High Speed Rail (Preparation) Bill

Andrew Turner Excerpts

Wednesday 26th June 2013 Commons Chamber

[Jessica Lee (Erewash) (Con)]

The eastern side of my constituency, in the heart of the east midlands, borders the proposed site for the east midlands hub. I share that border with my hon. Friend the Member for Broxtowe (Anna Soubry), and I assure the House that as time goes on we will be working together on issues arising from the proposed site.

At this preliminary stage in the proposals for HS2, I speak in support of the project. That broadly reflects the representations made to me by businesses and constituents, although, it has to be said, not universally. On the current plans, the route clips the eastern edge of Long Eaton, and a few roads in the town will not survive. I will deal with the concerns of its residents later. I also have very many constituents who welcome and support these plans. They are right to do so. Put simply, the proposals offer a chance for investment and regeneration on a vast scale in our midlands and northern towns and cities. In Erewash we have a proud history of jobs, businesses and apprenticeships in the railways sector. My late maternal grandfather worked his entire life on the railways. This project brings new opportunities to continue that historical link. The possibility of being a neighbouring town to the east midlands hub has to bring much more with it.

I was recently privileged to bring the Minister of State on a visit to Long Eaton to show him the proposed route. I was very grateful for his generous use of his time to visit Erewash. I am sure he agrees that the opportunities for my constituency in terms of jobs and investment would be second to none. In addition, my right hon. Friend will have noted the road infrastructure in Long Eaton. I hope he agrees that this scheme could bring with it an opportunity to improve the road infrastructure for the town, because as it stands the roads would struggle to manage the new traffic levels.

As I said, some businesses and homes in Erewash would be affected by the proposed route. Of course, it is impossible for any of us to imagine someone’s shock and worry on hearing the news that their home may not survive the construction of the project. However, like many other constituency MPs, I take my responsibilities to assist such residents extremely seriously. I have called a meeting and have been helping on a personal, individual basis every constituent affected by dealing with their correspondence and any application they wish to make under the hardship fund.

I bring to my right hon. Friend’s attention the historical Trent cottages that I was able to show him, which are located on the route. The cottages were built in the early 1860s to serve the railwaymen working close to Trent railway station, which was built at a similar time. They are a historical record of Long Eaton’s railway past, and I ask him to have due consideration of this when reviewing the route.

I return to my starting point in welcoming the possibilities of this project. I take into account the proposed costs of the scheme and the environmental impact, based on the information that we have so far, but I also note the simple fact that we need to address capacity on our railway network. This project, with broad cross-party support, will be the biggest investment on our railways since the Victorian era. In the past 15 years demand for long-distance rail travel has doubled to 125 million journeys a year.

[Mr Andrew Turner (Isle of Wight) (Con)]

Is my hon. Friend aware that 1.5 million train journeys are carried out each day and that 56 million people never, or very seldom, travel on trains?

[Jessica Lee]

I thank my hon. Friend for his intervention. I hear his statistics, but I also look to the future. The broad fact is that we are reaching full capacity on our railway network. We can either ignore that or address it; I think we need to address it.

We also need to compete on a global basis. I will give just one example.

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[Kwasi Kwarteng]

I am pleased that we have Members with such fertile imaginations in this House that the hon. Gentleman has his own scheme. I have not looked at it, though, so I could not possibly comment.

What is clear to me, as a Member for a south-east constituency that is very built-up and highly residential, is that disputes about infrastructure spending are inevitable. I suggested that when the Tower of London was built, people objected to it on quite worthy grounds. There have been objections to every piece of infrastructure spending in this country for hundreds of years, but that does not mean that we have not gone ahead and built the railways or the ports. We are a commercial nation with incredible skills in engineering. We have, or we used to have, great architecture and engineering—I am not casting aspersions on current architecture, just suggesting that it was very good in the past—so there is no reason to suggest, as some have, that HS2 will be a blight on the countryside. It will change of course, but as has been pointed out, Isambard Kingdom Brunel and other Victorians completely transformed the landscape of this country, but they did not make it worse in any way.

[Mr Andrew Turner]

It was the private sector that did it, not the public sector.

[Kwasi Kwarteng]

I hear my hon. Friend chuntering from a sedentary position. We have an extremely interesting side of the Conservative party that refuses to countenance any Government spending on infrastructure. Happily, I am not of that wing of the party and recommend that both sides of the House come together in support of the Bill.

My final few words will be about the financing. Yes, £50 billion is a lot of money, but it will be spent over 20 years and, if one uses straight line depreciation, it is not much more than the infrastructure spend on Crossrail. I would suggest that HS2’s benefits are much more transformative than the Crossrail project’s, so on that basis alone, I urge colleagues to vote in favour of Second Reading.

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[Mr Andrew Turner (Isle of Wight) (Con)]

HS2 has been proposed as a solution to the problems we currently face. We are told that it is green, that it will deliver regional growth and that it will resolve slow journey speeds between British cities. However, all those claims are questionable. It is important that we highlight them before UK taxpayers are asked to foot the enormous bill of £32.7 billion.

HS2 will lead to an increase in CO₂ emissions. Its supporters insist that the project is carbon-neutral. However, according to HS2 Action Alliance, 250 mph trains use three times as much power as 125 mph trains. HS2 Ltd’s plans rely on transferring passengers from existing classic rail, which uses much less fuel and carbon, to high-speed trains. That means that the new line will have few, if any, environmental benefits.

We have also failed to learn lessons from High Speed 1. In Kent, Thanet remains one of the most deprived areas in England, despite being served by high-speed rail that runs direct to London. Even the experts are questioning the proposals. Professor Mackie of the university of Leeds has said:

“For various reasons HS2 is rather unlikely to make much difference to the north-south divide. A spatial analysis would probably show London to be the main benefiting region”.

It is unlikely that HS2 will deliver the regional benefits that have been promised.

London operates as a brilliant hub, and cities across the country have brilliant connections with the capital, but that should not be the focus of investment. Lines outside London need investment too. People do not travel out of London to work and then back again to sleep; the overwhelming majority come into London for work. Our European neighbours have had a similar experience. I will give just one example. In France, on the line connecting Paris, Rhone and the Alps, passenger growth to Paris was three times greater than that from Paris.

The only people who will benefit from the project will be those living within about a 10-mile radius of the station near Birmingham on the HS2 line. Those who live any further away, such as in the black country or Coventry, will be asked to travel more than 10 miles. Will people really be prepared to pay the cost of travelling to stations more than 10 miles away? Even if subsidised travel is provided, why should 99% of people have to pay for the 1% who use the line?

[Mrs Anne Main (St Albans) (Con)]

Does it not seem rather perverse that we are reducing the amount of public subsidy for some commuters, such as those who take the line from my constituency to London, while putting massive public subsidy into another line? It is very much like cherry-picking.

[Mr Turner]

I must agree. Only a very small percentage of people use trains regularly. As the Transport Secretary has said, 10 million people travel annually on HS1, or about 30,000 people a day; another, say, 1.5 million people travel on all the other trains. What is the number of those not travelling? Practically everyone else in the country—59 million, say. That is the difference: 1.5 million on the one hand and 59 million on the other.

Another argument in favour of HS2 is that current trains are too full and the project will provide the opportunity to increase capacity. I disagree. If trains are currently too full, why not put the prices up? The way to make that fair would be to say to current regular commuters, “Yes, you can keep the current rate but a new user of the trains should be required to pay a bit more.” That would encourage further growth and investment in towns and cities outside London and raise more money towards the costs of running trains.

If it is to be delivered, the project must be delivered using private funds. The public sector should not be expected to foot the bill for HS2 while people are having to make their own financial sacrifices, and there will be no need at all to spend public money once we are out of austerity.

Rising Cost of Transport

Andrew Turner Excerpts

Wednesday 9th January 2013 Commons Chamber

[Mrs Ellman]

At the moment, the overall distribution is about 60% for the passenger and 40% for the taxpayer. In the breakdown of how the funds are allocated on different types of services, however, there are very stark differences. It is in respect of the allocation of the cost and the resultant proportions of contributions made by taxpayers and passengers where further major questions need to be asked. That is why the Select Committee report highlighted the need for more transparency about the cost of different types of services and where the subsidy goes.

The Committee’s main conclusion was that the Government should rule out demand management that would lead to even higher fares at peak times. It made the important point that many people have to travel at peak times in order to get to work.

[Mr Andrew Turner (Isle of Wight) (Con)]

We must all acknowledge that at peak times the demand placed on the rail network can far outstrip supply. How does the hon. Lady think demand can be prevented from exceeding supply? Does she not agree that more should be done to encourage investment in local areas, outside the major cities, in order to remove the need for most of us to commute?

[Mrs Ellman]

People often travel at peak times because those are the times when they have to get to work. They have no choice. However, there are other ways of addressing the question of demand, and I shall say something about them later.

The report also talks of the importance of achieving efficiencies, although we think that the aim of making efficiency savings of £3.5 billion by 2018, as McNulty recommends, is a challenging one. The bringing together of different parts of the rail industry in the Rail Development Group, and through other means, is welcome, but it is important for the industry then to work in the interests of passengers and the taxpayer, not just in its own interests. It is also important for it not to cut corners and put safety at risk in order to achieve efficiencies. We have high safety standards which should not be jeopardised, and strong regulation is particularly important for that reason. The regulator needs to be able to act firmly and decisively.

Members have mentioned other means of achieving efficiencies and reducing fares, or at least reducing the rate of increase in fares. We need to think about smart ticketing and innovation, and about introducing more flexibility in the way in which fares policy is drawn up and implemented, which has been sadly lacking. There should also be more transparency in the use of public funds. It is extremely important for the rail service to receive a public subsidy, because it is a public service, but it is equally important for the £4 billion public subsidy going into the system this year to be dealt with in a way that people understand, so that they can assess whether it is being used effectively. Not all the information that we have at present enables them to do that.

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[Mark Lazarowicz (Edinburgh North and Leith) (Lab/Co-op)]

The starting point for this debate has to be the fact that Great Britain has some of the highest rail fares in Europe. I recognise, of course, that to pay for investment in the rail network the passenger—the fare box—will have to make an important contribution to the funds required. However, the passenger should not be asked to pay an unfair burden, and one way in which we can ensure that passengers are not forced to pay more than they need to is by ensuring that the revenue earned from the network is actually used for the benefit of the network—for the benefit of passengers—and is not siphoned off out of the system.

The evidence from the decades of the privatisation regime, instituted by a previous Conservative Government, is overwhelmingly clear. That approach has meant that billions of pounds has passed out of the system, away from passengers and away from possible benefits of infrastructure investment. Instead, the benefits have been in the form of big profits for many of the companies involved, not just train operating companies but those with ancillary roles in the system, including some of the providers of rolling stock, to mention just one example. This has not just been about money flowing out through large profits; it has also been about operating inefficiencies being brought into the system. Again, those have been to the detriment of passengers and, in their own way, have led to fare increases.

[Mr Andrew Turner]

Can the hon. Gentleman explain why such inefficient companies win these contracts?

[Mark Lazarowicz]

Let us leave aside the fact that there are not many operators in the field to bid. I am not saying that an individual operator is necessarily inefficient, but that the system as a whole leads to inefficiencies as well as to profits being paid out to private companies when they could be invested in the system.

I said that not all companies are inefficient. One example that showed the difficulties and negative effects of privatisation at their highest was the disaster of Railtrack, which was linked not just to private ownership and that company’s motivation in its operations but to the fragmentation of the operators and Railtrack’s distance from the train operating companies. That example also shows how some of the damage caused by privatisation began to be turned around. It is not a perfect organisation, but the publicly owned Network Rail has managed to repair some of the damage caused by fragmentation of the system and we have seen a safer railway network and better value for the taxpayer, for passengers and for other users of the rail network in the costs of maintaining the system.

Rail Investment

Andrew Turner Excerpts

Monday 16th July 2012 Commons Chamber

[Justine Greening]

I assure the hon. Gentleman that we are cracking on with the programme now, and that is precisely why it has been announced today as part of our priority for the next control period. We will work on it with the Welsh Assembly Government, and I am sure that we will be able to release more details to him shortly.

[Mr Andrew Turner (Isle of Wight) (Con)]

Of every 100 people, a mere three travel by train. A huge subsidy is proposed for the £870 million loss that covers CrossCountry Trains and East Midlands Trains, and that does not even cover the infrastructure costs. How are we to justify such massive expenditure that will benefit so few?

[Justine Greening]

Our investment proposal today is about making sure that we have a railway network that can cope with the level of demand in coming years, and that is absolutely critical for our economy, but my hon. Friend is right that we have to ensure that the railways are efficient, and a railway system that every year costs us £3.5 billion more than it needs to is not acceptable. That is why in order to address efficiency we have some difficult challenges ahead of us, but we are going to work with the industry to do that, because the points that he makes are absolutely valid. We have to tackle inefficiency. Well-run organisations provide a better service to their customers, and I am determined to turn the railways into a well-run organisation.

Port of Southampton

Andrew Turner Excerpts

Wednesday 18th January 2012 Westminster Hall

[Mr Andrew Turner (Isle of Wight) (Con)]

Many islanders from my constituency take great pride in being physically separate from the mainland UK, but most recognise the value of its proximity. An acknowledgement of that fact is that so many of my constituents, especially in the north of the island, rely on the mainland for work and it explains why I am taking an interest in the debate.

I offer my support to the right hon. Member for Southampton, Itchen (Mr Denham) to get the Southampton port project moving. As already explained, the aggressive legal action by another port authority has slowed the port expansion proposal to a halt, instead requiring a further review of environmental issues, and that is simply not acceptable. How can a project that requires no public funding, while providing growth, education in the form of apprenticeships, and employment, be held up? That is exactly the sort of behaviour that the Government abhor, yet it is happening.

The sustainable growth of the port of Southampton is incredibly important for the city of Southampton and its hinterland, and the Isle of Wight falls within that remit. Indeed, the success of Southampton is due in no small part to the fact that the island is where it is, protecting the Solent. The island also provides a 360° catchment area, whereas most ports normally have a 180° area because of the very fact of being on the coast. Also, on the island, we rely heavily on the connection to Southampton, which I am told is the third largest port in the country, while East Cowes is the seventh busiest port in the UK. Given the proximity of one port to the other, with the ferry link provided by Red Funnel, East Cowes’s success is very much reliant on that of Southampton.

Tourism is also crucial to the success of the whole region. Hampshire and the Isle of Wight have such a fabulous coastline that it draws huge numbers of people every year. The proposed redevelopment of Mayflower park would play a key role in improving the attraction for tourism. The importance of tourism is reflected by Southampton being the leading destination in the UK for cruise ships, and that business is critical to the local and indeed the wider economy. As the home of famous British shipping companies such as P&O, Cunard and Carnival, Southampton is also part of the heritage of our seafaring nation.

The financial argument for the development proceeding, however, is the most important one. With our country in the doldrums economically for the moment, infrastructure improvements such as the Southampton one have gained increasing importance. What makes it even more surprising that the plan has not moved forward is that no public money is involved in the expansion. The Government have been keen on such infrastructure developments, and we only have to cite High Speed 2 to see that, the difference being that one will cost public money and Southampton port will cost nothing.

What of the island? More than 2,000 people commute from Cowes to Southampton every day of the week, so it is perfectly clear that jobs in Southampton lead to more jobs for islanders. In that respect, as I said at the start, I am fully behind the proposals, and I find it incredible that the process has taken so long to date. Once completed, the development will provide employment to countless families, improve the regional economy, reaffirm Southampton as a world-class port with facilities for the largest ships on the ocean and take the port and city of Southampton further into this century with the capacity that they need. I ask the Government to do everything that they can to ensure that the process is expedited with the appropriate permissions as soon as possible. The delay has been too long.

High Speed 2

Andrew Turner Excerpts

Thursday 13th October 2011 Commons Chamber

[Stuart Andrew]

Absolutely. The benefits for the whole country are evident. The north-south divide is a problem that has faced successive Governments. Clearly, we are not arguing that HS2 will solve that alone—of course, it will not—but greater connectivity between our cities, such as Birmingham, Leeds and Manchester, to the rest of Europe can only help.

I want businesses in my constituency to enjoy having access to markets across Europe and the rest of the world. Transport links are crucial to making that happen. Too often, today’s network cannot cope. I recently went to Airedale International in my constituency. It is a high-tech industry that has just created a training centre. It is begging for high-speed rail, because it has a lot of business down here, but it has the skills up in the north. Why cannot we help it to expand to have both?

We often hear that High Speed 2 is a white elephant, but studies have shown that it will bring about £44 billion of economic benefit and 40,000 jobs, which is not to be sniffed at. I did not see that white elephant when the Thameslink benefit-cost ratio came in at 2.2:1, or when Crossrail came in at 1.92:1.

[Mr Andrew Turner (Isle of Wight) (Con)]

Can my hon. Friend say how much of the money found for the project will be public money, and how much will be private?

[Stuart Andrew]

I would have to get the exact figures from my right hon. Friend the Minister. My point is that what we get back from HS2 will be far greater. If we look at the Jubilee line, the original benefit-cost ratio was 0.95:1. When it opened, that became 1.75:1, which shows that Governments are usually conservative in their estimates of the benefits that we can get from infrastructure. I did not hear about the white elephant when all the infrastructure projects I mentioned—southern infrastructure projects, funnily enough—were suggested.

I understand why Members are supporting and standing up for their constituents—of course they will do that—but they have sent confused messages. They say that they are against HS2 on environmental grounds, yet some of them say, “Build more roads instead.” They say that they are against it on business grounds, yet they never opposed Crossrail or the Jubilee line. They say that they are against it because no one will use it, yet huge investment is needed in Euston station because it will not cope. We need to plan ahead and be bold, or in 10 years’ time Members of Parliament will complain in the Chamber that we did not make the decisions now to bring about the modernisation of Britain’s railways.

Rural Bus Services

Andrew Turner Excerpts

Tuesday 11th October 2011 Westminster Hall

[Mr Andrew Turner (Isle of Wight) (Con)]

I echo what my hon. Friend says. Will he admit, however, that there are problems that the council must tackle? There is the problem of people from off the island getting free transport on the island. People come into the area—I am sure this is true of most areas—for a holiday or for some other reason, but there is no income, or insufficient income, to the bus companies.

[Brandon Lewis]

I thank my hon. Friend, who has first-hand experience of that development. Like him, I represent an area that is heavily used by tourists; in fact, it is the second most popular seaside tourist resort in the country. The system means that areas used by tourists can be further adversely affected. That is partly the result of the complicated arrangement in place for funding bus systems. One of the best things the Government have done—I pay credit to them for what they have done so far—is to simplify the system. Some organisations claim that at one point under the previous Government there were 22 different forms of funding for the bus system. We have got that down to three or four, and it would be a great success if the Government simplified things further over the next couple of years and introduced one funding system that was transparent and understandable to everybody and that sat with one Department.

Another new scheme serves rural Northamptonshire with a fleet of new low-floor minibuses. It allows passengers to book a seat by telephone or text or on the internet so that elderly or frail people can be picked up from home, while others are collected at village bus stops at a set time. That is Northamptonshire county council’s excellent response to the need to save millions by reforming subsidised services. It is much better and more cost-effective, and it reacts much more to the needs of the user than a large, heavily subsidised bus going round villages when it is often empty or close to empty.

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[Brandon Lewis]

I thank the hon. Gentleman for his intervention. We certainly need more flexibility in the system. Whether that is purely in relation to bus operators or we have a system that allows for community transport to be authorised, run and organised by local authorities, we need an approach that is more flexible than simply looking at the traditional system of buses. As my hon. Friend the Member for Broadland (Mr Simpson) has mentioned, buses are not necessarily the most cost-effective solution or, indeed, the best answer for users. We need transport that can be used in rural areas by those with concessionary passes. As I was saying, demand-led services are vital if a rural network of transport is to exist. It is perhaps time to start talking about transport in the rural sense, rather then simply focusing on buses, which might not necessarily give the best service and use.

I am delighted that my county council in Norfolk has agreed to provide additional funding to look at and develop exactly that style of service. At the moment, more than 1,700 community transport organisations operate in England alone and offer transport services for people who are unable to access traditional public transport. It is vital that local authorities and organisations are empowered to provide alternative provision for residents.

An additional £10 million funding for community transport in rural areas is very, very welcome. However, the concessionary fares scheme does not apply to most community transport schemes because they operate under section 19 of the Transport Act 1985. Currently, only registered services run by community transport operators under a section 22 permit are eligible for the scheme. I was disappointed that, when I received a reply from the Minister to a recent written question, it indicated that the Government refuse to consider altering the legislation to widen the eligibility further and that they are leaving the matter at the discretion of local authorities. I ask the Government to look at that issue because dealing with it would be a positive step forward that could further encourage, develop and empower local decisions to be made by local councils and bus and other transport operators based on local need. I agree with the Select Committee on Transport’s recommendation made in August this year:

“If the Government genuinely wants to encourage the growth of the community transport sector, it should legislate to permit the use of the concessionary pass on a wider range of community transport services.”

[Mr Andrew Turner]

Would it not be worth while in some way restricting the viability of the scheme, so that someone could arrive on the Isle of Wight from Northumberland and wave a flag? Some local use of these things is fine, but we do not want a national scheme.

[Brandon Lewis]

My hon. Friend makes a good point in the sense that the national scheme as it has been structured is effectively a bear trap left for this Government by the previous Government. Such a scheme is difficult to sustain and the issues surrounding it have opened up this debate, so that it has become a discussion about how concessionary passes operate. If we accept that a large contributory factor to the rural bus funding crisis is the increased cost of providing a concessionary fare scheme, we have to consider how that can be reformed.

It is absolutely right—I fully support this—that the coalition agreement insists that the Government will continue to keep the scheme. However, we need to find a way to fund it realistically for the long term. That means allowing councils to have enough flexibility to cover administration costs or offer innovative alternatives, some of which I, and colleagues, have touched on this morning.

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[Guy Opperman]

I am grateful for the example. We could all provide examples of our bus companies and the respective counties in charge of bus services not working together. There are good examples: we have a partnership in Northumberland with the Newcastle system, which works very well, but it is an isolated example, sadly. I urge that degree of integration. Surely that is localism in its purest form—the degree to which local organisations talk to each other, rather than existing in a silo, which has been the case for so long.

I finish on the point I made to my hon. Friend the Member for Great Yarmouth. The Local Government Association is in broad terms seeking greater control of bus companies. We have the Government as the ultimate provider, which is passed down to county councils, and the county council then abrogates the responsibility to individual bus companies. The bus company then runs the show. It can stop a service, or do whatever it likes with it. The Government must give guidance to the local authority so that it works with the bus company, and the company does not stop a service just because it does not like it after the contract has been awarded.

[Mr Andrew Turner]

Will my hon. Friend consider a problem that applies to the Isle of Wight? I do not accuse Northumberlanders of this, but in some areas—mine is one—there is a bus monopoly. In my constituency there is a complete monopoly, and one bus company covers the whole island. There is no entry, and that should be considered.

[Guy Opperman]

I now give way again.

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[John Woodcock (Barrow and Furness) (Lab/Co-op)]

I congratulate the hon. Member for Great Yarmouth (Brandon Lewis) on securing the debate. It has been worth while, but we will see how worth while when we hear the Minister’s answers. I will speak briefly to give him as much time as possible to expand on the points that have been raised, particularly the free bus pass, which I shall say more about in a moment.

[Mr Lee Scott in the Chair]

It was a pleasure to see you in the Chair, Mr Caton, and it is now a pleasure to see you in the Chair, Mr Scott. There has been a lightening transformation.

Barrow and Furness is a semi-rural constituency in Cumbria and it has been hit incredibly hard, as have many other rural areas. In my patch so far, we have campaigned for a temporary and partial reprieve for some services, but a great question mark hangs over them, as is the case in many of the areas that have been referred to. I grew up in the red republic of south Yorkshire, as it was then, when my right hon. Friend the Member for Sheffield, Brightside and Hillsborough (Mr Blunkett) was the firebrand leader of Sheffield city council, and one could go anywhere in south Yorkshire for 10p, or for 2p for juniors such as I was. Back in those days, we did not anticipate Norfolk county council joining the agitation about buses, but that is a sign of our changed times.

There is great consensus on some of the points raised today, and Government Members might wish to see me as someone who said what he really thought. Government Members are polite people who are looking to their future in Parliament. The triple whammy effect was mentioned, and it is being severely felt. The hon. Member for Great Yarmouth was polite when he explained that when he looked at the settlement for Norfolk he thought it must have been a mistake. I suggest, however, that it was not an unintentional mistake, that there is clear intent by the Government to impose cuts that the Opposition believe go too far too fast, and that real, lasting damage will be caused to communities.

[Mr Andrew Turner]

I understand what the hon. Gentleman says, but he must not conclude from our criticism on one issue that we would criticise on others. I would like to see where he would make cuts in place of those areas in which he wants us to get some balance.

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[Norman Baker]

I am saying what I was told by the Confederation of Passenger Transport. Immediately after the spending review, it indicated that in general terms it felt able to absorb the reduction in BSOG without an effect on services or fares. That is what it said. I am happy to provide the quote if the hon. Gentleman wants to see it.

It should also be recognised that, even in places such as Norfolk, about two thirds of journeys are on commercial services and are therefore unaffected by what local authorities decide in relation to their own budgets.

Let me turn now to concessionary travel and say first very plainly that, even in these times of austerity measures, the coalition Government are firmly committed to protecting the concessionary bus travel scheme. That was made clear in the coalition agreement, and the Chancellor of the Exchequer reconfirmed that commitment in the spending review. The scheme is of huge benefit to about 11.5 million people, allowing free off-peak travel anywhere in England. That generous concession provides older and disabled people with greater freedom, independence and a lifeline to their community. It enables access to facilities both within and outside their local area and helps them to keep in touch with family and friends. Travel to visit popular tourist destinations can also bring benefits to the wider economy.

The Government are aware of how precious the benefit is to older and disabled people, which is why we are focusing our efforts on assisting local authorities to find efficiencies through reforms to administrative arrangements for the scheme, rather than cutting back on the entitlement. For the avoidance of doubt, the free bus pass is here to stay.

[Mr Andrew Turner]

My hon. Friend is quite correct in what he quotes. I fell into the bear trap that the Labour party left for me, and so did my right hon. Friend the Prime Minister, as far as I can see.

[John Woodcock]

We gave these people free bus travel.

[Mr Turner]

I was wrong to support the scheme, but I supported it and I will support it for the rest of this Parliament. What happens then is a matter that we will have to debate and develop.

[Norman Baker]

I can say to my hon. Friend to be helpful that a number of well-meaning people who are very committed to bus services have raised similar points to the one that he has raised. Those points have been noted and passed both to the Department for Transport and elsewhere in Government. However, we are clear about the commitment that we have made to the free bus pass, and that is not going to change.

I should at this stage pick up a point made by the hon. Member for Great Yarmouth about trying to save money on administration in relation to the bus pass. That is right. We need to consider those types of saving. That is one reason why we were supportive of the idea of moving the administration from districts to counties, which saves considerable costs in the administration of the bus pass.

Only one small change has been made to the entitlement to concessionary fares: the age of eligibility has been increased in line with the changes taking place to the state pension age. That is right, as people are living longer, staying healthy longer and tending to stay in work until later in life. That change started in April 2010, just before the last general election, so local authorities are already making savings as a result. The change will assist with the financial sustainability of the scheme, while reserving the benefits of the bus pass for those with the greater need.

What has not changed at all—this is an important point—is that operators should be reimbursed for concessionary bus travel only on a no better, no worse-off basis. That is in primary legislation introduced by the previous Government. Nothing that this Government have done has changed that at all. Almost a year ago, the Department for Transport published revised guidance to local authorities to support them in determining their arrangements with bus companies, to make sure that they are no better and no worse off. I made that clear in my recent letter to the hon. Member for North West Norfolk (Mr Bellingham) and my hon. Friend the Member for North Norfolk (Norman Lamb), both of whom came to see me to talk about bus services in the county.

In a report published in May, the Competition Commission strongly commended the guidance issued by my Department, since it helps local authorities to take account of the impacts that the concessionary travel scheme can have on commercial pricing policies. The commission says that it hopes that the guidance will be followed to the greatest extent possible. In fact, the majority of local authorities are now using the guidance and should be reaping the financial benefits of taking it on board. I stress, however, that it is entirely a matter for them whether they use the guidance or not. There is no compulsion to do so. The only compulsion is the one that existed in legislation introduced by the previous Government to ensure that bus companies are no better and no worse off from operating the concessionary fares scheme. The guidance can be a useful starting point for negotiation between bus operators and local authorities and, so far this year, more than half of the appeals lodged by operators have been withdrawn—a significant improvement on previous years.

I remind Members that our funding for bus travel does not stop at concessionary travel reimbursement and bus operator subsidy. We have also provided almost £47 million to local transport authorities and bus operators to purchase 542 low-carbon buses across England, through our green bus fund. I would also like to refer to our new £560 million local sustainable transport fund, which this Government have introduced. There have been 39 successful bids in tranche 1, 25 of which have included bus-based elements to help bus travel locally.

Turning to the third element, I recognise that the recent local authority settlement has been challenging. There is no doubt about that. I have heard the argument that the distribution method used at the time does not reflect the particular circumstances facing each local council. That has been brought into sharp relief now that, since April, all funding for the statutory concessionary travel scheme has been provided as part of the settlement from the Department for Communities and Local Government. I should point out, however, that last summer’s consultation by that Department provided an opportunity to influence the final distribution method for the first two years of the spending review period. The overall funding then set was deemed by DCLG to be sufficient to enable local authorities to deliver effective local services, while ensuring that authorities do not set excessive council tax increases. Councils now have another opportunity to make their voices heard. DCLG is consulting on the broad options for a new way of funding local government, based on business rates retention.

The Government are clear that any changes must protect the interests of local taxpayers and the vulnerable, be fair for all councils and encourage growth. Councils that are more deprived—I accept the point that has been made about the definition of deprivation—will continue to receive central Government support. We recognise, however, that it may be possible to improve the way local council spending on concessionary travel reimbursement is treated in allocating local government resources. That is why, following my meeting in April with the hon. Member for Great Yarmouth, my hon. Friend the Member for North Norfolk, the hon. Member for Broadland (Mr Simpson), my hon. Friend the Member for Norwich South (Simon Wright), and the hon. Members for South West Norfolk (Elizabeth Truss) and for Mid Norfolk (George Freeman), I wrote to the Minister for Housing and Local Government on 20 July about the way formula grant is calculated, the relative needs formula for concessionary travel, the so-called floor-damping mechanism, and the local government resource review. That is why the consultation considers whether to review the relative needs formulae for concessionary travel when establishing the baseline for local government funding from 2013-14 onwards.

Bus Industry

Andrew Turner Excerpts

Tuesday 6th September 2011 Westminster Hall

[Graham Stringer]

The hon. Gentleman makes a perfectly sound point, which I will come to in my conclusions. The large operators own the garages and can afford to subsidise competition if there are new entrants to the market—it is a long way from being perfect competition.

I was talking about the profits of Go-Ahead but the profits of Stagecoach are truly staggering, especially when the economy is flatlining and we have been in recession. They are up to £153 million from £126 million, which is an increase from 14.4% to 17.1%. In the friendly debates I have with Brian Souter of Stagecoach, he once called Gwyneth Dunwoody and me “dinosaurs” because we believe in going back to a sane system of regulated buses—he even set up little models of dinosaurs. I do not know how many people in the Chamber remember the film made of the James Clavell book, “King Rat”. When the Japanese prisoner-of-war camp in Singapore was liberated by allied forces, there was one very fat prisoner among all the other prisoners, whose ribs were showing—they were starving to death. At a time of austerity and the economy not doing well, Brian Souter and Stagecoach are the King Rats of the British economy, doing enormously well out of public subsidy when everyone else is struggling to get to work and make a living. They are, in effect, subsidy junkies.

The figures in the Transport Committee’s report show that the bus industry outside London receives from the fare pot about £1.8 billion in a total income of £3.4 billion, so 47% of the bus industry’s income comes from taxpayers. It is as simple as that. Whenever a bus leaves a depot, an average of 50% of its costs are paid by taxpayers. Given what has happened with deregulation, is that sensible use of taxpayers’ money? Are we receiving the best possible value?

[Mr Andrew Turner (Isle of Wight) (Con)]

The hon. Gentleman may not know that in my constituency there is only one bus company for the whole island, and there is no competition. What prevents large companies from competing in the parts of Manchester that he mentioned, where that seems not to happen?

[Graham Stringer]

I am the wrong person to ask, but my view is that companies do not compete because then they can exploit the market using informal agreements or in nods and winks, by putting up fares in their own areas without the cost of competing. The statistical evidence in their profits and fare levels is that they are exploiting the market compared with what happens in the London market. That is voluntary. Companies are happier operating in their own areas. They say that they do not like the extra dead mileage if buses must be driven into areas where other companies operate from their depots, but that is a weak argument. They simply do not want to compete because it is more profitable for them not to.

The making of high profits was the first major finding in the Competition Commission’s interim report. The second was that many operators face little or no competition. It is welcome that the commission finally got around to writing the report, but it is flawed in many ways, as such reports tend to be because they look at statistics over the past five years, but the economic world is now different and more difficult. They estimate that anti-competitive behaviour costs £70 million, but they do not include the cost when people abandon buses; if that were included the real cost to the public would be much higher. In addition, they do not look at how the current bus system inhibits the use of simple integrated ticketing, which would drive up the number of passengers using buses.

I have a few requests for the Minister. First, when the Competition Commission’s report is published and he is considering what to do about buses, will he bear in mind that there is a lot of information out there, but it has to be culled at great expense from surveys and other sources, because the bus companies keep much of their information private, despite receiving 50% subsidy? Good-quality information is vital for local transport authorities when planning their services.

My second request is for through-ticketing. We know what brings people back on to buses: a simple, low-fare structure with through-ticketing. It is estimated that if fares are cut by 20%, passenger numbers increase by 13%, with a further increase if the ticket structure is simplified with through-ticketing. What can the Minister do to help that?

My main question, which goes back to the beginning of my speech, is how can the Minister support and help to build on the powers and structures in the 2008 Act? I know that he understands the legislation thoroughly, because he and I served on the scrutiny Committee. There are many barriers facing South Yorkshire, West Yorkshire, and Tyne and Wear passenger transport authorities. They are considering moving back to a regulated system of quality contracts, because the buses, bus drivers and depots are in the hands of the bus companies, which have rubbished the Competition Commission’s interim report—well, they would—and are threatening a scorched earth policy for any passenger transport executive or authority that decides on re-regulation. What help can the Minister give those transport authorities?

Everyone knows that we are dealing with a coalition Government. The Minister’s views are well known from the time before he was a Minister, as are the Secretary of State’s. The Secretary of State is more of a free marketeer, and the Minister believes in the instruments in the 2008 Act, but when the bus industry is declining, the balance between the two parts of the coalition, resulting in a watching brief and agnosticism on the industry’s future, is not satisfactory. I should be grateful if the Minister told us his view.

My final point is that the present Government and Governments for the past 25 years have not done enough for the quarter to one third of people who do not have access to a car and rely completely on buses. One of the most appalling sarcastic comments made by the last Prime Minister, in response to a Birmingham Member who asked what he would do about the loss of a bus service in Birmingham, was that he would immediately call a Cabinet meeting. He said that sarcastically, but Cabinet Ministers should discuss bus services. They are vital for many millions of people in this country and they have been neglected or given too low a priority for long enough. I look forward to the Minister’s support in protecting and helping the bus industry at a time of inevitable cuts. That is possible.

--- Later in debate ---

[Mr Wright]

My hon. Friend makes an important point, and my hon. Friend the Member for Blackley and Broughton referred to the same issue. Economic activity is very much contingent on the availability of good transport and connectivity. Concerns have been raised with me both by constituents living in the urban part of Hartlepool and by constituents living in outlying areas, who say that they cannot take up a job because they cannot get to the place of work as a result of the absence or removal of the bus service.

Another of my constituents cited in the Select Committee report is Mrs Powers, who states:

“Since the removal of the bus service my daughter…has NO way of getting to and from college…Is she surely not entitled to the education she deserves? My daughter works very hard and gets excellent grades and I feel appalled that her future education is being jeopardised in this way!”

It is important to mention the importance of access to education in rural areas. My hon. Friend the Member for Clwyd South (Susan Elan Jones) will be concerned about that as well.

It is clear that competition in the bus market in Hartlepool has failed. Deregulation since the mid-1980s has not proved to be a success. The market is characterised by too dominant a player, making excessive profits by cherry-picking the busy and popular routes and ensuring that passenger choice is left behind. For those services that remain, punctuality rates are behind what should be expected, because operators do not fear that another company might come along and provide a better service that takes away their market share.

[Mr Andrew Turner]

It is not the case that things have been tested and found to fail—they have not been tested. We have to try the competition route, which should be given the chance to work under the new system. We have to make it work, rather than pretending that it has already happened and been found to fail.

--- Later in debate ---

[Andrew Gwynne]

With many bus services used disproportionately by people on lower incomes and by those without access to a car, the socially excluded are worst hit by service reductions. For example, two out of every five jobseekers say the lack of transport is a barrier to getting a job.

When considering bus services, we really must take account of the policies being implemented by the current Government. Many of the cuts are happening not by chance, but by choice. The Government have made a number of critical decisions that I do not just fear but know will have a real effect on bus services. First, as my hon. Friend the Member for Blackley and Broughton said, there is the 28% cut to local authority funding for local transport, which includes money for subsidising unprofitable bus routes. Support will be reduced by £95 million between 2010-11 and 2011-12.

Secondly, the Government are changing the way councils and bus operators are reimbursed for the concessionary fares scheme for older people, taking £223 million from the scheme between 2010-11 and 2011-12. Thirdly, from January 2012, they are reducing by a fifth the rebate for additional fuel costs for running unprofitable bus services, and that will particularly affect rural areas, as my hon. Friend said. That will take away a further £254 million in support for bus services between 2010-11 and 2011-12.

We are already seeing that these changes mean the end of council-funded rural, evening and weekend buses in many parts of the country. With rising costs, the need to maintain profit margins and the state of local budgets contributing to fare rises, the changes will largely mean service reductions in some of the most isolated parts of the country.

When the Prime Minister made his election pledge to protect free bus travel for pensioners, or at least to protect their passes, he did not tell them that, in doing so, he would take away their bus services instead. The sad fact is that the situation on bus cuts is likely to get worse. Forecasts by PTEG show that, by 2014, fares will have increased by a further 24% in real terms in metropolitan areas, while service levels will decline by 19% and patronage will decline by 20%.

[Mr Andrew Turner]

It is interesting to look at what the Prime Minister said before the election. In my constituency, at least some pensioners would rather pay half fares than face the possibility of having no buses at all. They would like to pay their bit on the buses.

[Andrew Gwynne]

Indeed. In places such as Greater Manchester, there was a long-standing concessionary fares scheme before the national bus pass scheme was introduced, and pensioners paid a small amount. Under the bus pass scheme, the concessionary fare was available on peak services until it was removed this year—in the peak period, pensioners now have to pay the full fare. My constituents make the same point as the hon. Gentleman’s and would sooner pay something than lose their service altogether. It is clear that all parties at the last general election pledged to protect the bus pass, but there is no point people having that bit of plastic if they do not have the buses to use it on.

The situation is already bad, but it will undoubtedly become increasingly difficult to maintain current service levels when spending reductions deepen in successive years. In non-metropolitan areas outside London, there have been significant cuts to supported bus services, with some local transport authorities withdrawing funding from all such services, and we have heard first hand about the appalling situation in Hartlepool.

Let me turn briefly to the level of competition between the bus companies. As we know, the Competition Commission is investigating the local bus market and published its provisional findings in May this year. Its provisional findings included the view that profits are higher than they would be if the market were competitive and that too many operators face little or no competition in their areas. The competition authorities recently looked at tactic co-ordination between bus companies, and that has certainly raised a few questions about how truly competitive the bus industry is. The interim report also found that short-term bus wars on the streets, such as we experienced a few years back in Manchester, when the big bus companies used an extremely aggressive approach to drive out the smaller competition and secure their monopolies, were not the way forward, and that more should be done to facilitate multi-operator ticketing. Although we await the full report later this year, the interim report makes interesting reading and helps to inform our debate today.

Of course it was the previous Labour Government who set the ground for improvements to be made to local bus services. We set in progress ways of tackling some of the worst effects of deregulation. Indeed, quality contracts—or the provision for them—were introduced by the previous Government as a key to improvements in bus standards. In hindsight I think that our party would like to have gone further with those improvements to service provision for passengers, and with the implementation of quality contracts. Certainly, those contracts could allow bus companies to concentrate on developing the local market for bus travel, but it is understandable, given the points that have been raised by my hon. Friend the Member for Blackley and Broughton, and given the burden of risk on local authorities as opposed to the bus companies, that those measures have not been pursued as vigorously as they should have been. Quality contracts would help to set minimum standards, making it possible for them to be more stable, with less frequent changes to fares, times and frequencies. In turn that would help bus services to be more reliable, because they would be monitored and good performance would be incentivised.

It is fair to say that the current set-up does not always benefit the passenger, and we need to consider other ways of making our local buses work more effectively. We need to think about ways of addressing the issues that have been raised today, and ways of empowering local authorities and communities, allowing them more of a say in the way their bus services are run, and what the routes should be. Perhaps we need to look at ways to make it easier for passenger transport executives and local transport authorities to enter into voluntary partnerships, statutory quality partnerships and a more balanced quality contract system. That could allow for a system of franchising bus services to local transport authority specifications, similar to the system used to provide bus services in London, allowing a service that is responsive to what passengers want and reintroducing some long-term planning to the system.

I want to ask the Minister what consideration the Government have given to allowing local authorities more powers over local bus services. What assessment has the Minister made with regard to quality contracts? Does he view them as a way to set minimum standards and to make service levels more stable and reliable? What assessment has he made of the greater powers that Transport for London has over local buses and the performance in relation to bus services in London, as compared with what happens outside London, particularly in major conurbations, although the problem is not exclusive to big cities, but also exists in large and medium-sized towns and rural areas?

There is clearly a wider debate to be had about the way we look at restructuring our bus industry. Deregulation has largely failed, and that has been recognised in the debate. We need to think about restructuring our bus industry. I am sure that the discussion we have had today will help to inform the ongoing debate.

--- Later in debate ---

[Norman Baker]

I am grateful to the hon. Gentleman for that clarification; he wants the money to be ring-fenced for bus services.

My right hon. Friend the Secretary of State has asked me to initiate a review of BSOG to see whether it is deployed to the best advantage. As far as possible, our time scale is designed to coincide with the Competition Commission report, so that if changes are necessary to the landscape of the industry or to that form of financial help, things could be combined at that stage. To that end, I have been in discussion with the industry and local authorities to hear their aspirations and views on the matter. I shall try to come up with a solution that is satisfactory for both parties—I shall then go on to deal with the Israel-Palestine problem. I hope that we might make some progress. It is in the interests of local authorities and bus operators to come to a sensible arrangement on BSOG.

We understand that good bus services can contribute to both of the Government’s key transport priorities—creating growth and cutting carbon emissions. By providing an attractive alternative to the car, not only can we cut carbon but we can unclog the congestion that chokes off our local economies. However, it must be remembered that we also have to deal with the budget deficit.

I do not want this to be a sterile debate—a phrase used by the hon. Member for Blackley and Broughton—about why we are where we are, but I have to respond to the comments of the hon. Member for Denton and Reddish, the Opposition spokesman. It would have been helpful if he and his colleagues had acknowledged some responsibility for the financial situation in which we find ourselves, rather than pretending that the cuts are somehow malicious and optional, and could have been avoided. That is not the case. I would like to think that we could work across the House to ensure that the impact on bus services is minimised in the constructive way suggested by the hon. Member for Blackley and Broughton.

I shall deal briefly with the three elements of funding referred to earlier. About 80% of bus services are run commercially. I will leave aside questions about the consequences of that for the market and for local government support. The money from the Department for Communities and Local Government is not relevant to those services. At present, local authorities rely on BSOG. The reduction in that grant was trailed long in advance, at the time of the spending review, and it will not take effect until April next year. There has been an 18-month lead in, and the cut was much less than the bus industry anticipated—and much less than Members of Parliament expected. At the time, the Confederation of Passenger Transport, which represents the bus industry, indicated that the cut was manageable and could be introduced without a diminution of services or general fare increases. That is what it said. It is important to point out that bus companies can take the BSOG arrangements in their stride. That should not, therefore, lead to cuts in services.

The basis of the reimbursement arrangements has not changed one iota. The hon. Gentleman will know that primary legislation stipulates that bus companies should be no better and no worse off from handling concessionary travel. That legislative requirement has not changed, and local authorities are required to reimburse bus companies accordingly. All that has happened is that the Department for Transport has issued some guidance to help local authorities to calculate how they should reimburse bus companies, and that, as Members will appreciate, is quite a complicated business. The ultimate test remains the same. If bus companies are unhappy with the reimbursement they have received from a local authority, it is open to them to appeal and their case will be handled independently.

One of the changes that I have made is to ensure that, if there is an appeal, it is possible for a local authority to win. Hitherto, when bus companies have appealed, their contribution has either been reduced or it has stayed the same. Now the appeal process can assess whether local authorities have had to pay too much and reduce the costs to them. That seems to be a much fairer way of dealing with those matters. The appeal process is open, fair and independent and can deal with any complaints that people have.

As for cuts in funding to local authorities, we all accept that local authorities have a challenging settlement. That is particularly the case, may I say for the benefit of the Member who has disappeared, for rural areas and for those services that are supported by local authority funding because they are not commercial to run. Having said that, the pattern of responses from local authorities across the country is varied. Unfortunately, some councils have taken something of an axe to local services, while others have made very few cuts. That is a matter for localism. It is up to local councils to exercise their increased freedom and to decide how they are going to spend their pot of money. We will increasingly see a situation in which one person living in an area will say, “Why is it that my county council has cut these bus services when the county council next door has not cut bus services at all?” That is a perfectly proper question to ask and one that we are trying to encourage in our drive towards localism.

[Mr Andrew Turner]

Will the Minister consider the wish of some elderly people, in areas where buses have been withdrawn altogether, to make a contribution? At present, the system is no buses, no pay.

[Norman Baker]

I well understand why my hon. Friend made that point, which has been made by a number of others. All I can say is that the Prime Minister has made it clear that the concessionary fares regime for local bus travel is not to be compromised and that requiring a charge would do just that. All I can undertake to do is to ensure that my hon. Friend’s comments are passed up the chain so that others are aware of that view.

The hon. Member for Blackley and Broughton mentioned the monitoring of cuts. Let me assure him that we are taking steps to establish the picture. I have asked my officials to do so on a rolling basis. We are checking where services are being significantly cut and where they are being protected. Ultimately, it is a matter for localism, but we have to understand what is happening.

The hon. Gentleman failed to mention the introduction of a £560 million grant, a significant amount, from the local sustainable transport fund, which can be used to drive up the number of bus services in a particular area as part of an integrated package to create growth and cut carbon. That has been well received. If we take the total package of measures under the loose heading of sustainable travel, the £560 million represents an increase in funding compared with what was available under the previous Government. Therefore, despite the difficult economic circumstances and the budget cuts that have taken place, we have made an increase in funding, which has been well received by councils. Every council that could qualify under that scheme, with the exception of the Isles of Scilly, has applied for funding. We had a good first round. I am happy to say that, in Manchester, the key component bid was approved, which is a cycling project for the city. Moreover, a large project from Manchester has applied for a significant amount of money and it has been shortlisted for the final approval process. Therefore, steps are being taken to address the issue of sustainable transport more widely as well.

Oral Answers to Questions

Andrew Turner Excerpts

Thursday 10th March 2011 Commons Chamber

[Mr Andrew Turner (Isle of Wight) (Con)]

8. When she expects to publish plans to allow civil partnerships on religious premises.

[The Secretary of State for the Home Department (Mrs Theresa May)]

On 17 February, we announced our intention to implement section 202 of the Equality Act 2010, which removes the ban in England and Wales on civil partnership registrations being held on religious premises. It is a permissive provision, which means that religious organisations that do not wish to host civil partnership registrations will not be required to do so. This is a positive step for lesbian, gay and bisexual rights and for religious freedom, and I hope Members on both sides of the House will welcome it.

[Mr Turner]

Will the Secretary of State confirm that there is no prospect whatever of the voluntary nature of these civil partnership registrations being turned, by the intervention of the courts, into a right, whereby the long-standing opposition from most churches, mosques and synagogues will be overridden?

[Mrs May]

I would make two points in response to my hon. Friend’s question. First, this provision was introduced as an amendment to the Equality Bill because religious organisations asked to be able to hold civil partnership ceremonies on their religious premises. It was introduced before the election and was widely supported, and we have decided to go ahead with it. To reassure my hon. Friend, however, I point out that section 202 says:

“For the avoidance of doubt, nothing in this Act places an obligation on religious organisations to host civil partnerships if they do not wish to do so.”

That is the legal background against which the provision will be introduced.