Grand Committee
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Arrangement of Business
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The Deputy Chairman of Committees (Lord Geddes) (Con)
My Lords, as is customary at the beginning of each Grand Committee, I advise the Committee that if there is a Division in the Chamber while we are sitting, which is unlikely, the Committee will adjourn as soon as the Division Bells are rung and resume after 10 minutes.
UK-US Co-operation on Using Atomic Energy for Mutual Defence
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Lord Goldsmith
That the Grand Committee takes note of the Amendment to the Agreement between the United Kingdom and the United States of America for Cooperation on the Uses of Atomic Energy for Mutual Defence Purposes, laid before the House on 26 July.
Relevant document: 2nd Report from the International Agreements Committee
Lord Goldsmith (Lab)
My Lords, I welcome the opportunity to debate the International Agreements Committee’s two reports on the related topics of the UK-US mutual defence agreement and the AUKUS agreement. I thank the Government for making the time available for this debate.
I will start with the MDA, which entered into force in August 1958. I am looking forward to this debate, particularly because it includes some new members of the committee; I am very pleased to welcome them to the committee as well. The MDA has been amended several times since it entered into force in August 1958, most recently in 2014. It provides for the exchange of nuclear materials, technology and information relating to nuclear weapons, although it does not provide for the transfer of nuclear weapons themselves. It underpins the UK’s nuclear weapons programme, and as such is a key part of the special relationship.
Despite the MDA being described as the cornerstone of the defence nuclear relationship between the UK and the US, amendments to the agreement in 1994, 2004 and 2014 were not subject to debate in Parliament or a Select Committee report. External stakeholders such as CND and the Nuclear Information Service have raised concerns about the lack of parliamentary scrutiny of previous amendments to the MDA and have called for a debate on the most recent amendments. I am therefore very pleased that we are having this debate today.
The amending agreement should be considered in the context of key developments to the UK’s nuclear deterrent. The UK is currently in the process of modernising its nuclear capabilities and nuclear-powered submarines, aiming to replace its four Vanguard-class ballistic missile submarines with the new Dreadnought class from the early 2030s. A programme to replace the UK’s nuclear warhead was also confirmed in February 2020. In March 2024, the previous Government published a new Defence Nuclear Enterprise Command Paper, which sets out the long-term approach to investing in and developing the UK’s nuclear deterrent. The United States is also currently modernising its strategic nuclear capabilities.
The amending agreement should also be considered in the context of particular concerns. Some commentators have criticised the MDA as it risks the UK appearing to become overdependent on the US in relation to developing an independent nuclear weapons programme. However, the Ministry of Defence told us that co-operation with the US is based on the understanding that the UK’s strategic nuclear deterrent remains independent.
Turning to the committee’s report, we make two main recommendations: two key conclusions, both related to the unsatisfactory arrangements for parliamentary scrutiny of the MDA. First, we welcome the expectation that ratification of the amending agreement by the US will be completed within the terms of the current Administration and Congress. But we also observe how the thorough congressional scrutiny processes contrast starkly with the inadequacy of our own arrangements.
The US began its process of ratification earlier than the UK. Under the Atomic Energy Act, Congress has the opportunity to review a nuclear co-operation agreement for two periods totalling 90 days of continuous session. That is 30 days of consultation with relevant committees and 60 days during which Congress has the opportunity to adopt a joint resolution of disapproval. The Ministry of Defence has indicated that the period for congressional review has now concluded. By contrast, under the Constitutional Reform and Governance Act, or CRaG, Parliament has only 21 sitting days in which to scrutinise a treaty, take evidence and report on it, and hold a debate.
Considering the MDA’s role in forming the cornerstone of the UK-US defence and security relationship, the committee particularly regretted the lack of sufficient time to take evidence on this important agreement. This is yet another example of the shortcomings of the CRaG regime. Noble Lords may be interested to know that the committee is currently considering and conducting an inquiry into how parliamentary scrutiny of treaties can be improved in future. We have commented on this in previous reports.
In our second conclusion, the committee drew attention to a specific change in the amending agreement, which will potentially reduce the already scarce opportunities for Parliament to scrutinise the MDA. This concerns Article III bis, which provides for the transfer of non-nuclear parts, enriched uranium, special nuclear material and equipment. Article III bis is time-limited and has been renewed on a 10-year cycle since the 1980s. The requirement to approve revisions to Article III bis has also provided the opportunity for both parties to make further amendments to other parts of the MDA. Article 5 of the amending agreement amends Article III bis so that its provisions are “extended indefinitely”, with no requirement for periodic renewal. Given the strategic importance of UK-US co-operation at this critical time in replacing the UK’s nuclear deterrent to maintain the country’s security, the committee is concerned at this reduction in scrutiny opportunities and calls on the Government to commit to providing a report to Parliament on the progress and operation of the MDA every 10 years. That is a critical conclusion and recommendation of this committee.
Having dealt with the MDA, I want to turn now to the committee’s report on the AUKUS agreement relating to co-operation on naval nuclear propulsion, which forms part of the broader trilateral defence and security partnership between the UK, the US and Australia. This agreement has been made under pillar 1. The first phase of the partnership focuses on supporting Australia to acquire its first conventionally armed, nuclear-powered submarine fleet. Upon its entry into force, it will supersede the current exchange naval nuclear propulsion information agreement, which entered into force in January 2022. That agreement, which I shall call the ENNPI agreement, allowed for the exchange of information to facilitate an 18-month study into the delivery of a conventionally armed nuclear powered submarine capability to Australia. The committee reported on that agreement on 13 January 2022, drawing it to the special attention of the House, and a debate was held in Grand Committee on 17 January.
The new agreement will allow the UK and US to support Australia in acquiring its first conventionally armed nuclear powered submarine fleet from the 2030s. As well as allowing the continued exchange of naval nuclear propulsion information, it will authorise the transfer of material and equipment relating to naval nuclear propulsion, including special nuclear material in complete welded nuclear power units. That will enable UK industry to support Australia in building a trilaterally developed submarine, incorporating technology from the UK, the US and Australia.
The AUKUS nations have released a joint statement detailing the progress made since the announcement of the optimal pathway in March 2023. The specific progress includes: increased education and training of Royal Australian Navy personnel and specialised US and UK schools; increased industry training to build and sustain nuclear-powered submarines; and preparatory activities to build Australia’s capacity ahead of establishing the submarine rotational force-west by 2027—that is, the rotational presence of UK and US nuclear-powered submarines at HMAS Stirling.
The committee welcomes the significant progress made in the delivery of pillar 1 of the AUKUS partnership. Nevertheless, we must also be mindful of some risks, as well as opportunities, highlighted by some defence commentators. For example, Dr Sidharth Kaushal, writing for the Royal United Services Institute, warned against the sale of the Virginia class to Australia appearing as a diversion of capacity from the US Navy and of the need to manage design trade-offs as well as human capital. Similarly, Andrew Dowse, the director of RAND Australia, outlined risks such as public perception challenges in relation to cost, nuclear proliferation and implications for the sovereignty of an Australian submarine fleet.
I will briefly summarise the link between the MDA and AUKUS agreements and why we are debating both reports together today. The AUKUS submarine fleet will incorporate designs and technology from both the UK and US, so the MDA could have a key role in enabling the exchange of nuclear propulsion technology and information sharing between the parties. The AUKUS submarine will be based on the UK’s next-generation nuclear-powered submarine design and will include US technology based largely on the Virginia-class SSN, including nuclear propulsion technology and components, and a common vertical launch system and weapons. The Ministry of Defence, from which we took evidence, acknowledged that although they represent two separate agreements, the MDA added value to the AUKUS trilateral agreement and that, without the MDA, we would not have the ENNPIA or AUKUS pillar 1.
Before I conclude and look forward to the debate, I thank the Ministry of Defence for its co-operation in assisting our scrutiny work. I thank my colleagues on the International Agreements Committee, a number of whom are here, for their hard work and support. I also thank the officials of the committee, who have to work on what I have already identified as a very tight timetable to prepare reports, briefs and drafts for us, a feature to which we must have regard when we look, as I hope we will, at a revision of CRaG. Finally, I thank those who offered us a slot for debate in Grand Committee within the CRaG period. I beg to move.
Lord Hannan of Kingsclere (Con)
My Lords, I am extremely grateful to the noble and learned Lord, Lord Goldsmith, for both the meticulousness of these reports and for the unfussy, intelligible and lucid way in which he set out the recommendations. I have nothing to add on that level of detail, so I shall take a step back and ponder why these alliances among the English-speaking democracies are the basis of our security.
I take your Lordships back to 9 August 1941, a date which one or two Members of our Chamber will no doubt remember as if it were yesterday. This was the day on which President Roosevelt made the longest walk of his presidency. In a way that is now almost unimaginable, the US media contrived to hide the fact of the President’s polio from the electorate, so he was always pictured standing unaided or seated. However, on that day, walking from the decks of USS “Augusta” to those of HMS “Prince of Wales”, he decided to walk so, supported by his son on one hand and by a naval officer on the other, he made the slow progress to meet the British Prime Minister, while the band of HMS “Prince of Wales” struck up “The Stars and Stripes Forever”.
What followed was the most extraordinary demonstration of what binds the anglophone democracies together. It happened to be a Sunday, so the crews of the two vessels were mustered for a joint religious service. Churchill had chosen every detail personally and meticulously, down to the hymns and the reading that the chaplain gave from the pulpit. It came from Joshua:
“As I was with Moses, so I will be with thee: I will not fail thee, nor forsake thee. Be strong and of a good courage”.
Afterwards, exultantly, Churchill burst out, “The same language, the same hymns, the same ideals”, and when he said “the same ideals”, he was not making a general point about being the good guys. Think of the world as it stood in August 1941. The entire Eurasian landmass, from Lisbon to Vladivostok, was under one form or another of autocratic rule. Liberty was thrown back to the alliance of English-speaking peoples. We talk of universal values, but actually almost everything we mean when we say that was a precept overwhelmingly developed in the language which I am now speaking. The things that make the modern world rational, comfortable and pleasant—regular elections, uncensored newspapers, equality between men and women, the ability of different parties to contest without people being exiled or shot, habeas corpus and jury trials—were overwhelmingly the heritage of the English-speaking peoples. Imagine that the Second World War or the Cold War had ended differently. There would have been nothing universal about them then. We tend to be polite, so we gloss over the extent to which these values became universal as a series of military actions by this country and its kindred allies.
I spent 21 years in the European Parliament and was often teased by continental colleagues about this country’s supposed subordination to the United States. They would mock us: “Do you have any foreign policy of your own? Do you always just have to wait for a phone call from DC? Have you become a sort of aircraft carrier for the US?” As patiently and politely as I could, I would explain that, formed by the same history and institutions, when presented by the same problem, we tended to respond in similar ways. We had a shared indignation with injustice and a shared belief in freedom and the elevation of the individual over the collective.
All of us have lived through a period of anglosphere hegemony, where these values have been treated as universal because they have rested on victory in the Second World War and then the Cold War. But permanence is the illusion of every age. There are rival models out there. Thinking back to the debate we just had in the Chamber, I say that a lot of these rival systems have come together from no motive other than a shared hostility to us. It is very difficult to see what the religious fundamentalists of Tehran, the hermit kingdom of North Korea, the imperial and nationalist autocracy of Russia and the still notionally communist state of China have in common, beyond a hostility to western individual and property rights, free contract and all the things that go with them. History rather disproves the idea that we have an automatic advantage—that other countries will feel their way towards our values as they become richer and more educated.
The Chinese model, in particular, strikes me as a civilisational or categorical alternative to ours. Unlike the others, it is capable of export. Plenty of countries out there do not much like us but, through a combination of high technology—facial recognition and surveillance —and the use of notionally private companies such as Weibo, Tencent and Alibaba to act both as proselytisers and spies for the regime, in a peculiar way Beijing seems to have built a model that it can sell. It could say to, for example, Maduro in Venezuela, “If you don’t want to worry about any more elections, here is a way that we can build you your panopticon state, and then we won’t need to worry about having to deal with any of your successors”.
That, fundamentally, has caused our renewed interest in the Pacific and triggered the AUKUS agreement. It was about maintaining a free world based on the rule of law, rule among nations and open sea lanes, against revanchist states that challenge the established order.
I hope we will be able to build on and strengthen the AUKUS alliance. I look forward, in particular, to its expansion. I am encouraged by conversations that I have had with the Opposition in Canada, who are keen to become involved if there is a change of government. Apart from anything else, that would make it much more euphonic; “CAUKUS” works a lot better than AUKUS, which is quite difficult to say.
I feel that our interest in the Pacific region, quite apart from being in tune with our past, is reflective of the critical economic importance of that region. Just as, at some point in the 18th century, the centre of the world shifted from the Mediterranean to the Atlantic, in this century it has shifted to the Pacific. Tied as we are by habit and history, kinship and custom, language and law, many of the nations in that region do not have the option of remaining neutral.
Let us remember what we are defending. Beijing has a tendency to divide and rule. We have not really been on the receiving end of very much direct aggression, but Australia has—a complete trade embargo and immense diplomatic pressure after it called for an inquiry into the origins of Covid. I do not think that we could possibly be indifferent between an allied English-speaking democracy and an autocratic state. As long as we still have a song to sing and more to give, I hope that we remain involved in that region. Nothing lasts for ever. The day will surely come when
“all our pomp of yesterday
Is one with Nineveh and Tyre!”
But I tell your Lordships what: when that day comes, we are going to miss this era through which we pass more than we currently imagine possible.
Lord Hannay of Chiswick (CB)
My Lords, it is a great pleasure to follow the noble Lord, Lord Hannan, even if I feel compelled to correct slightly some of his history. It is not the case that all this is about English-speaking people. The great meetings that took place on various bits of the Atlantic included the Governments of most of what are now continental European countries. They were of course living in exile in London, but subscribed to the same values and qualities that we applaud today. They were, funnily enough, before the establishment of the United Nations organisation in 1945, called the “united nations”.
I will cast that little blemish aside and address the two amended agreements that we are debating today within what the noble and learned Lord, Lord Goldsmith, correctly described as the CRaG process. They are important and deserve to be considered by Parliament; for that reason, I greatly welcome that the Government have enabled time to be made available to do so. They of course relate to Britain’s nuclear co-operation with the US, dating back to the ending of the lamentable US McMahon Act, which cut us off from any process of nuclear co-operation for a period of years after the end of the Second World War; it was very damaging. We are also debating the strategically important AUKUS agreement, which provides Australia with nuclear-propelled submarines.
Your Lordships’ committee, most ably led by the noble and learned Lord, Lord Goldsmith, whose introductory remarks I totally subscribe to, has found both agreements to be strategically sound and in the UK’s national interest. We also found them to be consistent with our international obligations, including under the nuclear non-proliferation treaty. But—and there are a couple of quite important buts—some significant new issues have been raised, which we hope the Minister will reply to positively when he responds to the debate. Neither affects the treaty with the US, which, in a welcome way, is due to be ratified on its side before the expiry of the present Administration and present Congress.
The first of the buts relates to the CRaG process itself. The noble and learned Lord mentioned the unsatisfactory time limits within which it operates. These are, to be frank, absurdly short and do not allow your Lordships’ committee to subject treaties and agreements to proper analysis and scrutiny, nor to gather testimony. The UK-US MDA, which we are debating today, exemplifies that problem to perfection. It was triggered during the summer and conference recesses and, even though the recess days were taken into account, there was simply no time to organise evidence sessions before we drafted our report. We therefore had only one session with senior officials, for which I express my gratitude; their testimony was extremely useful. No evidence was taken from a Minister, and we had no time to get outside witnesses to come and give different opinions, perhaps, on the treaties that we were looking at. That is no way to handle the ratification of an important international treaty. I really doubt whether any properly constituted democracy permits such a cursory and inadequate ratification review—although no doubt “people’s democracies”, such as Russia and China, would do so with alacrity.
I hope, therefore, that the Minister in the new Government will consider carefully the operating procedures for CRaG documents and will enable them in future to be scrutinised rather more effectively than they are now. I do not expect a response on that point today because, as the noble and learned Lord said, the committee is proposing to put together its considerations relating to the CRaG process in a report before too long.
My second point also relates to parliamentary scrutiny. As a consequence of the decision to eliminate the 10-year review clause in the UK-US MDA—the committee is not objecting to that and the consequent prolongation of the agreement, sine die—there will now be no occasion at all for further parliamentary scrutiny of the operation of the agreement. That is perhaps inadvertent—I am being generous—but is surely a damaging step backwards. One way in which to resolve it would be if the Minister were to state without equivocation at the end of this debate that the Government of the day would bring before Parliament at 10-year intervals a report on the operation of the UK-US MDA so that it could be considered and debated. Such a report would not—I repeat, not—affect the US side, nor affect the maintenance of the amended treaty itself, sine die. It might be said that 10 years is a long way off, but infinity is a bit longer.
I hope that this debate can end in a meeting of minds between the committee and the new Government. That would surely get matters off on the best possible footing.
Lord Udny-Lister (Con)
My Lords, I am grateful that the House has provided time for an important debate that I welcome and we need to have. It is of national importance. I also thank my colleagues on the International Agreements Committee and, in particular, our chair, the noble and learned Lord, Lord Goldsmith, who at times has the job of herding cats because it is a formidable group to try and get to agree something. For that, we all owe him a lot of thanks.
Over the past few weeks, there has been much debate over the future composition of this House and, without wanting to go off on a tangent and risk starting an entirely different debate, I feel that the Government, when they consider the future of this House, should first consider what role they believe Members should play. I make this suggestion while entirely supporting the concerns raised by the committee that the amendments proposed provide a significant risk that the UK-US MDA would no longer be subject to proper routine scrutiny. I therefore fully back the recommendations and the points made by the noble Lord, Lord Hannay, about the need for this agreement to have periodic review.
More widely than that, I put it to the Committee that, in this rather precarious and unstable world in which we live, the CRaG Act 2010 is outdated and the House should be given a greater role in the scrutiny of foreign policy and defence-related matters. I am going to leave the subject of constitutional reform well alone for the time being, but I hope that the Government will today offer the Committee some reassurance on how both the treaty on AUKUS and the amendments to the UK-US mutual defence agreement will be subject to the level of public scrutiny worthy of such matters.
I turn to the AUKUS treaty on naval nuclear propulsion. This trilateral agreement offers the opportunity for the UK to play a leading role in creating a new and much-needed frontier for security in the Indo-Pacific. As I have mentioned in previous debates, the Indo-Pacific region faces increasing tensions, for it is one of the most geographically sensitive areas in the world at this time. It is the duty of the Government to protect our newly forged trade interests in the region, such as the CPTPP and the post-Brexit bilateral free trade agreements that we hold with Japan, Australia and New Zealand, and the AUKUS treaty will go a considerable way to bolstering the defence capabilities of our allies, while advancing our own security and trade interests.
Further, AUKUS facilitates the opportunity to deepen trade relationships with Australia and the United States, which are two of the world’s most advanced and trustworthy economies. Through the bedrock of collaborative security arrangements, AUKUS will enable stronger economic ties, and there is the real potential to drive emerging industries such as AI and quantum computing.
We must view the AUKUS treaty as a necessary counterbalance in the Indo-Pacific region. It must remain a government priority that we honour the treaty fully to ensure that our allies have the partnership support needed to maintain freedom of navigation, to protect our trade routes on the high seas and to do what we in this island nation have proudly done for centuries: deferring and, when necessary, neutralising the aggressive actions of rogue players who do not conform within the international rules-based system that we must at all times continue to maintain.
We should be proud that, through AUKUS, we are part of the future. There is a real opportunity here to harness innovation and technological leadership that will not only strengthen immediately our security but potentially allow us, alongside our US and Australian partners, to lead the world in naval defence innovation. I hope that the Government will seek ways to empower and inspire young people in this country to gain the necessary skills and qualifications to drive this much-needed innovation over the years ahead.
Beyond security, AUKUS represents a major economic opportunity for the UK’s defence industries, which stand to benefit significantly from this trilateral agreement involving two G7 nations and a G10 nation. As we transfer technology and our knowledge, there will be demand in highly skilled jobs and manufacturing. It is therefore vital that the Government set out the right industrial framework to allow the UK to feel fully the benefits of this agreement. I hope that the Minister will be able to update the Committee on the Government’s commitment to work in this area.
When considering pillar 2 of AUKUS, I am really excited and pleased to see artificial intelligence listed among the eight advanced military capability areas. It is a fast-moving area and it is therefore vital that we play our part in collaborating fully through AUKUS in developing cutting-edge AI technologies, hand in hand with our partners. That said, it also highlights the pressing need for a wider debate on the use and application of AI when it comes to defence and warfare. Although I am sure that there is wide public support for the application of AI when it comes to the optimisation of military supply chains, improvements to navigation, enhancing training and simulation, while, of course, countering AI threats, Parliament must be given a voice and the opportunity, within the parameters of protecting national security, to consider how this technology is to be deployed in the future.
Over the last few years, the Ministry of Defence has been successful in trialling and perfecting laser-directed energy weapons which, with such low running costs, have huge potential to strengthen the UK’s defence capabilities. DragonFire is a symbol of the MoD’s ability to remain at the cutting edge of innovation, and I therefore wonder whether there is scope to see other areas, such as innovating around laser-directed systems, included under pillar 2 in the not-too-distant future.
The United Kingdom remains a leading military and diplomatic power and with this comes a responsibility to shape the evolution of international rules-based systems through our values, by promoting peace, encouraging stability and strengthening the rule of law. It is with this responsibility that the Government must never lose sight of the fact that AUKUS is much more than a defence pact, for it is the affirmation of this nation’s commitment to an open, free and secure world. I therefore wish the Government well in continuing the work of the previous Government in this important space and taking it further. I hope the Minister will reassure us that the next stage of AUKUS will be a key component of our national security architecture, to be more than a pact and, like Five Eyes, develop, expand and gradually bring in our partners to work together. I hope it will go beyond electoral cycles to be long lasting and there for the future.
I turn briefly to the UK-US MDA. The special relationship between the United Kingdom and US has been underpinned by the mutual defence agreement since it was first signed in 1958 and it has been a key pillar of the world-leading role that the UK and US play in promoting peace and security. The amendment and recent renewal of the MDA will ensure that our co-operation can adapt to a changing strategic, technological and legal environment. Against the challenges we face in the world today, such renewals are most welcome. We must strive to do more on joint research and development, particularly in ensuring that we have the ability to innovate so that our nuclear deterrent does not become obsolete as we face up to a future underpinned by rapid technological advance.
With war raging in Ukraine and the Middle East and tensions rising in the Indo-Pacific, the prospects of avoiding the catastrophe of global conflict continue to be strained. That is why agreements such as these must not simply be words on paper but the actions and resolve of the United Kingdom and her allies.
Lord Verdirame (Non-Afl)
My Lords, I welcome this debate. I support the ratification of these treaties, which I too consider to be in our national interest, as previous speakers have remarked. I am grateful to the noble and learned Lord, Lord Goldsmith, and the International Agreements Committee for their informative analysis of these treaties in their second and third reports.
As has been pointed out, the main amendment to the UK-US MDA is to Article III bis, a key provision in the treaty which was added in 1959. It regulates the transfer of non-nuclear components and nuclear materials from the US to the UK and from the UK to the US. This provision historically had a sunset clause, which effectively meant that a new agreement had to be concluded before the expiration of the deadline. Article 5 of the amendment agreement will remove the sunset clause.
In the debate on the strategic defence review, the noble Lord, Lord Coaker, said that he would explain the reasons for making this arrangement indefinite. I very much look forward to his explanation, with which I suspect to find myself in agreement because it seems to me that an indefinite agreement is appropriate in this context given the strategic importance of our alliance with the United States and in light of the commitments under the AUKUS agreement on naval nuclear propulsion. Moreover, making the arrangement indefinite is consistent with the nature of the co-operation that the MDA, in particular Article III bis, provided for.
In some ways, the sunset clause seemed rather out of place in this kind of treaty because, in reality, terminating the envisaged nuclear co-operation would always have required an agreement between the parties and a staged process. This is reflected in the terms of Article XII, which deals with duration. It provides that the treaty
“shall remain in force until terminated by agreement of both Parties”.
It does not provide for unilateral termination except in the case of one provision—Article II. I also note that Article 13 of the amendment agreement adds some important changes to Article XII on duration that provide precisely for the kind of staged process that termination would inevitably require. Removal of the sunset clause is the right decision and is also consistent with the legal architecture of this treaty. I commend the Government on securing this change.
That said, as the noble and learned Lord, Lord Goldsmith, so clearly explained, a consequence of this change is that the MDA will not come to Parliament every 10 years or so. In light of that, I strongly support the committee’s critical conclusion that the Government should provide a report to Parliament on the progress and operation of the MDA every 10 years or so. I hope the Minister can reassure us in that regard.
I also endorse the comments of the noble and learned Lord, Lord Goldsmith, and the noble Lords, Lord Hannay and Lord Udny-Lister, on the inadequacy of our ratification process, which these treaties have brought into sharp relief.
The other point that I wish to make that relates to both treaties concerns our obligations under the nuclear non-proliferation treaty. I agree with the Government that neither the MDA nor AUKUS would put us in breach of our obligations under the NPT. This is a very important subject and I am grateful to the Government for the attention they have given to it, including in the evidence that they submitted to the committee.
I was counsel for the UK 10 years ago in the case that the Marshall Islands brought against the UK concerning our obligations to negotiate towards nuclear disarmament. That case was brought before the International Court of Justice against all nuclear weapon states. Most nuclear weapon states had an easy way out of that litigation, but we did not take it, because we accepted the compulsory jurisdiction of the court. We had to defend the UK’s position, which we did successfully.
Since then, it is fair to say that the international landscape of nuclear proliferation has become far more challenging. The risks of nuclear proliferation are greater, as illustrated by North Korea and Iran. Moreover, crucially, the impatience of non-nuclear weapon states towards nuclear weapon states has grown, as reflected in the conclusion of the Treaty on the Prohibition of Nuclear Weapons—the TPNW—which was adopted in 2017 and has already secured 94 signatures and 73 accessions or ratifications. For obvious reasons, the United Kingdom and the United States are not going to become parties to that treaty. The NPT is the only treaty that brings together nuclear weapon states and non-nuclear weapon states, and offers us the best chance of managing the risk of nuclear proliferation. However, the NPT will not survive unless nuclear weapon states continue to engage with it. That is a position that I am sure still enjoys support across the political divide. I note that a former senior adviser in arms control in the Trump Administration, Dr Tom Grant, has recently made the case for the NPT in a book entitled Nuclear Arms Control in Peril: Why the Nuclear Non-Proliferation Treaty Matters and How to Save It.
Whether we are progressive realists or realists, we need the NPT and we need to keep it relevant. For that reason, I welcome the engagement of the Government with the case made in relation to these treaties concerning our obligations under the NPT.
Lord Bilimoria (CB)
My Lords, AUKUS is of course an acronym for the trilateral security partnership between Australia, the United Kingdom and the United States. There are two pillars of defence: first, a conventionally armed nuclear-powered submarine fleet for Australia, supported by the UK and the USA; secondly, co-operation in advanced capability, including AI.
As a trustee of Policy Exchange, I can say that we coined the term Indo-Pacific as opposed to Asia-Pacific, as it used to be referred to. With the UK’s renewed policy focus on the Indo-Pacific, that is timely. We have joined the CPTPP. We should also join the Quad, with India, the USA, Japan and Australia, making it Quad Plus, circling the world. Does the Minister agree? That would enhance our membership of NATO and Five Eyes, and our security would be greatly enhanced, but—I will come back to this later—we should spend 3% of our GDP on defence. Our Armed Forces—the Army, the Navy and the Air Force—are far too small in numbers of people; I say that as a proud honorary group captain in 601 Squadron of the RAF.
Prime Minister Rishi Sunak assured us in March 2023 that an additional £5 billion would be provided by the MoD for the AUKUS programme and that sustained funding would be provided. Can the Minister confirm that? The Government have also said that this would create thousands of jobs here in the UK and in Australia.
Gideon Rachman wrote an excellent article in the FT this February in which he said:
“China has repeatedly attacked Aukus as dangerous and confrontational. Shortly after it was launched, Boris Johnson, Britain’s prime minister at the time, gleefully lampooned the ‘raucous squawkus from the anti-Aukus caucus’”.
He concluded:
“The pact is ultimately a statement of resolve and long-term commitment. It is based on a shared perception of the growing strategic threat from China and Russia as they work together to overturn the current international order. That perception seems more pressing and valid than ever”.
He said that in February, and it is truer than ever now.
The noble Lord, Lord Risby, who led a debate on AUKUS in February this year, referred to AUKUS as a “technology accelerator”. I think that is fantastic, because there is huge potential in enhancing our security but also powering ahead with our innovation and research and development capabilities—all things that this country has always been fantastic at.
When I was president of the CBI, one of my priorities was to promote government, business and universities working together, not just in the UK but across borders. As chancellor of the University of Birmingham, I was very proud when we won two Queen’s Anniversary Prizes, one of them for Rolls-Royce and its work in aero engines. We have seen time and again that when you do cross-border collaboration between two universities—in Birmingham’s case, with Panjab University in India or with Harvard University in the United States—the field-weighted impact of collaborative research is three times higher than if the university does it on its own. Could the Government through AUKUS promote this cross-border, collaborative approach, with universities, government and business working together?
Pillar 1 of AUKUS focuses on supporting Australia to acquire its first conventionally armed nuclear-powered submarine fleet, as the noble and learned Lord, Lord Goldsmith, said in his excellent opening speech. It does not involve the transfer of nuclear weapons to Australia. Pillar 2 focuses on co-operation in eight advanced military capability areas: artificial intelligence, quantum technologies, innovation, information-sharing, cyber, undersea, hypersonic and counter-hypersonic, and electronic warfare domains.
The UK-US mutual defence agreement, which many noble Lords spoke about, was established in 1958 for co-operation on nuclear materials, technology and defence and is meant to be renewed every 10 years. This seeks to extend naval nuclear propulsion co-operation to all naval vessels, and the proposal now removes the 10-year renewal requirement for Article III bis—as the noble and learned Lord, Lord Goldsmith, mentioned—allowing continuous co-operation. We have been assured of the Government’s commitment to transparency and parliamentary accountability within national security limits. However, there are concerns over reduced parliamentary oversight with the removal of routine reviews of Article III bis. That is worrying. Here is a fact: the MDA amendments would lessen routine parliamentary scrutiny. On the other hand, the United States Congress will conduct far more rigorous scrutiny than us over here in the UK Parliament. Do the Government feel that this is a healthy position to be in?
Pillar 1 focuses on Australia’s acquisition of a nuclear-powered submarine fleet, leveraging UK submarine design and technology, with £3 billion allocated over two years. Pillar 2 emphasises developing advanced capabilities—AI, hypersonic and quantum technology, as I said earlier—and enhances interoperability among armed forces. The UK hosted the first AUKUS AI trial in April 2023, demonstrating this military collaboration, which I will come to later.
However, concerns exist about US export regulations impacting co-operation. An open general licence was issued for AUKUS nations as of 1 September 2024, and the Minister, Luke Pollard, outlined ongoing efforts with AUKUS partners to develop undersea capabilities, including launching and recovering uncrewed underwater systems from British and American submarines, integrating this into the SSN-AUKUS design.
The traditional NATO structure was to be a deterrent to Soviet expansion, but with AUKUS members there are huge incentives: for Australia, the concerns over China’s military growth and sovereignty threats; for the UK, to deepen our ties with the United States, enhance military collaboration and expand Pacific exports; for the United States, to maintain military dominance against rising Chinese and Russian assertiveness.
On Australia’s industry capacity constraints, there is scepticism in some quarters in Australia about AUKUS that we continue to need to address. The evolution of AUKUS could yield a new form of plurilateral defence alliance, addressing collaborative military capability needs and the emphasis on flexible investments in inter- operable military capabilities to adapt to geopolitical threats. This also strengthens the UK’s position in global security and military collaboration, and opportunities for technological advancement and military exports, particularly in the Indo-Pacific.
For over 65 years, the UK and the US have co-operated on defence nuclear issues. Established as an amendment to the post-World War II US non-proliferation law, the MDA exempts allies from making significant advancements in nuclear weapons from the general ban on exchange leading to proliferation.
I will be absolutely clear about the three amendments. Article 4 makes naval nuclear propulsion co-operation reciprocal, allowing the UK to share technology and information with the US. Article 5 removes the expiry provisions of Article III bis, allowing the MDA to remain in force on an “enduring basis”, which I have spoken about, and eliminating the 10-year renewal requirement. Article 13 ensures that the information, material or equipment shared under the MDA will remain protected if terminated by either party in the future. But no one has mentioned this: a joint nuclear skills plan aims to double apprentices in the sector, enhancing the workforce. We have a Budget coming up. I hope that the Government address the huge flaws in our apprentice system. The apprenticeship levy needs to be reformed wholesale, and with regard to AUKUS. Does the Minister agree?
The review will maintain UK defence ties in the Indo-Pacific, prioritising objectives to create a deliverable defence plan supporting AUKUS. Is this a separate plan? Will it be apart from the strategic defence review or part of it?
As I mentioned earlier, we had a world first as the UK hosted the inaugural AUKUS AI and autonomy trial. This exemplified strong trilateral co-operation in AI capabilities, enhancing operational effectiveness and decision-making speed. Over 70 military and civilian defence personnel and industry contractors participated in the AUKUS AI trial, involving various air and ground vehicles. Milestones included live retraining of AI models inflight and immediate sharing of updated information among AUKUS partners, which is tremendous news.
The reforms will lift export controls, potentially covering £500 million of UK defence exports annually. The UK has issued an open general licence, easing licensing requirements for advanced defence capabilities and technical data among AUKUS partners.
The noble Lord, Lord Hannan, referred to this: there are discussions about expanding AUKUS to Canada, South Korea, Japan and New Zealand, but I am led to believe that these nations are not yet ready to proceed. Could the Minister confirm whether the Government are encouraging this expansion? US export regulations, particularly ITAR, hinder collaborative defence innovation, posing significant challenges for AUKUS. Could he address that issue?
In 2019, in the debate on NATO’s 70th anniversary, I said that we should spend 3% of GDP on defence. I said that five years ago, and I have been like a stuck record ever since. The MoD is facing funding challenges. Our defence budget today is £54.2 billion. Our spending on defence was higher in real terms in 2010, at £57 billion, than today. That was a golden era for our Chinese relationship and with no threat from Russia and Ukraine. There was not a huge conflict going on in the Middle East, as we have today. We are spending too little on defence.
Our full-time Armed Forces number 192,760 in total—Army, Navy and Air Force combined. I have said this time and again: my father’s army, the central army in India, was 350,000 strong. In the debate on the strategic defence review earlier this month, the noble and gallant Lord, Lord Stirrup, said that we have a
“shrinking and hollowing out of our Armed Forces”,—[Official Report, 9/10/24; col. GC 226.]
and the noble Lord, Lord West, said that
“money was the elephant in the room”.—[Official Report, 9/10/24; col. GC 227.]
I concluded my speech by saying that:
“The price of freedom is not free”.—[Official Report, 9/10/24; col. GC 250.]
Lord Howell of Guildford (Con)
My Lords, I congratulate the noble and learned Lord, Lord Goldsmith, on not only the skill with which he introduced this debate but his patience and skill in presiding over the whole business of producing these agreements. I do not know whether it is realised what a cascade of international agreements and treaties pass through the hands of the committee and our excellent staff. It is enormous and seems to be growing. Some of them are gloriously minimalist, such as worrying about driving licences for British citizens in Portugal after Brexit; I know it is important, but it is very small. Some look simple, but are actually enormous and have vast hinterlands of implications behind them. The words in the treaties may be simple, but what lies behind them is enormously significant for the future of this country.
These two agreements that we are looking at—the MDA and the AUKUS agreement—are definitely both in that second category. I am not sure that that is fully appreciated or realised by the machinery which enables us to have a debate here in the Moses Room. These are giant issues that will shape the entire future of our nation and its safety and security. Neither of them has really been given anything like the adequate time needed to go into the thinking behind them and where they are heading.
As the noble Lord, Lord Hannay, eloquently said, the whole Constitutional Reform and Governance Act process—the CRaG process—really will not do any more, I am sorry to say. Some of us pressed the previous Government and are pressing the present Government on this. In this populist age, if we want our Parliament to perform, be trusted and be able to genuinely scrutinise major issues and acts of the Executive, we have to go back to that Act and reform it. I hope that will be a high priority for the new Government.
At first glance, these two treaties look quite separate from each other, but they in fact overlap, not only in not being given enough time to be examined but in that, together, they raise enormous questions about the pattern of our future war weaponry, defence equipment and entire security stance in a totally changed world in which power has changed, threats are coming from different directions from ever before and in unfamiliar forms. Many people do not seem to be geared towards this entirely new situation.
Again, as the noble Lord, Lord Hannay, and others said, the MDA takes away the 10-year rule and the chance for Parliament to scrutinise an enormously rapidly evolving world of nuclear weaponry and technology—and, of course, civil nuclear technology as well. I am not sure that Congress in the United States or the Parliament of Australia—or, if there are any newcomers to AUKUS, the Parliament of Canada or Diet of Japan—would put up with this sort of thing. They would not tolerate a truncated, short session after which the Executive carry on as before, which is more or less what happens. This is a very unsatisfactory situation, which is very bad for Parliament and will, I hope, be changed.
As for the AUKUS naval treaty, it is all to do with nuclear marine propulsion—not to be confused with nuclear weapons, of course—for a new generation of submarine vehicles for the Australians. It looks quite small; it is mostly about pillar 1 of the two pillars of the AUKUS treaty but, if you start looking at the implications of AUKUS 1—and indeed, AUKUS 2, which will presumably be covered by the same sorts of agreements in due course—you see that it takes us into a new defence world altogether. It is a vast Aladdin’s cave of new technologies, some of which hardly ever come into the media discussion because they are not understood. Some of them are already being used: there was a gentleman here from Ukraine last week who informed some of us that the military plus semi-private enterprise organisations, which organise the battlefield planning for the Ukrainians on all their fronts, are now also in control of the direction, effects and supply of about a million drones. That covers, if you think about it, the control of their production, maybe in remote spots, their deployment, their decision to go into Russian territory and all the rest. That is beyond what any Government or any military organisation can manage alone. It now has to be managed by a whole series of fascinating new enterprises of vast complexity, all relying on the very latest technologies of every kind, including AI, to see that there is a flow and supply chain of drones, and that they go in roughly the right direction. Of course, they are not always co-ordinated at all, which produces some quite sensitive results.
Nevertheless, we are looking at is an entirely different defence world and, as I said, an Aladdin’s cave of new technology. I have just glanced through pillar 2, which is relevant to pillar 1 and the AUKUS treaty. Pillar 2 refers to advanced capabilities, the areas in which we, the British, are now implicating ourselves, not sacrificing sovereignty in a major way but nevertheless weaving our future defence plans into other people’s—America’s and Australia’s. It is welcome and good, but we should be aware of it in a way that I do not think we are.
First, “undersea capabilities” sounds innocent enough. What that is to do with is whether submarines are going to cut our north Atlantic and Atlantic cables and literally slice off the entire British economy. That is a major consideration, fear and danger. The development of proper undersea capabilities and unmanned submarines in due course, which are also on the list for discussion, is a central part of our national survival.
Quantum technology obviously comes at the centre of this, described by the previous Government as a priority of our defence development. Artificial intelligence and autonomy are obvious ones. Advanced cyber is already going ahead, and then there are hypersonic and counter-hypersonic capabilities, which are desperately needed, as the affairs in the Middle East demonstrate particularly clearly. There is all the electronic warfare and innovation of every kind, in relation to the traditional visions of defence, including tanks, rockets, soldiers, guns, warfare, battleships and so on—all that sort of thing—with electronic co-ordination, in entirely new ways. There is information-sharing, which of course is intelligence, and advanced radar, in which we were once the world leaders—but now of course the Americans have rather taken over, and the Russians as well. They are particularly well advanced in radar. These are areas that are not usually associated in people’s minds with defence, yet this is the defence of tomorrow, and this is where we are being taken by the two treaties that we are discussing today.
It is a very new area indeed. I cannot help feeling how maddened Mr Putin must be when he was talked into going into Ukraine by generals who probably did not have the slightest idea what they were heading towards—the idea that there could be 1 million drones halting all their attack advances and causing chaos, and the idea that they themselves had to invent new technologies in drones, as the Russians have done with some success. That is something that he must regret bitterly now.
Eric Schmidt, the former head of Google, was remarking in Foreign Affairs a couple of days ago that the US is unprepared for this sort of world and pattern, and he urged certain changes. Obviously, Russia was completely unprepared and has been caught hopping, and Ukraine has had to invent itself as a new force based on these new technologies, totally different from anything that we have ever known before, even though there are a few relics of the old technologies—like the Battle of the Somme and trench warfare. That goes on, but on top of it an entirely new pattern of hostilities and conflict has emerged, with autonomous weapons driven by gigantic algorithms now dominating the scene.
Putin regrets it, and America may be trying to get ready. I hope that we are ready, although you do not hear much about it, and perhaps the Minister will have a word or two to add to the debate today. I think that we are bright and resilient enough not to fall into the same trap. As long as Parliament is given a chance to speak, and the experts in Parliament—and, dare I say it, the experts in your Lordships’ House—at the right times, we shall be able to keep up with affairs. If the MDA will not allow a 10-year review automatically, so what? We can put down a few Motions and have a debate ourselves every 10 years. Actually, I think we will need one every five years, because these things are evolving so fast.
As I said, we must not fall into the old trap of fighting the last war with the last war’s weapons. It is an entirely new world, and these treaties open the gates to understanding it in a more effective way. To finish, I add—rather impertinently and cheekily, because I belong to a rather defeated party at the moment—that I hope all our new Ministers will remember that they are also parliamentarians.
Baroness Bennett of Manor Castle (GP)
My Lords, it is a great pleasure to follow the noble Lord, Lord Howell of Guildford. I agree very much with his introductory remarks about the huge democratic deficit represented by the CRaG process—remarks echoed by most noble Lords taking part in this debate. Democracy? It would be a good idea; I hope most people would agree. I also agree very much with his concluding remarks that we are in a new world and we need new approaches. What we have before us looks very much like something out of the 20th century, rather than being fit for the 21st.
I thank the noble and learned Lord, Lord Goldsmith, and the International Agreements Committee, for their hard and rapid work in preparing the report, securing this debate and introducing it so clearly.
I note that the scrutiny period for the MDA ends on 23 October, which is today, and, for the AUKUS agreement, on 29 October. I might use a hashtag that I use frequently on social media: #NoWayToRunACountry. It would be nice to have more space and time for discussion and thought.
As the noble and learned Lord, Lord Goldsmith, set out, this debate occurs as the UK prepares to spend, and is spending, an enormous amount of money on new nuclear weapons. I must put on the record the Green Party’s opposition to the huge expense and risks of the Trident replacement programme in a geopolitical environment in which the majority of the world’s countries have backed the UN treaty for a global ban on nuclear weapons. I also note the related context in which the cost of the nuclear clean-up at Sellafield has spiralled to £136 billion, about which the National Audit Office has today expressed great concern. This is on a site where there have been very serious cybersecurity concerns and on which we have yet to find any kind of long-term solution for the storage of nuclear waste.
However, I will focus in particular on the AUKUS agreement, in part because the perspective of the Green Party of England and Wales lines up very much with that of the Australian Greens. We bring a different and widely supported voice to the debate in both our nations. Both our parties are opposed to the agreement, and that gives me the opportunity to draw the Committee’s attention to some important points that should, I respectfully suggest, give the Government and all parties pause.
I note by way of background that, in 2022, the Australian Greens had by far their best ever federal election result, labelled a “greenslide” by the leader, Adam Bandt. It saw the election of the first three Green MPs in Brisbane and a significant increase in Senate numbers, and state-elected representation has continued to grow since then. We are in a time of considerable political change in the UK, the US and around the world.
I also note, as I have previously noted to this committee, that two former Australian Prime Ministers and one former Australian Foreign Minister, who are not Greens, have all opposed the AUKUS deal.
I will begin with a longue-durée view and look over more than a century of Australian and UK military co-operation, which has been marked often by strong, even slavish, support for UK and US actions from the top of the Australian Government, although that has not always been backed by, or first checked with, the Australian public.
My speech might be taken as a balance and contrast to that of the noble Lord, Lord Hannan, not for the first time. First, I refer to the First World War. ANZAC Day on 25 April now marks the contribution of all those who have served militarily in Australia, but was initially founded very much around trying to get more people to sign up to the war, as historian Martin Crotty said, between 1916 and 1918, after the British-led military disaster of Gallipoli that claimed so many young lives, The Prime Minister of Australia, Billy Hughes, tried twice to extend service for conscripts outside Australian shores to feed more lives into the horrors of the trenches. When the flow of volunteers dried up, twice, the Australian public said no, and I note in passing that the Australian Labor Party subsequently split.
On 3 September 1939, Prime Minister Robert Menzies told the Australian people that they were at war with Nazi Germany. That came just an hour after Britain had declared war. While there is no doubt that the Australian public was, and remained, behind the Government, there was considerable concern and doubt, as there had been in the then dominions of Canada and South Africa, about the Australian Prime Minister’s assumption of automaticity. The slavish abandonment of any idea of Australian sovereignty has echoes which I will come back to.
Without doing a detailed trawl through Australian history, I will just stop briefly at the Vietnam war moratorium protests, the first of which took place on the 8 May 1970. These were then the largest public demonstrations in Australia’s history and represented growing resistance from a significant number of Australians to the Government’s commitment to the Vietnam War in general and conscription in particular. On 16 February 2003, more than half a million people took part in protests across Australia against the US-led invasion of Iraq, the largest anti-war protests in Australia’s history. The Committee can see the pattern that I am drawing out here and should perhaps reflect that Australia is, however imperfectly, a democracy and there is a strong chance that public views may eventually influence political choices.
Australian officials believe, and it has been widely acknowledged, although it is extremely hard to estimate the cost of the AUKUS programme over its life, that the long-term cost of the submarine plan is likely to be about 0.15% of Australia’s entire gross domestic product per year, on average. For context, in 2023, that was put as a comparable cost to boosting the resourcing of schools across the entire nation to what was seen to be an essential minimum standard. But the objections are not just about costs. I draw noble Lords’ attention to the Australian Greens’ dissenting report to the Senate Committee on Foreign Affairs, Defence and Trade’s report on the Defence Legislation Amendment (Naval Nuclear Propulsion) Bill 2023. The dissenting report is readily available, so I will not discuss it at length but pick out a couple of key points. First, it states:
“There are environmental, health, security and social risks associated with every facet of the nuclear industry. These risks disproportionately impact First Nations peoples and their lands.”
I note that the very much unfinished business of the treatment of First Nations in Australia has recently been strongly highlighted. The report then states,
“that the two major parties have worked together to ensure a short time frame on the reporting of this inquiry and not enabled time for public hearings … the Australian public has not been properly consulted on the AUKUS proposal”.
We can see the clear echo here at the complaints that we have heard across this Committee. The report concludes that the deal undermines Australian sovereignty and violates international nuclear safety principles, and notes that Australia’s Defence Strategic Review rejected advice from the International Atomic Energy Agency and the Australian Government’s own nuclear safety advisory council, which recommended that an independent regulator have oversight of the programme.
Finally, the report notes:
“The Australian public has rejected … nuclearisation … for nearly a century”.
It might be of particular interest to the Government that the Electrical Trades Union and the Australian Manufacturing Workers’ Union, two prominent Australian unions, strongly oppose the development of a nuclear industry in Australia or any end to the moratorium on nuclear power. That is the political context of the AUKUS deal. Noble Lords might think that that presents considerable political risks: they would be right.
I also note that that reflects the conclusion of a report published in the last week by the US Congressional Research Service, which says of the military context that
“the costs … of Pillar 1 could reduce, perhaps significantly, funding … for other Australian military capabilities”.
Crucially, it says that no alternatives were ever considered by any of the AUKUS partners. We come back to democratic scrutiny and consideration. To repeat, this report was from the US Congressional Research Service.
Finally, the timing of this debate all too acutely highlights the geopolitical context, of which our relationship with Australia is a small if significant part. There is the approaching US election, in which there is at least an even-money chance that we will see a second Donald Trump presidency and a risk that, even if that is not the result, we will see that candidate seeking to claim the presidency. I will not get into the details of today’s row, but this is not a politically stable time in US history to be making deals such as either of these. At the CHOGM meeting in Samoa, for which our Prime Minister may just about have landed after 26 hours, he will not be joined by the leaders of India or South Africa, because they are at the BRICS meeting hosted by the Russian President, Vladimir Putin, in Kazan, where the Chinese President, Xi Jinping, is also in attendance. Canada too is sending neither its Prime Minister nor Foreign Minister to CHOGM.
As I said in our debate on the defence review, the UK needs to consider far more than defence in isolation. It needs to consider its place and relationships in a world of multiple security threats—not just the Russian invasion of Ukraine and the threats that China presents with its denial of the joint declaration in Hong Kong and the threats to the democratic entity of Taiwan, but the multiple security threats of the climate emergency, the nature crisis and multiple health threats. I draw attention to an extremely disturbing report in Vanity Fair about the H5N1 virus in US dairy herds and that country’s wholly inadequate public health response.
The agreements we are debating today already look like 20th-century relics, and in future will likely look even more so, sitting dangerously, expensively and unstably in the 21st-century world. The security of our country and the world cannot afford such outdated approaches.
Lord Stevens of Birmingham (CB)
I am very pleased to follow the noble Baroness, Lady Bennett, not least because she has spurred all kinds of reactions in my mind to the “Address to the Australian Parliament” which we have just heard. It is a stretch to say that the decision to renew the strategic deterrent lacks democratic legitimacy in this country, when it was explicitly voted on by the House of Commons in 2016; when the people of this country had a choice, in 2019, whether to elect the leader of one of our principal political parties who had an obvious preference against nuclear weapons; and when, in the 2024 election, her party, under good democratic principles, put before the electorate the prospect of unilaterally abandoning our nuclear weapons and I am afraid the country did not elect a Green Government. The idea that these decisions lack democratic legitimacy is itself an illegitimate argument.
It was also surprising to hear the noble Baroness, Lady Bennett, cite the US Congressional Research Service report on the AUKUS pillar 1 deal as an alternative to what is being proposed. I happen to have that report here and was just flicking through it as she was speaking. The alternative proposition that the CRS put on the table is not the absence of nuclear-powered submarines for Australia or, indeed, the downgrading of its defence expenditure so as to reinvest in other worthy projects; it is in fact to contemplate greater dependency on US basing of US-controlled Virginia-class SSNs in Australia, foregoing any sovereign oversight that the elected Australian Government of the day might have. We are here to discuss what is in Britain’s interest, not Australia’s, but I think most of us are convinced by the argument that there is a strategic need for Australia for these types of submarine services and, by pooling our technologies and resources, we will all get a better deal.
My starting point is that I accept that if we are going to have the asymmetric capability that the submarine service represents, we need to continue with our forward order book. The idea that, at some point in the late 2030s, a better, modern class of submarine will replace the A-class attack submarines that we have right now seems to me a statement of the obvious. I accept that there are legitimate debates about the affordability and management of our nuclear programme; these are not new. On 14 October, the Chancellor of the Exchequer wrote to the Prime Minister about this matter and said, “The nuclear submarine programme seems to me a very doubtful proposition. The cost is prodigious. How many of these are we likely to be able to afford? How soon can we get them? When they arrive, will they already be obsolescent?” That was on 14 October 1957 and the then Chancellor of Exchequer, Peter Thorneycroft, writing to Harold Macmillan, who fortunately ignored that ministration and the rest, as they say, is history.
So, yes, I think this makes strategic sense. However, for AUKUS pillar 1 to work, and to respond to some of political doubts that will be sowed in the minds of people in Australia, and possibly elsewhere, it is very important that the transitional elements of AUKUS, the so-called optimal pathways between now and the construction of these new submarines, also work well.
We can all use this as an opportunity to note our concerns about the pressures on the Royal Navy Submarine Service at the moment. Open-source reporting has said that some of the times at sea have almost doubled over the past three years, with a combination of difficulties of availability of submarines and retention of submariners, and we are not alone in this. The US is also experiencing difficulties in its new submarine production. Since 2022, the rate of build for the new Virginia-class subs on order has been between 1.2 and 1.4 a year, compared with the two boats a year that had been expected.
The reason this matters is because creating, as it were, the facts on the ground for AUKUS from 2027 requires rotational deployments of one of our SSNs and four of the US SSNs, so availability in the submarine services of the two countries in the here and now is very important for getting this programme under way, as of course is restarting the fuller production pipeline for Virginia-class submarines, so that they are available for the US to sell to the Australians, beginning with the three that are in play. This all needs proper scrutiny, no doubt through the strategic defence review, but it is not something that is simply a late 2030s conversation; it is something that needs careful attention, as I am sure Ministers are well aware, in the here and now.
My final point—and I declare my interest as chair of the Maritime and Coastguard Agency—is on the role that UK science and innovation in nuclear naval propulsion potentially has in the maritime civilian sector as well. There is growing interest on the part of merchant shipping and the port sector around the role that new nuclear technologies can potentially play—small modular reactors, non-enriched fuel, non-pressurised reactors for use at sea, perhaps using next-generation molten salt technology, and so forth. In the last 12 months we have seen Lloyd’s Register, Maersk and ABS all producing scoping reports for how small nuclear reactors could be used in merchant shipping, in containerisation. The reason why this matters is because, worldwide, shipping constitutes 3% of greenhouse gas emissions, about the same as aviation, but to date has received less attention in terms of what the green fuels transition will look like for shipping.
I think that it was in 1956 that we were the first country to get a civilian nuclear reactor up and going, and by the mid-1960s there were more nuclear reactors at work in civilian installations in the UK than all the rest of the world combined. As the noble Lord, Lord Bilimoria, said, the programme that has been set out around skills development, nuclear engineering and the broader clusters that go around this set of technologies, which are implicit in AUKUS and the agreements before us today, also have profound benefits—spillover benefits, potentially—in other applications, including at sea.
This is an area that will be entirely worthy of investment. The noble Lord, Lord Bilimoria, said that money was the elephant in the room. Perhaps to the noble Lord, Lord Coaker, when this question is being debated with the Treasury, there is an example that he might call to mind. Apparently, when Lord Mountbatten was having this argument with a different Chancellor of the Exchequer at that point, he produced a 20-inch model of a nuclear submarine, which opened up with a little compartment. During the entirety of the Cabinet committee the Chancellor fiddled around, looking at it, and in the end said, “Okay, how much do you need?”
Lord Anderson of Swansea (Lab)
I am grateful to the Deputy Chairman for allowing me to speak in the gap. I had applied in proper form, but alas, there was a misunderstanding in the Government Whips’ Office. So here I am, and I am grateful.
I begin by congratulating my noble and learned friend Lord Goldsmith. He follows in the proud tradition of my noble friend Lady Hayter and my very good and late friend Lord Morris of Aberavon.
The report on the MDA gives some indication of the importance of the scrutiny role of the committee and, as the noble Lord, Lord Howell, and others mentioned, of the deficiencies in the current CRaG process—a point also made very well by my noble and learned friend Lord Goldsmith.
The agreement is absolutely fundamental to the excellent defence relationships between our two countries. The MDA provides for the exchange of nuclear material, technology and information, and the debate is also very timely, in that the UK is in the process of modernising its nuclear-powered submarine and the warheads.
This has been a unique defence and security relationship between us and the US. We have heard quite a lot of history during this debate. The McMahon Act 1946 banned the US from sharing its nuclear knowledge. That was modified in 1958, and co-operation then between the UK and the US was a precursor to the Polaris agreement of 1963.
I noted that in the presidential determination of 16 July recommending approval of the amendment, President Biden stated that it was in the interests of the US to continue to assist the UK in maintaining a credible nuclear deterrent,
“which will further improve our mutual defense posture and support our”
collective interests under NATO. It appears clear, from what we have heard as a committee, that the US will indeed shortly ratify these amendments.
As an aside, many years ago, in 1960, I joined the Foreign Office, and what struck me very forcefully at the time was the excellent personal relationships between members of the US Administration and senior members of the Foreign Office, many of whom had served in the US during the war—people such as Sir Frank Lee and Sir Arnold France—and had built up excellent personal relationships. Alas, I do not believe that those personal relationships, which inspire confidence and trust, exist in quite the same way today.
Pace the noble Lord, Lord Hannan, it may well be that, in the current context, the US might be looking not just at the UK for that special relationship but at France and possibly other countries. France was, of course, upended by the AUKUS agreement and may well be brought in now, in some subsidiary way.
Power relationships and the context of today are very different from 1958 and 1959. I hope that the Government will indicate whether they foresee a possible change if there were to be a change of government in the US following the presidential election.
The Parliamentary Under-Secretary of State, Ministry of Justice (Lord Ponsonby of Shulbrede) (Lab)
I point out to my noble friend that there is a four-minute time limit to interventions in the gap.
Lord Anderson of Swansea (Lab)
In that case I end simply by stating—although there is plenty of time left—that there is clearly concern about parliamentary oversight. When the committee met Mr Pitt-Rashid of the MoD, he conceded that the removal of this amendment was “not a great disadvantage”. Surely we would not expect the US to be concerned about our parliamentary procedure, nor should we be concerned about the US. Its removal can be done without difficulty.
I make one point in relation to the noble Lord, Lord Verdirame. The question of relying on a Minister to give an assurance is fundamentally different from having an obligation set in statute.
Baroness Smith of Newnham (LD)
My Lords, I welcome the opportunity to debate AUKUS, the MDA and the work of the International Agreements Committee. It has been nothing if not a wide-ranging debate this afternoon. We have ranged through decades of history and travelled the globe, yet much of the debate has been narrowly focused on ourselves and our parliamentary role to scrutinise international treaties.
I very much welcome the opportunity for these discussions. Somewhat like the noble Lord, Lord Hannay, I will try to give a slight corrective to the noble Lord, Lord Hannan. He talked about the Anglosphere and how important it is that these treaties are with our oldest friends, those who speak English. The treaty that has not been mentioned today, either in the Chamber or here, will, I hope, be scrutinised within 21 days from when it is laid. The UK-Germany Trinity House Agreement on Defence was agreed today and will be part of a wider treaty with Germany. As the Foreign Office no longer has such close ties with our American counterparts in the State Department, I suggest that the new Government, to whom I pay tribute, have already done an incredible job at strengthening relations with some of our closest European partners.
That was an aside. However, given that today’s debate has been so wide ranging, an aside to look at another defence co-operation treaty might be appropriate.
I thank the noble and learned Lord, Lord Goldsmith, for presenting not just the reports but the two agreements so clearly. They are legal documents, and his insight and expertise in presenting them to us so clearly is extremely welcome. I also put on record our thanks to the International Agreements Committee and its staff because, as we heard from many noble Lords, the agreements have to be reviewed so quickly.
It is important that we all put on record the one area of agreement, because almost every noble Lord commented on the CRaG process and expressed significant concerns. In the words that the noble Lord, Lord Hannay, used, we had an absurdly short amount of time. If we are going to look at international treaties, we need to have the right amount of time to allow the International Agreements Committee to review them and take evidence. This is not a criticism of either the present Government or indeed their predecessor. The CRaG Act clearly needs to be looked at again. Unlike the noble Baroness, Lady Bennett of Manor Castle, I am not in any way suggesting that the Government have deliberately chosen not to give sufficient time for scrutiny, but the procedures do not work adequately. If there is one unanimous message for the Minister to take back to the usual channels, it must be that the CRaG Act needs to be looked at, and more time should be given.
From the International Agreements Committee reports and what we have heard in the Chamber, it looks as if Congress has a much better model for allowing scrutiny. Clearly, if there are treaties that need to be decided as a matter of urgency, maybe 21 working days is appropriate, and maybe even fewer days are appropriate if something is being undertaken immediately as a matter of national security. But with the two treaties or agreements that we are looking at today, some more time could have been given, which would have allowed everyone to begin to look not just at the broad parameters of the agreements but somewhat more at their specifics.
There are a few areas that perhaps could be discussed in more detail. In particular, the reports commented on two amendments to the MDA, one of which we have heard about already—the change to Article III bis, and the idea that we will no longer have to have a review of the treaty every 10 years. The noble Lord, Lord Verdirame, very clearly said that it is appropriate that this should now be an indefinite treaty; we should not have to have 10-yearly reviews. But in this Grand Committee yesterday, three of us, in a very small group including the noble Lord, Lord Coaker, the noble Baroness, Lady Goldie, and me, discussed the Armed Forces Act 2006 (Continuation) Order, which we have to do; under the 1688 Bill of Rights, every year, Parliament renews its commitment to our Armed Forces and agrees to their continuity. While we may not want to renew the agreement every 10 years, the opportunity of at least scrutinising our agreements and ensuring that there is the opportunity for Parliament to review agreements would seem to be appropriate.
Here again there is a question about who we are asking to ensure that there can be regular scrutiny. I am sure that, if the Minister thinks that this is an ad personam request, he will very rightly say that he will commit to do this—and he is an honourable man who would undoubtedly bring reports in the way that we would expect. But we have to accept that a Parliament in 10 years might look very different, and the Government might look very different. We may not have the luxury of having such an open Administration, so having a firm commitment would be most welcome.
One area on which we have not touched at all was another point from the IAC’s report on the MDA, on Article 4, which expanded the treaty somewhat. It was one of the few areas on which the committee was able to take some evidence. We had a slightly strange response, because we heard from the MoD official that it was just about future-proofing and they did not expect very much to happen.
If Article 4 is not going to change very much, why is it needed? Does the Minister think that very much is going to change with this change? One reason for asking now is precisely that, if we are no longer going to review the MDA every 10 years, we need to be very clear now about what we have just signed up to.
On general principles, I need to put on record that these Benches have supported the AUKUS agreement. It is also important to restate the point that the noble and learned Lord, Lord Goldsmith, made very clearly in his introductory remarks: this is about an agreement that will allow nuclear-powered but conventionally weaponed submarines. The intervention from the noble Baroness, Lady Bennett of Manor Castle, seemed in some ways to elide all the nuclear questions together. While there may be arguments to have an entirely nuclear-free world, this is not about nuclear weapons. It is really important that this does not, in that sense, jeopardise the situation vis-à-vis nuclear non-proliferation.
I thought that I would nevertheless just take the opportunity of asking one question on non-proliferation, in the absence of my noble friend Lady Miller of Chilthorne Domer. When we discussed the SDR a couple of weeks ago, she raised the issue of non-proliferation. I have one question for the Minister. Given that we are committed to non-proliferation, there was a period during the coalition and Conservative Governments when the NPT review conferences—the five-year reviews—seemed to keep coinciding with general elections, as in 2010 and 2015, and not very much preparation was done. Are His Majesty’s Government already thinking about the 2026 review conference and will they play a full part? However much we support these vital nuclear agreements—the MDA and nuclear propulsion agreement with Australia —and want firm agreements with our allies in Australia and the United States, it is still important, as far as possible, to look for non-proliferation and de-escalation, particularly at a time when the number of nuclear weapon states, and the threats of using nuclear weapons, seem to be on the agenda in a way that they have not been for decades.
Baroness Goldie (Con)
My Lords, I thank the noble and learned Lord, Lord Goldsmith, and all members of the International Agreements Committee for their helpful report on the two agreements before us today. I also thank the noble and learned Lord for his very helpful introductory remarks.
I may say that I have discovered two virtues of being in opposition. One is that I am no longer sitting in the position of the noble Lord, Lord Coaker, answering all these questions. The second is that, for the first time, I have been able to enjoy the full scope and implicit message of “The Judgment of Daniel”, which made me think that Daniel was a man who came upon a problem, understood the problem, addressed the problem and got on with life. That is very much the prism through which I am looking at the AUKUS agreements.
I remember, when I was a Defence Minister, the efforts that the Government made to reach agreement with the United States and the Government of Australia on the Agreement for the Exchange of Naval Nuclear Propulsion Information, and the significance of that agreement: I felt a frisson of excitement when it was accomplished. It was intended as a temporary measure to facilitate the sharing of information for the purposes of that early 18-month study to determine the optimal pathway. This treaty is the extension of that initial arrangement that we negotiated throughout 2021.
I welcome His Majesty’s Government’s commitment to continuing the previous Conservative Government’s efforts to advance the AUKUS partnership. This agreement therefore builds upon numerous past successes in the arena of international defence co-operation, such as the establishment of NATO and the Five Eyes intelligence-sharing arrangement, among others.
We should also note the significant progress that has been made on pillar 1 of the partnership. I strongly support such a phased approach to delivery because it sets out clear and robust targets to keep progress on track. To that end, I was delighted that in January my honourable friend the then Minister for Defence Procurement, James Cartlidge, announced that £4 billion of contracts had already been allocated to UK companies for the AUKUS submarines and that in December 2023 the first Australian personnel came to Barrow-in-Furness to improve their knowledge of the production and maintenance of nuclear-powered submarines. These are all positive steps in the right direction.
I make no apology for applauding the AUKUS alliance. It is both strategically important and an impressive reflection of strong defence relationships. The partnership between the United Kingdom, the United States and Australia demonstrates this country’s commitment to the Indo-Pacific region, helping to combat new and emerging threats. It will act as a guarantor of the defence of our interests and security and support our aim of upholding the international rules-based order.
On this point, the other agreement before us today on the amendment to the mutual defence agreement also contributes to our international defence and security aims. In many ways, as noble Lords will be aware, the MDA between the UK and the United States underpins the special relationship between our two countries. It aids the reliable maintenance of the continuous at-sea deterrent and plays a key role in enabling the necessary exchange of information and technologies required for the AUKUS partnership.
As has been mentioned, the amending agreement removes the expiry date contained within the MDA. The Explanatory Memorandum states that this makes
“the entirety of the MDA enduring, securing continuing cooperation with the US”.
Ensuring continual co-operation with the US is of paramount importance, but I understand why the noble and learned Lord, Lord Goldsmith, and his committee raise the issue of parliamentary scrutiny. That scrutiny matters, as eloquently articulated by the noble Lord, Lord Hannay, and my noble friend Lord Howell. It would be reassuring—I choose my words carefully to try to help the Minister—and for the benefit of all noble Lords for the Government at least to register that concern and be prepared to explore updating Parliament routinely on the MDA and any related developments.
On the future of the AUKUS submarine building programme, it is appropriate for the Government to update noble Lords further on the steps they have been taking to ensure that the necessary industrial resources are in place and that continuing dialogue is undertaken with our partners to enable the timely progress of the programme.
Finally, as has been indicated, Article XIII states that the treaty on nuclear naval propulsion will extend all the way to 2075. Professor Donald Rothwell, when giving evidence to the Australian Parliament’s Joint Standing Committee on Treaties last week, described this as a “rather exceptional extension”. I do not think there would be much disagreement with that analysis. Given the longevity of this agreement, it may very well be necessary for additional measures to be brought forward to guarantee the flexibility of the partnership with Australia and the United States. We must make sure that these future possibilities, if they occur, are transparent and that Parliament’s scrutiny role is respected. I respectfully ask the Minister to confirm that he is cognisant of that government responsibility and that the Government will endeavour to discharge it meaningfully.
These two agreements reflect and build on the United Kingdom’s important network of defence alliances and partnerships. I look forward to continuing to support the Government as they progress these important issues, but I will rap fingers if Parliament is not kept informed about these issues.
The Minister of State, Ministry of Defence (Lord Coaker) (Lab)
My Lords, I thank the noble Baronesses, Lady Smith and Lady Goldie, for their remarks and contributions to this debate, and their general support from the Front Benches. I will deal with some of the specific questions that they asked as I go through my remarks, but I welcome their support.
Moreover, I thank my noble and learned friend Lord Goldsmith for his chairmanship of the committee and the reports he has brought forward with its support. One can see how well thought of they are by the presence here of so many members of the committee. I welcome his introduction, and I am grateful for the well-made thanks he expressed to the MoD and officials. I am also grateful to him and his committee for their overall support for the two treaties before us. I welcome the reports, which I have read in great detail, including the appendices.
I will deal with the specific recommendations later in my remarks, but I take what my noble and learned friend said about his committee intending to look at the CRaG process. I have heard the remarks of different members of the committee about it, and I take the point made forcefully and correctly by the noble Baroness, Lady Goldie, about holding the Government to account on parliamentary scrutiny. I also take the point of the noble Lord, Lord Howell, that we are all parliamentarians, even if we are Ministers. It is an important point of principle.
I say to my noble and learned friend that, if I can help in that, by informing ministerial colleagues about the process as his work goes forward, I am very happy to do so. I cannot promise an answer, but I will certainly take it forward because that is the least that he and his colleagues on the committee should expect. I am grateful to noble Lords on the committee for their thoughtful reports, and I thank all noble Lords who have contributed to our constructive debate.
The 1958 mutual defence agreement underpins the defence nuclear relationship between the UK and the US, forming the basis for our co-operation on the safe and reliable maintenance of the UK’s nuclear deterrent. It is clear that co-operation under the MDA has been of considerable mutual benefit, supporting both countries to maintain operationally independent deterrents. It is in the national and security interests of the UK and the US to continue this long-standing agreement. The Prime Minister has been clear that the nuclear deterrent is the foundation of any plan to keep Britain safe. As our world has grown more volatile and insecure, we are reminded that the cost of our nuclear deterrent is a price worth paying.
That brings us to today. We have confirmed delivery of our triple-lock nuclear guarantee, which will upgrade our nuclear deterrent for future generations, and the crucial role that our nuclear co-operation with the United States will play. I think it was the noble Lord, Lord Udny-Lister, who mentioned the nuclear deterrent. It remains absolutely central to our defensive posture. We are committed to the modernisation of our deterrent and to the relationship between our countries.
I cannot agree with the points made by the noble Baroness, Lady Bennett, about the nuclear deterrent, but I am glad I live in a country where she can freely make those points and campaign for them. I think we all respect her for the way in which she does so. Without being patronising, I want to say that it is important that she continues to make those points and challenge those of us who do not agree with her. The democratic principle that she can make those points and be heard with respect in our Chamber is important.
Our nuclear co-operation with the US is underpinned by the mutual defence agreement, which allows us to exchange nuclear materials, technology and information. Its strategic value is self-evident. The amendment to remove the 10-year renewal provision and broaden the types of information exchanged under the agreement reflects the maturity and trust that characterises our relationship with the United States, while preserving the parties’ rights to agree amendments or terminate the agreement, in accordance with its terms. That is an important point to make.
I am grateful to the noble Lord, Lord Verdirame, for his support for the change to the agreement. It is important for us to recognise that the removal of the renewal provisions associated with Article III bis represent one of the key amendments to the treaty; the other being clarification of the types of information that can be exchanged under the agreement. As noble Lords will be aware, Article III bis, with its associated renewal provision, was first introduced into the agreement in 1959. The remainder of the treaty has endured since 1958. There is no clear programmatic reason in either the UK or the US that has driven this particular renewal period, which at times has varied from five to 10 years. Both the US and the UK agreed that removal of this renewal provision was a priority for this amendment, having regard for the fact that there is no operational or other requirement for it—reflecting, of course, the maturity and trust that characterises our relationship. I will come to the point about parliamentary scrutiny later in my remarks.
Our amendments to the naval nuclear propulsion clauses will consolidate the reciprocal transfer of equipment, information and material that will benefit our fleet. The amendments to the treaty do not impose any additional financial commitments on the UK, nor do they commit us to buying any goods or services from the US. Indeed, the UK’s long-running nuclear co-operation with the US under the agreement has reduced the cost of our nuclear deterrent capability. Recognising the concerns that some noble Lords here and outside have regarding our NPT commitments, I can reassure all noble Lords that all activity under the amended mutual defence agreement will remain consistent with the UK’s obligations under the non-proliferation treaty. Again, I note the support of the noble Lord, Lord Verdirame, with respect to that. In particular, as other noble Lords have noted—I want to make it clear the Dispatch Box for the Government—there is no movement of nuclear weapons or new nuclear explosive devices under the mutual defence agreement. Further, the agreement does not represent an indefinite commitment to the possession of nuclear weapons by the UK.
We remain committed to the long-term goal of a world without nuclear weapons in a transparent, verifiable and irreversible manner, with undiminished security for all. In answer to the direct question of the noble Baroness, Lady Smith, yes, we are preparing for the 2026 NPT review conference. We understand completely the concerns of the noble and learned Lord, Lord Goldsmith, and the committee, and as raised by a number of Members, regarding the periodic scrutiny of the mutual defence agreement. The noble Baroness, Lady Goldie, raised the point as well. In particular, we and I have noted the committee’s recommendation to provide a report to Parliament on the progress and operation of the MDA every 10 years. In principle, we are content to explore how we can satisfy the intent of the committee and a formal government response will be provided in due course. I say to the noble and learned Lord, Lord Goldsmith, and other noble Lords, that I will ensure that this happens.
The noble Lords, Lord Hannay and Lord Howell, and the noble Baroness, Lady Goldie raised another important point. I can reassure them, as I have said before, that any future amendments to the mutual defence agreement that fall within the scope of the Constitutional Reform and Governance Act 2010 would be subject to parliamentary scrutiny in the normal way.
I turn to the AUKUS naval nuclear propulsion agreement and note that a large number of your Lordships recognise its importance. They included the noble Lords, Lord Hannan, Lord Hannay, Lord Udny-Lister, Lord Bilimoria, Lord Stevens and Lord Howell, and the noble Baronesses, Lady Bennett, Lady Smith and Lady Goldie, and indeed my noble friend Lord Anderson. Many others mentioned the importance of this.
This recognises the importance of the Indo-Pacific. We have a NATO-first policy as a Government, but the Indo-Pacific remains important to us, through the signing of the AUKUS agreement. I just say in passing that His Majesty’s Government’s carrier strike group will be going to the Indo-Pacific next year, with many of our international partners, as an important statement of our intention to remain relevant in that part of the world and to reinforce the international rules-based order, human rights, democracy, the laws of the sea and so on.
Pillar 1 of AUKUS, which is a trilateral arrangement and will continue as such, will deliver a nuclear-powered, conventionally armed submarine capability to Australia. The phased approach of this will culminate in SSN-AUKUS, built and operated by both the UK and Australia. It is based on the UK’s next-generation design and incorporates advanced US technologies. It will bolster our national security as well as theirs, help us reduce costs and equip us with one of the most advanced submarine capabilities in the world, which I think is of immense importance.
The AUKUS naval propulsion agreement provides an essential legal footing for that co-operation. It is a key facilitator upon which we will negotiate a bilateral treaty with Australia that will govern how we collaborate to deliver Australia’s SSN-AUKUS programme. In answer to the noble Lord, Lord Udny-Lister, and others, this should create major trade opportunities for the UK, with billions of pounds of submarine components expected to be exported from our supply chains, which will benefit us as well as Australia and others. I take the point about the need to develop a skills programme that will allow us to take full advantage of those proposals. The noble Lord, Lord Stevens, alluded to this.
Pillar 1 is about Australia, the UK and the United States. Pillar 2 is incredibly important but perhaps less well understood and discussed than some of the other aspects. It deals with artificial intelligence, hypersonics, cyber and all these other technological, modern types of warfare that will take us into the 21st century and are hugely important. There are really important conversations going on, particularly with New Zealand, Canada, Japan and South Korea, about co-operation on pillar 2.
On nuclear non-proliferation, I say to the noble Baroness, Lady Bennett, in particular, that the AUKUS naval nuclear propulsion agreement is fully compatible with our national obligations under the nuclear non-proliferation treaty. Australia has reaffirmed unequivocally that it does not have and will not seek to acquire nuclear weapons. The agreement does not permit the supply of nuclear weapons to Australia by the US or the UK. On the contrary, it restates legally binding non-proliferation obligations and is fully consistent with the AUKUS partners’ commitment to set the highest possible non-proliferation standards, which the Prime Minister reaffirmed alongside President Biden and Prime Minister Albanese in September.
I thank noble Lords for their thoughtful consideration of these two separate agreements. Our sovereign nuclear deterrent and the AUKUS partnership are two central pillars, as this debate has recognised, of our national security and defence strategies. The Government are committed to strengthening both and building on some of the work of the last Government, to be fair, in establishing AUKUS. The treaties we have discussed today will enable us to do that. The unflinching power of our nuclear deterrent and the unrivalled strength of our military alliances and partnerships are what will keep the British people safe in our more contested and unpredictable geopolitical age. Our investment in our nuclear sector will help create 40,000 new defence and civil nuclear jobs by the end of the decade—highly skilled jobs that will spread opportunity across the UK.
Today, the defence nuclear supply chain already benefits over 3,000 businesses. This is an immense investment in cutting-edge science and technology across the country. Above all, it protects our security, protects what this country and our allies stand for and looks forward to the challenges of the geopolitical age in which we live. I thank the noble and learned Lord for the committee’s reports on these two treaties. I urge the committee not only to support this but to argue the case for it, in this House and with the British public at large. It is a major step forward for our country and our alliances and we should all take credit for that.
Lord Goldsmith (Lab)
My Lords, I thank noble Lords for participating in this debate. As the noble Baroness, Lady Smith of Newnham, said, it has been an extraordinarily wide-ranging debate. I had not expected so much knowledge to come out about Australian politics. I do not know a lot about it, but now I know much more, thanks to the noble Baroness, Lady Bennett of Manor Castle—but obviously noble Lords spoke about the great geopolitical questions that we are concerned with. To the noble Lord, Lord Hannan, I have to say that, with regards to matters of history, I tend to side with the noble Lord, Lord Hannay, but he may persuade me one day.
I want particularly to thank the Minister. He has made two personal commitments today for which I am very grateful. One is how we deal with the renewal question, which I shall come back to. The second is what he said about helping to educate his colleagues about the limitations of the CRaG process, which I hope will help us to pursue the amendments which I and others believe are necessary.
I have talked about this issue in the House before. Once upon a time, of course, Parliament did not have any right to look at treaties, unless a Minister chose to bring them. All treaties were made under the royal prerogative, and there was no process for parliamentary scrutiny as a matter of generality. CRaG has changed that, and that is very good, but it is limited. It is limited in terms of time, as noble Lords have said—and it is extraordinary how difficult it can be. When one says from time to time, “I pay tribute to the work of the committee staff and the officials”, it really is the case here. Our committee staff—and our clerk, Rhiannon Williams, is sitting in the Public Gallery—have to pick up these treaties, often at short notice, and find expert evidence that will help us, because we do not necessarily know all the answers, so finding people who can help the committee is very important.
We then need to get a report done in time to meet the CRaG scrutiny period, which is limited, and we depend on the Government. I do not want to be political about this, but this committee produced an important report on Rwanda, which it was actually quite important for Members in the other place to debate, because they are the ones who have the right under CRaG to say, “Don’t ratify this now”. We did not in a sense have a statutory right. But to do that, they needed to have time for a debate, and that was in the hands of the Government. There are issues about time for debates that are also important. That is why I started by thanking the Government for making time for this debate—and I repeat that thanks now. So we will continue to look at the CRaG process and we will come forward with some proposals for reform. I shall take the Minister up on his promise to talk to his colleagues about that when we have formulated precisely what we think should happen.
The second thing is the commitment that the Minister has made in relation to renewal. This was a matter that exercised the committee. On one hand, taking away the 10-year renewal—or, to use different language, the break clause—adds to our security, because it means that there is an evergreen commitment to do those things that the agreement does, and that is a good thing. But, by a sidewind, it takes away parliamentary scrutiny at the same time, which was what exercised the committee. So our proposal that the Government should none the less come forward to Parliament and tell it every 10 years, taking the same period as was in the previous arrangements, is a good way to ensure that there is still some scrutiny.
We will look at precisely what the Minister’s officials come forward with. He has made an in-principle commitment—I understand entirely why that is so. He will not be surprised to hear me say, using the same words that the noble Baroness, Lady Goldie, used, that we will hold him, as it were, to account—the Government to account—for making sure that there is a scrutiny which works.
I very much welcome the support for reform that we had from a number of people: the noble Lords, Lord Howell, Lord Hannay and Lord Bilimoria, and others as well, and we will follow that through.
I do not think there is anything more I need to say about this debate. It has been a great privilege. Well, there is one thing I want to say. The noble Lord, Lord Udny- Lister, referred to dealing with this committee as being like herding cats. He said it was a formidable committee, and it is, but that is because of its members’ expertise, talent and experience, not because of any feline qualities that they might have. However, it is a great privilege and a pleasure to chair this committee. It is doing important work, and the fact that we have a debate in which it is not just the members of the committee who came to speak—although it included them—is very welcome. With those words, I beg to move the Motion standing in my name.
Co-operation Related to Naval Nuclear Propulsion
(1 month, 4 weeks ago)
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Lord Goldsmith
That the Grand Committee takes note of the Agreement among the United Kingdom, Australia, and the United States of America for Cooperation related to Naval Nuclear Propulsion, laid before the House on 2 September.
Relevant document: 3rd Report from the International Agreements Committee.
House of Lords
Working From Home: Public Sector Productivity
(1 month, 4 weeks ago)
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Lord Londesborough
To ask His Majesty’s Government what assessment they have made of the impact of working from home on productivity in the public sector.
The Financial Secretary to the Treasury (Lord Livermore) (Lab)
My Lords, the Government inherited a situation where public sector productivity remained 6.4% below pre-pandemic levels. This is clearly unacceptable. Our focus is on fundamental reform of our public services, to drive greater efficiency and productivity. Further details on this agenda will be set out in the Budget and spending review.
Assessments of the impact of working from home on productivity seem—so far—to be inconclusive. The Government are very clear on the benefits of collaborative face-to-face working, in the Civil Service in particular. Studies by the IMF, the University of Manchester, the CBI, Google and Amazon have set out clear advantages to a hybrid working model.
Lord Londesborough (CB)
My Lords, my Question was prompted by an interesting claim made by the Minister’s colleague the Business Secretary. He said that
“allowing working from home creates a more productive, loyal workforce”.
I suggest that that is a sweeping statement, lacking in hard evidence. This is clearly an area where one size does not fit all. When will we see some credible, data-driven research, across all areas of the public sector, to measure the real impact of working from home on productivity?
Lord Livermore (Lab)
I agree 100% with the noble Lord that one size does not fit all. So far, studies have been reasonably inconclusive. Some have shown significant drawbacks to working from home, including a lack of social interaction and the associated mental health impacts that that brings, less progression—especially in the early stages of a career—and less creativity and innovation. But there are also some clear advantages to a degree of hybrid working, including more focused working, the ability to work on confidential issues and some interesting labour-supply impacts, particularly for those with disabilities or childcare responsibilities. So I think the jury is out, but more studies are being undertaken all the time.
Lord Maude of Horsham (Con)
My Lords, is it not the case that the biggest contribution to improving productivity, particularly in central government, would be to control and reverse the ballooning size of the Civil Service? It fell by 21% in the time of the coalition Government, but has since increased by 34%. Is not that uncontrolled growth a contributor to poor productivity? Could the first step be to have someone unequivocally in charge of the Civil Service, instead of the fudged arrangements that are apparently about to be continued?
Lord Livermore (Lab)
The noble Lord makes an interesting point. The Government inherited a situation where public service productivity remained 6.4 % below pre-pandemic levels, and the ballooning size of the Civil Service—as he described it—under the previous Government may have contributed to that. I do not know the answer to that, but the Chancellor has been very clear that the Government will establish a programme of public sector reform to drive much greater productivity, improving the quality of public services and the value for money that we receive.
Lord Wallace of Saltaire (LD)
My Lords, the Government have inherited a rather shrunken Whitehall estate from their Conservative predecessors, where hot-desking had become the norm in a number of departments. Are the Government confident that, if all civil servants turned up five days a week, there would be enough desks for them to sit at?
Lord Livermore (Lab)
No, there would not. One of the benefits of working from home is a much more efficient use of office space. It has a beneficial impact on capital in terms of releasing office space for more productive use, and that is currently what is under way.
Lord Sherbourne of Didsbury (Con)
My Lords, how does the Minister measure productivity in the public sector?
Lord Livermore (Lab)
There are a variety of measures, as I understand it. The ONS has a fairly standard measure. However, the noble Lord is absolutely right that it is much harder to measure productivity in the public sector than it is in the private sector. Measures that the Government are undertaking, such as increasing the number of GP appointments or reducing waiting lists, increase public sector output and therefore productivity.
Lord Patel (CB)
My Lords, following on from that answer from the Minister, NHS England says that productivity in the NHS has declined by 11% since before the pandemic. At the same time, nearly 40% of the staff in NHS England and ICBs work from home. One of the comments made is that we require managers with experience and training to allow for better management of the flow of patients, so that clinicians who cannot work from home are better able to deliver their services. What is the answer?
Lord Livermore (Lab)
I am not sure I am going to be able to answer that right now, but, as set out by the noble Lord, Lord Darzi, in his investigation into the state of the NHS, productivity in the NHS has fallen significantly and is far too low. Improving productivity in the NHS is a key priority. What the noble Lord said about management was really interesting. Emerging studies show that, where workforces are well managed, productivity can rise with working from home. This is a point that the noble Lord who asked the original Question raised in a previous debate on this subject, which I read: the quality of management has a key impact on productivity when working from home.
Baroness Neville-Rolfe (Con)
My Lords, although good management certainly makes a difference, there is strong evidence from academic studies that working from home reduces productivity—although there are other benefits. So far, this Government have been coy about publishing office attendance figures for government departments, as we used to do. Will the Minister ensure that the publication of such figures is restarted and that working from home is limited to those areas where efficiency is not compromised?
Lord Livermore (Lab)
This Government have exactly the same policy in terms of civil servants working from home as the last Government: civil servants should be in the office for a minimum of 60% of the time. That is unchanged and those figures will of course be published in exactly the same way. The noble Baroness said that working from home reduced productivity: that is not actually the case, according to many studies. I read one from the IMF recently that said that the positive and negative effects of working from home roughly offset each other, generating no net productivity impact.
Baroness Thornton (Lab)
Would my noble friend like to comment on the fact that, as a result of the pandemic, disabled people have been able to access work and all sorts of other things—like this House—more than they had previously? I hope that the Government will factor into their examination of this the fact that there are absolutely positive benefits of working from home for those with disabilities.
Lord Livermore (Lab)
I 100% agree with my noble friend. Most of the studies that have emerged so far on this subject suggest that there are very positive labour supply impacts of working from home. They particularly apply to those with disabilities who do not have to commute to the workplace and have their home working environment already adapted to their needs. They also apparently apply to those with childcare responsibilities coming back into the labour market.
The Lord Bishop of St Albans
My Lords, a recently published economic report by Pragmatix has identified the extraordinary gap between urban and rural productivity, including on homeworking, exacerbated by the problem of rural connectivity. Is the Minister aware of some of the local solutions that are now being tried? We are involved in some of those, for example with hosting antennae in church spires and towers and bouncing signals into more remote areas to enable homeworking and to increase productivity. Would he be willing to support some of these important initiatives for the sake of rural sustainability?
Lord Livermore (Lab)
It is an interesting question, and the answer is yes, I would be very willing to look at those impacts. As we have been discussing, labour supply has impacts across the economy. In rural areas, where sometimes it is difficult to travel into work, being able to work from home and the ability to have fast-speed internet connections can make a massive difference, and I would be more than happy to look at those issues.
Lord Forsyth of Drumlean (Con)
Is the Minister confident that working from home is increasing productivity and does he think there is any correlation between the rise in the number of people watching daytime television and the rise in the number of people working from home?
Lord Livermore (Lab)
At no point in any of my answers did I say it raises productivity—just so I am very clear. I will read from the IMF’s report, for the noble Lord’s benefit:
“Classic firm and individual micro studies typically find that hybrid working … has a roughly flat impact on productivity. Working from home benefits workers by saving them from exhausting commutes and typically provides a quieter working environment. But by reducing time at the office, it can also reduce employees’ ability to learn, to innovate, and to communicate. These positive and negative effects roughly offset each other, generating no net productivity impact”.
Baroness Ludford (LD)
My Lords, are the Government taking into account the effect on customers, and indeed taxpayers? My experience of ringing HMRC was that I was told that the official was working from home and was unable to access the computer necessary to order a tax statement for me. I thought that was odd. I would have thought the infrastructure needed to be in place.
Lord Livermore (Lab)
I obviously cannot comment on the particular phone call that the noble Baroness had, but I will say that the same IMF study says:
“Some studies … found large positive impacts, typically in more self-directed activities, such as call centre or data entry work”.
Decommissioned Nuclear-Powered Submarines
(1 month, 4 weeks ago)
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Baroness Bryan of Partick
To ask His Majesty’s Government how many decommissioned nuclear-powered submarines there are in Scotland; and how many years it will take to safely dismantle them.
The Minister of State, Ministry of Defence (Lord Coaker) (Lab)
My Lords, there are seven decommissioned and defueled nuclear power submarines in Rosyth Royal Dockyard, Scotland. “Swiftsure”, the first vessel being disposed of, is being used as a demonstrator to refine the dismantling process under the Ministry of Defence’s submarine dismantling project. Learning from “Swiftsure” will provide more certainty about the schedule for dismantling the remaining decommissioned Royal Navy submarines. The full dismantling of “Swiftsure” is due to be complete in 2026, achieving the commitment given to the Public Accounts Committee in 2019.
Baroness Bryan of Partick (Lab)
I thank the Minister for his Answer. My Question happily coincided with information that was released last week, but there remains real concern that not one of these submarines has yet been dismantled. Bearing in mind that one Dreadnought submarine in Rosyth has been out of service since 1980, it will take decades to dismantle the boats remaining in both Scotland and Devonport. Can the Minister say whether there has been any progress in finding a site for the radioactive waste disposal facility which will be essential to progressing this work?
Lord Coaker (Lab)
On all the things that my noble friend mentions there is progress and ongoing discussions, including the waste disposal site, but we are trying to speed up the submarine dismantling programme. Seven submarines at Rosyth are decommissioned. All have been defueled. “Swiftsure” is now in dry dock. That will be fully dismantled by the end of 2026. There are 15 such submarines at Devonport. Four of those have been defueled. However, my noble friend is quite right; we need to speed up the process and we are certainly looking at every way in which we can do that.
Lord Trefgarne (Con)
My Lords, the Minister referred to the time taken to dismantle the retired submarines. How long will it take to get the new ones?
Lord Coaker (Lab)
The noble Lord is right to ask about dismantling. As I said to my noble friend, we are seeking to speed up that process. On the new submarines, if he is referring to the Astute class submarines, seven were ordered, six are already in the water and one is now under construction in Barrow. If he means the successor to the Vanguard class, we expect the first to be in service in the early 2030s. We are making considerable progress, and I hope that answers his question.
Baroness Smith of Newnham (LD)
My Lords, as the noble Baroness’s follow-up question pointed out, there is an accumulation of nuclear submarines that have been decommissioned but are still in Rosyth or Devonport. Are His Majesty’s Government sure that they are safe? Can the Minister commit to ensuring that freedom of information requests are responded to? Apparently, the MoD has not been responding to safety questions.
Lord Coaker (Lab)
On freedom of information requests, if the noble Baroness has any examples that she would like me to look into, she only has to ask and I will certainly do so. Freedom of information requests should be responded to within the timeframe laid down, so I will look at that. As I said, we are looking to accelerate the dismantling programme. I am confident that the processes that we are seeking to put in place will speed that up and that they are safe.
Lord Fox (LD)
My Lords, the noble Baroness, Lady Bryan, mentioned the disposal of nuclear material as and when it is eventually removed from the submarines. Can the Minister confirm, perhaps by letter, whether the establishment of a new disposal site—which has been debated for many years and is still no nearer, as far I can tell—will require primary legislation to be enacted? If not, how would the planning process be developed for the future disposal of that nuclear material?
Lord Coaker (Lab)
I may need to write to the noble Lord. I usually like to be able to respond directly to questions, but I do not want to get the planning process wrong or give the wrong answer on whether primary or secondary legislation is needed. I will respond to him with a letter to make sure that I am accurate and will place a copy in the Library so that it is available to all noble Lords.
Baroness Goldie (Con)
My Lords, on 20 May 2021, the Conservative Government published an update on the submarine dismantling project, stating that 90% of the decommissioned submarine materials could be recycled. Is the Minister in a position to confirm that his Government are committed to retaining that target? On the experience of decommissioning HMS “Swiftsure”, which is very well advanced, can he also indicate whether there is any proposal to secure an engineering impact assessment to understand how the process for future submarines might be expedited?
Lord Coaker (Lab)
I pay tribute to the work that the noble Baroness did to try to speed up some of these processes. She asked two very pertinent questions. For “Swiftsure”, we retained the 90% recycling target. She will know that once a decommissioned submarine such as “Swiftsure” is defueled, there is an initial phase that takes the nuclear material out. Then there is an intermediate phase, which is followed by dry-docking—which is where “Swiftsure” is—for the rest of the submarine to be recycled. We expect 90% of that to be recycled. The whole point of “Swiftsure” is that it acts as a demonstrator project so that we can learn from how that was done—what worked and what perhaps could have been improved—and then apply that to all the other submarines that have been decommissioned.
Lord Wigley (PC)
Does the Minister recall the late, great Sir John Houghton, who identified the dangers of global warming several decades ago? As an eminent scientist, he identified the potential to generate electricity by reworking some of the nuclear waste that comes from not only submarines but other parts of the Armed Forces. Are the Government investigating that aspect?
Lord Coaker (Lab)
No, we are not investigating that for nuclear submarines. The MoD takes climate change very seriously, and I have recently signed off a submission about fuel and its better economic use with respect to climate change. Right across the MoD, climate change is taken seriously, but on the noble Lord’s specific question about decommissioning nuclear submarines, there is no intention to use them, for example, to go into the grid.
Earl Attlee (Con)
My Lords, are the older submarines more difficult to recycle than the Swiftsure class?
Lord Coaker (Lab)
We will understand that more fully once we have finished the demonstrator project with HMS “Swiftsure”.
Lord Teverson (LD)
My Lords, the Minister says—it is not his fault—that the new nuclear submarines will not be delivered for another six years, yet the current length of patrols for the Astute class is getting longer. The crews have to cope with long periods of being away from their families and their homes. There is also stress around the recruitment of those crews. How do we square the circle over the next five or six years when, because of the maintenance of the current fleet, the length of patrols is likely to get even longer?
Lord Coaker (Lab)
Let me just say to the noble Lord that everything that happens is now my responsibility. If I gave the impression that it was not my responsibility, that certainly was not my intention. I will not evade responsibility for anything.
On the noble Lord’s question, I am not going to go into the operations of our submarine fleet in great detail on the Floor of this House, for obvious reasons. However, the noble Lord makes a point, as he has done here previously, about the welfare of submariners—indeed, the welfare of all our Armed Forces. That is something we take very seriously. We are looking to do all we can to support them and ensure that they are supported in the way they should be. In a few months’ time, or a year’s time, perhaps the noble Lord can ask the same question, and we will see whether we have made the progress we should have done; that will be my responsibility.
Lord Foulkes of Cumnock (Lab Co-op)
My Lords, with no disrespect to the important Question asked by my noble friend Lady Bryan, should we not be even more worried about Russian nuclear-powered and nuclear-armed submarines in the Atlantic and elsewhere? Can the Minister give us a complete assurance that we have all the capability to keep an eye on them to make sure that our danger is minimised?
Lord Coaker (Lab)
I thank the noble Lord for his question. He refers to our continuous at-sea deterrent. Under every Government, that continuous at-sea deterrent has been maintained. It is a crucial part of our defence of our democracy, of our freedom and against Russian aggression. That policy has been the same whatever the colour of the Government. The previous Government dealt with that and wanted to modernise the deterrent. We will carry on with that. It is an important part of our deterrent posture. Our adversaries should know that, 24 hours a day, seven days a week and 365 days a year, our at-sea deterrent will continue for as long as is necessary.
Lord Kamall (Con)
The Minister said that the MoD is not considering how it could use the material from decommissioned nuclear submarines for generation. Can he say whether that is for technical reasons—that is, limitations of technology—or for other reasons?
Lord Coaker (Lab)
I suspect that it is for safety reasons and that it is not the best way of using that material. I am not a nuclear physicist nor an expert on nuclear material, but I suspect that it will be something to do with it being too expensive, not safe or simply not appropriate to do it in that way. Obviously, all that will have been considered and decisions made as a consequence.
HS2: Purchased Land
(1 month, 4 weeks ago)
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Lord Grocott
To ask His Majesty’s Government what plans they have in respect of land already purchased for HS2 north of Birmingham.
The Minister of State, Department for Transport (Lord Hendy of Richmond Hill) (Lab)
My Lords, the Government are thoroughly reviewing the position they have inherited before setting out more detailed plans in due course. This includes our position on HS2 phase 2 safeguarding and on the land that was previously acquired for HS2’s cancelled phases. Any land acquired for phase 2 that is no longer required will be sold in line with Treasury rules through a disposal programme.
Lord Grocott (Lab)
My Lords, as my noble friend the Minister knows, when Rishi Sunak cancelled the northern leg of HS2, he did so in the full knowledge that substantial sums of money had already been spent. Can my noble friend tell me his estimate of precisely how much had been spent before the cancellation? Further, so that money is not entirely wasted, can he give the House a clear assurance, which I am not sure he gave in his Answer, that the Government will at least protect the route of the line to Manchester, including retaining land that has already been purchased? I am sure he would agree that, in so doing, he will make it much easier for any future Government—this one, I hope—to complete the project, which should never have been cancelled in the first place.
Lord Hendy of Richmond Hill (Lab)
I thank my noble friend for his supplementary question. As reported by the National Audit Office, by March 2024 £2.3 billion had been spent on phase 2 which, as he says, was cancelled by the previous Government. No property on the hastily cancelled phase 2a has yet been disposed of. The Government are carefully considering what to do. He will know as I do that railway infrastructure lasts 150 or more years, so the right thing is to have a considered long-term plan for the benefit of the economic growth, jobs and housing in this country.
Lord McLoughlin (Con)
My Lords, nobody knows better than the Minister the importance of capacity as far as that rail line is concerned—particularly the capacity from Handsacre to Crewe, the legislation for which has already gone through this House. Is there a time limit on that legislation, as there sometimes is on planning permissions, or does that legislation stand good for a Government who wish to concern themselves seriously with a capacity that is so vital on our railways, if we are to shift freight from road to rail?
Lord Hendy of Richmond Hill (Lab)
I thank the noble Lord for his question, and I recognise, as he does, the capacity limitations of the west coast main line north of Handsacre. There is a time limit; I cannot offhand say what it is, but I can certainly write to the noble Lord. The Government intend to work out what to do and to say what they will do before any expiry of those powers.
Lord Cromwell (CB)
Can the Minister tell the House whether land acquired in this way, where it is to be disposed of, will be offered back to its original owners? Can he comment on interviews that I have heard, where people have been offered the opportunity to buy back the land but at prices considerably higher than they were given when the land was compulsorily acquired from them?
Lord Hendy of Richmond Hill (Lab)
My Lords, I know there is a process to be followed. I will have to write to the noble Lord to explain that process in detail and on the allegation that people have been asked to pay more for their land when it has been offered back than they were offered in the first place. I will do so.
Lord Moylan (Con)
My Lords, the Minister will know that since the cancellation of HS2, the mayors of Greater Manchester and the West Midlands have collaborated in commissioning and producing a report for the construction on a similar alignment of what is referred to as the “Midlands-North West Rail Link” at considerably lower cost than HS2 would be. Can the Minister give the House an absolute assurance that no land will be sold that would be necessary for the construction of that proposed rail link until the Government have had the time to assess it and give it full consideration?
Lord Hendy of Richmond Hill (Lab)
I am aware of the report that the noble Lord refers to. It is an interesting report. We recognise the concerns about connectivity between Birmingham, Manchester and the north of England. We will consider advice and engage with the mayors and the detail of the report and give ourselves time to do that before any precipitate action is taken on the land concerned.
Baroness Randerson (LD)
My Lords, does the Minister agree that building a modern railway should surely include level boarding, in order to make disability access available to everyone? Does he therefore share my concern that many of the stations planned on HS2 were not to have level boarding? In particular, can he reassure us that the Government’s review will look at level boarding access at Old Oak Common station, which will be a major point on the route?
Lord Hendy of Richmond Hill (Lab)
I thank the noble Baroness for her question. I am as aware as she is that level boarding is a really important consideration for many people, including those with disabilities. However, even in respect of HS2, it is a complicated subject because there are relatively few HS2 stations and, as it is now configured, those trains will serve many stations on the conventional railway network, at which platforms have been at differing heights for as long as they have been built, in some cases going back to the 1840s. However, the point she raises is really important; the point she raises about Old Oak Common is important, and the point about Old Oak Common is equally complicated, because Old Oak Common will not merely serve the new HS2 trains in their new station—at which level boarding will be relatively simple—but will also serve trains on the conventional railway network on both main and relief lines out of Paddington, which have themselves several different floor heights. We need to crack this problem, and I am very sympathetic to the point raised by the noble Baroness, but it is more complicated than it might sound. I will give her the assurance that she wants that we are actively considering it, because building new railway stations is very expensive and takes a long time and we should try to get it right.
Lord Framlingham (Con)
My Lords, on 31 January 2017 I put an amendment down in this House to the HS2 Bill which, if passed, would have stopped it there and then and saved us all an awful lot of trouble. Some 25 of your Lordships understood and supported me; unfortunately, the Bill that went through resulted in the chaos that we have known, confirming that the project was never a good idea. It is hugely expensive at the expense of the NHS among other things—
Lord Framlingham (Con)
This issue warrants quite a little bit of talking; it is the biggest one and everybody in the country thinks it is nonsense. Here is my question for the Minister: can he please do his best with an impossible task, keep us fully updated and make sure that everybody who has been affected by this travesty gets the fairest possible treatment?
Baroness Smith of Llanfaes (PC)
My Lords, will the Minister confirm that the Government will correct a long-standing injustice that this has starved the Welsh public purse for far too long? Does he acknowledge that HS2 is an England-only project, and will His Majesty’s Government ensure that Wales receives the £4 billion of consequentials owed to the Welsh Government, as Welsh Government Ministers and the Secretary of State for Wales support?
Lord Hendy of Richmond Hill (Lab)
I doubt the noble Baroness’s allegation about support. It is a serious issue, but it is about the allocation of funding. I have answered these questions before, and the position remains the same.
Ukraine: North Korean Troops
(1 month, 4 weeks ago)
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Lord Robathan
To ask His Majesty’s Government whether they regard the deployment of North Korean troops to Ukraine as an escalation of the conflict by Russia.
The Parliamentary Under-Secretary of State, Foreign, Commonwealth and Development Office (Baroness Chapman of Darlington) (Lab)
My Lords, it is highly likely that the Democratic People’s Republic of Korea has begun to send troops to Russia. This is a deeply concerning development that risks prolonging the war and augments DPRK’s already significant support to Russia, including munitions and arms that are being used by Russia in its illegal war against Ukraine. This further illustrates Russia’s growing reliance on third-country support and the deepening military co-operation between Russia and DPRK, which has security implications for Europe, the Indo-Pacific and the wider world.
Lord Robathan (Con)
My Lords, I doubt anybody in NATO would wish to see a shooting war with Russia, far less, God forbid, a nuclear conflict. The aggressor, Putin, threatens the West throughout with dire consequences unknown if there is any escalation of the war, yet he is now apparently bringing in thousands of North Korean troops to assist him, from an ally in the axis of evil. Putin is already waging war against the West. In the UK, Litvinenko was murdered 18 years ago, we had the Salisbury poisonings and only last month we had the warning from Ken McCallum of MI5 about Putin’s intention to disrupt British life. Will the Minister please go back to her colleagues in the department so that we can further assist Ukraine in defeating the aggressor? In particular, will she lobby for allowing Storm Shadow missiles and other weaponry to be used for attacks on Russia, because the best way to maintain peace in Europe is to defeat the aggressor, Putin?
Lord Kennedy of Southwark (Lab Co-op)
Before my noble friend responds, this is called Question Time for a reason. We want short, sharp questions.
Baroness Chapman of Darlington (Lab)
I am grateful to my noble friend the Chief Whip. With absolute respect for the long experience of the noble Lord, Lord Robathan, and the conviction and passion that he brings to his question, there were several points in there. We have discussed Storm Shadow at length in this Chamber. The only person who benefits from us discussing it in this way is Vladimir Putin. I will not say any more than what I have already said on Storm Shadow, but I absolutely agree with the noble Lord that this is further evidence of Russia’s hypocrisy, as he alluded to, its recklessness and its absolute disregard for international peace and security.
Lord Stirrup (CB)
My Lords, we read and hear a lot about the military pressure Russia is exerting on Ukraine, but are not the increasing numbers of North Koreans involved in the conflict, along with the widening of the pool of prisoners from which Russia seeks to recruit soldiers, evidence that the pressure is far from one-sided? Does this not underscore the importance of sustained resolve on the part of the West?
Baroness Chapman of Darlington (Lab)
The noble and gallant Lord is correct, and that is what we will have. We have gone over this ground very many times, but it is always worth repeating that the defence of Ukraine is the defence of Europe. The consequence of the West doing anything other than showing the resolve that the noble and gallant Lord recommends would be to send a deeply worrying message that we fail to stand up to aggressors such as Putin. That must never, ever be something we can tolerate. We stand united in this House, in the country and with our allies.
Lord Purvis of Tweed (LD)
My Lords, part of the pernicious relationship between North Korea and Russia is the supply of military equipment, but the disturbing BRICS summit, which many of our trading allies are currently attending with Putin, means that there are too many countries supplying component parts that can be channelled through North Korea and end up being used on the battlefields of Ukraine against our ally. Will the Minister ask the Office of Trade Sanctions Implementation—a new development that we welcome —to be proactive in ensuring that component parts for military equipment from our trading allies do not end up in Ukraine, and to look at widening our trade sanctions?
Baroness Chapman of Darlington (Lab)
Our sanctions regime and the legislation that surrounds it apply to any UK entity, be that in the UK or worldwide, as the noble Lord knows. We will speak to anyone we need to, using any appropriate channels, to try to dissuade others from supplying Russia through whatever means. All anybody supplying Russia with munitions, troops or anything else serves to do, whether they are an ally of ours or not, is prolong this illegal war and the suffering of the people of Ukraine.
Lord Callanan (Con)
My Lords, we on this side stand united with the noble Baroness and the Government in our support for Ukraine. Yesterday, it was reported in the Daily Telegraph that South Korea could send lethal weapons to Ukraine after North Korean troops land in Russia. Could she therefore confirm whether the Foreign Secretary was privy to any conversations during his recent visit to South Korea about whether it will provide support to Ukraine?
Baroness Chapman of Darlington (Lab)
My right honourable friend the Foreign Secretary recently spoke with his counterparts in South Korea and, indeed, in China. Noble Lords can rest assured that he raised at the highest level all the issues we would want him to raise regarding Russia, Ukraine and China.
Lord Hannay of Chiswick (CB)
My Lords, will the Minister confirm that if North Korean troops were deployed in Ukraine or North Korean materiel were passed to Russia, that would be a breach of UN Security Council resolutions for which Russia voted in favour?
Baroness Chapman of Darlington (Lab)
It would clearly be a breach. It is deeply concerning, and the most recent reports seem to indicate that it is highly likely, hence the deep concern we are expressing at the moment.
Lord Houghton of Richmond (CB)
The effective control of escalation in this conflict appears to be vital. Can the Minister in any way reassure the House that we are a fundamental part of some international mechanism that assesses escalation risk?
Baroness Chapman of Darlington (Lab)
Everything we have done has been with a view to avoiding escalation, because that is the last thing we want to see. However, the reports we have had in recent days are a significant step, and we are deeply concerned. So, our approach will be to discuss the implications of this closely with our partners, as noble Lords would expect.
Lord Alton of Liverpool (CB)
Will the Minister please reflect on two points made this week at the All-Party Parliamentary Group on North Korea, which I co-chair? The first was that the young soldier who walked across a minefield in August is representative of many North Koreans who would like to escape from that tyranny. Can we reach over the heads of their armed forces commanders and make sure that they receive messages in Korean, so they know that they are entitled to take up Korean citizenship in the Republic of Korea should they defect? The second point concerns the United Nations commission of inquiry report 10 years ago. It found crimes against humanity by the North Korean regime and called for a referral to the International Criminal Court. That has never been done. When is the United Kingdom going to raise this?
Baroness Chapman of Darlington (Lab)
I will give consideration to the last point the noble Lord raised, which is very important. On his point about the young Korean soldier, we have known for a long time that the people of North Korea are not masters of their own destiny and do not make their choices freely and willingly. It is desperately sad that we now seem likely to see further decisions made on their behalf, but not in their interests.
Lord Bellingham (Con)
Does the Minister agree that this very serious recent development reinforces the importance of the UK’s programme for training Ukraine’s troops? Will she give the House an update on that programme?
Baroness Chapman of Darlington (Lab)
The noble Lord is right: this is an important contribution that we make and will continue to make. It sits alongside measures announced yesterday—the £2.6 billion additional funding for Ukraine, to be supported by interest on seized Russian assets, alongside the £3 billion per year that the UK has committed to for as long as Ukraine needs it.
Lord Hamilton of Epsom (Con)
My Lords, the Minister said in her initial Answer that she thought that the deployment of North Korean troops would prolong the war. When does she think this war is going to end, with or without the North Koreans?
Baroness Chapman of Darlington (Lab)
My Lords, I only wish I had the answer to that. All I can say is that the way this war ends and the circumstances in which it concludes must be and can only be the decision of the people of Ukraine.
Data (Use and Access) Bill [HL]
Wednesday 23rd October 2024
(1 month, 4 weeks ago)
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Armed Forces Act 2006 (Continuation) Order 2024
(1 month, 4 weeks ago)
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Lord Coaker
That the draft Order laid before the House on 20 May be approved.
Considered in Grand Committee on 22 October
Nationality, Immigration and Asylum Act 2002 (Juxtaposed Controls) (Amendment) Order 2024
(1 month, 4 weeks ago)
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Lord Hanson of Flint
That the draft Orders laid before the House on 29 July and 2 September be approved.
Relevant document: 3rd Report from the Secondary Legislation Scrutiny Committee. Considered in Grand Committee on 22 October.
Government of Wales Act 2006 (Devolved Welsh Authorities) (Amendment) Order 2024
Baroness Anderson of Stoke-on-Trent
That the draft Order laid before the House on 21 May be approved.
Considered in Grand Committee on 22 October
Human Medicines (Amendments Relating to Naloxone and Transfers of Functions) Regulations 2024
(1 month, 4 weeks ago)
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Baroness Merron
That the draft Regulations laid before the House on 29 July and 15 May be approved.
Relevant documents: 1st Report from the Secondary Legislation Scrutiny Committee (special attention drawn to the first instrument by the Secondary Legislation Scrutiny Committee, 2nd Report). Considered in Grand Committee on 22 October.
Sentencing Review and Prison Capacity
(1 month, 4 weeks ago)
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The Minister of State, Ministry of Justice (Lord Timpson) (Lab)
My Lords, with the leave of the House, I will repeat a Statement made in the House of Commons by the Lord Chancellor yesterday. The Statement is as follows:
“With permission, Madam Deputy Speaker, I would like to make a Statement on how the Government will address the crisis in our prisons, not just today but for years to come.
The House has heard me recount my inheritance as Lord Chancellor before. The crisis in our prisons was, I believe, the greatest disgrace of the last Conservative Government. They left our prisons on the point of collapse—a situation that would have forced us to close the prison doors, cancel all trials and force the police to halt arrests. Crime would have gone unpunished, victims would never have seen justice done and we would have witnessed the total breakdown of law and order. The previous Prime Minister knew he had to act. His Lord Chancellor begged him to do so, but instead he called an election.
As I announced to the House on 18 July, we had no choice but to bring forward the release point for some prisoners. Some of those serving standard determinate sentences have seen the custodial element reduced from 50% to 40%, spending the rest of their sentence on licence. They can be recalled to prison should probation staff judge that necessary to protect the public. As we saw over the summer of disorder, these releases could not come soon enough. After the August bank holiday, we were left with fewer than 100 spaces in our men’s prisons. The system was held together only by the heroic work and considerable good will of our prison and probation staff. We were, on many occasions, just one bad day from disaster.
Today, the second tranche of emergency releases takes place, creating desperately needed space in our prisons, but that is not the long-term solution. I will now set out the long-term plan for our prisons, which will ensure that never again is a Lord Chancellor placed in the invidious position that I was on taking office.
This must begin by building more prisons. For all their rhetoric, the last Conservative Government’s record on prison building was abject. They like to mention that, between 2010 and 2024, they built 13,000 places. What they are less keen to admit is that, in the same time, they closed 12,500. In 14 years, they added just 500 places to our prison capacity. In our first 100 days, this Government are already close to matching that. The previous Government promised to build 20,000 new places by the mid-2020s, but by the time they left office they had built only 6,000. They were simply too terrified of their own Back-Benchers, who supported prison building vociferously, as long as those prisons were not built anywhere near them.
This Government will build the prisons that the last Conservative Government promised but failed to deliver. In seeking a lasting solution to our prisons crisis, we must be honest in a way that my predecessors were not. We cannot build our way out of this problem. Every year, our prison population grows by around 4,500 prisoners. This is a question of simple mathematics. To build enough prisons to meet that demand we would have to build the equivalent of HMP Birmingham—which is in my constituency of Birmingham Ladywood—four and a half times over, every single year. To put that in context, in the past 10 years, the last Conservative Government built just three prisons. While we will speed up prison building and build as fast as we can, that pace is simply impossible. For that reason, if we are to address our prisons crisis, we must be smarter about who receives a prison sentence.
Let me be clear: there will always be a place for prison, and there will always be offenders who must be locked up, but we must expand the range of punishments we use outside prison and consider how we punish those offenders who have broken our rules but are not a danger to society. For that reason, today I am launching a review of sentencing. It will have one clear goal: to ensure that we are never again in a position where we have more prisoners than we have space in our prisons.
The review will follow three principles. First, sentences must punish offenders and protect the public. For dangerous offenders, prison will always remain the answer. Punishment and public protection will be the Government’s first priority. There are some offenders whom I will task the review with considering, such as prolific offenders, who account for just one in every 10 individuals, but nearly half of all sentences. Some of them are hyper-prolific offenders, committing hundreds of crimes. I will ask the reviewers to consider whether a longer sentence might punish them better and force them to engage with rehabilitation on the inside.
The second, related, principle of the review is that sentences must encourage offenders to turn their backs on crime—we need both sticks and carrots. I will be encouraging the reviewers to learn from others who have succeeded. In Texas, for instance, Republican legislators faced a problem similar to ours: a soaring prison population; sky-high reoffending rates; and prisons that had run out of space. Working across political divides, the Texans introduced a system of good behaviour credits, where well-behaved prisoners could earn time off their sentence by engaging in rehabilitation programmes. The results were remarkable. Crime fell by nearly a third, reaching the lowest levels in half a century. The prison population fell by over 20,000, and after two decades, the Texans had closed 16 prisons rather than building new ones.
The third principle of the review is that it must expand the punishment that offenders receive outside prison. There are already ways that we severely constrain offenders, limiting their freedom outside prison. Those under home detention curfews are, in practice, under a form of house arrest. With a tag on their ankle and a sensor in their home, they are placed under curfew, generally for 12 hours each day. Should they break that curfew, they can be picked up and, if needs be, locked up.
In some ways, punishment outside prison can be even more restrictive than prison. It is a sad fact that in many of our prisons today, a drinker can all too easily procure a drink. On a sobriety tag, however, with their sweat measured every 30 minutes and a 97% compliance rate, their teetotalism is almost as strict as mine. All of that is just using the technology that is immediately available to us, and used already in this country. I will be inviting the reviewers to consider the technology they have available to them now, and the next frontier of technology, used in other countries but not yet in ours. I believe that the modern world presents us with the opportunity to build a prison outside prison, where the eyes of the state follow a prisoner more closely than any prison officer can.
Moving punishment out of prison for those who can be safely managed there has huge benefits. Outside prison, offenders can engage in work that pays back the communities and individuals they have harmed. The evidence is abundantly clear that those who serve their sentences outside prison are far less likely to reoffend. That cuts crime, with fewer victims and safer streets, and reduces the huge cost to society of reoffending, most recently valued at over £22 billion a year.
This Government believe that crime must have consequences and criminals must be punished. We also believe in rehabilitation—that those who earn the right must be encouraged to turn their backs on crime. This Government believe in prison, but we must increase the use of punishment outside prison too. The sentencing review will be tasked with pursuing those goals.
I am pleased to say that the review will be led by a former Lord Chancellor, David Gauke, a highly regarded Minister who served in multiple roles across government. He has rightly gained the respect of both the judiciary and the legal sector, as well as many within this House. I will work with him to assemble a panel of reviewers who will draw together deep expertise and experience in the criminal justice system. The review will take a bipartisan and evidence-based look at an issue that has for far too long been a political football, booted around by both sides. David Gauke will report back with his recommendations in the spring, and I have placed a copy of the complete terms of reference of the review in the Library of the House.
It is right that the review is given time to do its work. As I have noted already, however, the capacity crisis in our prisons has not gone away. When we introduced emergency measures, we believed that they had bought us about a year. But, after the summer of disorder, the next crisis could be just nine months away. For that reason, I announced last week an extension of the sentencing powers of magistrates’ courts, which allows us to bear down on the remand population in our prisons. But we must go further.
While I will not countenance any further emergency releases of prisoners, there are operational measures that I will lay before the House in the months ahead. The first, which I have already referenced, is home detention curfew. This modern form of house arrest curtails freedom and helps offenders turn their lives around. Offenders are subject to electronically monitored curfews, which must be imposed for nine hours a day, are generally 12 hours long and can extend to 16 hours.
As the shadow Lord Chancellor noted in the House in February, the reoffending rate for the average prisoner, which was measured a few years ago, is close to 50%, but for offenders released on a home detention curfew it is 23%. This Government will soon extend the use of that measure, following in the footsteps of the previous Administration, who rightly expanded its use on a number of occasions. We will increase the maximum period that eligible offenders can spend under house arrest from six months to 12 months.
The second measure that we will introduce will address the soaring recall population, which has doubled from 6,000 to 12,000 in just six years. Risk-assessed recall review is a power of the Secretary of State to re-release, on licence, those who pose a low risk to the public, avoiding the long waits they often face for a Parole Board hearing. In the past, the measure was used often: it was used between 1,000 and 1,500 times each year between 2017 and 2019, but its use has fallen in recent years, reaching as low as 92 times in 2022.
Later this month, I intend to review the risk-assessed recall review process, so that lower-risk cases can be considered for re-release after they have been recalled to prison for two to three months, and where their further detention is no longer necessary to protect the public. I should note that this will change only the cases that can be considered for release, with the final decision still in the hands of experienced probation officers and managers.
The final area where I intend to make progress is in the case of foreign national offenders. I share the public’s view that, with 10,000 in our prisons, there are far too many foreign offenders in this country, costing £50,000 each a year to house at His Majesty’s pleasure. It happens to be my personal view that deportation is as good a punishment as imprisonment, if not better. We are currently on track to remove more foreign national offenders this year than at any time in recent years. But I will now be working with my colleagues across government to explore the ways that we can accelerate that further, including working with the Home Office to make the early removal scheme for foreign offenders more effective.
When I walked into the Ministry of Justice for the first time as Lord Chancellor just over three months ago, I encountered a prison system on the brink of collapse. It was the result of the inaction of the last Government, who thought they could dither and delay, and led us to the precipice of disaster. But their failure was longer in the making: they failed to build the prison places this country needs and they failed to address the challenge of an ever-rising prison population.
In July, this Government took action to avert immediate disaster, but the plan that I have set out today does more than that. It will ensure that this Government and our successors are never forced to rely on the emergency release of prisoners again—a measure over which I had no choice, one that I took despite my personal beliefs and one that must never happen again. I commend this Statement to the House”.
Lord Keen of Elie (Con)
I thank the Minister for repeating the Statement of the Justice Secretary. It is comforting to note that the Whitehall tradition of dusting down old policies for new Ministers is still with us. Of course, there are many matters addressed in the Statement with which I entirely agree. The proposal for a review is certainly to be welcomed, and there are many policy initiatives touched upon that deserve further consideration and ultimately, I hope, some form of introduction, but does the Minister agree with me that one major issue to be addressed at the outset is the practicality and cost of the measures being proposed?
Take a simple example: extending home detention and the use of tagging. The Minister mentioned tags and sensors, but that is a tiny part of that overall programme. When we have, let us say, thousands of offenders tagged, we require more than just the tag and sensor, however sophisticated it may be. Does the Minister agree with me that, for the programme to work, we require real-time monitoring, real-time reporting 24 hours a day and a real-time response—again, 24 hours a day? There is no point in noticing that someone has left home under curfew if we do not check on them for another week. That makes considerable demands on police resources, for example. What will be done to address that issue in the context of these reforms?
If, however, we are going to use some other service, such as the Probation Service, does the Minister anticipate a significant and, indeed, material increase in the provision of that service? I also ask him: is it proposed to use home detention and tagging as a potential alternative to remand, since it is at the end of remand that we find the greatest pressure upon the current prison system? Furthermore, if we are to have a much-extended home detention system, what steps will be taken to monitor and deal with the impact on families of having an offender in their midst for up to 16 hours a day? We know from the experience of the pandemic lockdown of the stress and mental difficulty that can be caused by that sort of situation. We will need more than just experts in the criminal justice system to address that sort of proposal, so I hope that the appointment of the review panel will go further than indicated in the Justice Secretary’s Statement.
We should also consider the victims of crime and the public perception of crime and punishment. If your home has been burgled half a dozen times in the previous year by the same individual, it is somewhat galling to see him walking down the street in front of your house wearing a tag. We have to be able to inform the public as to the effectiveness of the proposals that are being made. We are going to have to educate the public with regard to their effectiveness. There is the further issue of public confidence in the penal system. At present, it is conceivable that a person given a three-year sentence can be released on licence after three months. How does the Minister consider that the public perceive that when it occurs? A further area of education may be required, if I might be permitted to mention it: the education of the magistrates and judges to persuade them that community sentences can have a much more major part to play in our sentencing policy. Will that too be addressed in the context of the present review?
Then there is a question of how the Government will deal with the opposition. I am referring not to His Majesty’s loyal Opposition but to the Treasury—the place where all penal reform proposals go to die. Before we start out on this ambitious project, will the Minister be able to assure us that he has, in principle, the support of the Treasury for the considerable sums that will be required to implement these policy proposals?
There is an acknowledgement in the Statement that we need more prisons. Will the Minister disclose to us the programme for those new prisons? Will he also address the difficult issue of planning, where proposals for prisons seem to be notoriously subject to blocking and delay? Are there steps that the Minister will be able to advise us of to try to circumvent that problem?
We then come to the matter of foreign nationals, who make up about 12% of the present prison population. The Justice Secretary said in the Statement that it was
“my personal view that deportation is as good a punishment as imprisonment, if not better ”.—[Official Report, Commons, 22/10/24; col. 200.]
Does the Minister agree with me that this is a completely mad proposition? Foreign criminals, gangsters and drug dealers from safe countries—remember that we can deport foreign nationals only to safe countries—will come here to rob, burgle and create mayhem. Then when caught, according to the Justice Secretary’s policy, they will simply be sent home again, no doubt at our expense. We will become a magnet for foreign criminals. Why would you not come here if that was the policy being implemented? Get caught and go home but get a free ticket to go home—wonderful. Can the Minister advise me who dreamed up this particular policy and how they intend to implement it?
It is clear that penal reform has been overdue in this country for many years. I welcome the idea of the review and the appointment of the former Conservative Justice Secretary to head that review. I hope we can see such a review being carried forward in the very near future. I thank the Minister again for repeating the Statement.
Lord Dholakia (LD)
My Lords, I thank the Minister for repeating the Statement in your Lordships’ House. Overcrowding in our prisons has been in the headlines for as long as I can remember. Different Ministers have offered various solutions to this problem. No one seems to have looked at overall solutions that could resolve the problem. We are now offered a review by a former Minister and a prison capacity package to solve the present crisis.
We have long called for a review of criminal sentencing. We have asked for reoffending to be cut by taking a holistic approach to rehabilitation and community supervision, including a full range of rehabilitative services. We also believe in implementing a presumption against short sentences of 12 months or fewer to facilitate rehabilitation in the community.
The present proposals offer short-term solutions but do not alleviate the problems or provide the long-term solutions we badly need. The previous Administration had a golden opportunity to set up a royal commission on the criminal justice system, but this was kicked into the long grass. Instead, we have a piecemeal approach to legislation in this field. We need to look at the overuse of imprisonment. This has put us on top in Europe as the worst country in the way we sentence offenders. It is astonishing that we imprison nearly twice as many people as Germany.
There are a number of questions for the Minister. I welcome the proposals to reduce the prison population. We should seriously examine the work of the Sentencing Council. Surely a Minister should put a legislative obligation to take note of the prison population before a sentence is passed. How will the review plan to address concerns about disproportionate sentencing of minority groups and marginalised communities? Would the Minister agree that ploughing more resources into expanding the prison system to hold an ever-growing number of prisoners is far from the most sensible way to tackle crime?
Lord Timpson (Lab)
I thank the noble and learned Lord and the noble Lord for their welcome of the review, their excellent questions and suggestions and enthusiasm for what we are trying to do. I will try to answer some of those questions now.
Increasing the use of technology as part of community sentencing is something we should consider very seriously. It is not just about the conventional electronic monitoring and the tag. Other countries have far more advanced technology than we do, including Spain, which is a country I am going to look at shortly to understand what we can learn from them. A lot of it is about the data it collects and the reassurance to victims from that data and how it can support them.
The noble and learned Lord is correct that the more tags we put on people, the more work that creates for others. I have mentioned in the House before that we are recruiting 1,000 probation officers and 4,000 more police officers. But it is not just about recruiting them; it is about training them and settling them into their jobs, which takes time. We need to make sure that we do not rush at it, but one thing I can guarantee is that we are not short of tags.
On the point about remand offenders being tagged in the community, for me this comes back to trust and how much the courts can trust tagging and how effective it is at reducing reoffending. When it comes to offenders being at home for a lot of time during the day, if I had the choice between being in prison or being on a tag at home, I would much prefer to be at home reading my kids bedtime stories and helping them with their homework to being behind a cell door.
I am concerned about highly prolific low-level offenders and what we do with them—the noble and learned Lord raised this. A few weeks ago, I spent two days in Preston Prison, following an officer, Steve, around as he did his job. One thing that was very clear was that a lot of the prisoners he spoke to he had known for the last 32 years that he had worked in that prison. They were coming in and out from when they were young to when they were old men. So, as part of the review, we need to consider whether custody for longer periods is the right thing for them. Public sentiment about crime and what we are doing depends on how good we are at reducing reoffending. When 80% of offending is reoffending, something is clearly going wrong. We need to deal with that, but we need to do so as part of the sentencing review and the other things I intend to do in my role.
On money, we are engaging with the Treasury on the spending commitments needed to progress our delivery plans. But, like noble Lords, we will wait for the Budget, which is not too far away. For me, the priority is protecting the public; that has to come before anything else.
On new prisons being built, one is being finished off in York: HMP Millsike, which will open in the spring. We will publish a 10-year capacity strategy soon. I do not have any further details on the planning proposals yet, but I know we have the willingness to make sure that we can build prisons where we need to.
Finally, I feel that £50,000 a year for every foreign national offender in prison is quite expensive when we could be sending some of them home. But what is important is that we work with our Home Office colleagues to make sure that we process the paperwork as fast as possible.
Lord Cryer (Lab)
My Lords, we now have 20 minutes of Back-Bench questions. To paraphrase what my noble friend said, can we have questions, not statements, so we can get as many noble Lords in as possible?
Lord Reid of Cardowan (Lab)
My Lords, I completely support the general thrust of the Statement and the principles underlying it. Of course we will have problems with the Treasury—every department does on every occasion—but I completely welcome it, in particular the appointment of David Gauke. That is a very good start to the bipartisan approach, which I have no doubt will be shared by the opposition spokesman, in his usual supportive role.
On a specific point, right now the evidence shows that over half of adults on short-term sentences will reoffend—that is a terrible number. Meanwhile, community orders have a much lesser extent of reoffending: I think the figure is 34%. Can the Minister assure me that why and how that might be replicated will be considered in the review?
Lord Timpson (Lab)
I thank my noble friend. Like him, I am pleased that David Gauke has agreed to chair this review panel. I have worked closely with him—he was one of my trustees at the Prison Reform Trust—so I know not just how capable he is but how enthusiastic he is for prison reform. We will shortly announce the rest of the panel and I am sure my noble friend will welcome them as enthusiastically.
I agree with my noble friend about community sentences for adults who would otherwise have short-term sentences. I have been in prisons for 22 years and I have seen too many people go in and come out no different. We need to use the opportunity when they are in prison to overcome their mental health and addiction problems. When they leave, they need somewhere to live and, hopefully, a job. It is much easier to do a lot of that—when the risks are right—when someone is in the community, not in prison.
Lord Jackson of Peterborough (Con)
My Lords, I am old enough to remember the promise, under the last Labour Government, to build Titan prisons with 7,500 places—that never happened. Notwithstanding that, the Government are laudably pursuing a policy of tackling violence against women and girls. With that in mind, what specific policies are in place to protect the interests of victims of prisoners hitherto convicted of domestic abuse and sexual assault, who may be released?
Lord Timpson (Lab)
The noble Lord will be pleased to know that a victims’ representative will be appointed to the panel. That is important because the voices of victims need to be heard and we will be announcing the appointment soon.
It is a very difficult situation for victims, especially with the recent releases. Often, they expected someone to be released but it happened a few days or weeks early. I believe that the victim contact scheme is important and works very well. We need to make sure that victims engage with it, where appropriate, because they do not in all cases. The latest SDS40 releases were far better managed. We had an eight-week lead-in time, which is not perfect but is better than the earlier ECSL scheme, which was pretty chaotic. It is important that this review considers the victims in every sentence and every line of the report.
Lord Harries of Pentregarth (CB)
My Lords, one of the most depressing points in the Minister’s Statement is that the prison population grows by around 4,500 prisoners a year. Do we really have to accept that it will continue to grow? The Statement says it is a matter of simple arithmetic, but have we lost sight of living in a predominantly law-abiding society, with crime cut down to the bare minimum?
Lord Timpson (Lab)
When I first walked into the Ministry of Justice and was told that the prison population goes up by 80 people a week, I thought that was manageable. But when you times that by 52, and then by five, you realise the scale of the problem. There are a number of examples of similar situations where people have done things differently. While we have a big problem on our hands, we need to make sure that it becomes a big opportunity to change things, because something is clearly not working.
I will give noble Lords the example of Texas, where they decided that a number of non-violent and first-time offenders would not go to prison but would serve community sentences instead—a number of other states have done similar things. I mentioned earlier that highly prolific low-level offenders actually went to prison for longer. Texas also introduced good-behaviour credits, an incentive scheme for people to behave in prison. Crime went down by 29% and 16 prisons have closed. So we should take hope from the fact that, if we use the evidence and take our time, we can learn from other examples. However, it will take time for the increase in prison numbers to slow down: these things, unfortunately, do not happen quickly enough.
Baroness Blackstone (Lab)
My Lords, I greatly welcome the Statement and the Government’s decision to tackle penal reform, which is long overdue. It is absolutely right to put far more emphasis on non-custodial sentencing. If I have any reservations, they are about embarking on another prison-building programme. The problem is that supply creates demand. Does my noble friend the Minister agree that the decision to expand the number of prisons should be reviewed in the context of improvements in non-custodial sentences and their effectiveness, and in the context of David Gauke’s review of sentencing? There is also a case for closing some prisons, even if new ones are to be built, because many are appalling buildings with inadequate accommodation and terrible facilities, and they should go. Perhaps the Minister could also address that question.
Lord Timpson (Lab)
When I walked into Preston Prison, there was a big board next to the governor’s office, with the names and dates of all the governors of the prison from when it first opened. The first governor started working there in 1798; I walked up the same steps that the first prisoners walked up in 1798. So, clearly, we have a problem with lots of old, dilapidated prisons, house blocks and other parts of the prison estate; unfortunately, we need to build new prisons.
It will take time for our reforms to reduce reoffending. It is one of my goals, and I managed to get it into my job title: Minister for Reducing Reoffending. The more we can reduce reoffending, the fewer prisons we will need. Maybe in 20 years’ time we will look to close the prisons built in 1798—but, for now, I am afraid, we need all the space we have got.
Lord Clarke of Nottingham (Con)
My Lords, I congratulate the Minister on his role in introducing this package of measures and look forward to its speedy progress. When I was Home Secretary and Lord Chancellor, I am afraid I was quite unable to persuade my ministerial colleagues to allow me to proceed with anything that remotely resembled this. I hope that, with the changed climate, the Minister can persuade the public that this approach to sentencing will have no adverse effects on the overall level of crime in this country, as one can find other countries to demonstrate, and that this is an altogether more effective system if it actually reduces the rate of reoffending, which ought to be one of the prime purposes of putting a person in prison when they have committed a serious crime.
Will the review in general be so bold as to have a look at the sentencing guidelines with the judiciary, which have tended to produce ever-longer sentences in recent years in response to populist pressure? Would he also consider the number of minimum sentences that have been introduced over the last 20 or 30 years? There is a get-out clause for the judges, in the interests of justice, but it tends to produce high minimum sentences in every case. Should not the judiciary be trusted to look at the exact circumstances of the particular crime and offender, and have this inhibition on their discretion removed? Will the review be so bold as to look at the actual sentencing guidelines?
Lord Timpson (Lab)
I thank the noble Lord for the question. When he was having those conversations a number of years ago, I think he was also having some of them with me in meetings outside of his political meetings, as I was talking to him about recruiting offenders. As I mentioned before, there are a number of examples of where crime has come down: Texas, Louisiana and a number of other states in the US. The Dutch model is also something I have followed closely.
The noble Lord is right that reoffending needs to come down. I hope that I can instil the skills I learnt running the family business over the years in the culture, values and organisation of the Prison Service, to help it become better at delivering what we need to do on reform.
On the terms of reference on the sentencing review, I will not go into detail—they are in the Library—but I will give noble Lords a brief summary. Our ask to the panel is that we must punish offenders and always leave a space for dangerous offenders in our jails. We must
“encourage offenders to turn their backs on … crime”—
we want better citizens, not better criminals—and we must expand the range of punishment outside of prisons and focus on technology that curtails freedoms. I am sure that noble Lords will be pleased to know that one of the panel members may well, I suspect, be a Member of this House.
Lord Cryer (Lab)
My Lords, we will hear from the Liberal Democrat Benches, which we have not heard from as yet.
Baroness Hamwee (LD)
My Lords, perhaps the review could be so bold as to look at the legislation which deals with mandatory sentencing and minimum sentences. The support around the House for community sentences is very welcome, but I think the Minister will agree—and perhaps he will confirm this—that community sentences need providers of treatments for mental health, alcoholism and so on, and all the services which support offenders. Will the review extend to the support for those providers and the whole gamut of what makes up a good community sentence?
Lord Timpson (Lab)
I thank the noble Baroness for the question. Yes, I hope the panel will engage with the whole sector, and there are so many experts who have so much experience. As far as the scope of the sentencing review goes, it will be reviewing the framework around longer custodial sentences, including the use of minimum sentences and the range of sentences and maximum penalties available for different offences and how we administer them. The panel will also review the specific needs of young offenders, older offenders, female offenders and prolific offenders. It has a lot of work to do, and we hope it will do it by the spring.
Lord Woodley (Lab)
My Lords, there are 1,800 prisoners serving IPP sentences, as the Minister knows. One has been in prison for 12 years for stealing a plant pot; another has been in for eight years for stealing a mobile phone. At the same time, there is no review. When we look at prison places, I look forward to the Minister’s efforts in reviewing this situation, which cannot go on any longer. Does the Minister agree with me that we do not need large warehouse prisons? As the Prison Officers’ Association says, we need something local—something that can be looked after socially in the local area—and that makes sure that reoffending does not take place.
Lord Timpson (Lab)
I thank my noble friend for the question. As for what kind of prisons we need, I think we need a good mix of prisons of all shapes and sizes and in all locations. On IPP sentence prisoners, I am sure the House knows me well enough to know how deeply troubled I am by the state of the lives of IPP sentence prisoners. It is not included in the sentencing review because I feel we are already making good progress, albeit early progress. The IPP action plan is solid and we need to push on fast with it.
I am looking at two things at the moment. One is that 30% of IPP sentence prisoners are in the wrong prison for helping them fulfil their needs to get out of prison. I am also heartened by a dashboard that we now have so we know where every IPP prisoner is and where they are up to with their sentence—it may not sound much, but it is a game-changer for how we can support people to work through their sentence. So I want to make rapid progress. I also reassure my noble friend that, when I was running the family business, I managed to work alongside 30 colleagues who were IPP prisoners and they were absolutely fantastic, and the second chance that they were given was paid back in buckets.
Lord Farmer (Con)
My Lords, with sentencing of female offenders, much is made of their vulnerability, their adverse childhood experiences and revictimisation as adults. Judges are increasingly mindful of their roles as primary carers. All this is humane and understandable. Is the sentencing review going to take a similar approach to men? While they must also take responsibility for breaking our laws, many are equally vulnerable and have had many adverse childhood experiences—I think 25% of the prison population has had the experience of being in care—but it is culturally normative to take a far more punitive approach to men.
Lord Timpson (Lab)
I thank the noble Lord for the question. While the review will evaluate the sentencing framework and examine the experiences of all offenders, it will be guided by the evidence of what works to keep the public safe and to rehabilitate offenders. I am focused on the evidence of what works both here and abroad. Currently, judges and sentences already take into account the individual circumstances of each case to account for the culpability of the offender, male or female, and the harm they caused, or intended to cause and any aggravating or mitigating factors.
There are three facts that I am sue the noble Lord will know: female offenders make up only 4% of the prison population; over two-thirds of them are in prison for a non-violent offence; and 55% of women in prison have dependent children. What noble Lords may not know is that the average life expectancy for someone who is not in prison in this country is 82; if you are a man in prison, it is 56; if you are a woman in prison, it is 47. So, we clearly have a lot of work to do to support these very vulnerable and often ill people.
Baroness Butler-Sloss (CB)
My Lords, since so many repeat prisoners have drink and drug addictions, are the Government looking at residential establishments outside prison with a probation order, where, if they do not obey at the residential place, they would then go to prison?
Lord Timpson (Lab)
The noble and learned Baroness is correct that drugs and alcohol is a massive problem for people in prison and leaving prison. With 49% of prisoners having drug misuse problems, it is not surprising that in prisons there is a demand for drugs. But when people are out, we need to do all we can to help them overcome their addiction problems because otherwise they are far more likely to be recalled and to offend again. So, I am fan of drug-free wings in prisons and of all the excellent support mechanisms already out there. Residential support centres for women are of far more interest for me in the future, and there are a couple of examples that are already starting to work very well.
Lord Harris of Haringey (Lab)
My Lords, I am very pleased to hear the Minister’s Statement and his emphasis that prison is about not just punishment or public safety but rehabilitation. When I did a lot of prison visiting 10 years ago, one of the biggest problems was that, although courses were laid on internally, prisoners were often unable to attend them simply because there were insufficient staff to conduct them from their cells to the courses concerned. I would be grateful if the Minister could tell us how that will be addressed. More importantly, what incentivisation will there be for prisoners to take part properly in the rehabilitation programmes?
Lord Timpson (Lab)
I thank my noble friend for his question. I have walked past far too many classrooms in prisons where there are rows of computers and desks but no one inside. When prisons are 99.9% full, all that the governor can do is get people clean clothes, three meals a day and a shower. Going to a classroom is the last thing on their list, which is a very sad state of affairs.
I am used to incentives. Some noble Lords may have been into the business I used to work in—one of the Timpson shops—and while they may have asked for one key, someone may have tried to sell them two. The reason they do that is not because they are trying to be helpful; it is because they have an incentive. What I know from incentives elsewhere in the prison world is that they can have a very positive impact on prisoners’ behaviour: to engage with their sentence plan, to go to education and to purposeful activity, not to take drugs and to play the game. We are working on this now and I hope to provide more information to the review in due course. It is very powerful; in the new year, I hope to go to Texas with the Lord Chancellor to see for ourselves exactly how we can implement it and just how powerful it can be. That is very important for us to do.
Passenger Railway Services (Public Ownership) Bill
Wednesday 23rd October 2024
(1 month, 4 weeks ago)
Lords ChamberRead Full debate Passenger Railway Services (Public Ownership) Act 2024 View all Passenger Railway Services (Public Ownership) Act 2024 Debates 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.
Windsor Framework (Retail Movement Scheme: Plant and Animal Health) (Amendment etc.) Regulations 2024
(1 month, 4 weeks ago)
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Baroness Hoey
That an Humble Address be presented to His Majesty praying that the Windsor Framework (Retail Movement Scheme: Plant and Animal Health) (Amendment etc.) Regulations 2024 (SI 2024/853), laid before the House on 9 August, be annulled.
Relevant document: 3rd Report of the Secondary Legislation Scrutiny Committee (special attention drawn to the instrument)
Baroness Hoey (Non-Afl)
My Lords, I thank the Minister for kindly meeting me last week to discuss these regulations and for having a larger meeting with all the Peers from Northern Ireland on where aspects of the Irish Sea border are affected and where Defra has responsibility. I am very grateful for her time and consideration.
I am deeply concerned by these regulations which we are discussing tonight. Part of the reason for praying against this statutory instrument is to ensure that your Lordships genuinely understand just how important they are, not just to Northern Ireland but to the whole of the United Kingdom.
Ever since the broadcast of the recording of the private meeting where Michel Barnier said that the policy was to use Ireland in order to secure the broader Brexit purposes in relation to the United Kingdom, many of us have felt strongly that the people of Northern Ireland are being used as pawns in a bigger game. We have always worried that the European Union would use the imposition of EU standards on Northern Ireland—as a result of the protocol and the Windsor Framework—to pressurise the rest of the United Kingdom not to diverge from EU standards and so miss out on some of the benefits of having a competitive advantage from leaving the European Union.
The regulations before us tonight provide a very clear articulation of this strategy, but in a form of smoke and mirrors. They impose on Great Britain the same entry requirements for rest of the world goods as to the European Union. This is supposedly in order that those goods should be able to move freely from Great Britain to Northern Ireland without the interference of the Irish Sea border, because the whole of the United Kingdom—not just Northern Ireland—has, in this regard, submitted to EU standards for these areas. This is being presented as some kind of trade off: GB submits to EU standards and then the border, for that purpose at least, can disappear.
This is where the regulations before us are particularly telling. Your Lordships might have expected, given this so-called trade off, that the border that has been imposed, dividing our United Kingdom, would be removed to deal with the rest of the world goods, allowing their genuinely free, unfettered movement from Great Britain to Northern Ireland, but that is just not the case. Under the terms of these regulations, even with our negotiators agreeing to adopt EU standards, the goods still cannot move freely from Great Britain to Northern Ireland: they still have to cross an international customs border and an international sanitary and phytosanitary border.
Some of your Lordships may say, “But surely they can move now, within the UK Internal Market Scheme”—this new title for what used to be called the green lane. It is true that they can move via what the Government call the UK Internal Market Scheme but it is not what anyone else in the world would call an internal market system and it is certainly not what EU regulation 2023/1231, which defines what our Government have called the UK Internal Market Scheme, calls it either. In the real world, an internal market is defined, as we all know, as a market where goods can move freely without having the expense of having to cross an international customs border and an international SPS border. It is what we used to enjoy in this country until 2021, as goods moved freely from one part of the UK to another.
The process that the UK Government call the UK Internal Market Scheme is, frankly, a deceit because it is anything but an internal market system—rather, it is a means of managing its opposite: the international customs and SPS border that now divides our country into two. In essence, what the misnamed UKIMS—or green lane, as it used to be called—offers is a redistribution of the border burden, rather than its removal. On the one hand, the international customs and SPS border requirements are simplified; on the other hand, you have to submit to additional burdens, such as successfully applying for and keeping trusted trader status and submitting to “Not for EU” labelling requirements. In return for GB submitting to EU standards, the EU is not offering that the border be removed for the purpose of those goods, but rather that the border remains and those bringing the goods be subject to an alternative border experience, but a border experience it remains just the same.
First, you can cross the border only with an export number. Secondly, you are subject to customs and international SPS paperwork. Thirdly, you are subject to 100% documentary checks. Fourthly, you are subject to 5% to 10% identity checks at border control posts, which have already cost £190 million and they are not even half finished. Fifthly, you have to successfully apply to become a trusted trader and keep that status. Sixthly, you have to submit to “Not for EU” labelling.
Another striking thing about these regulations is that they put us in a position of complete dependence on the EU. The regulations make sense only because of a prior piece of legislation, which I have already mentioned: EU regulation 2023/1231. This is not a piece of UK legislation but an EU regulation. It is quite impossible to scrutinise these regulations without simultaneously scrutinising EU regulation 2023/1231, because without it the regulation before us would be null and void.
It is important to note some things about this EU regulation. First, it was passed in June last year, more than two years after we were supposed to have left the European Union, and yet its title makes it clear that it not only applies to the UK but to the UK and the movement of goods within it, as if we are some kind of EU colony. Secondly, in this regulation the EU makes it absolutely clear that it governs the border that divides our country in two, reserving to itself the right to pull the alternative border experience that the UK Government have ridiculously called the UK Internal Market Scheme, and default back to a 100% red lane, if it wishes. This means that while we can pass these regulations today, they could be rendered entirely null and void at any time, not because of a decision of this Parliament but because the EU uses its Article 14 powers.
At the end of the day, these regulations are about perpetuating a deep injustice: the division of our country into two by 27 other countries which have chosen to disrespect the territorial integrity of the UK, not just by claiming the right to make some of our laws but through the imposition of an international customs and SPS border. This disenfranchises 1.9 million United Kingdom citizens in relation to not just one area of law but to some 300 areas. I cannot understand how any Government, past or present, who supposedly support the union could have gone along with this.
Lord McCrea of Magherafelt and Cookstown (DUP)
My Lords, I support the noble Baroness, Lady Hoey, and her Motion to annul these Windsor Framework regulations. I understand that these regulations are supposed to make it easier for some rest-of-the-world goods to move to and from Great Britain and Northern Ireland, but there are a number of problems with them, one of which I wish to concentrate my remarks upon.
Let me make it clear: continued barriers to trade between Great Britain and Northern Ireland are unacceptable and undermine the integrity of the United Kingdom. The regulations we are debating are based on recognition of the Irish Sea border, an iniquitous imposition upon the people of Northern Ireland emanating from the Northern Ireland protocol, which had no support from any unionist elected representative in Northern Ireland. One might have imagined that if Great Britain submitted to EU standards like Northern Ireland, the border would to that extent be removed, but these regulations do not do that; rather, they build upon a totally unacceptable foundation.
The best way to understand the border to which these regulations relate is to go behind them to the legislation to which they relate and without which they make no sense—EU regulation 2023/1231. That regulation is considerably more honest, in that it does not pretend to define a UK internal market system but simply an alternative international border experience, enabling goods to move from what is regarded as a foreign country, Great Britain, to what it regards as part of itself, Northern Ireland. I sometimes think the Government believe that the people of Northern Ireland are totally gullible and content to believe that a border is not a border if you simply call it by a different name.
Under these regulations, if rest-of-the-world goods enter the United Kingdom at, say, Southampton, being subject now to EU entry standards, they will be able to move freely from England to Scotland or from England to Wales, because it is an internal market. There is no customs border and no international SPS border. But what happens if the business in Southampton then desires to send the goods to the other region of the United Kingdom, Northern Ireland? The reality is that it has reached the limit of the internal market for goods and that the goods cannot get to Northern Ireland within the internal market in which England, Scotland and Wales are located. Therefore, we have to leave the internal market for goods, cross an international customs and SPS border, and enter another single market for goods. The goods can leave one internal market for another only by crossing the border, and under the regulations before us there is only the option of using the alternative border experience set out in EU regulation 1231.
The noble Baroness, Lady Hoey, has mentioned what that means. It means having an export number; submitting to customs forms, which although simplified are still forms that you do not have to complete if moving goods within the GB internal market for goods; submitting to international SPS forms, which although simplified are still international and not domestic SPS forms; and submitting to 100% documentary checks and to 5% to 10% identity checks.
Then, of course, people do not get access to this border experience, with the simplification of some forms, without having to pay for it by submitting to the additional burden you can avoid via the other, red lane border experience; namely, the requirement to join and remain part of the trusted trader scheme and to have “not for EU” labels. Does the Minister feel that I have misunderstood the present process demanded under the Windsor Framework? If so, can she enlighten me on where I am wrong?
If the provisions in these regulations are somehow meant to make the border acceptable then the Minister is completely misguided. Protecting the so-called integrity of the market that now exists in Northern Ireland is about protecting the results of our being subjected to a different legal regime from Great Britain’s in 300 areas of law. The laws that call the border into being are laws made by a foreign Parliament, in which we in Northern Ireland are not represented. The border is, therefore, in a very real sense, as has already been mentioned, the border of our disfranchisement. What the Minister must answer is this: is she content to acquiesce with our exploitation or will she stand against this injustice?
The previous Government sold the Windsor Framework by stating categorically that Northern Ireland would attract millions of pounds of additional trade, having what they proclaimed was the best of both worlds. But recently, even Invest Northern Ireland now tells us that there is no actual advantage in reality. Who is telling the truth?
The present situation disrespects the territorial integrity of the United Kingdom and violates the Belfast agreement, which this Government and the House proclaim to hold so dear to their hearts. Rather than removing the Irish Sea border, these regulations help cement it in. I am pleased that all unionist representatives in the other House are supporting the mutual enforcement Bill to be debated on 6 December. Surely it will not be possible to ignore the call for mutual enforcement for very much longer.
To conclude, there is a way forward and I know that my party leader and other unionist colleagues are willing to participate in charting a democratic way forward to restore our rightful place within this United Kingdom. I assure this House that the Windsor Framework and the outworkings of the Northern Ireland protocol are not the answer. I support the noble Baroness’s Motion.
Baroness Lawlor (Con)
My Lords, it is hardly surprising that the Secondary Legislation Scrutiny Committee highlighted this instrument as likely to be of interest to the House on the grounds that it is
“politically or legally important and gives rise to issues of public policy”.
To that, I would add that it is constitutionally important.
I am therefore grateful to the noble Baroness, Lady Hoey, for proposing this Motion to annul the regulations. Under them, the UK Government will impose EU import laws on certain packed agri-goods entering this country from the rest of the world such as basil, cut flowers, fruit, and certain chicken products from Thailand and China. Not only, therefore, is Northern Ireland to be subject to the EU’s economic and trade laws, or even the lighter-touch version we are told is the aim of the Windsor Framework for goods going there from GB, but so too is the whole of the UK to be under certain EU laws.
The Government say that they want to promote the integrity of the UK’s internal market. That is something they also claim to desire in the new Product Regulation and Metrology Bill. I suggest that one way to do that is to extend the UK’s post-Brexit trade freedoms to Northern Ireland and continue the serious negotiations for revising the 2019 agreement, which combined sticks with carrots. However, the Government intend to do so by imposing EU laws on the rest of the UK by statutory instrument and instead of the UK’s own statutory regime. That sounds to me to be mighty like the Chequers agreement, which was rejected the by House of Commons three times, but piecemeal and by the back door of statutory legislation. Can the Minister reassure me that this is not the case?
The Windsor Framework, which was at least put to a parliamentary vote, is, like most episodes in the complicated history of my native country, Ireland, testimony to the way difficult problems become intractable, and complexities become overwhelming as a result of political interests which want not to resolve them but to the exploit difficulty for political gain. We heard about some of those interests tonight. The Windsor Framework was announced by the then Prime Minister, Rishi Sunak. It was said to ameliorate the obstacle-ridden movement of goods from one part of the UK to another —Northern Ireland. There was much fanfare, many photocalls with the EU commissioner, warm words and a hotchpotch of operational changes to another flawed settlement imposed by the EU on this country: the Northern Ireland protocol.
However, the protocol was not supposed to be permanent. In parts, it made it clear that both parties accepted the Belfast/Good Friday agreement and the integrity of the UK’s internal market. Each party was also bound to best endeavours legally to resolve what was acknowledged to be a temporary arrangement and designed—I fear—to meet the EU’s desire to keep Northern Ireland as a fief subject to EU economic law. By retaining under its laws part of the sovereign UK, the EU violated the Good Friday agreement, whereby constitutional change must be by the consent of the people, and the promise in the 2019 settlement to respect and accept the integrity of the internal market. This instrument under the Windsor Framework therefore has a flawed pedigree.
I did not vote for the Windsor Framework. I did not and do not support the imposition of EU laws on one part of the UK in violation of this country’s sovereignty without a policy of such importance being a matter of primary legislation. It should not be smuggled in the back door to undo the gains of Brexit for most of this country in order somehow to right the wrongs under which Northern Ireland continues to suffer.
Baroness Ritchie of Downpatrick (Lab)
My Lords, I refer to my registered interest as a member of your Lordships’ Secondary Legislation Scrutiny Committee and of the Government’s veterinary medicines working group.
It will come as no surprise to anybody in your Lordships’ House that I support the Windsor Framework, as I supported the Northern Ireland protocol. Therefore, I do not support the Motion before us to annul this statutory instrument.
I believe that the Windsor Framework was the best means of dealing with the challenges presented by Brexit for trade and goods on the island of Ireland. Before Brexit, goods moved freely across the island, helping to sustain and underpin our economies in Ireland north and south. To take the example of the dairy industry, milk is supplied from farmers in Northern Ireland. It is processed in factories in the Republic of Ireland, and it comes back, either as butter, whey or cheese, and is sold in the north—and vice versa. We have to give that due recognition. This dual nature and, I suppose, the fact of the all-Ireland nature of part of our economy were recognised in the Good Friday agreement, through the three-stranded relationship and the establishment of the political institutions: the Assembly, the Executive, the North/South Ministerial Council, with north-south implementation bodies, of which one was InterTradeIreland, and the British-Irish Council.
Prior to and since the vote on the Brexit referendum, my colleagues in the SDLP and I have always insisted that there was a need for a special status for Northern Ireland due to the unique trading and other relationships on the island. That has not diminished and manifests itself in the Windsor Framework, which exists to manage those challenging trading relationships. Therefore, we enjoy dual access to the UK internal market and to the EU customs union.
Where there are imperfections with some areas of trade, as has been demonstrated by some of the Windsor Framework instruments, they need resolution, not annulment, through dialogue and negotiation between the UK and the EU, as is happening with veterinary medicines—that work is ongoing—otherwise our agri-food industry could be undermined.
Having listened to the noble Baroness, Lady Hoey, the mover of this Motion, and the noble Lord, Lord McCrea, I note the desire to challenge every piece of secondary legislation on the Windsor Framework as an attack on the constitutional integrity of the United Kingdom. I think this is a little bit disingenuous, because notwithstanding the Windsor Framework and my own political position, Northern Ireland remains within the UK.
This was the view of those people—many who sit on the opposite Benches as well as my colleagues from other parties in Northern Ireland—who argued for the hardest possible Brexit. I say to them: sometimes you get what you argued for. Put simply, it would have been better for us to remain within the EU. I am pleased that my colleagues on the Front Bench in the new Labour Government are working with the EU—via the Prime Minister and other senior Ministers, such as the Paymaster-General—on a reset of relationships, notwithstanding the realities of the situation. I hope that leads to a resolution of all the outstanding difficulties and to less tension and brinkmanship. Through less tension and through negotiation, you can build your economy and good relationships based on collaboration and co-operation.
Yesterday there was a meeting of the Specialised Committee on the Implementation of the Windsor Framework, covered by a joint statement. The joint chairs welcomed the operation of tariff rate quotas for certain agricultural products, and they discussed the intensive work under way in the areas of agri-food, customs, medicines and trade. They noted the importance of
“continued constructive joint working to support those efforts and monitor progress”.
We should all support the Government and the EU in that important work to achieve the full and faithful implementation of the Windsor Framework, and to ensure that wrinkles and challenges are overcome and resolved for hauliers, businesses and the logistics industry. I believe that serves the best interests of all in our communities in Northern Ireland, ensuring that the best possible outcomes are achieved for our economy, society and communities.
The purpose of this instrument on the retail movement scheme for plants is to expand the list of agri-food goods imported for retail into GB from the rest of the world that can move to Northern Ireland under the Northern Ireland Retail Movement Scheme, an issue referred to by the noble Baroness, Lady Hoey. This is all achieved by making changes to the entry requirements for importing these goods into GB so that they can align with the EU-derived entry requirements for importing such goods into Northern Ireland. As a member of the Secondary Legislation Scrutiny Committee, I note that we recognised—remember that our job is purely process driven—that this piece of legislation was likely to be of political interest. That is probably why we are debating it tonight.
It is important to emphasise that the changes made by this instrument will ease the movement of certain goods from GB to Northern Ireland via the Northern Ireland Retail Movement Scheme. In fact, Defra emphasises that the changes made by the instrument were sought by business. Those who argue vociferously against this and other statutory instruments do so, they say, on the lack of proper consultation on constitutional imperatives. Can the Minister, my noble friend Lady Hayman, advise us of the type and nature of the consultation that has already taken place with businesses?
It is important to emphasise that businesses want to see a resolution to all the challenges presented by Brexit and the bureaucracy. They have said to me that they welcome any agreement when faced with the catastrophic alternative of a no-deal Brexit. That is why businesses have been fully co-operative in all these areas of the Windsor Framework. Business and trade in Northern Ireland welcomed an agreement that provided continued access to the all-Ireland market, which many businesses in Northern Ireland relied on. Furthermore, business welcomes a unique solution for a unique place, with trade, social, family and emotive ties with both Britain and Ireland. But it also wants any resolution of the wrinkles in the bureaucracy.
Baroness Foster of Aghadrumsee (Non-Afl)
My Lords, I will be brief—I know that most people say that, but I genuinely do want to be. I refer to my registered interests, particularly my recent appointment as chair of InterTrade UK.
Paragraph 107 of the Safeguarding the Union Command Paper states:
“We have therefore already taken forward the steps necessary to enable the expansion of the arrangements permanently to allow at least an additional 26 Rest of World meat and plant products to be covered by the Northern Ireland Retail Movement Scheme. This will include the critical retailer proposal for Thai poultry, as well as Chinese poultry, and a range of cut flowers and herbs, and we will provide the same commitments on safeguards as we have for all existing Rest of World goods covered in the scheme”.
Part 3 of this statutory instrument gives statutory power for the EU-approved poultry meat plants in China and Thailand to be exempted from provisions of animal health law, but EU-approved meat plants in Brazil are not included. This is an important point, although I accept that it is niche. It is especially important for a company that raised the issue with the Secondary Legislation Scrutiny Committee—namely, Universal Meat Company from Northern Ireland. It imports a significant amount of tonnage from Brazil.
In response to concerns raised, Defra has said that the list of products included in the scope of this legislation was developed with industry stakeholders in the United Kingdom on the basis of factors such as the volumes of trade and the impact on supply chains, as the noble Baroness, Lady Ritchie, said. The department went on to list other ways to deal with Brazilian goods. But it would be so much more straightforward if this exemption included those Brazilian plants. In its conclusion, the Secondary Legislation Scrutiny Committee indicated the “importance of consulting widely”, which is an important point—I hope the Minister will reflect on that. It is about not just volumes in a UK context but what matters in a Northern Ireland context. That is important.
Given the specific concerns about Brazil and the fact that the factories concerned there are EU approved—it is important to say that—can the Minister proactively look again at this specific issue? The volumes may not be as large as the two countries listed—China and Thailand —in respect of poultry meat in UK terms, but, for Northern Ireland, Brazil is a significant supplier and its absence from this list will impact on the supply chain, consumer choice and customer cost. That is an important point.
Noble Lords are aware that I have been appointed chair of Intertrade UK and, while I await terms of reference from the Government, I intend to closely monitor the impact of statutory instruments. It is important that we have these debates and find out where there are difficulties, such as the one before the House today. I thank the noble Baroness, Lady Hoey, for bringing this Motion to the Floor of the House; otherwise, we would not have had the opportunity to raise what are important issues for suppliers, businesses and consumers in Northern Ireland. It has given me the opportunity to raise this specific concern and I hope the Minister can address it.
Lord Frost (Con)
My Lords, I too can be quite brief, but there are a few points I want to register. I thank the noble Baroness, Lady Hoey, for the Motion and for her helpful remarks.
These regulations testify to something we always feared: that differential arrangements for Northern Island, in which it remains closer to EU laws and rules, would end up being exploited to restrict our freedom and keep the UK-EU relationship one of high alignment, and that is what has happened. It has become harder to get the gains of setting our own laws in our own interests, and there is a risk that we remain in the political and psychological tractor beam of the EU. And so it has proved.
Ever since the original sin, as I regard it, of the joint reports in December 2017, it has been impossible to entirely undo the agreement about the imposition of EU law in Northern Ireland. The Johnson Government, both when I was responsible and under my successors, tried to water down commitments and made it clear they could not be durable, and eventually did their best to unpick it, culminating in the Northern Ireland Protocol Bill, which was so intensely disliked in this House. But that Bill fell, with Prime Ministers Johnson and Truss, and the Sunak Government, having promised one thing, then did another and agreed the Windsor Framework. This did little to improve the situation in practice, but the big change it did make was that the British Government were now actively committed to defending protocol-like arrangements, and that meant defending EU interests in areas covered by the protocol in Northern Ireland.
What we are seeing happen with the regulations today is what we always said would happen: the easy way out would always be taken, and we would increasingly choose to align ourselves with EU laws rather than go our own way. These regulations mark a new stage in that process. Hitherto, the Windsor Framework arrangements were confined to the GB-Northern Ireland “border”, but now we are also aligning a GB external border with EU laws—admittedly for a limited category of third-country goods. As others have said, including my noble friend Lady Lawlor, it will not end there. The Product Regulation and Metrology Bill, which is also being considered by your Lordships’ House, has exactly this purpose in mind, and is much more sweeping in what it can do. As the noble Baroness, Lady Hoey, pointed out, this pre-emptive legislative cringing to the EU hardly even brings us any benefits. It still does not improve the “border processes” between GB and Northern Ireland, and the same will be true of the product regulation Bill.
As I have said before, these arrangements make little sense unless they are the first stage in a process in which the second stage will be formal adoption of EU laws enforced by EU methods. That is, of course, how you get the paperwork to be eliminated, but at what price? We have the gradual watering down of this country’s democracy still further in favour of laws set elsewhere.
To conclude, there are only three possible destinations from where we are. I have just described one, which is the gradual, further dissolution of UK sovereignty in important areas of the economy. The second is an attempt to make the unworkable work, to constantly offset the complexities and the nonsensicalities of the Windsor Framework by more and more complex legislation, with more and more exemptions and special treatment, creating a bigger regulatory burden and, in practice, separating out Northern Ireland still further. If we go down this road, we will be dealing with more and more unsatisfactory pieces of legislation like this one.
The third route is the one that, one day, must be taken and has been referred to already, and that is the route of mutual enforcement, for the Windsor Framework to be ditched and for UK laws to apply in Northern Ireland, as they do anywhere else in this country. In my view, that is the right way forward. I do not think the current arrangements can or will stand. They are overcomplex, create too many political anomalies and simply will not work over time, and it is only a matter of time before that becomes clear. One day, we will sweep away the Windsor Framework and make this a properly United Kingdom once again.
Can the Minister say which of these three paths she believes the Government are on? What is their approach to the Windsor Framework, and what is the direction of travel?
Lord Bew (CB)
My Lords, I thank the noble Baroness, Lady Hoey, for giving us a chance to have this debate. I find myself in a slightly confused frame of mind, in that I agree with much of what the noble Lord, Lord Frost, has just said about the 2017 agreement and its consequences. However, we are where we are. There is as much chance of mutual enforcement becoming an acceptable solution to this crisis as there is of all the European countries and the United Kingdom deciding that the dictatorship of the proletariat is the best way forward for governance—in fact, there is rather more chance for the dictatorship of the proletariat. To tell the people of Northern Ireland to keep on going, that mutual enforcement is somehow a realistic option, is misleading.
On the disfranchisement of the people of Northern Ireland, the truth is that the Assembly will vote on this matter. I know there are those who dislike that. The major change between the Johnson agreement and the May agreement was putting in that there should be a vote in the Assembly on any new arrangements, giving the Northern Ireland Assembly a chance to vote. As for the talk about 1.9 million people being disfranchised, they are not being disfranchised—they are going to get a chance to vote. I understand the objection to the form of the vote, which is by a majority vote, although that is so because trade matters are actually the responsibility of the United Kingdom Parliament. It was a special concession to give a vote to the Assembly on this occasion. In 1938, at the time of the very controversial Anglo-Irish trade agreement, the unionist MPs all accepted it was nothing to do with Stormont; it was a matter for the Westminster Parliament even though they were concerned it was unfair to Northern Irish businesses. A special case has been made for this vote.
In 2017, there was a general election in Northern Ireland. The DUP got 36% of the vote—it is closer to 20% now. The total unionist vote is little short of 50%. When it was agreed in 2019 that the Assembly would have a majority vote on this matter, it was not so obvious what the outcome would be. Today it is, but when that was agreed to in 2019, it was not at all obvious that a majority vote would be acceptance of the Windsor Framework arrangements, as we are all sure it will be now. It was not at all sure, and it was not inevitable.
There is an argument that one reason why the unionist vote has collapsed is the constant putting forward of solutions which are not solutions, like the mutual enforcement scheme. There is nothing at all wrong with it, had it been serious five years ago. We are now three international treaties down the road, and the European Union is not going to change its mind, and Parliament voted by a huge majority for the Windsor Framework. There is more chance of the dictatorship of the proletariat being decided as the way forward for Europe and the United Kingdom than the idea that suddenly people are going to turn round and say, “Let’s try something else completely different”—considerably more chance.
I have made general observations of where we are, and it is with regret that I say some of this because I think mutual enforcement should have been more properly discussed. The 2017 agreement is deeply flawed and set a framework which leaves us with many remaining difficulties which we have to talk about. None the less, this is where we are. I hate to be so simple about it, but it is the case.
Lord Browne of Belmont (DUP)
My Lords, I support the Motion moved by the noble Baroness, Lady Hoey. The regulations referenced in this evening’s Motion do not deal with the imposition of the large swathes of EU law which impinge on Northern Ireland’s economy. The regulations before us are intended to expand the range of goods—namely, Thai and Chinese poultry, and cut flowers from the rest of the world—that are eligible to be supplied to Northern Ireland from Great Britain under the retail movement scheme. These regulations are not a solution to the long-term problems born of the protocol. In imposing on Great Britain EU standards that already apply to Northern Ireland, these regulations evidence a desire to use that fact to seek to undermine Brexit in the rest of the country.
It is a strange anomaly that although EU regulation 2023/1231 was made after the UK left the European Union, it relates only to the governance of the United Kingdom and not the European Union. The United Kingdom Government have not scrutinised this legislation and have no power to alter it. Is it really acceptable that laws which apply only in the United Kingdom should be made by a foreign entity of which we are not a part?
Far from removing the barriers to trade between Northern Ireland and the United Kingdom created by the protocol, the Windsor Framework has entrenched many of these and will impose heavy costs on Northern Ireland/Great Britain trade and damage living standards in Northern Ireland. I know that my time is brief, so I will consider just a few points.
It has been argued that the restrictions on state aid set out in the protocol have been significantly eased by the de minimis regulations introduced on 1 January 2024. Unfortunately, this is clearly not the case, since the United Kingdom Government’s capacity to provide financial support to Northern Ireland’s large businesses remains severely limited. This may have made it impossible for the last Government to provide the necessary funds to prevent the Harland & Wolff shipyard in Belfast going into administration. Can the Minister clarify the position regarding the future operation of the Belfast shipyard, in particular the building of naval ships?
The negative consequences of the United Kingdom fulfilling its commitment to extend the requirement for “not for EU” labelling to products consumed in Britain should not be overlooked. This will cause the isolation of the Northern Ireland market, since the increased cost of providing a small product line with different labelling for Northern Ireland will inevitably disincentivise many British traders from supplying goods to Northern Ireland. Can the Minister explain why the Government have reneged on their commitment to introduce this legislation throughout the United Kingdom?
I warmly welcome the arrival of the mutual enforcement Bill, which I see has now been propelled to Second Reading in another place. Unlike the regulations before us today, the Bill provides a sensible solution. It replaces the Irish Sea border—which violates the Belfast agreement in disfranchising the people of Northern Ireland—with mutual enforcement, which disfranchises no one and restores the territorial integrity of the United Kingdom without requiring border infrastructure on the Northern Ireland/Republic of Ireland border.
Finally, we were informed that the protocol would bring prosperity and untold opportunities for business. To date, I believe that there is very little evidence to show this. I support the Motion.
Baroness Suttie (LD)
My Lords, this has been a characteristically impassioned debate and, with the notable exception of the very pertinent points made by the noble Baroness, Lady Foster, it has perhaps been rather less about the substance of the regulations before us and more about concerns of identity; but as the noble Lord, Lord Bew, said in his very thoughtful speech setting out the historical context, we are where we are. From these Benches, we welcome the Government stating that they are fully committed to implementing the Windsor Framework in good faith and protecting the UK’s internal market. If the noble Baroness, Lady Hoey, pushes her fatal Motion to a vote this evening, we will not be supporting her.
On the substance of these regulations, I can be extremely brief. These changes, which are fairly limited in scope, impact Scotland, Wales and England and are necessary, we believe, to make the Windsor Framework work in practice. It is welcome that the Government consulted with the devolved Administrations of Scotland and Wales and have received legislative consent from both. But, turning to some of the wider issues that these regulations raise following the change of government, this can be seen to be the beginning of a wider debate about our general approach to alignment with or divergence from the EU. We are going to have to debate whether we want divergence for divergence’s sake, which I would argue is the logical consequence of some of the speeches we have heard this evening, or whether we wish to align whenever possible with our European partners where it makes sense to do so. If we wish to align with EU legislative changes as they happen, this inevitably raises questions about the democratic deficit and being a rule taker.
As someone who was very much against leaving the European Union, I think it is worth recalling from time to time that prior to Brexit we had MEPs, a commissioner, Commission officials and Ministers who were all in a position to debate these issues in Brussels before, during and after the legislation was developed by the EU. Now we have to decide whether or not to follow these changes without having any say—but that was the decision taken in 2016. Ultimately, this is about managing divergence with our biggest market and keeping up with changes as they take place within the European Union. The business community, in particular, is keen to have clarity on this. Like the noble Baroness, Lady Ritchie, I would be very grateful if the Minister could say a little more about what discussions are taking place with the business community on the possible consequences of divergence.
Turning to the democratic deficit, it is welcome that the Liaison Committee of this House is considering establishing a Northern Ireland scrutiny committee. Such a committee could replace the very important work previously carried out by the Northern Ireland protocol committee. But it is also important that we continue to debate many of these issues as fully as possible, including in this Chamber. In that regard, it would be very useful to have a debate in government time on the future approach to the Windsor Framework as well as the wider government approach to EU trade. Can the Minister in her concluding remarks give a brief update on where we are with practical re-engagement with the EU? In particular, can she say a little more about where we are regarding agreements on SPS and on veterinary matters?
Lord Roborough (Con)
My Lords, I declare my farming and land management interests as set out in the register. I thank the noble Baroness, Lady Hoey, for introducing this Motion and for raising the key issues for people living in Northern Ireland. I also thank all noble Lords who have contributed to the debate with such passion and energy and who have candidly shared their deep frustrations.
From the outset, I would like to confirm my personal commitment and that of my noble friends on this side of the House: we are all dedicated unionists. We also remain strongly supportive of the importance of implementing the Windsor Framework agreement, securing the application of British standards for goods which move to and stay in Northern Ireland, and ensuring that the same goods are available for consumers in all parts of the UK. It upholds Northern Ireland’s access to the rest of the UK internal market and safeguards Northern Ireland’s privileged access to the EU single market, which has been a clear demand from businesses in order to protect livelihoods.
Following the question asked by the noble Baroness, Lady Hoey, earlier in this debate, I too hope that the Minister can restate the Government’s manifesto commitment:
“Labour is committed to implementing the Windsor Framework in good faith and protecting the UK internal market”.
I also ask the Minister to confirm that this instrument is consistent with the Safeguarding the Union Command Paper, published in January 2024. In line with the concerns raised by the Secondary Legislation Scrutiny Committee, and that we have heard today from my noble friend Lady Lawlor and the noble Baroness, Lady Ritchie of Downpatrick, I would also like to press the Minister to explain to the House the extent of the consultation undertaken. What is the nature of the parties that have been consulted? How many have been consulted and on what questions? Is it possible to publish the anonymised consultee responses? Has the policy been adjusted or impacted by any of that consultation to arrive at the position we see it in today? If so, whose responses carried the most weight?
In addition, how would the Minister respond to concerns expressed by many noble Lords that this instrument appears to be intent on aligning with EU law and thus has constitutional significance? As is the custom in this House, we on these Benches will not be supporting the fatal Motion on an instrument such as this, but I hope the Minister will listen carefully to noble Lords’ concerns.
The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Baroness Hayman of Ullock) (Lab)
My Lords, I start by thanking the noble Baroness, Lady Hoey, for introducing this Motion and allowing us to have such a detailed debate on this issue. I also thank all noble Lords who have contributed to the debate, some with a great deal of passion and energy. I know this is a subject close to many noble Lords’ hearts.
I draw noble Lords’ attention back to the very positive impact that this legislation will have on the union of the UK and on businesses and citizens right across our country. This statutory instrument will enable a broader group of goods originating from the rest of the world to move via the Northern Ireland retail movement scheme from GB to Northern Ireland. This enhances the existing measures in the Windsor Framework, which have already significantly reduced the requirements associated with the original Northern Ireland protocol. The list of eligible goods, which already includes products such as tomatoes, cauliflowers and New Zealand lamb, was designed in collaboration with industry stakeholders across the UK. Recently, I had a constructive and helpful discussion on the Windsor Framework with the Northern Ireland Business Brexit Working Group when I went to Belfast in August.
The Government will keep under review the movement of products from the rest of the world. We need to ensure that we can reflect and respond to industry feedback. My officials meet with businesses on a regular basis to discuss these matters and to support them in implementing the Windsor Framework, which I confirm to the noble Lord we are committed to delivering. This legislation delivers on a key commitment of the Safeguarding the Union Command Paper, which was published earlier this year and which the noble Lord also inquired about. As colleagues know, that provided the basis for the return of the Northern Ireland Executive.
In addition to expanding eligibility for goods from the rest of the world to use the Northern Ireland retail movement scheme, the Government are committed to supporting businesses in moving agri-food goods into Northern Ireland. To that end, since 30 September, the new tariff rate quota solution enables traders to take advantage of UK tariff quotas of over 13,000 tonnes of lamb, beef and poultry every year. As set out in our manifesto, this Government have been clear in their objective to secure improved arrangements for agri-food trade with the EU via a veterinary or SPS agreement. We are clear that we want to continue to simplify this process, as far as possible, to support the UK’s thriving agri-food trade.
Baroness Hoey (Non-Afl)
My Lords, I thank the Minister for her response. It has been a very wide-ranging debate, as these narrow debates on Northern Ireland tend to be. I thank all noble Lords who have spoken. I also thank the two GB Lords, as I might call them, the noble Baroness, Lady Lawlor, and the noble Lord, Lord Frost. In most debates on Northern Ireland it is just Northern Ireland Peers who take part, so their contributions were encouraging and very welcome.
As well as general support, there was at least a recognition that there is an alternative. Mutual enforcement, which was mentioned by a number of Peers, is something that we are going to hear a lot more about because of the Private Member’s Bill in the other place. I welcome what the noble Baroness, Lady Suttie, said about the importance of setting up again some kind of scrutiny committee for what is happening in Northern Ireland.
Also important, perhaps, is a wider debate. I am aware that many Members have been held back tonight, because I did say that I probably would not press this to a vote, so I welcome that there are so many here. As I said earlier, it is very useful for people to understand why many of us feel so strongly about the Windsor Framework and its effects, and not just on Northern Ireland—I reiterate that.
It would be helpful if those who think that the Windsor Framework has been a benefit, because of the dual access, listened to what Invest Northern Ireland said last week. There has been no benefit whatever from any of the so-called joint access because we have lost direct access from Great Britain. So many businesses are not sending things to Northern Ireland any more. But that is for another debate.
I hope that I will not have to have many more of these. However, the consent issue and the vote that is coming up are very controversial. I hope that noble Peers understand how people in Northern Ireland feel about the fact that, on this one crucially important issue, a reason has been found to make it majority voting and not cross-community. Many who support that are doing so for reasons that not many of us in this House would agree with. I beg leave to withdraw the Motion.
Passenger Railway Services (Public Ownership) Bill
Wednesday 23rd October 2024
(1 month, 4 weeks ago)
Lords ChamberRead Full debate Passenger Railway Services (Public Ownership) Act 2024 View all Passenger Railway Services (Public Ownership) Act 2024 Debates 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.