Passenger Train Services

Baroness Scott of Needham Market Excerpts

Wednesday 29th April 2020 Lords Chamber

[Baroness Vere of Norbiton]

On the latter part of the noble Lord’s question, I would not want to pre-empt the Williams Rail Review by giving any indication as to what is in it—mostly because I do not actually know, not being the Rail Minister. On the publication date, I will take that back to the department to see if I can get an updated date for him, and I will write to him.

[Baroness Scott of Needham Market (LD)]

To what extent will demand for rail services be taken into account when deciding which sectors will be unlocked? How will this be managed given the significant regional variations in the use of rail for commuting?

[Baroness Vere of Norbiton]

That is an incredibly important question. I am sure the noble Baroness will understand that we are considering all these issues at the moment. There will be regional variations according to which services are more likely to be used. There will also be variations with long-distance services and short-distance commuter routes. All these considerations are being put in. Also, when restarting public transport, one of the key things that we will have to do is look at local impacts—working with metro mayors, for example, and local transport authorities to make sure that they feed into the system and help us plan for their local economies, to get people back to work.

Transport: Buses

Baroness Scott of Needham Market Excerpts

Thursday 24th October 2019 Lords Chamber

[Baroness Vere of Norbiton]

I thank the noble Lord for his question, but I also point out that this Government support the bus sector to the tune of £2.2 billion from the taxpayer. That is 12% higher in real terms than under the last Labour Government. I also point out that the £1.3 billion that the Labour Party proposes putting into buses seems to be coming away from road maintenance and upgrades. That is a false economy, because one of the key issues in getting people back on buses is journey reliability, and that relies on good roads.

[Baroness Scott of Needham Market (LD)]

My Lords, important new powers were introduced in the Bus Services Act 2017, but because they are available only to areas with elected mayors, most rural areas are excluded from them. If experience shows that these powers are effective, will the Government rethink their availability to rural areas?

[Baroness Vere of Norbiton]

I hate to disagree with the noble Baroness, but there are two different types of powers that came in under the Bus Services Act. The first is the franchising power, and in that regard, she is right; it is available only to local elected mayors, because it needs a significant grouping of bus operators and also the population. What is available to all local authorities, and is really important, is enhanced partnerships, where the local authority works with the operator. The local authority can put in place bus priority measures and parking enforcement and, in return, the bus operator can provide better ticketing information and faster services.

Thomas Cook

Baroness Scott of Needham Market Excerpts

Wednesday 25th September 2019 Lords Chamber

[Lord Rosser (Lab)]

My Lords, I thank the Minister for repeating the Statement made earlier in the Commons.

The collapse of Thomas Cook is a tragedy for the 178 year-old iconic business, its customers and its staff here and around the world—many of whom are still working to assist those who are seeking to return home to the UK. I note the inquiries that the Government have initiated. I have a number of issues to raise with the Minister about the background and lead-up to the demise of Thomas Cook.

Last year, the company was urged by its auditor EY to stop using an accounting method that could have been used to flatter its financial performance and, in the process, improve the pay of the top executives, since their bonuses were linked to performance. Given that the Government would have known that the collapse of Thomas Cook would involve taxpayers’ money to bring stranded passengers home, and since the Secretary of State said in his letter to MPs and Peers two days ago that,

“We have been contingency planning for some time to prepare for this scenario”,


what action did the Government take in the light of the auditor’s clear warning about the accounting method being used by Thomas Cook and its impact on flattering financial performance and improving the pay of the few at the very top?

The Times also reported the criticism, including from the Prime Minister, of the top executives of the company for paying themselves large sums of money—a combined total of more than £20 million over the past five years. The only people in Thomas Cook who seem to be coming out of this with plenty of money in their pockets would appear to be those who have been at the top of the company. In the light of the auditor’s concerns on the issue of accounting methods, what pressure, if any, did Ministers put on the directors of Thomas Cook to change their ways?

We certainly know of one area where the Government have done nothing. The previous Secretary of State had said that he would introduce a new levy-funded regime to keep bankrupt airlines flying temporarily, but no legislation has appeared. A review called for changes in the law to enable airlines to continue flying for sufficient time to enable them to repatriate their passengers. However, as I understand it, the Government have not even formally responded to this review. The Minister will know that a similar system exists in some other countries, including in Germany, where Condor, Thomas Cook’s sister airline, operates. I understand that the Government have provided funds to help that company survive. I note that the Minister is looking at whether it is possible for airlines to wind up in an orderly manner without a need for the Government to step in. However, the truth is that the Government have done nothing since the failure of Monarch Airlines two years ago, which the noble Lord, Lord Callanan, referred to earlier.

Regarding the Government’s approach over the demise of Thomas Cook, did the Government receive a request for financial support to help tide the company over for the next few months? If so, what exactly was the request, when was it received, what was the Government’s response and what were the reasons for that response? Is it the case that Thomas Cook had reached an agreement or understanding to secure around £200 million with the assistance of the Turkish Government and Spanish hoteliers backed by the Spanish Government but that, when the UK Government indicated they would not act to support a British brand, that effectively killed any such agreement or understanding?

What is the Government’s estimate of the final potential or likely cost to the taxpayer, both direct and indirect, of Thomas Cook’s demise? Can the Minister provide a breakdown of how that estimated or potential cost is made up?

We know that some will benefit from the misery of the 9,000 people losing their jobs in this country, as well as from the disruption and worry experienced by up to 150,000 Thomas Cook customers. For a start, people who have already lost their anticipated holiday due to the decision to let Thomas Cook go to the wall are likely to have to pay considerably more to book another one. The cost of flights is now reported as doubling or trebling—or, to put it euphemistically, as one airline did:

“Our pricing, as is common practice in the travel industry, is based on the principle of supply and demand. As supply reduces, an inevitable consequence is that prices increase”.


There is no doubt that the increased income for the other airlines who are now putting their prices up dramatically will be reflected in substantial increases in the bonuses of those in their boardrooms—paid for by people who had their anticipated holiday with Thomas Cook snatched from them. Do the Government find this acceptable, or do they intend to take any action to ensure that people who have lost their Thomas Cook holiday will be able to secure an alternative, equivalent holiday at no further expense to themselves?

With high streets up and down the country having now lost yet another major name, will the Government be taking any new action to assist our already pressured high streets?

We have also read in the press that international hedge funds which bet against Thomas Cook have made substantial profits from its collapse and the misery of staff and holidaymakers. Apparently, nearly 11% of the travel company’s shares were shorted ahead of its collapse. Hedge funds will also apparently benefit from credit default swaps as a result of the collapse, with payouts expected to reach £201 million. This seems a very similar figure to that which Thomas Cook was seeking and with which the Government declined to assist.

Coming back to the Secretary of State’s letter and his statement that

“We have been contingency planning for some time to prepare for this scenario”,


why is it, then, that some Thomas Cook holidaymakers and staff have apparently been locked out of, or even in, their hotel rooms until they have settled any outstanding bills? The Minister helpfully confirmed that the CAA has taken initial steps to resolve a number of incidents, but are the Government satisfied that this action will be sufficient to avoid any repeats in the days and weeks ahead?

The Government have indicated that they are seeking to help those made redundant to find other jobs. Bearing in mind that Thomas Cook shops are found throughout the country, including in areas where appropriate jobs are in short supply, what timetable have the Government set for finding suitable alternative employment for redundant Thomas Cook staff? Are they guaranteeing that that employment will be at least at or near their current salary levels? Will they ensure that all staff affected receive the compensation and other payments to which they are entitled in full and without employment tribunals?

Like the Minister, let me finish by paying tribute to the team at the Civil Aviation Authority and those in government departments for the work that they are doing to repatriate Thomas Cook passengers. They are displaying a sense of public service and duty. Just as in the case of Monarch Airlines two years ago, their hard work and dedication is highlighting that, when the private sector fails, the public sector has to step in to pick up the pieces.

[Baroness Scott of Needham Market (LD)]

My Lords, I thank the Minister for repeating that long but very useful Statement, and for the letter that was sent out to Members. I echo the thanks to the staff of airlines, customer services, ground crew and so on, who have done so much to restore some order to what could have been a catastrophic situation. Those thanks must especially go to the employees of Thomas Cook, many of whom are showing a degree of compassion and humanity towards their customers that is sadly lacking in the attitude of the directors.

Given what we know already about the state of Thomas Cook, can the Minister say more about how the Government are going to, and I quote from the Statement,

“seek to understand the failings of stewardship”?

I will not repeat the points made by the noble Lord, Lord Rosser, but these questions of governance and of the failings of governance are key, both to prevent this happening again and in protecting consumers in this sector and others.

I can understand why the Government were reluctant to go in with a classic bailout, but I wonder whether they ought to have thought more about whether it was possible to fund Thomas Cook for a few weeks, specifically to bring back those customers who were already abroad. Might that not have been more efficient than having to scrape around for aircraft wherever we could get them? I would like to know more about that.

I understand that CAA guarantees to hoteliers apply only to those passengers who have ATOL protection. There are 40% who do not have that protection, and we are hearing all sorts of stories about people being locked out of accommodation. Not everyone has the financial resilience to simply pay a bill on demand to a hotel, especially as they have already paid once for a holiday, so I would like to hear more about the 40% who are not covered.

The Minister may be aware that the vultures are already gathering, and there are stories emerging of scams where people purporting to be from Thomas Cook are offering refunds to get people’s bank details. Will she urgently consider a social media campaign to highlight the dangers of this and setting out exactly what people should do if they have been affected?

[Baroness Vere of Norbiton]

I thank both the noble Lord, Lord Rosser, and the noble Baroness, Lady Scott, for their thoughtful questions and comments about this difficult situation.

The noble Lord, Lord Rosser, talked about the various reviews that the Government will make sure are undertaken as a matter of great urgency. He also mentioned the accounting methods and the comments from EY. Thomas Cook of course uses IFRS, the standard accounting rules. Those are used in 125 countries and have been adopted by the EU. Some people will push those to the absolute limit, and maybe Thomas Cook did, but we cannot say for sure. Once we have got to the stage where the repatriation has finished successfully and everyone is home, we certainly will look into all sorts of things, including its application of the various accounting rules. The official receiver will review all payments made to the board and creditors in the lead-up to the date when the board declared the company insolvent. The official receiver is able to recall payments if it feels that they were not made in the right course of business.

The noble Baroness, Lady Scott, mentioned governance, which is really important as well. I hope that when these reviews have been finished, we will take away a number of lessons from them. The travel industry has always operated in the way it does. The issue now is that some of these organisations are very large, and when the worst happens it has a very significant consequence. Therefore, we as a Government need to think about the long-term future for aviation and travel organisations when they become insolvent.

This brings me on to the second major area commented on by the noble Lord, Lord Rosser: the airline insolvency review, which we asked Peter Bucks to undertake after Monarch. He submitted his report to the department in May this year. It is a long report; I am sure the noble Lord has read it. It has many different proposals—it was one of my responsibilities as the former Aviation Minister to go through it and see how we were going to take these various things forward. None of the things in it is easy, simple or without risk. There was a possible levy on passenger tickets but, as noble Lords will know from the repatriation today, simply having the money is only one thing—one has to have the aircraft.

That was the second thing that might be suggested: some sort of special administrative regime for an organisation. Again, that is quite complicated. I think we have one for energy companies and one for universities, but they are very difficult to put in place and require primary legislation. We are looking at that as a matter of urgency. The noble Lord also suggested looking at financial instruments. Again, we have been looking into that, at how they might either help or hinder—they might speed up a company’s demise.

I believe the German Government have been able to provide a bridging loan. I understand that Condor is in a different financial situation from the Thomas Cook Group as a whole, and maybe it is viable in the longer term. I very much hope that it is. However, we received a request from Thomas Cook for government support. I do not recall the date of the letter—it was possibly Friday. I will have to write to the noble Lord with all the details on what we received at what point and the reasons we decided to decline. I suppose one of the most obvious reasons was that Thomas Cook has until very recently been losing about £250 million a month, so it was not entirely clear to us that £250 million would be a good and viable long-term solution for a company which was clearly being weighed down by an incredible amount of debt.

The final cost of the repatriation is not known at this moment. I mentioned that it was £50 million for Monarch; this is at least twice the size and much more complicated. It is a fast-moving situation, but of course we are striving to keep costs to a minimum and are in open discussions with a number of third parties with which we will look to reach an agreement over future financial support.

With regard to the industry taking advantage, I agree with the noble Lord that this is very disappointing indeed. We do not expect anybody to take advantage in a difficult situation. On the flip side, I am very pleased by the support that we are being given by certain airlines—for example, BA and Virgin, which have both been offering rescue fares to people in places where we do not have repatriation flights.

Obviously, we have done a significant amount of contingency planning. We knew what our plan was for the hotels, but until the event actually happened we could not put that plan into place. The letters went out to 3,000 hotels; imagine you are a hotel far away and you get a strange letter from the British Government saying, “It’s okay, we’ll pay the hotel bill”. It just took a while for the message to get through. We used our diplomats and consular staff to get out there and talk to the hotels. We also went straight in at ministerial level, saying to Tourism Ministers, “Please can you speak to the hotels to make sure that people are not thrown out of them?”

The noble Baroness, Lady Scott of Needham Market, also talked about what we called when doing contingency planning “keep the fleet flying”, which would of course seem obvious to anyone—they are planes, why can we not get them up in the sky? We really tried to look into that, but we need the legislation for that to continue, because operating an airline is not as simple as having a pilot and putting a plane in the sky. Unfortunately, one needs many indemnities and certificates, but we hope to be able to put something in place which would allow the fleet to continue to fly so that, should this ever happen again, that would be the most obvious way of sorting it out.

Those passengers not guaranteed by ATOL may well have other routes that they can use if they pay by credit or debit card or through travel insurance. If there is one other thing that has come out of this, it is that many people go on holiday nowadays and do not think about travel insurance or what might happen if the travel company goes into liquidation. People might want to think differently how they protect themselves when they go abroad.

I was appalled to see the scams too, people saying on social media that they are getting telephone calls from people saying that they can get their money back. We are working on it and the CAA will be putting out some stuff—it might already have gone out—making sure people are aware that there are scams out there. The good thing is that social media is doing its own thing. People who are not connected are already saying, “Beware, there are some very dodgy people out there”.

Buses: Rural Services

Baroness Scott of Needham Market Excerpts

Tuesday 16th July 2019 Lords Chamber

[Baroness Randerson]

To ask Her Majesty’s Government what steps they are taking to improve rural bus services.

[Baroness Scott of Needham Market (LD)]

My Lords, on behalf of my noble friend Lady Randerson, and with her permission, I beg leave to ask the Question standing in her name on the Order Paper.

[The Parliamentary Under-Secretary of State, Department for Transport (Baroness Vere of Norbiton) (Con)]

My Lords, the Bus Services Act 2017 provides a number of tools, such as enhanced partnerships and franchising powers, to facilitate local authorities working together with operators and communities to provide improved bus services in rural areas. Furthermore, our Total Transport pilot projects encourage local authorities to innovate by joining up the commissioning of publicly funded transport services.

[Baroness Scott of Needham Market]

My Lords, the reality on the ground is that rural bus services have been in decline for some years now, to the extent that there are many quite large villages which no longer have any kind of bus service at all. Have the Government made any assessment of the impact this is having on residents’ ability to access essential public services such as health and education?

[Baroness Vere of Norbiton]

We are aware that in certain areas it is a challenge to access certain services using public transport. The Government are doing what they can to support various innovative initiatives to make sure that we improve services. The rural round table in December 2018 focused on these issues and came up with a number of opportunities whereby we can improve services, and we will be working on those opportunities and reporting back soon.

Operation Brock

Baroness Scott of Needham Market Excerpts

Monday 8th April 2019 Lords Chamber

[Baroness Sugg]

As I said, there is no evidence for the cause of the current accidents, but we are of course looking at the circumstances around each collision and considering what can be done to prevent future incidents. Highways England has already reduced the spacing between cones on the coast-bound carriageway to reduce the risk of illegal parking. Additionally, the junction 8 coast-bound entrance slipway, which is currently closed, has had CCTV infrastructure installed. The department is assured that Highways England is doing everything it can to reduce the risk of accidents.

[Baroness Scott of Needham Market (LD)]

My Lords, of the existing places where the vehicles are going to be checked, one is very close to the Port of Dover and the second is very close to Eurotunnel, with the danger that they will themselves generate enough congestion to trigger Operation Brock when it might not have been necessary. What other locations are being considered and when might we expect them to open?

[Baroness Sugg]

My Lords, of course we aim to ensure that all movement through ports will continue to be as frictionless as possible in a no-deal scenario so that the effects on businesses using the Port of Dover and the Channel Tunnel are minimised. To achieve this, our modelling for roll-on roll-off freight moves the customs processes away from the border. Furthermore, in early February HMRC announced transitional simplified procedures, which will help businesses using those facilities. But, as I say, we are working hard to mitigate any disruption caused by additional checks.

Buses

Baroness Scott of Needham Market Excerpts

Thursday 8th March 2018 Grand Committee

[Baroness Scott of Needham Market (LD)]

I thank my noble friend Lord Bradshaw for tabling today’s debate and for being so effective in keeping the woes of the bus industry on the agenda because buses tend to get overtaken by railways.

Like the noble Earl, I shall use my time to speak about rural bus services in England, where there is a particularly intractable set of problems. Last year, when the Bus Services Bill was going through this House, rural issues were raised quite a number of times. The Minister, to his credit, was forced to admit that not enough attention had been paid to the potential benefits that could come from the Bus Services Act if it was implemented in the right way. I know we are not so far on, but it would be very interesting to hear from the Minister what work is going on in the department to make sure that rural areas are not forgotten. During the passage of the Bill, we talked about the way in which the commissioning process could use the Public Services (Social Value) Act criteria to level the playing field with social and community providers of transport. That was something the Minister was quite responsive to, so I would like to hear a little more about that.

I shall make two points which at one level are rather obvious, but which are not always well understood. First, there are different sorts of rural areas. The village I live in in Suffolk is tiny. There are about 200 people in the parish, and it has never had a regular bus service. People stay there only if they have access to a car, and community transport plays an important part for a very small number of people with particular needs. A mile away is a village 10 times the size, which is a completely different kettle of fish. It has always had a very good bus service. People moved there knowing that they had access to the nearby market town and then onwards to Ipswich and Bury St Edmunds. The service has undergone successive contractions and it is now getting harder and harder for people to use the bus to get into work, or to hospitals and other places. These are both rural communities but they have very different expectations and needs.

The second point is that it is convenient to think about rural and urban areas separately, but of course they are inextricably linked. The overall health of the bus industry, as we heard from my noble friend Lord Bradshaw, is very bad, and if it is bad overall, it is dire in rural areas. We have to understand that they are linked. Also, there is the congestion problem: given that most rural journeys might originate in a rural area but are going to an urban area, they are also impacted.

The CPRE has recorded that supported mileage by local authorities has fallen by 24%. It is using the term, “the Beeching of the buses”. Many of them are in rural areas. It is quite illuminating that the Campaign for Better Transport worked out that the total of those lost grants is £225 million in England. That is a lot of money for local authorities, but in government terms, it is the cost of a single bypass. It represents 17% of bus journeys but the ones that are the most socially necessary for some groups.

In 2016, this House published a report on the way in which the Equality Act is being delivered. There was a particular strand of evidence from users about the way in which local authorities fail to do proper impact assessments when they are making decisions about bus provision. As a consequence, a number of groups now face very real problems, which are bad enough if you are in an urban area—in a rural area, it is hopeless. Many older people are unable to drive and depend on public transport. Reimbursement of the bus pass is not keeping up with the costs and, in any case, in many places there are no services on which to use a concessionary pass. In some areas, including my own, a switch to community transport schemes is all very well, but the local authority has used the licensing regime of the buses used to deny passengers the use of their concessionary fares pass.

We know that younger people are taking fewer journeys. In an urban area, that is probably quite a good thing, but in rural areas the only practical way for younger people to look for work or attend higher education—or even have some sort of social life—is running a car. I was talking to providers running the Government’s flagship National Citizen Service; they told me that rural transport is a real barrier to participation for many young people and—because the NCS is provided on a county basis—there was a ridiculous situation where students on the Cambridgeshire border were expected to get to Ipswich, which was just impossible by public transport, but could not go to Cambridge, where there is a bus. The delivery of some of these other services really needs looking at.

For jobseekers without access to a car, just getting to job centres is a real problem. There is the iniquity of people being sanctioned when the system lets them down. Then, of course, there are people on low incomes, who are very dependent on buses. In rural areas, because there are no buses, it is more likely that people who really cannot afford to do so are having to run one or even two cars just to get to work and so on. The irony of all this is that collectively we are actually spending quite a lot of money on buses. Between the bus operators grant, concessionary fares, home-to- school transport, the voluntary sector and health and social providers, there is a lot—but it has never been joined up.

I know that the Government have created some pilots under the Total Transport scheme, covering 37 local authority areas. It would be really useful to know a bit about the outcome of the pilots and what lessons were learned. On a linked point, the Campaign for Better Transport and the Passenger Transport Group are keen to see a connectivity fund, which would bring together this expenditure. I look forward to the Minister’s answer and I hope that she understands the very real concerns that are being expressed today about the overall state of the bus industry, particularly in rural areas.

Bus Services Bill [HL]

Baroness Scott of Needham Market Excerpts

Ping Pong (Hansard): House of Lords
Tuesday 25th April 2017 Lords Chamber

[Baroness Scott of Needham Market (LD)]

My Lords, I thank the Minister for listening to and taking away the concerns I raised with my noble friend Lord Shipley on independent audit. It is an important point. These schemes, however welcome, are potentially extremely expensive. The risk, as always, will fall on local council tax payers and therefore robust independent audit is key. We look forward to seeing the regulations and guidance as they emerge.

[Lord Whitty (Lab)]

My Lords, I remain generally supportive of the thrust of the Bill, but I have been dismayed by some of the measures taken by the Government in the Commons with some of the amendments in this group and others. It is regrettable because during the process of the Bill in this House there has been a high degree of consensus and the Minister has been very helpful in a number of respects. However, in some areas he has been chopped off at the knees by his colleagues steamrolling it through the House of Commons.

I echo what the noble Baroness, Lady Randerson, said on the low emissions provisions. If the Government were concerned about the timescale and the economics, they could have amended the timescale and put in a few qualifications. Instead, they have deleted the requirements in Amendments 2 and 6 that new vehicles should meet new low emissions standards. This is a very poor signal. As the noble Baroness said, it comes a day or two after the Government’s attempt to use the election to defy the previous court injunction that a new air quality strategy should be produced because of the inadequacy of their earlier air quality strategy produced by Defra.

The Government’s record on this is shaky and they are extremely vulnerable. Buses are one of the main diesel-based pollutant vehicles in many of our towns and villages. There was an opportunity to put in the Bill that we would do what a number of local authorities in London and elsewhere are already doing and replace those buses immediately when a new vehicle is brought on with one with high-quality emissions standards. As I said, we could have put in slightly different dates and slightly greater qualifications, but nevertheless that needed to be in the Bill. It undermines the Government’s commitment to do something about air quality on which they have been and will continue to be widely criticised. I regret that and I think the Government will come to regret it too. As was said in this House yesterday by my noble friend Lady Nye, it is a major public health issue. There are provisions for avoiding the purdah prohibitions concerning air quality that were already in the Bill when it reached the Commons. The Government chose, wrongly, to delete those provisions, and I regret that profoundly.

I also regret the deletion or dilution by Amendments 3, 4 and 13 of the provisions we inserted in this House that worker representatives in the bus industry should be clearly consulted on any changes, whether an advanced quality partnership or the new franchising operations. The Minister has continued to make positive noises in that respect, and I appreciated his acceptance of the principle in our earlier proceedings. However, his colleagues seemed to have deleted most of that, which is a mistake. We are talking here, whether the Government like it or not, of a pretty highly unionised sector where by and large there are good relations between the bus companies and their employees. Anything which deletes a continued commitment to those outcomes makes some of these provisions more problematic when they never needed to be. Again, the Government may live to regret that; I hope not. I know that the unions intend to be constructive and by and large welcome the objectives of the Bill, but from a long list of those who are required to be consulted about these changes, the people who are omitted are the ones who actually drive and operate the buses. That seems to me a triumph of ideology over common sense and the Government should not have done it.

The Minister will no doubt be relieved to hear that I intend to intervene only once on this Bill. I have some concerns about the third group of amendments in relation to the reinstatement of the clause which prohibits local authorities from setting up their own companies. That is a restriction on local authority strategic decision-making. I do not intend to belabour that point because we will come on to it in a moment.

I hope that the outcome of the Bill is positive. It is regrettable that these changes have been made by the Government at this relatively late stage because they make it more difficult to achieve what the Minister himself set out as the objectives when he introduced the amendments. Taking the changes together, I hope that in the coming weeks the population will recognise that even in this relatively minor area of legislation the Government have decided, contrary to what was a pretty consensual view in this House, to delete commitments on environmental standards, commitments on the rights to representation of workers, and commitments on flexibility and devolution of powers to local authorities. All of that amounts to an unnecessary and significant reduction in my enthusiasm for what in general is a positive Bill.

Bus Services Bill [HL]

Baroness Scott of Needham Market Excerpts

3rd reading (Hansard): House of Lords
Wednesday 23rd November 2016 Lords Chamber

[The Deputy Speaker (Lord Faulkner of Worcester) (Lab)]

It may be for the convenience of noble Lords if I remind the House that we are debating government Amendment 1, and the noble Lord, Lord Bradshaw, has been speaking to Amendments 4 and 5, which are grouped with that amendment.

[Baroness Scott of Needham Market (LD)]

My Lords, I thank the Minister for introducing his amendment, which closely mirrors one that I brought forward in Committee what seems like quite a long time ago. The success of the Bill will to a very large extent be determined by the attitude of the Competition and Markets Authority. In its advice to government, it has made it clear that it sees this form of franchising very much as an inferior form of competition compared to on-road competition. That is an attitude I find extraordinary. After all, we do not have on-road bin collection competition, with companies whizzing around fighting over who collects the bins. We accept that, under those circumstances, it is a perfectly rational thing to do—and there is absolutely a case to be made with buses. The problem is with the insistence that it must be the only way, which is likely to prove a hurdle that most local authorities will simply not be able to reach. I am very keen that this amendment should go through, not because it can do anything to halt the CMA but because if it is cited at an early stage and then has a problem, at least it will become clear to the franchising authority very quickly. That authority would not spend a huge amount of money on developing a scheme that is likely to fall foul of the CMA later.

--- Later in debate ---

[Lord Deben (Con)]

My Lords, would it be better not to agree this amendment because of the reasons adduced by my noble friend? At the same time, taking up what the noble Baroness said, there is a growing understanding in society that we have to provide people with the opportunity to report things that worry them in a way that does not endanger their position as, for example, drivers. I do not think that this issue is about buses; it is about the society in which we live. We need to enable people in a complex society to issue warnings so as to increase levels of safety. Therefore, I hope that my noble friend will refuse to accept the amendment, which I think would be otiose and rather heavy-handed in this excellent Bill.

I also hope that he will take on board the principle that we should offer people the opportunity to issue warnings whenever we can. If we do not do that, all sorts of things that could be avoided are not avoided. It is becoming less easy to draw a distinction between buses and trains. What do we do with guided bus routes, for example? Are the vehicles classified as trains or buses? We have talked about trams, but the noble Baroness could not tell us whether the same rules operate on trams as operate on buses. We have to recognise that this issue is more complicated than we think, but it is most important that we give people the opportunity to warn in a way that does not imperil their jobs.

[Baroness Scott of Needham Market]

My Lords, I support the approach taken by my noble friend Lady Randerson and I echo the points that have just been made by the noble Lord, Lord Deben. Right across society we are gaining a better understanding that the first indication that something is wrong in an organisation usually comes from the people who work in it. The importance of a whistleblowing policy is well understood. Surely the purpose of this proposal is not necessarily to look back following an accident but to prevent accidents happening in the first place.

[Lord Kennedy of Southwark]

My Lords, the amendment in the name of the noble Baroness, Lady Jones of Moulsecoomb, would insert a new clause into the Bill. We discussed this on Report and I am very pleased that it is back here today to be considered further at Third Reading.

As we have heard, the amendment is about safety. A scheme similar to what is proposed here operates in London and in the rail and aviation industries. Schemes for the confidential reporting of incidents are already up and running, contributing to the safety of everyone in those industries and the passengers who make use of those transport services. Therefore, in principle the noble Lord, Lord Ahmad of Wimbledon, and his department should have no reason not to accept the amendment.

We have heard about the number of fatalities and serious injuries that have taken place in the past year in the bus industry, and anything that contributes to a reduction in those figures should be welcomed by everyone. Publishing the information and identifying bad or sloppy practices, or something that is an unintended consequence, means issues can be highlighted and action taken to deal with them, if we have the data necessary to identify the problem.

It is also a well-known fact that just having a system of confidential reporting can do much to improve the safety culture. Amendment 2 is a very positive amendment and I congratulate the noble Baroness for bringing it back again today. I very much hope that she will get a positive response from the noble Lord, Lord Ahmad of Wimbledon, as she is seeking to bring forward a sensible and proportionate measure that is already operating in other transport industries and in the bus industry in London—and all the large bus operators that operate outside the capital also operate in the capital.

Doing everything we can to avoid death and serious injury in an industry that transports millions of people around every day, often on short local journeys, is something we should all want to support. The costs are not great for operators and, as we have seen in London, the system clearly can operate without any great burden to the industry.

In conclusion, the amendment as worded may not be what is needed, but, as the noble Baroness, Lady Randerson, said, the Government can accept the principle and work with noble Lords in this House and with campaigners to get it right. As the noble Lord, Lord Deben, said, we need to enable people to have the ability and opportunity to warn of potential problems. I think that that is very important and I hope the noble Lord, Lord Ahmad, will move forward on that basis.

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[Baroness Jones of Moulsecoomb]

I do apologise. I have no idea about that. Perhaps you would like to give me a seminar afterwards.

The noble Earl, Lord Attlee, questioned whether or not he was consistent between my bringing the amendment last time and now, I can assure the noble Lord that he was completely consistent. He did not like it then and he does not like it now.

I thank the Minister for the productive meeting and it was good to hear that he was sympathetic to the issues. This is a relatively minor change. Other people have called it heavy-handed but it is a minor change. It saves lives. I cannot think of a higher, nobler cause than saving lives—especially those of the people we purport to govern. We are saving lives and preventing injuries and devastation to families—and the numbers we are talking about are not inconsequential. This is a relatively light touch for something that has such heavy consequences. I am of course disappointed that the Government have not snapped up the amendment but I look forward to it being picked up later.

Its impact on society and on the taxpayer is much heavier than we realise. Every crash has a cost—whether it is in delays to business, to the service or to commuters—that we do not assess. When we talk about the cost to industry, we should also think about the cost to the life of the towns, cities and roads where it happens.

[Baroness Scott of Needham Market]

I appreciate the noble Baroness giving way. Does she agree that one of the key duties on any board of directors is the management of health and safety? It is a legal requirement, so it is inconceivable that bus operating companies do not already collect this information. What we are talking about here are two things. The first is the matter of transparency in reporting and the second is the further step that the noble Baroness wants to take in terms of it being a barrier to granting a franchise. But the point about collecting data is that companies will be doing that already because they are legally obliged to do so.

[Baroness Jones of Moulsecoomb]

I thank the noble Baroness, Lady Scott, for that comment. I actually do not know the answer to that and I will find out.

I hope that the economic impact of deaths and injuries will be taken into account by the Government when they assess the importance of this amendment. Having said all that and feeling only slightly better—I mean bitter—I beg leave to withdraw the amendment.

Bus Services Bill [HL]

Baroness Scott of Needham Market Excerpts

Report: 2nd sitting (Hansard - part two): House of Lords
Monday 24th October 2016 Lords Chamber

[Lord Ahmad of Wimbledon]

My Lords, I certainly agree with the noble Baroness that local bus services act as a lifeline to many and have a real community worth, as we have said previously.

The amendment would, in effect, require operators who are planning to cancel a service to continue to operate that service for a period of six months. As I have said previously, this is likely to be to the financial detriment of the operator or the local transport authority. It would also require a traffic commissioner, whose primary role concerns road safety, to take a decision on the value of a service to the local community. A six-month moratorium on cancelling a service would apply only where a service is stopped rather than varied. An operator who wished to avoid the moratorium could reduce a regular bus service to one that operated very infrequently. Operators of registered bus services are already obliged to give at least 56 days’ notice of their intention to cancel or vary a bus service to a traffic commissioner.

Clause 18 gives the Secretary of State the power to make regulations which will enable local transport authorities to require certain information about a service from an operator who intends to vary or cancel the service. It is designed to enable local transport authorities to obtain information which they require and which will allow them to respond more effectively to the needs of bus passengers. The information they will be able to obtain can be used, for example, to inform the procurement of a replacement service by the authority or to assist community transport operators in designing new alternative services.

It is the responsibility of a local transport authority—not a traffic commissioner—to determine what bus services a local community needs. That is why the Government cannot support the amendment.

I appreciate that many local authorities are facing funding issues and have difficult decisions to make about the services they may be able to subsidise. However, there is more than one option open to them. The community transport sector already plays a vital role, as we have all recognised previously, in the provision of local bus services, often with little or no government funding. Community transport operators will be well placed to serve more isolated communities and my department continues to be extremely supportive of that sector.

As noble Lords may be aware, we recently launched a second round of the community minibus fund to provide new vehicles for community groups. The first round of this initiative is providing new minibuses now to more than 300 local groups across England. I also remind noble Lords of the Total Transport initiative, which supports the integration of services commissioned by different agencies, allowing funding to be used more efficiently and better services to be provided to passengers.

I hope it is clear from the case I have outlined that the Government believe in and understand the importance and value of community local bus services and are keen to find ways to ensure that vital bus links continue to be provided. Given the practical examples I have illustrated and the reassurance I have provided, I hope the noble Baroness will feel able to withdraw her amendment.

[Baroness Scott of Needham Market (LD)]

The Minister referred to the new community transport schemes and the investment in new vehicles. Can he give an assurance that they will be of a size that is legally encompassed within the concessionary fares scheme? This would avoid the problem that we have in Mid Suffolk where the new community transport scheme is using vehicles that are too small to come within the concessionary fares scheme. We have many elderly people with concessionary fares passes but no vehicles on which to use them.

[Lord Ahmad of Wimbledon]

If the noble Baroness will write to me about that case, with which I am not familiar, I will respond in writing to both the specifics and the general point.

Bus Services Bill [HL]

Baroness Scott of Needham Market Excerpts

Report: 2nd sitting (Hansard - part one): House of Lords
Monday 24th October 2016 Lords Chamber

[Lord Judd (Lab)]

My Lords, I did not participate when this group was debated last week. I put forward this amendment because I wanted the opportunity to debate it properly today.

I very much welcome the amendments that the Minister made to Clauses 1, 4 and 9, that will require local transport authorities to consult neighbouring national park authorities when preparing franchising or partnership schemes. I thank him and his officials for so readily listening to the concerns and taking on board the points raised about the importance of national parks authorities being listed as statutory consultees, and putting that in the Bill.

I also very much welcome the amendment the Government tabled to Clause 7, which adds national parks authorities as statutory consultees for advanced ticketing schemes. This should ensure that there is more opportunity to include routes serving national parks in Travelcard and other joint ticketing arrangements. Providing a national parks authority with more opportunity to influence all these schemes will help ensure that the needs of both residents of and visitors to these areas are taken into account, and will contribute to ensuring that these beautiful areas are accessible to everybody and not just those with a private car. They also have the potential to contribute towards combating traffic congestion which threatens to spoil the parks and to undermine their purposes. This is particularly important in light of the Government’s aspirations, as set out in the eight-point plan for national parks, to see more people gain from the health and well-being benefits offered by these inspiring areas.

Overall, it is good to see the progress made to this part of the Bill. However, I still have this further amendment, which relates to ensuring that LTAs consider the impact on NPA policies when assessing proposed franchising schemes. We all know that NPAs are, obviously, not local transport authorities but they have played a key role in delivering bus services in recent years and their core strategies contain relevant policies relating to transport and access which should be taken into account when preparing franchising schemes. For example, the New Forest National Park Authority’s core strategy includes policy on access to promote safer access and more sustainable forms of transport to, from and within the national park, and specifically refers to support for the New Forest Tour bus services.

It is essential that the impact on such policies is considered when assessing proposed franchising schemes. The amendment I propose to Clause 4 should ensure that this happens. I hope that, even at this late stage, the Minister could give this further consideration before we come back to the final stage of the Bill. I am very willing to come and see him if he would like me to do that to discuss it in more depth. I hope he will feel able to meet this point as he has so commendably and readily done on the other points raised previously. I beg to move.

[Baroness Scott of Needham Market (LD)]

My Lords, I wish to support the noble Lord, as I did in Committee. I echo his comments about the Minister’s willingness to meet the concerns that we have raised here. However, there is a big difference between consulting—which could frankly just mean writing to the national park authorities and ignoring what they say—and a genuine process of taking into account the work that they have been doing in their areas, particularly in public transport. I hope that in the spirit of the way the Minister has behaved so far, he will take this extra step.

[Lord Ahmad of Wimbledon]

My Lords, I thank the noble Lord for his amendment and the noble Baroness for her contribution. The amendment would make national park authorities relevant authorities as far as new Section 123B is concerned. As the noble Lord pointed out, this section deals with the business case and primarily concerns the authorities that will be making a franchising scheme with transport powers.

I would like to clarify where we stand on this point and on the question that the noble Lord raised. To be clear—I hope this gives a level of reassurance to the noble Lord—the Bill requires the franchising authority to think about the impacts of bus franchising on neighbouring local transport authorities, and this should ensure that cross-boundary services are carefully considered. Regarding his point and that of the noble Baroness on the business case, the provisions we have already made in the Bill will ensure that any authority looking to proceed down this line will pay due consideration because it is now a statutory requirement. I therefore feel that the Bill has been strengthened to reflect the noble Lord’s concerns.

I am always happy to meet with the noble Lord to further understand elements that he wishes to raise. I think the guidance is playing an important part in this and while we have included national parks specifically when it comes to franchising in terms of the actual statutory consultee, we will also bring notice to appropriate authorities when they are considering the overall proposal in the first place. I hope that with this assurance—and I always welcome meeting with the noble Lord—he will at this juncture be minded to withdraw his amendment.

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Moved by

[Baroness Scott of Needham Market]

28: Clause 4, page 16, line 26, after “an” insert “independent”

[Baroness Scott of Needham Market]

My Lords, Amendment 28 returns to the question of an independent audit of proposals for new franchising schemes. I thank the Minister for meeting me in September to discuss this matter and for his subsequent letter. The purpose of the amendment is to provide the House with an opportunity to look again at the question of an independent audit and for the Minister to elaborate and build on the letter that he sent me.

The issue here is protecting the public against the careless use of local taxpayers’ money. I have always believed in devolution; indeed, I have long thought it was a scandal that our major cities constantly have to go cap-in-hand to government whenever they want to undertake a capital programme. But I am also a great believer in democratic accountability, and there is a real problem in mayoral models in that the very concentration of power in the hands of one individual that makes it such an attractive option to government also runs a significant risk of poor decision-making because it is untested by debates in traditional committees or through effective scrutiny.

The Public Accounts Committee published a report in July in which it said:

“There has been insufficient consideration by central government of local scrutiny arrangements, of accountability to the taxpayer and of the capacity and capability needs of local and central government as a result of devolution”.

The committee went on to talk more about its concerns about capacity issues, particularly financial and technical skills, which have been exacerbated by budget cuts. Providing a requirement for a mayor to give information that proposed new schemes, potentially worth millions of pounds, have been independently audited is an important safeguard. The auditor usually engaged by a local authority may very well have their independence compromised by their wish to hold on to the contract.

Equally importantly in terms of public confidence is that the audit should be seen to be independent. The Public Accounts Committee had this to say:

“Robust and independent scrutiny of the value for money of devolved activities is essential to safeguarding taxpayers’ money, particularly given the abolition of the Audit Commission … Currently, local auditors focus on individual bodies’ financial statements and arrangements for securing value for money, rather than assessing value for money itself”.

In his letter to me, the Minister referred to the guidance on the matter that he had agreed to develop, and I would be grateful to hear more about that today. He referred to the availability of freedom of information as a means of achieving transparency. I wonder whether he can confirm today that such freedom of information requests will not be met with commerciality exemptions. I beg to move.

[Lord Shipley (LD)]

My Lords, I support this amendment, to which my name is attached. My noble friend Lady Scott of Needham Market said that it related to the protection of the public, and I agree entirely with all that she said. I draw the Minister’s attention to the fact that the context is not the same as it was when we debated this matter in Committee, because an amendment was agreed on day one of Report extending franchising powers to all relevant councils and local transport authorities. I supported that in the Lobbies but I have always believed that it must be accompanied by a robust and thorough audit and full scrutiny of any proposal for franchising.

Detailed audit and scrutiny processes exist within mayoral combined authorities because this House wrote into the Cities and Local Government Devolution Act much more comprehensive arrangements for audit and scrutiny than had originally been planned. As my noble friend Lady Scott of Needham Market made clear, it is not as much as we wanted, and many feel that it is not enough—but it is, nevertheless, more than is proposed in the Bill for non-mayoral combined authorities.

I hope that the Minister will give much further consideration to the proposal that there should be full scrutiny and audit of any franchising plan proposed by a council or local transport body which is not a mayoral combined authority. My noble friend Lady Scott received a letter from the Minister dated 5 October which expresses much agreement on the need for the audit process to be credible and open to public scrutiny, and accepts that there must be robust evidence and analysis. Indeed, on page 2 the letter accepts that the process should be independent, and one in which other people will have the right to challenge the report. Clearly the process must be seen to be transparent.

We need an auditor with appropriate professional standing who is clearly independent of the contractor and also has professional knowledge of audit, finance and, crucially, transport. I suggest to the Minister that it will be a rare person indeed who, as auditor to a council or a local transport body, has all those skills. It is my view that a specific appointment should be made.

I accept that this matter could be subject to further discussion during the passage of the Bill and then in the production of guidance—but, now that the House has extended franchising powers to non-mayoral combined authorities, having a robust and independent audit system has become increasingly important.

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[Lord Ahmad of Wimbledon]

Again, I do not think I can give a blanket assurance. The auditor is there to see that due process has been followed, and that decision will be subject to public scrutiny. Any auditor is there to do a job and will do it to professional standards. I hope that, based on the assurances I have given, the noble Baroness is minded to withdraw her amendment.

[Baroness Scott of Needham Market]

I thank noble Lords who have spoken in the debate. Their response suggests that I was right to return to this question, and indeed the Minister’s response would also suggest that I was right to do so. There is widespread agreement that this is a difficult issue. Of course, it is not just about a potential loss of taxpayers’ money if the scheme goes forward. These schemes are extremely expensive even to start developing, so it is essential that local authorities have sound financial advice all the way through about the financial viability—and, given the relationship with the Competition and Markets Authority, about the legal liabilities—before they embark down this route.

On the question of freedom of information, although I understand that each application has to be treated separately, there are exemptions in the legislation for commercial agreements. My nervousness is simply caused by the fact that every time someone asks questions about a potential franchising scheme, they receive a blanket, “No, we can’t talk about that because it is commercially sensitive”. I am not sure that I would put the same reliance on freedom of information as a transparency tool in this case as the Minister does. Nevertheless, I am confident that he has taken the issue seriously and that his officials are working on the guidance and with local authorities and auditors—so I thank him and other noble Lords for that and I beg leave to withdraw the amendment.

Amendment 28 withdrawn.

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[Baroness Jones of Whitchurch]

My Lords, in moving Amendment 39, I shall speak also to Amendment 73. These amendments would require those opting for a bus service under franchise, and those developing enhanced partnership schemes, to apply the principles of the Public Services (Social Value) Act 2012 when determining the type of service to be commissioned.

As we discussed in Committee, the social value Act recognises that public services can play a transformative role in communities. Rather than simply opting for a narrow definition of value, 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, particularly on a combined-service basis, 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; or it could include a number of apprenticeships and work experience places for young people; or it could include a commitment to support an existing community bus service, perhaps with some shared facilities; or it could include an environmental plan with targets for green energy and reduced CO₂. Of course these are just examples, but the point of social value in this context would be to encourage bus operators to commit to their own added-value measures without costing any more money.

In a letter on this issue to the noble Baroness, Lady Scott, and in our discussion in Committee, the Minister expressed some sympathy with these aims but argued that it would be better covered in the guidance that accompanies the Bill. However, we were disappointed with this response, because the fact is that the social value Act is simply not being embraced in the way that was intended. We believe that it would benefit from being on the face of the Bill to underline the importance of this approach.

As we mentioned in Committee, 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. This is great news. However, the noble Lord, Lord Young, then went on to conclude that the opportunities and advantages were simply not widely enough understood and take-up of the concept was therefore low. This is our opportunity to put this matter right by embedding this approach in the provision of local bus services in the future. However, that will only happen if it sits in the core of the Bill; if it is buried away in guidance notes, as the Government are proposing, it runs the risk of being ignored and misunderstood again in future.

I hope that the Minister will reconsider his position on this and that noble Lords will feel able to support the amendment. I beg to move.

[Baroness Scott of Needham Market]

My Lords, I offer the support of these Benches for the amendment. It would be rather strange if we did not, because the social value Act 2012 was a Private Member’s Bill taken through this House by my noble friend Lord Newby. I raised the question of the use of this Act in Committee, so I am grateful to the Labour Benches for picking this up and transferring it into an amendment.

As we have heard, the social value Act allows public bodies to take a much broader range of issues into account than conventional procurement practices do, so they can think about the environment, community well-being and the local economy. It actually goes one stage further, because the Act makes people think about the considerable financial power of public procurement in an area and is a way of local authorities and local health authorities harnessing their own commissioning power for the benefit of their communities.

As we have heard, the evaluation last year by the noble Lord, Lord Young, was that, while there had been some real success stories, the social value Act was not being used enough and was not sufficiently understood. I have a lot of sympathy with an amendment which puts this on the face of the Bill because it forces commissioning authorities to really think about whether they have given sufficient consideration to this. Overall, it is a way of ensuring that compliance improves.

I was very taken with the conversations I had on this matter with HCT, formerly Hackney Community Transport, which is a social enterprise that provides bus services in a range of areas as diverse as London boroughs and Jersey. It feels very strongly—and made the point to me—that current procurement practices often freeze out smaller businesses. That is a great pity because some of the best bus operators in the country are the small, local ones. It is important to find ways to strengthen this aspect of the Bill and really help local authorities, in their various forms, to make the most of this considerable new power.

[Baroness Randerson]

My Lords, I am very pleased indeed that this duo of amendments has been put down. They link well with Amendment 97, which provides a mechanism for expressing and recognising community value.

I simply add to what has been said already that it is essential that the Government recognise that bus services fulfil a vital social service, especially in rural areas. The knock-on effect of social isolation is far more costly than any subsidy put into bus services. That is why concessionary fares for older people have been so effective. I know that the Government recognise that effectiveness. We should add to that social impact the huge potential contribution of bus services in reducing air pollution, particularly in urban areas. Therefore, it is important that the Minister uses every opportunity in the Bill to emphasise the importance of the social value of bus services in general.