(1 day, 11 hours ago)
Lords ChamberRead Hansard Text Read Debate Ministerial Extracts
Lord Moylan (Con)
My Lords, in the light of that last vote on the Bill, I will have to be very careful about what I say to ensure that it does not offend staff.
It must be tough being the Secretary of State for Transport, because every time the Government are in difficulty with their Back-Benchers she is sent out to make another announcement about some great, distant spending plans. Of course, all the rail announcements made in this Statement were in fact announced by the previous Government. Before the Minister says, “Where was the money?”—and when he does say that, it displays a certain frailty of constitutional grasp—the fact is that, had the previous Government been re-elected, there would have been a spending review, just as this Government have had a spending review, and the schemes that this Government have announced would be in that spending review. That was the pledge; that is how our constitution works.
Part of this Statement is not about announcing new rail schemes but about cancelling road schemes. We are not going to get the widening of the A12 or the A47 scheme from Wansford to Sutton. They are gone for the foreseeable future. However, I will turn back to the rail schemes, as my few remaining remarks will be about them.
We find ourselves in the extraordinary position of being asked to celebrate rail expansion when the Government have still failed to lay the Great British Railways Bill before Parliament. Great British Railways, optimistically suggested for late 2026 at the earliest, now appears increasingly likely to slip to 2027 or beyond, with the legislation yet to appear before either House of Parliament. Perhaps the Government have finally realised that centralising control of our railways is not the simple solution that they once claimed it would be. The complexities of their grand nationalisation project appear to have caught them rather off guard.
So my first question to the Minister is: where is the Bill? Where is Great British Railways? More pertinently, where is shadow Great British Railways—which already has a remunerated chair—in these announcements? The relevance of that is that, under the Government’s scheme and their plans for rail, proposals such as this—the expansion of the rail network—are meant to be proposed, worked up and delivered by Great British Railways, subject to government funding, not the other way round. We are not even sure that all these schemes will necessarily be carried out, because what guarantee is there that they will be a priority for Great British Railways when that body comes into existence? Is it, in fact, merely a puppet for the department after all, as we suspect might be the case?
When we were debating the Passenger Railway Services (Public Ownership) Bill, which began the process of nationalising the train operating companies, I warned that the Government were moving not from one state to another but from one state to a huge transition period. That is what we are in at the moment: a transition period where we have no idea who is in charge of the railways and no real accountability. It is a governance mess. The Department for Transport continues its iron grip on the rail operators, which it now owns through subsidiary companies, with civil servants in effect running train services while the promised arm’s-length body remains a distant aspiration. This raises fundamental questions about whether their calls for rail growth are genuine or merely a smokescreen for increased state control.
The Government’s actions speak louder than their words. The Office of Rail and Road, under instruction from the Secretary of State, has already rejected eight open access operator contracts, despite compelling evidence that competition drives service improvements and passenger growth. That ideological opposition to open access operations flies in the face of economic evidence and passenger benefits. Consider the transformative impact of operators such as Grand Central and Hull Trains, which have brought direct services to previously underserved communities in Sunderland, Scarborough, Bradford and Hull. These are not abstract policy successes but tangible improvements to people’s lives, connecting communities that had previously lacked such direct rail links.
Independent research by Arup and Frontier Economics provides unequivocal evidence of competition’s benefits. On corridors with open access competition, service frequency rose by up to 60% and total passenger numbers increased by approximately 40%. Those are not marginal gains; they represent the kind of transformational improvements the Government claim to seek through their infrastructure spending. Yet instead of embracing this proven model for growth, they actively suppress it.
If this Government were truly committed to rail growth, they would be encouraging, not stifling, the competition that demonstrably delivers increased services and passenger numbers. The fact that they do the opposite suggests that their rail policy is driven more by ideology than economic efficiencies.
The delays to Great British Railways reveal a Government who perhaps underestimated the complexity of their grand nationalisation project. What was once promised as a streamlined solution now appears mired in the very bureaucratic inefficiencies they claimed to oppose. The latest date we have for the Great British Railways Bill to appear is the autumn. Will the Minister confirm that date or will he have to say, as is now widely believed in the industry, that he will not make that deadline and that the Bill will be coming much closer to Christmas at the earliest?
This House has a duty to scrutinise not just the Government’s spending commitments but the coherence of their overall transport strategy. We cannot properly fulfil that duty when key legislation remains unpublished and when policy appears to contradict evidence. The Government must explain why they continue to reject open access applications when the evidence so clearly demonstrates their value. They must clarify when Parliament will finally see the Great British Railways Bill and they must reconcile their rhetoric about rail growth with their actions that constrain it. Until then, I fear we are being asked to applaud announcements while the fundamental questions about rail policy direction remain unanswered. The British public deserve better than this policy vacuum masquerading as progress.
Baroness Pidgeon (LD)
My Lords, I will focus on the Statement and the rail and road projects contained within it and, perhaps, those not within it. Across the country, communities have been let down by a transport system that is creaking, crying out for investment and improvement, and was neglected by the last Conservative Government. Constant announcements and reannouncements of transport projects were made, with what appeared to be fictional budgets that never materialised, while our roads and railways deteriorated. The public have been let down.
A safe and reliable transport system is vital for economic growth, and therefore this capital investment is welcome news for the communities that will benefit. In particular, I welcome the Midlands rail hub, the east coast main line being upgraded with digital signalling, new stations at Wellington in Somerset and at Cullompton in Devon, the east-west railway line to Cambridge, and over £2 billion for Transport for London to continue with the purchase of new Piccadilly, Bakerloo and Docklands Light Railway trains. We await the detail of Northern Powerhouse Rail—the Statement says “soon”, whatever that might mean.
It would be helpful, given the hopes raised in the past, for the Government to provide details of the timescale and how the money will be spent to deliver the projects outlined in the Statement. The Statement also confirms that many other schemes will now need to be reviewed. These are projects that are paused or effectively scrapped. I am particularly concerned about the pause to the electrification of the Midland main line from London to Sheffield. Given the removal of the High Speed 2 leg to Sheffield, it feels as if Labour is letting down Sheffield and South Yorkshire by once again cutting major investment in its railway, leaving Sheffield as the largest city in Britain without an electrified railway. When can we see this important project back on track?
I am also deeply concerned that stage 5 of the resilience programme in Dawlish has not been funded. It would take only one large storm to close the railway to the south-west once again. Monitoring is not enough, and I hope the Minister, as the former chair of Network Rail, will assure the House about the future of this project. Then there is the busiest interchange station in the entire country, without step-free access to platforms or accessible facilities for passengers. Its platforms and corridors are far too narrow for a station with around 6 million entries and exits a year. Planning permission has been granted and it is ready to start construction next year, but the project has been put on hold. What am I talking about? Peckham Rye in south-east London. This is such a busy and important interchange. When can we expect funding for this vital project?
Finally, away from the specific projects that I have outlined, can the Minister give a firm assurance that the Government have learned from the overruns of High Speed 2 and Crossrail, and that all these projects will be delivered on time, on budget and using technology such as digital twins, where appropriate, to ensure value for money for the taxpayer?
The Minister of State, Department for Transport (Lord Hendy of Richmond Hill) (Lab)
My Lords, I am pleased that the noble Lord, Lord Moylan, said so much about other things. He did not have much to say about the list of funded schemes, so I am concluding that, by and large, he is happy with what he has read in the Secretary of State’s Statement in the other place. He makes a lot of noise about the fact that they would have been in some spending review had his Government been re-elected. They were not. Before that, however, they had published documents with endless numbers of schemes that were, frankly, never likely to be funded. There were promises everywhere but funding nowhere. The best example of that is the notorious Network North document. Incidentally, it included Tavistock and a number of other places not in the north of England at all, but the characteristic of all the entries in that document was that none of them was ever funded.
He does not have to listen to me about this, although it is a pleasure to speak to the House now. My predecessor, Huw Merriman, was in front of the Transport Select Committee a few days ago and said:
“A lot of promises were made to MPs and others as to the ambition, but it did not match the amount that was actually being set down. By the time I came into post I ended up with a list that was much longer than could be funded”.
That is true: around the country, all sorts of communities were promised transport schemes by the previous Government that were never likely to be funded and were not funded. Somebody has to sort that out and announce a programme that will bring long-term economic prosperity around Britain, get schemes built and stop a lot of money being spent on endless scheme development without the schemes being delivered. This is such a list, and this list will be delivered. The funding is in place through the spending review to do it, even though there is less than we would like because of the lamentable state of the economy at the time this Government took over.
The noble Lord, Lord Moylan, has a lot to say pejoratively about the Government’s rail reform and he continues to ask where the Bill is, but he knows perfectly well that progress can be made without the Bill. Indeed, the purpose of the Passenger Railway Services (Public Ownership) Act 2024 was to start the process of bringing passenger operations back into public ownership. The consequence is that we already have two parts of the railway controlled by one person, both the infrastructure and operations. That will allow better reliability, increased revenue and reduced costs. Things are happening today that were not going to happen under the previous regime, and which will produce a better railway. That is important.
The noble Lord says that civil servants are running train services. Actually, I note that Steve White at Southeastern Railway and Lawrence Bowman at South Western Railway are good railway people. They are not civil servants; they are public servants, and they intend to run those businesses for the benefit of the travelling public and the British economy.
The noble Lord talked a bit about open access. What he failed to say about the applications that the Office of Rail and Road recently rejected is that it did not reject them on any competitive grounds; it simply rejected them, most recently, because of a lack of capacity in the railway system. Those train services could not run, and if they had then they would have disturbed further—or, rather, reduced—the reliability of the system.
One point about the list of schemes—lamentably, he did not go into it in detail, but I could—is that many of those schemes will help the railway to run by improving its capacity, such as the digital signalling on the southern end of the east coast main line, which the noble Baroness referred to. The list is starting to look at improving railway capacity and reliability, which was not a feature of many of the Network North schemes—even though they were not funded—but is a feature of these schemes. This is part of the Government’s intention for a long-term investment strategy, and the schemes announced by the Secretary of State last week are an important part of that. I absolutely contend that the Government are on track to deliver what the economy needs in terms of local transport, particularly in the Midlands and the north; to deliver on road schemes without having a horrifically long list of schemes that were encouraged but never likely to be funded; and to start to do things on the railway that will make a real difference.
The noble Baroness, Lady Pidgeon, was much more focused on the announcement itself, for which I am sure both I and the House are grateful. She enumerated a number of the schemes in the announcement; I am pleased that she welcomes those, as the rest of us will. There will be an announcement on Northern Powerhouse Rail shortly. I will not define “shortly” today; it needs to be worked out with the combined authority mayors in the north of England, which is the reason for some delay. On the road schemes, details of the timescales will emerge as road investment scheme 3 is put together and announced in the early part of next year. On the railway, we will now move forward with the schemes that have been announced.
The noble Baroness is of course right that there are well-known projects and schemes that have not made this list, particularly railway schemes, principally because the other thing that the Government did, as the Chancellor announced as part of the spending review, was to fund HS2 to continue to be delivered alongside the wholesale revision of its governance and management, which will make spending that money more successful.
That does not mean that everything that one would have wanted to have been done is capable of being done for the moment. In particular, the noble Baroness referred to the electrification of the Midland main line, which has got to Syston, near Leicester, but will not go forward, at least in this spending review programme. What will go forward, however, are the bi-mode trains that take advantage of the wires, where they are up, as well as the improvement of the power supply and resilience of the existing wiring south of Bedford, which is quite old. Sheffield, Derby, Nottingham, Leicester and other major places on the Midland main line will see a betterment of service due to the introduction of the new trains in the autumn. I think we all want to regard future electrification as a deferral rather than an abandonment.
The noble Baroness referred to phase 5 of the scheme at Dawlish in Devon on the resilience of the Great Western main line. Phases 1 to 4 were principally about repairing the sea wall and the damage created 10 years ago by an exceptional storm, whereas phase 5 is looking at the stability of the cliffs behind the railway, which indeed should be the subject of future work. The remediation, and indeed the speed of movement, of those cliffs is worth monitoring now, whereas the work that has been done up to now has been on the basic resilience of the sea wall in order to keep the railway running.
The noble Baroness is right about Peckham Rye; it is the largest interchange station, but the scheme is, at least at present, unaffordable. Although, again, I would expect that to form part of a longer-term enhancement pipeline. It is regrettable that there are things across the railway that everybody would have wanted to see, but there is simply not enough money for them.
The noble Baroness is right about the lessons from recent projects. We have talked in this Chamber about HS2 and the need for new management, governance and a focus on understanding what is being delivered at the time the money is spent. The Government, frankly, should be commended for their commitment to continue HS2, which will produce large-scale economic benefit in the Midlands while that process takes place. Not everything is bad in the railway project firmament. Indeed, the trans-Pennine upgrade and east-west rail are so far on time and on budget. Learning from those is as important as learning from HS2, which, sadly, is neither.
Finally, the noble Baroness referred to digital twins. My noble friend Lord Vallance has a lot to say about digital twins for the whole of the Oxford to Cambridge arc, of which east-west rail will form part. Its use in project management is only in the foothills but it needs to be increased. I agree with her on that, too.
Baroness Bennett of Manor Castle (GP)
My Lords, my question is about the accuracy of the Statement. I hope the Minister will be able to reassure me that it is accurate. I refer to the third page, under the headline “Major road network”, and the Government explaining
“why we extended the temporary cut in fuel duty at the last Budget”.
That temporary cut has been going on since 2011, since when the fuel duty level has been frozen at or below 2010 rates. This has cost the public purse £130 billion thus far and, if it is not temporary and is to continue until 2030, will cost £200 billion. Of the beneficiaries of that, the top quintile by income gets 24% of the benefit—that is all those Chelsea tractors—while the poorest quintile gets only 10% of the benefit. Some of this money might, for example, be spent on at least keeping the £3 bus fare or going back to £2 bus fares. Can the Minister assure me that this is only, in the Government’s mind, a temporary cut in fuel duty?
Lord Hendy of Richmond Hill (Lab)
I am sure the noble Baroness will know the answer to that. As I said at Questions, taxation is a matter for His Majesty’s Treasury. The Chancellor will determine taxation policy from time to time.
Lord Berkeley (Lab)
My Lords, I congratulate the Secretary of State and my noble friend on producing a comprehensive list of railway and road schemes they intend to go ahead with. This is the first time that we have seen such a list for years. In her introduction, the Secretary of State says that she is green-lighting over 50 rail and road projects. I am not sure whether green-lighting is all right, because occasionally greens go to orange and red, but I hope that is wrong. Within the text, there is quite a lot of uncertainty about which schemes are going ahead and which are what Ministers call “paused”. Pausing could happen for just a week or for a year. It would be useful, the next time Ministers do this, to spell out what pausing means.
One of the schemes paused is the Dawlish scheme mentioned by the noble Baroness, Lady Pidgeon. I have an interest as I live down the other end. I am not suggesting the work should start now but, as my noble friend said, monitoring should continue because, if the cliff does come down—it could happen quite quickly if it does—it will put the south-west in a very difficult position.
Could my noble friend, over the next week or two, publish a short paper giving the criteria used for going ahead with or pausing different schemes? It can apply to roads as well as to rail. We have had so much stop-start over the last few years, for reasons we need not go into. It would be nice to know what the reasons are. What are the criteria? Is it that there is a good business case, is it because the local MP knows the Minister very well, or is there some other good reason? I am sure there are good reasons for the decisions, but it would be helpful if Ministers could come up with that in the next few weeks. Otherwise, I congratulate the Minister on a good, comprehensive document.
Lord Hendy of Richmond Hill (Lab)
I am grateful to my noble friend for his compliments. Of course, the real significance of this list is that it is a funded list, rather than one that is not funded—a list of aspiration and hope. I am not too sure about the phrase “green-lighting”; I am not too that it is in the dictionary and, if it is, it is a shame. What it means is that these are funded schemes to go ahead. One or two still need development consent orders, which is a process that has to be taken to a conclusion. Therefore, the start dates will be different across the huge list, but many are ready and have been waiting for funding for quite a long time.
On the pausing at Dawlish that I referred to in the discussion with the noble Baroness, Lady Pidgeon, monitoring will take place. It is not that it “should” take place. The monitoring of those cliffs needs to continue. My understanding of the situation, which I have to say is from the last job I did rather than this one, is that monitoring those cliffs is essential. The work needed to remedy all this is, at least partially, about what we see in the monitoring process, so it is sensible to look now and do something when agreed.
Will we publish a paper on the criteria that have been used? There are two things here. One is that the Government have decided to do these schemes and have taken a view, from the wreckage they inherited, to prioritise things that need to be done that will contribute to a better local economy. We will get on with doing that first. In the longer term, there is an intention to have both a 10-year infrastructure strategy and a long-term railway plan. In conjunction with the revision of the Green Book that the Chancellor talked about in the spending review—to look at aspects that allow projects in parts of the country with lower rates of economic activity to benefit—I think there will be a case to publish a long-term railway plan and talk about the criteria used. For now, we will get on with what has been announced.
Lord Wigley (PC)
My Lords, the Minister is familiar with the intricacies of the Barnett formula. I know that because he has quoted it to me in the past. Will he therefore confirm that the Barnett formula, as far as rail is concerned, will indeed generate money for Wales from those projects that are England-only, such as the Oxford to Cambridge line? Will he also confirm what the First Minister of Wales has called for—for Wales to get the Barnett consequential of that expenditure?
Lord Hendy of Richmond Hill (Lab)
The noble Lord is right: this subject has come up before. There is a real difference in the current circumstances. Rail projects are all classified as England and Wales in the way that this is done. The real difference in this list is that, for the first time, there is a significant commitment to funding rail enhancements in Wales: £300 million or so in the spending review period, and a total of over £450 million in 10 years.
The current Welsh Government, particularly Ken Skates—whom I happened to meet this morning on the subject—and the Secretary of State for Wales, agree that the schemes that have been announced for development and implementation are the right ones. There are schemes for the south Wales main line arising from the Burns report, and there are schemes for the north Wales main line to improve train frequency and connectivity. There is a scheme for Wrexham to Bidston—curiously, in these documents it is referred to as Padeswood sidings, about the most obscure title that you could imagine—which is designed to make some freight improvements to double the frequency from Wrexham to Bidston. There are also a number of other things. The significance of this announcement is that it commits money to Welsh railway schemes— schemes that the Welsh Government agree need to be taken forward as the most urgent—and I hope that the noble Lord welcomes that.
Lord Teverson (LD)
My Lords, like my noble friend, I was rather surprised by the tone of the Official Opposition, given the billions of pounds wasted on HS2 just to provide a shuttle—a high-speed shuttle, admittedly—between a north London suburb and Birmingham. What a waste of time and national resource that was.
I very much welcome a number of initiatives in the Statement. Like the noble Lord, Lord Berkeley, I travel up from Cornwall normally, and I welcome the stations at Wellington and Cullompton, and the opening of the line to Portishead, for which we have waited for some time. The Minister mentioned the Tavistock line, and I rather regret that it looks like that will not happen in my lifetime, but we will see.
As someone who is not a rail expert, I will ask the Minister two things. I do not understand why we do not have a regular electrification programme in this country for the whole of the rest of our network, because of both running cost—the cost of rails and the weight of the machines—and our carbon footprint. Why do we not just have the skills and ability to roll out electrification each year in a standard way that makes that work at minimum cost?
On signalling, I notice that there is one signalling exercise—on Newcastle metro—but a number of schemes are needed for signalling. I do not understand why, in these days of advanced technical expertise, AI and the rest, we do not just have in-cab signalling, rather than having to continually replace—very expensively—the physical signalling resources across our network.
Lord Hendy of Richmond Hill (Lab)
I am pleased that the noble Lord welcomes Wellington, Cullompton and Portishead. The answer with Tavistock is that there were so many schemes in what the previous Government promoted as Restoring Your Railway, which on the face of it looked to be an invitation to any community in the country to wish back the railway that was taken away 50, 60 or 70 years ago because, frankly, it did not have many people or goods using it. The answer to the noble Lord is for Tavistock and Plymouth to put forward a sound business case for that investment that would reflect the actual costs of building that railway. I have some experience of that scheme at a much earlier stage, when somebody rather optimistically claimed that it would cost £30 million to extend from Bere Alston to Tavistock. The reality is that it would be not reopening a railway but building a new one, and to do that you need very substantial economic activity there.
The regular electrification programme would of course reduce costs, but we have significant electrification going on in this country. The trans-Pennine upgrade is a very significant electrification project from York to Manchester, and that is in the course of delivery at the moment. When Mark Wild has sorted out HS2 in management and governance terms, as he will, it will be a very significant piece of electrification to be carried out by those people.
In the medium term, one of the answers is for us to have a strategy that embraces both rolling stock and electrification, because it is clear that modern technology allows battery trains and that battery trains could replace diesel trains on quite a lot of the network; they would not need total electrification, but they would need some wires. The noble Lord may have seen that the proposals for East West Rail do precisely that—there will be wires up where it is cheap and convenient to put them up to charge the train in order to charge the batteries for when it would need to go through other places.
The noble Lord raises an interesting point about signalling, but I think the noble Baroness, Lady Pidgeon, had it right about the European train control system on the south end of the east coast main line. We need to move away from like-for-like replacement of existing signalling. Still more difficult, the cost of those schemes means that, almost inevitably, while the aspiration to replace 1950s and 1960s signalling always starts with more flexibility and more capacity, that flexibility and capacity have always been deleted out of those schemes because they cost too much, and what you actually get is a like-for-like replacement at really quite significant cost.
The opportunity with the ETCS on the south end of the east coast main line is to embed a system that has in-cab signalling and does not require fixed assets on the railway but can run more trains on the same railway, because the trains are intelligent and know where each other are. The advantage of doing it on the south end of the east coast main line is that many classes of locomotive and multiple unit will be fitted with equipment, which will mean extending it. Therefore, using it to replace conventional resignalling will be far more possible in future than it is now. It is a thoroughly good thing, and the noble Lord is right that that is the way forward.
Viscount Stansgate (Lab)
My Lords, I welcome the Statement. Reference has been made to applications by open access operators. Will my noble friend the Minister take this opportunity to update the House on the Government’s current view of capacity and capacity constraints on the east coast and west coast main lines?
Lord Hendy of Richmond Hill (Lab)
I thank my noble friend for that question. The truth is that we knew at the time of the cancellation of HS2 phase 2a that the original purpose of a new railway, originally all the way to Manchester, was to enhance capacity. We knew at the time that phase 2a was cancelled that there were no alternatives and, therefore, that the railway would be constrained north of Birmingham, as it currently is. The Government are thinking about what might be done about that, but until HS2 is built to Birmingham, the Office of Rail and Road has told applicants for open access on the west coast main line that there is simply no space left—and there is no space left. The ORR has had to consider its duty to promote reliability on the railway and encourage Network Rail to improve reliability, and it would be pretty hard to do so if at the same time it approved applications that did not have appropriately guarded train paths to achieve it.
We will see what happens on the east coast main line, where several applications are currently being considered by the ORR as an independent adjudicator. The truth is that one reason for ETCS on the south end of the east coast main line is that the east coast main line is largely full too. I draw the House’s attention to earlier discussions that we have had about the new east coast main line timetable, which has been long in coming and in the end had to be decided by me as the Rail Minister because it was so difficult to get agreement between the parties that had train paths and rights to train paths in order to produce a satisfactory timetable. The truth is that my noble friend is right: on both main lines there is a shortage of capacity, the solution to which can be achieved only through further investment.
Lord Cryer (Lab)
My Lords, it is widely recognised that rail privatisation has been a spectacular disaster, which is possibly why around 80% of British people, according to most polls, support rail renationalisation—including millions of Conservative voters, who the noble Lord, Lord Moylan, clearly thinks are closet Marxists planning the state takeover of everything. I have my doubts.
My noble friend has touched repeatedly on the fundamental problem with the rail network—a lack of capacity, in which we have not seen any real expansion for decades. At the same time, road congestion is costing billions to the economy, not just in passengers but more in freight. If there was some movement from road to rail for freight, it would have an enormous economic impact. An average freight train can take around 70 to 80 HGV journeys away from the road network, easing that congestion. This document is a step in the right direction but, in the longer term, a major expansion of the rail network will serve the country well into the distant future.
Lord Hendy of Richmond Hill (Lab)
I thank my noble friend for those observations. He is right that the Government would encourage more freight on railways—there was a Question on that very subject at Oral Questions this afternoon—which is why they are committed to a long-term rail freight increase target. He will be pleased to know that rail freight grew by 5% last year. It is important when determining timetables for the railways to leave capacity in the right places and at the right times for freight traffic to increase while not constraining the desire to operate a better passenger service. That is one of the reasons why Great British Railways, when it is established, will have control of the timetable to make those best possible judgments, which are not currently made for the railway as a whole despite the fact that it is so obviously a whole network. That is why the public support the Government’s position on managing the railway as a whole network.