Railways Bill

Baroness Alexander of Cleveden Excerpts

2nd reading
Tuesday 7th July 2026 Lords Chamber

[Baroness Alexander of Cleveden (Lab)]

My Lords, like the noble Baroness, Lady Grey-Thompson, I am going to start with a personal anecdote, but it will not be either as moving or as consequential as the ones we have heard from her today. I pay tribute to her campaigning work on this issue; I am sure that sentiment is shared by other Members of the House.

On a Friday, when I get to Euston and am heading north, I yearn for the toilets to work, effective wifi and a quiet coach. By the time I get back to London on a Monday, as a commuter, I am looking at “Am I going to get a seat? Is it reliable? Is the price fair?” Of course, a top-class railway that is spending £22 billion annually—with more than half of that taxpayer subsidy—arguably can and should provide all these things and more, and I have not even mentioned the other neglected priorities of electrification, extreme weather resilience, modal shift, new services, safety, speed, fresh sandwiches and so on.

All these competing ambitions make a wider point in that they concern the choice of priorities, yet the essence of the claim in the Bill is that the delivery of future policy priorities can follow only from getting the basic underlying structure right. The Bill is a fresh start. It legislates for an outcome that the Conservatives recognised the case for but did not act on: the need to end the fragmentation and to bring track and train together. The noble Baroness, Lady May, graciously hinted at the value of bringing track and train together. I share her concern for passenger voice as a live issue and regional influence, but I am mindful that I am to be followed by the noble Lord, Lord Redwood, who I anticipate having a slightly more ideological engagement about the merits of privatisation versus nationalisation; I promise to say a word on that later.

I think that the public’s first concern is simply a service that works. The Bill builds around an evidence case that fragmentation is holding our railways back. The Minister noted that we have 17 different bodies, so unifying track and train under a single organisation is designed to work for passengers, freight and the taxpayers. For the first time in a generation, we will have a single arm’s-length body that is unambiguously accountable for making the railways work. Of course, a new structure could potentially drive out the very large existing inefficiencies, and it is the prerequisite for dealing with the prevailing culture, which is one of blame, then negotiation and then compensation.

Despite those vital changes, the trade-offs between affordability and reliability, and between subsidy reduction and network upgrades, will remain, so I welcome that, when it comes to setting priorities, the Government have given us a flavour. They are about to publish a long-term rail strategy that will have five core objectives, two of which will deal with long-term economic growth and reducing regional inequality.

We need to reorientate our railways to our long-term ambitions for the nation. Two hundred years ago, railways were the new general-purpose technology of their day. Today’s general-purpose technology is AI, and quantum will follow. Again, we face as a country the creative destruction that is changing our economic geography in the same way as railways first shaped our economy, our geography, our leisure and our landscape.

Great British Railways should be tasked with supporting a faster-growing economy. This is a time of profound change. We need it to break down barriers of opportunity, reduce journey times, improve connectivity and stimulate regeneration and housebuilding next to stations.

Let me come beyond the rhetoric, to the relief of the other side, to the challenges that come with establishing a single organisation. Great British Railways, when it is fully established, will employ 100,000 people. It will be the country’s largest arm’s-length body. The stakes are high. On the plus side, public ownership avoids the siphoning off if dividends and profiteering. However, we must also mitigate the known risks. Monolithic organisations can be deaf to key interests, captured by other interests, slow to innovate and risk averse. These are not insuperable challenges. Many nations manage to have fast, reliable, successful railway systems, and so should the nation where it all began. The structural changes will need to be coupled with political and organisational leadership. To meet public expectations, we will need better regulation rather than more regulation. To encourage the self-sufficiency of the system and manage the burden on the taxpayer, the House of Commons Transport Select Committee suggested that we should be setting a passenger growth target to incentivise commercially minded improvements.

When it comes to nurturing innovation, the Minister will be aware of the ongoing anxieties, notably from the open access operators. They account for only 1% of services but they are responsible for 19% of the new train orders in recent years, so we need to make sure that they find their place. They have been successful in securing modal shift on the Edinburgh to London route and elsewhere.

In my few remaining minutes I come to the issue of devolution of decision-making, clear accountability and speed of decision-making. This touches on some of the anxieties that the noble Baroness, Lady May, raised about regional input. Britain’s devolution landscape is complex, highly varied and very fast evolving. Others have referenced the new Member for Makerfield. I welcome that the Bill provides for the devolved Governments in Wales and Scotland and the combined mayoral authorities to have a statutory role in the rail network, but I would welcome reassurance on how this will work in practice. Can we expect to see any of the mechanisms for clear accountability, locally and nationally, during Committee? As a signal of intent of their commitment to working with the devolved Governments and mayoral authorities, will the Government look at developing shared evidence bases that will allow for the stronger business cases that will allow us to move over time to local commissioning? Finally, on ticketing, I will say only that it must be right to consolidate 55 million different ticket types that are allegedly available and make it easier for the passenger to find the most affordable fare.

In conclusion, I say that this Bill is a bold statement. That is important. It is not always that Members on this side can stand and say, “This is a bold statement about the way forward”. We as a Government have been accused of timidity. This is a bold statement to fix a problem that has frustrated passengers, railway staff and the railway industry for too long. It begins a process of evolution from today’s semi-privatised rail network to a nationalised railway, but the essence is to bring track and train together and end 30 years of experimentation, unlocking growth and delivering efficiency in the network. I commend the Bill and look forward to Committee.

Railways Bill

Baroness Alexander of Cleveden Excerpts

Committee stage
Tuesday 8th September 2026 Grand Committee

[Lord Young of Cookham (Con)]

My Lords, I have added my name to five amendments in this group. I am the lead name on Amendment 31, which would require the Secretary of State to issue directions to promote fair competition, and on Amendment 48, to which my noble friend referred. It has the same objective as the other amendments, particularly those ably moved by my noble friend, but it does so by making it a condition of GBR’s licence that GBR does not distort the market in ticket sales. The advantage of that amendment is that it is upstream—it is proactive—in that GBR would not get its licence until it had satisfied not just Amendment 48 but, in conjunction with Amendment 47, the CMA had signed off the necessary precautions and provisions that my noble friend has just referred to to make sure that any competition is fair. The other amendments would place a duty on GBR to compete fairly, but they would bite only if it was alleged that it was not doing that. The advantage of Amendment 48, in conjunction with Amendments 47 and 49, is that it is upstream and hopes to avoid the problem.

I am grateful to the Minister for the meeting he held on 3 September when he confirmed that he wanted a fair and open market when it came to retailing. There was some good news at that meeting in that the Minister confirmed that GBR will not be selling tickets that only GBR can sell—a practice to which my noble friend referred. He confirmed that anything that GBR sells will be available to online retailers, and it would be helpful if we could have that on the record. The ORR has already done a review of the benefits of an active retail market, and this is what it said in 2015:

“Third party retailers play a key role in improving ticketing for passengers. They offer different ways to access information about rail fares and journeys and provide more choice in where and how to buy tickets. They also play a role in expanding the rail market (to the benefit of TOCs and taxpayers) and in putting competitive pressure on TOCs to improve their offering, including by innovating”.


A recent review by a firm called Teneo estimated that third-party retailers added an extra £450 million per year in additional revenue for the rail industry by attracting new customers, reducing friction in the rail journey and supporting revenue protection. The independent sector pioneered digital ticketing. It paid 70% of the £30 million upgrade to the new barcode infrastructure. Those benefits can carry through to GBR, but only if there is fair and open competition.

The independent retailers are used to competing with train operating companies. At the moment, they are prevented from unconstrained subsidy of their retailing by the public service obligations in transport. They are happy to continue to compete with GBR, but they are anxious that there should be a level playing field, as my noble friend has just explained. She quoted from the CMA; the following sentence adds force to her argument. About the risks, it said:

“In a more closely integrated model, additional safeguards are likely to be required in order to achieve the government’s aim to ensure the sector benefits from the effects of fair and open competition between GBR and TPRs”.


Those additional safeguards are the subject of all these amendments.

One possible solution would have been to adopt the model of SNCF, a publicly owned French railway company whose website is a separately owned company. However, the Minister has made it absolutely clear that he does not want that option; he wants an integrated GBR, so I will not pursue it in that particular form. But insisting on an integrated model does not mean that the cost of online retailing should not be identified—a point made by my noble friend. Separate and transparent financial accounting should be a cornerstone of the safeguards that the CMA and ORR want. My noble friend referred to British Telecom; there is a parallel here. Both GBR and British Telecom owned the network but sold services using that network in competition with others. As my noble friend said, the solution insisted on by the regulators was clear separation.

May I draw on my experience as a former Treasury Minister and Transport Secretary to outline the risks that I see ahead? In the next few years, there will be enormous pressure on the Department for Transport. It is an unprotected department, and the IFS has estimated that it will have to cut its budget by 3 percentage points between now and 2029. It will get a letter from the Treasury asking it to identify savings of between 5% and 10%, in cash terms, in order to keep the Government within their fiscal target. The Secretary of State will reply by thanking the Treasury in courteous terms and saying that it can meet that target only by either cutting investment, cutting the rolling stock programme, which impacts on growth, putting up ticket prices, which impacts on the CPI, or cutting branch lines that run through a whole lot of ministerial constituencies.

The Treasury will then go through the department’s budget line by line and suggest savings. It will ask why so much has been spent on first-class travel and why it has so many press officers. In relation to this debate, it will say to the GBR, “Why are you paying £200 million in commission to independent retailers when GBR has its own website?” It will suggest to the Department for Transport that it cuts the commission from 4.5% to 2%. It will say that, historically, it was 10%, but it was cut, and it was cut again by the RDG to 4.5% in 2021, I think. The Treasury will argue that the pain should be shared not just by the Department for Transport but by independent retailers, and that with AI and by seeking new markets and doing more advertising, it can reduce its costs. The online retailers will say, “This totally destroys our business model. There is no way we can survive on 2%. It will drive us out of business”. There will then be no pressure to innovate and no consumer choice, and we will be left with a GBR monopoly with no pressure to innovate or improve passenger standards.

They may actually go further and say that the website that should be taken down is actually GBR’s. They will say that there is no way that GBR could survive on 2% and may well allege that the website costs far too much to set up, that it is overstaffed and that the costs of the premises that the website occupies are not accurately reflected. I do not take sides in that great debate, but the only way that the ORR or CMA will resolve it is with some facts and figures that identify exactly what costs are involved in GBR’s exercise.

The Minister may argue that these amendments are not needed because GBR would already be bound by competition law—and it is—and there is already a statutory obligation to do what I have said, so what we are doing would simply duplicate that obligation. But how would that competition law be enforced if we do not have the data?

He may also argue that GBR is an integral entity quite different from an online retailer, that online retailing is lumped together with the ticket offices and call centres, that it is quite impractical for GBR to identify one means of selling its tickets from the others, and that it makes no sense to regulate online retailing separately from them. The Bill wants to lump it all together so that GBR’s online harm—online arm; I am sorry—can hide inside the wider retail function. That argument sits uneasily with a commitment to fair and open competition. The station ticket offices and call centres do not compete with the online market. The website does; online retailing does. Treating all retailing as one function allows GBR to claim that its online arm is merely part of a broader retail activity, enabling it to argue that competition duties do not apply to its online parts. Crucially, it allows the cross-subsidy from infrastructure budgets to be buried inside retailing and enables GBR to avoid the cost of sale parity by hiding online costs.

I noticed that these amendments are signed not just by Conservatives but by Liberal Democrats and Labour Members. So there is a real imperative on the Minister to indicate some flexibility on this matter, and some willingness to have further discussions and, crucially, to table some of the amendments or variations on them with the assurances that all those who have signed these amendments are after.

[Baroness Alexander of Cleveden (Lab)]

My Lords, I apologise to your Lordships for not being here at the start of proceedings. Noble Lords put me on to the Economic Affairs Committee yesterday; it had its inaugural meeting this afternoon and it demanded my presence. I am so sorry to have missed the first two groupings, but I am here for this one.

I will speak to the two amendments to which I have added my name—Amendment 117, to which the noble Lord, Lord Young, just referred, and Amendment 136, in the name of the noble Baroness, Lady Harding. My reasons for supporting them closely parallel the arguments that we have heard. I do not have the distinguished history of having been a Rail Minister, as the noble Lord, Lord Young, was—at least not in Westminster—but I had that role in the Scottish Parliament and I understand the risks of unprotected departments. Therefore, we have a duty in the Bill to consider how to protect the incredible digital innovation that we have seen in the provision of retailing services that have been widely welcomed by passengers across the country. The noble Baroness, Lady Harding, and I share a common interest in the whole area of digital regulation, as she said. The risk of leaving ambiguity surrounding the role of regulator and not putting obligations in the Bill may lead to unintended consequences down the line.

I thank the Minister and officials for the recent engagement they had with noble Lords around the intent in these areas of rail retailing. I appreciate that the retail code of practice will be published prior to Report; it will go some way to allow all parties to assess whether the code meets the Government’s stated objective of fair competition in retailing.