The Minister of State, Department for Transport (Lord Hendy of Richmond Hill) (Lab)
We are fully committed to supporting rail freight growth, recognising significant economic and environmental potential. Following our plans to overhaul the railways, Great British Railways will have a duty and targets to grow rail freight. I have discussed the decision regarding its trains with Royal Mail. As it is now a private company not owned or controlled by the Government, the mode used to move mail is a commercial decision for the business.
Lord Snape (Lab)
My Lords, at the risk of appearing in the Government Chief Whip’s black book, I congratulate my noble friend on his appointment in the Department for Transport and want to say how much it is welcomed by those of us who take an interest in these matters. Could he perhaps read the Riot Act to Royal Mail Ltd? Despite the fact that it is a semi-privatised organisation and he has no real control over it, does he agree that it is deplorable that a century and a half of traditional and dedicated rail carriage of mail is to be cast aside to carry mail on a fleet of heavy goods vehicles, so adding to the congestion and pollution on our roads and motorways? Further, is there not something wrong with a licensing system that makes it cheaper for companies to behave in this way rather than, as my noble friend has suggested, transferring freight from road to rail?
Lord Hendy of Richmond Hill (Lab)
The mode of transport chosen by Royal Mail is an operational decision, over which Ministers and the regulator have no role under postal regulation. It has emphasised the low-carbon credentials of its road fleet, using electric vans and biofuel in HGVs to reduce emissions. However, I have already encouraged Royal Mail, and will continue to encourage it, to take an ambitious approach to the wider use of rail freight as part of its commitments to net zero and to reducing congestion our roads, including exploring the innovative and growing express rail freight sector. I assure your Lordships’ House that, in my new role as rail Minister, I will be championing the role of freight on our railways.
Lord Kirkhope of Harrogate (Con)
Will the Minister please respond to the concerns of many people in this country who feel threatened by the changes involved in the new proposals for the daily delivery of domestic letters and parcels to our houses? Will he comment on the proposals to diminish this service?
Lord Hendy of Richmond Hill (Lab)
In respect of the carriage of mail by rail, my department officials are working closely with officials from the Department for Business and Trade. I would be happy to take the noble Lord’s comments back to both departments. I have to say that this is still an operational decision for Royal Mail, over which Ministers and the regulator have no role under postal regulation.
Lord Sikka (Lab)
My Lords, Royal Mail is a private company but the effects of its operations are public. It affects traffic congestion, as has already been mentioned, as well as health and carbon emissions. This will have some impact on everybody. In the light of that, can the Minister explain what additional taxes will be levied upon Royal Mail for causing these harms?
Lord Hendy of Richmond Hill (Lab)
I thank my noble friend for his question. Only 3% of Royal Mail’s letters and parcels are moved by rail. There are 600 freight services running on the network every day, of which the trains in question account for just six, so it is not thought that this will have a substantial impact on the overall amount of freight moved by rail. The matter of the taxation regime for rail and road is quite different.
Baroness Randerson (LD)
I congratulate the Minister on his new appointment and thank him for his early comments, but point out that, while Royal Mail may be an independent company nowadays, it works within a legislative framework. Are the Government considering amendments to the legislative framework for both Royal Mail and other companies in similar settings to increase their environmental obligations and raise expectations that they will use environmentally sounds forms of transport?
Lord Hendy of Richmond Hill (Lab)
The department’s officials are working closely with officials from the Department for Business and Trade. I will take the noble Baroness’s comments back to both departments.
Baroness Vere of Norbiton (Con)
My Lords, the previous Conservative Government were very supportive of the modal shift; in fact we introduced the Mode Shift Revenue Support scheme. Have the Minister’s officials pointed Royal Mail to that scheme, and might it be helpful in this regard?
Lord Hendy of Richmond Hill (Lab)
My understanding is that the Mode Shift Revenue Support scheme, which has a budget of £18 million for 2024-25, has been effective. The current scheme expires on 31 March 2025, but my current understanding is that it does not apply to the carriage of mail by rail.
Lord Grocott (Lab)
Can the Minister, whose appointment I also welcome, confirm that one of the arguments for HS2 to Birmingham was very much to free up capacity on the existing west coast main line by an additional route from London to Birmingham? In that connection, does he agree that one of the many disastrous decisions made by the previous Government was to scrap the HS2 project north of Birmingham? What assurance can he give us that the current Government, among the many changes they have planned, will change that particularly bad decision?
Lord Hendy of Richmond Hill (Lab)
I thank my noble friend for that question but it moves quite a long way from the carriage of mail by rail. I think there might be more appropriate times at which to consider the railway infrastructure of Great Britain and the future infrastructure plans of this Government.
Lord McLoughlin (Con)
In congratulating and welcoming the Minister to his place—a man who will probably be giving advice to his civil servants rather than the other way around—I would like to ask him about the long-term plans for freight on the railways. What extra measures does he envisage taking, bearing in mind the serious capacity issues that have just been referred to by the noble Lord, Lord Grocott?
Lord Hendy of Richmond Hill (Lab)
I welcome the comments from the noble Lord, Lord McLoughlin. It is important that rail freight increases, but the noble Lord is correct in referring to capacity problems on some parts of the network. There are two things to do. First, historically the freight companies have a number of paths that they do not use and never have done, which are getting in the way of running more passenger trains. Secondly, in return, the Government’s emphasis on the carriage of more freight by rail demands us to look carefully at the capacity of the railway and facilitate the paths that are needed for modern freight, particularly containers and bulk aggregates, in order that traffic can increase.
Lord Wallace of Saltaire (LD)
My Lords, is the Minister aware that one of the choke points if one wants to increase the amount of freight moved by rail is across the Pennines? The M62 is crowded every day with trucks carrying containers. I am told that there are no spare freight paths between the west and east coasts in the north of England. Unless extra path capacity is provided, the Government will be unable to fulfil their commitment to increase the carriage of freight by rail in the north.
Lord Hendy of Richmond Hill (Lab)
There is certainly a constraint on the amount of railway capacity over the Pennines from east to west. The trans-Pennine route upgrade, which is currently costing £11 billion, is a significant project already in delivery that seeks to increase that capacity. I know the department’s officials have looked and are looking at what needs to be done with that upgrade in order to make sure that it is suitable for the carriage of more freight, including containers of the larger size.
Lord Berkeley (Lab)
My Lords, it is only 20 years ago that Royal Mail built probably between 26 and 29 large and complicated sorting offices connected to rail and road so that mail could be sorted. This was the modern way of doing it. Two of those—I think one of them is at Warrington and the other is at Willesden, opened by Her Royal Highness Princess Anne —are no longer going to be used. Does that have anything to do with my noble friend’s question about capacity on the west coast main line?
Lord Hendy of Richmond Hill (Lab)
The issue of the age of the infrastructure that Royal Mail uses is overtaken by the issue of the age of the train sets that it currently uses to carry mail. There were originally 15 train sets built, but only six are now in service and they are all 30 years old. Royal Mail’s judgment is that these railway vehicles are now of an age when they are becoming unfit for service.