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Nick de Bois (Enfield North) (Con)
I was delighted to hear that this is the first time that you have chaired Westminster Hall, Mr Bone. I can confirm that this is my first debate in Westminster Hall. I am sure that you will agree that at our respective ages, it is good to be maidens in anything.
I am grateful to have secured the debate. I requested it because of the significant disquiet about delays and overcrowding from Enfield Town, Turkey Street, Southbury, Enfield Lock and Brimsdown railway stations. Unlike in other parts of north London, there are barely any alternatives to rail for commuters in Enfield. I am grateful to have had my right hon. Friend the Minister’s time on many previous occasions, when she has shown considerable interest in commuter services for my constituents. I also welcome my hon. Friend the Member for Enfield, Southgate (Mr Burrowes), who has worked closely with me on the issues under discussion today.
I am keen to show that the new franchise agreements could be used positively to support wider community objectives as well as to deal with the immediate transport issues, but to understand that opportunity, we need to appreciate the local geography and how the railway is organised. That will enable us to learn from past mistakes and look to the future.
Let me start with the local area. Enfield as a community is already changing. There are, of course, classic suburbs, but it is worth noting that across the wider borough, there are six of the most deprived areas not just in London, but in Europe. However, there are also opportunities, particularly in the Lea valley, where we can succeed in regenerating and place shaping for the future. Such plans exist, but they will depend on the right infrastructure. In theory, the Lea valley and Enfield as a whole are linked by the umbilical cord of the railway system. Clearly, there is commuting straight out of London, through Enfield and up to Cambridge, Stansted and beyond. We can attract, but also need services to attract, inward commuting to help to support regeneration.
What is the railway offer? In our part of London, we have one main line from Cambridge and Stansted that goes through the eastern corridor of Enfield and the Lea valley to Tottenham Hale and Liverpool Street. It is run by National Express East Anglia. That franchise also runs the suburban line through central Enfield, which serves two end points—Cheshunt and Enfield Town—running through Seven Sisters. There is a second suburban line, run by First Capital Connect into Moorgate via Finsbury Park, which serves western Enfield.
Both suburban lines are overcrowded. There is no question about that, particularly for the underground interchanges, and the train capacities are limited. In particular, from Cheshunt and Enfield Town via Seven Sisters, there are at best six trains an hour, with perhaps six to eight coaches. In the off-peak period, there are at best two services an hour from Enfield Town. Such services can hardly be described as underground or even metro standard. The problems have been compounded by limited investment in recent years. I should add that only five stations across the whole west Anglia network are gated, and revenue is being lost as a result.
As for the main eastern Lea valley line, which goes through Enfield Lock and Brimsdown, we have a mix of limited-stop and local trains, governed by 15-minute scheduled Stansted Expresses. West Anglia is one of the most demanding and pressurised rail corridors in the country. There is no place for a fast train to pass a slower one until Broxbourne, some 17 miles from central London, with the obvious result that the faster trains do not go fast enough and the slower trains are going slower than required and are not able to stop and serve all the stations. That leads to immense frustration for commuters on platforms, who are quite keen to get on those trains. There are no winners at the moment.
The railway area that I am talking about is predicted to grow, in passenger transport terms, by up to 37%. Admittedly, we may see some variation in that, given current economic circumstances, but it is a fast-growth area. It is true that over the whole franchise, there will be up to 120 new carriages in 2011-12, but they will principally be focused on the 12-coach train fast services. The losers will be Enfield suburban services. So it really is a case of when, not if, we can invest in additional track and signalling as well.
I now turn to the wider national picture, examining the linkage between Government rail policies and the franchising process. As we know, National Express operates under a franchise awarded by the Strategic Rail Authority in 2004. The specification focused on improving performance, but it also allowed more Stansted Express trains, which, as I have explained, did not do Enfield services any favours. At best, we were marking time, but services were made worse on the eastern Lea valley line.
With the benefit of hindsight, we can see that the franchise agreement did not deal with the underlying problems, but just worked the existing railway harder. Of course, that has not necessarily been to our advantage. It shows that we have lacked investment and are still waiting for that investment. In that respect, the previous Government cannot avoid the blame, because they had been controlling the SRA since 2005.
Latterly, the Labour Government had three simultaneous desires: to maintain a command-and-control process in relation to the railways, to move the taxpayer to fare-payer ratio from 50:50 to about 30:70, and to try to breathe life into a money-go-round of fares generating profits for investment. That led to the unacceptable highly leveraged bids for a number of franchises. The most notorious was the east coast bid by National Express, which failed commercially in 2009. Sadly, the record shows that that was not the only failure; there was one in 2006 as well. I am no great literary scholar, but as Oscar Wilde might have put it, to lose one operator is a misfortune; to lose two is somewhat careless. Unfortunately, it proves that the franchising money-go-round is not working.
That brings us to the national position on franchising. If the money-go-round is not working, the funding rules must change, but that depends on how franchises are constructed. The basis of franchising has a history of always changing. Objectives have focused on lowest net subsidy, highest premiums or achieving specified service performance and quality for passengers. That meant increasingly that although operators might have been working in the private sector, they had a straitjacket on them that prevented them adding the value that passengers and commuters want.
In parallel, the contractual length of franchises had been adjusted. Sometimes they were on a bespoke basis. A franchise was longer if a railway needed more investment in trains. However, in recent times the norm has been about seven years, sometimes with an extension for good behaviour. Fundamentally, as many of us recognise, that short-termism does not incentivise major investment by the private sector.
Furthermore, the franchising rules did not achieve the right outcomes for National Express East Anglia lines in Enfield. Passengers’ overall satisfaction is measured by the national passenger survey. The operator has consistently performed below the London and south-east sector average and well below the highest franchise in the sector. That is despite punctuality having improved.
I noticed today—I trust that the Financial Times is correct—that an announcement has been made to grant a temporary extension to the franchise for another seven months. I understand the reasons behind that and accept it fully, but what concerns me is that many passengers might interpret that as an endorsement of what has happened in the past. That clearly is not the case. It is designed ultimately to allow us to have a better system for the future.
The new franchising reform consultation suggests that future franchise bids will be judged on the quality of the overall package of proposals. My constituents will welcome that. Let us look to the future. Public funds are tight. We must look to a new partnership between the Government and the private sector to secure long-term funding by train operators to leverage better services and facilities. That is good news. Enfield is awaiting a new franchise; it will be one of the first. The Government emphasis on outcomes and long-term franchises presents us with short and long-term opportunities.
Bob Stewart (Beckenham) (Con)
Does my hon. Friend think that this new franchise might be a model for other franchises, such as in south-east London?
Nick de Bois
I am grateful for that intervention. In fact, I will go on to address such issues—particularly local ones in London, which I am sure my hon. Friend faces in his constituency. That is exactly my point: now is the time to be bold and imaginative, notwithstanding the constraints that we are all working within.
I shall turn to the priorities that commuters wish to see. These include refurbishing trains, so that we can get consistent appearance and quality, and improving security by introducing ticket barriers, and perhaps increasing CCTV as well. More stations protected by ticket barriers will lead to better revenue protection. In addition, investing in the key interchanges of Seven Sisters and Tottenham Hale, which service Enfield, will be crucial in making them more accessible. A fundamental priority is train frequency.
I accept that, in the short term, infrastructure will largely be as it is now, which limits what can be achieved. I commend to the Minister an interesting recent report from the London borough of Enfield showing a positive case for a more frequent local train service between Enfield and Liverpool Street in the off-peak. That analysis is based on journey-time savings and does not include the other expected community and economic benefits. I believe the benefit-cost ratio, as the report demonstrates, would be under current rules of 1.46:1. That is before we take into account the greater community and economic benefits. I understand that 1.5 is the guideline for investment. There is a strong case.
As an aside, many stakeholders regret that the current official proposals for four trains per hour to Stratford from the Lea valley line through Enfield will only exist for the 2012 Olympic games. The Enfield report shows how a revision to train-stopping patterns on the Lea valley line could regularly achieve four trains per hour, peak and off-peak, to the busiest stations in the areas requiring regeneration. I am happy to commend the report, on which much work was done, to the Minister.
Other short-term matters must be highlighted, including work to solve passenger crowding at the Victoria line interchanges. I look to action on the local level crossings, which are a source of risk—all too tragically, in Enfield, very recently. I also look to action on performance delay. Improving disability access, particularly at the key interchange routes, is a must.
Further progress on studies about expenditure during the new investment periods is needed. For example, a long-term franchise should be able to address the broader spectrum of opportunities, including the case for partial four-tracking on the Lea valley line, which will improve the service, as I have explained, as previously it was two-track.
To conclude, I fully support the approach taken by my right hon. Friend the Secretary of State when he said that he will involve all elements of the rail industry more fully in the decision-making process. I support the decision, and regard it as vital to accelerate the rail value-for-money review under the leadership of Sir Roy McNulty. It is vital that we look to improve our existing infrastructure even in these hard times and his work should help drive that forward.
For Enfield, it is crucial that franchise agreements set out not just clear performance indicators but levels of investment and service agreements that can be benchmarks, and that they send a clear signal that economically important areas served by railways—such as my constituency and neighbouring areas—are open for business and that we can help rail services to support that and regenerate the area. Our business community and developers will be keenly watching franchise agreements before making investment decisions. West Anglia will, as my hon. Friend the Member for Beckenham (Bob Stewart) pointed out, be a test for the new Government of the new rail management and franchising system. Those routes could be exemplary and even a fast-track trial area for a new approach to delivery. A new franchising policy presents us with such an opportunity, delivering, as it says in the coalition agreement,
“the improvements that passengers want—like better services, better stations, longer trains and better rolling stock”.
The Minister of State, Department for Transport (Mrs Theresa Villiers)
It is a pleasure to serve under your chairmanship, Mr Bone. I congratulate my hon. Friend the Member for Enfield North (Nick de Bois) on securing the debate and presenting an impassioned case for improvement to rail services in the borough of Enfield. I recall him raising the issue in Transport Question Time shortly before the summer recess. I know that he is a staunch campaigner on these matters in his constituency, standing up for the interests of local commuters in a highly effective way, alongside my hon. Friend the Member for Enfield, Southgate (Mr Burrowes), whom it is great to see in the Chamber today. As the near neighbour of both my hon. Friends—I represent Chipping Barnet—I well understand the importance of transport links in the London suburbs.
My hon. Friend the Member for Enfield North set out his concerns about reliability and performance. As we have heard this morning, train services to Enfield are operated by both National Express East Anglia and First Capital Connect. In my ministerial capacity, I take a close interest in the performance of all train operators, but my role as MP for Chipping Barnet means that I have an additional reason to scrutinise the performance of FCC on the Great Northern line, as it serves my constituency as well as Enfield.
That franchise experienced significant disruption between October 2009 and January of this year. That was largely caused by industrial action, and Thameslink services were the worst affected. However, there were also problems on the Great Northern line, which serves Enfield. It was particularly regrettable that action by drivers meant that no trains ran on Remembrance Sunday last year on the suburban Great Northern line services. I am relieved that the problems that led to that disruption have gone away for the moment, and that First Capital Connect’s overall public performance measure has recovered to reach the levels prevailing prior to that episode. However, the underlying issue for the railway—namely that on a number of routes drivers are not under a contractual obligation to work on Sunday—obviously has yet to be resolved.
As far as National Express East Anglia—the main focus of my hon. Friend’s remarks this morning—is concerned, in the latest period for which complete performance data are available, 90.8% of NXEA’s trains arrived on time, according to the PPM moving annual average figure. That is an improvement, albeit a modest one, on the 88.6% reliability levels that it inherited from the previous franchise in 2005. It is also worth noting that PPM figures are aggregated across a diverse franchise, covering long-distance, rural and commuter services. That means that they do not necessarily give us all the answers, when it comes to the specific performance of Enfield services. As my hon. Friend pointed out, NXEA’s most recent national passenger survey results indicate that it is below the average for London and the south-east. I agree with my hon. Friend that there is room for improvement.
My hon. Friend referred in some detail to capacity and his constituents’ concerns about crowding. The latest passenger loading data confirm that overcrowding is indeed an important issue on some Enfield services. Anxiety about overcrowding in a number of parts of the UK’s rail network increased during the previous Government’s term in office. In my view, one of Labour’s most serious mistakes was that it took far too long to wake up to the seriousness of this problem. It took, for example, over a decade to get moving on projects such as Crossrail and Thameslink. Four successive Labour Secretaries of State for Transport promised extra carriages under the HLOS—high-level output specification— programme, but that political decision came late in the day and less than a quarter of what they promised had arrived by the time that Labour left office. That leaves the current Government to deal with the problem during very lean times, when the pressing need to deal with the deficit that we inherited from our predecessors places intense pressure on the public finances.
The issue for consideration today is how we address the problems experienced by commuters—problems of the kind outlined by my hon. Friend—in an affordable way, consistent with our pledge to address the deficit that we inherited from the previous Government.
First, I should mention that I meet senior representatives of the rail industry and the Office of Rail Regulation every month to assess performance levels on all lines, and to scrutinise carefully the record of Network Rail and the train operators. Of course, the ORR takes the lead on these matters, but I am grateful to those who participate in what is a very useful process for me. Following on from my hon. Friend’s intervention at Transport questions, I raised the issue of NXEA services in Enfield with the group.
As my hon. Friend was kind enough to acknowledge, the Government’s wider reform agenda has the potential to drive forward progress in addressing a number of the issues that he raised. Our approach has three parts: first, reform of Network Rail; secondly, reform of rail franchising; and thirdly, taking forward capacity enhancement programmes where they can be reconciled with our commitment to address the deficit.
As hon. Members will be aware, making progress on reliability and delivering extra capacity depends in no small part on ensuring that Network Rail, as the infrastructure provider, delivers high-quality services to its customers in an efficient and cost-effective way. In the case of the NXEA services that we are considering, the most recent industry figures indicate that Network Rail was responsible for just over 60% of delays on the franchise. In particular, I am advised that Network Rail infrastructure has suffered a number of overhead line problems.
I very much welcome the fact that the franchise operator and Network Rail are working together to try to address the problem. However, if we are to improve Network Rail’s performance and reduce its costs, the company needs to be made more accountable for its actions, and that includes demonstrating greater accountability for its decisions on executive bonuses. We are considering a number of options, and we are working with the ORR and other stakeholders to take that work forward. I should make it plain, however, that the status quo is not acceptable, and we will be making changes in due course.
As we heard this morning, the Government are consulting on reforms to the rail franchising system, and those are the second element of our strategy for addressing the problems outlined by my hon. Friend. The reforms are aimed at moving away from a system in which Whitehall specifies highly detailed and prescriptive inputs for franchises—what my hon. Friend referred to as the command-and-control approach to the railways. Instead, we want a stronger focus on the quality of outcomes for passengers, while giving the professionals who run our railways more flexibility to apply innovation, enterprise and specialist expertise in working out the best way to deliver outcomes.
We need a more qualitative approach to the assessment of franchise bids—an approach that judges the quality of a bid’s overall package of proposals to invest in the railways, improve services and grow passenger numbers—rather than focusing solely and exclusively on the binary question of the level of subsidy or the premiums to be paid. Again, I hope that that will address some of the problems involved in what my hon. Friend referred to as the money-go-round.
Franchises should also be longer. We expect 10 to 15 years to become the normal, expected length, with the possibility of franchises running for up to 22 and a half years, where significant investment is promised. The increased certainty that longer franchises will give train operators will encourage private sector investment in the railways and help to deliver the improvements that passengers want. My hon. Friend called for us to include better services, better stations, longer trains and better rolling stock. On the specific improvements that he asked for, I hope that he will understand that I cannot prejudge the process that will commence once the franchise re-let is under discussion, but I encourage him to take part in the consultation on the re-let as and when it starts.
Our reformed franchises will set demanding passenger satisfaction outcomes for train operators to achieve. Train operators that do not comply with franchise requirements will face sanctions. Ultimately, in the case of very serious failure, sanctions will include termination of the franchise. The approach that we have set out in our consultation document will enable and incentivise train operators to respond more effectively and efficiently to commuters’ concerns. I expect our proposed measures to help address a range of the customer service and capacity issues that my hon. Friend outlined.
At this point, I should respond to my hon. Friend’s questions about the timetable for re-letting the East Anglia franchise. I reiterate that I decided to cancel the franchise competition initiated by the previous Government to ensure that the new franchise was issued under the reformed system, and to ensure that passengers using NXEA services could have the benefits of the changes that the coalition has promised to deliver. The franchise was due to be re-let and to commence on 1 April 2011, but a contractual extension has been agreed until October 2011.
I turn now to the third element of Government policy that is relevant to the matters under consideration: delivering additional capacity, where that can be reconciled with our commitment to address the crisis in the public finances that we inherited from the previous Government. The Department for Transport is funding 120 new carriages for the East Anglia franchise. Most will be used on the Stansted Express route, with some deployed on Cambridge commuter services. The carriages are expected to enter service from March 2011, and that will free up carriages that will be used to strengthen services on other parts of the NXEA network. The decisions on exactly where those carriages will go have yet to be made, but I am advised that stations in Enfield will be among those that benefit from the extra capacity.
Additional capacity will be introduced on First Capital Connect lines to Enfield in December 2010. In the morning peak, five of the six stations in the borough—Gordon Hill, Enfield Chase, Grange Park, Winchmore Hill and Palmers Green—will have three additional six-car train services to Moorgate, and one of the existing services will be doubled in size from a three-car to a six-car train. The five stations will also be served by additional services to Hertford North and Gordon Hill from Moorgate. The remaining station, Crews Hill, will be served by two additional six-car train services.
In the evening peak, the same five stations will have an additional three services, two of which will go to Gordon Hill, with the third going to Hertford North. That is except for Grange Park, which will have two additional services running to Gordon Hill. All those additional services will be six-car trains. Additional services will also run from Gordon Hill to Moorgate. Crews Hill will benefit from an additional six-car train running to Hertford North. There will be three more services during the morning peak, and extra carriages will be added to one of the existing services. Evening peak service capacity will see similar improvements and increases in capacity. Those morning and evening peak improvements are part of the additional 3,800 peak-time seats being added to Moorgate services from December.
In conclusion, I understand my hon. Friend’s concerns. The Government are working to ensure that we have a reliable railway and that crowding problems are addressed. We face the difficult task of achieving that at the same time as tackling the state of the public finances that we inherited from the Labour Government. I have summarised some of the most important initiatives that we are taking to seek to achieve those important goals. When the consultation process begins for the re-let of the franchises serving my hon. Friend’s constituency, I very much hope that he will make his views known. I am sure that they will be a valuable and welcome contribution to that important process, just as his remarks this morning have been a valuable and welcome contribution to the debate.