Online Safety

Baroness Jones of Whitchurch Excerpts

Thursday 1st December 2016 Lords Chamber

[Baroness Jones of Whitchurch (Lab)]

My Lords, I am extremely grateful to the noble Baroness, Lady Howe, for tabling this debate today and I echo the comments of everyone in this debate in thanking her for her tireless work in championing the need for improved online safety for children. As various noble Lords have said, when the history is written, her name will be written there in lights, I am sure. I am also grateful that she has raised this important concern about whether our proposed UK age verification regime will fall foul of the EU net neutrality rules. I am hoping that the Minister will be able to add some certainty to what seems at the moment a rather murky area of law.

We would not be here today if there were not a sense of growing crisis about the damage caused by children viewing online pornography. I will not repeat everything said by the noble Baroness, Lady Howe, and others, but the full impact of online pornography on children’s attitudes to sex and relationships is becoming more and more apparent. We know that young people are accessing it at a younger age, many by accident, or because it is sent to them by social media. The NSPCC found that over half of young people between the ages of 11 and 18 had been exposed to online pornography, and nearly all of that group had seen it by the age of 14. The NSPCC also reported that the boys who had seen it felt that it was realistic and the girls who saw it felt pressured by the images they had seen.

There is now also evidence that children in primary schools are being exposed to this material. We have to accept that this is storing up trouble for the future and completely skewing young people’s healthy sexual development. Indeed, it was recently reported that 5,500 sexual offences in schools had been reported to the police and we can imagine that that is the tip of the iceberg and represents only the more serious offences.

Of course, this is why our party has argued consistently for compulsory, age-appropriate sex education in schools—a policy supported by over 70% of teachers, parents and governors and supported very widely in this Chamber. It is why we continue to be dismayed by the Government’s resistance to what seems to us to be an overwhelmingly sensible proposal. Nevertheless, we welcomed the moves by the Government in the Digital Economy Bill to strengthen the age verification process for accessing adult content online. We have supported the steps taken so far to introduce age verification for online content. We have supported the agreement with the British Board of Film Classification that it will become the regulator for online viewing. We accept that it has the knowledge and expertise to carry out this function effectively. However, we remain concerned that the scope of the Bill is limited and will not embrace all online pornography. We are even more concerned that the lack of clear enforcement powers will limit the Bill’s effectiveness. In essence we believe that having two regulators, the BBFC and Ofcom, risks further delays in requiring non-compliant providers to take down material in breach of the law.

This brings us back to the issue before us today, which is the enforceability of the measures in the Bill. The right reverend Prelate the Bishop of Chester said quite rightly that it is becoming a rather thick plot. This is because in parallel with the UK’s moves to strengthen child online protection, the EU has been moving in a rather different direction. Through its net neutrality regulations it has developed a set of EU-wide regulations to safeguard open internet access. On the face of it, the UK’s proposals for age-specific filters and controls on the internet are at odds with those EU regulations. This was flagged up by the then Minister, Ed Vaizey, when it first came before the Commons European Scrutiny Committee. At the time he said that further negotiations would need to take place, but that it might be necessary to vote against the EU proposals. However, as noble Lords know, the proposals were also wrapped up in a package to end mobile phone roaming charges, which of course was a very welcome development. As I understand the final outcome of the EU negotiations, the specific exemption of the UK’s child online protection regime was dropped, although the UK was given an extended deadline until this month, December 2016, to comply with the new EU regulations. Subsequent to that decision the then Prime Minister, David Cameron, was quoted as saying that an EU opt-out on the child protection issues had been secured, but that is not my reading of the proceedings at the EU level. I would therefore be grateful if the Minister could clarify the status of that decision once and for all.

Since that time, the Digital Economy Bill has been published and debated in the Commons. The Bill included proposals for the regulator to direct internet service providers to block any site that does not have age verification in place. In the Committee debate in the Commons the Minister, Matt Hancock, claimed that Clause 8 reinforced the protection of parental filters where they can be turned off by the end user, which was allowed under the net neutrality rules. However, as we have heard, at the Report stage of the Bill on Monday this week, the Government tabled a significant number of amendments to the age verification process. We are still working through all the implications of those amendments. But the Minister, Matt Hancock, specifically announced that further amendments will be tabled here in the Lords to put the net neutrality issue beyond doubt and to confirm that providers can offer parental control filters.

In the light of the continuing uncertainty, can the Minister clarify what legal advice has been received on whether the new proposals comply with the net neutrality regulations? Can she assure us that any proposals will address the unintended or potentially unintended consequences related to out-of-home use, such as in wi-fi hotspots where it would not be possible for age verification filters to be turned off? Can she also clarify how this obligation on ISPs will apply to websites originating in the rest of the EU which are covered by a different interpretation of the net neutrality rules? Finally, given the new powers that have been passed to the BBFC, can she clarify whether Ofcom or the BBFC will now have the responsibility for checking compliance with the new EU regulations?

I realise that the Minister has been working on this issue for some time, and I also realise that it has been moving apace since the Digital Economy Bill was published. However, I am sure that she realises the sensitivity of this subject and the concern of many campaigners about the need for improved child protection on this important issue. I hope that she will be able to use this opportunity to clarify the legal situation and put parental minds at rest in advance of the more detailed deliberation on the Bill.

Bus Services Bill [HL]

Baroness Jones of Whitchurch Excerpts

Monday 4th July 2016 Lords Chamber

Moved by

[Baroness Jones of Whitchurch]

21: Clause 4, page 14, leave out lines 36 and 37

[Baroness Jones of Whitchurch (Lab)]

My Lords, our Amendments 21, 38, 39 and 40 go to the heart of the concerns that we raised at Second Reading about the restrictions on local authorities being able to access the new franchising model set out in the Bill. As it stands, a mayoral combined authority can automatically opt for a franchise scheme if it feels that it is right for its locality. However, all other categories of single or combined authorities must first seek the permission of the Secretary of State. Their decision would then need to be endorsed by affirmative regulation. Our amendments simplify and streamline that process, taking the Secretary of State out of the equation and creating a level playing field for local authorities.

We share a common purpose in wanting to improve the number of passenger journeys and drive up standards. We know that the franchising model works; the statistics for bus use in London are testament to that. No doubt this is part of the reason that the Government have finally embraced it as appropriate for mayoral authorities. However, no one has satisfactorily explained why, if it is good for one model of local authority leadership, it should not work equally well in other areas. It is not at all clear what the unique wisdom of mayoral authorities is. As I said at Second Reading, there is a wider game of politics going on here. Clearly, the Government are scratching around to find incentives for local authorities to adopt their preferred model of local leadership. This has been alighted upon as a bargaining chip; it has nothing to do with improving bus provision.

The threat of Secretary of State interference in local authority decisions, as set out in this Bill, surely runs counter to the shared aspiration of both the Government and the Opposition to devolve more power to localities and let local communities shape the services that are right for them. Our view is shared by the Local Government Association, which has endorsed our amendments. It takes the view that all areas should be given automatic rights to bus franchising powers, with the decision taken locally, based on robust evidence and taking into account the needs of passengers, local residents and other circumstances such as the performance of local bus markets. Its view is shared by many other smaller bus operators. For example, Dai Powell, the chief executive of HCT, which provides more than 20 million passenger journeys a year said:

“The power for Local Authorities to franchise their local bus services has the ability to revolutionise the UK bus industry. It’s pretty clear that franchising has the capability to bring significant benefits to the travelling public through enabling network development that meets the needs of communities”.

The only group that seems to be lukewarm about the franchising model and our proposals to streamline and extend the model are the existing local large bus operators. However—being realistic—they would say that, wouldn’t they? The existing arrangements have, of course, served them well. They may result in a poorer bus service, but they have also delivered large profits for them. A recent Competition Commission investigation concluded that bus operator profits are higher than in any other business sector deploying comparable levels of capital at equivalent risk. Across Britain, bus companies’ average operating profit in the 10 years to 2013 was £297 million a year. Bus companies in the unregulated big cities made average profits of 8%, whereas profits in London are less than 4%. So we can see why they may be reluctant to embrace change and support the franchising model. However, we do not accept that position. It cannot be right that around 10% of public money going into bus subsidies is ending up being paid out in profit dividends rather than improving the local bus service. Our amendments would make it clearer for local authorities as a whole to do what is in the best interests of their local community, without bureaucratic, costly and lengthy interference from the Minister.

Meanwhile, as the noble Lord the Minister has been made aware, the Delegated Powers and Regulatory Reform Committee has also raised its own concerns about this clause. It has flagged up the inadequate explanation in the Explanatory Notes as to why different rules are being applied to mayoral and non-mayoral authorities. It says:

“We have therefore found it difficult to assess, on the basis of the explanation in the memorandum, whether it is appropriate to delegate to the Secretary of State a power to allow the authorities referred to in section 123A(4)(b) to (f) to become franchising authorities, instead of this arising immediately upon the commencement of clause 4. The House may therefore wish to ask the Minister to provide a fuller rationale for the power in new section 123A(4)”.

I think that we would all like to have an explanation for the Government’s discrimination against the non-mayoral authorities in the Bill. The noble Lord has said that he intends to respond to that committee. We would all be interested in that response, so perhaps the noble Lord can let the Committee know when it will be available. In the meantime, regardless of that, we believe that these amendments are crucial to making the Bill a success. I beg to move.

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[Lord Snape (Lab)]

My Lords, I am not getting involved in the squabble between noble Lords opposite, because I want to start one of my own, on this side. The fact is that I have never been in favour of franchising and I do not think that the proposals for franchising in the Bill are particularly sensible either.

I listened with interest to the view of the noble Lord, Lord True. I know that he is enormously talented, but I am not sure that he is qualified to run a bus company—although, obviously, as the leader of a council, he feels that he should. I share his view that elected mayors are not capable of running bus companies either, but we all know why they are being given that responsibility. Having created these large authorities against the wishes of the electors in cities such as Birmingham and Manchester, they have to give them something to do—and I am sure that letting them run the buses seemed to the Treasury to have been a good idea at the time.

I have asked Ministers about this and, indeed, the Minister here today indicated that the extra money needed to run those bus services in our large cities will be provided by the Treasury. That is not normally the way that the Treasury goes about things and it seems to me that these responsibilities are being passed on to big-city level without the resources to deliver them adequately.

Again, I have to say to my noble friend on the Front Bench that I do not share her view of the bus industry as it used to be. It is a bit like British Rail: everybody tells me how wonderful it was. Actually, I used to work for it and I did not think that it was particularly wonderful at the time. Now it is implied that the bus industry, when it was under municipal control, was a picture of tranquil harmony, with lots of satisfied passengers. I have bored your Lordships before with my own career, such as it was, in the bus industry, but, when I worked for Travel West Midlands, it was a group of municipal undertakings that were put together as a result of the 1968 Act, semi-privatised by the Conservative Government of the 1980s and actually acquired by its employees.

When I became a director of the company I did not think for a moment that it was due to my talent: I was told afterwards that I was the one person who both management and staff could agree on at the time. I am not sure whether that was praise or condemnation, but I became a director of the company in 1992. Many of its buses were quite ancient. The average age of the bus fleet of Travel West Midlands in 1992 was nine and a half years. After we, the employees, voted in 1997 to join the National Express Group, the age of the bus fleet when I stepped down as chairman in 2000 was just over six years. That was a quite dramatic reduction and indicates the amount of investment that was put into new vehicles during that period.

If bus services are franchised, what will happen to that investment? I have to say to my noble friend that, because we were a subsidiary of the National Express Group, it was my job and the job of the other directors to make a case for investment to the main board. We actually invested around £30 million during the time I was directly involved, in tranches of around £10 million each time. We had to convince the board of the National Express Group that it was sensible to invest that sort of money in bus services in Birmingham.

Does my noble friend think for a moment we would have got the go-ahead from the National Express Group if the idea of franchising was being held over the company’s head at that time? I will answer my own question: the fact is that we would not have got the go-ahead, because the view of the National Express board would have been, “We are not prepared to spend £10 million of our assets on buses when someone else—whether it is the noble Lord, Lord True, or someone else—will tell us where to run them, when to run them and how much to charge”.

Again, reverting to those so-called halcyon days of municipal control, my noble friend talked about the amount of profit that was made by the five major bus operators. As I have indicated, many of them operate new fleets. As far as wages are concerned, I will confine my remarks to Travel West Midlands, where I was chairman of the board. We paid our drivers the best rates in the United Kingdom, so those profits were not made off the sweat of the brow of our employees, although of course some went to shareholders. I know that we have some disagreements at the moment about the leadership of my party, to say the least, but I do not think that we are entirely anti-profit-making yet. We will have to see what happens in the next few days and weeks, but I do not think we object to companies paying their shareholders a dividend and paying their staff an adequate wage.

[Baroness Jones of Whitchurch]

I have been listening to my noble friend’s rant, and I have to say that he is completely misrepresenting the point that I was making. I am not advocating a return to the old days, and he is rehearsing the history of things that were probably before my time. First, municipal services, as it happens, now have some of the highest satisfaction levels, so I am not saying that there is anything wrong with municipal services. That is a debate for another day, and we will return to it. Secondly, we are here today because, having allowed the free market that he is advocating to thrive, passenger numbers and satisfaction levels are going down. That is why the Government brought this Bill forward in the first place. To be absolutely honest, I am not sure that my noble friend has addressed that. We are considering options such as franchising because it is considered that it will drive standards up again, which is what we all need.

[Lord Snape]

Passenger numbers are indeed going down—they are going down in London, as a matter of fact—as is passenger satisfaction. I do wish that my noble friend, instead of relying entirely on the Local Government Association and what used to be called the Passenger Transport Executive Group, would actually look at the facts. Passenger satisfaction in London, according to the most accurate survey, by Passenger Focus, is currently less than that in Birmingham, for example. Passenger numbers are also going down in London, and they are going down for one simple reason: it is nothing to do with franchising, private ownership or whatever but because of congestion. We all know how bad congestion is in London, and it is getting worse, which is impacting on passenger carryings at present.

I have been trying to find out how many staff are employed in Transport for London exclusively on franchising matters. I am told that it is some hundreds, but I cannot get anything more accurate than that. This is not going to be a cheap operation if the noble Lord, Lord True, and his colleagues are going to run the buses in his part of the world. Despite his talent, he is not going to do it on his own; presumably there will be a director of franchising, perhaps a couple of assistant directors and other staff. Lots of money that perhaps could and should be spent on improving bus services will be spent on the bureaucracy that is necessary—I am not complaining; it is a fact—to run a franchising operation. I have to say to my noble friend that it is not just in London where the operation is run like that; Belfast has a franchising system, and, of course, due to congestion in Belfast, passenger carryings are falling there too.

If my noble friend had stood at that Dispatch Box and advocated the rest of the London experience such as sensible traffic control, the proper maintenance and policing of bus lanes, and perhaps even a congestion charge—or car park charges, as introduced in Nottingham—there would be some sense in that, but we are getting none of that. We are told that if we go to franchising, somehow the situation for the bus passenger, who rarely gets a mention when we discuss these matters, will magically improve. I do not believe a word of it.

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[Lord Ahmad of Wimbledon]

Perhaps I may respond to that. As I am sure the noble Lord appreciates, every devolution deal involves detailed discussions between the Government and those proposing the deal. No doubt if a particular area, wherever it may be, wishes to go down that route, it would be subject to discussions around the devolution deal.

[Baroness Jones of Whitchurch]

I thank the Minister for his response and I thank noble Lords around the Chamber for their support, particularly that of the noble Lords, Lord True and Lord Horam, which I welcome. The noble Lord, Lord True, has done half of my summing up of the debate for me which I would otherwise have done. I want to look carefully at the Hansard report of this debate because I am still not clear about what is so special about mayors. I was really hoping that the Minister would explain what is so unique about that particular model. My noble friend Lord Woolmer made the point that you could have two adjoining authorities with the same geography, the same population and income, but one of them would have a fast track to automatic franchising purely because of the fact that it has a mayoral system rather than another one while the other would have to go through a very convoluted process.

I do not understand what it is about the mayoral model that is so important. It is not just about the geography and economics or even the strategic role, as the Minister has suggested; there is something much more singular about a particular local government structure. The fact is that we trust local authorities with making very serious decisions already. We entrust social services issues to them where they make life-or-death decisions about child protection. We trust them to take serious decisions in the commissioning of all sorts of services. It is not as if they do not already commission services and of course they have the expertise to do so. Running a bus service does not require particularly special skills which authorities do not already have. Some might not choose a franchising model, which is perfectly understandable, while others may want to have it. I do not quite understand what is so special about having a mayor in charge that would qualify them in this way.

[Lord Snape]

My noble friend mentioned the special skills of local authorities, which certainly exist. But, with respect, they do not have any franchising skills because that is not the way we operate bus services at present. Does she agree that setting up franchising in a big-city area would be an expensive and bureaucratic process? I have no idea how many people it would take, but it could not be done by one person or even a small department, could it?

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[Baroness Jones of Whitchurch]

Of course, the provisions in the Bill allow for all that, and that is one factor that needs to be taken into account. But the local authority would not do it unless it thought that the outcome would be better than the current provision. If the authority did a cost-benefit analysis and decided that the cost outweighed the benefits, it simply would not do it. All that we are asking for is for authorities to have the flexibility to do that analysis and then decide whether it is in their interest to go ahead.

Another thing that I was going to pick up on was what the noble Lord said about providing certainty to the bus operators. Franchising also provides some certainty; the operators’ profits may not be as high but they would certainly have a guaranteed long-term contract. That outweighs the higher-risk, more market-driven decisions that the operators would otherwise take.

I think that everyone in the Committee knows that the Minister cannot make a decision on this today. We have all talked about the current political uncertainty. We all know where this is coming from and I do not expect for one minute that the noble Lord will say today that he will overturn the decisions of the higher authorities in the Conservative Party on this. But perhaps at some point before Report he could take back a message to whoever is calling the shots and say that there is a strong feeling in the Committee on this and that there should be an opportunity for a rethink. On that basis, I do not wish to say any more and I beg leave to withdraw the amendment.

Amendment 21 withdrawn.

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[Lord Snape]

I am grateful to my noble friend for that definition of his view. However, that view would pertain only between reasonable people. We have to bear in mind that not all people—some of them elected—are necessarily reasonable.

In Tyne and Wear, for example, the passenger transport authority went to court to try to get what was called a quality contract under the previous legislation. A considerable amount of public money was spent, and eventually the people appointed to rule on these matters said that the existing service should be continued and denied the PTA the right to a quality contract. As I said, Tyne and Wear PTA went to court, and spent a considerable amount of public money, despite satisfaction ratings of more than 80% with the current services, as set out by Passenger Focus, of thousands of bus passengers countrywide, including in the north-east. We are not dealing entirely with completely reasonable people. I hope that I can convince my noble friend. I repeat that the temptation for any democratic body when being offered extra powers is not to turn them down.

The amendments are designed to ensure that the question of a franchising agreement is a last resort rather than a first one. The consequential amendments follow on from that. I hope that the Minister will feel that they are both sensible and reasonable and will be inclined to accept them. I beg to move.

[Baroness Jones of Whitchurch]

My Lords, I will be brief. I have listened carefully to the contribution of my noble friend. As he indicated, he is making these proposals in the context of being against franchising. On that basis, we are not convinced that these amendments are necessary.

As it stands, the Bill requires those considering a franchise scheme to prepare an assessment that considers the merits of franchising weighed against other options. My noble friend is suggesting that they would just steam ahead regardless, but the checks and balances in the Bill make that unlikely and, indeed, impossible. We would expect there to be a detailed, thoughtful piece of work by the local authority that genuinely balances the different options in the context of what is in the best interest of the local community.

As it stands, the Bill requires the assessment to consider affordability, value for money and how it would apply to wider authority policies. We believe that that is the right tone to adopt when making an assessment. My noble friend’s proposals would go further than that and require greater certainty that all the conditions are met at that stage. We believe that that would go too far and discourage authorities from going through that appraisal and assessment process before making any decisions, which is the important point.

Therefore, we believe that the checks and balances in the Bill are the right way to go forward. There are many stages in the assessment process that would allow the proposal to be fully scrutinised, including a full audit, which we are going to talk about later. We want authorities to consider all that in an open and thoughtful way and go through what is in the best interests of the locality, taking into account all the factors and complexities of moving to a franchise situation, which my noble friend has identified—but it must be done in a balanced way. We believe that the provisions in the Bill should be supported.

[Lord Ahmad of Wimbledon]

My Lords, I thank the noble Lord for tabling his amendment. He proposes a series of amendments that would change the nature of the assessment that franchising authorities must prepare for their proposed franchising scheme before determining whether to introduce franchising.

In thanking the noble Lord, let me assure him that we recognise the importance of ensuring that decisions to move to a model of franchising are taken on the back of a robust assessment. In developing the Bill we have been keen to move away from the processes set out in the Transport Act 2000 that must be followed before a quality contract scheme can be established. That legislation required authorities to be satisfied that a number of tests had been met before introducing such a scheme. As was touched on at Second Reading, only one authority ever attempted to use the quality contract scheme legislation to introduce a quality contract scheme. In part I think this was because the “must pass” tests proved to be too restrictive.

I agree entirely with the noble Lord that authorities looking to franchise must consider whether the scheme is affordable, represents value for money and contributes to the implementation of relevant policies. But I think that devolved decision-making must be respected, with the mayor or authority considering the issues listed in Section 123B and any other relevant issues when assessing their scheme, and then taking reasonable decisions with their eyes wide open. I do not want to repeat the failings of the quality contract scheme legislation, and I want to ensure that franchising is a realistic option where it makes sense locally. I am concerned that the amendments as proposed would unnecessarily restrict mayors and authorities by requiring them to be satisfied about a number of issues, rather than requiring them to set out their thinking and rationale. I agree entirely, though, that I would expect authorities to proceed with franchising only where there is a strong case to do so. However, I do not want to rule out, for example, an authority proceeding with franchising where a scheme contributes hugely to its transport policies but not necessarily to its other published policies affecting local services.

The noble Lord raised a specific issue about operators having assets such as bus garages being taken away or awarded to winning bidders. It is important to note that the Bill does not give authorities powers to acquire bus operators’ assets. Authorities could potentially come to agreements with operators or lease new depots or garages to those winning businesses.

I trust that this short debate has helped to assure the noble Lord that the Bill as drafted will ensure that authorities consider a number of specific factors in their assessment of whether to move to a franchising model and allow decisions to be taken in the light of local circumstances. I hope that the noble Lord is reassured to the extent that he feels able to withdraw his amendment.

Bus Services Bill [HL]

Baroness Jones of Whitchurch Excerpts

Monday 4th July 2016 Lords Chamber

[Lord Berkeley]

My Lords, on the amendments that we have discussed in Committee, many noble Lords have said how important it is for devolution to happen and for local authorities around the country to be able to operate franchises without too many controls from central government. Whether that happens or not, the importance of independence in the audit is vital, as other noble Lords have said. It would be so easy for some local authorities in the future to get it wrong and then for a rather nasty article to appear in Private Eye, suggesting that the leader’s brother-in-law was the auditor. I am sure that would never happen, but we do need independent checks. My noble friend Lord Snape’s suggestion of traffic commissioners appointing the auditor has enormous merit. The two issues in Amendment 42 in the name of the noble Lord, Lord Bradley, and myself, about the affordability of the scheme and whether it represents value for money, are the two most important ones that should be focused on by the auditor. Then we would all feel comfortable that it would probably work very well.

[Baroness Jones of Whitchurch]

My Lords, we very much support the intent of the first amendment introduced by the noble Baroness, Lady Scott, and of Amendment 42, which was introduced by my noble friend Lord Bradley. It is important that the audit process is properly independent and provides a trustworthy external scrutiny—that makes perfect sense. It also makes perfect sense to ensure that the proposals are properly costed and that we can have confidence that they are affordable.

However, regrettably, we do not feel able to support the amendment of my noble friend Lord Snape—we seem to be making a habit of that. We believe that his amendment is too specific and restraining and we hope that, on reflection, he will feel able to support Amendments 41 and 42, which we believe would achieve the additional reassurance he seeks and ensure that a fair, independent assessment process takes place. I hope that my noble friend will reconsider and that the Minister will feel able to support the first two amendments.

[Lord Snape]

Before my noble friend sits down—I am sorry that she finds herself unable to support what is, in my view, a well-intentioned and well-meaning amendment—perhaps she can tell us why she objects to the traffic commissioner and why that is too specific. After all, by the very nature of his or her job, the traffic commissioner knows the business inside out and is widely trusted by all sides in the industry. Surely to have someone like that appointing an auditor is a very sensible way forward.

[Lord Snape]

And he is independent, too.

[Baroness Jones of Whitchurch]

Without wishing to get into a dialogue, I think that we felt that as long the role was prescribed to be independent, different authorities will have different arrangements for appointing independent auditors. We do not feel that we need to be that prescriptive in this piece of legislation. I would not go any further than that.

[Lord Ahmad of Wimbledon]

My Lords, there are a number of amendments in this group, all related to the audit function required as part of the franchising provisions. The noble Baroness, Lady Scott, proposes an amendment to state explicitly that the auditor, whose role is to issue a report to the franchising authority on certain aspects of the assessment of the proposed franchising scheme, must be independent. The noble Lord, Lord Snape, proposes an amendment that would require the auditor to be appointed by a traffic commissioner. The noble Lord, Lord Bradley, proposes an amendment that would require the auditor to consider matters relating to an authority’s consideration of affordability and value for money. I thank all noble Lords for their amendments, and will turn to each one.

Before I go into those details, the noble Baroness rightly talked about the Public Accounts Committee’s report on local scrutiny, and I thank her for bringing that to the Committee’s deliberations. We are of course ensuring that we consider its recommendations very carefully as the Bill moves through Parliament, and we will respond during the course of the Bill.

Turning to the amendments, I recognise the importance of ensuring that decisions to move to a model of franchising are taken on the back of quality information and robust analysis. As I have explained previously, in developing this Bill we have been keen to move away from the quality contract scheme processes set out in the Transport Act 2000, which, in particular, included the need for independent scrutiny by a “Quality Contract Scheme Board”. While I agree entirely that there is a need for a level of independent assurance, I do not think that devolved decisions should be second-guessed by an independent panel. We introduced the role of the auditor to ensure that an independent third party provides assurance that certain information used in the assessment is of sufficient quality, that the analysis of that information is robust and that relevant guidance has been followed. It is not the auditor’s role to take a view on the decisions taken by the franchising authority. As I am sure that noble Lords agree, its role is to provide a quality check.

The Bill requires any auditor to have a “recognised professional qualification” and to be eligible to act as the local auditor of the authority’s accounts. As such, we would expect any auditor to be suitably qualified and able to provide independent assurance.

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I will raise one other issue, which relates to the wording of the Bill. There are a number of instances where the Bill refers to “small and medium-sized” bus operators. Is that defined in the same way as “SME”, which is recognised economic terminology? Also, what is a small and medium-sized operator? For example, Go-Ahead, one of the big five transport operators, actually has a very small share of the market in Cornwall. Go-Ahead is clearly not an SME but, in that instance, could be said to be a small operator in Cornwall. I apologise if this question comes a bit out of left field and would be happy for the Minister to write to me clarifying the position if he is unable to deal with it immediately this evening.

[Baroness Jones of Whitchurch]

My Lords, I will speak to Amendments 48 and 51 in my name. I very much support the amendment tabled by my noble friend Lord Whitty. Amendment 48 takes a similar position—that as part of the consultation process, passenger organisations and trade union and employee organisations must be involved. We believe that proper time should be allocated to make this a meaningful consultation and an effort made to explain the changes in a clear and accessible form to those who may be affected. As my noble friend said, we have debated these issues in relation to previous amendments and received a positive response from the Minister. I hope a similar response will be forthcoming today.

I hope that Amendment 51 is an area where the noble Earl, Lord Attlee, and I are able to agree for once; I am pleased that some commonality is coming out of this debate. One of the problems with bus provision in this country is that the market is dominated by a small number of large bus operators. This makes the procurement process more difficult for local authorities and does not always result in the best passenger experience. It is difficult for new entrants to enter the sector, even though they often provide more responsive, quality services with high customer satisfaction. Reference has previously been made to the social enterprise company HCT, which runs highly successful services in parts of London, Yorkshire and Bristol. It also has the contract for providing bus services in Jersey. Since it took over that service, passenger usage has increased by 32%, the level of subsidy has reduced by £800,000 a year and customer satisfaction has increased by 5%. Somewhat uniquely, the contract also has a profit-sharing element and it is now giving money back to the local authority.

We need opportunities for innovative providers like HCT to enter the market and win new contracts, but the rules are stacked against them and the regulatory burden is far too onerous for the small providers to navigate. There is a danger that the proposals in the Bill will entrench local monopolies, at best replacing an unresponsive private sector monopoly with a publicly commissioned one. When it comes to enhanced partnerships, we need to be clearer about the process for opening up partnership lists to competition to allow new entrants to join. As it stands, the Bill acknowledges this problem in new Section 123F (1)(i). It requires the consultation document for authorities going down the franchising route to include a statement on how they propose to facilitate the involvement of small and medium-sized operators. We obviously welcome that.

Our amendment takes this one step further and requires the consultation document to consider how the franchise could be divided into smaller units. This would help to break down the local monopolies and encourage new entrants into the market. I hope the Minister understands and shares these objectives: I look forward to hearing his response.

[Lord Ahmad of Wimbledon]

My Lords, this group contains a number of amendments to the consultation process that a franchising authority must complete before it can implement a franchising scheme. Before going any further, my noble friend Lord Attlee asked about “small and medium-sized operators” and whether in the context of the Bill that meant small and medium-sized companies. The short answer is yes. It is judged by the size of the company rather than the nature of its operation. In the interests of clarity, which is always important, I will write to him formally in that respect.

Turning to the amendments which relate to the persons or bodies to be consulted and the form the consultation should take, Amendment 44, in the name of the noble Lord, Lord Whitty, would require franchising authorities to consult Transport Focus when consulting on their proposed franchising schemes. Once again, I am delighted to say that I agree with the noble Lord that it is important that organisations that represent passenger needs have an opportunity to respond to a consultation on a proposed franchising scheme. Transport Focus already works closely with local authorities and bus operators with a view to securing improvements to bus services for passengers, and I will consider how best to ensure that the Bill gives Transport Focus an opportunity to express views on franchising scheme proposals. I hope that this provides assurance to the noble Lord, Lord Whitty, in that respect.

Amendment 45, in the name of the noble Baroness, Lady Scott, would require franchising authorities to consult the Competition and Markets Authority on their proposed franchising schemes. As I said at Second Reading, competition does not disappear when franchising is introduced; it merely moves from “on the road”, where bus operators compete at bus stops for passengers, to “off the road”, where bus operators compete for contracts to operate services. Franchising authorities will be able to design a franchising system which suits their local area and local needs, whether that be through gross-cost or net-cost contracts, or with large or small bundles of routes, bearing in mind the need to involve small and medium-sized bus operators.

However, I agree that any fundamental change to the bus market that is being considered by a local area should take account of the potential effects on competition and the benefits or impacts this could have for bus operators and local people. I further agree that it may be helpful for franchising authorities to work with the Competition and Markets Authority as they develop their proposals, and for the authority to be consulted. I hope I have reassured the noble Baroness that I am with her in ensuring that we look at how to fit that into the Bill.

Amendment 48, in the name of the noble Baroness, Lady Jones, would add some additional requirements to the consultation provisions in relation to franchising, including requiring passenger interest groups to be consulted on franchising proposals. I thank the noble Baroness for her amendment, and agree that it is vital that passenger groups and others that may be affected are consulted fully on proposals to improve local bus services. I recognise that many noble Lords spoke about passenger representation and accessibility of bus services at Second Reading and in earlier Committee debates, and I fully understand that there is a wide spectrum of views and needs to be considered when planning local bus services.

The franchising provisions already include requirements for the authority to consult organisations that represent users of local bus services. Therefore, I encourage any authorities thinking of using the new tools in the Bill to engage fully with interested parties as proposals are developed. I hope this goes some way to addressing the noble Baroness’s concerns about the interests of passenger groups and reassures her that the Bill requires authorities to consult fully with those groups on franchising proposals.

Turning to the form that consultations on franchising and enhanced partnership proposals should take, the noble Baroness, Lady Jones, raised an important issue about accessibility and the need for consultations to be conducted in a manner and over a time period that is accessible to all. I agree that any consultation must give local people due time to consider and respond, particularly as proposals about local bus services are likely to have a large impact on local communities. I will therefore give further consideration to how best to ensure that consultation exercises relating to franchising proposals are accessible to all.

Turning to the amendments on the consultation materials that franchising authorities must prepare, Amendment 51, in the name of the noble Lord, Lord Kennedy, would reinforce the need for authorities considering franchising to give due consideration to small and medium-sized operators, given the important role they play in the delivery of local bus services. I sympathise with the aims of the amendment and I think we can all agree that small and medium-sized bus operators across the country deliver vital services to our local communities. Many of these smaller operators deliver tailored and bespoke services to suit local needs, and we want to see these small businesses continue to thrive, regardless of the model of bus service delivery that is employed.

The Bill requires franchising authorities, both as part of their consultation exercise and in issuing their response to that consultation, to set out how, in conducting the procurement process, they intend to facilitate the involvement of small and medium-sized operators in the provision of local bus services once franchising has been introduced. I agree entirely with the principle in the amendment that in reality, this provision will require the authority to consider in practical terms how it intends to facilitate the involvement of small and medium-sized operators, which may well include the division of local service contracts into smaller lots. However, there may be other ways to achieve that aim—for example, through subcontracting—and I do not want to prejudge the procurement strategy that an authority may employ. I hope I have reassured noble Lords that the Government are committed to ensuring that small and medium-sized operators continue to have a place in the market regardless of the model of delivery, and that the provisions in the Bill already address this issue.

Amendment 52, in the name of the noble Baroness, Lady Scott, would require franchising authorities to include in their consultation document their assessment of their proposed franchising scheme, conducted under new Section 123B, rather than a summary of their assessment. I hope I can reassure the noble Baroness that franchising authorities are already required to publish their assessment of their proposed scheme. The Bill also requires that a summary of the assessment of the proposed franchising scheme should be included in the consultation document itself, with the aim of ensuring that the consultation document contains sufficient information for the lay person to consider, without necessarily having to refer to the full assessment. I hope the noble Baroness agrees that these proposals are sensible and that the Bill as drafted already achieves her aims.

Amendment 53 would require franchising authorities to publish all the responses to their consultation on their proposed franchising scheme. I agree that it is important for those reading the response to the consultation to be informed of the views that have been expressed in responses to that consultation. I fully expect any authority to set out in its response to the consultation the views expressed by those consulted, subject to any disclosure issues, and the authority’s response to those views.

However, I do not want to be too prescriptive about how the authority should respond to the consultation and the exact form the response should take. For example, the authority may receive many responses on the same issue and may choose to summarise those responses and list the number of responses received. Again, that is common practice in local government. But I will consider how best to ensure that franchising authorities set out a summary of the responses they receive to their consultation, and hope that I have reassured the noble Baroness in this respect.

Government Amendment 50 removes the requirement for the franchising consultation document to include a description of how it is proposed persons are to be invited to tender for the provision of services. The Government believe that it is proper to remove this reference as the Bill does not make provisions anywhere else as to how the procurement process will work. This will be a decision of the authorities involved, in the context of procurement law, and guidance will be provided on procurement approaches.

Finally, Amendment 49, also in the name of the noble Baroness, Lady Scott, would require franchising authorities to have an auditor reassess their proposed franchising scheme if it is modified following consultation. I sympathise with the aims of this amendment, and agree it is vital that franchising authorities have the assurance of an auditor in relation to certain aspects of their assessment. We have already spoken about the audit function at length today so I do not want to go into further detail. I have agreed to sit down with noble Lords to discuss this further.

The section of the Bill to which the noble Baroness refers ensures that authorities are able to take account of the views expressed in the consultation and modify their franchising scheme appropriately. I also expect authorities to use their good sense and judgment. If the consultation unearths new data or causes the authority to radically rethink its approach, then of course I would expect the authority to take a view on whether it should choose to seek the auditor’s opinion on the new data or the revised analysis, and whether it should consult again on the revised scheme. I do not, however, want to force authorities to go through these processes again when a franchising scheme is modified. It may be that an authority makes a small tweak to its proposed scheme which does not materially affect it, when it would seem unreasonable for the authority to have another assessment by the auditor.

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Moved by

[Baroness Jones of Whitchurch]

58A: Clause 4, page 19, line 40, at end insert—
“(8) The scheme must specify whether consideration has been given to the wider social, economic and environmental benefits of the scheme, in accordance with the Public Services (Social Value) Act 2012.”

[Baroness Jones of Whitchurch]

My Lords, Amendments 58A and 99ZA call upon commissioners of bus services under franchise, and those developing enhanced partnership schemes, to apply the principles of the social value Act 2012 in specifying the service required.

The social value Act, brought in by this Government, recognises that many public services can have a wider role than a simple cost-benefit analysis would identify. It requires those procuring services to consider the economic, social and environmental benefits of each bid. It allows local authorities to think about public services in a more coherent way with wider benefits and encourages those bidding for contracts to be more imaginative about the community benefits their service could bring. Often this can result in better-designed services, with other benefits and efficiencies.

In the case of bus services, it could include, for example, a commitment to train and employ a number of long-term unemployed people to work on a contract. It could include a number of apprenticeships and work experience places for young people. It could include a commitment to support an existing community bus service—perhaps with some shared facilities. It could include an environmental plan with targets for green energy and reduced CO₂.

These are just examples, but the point of social value is to encourage providers to commit to their own added-value measures without costing any more money. It is essentially supplier neutral, in that it can apply to all operators, whether commercial, social enterprise or municipal. It allows local authorities to be as specific as they choose—either specifying the expected wider benefits at the outset of the bidding scheme or encouraging bids to offer up more creative service solutions at a later stage of the process.

Implementing the social value Act would appear to be an excellent tool for achieving many of the community benefits which we have been seeking in other amendments to the Bill so far. I am sure the Minister is aware that the operation of the social value Act was reviewed last year by the noble Lord, Lord Young. He concluded that, where it was used effectively, it resulted in commissioners being much more innovative and delivering much more responsive public services. However, the noble Lord also concluded that the opportunities and advantages were simply not widely enough understood and therefore take-up of the model was low.

This is the Minister’s opportunity to put this matter right by embracing this model as it applies to bus services in the future and putting social value at the heart of the Bill. I beg to move.

[Baroness Scott of Needham Market]

My Lords, I am very pleased to see that the noble Baroness has tabled this amendment. I raised the question of the social value Act in a group of amendments when the Committee met last week. In doing so, I was trying to get at the point that the noble Baroness has made, which is really about extending the ambition of the Bill in terms of understanding the broader context, whether it is environmental or social. Because the inspiration of using the social value Act only came to me very late in the day, when it was too late to table an amendment, I raised it in debate rather than tabling an amendment. I am pleased to see that the noble Baroness has rather more ingenuity than I have and has found another place in which to put it.

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[Lord Ahmad of Wimbledon]

As I have reflected on before, while we are in the holy month of Ramadan, noble Lords should be thankful that they are not getting emails from me because they would be arriving at about 3 am. If I am writing them, I hope noble Lords are reading them. I will of course confirm when the guidance is due to be published, but I hope I have provided clarity and that the noble Baroness will withdraw her amendment.

[Baroness Jones of Whitchurch]

I think the Minister for his response and I thank all noble Lords who contributed. For a little while there, we had a sense of what is possible in the Bill. If we were not careful, we were going to get bogged down in the technical detail of franchising but, as my noble friend Lord Judd said, it is about building community and using the real advantages that you get with a Bill like this that comes along only once every 20 or 30 years. This is a chance to build in that ambition and to have some excitement about the possibility that bus services can provide in terms of community assets. We have had a glimmer today of some of those opportunities.

My noble friend Lord Berkeley showed not only that you can have some innovation and excitement but that you can actually save money by pooling all those services. It seems foolish that social services pay for one set of transport while education pays for another, and no one ever thinks that they could pull that together into one complicated yet coherent grid.

I am pleased that the Minister spoke positively in response. I am slightly sad that he thinks this should go in guidance. I know we debate this over and over again, but guidance does not have the same weight as legislation. From our perspective, the social value Act is worth specifying in the Bill because it brings very specific requirements. I look forward to receiving the letter, when it eventually comes to us, but we need to explore how much more we can enforce this within the Bill rather than leaving it within the guidance. Perhaps that can be part of the wider discussion for us to have outside. In the meantime, I beg leave to withdraw the amendment.

Amendment 58A withdrawn.

Bus Services Bill [HL]

Baroness Jones of Whitchurch Excerpts

Monday 4th July 2016 Lords Chamber

[Lord Berkeley (Lab)]

My Lords, I will be brief. I support the amendments in the names of my noble friend Lord Bradley and the noble Baroness in this grouping. The noble Earl, Lord Attlee, has a point about why franchises should be postponed or cancelled. It brings to mind the situation in which a franchise is advertised and several companies respond, spending quite a lot of money in the process. If it is then cancelled for no particular reason, they could probably reasonably ask for their tendering costs to be reimbursed, although that will probably never happen. However, it behoves the franchising authority to produce a franchising document against which companies will bid, and if nobody bids, it will not have achieved anything. Therefore it is not all one-way. My gut feeling is that if it makes a mess of it and then issues it again within six months or so, that is much too short a time, but on the other hand five years is too long. The noble Earl, Lord Attlee, made some good points in his amendments, but I would reduce the time to two years or so, which is a more reasonable time in which to do this.

[Baroness Jones of Whitchurch (Lab)]

My Lords, I will first speak to Amendments 59 and 60 in the name of the noble Earl, Lord Attlee, which specify that any decision to postpone or cancel a franchising scheme cannot be revisited for five years.

There are many legitimate reasons why these decisions are postponed, and we believe that there is a danger that this amendment would have the converse effect of forcing imperfect schemes to proceed, to avoid the five-year moratorium. On the other hand, we believe that there are enough checks and balances in the Bill to allow decision-makers to reflect and rethink their proposals, so a ban for five years on revisiting the option is unnecessary and we would not support it.

Amendment 66 in the name of my noble friend Lord Bradley seems to provide a safety net for franchise providers to ensure that service permits which are issued do not undermine the viability of franchise schemes as a whole. This seems sensible, so we support the amendment.

Finally, we support the concept in Amendment 67 that any franchise service permit issued should first be subject to consultation, not only with the service providers but with the service users. This theme has run through a number of our amendments and we support it in this context. I therefore hope the noble Lord will agree with the sense of that amendment.

[The Parliamentary Under-Secretary of State, Department for Transport and Home Office (Lord Ahmad of Wimbledon) (Con)]

My Lords, I thank all noble Lords who have taken part in this debate. I will take each amendment in turn, beginning with Amendments 59 and 60.

Amendment 59 would enable franchising authorities to cancel the date on which local service contracts may first be entered into for a franchising area or sub-area. I admit to being unclear as to the purpose of this amendment and would welcome further clarification from my noble friend. The amendment that my noble friend proposes is to the section in the Bill which enables franchising authorities to postpone the date on which local service contracts can first be entered into, for example to deal with a situation in which the procurement exercise takes longer than anticipated.

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[Baroness Randerson]

That is a separate issue. The issue here is enabling local authorities to make a reasonable judgment in order to produce a good franchising scheme. I accept that there are separate issues to be addressed in relation to competition.

I turn to Amendment 74, on the power to obtain information about local services and franchising, and the handling of that information. This is purely a probing amendment designed to investigate the unevenness within the Bill. I have referred to the uneven approach to the three types of schemes and simply wish to point out to the Minister that on page 58 of the Bill appear identical words to those in my amendment, which set out the circumstances in which information could be disclosed in the case of enhanced partnerships. However, in the case of franchising, on page 33 there are no such caveats or restrictions on the use of the information. I am interested to find out from the Minister the legal reason behind this—or is it just chance that there is a long list of things that one can and cannot do with that information in the case of enhanced partnerships, but which are not included in the list on franchising?

[Baroness Jones of Whitchurch]

My Lords, I shall speak to Amendment 70, which requires bus operators to publish data. A number of noble Lords have commented on this already. Data on the environmental impact of operators’ fleets, including the impact on air quality, the level of CO₂ emissions and their safety record, should be available to local authorities and passenger organisations alike. It would be our intention that this information could be independently verified. These amendments build on our earlier debates on the need for buses to play their part in making our towns and cities healthier places to live and work. We believe that the bus operators have an obligation to deliver higher environmental standards and meet the requirements of low-emission buses. To be held to account for these commitments, the data have to be available to those who can best judge operators’ performance. The same arguments apply to safety standards, so that all passengers can be assured that their provider is working towards zero tolerance on safety failures.

I, too, disagree with Amendments 71 and 72 in the name of the noble Earl, Lord Attlee. Amendment 71 aims to restrict the information provided to a franchising authority. We accept that some information needs to be identified as commercially sensitive but we do not accept that most of the information listed falls into that category. We need to be clear what is commercially sensitive and what is not. However, in most other comparable public services, the sorts of information we are talking about would be made public and shared. It would go beyond just giving it on a private basis to the local authority, and would be made more public. That is what we would expect in this instance.

Meanwhile, Amendment 72 requires bus companies to be paid for providing that core service information which, of course, would be crucial to a franchising bid, such as journeys taken, passenger numbers and fares. The point has already been made that operators will already have this information, so there is no additional cost involved. We contend that local authorities should have the right to this information and it would be standard practice to provide this service information in other contract bids.

We also believe that there should be more open sharing of data so that passengers and communities can have a greater input into the types of services they would like, and can have that input on an informed basis. I therefore hope that noble Lords will support the principles of openness set out in our amendment and oppose those attempts to have a more closed and secretive regime.

[Lord Ahmad of Wimbledon]

My Lords, there are a number of amendments in this group—I will take them in turn—which relate to enabling franchising authorities to request information from local bus operators in connection with their franchising functions.

My noble friend Lord Attlee made some important points on Amendment 71 in relation to the purpose for which authorities may use information. The powers given to franchising authorities in this clause are designed to ensure that they can obtain the information they need to take informed decisions about franchising schemes. We want the elected mayors and local transport authorities who take these decisions to have an appropriate understanding of the local bus market and robust information to inform their views of potential benefits, costs and risks.

Franchising authorities are able to request relevant information in connection with their functions only in relation to franchising schemes. They are not able to request the information for any other purpose under this section and would not be able to use this section to require information in the context of developing an enhanced or advanced partnership or an advanced ticketing scheme.

I can see that the industry might have concerns if this power were used regularly by authorities which were repeatedly contemplating high-level options—perhaps even without the agreement of elected members, or if the information, once obtained, was used for a different purpose. I also recognise that there are some potentially significant commercial risks for operators in providing this information.

It may be helpful if I clarify that the Bill ensures that franchising authorities are not obliged to publish information if they could refuse to disclose such information under freedom of information or environmental information legislation. There is nothing to prevent a bus operator informing a franchising authority of any concerns it may have about the impact of releasing certain information on its commercial interests. Let me assure the House that I expect all franchising authorities to consider such concerns before deciding how to use the information provided. I hope that reassures my noble friend that I have sympathy with the spirit of his amendment. I do, however, have some concerns about how the change he proposes would work in practice.

First, the amendment would prevent the use of information in a franchising context after a scheme has been developed or made, such as at the procurement stage, which could have a material impact on the ability to implement a franchising scheme in practice. Secondly, the amendment could prevent appropriate information being included in the published consultation document or provided to third parties, such as the auditor of the scheme, who has an integral role in the process. I would therefore like to reflect on the helpful contribution from my noble friend on this issue and take time to consider how his points could best be addressed.

Amendment 72 in my noble friend’s name would require franchising authorities to pay a fee to local bus service operators from which they have required information in connection with their franchising functions. I know that my noble friend spoke very eloquently on this subject at Second Reading, and I understand that he is concerned about the commercially sensitive nature of the data, and value of those data. I also know that bus operators across the country have put years of hard work into developing their businesses, and have built up strong reputations and good will with customers and local people. I sympathise with the concerns that my noble friend expresses on behalf of the bus industry, but I need to balance those concerns against a desire to see well-informed decisions being made.

Bus Services Bill [HL]

Baroness Jones of Whitchurch Excerpts

Wednesday 29th June 2016 Lords Chamber

[Lord Bradshaw]

My Lords, perhaps I may add a point to what the noble Lord, Lord Whitty, said. Any move towards smart ticketing or reduced fares for young people is revenue-generative. It is not a dead-weight cost. In fact, some bus operators are voluntarily introducing reduced fares for young people and they are finding that they can be almost self-financing. Young people have a very high propensity to travel. They will travel at the weekends and in the evening, provided that the cost does not build up.

[Baroness Jones of Whitchurch (Lab)]

My Lords, I am grateful to the noble Baroness for the amendments and for explaining their intent so clearly. As she said, Amendments 8, 17B and 54A would all help add clarity and certainty to the standards of provision to be expected from advanced quality partnership and franchise schemes and are therefore to be welcomed. The noble Baroness spoke about there being too many “may”s in one clause. They do rather render the clause ineffective, so we support the proposed changes.

Amendment 15 raises important issues about the elements of a quality bus service that we should expect following the introduction of the Bill, including controlling emissions levels and making travel easier through advanced ticketing schemes. Until I sat here today, I did not know about my noble friend Lord Whitty’s great victory. I congratulate him; it is nice to have a legacy like that. In all the doom and gloom around us, at least he can lay claim to something that we have all appreciated. As we have heard from a number of noble Lords, such travel passes transform the way people use bus services and it is the way that we want to go.

We will explore these issues in more detail in later amendments, but we nevertheless support the amendments in this group. I look forward to hearing what the Minister has to say in response. We have got into a pattern of response from the Minister that is slightly disappointing. The first line of defence is, “Don’t be too ambitious, because, if you are, you’ll put the bus operators off and they will aim low if you expect too much of them”. The second is, “Don’t worry, we’re going to put in statutory guidance”. If those are the two responses we hear as we progress through the Bill, we will not get very far, because many of our amendments are about improving quality and people’s expectations. I hope the Minister will meet us half way a little more often on some of these issues than has been the case so far.

We have great sympathy also for the case made by the noble Baroness for Amendment 13A. We all want to encourage more young people to be regular bus users and to make it affordable for them. We would like to take time to consider the cost implications—she acknowledged that there were issues in that regard, particularly for local authorities. If the measure is not fully costed for local authorities, what would be the knock-on effect? However, it is an important debate that we need to follow through. I was interested to hear from the Minister that a review of the concessionary fare scheme is taking place. Perhaps he could clarify whether young people’s fares are included in it. I am not sure what the scope of the review is, but it is one place where we could have that wider and highly relevant debate.

[Lord Ahmad of Wimbledon]

My Lords, once again, I thank all noble Lords who have contributed to this debate. The noble Baroness, Lady Randerson, introduced the amendments by saying that she was finding living with “may”s a little challenging. I for one can say that it may be a good thing if we are living with “may”, but time will tell.

There is an important distinction to be drawn between “may” and “must”. The Bill sets out a range of standards of service that may be included in an advanced quality partnership scheme. However, it is for individual local authorities to decide what standards of service to introduce as part of such a scheme. The intent behind introducing an AQPS is to provide flexibility, because the standards introduced will depend entirely on the local bus market and the needs of existing and potential bus passengers in an area. Amendment 8 would remove this flexibility. Local authorities would be compelled always to impose all the standards of service specified under new Section 113E(5). This is not a desirable approach, as some of the standards may not be appropriate in all circumstances. For example, the provision of information about bus services to passengers may already be perfectly adequate in an area that is proposing to introduce such a scheme. The amendment would also require the imposition of maximum fares even if a local authority considered such a move unnecessary. It is also worth bearing in mind that some requirements, including maximum fares, can be included in the scheme only if there are no admissible objections from any relevant operators. This is provided for in new Section 113E(7). If there were a requirement for a scheme to include maximum fares, each operator in the area would hold an effective veto over the introduction of the whole scheme.

There is another reason to be cautious about the amendment. In a deregulated market, there is no obligation on bus operators to run services that they do not wish to run. Local bus operators may not be prepared or feel able to run on a commercial basis services that comply with those requirements and may simply choose to withdraw them. If accepted, the amendment therefore runs a serious risk of undermining or even removing the viability of many existing and future schemes.

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[Baroness Jones of Whitchurch]

My Lords, Amendments 12, 23 and 88 are in my name. I very much endorse the comments of the noble Baroness, Lady Randerson, and my noble friend Lord Whitty. I think we all accept that buses are part of the solution rather than the problem when it comes to tackling environmental pollution and climate change. More passenger journeys on public transport and less car usage will inevitably have a positive impact on CO₂ emissions. This is one reason we should be concerned by the overall drop in bus usage in metropolitan areas outside London.

Sadly, the truth is that outside the great success story of London, bus patronage is around 36% lower than it was on the eve of deregulation in 1986. At the same time, as my noble friend Lord Whitty has stressed, we are facing a growing crisis in air pollution in urban areas. The Government have already been shown to be in breach of the Clean Air Act and thousands of people are dying each year. This is a public health emergency, which the Government are failing to tackle with significant vigour. At the heart of the problem is the amount of diesel fumes being pumped out by cars, lorries and buses in urban streets.

Increasing bus usage is only part of the environmental solution. Equally importantly, we need to ensure that new buses on the roads meet the highest environmental standards. I take the point made by the noble Baroness that there is also a role for retrofitting. Our Amendments 12, 23 and 88 would require all new vehicles under franchising, advanced quality partnerships or enhanced partnerships to,

“meet the specifications of the low emission bus scheme as set out by the Office for Low Emission Vehicles”,

in its 2015 document. These specifications are part of the government-backed scheme, with a £30 million grant available. They aim to increase the number of low and ultra-low-emission buses, improving air quality, reducing the impact of road transport on climate change, and supporting UK manufacturing. As such, these amendments gel perfectly with the policies being pursued elsewhere by the Government. I therefore very much hope that the Minister will recognise the sense of being consistent and will feel able to support these important amendments.

[Lord Ahmad of Wimbledon]

My Lords, I align myself with much of the sentiment that has been expressed. The noble Lord, Lord Whitty, said that we should be clear in the Bill about reducing emissions and I think that that is a general sentiment we can all share. He referred in a previous discussion to innovation and how we look at technologies and, indeed, the Oyster card. I am sure if it was called the Whitty card we would feel a lot happier travelling on public transport. Perhaps that is a thought for the London mayor to contemplate. He was talked about just now as the next Prime Minister. We are certainly going to have one Prime Minister before that, if not more, from the Conservative side. Let us bear that in mind as the factual reality we have to face.

Coming back to the Bus Services Bill, I understand the aims behind these amendments and I agree totally that buses have a huge part to play in solving some of the country’s air quality problems and, indeed, combating global warming. I further agree that it would be beneficial to local people and our local environments if low-emission technologies were adopted more widely.

Starting with Amendments 9 and 11, the advanced quality partnership scheme allows the local authority to take a judgment on the vehicle specification that is most appropriate on individual corridors. These could be vehicles of no more than a certain age, a type of vehicle that best suits local road conditions or passenger needs, or vehicles that meet certain emissions standards. Provision for local authorities to continue fully to specify the type and standard of vehicle used under the advanced quality partnership scheme is already provided for in new Section 113E(4). This provision would also allow the local authority to specify the emissions standards of the vehicles concerned.

It would not be legally possible for the scheme to set standards for vehicles that are not used on routes covered by the scheme. The environmental performance of vehicles, beyond mandatory requirements, in the deregulated bus market outside partnership or franchising scheme areas or low-emission zones is very much a matter for individual bus operators. In view of this, the amendments submitted by the noble Baroness, Lady Randerson, supported by the noble Lord, Lord Bradshaw, would simply duplicate this existing provision. I hope that with the explanation I have given she will feel able to withdraw and not move her amendments.

Amendments 12, 23 and 88, in the name of the noble Baroness, Lady Jones, would require advanced quality partnership schemes, franchising schemes and enhanced partnership schemes to prescribe the specifications of the low-emission bus scheme. I stress again that the Bill is about devolution—giving local areas a broader suite of tools to enable them to improve local services in a way that suits them. I am concerned that the amendment as drafted may unnecessarily tie the hands of authorities looking to implement franchising, advanced quality partnerships or enhanced partnerships, requiring them to specify higher standards for vehicles than in other parts of the country.

Of course, it is important to note that these higher standards will bring extra costs. In franchising in particular, the authority must, among other things, describe the effects that the proposed scheme is likely to produce and consider whether the scheme is affordable. Requiring a higher standard for vehicles may well bring extra cost to the authority, which may lead it to decide that the scheme is not viable. There would also be a cost implication for operators. Where those standards are necessary, the legislation already allows local authorities to bring them forward. Where they are not necessary, they could end up being provided instead of other benefits for passengers that may be more important to local passengers and politicians.

Amendment 36 would require franchising authorities, as part of their assessment of their proposed franchising scheme, to consider the effects of the proposed scheme on air quality and carbon emissions. I am very sympathetic to the aims of this amendment and hope I can reassure the noble Lord that the Bill as drafted will already require authorities to consider how their proposed franchising scheme will impact on air quality and carbon emissions.

Franchising authorities have to conduct a thorough assessment of their proposed scheme, and then consult. I agree entirely with the sentiment expressed by several noble Lords that air quality and carbon emissions should be two of the areas that are considered by authorities when they are conducting their assessments. I assure noble Lords that we are in the process of developing statutory guidance to complement the provisions in the Bill and to which franchising authorities must have regard, and we will be looking to use that guidance to provide further explanation of how franchising authorities should conduct their assessments of their proposed franchising scheme. That guidance will of course mention the need to assess the impact of the proposed scheme on the air quality of the local area and on the levels of carbon emissions.

There are many ways in which we can encourage authorities and bus operators to utilise lower-emission vehicles. Under the green bus fund, government funding has helped put more than 1,200 low-emission buses on our roads since 2009. Building on that success, the current £30 million low-emission bus scheme should deliver hundreds more such buses over the next three years.

I hope this discussion has persuaded noble Lords that I agree about the importance of encouraging the take-up of low-emission vehicles, but I think there are more effective ways to achieve these aims across the country. On the point that the noble Baroness, Lady Jones, made, I am happy to discuss with her how we could look at drafting amendments—perhaps not to look at things retrospectively but, as we have discussed in meetings outside the Chamber, for future vehicles—to ensure the kinds of standards she asks for. Perhaps we could take some time to discuss how we can move forward on that front. But with those explanations of where we are currently, I hope noble Lords will be minded to withdraw and not move their amendments. I hope my final comment may have at least brought a smile—which it has—to the noble Baroness’s face that we are in listening mode. I agree with the sentiment expressed by many noble Lords that this is an opportunity. We have waited a long time to bring this forward. The legislation is now in front of us and it is up to us to improve it to provide the kinds of services we need around the country.

Bus Services Bill [HL]

Baroness Jones of Whitchurch Excerpts

Wednesday 29th June 2016 Lords Chamber

[Lord Berkeley]

My Lords, I rise to speak on behalf of my noble friend Lord Bradley on Amendment 22. It is one of these odd arrangements when you have, in one group, the Minister moving a government amendment and then somebody else proposing an amendment, so the Minister answers before you have stated the case. But I do want to state the case. My noble friend is very apologetic.

The purpose of this amendment is to make it possible for a passenger transport executive to enter into a local service contract with operators once the ITA or combined authority has decided to implement a franchising scheme. New Section 123A(4) of the Transport Act 2000 sets out which bodies qualify as franchising authorities, but the list does not include passenger transport executives. In a number of metropolitan areas, the PTE continues to be the executive body for transport responsible to the combined authority. This amendment would explicitly allow a PTE to be the contracting body if that was judged most appropriate locally.

The amendment would also help to future-proof the legislation, given the way the Government’s arrangements continue to evolve in different ways in different areas. I would be very pleased to hear the Minister’s response to this. That is the message from my noble friend Lord Bradley.

[Baroness Jones of Whitchurch (Lab)]

My Lords, very briefly, first, we accept the case made by the Minister that Amendment 20 is a tidying-up amendment and that it is not necessary to make explicit provision in the Transport Act 2000 for advanced quality partnerships, franchising and enhanced partnerships. We are therefore content with this change.

We also support the amendment of my noble friend Lord Bradley, which would extend the prescriptive proposals on franchising authority functions to the executive of an integrated transport authority if needed. This reflects the reality of decision-making in a number of larger authorities and is therefore a more practical application of the Bill. We were very pleased to hear that the Minister has agreed to take that away and do more work on it. We look forward to hearing the outcome of those further deliberations.

Bus Services Bill [HL]

Baroness Jones of Whitchurch Excerpts

Wednesday 8th June 2016 Lords Chamber

[Baroness Jones of Whitchurch (Lab)]

My Lords, I am grateful to the Minister for introducing the intentions of the Bill so clearly. It is a Bill that we regard as long-promised and eagerly awaited. It recognises what we have been saying for some time: that deregulation of the bus system has proved a failure both for customers and transport planners alike. In England, outside London, since deregulation, bus patronage has steadily declined, fares have shot up faster than wages, and routes and services have been axed. Conversely, since 1986-87, patronage in London has doubled, bus mileage has increased by 74% and fare increases have been lower than in the city regions. So we welcome the Bill’s underlying intention to bring back some order to the system, learn from the successful models, reverse the decline in the number of passenger journeys taken, and drive up quality and reliability.

It is absolutely right that these decisions should be taken locally by those who know best the challenges and opportunities of providing public transport in their locality. Although there is much in the Bill to applaud, this does not mean that we do not have major areas of concern that we will need to explore in Committee.

Before I flag up some of those concerns, I would like to say something about the drafting of the Bill. It follows an unwelcome trend, already criticised by the Delegated Powers Committee in respect of other Bills, of giving an inordinate number of powers to the Secretary of State. In total, there are 28 provisions in the Bill for the Secretary of State to make regulations, and some of these allow for more than one regulation to be made. There are only 26 clauses in the whole Bill, so its weight is in giving secondary powers via regulations that we have not yet seen—and I am not sure what plans are afoot to make drafts available before the Bill is passed.

We are concerned that we are being denied the information and detail that we need to make informed decisions on the legislation. As the Delegated Powers Committee says in its latest report:

“This Committee and others have noted a trend whereby delegated legislation has increasingly been used to address issues of policy and principle, rather than to manage administrative and technical changes”.

It goes on to say:

“The result is that the Government can pass legislative proposals with greater ease and with less scrutiny where they are able to do so through secondary, rather than primary, legislation”.

We share the committee’s concern, as it applies to this Bill, where the proposed regulations cover far more than just the administrative and technical detail. In addition, we still await sight of the impact assessment and the draft guidance which will underpin the Bill. There does not seem to be much of an excuse for the delay, given that the Bill was originally promised in the 2015 Queen’s Speech, so there has been plenty of time to prepare it.

I turn to our major areas of concern. First, we believe that the powers in the Bill to regulate local bus services via franchising should be made available to all areas that want them, not just combined authorities with an elected mayor. We are concerned that this provision is being made for political reasons, to force authorities to go down the elected mayor route, rather than what is in the best interest of local bus services and their passengers. There is of course scope for other authorities to win the right to franchise, but the criteria for this are so far lacking and remain firmly with the Secretary of State. This goes against all the principles of localism and devolution which the Bill claims to champion. Furthermore, the enhanced partnership powers included in the Bill are available to a local authority only if a sufficient number of bus operators in a locality are in agreement. This makes it all too easy for one huge operator in an area to have a final say on whether a new partnership should be developed.

Secondly, we do not accept the premise in Clause 21 that local authorities should be prevented from awarding a bus contract to a municipal operator. This model has worked well in a number of areas; for example, Nottingham City Transport has been UK bus operator of the year three times and has an impressive customer satisfaction level. It should be up to a locality to decide which model suits it best. We need also to ensure that local authorities are protected from legal action by bus operators whose profit base might be affected by bus retendering. We would be interested in exploring the Government’s role in insuring local authorities against such action.

Thirdly, we would like to see disability provision on buses strengthened. For example, we need to ensure that all drivers receive mandatory training in disability awareness. We also support the move, promoted by Guide Dogs among others, for audio-visual systems to be a requirement in all new buses. So far, less than a quarter of all buses have audio-visual announcements, yet they play a vital role in enabling disabled people to live independent lives, as well as providing an essential service to visitors, the elderly and infrequent travellers.

Fourthly, we would like to see a much greater requirement for all new buses to run on clean energy, to have energy-saving cut-outs when stationary in traffic and to make their contribution to the Government’s obligations under the Clean Air Act.

Finally, the Bill hardly mentions passengers. We believe that there should be a requirement to consult passenger representatives when changed partnerships are developing and when tendering is taking place. We would also like to see an independent body have responsibility for ensuring that the passenger voice is heard and that complaints are taken seriously. This could include petitioning against particularly poor service providers.

These are just some of the issues we look forward to exploring in more detail in Committee and beyond. It is a rare and crucial opportunity to put bus services back at the centre of a strategic public transport policy. We look forward to working with other noble Lords and the Minister to improve the Bill on this basis.

Queen’s Speech

Baroness Jones of Whitchurch Excerpts

Monday 9th June 2014 Lords Chamber

[Baroness Jones of Whitchurch (Lab)]

My Lords, I will concentrate my comments this evening on the Government’s proposals for education, an issue referred to in the gracious Speech in terms I can best summarise as “more of the same”.

This approach shows a deeply worrying level of complacency, given the problems which are causing discontent among parents, teachers and educationalists. The Trojan horse scandal in Birmingham, which we were debating this afternoon, has highlighted the failures of government policies, but it is not the only one. Only last month, a damning Public Accounts Committee report accused the Department for Education of spending £240 million on free schools in areas which do not need them, and of then being unable to give a consistent explanation of how it approved or rejected free school applications. Take the case of Steiner Academy Five Valleys free school in Stroud, which is seeking to open in an area which already has a surplus of places and is therefore threatening the existence of some excellent village schools in the area. This is not unusual.

All this is taking place against a backdrop of a crisis in school places which has led to a doubling in the number of infant class sizes of more than 30 pupils since 2010, amid persistent reports that parents are struggling to find places in local schools. Meanwhile, sadly, the Government have no effective system for school improvement. Michael Gove’s strategy is to let schools sink or swim and, to be frank, many of them are sinking. According to Ofsted, nearly 1.5 million children are being taught in schools that require improvement, and nearly 250,000 pupils are languishing in inadequate schools. Goole High School, recently converted to an academy, is a good case in point. Having been judged inadequate in all categories, its recent plan to get out of special measures was judged “not fit for purpose” by Ofsted. Meanwhile, the children at the school continue to suffer. Of course, Michael Gove famously and repeatedly denigrated the very people he needed on side to turn the situation round, describing teachers as “the enemies of promise”, and introducing reforms at a pace that has frequently caused administrative chaos in the classroom. I would therefore describe the Queen’s Speech as a missed opportunity to drive up standards in all schools and to deliver excellence for all young people.

In contrast to the abrasive, singular ideology with which Michael Gove has approached reform, our party is developing a different approach. Our education agenda is centred on a “what works” policy that draws on the best of best practice, takes account of evidence, works with the practitioners and prepares the country for the future, not the past. This is why we are committed to introducing local directors of school standards to ensure oversight and accountability at community level. This will allow us to address underperformance up front and decisively, rather than waiting for whistleblowers or Ofsted reports to ring alarm bells in the department.

Secondly, we will build on the concept of school autonomy first developed by David Blunkett in 1997, extending the freedoms of academies and free schools to all schools. Importantly, however, we will differentiate between autonomy and isolation. The lesson from the highly successful London Challenge programme, introduced by the previous Government, is that the schools which are most effective are those which collaborate and work in partnership. This will be a clear expectation.

Thirdly, we will address the skills gap, a frequent concern of business leaders, by creating genuine parity between vocational and academic education. This will be built on a national baccalaureate framework for all pupils aged 14 to 19. In addition to A-level or high-quality vocational qualifications, all learners would study maths and English to 18, undertake an extended study or collaborative project and develop their character and resilience through individual programmes of work or community service.

Finally, and crucially, we will reverse the Government’s hostility to the teaching profession by recognising that the most effective way of improving children’s attainment is by raising standards of teaching to deliver a world-class teacher in every classroom. We will begin by ending the wrong-headed policy of encouraging unqualified teachers. Instead, qualified teacher status will be the bare minimum. In addition, we would expect all teachers to undertake regular professional development.

Unlike this Government, our approach would be a collaborative one, which learns from the best and delivers the best for every child. This coming legislative programme was an opportunity for the Government to learn from their mistakes and put their education programme back on course. Sadly, they have chosen not to take up this opportunity, so we on these Benches stand ready to take up that challenge.