Railways Bill

Baroness Harding of Winscombe Excerpts

2nd reading
Tuesday 7th July 2026 Lords Chamber

[Baroness Harding of Winscombe (Con)]

My Lords, I also congratulate the noble Lord, Lord Wilson of Dinton, on his outstanding valedictory speech. Not for the first time in this Chamber, I am left humbled by his 60 years of service, and I am privileged to have listened to his wisdom and humour in his last speech. We will miss the noble Lord.

I am also humbled, as I am not an expert in the railways—I am afraid I did not even have a train set—and I was not expecting to speak in this debate, but what has brought me here is not the physical railways but the retail ticketing of our travel. Before I get to that, I should say that I am also not a huge fan of creating a single, large state-owned monopoly, and that I wholeheartedly endorse the remarks of my noble friends Lady May of Maidenhead, Lord Redwood and Lord Grayling. However, I do not know much about that topic; I would like to focus on what I do know about, which is retail ticketing.

Retail ticketing might seem small and insignificant if you like playing trains, but, as passengers, our ticketing services are our first contact with our train journey, and, sadly, because of Delay Repay, they are often our last contact. Retail ticketing matters to us as passengers. It shapes our confidence in our railway network and therefore drives or harms demand. It is an area where private sector competition has delivered substantial improvements for passengers over the last decade.

I have considerable experience of the value of competition in retail services, and of the dangers of a vertically integrated monopolist using its control of the end-to-end value chain to stifle competition at the retail end—that was called British Telecom and Openreach. I declare an interest in that I spent eight years battling them when I ran TalkTalk. We have also seen this in other travel markets, such as when Google launched its “flights” tab and, at one stroke, attempted to remove all competition in flight retail ticketing. None of this was good for consumers.

So, whatever your views on the value of state monopoly management of the physical network of the railways, I hope we can all agree that retail booking services do not need to be provided by a state monopoly. However, I am afraid there is a real risk that, as currently drafted, that is exactly what the Bill will do—not intentionally, but by mistake. We have one of the most dynamic retail rail markets in the world. Private sector investment in user-friendly apps, journey planners and real-time information over the past decade has been outstanding. This Government have recognised the significant value of the role that independent retailers play, because they help to innovate and drive-up standards for passengers.

In the other place, the Government relied heavily on a promised code of conduct to ensure that Great British Railways would not abuse its vertically integrated monopoly in ticketing. My experience in telecoms and digital markets is that a principle-based code of conduct or code of practice, without a clear enforcement regime and ex ante powers, will not deliver a competitive market. I am not alone in this—the CMA is very clear that this is a real risk. In April 2025, the CMA set out in writing its concerns that, as currently set out, the Bill could undermine incentives for third-party retailers to invest and compete. It said:

“the role envisaged for GBR as a ticket retailer gives rise to the risk (either actual or perceived) that GBR will self-preference its own retail operation, or otherwise have advantages over TPRs that are not based on merit (for example better access to relevant information). … It is therefore important to give the right signals from the outset that TPRs will be competing on a level playing field with GBR”.

I am afraid that the Bill does not give that reassurance from the outset.

International comparisons are very clear that integrated state monopolies will abuse this vertically integrated power. In both Germany and Spain, where there is no separation, the same basic approach to that proposed in this legislation has required competition authorities to intervene. Deutsche Bahn breached competition law because of restrictive marketing and pricing practices, and the Spanish monopolist had to agree specific behaviour changes with the European Commission because of competition concerns. By contrast, in France —I may get this all wrong, because I am not a rail person—SNCF Connect is a separate business. The ticketing business is completely separate, as it should be, to ensure that the vertically integrated monopolies cannot abuse their power.

Will the Minister confirm that all retailers will compete on equivalent economic terms and that GBR’s own retailer will not benefit from cross-subsidy? Without structural separation between GBR’s online retailer and the wider organisation, self-preferencing will be very difficult to detect, let alone remedy. Will the Minister confirm that GBR’s online retailer will be required to maintain separate governance and accounting arrangements so that the regulator has the transparency it needs to monitor and enforce compliance with its code of conduct?

Finally, will the ORR have ex ante powers under the code, rather than merely the ability to investigate after harm has already occurred—by which time the Government will have ensured that there is no investment from the private sector into this sector at all?

I know these are very detailed issues, and they might seem unimportant if you are more interested in the big physical infrastructure of the rail network, but ticketing experience to passengers really matters. Creating an unwieldy public sector monopolist in a service sector where competition is thriving would be a very big mistake.