Planning and Infrastructure Bill

Lord Grayling Excerpts

Committee stage
Thursday 24th July 2025 Lords Chamber

[Lord Hunt of Kings Heath (Lab)]

My Lords, I shall speak also to Amendment 91. My noble friend Lady Liddell is not able to be with us today, so I have taken on the mantle of championing carbon capture, usage and storage. Seeing the noble Lord, Lord Naseby, in his place, I hasten to add that I equally would champion the benefits of hydrogen in the future; he has spent the last year telling the House why it is so important.

CCUS, as it is known, is a technology aimed at capturing carbon dioxide emissions from industrial processes, power plants and other sources. It prevents them entering the atmosphere. The captured CO₂ can be reused in various industrial applications or stored permanently in geological formations deep underground. The CO₂ can then be monitored to make sure it is stored securely.

This is a great opportunity for the UK to lead on technology development, and our resource of the North Sea offers huge potential opportunities to store carbon from other countries in Europe. I am convinced that CCUS is safe. It clearly contributes to a low-carbon society and offers great opportunities for growth in our country.

The UK is home to seven major industrial clusters, which produce 50% of all UK industry emissions. The Government, quite rightly, are supporting development of CCUS in those clusters. Deployment in the first two of those clusters is called track 1. The first two clusters were chosen by a process called phase 1, launched in 2021. They are HyNet, in the north-west of England and north Wales, and the East Coast Cluster in Teesside. In October last year, this Government announced that they had made available £21.7 billion in funding for the first CCUS projects in the UK. Looking at the timescale, I recognise that the last Government were very supportive of CCUS as well.

We are at a pivotal moment. The first carbon capture projects in the UK have reached financial close, and the Government are clearly making strong commitments to support deployment across the industrial heartlands, but progress is at risk from outdated or inconsistent planning rules. At present, the treatment of certain CO₂ infrastructure, especially short spur pipelines and capture plants, is ambiguous under the current system. As an example, projects under 10 miles in length do not fall within the nationally significant infrastructure project regime, despite being essential components of major decarbonisation efforts. There are also legacy legal barriers, such as the requirement for special parliamentary procedures under the Pipe-Lines Act 1962 for compulsory purchase of land related to CO₂ pipelines. This process is not required for other comparable infrastructure and risks introducing unnecessary delay.

My two focused amendments seek to ensure that CO₂ capture plants and shorter spur pipelines are designated as nationally significant infrastructure projects under the 2008 Act, and to remove the need for special parliamentary procedure under the Pipe-Lines Act where it applies to CCUS infrastructure. These are very limited but important changes. As the spirit of this legislation—despite much of the debate we have seen so far—is about growing our economy and making it easy to develop infrastructure, I very much hope that my noble friend will agree to have a look at this. I beg to move.

[Lord Grayling (Con)]

My Lords, I rise to support the principle of what the noble Lord is suggesting, but with a “but”, which I hope the Minister will give some careful thought to across the summer before we come back to debates in the autumn. The noble Lord, Lord Hunt, is absolutely right that CCUS is extremely important to this country, needs to be progressed expeditiously and provides an important part of how we deal with carbon emissions in the atmosphere, so he is right to bring forward this proposal. My “but” is more broadly related to the range of types of project covered by NSIP. I declare my interests as an adviser to Hutchison Ports and to AtkinsRéalis.

My concern is more about the implications of more and more categories of project being covered by these processes. The issue I want the Minister to address across the summer, before we come to it in Part 3, is that this legislation, when it comes to major projects of this kind, allows developers to simply move ahead, provide compensation to the fund that the Government are setting up and, in effect, clear a site. I strongly believe that the balance of presumption should be that a developer has a duty to examine what is on a site and to take precautionary measures around the biodiversity on that site before they come to take action away from that site. The more we grant permission to those seeking to pursue major projects simply to move away from any environmental responsibilities, the more damage will be done to biodiversity and our environment.

It is not that we do not need change. I was involved very clearly as Secretary of State in the process of taking the expansion of Heathrow Airport through Parliament six years ago, and there were some issues we faced that were nonsensical around the way the habitats directive was applied and which I think defied all realistic common sense. Change is clearly needed, and I accept the principle of what the Government are doing, but I want to see the precautionary principle left in or put back into the legislation, requiring a developer, whether for CCUS or another kind of major project, to look carefully at what is on a site and at how they ameliorate the impacts before they can simply pay money into a fund and wash their hands of what is on the site. My request to the Minister, as he thinks this through across the summer, is to look at what could be done with the legislation to stop the slash-and-burn approach and to leave us with proper safeguards for nature but also to allow us to move ahead with precisely the kind of thing that the noble Lord, Lord Hunt, is rightly saying we need to do.

[Earl Russell (LD)]

My Lords, I rise to speak to both amendments tabled by the noble Lord, Lord Hunt. On these Benches, we broadly support Amendment 51 and we support Amendment 91. Amendment 51 seeks to amend the Planning Act 2008 to clarify that carbon dioxide spur pipelines and carbon capture equipment are eligible for nationally significant infrastructure project designation. Amendment 91 seeks to directly amend the Pipe-Lines Act 1962 to remove the requirement for special parliamentary procedure in cases where a compulsory purchase order is made for a CO₂ pipeline used for carbon capture and storage. Both amendments, in their different ways, seek to make practical changes to help speed up the building and development of carbon capture and storage projects.

The Climate Change Committee was clear that there is no route to net zero without carbon capture and storage. Going forward, we need this technology, particularly for the hard-to-abate industries such as cement and glass, where we have to capture CO₂.

On these Benches, we support carbon capture and storage. It is a key part of our strategy on climate change and to achieve net zero, and we are committed to accelerating the development of such technologies to help further reduce and control our emissions. Indeed, the UK is in a good place for doing this: we have an estimated 78 billion tonnes of CO₂ storage capacity under the seabed in the North Sea from our old oil wells and as part of that declining basin.

I spent a bit of time last night trying to understand the NSIP system around carbon capture and storage. I must admit that I ended up scratching my head a little, because it is not the clearest thing I have ever read, so the noble Lord, Lord Hunt, has definitely picked up on an important issue. Trying to understand which bits of carbon capture and storage are NSIP and which are not is easier said than done, so we recognise the need for clarity around these points.

My only real worry with the amendment is that the landscape, as it exists now for planning, is complicated. I took particular note of the fact that the noble Lord, Lord Hunt, said that it was a spur of pipelines of less than 10 miles in length, but “less than 10 miles in length” is not in the wording of his amendment. I worry a little bit about whether the definitions the noble Lord has put forward will fit with the existing regulations and that complicated landscape.

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One definition of insanity is repeating the same thing over and over and expecting a different outcome. Launching a major programme of infrastructure and expecting people to speak out when things go wrong while the current whistleblowing framework remains unchanged, or just a bit tweaked here or there, is, frankly, insanity indeed. So I ask the Government to listen and either accept my amendment or find other ways to come properly to grips with the need for safe whistleblowing. I beg to move.

[Lord Grayling (Con)]

My Lords, I listened carefully to the noble Baroness’s comments. I was not planning to speak but, given that I was the Secretary of State alongside the Mayor of London when we had the bad news about Crossrail, I thought I would contribute a thought to this discussion.

First, the noble Baroness is right about many of the issues. What happened in 2019 was a combination of head in sand and a lack of understanding of the complexity of the Crossrail project. It was outrageous that the mayor and I discovered only as late as we did that the project was as far off track as it was. That is the reason I set up the Allan Cook review into HS2 that identified the following spring that the project could not be delivered for the budget that was there. I said clearly, “That’s your budget. You have to deliver it for that amount of money—otherwise, there’s a real question over whether it can happen at all”.

Although the noble Baroness makes an important point, equally we have to remember the problem of disaffected employees. How do you deal with a whistleblower who has a separate agenda—somebody who has been dismissed, somebody who is unhappy at work and so forth? I am not convinced that setting up a separate agency is the right way to deal with what she is suggesting, but she is making a salient point. There probably needs to be a much earlier mechanism to raise a danger flag about a project that is not going the way it should, because there is a reluctance to tell truth to power. In these projects there is an optimism bias and always a feeling that, “Well, something will come along to bring it in okay after all”. I suggest to the noble Baroness and to Ministers a possible route for NISTA, the new infrastructure body, to have some form of investigatory role. If somebody says, “This project appears to be going badly wrong” early on, that might be a better way of doing it than setting up a separate body altogether.

The reality is that the mayor and I should never have been in the position we were in of discovering so late in the day about a project that we had been told clearly was on track and was going to open, with the first trains running the following December. The noble Baroness makes a valid point in saying that there should be safeguard mechanisms in the system, but the mechanisms that should exist are probably best handled through the national infrastructure bodies than through a separate organisation in its own right.

[Lord Hunt of Kings Heath (Lab)]

My Lords, I am very sympathetic to what the noble Baroness said but, rather like the noble Lord, Lord Grayling, I am not sure that another statutory body is the right way to deal with this. Thinking back to my experience in the NHS, I cannot think of the number because there have been so many whistleblowing initiatives. There have been edicts and circulars, and I think we have some legislation as well. But I think we would find it hard to say that we think the NHS has a culture in which whistleblowers feel confident to come forward; they do not.

The noble Baroness has raised an important question, which I hope the Government will consider. We need to start talking to the leaders of organisations to understand what the issue is in relation to whistleblowers. It is, of course, partly the point that the noble Lord, Lord Grayling, raised; sometimes whistleblowers can be awkward people and therefore have already built up a feeling against them. Sometimes they could be making trouble, but very often they are raising legitimate points.

Part of the problem is the punitive culture for senior managers in much of the public sector. Why do NHS chief execs discourage whistleblowing? It is because we have a punitive culture. The turnover rate of CEOs in the health service is frightening; it is so rapid. Somehow, to deal with whistleblowing, you have to look at a much wider issue of whether we set conditions in which leaders have greater freedom to develop and grow their organisations from the current micromanagement they often come under. We also need a culture in which, if CEOs really do encourage their staff to raise concerns, the system then does not come down.

There is clearly a tension. I am sure that many CEOs know that, in their hospital trusts at some point, there are unsafe services. They know they do not have enough clinical staff. The penalty for admitting it, however, is to have regulatory intervention and managerial intervention from above which basically says, “You get on with it. We are much more concerned about finance and throughput”. Unless we are realistic about why senior management does not encourage whistleblowers, the reality is that any of these kinds of initiatives will not be effective in the end.

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[Lord Moylan (Con)]

My Lords, we come to a series of amendments that relate to transport and the Department for Transport. If I may, I shall begin with a few preliminary remarks. The first is to apologise to noble Lords that I did not speak at Second Reading on the Bill—I was not able to. The second is to thank the Minister and his officials for the engagement and the helpful meetings and briefings that I had in preparation for today. Thirdly, as a class, the amendments relating to the transport section of the Bill are generally very trivial and minor indeed. If this is the Government’s engine for growth, there is not a great deal of puff in it. One of the amendments—I doubt we will discuss it—is so bold as to repeal a redundant clause in the Transport and Works Act. For those of us with a tidy mind, that is not a bad thing to do, but it will hardly shake up the economy. None the less, the Government’s amendments deserve a degree of scrutiny and we shall attempt to do that in the course of the next few hours.

I turn first to amendments relating to Clause 29. As well as moving Amendment 53C standing in my name, I will speak to Amendments 53D, 53E and 53F. I shall also speak to Amendment 53M, which relates to a later clause in the Bill. What these amendments have in common is that they relate to charges. Clause 29 creates a category of legal person known as “prescribed authorities”, which are not named. These prescribed authorities will be able to charge highways authorities for their services, but the services that they will be charging for are not specified either. All this is to follow in regulation. One can hazard a guess that the sort of body that might be a prescribed authority for this purpose might be Natural England or the Environment Agency, or whatever.

My first question, and the purpose of the first few amendments, is to elicit from the noble Lord what these bodies are. The second is to try to establish what range of services they are going to be able to charge for, and whether services that are currently regarded as routine and freely available will now become a charge on highways authorities. I would also like to know whether, in setting the charges, they will be limited by the very common principle among public authorities that charges should be set only so as to cover costs, and that taking one year together with another they do not generate a surplus. Will that be the case in relation to these charges or not, and if not, what limit will be placed on their ability to set those charges?

My final question is a slightly detailed one for those who are involved with local authorities that are also highways authorities. Could the payment of these charges by highways authorities fall upon a parking revenue account and be drawn from a parking revenue account, or would it fall on the general fund? It would be helpful if the Minister could tell us that as well.

Briefly on Amendment 53M, this relates to a clause which allows highways authorities to charge applicants—this is, if you like, a mirror image, or may be to some extent a pass-through clause. It is not objectionable in itself, but there is again the question of whether these charges will be set so as to cover costs and so that a surplus is not generated, taking one year with another. I think it would be very helpful to all noble Lords if the Minister could answer those questions. I beg to move.

[Lord Grayling (Con)]

My Lords, very briefly, I support my noble friend in this probing effort to establish what the intention of the Government is. He is right to highlight the risk that this becomes a revenue-raising mechanism as opposed to a cost-offsetting mechanism. There have been many examples over the years where different public bodies have sought to do that, and he is right to seek clarification.

The one caveat I would add is that there may be some cases where it is right to levy a punitive charge, where there has been a failure on the part of the third-party body that is being charged, but that should be under only very limited circumstances and where there has been a palpable and measurable failure in what that organisation has done; for example, a lane rental that has been put in place to carry out works that have been done inadequately, leading to disruption afterwards. My noble friend is absolutely right to ensure that the Government are clear about whether these measures will allow profits to be made or whether they are simply to offset costs. I look forward to hearing the Minister’s answer.

[Lord Liddle (Lab)]

My Lords, I speak briefly to make an apology. I have Amendment 71 in a later group, but I have to catch an Avanti train to Carlisle—and that, as my noble friend Lord Hendy will know, is a bit of a hazardous process these days. So I probably will not be here for the amendment that I have tabled, but it is relevant to the point about charges, because it is an amendment about trying to liberalise the regime, to enable people who cannot park their electric car off the road to charge from their home across the pavement. That will cut bills for people by a considerable amount. Lots of profit is being made somewhere in the provision of on-street charging systems, and enabling people to charge their car from their own home would be a pro-environment measure in increasing the attractiveness of electric car ownership but also a cost of living measure, to which I hope the department will give consideration. I apologise again if I am not around when this matter is discussed.

--- Later in debate ---

[The Minister of State, Department for Transport (Lord Hendy of Richmond Hill) (Lab)]

My Lords, the first three amendments in this group seek to ensure that the fees charged by the prescribed bodies to highways authorities under the Highways Act 1980 are not excessive, that the level of fees charged does not cause highways authorities financial hardship, and that the regulations detail financial mechanisms and arrangements to support highways authorities in meeting any charges that may be forthcoming under Clause 29. I welcome the noble Lords, Lord Moylan and Lord Grayling, raising points related to the public purse. The ability of organisations to plan and fund resources accordingly is important to the successful implementation of these reform measures.

Clause 29 is an enabling power that allows the Secretary of State in England and Welsh Ministers in Wales to make provision for, through regulations, the charging of fees for services provided to support Highways Act 1980 applications. I underscore that Clause 29 is intended only to allow prescribed bodies to charge fees on a cost-recovery basis. Its implementation, through supporting regulations, will not allow them to make a profit. The ability to recover reasonable costs will support the capacity and capability of specified public bodies. This in turn will encourage timely and high-quality inputs into the process.

As in other infrastructure consenting regimes where cost-recovery principles have been introduced, the regulations will be used to set out that fees may not exceed the costs reasonably incurred in providing the relevant services. The clause states that the regulations may make provision in respect of

“what may, and may not, be taken into account in calculating the amount charged”.

This provides a satisfactory basis on which to achieve the intention of the amendment. As part of stakeholder engagement, the Government will rightly continue to engage to understand the potential financial implications for highways authorities, prior to introducing regulations. The Government believe that, taken together, our commitments to produce statutory guidance alongside the regulations will ensure that the fees charged by prescribed bodies are done only on a cost-recovery basis and will provide appropriate flexibility in the light of changing circumstances to review and adjust fees where necessary and justified.

In respect of transparency, local authorities are already under a duty to maintain a system of internal audit and to appoint external auditors to audit their accounts annually. Government departments and their non-departmental public bodies in England are audited by the National Audit Office on behalf of the Comptroller and Auditor-General. The Welsh Government and their non-departmental public bodies in Wales are audited by Audit Wales on behalf of the Auditor-General for Wales. The department allocates capital funding to local highways authorities so that they can most effectively spend this funding on maintaining and improving their respective networks based upon their local knowledge, circumstances and priorities. It is therefore for the respective highways authorities to determine how best to spend this funding to fulfil their statutory duty under Section 41 of the Highways Act 1980.

Precedent from other regimes with cost-recovery principles directs that the matters identified in the proposed amendments can be satisfactorily addressed through secondary legislation and guidance. In so doing, that will provide suitable flexibility for the operation of a cost-recovery regime in the event of changing circumstances.

The points proposed in the noble Lord’s Amendment 53F are important. It is the intention, as in other transport-consenting regimes with cost recovery, that they will be addressed through secondary legislation. The regulations will, among other things, explain how fees should be calculated and when fees can and cannot be charged, as well as specify which bodies can charge fees.

I turn finally to Amendment 53M. Clause 40 is an enabling power that allows the Secretary of State in England and Welsh Ministers in Wales to make provision through regulations to charge fees for services provided to support Transport and Works Act applications. As in other infrastructure-consenting regimes, where cost-recovery principles have been introduced, the regulations will be used to set out that fees must not exceed the costs reasonably incurred in providing the relevant services. These regulations will detail not only the bodies that will be able to recover fees but the basis on which fees should be calculated. The regulations will also consider circumstances in which fees may or may not be charged and when these fees may be waived or reduced.

Taken together, the Government believe that our commitments to produce statutory guidance alongside regulations will ensure that fees charged by prescribed bodies are done only on a cost-recovery basis and provide appropriate flexibility in the light of changing circumstances to review and adjust fees where necessary and justified.

The noble Lord, Lord Moylan, asked what the prescribed bodies are. I am happy to write to him to set out which bodies the Government have in mind. The sorts of services that might be included are, for example, providing advice on significant adverse effects on the environment and mitigating those effects. The Environment Agency might, for example, provide advice on surface water flood risk from a new highway and how to mitigate it.

The noble Lord, Lord Grayling, referred to punitive charges in certain circumstances. While I sympathise greatly with the idea that all public bodies should behave in a timely and proper manner, I am not entirely sure that punitive charges ought to be set out in an arrangement that seeks just to make the system work better.

[Lord Grayling (Con)]

It may be that this is not the right vehicle for this, but most local authorities do not have the resource to inspect works carried out by utility companies, for example. As a result, the works tend to deteriorate faster than they should do. Putting in place a punitive regime to enable a local authority to apply fines would provide additional resource for extra inspections. That is something that, in hindsight, I wish I had been able to do and which the current Government could do.

[Lord Hendy of Richmond Hill (Lab)]

I thank the noble Lord for his intervention and I am very sympathetic to his point. He is quite right. He and I both know that, on many occasions, reinstatement works are done badly and do not last long. The recovery of inspection charges to find that out is reasonable; punitive charges beyond those levied for work reasonably incurred are probably not reasonable. This may not quite be the vehicle to do it, but I have every sympathy with what the noble Lord is saying. As he probably does, I inspect pavements and roads almost daily and despair at their condition.

I will deal with my noble friend Lord Liddle’s point on Amendment 71 when we get there, even though he will probably be in transit to somewhere else. I will take away the points about run-off water, which were debated by the noble Lord, Lord Whitty, and the noble Baroness, Lady Pinnock, and reflect on the extent to which they are covered by these amendments.

I thank the noble Lord, Lord Moylan, for tabling these amendments and appreciate his interest in these clauses. However, I ask that he withdraws Amendment 53C.

Rail Freight

Lord Grayling Excerpts

Monday 14th July 2025 Lords Chamber

[Lord Hendy of Richmond Hill (Lab)]

The noble Baroness may know that, actually, that is not a new scheme. In respect of rail freight to Europe, the Government clearly have an interest in promoting it. The Channel Tunnel has plenty of spare capacity, as does HS1. In respect of carrying lorries by rail in the UK, that has been tried before. I think it is up to the private sector freight market to develop its own flows, but the Government are there to help with access and access charges in order to get that traffic on the railway.

[Lord Grayling (Con)]

My Lords, I refer to my entry in the register as an adviser to Hutchison Ports. I looked carefully through last week’s announcement. I could not see anything in the Government’s plans that would deal with the bottlenecks in the system that prevent rail freight growth. Can the Minister enlighten us as to when those might be addressed?

[Lord Hendy of Richmond Hill (Lab)]

The noble Lord has, of course, some background in this subject, but the Government in his time were unable to invest significantly in increased access for freight, and the fiscal position has not allowed as much investment in that area as the Government would clearly like in unconstrained circumstances. Nevertheless, there are investments to be made now in the network which have been announced, such as the investments in the TransPennine upgrade and in East West Rail, which will facilitate more rail freight.

Passenger Standards Authority

Lord Grayling Excerpts

Tuesday 11th February 2025 Lords Chamber

[Lord Hendy of Richmond Hill (Lab)]

We have been working hard to ensure that the new PSA will be a powerful watchdog, making sure that passengers have an independent voice in the industry which stands up for them. It will have increased powers, enabling it to become a strong advocate through holding GBR to account for improving the passenger experience, and particularly for disabled people, as discussed during the passage of the public ownership Bill. The public consultation I referred to will seek the views of the public and industry on the proposed scope and functions of the PSA. After the consultation is published, I will be happy to meet the noble Baroness and other interested noble Lords to discuss it.

[Lord Grayling (Con)]

My Lords, the Government are establishing a passenger standards authority, but Network Rail says that the industry should not use the word “passenger”. Who is right?

[Lord Hendy of Richmond Hill (Lab)]

The document that the noble Lord refers to was actually published during the time he was the Secretary of State for Transport—by Network Rail, I should say—so it is not a recent document. It is advice about writing letters using words of fewer than four syllables, and it is in fact good advice. Much of the correspondence that the noble Lord must have been given in his time as Secretary of State, which I am given as the Minister and which I was given as the chair of Network Rail, was indigestible in practical terms, so a guide for people about how to write letters in simple English is a really good thing.

Bus Services (No. 2) Bill [HL]

Lord Grayling Excerpts

Committee stage
Tuesday 11th February 2025 Grand Committee

[Baroness Jones of Moulsecoomb (GP)]

My Lords, I signed several amendments of the noble Lord, Lord Holmes, and I would have signed those of the noble Baroness, Lady Brinton, which are very good. I speak as somebody who has always loved floating bus islands, because I have no disabilities—other than not being capable of keeping my views to myself—and there seems to be a degree of real safety for cyclists going past them. But, obviously, since we have been discussing this, I have become very aware that floating bus islands are in some quite dangerous situations and difficult places, and I have now changed my mind—which is a rare thing for me to do.

There are probably three reasons for me to support these amendments. First, as the noble Lord, Lord Holmes, said, everyone benefits when we make things safe—that is absolutely obvious. When you have an increasingly older population, as we do in the UK, that is incredibly important. There is also the question of fairness. I want a fair society; I know we are a long way off it, but it really is something we should aim for constantly. Lastly, I have family with invisible disabilities, and I do not even know how we can help people who have those. But, clearly, as much information as possible, given as often as possible, will be part of that.

Finally, I cannot see anything in these amendments that the Minister would disagree with, so I very much look forward to the Government accepting them all and saying what a good job the Opposition are doing.

[Lord Grayling (Con)]

My Lords, I will pick up on the points my noble friend Lord Moylan made about demand-responsive buses. I acknowledge what the noble Baroness, Lady Brinton, said. The key point of those buses is not that they are for disabled people but that they are a fundamental part of the future of transport in many rural areas. It is enormously important that, as local authorities migrate to a new way of doing things under the terms of the Bill, they encourage the development of demand-responsive buses. The reality is that they are an important way to bridge the gap between many rural communities and local towns, given the absence of public transport. It is important that buses do not develop in a way that excludes those with disabilities. We need to encourage local authorities in this respect.

I agree that currently, demand-responsive buses are significant for the elderly and the disabled, but that is not how it must be in the future. It is important to transition to the new arrangements in a way that does not forget the important role the demand-responsive system will play for disabled people as well. It must be part of local authorities’ responsibilities to be mindful of how that happens. That may involve vehicle standards or other provisions, but demand-responsive buses and disability must go together in the context of a new world where such buses are simply a part of our public transport system.

[Baroness Grey-Thompson (CB)]

I rise to speak strongly in favour of all the amendments of the noble Lord, Lord Holmes, and Amendment 56, to which I have added my name.

We are trying to get to the position where more disabled people can travel by bus. A good bus network has a positive impact on the local community. KPMG and ITS Leeds found that a 10% improvement in local bus service connectivity is associated with a 3.6% reduction in deprivation, leading to measurable improvements in health, skills and income. However, many disabled people have poor experiences of using buses. I have had my own.

On New Year’s Eve, a driver refused to put the ramp down, let everyone else on, and then argued that there was no space for me to get on. We were then left with the potential issue of two people with buggies and I arguing over who was able to use the space. The driver refused to engage with me and tried to split my family up; my daughter is an adult, so, fine. The driver then suggested that we all get off and wait for another bus behind—who knows when? I was having a discussion about all this when an amazing woman with a young child in a buggy who was only going one stop further got off, so that I could get on and take a much longer journey.

A number of people have been in touch with me about problems such as having been refused service, ramps not working or drivers not wanting to pick them up. There is also the issue of where the ramp is positioned when buses stop to enable a safe set-down. London buses seem to be in a much better position than others around the country, with induction loops, audio announcements, LCD display screens and information posts, but people should not have to try to count the number of bus stops in order to get to where they are going. In a survey of blind and visually impaired people using TfL, 65% of blind or partially sighted respondents told the Sight Loss Council that making transport accessible was the most important thing to them.

I am briefly going to cover floating bus stops, because they are a massive issue for all people. They are dangerous at busy times of day. When I get off a bus, once the ramp goes down I have to pull a wheelie so I can control the speed. But often, there is not enough space for my wheelchair to fit at the side of a floating bus stop. On Westminster Bridge, which I cross at least a couple of times a day, on many days I see bikes not stopping and running both sets of red lights, and where the floating bus stop is located. Indeed, this morning I saw a delivery driver riding the wrong way over Westminster Bridge in the bike lane. Those getting off the bus would not even think to look both ways. They were in quite a dangerous position.

I agree, slightly, with noble Baroness, Lady Brinton, about cyclists. The situation is dangerous for them, although I find myself turning into a woman of a certain age, shouting at cyclists who run red lights and cause a lot of problems. We have to take into account that TfL’s own published figures suggest that 60% of cyclists do not obey road rules by giving way to pedestrians at crossings. When you factor this into floating bus stops, you can see why the situation is so dangerous.

Evidence has been collated by the RNIB, which is keen to highlight how dangerous floating bus stops are for blind and partially sighted people. Government research shows that when London’s floating bus stops were designed, blind and partially sighted people were not involved in the street design process. Wheels for Wellbeing is worried about the number of disabled people who, because of that, could be discouraged from using buses. I am going to use a phrase that I normally use for my experiences of travelling by train: I just want the same miserable experience of commuting as everybody else. We are not quite there yet, but making it better for disabled people makes it better for everybody.

Airport Expansion

Lord Grayling Excerpts

Monday 3rd February 2025 Lords Chamber

[Lord Hendy of Richmond Hill (Lab)]

I thank my noble friend for that question, and this department will do all it can to facilitate the reopening of Doncaster Sheffield Airport.

[Lord Grayling (Con)]

My Lords, I was the Secretary of State who took this proposal through the Commons seven years ago, and I declare an interest as an adviser to AtkinsRéalis. The Chancellor suggested that work on the runway could begin before the end of this Parliament, which is only in four years’ time, and that for that to happen, it would be necessary for the process to start part-way through it. Do the Minister and the department believe they have to go back to square 1 and start from the beginning with a national policy statement and then a DCO again, or do they believe that that process can be short-circuited and they could start somewhere further down the track?

[Lord Hendy of Richmond Hill (Lab)]

The noble Lord is very familiar with the processes that have been gone through so far. The answer to that question is that it really depends on what is submitted by the promoter this summer. We all know that there was a proposal for a third runway in the north-eastern quadrant of the airport. To start with, it depends very largely on whether that submission is very similar to the one the promoter made previously or if there is something substantially different.

Bus Services (No. 2) Bill [HL]

Lord Grayling Excerpts

Committee stage
Tuesday 28th January 2025 Grand Committee

[The Earl of Effingham (Con)]

I say to the noble Baroness, Lady Jones, that in the same way that we saw her speaking to other noble Lords on the previous Bill, when she said this was happening in the Chamber, we should continue with the proceedings and listen to what everyone has to say, which is everyone’s right in this Room.

[Lord Grayling (Con)]

My Lords, I will speak only briefly, but I want to raise a particular point with the Minister on which I would like his clarification. What I would say to the noble Baroness who has just spoken is that, having just arrived in this place from the House of Commons, I find it noticeable that the depth of scrutiny of Bills seems to be rather deeper here. In many ways, as a former MP, I regret that, as it should not be like that. It is important that legislation is scrutinised carefully and questions are asked. I think that this House plays a very important role in ensuring that legislation is as good as it possibly can be.

The issue I have to raise with the Minister is the reason I support the amendment moved by my noble friend. I worry that ideology may sometimes get in the way of good service. I know that it would not happen in his case—I have the highest respect for the Minister—but I can quote one or two other examples in government, the future of academies, for example, where ideology seems to be treading on the toes of what is best for young people. I would not wish that to happen in the area of transport and buses, and I have misgivings about the Government’s plans to allow the setting-up of municipal bus companies. There is no obvious mechanism to ensure that there is a high-quality case for doing so.

I have also been quite worried about a simple principle. One of the things that has always attracted me to deregulation is the ability of an individual or a group of individuals to decide that the firm they work for is not doing a good job, so they will set one up in competition and do a better job themselves. I see no real reason why a simple clause such as this that places a duty on not just the Minister personally but those who work for him to ensure that the decisions they take, the interactions they have and the things that follow through from this legislation deliver high-quality, better bus services and are not just there for ideological reasons.

My noble friend mentioned London and the concern that certainly exists outside London. What makes London distinctive in bus terms is that it is vastly more subsidised than any other part of the country. I remember as Secretary of State being surprised to discover the level of discrepancy. What we all want is the best possible service. That is why I relaxed the franchising rules five years ago. I cannot see the objection to a simple clause that places a duty on the Minister and the teams who work for him to ensure that every decision taken is the best one for the passenger.

[Baroness Pidgeon (LD)]

As we start our detailed examination of this bus legislation, we should not forget that 1.6 billion passenger journeys were made by bus across England outside London in 2023 and that buses are essential for people to get to school, college, work or appointments and to have access to shops and leisure. A good bus service provides wider economic and social benefits for local communities, businesses and public services. As we start our deliberations today in Committee, we on the Liberal Democrat Benches overall welcome this legislation, which is looking to improve bus services, grow the number of passengers using buses and ensure a more reliable network connecting people and places. Our approach is to make improvements to the Bill to tackle the problem that bus services in many communities across the country fall far short of the required standard and level of service. As I stated at Second Reading, this situation must change. Reliable public transport is not a luxury. It is a necessity, especially for those who are most vulnerable.

Amendment 1 would place a duty on the Secretary of State to have regard to the purpose of the Act, namely, to improve the performance and quality of bus passenger services in Great Britain. It is similar to the amendment tabled by the noble Lord, Lord Gascoigne, to the public ownership of the railways legislation last autumn. At face value, it is impossible to disagree with this statement. It is fundamental to this legislation and the range of areas covered in it that this is about improving bus services across the country, rather like the rail legislation was the Government’s first response to improving our railways. In many parts of the country, our bus services have reached a crisis point and, indeed, are virtually non-existent. Therefore, improved performance and quality of bus passenger services must surely be the clear aim of this legislation. This amendment would make it clear that the primary, but not the only, purpose of the Bill is to improve the performance and quality of services.

My Amendment 52, in the third group, would place a broad duty on authorities to promote bus services in their jurisdiction, with a lot of detail regarding measures to consider. A report every two years covers the point about improvement to services and, in my view, deals with this issue in a more comprehensive and devolved manner, which is much better suited to this legislation.

The comments made by the noble Earl, Lord Effingham, about one size fits all do not reflect the legislation before us today, which provides a range of options for local transport authorities to choose the best option for their area and community. This is not about putting the London bus model across the country; it is about using whichever model suits local areas. I look forward to hearing from the Minister how the Government will respond to this amendment, how they interpret these words and, if they do not support them, whether they have other words that they may bring forward instead.

--- Later in debate ---

[Lord Grayling (Con)]

My Lords, again I rise briefly to follow my noble friend on these matters and to ask the Minister to give some thought to some of them before we get to Report. I want to return to the issue of ideology. I have never taken an ideological approach to this. That is why we have franchising in Manchester; I legislated for it, and I am very pleased that it has worked. I think that the London model, although it is heavily subsidised, has proved to be very good. I am not convinced that it is viable everywhere in the country. I am very pleased that it works in Cornwall, but I am far from convinced that it would work in Surrey.

The issue is this: the Minister is a respected figure in the transport world, but he is part of a Government who are pretty ideological and part of a party that in local government is pretty ideological. Ultimately, ideology should never take precedence over what is right for the consumer or passenger, but sometimes it does. I shall give him a practical example. I do not believe for a second, outwith being a member of a Labour Government, that he would seriously argue that bringing Chiltern Railways into state control, given how well it has performed over the past 25 years, is genuinely going to lead to a quantum better service for passengers. All I am seeking to do in probing him on this is to ask him, perhaps today or perhaps on Report, to address the question of what the safeguards are if ideology treads on the toes of good service for the passenger. If a decision by a local authority or a mayoral combined authority is genuinely going to provide a negative or uncertain impact for the passenger, there should be at least a duty in the Bill for that franchising authority to have regard to quality and not simply exclude the private sector for ideological reasons because it wants to take buses into a municipal bus company or run it in a particular way. Ultimately, the interests of the passenger should always come first. I seek his reassurance. Perhaps he will give some thought ahead of Report to how he is going to ensure that some of the issues that my noble friend has rightly raised are properly reflected in the legislation so that the customer really will always come first.

[Lord Woodley (Lab)]

First, I apologise again for my premature interjection earlier. I was given the wrong running order. I should have checked it; I was stupid. I am going to speak to Amendments 7, 17, 18, 19, and 20, which are in my name, and talk about the potential effects on working men and women who run this fantastic service that we all rely on so much.

Although existing legislation extends service notice periods, they are much shorter than the time required to roll out franchising. There is no doubt about that. I believe that procurement of services takes around nine months, followed by a further nine months for mobilisation. Amendment 7 addresses the risk that unsuccessful or unscrupulous operators could run down services prior to new franchises, affecting service continuity and potentially putting members’ jobs at risk. Therefore, will the Minister commit to assessing whether further regulation is needed to ensure service continuity where local transport authorities pursue franchising?

Feedback from those involved in the rollout of franchising in Manchester, the only area outside London yet to implement franchising, is that early and meaningful engagement with trade unions is vital to its success. The Department for Transport has said that it would “expect” all local authorities to engage with trade unions. However, expectations are not enough. Amendment 17 seeks to learn from the experiences of Manchester and ensure that all local authorities take a consultative approach with the unions and have a joint staff forum in place as recommended. This ensures consistency across the country and best possible outcomes for franchising. Will the Minister commit to publishing a code of practice or guidance for local transport authorities to follow as part of the franchise process?

Finally, my Amendments 18, 19 and 20 would strengthen staff protection in areas where local authorities implement franchising. As the Bill reverses the ban on new local authority bus companies, Amendment 18 seeks to ensure that provisions around the transfer of staff apply. There is a risk that bus operators under franchise contracts will seek to drive down pay and conditions in a race to the bottom or employ new starters on inferior pay and conditions.

Amendment 19 proposes that workers’ terms and conditions will be maintained for the duration of the franchise to prevent the creation of a two-tier workforce by ensuring that new staff are not employed on inferior terms. Although TUPE will apply when services transfer to new operators, these regulations need strengthening so that staff are protected not just at the point of transfer but throughout the franchising process.

Amendment 20 would establish that as soon as a local authority launches its franchising consultation, the full coverage of TUPE will apply. Will the Minister commit to bringing forward the regulations or statutory guidance around protections for staff that Amendments 18, 19 and 20 seek to address?

--- Later in debate ---

The noble Lord, Lord Grayling, asked what the safeguards are. The elected nature of local authorities is one such safeguard, because they are elected by local communities. The other way round—the counterfactual —is that local communities currently have no protection against the pre-emptory withdrawal of commercial bus services by a commercial operator. That has happened in several cases—in fact, including in the noble Lord’s own area.

[Lord Grayling (Con)]

Will the Minister accept a challenge on that point? He will know that, in terms of the current role of local authorities in areas such as mine, if that happens, they will step in and provide a service where the private sector cannot do so. It is not as if there is a total vacuum and the local community is completely exposed to the decisions taken by the bus operator.

[Lord Hendy of Richmond Hill (Lab)]

I thank the noble Lord for his interjection. In his case, it is true, but there are other cases where the market has shown a considerable inability to respond across the country.

To conclude on Amendment 14, it is for the reasons I gave that I ask the noble Lord, Lord Moylan, not to press his amendment.

Amendment 15 in the name of the noble Lord, Lord Moylan, would require a local transport authority to carry out a preliminary assessment if it was considering franchising its bus services. Much of what the noble Lord has proposed to be included in the preliminary assessment is already included in the current legislation and must be included in the local transport authority’s franchising assessment. An assessment may or may not conclude that franchising is the best option. The assessment would then be published if an independent assessment had been carried out and the decision was that franchising was the best option. This amendment is therefore unnecessary, and I would welcome the noble Lord not pressing it.

Amendment 16 in the name of the noble Lord, Lord Moylan, seeks to impose a five-year moratorium on repeating franchising scheme assessments in the same area if the previous attempt was unsuccessful. The aim of the Bill is to simplify the process for authorities wishing to pursue franchising, ensuring that decisions are made at the appropriate level and in a timely manner. This amendment would introduce unnecessary constraints on local transport authorities by adopting an overly rigid approach. There are many factors that might lead an authority to decide against pursuing franchising initially, only to reconsider this later; indeed, the period of time suggested by the noble Lord would in some cases exceed the cycle of local authority elections, in which a different party that chooses to do something different might be elected. Imposing a blanket restriction limits authorities’ ability to respond flexibly to evolving conditions and opportunities. Assessments are costly and time-consuming so will not be undertaken lightly. This amendment is unnecessary; I hope that the noble Lord will not press it.

--- Later in debate ---

[Lord Moylan (Con)]

My Lords, I will speak briefly to Amendment 13 standing in my name. I can see the role of direct awards as a matter of principle in certain cases. They have the effect of removing from the process competition between potential bidders for a contract, but there are benefits to competition. I know the Minister wants me to imbibe and regurgitate great chunks of Lord Ashfield’s writings from the 1920s and 1930s, in which he could barely tolerate the word “competition” without using the adjective “wasteful”, but there are some benefits that might arise from competition that even the Minister might admit to.

I am willing to accept, if the Minister gives this assurance, that taking competition out of the process can be consistent with existing procurement legislation. He started to make that argument at Second Reading. I will not challenge him and say that this is contrary to procurement legislation—possibly it can be made compatible with procurement legislation, but he needs to explain how. However, I am concerned, in cases where there is more than one incumbent operator—which may well be the case, especially where local transport is for more geographically dispersed areas—about how a direct-award process might work in a way that was seen to be fair and did not expose the process to potentially awkward, difficult and unpleasant legal challenge and things of that character.

Essentially, I am trying to get more clarity from the Government about how direct awards will work in the more difficult and complex circumstances. I am seeking explicit assurances about the compatibility with procurement legislation, which I suspect the Minister can explain convincingly, but it needs to be put on the record.

[Lord Grayling (Con)]

My Lords, I support my noble friend’s comments. The difficulty with direct awards is that sometimes they are genuinely necessary. We experienced that on the railways—where circumstances change, a business fails or there is simply a need to take greater control for reasons that come along unexpectedly. The danger is—I go back to what I said earlier about ideology —that the requirement for a direct award caused by circumstance is overtaken by direct award driven by ideology.

I am afraid that that is at the heart of the noble Lord’s amendment. I understand the principle he represents, but it would not be right to have a situation in which a local authority was able, unfettered, to set up its own bus company and make a direct award to it, regardless of whether it was any good or not—there have been many occasions in history where the local municipal bus company has not been good at all.

In the world the Government seek to create, where in my view there is a role for direct award, on occasions, when it is necessary, I too would like to understand how the Minister would ensure that that power is used in a way that is right and proper, and, ultimately, as I said earlier, beneficial to the passenger.

[Baroness Pidgeon (LD)]

The amendments from the noble Lords, Lord Woodley and Lord Moylan, show both ends of the spectrum in this area—one wanting to make it easier for a local authority bus company to be directly awarded a service, and the other wanting the Secretary of State to be involved and lots of bureaucracy to make it even harder. But I absolutely agree that these amendments throw up some real questions around direct awards, and I hope the Minister can provide some clarity.

Direct awards can be made to existing operators where the post award services are deemed “substantially similar” in the context of direct awards. What criteria will be used to determine that? What is the precise definition of “substantially similar” services? How will the requirement for operators to take on real operational risk be defined and enforced under a direct award? As the noble Lord, Lord Moylan, has just rightly stated, in situations where multiple operators currently run services, what are the criteria for selecting an operator to receive a direct award? Will all existing operators be awarded a direct award? What guidance is going to be provided to local authorities regarding the structure of direct award contracts? What flexibility will they have in negotiating terms?

The bus industry welcomes this legislation but it will want some certainty. I hope the Minister can provide that in his response to this group of amendments.

Driving Tests: Secondary Market

Lord Grayling Excerpts

Monday 13th January 2025 Lords Chamber

[Lord Hendy of Richmond Hill (Lab)]

I have no need to do that; my noble friend has just done it for me.

[Lord Grayling (Con)]

My Lords, the Minister has just said that 25% of tests appear to go through some of these third-party sites. My noble friend has also said that some of these sites are genuine scams. Why is it that any driving test can be booked anywhere except on the official DVSA website? Why can he not just sort that?

[Lord Hendy of Richmond Hill (Lab)]

One of my colleagues said, sotto voce, “For the same reason that you did not”, which is perhaps not an unreasonable point.

Cost of Living: Rail Fares

Lord Grayling Excerpts

Monday 6th January 2025 Lords Chamber

[Lord Hendy of Richmond Hill (Lab)]

I thank the noble Lord for his comments on Baroness Randerson.

On the future of the fares structure of the railway, it is overwhelmingly likely that, whoever the Secretary of State is, they will continue to have a strong interest in the fares structure of the railway. However, the proposition is that Great British Railways will be responsible for both revenue and cost, and therefore will have some freedom to set fares. It is true that I had hoped that the consultation document would be available before Christmas, but clearly that was not the case. The passage of the seasons in political time is variable, but I am going to promise that it will be available in the next few weeks.

[Lord Grayling (Con)]

My Lords, the Government promised us that public ownership of the railways would mean lower fares and better performance. We already have four previous franchises run by the state—that is, run by him and his department. Have those four areas experienced lower fares and better performance?

[Lord Hendy of Richmond Hill (Lab)]

The first thing to say is that public ownership of the railways, as the noble Lord knows, is not the only issue that needs to be resolved for the railway to run better. He will also know, because he was there at the time, that two of the companies were taken over at times of great distress in either performance or commercial performance, and that there are companies among those four where better performance and innovative fare structures have delivered a real result, notably the London North Eastern Railway.

The noble Lord must know that the performance of Northern is not very good, but also that it has been in public ownership for six years. I have said from this position before that industrial disputes there have been going on for so long that the management could not immediately enumerate how many they had got. That seems to me to be a failure of the previous Government and of the previous regime, because if you take a railway company into public ownership then you should seek to resolve its performance issues. This Government intend to do just that with those train companies which are already in public ownership but not performing in the way that London North Eastern Railway is.

Passenger Railway Services (Public Ownership) Bill

Lord Grayling Excerpts

Report stage
Wednesday 6th November 2024 Lords Chamber

[Lord Berkeley (Lab)]

My Lords, I will speak briefly to my Amendment 16, which is in this group. I am, as ever, grateful to my noble friend for sparing the time to talk about this. My amendment is designed to be helpful. It is designed from experience of previous railway legislation, in which we got bogged down in massive detail, with hundreds of amendments; we may get somewhere, but it takes longer.

Given the discussion that we had on a large number of subjects in Committee, and will probably have today on Report, I thought it would be useful to probe the Minister’s view of how long it will be before what I call the definitive Bill is published. If that is going to take until spring, as some of us have been told, it might be useful to publish a draft Bill or a draft Command Paper that we could read several months before and have the opportunity to debate. That might help us resolve what the real problems are and how to deal with them, rather than on the Floor of the House for many days in Committee and on Report.

That is the purpose of my amendment, and I look forward to my noble friend’s response. I am not going to press this amendment, but it will be interesting to hear what he has to say.

[Lord Grayling (Con)]

My Lords, I will speak briefly on some of the themes that my noble friend Lord Gascoigne has been pursuing around reporting on performance. The Government seem to be a little reticent about being willing to accept amendments which increase reporting requirements. However, there is an important issue here: will public ownership do what the Government have promised it will and improve performance on the railways? I have my doubts about that. I think the challenges of the railways are much more complex and not about ownership but the complexity of our system.

I have a very simple question for the Minister. When you arrive in this House as a new Member, one thing that is very noticeable is the extraordinary level of expertise that exists on Benches on all sides. He brings a very considerable degree of expertise in this House after a long and distinguished career in the rail and transport sector. Can he set aside for a moment his ministerial hat and give us a professional judgment about the likely performance? To take a comparison, can he reassure us that the London Overground, for example, would perform better if run directly as a public body by Transport for London rather than being contracted out to a private operator as it is at the moment? Can he reassure us on that, for the precedents that will exist elsewhere?

Franchising Schemes (Franchising Authorities) (England) Regulations 2024

Lord Grayling Excerpts

Tuesday 5th November 2024 Grand Committee

[The Minister of State, Department for Transport (Lord Hendy of Richmond Hill) (Lab)]

My Lords, these draft regulations relate to access to bus franchising powers for all types of local transport authorities in England outside London. The regulations bring into effect paragraphs (b) to (g) of Section 123A(4) of the Transport Act 2000, such that the types of authorities listed in those paragraphs come within the meaning of “franchising authority”.

These powers were previously limited to mayoral combined authorities and mayoral county combined authorities. However, these regulations give all types of local transport authorities access to powers to franchise their bus services. In doing so, they will ensure that decisions are made at the right level. These regulations aim to give the power to local leaders to determine the most appropriate action to deliver an improved bus network, based on the needs and circumstances of their areas. This step does not mandate local transport authorities to franchise; it is about providing them with a suite of tools to support their communities and deliver better bus services.

The department will build on the progress of these draft regulations through the introduction of the buses Bill later in this parliamentary Session. The Bill will deliver further changes to make bus franchising easier to deliver, alongside other measures on areas such as accessible travel. It will also improve bus services for local transport authorities that choose not to franchise, allowing greater flexibility over bus funding and letting local leaders deliver their own local transport priorities. Alongside this, the department is building its capacity to provide practical support to local transport authorities throughout the franchising process, should they wish to pursue it.

I will now provide some background information about these regulations. Bus franchising powers for local transport authorities in England, outside London, were created in the Bus Services Act 2017. Powers were automatically given to mayoral combined authorities and mayoral county combined authorities to allow them to prepare a franchising scheme assessment—essentially a business case—if they chose to do so, without requiring consent from the Secretary of State for Transport.

Currently, all other types of local transport authorities wishing to prepare a franchising scheme assessment face a two-stage pre-assessment process. First, regulations must be made which switch on access to the franchising powers. Secondly, the Secretary of State for Transport must give her consent to any individual authority to prepare an assessment of their proposed franchising scheme. This instrument implements the initial stage of this process for non-mayoral combined authorities, ensuring that they will need to obtain the Secretary of State’s consent only to prepare a franchising scheme assessment. This will reduce the barriers facing these types of local transport authorities in pursuing bus franchising.

I turn to the detail of the regulations. Bus franchising is a model for providing bus services where a local authority determines the details of the service and private operators are contracted to run the services. Alternatively, in a deregulated market, any company, subject to minimum safety and operating standards, can operate and have control over bus services. These regulations seek to empower local leaders to choose the model that works best in their area to manage their bus services. Bus franchising is one of those tools. Alternatively, local transport authorities can pursue high-quality enhanced partnerships with private operators or public ownership.

These regulations are part of the Government’s delivery of their manifesto commitment to give

“new powers for local leaders to franchise local bus services”.

Bus franchising will give communities a greater say in the services they can use, connect people to opportunities and benefit those on lower incomes, who disproportionately use buses.

This instrument implements the first stage of this process for all types of local transport authorities so that they require the Secretary of State’s consent only to proceed with the assessment. The department is also revising the bus franchising guidance to streamline the franchising process. The Government consider that this onerous process has acted as a barrier to local authorities. Removing the first stage of this process will make it easier for local transport authorities to pursue franchising if they wish to do so. The regulations improve the suite of tools on offer for local transport authorities to deliver better buses.

I am pleased to say that the statutory instrument was cleared without comment by the Joint Committee on Statutory Instruments. To address the only request made by the Secondary Legislation Scrutiny Committee, for more information on franchising, the department is also revising its bus franchising guidance, which sets out the franchising process accessibly and in detail.

These regulations represent an important first step towards delivering on the Government’s aim of ensuring that local authorities have the tools they need to plan and deliver services in a way that suits their communities. The forthcoming buses Bill, which will be introduced later in this parliamentary Session, will build on this progress. Through this instrument and the forthcoming Bill, the Government will deliver on their plan for improving the bus network and ending the postcode lottery of bus services. The plan is centred on putting control of local bus services back into the hands of the communities that use them and will give local leaders the freedom to take decisions to deliver their local transport priorities. I beg to move.

[Lord Grayling (Con)]

My Lords, I stand to speak briefly about these regulations, as I was the Secretary of State when the original legislation was passed. While I understand what the Minister is trying to do—he comes at this, of course, from the perspective of somebody who has led the franchising operation in London—I have two big misgivings about this change.

We very consciously extended the franchising powers to the other metropolitan areas and mayoral combined authorities, believing that what was being done in London and the volume of passengers there made that a sensible and realistic option. Despite that, areas such as Manchester took several years before deciding to go down this road. Promises were made about franchising happening quickly, but it never actually did at that time. Of course, the mayoral combined authority areas have the critical mass to do this, whereas the reality is that, on the ground in other parts of the country, the idea that an alternative to what happens now is available through franchising is something of an illusion.

The reality is that local authorities in counties such as Surrey, where I was a Member of Parliament for 23 years, already plan their services because they pay for them where a gap cannot be filled commercially. It is not as if they can somehow suddenly dictate that this route happens and that route happens. Given the low level of ridership, getting any buses at all to run is a challenge and something they have to fund and develop themselves. So I do not really see how expanding franchising to counties such as Surrey will make any difference whatever. That in itself seems to make this change anything but what the Minister has just described it as. Of course, franchising is a realistic option in metropolitan areas and mayoral combined authority areas. That is why we gave that power in the first place, but I just do not see it going to other parts of the country.

I have a reservation that goes beyond simply not understanding why this is necessary. There is a danger that this will hold back the development of bus services for the future. The reason I say that is that it was clear to me during my time as Secretary of State that the future of bus travel in rural areas, in particular, is about demand-responsive buses. It is not about traditional routes going all day long from A to B and B to A. It is about buses that do different things at different times of the day, follow different routes and respond to passenger demand. Effectively, it is about Uber-type operations on a large scale, with routes changing all the time based on who wants to use them.

I do not see how demand-responsive buses fit within a franchise system. I would very much like to hear the Minister explain that to me. By definition, if you are dealing with a private operator that adapts the routes it follows all the time to reflect individual demand on individual days, which has to be the future of buses in some parts of the country, how on earth does franchising fit with that? Yet a local authority may decide on this for political reasons, for example—on the Labour side, there were great debates at the time about wanting to see local authorities have greater control over bus systems—and I fear a conflict between its desire to structure things in some areas, trying hard to do so even when it has to pay for a lot of the routes itself, and not unleashing the potential of demand-responsive buses. They will be the future of public transport in areas of the country that remain ill-served by buses, and where it is difficult to make them operate simply because the sheer demand that exists in our cities is not there.

So I would particularly probe the Minister about how he sees demand-responsive buses working within the system that these regulations create. I still think that they are not necessary. Franchising in big cities and major conurbations is fine. This feels like a set of regulations that will not achieve very much. As the notes say, there is no actual demand from non-metropolitan combined authority areas and this instrument may hold back the private sector from the kind of innovation that will be needed for the future.

[Baroness Randerson (LD)]

My Lords, I welcome the progress on franchising represented by this SI. I always felt it was a great pity that the 2017 Act made franchising so complex, so I am pleased about the removal of the first stage of the franchising process. However, I draw the attention of noble Lords to the report of the Secondary Legislation Scrutiny Committee, of which I am a member. That report criticised the Explanatory Memorandum because it had little information on what franchising is and how it differs from the current situation. Also—I think this is crucial—how many local authorities are expected to adopt franchising?

I do not agree with the points made by the noble Lord, Lord Grayling, in full, but he raises an issue which relates basically to capacity. I will come back to that in a moment, but if franchising is not suitable for Surrey, why was it regarded in that 2017 legislation as acceptable for Cornwall? It is my recollection that Cornwall was allowed to franchise buses. An element of doubt is sewn in this SI in the Explanatory Note, which says that no impact assessment has been produced because the SI is not expected to have any, or any

“significant, impact on the private, voluntary or public sector”.

I find that judgment worrying, because bus franchising is a very big undertaking, a multimillion pound undertaking, and it takes a long time. I have watched Manchester, for example, struggle with franchising in producing the Bee Network over many years.

Nevertheless, despite the deficiencies in the way the SI is cast, it is welcome because it removes the first stage, as I pointed out earlier, and also because it extends bus franchising powers beyond mayoral authorities. At the time that this legislation went through this House, I questioned why, having voted, as a local authority, for an elected mayor, that made you intrinsically more capable of running the buses. It struck me as totally illogical. Not all bigger local authorities have elected mayors: I think of Bournemouth, Christchurch and Poole, which is a fairly densely urban area that does not have an elected mayor.

So I am pleased that the complexity of the process is being reduced and I am pleased that it is being extended, but, in reality, the key barrier remains the capacity and expertise in our local authorities. I was pleased to read that the department is looking to build up its capacity to offer advice and assistance to local authorities, because on the ground that is what they desperately need.

When the Secondary Legislation Scrutiny Committee asked the Department for Transport why there was no proper explanation in the Explanatory Memorandum, the department provided a very clear paragraph, which was included in our report. I recommend that noble Lords read it if they are in any doubt about the importance of this legislation.

Finally, the same legislation in the 1990s that allowed London to franchise and fatally divided the country between the bus haves and the bus have-nots also encouraged local authorities to sell their bus services and their buses and forced them to run them on a strictly commercial basis. It has interested me ever since that the few local authorities that still have bus companies and run their own buses at arm’s length are largely successful and some of the best examples of bus services in the country.

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The noble Lord wanted to know whether there was any money to do this. The answer is that there is some money. The investment of more than £1 billion in 2025-26 to support and improve bus services and keep fares affordable is being spent not only on the national bus fare cap of £3 from 1 January 2025 but includes £640 million for local transport authorities to support and improve bus services in bus service improvement fund planning and £285 million for the bus service operators grant to continue running and protect existing services.

[Lord Grayling (Con)]

Will the Minister allow me to probe that? The Red Book shows that the Department for Transport has probably had the worst settlement in the Budget, with barely an increase in either capital or revenue budgets taking place, so is this new money?

[Lord Hendy (Lab)]

I am citing sums which are available in 2025-26. I disagree with the noble Lord in conceptual terms that it is the worst settlement for years, to paraphrase him. It is a very good settlement, bearing in mind the state of the national finances. Indeed, in real terms, local government support has gone up by 3.2%. My point is that there is enough money here to support local bus services in local transport authorities in whatever way they want to provide them, and this statutory instrument allows them to provide them in more ways than they currently can. Also, as I just said about Manchester, and as I would say about a consistent network anywhere in towns and cities in Britain, if it is provided consistently and planned rationally, revenue will go up and that virtuous circle will enable more provision.

I hope that I have answered all the points that noble Lords made, but if not, I will be delighted to write.

In conclusion, the regulations we are considering give all types of local transport authorities in England, outside London, access to powers to franchise their bus services. This Government’s plan to improve buses starts here. Our next stage of reform will be the introduction of the buses Bill. This legislation will seek to make bus franchising even easier to deliver, devolve funding and improve accessible travel. It will also improve bus services for councils that choose not to franchise. The transformative work the Government are doing will turn the tide by giving communities the opportunity to better control local bus services and have a real say in building local transport networks that work for them.