Network Rail

Debate between Lord Walney and Kelvin Hopkins

Thursday 2nd February 2012 Westminster Hall

[John Woodcock]

That is an interesting point. We should examine repeatedly how such incentive mechanisms work.

In the case of cable theft, increased action and a tougher regulatory system are needed to enable Network Rail to perform better. Of concern is that it took so many instances of main lines and major stations coming to a halt before the Government were spurred to what we hope is greater action. Even though Ministers now seem prepared to legislate for a ban on cash sales of scrap metal, at the moment their actions fall short of what is required to end the scourge of thefts. Cashless transactions alone may prove too easy to circumvent. We need a licensing system for scrap metal dealers, strengthened police powers to enter premises that they suspect of selling stolen metal and to close such premises down if necessary, and a requirement to show verifiable identification, recorded at the point of sale, for all transactions.

Ministers still have an opportunity to put more comprehensive measures in the Legal Aid, Sentencing and Punishment of Offenders Bill. They would have cross-party support in doing so. I am talking about measures that would genuinely put an end to the spiral of delay, disruption and extra cost being experienced by passengers and freight customers across the network. I hope that the Minister will outline whether he is prepared, from a transport point of view, to put pressure on his Home Office colleagues to go further on the matter.

There is a need for improved performance from Network Rail in areas over which unquestionably it has control. Those areas include the reliability of signalling systems and better management of planned shutdowns to limit overruns having an impact on the next day’s passenger services. Performance is highly variable across the network. Far more needs to be done to ensure that good practice is learnt from by all Network Rail regions.

There is real scope to improve performance by reforming the artificial barrier between track and train—one legacy of the botched privatisation of the railways. However, there remains real confusion about where the Government are heading on that. Originally, Ministers proposed handing over infrastructure to the private sector, raising questions about whether they had truly learnt the lessons of the Hatfield crash. Will the Minister make it clear whether they have abandoned those plans? In the absence of the much-delayed Command Paper, the confusion drags on, so will the Minister tell us when we can expect to see that Command Paper?

We also have concerns about something that has so far not been brought to the House but on which newspapers have been briefed, which is the Minister’s new idea about creating single management companies out of Network Rail and train operating companies, starting with a potential partnership with South West Trains. The Minister needs to say how a level playing field will be ensured when such franchises come up for renewal. How will other train operators, both passenger and freight, that use that part of the network fit into the alliance? How does the balance between a for-profit train operator and the not-for-profit Network Rail work in that context?

Hon. Members are right to focus on the need to improve efficiency. As part of that, we need to make procuring and building improvements more efficient without compromising safety. I have spoken to train operating companies, and a number of them have expressed concerns that having to use Network Rail to procure improvements to the non-safety-critical parts of the railway system, such as station buildings and car parks, significantly pushes up the costs of and delivery timeframes for those improvements. Will the Minister expand in his winding-up speech on plans either to allow TOCs to procure such works independently, or to ensure that Network Rail improves its processes?

A number of hon. Members raised, quite rightly, the issue of investment in various parts of the rail network. However, the way in which we currently manage investment in the railway system and, indeed, across the transport network needs to change. We need longer-term thinking that goes beyond artificial five-year horizons. We have a reasonable idea of where the pinchpoints in the system will be in decades to come, the capacity challenges and the emerging markets for new or faster services. We have had, for example, welcome albeit piecemeal announcements of funding for electrification. So far, that applies mainly to schemes developed by the previous Government. However, the five-year horizon of planning means that the Government are hindered from creating greater certainty about a rolling programme of electrification, which, at its best, could guard against the resources and skills employed by schemes such as the Great Western and north-west wiring schemes being lost at the end of those programmes rather than being moved to the next area, such as the midland main line or the Great Western route through to Swansea.

Labour is not calling for extra spending on rail in this comprehensive spending review period, but we do want the five-yearly assessment of what is affordable to be part of a longer plan for what is desirable and likely, so that industry can plan and British manufacturing can have the best chance of winning contracts.

[Kelvin Hopkins]

My hon. Friend is rightly emphasising costs, but a lot of the costs have to do with the method of contracting and sub-contracting that has been in use since privatisation. The contrast with British Rail is extreme, but there is also the contrast with costs abroad—other railway systems on the continent of Europe. Is that not something fundamental that we have to look at to bring those costs down, not just marginal changes to improve efficiency a bit, because we are talking about a multiple of costs?

[John Woodcock]

I thank my hon. Friend for his intervention. He is right to say that we need to look across the board at all options for improving efficiency. Avoiding inefficient procurement decisions, without returning to the days of the railway system that existed before the botched changes were made, which was not in itself operating efficiently, is the challenge and would be the challenge for any Government seeking to produce real, lasting and effective reform.

The deficit of accountability and transparency has rightly dominated speeches today. They have been powerful and well directed, but before I say more about where we share concerns in that respect, it is important to stress how far we have come since the days of Hatfield. Network Rail’s unusual structure was forged in response to the failure of its predecessor, Railtrack. The Labour Government were right to take action to bring the management of our rail infrastructure back under control, but the simple fact that we are in a relatively better place today does not mean that we can or should ignore the problems and shortcomings that beset the organisation a decade on.

The unusual nature of Network Rail has created a deficit of accountability. It does not have shareholders and does not respond directly to elected politicians, as has been demonstrated today. Most importantly, it is not properly responsive to the passengers who use the railway system. That can leave it unable properly to serve businesses, passengers and communities alike, and allow inefficient practices to continue. It has given rise to the alarming allegations that hon. Members have aired today and on which I hope the Minister will comment in his winding-up speech. [Interruption.] He still has 20 minutes.