South West Rail Resilience Programme

Debate between Lord Berkeley and Lord Whitty

Monday 22nd May 2023 Lords Chamber

[Lord Berkeley]

To ask His Majesty’s Government whether they intend to provide funding to ensure the timely completion of the works to protect the rail line at Dawlish from flooding, including Phase 5 of the South West Rail Resilience programme.

[Lord Whitty (Lab)]

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

International Road Passenger Transport (Amendment) (Northern Ireland) (EU Exit) Regulations 2019

Debate between Lord Berkeley and Lord Whitty

Monday 20th May 2019 Lords Chamber

[Lord Berkeley (Lab)]

My Lords I have one question for the Minister, following on from my noble friend’s more detailed questions about what will happen after 31 December 2019. It is all set out in paragraph 7.3 of the Explanatory Memorandum. Apart from asking what happens after 31 December, as my noble friend did, I note that:

“The EU have agreed a legislative measure that will allow UK operators currently running regular and special regular services to the EU to continue doing so until 31 December 2019”.


My question concerns the word “currently”. If an operator wishes to start a new service this year, they will presumably not be allowed to, because they are not doing so currently. If this legislation continues with the same wording, they will not be able to do so in future. That looks to me to be starting to create a kind of monopoly of existing operators, because new ones will not be able to do it unless they are operating currently. I hope that the Minister can put my mind at rest and say that this does not actually mean that no new ones could start and that it is just a quick and easy way of expressing what might happen—but it is a worry, because at the moment any operator should be able to operate across the frontier, and let us hope that that can continue in the future.

[Lord Whitty (Lab)]

My Lords, I draw the Minister’s attention to the report published this very day by the Select Committee sub-committee that I chair on road, rail and maritime transport post Brexit. I will of course allow the noble Baroness a day or two before we get the official government response, but it has a chapter on the Irish dimension, covering not only bus and coach travel but also road haulage and rail.

I will focus on these regulations. Since the Good Friday agreement, and in some cases before the Good Friday agreement, bus operators have operated across the border and have improved the relationship between Northern Ireland and the Republic in a positive way, with people moving for work and for other reasons. The fact that that whole arrangement is now subject to some doubt is a serious problem, which goes well beyond the details of any transport regulations, frankly.

While our report focuses primarily on the possibility of moving to an agreement with the EU, it nevertheless has regard to the possibility of no deal. With no deal, as my noble friend has just underlined, as of Halloween we will be faced with a situation where the present propositions from the European Union will last only between then and New Year’s Eve. That is not a satisfactory position for any mode of transport. In particular, it is not a satisfactory understanding for a mode of transport by which individuals move to their work or families and which they have relied on for a decade or two to operate in a regular way.

I appreciate that my report—our committee’s report; I must not be so egotistical as two members of the committee are sitting here today—raises a number of issues related to Ireland. I hope that the Department for Transport in London is apprised of the situation in Northern Ireland, because there are some serious difficulties there. My noble friend raised the question of the decision to extend the Interbus arrangements to cover scheduled transport. That is unlikely to take place before the end of October—or, indeed, between the end of October and the end of the year. That will place a number of those routes in Ireland in doubt. I hope that the Minister and her department—in conjunction with the appropriate officials in Northern Ireland, since at the moment it does not have a devolved Assembly—will be able to resolve this issue in a way which, at least temporarily and in default of any longer-term agreement, will ensure that such services continue to operate. In the meantime, I commend the totality of my report to the Minister—no doubt her officials are studying it already.

Bus Services Bill [HL]

Debate between Lord Berkeley and Lord Whitty

Wednesday 20th July 2016 Lords Chamber

[Lord Berkeley]

My Lords, Amendment 123A would insert a new clause, “Passenger representation”, which tries to give bus passengers the same information—and credibility of information—that rail passengers get through Transport Focus, whose responsibility has recently been widened to include information about roads. This goes a bit wider than that, however, because local transport authorities need to set up mechanisms whereby passengers who are affected or who might use services can have credible information about proposed or actual services, as they have for rail services, and about reliability, quality and what happens when something goes wrong—as we discussed on today’s first Question.

It does not really matter who provides the services, whether it is a franchise, partnership or something else, but it is important. This could be done nationally, through Transport Focus or Bus Users UK, or locally, with co-ordination by a national body. Either way, there is a need for something like this and to have a requirement for it in the Bill. I beg to move.

[Lord Whitty (Lab)]

My Lords, I rise to support the principle of the amendment that my noble friend Lord Berkeley has just moved. We have had debates about inserting references to passenger representation at various points in the consultations on the Bill. My noble friend’s amendment seeks to state this as a general principle so that, in effect, there would be in every area some form of passenger representation to cover the involvement of passengers in the development and continued operation of the franchise, partnership or contract. Further, passenger representation should be part of the general decision-making process as we go forward, not simply in the original consultation.

In addition, my noble friend’s amendment refers to a complaints system. It is vital that there should be within this industry a system for complaints to be rapidly dealt with by the operator and, if necessary, the transport authority. To do that, there needs to be an effective passenger body. It could be a national body or a combination of a local body and Transport Focus nationally. On earlier parts of the Bill, the Minister very gratifyingly showed some encouragement to those of us who were arguing for engagement of passenger representation. I hope that in his reply the Minister can tell us, or at least give a general indication—tonight if possible but certainly before we get to Report—how the Government will bring forward amendments on Report to reflect that commitment to passenger representation and the ability of such organisations to deal with complaints with bus operators. It would be very useful if we all received a letter before Report setting out all the points at which this would be reflected in the Bill.

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[Lord Whitty]

My Lords, Amendment 128 calls for a strategy for the bus sector to be part of the Bill. It is fairly short and to the point. My noble friend Lord Berkeley has tabled a couple of rather more comprehensive amendments which express the same objective.

When I first thought of this amendment, I thought of tabling it before Clause 1. I may have to reflect on that after this short debate. The Bill is quite technical and procedural, changing contractual arrangements and introducing new technology such as ticketing systems and so forth. What it fails to do is give a clear indication of the strategy for the bus sector in terms of raising usage, extending buses in much-neglected rural areas, the nature and quality of buses, and their environmental impact. We need a strategy. We need the Government to come forward with a bus strategy that makes sense of the Bill in a broader dimension.

We can come back to this on Report. Obviously, we are nearing the end of today’s proceedings so I will not speak at length but it seems a missed opportunity not to require the Secretary of State to come up with an overarching strategy that would convince people that we are really serious about modernising, extending and making more environmentally attractive our bus services throughout England. I beg to move Amendment 128 here, at the obscure back end of the Bill, but the Minister may encourage me to put it right at the front of the Bill because that is really where it should go.

[Lord Berkeley]

My Lords, I support my noble friend’s Amendment 128 and will speak very briefly to my two amendments. Several of us spoke about this at Second Reading. I agree with my noble friend that the bus sector needs a strategy. After all, rail passengers have a strategy. Rail freight is having one soon, I am told. There is a roads strategy. There are strategies to do with most things in transport, except buses. I really think it is time for it and I will certainly support my noble friend if he puts a nice amendment down as Clause 0.

Bus Services Bill [HL]

Debate between Lord Berkeley and Lord Whitty

Wednesday 29th June 2016 Lords Chamber

[Lord Whitty (Lab)]

My Lords, I shall intervene briefly to underline one particular point. I agree that pretty much everything the noble Baroness, Lady Randerson, has said should be taken into account in the setting up of partnerships and in franchising.

There is one point that should be emphasised here and elsewhere in this Bill, and it relates to advanced ticketing and smart ticketing. The noble Lord, Lord Bradshaw, was kind enough to remind me just now, although I acknowledged it on Second Reading, that part of my work as a Minister years ago was never implemented. A big chunk of the failure to implement it is why we have this Bill now, and I congratulate the Government on putting it right. One part was successful, however. I was the Minister overseeing the invention and early implementation of the Oyster card. In 1999, I made the very first commercial use of the Oyster card at St James’s Park station down the road.

The Oyster card has utterly transformed public transport in London. There are other factors, but it is at least part of the reason why we have seen such an enhancement of the use of the buses, and indeed the whole transport system, in London, compared with other parts of the country, both in the cities and in the countryside. It is so much easier to make complex journeys, or even a single journey, within other towns and across the countryside if you already have an advance card. As the noble Baroness said, most buses, even some relatively elderly buses on our rural roads, have the machinery to cope with this or can be adjusted to do so.

This ought to be one of the legacies of this Bill and be writ large across the whole of the bus system throughout the country, with some interaction with other forms of transport as well. It should be developed as rapidly as possible. It should be one of the major achievements of this Bill and of the Minister and his colleagues in the department.

[Lord Berkeley]

My Lords, one thing that my noble friend has forgotten is that these Oyster cards should possibly be called Whitty cards, rather like the bicycles that are called Boris bikes. I am sure he would not want to be related to Boris in that way, but they are a great success.

I am pleased to be able to tell your Lordships that the local authority in Cornwall is going to implement a similar thing. It is very long and based on customer focus, but I will summarise it. The big double-decker buses will have wi-fi and tables so that you can put your laptop on them. They are going to run very frequently on the main routes. Smaller buses will go into the smaller areas. They will link in with the railway timetable, and I think that the operators’ ability to talk to each other will be unique. They are proposing a single ticket structure—one standard, one band. I hope my noble friend will appreciate this. It is going to happen within the next year or two.

This is a real example of a local authority taking an initiative. It sees that where you have several different operators, as there are at the moment, they never fit with the train timetable. They are going to. Nor do they fit with the ferries to the Isles of Scilly, but I am not going to go on about that now.

Amendment 54A in my name and some other amendments propose something on the quality of standards and on frequencies. We should probably also include interchange points, but we have not done so yet. Maybe we should also add something about a percentage of the population not having to walk further than X miles to a bus stop and an hourly or better bus service. There are what you might call faster services between the major centres of population—plus ones that you might say wiggle between villages and take a lot longer, although they do get there for people who do not have access to public transport. I believe that TfL has a bus services plan, involving the public transport accessibility level, which takes this into account, as does Transport for Greater Manchester.

Not all these things need to be in the Bill; the amendments here are perfectly adequate. However, they and the initiative that Cornwall County Council has shown would mean that neither partnerships nor franchises would provide a much better quality of service for all types of people who want to use it. The irony is that although it has been suggested that Cornwall will be able to have franchises in the same way as authorities with mayors—we will come on to that later—it is confident that all this will happen without the need for a franchise.

It is encouraging that the Government have produced a structure. I am sure that we can improve it, but at least it is there, and it should enable the volume of bus passenger traffic to go up, which is what we all want, with a much better quality of service. I commend what Cornwall is doing, but I hope that the Government will seriously consider adding something about the standards and the frequency of service, as well as the quality, and perhaps come back with their own suggestions on Report.

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[Lord Whitty]

My Lords, I have two amendments in this group which go in broadly the same direction as that of the noble Baroness and were intended to apply to existing as well as new vehicles. It seems extraordinary to me that the Bill as first drafted does not contain a need to have regard to environmental standards—even through the word “may”. Over recent months there has been increased attention to air quality in our cities and sometimes in our countryside as well; quite rightly, because the health effect and the environmental effect of air quality deterioration, plus the Volkswagen scandal, and so forth, have underlined the need to move more rapidly on all sources of air pollution, in particular in relation to vehicles.

I should declare that I am the current president of Environmental Protection UK, the successor organisation to the National Society for Clean Air; it was the leader of the successful lobby that led to the Clean Air Act 50 years ago this year, which seriously cleaned up visible forms of air pollution and, indeed, many invisible forms as well. We need now to finish the job and we have the technology, both in retrofit, as the noble Baroness has said, and in new standards. Buses may not be a huge component of air pollution but, per person and per trip, they are large contributors if they are not treated or the standards are not met.

I hope that the Minister will take away, if not the wording of any of these amendments, a need to write into the Bill, both in this section and the subsequent section on franchising which my second amendment deals with, that some of the requirements must relate to the environmental standards of the vehicles and the total environmental impact of the fleets of franchisees or contract holders. If it does not, it is a serious omission and a serious lack of joined-up government between the Department for Transport, DECC and Defra when we are trying to tackle both climate change and air pollution. Whatever final form of words we come up with before the Bill leaves this House, this ought to be reflected in both sections of the Bill.

[Lord Berkeley]

My Lords, I have my name to two of these amendments. I support what my noble friend has said. Let us remember that even in London, which probably has some of the newest and now cleanest buses in the country—even if they do not have any air conditioning, which does not seem to affect the emissions, luckily, but does affect the passengers—the then Mayor of London, who may even be our next Prime Minister, had to cover up the monitoring stations along Euston Road before the Olympics in order to keep the levels of pollution below those which had occurred in Beijing during its Olympics. With all the money that TfL had and has, it had to fiddle that. It was not a problem caused by buses but by other vehicles, but it was still a fact. It happens in many other cities and it is essential that some regulations or clauses such as those proposed by these amendments are included in the Bill.

Infrastructure Bill [HL]

Debate between Lord Berkeley and Lord Whitty

Monday 9th February 2015 Lords Chamber

[Lord Berkeley (Lab)]

My Lords, I welcome many of these amendments. There is a sense of déjà vu about today because we spent many hours debating this. I recall amendments put down by several of my noble friends and noble Lords on the Liberal Democrat Benches proposing many of the changes now coming back from the Government. It is great that they have taken so much of our advice. I welcome it. Let us hope that this is a precedent for many future changes.

I am pleased that Amendment 1 starts to provide a link between Parliament, Government and the SHCs because that is very important. We talked about that. It may not be what we wanted but it is a start to getting there. I am also pleased that we have an amendment that says that the ORR can give advice to the Secretary of State on the effect of its guidance. That is good. I hope that the ORR will feel able to give advice on many more things than that. I am also pleased that the Secretary of State must lay a report before Parliament on this—it is all obvious but it needs to be said—and it is important that this happens and happens regularly.

Would it not have been much easier to have changed the name of the ORR during the passage of the Bill rather than with all these amendments? However, I do not really mind and it does not really matter. That is fine. It is a shame that we have not been able to persuade the Government that the ORR, in addition to its work monitoring the SHC, should have powers to take action and require efficiencies as it is able to do for Network Rail. I hope that that will come one day as the ORR will have the capability to do that and it is a logical thing to do. It would be much better for an independent regulator to do it than to try to have the Secretary of State do it. We saw some problems with that with regard to the railways last summer. I also hope that in future we may be able to persuade whoever wins and becomes the Government after May that it will be useful to have the ORR responsible for road safety on the highways network as well. We did not quite get that far, but we are getting there.

Finally, I did not understand what the noble Baroness said about Amendment 45. It rather seems that if the staff of the Highways Agency do not feel that they will be properly reimbursed in whatever changes come they will be told, “That’s tough. You’re not going to get any compensation”.

However, this is a good step forward. We enjoyed the debates in Committee, on Report and at Third Reading and it was obviously a good use of parliamentary time. It is very nice to think that the Government have accepted many of the principles of what we proposed.

[Lord Whitty (Lab)]

My Lords, I echo quite a lot of what my noble friend said. We have moved in the direction of a report to Parliament and the role of the Secretary of State vis-à-vis the strategic highways company. I accept, I think, although like my noble friend I find the wording a bit peculiar, that that reinforces the application of the equivalent TUPE in relation to the staff of the Highways Agency.

The one point I am disappointed by, which my noble friend also mentioned, was that neither the Commons nor the Government have seen fit to strengthen the reference to road safety in the terms of the duties of the new company. It is a very weak form of obligation. It is slightly stronger than it was originally. The road investment strategy says that the Secretary of State must “have regard in particular” to the effect of the strategy on the safety of users. Later on it says that the company should “have regard”—no longer “in particular” —to the effect of the exercise of those functions on the safety of users. The phrase “have regard to” is the weakest form of legislative obligation. I had hoped that during the passage of the Bill we would strengthen that wording so that it would be an objective of the company and of the investment strategy to improve the performance on road safety. We have not got that and we are now at quite a late stage during the passage of the Bill but I hope that the Government will keep that under review as we go forward and the company is created. I do need to point out that I am a chair of the Road Safety Foundation. The anxiety that safety should be part of the DNA of the new body is broader than just among those who have any vested interests and certainly I would have thought that the Government could have moved further. However, on the rest of it, I thank the Minister for having moved a bit in our direction.

Small Business, Enterprise and Employment Bill

Debate between Lord Berkeley and Lord Whitty

Wednesday 28th January 2015 Grand Committee

[Lord Hodgson of Astley Abbotts (Con)]

My Lords, I also have a number of amendments in this group. I think the answer to the noble Lord’s question is that these amendments are all about Clause 42 and the subsequent groups are about subsequent clauses. What we are doing here is debating the whole of Clause 42, rightly or wrongly. It may be too big a group but that, I think, is the background. I think other amendments to subsequent clauses form other groups.

The Government have said that they will accept the spirit of the amendments passed in the other place, but I am afraid that despite the Minister’s assurance—

[Lord Whitty (Lab)]

My Lords, before the noble Lord, Lord Hodgson, proceeds, the point made by my noble friend Lord Berkeley indicates a more serious procedural problem. It is not that these amendments are not serious, but they are specific. I also have some amendments in this group, but if I degroup them, a decision would have been taken on the Minister’s amendments before we reached the appropriate point in the text of the Bill.

We have a very new clause, inserted at the final stage in the Commons. The Minister quite rightly said that there has been limited chance for consultation on that. We have a huge amendment from the Government deleting an entire clause and replacing it. The noble Lords, Lord Berkeley and Lord Hodgson, and I, all have amendments to the original amendments. My noble friends Lord Mendelsohn and Lord Stevenson have amendments to the Government’s amendments. So, there is not only a large number of amendments, but it is going to be a very confusing debate.

That is not to say that we should not have the debate today. However, the way that this has been dealt with, and the fact that consultation since the Commons decisions until now has not allowed consultation with the bodies that represent tied landlords, has not allowed for significant debate with those in the Commons who pushed this amendment. We have a few weeks between now and Report stage for proper consultation to take place. I am very happy to have the discussion today because that will inform the Government, but at the end of that discussion it will behove all of us to withdraw our amendments and move them for a proper discussion on Report, which could have been preceded by some effective consultation between the Government and the various parties involved, both politically and industrially.

Although we can degroup this group, there is a rather more profound problem here. If all noble Lords agree to withdraw their amendments at the end of the debate, there is no great problem and we can have a sensible discussion over the next three weeks. However, if we proceed, we proceed as per normal. It would be sensible, even from the Government’s point of view, if we allowed ourselves a bit of a breathing space to have those discussions.

[Lord Berkeley]

Is my noble friend suggesting that the Minister should withdraw her amendments as well?

[Lord Whitty]

Yes, my Lords.

[Lord Berkeley]

Good.

Infrastructure Bill [HL]

Debate between Lord Berkeley and Lord Whitty

Monday 3rd November 2014 Lords Chamber

[Lord Berkeley]

I shall be brief in speaking to this group of amendments because we have discussed at some length the licence for the strategic highways company. My Amendment 9 is a provision similar to what Network Rail now has. I was interested in the Minister’s comment that it is a licence for a commercial model and that the strategic highways company is not going to be commercial. I do not know whether Network Rail was ever commercial in her definition of the word, but it certainly is not now and I notice that the Government have not tried to change the licence to reflect any alteration. Perhaps she has a quick view on that. The draft licence that we received on 3 November was certainly an improvement on the previous version, for which I am very grateful.

The only other thing I wish to comment on in this group is my Amendment 17, which is to do with the duties of the strategic highways company. Whether they should go in a licence or in some other document, I do not know, but the draft licence from the Department for Transport is a licence to build roads, to take into account environmental concerns and to do it reasonably efficiently. Given experience of legislation over the years, there is a need to have in the Bill, for preference, or in a licence, if it must be that way, a wider role and wider responsibilities for this company to go cross-modal. That includes looking at road and rail—I declare an interest as chairman of the Rail Freight Group—passenger as well as freight, efficiencies, travel choices, developments in sustainable locations, as sustainability is very important in all this, and different modes to secure the economic, social and environmental gains jointly and severally. I do not think that these are in the draft licence at the moment. If the Minister would look at this again and see whether some—preferably all—these issues could go into a licence, I would be much happier that the strategic highways company was going to be part of a wider transport and environmental structure, taking into account the needs of customers, the environmental needs, roads, railways and developments in local transport. With that short introduction, I beg to move.

[Lord Whitty]

My Lords, I have Amendment 10 in this group. Again, as in the previous debate, my noble friend Lord Berkeley has put his finger on another lacuna in the Bill. Nowhere does the Bill spell out the functions and duties of the proposed strategic highways company. There is a whole schedule, 26 pages long, which largely consists of adding,

“or a strategic highways company”,

but does not actually say what that company should do. I find this extraordinary and not consistent with earlier circumstances in which we have set up public bodies or corporations to do a particular job, some of which are still doing it, where there was clarity in the legislation as to those functions. Those functions have to be economic, social and environmental these days. The Government should at least consider making sure, at later stages, that the Bill spells out the central duties of the companies. I hope that the Minister will take that away.

Drug Driving (Specified Limits) (England and Wales) Regulations 2014

Debate between Lord Berkeley and Lord Whitty

Thursday 24th July 2014 Grand Committee

[Lord Berkeley (Lab)]

My Lords, I have a question or two for the Minister on these draft regulations. I am glad that he had difficulty pronouncing the names of some of those controlled drugs, because I certainly would.

First, I think that it is a very good thing that the regulation is being brought in; we have all been debating for years having some limit for driving under the influence of drugs, as we once had for a long time for drink. How will these drugs be detected? Can it be done at the roadside, or will you have to go back to a police station, with all the fuss that that entails? Who can stop, detect and, if necessary, charge a driver? Presumably, PCSOs cannot; they can fine only bicycles and not cars anyway, but it would be interesting to have an answer for that. My third and most important question arises because 16 different drugs are listed here. Surely if you mix the lot, it is a bit more serious, even if it is under the limit, than if you just take one. I know nothing about it at all, but how will that be dealt with? If you exceed the limit on none of them but mix them all together, you might still be under the influence. No doubt the expert panel has considered that, and I would be glad to hear the Minister’s comments.

[Lord Whitty (Lab)]

My Lords, I am pleased to see greater specification in this area, but I am slightly confused about both how the levels apply and how we will deal with issues such as those raised by my noble friend. Clearly, a cocktail of these drugs, if three or four are detected, is more dangerous than the level for a single one. I do not know any more about it than my noble friend.

[Lord Berkeley]

Yes you do, you were a Minister once.

[Lord Whitty]

When I was a Minister, I was certainly not allowed to know a lot about it. However, some of them are more detectable than others. Included in the list—I will not attempt to spell it out—are drugs that relate to cannabis. The problem with cannabis is that it stays in the system for a very long time but is probably not active after a few hours. Therefore, it is difficult to treat in the same way as, for example, cocaine or diazepam. I wonder whether the same process of testing applies to all the drugs. I also wonder whether the reason why what I regard as unfortunate the changes in relation to alcohol detection—trying to simplify the roadside and the police station tests, thereby laying them open to challenge rather more than the present system—applies also to these drugs tests. Some drugs are detectable at the roadside, as I understand it; others are not.

As a throwaway question, as the Government are addressing those limits, why on earth are they not addressing the current alcohol limit, which is still probably the greatest—even if, thankfully, declining—cause of major accidents due to drugs in this country? Our level is considerably higher than that in almost every other European country.

Infrastructure Bill [HL]

Debate between Lord Berkeley and Lord Whitty

Tuesday 8th July 2014 Grand Committee

[Lord Whitty]

My Lords, I agree with much of what the noble Lord, Lord Bradshaw, has said, but of course the problem with the Bill is that under the Government’s current proposals the Office of Rail Regulation—perhaps with a better name—will be not a regulator but simply a monitor. There is no equivalence between the ORR’s relationship to the railways and what is currently proposed. We will come to one of my amendments later on that would allow some degree of regulation of quality, standards, the performance of the road network and road safety. At the moment, though, that is not what the Government envisage, and I would hope that the Minister would explain why. As the noble Lord has indicated, equivalence in our strategic network would appear to be common sense.

[Lord Berkeley]

My Lords, I also support these amendments. It is very difficult to see how the Secretary of State can fine himself, which is effectively what will be happening. As we know, that actually would not happen because long before it got to that stage—not that we know how it will get there, because that appears in Clause 5(2) and we have not seen the documents yet—the people running the SHC will get the sack, they will be told to change their policy in order that they comply with the road investment strategy or they will comply with the directions and guidance. So to some extent I think that this clause is a complete waste of time, although it would be nice to see what the Secretary of State said about the circumstances that may require the payment of a fine.

I agree with the noble Lord, Lord Bradshaw, and my noble friend Lord Whitty that we need to debate in more detail why this is not done by an independent regulator. Independence is the answer, and the independent rail regulator has the trust of the industry and, I think, of government; I am not sure about the other regulators, but we are talking about the ORR today. If it had those powers and it could use them, everybody would feel very happy that it had looked at the expenditure, efficiency, safety and everything else to do with the highways and come to an independent conclusion.

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[Lord Whitty]

My Lords, I will be brief on this amendment because the main discussion of Passenger Focus is in the next group of amendments. My amendment is simply about the name. I prefer my formulation to that of my noble friends Lord Berkeley and Lord Judd, because my amendment makes it clear that it is actually the users—the consumers—of these services who are represented by the council. I think that that point is more ambiguous in the title they are proposing. We need a new name, so I commend my formulation and beg to move.

[Lord Berkeley]

I am going to confuse the Committee because my Amendment 42, which we will come on to shortly, suggests that the name should be the transport infrastructure and services council. However, after I tabled this amendment I had a discussion with the chief executive of the Rail Passengers’ Council, who said that a much better name than anything anyone has suggested before, including the Government, was the transport users’ council. I will just throw that into the ring and see what the Minister and other noble Lords think of it.

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[Lord Berkeley]

My Lords, I do not want to prolong this discussion for much longer, but some of us, in setting out a role for the Passengers’ Council, are trying to ensure that it produces the right data and looks at alternative options before the company goes ahead and develops new roads. With regard to the planning system, I do not believe that the Passengers’ Council should have a role at all, but I believe that it has a role in producing the data to justify—or not—what gets done and to look at alternatives.

[Lord Whitty]

My Lords, I have tabled two amendments but I want to comment briefly on what has been said. I find myself slightly between the noble Lord, Lord Jenkin, and my noble friend Lord Judd. As Roads Minister for three and a half years in the last days of Swampy, I know what the noble Lord, Lord Jenkin, is talking about. We have to separate out the planning process from the monitoring of the operational process. On the other hand, I agree with my noble friend Lord Judd that when we are talking about users of the road network, we are talking not only about the people who that day happen to be driving a car or a lorry on that network, but also about all the people who depend on that network or whose premises and lives are affected by it. We therefore need to interpret “road user” in the broadest possible sense. Without straying into the planning system, I think that some of what my noble friend said should be reflected in the Bill.

My two amendments deal with different issues. Amendment 47 refers to the setting up a complaints system. One of the most effective jobs of Passenger Focus in relation to rail, and latterly buses, has been in dealing with a complaints system. Its effort has pushed the responsibility for dealing with complaints back on the railway and bus companies. It is there to pick up what those companies failed to do in terms of complaints. Similarly, we have never had the equivalent system in relation to strategic roads. It is important that a complaints system is seen as one of the responsibilities of whatever we eventually call the Passengers’ Council.

My second amendment is a probing amendment, which I will not press. It relates to Clause 8(6), which refers to a relationship between the Passengers’ Council and local authority rights. It says that the new consumer body could have responsibility for matters relating to local authority roads if the local authority asks it to. That is a bit cock-eyed. Either we make it responsible for complaints about all local authority roads, which I do not really want to do, although my amendment would have that effect, or we leave it as the user body for the strategic road network, which would be tidier. After all, complaints about roads for which the local authority is responsible need to be dealt with largely within the local authority context. There is plenty of scope for complaints to local councils about local authority roads.

If some local authorities want the Passengers’ Council to be there for consumers but others do not, there will be confusion. My local road, the A30, in 10 miles goes through Wiltshire, Dorset and Somerset. If only one of those councils agrees that the Passengers’ Council should be the consumer body, we would have to pinpoint exactly where the complaint arose—over a traffic jam, police incident, or whatever—and we would end up with a patchwork of bodies. Some councils would say that the Passengers’ Council was responsible and would shove off all complaints to it, while others would continue to deal with the complaints in their highways departments. Subsection (6) extends the Passengers’ Council’s role into local authority roads, which may be a step too far. My amendment should probably have been worded differently, but I want to hear what the Minister says in her summing up.

Infrastructure Bill [HL]

Debate between Lord Berkeley and Lord Whitty

Thursday 3rd July 2014 Grand Committee

[Lord Whitty (Lab)]

My Lords, I apologise to the Minister and the Committee that I was not here for the previous bit; I am afraid that I am boxing and coxing with the Chamber at the moment, and have probably already offended the rules of the House by nipping out during the Minister’s reply to move this amendment. Some of this amendment is relevant to what noble Lords have just been discussing on the previous amendment. Indeed, the first part of my amendment is a consequence of trying to clarify that we are talking about only one company and not several. That confuses people, particularly in local Government, who anticipate a degree of regional structures down the line. I know that the Minister will have cleared up some of that.

My second point relates to the issue of privatisation, of which the Minister was speaking when I came into the Room. Clause 1(3) of the Bill as it stands is branded as the way in which privatisation is prevented by the Bill; namely, that the designation would terminate if the company were sold or otherwise disposed of. To me, that seems a funny way of doing it. You will have a company which employs all the people who are at the moment employed by the Highways Agency. If it were somehow to be bought, all its duties would be removed. Surely it is far easier to give some parliamentary control over this process. If we are moving to a hived-off company, structured under the Companies Act but owned wholly by the state, and if it is the intention of the Government to keep it that way, why do we not state baldly in the Bill that it cannot be privatised except by primary legislation? That is what is proposed in the second part of my amendment. It may not be ideal, but it is a good deal better and clearer than what is in the Bill.

There are clearly worries. The first thought of most people when they heard that the Government were going down the road of hiving off the Highways Agency was, “This is the first step to privatisation”. There was alarm at that. There might have been in some quarters—but not ones that I have come across—some joy at the prospect, particularly were it to be related to road pricing, which in principle I do not oppose but is politically rather difficult for any of us to support, particularly a few months off an election. It is easier to assert the will of Parliament and say, “This is not privatisation. If there is any prospect of that changing, you will need a new Act of Parliament”. That is what my amendment proposes. I beg to move.

[Lord Berkeley]

I support my noble friend’s amendment. I am glad that he is here, because I am not sure that any other of us could have moved it. He did it very well. I want to compare this situation with what is happening to Network Rail, of which I declare an interest as being a member.

I have just come from a meeting with Network Rail where we have been told what is going to happen by 1 September, when it comes under government ownership. That sounds as if it is going to be quite easy, apart from changing all the memoranda and articles and allowing the Secretary of State or the accounting officer in a department to make certain appointments and control things. However, that is being done without much, if any, parliamentary scrutiny, because I do not think that anybody is particularly worried about it. Network Rail has been in the private sector up to now, but it has had £4 billion or so a year from public funds. It has managed to work and not cause trouble; otherwise, this would probably have happened sooner. However, there still have to be changes. I worry about it going in the other direction. As my noble friend Lord Whitty said, the consequences need some public debate, because there might be many more people who are worried about it, not least the people who work for the new company while it is government owned. It is reasonable to have some parliamentary scrutiny of a change. Therefore, I support the amendment in his name.

--- Later in debate ---

[Lord Whitty]

My Lords, I support the proposal that Clause 1 should not stand part of the Bill, as it queries whether the clause—which is the whole proposition here—is sufficiently coherent and clear as to what it intends to do. As a Roads Minister, I was responsible for at least one of the proposals for the A303 and remember that we talked to everybody in the community, including several different sets of druids, and told them that the Stonehenge tunnel would be built. However, as I said at Second Reading, no sod has yet been turned and all they have done is close one road.

I understand the Government’s intention to create a steadier position through having a slightly more arm’s-length relationship, but this is half-baked. It is neither fish nor fowl. This will be a company that is wholly owned by the Government and which—to address the point that has just been made—cannot raise its own money. The Minister has made that clear to me, both in writing and in person. I thought the main advantage of having the hive-off would be that the body could raise its own funds, even if subject to broader controls from the Treasury, but the Minister makes it clear in her letter that its situation will be no different to the current one of the Highways Agency. That seems to undermine the main advantage of establishing an arm’s-length body. The Government’s proposal incurs all the costs, all the confusion and all this great legislation in the Bill and all the schedules attached to it, but it does not, of itself, provide the funding, the strategic intent or the independence from Government and, crucially, from the Treasury. It will not avoid what has been a stop-go process for the past 30 years.

If the Government were proposing a new corporation that was properly set up and run and which, although still owned by the Government, had its own structural basis and accountability, as well as the ability to finance its activities in various different ways, I could see that there would be a significant advantage. With this halfway house, which is not even a halfway house, I see very few advantages. Therefore, I think that the Government would be more sensible to leave the Highways Agency where it is, give the agency more money and give that over a longer period of time—if that is the Government’s priority—and, if necessary, think up a fuller, clearer, more comprehensive proposition for what kind of highways organisation we need in this land. The answer to that might well be in the territory that my noble friend Lord Davies referred to, because what we perhaps actually need is a transport infrastructure company rather than one that deals with simply 2% of our roads.

If we were to do that, we could start to deliver the investment required for a genuinely integrated transport policy, whereas the Bill, as I am afraid I have said before, seems to be about changing the names on the doors without changing much else.

[Lord Berkeley]

My Lords, I would just like to ask the Minister where this figure of a £2.6 billion saving comes from. The two organisations Network Rail and the new strategic highways company will be quite similar, but one difference between them, which we will come on to in later amendments, relates to the role of the Office of Rail Regulation. Over the past 10 years, the Office of Rail Regulation has required Network Rail to make savings of about 60% of its turnover. That is quite a big saving, which has been achieved, while keeping the service going and the quality improving, because the regulator has very strong powers. If the savings are not made, or if the resulting performance of the network is bad, the regulator can fine Network Rail, as I believe it is planning to do next week.

The problem here is that the rail regulator will not have such powers over the highways authority but will simply monitor. You can sit monitoring things all your life, but you cannot incentivise or require an organisation to make the changes that it should. I am sure that there are changes to be made. I am sure that significant percentage savings could be made over quite short periods. On whether those would be the same as in the case of Network Rail, they probably could be, because Network Rail started off as a nationalised industry, which was probably pretty inefficient to some people. Although the Highways Agency has improved over the years, there is probably a long way further to go. However, unless we can get the ORR to have the same powers not just to monitor but to control and enforce cost reductions, I am not quite sure where we are with this.

Listening to other noble Lords, I am beginning to think that the only benefit from this that I have heard is the idea—which the Minister has, of course, denied—that the Bill is about getting the Highways Agency ready for privatisation.

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[Lord Whitty]

My Lords, Schedule 1 is 26 pages long. It is devoted almost entirely to inserting in the Highways Act the name of the company rather than the Secretary of State, or vice versa, and a lot of other administrative matters relating to assets, contracts and so forth. What it does not do—and I think it should—is to describe the responsibilities of the company and the scope of its activities, to which my next amendment relates.

This amendment is a shot at describing what I think will be the responsibilities of the company. This is Committee stage and, therefore, I hope that the department might accept the principle and draft a better description. However, essentially, somewhere in the Bill—I would prefer it to be in the body of the Bill rather than in a schedule, but the schedule is where the detail on the new company is spelt out at the moment—it should state what the functions and responsibilities of the company are.

The amendment refers to the obvious things: the construction, the maintenance and the improvement of the road system; traffic management for that system; and safety for that network. When I mention safety, on which I have amendments later on, I should inform the Committee that, since Second Reading, I have acquired an interest in this area in that I am now the chair, taking over from my noble friend Lord Dubs, of the Road Safety Foundation. Some noble Lords may recall that safety was a significant element when I was Roads Minister. Certainly, it is underplayed in this Bill and should be an important part of it, as are traffic management, speed controls, and so forth.

There is also the environmental dimension. There are problems about the construction and operation of roads. Somewhere in this Bill we need to say more clearly that the company, and not the Secretary of State any more, is now responsible for the environmental impact of the roads which are run by the Highways Agency. That includes the level of emissions which traffic management creates and whether that is going down and making a contribution to our carbon saving. It includes also the level of air pollution, which is largely proportionate to congestion and which, again, the Highways Agency network should be making a contribution to, as well as other things which are not perhaps so obvious, such as the run-off of water from highways, which has a significant effect on water systems—we have just passed a Water Act in which the quality of water is an important issue, including that of groundwater. Although most new schemes provide some better storage and diversion of water, from a lot of the old roads it still goes back into the ground or into the water system.

The amendment also refers to another responsibility, which is for research and development. I think that I am right in saying that the Highways Agency has its own R&D budget, but the Department for Transport also has a roads research budget. Is the whole of R&D on roads now to be the responsibility of this new company, which would probably be quite sensible? The Bill needs to be clear that the R&D on roads, traffic and the impact of roads is one of its responsibilities. A final dimension of the responsibilities that I am suggesting is the necessity to engage with road users and local communities, and the ability to enter into contracts with other providers. We will come later on to issues of co-operation with local authorities, and so forth. A key responsibility will be relations with road users themselves.

This amendment is my shot at this issue. I suspect that there could be a better one—but it is rather odd that a whole new nationalised infrastructure corporation should be established without the primary legislation saying anywhere what its responsibilities are. Therefore, I beg to move.

[Lord Berkeley]

My Lords, I support my noble friend in his Amendment 4, and I shall speak to the other amendments in this group. On Amendment 4, he is absolutely right. The strategic highways company needs to have responsibility for all the things that he has put in the amendment. I remind the Committee that there is very strong evidence that a month or two before the Olympics, when the air pollution on one or two of the trunk roads in London was reaching Chinese levels, the solution by the Mayor was to cover the monitoring points with plastic bags, which of course reduced the level of pollution inside the plastic bags but did not much help anybody else. But this needs to be done by the strategic highways company, and I would suggest that it needs to be supervised by somebody. That may be a role for the Office of Rail Regulation, or whatever it is to be called in future, because these are very important points.

My noble friend is right in his comment about research, but there needs to be some research into non-trunk roads, which are a very large part of the road network. I hope that that can be taken into account as well.

Amendments 6 and 7 relate to the 20 pages of consequential amendments to which my noble friend referred. It relates to something that may have got lost in the search for consequential amendments—the Environmental Protection Act 1990 and the question of which body is responsible for collecting litter on different roads. These two amendments are designed to make sure that the strategic highways do not get left out of the wrapping up; otherwise, we will see them covered in litter from head to foot.

I shall not read out all the parts of my amendment, because everybody can read them, and it probably would not make much sense anyway—unless you put a wet towel on your head.

Finally, my noble friend did not mention Amendment 61, which follows on from Amendment 4 and is to do with the transfer of additional functions to the strategic highways company in Clause 13(2). It covers highways and planning, but I agree that it should cover road safety as well, because that is a terribly important part of it. We will talk about safety comparisons later, but it would be good to see road safety in there, or something like it.

--- Later in debate ---

[Lord Whitty]

All the amendments in this group are mine. This relates to exactly the sort of thing that my noble friend Lord Davies was just referring to. The Highways Agency consists mainly of engineers—quite rightly, and very good engineers many of them are. In the fringes, there are traffic engineers, as well as highways engineers. When you ask them to build into their projects objectives other than those which relate to providing more, quicker or wider roads, there is a bit of barrier, on occasion. Between them, the amendments are an attempt to ensure that when we take decisions on road improvements or new roads, issues of safety and the environment are built into those decisions on the same basis as any improvement in travel time, the number of miles of road which are tarmacked, or whatever.

The Highways Agency contains within it people who take those things seriously, but the natural tendency, particularly when we put the foot on the accelerator of spending on roads, is to get as many roads built as fast as possible and not worry too much about the complications. One big complication has wider implications for the rest of the project: safety. Earlier, I declared my interest as the new chair of the Road Safety Foundation. Every year it produces a map of European standards and the state of Britain’s roads. I have the map here if anyone wants to look at it. Those are standards which have been worked up by various equivalent bodies across Europe. It is right to say that our motorway system, in particular, is one of the safest in the world and is the safest part of the British— English, in this case—road system. That, of course, is calculated on the basis of vehicle miles and comparing them. It is also true to say that 250 people a year are killed on Highways Agency roads every year, and 2,000-plus are killed or seriously injured on those roads. That is a significant safety issue. Just to put it in perspective, more people are killed on Highways Agency roads, which are only 2% of our network—a third of the casualties because of the density of traffic—than the number of people who are killed at work. There are health and safety issues at work, for which we have a whole organisation, the HSE, to ensure that such accidents do not happen or are minimised.

The Government need to have an answer to the question of who is liable for those accidents. There have been big improvements in road safety in the past 20 years. When I was Road Safety Minister we had a 10-year strategy and, by and large, that reduced deaths and serious injuries by about 30% over that period. That improvement has slowed down a bit since 2010, but we are nevertheless one of the best and safest in Europe and the world. However, there are still a significant number of deaths and injuries.

If you try to establish the causes of those accidents, there is an assumption that it is mainly driver error or driver behaviour—and there is some truth in that. Much of the improvement over the past 20 years has been in improved vehicle safety. The Euro NCAP programme has raised certainly new car safety features from what it regarded as 2-star to roughly 4-star—air bags and other aspects of car design—which has had a major impact.

It is also true to say that at least for most groups there has been some improvement in driver behaviour, but there has not necessarily been the same improvement in safety features in the physical design of roads, nor has the improvement been reflected in the objectives of road-building organisations—principally the Highways Agency, but also the local authorities. The reasons for this are partly because it is thought that if you build a better road, safety automatically improves. It does not necessarily do so, and certainly does not improve proportionately. It is partly because the system for appraising new projects—whether they are intersections, main road widening or whatever—includes safety elements that are but a small proportion of the total cost and benefit. Additional safety factors are therefore discouraged by the way in which the projects are appraised.

This group of amendments, which also relate to environmental issues, attempts to write safety issues into different points in the Bill. I imagine that the Minister will not accept the amendments as they stand but I advise her and her colleagues that road safety is underplayed in the Bill. At various points in the Bill, explicit reference to road safety and reducing accidents needs to be reflected, as well as in the licensing conditions and the standards and objectives that the Secretary of State accepts for the new company.

My worry about the transposition in this context is that if a road design issue causes or contributes to the cause of an accident, who is liable? We do not get many legal cases about the state of the roads, and I do not know why. Thirty years ago we did not get many legal cases about the performance of the National Health Service; now we get lots of them. We get quite a few about tripping over the pavement, which is the equivalent responsibility for the local authority. If you have an independent company, the question of liability to potential litigation needs to be taken into account as one of the risk factors. I am not saying that it is a determinant risk factor, but it is something that the Government will have to have an answer to, and at the moment I do not think they do. One way of ensuring that that happens, in terms of licence conditions and the other oversight that the Secretary of State will have to perform, is to write safety in at several points in the Bill.

With regard to the detail of the individual amendments, Amendment 18 relates to the standards that the Secretary of State can set for the company. One of those standards should be a reduction in the number of accidents and the number of people killed, and that should be,

“a central objective of the Road Investment Strategy”.

Amendment 22 makes the point that I was just referring to, that when you appraise schemes, the appraisal for safety benefits or otherwise needs to be a separate assessment and not be lost in the overall assessment, because the return you can get on safety measures is often much higher than the return you get on time-saving and other economic benefits. Amendment 22 also goes into other issues of reducing traffic and so on, which also have high returns. It is the same in the energy sector: saving energy is actually a far greater return than spending money on new power stations, although you have to do both—as you do here. But if you appraise the environmental element separately, the rate of return is significantly greater. Therefore, that should be done as a matter of course.

Likewise, in relation to the strategy in Clause 2, Amendment 33 says that the objectives should relate not just to road-building but to safety issues, and that in relation to guidance due consideration should be given to road safety and environmental outcomes. I would particularly emphasise the road safety dimension.

These amendments may not be the most appropriate place, but before the Bill leaves this House it would be sensible for the Government and the department to find the appropriate place to put, in lights, “road safety responsibilities of the new company”. If we let it leave this House without that being clear—in several different places, I suggest—there will be a tendency for the company to at least downgrade those and for the accountability of the company to be weaker because they have not been spelt out in the Bill.

These are quite important issues. Sometimes those who are keen on having new roads regard safety issues as a constraint rather than an objective of road design. We need to ensure they are an objective both at the individual project level and in the overall strategy. I beg to move.

[Lord Berkeley]

My Lords, I support my noble friend. He has raised some very interesting challenges. I do not think that safety gets taken into account nearly enough in the design of roads. In my earlier life, I designed quite a few of them.

It might be interesting to compare how the roads have developed and how the railways have developed. There were some horrendous accidents on the railways in Victorian times, starting off with a Member of Parliament who got crushed by one of the first trains because he was standing too close to it, or something. That led to the introduction of the Railway Inspectorate, whose job it was to ensure that the railways were safe, bringing in things such as brakes, which are quite useful. Things have moved on a bit since then. The Railway Inspectorate was originally staffed by retired Army officers, but more recently it has moved to the Office of Rail Regulation, which is the right place for it. I think that it does a very good job. We will be talking about some of the issues around that when we discuss a later amendment.

It seems to me a good idea to look at whether the ORR in its expanded role could take on some road safety issues. At present, the Highways Agency does that, and, in the absence of any other instructions, the new body will probably hold much the same views as that agency—namely, the desire to increase speeds so that people can get to their destinations faster and to increase capacity by having more roads. The strategy is designed round the concept of “a minute saved”. My noble friend is an expert on this. He may well be right that that body takes safety into account to some extent, but I am not sure that it does. It could certainly do so to a far greater extent.

The Office of Rail Regulation could be given responsibility for many of the safety issues that my noble friend raised, which cover a multitude of sins, and could be given a duty to look at the potential for modal shift. We talk about road to rail very frequently, but there is the issue of road to bicycle. As we have seen in London, road to bicycle is concerned largely with safety issues. A terrible number of cyclists have been killed in London in the past year or two. TfL talks about redesigning roundabouts but one of the key issues, which must be obvious to most people, is that if you give cyclists space, they are less likely to get run over. If the road traffic speed is set at 20 miles an hour, it is a great deal safer than 30 miles an hour, and you will get more people cycling and fewer people trying to drive. It would also reduce emissions and do all the other good things that we have been talking about. This is to do with modal shift. The journey time issue is equally important, whether you travel by bike, train, car or bus. Therefore, my noble friend’s amendments deserve careful consideration. I will discuss with him in more detail whether the Office of Rail Regulation should be involved in some of these issues. I think that body is capable of it as it has very capable people. Unlike the Highways Agency, it can stand back and take a different view and, if it does not like what is going on, it should be able to enforce and encourage change. These are important amendments and I look forward to further discussion on them.

--- Later in debate ---

[Lord Whitty]

My Lords, I have an amendment in this group. I agree entirely with my noble friend Lord Davies on how we get to the investment strategy. My amendment is at the end of this group, and it is about Parliament’s oversight of the process. We always ought to consider how Parliament both approves and monitors bodies and documents which are referred to in legislation.

I am proposing that, before the first strategy is implemented, it should be subject to a report of a Joint Committee of both Houses. I suspect that our colleagues in the House of Commons will say that it should be a DfT Select Committee. Nevertheless, some form of parliamentary accountability is necessary. It is nowhere in the Bill, and it should be. It should be a regular process; I am saying every five years because that is the period to which the money and strategy initially relate. Certainly, a regular review of the roads investment strategy ought to be built in at parliamentary level. That will complement the consultations that are required at the beginning of the process in my noble friend Lord Davies’s amendments.

[Lord Berkeley]

My Lords, I have two amendments in this group. Amendment 26 is more about who should be consulted. I expect the Minister will say that she does not like lists and therefore we should not have them, but as my two noble friends have said, it is very important that the Secretary of State should consult organisations that are affected, including,

“Network Rail … local transport authorities … combined authorities … statutory environmental bodies”,

and anyone else that the Secretary of State thinks is important. It is very important that this should happen. If it is going to happen, that is fine, but it is very important that it does.

With regard to Amendment 31, on Part 2 of Schedule 2—“Varying a road investment strategy”—it seems more appropriate to make use of the Planning Act 2008 provisions and apply them to the road investment strategy as if it was a national policy statement. My amendment would bring it all together in a national policy statement structure rather than the one in the Bill. I do not think I need to explain it any further. I look forward to the Minister’s comments.

Enterprise and Regulatory Reform Bill

Debate between Lord Berkeley and Lord Whitty

Tuesday 18th December 2012 Grand Committee

[Lord Berkeley]

I am grateful to the Minister for that clarification. I still think that £15,000 a day for a big company is chicken feed; they will not notice it, even if it goes on for several years. I am no expert at levelling fines but I have been investigating the potential level of fine, admittedly on the Government, but it concerns the Thames Water tunnel outside here. The figure being bandied around there is £1 billion if we are lucky. That is a project that is worth £4 billion, and maybe there is a company with a turnover of £4 billion involved in this competition issue. The figure seems to be slightly low and out of proportion. I do not know whether it is a deterrent. Perhaps the Minister could reflect on whether a percentage for a daily rate would not be an additional deterrent.

[Lord Whitty]

My Lords, I am grateful to the Minister for clarifying that; I was getting a bit confused myself. If he had been right first time, my amendments would not have been necessary. I accept that there is a daily rate and that is an important consideration. I am sorry to part company with the noble Viscount—I am sure that we will be back on the same course at some point—but you need a deterrent in these cases. The question is what level of deterrent is effective enough to ensure that you will never have to impose it. It seems to me that these amounts are a bit low, given the size of the markets that we may be talking about.

I hope that the Government look at this again. Among other things, they will probably find that some of the sector regulators have tighter powers on the disclosure of information than this. I think I am right in saying that Ofwat does, for example, in relation to misleading information. I declare a brief past interest: I was on the board of Ofwat for a short period. We will probably find that these are rather minimalist maxima and they could do with further review. I beg leave to withdraw the amendment.

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[Lord Berkeley]

Before the noble Lord sits down, I have a question in relation to these time periods. I have had a little experience of trying to do something like this in the railway sector. My recollection is that a long time is taken between when the notice is issued saying that the authority will conduct such a study and when it has sufficient information to allow the clock to start running. Reading the Bill and my noble friend’s amendments, I am not sure whether these numbers—from six months to four months—apply to the time between the notice being issued or where the clock starts ticking and the authority believes that it has sufficient information. Maybe my noble friend has more information on this, but it is a point worth looking at when we come back to it.

[Lord Whitty]

My Lords, in reply to my noble friend, Lord Berkeley, the point would be from when the clock starts rather than just a twinkle in the eye of the regulator. I accept that everything is a little arbitrary to some extent, but if we are trying to turn the screws and stop us from being seventh out of eight of the competition authorities within the larger countries in Europe, we should take every opportunity to speed things up. If the Minister wishes to have another look at this, I would be grateful. I beg leave to withdraw the amendment.

--- Later in debate ---

[Lord Berkeley]

I am grateful to the Minister but I wonder whether, within his broad canvas, or whatever, he has any views about whether any secondary legislation will be introduced on the issue which may or may not be helpful. I noticed that within this group there is the Question that Clause 40 stand part and Amendment 26BF, in the name of my noble friend Lord Whitty. I would be pleased to hear what he says about that because I have some comments on it too.

[Lord Whitty]

My Lords, I was going to leave that because my Amendment 26BF is an attempt to tidy up the provisions on review, along with another amendment that I cannot find immediately. There are separate provisions on the mergers, the markets and the anti-trust provisions, as to when we review them. I am in favour of the Government’s policy that we review legislation every so often but I think that it should be done simply and that we should look at the whole of the legislation. Essentially, that is what Amendment 26BF to Clause 48 is about. I was not going to move it today because I think that it requires the interplay of other parts of the Bill but I think a review of the totality of the Bill, all at the same time, would be helpful and should be built into the Bill in some way at a later stage.

--- Later in debate ---

[Lord Whitty]

My Lords, I am extraordinarily grateful to the Minister for accepting that Monitor should come out. My amendment was to the original version of this amendment, and I thought that I would have to make that speech all over again. Luckily, as he has pointed out, it has been removed. I am glad that the Government took my advice on that; I think that they should remove any reference to Monitor anywhere in the Bill, and I hope that they will do so.

My only other point regarding the list was that we need to make some reference to financial regulators. Although, as I have said before, the Financial Services Bill has not yet received Her Majesty’s assent, we are in a position where we will have a Financial Conduct Authority and a Prudential Regulation Authority under the auspices of the Bank of England, which may well be taking measures that affect the structure of the financial sector. Therefore, although I am not suggesting that there be a reference to the FCA or the PRA, there should be some reference to the concurrency with the financial sector, albeit that the concurrent powers are not quite the same. So there is still a little issue with the list.

The more general problem with what the clause provides, however, is quite an important one. I am happier with the original clause that encouraged the sector regulators to use their competition powers. Actually, that clause merely requires them to consider using the competition powers; the noble Lord’s letter said “instead of” their sector powers, whereas they need to see which powers are best. The clause is fine on that, so I approve of the clause. However, I do not approve of the government clause that the Minister has just moved. It relates to the relationship between the sector regulators and the CMA, and that is clearly going to be crucial. We touched on this a few times earlier; indeed, my noble friend Lord Stevenson referred to it under the first amendment.

We need to change the present system. Frankly, some of the sector regulators have been overdefensive about their role with regard to using competition powers themselves, rather than their more familiar sector-specific powers relating to licences, franchising and so on, and very resistant to any suggestion that the Competition Commission should look at the competition structure of their sectors as a whole. On the other hand, it has also been true that both the Competition Commission and the OFT have been somewhat loath themselves to intervene in regulated markets, although I know that at one stage the Competition Commission was quite anxious to look at the energy market, with which the Minister is very familiar, but Ministers helped Ofgem to resist that. As I understand it, that was the position under both Administrations, and that needs to be addressed.

However, while the relationship between the two does need to be restated, the Minister has used the nuclear option. I assume that, like the nuclear deterrent, he is hoping that it will never be used, but it will mean compliance by the sector regulators, which will be using their competition powers more frequently, or they will meekly be prepared to hand over cases to the CMA under the threat in this amendment that their powers will be taken away by the Secretary of State completely, either on a particular issue or in total. That does not seem on its own to be the correct approach. We need the big print to be about co-operation between the CMA and sector regulators.

Amendment 26B would give the Secretary of State draconian powers to reduce the whole role of sector regulators and leave them with only their sector-specific powers. That is counterproductive to what we were trying to achieve, which was more use of competition powers with all regulators.

As my noble friend Lord Stevenson suggested this morning—or, rather, this afternoon; it just feels like this morning—we need a more co-operative approach between regulators. Unfortunately, the Minister rejected the particular option proposed by my noble friend at that stage.

In this group, we propose another option with Amendment 26BD. That requires a memorandum of understanding. Some of that exists already, but it will need to be boosted between each of the regulators and the CMA. It would eventually allow the CMA to ask the Secretary of State to require the CMA to take over provisions—again, either in a particular case or more generally—but that would be after a period when a co-operative and conciliatory memorandum of understanding had been working. That requires joint working, sharing of information, and so forth. This would still allow the CMA to conduct periodic reviews into how this was going with the sector regulators, but it would be far preferable to the nuclear powers that the Minister’s amendment gives to the Secretary of State.

I hope that we could accept this more conciliatory approach. I also hope that, even if the Minister’s amendment still stands and ours does not, the two amendments to his amendment, which would require the Secretary of State to give reasons for his action and to take note of the CMA's periodic reviews, would at least add a more objective context and require the Secretary of State to go through a significant number of hoops rather than jump straight into taking powers from the sector regulator. It is a more constructive approach. I prefer our amendment but, if the Minister is not prepared to accept that, the amendments to his amendment should be accepted.

This is a delicate area and one in which the CMA’s relations with the sector regulators will be very important. We could get it horribly wrong. The big stick that the Minister’s amendment implies is probably not the right way to be going about it. I beg to move.

[Lord Berkeley]

My Lords, I share my noble friend Lord Whitty’s serious concern about Amendment 26B. It goes to the heart of independent regulation. As I recall, going back a long time now, these regulators were created to be demonstrably totally independent of the Government. The Secretary of State probably appoints the chairman, but he cannot remove him unless he does something very naughty, bad or financially uncertain.

The principle of independent regulation without government interference—and Governments of all hues have a pretty bad reputation about interfering in different things—is fundamental to the operation of a regulated monopoly or series of monopolies. That is certainly the case in the railways and Network Rail, and to some extent it is the case in the water and power industries

Electricity and Gas (Internal Markets) Regulations 2011

Debate between Lord Berkeley and Lord Whitty

Monday 17th October 2011 Grand Committee

[Lord Berkeley]

My Lords, I apologise to the Committee for not getting here at the start of these proceedings. It is a terrible thing to say, but I went to the wrong room and got lost.

My interest in this issue stems from talking to many ports and airports around the country. I recall having correspondence with Ministers a few years ago on one issue in particular. Ports and airports which already had a network might have tendered out the supply of electricity to get the best deal for their various tenants, but if one tenant decided to go to another supplier then, in order to comply with the directive and the Citiworks judgment, the port could not stop them. This may be fair enough but the port might then be saddled with the very high cost of upgrading its internal electricity network to grid standards. I know that Ministers at the time—I think it was before the election—understood the problem, but it has not gone away. It seems that there is something of a rush about getting this through, which I cannot believe is happening in any other member state. Can the noble Lord tell me whether any other member states are implementing these regulations at the same speed as we are?

The costs of doing this, whether capital cost or anything else, and the pricing methodology for assessing the charges, worry me and this needs further discussion. It is good that, at the seminar on 9 May, Ofgem announced a helpful concession to allow a higher capital cost figure to be taken into account in assessing the charges. However, these additional costs cannot be taken into account in the case of the input of the opt-out on existing bulk purchase contracts, where the local network provider has committed to a minimum threshold. This seems rather unfair. If a port has put in a network and negotiated a bulk electricity deal, then half its tenants decide to go somewhere else—which they can do—it is left holding the baby with quite a big loss. One port told me that if all this went ahead and it was forced to implement it, it could lose in the region of £10 million a year. That seems a very high figure. There is clearly no way to stop this and it is probably right that tenants should be able to choose to buy power where they want. However, the cost of such a change should be borne by the tenant who wants to make the change, rather than by the landlord losing out.

Ports and the port businesses are also being hit by the carbon reduction commitment, which, as we know, is a tax on energy used by businesses. CRC is currently payable in respect of all business electricity users on port estates, even when they are below the minimum usage threshold for paying it. This may encourage more tenants to opt for third-party suppliers, which also puts more pressure on the port. Could the Minister see whether these effects can be mitigated, either through further discussion with Ofgem or further meetings with airports and port operators, to try to redress some of the adverse effects that are perceived at the moment?

[Lord Whitty]

My Lords, I broadly support the second package and the transposition of it. However, it leaves a few loose ends, and I want to raise three points, one of which relates very much to what my noble friend Lord Berkeley just mentioned: inclusion in the need to provide access for consumers and businesses those who are licensed for local networks.

I am in a dilemma here—no doubt, so are the Government—in that if you are locked into a local network and there is no alternative supplier, choice does not apply. On the other hand, if you open it up to choice, as the noble Lord explained in relation to ports, the economics of the local network change. There is a real problem here. I ask whether that would apply, for example, to a relatively small CHP system on an industrial estate where all the other units on the estate had agreed to sign up and the economics had been worked out on that basis; or indeed a residential district heating system—I am very much in favour of both such developments of localised and decentralised energy. Opening that up to competition or to the secondary user's choice of supplier makes the economics much more difficult. That is a dilemma. Two principles clash here: one of encouraging decentralised energy and the other of consumer choice. Simply including them under the same obligation as the big network suppliers does not resolve that. I am no closer than the regulations—or, probably, the department—to supplying a solution, but it is not supplied by the regulations.

My second point relates to the reference to consumer protection and Consumer Focus. I declare my past allegiance as former chair of Consumer Focus and—although this applies more to my third point—as currently undertaking some work for the Consumer Council for Northern Ireland. The requirement for Consumer Focus in part 2 to provide a consumer checklist is an extension to what is provided in the Consumers, Estate Agents and Redress Act 2007. It is a more prescriptive requirement on Consumer Focus—the National Consumer Council, in legal terms—than exists under that Act. Even in its current form, one could say that it is an incursion on its independence. The organisation already supplies significant guidance and information available to consumers. However, on balance, I do not object to the current setup.

As the Minister will be aware, under the Public Bodies Bill it is intended to move the role of Consumer Focus on energy either to a third-sector organisation, Citizens Advice or—another proposition currently in play—to Which?, which is, for these purposes, a private sector non-profit-making organisation. Is not the requirement for it to do the job in a certain way an even greater imposition on an independent organisation than it is on a quango? Is the Minister clear that such a requirement would survive a transfer of those functions to organisations that have not been in this game before and that have their own charitable and, in the case of Which?, slightly different structure of obligations and priorities?

Clearly, it is a bit of a problem to get the current powers of what was Energywatch and then Consumer Focus into a completely non-governmental organisation in the first place, but the more prescriptive that that becomes the more difficult it is to ensure that the provision in these regulations survives such a transfer.

My final point relates to Northern Ireland, to which the noble Lord, Lord Dixon-Smith, already referred. He seems to think that this lets Northern Ireland and the separate system of regulation off the hook. I am sure that in Northern Ireland he would be relatively happy for that to be the case, but my understanding is that there is concern about this over there because Northern Ireland organisations are not party to the ACER set-up. There can be only one regulator there, and the energy market there is very different to ours. The gas side is on an all-Ireland basis or is pretty much moving towards that. The Irish regulator would be there but not the Northern Ireland regulator. There are different structures of competition and supply. The regulations are not necessarily appropriate to a very different sort of market with a different sort of fuel supply. I should like the situation on Northern Ireland to be clarified—if not today, then at some point in the near future—because there seems to be a bit of a lacuna in the set-up.