Railway (Licensing of Railway Undertakings) (Amendment etc.) (EU Exit) Regulations 2019

Baroness Sugg Excerpts

Thursday 21st March 2019 Lords Chamber

Moved by

[Baroness Sugg]

That the draft Regulations laid before the House on 25 February be approved.

Relevant document: 17th Report from the Secondary Legislation Scrutiny Committee (Sub-Committee A).

[The Parliamentary Under-Secretary of State, Department for Transport (Baroness Sugg) (Con)]

My Lords, in moving the regulations I will also speak to the Train Driving Licences and Certificates (Amendment) (EU Exit) Regulations 2019. These regulations are being made under the powers conferred by the European Union (Withdrawal) Act 2018 and will be needed in the event that the UK leaves the EU without a deal. The regulations fix deficiencies in two sets of domestic railway regulations and EU implementing legislation: the Train Driving Licences and Certificates Regulations 2010, the TDL regulations; and the Railway (Licensing of Railway Undertakings) Regulations 2005, the operator regulations.

As part of the measures aimed at liberalising rail markets, the EU introduced standard documentation for train driving licences and rail operator licences. These documents are valid across the European Economic Area. The Office of Rail and Road—the ORR—is responsible for issuing train driving and operator licences in the UK. Subject to meeting certain criteria, such as medical and competence requirements, the ORR will issue a train driving licence valid for up to 10 years. Train drivers also need a certificate, issued by the operator, confirming that the driver is competent to drive a certain type of train on the infrastructure. Operator licences are issued subject to the operator meeting certain conditions, including financial fitness and having necessary insurance cover. In Northern Ireland the Department for Infrastructure is the licensing authority.

The Train Driving Licences and Certificates (Amendment) (EU Exit) Regulations amend the TDL regulations and three pieces of EU implementing legislation. The regulations will ensure that the train driving legislation will continue to function after exit day by making a number of technical changes. They remove reporting requirements to the Commission, references to member states and functions reserved for the EU Commission and the European Union Agency for Railways. The regulations also amend the definition of a “train driving licence” so it refers only to ORR-issued train driving licences. In addition, changes are needed to ensure that licences issued in Northern Ireland are valid for use in Great Britain and to make corrections to the EU implementing legislation that applies to both GB and NI.

The Railway (Licensing of Railway Undertakings) (Amendment etc.) (EU Exit) Regulations make similar technical corrections, removing references to member states and replacing references to EU legislation with references to domestic legislation. The most significant amendment is to rename the “European licence” as a “railway undertaking licence”, though the cost, criteria and processes for obtaining a licence will not change. The draft regulations also revoke implementing regulation 2015/171. This EU regulation sets out a standard template for the form of an operator licence and details on the procedure of applying for a licence. These will not be required post exit as this detail is already incorporated into the ORR’s procedures, which are published on its website in accordance with the operator regulations.

Both sets of regulations also make transitional provisions that recognise existing European documentation, issued in EEA states, for a maximum of two years after exit day or until it expires, whichever is the sooner. In short, existing train drivers and operators providing services in Great Britain will not have to take any immediate action if the UK leaves the EU without a deal, regardless of where their documents were issued. There are a small number of drivers in the EU using ORR-issued licences, which will not be automatically recognised in a no-deal scenario. Departmental officials have worked with the regulator and operators to ensure that these drivers are aware of the need to obtain an EU licence. There are also UK operators providing services in the EU. All these operators already have licences issued in the country they are providing services in, so will be unaffected.

These draft regulations support the smooth continuation of cross-border services, such as Eurostar, by ensuring that EU-licensed train drivers engaged in cross-border services will continue to be able to operate in the UK. The Government are actively engaging with a range of European counterparts, including relevant member states, to secure bilateral agreements for cross-border rail services. These discussions include arrangements for longer-term recognition of train driver licences and operator licences. Bilateral discussions are progressing well, and we are confident of having measures in place in time for exit day.

By removing certain administrative requirements, the draft operator regulations technically widen the scope of who can be charged an application fee by the ORR for an operator licence and of who could be captured by the existing criminal offence of driving or operating on the railway without an appropriate licence. Consequently, these draft regulations are subject to the affirmative procedure. In Northern Ireland, the role of issuing these licences falls to the Department for Infrastructure and a separate instrument is being taken forward on behalf of Northern Ireland.

We have worked closely with the ORR and have engaged with industry to provide as much certainty as possible. The regulations are an important part of our no deal preparations, providing clarity for business and certainty for drivers. I beg to move.

[Lord Berkeley (Lab)]

My Lords, I am grateful to the Minister for bringing these regulations to the attention of the House. We have only got a week to go, and if we do not pass them today there may not be any trains running after 29 March—so well done the Department for Transport for leaving it to the last minute.

I have a couple of questions on both SIs. On the licensing of railway undertakings regulations—this is not clear to me and maybe this is not part of these regulations—I was talking to a train operator, from a UK company which has a licence in this country and also operates railway services in other member states, who explained that the company was having trouble in finding out whether its UK licence, in other words its licence to operate in the UK, would be valid in other member states after Brexit. Such companies try hard, often in competition with other incumbents, and it is a strain on their business and management set-ups if they still do not know whether they will be able to operate, either under a new franchise or in continuation of an existing one, after next week. I note that in paragraph 7.3 of the Explanatory Memorandum, as the Minister said in her introduction, there is a two-year window for these licences to continue. However, I am not sure whether that occurs in the other direction, and I would be grateful if she could respond to that.

I have two issues on the train driving licences and certificates regulations. Will UK drivers operating in France, the Channel Tunnel or other member states need to take driving tests in France and, if so, when? Is there a two-year window or when will it happen? This concerns not only Eurostar because in the future there might be other companies operating services through the tunnel, as well as rail freight. I declare an interest as having been chairman of the Rail Freight Group. These regulations add a great deal of bureaucracy, and I would be glad to hear what arrangements will be required for drivers with licences from other member states to come here. Is there a two-year window there?

My second comment relates to paragraph 7.8 of the Explanatory Memorandum. This SI removes the duty to inform the Commission on licences and safety matters and, presumably, vice versa. The statement that we do not need to tell the Commission anymore and it does not need to tell us is putting our head in the sand about anything to do with railway safety. Railways are rule-based operations and the more common rules we have the easier it goes. The transfer of information on safety, accidents, driver qualifications and so on, in the widest possible sense, is surely good for the safe operation of our railways. The text of paragraph 7.8 and elsewhere is drafted in a very negative way. Even if there is not a requirement—I think there should be—to exchange data, I hope the Minister will say that the ORR and the European Railway Agency should be encouraged to exchange data and participate in putting it together in common, European co-ordinated, long-term information about the safety performance of railways over the years. I look forward to the Minister’s response.

[Lord Snape (Lab)]

My Lords, the House will be grateful to my noble friend for tabling this Motion to Regret—

[Baroness Sugg]

We have not quite got to the Motion to Regret yet. We are starting with the two SIs.

[Lord Liddle (Lab)]

My Lords, I strongly support what my noble friend Lord Berkeley said. I feel very passionately on this subject. First, one of the great things we have seen in the past two decades is the expansion of cross-border rail services. It is important for freight, where in the long term we want to try to take as much lorry traffic off the roads as possible, and it is also very important for expanding passenger networks across Europe and providing a real alternative to air travel, which has damaging effects on climate. I understand my noble friend’s concerns about why we are not promoting the maximum exchange of information and co-operation with our European partners in the event of Brexit.

Secondly, I would like assurances about rail services on the island of Ireland. This is very important to good relations between Britain and Ireland. The development of railways on the island of Ireland is a way of encouraging tourism in north and south. I would like to hear from the Minister that nothing is being done that will in any way be a barrier to the development of that co-operation.

--- Later in debate ---

There are other references, but the area I would like the Minister to expand on in some detail is the whole situation of the Channel Tunnel. How will it be legal for UK drivers to drive through the tunnel and then on to Brussels, Paris and, I hope, other destinations in Europe, as my noble friend Lord Berkeley pointed out? Is that flexibility already allowed for through other treaties, or will it require further bilateral agreements?

[Baroness Sugg]

I thank noble Lords for their consideration of these draft regulations. I agree with all noble Lords that sharing information is very important, not least because of safety. There will still be a power, rather than a duty, to share information on train driving licences with other member states. That will enable mutual sharing arrangements to be put in place. It is our long-term aspiration to continue to share that information.

On numbers of driving licences, the vast majority of people driving trains in the UK have an ORR-issued licence. There are around 250 drivers in the UK who have licences issued under the EEA. Those licences will be recognised for up to two years. In answer to the point from the noble Baroness, Lady Randerson, it is up to two years because they may expire before then. If they do, they will need to be replaced. That two years is from exit day, which is currently defined as 29 March, but if that definition changes, it will be two years on from that.

[Lord Berkeley]

Going back to the Minister’s last comment about sharing information, paragraph 7.8 of the Explanatory Memorandum on train driving licences says:

“The duty to inform EEA safety authorities will be replaced by a discretionary power to provide such information for the two-year period during which European licences continue to be recognised, and then will cease altogether”.


That is not quite the same. I understand what she says about wanting to continue to share information, but that does not appear to be the intent of this document.

[Baroness Sugg]

I presume that that is the case because we have the two-year implementation period and our future relationship will be subject to negotiations. As I said, our long-term aspiration is to share that information. We think a legal duty is inappropriate, because another authority might refuse to receive information or co-operate, so we would not be able to fulfil that duty.

[Lord Deben (Con)]

Can my noble friend imagine any circumstances whatever in which the British Government would not want to share such information with our neighbours? Why on earth are we talking about negotiation? Of course we will do that and of course they will want to do that with us. What are we talking about?

[Baroness Sugg]

As I said previously, it is absolutely our intention to continue to share information. It is important that we do so, not least because of safety. We will continue to have a very close relationship with our European neighbours, and we very much hope to share the information with them. Obviously, they will have to accept that information from us, but our long-term aspiration is to continue to share it.

[Baroness Altmann]

I know my noble friend is in a difficult position, but it is rather difficult for the House when the SI we are considering says that the exchange of information will cease altogether after the two-year period. I share the concerns expressed by my noble friend Lord Deben.

[Baroness Sugg]

I hope that I am able to provide further reassurance that we wish to continue to share information with our neighbours. Obviously, the exact format of that and how we do it will be subject to our future relationship.

On the number of licensed operators, there are 250 drivers in the UK. We are confident that they will relicense with the ORR within the next two years. We notified the industry of this requirement in 2017. Train operators would normally do this on behalf of their drivers in almost every case.

A small number of drivers are using ORR-issued licences in the EU. These will not be recognised in a no-deal scenario, but we have worked with the regulator and operators to ensure that those drivers are aware of the need to obtain an EU licence. I am sorry that the driver who the noble Lord, Lord Berkeley, spoke to was not aware of that. If I can get some more information on that, perhaps we can get in contact with them and make sure they are aware.

Following engagement with operators, we are confident that they are aware of everything that they need to do. The technical notices that we published back in October set out the position. We are confident that all relevant operators will have relicensed their train drivers before exit.

A number of noble Lords mentioned the Channel Tunnel. Under EU law, Eurotunnel, as an operator of the shuttle service, is not required to hold and operate a licence. It is a unique cross-border operation and is therefore unaffected by the operator licensing provisions. Eurotunnel engages both UK and French-licensed train drivers to operate its shuttle services. Its ORR-licensed train drivers will be unaffected by these regulations. The Government are working closely with European counterparts, including France, on bilateral arrangements for train drivers operating the freight service and the shuttle service through the Channel Tunnel. The intention is to ensure that the current licensing arrangements are maintained, meaning that Eurotunnel can continue to engage both UK and EU-licensed train drivers in its shuttle operation.

We are also supporting operators with contingency plans. We strongly support the EU’s proposed contingency measures on rail, which will help mitigate any disruption to Eurotunnel shuttle services regarding train driving licences and provide more time for the bilateral arrangements which we expect to be put in place.

The draft regulations from the EU cover UK-issued licences, certificates and authorisations, remaining valid for cross-border rail services for nine months from the date of exit. That will cover both Channel Tunnel services and cross-border services on the island of Ireland. COREPER endorsed this on 20 March. The proposal is expected to be adopted by written procedure tomorrow by the Council of Ministers, and we expect it to take effect early next week. We strongly support those contingency measures. Our future arrangements may well be bilateral, but that nine-month period gives us enough time to get them into place.

[Lord Tunnicliffe]

I am sure everything the Minister says is accurate and that if I understood the treaty I would understand what she said, but can we translate it into practical terms? By Eurostar services, I assume that she means those to Brussels and Paris—and some intermediate stops which I cannot remember. I think she is telling the House that, on Saturday week, those services will be able to run; and I think she said that the shuttle service would be able to run. But say somebody wants to start a service—as people do aspire to—from London to Milan; is there a bilateral agreement that will allow that to happen or is it one of the many that would have to be negotiated? What if we start running a wider variety of services through the tunnel, such as London to Milan or London to Lyons, through France and into a third country?

[Baroness Sugg]

The regulation refers to services that are currently running, which will not be affected on day one or after. New services will be subject to separate authorisation and agreements. We hope that our future bilateral arrangements with member states would allow those new services to function, but, at the moment, the proposed regulations cover existing ones.

On the island of Ireland, the draft regulations make provision for licensing arrangements in Great Britain, with the exception of technical corrections to EU-implemented legislation with effect in Great Britain and Northern Ireland. A separate instrument is being taken forward on behalf of Northern Ireland. As with Channel Tunnel services, the UK is engaging very closely with Irish authorities, as well as with the operators of the Enterprise service, to make sure that appropriate arrangements are in place to see the continued smooth function of that service in the event of no deal. Licences issued by Northern Ireland will be valid in the UK and the draft EU regulation will support the smooth running of cross-border services, so that there will be no disruption there.

The Government are, of course, committed to maintaining high safety standards on our railways. We will probably come on to this in our next debate, on future divergence, but we are clear that we will continue to fully engage with industry to look at the impacts—particularly the safety, commercial and cost impacts—of future changes in our railways.

There was a full consultation on operator licences, as part of the consultation on implementing the market pillar directive of the fourth railway package in the UK. The noble Baroness, Lady Randerson, rightly pointed out that we had a workshop on train driving licences. Unions were invited to attend, but I do not believe that they did. However, there has been extensive engagement between cross-border operators and the unions on arrangements for the licensing of their drivers in the event of no deal. As I have said before, the vast majority of drivers in the UK will be unaffected by this. The Secretary of State has also written to the general secretary of the ASLEF union, outlining our preparations and the actions that industry should be taking in advance of 29 March.

There will be no substantive increase in the ORR’s workload as a consequence of this. On exit day there will be no change to the validity of any existing licences being used. Currently, only one operator providing train services in Great Britain is using a licence issued by an EU member state. After two years, that operator will need to apply to the ORR, but there is no further burden on their resources.

I hope that I have answered noble Lords’ questions—

[Lord Tunnicliffe]

The noble Baroness has accepted that bilateral negotiations will be necessary in order to extend services through the tunnel to other destinations. Have these started? Is there clarity on who to talk to? Have there been any informal discussions to give us some optimism that there will be favourable outcomes?

[Baroness Sugg]

Bilateral conversations have indeed started. They have not yet been finalised; we would have been able to finalise an agreement in time for exit day had the EU regulations not come into force. I am not entirely sure whether future services are part of those conversations, but we very much hope we can ensure they can happen after we leave the European Union. We are working very closely with all our European counterparts, including France, regarding bilateral arrangements on licensing and certification, the existing international rail freight services, and passenger services. Given the EU regulations, we are confident of mitigating the disruption to those services. As I say, we are also working very closely with the rail operators to make sure they are prepared and hold valid EU licences where they need them and certificates to continue operating in the EU in the event of no deal.

--- Later in debate ---

[Baroness Sugg]

I fear that I have done only nearly 40 statutory instruments in this Chamber or in the Moses Room. The noble Lord has the happy responsibility of covering more than one department, unlike myself. But I agree with the noble Lord that it has taken up a significant amount of my time, my department’s time and officials’ time. I am not able to quantify exactly how many hours that has been. We are hopeful of reaching agreement with the EU, so that we will not need these no-deal SIs. However, until it is agreed by the European Union and the date of our exit is changed by both Houses of Parliament, we will need to continue to put these in place—they are necessary.

These draft regulations will ensure that our train driver and operator licensing system continues to function effectively when we leave the EU. Maintaining the status quo as regards the requirements and duties placed on train drivers and operators is necessary to ensure that the licensing regime remains robust. These SIs deliver the Government’s objective of maintaining the status quo, avoiding uncertainty for train drivers and operators in respect of train driving licensing and certification and operator licensing. I think I have answered most questions, and I will write to the noble Lord on paragraph 7.7. I commend the regulations to the House.

Motion agreed.