Passenger Railway Services (Public Ownership) Bill

Debate between Lord Sikka and Lord Moylan

Committee stage
Wednesday 23rd October 2024 Lords Chamber

[Lord Moylan (Con)]

My Lords, at this hour I would like to expand considerably on my noble friend Lord Young of Cookham’s remarks on his amendment, but I find there is nothing I can add, given how well expressed his argument was technically. I shall say only that I hope the Minister, by contrast to his response to the previous group, will recognise the serious balance sheet issues that arise in relation to lease obligations. I understand that, while the department currently recognises its obligations to the end of the current contracts, most of which are a matter of months or very few years away, when the responsibility transfers to the Government, they will be responsible for the lease payments for the whole of the life of the remaining contracts for the lease of the trains and these will therefore represent a balance sheet liability, not simply an ongoing cost, that may well need to be recognised. I am not, as I say, as proficient in these matters as my noble friend, but I hope very much that the Minister treats that seriously and gives us a proper and robust answer about how this is to be treated.

I shall save the bulk of my remarks for the amendment moved by the noble Lord, Lord Sikka, with which, it may surprise noble Lords, I have a great deal more sympathy than they might expect, certainly as far as his analysis is concerned, though not necessarily with his solution of total nationalisation and so forth.

The fact is that there is a very large amount of capital in the world, and a capital is seeking a return. However, this capital is not buccaneering 19th-century capital of the sort that built the railways in the first place; this is not capital that is looking for investments at risk; and this is not capital that sees that it might win a large prize on one investment in its portfolio but is willing to tolerate the total loss of another investment in its portfolio. This is capital that is looking for risk-free returns—or returns that are close to being risk free—but at a rate of return that is considerably higher than it would achieve if it invested in government bonds.

Such capital is to be found throughout our economy—this is a criticism not of the current Government but of the previous Government and of the Labour Government as managed by Gordon Brown—because it is the basis on which funding is now provided to most of our utilities. That is why they all belong to large, foreign—although they are not necessarily foreign, and I do not object to the fact that they are foreign, so I will drop that word—investors who are looking for super returns and are achieving them because the Government are so accommodating towards them.

The noble Lord, Lord Sikka, asked why the Government do not do something about this and why they do not nationalise the roscos as well. That would be a true nationalisation. As I said at Second Reading, this Bill is not really a nationalisation of the railways; as I said in Committee on Monday, it is more like dismissing your chauffeur at the end of his contract. That is all that is really happening. If you are nationalising something, you normally have to pay for it and you normally acquire assets. That is not what is happening here, because the assets are all left in the private sector. The Bill’s headline claim of nationalising the railways—after all, that is the main purpose of this Bill: to get a headline out there quickly—is largely bogus. The main reason that the Government are not acquiring the roscos is that they cannot afford to do so.

There is a second reason that the Government are not acquiring the roscos or going even further—as I suspect the noble Lord, Lord Sikka, would—by seizing their super profits and acquiring them at a price that would reflect a reasonable rate of return closer to the risk-free rate of return for the rest of the period of their leases. That reason is that this Government, rather like the previous one, are wholly dependent on that source of funding for nearly every infrastructure project that they want to carry out, be it railways, environmental stuff, net zero and so forth.

In fact, there was a great conclave of these investors only a week or so ago, at which the Government told them what wonderful prospects they would have with their super, close-to-risk-free returns if only they would invest in Britain. It is not that we will get less of this sort of finance that is so objectionable to the noble Lord, Lord Sikka, under this Government; we will get a great deal more of it. That is the simple explanation, whatever the Government say, as to why they will not do what the noble Lord would like them to do, and which anybody who values true competitive capitalism would also consider to be moving towards terminating an outrage.

[Lord Sikka (Lab)]

My Lords, I do not want to reply to the noble Lord, Lord Moylan, because I would be here all night picking holes in every point he made in reference to me.

Perhaps I may help the Minister out. The noble Lord, Lord Young of Cookham, talked about the liabilities of Network Rail. The composition of government debt published by the ONS includes the liabilities of Network Rail, but the assets acquired with that debt are excluded. That means that the government debt is overstated. In a balance sheet, you will have assets and liabilities. In the ONS approach, only Network Rail’s liabilities are included in the debt. I understand that, for quite a long while, the Treasury has been looking at reconfiguring the composition of public debt, and I very much hope that, soon, it will do the proper thing by either taking off the debt altogether from the ONS numbers or including Network Rail’s assets as well.

Higher Education (Freedom of Speech) Bill

Debate between Lord Sikka and Lord Moylan

Report stage
Wednesday 7th December 2022 Lords Chamber

[Lord Sikka (Lab)]

My Lords, I am grateful to the noble Lord, Lord Moylan, the noble Earl, Lord Lytton, and the noble Baroness, Lady Bennett of Manor Castle, for their support for this amendment. I raised the subject of academic integrity and freedom to disseminate research findings at Second Reading and in Committee. Several important issues were raised, and this amendment has been extensively rewritten in light of that. I believe that it now complies with Article 10 of the ECHR.

The revised amendment prevents the gagging of academics by research funders who do not like the findings. However, the right to publish research is also constrained by my amendment’s proposed new subsection (3), which basically states that, if the research findings would

“threaten national security, public safety, or health”,

they need not be published. They also would not if

“the contracting parties to a research funding arrangement agree confidentiality of results in advance.”

Major issues were raised during the last debate, and I will address them.

In Committee, I provided examples of how the Government themselves suppressed Covid-related research findings, for which we are yet to receive a full explanation. The research was funded by public money and did not threaten national security or public safety, but it was still suppressed. The publication of that research could have provided insights into the cost of Covid tests and of controlling the pandemic, and possibly have helped to frame more effective public policies.

I also cited examples of the tobacco and food industries censoring or preventing the dissemination of research. The unhindered publication of academic research would have created greater awareness of the dangers of smoking and the ill effects of processed food, and, again, this may well have enabled the development of more informed public policies.

Research showing that generic drugs are just as effective as branded drugs would have reduced the cost of medical treatments, as well as the cost to the NHS. In Committee, it was suggested that my amendment was somehow not appropriate for the Bill, and that transparency was a key issue. I will tackle that head on because I am happy to respond to these points. The amendment is about academic freedoms, and the clue is in the title of the Bill, which includes the words “Freedom of Speech”. Advancing and protecting the academic freedom to publish uncensored research is directly relevant to it; there is no other Bill where these kinds of issues can go at the moment. The point about transparency is important, but the unhindered publication and dissemination of research is the best form of transparency.

Over the years, I have been on many academic journal editorial boards, so I am well aware of the politics of publishing and commissioning research and so on. All reputable peer-reviewed journals require authors to disclose sources of research funding and to make the relevant data, wherever possible, available to other scholars. However, that point can be reached only when a scholar submits a paper for publication. If research funders supress the findings, a submission to a journal does not take place, and the data cannot be provided easily to other scholars—you need not necessarily disclose who the funders are, because that point is not reached. If research findings are diluted by the funder, the researcher has the option whether to accept the diluted paper and proceed to publication or not. If the researcher chooses not to proceed to publication, there will be no transparency about funding at all. If the researcher succumbs to pressure from the funder and accepts the dilution of research outcomes, he or she is unlikely to be permitted to say that the funder rewrote or took out large chunks of the paper. So there is no transparency about the pressures which prevent the publication of the paper, which is what I am really concerned about.

Of course, there are numerous research registers which list the grants obtained by scholars, but a mere listing of the source does not amount to transparency because it does not tell us anything about the gagging of those researchers or prevention of their publication. Just naming the funders does not tell us about the contents of the research, research methods, research methodology, analysis, discussion or possible public implications.

Full transparency, which is what I am concerned with, covers all those things, and that can be provided only by publication of the research, not permitting funders to say that you cannot publish it because, somehow, they now feel that it would damage their reputation or reduce the revenues arising from the sale of tobacco-related products or processed food. Gagging comes in many guises; it is not simply somebody saying that they will not let you publish—they behave in all kinds of interesting or strange ways.

I shall give a personal example. For a long time, I have taken an interest in auditor regulation. Under the Companies Acts, a resigning auditor is required to issue a statement addressed to shareholders and creditors stating whether there are circumstances in connection with that resignation that shareholders and creditors need to be aware of, then to list them, or to say that there are no circumstances and leave it at that. What do the auditors actually do? I conducted the only piece of research on that over the past 100 years, and I looked into it. I learned that Companies House does not publish the data, but on inquiry it said that it could write a piece of software for me, interrogate its database and tell me which company auditors had resigned. This was in relation to public limited companies. In those days you had to buy microfiches, so I would have had to buy the microfiches and track down whether there was a letter of resignation from the auditor.

I got the data and approached the Institute of Chartered Accountants in England and Wales and asked whether it would help to fund the cost of writing the software and buying microfiches. I got the grant, and I looked at all 800 auditor resignations relating to public limited companies. What did I find? Only 2.5% of the resigning auditors complied with the law. The other 97.5% were silent; they did not say anything. But roll forward a few months and I started looking—and what do I find? In many instances, the auditors got out quietly but there was a scandal, with major frauds and other kinds of corporate collapses, which suggested that the auditors had basically abdicated their duty. They did not want to say anything or get a bad name for being troublesome, which is not very helpful for getting new audits or consultancy work.

I submitted my report to the Institute of Chartered Accountants in England and Wales, which said that it would get back to me. That is what is required—you submit a report. Would it say that I could go ahead to publish or say that I could not? It said neither yes nor no, and meanwhile the research was getting stale, and I had to make a decision. Was it important enough for people to know what auditors were up to, or should I just be quiet? I decided that I would publish the research, and it was published as a research monograph. Needless to say, I never got a research grant from the ICAEW again. The public suffers.

That is just one example of how people are gagged. Not everybody wants to follow their conscience and just publish. What I am trying to do through this amendment is to empower academics so they can publish research that is vitally important. There is nothing in the Bill that prevents gagging of scholars through subtle or not so subtle forms of silencing. We all see the world by standing on the shoulders of intellectuals. The barriers to publication of research prevent us seeing things, and this amendment would lower those barriers. I beg to move.

[Lord Moylan (Con)]

My Lords, I speak in support of Amendment 23 in the name of the noble Lord, Lord Sikka. I said at Second Reading that there was a lacuna in this Bill, in that it did not deal with finance and money. Finance, of course, is what makes the world go round, and the scope for using money to limit freedom of expression and academic freedom is obvious. It hardly needs to be explained. So why would a Bill that addressed academic freedom not deal with this question of money and its potential abuse?

Quite independently of the noble Lord, Lord Sikka, in Committee I tabled three amendments trying to cover such aspects as the use of donations, the use of research grants and a couple of other matters which I thought were worthy of debate. Independently, the noble Lord, Lord Sikka, tabled an amendment much along the lines of the one he has just spoken to. As we proceed to Report, I have dropped mine, but the noble Lord has refined the drafting of his amendment considerably, and it is now a very good amendment and one that I think deserves a response. Sadly, in Committee, I do not feel it had quite the response or the engagement from either Front Bench that this important topic deserves.