feel that I needed to ask it. I was asking a specific question about where the balance sheet liability lies, which is a very different question. Are the accumulated liabilities, including unfunded liabilities, now going to score effectively as government debt—the whole package, not the payment year by year? It is the difference, if you like, between the balance sheet and the profit and loss. I have asked a question about balance sheet and the Minister has answered a question about profit and loss. I do not expect to get anything further out of him today but, once he has had a chance to reflect on my comments, he may want to write to me because it is a point that needs to be properly explored and indeed, I suspect, will be returned to in relation to leases when my noble friend Lord Young of Cookham takes the matter up later.
On the question of fares being charged, I take the Minister back to the pre-Covid period when the system under which we operate at the moment was functioning in the way that was expected—Covid of course destroyed and damaged the operation of that system. It is true that not all the fares but a large number of them were set by the Government, but the Government in that case had no interest whatsoever in allowing the train operating companies to make super profits or to exploit passengers who were effectively captive. It will be a different matter when the company operating the trains is a subsidiary of the Department for Transport, and any surplus—we must bear in mind that there are railway lines in this country that generate surpluses—will accrue to the department and therefore presumably to HM Treasury. I put it as a counterfactual question to the Minister: does he believe that, if passport issuance or visa issuance were in the hands of the private sector, the Home Office would allow the private sector to set such outrageously high fees and keep the profits? Of course it would not. The only reason why the Home Office can set such very high fees for a captive audience is that it can keep the profits, or at least they score against the expenditure of the Home Office. It has a financial interest in super returns, which is not true if the super returns are to be retained by the private sector, as was the case under the system that we are currently operating under when it was effectively running. So I do not think the Minister has quite grasped my point.
A similar question arises in relation to costs. He has explained—and I do not deny for a moment—that the department publishes information on what it pays to the train operating companies under its contracts. I am not asking: what do they pay? I am asking: is it efficiently spent? Once it becomes part of the department, there is no interest in demonstrating that efficiency has been achieved if political interests overwrite that. There will be no way of knowing with confidence whether efficiency is being achieved unless there is some sort of independent monitor.
It is possible that having reflected on my closing remarks the Minister wants to take these matters up in correspondence, or we can come back to them on Report. But I think his responses—and I blame myself for this—have failed to understand the points I was getting at. I thought they were reasonably clear but obviously I did not do a very good job. With that, and with the leave of the Committee, I would like to withdraw my amendment.
Lord Moylan
“30ZA Impact on open access operatorsThe Secretary of State must, within twelve months of the day on which the Passenger Railway Services (Public Ownership) Act 2024 comes into force, and annually thereafter, lay before Parliament a report on the impact of the awarding of public service contracts to public sector companies under subsection 30(1A) on open access operators in the United Kingdom.”
Lord Moylan (Con)
My Lords, earlier in Committee we had a debate on the value of open access and I am not proposing to repeat that. But now that the noble Lord has drawn my attention to the biblical text Getting Britain Moving—which I understand is now the Government’s plan for the railways in the country, the Williams review having been set to one side—I will draw attention to what that document has to say about open access.
It too is full of praise. It says:
“Open access has a proven track record in driving competition”—
competition in this context, at least when the Labour Party was thinking about it before the election, was seen as an attractive thing—
“and better passenger outcomes in countries whose services are run predominantly by public operators”.
We will have a service
“run predominantly by public operators”,
and the implication here is that:
“Open access has a proven track record in driving competition”
and has “better passenger outcomes”, so it must be a very good thing.
That is not the impression I get from the debate so far. I have the impression that there is a degree of resistance to open access on the part of the Government. Indeed, there is a qualification, even in this document, on that. It has to add “value and capacity” to the rail network. Who has to be persuaded that it adds value? Here the document says something that rather confuses me. It says:
“The ORR will continue to make approval decisions on open access applications”.
My understanding was that Great British Railways, not the Office of Rail and Road, was going to make decisions about who could run passenger rail services on the network. Clarity from the Minister on what the intention is in that regard would be very helpful.
If it is Great British Railways, we run into the problem that allowing this to happen will result in competition. The whole purpose of Great British Railways —like that of Lord Ashfield, to whom I referred earlier —is to eliminate what could be regarded as wasteful competition.
This contradiction that lies at the heart of the proposition causes me considerable concern. At the root of it is a rather technical question concerning what is referred to as abstraction. The assumption on the part of those who run the railways—and this has been true of the Department for Transport as well; it is not something new, but I have every reason to think it will continue—is that if somebody provides a railway service in competition with the Government, it is abstracting fares income that otherwise would accrue to the Government. So there is a cost to the Government or Great British Railways, depending on where we are in this process, in allowing open access to operate.
Baroness Randerson (LD)
My Lords, there are of course some excellent examples of open access operators and some very successful ones, but I am a bit sceptical. We have a Government who are so opposed to competition on the railways that even very good train operators, such as Greater Anglia, have to be removed as a priority. I am sceptical that the Government would be keen to encourage further open access operators. I think I drew attention to this in our debates on Monday. I feel it is illogical that the Government are putting an end to the train operators that have fully rounded franchises but will tolerate open access. Open access is, in reality, capitalism red in tooth and claw, in comparison with the role of train operating companies managing the franchises they have.
The Government here are set up as a judge and a jury over open access operators and whether more will be allowed. Can the Minister tell us how the judgment will be made on future open access operators, or tell us with total frankness that we have what we have and are unlikely to get any more?
Lord Hendy of Richmond Hill (Lab)
The Bill before the House is specifically about the ownership of services currently operated under contract to the Secretary of State, Scottish Ministers or Welsh Ministers. Transferring and retaining these services in public ownership will not affect open access operators or prevent them running as they do now. It is therefore not necessary, as in Amendment 24, to require the Government to lay a report on the impact of public ownership on open access operators, given that this Bill will not affect the rights of those operators to access the network and run services. I emphasise that as part of the wider railways Bill, any proposed changes to access arrangements and the body that decides them will, of course, be subject to consideration and debate by your Lordships’ House before they are implemented. I beg for some patience in this debate.
Turning to Amendment 27, which requires the ORR to produce an independent report on access, I again reassure the House that under the present public ownership Bill, the ORR will continue its role in relation to access decisions. There is therefore no need for this amendment; an independent function is already in place that will decide on access to ensure there is no disadvantage to non-publicly owned operators. We will set out further detail on GBR roles and responsibilities in the coming months. Given those reassurances and that this Bill does not affect the rights of open access operators to run services, I urge the noble Lord to withdraw the amendment.
Lord Moylan (Con)
My Lords, once again I am being deflected more than answered. I did not suggest that existing open access operators were going to be closed down. In fact, it says quite explicitly in the biblical document Getting Britain Moving that current
“independent operators (such as Hull Trains and Lumo) … will remain”.
I take it that the existing operators are guaranteed to remain, at least as far as the current terms of their arrangements are concerned.
I find it very worrying that the Minister cannot say whether his long-term vision includes allowing the ORR to make these decisions, or taking it, which I understood is very much the logic of his Bill, into Great British Railways. It simply is not enough to say that this can be deferred. Open access operators that might want to bid for new services—not the existing ones, I grant you—are now going to be entering a period with a very chilling effect, because they will not know whether open access is going to be welcomed in the future. They will not know, when the new Bill comes forward in 18 months’ time, whether they are going to be welcomed or turned away. That is a direct consequence of this Bill and not something that can simply be deferred on the grounds that it will all be wrapped up in 18 months or so.
I find it very unfortunate that the Minister cannot give a franker and more candid answer on the Government’s intentions at this stage. I fear that the effects for passengers of the measure in front of us are therefore going to be detrimental, even in the short term. With that, I beg leave to withdraw my amendment.
Lord Young of Cookham
“30D Annual report of public operator liabilities(1) The Secretary of State must lay before Parliament, within six months of the day on which the Passenger Railway Services (Public Ownership) Act 2024 is passed, and annually thereafter, a report on the public sector financial liabilities arising from the award of public service contracts to public sector companies under section 30(1A).(2) The report published under subsection (1) must include details of—(a) rolling stock leasing liabilities;(b) pension scheme liabilities;(c) property leasing liabilities;(d) other financial liabilities such as debt.” Member's explanatory statement
This amendment would require the Secretary of State to publish an annual report examining the impact of train company liabilities transferring onto the public sector balance sheet under nationalisation.
Lord Young of Cookham (Con)
My Lords, this is not a great time to address the rather arcane subject of what is and what is not public expenditure. But it is absolutely vital to the future of the railways, and this group of amendments is one of the most important in the whole Bill.
Any Government have limits on how much they can borrow, and we discovered two years ago what happens if a Government go through those limits. Within those limits, there is fierce competition between spending Ministers for access to borrowing to fund their projects. That process is probably going on as we speak, with competition between social housing, new hospitals and the rest.
Historically, as I said on Second Reading, transport fared very badly under that system when it was nationalised. Final decisions are made in a star chamber, or equivalent, and as I know from experience, transport gets squeezed. One advantage of privatisation was that a big chunk of investment was shifted off the government balance sheet on to the private sector, and as a result there was a huge increase in investment.
Railtrack was clearly in the private sector. When Network Rail was set up by the previous Labour Government, they were very anxious that it should be a private company and so kept off the PSBR. They devised a rather elaborate form of corporate governance. It was a company, but it had no shareholders. Instead, it had 114 members—some licence holders and some members of the public. That kept it off the books for a bit, but the Treasury was so worried about this that it told Labour Ministers at the time to stop criticising Network Rail bonuses in case the ONS should use that as an excuse to reclassify it. Eventually, reality caught up and Network Rail was reclassified, in 2014. It could no longer borrow what it needed to keep the projects going. My concern is that what happened to Network Rail is going to happen to GBR, and the Government are taking a gamble in setting it up.
When Network Rail was reclassified, it had to divest around £1.8 billion by selling property assets, including retail units and spare capacity on the telecoms network. It deferred renewals works and postponed completion dates. It had to renegotiate a whole lot of contracts. As a result, its underlying costs increased. The question is: how will GBR be classified? It will not have the pretence of a private company like Network Rail; this will be a nationalised industry. The Minister is unable to give any assurance that it will not be reclassified or classified as public sector, as he said in response to my noble friend on Amendment 19.
The Minister has argued that this will not make any difference because the TOCs do not spend capital. I recognise that that was the case during the pandemic and after it, but it certainly was not before. I will not repeat the example I gave earlier of Chiltern, which spent a substantial amount of private capital investing in the railway, including building new stations. The noble Lord, Lord Snape, endorsed that comment.
The Minister has also argued that, because the roscos remain in the private sector—this is an amendment the noble Lord, Lord Sikka, may speak to—the investment in new trains they made during the franchise system, by borrowing money privately and purchasing the rolling stock, will continue to flow. He told us during the first day of Committee, on Monday, that, whatever the position regarding the future nationalised industry,
“it must already apply to the four publicly owned train companies”.—[Official Report, 21/10/24; col. 506.]
He has used those four TOCs ordering new fleets as evidence to support his claim that ordering new trains will continue as before.
However, to compare the present accounting arrangements for TOCs that are now in-house, which the current law treats as being prepared to be returned to private sector competition, with the accounting arrangements that would exist for a permanent public monopoly—which GBR is—is to compare apples with oranges. The creation of GBR will create a completely new system, which will change the way in which the ONS categorises expenditure. Those different accounting treatments will make investment in rolling stock harder, as it will be in competition with other demands for public investment.
Lord Sikka (Lab)
My Lords, Amendment 44 requires the Secretary of State, within 12 months of enacting the Bill, to publish an annual report on the relationship between the provisions of the Bill and the leasing of rolling stock to public sector companies. My preference would have been to end the private ownership of rolling stock, but the Bill officer suggested that such an amendment was beyond the scope of the Bill—hence this silly weak amendment that I am putting forward.
The background is that, during Second Reading, on 7 October, the noble Baroness, Lady Blake of Leeds, laid down the principles of the Bill. She said:
“This Bill will ensure that trains are run for the benefit of the British public, not for the profits of shareholders around the world”.
She added that, by ending the current franchise system for passenger railways,
“the taxpayer will save between £110 million and £150 million a year in fees”.—[Official Report, 7/10/24; cols. 1831, 1833.]
The Government have already said that they will not bring rolling stock back into public ownership. However, the new system, operated by a public company, will still need rolling stock, and the Government have not provided a great deal of clarity on that so far. By leaving the rolling stock in private hands, they will be negating their own principle, which was to deny profits to shareholders around the world.
The Bill will not facilitate public ownership of passenger railway services. Instead, it will facilitate what I call “rent a carriage”. That will guarantee massive profits for rolling stock companies—roscos—which do not build or commission trains but make huge profits. Last year, roscos charged £3.1 billion for leasing out rolling stock and had a profit margin of 41.6%. That is a profit of £1.29 billion in one year, extracted from customers and the public purse. The actual amount which the shareholders have extracted from roscos is likely to be much, much bigger—more of that in a moment.
I looked at the accounts of one of the roscos and it is full of financial engineering. The £1.29 billion profit which it declared for a year is far greater than the savings for the passenger services that the Minister said would be £110 million to £150 million a year. There is no justification for the profiteering of roscos, especially as the payments are guaranteed and in future will be guaranteed by the state—at worst, it can simply print the money—so the risk is very low. The return should be no higher than the yield on any government bond, which is technically called a risk-free rate of return.
The actual returns extracted by rosco shareholders are much bigger than the dividends. Let me illustrate that with quotes from the accounts of Porterbrook, which is one of these companies. It is owned by foreign shareholders: Canadian pension fund manager Alberta Investment Management; Luxembourg-based Allianz Capital Partners; EDF Invest, which is owned by the French Government; and Australian infrastructure investor Hastings Funds Management. Porterbrook’s 2023 accounts show a payment in dividends of £150 million. In 2022, it was £285 million. That is £435 million in dividends in just two years, which is far greater than the expected total saving of £110 million to £150 million for the publicly operated passenger service.
The company also shifts profits through intra-group transactions. In 2023, it paid £154 million interest on its debt, which included £153.5 million to other entities in the same group—not to an outsider, but within the same group. In 2022, it made interest payments of £162.4 million, which included £161.2 million to other group entities. In the absence of additional information, it is hard to know whether such payments are genuine. They are probably not.
Of course, profits are also shifted to avoid taxes. Interest payments give the company a tax-deductible expense, even though the transactions are not arm’s length and may lack economic substance. This company paid no corporation tax in the last two years, dividends are paid to foreign investors, and they did not pay any UK tax on those. This really is organised looting, permitted by the last Government, and I urge the Minister to ask HMRC to investigate these companies. Over the last two years, Porterbrook extracted at least £750 million in returns for its shareholders, or an average of £375 million a year. This is far greater than the £110 million to £150 million which the Government hope to save by ending passenger rail franchises.
I have referred to only one company, which is by no means the largest one, but I am sure the Minister gets the substance of my arguments. Billions of pounds can be saved by ending the role of current roscos in the railway industry. Leasing out rolling stock is effectively a licence to print money. I understand from rail company executives that the useful economic life of a carriage is around 30 years or more. The cost of a carriage is normally recovered through rental or leasing arrangements over a period of five to seven years. This being so, the rental charges of 23 to 25 years are pure profit, nothing else. There is absolutely no economic justification for this. The Government can help by stopping the use of current roscos. They can buy direct from manufacturers or set up a Great British Railways leasing company. All of these options are preferable to the current practice.
I hope that, as a first step towards ending profiteering, the Minister will agree to publish the annual report that this amendment calls for. It should provide data about the returns extracted by shareholders in dividends, intragroup transactions, related-party transactions and various profit-shifting techniques. Of course, my preference is to end this roscos circus altogether.
Viscount Hanworth (Lab)
My Lords, I offer my support to Amendment 44 and, beyond that, want to support and reiterate what my colleague has just asserted.
I agree that, consequent upon the Bill, the whole of the rail system needs to be kept under review during the period of transition. The privatisation of British Rail imposed costs on rail users and taxpayers. There were costs that resulted from the disorganisation of the system which might have been alleviated by rational central planning. There were also costs that arose from the profit-seeking and rent-seeking of the agents of privatisation.
Some of the main train operating companies have been paying large dividends to their ultimate owners. These include consortia of foreign banks and foreign national rail companies, as we have heard. The companies that own the rolling stock and lease it to the train operating companies have been deriving large and exorbitant rents. These companies are of course called the roscos.
The three largest companies, Porterbrook, Eversholt Rail Group and Angel Trains, own 84% of the UK’s rolling stock. They were established in 1994, at the time of the privatisation. They acquired their rolling stock at vastly undervalued prices and substantial profits were reaped when they were sold on to subsequent owners. These companies have complicated structures of foreign and domestic ownership. Between 2012 and 2018, the three largest roscos passed on a total of £1.2 billion to their parent companies in the form of dividends. We have heard that this sum has recently become even more exorbitant. The Government appear to have concluded that it would be far too expensive to bring these companies into public ownership.
It should be observed that the era of the roscos has coincided with the demise of our railway manufacturing industry, the remnants of which have now fallen into the hands of foreign owners. This demise has been due, in part, to the activities of the rolling stock companies. Instead of providing a steady flow of orders for new rolling stock, they have often opted to refurbish their existing stock. This has made it unprofitable to manufacture trains in the UK. The train manufacturers are now in foreign hands, and they may decide to retreat abroad.
To avert this, there needs to be a consistent stream of rolling stock replacements, subject to a centrally managed plan. The question is how this can be achieved. Others may have opinions to offer on this matter, but I believe that, when Great British Railways is properly established, it should undertake this task. Great British Railways would not be remitting exorbitant dividends to financial consortia, such as the owners of the existing roscos do, and it would not be paying eye-watering salaries to its executive staff. As a consequence of such savings, it would be able to offer attractive rates of return to funds borrowed from capital markets, which might assist investment in new rolling stock.
Lord Gascoigne (Con)
My Lords, I rise briefly to support my noble friends Lord Young of Cookham and Lord Moylan on their Amendment 42, which calls for an annual statement setting out the liabilities to the public purse.
As I said on day one, the whole rail system is duplicated, messy and costly. Given that this Bill is piecemeal and without the other substantive and necessary reforms, it runs the risk of not fixing the problem but making it worse and costing the taxpayer even more. As has already been noted, in the Labour Party’s Getting Britain Moving document, there is a section titled “Failure is increasing costs”, which talks about the savings to be made. The Government’s September press release hails the Secretary of State as having
“fired the starting gun on rail reform”,
and clearly notes that it will be
“saving taxpayers up to an estimated £150 million every year in fees alone in the process”.
So we will bank that—well, the Treasury will, rather than the taxpayer—but the indication from that is that there will be savings of at least £150 million every year. I am not disputing that figure, but what other savings will there be?
I was reading the other day that nationalisation could be costing the taxpayer £1 billion per year by the end of this Parliament. There is an argument that it is only because of privatisation that we can see what the system costs and what is profitable and what is not. There is a legitimate concern that the cost will once again become opaque, with the passing of this Bill and when it starts to take effect. In assessing the virtue of these reforms, not just from an ideological point of view, the country should know what else it is taking on, not least because it will effectively be the owner or shareholder, not just of the railways but now the liabilities of the companies which will be transferred on to the Government’s balance sheet.
Baroness Randerson (LD)
My Lords, the amendment and the speech of the noble Lord, Lord Young, indicate the obvious advantages of nationalisation in terms of greater access to information and transparency; it has disadvantages, which the noble Lord set out, but it also has advantages. The speech by the noble Lord, Lord Sikka, was compelling: the evidence and information he gave us illustrated much better than I have heard before the issues that have been referred to—I referred to them on Second Reading and on Monday—regarding the imbalance between the attitude of the Government towards the speed of taking over the train operators and the fact that they are prepared to leave well alone the roscos, which can quite clearly be seen to be exploiting their situation and therefore getting excess profits as a result. I will be very interested to listen to the Minister’s explanation of why that is happening.
Lord Moylan (Con)
My Lords, at this hour I would like to expand considerably on my noble friend Lord Young of Cookham’s remarks on his amendment, but I find there is nothing I can add, given how well expressed his argument was technically. I shall say only that I hope the Minister, by contrast to his response to the previous group, will recognise the serious balance sheet issues that arise in relation to lease obligations. I understand that, while the department currently recognises its obligations to the end of the current contracts, most of which are a matter of months or very few years away, when the responsibility transfers to the Government, they will be responsible for the lease payments for the whole of the life of the remaining contracts for the lease of the trains and these will therefore represent a balance sheet liability, not simply an ongoing cost, that may well need to be recognised. I am not, as I say, as proficient in these matters as my noble friend, but I hope very much that the Minister treats that seriously and gives us a proper and robust answer about how this is to be treated.
I shall save the bulk of my remarks for the amendment moved by the noble Lord, Lord Sikka, with which, it may surprise noble Lords, I have a great deal more sympathy than they might expect, certainly as far as his analysis is concerned, though not necessarily with his solution of total nationalisation and so forth.
The fact is that there is a very large amount of capital in the world, and a capital is seeking a return. However, this capital is not buccaneering 19th-century capital of the sort that built the railways in the first place; this is not capital that is looking for investments at risk; and this is not capital that sees that it might win a large prize on one investment in its portfolio but is willing to tolerate the total loss of another investment in its portfolio. This is capital that is looking for risk-free returns—or returns that are close to being risk free—but at a rate of return that is considerably higher than it would achieve if it invested in government bonds.
Such capital is to be found throughout our economy—this is a criticism not of the current Government but of the previous Government and of the Labour Government as managed by Gordon Brown—because it is the basis on which funding is now provided to most of our utilities. That is why they all belong to large, foreign—although they are not necessarily foreign, and I do not object to the fact that they are foreign, so I will drop that word—investors who are looking for super returns and are achieving them because the Government are so accommodating towards them.
The noble Lord, Lord Sikka, asked why the Government do not do something about this and why they do not nationalise the roscos as well. That would be a true nationalisation. As I said at Second Reading, this Bill is not really a nationalisation of the railways; as I said in Committee on Monday, it is more like dismissing your chauffeur at the end of his contract. That is all that is really happening. If you are nationalising something, you normally have to pay for it and you normally acquire assets. That is not what is happening here, because the assets are all left in the private sector. The Bill’s headline claim of nationalising the railways—after all, that is the main purpose of this Bill: to get a headline out there quickly—is largely bogus. The main reason that the Government are not acquiring the roscos is that they cannot afford to do so.
There is a second reason that the Government are not acquiring the roscos or going even further—as I suspect the noble Lord, Lord Sikka, would—by seizing their super profits and acquiring them at a price that would reflect a reasonable rate of return closer to the risk-free rate of return for the rest of the period of their leases. That reason is that this Government, rather like the previous one, are wholly dependent on that source of funding for nearly every infrastructure project that they want to carry out, be it railways, environmental stuff, net zero and so forth.
In fact, there was a great conclave of these investors only a week or so ago, at which the Government told them what wonderful prospects they would have with their super, close-to-risk-free returns if only they would invest in Britain. It is not that we will get less of this sort of finance that is so objectionable to the noble Lord, Lord Sikka, under this Government; we will get a great deal more of it. That is the simple explanation, whatever the Government say, as to why they will not do what the noble Lord would like them to do, and which anybody who values true competitive capitalism would also consider to be moving towards terminating an outrage.
Lord Sikka (Lab)
My Lords, I do not want to reply to the noble Lord, Lord Moylan, because I would be here all night picking holes in every point he made in reference to me.
Perhaps I may help the Minister out. The noble Lord, Lord Young of Cookham, talked about the liabilities of Network Rail. The composition of government debt published by the ONS includes the liabilities of Network Rail, but the assets acquired with that debt are excluded. That means that the government debt is overstated. In a balance sheet, you will have assets and liabilities. In the ONS approach, only Network Rail’s liabilities are included in the debt. I understand that, for quite a long while, the Treasury has been looking at reconfiguring the composition of public debt, and I very much hope that, soon, it will do the proper thing by either taking off the debt altogether from the ONS numbers or including Network Rail’s assets as well.
Lord Hendy of Richmond Hill (Lab)
My Lords, I am grateful to all noble Lords who contributed to this discussion. First, I should say that the objective of this limited Bill before the Committee remains to unify track and train, to provide better services to passengers, to reduce the cost of the railway and to increase the railway’s income. The phrase I would use to start with is, “We are where we are”.
The noble Lord, Lord Young of Cookham, referred to Network Rail. I am very familiar with its arrangements post being put back on the Government’s balance sheet. All I can say to the noble Lord is that managing it is and has been a difficult job. However, it has still managed to make significant investment in the railway infrastructure of Great Britain. In some ways, its exposure to being in the public sector did it a great deal of good. I was paid significantly less to chair it than my predecessor was; its chief executive is paid significantly less than any of his predecessors and to my mind, he does a very good job. The organisation is a good deal more frugal than it used to be, yet it still does some very good things in operating the railway infrastructure.
The noble Lord, Lord Young of Cookham, knows that Chiltern was always an outlier. There was no other plausible large-scale investment in railway infrastructure by a train operating company; certainly, there has been no recent interest in it. If you looked at the owners of the train operating companies now, you would see that their balance sheets simply would not support it.
Of course, the noble Lord knows that I cannot predict what the Office for National Statistics will or will not say. Although the suggestion is that, after six years, LNER was still capable of being put back in the private sector, there was absolutely no evidence that it or Northern, which was in public ownership for four years, was being prepared at all. There was also no move in the previous Government’s department to do so. Nevertheless, there was no change in the status of the public accounts of those companies. The noble Lord may speculate that there might be in future, with these arrangements, but I could equally assert that experience suggests that there will not be.
My noble friend Lord Sikka made a further point about the treatment of the assets and liabilities of Network Rail. I will write to both him and the noble Lord, Lord Young of Cookham, about that.
On the other hand, I recognise completely the passion with which my noble friends Lord Sikka and Lord Hanworth spoke about the rolling stock companies. Again, we are where we are. I heard my noble friends’ arguments with interest, but the Government will not buy back the rolling stock companies. Great British Railways will enable a longer-term view of the rolling stock market and it will reduce the margins it needs to make. Everybody is right to say that rolling stock lasts for 30 to 35 years, but a railway that is more accurately able to predict how long that rolling stock should last and where it should be used will reduce the uncertainty of relatively short-term leases. It will also significantly reduce the cost of those leases and will actually enhance competition in the market. We will see how that market evolves over time.
Having said all that, I urge the noble Lord to withdraw his amendment.
Lord Young of Cookham (Con)
I am grateful to all noble Lords who have spoken in this debate. The noble Lord, Lord Sikka, said that the Treasury would like to redefine what is public expenditure and what is not. I am sure that is the case—it would like to get some liabilities off the balance sheet. The whole point of having an independent ONS is so that the Treasury, led by politicians, cannot adjust the figures and the liabilities to suit its convenience.
What has not come out in this debate is that there is competition between the roscos to supply the wants of the train operating companies. Originally, there were three, now there are four, and there have been two recent entrants. The competition between them has driven down the costs. The Government, who on Monday spent time trying to persuade foreign investors to invest in infrastructure, will have been a little disappointed to hear the noble Lord, Lord Sikka, being less than complimentary about the investments that they have made in some important parts of the infrastructure.
Lord Sikka
“30D Review of relationship between provisions of section 30(1A) and the leasing of rolling stockThe Secretary of State must, within twelve months of the day on which the Passenger Railway Services (Public Ownership) Act 2024 comes into force, lay before Parliament a report on the relationship between public sector contracts awarded under section 30(1A) and the leasing of rolling stock to public sector companies.” Member's explanatory statement
This amendment would require the Secretary of State to publish an annual report on the relationship between the provisions of the Bill and the leasing of rolling stock to public sector companies.
Lord Sikka (Lab)
I am very grateful to the Minister and all the other noble Lords who have participated in tonight’s debate. Let me make it clear that my proposal would not stymie competition among manufacturers. It seeks to eliminate the financial intermediaries that are making 41.6% profit on top of whatever the manufacturers are paid. These roscos do not make trains and they do not test them; they are there simply to make extra profits. Competition among manufacturers will remain.
The Minister has said that the Government do not wish to buy back rolling stock companies. I am not asking the Government to buy back rolling stock companies. I am suggesting setting up a Great British Railways leasing company, so that these intermediaries can be eliminated. That would wipe them out, and my estimate is that it would save probably around £2 billion a year. I refer only to one company, which had taken out £750 million over a two-year period. It would be beneficial to set up a Great British Railways leasing company. However, I hear the Minister’s arguments and will reflect upon them. For the time being, I will not move the amendment.
Lord Kennedy of Southwark (Lab Co-op)
It is now 10.18 pm. I am unable to get agreement from the usual channels to finish the last amendment, which is a bit disappointing. If I cannot get agreement then we will have to adjourn. In all my years as Opposition Chief Whip, I have never been in a situation where one amendment cannot be finished off.
Lord Moylan (Con)
My Lords, I understand that there has been agreement with the usual channels. I do not think that the matter is in my hands.
Lord Kennedy of Southwark (Lab Co-op)
In this situation, the House will resume. It is very disappointing. Never in my time as Opposition Chief Whip would I have acted like that.
Passenger Railway Services (Public Ownership) Bill
Tuesday 29th October 2024
(3 weeks, 2 days ago)
Lords ChamberRead Full debate Passenger Railway Services (Public Ownership) Bill 2024-26 Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: HL Bill 21-III Third marshalled list for Committee - (25 Oct 2024)
Lord Moylan
“30D Management of rail services in Greater London(1) The Secretary of State must make a statement in each House of Parliament on the impact of shared responsibility between Transport for London and public sector companies awarded a contract under section 30(1A) under the management of Shadow Great British Railways, for the provision of railway passenger services in the Greater London area within three months of the day on which the Passenger Railway Services (Public Ownership) Act 2024 is passed.(2) The statement made under subsection (1) must include an assessment of how the provision of any services procured by Transport for London under section 30(1A) can be managed in a manner that is consistent with the remit of Shadow Great British Railways.”Member’s explanatory statement
This amendment requires the Secretary of State to make a statement assessing the impact of shared responsibility for railway passenger services in Greater London following the changes in the Bill.
Lord Moylan (Con)
My Lords, a great deal was said earlier in Committee about the achievements of Transport for London in improving passenger rail services in London, predominantly through the London Overground system. It would be wrong and unnecessary for me to repeat that; any noble Lord who wishes to see it summarised can read the excellent speech from the noble Baroness, Lady Pidgeon, who explained it all extremely well.
When it comes to London, the Bill has a huge lacuna at its heart: the mayor. The office of the mayoralty was established by referendum, and it is not to be treated with contempt. I may surprise noble Lords by saying that I had an increasing regard for the first mayor, Ken Livingstone, who defeated his Labour opponent to become mayor in 2000. We bonded over our joint opposition, on which we worked together, to Gordon Brown’s disastrous PPP for London Underground. That brought us together, and he always treated me with great courtesy and kindness. He started London Overground, and it was his success in winning the Olympic bid that secured for Transport for London a huge amount of investment in the capital’s transport, which was transformative.
How do this Government treat his successor? On 9 July, immediately after meeting the Prime Minister and other Ministers in the immediate wake of the election, the mayor said:
“What’s clear from listening to Angela Rayner and Keir Starmer today is they are really keen to devolve more powers not just to London but to other parts of the country. You will be hearing in the course of the next few weeks and months examples of those additional powers”.
Well, here we are, a few weeks and months later, and what do we hear? But he said something else on 9 July:
“One of the things that was confirmed from the meeting this morning is once those franchises end and are brought into”
the Department for Transport,
“they will be talking to mayors like me about which of those railways we can take over. I’ll be lobbying for once those franchises end, those commuter trains that come into London for us to have that”.
That was the position of the mayor and, as far as I know, it remains unchanged.
But the truth must have dawned on him when he read—if he has by now read—the letter sent very courteously by the Minister on 18 October to noble Lords who spoke at Second Reading, in which he said in unequivocal terms:
“The Government has no current plan to devolve responsibility for operating further national railway services to local authorities”.
I take it—of course, he could contradict me on this—from that and from the tone of the debate earlier in Committee that he includes London and the mayoralty among those local authorities.
So, what is he actually offering? The Mayor of London will have the ability to agree national and regional services with Great British Railways, to be run by Great British Railways, and earlier in Committee, the Minister gave an example of how that might work. Again, I am not reading this from Hansard, but I think my recollection is correct. He told us that he was already in discussions with the Mayor of Greater Manchester about how the mayor could purchase services, I presume from Network Rail at this stage—as we know, Great British Railways does not exist as a legal entity, nor does shadow Great British Railways have any legal substance—which could even be branded with the Bee Network logo, which is the characteristic mark of local transport services in Manchester and of the buses operated by the mayor.
It is worth dwelling on this for a moment. I think I can say—it is very much up to the Minister to correct me—that, had this been put to the Minister when he was commissioner of Transport for London, he would have rejected it out of hand. The Transport for London brand is of huge value, and it goes to the reputation of Transport for London in a very intimate and direct way. There is no way that he, or I think the mayors he served under, would have accepted that services operated by a different operator altogether could have been travelling with the TfL brand on them, over which he had minimal control. Some noble Lords may say, “But doesn’t that happen already? He has private companies operating services in London with the TfL brand on them”. But they are of course operated on a concession basis, and they are very tightly controlled by Transport for London. Transport for London remains in control of its own brand. It is a question of the power relationship.
But what is the power relationship going to be between the Mayor of Greater Manchester and Great British Railways if the services it offers are branded with the Bee Network—which, I admit, does not yet have the global brand recognition that TfL, with its logo, its merchandising, its map and so forth, has? None the less, the Bee Network is an important brand for the people of Greater Manchester. What power is the mayor going to have if those services are operated in a way that is shoddy or objectionable or fails in some way? I will not speculate on the way, because we can all imagine it, whether it is timeliness, frequency, reliability, cleanliness or any of the other standards that have a direct and immediate impact on passengers. Of course, he will have no power at all, partly because he has nowhere else to go. He is simply a mayor, while this is Network Rail. It is huge and he is relatively small.
Baroness Pidgeon (LD)
My Lords, as I said last week when we debated a group of amendments about devolution of the railway, this is an issue that is dear to the heart of the Liberal Democrat Benches. We like nothing more than debating subsidiarity: what level is the most appropriate for different services and different decisions. I was not sure why it was felt that Amendment 47 was so significant that it needed to be debated separately rather than as part of the wider debate on devolution. I am still not 100% clear following the contribution of the noble Lord, Lord Moylan.
Understanding how the public ownership of the railway will fit alongside London’s concessions for the overground, the Elizabeth line and Merseyrail, is something that I hope the Government can expand on as they develop their planning around Great British Railways. It is not ideal having this legislation in isolation from the larger Bill which we expect next year. I hope that the Minister can offer some warmer words today about future devolution, not just the limited existing devolved lines. We absolutely believe that our devolved institutions need to be able to run services in a way that serves the needs of local areas and local communities and integrates them with other public transport, rather than Whitehall taking back control. In London, devolution has enabled joined-up thinking on not only wider transport strategies but housing and economic regeneration, alongside an additional level of accountability and increased responsiveness. As we have already heard, Manchester is on the brink of its own equivalent to the overground, expanding its Bee Network to cover rail services.
I hope that the Minister can assure the House that devolution is part of the future of rail in this country and that this legislation will enhance the current situation rather than detract from it.
Lord Berkeley (Lab)
My Lords, I want to add a few words to the speeches of the noble Lord, Lord Moylan, and the noble Baroness. I, too, get confused about what the Government’s long-term objective might be for devolution. There was an attempt a few years ago —I cannot remember whether the noble Lord, Lord Moylan, was in charge of the railways then, or London—to extend the network down to the south or south-east somewhere, and the Department for Transport opposed it for very many reasons that were probably quite good. All these issues will need discussing when we start talking about Manchester, Leeds, Liverpool, Birmingham and other big places.
I hope my noble friend can give some idea of who will be in charge of setting the fares; who will be in charge of running the timetable; what the access charges might be for the trains on the track—assuming that GBR will still be running the track; who controls it, and who can get decisions changed if they do not like it. In other words, who is in charge? It is very difficult to have a debate without knowing some of these basic facts. Whether it is a concession, or a franchise, or run by GBR, I hope that my noble friend can give us some further thoughts on where he thinks this is all going. If he cannot do so tonight, when will we hear a bit more so we can have a proper debate about the regional element with, I hope, lots of consultation?
Baroness O'Neill of Bexley (Con)
My Lords, I rise in support of the amendment tabled by my noble friend Lord Moylan, in seeking some clarity and assurances about transport in London, as a result of the Government’s plans to renationalise our railways. Before doing so, I will remind your Lordships’ that I am the Leader of the London Borough of Bexley, which is an outer London borough, so many of my experiences are driven by that.
It would be helpful if the Government could set out the intended relationship between them and the Mayor of London and Transport for London, should the renationalisation go ahead. Will the mayor and TfL’s powers be impacted and, if not, who will advocate for those in outer London or, indeed, outside London? The recent introduction of the Superloop showed how the Mayor of London and TfL do not understand the needs of outer London, especially in places like Bexley, Bromley and Sutton where there is no Underground infrastructure. The original TfL proposal was to take the Superloop to Bexleyheath station, where it would have been difficult to turn around, instead of taking it to Abbey Wood, where the recently completed Elizabeth line is now operational.
Your Lordships will know that Sir John Armitt of the National Infrastructure Commission will tell you the value of linking up transport options—that is what we sought to do. Fortunately, TfL did agree to our suggestion, and there is now a cross-borough connection linking the main transport hubs—that is, apart from Bexley Village, where that discussion continues. The lack of any Underground stations—something that the first Mayor of London tried to find in Bexley—also means a dependency on cars, especially with a high percentage of elderly residents. The mayor’s introduction of ULEZ charges, as well as the threat of road user charging, is therefore very unpopular and, again, shows a lack of understanding. This introduction also impacted those who live outside the London borders so, if the mayor and TfL have greater powers over the train infrastructure, who will advocate for those who live outside London but use services in London?
I recall being a commuter in the days of nationalised train services. It was great fun jumping off the trains before they reached the platforms. While you can argue that technology and change would have brought about some of the improvements that we see nowadays, there is no guarantee that Governments of all colours would have invested the money to make those changes.
There is a lot to be said for holding to account through contracts and performance reviews. As we know, investment in transport can bring about housing delivery. That has definitely been the situation in Abbey Wood post the Elizabeth line, which is why we want the original business case to take the Elizabeth line to Ebbsfleet to be completed. We know that it will bring about regeneration in Bexley and elsewhere, and bring about some of that housing delivery that London desperately needs.
Another case of opportunity missed is the Docklands Light Railway. The Mayor of London and TfL are proposing to extend the DLR across the Thames to Thamesmead town, which is a dead end. Our suggestion is that, if it were extended to Belvedere, it would not only link to Southeastern trains but, with a quick change, to both the Elizabeth line and Thameslink services—coming back to Sir John Armitt’s point. We know that the Government will need to invest, but who will determine that priority?
In addition to future planning of services, there is also the question of accessibility. If the proposals go ahead, who will determine when we get step-free access at Erith, Falconwood and Albany Park stations?
I am afraid that I have posed more questions than answers, but they are legitimate questions that need to be answered if the residents are to be protected from the Mayor of London. I support my noble friend Lord Moylan’s amendment.
Lord Gascoigne (Con)
My Lords, I support my noble friend Lord Moylan’s Amendment 47, which addresses the interaction between Transport for London and public sector companies. There are three points I wish to make.
First, if, in future—as the Minister knows all too well, having sat in on these conversations—the Mayor of London wished to build an entirely new part of the network and go for, let us say, Crossrail 2, what would be the Government’s position on that? Would they allow London to retain its independence and choose between public and private or insist, not least because projects require significant government funding, that the Bill takes effect across all new infrastructure and future services in London?
Secondly, and linked to that—as again the Minister knows all too well—infrastructure in London requires the private sector to play its part and contribute at least to help unlock wider renewal and regeneration. I referred to Crossrail, of which, from memory, London businesses paid about 40%. Has there been an analysis of the Bill’s impact on the ability to raise funds from business? I imagine that the Minister will say that that is a matter for the mayor, but there surely must be wider read-through from the Bill to the country far beyond London.
Thirdly, I wish to seek clarity from a policy point of view. My noble friend’s amendment exposes a real problem with the entire premise of the legislation. After all, it does not merely address what the relationship will be between one entity inside London and another that falls outside, which takes precedence. In the main, the amendment demonstrates why London is an anomaly that undermines the coherence of the Bill and the credibility of the whole policy. Ultimately, we are having the debate on this group because London is exempt from nationalisation.
As we heard repeatedly in Committee, part of the agenda for reform is to try to bring all the transport network together and make it less fragmented, yet London is exempted from this for whatever reasons. I make this point because, with this Bill, we are enacting a two-tier system. Choice is gone, and we are strengthening or at least reinforcing fragmentation. I can almost sense the response from the Benches opposite. It will be, as we heard before, that their manifesto talked about this, but it talked about public ownership, not the retention of freedom of choice in London.
Next we heard—not today, sadly—that public opinion polls said that people want nationalisation. When we heard this the other day, the only thing that struck me in my mind was this: are we really governed by public opinion? The other day—it might have been yesterday—there was a poll in which, I am afraid, our illustrious Prime Minister had fallen behind and was now more unpopular than Rishi Sunak. Does Labour, as it believes in public opinion, now believe that Rishi should be the Prime Minister?
Next is that the capital is so important, and that is indeed correct, but Liverpool is granted these freedoms too. Next it will be that I want to level down the capital —not at all.
Lord Grayling (Con)
My Lords, I rise briefly to support my noble friend’s amendment but perhaps from a slightly different perspective to his, given his—and indeed the Minister’s—track record, which had a strong focus on London. I believe it is very important to ensure that there is a clear explanation and, frankly, that there are detailed rules about how the interaction takes place around the London boundary, simply because there is a democratic issue here as well.
The noble Lord, Lord Berkeley, made reference to the attempt by the mayor to take control of the Southeastern franchise some years ago. I blocked that, for two reasons. First, there was a significant level of opposition outside London to that transition taking place—the sense that the mayor should not be running services that cross into Kent, Surrey and so forth—including strong opposition from local MPs. Secondly, there is the issue of fragmentation: who operates which depot, how do you divide the franchise in half and so forth? It is important to maintain a system that is simple and as easy to run as possible.
None the less, there is and will always be an issue around how the mayoral responsibility for services that cross the boundary interacts with services operating under the control of shadow Great British Railways and subsequently Great British Railways, how they interact and work together, and how the whole system is managed. While I do not support my noble friend’s level of enthusiasm for devolution because I worry about fragmentation, it is none the less important in this new world to have very clear guidance, rules and methodology about how the system in London will operate with the system that crosses paths with it around the London boundary and, indeed, into the termini in London.
I think my noble friend has put forward an important point here. Although we have a slightly different perspective on this, I very much hope that the Government will adopt this proposal, because I think it is the right one.
The Minister of State, Department for Transport (Lord Hendy of Richmond Hill) (Lab)
My Lords, I start by reminding the Committee that this is a short Bill, simply to bring back the national railway operations into public ownership. This is a popular policy with the public, absolutely necessary to making the railway run properly, and a necessary precursor to a more major Bill next year.
I thank the noble Lord, Lord Moylan, for this amendment, which would require not a report this time—although he has sought to require many—but Statements to Parliament about the relationship between services in Greater London provided under contract to TfL and those for which the Secretary of State is responsible.
There is no reason to expect the Bill, which allows train operations to transfer from private operators into public ownership, to have any adverse effect whatever on the existing collaboration between operators and TfL. The Bill makes no change to the existing duties on the Secretary of State for Transport and on Transport for London under Section 175 of the Greater London Authority Act 1999 to co-operate and co-ordinate passenger rail services in London. Like many noble Lords in the Committee, I know from my own experience how that works. I think we can all conclude that it has worked very satisfactorily so far and there is no reason why it should not continue.
The Bill will not have any adverse effect on those services: substantially the same staff will be running those trains under public ownership on the national railway network, as they do now, so there should be no concern about a sudden deterioration of service. In fact, I expect it to improve: publicly owned operators will prioritise the interests of passengers, rather than exploiting contractual conditions in pursuit of short-term profit.
The Bill says nothing about the devolution of further passenger rail service to the Mayor of London. It would not prevent further devolution, and nothing I have said would prevent that. If they were devolved, they could be operated in the same way as the current London Overground services are operated, under a concession from Transport for London.
When I said, as the noble Lord, Lord Moylan, quoted, that there is no current plan for further devolution, that was an accurate statement. Of course, it may not be an accurate statement in the future, but when I wrote the letter to him and other noble Lords and Baronesses, it was true. We will see what happens. It is only a few weeks since what the mayor said in July and, if he does have aspirations to operate further services, I am sure there will be a cordial discussion under the auspices of Section 175 to discuss whether and how that is carried out and the costs of doing it.
The noble Lord is also mistaken on Manchester. Certainly, the evolving situation I described with the Mayor of Manchester and Transport for Greater Manchester is that services would be operated not by Network Rail, because that is currently an infrastructure provider, but by a train company. In fact, it is most likely to be Northern Trains, which is already owned by the public sector and has been for four years.
As I have already said, I give a commitment that the future, wider Bill will give a statutory role for combined authority mayors that is better than any they have now. I have just repeated it for the avoidance of doubt. In that case, it is under Section 24 of the 1993 Act. If they were to want to operate train services, this Bill does not alter Section 24 and that would be a discussion that could be had. I described the situation as I understand it currently unfolding; in fact, they do not wish to do that, but the Secretary of State could devolve more under Section 24 if she chose to.
At the moment, if I have counted correctly, the operation of rail services in London is currently the responsibility of eight different franchised operators, plus two more under contract to Transport for London. That is without the long-distance operators whose services start and finish in London but do not otherwise serve the London market directly and, indeed, Network Rail, which is responsible for the physical railway infra- structure. Public ownership and subsequent integration into Great British Railways will simplify all this by bringing the currently franchised services together in ownership in one place. If TfL wishes to discuss or influence the provision of other rail services across Greater London in the future, it will have an easier job of engaging with Great British Railways. It will be assured that the train operators that are performing will be interested in acting in the interests of passengers.
The noble Lord, Lord Berkeley, asked where I think it is all going. I will come back and answer that on Report.
It was a pleasure to hear the noble Baroness, Lady O’Neill, talking about the particular circumstances of Bexley, and it is nice to see her in her place. I do not envisage any immediate change to the railway geography of south-east London. I cannot answer for much of the rest of what she said in the way that I once could, as the commissioner of Transport for London, but I am sure that she knows where to go to make the points about the Superloop, ULEZ and the other things she referred to for the benefit of her borough of Bexley.
The noble Lord, Lord Gascoigne, referred to Crossrail 2. It should be evident—I hope it is from what I have now said about Section 175—that, were Crossrail 2 to be promoted and come into effect, it would, like Crossrail 1, be complex, but the outcome would be a significant transfer of services to the mayor, because it would, and hopefully will, eventually take over some national railway services. The ease with which Crossrail has taken over former national railway services in London and transformed them into a coherent service for the benefit not only of London but the national economy would be replicated in Crossrail 2. Nothing in the Bill would change that; nor would it change the way that Crossrail was funded had it been proposed now, or the way Crossrail 2 would be funded if it were proposed in the future.
The answer to a lot of what has been said about the Overground is that the Bill primarily seeks to remedy those parts of the railway network that patently do not work well. I would contend—I have always contended in all my roles and in this one too—that the railway service in London works. It works because it is coherent, and there is no reason for the Bill to interfere with it.
I was very interested to hear from the noble Lord, Lord Grayling. I remember well his position on the devolution of Southeastern services, and he is right that many of them go well beyond the London boundary. There is a democratic issue about how well they serve the areas outside the boundary, and his recollection is correct that at the stage at which it was proposed— I recall it well because I proposed it, even if it was politically advocated by the mayor—it cost more to operate those services separately than it did together. That would be quite a good reason to think carefully about whether a proposition could now be made to do it differently. In a sense, he is making my case because one of the things that we need to have some regard to in a post-Covid railway, with less revenue but similar costs, is the cost of the whole thing. One of the reasons for the proposition in the Bill is to start to sort out the costs of the railway, increase its revenue and improve its performance.
I listened carefully to the remarks made by the noble Baroness, Lady Pidgeon, on devolution and I intend to come back to them on Report.
The Government’s plans will improve co-operation, not hinder it, so I see no need for the statement envisaged in the amendment of the noble Lord, Lord Moylan. I am sure that all involved will work together to ensure that publicly owned and TfL services can co-exist effectively side by side. On that basis, I urge the noble Lord to withdraw his amendment.
Lord Moylan (Con)
My Lords, I will briefly deal with two points. In answer to the very reasonable question from the noble Baroness, Lady Pidgeon, the reason for a separate London debate is the three different cases that currently exist for the devolution of rail services. One is London, where services are in large measure devolved—not all of them but there is a large measure of devolution that exists. The second is the other large conurbations where devolution of rail services does not exist—Birmingham, Manchester and so forth, with the exception of Liverpool, which we agreed earlier in Committee was a slightly separate case. The third is the local authorities that are too small to have much credibility as operating services on the national rail network, although there might be specific cases. It seemed to me that, even though it was mentioned at the time, London deserved a distinct debate because it is different from the other cases that we debated.
Turning to the Minister’s response, I think we have had some instances of documents that have rewritten themselves during the course of Committee. The latest is the letter which it turns out we had all misinterpreted because the weasel word “current” had not been given sufficient prominence, but which in fact means that there may well be devolution of the operation of rail services to London and elsewhere. That is not quite what it meant when everyone first read it, but there we are. I suppose the Minister will feel he has got away with that.
But what has he got away with when he offers a statutory role? We have a notion of what is meant by statutory role when we turn to the Labour Party document Getting Britain Moving, which says:
“there must also be a statutory role for devolved leaders in governing, managing, planning and developing the rail network”.
Eloquent by its silence is the word “operating”—it is not on offer. Whatever the Minister says may or may currently be the case, and whatever provisions of existing legislation he refers to, it is not going to happen. It is inconsistent with his argument for a single brain, it is not mentioned in the Labour Party policy document as it could have been, and there is not going to be meaningful devolution unless there is a change to the legislation. This may be a very short Bill, as the Minister says, but it is heavily pregnant with possibilities for the future.
With that, I beg leave to withdraw my amendment.
Passenger Railway Services (Public Ownership) Bill
Wednesday 6th November 2024
(2 weeks, 1 day ago)
Lords ChamberRead Full debate Passenger Railway Services (Public Ownership) Bill 2024-26 Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: HL Bill 21-R-I Marshalled list for Report - (4 Nov 2024)
12:50 - Division on Amendment 1 - Ayes: 187 / Noes: 132 - Amendment 1 agreed.
13:23 - Division on Amendment 2 - Ayes: 142 / Noes: 128 - Amendment 2 agreed.
14:37 - Division on Amendment 5 - Ayes: 99 / Noes: 138 - Amendment 5 disagreed.
15:58 - Division on Amendment 13 - Ayes: 69 / Noes: 124 - Amendment 13 disagreed.
Lord Gascoigne
“Purpose: improvement of passenger railway services(1) The purpose of this Act is to improve the performance of passenger railway services in the United Kingdom.(2) The Secretary of State must, in taking any actions under the provisions of this Act, have regard to this purpose.”Member’s explanatory statement
This amendment would place a duty on the Secretary of State to have regard to the purpose of the Act, namely the improved performance of passenger railway services in the United Kingdom.
Lord Gascoigne (Con)
My Lords, I rise briefly to fire the starting gun on Report with my Amendment 1. In doing so, I express my gratitude to my noble friend Lord Moylan for his support with this amendment. I also thank the Minister for taking the time to meet me the other day. I very much appreciated the opportunity he took to address my many questions in his usual cordial way.
This amendment today flows from my first amendment in Committee. Everyone wants the trains to improve. That is a given. As I said in Committee, and when I met the Minister recently, the reason I care about this is that we need the whole rail reform package and we need it not to be piecemeal. Personally, I would like to go down the route proposed under the Williams-Shapps review, but I recognise that that ship has probably sailed. That said, the overall goal is the same: to make it more efficient; to make it easier to travel; to make it more punctual and, ultimately, to improve the passenger service.
In Committee I used the word “Ronseal”: making sure that the Bill delivers what it is intended to, so that it does, in effect, what is on the tin. While I will not repeat word for word what I said, there are three technical points I want to address following on from Committee, for the benefit of the House today.
First, is this Tory language being inserted really a sort of Trojan horse, ready to pounce on the unsuspecting Minister in the Labour Government once they have welcomed it? No. In Getting Britain Moving: Labour’s Plan to Fix Britain’s Railways, published during the campaign, the then Shadow Secretary of State said in the foreword:
“We need a modern rail system—with improved services for passengers and better value for money for taxpayers—to serve as the backbone of a modern Britain”.
Later, she said:
“Labour’s challenge is to put our rail system back on track to sustainable growth and improvement”.
This was followed by:
“Labour’s vision is to deliver a unified and simplified rail system that relentlessly focuses on securing improved services for passengers and better value for money for taxpayers”.
Indeed, in just the foreword alone, there are eight references to either “improve”, “improving” or “improved services”, not to mention countless others in the rest of the document.
The Government and Labour may argue that those references are about the whole suite of rail reform: it is only then that you will get a better service after everything has changed. However, after the election, at Second Reading, in response to questions, the Transport Minister in the Commons said:
“Let me begin by dealing with the issue of public ownership. According to the shadow Secretary of State ... we have no proof that it will improve outcomes for passengers, but that is clearly not the case. We know for a fact that this Bill will save tens of millions of pounds in fees, and if that is not a good start, I do not know what is”.
A little later he went on to say:
“I am confident that public ownership will provide the right foundations to drive forward improvements for passengers”.—[Official Report, Commons, 29/7/24; col. 1135.]
I could read out plenty of other quotes which all use the same terminology and the same rationale for this Bill, but, as I hope noble Lords can see, this is not about me inserting language into this debate: it is already there from the Labour Party, both in opposition and in government.
Secondly, are we not overlapping existing commitments? My noble friend made the inspired observation in Committee that similar references are made in the Railways Act 1993. He is, as ever, correct that the obligation to improve services is used elsewhere and is not altered by this Bill, so why cannot it, or a reference to upholding that element of the 1993 Act, be put in this Bill?
Thirdly, from a technical point of view, do we need a purpose clause given that this Bill is focused on how nationalisation will take effect? I have said before that some will question whether a purpose clause is needed, given that this is a tightly focused Bill. I will suggest later why it is needed in general terms, but, from a purely technical point of view, in Clause 2 the Secretary of State will have to take a view and make a judgment of the virtue or otherwise of a franchise when deciding whether temporarily to extend the said franchise. By inserting this purpose clause at the outset, it is a necessary barometer setting out exactly what this Bill is seeking to do and what should be the Secretary of State’s overriding concern when making a decision.
This is not about stopping the Bill, nor is it about inserting assessments, reports or tests before anything can happen. There is no bureaucracy being created here, I am pleased to say to my friend the noble Lord, Lord Snape. It would not be costly—indeed, it would not cost anything—and I am not saying that it would lead to cheaper fares, although that is what people want to see and expect. It would not add anything onerous or new. As I said, this is language used elsewhere in legislation. It does not issue specific demands or expectations about cleanliness, the number of guards, ensuring decent toilets—or toilets that are open, which they absolutely should be. My amendment could talk about access and address some of the shocking things we heard in Committee about the experience of disabled people when travelling, which I know will come up later. But it merely sets out what the goal of reform is, to ensure that everyone from top to bottom knows what the Government are doing this for. We wish them to succeed in improving the service. It is language that Labour has used, and which is used elsewhere in legislation, to make it clear what the Bill will deliver. I beg to move.
Lord Lansley (Con)
My Lords, I support my noble friend on his Amendment 1 and will speak to Amendment 14 in my name. My noble friend very kindly referred to our debate on the same amendment in Committee. I note the reference in the Railways Act 1993 and that I see two merits in my noble friend’s amendment.
First, it is always a good thing for Bills to be clear about their purpose. Unless I am mistaking something, this amendment accurately reflects the Government’s purpose in this legislation. We may debate whether it will be successful or otherwise, but the purpose seems to be straightforward, and to have that in legislation is always helpful.
Secondly, because this Bill is essentially about amending parts of the Railways Act 1993 and nothing else, it is clearly subsidiary to the existing provisions of that Act, as amended. There are 10 general duties in that Act. The first is in Section 4(1)(zb),
“to promote improvements in railway service performance”.
My noble friend has accurately reflected the first of those 10 general duties, one of which we will come to debate in a subsequent group in relation to my amendment.
It seems to me that one of the abiding issues for public agencies, often including government departments, is the multiplicity of duties that are imposed upon them and the risk of conflict between those duties. Here, for these purposes, that would be clarified if it were made very clear that this important change to the way in which the provisions of the Railways Act are structured and to be used is to improve railway service performance. To raise that general duty in importance above the others would be helpful in clarifying the balance which the Government and the other agencies should take. I support Amendment 1 for that reason.
Amendment 14 refers to the new subsection of Section 30 of the Railways Act, inserted by the Bill, which provides that the provision of railway services can be made only via
“a direct award of a public service contract to a public sector company in accordance with regulation 17 … of the 2023 Regulations”.
Noble Lords will be aware of those regulations. Subsequently, the requirement for pre-award publication is disapplied by this legislation. However, paragraph (2) of Regulation 17 states:
“Where a competent authority makes a direct award of a public service contract under this regulation, the competent authority must, within one year of granting the award, and while ensuring the protection of commercially sensitive information and commercial interests, publish a notice on its website”.
The information required about the contract and the contractor is then listed in the regulation. Is one year right? Is it desirable that we should, in any circumstances, wait so long to be given information about the direct award of these contracts, given that they are instrumental to an understanding of whose responsibility it is to provide passenger railway services?
I have discussed my amendments with the Minister, and I am grateful for his time and that of his officials. I hope he has had a chance to think about my amendment and that, if he will not accept it, he will at least be able to tell us that it will be the Government’s intention to make new regulations quite soon, and in those new regulations to reduce to as little as three months after the granting of an award of a contract of this kind the publication of the notice and details. To assist later consideration, I say that it is certainly not my intention to press Amendment 14 when it is reached.
Lord Berkeley (Lab)
My Lords, I will speak briefly to my Amendment 16, which is in this group. I am, as ever, grateful to my noble friend for sparing the time to talk about this. My amendment is designed to be helpful. It is designed from experience of previous railway legislation, in which we got bogged down in massive detail, with hundreds of amendments; we may get somewhere, but it takes longer.
Given the discussion that we had on a large number of subjects in Committee, and will probably have today on Report, I thought it would be useful to probe the Minister’s view of how long it will be before what I call the definitive Bill is published. If that is going to take until spring, as some of us have been told, it might be useful to publish a draft Bill or a draft Command Paper that we could read several months before and have the opportunity to debate. That might help us resolve what the real problems are and how to deal with them, rather than on the Floor of the House for many days in Committee and on Report.
That is the purpose of my amendment, and I look forward to my noble friend’s response. I am not going to press this amendment, but it will be interesting to hear what he has to say.
Lord Grayling (Con)
My Lords, I will speak briefly on some of the themes that my noble friend Lord Gascoigne has been pursuing around reporting on performance. The Government seem to be a little reticent about being willing to accept amendments which increase reporting requirements. However, there is an important issue here: will public ownership do what the Government have promised it will and improve performance on the railways? I have my doubts about that. I think the challenges of the railways are much more complex and not about ownership but the complexity of our system.
I have a very simple question for the Minister. When you arrive in this House as a new Member, one thing that is very noticeable is the extraordinary level of expertise that exists on Benches on all sides. He brings a very considerable degree of expertise in this House after a long and distinguished career in the rail and transport sector. Can he set aside for a moment his ministerial hat and give us a professional judgment about the likely performance? To take a comparison, can he reassure us that the London Overground, for example, would perform better if run directly as a public body by Transport for London rather than being contracted out to a private operator as it is at the moment? Can he reassure us on that, for the precedents that will exist elsewhere?
Baroness Randerson (LD)
My Lords, Amendment 1 is impossible to disagree with. It is fundamental to the survival of our railways that things improve. They have reached crisis point because of decades of under- investment, poor management and poor political decision- making. However, the presence of this reminder might be useful for the Secretary of State. It might be a statement of the obvious in some ways but useful for her because the big problem with nationalisation is that Governments in the UK have consistently failed to invest long-term. We can improve buses by investing within a couple of years, but when you invest in the railways it takes a couple of decades for it to make a big difference. That is the Government’s challenge in renationalising the railways and the buck now stops with them.
On Amendment 16, I understand and strongly support the wish for thorough and transparent public consultation on the contents of the forthcoming rail Bill. I remind noble Lords of the example of the public consultation undertaken by the previous Government on their plan to close ticket offices. It led to a massive national outcry, forcing them to drop the plan, so I am a great believer in the impact of public consultations. The Bill that we are expecting in the near future is considerably more complex, but the problem with this amendment as written is that it extends the timescale that it all will take. It will take far too long before we get the legislation that we all hope will make the big difference. I will listen very carefully to the Minister. We hope that there will be some legislation by the end of next year at the very latest.
One way or another, the Minister has been associated with plans for the future of the railways and the creation of Great British Railways for some years now. There is surely nothing raised in our debates that he has not thought of, he has not worked on, or that would come as a surprise to him. He has been exceptionally generous with his time in cross-party discussions in the last couple of weeks. I urge him to explain when he replies what the timescale is likely to be and to assure us that there will be full consultation and that there is a grand plan.
Lord Moylan (Con)
My Lords, we have had lengthy discussion on this Bill in Committee, and it is not my intention today to repeat unnecessarily the arguments and the evidence adduced during those debates. The longer that we went on in Committee, the clearer it became that this is a very bad Bill that has been accompanied by a degree of arrogance. I do not say this as a personal comment on the Minister; it is on the part of the Government in general. There has been a tone, sometimes said quite explicitly, of “We won so we can do what we want”. That is an argument. It has some merit, but the merit that you would expect to find in an argument made in a playground.
Another type of arrogance has also been underlying our debates: “We want a better railway, but we are not going to tell you what it will look like. That’s all going to come in the future—don’t ask your pesky questions now. That will all be dealt with, and you have to trust us”. That is not a basis on which the House should be passing this type of legislation. The amendment in the name of the noble Lord, Lord Berkeley, goes some way to address that latter point. We all have a common desire for a better railway, but we will no doubt disagree on the details of how it is to be achieved. My noble friend Lord Grayling said that these are very complex issues. I do not think that anyone would disagree.
Therefore, on the prospect of having the Bill published in draft for pre-legislative scrutiny, I disagree with the noble Baroness, Lady Randerson. I do not think that will add materially to the time taken before legislation is enacted because it is likely to produce a better Bill when it eventually arrives in your Lordships’ House, one that can go through faster and be implemented better with better outcomes. It is the outcomes that we are interested in, not a particular timescale, although like her I will hold the Government to their undertaking that a Bill will come forward within 12 to 18 months.
It is more important to get the outcome right than to worry about a few weeks here or there, which is as much as we would be discussing in relation to the amendment tabled by the noble Lord, Lord Berkeley. I am deeply disappointed that he is not going to press it to a Division as I would be very tempted to support it if he did. However, I expect and hope that the Minister, when he stands up, can satisfy the noble Lord, Lord Berkeley, by saying that there will be some sort of pre-legislative scrutiny of the very large and complex Bill that he is expecting to bring before your Lordships’ House in the next 12 or 18 months, to use his phrase.
The amendment in the name of my noble friend Lord Lansley is very good and commends itself. Like him, I would like to hear what the Minister says in response. I note that my noble friend does not intend to press it to a Division.
Amendment 1, tabled by my noble friend Lord Gascoigne, is indispensable. A number of things are missing from this Bill. A number of important parties have been wholly excluded. One of them, for example, which we will come to later in debate, is the staff. There is no reference to the staff in this Bill. We take for granted that they will be TUPE-ed. That basic legislative cover is there and does not need to be stated. They will not lose their jobs as a result of this but will be TUPE-ed over. However, has any consultation been carried out with the staff? You would expect that normally, would you not? Do they want to change their employer? Do they want to be working for the Government? They may all say yes, but one would have thought that in an undertaking such as this the Government would have bothered to ask them. There has been no consultation with the staff.
The other glaring omission from the Bill is, of course, the passenger. It is a passenger railway services Bill, yet it says nothing at all about the passenger. My noble friend Lord Gascoigne is attempting to put this lacuna right and to put the passenger back at the head of the Bill, as the driving force of what the Government are trying to do and to require Ministers to test their actions under this Bill against the standard of whether it will improve matters for the passenger. That is why, if my noble friend intends to divide the House and seek its opinion on this matter, I recommend that we support him.
The Minister of State, Department for Transport (Lord Hendy of Richmond Hill) (Lab)
I thank the noble Lords, Lord Gascoigne and Lord Moylan, for Amendment 1. I absolutely support the idea that the Government should be clear about what the railway is for and what we want it to achieve. Far too many conversations in this industry are about tracks, signals and trains and how the railway works—or, in many cases, does not work so well. There needs to be much more focus on what the railway is for, but you can do that only if the organisation fundamentally works.
I am clear that when we establish Great British Railways, we should set out a clear statement of purpose, and we will set out a proposal for this statement of purpose in the consultation we will launch ahead of the substantive railways Bill. I am also very clear about the purpose of the Bill and the Government’s wider plans for the railway. Improving the performance of passenger services is clearly a big part of that purpose, but it is not and cannot be the only purpose. The Secretary of State has set out six key objectives against which she expects the railway to deliver. In summary, the railway should be reliable, affordable for passengers and taxpayers, efficient, of suitable quality, accessible and, of course, safe. She and I are reminding senior railway leaders of these objectives very clearly and very often. I expect that to carry more weight than a statement of purpose in a Bill that, if we are honest, might not be read widely by those on the front line of running the railway. Given the range of objectives that the Government wish to meet, I would not support the idea of singling out one objective, even a vital one, and placing it in this Bill.
Turning to the specific wording of the amendment, which is about performance, the easiest way to improve the performance of passenger railway services would be not to run so many of them, and to try to run fewer freight trains. It would be much easier to make trains run on time if the railway were less congested. Of course, I do not advocate that as a solution, but it illustrates the point that trying to reduce the Government’s objectives for the railway to a single purpose might be counter- productive. I hope that my remarks will have reassured the noble Lord that I am entirely on board with his underlying suggestion that the railway needs a clear statement of purpose, but I am not convinced that it needs to be enshrined in primary legislation right now, nor that it should focus exclusively on the performance of passenger services.
The noble Lord, Lord Grayling, asked me to set aside my ministerial hat and opine about the performance of the London Overground and the type of operator that operates it. I shall not set aside the hat, but I will say that one of the differences with the Overground is that it operates within a consistent and easily understood fares structure, which has enabled a significant increase in patronage over the period it has been operating. We must change the railway fares: there are far too many of them and they are deeply confusing. But one of the reasons for public ownership of the main network is to ensure that we have control of the operation and that there is enough information to be able to do that.
I will not trouble to respond to the point about arrogance and the Government acting, according to the noble Lord, Lord Moylan, as if we won the election, because it is rather self-evident that we did. I will remind him that this measure is very popular with the public, and every recent opinion poll suggests that a very large majority wish to see the railway in public ownership. We will return to the matter of the staff, but he acknowledges that the transfer of undertakings regulations will apply, and they do involve some consultation. But if you went to Waterloo station today and asked the staff there whether they want to change their employer, most of them would tell you that they have changed employer so often that some of them cannot remember who their employer is, and do not much care. The most frequent description of railway employment that I get when I speak to railway men and women—
Lord Moylan (Con)
Are not the staff of Waterloo station already employed by Network Rail?
Lord Hendy of Richmond Hill (Lab)
I was referring to the people who drive and operate the trains. There are more of them on Waterloo station than there are employees of Network Rail.
To finish what I was saying, most people on the railway refer to their employer and their work as “the railway”, which tells you something about the way in which the franchise system has dealt with loyalty to employment.
I thank the noble Lord, Lord Lansley, for Amendment 14 and the discussion we had in the last few days. He is right that Regulation 17 requires the publication of a specified list of information within one year, following the direct award of a contract, where that information has not already been published. However, we expect the majority of the information included in Regulation 17 to have already been published well before one year has expired. That is because Regulation 23, which covers post-award publication, requires a competent authority to publish a similar set of information within two months of contract award. The information which must be published is set out in Schedule 2. Regulation 23 also allows interested parties to request the reasons for a direct award within one month of the post-award publication. I agree that a year would be a very long time to wait before the information is published. However, I do not believe that the noble Lord’s amendment is needed because similar and, in many respects, more detailed publication requirements are already provided for in Regulation 23. I urge him to withdraw the amendment, and I note that he does not intend to press it.
I note that Amendment 16, from my noble friend Lord Berkeley, is somewhat novel constitutionally, as it would constrain parliamentary sovereignty by imposing limitations on when primary legislation relating to the railways could be introduced. I am very happy to confirm to my noble friend, to the noble Baroness, Lady Randerson, and to others who mentioned it that the Government intend to set out their key proposal for the railways Bill in a consultation document that I very much hope will be published before the end of this calendar year. This will give all interested parties, including Members of your Lordships’ House, the chance to review and scrutinise it and to feed in their views before the Bill is introduced later in this parliamentary Session. The Government do not intend to publish a draft of the Bill before it is introduced, as I would expect that to delay progress in implementing the Government’s planned reforms.
It is now more than six years since the previous Government declared that the structure of the railways is
“no longer fit to meet today’s challenges”
and appointed Keith Williams to lead his review. Passengers, freight and everyone on and who uses the railway have waited too far long already to see meaningful change. I have to say that my own experience is that the previous Government went through pre-legislative scrutiny in a desultory manner, and frankly, we all concluded that they did not intend to bring a Bill before either House any time soon.
While the Government are keen to hear the widest possible range of views on their proposals, including the noble Lord’s, I do not on this occasion support the idea of publishing a draft Bill. It also does not seem necessary, given that noble Lords can submit their views during the consultation I have committed to and will be able to debate the Bill once it is before the House. I am of course happy to meet with my noble friend Lord Berkeley and other noble Lords at the time of the consultation launch to seek their views, as we have done during the course of the Bill before us, if that would help persuade him to withdraw his amendment.
Lord Gascoigne (Con)
My Lords, I am grateful to the Minister for his response, to all those who spoke in this relatively short debate, and to those who supported my Amendment 1. I am pleased to see that the Government Chief Whip is on the Front Bench, and I am conscious that many people have sat through days of Committee and we are about to head into recess, so I will not detain noble Lords for long.
As I said in Committee and earlier, I want to make the case for why this amendment is not against the spirit of the Bill. It does not stop it, and I want to ensure that everyone knows that these changes are not being done through ideology and that they are focused on the passengers. Effectively, it forces the department, Ministers, civil servants and everyone to deliver this mission and this mission alone. Otherwise, we will enter into what President Ronald Reagan called “trust me” government.
Without boring on for too long, and to repeat the point I made, Labour has used this language repeatedly, in opposition and in government, so I am still not sure why the amendment cannot be included, especially given that the Minister, who I respect greatly, warmed to the sentiment behind it and understands it. As I said, we risk entering into the world of having to trust the Government that that is the intention. Despite those words of reassurance, the Bill still needs something on the face of it—Ronseal, like I said. With that, I would like to test the opinion of the House.
Lord Moylan
“25B Termination of existing franchise agreements(1) The Secretary of State must terminate franchise agreements for default in accordance with the terms of the agreement as soon as it is possible to do so.(2) The Secretary of State must assess and rank existing franchise agreements according to performance criteria established after consultation with relevant stakeholders.(3) Subject to subsection (1), the Secretary of State must only terminate a franchise agreement pursuant to a break clause if—(a) there are no other franchise agreements which are performing worse under the criteria in the list referenced in subsection (2), and(b) the Secretary of State is satisfied that provision of the services by a public sector company will improve existing service provision.(4) In this section, “break clause” means a contractual provision in a franchise agreement which entitles the Secretary of State to terminate the franchise agreement before the end of the franchise term by notice without reason.”Member’s explanatory statement
This amendment would require the Secretary of State to terminate franchise agreements for default and to nationalise the worst performing operators first, while enabling services that are currently working well to continue.
Lord Moylan (Con)
My Lords, in the course of debate at Second Reading and in Committee, numerous noble Lords drew attention to the fact that the manner in which the Government are approaching the termination of franchises is going to result in some very perverse outcomes. Admittedly, most of the franchises still in existence are relatively short, but the Government—with a view to saving money, as far as I can make out—are determined to terminate them in the order in which the contract falls in.
That has the bizarre consequence that some of the most popular, effective and highly rated franchises are going to be terminated early at the head of the list, while those that are most reviled by the public—I am not going to mention any names in the course of this brief speech—and regarded as being hopeless at what they do will have the longest continuation in existence. It is of course the case that if they fell into default, the Government could terminate them early without expense, but we heard from the Minister earlier that none of them is as bad as that. None the less, some of them are very bad indeed.
This case was made most compellingly at Second Reading by the noble Lord, Lord Browne of Ladyton, but it has been made by other noble Lords as well. I think there is strong demand among noble Lords for the worst franchises to be brought to the head of the queue. My Amendment 2 would have the effect of bringing that about: the worst-performing operators would be terminated first, while services that are currently working well would be enabled to continue. Amendment 10 in the name of the noble Baroness, Lady Randerson, has a similar intent and effect. It is drafted differently—it is expressed as providing flexibility to the Government, whereas mine is perhaps a little more mandatory in its tone—but they are similar in various ways.
With the time the Government have had for reflection on the strength of feeling in the House about this issue, they should be able to come forward and say something now that would alleviate noble Lords’ concerns. Otherwise, I will be interested in testing the opinion of the House on my Amendment 2.
Baroness Randerson (LD)
My Lords, I will speak to Amendment 2, and to Amendment 10 in my name and that of my noble friend Lady Scott. Amendment 2 was the Liberal Democrats’ Amendment 1 in Committee, requiring the Secretary of State to terminate franchises for default and to nationalise the worst-performing operators first, while allowing train operating companies that are currently working well to continue.
The Minister explained to us, both in this Chamber in response to our amendment and in private discussions, that this cannot be done without major costs to the taxpayer. The existing contracts have been written and signed by the previous Government so as to make it difficult to penalise defaulters. We accept what the Minister says and we are not prepared to cause the taxpayer greater costs than necessary in this process. So, having listened and learned, we turned our amendment around and wrote Amendment 10, which simply proposes giving the Secretary of State the freedom to enable services that are working well to have an extension to their franchise and to continue for a period of time suitable to the Government. Can the Minister explain to us the Government’s approach to this and whether existing contracts could be extended, as our amendment suggests?
Our view is that the Government are going to be hard pressed in dealing with the numerous parts of the rail systems that are failing, and they need to allow themselves a bit of space by letting the bits that are working well continue until they get around to the overall process of nationalisation. The Government’s whole approach has been nationalisation gradually rather than one big effort, and I hope this amendment works with the grain of their intentions.
Lord Liddle (Lab)
My Lords, from listening to the noble Baroness, Lady Randerson, I think there is a misunderstanding about what the Government are trying to do. As I understand it as a humble Back-Bencher, we are trying to get rid of the franchising system because, as it is, it does not help us to run a railway in the way we want to. In his opening remarks the noble Lord, Lord Hendy, said that one of the points is to have a simplified fare system that will greatly raise the prospects of increasing passenger revenue and passenger use of the railway, because the fare system is an obstacle to that. We cannot do that while we have the franchise system, so we have to get rid of the franchise system.
If there is any fault in what is happening at the moment, it lies on the opposite side of the Chamber and with the Transport Ministers who gave operators such as Avanti the very loose targets that they have to meet. I advocate that we should be tougher with Avanti, have it in every month, and if things have not improved, we should take the risk of taking the franchise off it and saying, “See you in court”. That would be my approach, but the problem is what the Conservatives have left us with, and that is very difficult to solve. I do not support this amendment, which would result just in extending the existing system.
Lord Young of Cookham (Con)
My Lords, I am glad I let the noble Lord, Lord Liddle, speak before me, because I listened very carefully to what he said at Second Reading, when he made a powerful speech in favour of pragmatism. I think that was an expression that he used; I see him nodding in assent. Pragmatism is the reason behind Amendment 10. It is a question of whether we let ideology trump pragmatism. The amendment is very similar to one I proposed in Committee. It is less ambitious—the one I proposed in Committee would have allowed the franchise to be renewed for a longer period than 12 months—and therefore one that is it easier for the Minister to accept.
There is an additional reason that has not been mentioned so far, which is that there will be pressure within the Minister’s own department to absorb the franchises as they fall due. I think his department would welcome the flexibility under Amendment 10 to enable an existing franchise to be extended for a further 12 months, but no longer. The Minister will get his way: all the train operating companies will be nationalised and all the franchises will come to an end. What we are arguing about is some flexibility. If a franchise is being run perfectly competently, if the existing company would be happy to run on for another 12 months, and if the department is having to recruit more civil servants to absorb the existing ones, I honestly cannot see why the Minister has set his face against Amendment 10. If there is the word “resist” in his brief, perhaps he will reflect on whether a little bit of flexibility would be in order.
Lord Snape (Lab)
My Lords, I expressed some sympathy with this amendment, or an amendment similar to it, in Committee. Without repeating anything I said in Committee, I put it to my noble friend the Minister again—having said one thing, I now contradict myself—that it does not really make any sense to terminate instantly or as soon as it runs out, which is pretty close to instantly, a franchise such as Greater Anglia, which has generated enormous public support for the efficient way that it has run its train services, or c2c, the line from Liverpool Street to Southend, which recently scored a 94% approval rate as far as its passengers were concerned, although I imagine they, like most other sensible people in this country, think the franchising system has been pretty disastrous for the railway as a whole. Coincidentally, those two franchises run out fairly quickly. Although the noble Lord who speaks for the Opposition would not mention specific franchises for some reason, I will. I have been tormented by Avanti since the last Government were unwise to give it the franchise around 2017 and take it off Virgin, for no apparent reason. The last Government then gave Avanti a nine-year extension, despite all the complaints from both sides of your Lordships’ House. Does it really make any sense to terminate franchises that have enormous support from the travelling public, two of which I have just mentioned, and not take any action for another few years—about seven years or so—for companies such as Avanti? Surely there is some flexibility here that my noble friend could press.
If there are good reasons to terminate franchises then surely those reasons, good or bad, have been realised as far as Avanti’s performance is concerned. Perhaps my noble friend can tell us exactly how much it would cost in public funds to dispose of Avanti’s services and how the contracts were drawn up and interpreted in the first place, when a company like that can get away with the shoddy service that it provides daily.
Lord Hendy of Richmond Hill (Lab)
I thank the noble Lord, Lord Moylan, and the noble Baronesses, Lady Randerson and Lady Scott of Needham Market, for their amendments in this group—Amendment 2 and Amendment 10 respectively. The amendments seek to test the Government’s approach of transferring services as existing contracts expire. I also thank my noble friend Lord Liddle for saying that the intention is to get rid of franchises and for explaining why. He is right. I should also say that I and the Government do not believe that we should either pay compensation for termination or keep paying fees to owning groups of train operating companies when we do not need to.
I am happy to begin with a reassurance about the Government’s position. We will not hesitate to take decisive action if Avanti, CrossCountry or any other operator’s poor performance means that the contractual conditions that allow for early termination are met. The contracts we have inherited from the previous Government make it far too hard to get rid of an underperforming operator, but if we have the opportunity to put passengers out of their misery by ending a failing operator’s contract early and bringing their services into public ownership, we will do just that. In those circumstances, we will not wait for those contracts to expire.
The noble Baroness, Lady Randerson, and the noble Lord, Lord Young, asked whether the public sector operator will have the capacity to take in services from a failing operator whose contract has been terminated early, at the same time as other planned transfers. I reassure them that current contracts allow sufficient flexibility to accommodate this. All but two of the current contracts with private operators give the Secretary of State significant discretion to select an expiry date within a range of possible dates specified in each contract. The Secretary of State simply has to give the outgoing operator a minimum of 12 weeks’ notice of expiry. This means that if a contract can be terminated early for poor performance—be it by Avanti, CrossCountry or any other operator—the Secretary of State will be able to adjust the planned expiry dates of other contracts if necessary to ensure that the failing operator’s services can be transferred as quickly as possible without overwhelming the public sector operator. Of course, we also need a programme of return that is reassuringly steady for the good management of the operations as they come back into public ownership. I hope those observations will be sufficient to persuade the noble Baronesses not to press their Amendment 10.
In response to the noble Lord, Lord Moylan, my previous comments address the first part of his Amendment 2. The Government will not hesitate to exercise its contractual rights if an operator’s poor performance means that the conditions for early termination are met. The Secretary of State, my noble friend Lady Blake of Leeds and I have all made the Government’s position on the matter very clear and on the record. There is no need for a statutory obligation to cover this point.
The noble Lord knows very well that I cannot accept the remainder of his amendment because it would substantially delay the programme of transfers to public sector operation. As the noble Baroness, Lady Randerson, said, thanks to decisions taken by the previous Government, the two most poorly performing operators currently have the longest contracts, with terms that make it very difficult to terminate them early for poor performance. I cannot say quite what the cost is, but I will write to my noble friend Lord Snape to tell him the rough quantum. In fact, the amendment from the noble Lord, Lord Moylan, would mean it would be impossible for the Secretary of State to exercise any contractual break clause, as defined in his amendment, until after the worst-performing operator’s contract had ended. That could be as late as October 2027, so it is difficult to see this as anything other than a wrecking amendment. I hope the noble Lord will prove me wrong by withdrawing it.
Lord Young of Cookham (Con)
Before the Minister sits down, can he just clarify something that he said? Is it the case that under new Section 30A inserted by Clause 2(3) he has the flexibility already to renew two of the franchises mentioned by the noble Lord, Lord Snape, by using that particular paragraph in the Bill—namely, that he
“is satisfied that it will not be reasonably practicable to provide”
the services in any other way?
Lord Hendy of Richmond Hill (Lab)
Is that the two worst-performing franchises or two others?
Lord Young of Cookham (Con)
Any franchises. Can he use that section to renew the satisfactory franchises, because it would “not be reasonably practicable” to do so otherwise, and take them in-house?
Lord Hendy of Richmond Hill (Lab)
I thank the noble Lord, Lord Young, for his intervention. I think he is right, but he will forgive me if I consider it further and write to him.
Lord Moylan (Con)
My Lords, with the leave of your Lordships’ House, I may speak for slightly longer than would be normal because I would like to address a comment made by the noble Baroness, Lady Randerson, about my Amendment 2. She said that it was the same as Amendment 1 tabled by the Liberal Democrats in Committee. In fact, that is only superficially the case. While proposed new Sections 25B(1) and (4) are the same as in the amendment tabled in Committee— I think, by the noble Baroness, Lady Scott of Needham Market—the meat in the sandwich, so to speak, has changed. There would be no additional cost in early termination fees as a result of this amendment as drafted because the franchises would be terminated not as they fell in but in order of worst first, even though that might take a little longer.
I listened very carefully to what the Minister said. Although the Minister found it helpful, the intervention from the noble Lord, Lord Liddle, was, to this side of the House, slightly infuriating. Throughout the debate in Committee there was a constant jumping between asking us to please focus on this narrow, technical Bill to then, when we wanted to talk about the narrow, technical Bill, being told that we should be talking about the great, big, wonderful Bill that will be coming in 18 months, because that is really what this is all about. But we cannot talk about that Bill because we have not seen it—indeed, we are not even going to get to see it in pre-legislative form. So although the Minister found it helpful, it illustrated the constant problem we have had in dealing with the Government on this measure.
For that reason, I am afraid I am not sufficiently satisfied with the Minister’s comments in respect of my Amendment 2 and I would like to test the opinion of the House.
Lord Lansley
“(1A) In section 4 (general duties of the Secretary of State and the Office of Rail and Road) omit paragraph (1)(d).”Member’s explanatory statement
This amendment probes when - and in relation to which services - Ministers expect to meet their duty to promote competition.
Lord Lansley (Con)
My Lords, the purpose of Amendment 3 in my name is to explore the question of when and under what circumstances it is the Government’s intention to meet their duty in Section 4(1)(d) of the Railways Act
“to promote competition in the provision of railway services for the benefit of users of railway services”.
It was prompted by a very brief exchange that took place in Committee, where the Minister confirmed that it is not the Government’s intention to remove that duty. However, it is clearly their intention, in relation to passenger railway services, very substantially to reduce competition and perhaps to exclude it altogether. There may well be other areas of activity in the provision of railway services which are open to competition, and I want to examine where those should be. Of course, I approach this not with the intention that the duty to promote competition should be removed from the Act, but with the view that it should be exercised.
I am in favour of competition. I might say, in this context, going back many years, that where privatisation is concerned, we have found that competition between private organisations yields benefits. In the railways, in some circumstances, we have found that the absence of competition has been at the heart of the problem: that the performance has not been exposed to competition and therefore has not improved in the way we would have wished it to. So, competition works, privatisation does not necessarily work, but the combination of privatisation and competition, in my view, has worked in the past. However, we are not here to discuss privatisation; we are here to discuss competition, and there is a continuing role for competition, in my view.
I am not planning to talk at length about Amendments 13 and 17 in this group, I will leave that to my noble friend on the Front Bench, but Amendment 17 is directly relevant. One of the principal opportunities for competition would be with open-access operators. In Committee, we touched upon but did not find out whether, and to what extent, it was the Government’s intention to continue to permit open-access operators or indeed to promote them. In my view, promoting them can be a very effective way of stimulating competition and innovation, which are often—as Schumpeter would have said—very intimately linked together.
My contention in this amendment is very simple: to explore where competition will be available. Clearly, it can be done with things such as the provision of rolling stock and services to railways, and maybe, to some extent, in relation to rail freight. As far as passenger railway services are concerned—and we are dealing with that here—the Government’s intention appears to be that every aspect of the passenger railway services should be subject to the “directing mind”—as the Explanatory Notes sets out. Therefore, it will be very difficult for there to be any substantial competition, except if that can be achieved by the role of open-access operators. I hope, when he responds to this debate, the Minister will be able to say they will have a continuing role, or even that they might be encouraged to bring the innovation and competition that would enable us to avoid the downside of a dominant provider.
We have seen this in other circumstances. For example, in France, the dominance of SNCF has led to abuse such as anti-competitive pricing or the overbooking of train paths to restrict competition from other providers. We do not want to see the dominance of public sector providers, on passenger railway services, to lead to that kind of abuse. Still less do we want to see monopoly activity on the part of public sector companies in passenger railway services lead to an elevation of the interests of the companies themselves over the interests of the users of railway services. The general duty to promote competition is for the benefit of the users of railway services because, very often, they are the ones who most see the benefit of that.
I will just tease the Minister, finally, by saying that in this legislation he has the opportunity to move in the opposite direction to the fourth railway package under the EU’s transport legislation. Here is an uncovenanted Brexit bonus for the Government, in being able to move in the opposite direction to the thrust of legislation in the European Union. With that teasing moment, I beg leave to move Amendment 3.
Lord Moylan (Con)
My Lords, I rise to speak to Amendments 13 and 17 in my name, but also to respond to my noble friend Lord Lansley in relation to Amendment 3. We come now to the heart of a considerable confusion that exists in the Bill, one that the Government have done their very best to avoid and that needs to be flushed out.
My noble friend Lord Lansley refers to competition. In fact, he refers to the abusive practice by monopoly railways in France. That, of course, is in response to European Union legislation, which has had to mandate access to competition in order for it to flourish in the European Union. It is going in the direction that we went in, somewhat later than us. We are now going back to the Attlee Government, basically, and moving away from that. It is a Brexit bonus, as I think I said in an earlier debate.
The matter is made worse because the Government have not been clear about their view on competition. It has been made much worse by the Government’s confusion and blank refusal to address the question: who is going to make the decisions about competition? Who is going to decide, in relation to open access, which providers will have access to the service? I refer, as I was encouraged to do by the Minister, to the Labour Party document Getting Britain Moving. In its section 7 on “The role of open access”, beginning on page 22, it says clearly:
“The ORR will continue to make approval decisions on open access applications”,
but that is not confirmed by the Minister. Instead, we have the spectre of Great British Railways making open access decisions. That appears to be part of the great controlling brain: one of its functions is that it would make those decisions about open access. But in doing so, it will be making decisions directly about competition with itself.
We are very concerned that the sort of abusive monopoly activity seen in France, which my noble friend has referred to, is exactly what we would be exposing ourselves to if we allowed this measure to go through without having appropriate safeguards in place in advance. That is the thrust of Amendment 17, which simply calls for a report. In Committee the Minister made fun of me for calling for so many reports, but he should understand that we are doing this as a way of drawing attention to an issue of serious concern without trying to hobble or wreck the Bill. He has not given us any assurance in response. He has taken no notice of our very genuine and serious concerns.
Amendment 13 relates to a similar topic, in relation not to open access for passenger railway services but rather to access for freight services. They too compete, so to speak, for paths on the railway; they need access to the railway if they are to operate. The previous Government had an informal and non-statutory target of seeing the volume of freight on the railways increase by 75% by 2050 from a base of, I think, two years ago. This amendment would effectively put that target into the Bill.
Nobody in the Labour Party, either in opposition or in government, has resiled from or rejected that target. If anything, I think they want a more exacting target. The Minister, if pressed, would probably say that it was a perfectly respectable target, one that he would want to sign up to, so there should be no objection to seeing it in the Bill. It would give some assurance that Great British Railways, in its operations, would not simply favour its own activities at the expense of freight operators. Ideally, we would also want some sort of assurance that it would not favour its own passenger activities at the expense of open access operators.
Lord Snape (Lab)
My Lords, I rise to say a few words on Amendment 13 and the future of rail freight once this legislation becomes law.
Traditionally, on nationalised rail in the past, freight was often seen as the poor relation. Trying to attract people to the freight side of the former British Rail, particularly getting management involved, was much more difficult than the passenger side. There was a bit of glamour about fast passenger trains that the freight network never shared. My noble friend the Minister spoke in Committee about the Government’s intention to increase rail freight by 75% by 2050. I would be grateful if he could provide some clarification as to how that will be done.
I look at railway operations from time to time on the website OpenTrainTimes—I am a devotee, and this is a terrible confession to make. I note how close to the timetable rail freight adheres these days, which was not necessarily true in the past. There was a welcome introduction of relief from access charges for new business, as far as rail freight was concerned. Can my noble friend tell us whether there is any intention to extend that? Indeed, we should go further. In Committee I pointed out the imbalance in taxation in this country that makes it cheaper and more attractive to buy a fleet of lorries and put them on our road network—where, of course, the infrastructure is paid for out of general taxation—than it is to run rail freight, as Royal Mail has, deplorably, just demonstrated.
While I would not seek to pin down my noble friend the Minister as far as future taxation policy is concerned, I certainly hope he can press Treasury Ministers to see whether something can be done in future to rectify that imbalance between rail and road. In speaking to Amendment 13, I hope that my noble friend can give me some reassurance as to how this envisaged increase in rail freight—welcome though it is—will be implemented.
Baroness Randerson (LD)
My Lords, these three amendments deal with crucial aspects of the running of the railways and they are issues that we on these Benches probed in Committee. I certainly anticipate that, when we get the full Bill next year, there will be long and vigorous debate and discussion about them and I have serious reservations about the possible plans. However, we on these Benches accept that, however concerned we are about freight or open access or competition, the Government have chosen to write a very tightly drafted Bill and to separate ownership from operational organisation in that Bill and it is not appropriate to try to write, in a rather haphazard way, the big, final Bill on Report in this House at this time.
Lord Hendy of Richmond Hill (Lab)
I thank noble Lords for their amendments in this group. In response to Amendment 3, from the noble Lord, Lord Lansley—and I thank him for our discussion a few days ago— I will highlight two important ways in which this Bill promotes competition.
First, there will continue to be huge opportunities for competition between businesses in the supply chain which publicly owned operators and Network Rail will continue to depend on. I was speaking this morning at the Railway Industry Association’s conference and it welcomed clarity about the Government’s intentions with enthusiasm, because it knows as well as we do that the railway, after six years of being promised reform, needs to understand what reform might look like in order for its businesses to prosper. Public ownership and our plans for GBR to provide long-term strategic direction for the whole railway will give greater clarity and certainty to businesses in the supply chain and so will support healthy competition.
Secondly, in relation to competition between train operators, the Bill preserves the existing arrangements for open-access operators. Open-access services are the only source of meaningful competition between operators on today’s railway, and this Bill makes no changes to the way in which open-access applications are treated by either Network Rail or the independent regulator, the Office of Rail and Road.
Having set out how the Government’s approach is consistent with a duty to promote competition, I also note for completeness, referring to the propositions of the noble Lord, Lord Lansley, that the Section 4 duty applies to the Secretary of State only when she is exercising certain functions under the 1993 Act. It does not apply to the exercise of her functions under Sections 23 to 31, which are the franchising functions that are amended by the Bill. As such, there can be no question of this Bill impairing the Secretary of State’s ability to comply with the Section 4 competition duty.
Turning to Amendment 17, tabled by the noble Lord, Lord Moylan, open-access operators are a valuable part of the system and will remain so following this short Bill. Looking ahead to the wider railways Bill, we see a continuing role for open-access services where they add value and capacity to the network. I will say more in a moment about how their interests will be protected. In the meantime, I reiterate that the current short Bill has no impact on open-access operators, the services they provide or the process by which they can secure rights to operate on the rail network. For this reason, the report required by this amendment would serve absolutely no purpose; the Bill plainly has no impact.
Requiring this report—not just once but every single year in perpetuity—would simply place an additional reporting burden on Network Rail and the Office of Rail and Road, and potentially also on open-access operators themselves if they were each required to provide information about their services to inform each report.
Finally in this group, Amendment 13 deals with freight. My noble friend Lord Berkeley is a staunch advocate of the rail freight sector and I hope that I can reassure him and the noble Lord, Lord Moylan, about the Government’s intentions. The Government hugely value the rail freight sector and recognise the importance of its contribution in reducing congestion on our roads and in helping our transport system move towards net zero.
I entirely agree that the Government’s plans for reform under the railways Bill must ensure that Great British Railways promotes growth in the freight sector and must provide suitable protections for freight operators. We will set out our detailed plans in the consultation I have already referred to as soon as we are able to.
In the meantime, I am very happy to reassure noble Lords on three fronts. First, our proposals for the railways Bill will include a statutory duty on Great British Railways. I have reflected carefully on the remarks of the noble Baroness, Lady Randerson, in Committee, and the remarks just made by my noble friend Lord Snape, and as a result I now confirm that this duty will be not merely to enable the growth of rail freight but to promote it. My noble friend Lord Snape referred to variable access charges. I very much agree that we would seek more of that in the future to encourage more freight traffic.
Secondly, the Secretary of State will set a specific freight growth target for Great British Railways. I cannot confirm today the specific detail of what that target will be, but we will set out our plans for that in due course.
Thirdly, I thank my noble friend Lord Berkeley in particular for his comments on the importance of a fair system for the allocation of access. As discussed with my noble friend last week, I have confirmed today that there will be consultation on the Government’s reform proposals, and that the consultation will set out the proposed role for the Office of Rail and Road in the access decision-making process. Any changes will then be set out in the railways Bill itself, so noble Lords will have ample chance to debate these matters before changes are implemented.
I also reassure noble Lords that our proposals for allocating capacity and granting access to the network will include safeguards to ensure that both freight and open-access operators continue to be treated fairly. As I have already said, I would be delighted to meet with my noble friend and other noble Lords with an interest once the consultation has been published, so that we can discuss the details and continue the very helpful conversations we have started here.
Turning to the specifics of the noble Lords’ Amendment 13, the statement required by this amendment would be very short and sweet. There is no need to wait six months after Royal Assent for me to provide this statement; I can give it to the noble Lords now. The Bill is narrow in scope. Its purpose is simply to allow the Government to transfer the operation of franchised passenger services to the public sector. It does not make any changes to the arrangements under which freight services operate. This means that the Bill will not, and cannot, have any adverse impacts on the freight sector or on freight growth.
I have clarified the impacts of the Bill on competition, open access and freight, I have confirmed that we will soon publish a consultation document setting out our proposals for the railways Bill, and I have reaffirmed that these proposals will consider appropriate protections for freight and open-access operators. In light of what I have said, I hope that noble Lords will agree that there is no need to pursue their amendments further today.
Lord Lansley (Con)
My Lords, I am very grateful to all noble Lords who have taken part in this short debate. It has raised a number of important issues, and I am grateful to the Minister for the clarity that he brought to the subject—partly from my own point of view, in understanding how the legislative provisions work, which is always helpful. I have to confess that I know much less about railways than the noble Lord, but I try to find out how legislation works, since that is part of our job, and what he said was very helpful.
What he had to say about there being no changes to the legislative provisions and the arrangements in relation to open access was important and I will come back to that in a minute.
I do not think there is any merit in pressing the amendment now, because when we come to look at the role of Great British Railways in the major Bill to follow, we will look at issues such as the one my noble friend raised—the relationship between Great British Railways and the control of train paths. That is exactly the problem that occurred in France, and I think my noble friend Lord Moylan also discussed the abuse of a dominant position. We will need to look at how that kind of scrutiny and competition can be sustained, notwithstanding the monopoly aspects of Great British Railways. However, in light of all those helpful points, I beg leave to withdraw Amendment 3.
Lord Lansley
Member's explanatory statement
This probing amendment seeks to understand the circumstances where Ministers may provide services other than by direct award of a public service contract to a public sector company.
Lord Lansley (Con)
My Lords, this is the last group on which I plan to speak. My amendment was prompted by a debate in Committee that gave rise to the question of how the new legislation would work. We have established, including during the previous group, a number of things that do not change, including the licensing of railway services and the prohibition on operating without a licence. The relationship with open- access providers therefore does not change, since they can make applications to the Office of Rail and Road for that purpose—I am paraphrasing, but that is, broadly speaking, how it works.
Where we have a change is in the process for franchising, which is to be removed. The Government have chosen to change the franchising provisions in the Railways Act, in Section 30 et cetera, and to replace that text with what we see in the Bill. I really want to explore this question: to what extent will all designated railway services be brought under Section 30, from new Sections 30A to 30C? I want to explore the consequence of the use of the word “only” in that provision. It says that a service must “only” be provided by
“a direct award of a public service contract to a”
wholly owned public sector company. In effect, it will be wholly owned by the Secretary of State—not, as we have discovered, other public sector companies.
The removal of the word “only” would, in the way in which the text works, as far as I can see, create an opportunity for the Secretary of State to provide or secure the provision of services by routes other than the direct award under Regulation 17. Clearly, that is not the Government’s intention. I will not return to the debate I promoted in Committee, but it would be good legislation to leave that option open to the Secretary of State, even if it were not the Government’s present intention to use it, because they may find it valuable to be able to do so in future.
Let us look at a practical example. Imagine that the Government thought it desirable to say that a service such as the one from Fenchurch Street to Southend and Shoeburyness should form part of the Overground services under the operating control of Transport for London. As far as I can see, as things stand, if that service is designated under Section 23 of the Railways Act—the designation requirements—it will have to be run by a public sector company wholly owned by the Secretary of State, unless it is the subject of an exemption under Section 24. In Committee, I think we heard the Minister say that the Government have no plans to extend the exemptions under Section 24. That raises another question for the Minister. Would he entertain that there may be circumstances in which it would be desirable to extend Section 24 exemptions? While London is a straightforward example, will the Government be open to that possibility, if it were a practical mechanism of securing the best operation of those services?
To what extent is the language of the Bill very deliberate, in that it requires that the Secretary of State may secure the provision of these services only through a direct award, but it does not say that the Secretary of State may provide or secure the provision of these services only by this route? I am making the distinction between “provide” and “securing the provision of”. This is customarily seen in legislation as a distinction between a government department doing it itself and doing it by means of a contract.
Where in this does the Department for Transport’s operator of last resort holdings company sit? Does giving an award of a contract to OLR Holdings Ltd constitute securing the provision of a service, or does it constitute providing the service? Is it regarded as part of the department for these purposes, or is it part of a wholly owned public sector company? There would be something rather odd now about treating it as part of a franchise agreement, since these franchises have already ended. Bringing it under a regime that is about the ending of franchise agreements seems odd.
My second example concerns East West Rail. We are not far away from the point when East West Rail will be running services itself on its new rail services. That will be very welcome—not least from my point of view, living in Cambridgeshire—when it reaches, as the Budget told us, all the way into Cambridge in due course. It will be running services quite soon in Oxford and Bletchley. It has not had a franchise; clearly, it will not now be given a franchise. It is a wholly owned public sector company. Is it the Government’s intention that it will be brought within the scope of Section 30? If so, this is odd, as this is an arrangement for franchises, but it has never had a franchise.
Of course, on the face of it, the Government will continue to designate railway services. Presumably—and here is a question to the Minister—there will be a comprehensive designation of railway services under Section 23, and that will, as a consequence, bring them all under Section 30 because of the way the legislation is now to be phrased. Therefore, is the intention, in effect, to bring all designated railway services under the scope of Section 30 et cetera, other than those exempted under Section 24?
I am sorry for asking a range of questions to explore how this works. We did, as the Minister has kindly mentioned, have the opportunity to discuss this a few days ago, so I hope he will have had the opportunity to think about explaining precisely how these interactions in the legislation will work. I beg to move.
Lord Moylan (Con)
My Lords, I am very grateful to my noble friend Lord Lansley for posing those very interesting questions. I am sure that the Government have answers to them, but they illustrate that this legislation is essentially very rushed and that they have not properly considered it.
I promise not to repeat what I said in Committee, but I cannot resist referring back to the final impact assessment, produced by the Department for Transport. It said that the purpose of the Bill is to meet a manifesto commitment, so it has not undertaken the normal practice of looking at alternative methods by which the same objectives might be achieved, because they are all in a terrible rush as the Government want to have a headline, essentially, and want to get ahead of the franchises as they expire. Therefore, I appreciate what my noble friend Lord Lansley has said, and I look forward to the Government’s reply.
Amendments 5 and 6, standing in my name, are linked. If Amendment 5 were to pass, I understand that there has been discussion with the Government Front Bench that Amendment 6 would pass without a Division in order to avoid having two votes on the same topic.
In Committee, I referred to two different models by which the private sector might be involved in the running of railways. One is the franchise system that we are currently discussing, which is the main subject of this Bill, but the other, generally dubbed the concession system, is the one used by Transport for London for the operation of all its services other than the London Underground, which is directly provided by Transport for London. All the other services—the buses, London Overground, the DLR, the tram and so forth—are provided under a concession system; that is, they are run by private companies on a contract.
The key difference between the franchise system and the concession system is that under the franchise system, as envisaged at privatisation, the fares risk rests with the operator. That was the model that was set up back when privatisation was introduced. If the fares went up and the companies generated more fares income, they would keep it; if they lost money on fares, it would be their problem that they did not make money because the fares were not good enough. Companies had the incentive to generate more fares, principally by generating more passengers, through all the clever things that they would do.
I was frank and straightforward in saying at Second Reading that that aspect of privatisation has never worked well because, essentially, private operators are not in control of fares income, which is closely correlated with the economic cycle—which of course they cannot control, manage or in any serious way mitigate. That aspect has never worked well, and Covid put an end to it in any meaningful sense. It has never recovered from that, nor, given this legislation, is it ever going to have the chance to recover.
The concession system is different, in that the fares risk remains with the franchisor. In the case of Transport for London, it is the franchisor of the services I referred to and it retains the fares risk. The obligation of the private sector operator is simply to have the trains and equipment in the right place, pointing in the right direction first thing in the morning, properly staffed, cleaned to a certain standard and so forth. If it fails to do those things, it will suffer financial penalties. The important point is that all those things are within its control. It receives a fee for that, but, in practice, because of competition, it is a modest fee given that risk is very limited. The risks are all things that are just a matter of it doing its job properly; if it does it properly, it will get that modest fee without penalty.
The purpose of Amendment 5 is to open up an option. It makes no obligation on the Secretary of State. When a franchise is terminated, the Secretary of State would have the option of awarding it not only, as the Bill is currently drafted, to a public sector company that is a subsidiary of the Department for Transport but to a private sector entity on a concession basis. The reason for it is simply that we know that it works. We know from Transport for London that the system can be made to work very effectively. We know that some of the best services on the Transport for London network—some of the best modes—are provided under this system. Why should it be that the Government would want to rule that out? Of course there could be a role for the private sector operating on that concessionary basis.
My noble friend Lord Lansley’s amendment gives the Government more options than mine does. My amendment gives the Government one extra option, but he would give the Government effectively limitless options by deleting the word “only”, whatever options might be available. It would give the Government more flexibility in dealing with circumstances that they may not have foreseen when they drafted this Bill.
Amendment 6 goes with Amendment 5 simply by defining in a separate clause what I mean by concession. Amendment 5 opens up the choice to do something on a concession basis and Amendment 6 says what a concession is. Despite every effort on my part and that of the Public Bill Office, we could not quite combine these into one amendment, so they stand on the Marshalled List as two amendments which, in practice, are closely linked, as one amplifies and clarifies the other.
I would very much like to hear from the Minister why Amendment 5 would not be acceptable, except to a control freak. That appears to be perhaps the Government’s vision for the railways.
Baroness Randerson (LD)
My Lords, this group raises some interesting questions about the various shapes that the ownership of rail services can take. Our interest on these Benches, which we raised in Committee, is specifically the interface between the Government’s picture for national rail services run by the Government and those run by devolved authorities. We are interested in seeing that nothing in this Bill attacks devolution as it currently exists or stops the further development of devolution when it is properly and fully thought through. We are interested in ensuring that nothing in this Bill would prevent current devolution models continuing and new ones from being established. Those devolution models include aspects of private sector involvement.
In addition, in Committee, the noble Lord, Lord Liddle, raised some interesting questions about alternative public/private models and not-for-profit models. I hope that he will speak about those again in this debate.
I will be listening very carefully to the Minister’s response. If I understood him earlier in our discussions about this, he has reassured us about devolution, but I need an additional public response on that issue. With that, I take note of a very interesting aspect of this debate.
Lord Liddle (Lab)
My Lords, I will speak briefly, as the noble Baroness, Lady Randerson, mentioned what I said in Committee.
It is right to raise these questions here, but they are questions for the future and for the big Bill that we will get next year. Personally, I do not want to see the re-creation of British Rail. My dad used to work for it, and to my mind it did not have great success as a monopoly nationalised industry. Therefore, it is right that, in the debate about the Bill setting up GBR when it comes around, we should explore the models of ownership that might work on these concessions. I would not rule out co-operative models, or heritage railways, running part of the national network.
My main concern is that we do not get stuck on the idea that this has to be a public sector monopoly. After all, the main thrust of Labour policy, the manifesto on which we won the election and the Budget put forward by Rachel Reeves is that we should use public investment to generate private investment, which will multiply the effects on economic growth. I do not see why the railways should somehow be different from that general principle. I discussed this with the Minister, and he explained how one thing being looked at is using the private development of Network Rail-owned land to improve investment in services. That strikes me as a very good idea and something that we should look at. Noble Lords are right to raise this question, but I hope we are going to have an open-minded debate about it in the coming year.
Lord Hendy of Richmond Hill (Lab)
I thank the noble Lords, Lord Lansley and Lord Moylan, for their amendments in this group. I will speak first to Amendment 4. Following enactment of the Bill, there would be just two routes by which the Secretary of State could secure the operation of passenger services. The first option, and this is the option we plan to use, would be to make a direct award to a public sector company under the amended Section 30 of the Railways Act 1993 and in accordance with the Public Service Obligations in Transport Regulations 2023.
The second option, which is a very limited option, would be to use the power to continue an existing private sector franchise temporarily under new Section 30A. This power is deliberately limited only to circumstances where the Secretary of State is satisfied that a transfer to a public sector company is not reasonably practicable. This means the Government would expect to use it only as a last resort, for a short period, to avoid a transfer causing disruption to passengers or staff. Apart from this very limited power in new Section 30A, the Bill leaves no other route by which the Secretary of State could contract with a private sector operator to run either existing services or new ones. This is entirely consistent with the Government’s very clear policy in favour of public ownership of services that form part of the national railway network.
On the point from the noble Lord, Lord Lansley, about DfT OLR Holdings Ltd, I confirm that award to it is securing the provision. All services currently designated under Section 27 will be provided under Section 30 by a public sector operator as existing contracts expire. The noble Lord also asked about the Secretary of State’s power to secure the provision of new services through a public sector company if those services had never been provided under a franchise agreement. Regulation 21 of the Public Service Obligations in Transport Regulations 2023 allows the Secretary of State to vary the terms of a public service contract to include additional services, and so would provide the necessary statutory basis for her to secure the provision of new services from a public sector operator.
The noble Lord asked whether the Bill will leave an option for the Secretary of State to procure East West Rail services from a new private sector operator, and the simple answer is that it will not. The Government have no plans for long-term private sector operation of the new East West Rail services, which will commence operation next year, nor any other services that the Secretary of State is responsible for procuring.
There are—and, after this Bill, there will remain—two ways in which other parties might operate or secure the provision of services on the rail network. One possibility is that a third party might operate them as an open access operator, as is the case with Hull Trains, for example. Another possibility is that a mayoral or combined authority or other local authority might secure the operation of services either by running them itself or by procuring a third party to do so. As I will explain in relation to the next group of amendments, the Secretary of State can facilitate this by granting an exemption under Section 24 of the 1993 Act, which takes the relevant services out of the scope of the surrounding provisions of that Act.
I noted with interest that my noble friend Lord Liddle remarked about involvement of developers, for example. I echo his sentiment that there will be ways of getting private capital in, particularly through development, that have not really been explored so far.
I hope that my explanation reassures the noble Lord, Lord Lansley, that the Government have carefully considered the implications of the Bill and the options it will and will not leave open, and I hope he will feel able to withdraw this amendment.
Amendments 5 and 6 from the noble Lord, Lord Moylan, deal with competed concession contracts. As I set out to the noble Lord in Committee, these amendments would remove the opportunity to deliver the benefits of public ownership, which a clear majority of the public support and which was a specific commitment in the manifesto on which this Government were elected. For the following reasons, I cannot agree to the amendments.
First, a concession model would mean the taxpayer continuing to fund substantial profits for private sector operators. A concession model along the lines of Transport for London’s contracts would expose operators to more financial risk than today’s contracts, where government bears virtually all the financial risk. Under such a model, train operators would price their bids to generate even more profit than the £110 million to £150 million per annum that they can earn under the current contracts. Our plans for public ownership will eliminate those fees and profits entirely—in the Government’s view, continuing to line the pockets of private shareholders is not a good use of taxpayers’ money.
Secondly, TfL concessions are a relatively inflexible form of contract which is not well suited to the needs of the national railway network. For a concession contract, the procuring authority has to define the service levels and standards at the start of the procurement process, and those levels and standards then endure for the life- time of the contract. Changes to the service specification can be achieved only through costly negotiation and agreement with the operator which already holds the contract.
That is very different from the London bus market, for example, which we discussed in Committee, where the concession model is much more suitable because there is a large number of small individual contracts. For the London Overground, much of which is heavily constrained by the geography of the railway network and the other services that run on it, it might be satisfactory, but the whole of the national railway network requires greater flexibility to adapt to changing patterns of demand. Finally, and most importantly, a concession model would not resolve the fragmentation of the current system, nor would it deliver on the Government’s commitment that rail services should be run by and for the public.
The noble Baroness, Lady Randerson, referred to devolved Administrations and local mayoral authorities. We will come to devolution further in the next amendments.
I urge noble Lords not to press their amendments.
Lord Lansley (Con)
My Lords, I am very grateful to all noble Lords who participated in this shortish debate, particularly to the Minister for the additional clarity sought by my Amendment 4.
My noble friend raised the issue of concessions, which I suspect we will come back to. It is one of those occasions where one looks at the interesting examples of what is happening in the French railway system, which is using concessions to a greater extent and is perhaps not encountering the objections that the Minister cited in relation to TfL’s concessions. That is a comparison that I am not qualified to make, but I know my noble friend on the Front Bench might pursue it.
I thoroughly agree with the point made by the noble Baroness, Lady Randerson, about the desirability of maintaining devolution models or perhaps extending them. The use of the exemptions under Section 24 should be considered. The Minister said that, in addition to the two routes the Secretary of State might use for securing the provision of services, that is the additional route, as it were, alongside open access, which we discussed in the previous group.
Lord Moylan
Lord Moylan (Con)
My Lords, if I may respond to what the Minister said, he is asking us to make a huge bet on what he refers to as the benefits of public ownership. Most of us who are of a certain age can remember public ownership, and we remember that the benefits were few and far between. He is asking us to take a leap of faith that this time round it is going to be different, but he will not—
Lord Bradshaw (LD)
The noble Lord has spoken as if public ownership is something evil. I remember, when I worked on the west coast main line, that 90% of the trains ran on time. That is a far cry from what is now the case. It was so different from what he is saying that he really should take a history lesson in what was right about British Rail.
Lord Moylan (Con)
My Lords, I made no reference to good or evil. I am talking about operational efficiency. I am sure the noble Lord is correct in drawing attention, as has happened several times today, to the deficiencies of the current operation of the west coast main line, but other noble Lords have rightly drawn attention to the fact that there are private sector operators in this country currently operating with the efficiency levels that he refers to, and better—so the private sector has a lot to be said for it as well.
The fact is that public ownership is something about which the country largely breathed a sigh of relief when we moved away from it—rightly or wrongly, whatever the history behind that might have been—and every other European country over the last few years has moved away from exclusive public ownership operation. Even train companies such as Deutsche Bahn, which stood once at the pinnacle of public regard, are now something of a joke in their own country.
Lord Watts (Lab)
It is the introduction to it that is the problem. Is it not the case that the public support public ownership of the railways, and that the public sector had to take over the east coast line because the private company failed to deliver the service?
Lord Moylan (Con)
My Lords, the noble Lord brings me to exactly my point. The benefits of public ownership that the noble Lord was able to refer to were, first, that it is popular and, secondly, that it was in the manifesto. Those two things might be absolutely true, but they are not quantifiable passenger benefits. They are not passenger benefits at all; they are political facts that sit there in the background.
Of course the system has broken down, especially since Covid. I have acknowledged that, and the need for reform. What this amendment seeks to do is allow a degree of variability, non-uniformity, difference of practice, choice, options to the Government, rather than having a single, purely nationalised, purely state-controlled machine that we are told will bring us benefits, one of which, as far as I can make out, will be flexibility.
I really did not discern any others, except that we will not be paying fees to private sector operators—a point the Minister has made several times. We will not, but in the picture of the cost of running the railways the fees are extremely small; they are a tiny percentage of what is involved. If the private sector can continue, post Covid, to generate the sort of growth in passenger numbers that it generated before Covid after privatisation, and we can get back to those happy days, the amount of money being paid to operators would be swamped by the revenues that would be coming in. That is the bar that public ownership has to match and we have no guarantees that it will do so. We are asked to take the whole thing on trust. To that extent, I wish to press my Amendment 5 and test the opinion of the House on it.
Baroness Pidgeon
“30ZA Exemption of passenger services: duty to consult(1) Before making a direct award of a public service contract to a public sector company under section 30(1A), the relevant franchising authority must consult with relevant persons on their willingness and ability to make an application to the appropriate designating authority for the grant of an exemption from designation under section 23(1) for the purposes of applying for or being awarded a public service contract under section 30(1A).(2) For the purposes of subsection (1), “relevant persons” include—(a) the Scottish Ministers,(b) the Welsh Ministers, (c) English combined authorities,(d) the Greater London Authority,(e) directly elected mayors, and(f) any other relevant persons or bodies.”Member’s explanatory statement
This amendment requires the Secretary of State to consult appropriately when awarding a public sector contract in order to encourage more services to be operated by devolved authorities like TfL or combined authorities in the future.
Baroness Pidgeon (LD)
My Lords, our Amendment 7 is about rail devolution, discussed extensively in Committee from all sides of the Chamber. We believe it is really important that this first piece of rail legislation from the new Government not only meets their manifesto commitment to public ownership of the railways but allows further rail lines to be transferred to metro mayors and local and regional authorities where there is a strong case, and a desire, by the locally elected members. Local accountability is key.
I remind the House that we have discussed in detail the huge success of the Overground and the Elizabeth line in London and of Merseyrail in the Liverpool region, and the desire for metropolitan areas such as Greater Manchester to deliver a truly integrated public transport offer, branded under one logo and accountable to the mayor. These not only improve transport but contribute to housing and economic growth. I hope that the Minister can offer some stronger words today about future devolution, not just the limited existing devolved lines. The Minister started to outline this in response to the previous group, and I hope to hear more.
We on these Benches want our railway to become a reliable, fast, cost-effective and efficient service for everyone, with local services run in a way that serves the needs of local areas and local communities. I sensed in Committee that the Minister was listening very carefully to the points that were made, especially given his direct experience in a former role of running and expanding the Overground service in London.
I thank the Minister for his time, since Committee, meeting with my noble friends to discuss our amendments further and the assurances that we would like to hear at this stage. I hope the Minister can today assure the House that, as franchises end and come into public ownership, there will be genuine consultation and discussion with devolved authorities on how future services should look, and indeed on how best to run them—including the option for locally run and accountable devolved rail services, in addition to those already devolved. We believe that this will help bring about the transformation of the railway that is the aim of this Bill. I look forward to hearing from the Minister real assurances in this area. I beg to move.
Lord Moylan (Con)
My Lords, I will speak to the amendments in this group, particularly Amendment 12 standing in my name. I have a great deal of sympathy with the amendment moved by the noble Baroness, Lady Pidgeon. Both amendments are aiming at the same thing.
I said earlier today that there are a number of crucial things missing from this Bill: one is staff, and we will come to that, and another is the passenger, and we have dealt with that. The third is the local authorities, the regions, the metropolitan authorities and devolution as a whole. On this side of the House we have always had great aspirations for the powers of combined metropolitan authorities and regional government, and for their expansion. We are largely responsible for promoting and establishing mayoralties in Manchester and the West Midlands, and in other places as well, such as Teesside and so forth. We have done that with a view to expanding their powers, and part of that was to take on a greater role in transport. We are seeing the beginning of that in Manchester with the buses, and Merseyrail is operated by the combined authority.
In doing that, we are coming from a successful metropolitan model, London, which already has many of these powers. As far as we can make out, these powers, where rail is concerned—not buses—are effectively to be closed down where they do not already exist. They will not be expanded further—the Minister has been quite clear about that—and we will not see the growth of rail on a metropolitan basis.
My Amendment 12 is simpler than that advanced by the noble Baroness, Lady Pidgeon. It would require a preliminary report that outlines the proposed framework in which Great British Railways is going to communicate with local authorities and regional authorities about passenger railway services. That it is going to communicate is something that the Government have committed to, as the Labour Party document Getting Britain Moving said so. There is going to be a great deal of consultation and involvement on every possible front, but, again, we are told that we have to take all of this on trust—that none of this will become manifest until we see the great rail Bill that will come in the future, with a bit of consultation but without seeing a proper text in advance for pre-legislative scrutiny.
We are trying to get it established now, as a principle at least, that the Government can initiate these communications before that Bill comes into effect. They can set up structures that allow those communications to take place; this amendment requires the Government effectively to do that.
If the Minister cannot agree to the precise amendment tabled by the noble Baroness, Lady Pidgeon, I very much hope that he will at least be able to agree to my amendment, which asks him to get those structures—which he envisages happening—in place as soon as possible, so that local authorities and the relevant regional authorities can be involved.
Baroness Randerson (LD)
My Lords, in response to the previous group, the Minister emphasised— I think it was in reply to the noble Lord, Lord Moylan—that the concession model would not comfortably fit national rail services. I accept that, and he made my point for me in making his response. The Government must not be allowed to create a national monolith, because one size will not fit all. Part of the variability that we should celebrate in this House is that which comes with devolution, because it fits local areas comfortably.
The Government have made a great deal of the £22 billion or £40 billion black hole and the shortage of public money. Money is undoubtedly in short supply. The Government have also made a lot of their support for devolution, but if devolution on rail transport services is to flourish then there has to be an alternative source of funding and of investment. Local authorities, even on the big scale of metro mayors, will not have the resources to invest in a pure public sector model.
Our concern in our Amendment 7 is that the Government leave themselves the scope to access or call upon alternative models of funding. That would be very much along the lines of what the noble Lord, Lord Liddle, suggested: some form of local partnership or an alternative structure, other than a pure public sector company. As my noble friend Lady Pidgeon says, we will be listening carefully to the Minister’s reply.
Lord Hendy of Richmond Hill (Lab)
My Lords, I would like to clarify a point for the noble Lord, Lord Moylan, on Amendment 13. If I inadvertently implied that the Government would somehow reduce the present freight target of 75% growth by 2050, I did not mean to. We intend that target to remain.
I will speak first to Amendment 7, proposed by the noble Baronesses, Lady Pidgeon and Lady Randerson, and I recognise the passion with which the noble Baroness, Lady Pidgeon, spoke on this. In responding to this group of amendments, let me start by saying very clearly that this Government are absolutely committed to strengthening the role of local leaders and local communities in shaping the provision of rail services in their areas. We are a pro-devolution Government. A stronger local voice is absolutely essential if the railway is to play its full part in this Government’s missions of kick-starting economic growth, breaking down barriers to opportunity and accelerating towards net zero. Our plans for reform in the substantive railways Bill will provide that stronger local voice. I can reaffirm to your Lordships’ House that the railways Bill will include a statutory role for devolved governments and mayoral combined authorities. They will be involved in governing, managing, planning and developing the railways.
Linked to this, we expect GBR to closely collaborate with areas through partnership agreements, which will build on progress made through existing arrangements the department has with the West Midlands Rail Executive and Transport for the North. We are already working with leaders in areas such as Greater Manchester, the West Midlands, the north-east and Liverpool City Region to discuss how these relationships could work, with governance supporting these discussions established. While final agreement of these partnerships will need to wait until GBR is formally established, the Government are committed to working with mayors to explore opportunities for progress ahead of GBR operation.
We are clear that together the statutory role and partnerships must allow genuine and meaningful opportunity to influence service levels and standards, and to drive forward the integration of local rail services with other modes as part of a genuinely joined-up local transport offer to passengers. It must allow for things like common branding, integrated timetabling, integration of fares and ticketing in the manner that Londoners, and people who live and work in London, completely understand. By getting this right in the wider railways Bill, we can offer local leaders the much greater level of influence that they are seeking. Existing options for local authorities to directly procure or operate their own services will remain in place, subject to the Secretary of State’s approval, as is currently the case. Alongside our proposed statutory role, our plans for the design of Great British Railways will make it easier for local leaders to engage with and influence what happens on the railway. I am so pleased that the noble Baroness, Lady Randerson, raised her dislike of a one-size-fits-all approach, and I agree with her.
First, I expect GBR will adopt a route and regional structure, with—importantly—a single leader responsible for train operations, rolling stock, staff and infrastructure within a given geographical area. This is material to the reason for public ownership and will create revenue growth and efficiencies and improve performance. A regional and route approach will ensure that GBR is close enough to local communities to understand and respond to their needs, while also being clear that they are part of a national system that needs to work coherently as a whole. It will also mean that local leaders will need to engage with just one organisation—GBR—rather than an infrastructure owner and, potentially, several different train operators.
Secondly, where local leaders wish to promote service improvements, having track and train under unified leadership will mean GBR can take a whole-system approach to identify the most cost-effective solutions. In the past, Network Rail has been much too quick—because it is an infrastructure provider—to opt for the most expensive solution, which is infrastructure change. A whole-system approach would begin by asking whether a service enhancement can be delivered with additional staff, while making better use of the existing train fleet on the existing railway infrastructure. If the answer is no, the next question should be whether the improvement can be delivered solely through changes to the rolling stock fleet. If, and only if, the answer to that question is also no, it might then be sensible to look at infrastructure change, which is usually the most expensive option and certainly takes the longest time.
The crucial point is that one organisation, GBR, on a route or regional basis, will be able to take a view across all those options with local leaders. I would encourage local leaders who think they might want to take over responsibility for operating or procuring services in their areas to keep an open mind until they have seen our full proposals for wider reform. I also reassure noble Lords that, where local leaders conclude that they wish to take over that responsibility, the current Bill does not stand in the way.
Existing legislation in Section 24 of the Railways Act 1993 allows local authorities and others to apply to the Secretary of State for specific services to be exempted from the franchising regime. Where the Secretary of State grants such an exemption, the exempted services are no longer caught in the surrounding provisions of the 1993 Act. So long as adequate alternatives are being made available, this means that the Secretary of State is no longer obliged to secure the operation of these services and they are not subject to the restriction that says they can be provided only by means of a public sector company. The relevant local authority can then operate or procure the services to its own specification, using its existing powers under other legislation, which, in the case of Transport for London, are conferred by Section 173 of the Greater London Authority Act 1999.
This is the mechanism by which services have been devolved in London and in the Liverpool City Region. The current Bill does not make any changes to the way this mechanism works. Following enactment of this Bill, the railways legislation will still provide the same opportunity as today for the Secretary of State to devolve services where she considers it appropriate and where it supports a well-functioning national service, and if we receive any such requests for the devolution of services, we will consider them openly, fairly and carefully, taking proper account of local, regional and national interests. I hope this reassures the noble Baronesses.
On Amendment 12, from the noble Lord, Lord Moylan, I thank the noble Lord for this amendment, which would require the Secretary of State to publish a report on the proposed communications framework between Great British Railways and local transport authorities across the UK. I can reassure the noble Lord that communicating effectively with local authorities is of critical importance to the Government. I have already explained that the Government are keen to ensure that local communities can influence the design and delivery of passenger rail services in their areas. We expect that GBR will engage with local transport authorities regularly on this and on key strategic matters, such as housing and economic growth.
I have also already mentioned the proposed statutory role, which will enable partnership agreements between mayoral combined authorities and GBR. The Government are already engaging with mayoral authorities to develop a framework for these partnership agreements and the intention is that the framework will enable varying degrees of influence, depending on the ambitions and institutional capability of partners. This will include close collaboration on the delivery of rail elements of local transport plans and greater opportunities for local partners to directly invest in the railway and to influence service provision.
Due to devolved infrastructure funding arrangements, my department currently has a memorandum of understanding with the Scottish Government which outlines interactions regarding the governance of Network Rail. The devolved operator, ScotRail, also has an alliance agreement with Network Rail which sees both organisations working closely together to better integrate the railway. For devolved services in Wales, there are a number of supporting devolution agreements between the department and the Welsh Government which set out the existing relationship. Under GBR, these devolved accountabilities will remain in place. We will therefore work with the devolved Governments to update existing arrangements and ensure that the benefits of establishing GBR are felt across Great Britain.
In conclusion, the report proposed by Amendment 12 is not necessary, given that the Government will be setting out their plans in a consultation which will be published shortly. This will provide not only detail on our proposals but also the opportunity for local authorities, mayoral combined authorities and noble Lords to input their views on these proposals. I hope my explanations in response to these amendments will be sufficient to persuade noble Lords not to press their amendments.
Baroness Pidgeon (LD)
One thing that has united this House in our discussions is support for further devolution and acknowledgment of the success of devolved lines in London and elsewhere in the country. I thank the Minister for his detailed response and serious consideration of the points we raised in Committee. I was really pleased to hear the words, “This is a pro-devolution Government”, because we have not heard that in the debates to date. I was also pleased to hear that the Minister will ensure that in the next legislation, the role of local authorities will be strengthened, and that he will include that statutory role to ensure their involvement in the governance, management and provision of rail services.
Transport for Greater Manchester, which my noble friend Lady Randerson met with recently, will be reassured to hear that, ahead of Great British Railways being established and on the statute book, there are opportunities for it to develop its ambitious plans for the Bee Network. What was said today about branding and being consistent in these metro areas was really reassuring, given that we want to drive a modal shift and get more people using public transport.
I was really pleased to hear the Minister say that the Secretary of State will still be allowed to exempt lines—that if local leaders want to take over a line, their request will be seriously considered and an exemption granted where appropriate to allow lines to be run across the country, as we have seen in London and Liverpool. On the basis of what the Minister has said, I beg leave to withdraw Amendment 7.
The Deputy Speaker (Lord Ashton of Hyde) (Non-Afl)
Before we move on to the next group, I have to inform the House about the voting in the third Division. The figure was announced as 99 for the Contents. The correct figure is 95, but the result is the same.
Amendment 8
Baroness Brinton
“30ZA Statement of accessibility standards(1) When making a direct award under section 30(1A) the Secretary of State must lay before Parliament a statement to the effect that they are of the view that such an award will comply with the accessibility standards.(2) The Secretary of State must prepare a statement of the standards that they propose to apply in assessing, for the purposes of subsection (1), that a public sector company meets the required level of accessibility.(3) The principles must in particular make provision for the accessibility of—(a) the service,(b) accommodation for individual journeys, and(c) booking platforms and other interactive digital services and systems used in connections with journeys on the relevant franchise. (4) In preparing the statement under subsection (2) the Secretary of State must consult such persons as they consider appropriate, in particular disabled people.”Member's explanatory statement
This amendment places a duty on the Secretary of State to make a statement to Parliament confirming they are of the view that making an award to a public sector company will meet certain accessibility standards.
Baroness Brinton (LD)
My Lords, I declare my interest as vice-chair of the Accessible Transport Policy Commission. I start by thanking the Minister for meeting with myself and the noble Baronesses, Lady Grey-Thompson and Lady Randerson, last week, for the very constructive discussions about issues relating to passenger assistance and support for disabled passengers, and for the other meeting with my Lib Dem colleagues and myself to discuss the Bill more broadly.
Before I speak to my amendment, I want to say that I support Amendment 11 in the name of the noble Baroness, Lady Randerson, which requires the Secretary of State to consult appropriately when awarding a public sector contract in order to encourage more services to be operated by devolved authorities.
Turning to my Amendment 8, I thank the noble Baroness, Lady Grey-Thompson, and the noble Lords, Lord Blunkett and Lord Holmes of Richmond, for signing it. It places a duty on the Secretary of State to make a Statement to Parliament confirming that they are of the view that an award made to a public sector company will meet certain accessibility standards. The Minister has tabled Amendment 15, which puts in legislation for the first time that public sector companies providing train services under Section 30 of the 1993 Railways Act are subject to the public sector equality duty, and I thank him for that.
One of the current issues is that it is not clear what is required by law, whether a train company is publicly owned or not. That has resulted in inconsistent standards and services. I thank all noble Lords, not just those who have taken part in the Bill but others who have spoken to me outside the Chamber, who have commented on the experiences of disabled Peers, including the noble Baroness, Lady Grey-Thompson—and myself. The fact is that our experience is not unusual, and many disabled people report disrupted or poor services daily. People are surprised when we say what has happened, but it is actually the daily experience of many disabled people.
In Committee, the Minister said:
“I was going to list a range of areas where things need to change, but I am embarrassed to do so because so many speakers in this debate have listed them themselves”.
He went on to say:
“All I can do is acknowledge that I have heard the list quite clearly. We know that we need to do better, and it hurts me that the public service that I care about fails so regularly to look after people in the way that it ought to”.—[Official Report, 23/10/24; col. 694.]
I thank the Minister for that. I repeated it because I have some questions, although not on that statement but on the detail that will follow. First, can he clarify that the public sector equality duty does not already apply to the existing OLR train operating companies? If it does not, will the current OLR train operating companies have to comply with it immediately after the Bill is enacted, but before the rail reform Bill is passed? If the answer is yes, how will that work with the next stage of consultation on a stronger assistance service?
Following remarks made in an earlier group today, can the Minister explain the next steps to consult with the disabled community about the new universal assistance standards he wanted to correct in the list of problems? It included too many apps, a lack of level boarding, broken lifts, unsuitable rolling stock, and the lack of staff on trains and at stations, which he and many others referred to in Committee. How does that fit in with the publication of the rail reform Bill, be that later this year or early next year?
Baroness Grey-Thompson (CB)
My Lords, I will speak to Amendment 8 in the name of the noble Baroness, Lady Brinton, to which I have added my name. I draw the House’s attention to my interests as listed in the register, including as chair of the Accessible Transport Policy Commission. I thank the Minister and the noble Baroness, Lady Blake, for their time in looking at this issue.
I will briefly offer my support. In speeches both in Committee and today, the noble Baroness, Lady Brinton, has made very clear what we are seeking. In Committee, there was a lot of support, not just for our own personal experiences but for the treatment of disabled people.
I spend much of my time on social media bemoaning some of the negative experiences I have had, but I will highlight one that was very positive. Today, I have already been on a return trip to Milton Keynes, which was absolutely wonderful. The train manager walked through the train and knew that I was on board. I did not use my legal right to turn up and go; I booked assistance. The train manager was there with the ramp ready and waiting, and I was in the amazing position of having three people there to meet me on the platform.
I have often mentioned that I experience way better treatment than any other disabled person I know—that was highlighted today. All we want is for the same treatment I get to be extended to every other disabled person. As the noble Baroness, Lady Brinton, said, the voice of disabled people in moving this forward is incredibly important. We also need to consider how we avoid future derogations, which I expect will be discussed in the next Bill. As a result of such derogations, instead of trains being step free on 1 January 2020, it will now be 100 years before I, the noble Baroness or other wheelchair users can get on a train without the permission or support of a non-disabled person.
I recognise where we are today. I will strongly support the noble Baroness, whatever she chooses to do with the amendment. I very much look forward to the Minister’s response.
Baroness Randerson (LD)
My Lords, I am very pleased to speak in support of my noble friend Lady Brinton and the significant group of signatories to this amendment. This eye-catching group of people campaign on disability-related issues and have made important points in this debate and others aligned with it. In addition to that amendment, which speaks for itself, there is Amendment 11 in my name and that of my noble friend Lady Scott.
Although the experiences of people using wheelchairs and those who do not have perfect sight and so on are very much at the sharp end of passengers’ experiences, the passenger body generally does not have a good experience in Britain these days. There are huge problems for passengers of every age group and every level of physical ability, so there is a massive job to be done in improving that experience. People would put up with a second-rate experience, perhaps, if they were paying second-level fares, but they are paying premium fares for a very rough deal, and those two just do not sit together.
Amendment 11 seeks to establish a body that will work on behalf of passengers: a body dedicated to passengers’ needs and to creating the kind of experience that those of us who are lucky enough to travel abroad on trains know can be achieved with a perfectly normal, non-premium rail service in other countries. If they can do it, I do not see why we cannot.
I am very pleased to see Amendment 15 in the name of the Minister, and I look forward with great interest to what he is going to say about it, because I hope it will reassure us that the Government’s plans include the creation of a passenger standards authority —or something similarly named—that will look out for passengers. I also hope that the Government will produce a commitment that suits the needs of the signatories of Amendment 8.
Lord Moylan (Con)
My Lords, I rise with some humility to make a few comments on Amendment 8, which, of course, is one where the noble Baronesses, Lady Brinton and Lady Grey-Thompson, bring an experience that cannot be gainsaid in your Lordships’ House. I said in Committee that I fully acknowledge—from my own personal knowledge—that the Minister is personally committed to seeing improvements in regard to accessibility. I know that it is a matter of importance to him, but none the less, fine words and parsnips come to mind. Action is needed and we need to see real progress. If Great British Railways offers something in that regard that has not been offered before, that would be greatly to its credit.
In relation to Amendment 11, from the noble Baroness, Lady Randerson, this is another example of what the Government could be doing now. It is already the Government’s policy to have a passenger standards authority; they have set that out in the document Getting Britain Moving. Like so many other things, it is wrapped up in a Bill that we are told we might see in 12 or 18 months. I have expressed in Committee a degree of doubt and scepticism as to whether the Government will meet that target. I hope they will, but these are very complex issues, and it could take even longer than that before we see the Bill. Then, of course, it has to be passed and enacted, and then, as I keep pointing out, it has to be implemented. Change on that scale does not happen overnight; it will take several years for it to be implemented. Where in that timeframe is the passenger standards authority going to stand? Will we see it coming to life at the beginning of the process or at the end? Could it be four or five years away before it comes into existence? We have no idea.
The amendment from the noble Baroness, Lady Randerson, would at least say, “This is one thing you can get started on now. You can get it up and running very quickly and it could be something that passengers could benefit from at a really early stage”. I really do not understand why the Government cannot accept, if it turns out that is the case, what the noble Baroness is proposing.
I have no comment on Amendment 15 in the name of the Government except to say that it is, of course, entirely unobjectionable from our point of view.
Lord Hendy of Richmond Hill (Lab)
My Lords, I will speak first to Amendment 8, which was tabled by the noble Baroness, Lady Brinton, and is supported by the noble Baroness, Lady Grey-Thompson, the noble Lord, Lord Holmes, and my noble friend Lord Blunkett, and to Amendment 15 which is tabled in my name. I thank the noble Baronesses for their amendment and for the productive discussion we had last week. As I said in Committee, I feel personally ashamed of the industry that I am so familiar with as so many deficiencies come out of the way that it treats passengers, particularly those in need of some assistance. Many of those deficiencies are a result of the fragmented structure of the privatised railway.
The noble Baroness, Lady Grey-Thompson, has shown me and described to me the plethora of apps that you need to buy tickets, the differences in how they work, what they do and whether they enable you to book a seat, a wheelchair space or a ticket for the whole of your journey. I am shocked by it, and I cannot bear for her to show me much more, because all she would do is show me more apps that work differently from those that she has already shown me. We cannot and should not tolerate that. The lack of consistency in train design has been highlighted today, as has the lack of reliable, accurate information about whether crucial facilities such as lifts and accessible toilets are working, and there are other issues.
Looking ahead to the wider railways Bill, establishing Great British Railways will provide the opportunity, for the first time in three decades, to begin to take a coherent approach to these matters. Some of them can be done quickly, some of them we can start now and some of them will, by virtue of the longevity of rolling stock and structures, take a long time, but if we do not start, we will never achieve them. However, I also agree that the noble Baronesses and the many disabled passengers on whose behalf they speak should not have to wait for Great British Railways to come along before we start to improve things, so, as I discussed with the noble Baronesses last week, the Government have tabled an amendment and we also have a number of verbal commitments that I shall place on record in the House today.
First, the Government will work with the disabled community to develop and publish an accessibility road map that will explain the actions we intend to take to improve things for disabled people or others requiring assistance in advance of GBR being set up. We are not waiting for it to do that. The road map will suggest how the Government can work with the industry to prevent situations like those we have heard about in this House so far. As discussed, it will cover important matters that the noble Baronesses have raised with me. They include measuring and reporting on lift reliability and maintenance, providing confirmation and clarity about the legal obligation of operators to provide every disabled person with assistance when travelling whether or not a pre-booking has been made, and improving consistency in the service provided to disabled people across the board. We will engage with the disabled community on the development of the road map to ensure that when it is finished, it works for them.
Secondly, I commit before the House that this Government will provide the funding to develop phase 5 of the passenger assist app. As the noble Baroness, Lady Grey-Thompson, knows from our previous discussions, I have made it clear and will continue to make it clear to those involved that the development of this next phase of the programme must be done in consultation with the noble Baronesses and representatives of disabled people to ensure that it delivers the assistance that people deserve and addresses their needs.
Finally, we have tabled Amendment 15, which is before the House today. It amends the Equality Act 2010 to make it clear that publicly owned train companies are subject to the public sector equality duty. Although it is the Government’s view that the public sector equality duty already applies to publicly owned train operating companies, we are concerned that that is currently not as clear as it needs to be. By adding them to the list of public authorities in the Act, we will ensure that there can be no mistake. Network Rail and Transport for London are already named in the Act, but train operating companies previously were not, which is something that, if this amendment is agreed, we will remedy.
Baroness Brinton (LD)
My Lords, in tabling Amendment 8, I was very aware of standing on the shoulders of giants, including Transport for All and many disabled campaigners over the years.
I thank the Minister for putting the public sector equality duty in the Bill. This is a big step forward. I thank him also for the commitments that the Government have made, albeit for the future. There is a real spirit here to make sure that things start to change. For the first time since I joined your Lordships’ House in 2011, I feel encouraged that we have been heard and understood. Amendment 15 is, we hope— I am not going to get Churchillian about this—the beginning of the end or the end of the beginning, or something like that. It will be the end of the current poor levels of assistance for passengers. I know that the Minister understands that there is much detail to be worked out to make that real change happen.
On that basis, I am happy to withdraw my Amendment 8. I look forward to seeing Amendment 15 become part of the Bill and to us seeing more detail in due course. The future higher standards of assistance services will transform the lives of disabled rail passengers. I beg leave to withdraw my amendment.
Lord Young of Cookham
“30ZA Annual report of public operator liabilities(1) The Secretary of State must lay before Parliament, within six months of the day on which this Act comes into force, and on each anniversary of that date thereafter, a report on the public sector financial liabilities arising from the award of public service contracts to public sector companies under subsection 30(1A).(2) The report published under subsection (1) must include details of rolling stock leasing liabilities.”Member's explanatory statement
This amendment would require the Secretary of State to publish an annual report examining the impact of train company rolling stock liabilities transferring into the public sector.
Lord Young of Cookham (Con)
My Lords, Amendment 9 in my name would require an annual report on public operator liabilities. This might sound rather a dry subject with which to lead the last group on Report, but it is an important one, as it has the potential to totally disrupt the Government’s ambitions for Great British Railways. I begin by thanking the Minister for the meeting that we had last week with the noble Baroness, Lady Blake. He listened patiently to my concerns and was able to allay some of them—though not, I am afraid, this one.
This amendment has grown in prominence since last week’s Budget with its clear fiscal rules, and these were needed to give confidence to the markets that the Government could borrow the substantial sums needed to fund their expenditure; we will debate all that on Monday. In a nutshell, my concern is that, if liabilities which are currently off the Government’s books cease to be off balance sheet, we will revert to the position when I was Transport Secretary, with transport bidding for investment against schools, hospitals and defence and always missing out because of political priorities.
I believe the noble Lord has conceded the risk of this happening, because he has said repeatedly that it will be for the Office for National Statistics to decide in the future how GBR liabilities impact the public sector balance sheet and, specifically, public sector net debt. However, it simply cannot be prudent for the Government to embark on a programme of nationalisation without fully understanding the financial consequences of the ONS classifying GBR as “central government” and without taking the necessary precautions.
We can have a shot at what the ONS will do, because it has stated that in circumstances such as GBR it would run what is called the market body test, and we know that GBR, as the Government envisage it being structured, would fail that test. The integration of track and train within a single entity, as set out clearly in Labour’s Getting Britain Moving document, will mean that GBR will fail the ONS market body test, meaning that its liabilities will be consolidated into the department’s accounts. The Minister has argued previously that the position will not be different from where we are now, but it will be. The creation of GBR as a permanent public monopoly will create a completely different system, which will change the way in which the ONS categorises expenditure.
The Labour document is clear that GBR will be a “single employer”. If so, it will simply fail the market test and its accounts will be classified as “central government”, rather than a public corporation, as LNER is currently. The accounts will then be required to be consolidated into DfT’s accounts, like other bodies that fail the market test, and then classified as “central government”. Crucially, these different accounting treatments will make investment, for example, in rolling stock harder, as it will be in competition with other demands for public investment. The Minister has made it clear that GBR will use its purchasing power to commission new rolling stock through the roscos: rolling stock that will then be leased to GBR. He stated:
“GBR will enable a longer-term view of the rolling stock market, and it will reduce the margins it needs to make”.—[Official Report, 23/10/24; col. 736.]
Those long-term liabilities, totalling potentially some £15 billion, will score immediately on the Government’s balance sheet, increasing national debt, even if the money to manufacture the trains comes from the roscos and is raised on the capital markets.
What I hope the Minister has done—and if he has done it, no one would be happier than me—is get an undertaking from the Treasury that, if the ONS so classifies GBR debt, the Treasury will ensure that the DfT is insulated from that decision. He may have such a letter in his breast pocket. If he has not, we know what is likely to happen because it happened to Network Rail, which was reclassified by the ONS in 2014. The Minister said at our meeting that there was scope for economies at Network Rail when it was reclassified, and I am sure he was right. But those measures were never going to compensate for all the consequences. Network Rail had to divest £1.8 billion by selling property assets; it had to defer renewal works; it had to postpone completion dates; and it had to renegotiate a lot of contracts. Do we honestly want that to happen to GBR?
So, in a nutshell, I am concerned at the gamble the Government are taking with the future of the railways by going back to the pre-privatisation system, where Ministers will have to compete against other spending departments for what the railways need. I beg to move.
Baroness Randerson (LD)
My Lords, I have one very brief question for the Minister, following the warnings by the noble Lord, Lord Young. Have the Government looked at this from the point of view not just of what I would call the finished product of the nationalised railway system but of how the categorisation of a mixed economy would work? We, the nation, will be in a situation of a mixed, some-and-some economy for a significant number of years to come.
Lord Moylan (Con)
My Lords, my noble friend Lord Young sought throughout Committee, with great forensic precision and courtesy, to get answers to the sort of questions he has been raising today, and I have sought, with rather blundering efforts, to get answers to very similar questions. Here we are on Report, still asking questions that the Government have consistently failed to answer throughout. The reason is that, as I said earlier today, this is a rushed Bill that has not been thought through properly as to its broader consequences. These are consequences not to be dealt with in a future Bill coming down the road but that flow directly from the measures in this Bill. I very much hope the Minister can give some account of them today and explain how the Bill and this nationalisation will affect the public finances in what I call, in my blundering way, balance sheet terms.
There are other items. Since we discussed this Bill in Committee, we and the country have had the body blow of the employers’ national insurance increase delivered by the Chancellor of the Exchequer. Amendment 19 in my name is there to probe what the consequences of that will be for Great British Railways. Will there be a very significant increase in staff costs on the railways as a result, and what impact is that likely to have on the revenue expenditure that the railways can undertake?
In Amendment 18, I ask for clarity on something that also flows directly from the Bill—it is a direct consequence of it, and not something to be dealt with in a future Bill—to do with the harmonisation of staff wages, terms and conditions as they transfer from diverse employers in the private sector to a single employer owned by the state. Drivers and other staff are employed by the railway companies on terms agreed with trade unions but not necessarily the same terms as between one company and another, so drivers’ pay, terms and conditions will vary somewhat between one company and another. The Government have resisted saying, at any point, what they will do about this if they are a single employer. Of course, theoretically, each franchise as it falls due will be placed in a separate company from the others, so it is perfectly possible, legally, for it to have a separate agreement with its staff, different from that which another nationalised company has with its staff, replicating the current arrangements, if it chooses to do so. Is that the Government’s intention, or is there an intention that wages, terms and conditions should be harmonised? If the latter, do the Government imagine that they will be harmonised on the basis of the lowest common denominator, the highest common denominator, or some denominator that might be found in the middle as a sort of average? This is a direct consequence of the Bill, but nothing has been said by the Minister about it.
I come back to the question of staff consultation. There has been no staff consultation about the change of employer. The idea that the Minister might wander around Waterloo station randomly consulting drivers as he accosts them, which he held out when he spoke earlier, is an attractive and enticing one. That is to be encouraged—there are not enough Ministers going around randomly accosting staff whom they employ in the public sector—but it hardly constitutes what might be called formal consultation in industrial relations terms.
I hope I am forgiven for saying this, but earlier I saw the Minister having a quiet chat in a break for a Division with his brother, the noble Lord, Lord Hendy, with his great industrial relations experience. Who knows? Perhaps he was pointing out to the Minister that normal industrial relations consultation requires a little more than simply wandering around and chatting to the staff on the station as you meet them, welcome though that is.
I very much hope that by now, with all the warning that the Minister had about these issues in Committee, he will be able to give an account of himself that will satisfy the legitimate questions of my noble friend Lord Young, and will be able to explain to us what his employment and industrial relations strategy is as a direct consequence of the nationalisations that will take place under the Bill.
Lord Hendy of Richmond Hill (Lab)
I thank the noble Lord, Lord Young, for tabling Amendment 9 and for our productive meeting the other day. I recognise that there is a question of whether public ownership will lead to certain liabilities moving on to the public sector balance sheet and therefore counting towards the public sector net debt. I cannot speculate about future balance sheet treatments and impacts as those will always depend on classification decisions that are a matter for the independent Office for National Statistics.
What I can say is that four train companies are already owned by DOHL, including LNER for six years and Northern for four, and the position has not changed so far. The Office for National Statistics recently considered the classification of TransPennine and concluded that it should remain classified as a public non-financial corporation. The mixed economy that we already have is relevant to the question asked by the noble Baroness, Lady Randerson, about the categorisation of a mixed economy. We are going to be there over the next several years as the train operations come back one by one.
It has been suggested in debate that, if liabilities move on to the public sector balance sheet, that would affect public sector net debt and unduly constrain future investment. The noble Lord, Lord Young, referred to events at Network Rail after it was reclassified, many of which I witnessed when I went there in 2015. In fact, a large number of the things that happened were really good. The organisation was not on the public balance sheet. It had spent an enormous amount of money: when I turned up in July 2015, it had debt of £54 billion, roughly equivalent to the whole of New Zealand’s national debt. With the last chief executive and the present one, we have put it into great order and reduced its expenditure. It has reduced capital expenditure too, which I think was also wise. The list of enhancements that it was proposing to carry out were beyond its capability then, and beyond the funding of even the unlimited amounts of debt that it could call on.
Nevertheless, the existing publicly owned train operators are the driving force behind the current multibillion-pound pipeline of new rolling stock orders. Network Rail is still investing in the railway infrastructure, and it shows that public ownership need not be a barrier to investment.
Looking more broadly across the public services, noble Lords may have seen that, alongside the Budget, the Chancellor announced changes to the fiscal rules to measure government debt in a way that recognises the need to better support capital investment. This Government recognise the pressing need to rebuild our economy and invest in our public services after years of underinvestment.
It might be helpful to provide the noble Lord, Lord Young, with some specific reassurance, and I can reassure him that we are not seeking to close the door on private investment. Where there are genuine opportunities for private investment—which, for example, might well be, and in the future should be, in relation to property development around stations or car park investment—we would expect Great British Railways to work with relevant local authorities and the private sector to promote these opportunities. I reassure the noble Lord that securing appropriate private investment will be an absolute priority for this Government. I hope that provides him with enough reassurance to withdraw the amendment.
Next, I will address Amendments 18 and 19 in turn. I thank the noble Lord, Lord Moylan, for these amendments. Amendment 18 would require the Secretary of State to lay a Statement before Parliament within three months of the Bill’s enactment. The Statement would need to set out the Government’s intentions concerning the terms, conditions and pay rates of staff of existing train operating companies as they transfer to become employees of public sector companies.
At that stage, it would be a very simple Statement. The Government fully expect that the TUPE regulations will apply, preserving employees’ existing contractual terms and conditions as they transfer from private operators to subsidiaries of directly operated holdings, in the same way as they have done in previous transfers. I can also confirm that the Secretary of State’s contracts with public sector companies would ensure that staff could continue to be members of the railways pension scheme. That being the case, there is no need for a further Statement of the kind mandated by the amendment.
The noble Lord asked what the Government intend should happen to pay, terms and conditions in the period after employees have transferred to a public sector operator. Although this is beyond the scope of the amendment the noble Lord has tabled, I am happy to address the question by saying three things.
First, public ownership under this Bill does not give rise to any imperative to harmonise or otherwise amend staff terms and conditions. Decisions about any such changes are for the future. In contrast to the previous Government’s approach, we would expect to discuss these matters openly and constructively with the workforce and their representatives before settling on any specific proposals. If the noble Lord was serious in his proposal, he would be able to tell me, for example, that the previous Government consulted the staff of LNER when it was transferred into the public sector. I think he will find that they did not. I am not going to speculate about the outcome of any such future discussions.
Secondly, resolving the long-standing disputes with the rail unions, as we have done and are doing, clears the way for vital workforce reform to modernise our railways and do away with outdated working practices. We do not need to wait for Great British Railways to start this essential work—although we have needed to clear up a number of disputes, including one so long-standing that it has been a dispute since 2015—and we will do this by working with the workforce, not against them.
Thirdly, looking further ahead to Great British Railways, the overall structure for GBR and the mechanics of how staff will transfer into it are still to be decided. We will want to make sure that GBR retains and treats fairly the committed and talented staff who are essential to keep the railway running for its customers. We will have more to say about this when we publish our proposals for the railways Bill.
Amendment 19 would require another report, this time on the impact of national insurance employer contributions on the operational costs of public sector companies. I am sure that the noble Lord will recognise that employer national insurance contributions are just one relatively small component of train operators’ overall costs—less than 2.5% of total costs in this financial year. Furthermore, other significant costs, such as diesel and electricity, are volatile. It would therefore take significant resource to routinely report on all these different costs, which are subject to change all the time.
This reporting would add little value, particularly when any national insurance costs incurred by a DfT-contracted operator are simply paid to another part of government. Public ownership will make no difference to the net cost to government of the relevant train operators’ employer national insurance contributions; the Government are already both the funder and the recipient of these.
Having said that, I will be pleased to provide an estimate of any impact as soon as I am able to. At that point, I will happily write to the noble Lord and place a copy of the letter in the House Library. In the light of this, I urge the noble Lord, Lord Moylan, not to press his amendments.
Lord Young of Cookham (Con)
My Lords, as this is the last debate and possibly the last speech on Report, I commend the Minister for the patient way he has dealt with the proceedings on Report, drawing on his unique knowledge of the industry we are debating. It has been a pleasure to watch the contrasting debating styles of him and the more flamboyant style of my noble friend Lord Moylan.
I welcome what the Minister said about private investment, but I have to point out that the Bill specifically precludes the sort of investment we saw with the franchise. For example, Chiltern widened single track into double track and built new railway stations. That sort of investment by a train operating company is specifically precluded by the Bill.
On the substance of my concern, he said right at the beginning that there is a question about how the liabilities will be classified. He then sheltered behind the well-known phrase that he “could not speculate” about what the ONS will do. I think there is a distinction between the present position with LNER within the department, with relatively short-term liabilities for rolling stock, and the position with a 20-year liability and GBR. I remind the Minister that, in order to avoid Network Rail being reclassified as public sector body, Treasury Ministers specifically asked—this is under the Labour Government—other Ministers not to criticise the salaries of Network Rail for fear that the ONS would classify it as a public body.
Having said that, the Minister has gone as far as I could have expected him to. He does not have in his breast pocket a letter from the Treasury giving him a guarantee against the consequences of reclassification, but against the good-natured reply he gave me, I seek leave to withdraw my amendment.
Lord Moylan
“30D Preliminary Report on Communication with Local Transport AuthoritiesThe Secretary of State must, within six months of the day on which the Passenger Railway Services (Public Ownership) Act 2024 is passed, publish a preliminary report outlining the proposed framework for communication between Great British Railways (GBR) and local transport authorities across the United Kingdom.”
Lord Moylan (Con)
My Lords, this amendment deals with devolution and requires the Government to start work on that in the next few months and explain how they are going to do it. One thing that is new today, as far as I am aware and I have listened fairly carefully to all parts of this debate, is that the Minister has said that he intends to issue his consultation document before the end of this calendar year. Did my ears hear that correctly?
Lord Moylan (Con)
On the basis of that “hope”, which I imagine the Minister will expect to be held to—and which I will be holding him to—I am prepared not to move this amendment, because it will simply be timed out by that consultation document which would replace it, so to speak.
Lord Moylan
“30D Statement on the impact of the Act on rail freight targetThe Secretary of State must, within six months of the day on which the Passenger Railway Services (Public Ownership) Act 2024 is passed, make a statement in each House of Parliament outlining how the Government’s plans to achieve a 75% increase in the volume of rail freight in the United Kingdom by 2050 are affected by the provisions of that Act.”Member's explanatory statement
This amendment would require the Secretary of State to make a statement outlining the Government's plans to take all reasonable steps to achieve a 75 per cent increase in the volume of rail freight in the United Kingdom by 2050.
Lord Moylan (Con)
I am afraid the case is rather different in relation to Amendment 13, which relates to freight and requires the Government to state not simply that they intend to meet the 75% target for the increase in freight volumes but how they intend to do so. It remains wholly mysterious how the Government are going to do this, and it is time that that veil should be drawn back and we should be allowed to know. This amendment would require them to do that. I wish to test the opinion of the House on Amendment 13.
“Application of public sector equality dutyIn Part 1 of Schedule 19 to the Equality Act 2010 (authorities subject to public sector equality duty), at the appropriate place under the heading “Transport”, insert—“A public sector company providing services for the carriage of passengers by railway under a public service contract awarded under section 30 of the Railways Act 1993 (public sector provision of services).””Member’s explanatory statement
This amendment provides for public sector companies providing train services under section 30 to be subject to the public sector equality duty.
Passenger Railway Services (Public Ownership) Bill
Wednesday 13th November 2024
(1 week, 1 day ago)
Lords ChamberRead Full debate Passenger Railway Services (Public Ownership) Bill 2024-26 Read Hansard Text Watch Debate Read Debate Ministerial Extracts Amendment Paper: HL Bill 21-R-I Marshalled list for Report - (4 Nov 2024)
The Minister of State, Department for Transport (Lord Hendy of Richmond Hill) (Lab)
My Lords, I am hugely grateful for the robust and detailed scrutiny from all sides of this Chamber on what is an important and landmark Bill. The Government were clear in their manifesto commitment to bring passenger services back into public ownership, and we shall not pass up the opportunity to do so. We have taken a significant step towards achieving this over these last weeks. Six and a half years after the timetable crisis of May 2018, I am delighted that we have finally begun the process of reforming our railways.
I shall briefly update the House on the position of the devolved Governments. There has been constant and constructive engagement undertaken to date with both the Scottish and Welsh Governments, in keeping with this Government’s commitment to reset the relationship with the devolved Governments. I am pleased to confirm that the Motion has passed each respective Parliament. This demonstrates the unified belief in the necessity and relevance of this Bill.
I thank all colleagues involved in this process. It has been a privilege to take this Bill, one of the first major pieces of legislation for this Government, through this House. On a personal level, I am grateful to be part of the process to improve the industry, which can deliver so much for growth, jobs, housing and the Government’s missions, and to which so many are vocationally committed.
I owe thanks to my noble friend Lady Blake, who so admirably and impressively stepped in to act on my behalf for the Bill’s Second Reading. Her guidance and support on the Front Bench have been of great help.
We will finally have trains that are run for the public by the public. The Secretary of State for Transport said in the other place that her aim is to move fast and fix things. The Bill is the first step towards unravelling a failing, fragmented system and instead places the interests of passengers and freight front and centre. There is a lot of work ahead, and separate legislation will be introduced later to address the much-needed wider reforms. I extend my gratitude to a number of noble Lords who have dutifully engaged with and examined the Bill.
I congratulate the noble Lord, Lord Moylan, on his substantive appointment as the shadow Minister and on his unique and effective style of questioning. It is by no means the first time the noble Lord and I have worked together; he will recall in particular election night in 2010 when, under his and the previous Mayor of London’s political direction, we joyfully took Tube lines back into public ownership—another example of a failed transfer of public assets, in that case to a public/private consortium. However, I should remind him that we needed no reports or further constraints in making the Tube better as a result. We both knew that public ownership itself would bring greater accountability and improvements in performance, and in order to achieve that the noble Lord himself was appointed chair. I hesitate to mention it, but it was a direct appointment without competition. I have no doubt that the noble Lord will feel a similar sense of triumph today as this Bill passes to the other place.
I pay tribute to his colleagues, the noble Lords, Lord Gascoigne, Lord Lansley and Lord Young of Cookham, and I thank them greatly for their most constructive and courteous engagement. I am grateful to the noble Baroness, Lady Randerson, for her valued contribution, and I thank the noble Baronesses, Lady Pidgeon, Lady Scott of Needham Market, Lady Finlay and Lady Jones of Moulsecoomb, and the noble Lord, Lord Bradshaw, for their input in the Chamber and our separate meetings. The noble Lord, Lord Bradshaw, has of course seen it all and is a great champion and mentor for a joined-up, coherent railway.
I place on record my gratitude to the noble Baronesses, Lady Brinton and Lady Grey-Thompson. Their powerful contributions to the debates were moving, thought provoking and essential. I will not take lightly what they have shared in this Chamber. My hope is for us together to build the passenger experience for many, including the disabled, into a source of shared pride rather than a confidence-sapping lottery.
I say to my noble friends Lord Sikka, Lord Liddle, Lord Berkeley, Lord Snape, Lord Tunnicliffe and Lord Hanworth that their wisdom is hugely beneficial, so I extend my thanks to them for sharing it and for their counsel. Additionally, I thank all the officials who have supported me, especially the Bill team, who have worked so hard. Their names are Emma, Matt, Sophie, Heidi, Dani, Emily, Tom, Gabriel and Marisa, and I thank them all. Finally, I thank the Lord Speaker and the parliamentary staff.
This Bill is the first step in changing the culture of the railway and how it works in order to put passengers and freight back at the heart of the system. Only by these means can we start the great process of the reform of our railways to deliver passengers and freight better across Great Britain. I beg to move.
Baroness Randerson (LD)
My Lords, I thank the Minister and his team, who have been exceptionally generous with their time in offering advice and assistance on the Bill. The Minister has been willing to give many of the details that we sought about the much-anticipated big Bill that we expect next year.
In addition, the Minister offered an important amendment to the Bill, which he has just referred to, on disability access. That was in response to an amendment in the names of my noble friend Lady Brinton, the noble Baroness, Lady Grey-Thompson, and the noble Lords, Lord Blunkett and Lord Holmes. These new legal obligations will have significant implications for train operators and the rail network generally, and we are very grateful for that commitment, which will make a real difference to the lives of people with disabilities.
From these Benches, we have made it clear that we would not have adopted the same approach as the Government. We would not have divided the issue of ownership from the details of how the system will be organised and how the parts will fit together. The Secretary of State stated on Monday, absolutely correctly, that nationalisation is no silver bullet. In essence, most of the amendments that were put forward, both from our Benches and from the Conservative Benches, simply sought more information on how it would work and where the powers would lie.
As Liberal Democrats, beyond our concern about disabled access, we wanted assurances that passengers would be at the heart of the reforms and that devolution would not just be tolerated but be allowed to grow. We appreciate that the Minister did his best to reassure us on those issues; in particular, he moved some way on devolution. We therefore look forward with enthusiasm to the big Bill, when we can promise him very thorough scrutiny.
I remain sceptical that the Government have the answers to everything; for instance, whether they will genuinely be able to accept private sector operators under a public/private partnership scheme within devolution. I also have reservations about the cost to passengers of the harmonisation of terms and conditions for staff. But I always accept that the Minister understands his brief comprehensively and is absolutely in good faith in his assurances.
We send this Bill back to the other place with the amendments that were passed against the wishes of the Government and are strongly aware of the Government’s majority in the other place. We are realistic about what will happen, but I say to the Government that it would do their cause no harm to accept the good intentions of the first amendment that passed here, which simply stated that it is the duty of the Secretary of State to improve passenger standards. That is, or should be, a statement of the obvious. I hope they might consider bringing forward an amendment of their own on that.
Finally, I thank my colleagues on these Benches for their support and contributions: the noble Baronesses, Lady Brinton, Lady Pidgeon and Lady Scott, and the noble Lords, Lord Bradshaw and Lord Teverson. Finally, I must thank Elizabeth Plummer, our legislative adviser, who was responsible—as always—for excellent advice and for amendments from these Benches.
Lord Moylan (Con)
My Lords, before I turn to the substance of the Bill, and in response to what the Minister said, I remind noble Lords who may have forgotten that the remarkable thing about election night in 2010 was that it initiated a period of approximately a week in which, in effect, the country had no Government at all. Labour had lost and the victors were locked in some room in Whitehall trying to work out terms of their agreement. In those circumstances, there was nobody to stop us doing what we did to Tube lines; it shows that you can move fast and fix things when you get the opportunity.
I am very grateful to the Minister for the courtesy he has shown me outside the Chamber as he has given me assistance in relation to this Bill and for the patience he has shown inside the Chamber. It is always difficult for a new Minister when dealing with a Bill which is open to such criticism, but he has handled it with great good grace.
I am also grateful to the Minister’s officials whom I have met and who have offered me advice and briefings. On our own side, I received support in our Opposition Whips’ Office from Abid Hussain and Henry Mitson, and I am very grateful to them. I am also grateful to all noble Lords who spoke in debate in considering this Bill. I shall not attempt to name them; the Minister has already mentioned their names. We had a very good series of debates on this Bill.
None the less, it is not a good Bill. Everyone agrees that the railways need reform. The privatisation model has produced record growth in passenger numbers. There has been a true rail renaissance over the last 25 or 30 years in this country, but the railway has not recovered from the effects of Covid on its operations and reform is definitely needed. The basis of that reform appeared to be the Williams review, which gained a wide measure of cross-party support. It envisaged an important role for private train operating companies but on a different financial and operational model from the existing privatisation model.
Labour has broken that consensus. Why? It is hard to tell, but it is noticeable that the rail unions have been pushing hard for full nationalisation, which will of course increase their power and leverage over the travelling public. Labour now owns the train set and can call the shots. I suspect it will fall to the Conservatives to fix it again when it all goes wrong, as in 2010, on election night, it fell to a Conservative mayor to fix the problems created for London Underground by Labour’s disastrous PPP.
However, the Bill now goes forward to the Commons greatly improved. As the noble Baroness, Lady Randerson, said, it would be churlish and wrong of the Government to refuse to accept those amendments or some variation on them. If we see it back here at all, I hope it will be rather different from how it was when it first came to us.
Passenger Railway Services (Public Ownership) Bill (Programme) (nO. 2)
Tuesday 19th November 2024
(2 days ago)
Commons ChamberRead Full debate Passenger Railway Services (Public Ownership) Bill 2024-26 Read Hansard Text Amendment Paper: Commons Consideration of Lords Amendments as at 19 November 2024 - (19 Nov 2024)
Passenger Railway Services (Public Ownership) Bill
Tuesday 19th November 2024
(2 days ago)
Commons ChamberRead Full debate Passenger Railway Services (Public Ownership) Bill 2024-26 Read Hansard Text Watch Debate Read Debate Ministerial Extracts Amendment Paper: Commons Consideration of Lords Amendments as at 19 November 2024 - (19 Nov 2024)
14:53 - The House divided: - Ayes: 344 / Noes: 172 - Question accordingly agreed to.
15:06 - The House divided: - Ayes: 350 / Noes: 108 - Question accordingly agreed to.
Madam Deputy Speaker (Ms Nusrat Ghani)
I must draw the House’s attention to the fact that financial privilege is engaged by Lords amendment 2. If that Lords amendment is agreed to, I will cause the customary entry waiving Commons financial privilege to be entered in the Journal.
Before Clause 1
Purpose: improvement of passenger railway services
The Secretary of State for Transport (Louise Haigh)
I beg to move, That this House disagrees with Lords amendment 1.
Madam Deputy Speaker
With this it will be convenient to discuss:
Lords amendment 2, and Government motion to disagree.
Lords amendment 3.
Louise Haigh
I am delighted that the Passenger Railway Services (Public Ownership) Bill has returned to this House. I thank Members of both Houses for their careful scrutiny, and I commend the collaborative, cross-party approach taken during the passage of the Bill to date. I place on record especially my thanks to the Rail Minister, Lord Hendy of Richmond Hill, and to Baroness Blake of Leeds for their valuable support and for leading the Bill so expertly through the other place. Three amendments were made there that we will seek to address today in this House.
Before I speak on the amendments, I remind both Houses that the Government were elected on a manifesto commitment to bring franchises for train services back into public ownership where they belong, in line with the wishes of a clear majority of the British public and in direct response to the failure of the previous Government.
Public ownership will end the gravy train that sees the taxpayer footing the bill for more than £100 million each year in fees to private operators, which ultimately benefits their shareholders, not passengers and not the taxpayer. It will allow us to strip out inefficiency and waste and will pave the way for the creation of Great British Railways, ending the fragmentation of the failed franchising system and bringing together responsibility for track and train under single, unified leadership with a relentless focus on those who use the railway. I made a statement to the House only last week setting out the early progress that we have made in fixing our railways. There is a long way to go in restoring public confidence and pride in our railways after years of failure, but the journey has begun.
I will briefly set out the Government’s position on the two non-Government amendments that were made to the Bill in the other place. Lords amendment 1 seeks to insert a purpose clause in the Bill and to require me to have regard to it. I am sure that the amendment is well intentioned, and I am delighted that after years of declining performance the Conservative party now recognises that reliability and punctuality actually matter to passengers. I am more than happy to reassure the House that improving the performance of the railways is at the top of my priority list, especially in view of the mess inherited by this Government. I really do not need a purpose clause to remind me of that. In my first few months in office, I have spent my time making sure that railway leaders pay much more attention to punctuality and reliability than they have in recent years.
As well as being unnecessary, Lords amendment 1 is misleading and potentially harmful, because it picks out improving the performance of passenger rail services as the sole purpose of the Bill. If that was really its sole purpose, the best thing we could do would be to cut train services from the timetable; the easiest way to make trains run on time is to run fewer of them. I hope that hon. Members on all sides of the House can agree that that would be absurd. Improving performance is of course a vital objective, but it is certainly not the only one. From saving millions of pounds each year in fees to private operators and stripping out inefficiency and waste to simplifying the arcane fares and ticketing system and making rail services more accessible, all those things and many more are priorities that we will address through public ownership and our wider plans for rail reform. The Government therefore cannot support Lords amendment 1, and I urge the House to oppose it.
In my opening remarks, I set out for the House the urgent need to deliver meaningful change. In view of that, the Government cannot accept amendment 2. The practical effect of the amendment would be to delay the programme of transfers into public ownership and prolong the failed franchising system that has inflicted so much misery on passengers. Delaying the transfers would mean deferring the benefits of public ownership, as well as the taxpayer having to pay millions of pounds more in fees to private operators. Clearly, the Government cannot accept that, especially given that we promised the electorate we would manage the transfer without unnecessary cost. The additional cost to the taxpayer is why the amendment triggers financial privilege, as the House will see on the Order Paper and as you have laid out, Madam Deputy Speaker.
I have also made it clear numerous times that this Government will not put up with the appalling standards of service previously tolerated for far too long. Passengers and our constituents deserve much better. I have heard loud and clear the calls for the poorest-performing services to be brought into public ownership first. I understand those calls and deeply regret that the contracts we inherited from the previous Government make it very difficult to do that, but sadly that is the position we must start from.
We have made it clear that we will bring services into public ownership as existing contracts expire, which will allow us to end franchising entirely within three years and, crucially, avoid the need to pay compensation for ending those contracts early. I assure the House that the Rail Minister and I are monitoring the compliance of train operators with their contracts like hawks. If an operator’s performance is poor enough to trigger a right to end its contract early, we will not hesitate to exercise that right and bring its services in-house at the earliest possible opportunity. We will continue to hold operators’ feet to the fire to ensure that they deliver better for passengers. Our plan to bring services into public ownership as existing contracts end is the right plan and the only responsible one. Lords amendment 2 would wreck that plan, and I urge the House to reject it.
Finally, the Government were pleased to table Lords amendment 3 in response to powerful contributions by Baroness Brinton, Baroness Grey-Thompson and others who spoke on behalf of the many disabled people who use our railways. I echo the Rail Minister’s comments in response to that debate. The railways have not done enough to meet the needs of disabled people. We simply must do better, and we will. Lords amendment 3 sends a very clear message by making it explicit in the Equality Act 2010 that publicly owned train operators are subject to the public sector equality duty.
Lords amendment 3 was accompanied by two verbal commitments by the Rail Minister, which I am happy to reiterate for the House. First, the Government will work with representatives of disabled passengers to develop
“an accessibility road map that will explain the actions we intend to take to improve things for disabled people or others requiring assistance in advance of GBR being set up.”—[Official Report, House of Lords, 6 November 2024; Vol. 840, c. 1550.]
Secondly, the Government will now fund the next phase of improvements to the passenger assist app, which is to be delivered in close collaboration with disabled passengers.
Lords amendment 3 was universally supported in the other place, and I am grateful for the constructive discussions that have taken place in relation to it. I am confident that we can continue to work across parties to improve accessibility on the railways, and I urge the House to support the Government’s position today.
Madam Deputy Speaker (Ms Nusrat Ghani)
I call the shadow Secretary of State.
Gareth Bacon (Orpington) (Con)
I thank the other place for providing these amendments. Although the measures in this Bill are not a surprise—and we have stated our opposition to its fundamentals from the outset—we have made the case that, in effectively nationalising the operation of our passenger railways, we risk going backwards. Its core provisions will mean that the progress made on passenger services since privatisation will not be carried on.
That said, we do agree that there is a need for reform, and we support the reform laid out in the Williams-Shapps review. But the reforms proposed by this Government go too far and will undermine any potential progress. That is why the Lords amendments we are discussing are of central importance. Neither of the two amendments passed in the upper House descend from the Government’s intention to bring the franchises into public ownership, and they are clearly reasonable and measured. As the noble Lord Moylan pointed out, a
“glaring omission from the Bill is, of course, the passenger.”—[Official Report, House of Lords, 6 November 2024; Vol. 840, c. 1510.]
This is the Passenger Railway Services (Public Ownership) Bill, yet it says nothing about the passenger.
Lords amendment 1 attempts to put that right and put the passenger back at the head of the Bill as the driving force in what the Government are trying to do, and to require Ministers to test their actions under the Bill against the standard of whether it will improve matters for the passenger. It clarifies that the Secretary of State
“must, in taking any actions under the provisions of this Act, have regard to this purpose”,
which is the
“improvement of passenger railway services”.
It is a simple but deeply important amendment that will ensure that the Bill, which is little more than an ideological undertaking if it lacks the proposed amendments, would be required to act unambiguously in the service of passenger railway improvement. How could anyone oppose that? There is little public appetite for ideological measures that are not based on the improvement of the passenger experience, and to reject this amendment would be a tacit admission that the Government are rejecting the principle that legislation directed at the passenger services should be in line with service improvements. In doing so, they would reject the general public consensus. I urge the Government to support the amendment on those grounds. If they choose to reject it, it is incumbent on them to explain why they have decided to make a significant legislative change to our passengers’ railways that could risk worsening services.
Lords amendment 2 contains a simple measure: to ensure that the Government, when terminating existing franchise agreements, consider operational performance and terminate the worst-performing franchises first, enabling franchises that are currently working well to continue. That would clearly be in the best interests of passengers.
Gareth Snell (Stoke-on-Trent Central) (Lab/Co-op)
Can the shadow Minister tell me how much that proposal would cost taxpayers? Given that he supports the amendment, I presume he has a detailed financial breakdown of exactly how much money he is asking the state to commit.
Gareth Bacon
The point of the amendment is to put passengers at the heart of the decision making we are asking for. [Hon. Members: “How much?”] The point of the amendment is to put passengers at the heart of the decision making, and the proposed amendment would ensure that this legislation is in the service of improving passenger experience, not purely in the service of fulfilling an ideological undertaking.
Lords amendment 2 would also ensure that the Government, alongside stakeholders, consider carefully what performance data is most relevant to passenger experience, and would ensure that that data is taken into consideration when undertaking the actions facilitated by the legislation. I fail to understand why the Government would be opposed to such a clearly reasonable protective measure, but I can guess. In justifying this ideological legislation, the Government have made clear their intention to utilise selective performance data. Rather than clarifying the relevant performance information for its own administrative use or for passenger understanding, they are obscuring it, allowing the Government to fulfil an ideological project untethered from the public’s wish to see their experiences on the railways improved.
Of course, the Government could choose to put politics aside and support the amendment, and we call on them to do so. If they did, that would signal that while they are undertaking this ideological rail project, they are also seriously considering the need for the legislation to make an actual improvement to passenger experience. This amendment will help the Government’s actions, and it is not founded on selective principles. A failure to accept the proposed amendments will also fail to ensure that the ideological measures being undertaken by this Government take into account the needs and experiences of passengers.
Andy McDonald (Middlesbrough and Thornaby East) (Lab)
Will the shadow Minister give way?
Gareth Bacon
I am just winding up.
Such a failure will only further the approach—already taken by this Government—of prioritising political convenience over substantive action. We urge the Government to support these amendments and, in doing so, mitigate the negative impacts of their legislation and work to protect and support passengers.
Andy McDonald
Madam Deputy Speaker, you will perhaps be relieved to know that I will not detain the House particularly long. I rise to support the Government, but also to say something in favour of the motion in the Secretary of State’s name relating to Lords amendment 2.
I read the Lords debate on their amendments 1 and 2, and I sympathise with the notion that passengers receiving the poorest service from a train operating company may wish its franchise to be terminated early. However, the point of this Bill is not simply to take over the worst franchises, but to recognise that the private operation of the passenger rail service has delivered a poorer service for passengers in general, and that the remedy is to return all passenger franchises to public ownership and closer control.
I say to Conservative Members that the British public spoke on this issue at the last election. If we look at any of the research and analysis on the passenger rail service, it is abundantly clear that not only do the vast majority of the British public want to take our railways back into public ownership and control, but the majority of Conservative supporters want the same thing. Perhaps that tells us a great deal about why the party opposite is the party opposite—why Conservative Members no longer sit on the Government Benches.
The hon. Member for Orpington (Gareth Bacon) made many references to ideology. I do not know how many times he mentioned the word, but I ask him to cast his mind back to the Railways Act 1993: if ever there was an act of ideology, that was it. John Major took a step that even she whose portrait must be removed was not prepared to take—she recognised that it was a ridiculous step to take. I suspect that the mover of the motion in the other place was seeking a device to disrupt the orderly transfer of passenger rail back into public ownership, which is best achieved with the least cost to the taxpayer by doing so as each franchise contract expires.
I am heartened to hear Conservative Members be so evangelical about the issues of performance and punctuality. Where were they for the past 14 years? Why were they not doing anything about those issues?
Mr Snowden
The hon. Member has mentioned removing franchises based on performance and passenger satisfaction, but c2c—which operates with a 94% passenger approval rating—will be one of the first franchises to be removed. I actually think that Lords amendment 2 is quite sensible, in that it looks at how we prioritise. Some franchise operators operate very well-recommended and well-approved services.
Andy McDonald
Perhaps the hon. Gentleman would like to tell us where he thinks the dividends go when they ship out of the system. The Conservative party was quite content to see massive dividends paid out to Abellio, Nederlandse Spoorwegen, Deutsche Bahn, and every other nation state on the planet that could subsidise its own transport system because of the ridiculous system imposed on this country’s railways by the Conservative party. Rather than serving passengers and performance, what we got was money shipping out of our system for decades, subsidising other nation states’ transport systems—if that is not a good example of barmy ideology, I do not know what is. We are correcting that, and rightly so.
The Minister in the Lords, my noble Friend Lord Hendy, said that
“the Government do not believe that we should either pay compensation for termination or keep paying fees to owning groups of train operating companies when we do not need to.”
He also clarified that some contracts may end early if their performance requires it:
“if we have the opportunity to put passengers out of their misery by ending a failing operator’s contract early and bringing their services into public ownership, we will do just that.”—[Official Report, House of Lords, 6 November 2024; Vol. 840, c. 1519.]
The Government are clear that they are moving ahead with restoring passenger rail to public ownership. They have a clear plan to do so, but Lords amendment 2 creates obstacles to doing that. It is not in the interests of passengers, and I hope the House will throw it out when we vote later.
Madam Deputy Speaker (Ms Nusrat Ghani)
I call the Liberal Democrat spokesperson.
Mr Paul Kohler (Wimbledon) (LD)
Our current railway system is simply not fit for purpose, and I know I speak for everyone in this Chamber when I say that has to change. If we are serious about growth, we have to get serious about rail. After years of Tory neglect, we must get our network back on track and put the passenger first. Across the world, there are examples of both publicly and privately owned train companies that do exactly that. Because of that, we need not be ideological about ownership; rather, we can take a pragmatic approach. That is why the Lib Dems have been, and remain, agnostic about the ownership model adopted.
As the Government have themselves admitted, nationalisation is not a silver bullet. It will not automatically deliver cheaper fares, a more reliable and frequent service, or a better passenger experience. While nationalisation might offer economies of scale, it comes with new dangers—those of us in this Chamber old enough to remember the travails of travelling on British Rail are unlikely to become misty-eyed at the prospect of going back to that future, although we might well shed a tear.
In short, nationalisation alone will not fix the mess that the Government inherited from the Conservatives. The devil, as so often, is in the detail, and I eagerly await publication of the forthcoming rail reform Bill, which we will scrutinise keenly to ensure that it does not succumb to the same demons that held back rail in this country for decades, whether it was in public or private hands.
Jacob Collier (Burton and Uttoxeter) (Lab)
I rise to support the Government motion to disagree with the Lords amendment. Britain’s railways are not working as they should, and nowhere is this clearer than in my constituency of Burton and Uttoxeter. Communities such as ours have faced delays, cancellations and limited services. In Uttoxeter, Sunday trains do not run until 3 pm, leaving passengers stranded or having to resort to driving to their destination. In Burton, high fares and overcrowded trains are a daily frustration. On some services, it is so difficult to get a seat that it is a bit like being a Labour MP at Prime Minister’s questions. We can and must do better.
This is not an isolated issue; it is the direct result of decades of privatisation—a model that promised efficiency, but delivered fragmentation and sky-high costs. It has left passengers paying some of the highest fares in Europe, all while billions of pounds flow into the pockets of private shareholders, instead of being reinvested in better services. Our commitment to bringing rail franchises into public ownership is the first step towards reversing this failure. Public ownership will allow us to reinvest £1.5 billion a year back into the system. That money will improve services, reduce fares and modernise our ageing infrastructure. That is about not just the system but the people it serves. Public ownership means that passengers will have a real say. An accountable passenger standards authority will give local people a voice in how their railways are run. My constituents want more frequent services and affordable tickets, and they want to know that when they wait for a train, it will actually turn up. Public ownership gives us the chance to listen to concerns and act on them.
Cutting fares and investing back in the railways is not just about convenience; it is about connecting people to jobs, education and opportunity. For every £1 spent on the railways, the economy gains £2.50. That money goes straight into creating jobs, supporting local businesses and boosting regional economies. Fixing Britain’s railways is about more than just trains and timetables. It is about building a system that works for people, not profit. This Government’s plan for public ownership puts us on the right track. Now we must go further by investing in infrastructure, lowering fares and ensuring that communities such as mine are no longer left waiting on the platform.
Madam Deputy Speaker (Ms Nusrat Ghani)
I remind colleagues that their contributions should relate to the Lords amendments.
Mr Snowden
I want to speak to Lords amendment 2. I will briefly make a few points first, but I fully understand that I should not go through the debate we have already had on this Bill. That debate was about Conservative Members’ belief that we will drive improvement in the railways by putting the passenger at the heart of things, and by ensuring greater competition and private sector investment, while the Labour party argued through its manifesto that it can do that through the nationalisation of rail. We have had that debate, but Lords amendment 2 is about pragmatic ways in which the proposals can be better implemented, with the passenger at the heart of them. I fully accept that we are not having the debate over again; in fact, it is quite refreshing to see the Labour party not breaking one of its manifesto promises, but instead actually pushing on with the Bill.
As I said in my intervention, c2c has a 94% passenger satisfaction rate, but it is one of the first franchises that would lose its licence. Labour’s Lord Snape said on 6 November that it would make no sense to remove a franchise such as the Greater Anglia one, which has great public support for the way in which it operates its services. In response, the Minister said that amendment 1 would not make sense, because we could simply play the game of targets. However, the Government can play the game of targets whether or not the amendment is made. It does not really matter whether the Government can stack targets or cut data a certain way. We need to call things out, and put passengers and improved services at the heart of the Bill. Lords amendments 2 and 1 are pragmatic steps to take. We accept that the Labour party is implementing a manifesto promise, but the Lords have made reasonable recommendations on how things could be done better, and how we can put the passenger at the heart of the Bill. The amendments look at where passengers already get good services, and stage changes in a way that will not be disruptive to passengers who already get a good service on the railway network.
Mark Ferguson (Gateshead Central and Whickham) (Lab)
I wish to associate myself with the comments of the Secretary of State for Transport. Having heard what she said about some of the amendments from the other place, I can say that she is a far more generous person than I am. I have not been in this place long, but I can certainly tell mischief when I see it—mischief from the other place and, I am afraid, from the Opposition—because the intention here is not to put the passenger at the heart of the Bill. If Conservative Members, when in government, had genuinely wanted to put passengers at the heart of the railways, they might have acted differently over 14 years of abject failure. I spend a lot of time on the railways, as do many Members across the House when travelling between Westminster and their constituency. I see that failure daily, as I have done most of my adult life, at times when, regrettably, the Conservative party has been in government. Conservative Members cannot even explain how much the amendments would cost.
As I said, rail privatisation has been a failure. The Lords amendments do not seek to overturn the decision of this House—of course not—but they would cause considerable delay. However, rail changes made by this Government will be meaningful, unlike those made by the previous Government. Does anyone remember Great British Railways, which the former Member for Welwyn Hatfield was incredibly proud of? Except there was a problem: the railways were not great, and quite often they were not owned by British companies, although I suppose we do at least have to give him the fact that they were railways. Under this Government, there will be great British railways, with one single train operator, and we will deliver a fundamentally better service.
I come from a part of the country that is proud of our railway tradition. George Stephenson, the father of the railways, came from not too far from my constituency, and each week I walk over a high level bridge designed by his son, Robert Stephenson, which still carries trains to this day. The Stephensons would be appalled to see the state of the British railway system today. We transported railways around the world, yet those travelling across Europe or Asia today will see rail systems that are far beyond what we have in the home of railways. That is a national embarrassment.
Finally, Lords amendment 3 on the public sector equality duty is excellent, and I will support it. The point was well made earlier today, during debate on the ten-minute rule Bill, about the indignities that disabled people too often face on the railways. I thank Members from the other place for tabling that amendment, and the Secretary of State for indicating the Government’s support. Ultimately, the public sector equality duty is a high bar, as it should be, and as this Labour Government bring other services back in house, I would like that public sector equality duty to be applied to them.
Zöe Franklin (Guildford) (LD)
Let me say how grateful I am that the Government have accepted Lords amendment 3. The accessibility of public transport is crucial for all those who wish to use rail services and are currently unable to do so because of their disability needs. All village stations in my constituency lack step-free access, and it is deeply frustrating for train users that they have to schlep into Guildford. Wonderful as Guildford town station is, they should not have to travel that far; they should be able to get on the train and head where they want to go. Accessibility is not just for those with disability concerns, as it improves the service for all users—I think of mums and dads with buggies, and cyclists. Step-free access makes trains more accessible, meaning that more people use them. That improves the level of traffic on our roads, which leads to the goals that we all share to reach net zero and create a greener future. I endorse Lords amendment 3 and will support it. I look forward to seeing the detail of the Government’s accessibility road map, and a step change in the speed of delivery under the Access for All programme.
Graham Leadbitter
The SNP supports the Bill and the Government’s position on the Lords amendments, mainly because the SNP Government in Scotland have already driven forward with public ownership. Sadly, without full and normal powers of independence—those will come in due course—the Bill is the current means to support and underpin those actions by the Scottish Government.
I accept the Secretary of State’s position on Lords amendment 1. To take an example from my constituency, Inverness Airport station was opened relatively recently, and that adds time to the journey between Inverness and Aberdeen. Kintore station in Aberdeenshire was also opened, adding time to the overall length of the journey, but I do not think anybody would dispute that those are good improvements to the railway. They open up the railway to far more people, meaning that more people are using the line, spending money on rail services, and taking cars off the road, even if the overall journey time has not been reduced. Therefore the definition of an improvement in performance is really important, and the amendment gives no indication of how that will be dealt with. For that reason, the SNP does not support it.
We agree that Lords amendment 2 could result in further loss to the public purse and the paying of excessive fees over an extended period. We want that money to come back to the public purse so that it can be reinvested in the railway and increase the usage of our trains. This is not the 1980s. There is a lot of talk about going back to how things were prior to privatisation, but governance and scrutiny are now in a very different place from 40 years ago, and we should acknowledge that. A railway that is publicly owned might bring about a real and sustained age of the train, which we might recall from our youth, with real infrastructure investment like that seen in Scotland. We want to continue to do more of that. That will drag people back on to the railways and move them off the roads, which will contribute to our efforts on climate change and gently improve people’s lives. That is why we support the Government’s position on the Lords amendments.
Several hon. Members rose—
Madam Deputy Speaker (Ms Nusrat Ghani)
Order. The hon. Member for Derby North would have been called sooner if she had been consistent with her bobbing, but I know she has been here throughout the debate, so I call Catherine Atkinson.
Catherine Atkinson
Thank you, Madam Deputy Speaker. I rise to speak in favour of Lords amendment 3 and the public sector equality duty. I welcome the Government’s plans for an accessible road map, and the fact that they will work with disabled communities to ensure that the Bill properly meets the needs of people with disabilities who travel on our trains. In the other place the Minister for Rail noted that although some changes can happen quickly, such as the map, others take longer due to the longevity of rolling stock.
I encourage the Government to work with rolling stock manufacturers to formulate a plan as to what changes need to be made to our trains, so that they can be modernised to ensure that future generations of stock serve the disabled community. Given the direction on accessibility, sustainability and affordability, I know that not only the east midlands rail cluster that my constituency is in but the whole industry will be inspired to be the first, so that other countries will want to follow. I hope that Lords amendment 3 will encourage all those who are championing improvements for our disabled communities.
Madam Deputy Speaker (Ms Nusrat Ghani)
I call the Secretary of State to wind up.
Louise Haigh
I thank all Members for their important contributions. Let me start by echoing my hon. Friends’ frustration with the Opposition’s position. I sat for two and half years in the place of the shadow Secretary of State, the hon. Member for Orpington (Gareth Bacon), begging his predecessors who sat in my current seat to take action on performance on behalf of passengers, so forgive me, but I will not be lectured by the party that gave Avanti West Coast a nine-year extension. I will certainly not be lectured about putting ideology before the interests of passengers. This Bill is one step towards the biggest reform of our railways in decades. It will put passengers first, and I look forward to debating with all Members of this House as the railways Bill is introduced and passes through the House.
I appreciate the constructive way in which the hon. Member for Wimbledon (Mr Kohler) approached the debate. As I set out in my opening remarks, I am concerned about potentially perverse incentives. We have already published our six objectives for the railway in our “Getting Britain Moving” White Paper, which cover reliability, affordability, efficiency, quality, accessibility and safety. I hope that he and other Members will accept that those objectives adequately and comprehensively support the objective of putting passengers first.
I thank my hon. Friend the Member for Middlesbrough and Thornaby East (Andy McDonald) for his passionate defence of the Government’s position and his comments on the ideological position that the Conservatives have pursued. He exposed the huge flaws in their argument as they attempt to frustrate the Government’s progress on this important reform.
My hon. Friend the Member for Burton and Uttoxeter (Jacob Collier) gave a passionate account of the impact of the poor performance of the railways that we have inherited. It cuts entire communities off, and he outlined the importance of having an accountable railway system, which these reforms will deliver by having a single point of access to Great British Railways, through which Members across this House and, crucially, local people through their local leaders can hold the railways to account.
There were powerful contributions from my hon. Friend the Member for Gateshead Central and Whickham (Mark Ferguson) and the hon. Member for Guildford (Zöe Franklin) on Lords amendment 3, which will be transformative in ensuring that the railways are accountable under the public sector equality duty, that we lift our ambition and aspiration for our railways, and that passengers, particularly those with accessibility needs, are at the heart of this reform.
I am grateful to the hon. Member for Moray West, Nairn and Strathspey (Graham Leadbitter), who spoke for the Scottish National party. I agree wholeheartedly that we are not going back to the ’80s or to British Rail—I am obviously far too young to remember it anyway. This is not Network Rail 2.0 or British Rail rebooted; this is an enormous once-in-a-generation opportunity for a new organisation with a new culture and a new ethos, bringing a genuinely new era for our railways. Finally, I thank my hon. Friend the Member for Derby North (Catherine Atkinson) for her consistent passion and contribution on behalf of the wider supply chain. I can happily commit that we will work with rolling stock manufacturers as part of our accessibility road map.
On that note, I ask the House to support the Government’s position by rejecting Lords amendments 1 and 2 and accepting Lords amendment 3.
Question put, That this House disagrees with Lords amendment 1.