Infrastructure Bill [HL]

Lord Berkeley Excerpts

Wednesday 18th June 2014 Lords Chamber

[Lord Berkeley (Lab)]

My Lords, I welcome many parts of the Bill, although it does rather seem as if it is sweeping up loose ends before the election. I thought that the Minister did pretty well in her introduction to cover things such as the changes to the Highways Agency; low-carbon homes; shale gas—oil is now low-carbon as well, apparently; planning; non-native species; and the Land Registry. But it is a bit of a curate’s egg. I shall concentrate mainly on Part 1. My noble friend Lord Whitty, from his great experience as a Minister, has outlined some things that I might also have views on, as did the noble Lord, Lord Oxburgh.

Starting with the Highways Agency, I think that there is benefit in moving towards the kind of structure that Network Rail will have after it comes under government ownership on 1 September. Again, it looks rather like putting two things side by side with no read-across between the different types of transport and the need to encourage some modes of transport at the expense of others. As the noble Lord, Lord Oxburgh, said, there is perhaps a silo mentality.

With regard to the new highways companies, as my noble friend Lord Whitty said, how many companies are we going to have? I suspect that this is the start of seeing whether they could actually be privatised—but not in Wales, which seems to be exempt. It will not happen in this legislation but it might happen in the future. The problem, as other noble Lords have said, is where the revenue is going to come from.

My next question concerns the application of the Freedom of Information Act. It seems to me that the company or companies should be subject to FoI, which the Bill requires Passenger Focus to be subject to. It is a bit odd to have Passenger Focus subject to FoI if the companies themselves are not. I have been saying over many years that Network Rail should be subject to FoI as well. We need a bit of consistency here.

It is difficult to talk about governance because we do not know much about it. I believe that the Minister promised us a document before Second Reading but I do not think it has come. It may be that we will get answers to many of the questions that I and other noble Lords will be asking, but we need it as soon as possible and I hope that she can tell us when we can expect it.

I would like the Minister to comment on whether, in the preparation of the road investment strategy, the Government will take account of the Climate Change Act, the national parks Act and various other Acts, such as right-of-way and environmental legislation. If they do, there needs to be some read-across to Network Rail’s process. Will they undertake the same type of consultation on routes as that which underpins the rail investment strategy? It should underpin the road one because one should look at routes in a multidisciplinary way, with road and rail being compared on particular routes. Will that happen?

Other noble Lords have talked about the funding for the new companies. Will it be similar to the HLOS under which Network Rail operates? I wonder how the Minister has come up with a saving of £2.6 billion in 10 years. How will that be checked and monitored? We have the monitor, which I shall come on to later, monitoring various aspects of the companies’ work.

In the case of Network Rail, the Office of Rail Regulation required it to make savings of about 40% of its turnover over a 10-year period, which is a massive saving, and I think it has done very well to achieve it. Will the monitor therefore be required to do the same for the Highways Agency? It would seem reasonable if it did, but that assumes that there will be a five-year funding programme rather than the annual one which my noble friend Lord Whitty suggested will probably happen. I believe that that has happened to the Environment Agency. Most of my party think that the Environment Agency’s revenue has been drastically cut, and I agree. The Government say that it has been increased, but the problem is that it has been changed—I think, for the worse—so we will need some comfort on that as well.

Going on to cross-modal issues and the duties of the strategic highways authority, will a duty be put on it to work with Network Rail and other relevant bodies? We must not forget local and regional transport bodies, as other noble Lords have said. The amount of traffic on the main Highways Agency roads is actually not a high proportion of the total.

Then there is the question of forecasting, which we have raised many times; the noble Lord, Lord Bradshaw, has also raised it. Will we get some consistency of forecasting of traffic between road and rail? Will we have one forecast or a range? Will the regulator, or whatever it is to be called, be expected to assess the modes together along corridors? How will the highways side of it take into account the needs of buses, cycling and walking? The Minister may say, “You don’t walk along trunk roads”. If you do, you need a footpath or a cycle way. Trunk roads are, after all, a means of travelling between different areas, and there is absolutely no reason why there should not be cycle tracks and footpaths along them. There probably should be some beside HS2, if it gets built. Those other modes of transport need to be included in any policy work that the authority and the department undertake. I will be interested to hear what the Minister has to say about that.

Turning to the Passengers’ Council, I find it extraordinary to have a Passengers’ Council looking after roads and their customers. The AA and the RAC do not do a bad job of looking after the customers of roads driving cars or motor bikes, and the Road Haulage Association and the Freight Transport Association do a pretty good job of looking after the interests of their members. They are not funded by the Government. When it comes to railways, the Rail Passengers’ Council is funded by the Government, but who looks after the interests of rail freight? The answer is the Rail Freight Group, in which I declare an interest as chairman, and the Freight Transport Association. I cannot believe that the Government intend to offer us £10 million of subsidy to make us equal to the roads. It seems extraordinary that they think that the passengers who drive up and down the roads need a subsidised organisation to look after their interests, but perhaps I am missing something there. I look forward to what the Minister has to say about that.

My noble friend Lord Whitty rightly mentioned the Office of Rail Regulation looking after roads. First, it needs a new name. Secondly, who will fund it? For the railways, it is funded 50% by Network Rail and 50% by the customers, the passenger and freight operators. Presumably, the companies running the strategic road network will fund half of it for roads and the road users will be asked to fund the rest. Is that a rogue user charge, or how will they do it? Or is it yet another subsidy for the roads? I do not know. For railways, the Railways Acts put specific duties on the ORR to guide its works. Would it not be useful if there were specific duties on the monitor, or whatever we want to call it, so as to have its duties specified in this legislation?

The next matter is something that I feel quite strongly about. It is not here in the Bill, but it should be. It is to do with level-crossing legislation. Your Lordships may be thinking, “Why is he talking about that now? It is a minor detail”. However, there are 7,000 level crossings in this country, each with its own legislation. As noble Lords will know, Network Rail has recently been quite severely criticised by the Commons Transport Committee and the Lord Chief Justice over various things that have gone wrong. The legislation is incredibly complex and difficult. I am told that you cannot even change a light bulb in a level-crossing light without putting in a special application to the Office of Rail Regulation for each level crossing, because if you do not, Network Rail might be liable. I am also told that there are 8,000 pieces of legislation, so it could be said that this is a really big red tape challenge for the Government.

The Law Commission and the Scottish Law Commission have spent five years considering this and have proposed a Bill to replace all this past legislation with a simple framework within the Health and Safety at Work etc. Act 1974, which would apply to all stakeholders equally. The Law Commission published a draft Bill which is about 50 pages long, and it is a very good Bill. I gave the Minister notice that I was thinking of putting down the whole of that Bill as an amendment, but then I thought better of it. I am sure that she is grateful to me. However, it is something that we ought to talk about. I am very grateful to her for arranging a meeting so that we can all go through it. I think that that will happen next week. It is a wonderful opportunity to simplify things, save an awful lot of money and time and get the responsibility for the different parts of level crossings where it belongs.

I have one final example on this. Network Rail is responsible for everything, which is right up to a point. However, if a local authority and a bus company decide to put a bus stop 20 yards beyond a level crossing, and if the buses all stop there and traffic backs up on the crossing causing an accident, there is absolutely nothing that Network Rail can do about it except to stop the trains. Something needs to be done, and I am looking forward to further discussion about it.

Finally, I have two quick comments. First, on the non-native species in Part 2, can the Minister confirm, to an ignoramus like me, what a species is? Does it include things that fly or those that go on the land? Does it include things that swim or are in the water? She will probably understand why I am asking those questions. It is very important that the legislation cover all those things, so I hope that she can confirm that it will. Secondly, Part 4 is better late than never. I remember that, more than 10 years ago, when I was on the European Select Committee of your Lordships’ House, we visited Denmark to see wind farms on land which had been developed with the support of local communities, which then got cheaper electricity. In our report we asked why that did not happen here. Okay, it has taken 10 or 15 years, but I am very pleased to see that it is happening. I welcome much of the Bill and am looking forward to some good discussions in Committee.

--- Later in debate ---

[Baroness Kramer]

The noble Lord is talking to someone who does not understand quite how the government books work, but I do not recognise government borrowing being segregated into line items. However, I will follow up on that and write to the noble Lord before I tangle us in something that I have not explored in such detail. If the noble Lord is looking for imputed returns, we can discuss all that later.

The noble Lords, Lord Whitty and Lord Judd, raised the issue of Passenger Focus as a consumer watchdog. It strikes me as a superb representative of the road user. One of your Lordships suggested that the AA or other existing bodies act as a voice for the road user, but they tend to act as a voice for a limited number of views, typically those of car drivers. There are many other road users, and it is important that a much broader sweep, including cyclists, get represented. Using Passenger Focus, with its consumer skills, strikes me as a very important mechanism.

The noble Lord, Lord Whitty, and others also asked whether the Office of Rail Regulation was an appropriate body. It will act as a monitor, not as a regulator; that is an important distinction. The logic follows these lines. The SHC does not require an economic regulator in the way that Network Rail does. It is not dealing with track access charges and the users of the system are not paying in the way that passengers do, so there is really no role for an economic regulator here. There is not a number of TOCs all in competition with each other and with a complex relationship with Network Rail. It will advise the Secretary of State, who will then be able to enforce. It will monitor the operations of the new company.

[Lord Berkeley]

The noble Baroness is absolutely right in what she says. On the other hand, one of the roles of the rail regulator is to regulate the efficiency and costs of Network Rail. Would it not be a good idea to have some independent monitoring of this new company’s costs in the same way?

[Baroness Kramer]

The monitoring will indeed be there. That is crucial because of the way in which the SHC is being constructed.

The noble Lord, Lord Adonis, asked: where on earth do you get those savings from? It is covered in detail in the impact assessment and business case published by DfT on 6 June. It is important to understand that certainty of funding, which will come out of the road investment strategy, combined with the arm’s-length relationship, gives us a structure which is similar enough to the structure which has worked effectively in the rail industry. For example, the Government have committed £24 billion to road investment until 2021. Far more detail on all of this will come out of the road investment strategy.

The road investment strategy is set up in such a way that once established, if a future Secretary of State wants to change it, he or she obviously could—we cannot bind a future Parliament—but it would have to be done transparently, publicly and with consultation. Such pressures are an inhibitor which provides enough satisfaction to the industry to understand that it can look with reasonable certainty over the long term for the funding to be available. That leads to efficiency. We expect the SHC to approach asset management in a different way because it has such clear strategy and certainty of funding. It will also be set up as a company, with the roles that companies have, with its directors and chief executive. The sole shareholder will be the Secretary of State. I think that it will achieve its purpose. One could go over the top and try to reinforce that, but the question is: is that sufficient for the purpose to be achieved? If it is, that is the point at which we should stop.

Yes, the SHC will be subject to the Freedom of Information Act, so there should be no concern on the issue. I have addressed the issue of multiple companies. My noble friend Lady Miller of Chilthorne Domer mentioned—I am told that I have only two minutes left. Is that seriously true? If I have only two minutes left, I shall do one thing which is terribly important. I switch completely to address the issue that has been floating through the media and mentioned today: concern that land transfers could affect the Forestry Commission and the national parks. I addressed that issue briefly at the very beginning of my speech. I am looking hard to find the comments; if anyone can hand them to me I will love them for ever.