Transport for London Bill [Lords]: Revival

Catherine West Excerpts

Monday 16th November 2015 Commons Chamber

[Claire Perry]

No, I will not.

We are trying to find flexible ways to allow the public sector to use its assets more effectively. Only a party whose face is firmly turned to the past—preferably the nationalised past of the 1970s—would find that an unpalatable mechanism.

[Catherine West (Hornsey and Wood Green) (Lab)]

Will the Minister give way?

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[Clive Efford]

Will the Minister give way?

[Catherine West]

Will the Minister give way?

[Claire Perry]

No, I will not.

Those constituents are delighted that fares have not been charged for children who are travelling, and they are delighted by the improvements that have been made to stations, including the provision of step-free access throughout the network.

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[Claire Perry]

Oh, do tempt me so I can make some more jokes about vans.

[Catherine West]

rose—

[Claire Perry]

I will take an intervention from the hon. Member for Hornsey and Wood Green (Catherine West) instead.

[Catherine West]

I thank the Minister for giving way. Does she accept that transport providers are often not the best organisations to launch into a business programme, particularly where we have examples such as that of Earls Court, which has been well and truly exposed tonight, where TfL did not get the best value for money or the best value for Londoners? There has been virtually no affordable housing in that scheme and that is the key concern for Londoners. That therefore proves that transport providers are not necessarily the best property developers.

[Claire Perry]

I am a bit confused by the hon. Lady’s intervention. I think what she is suggesting is we should not give TfL powers—that somehow we should retain these powers or not give it powers at all to try and maximise the commercial value. I will agree with the hon. Lady on this: most state-owned institutions are not good at maximising the value from these particular developments. The same is true across the railway network, but we have to look at different mechanisms to enable organisations to unlock the value from that public-private partnership which is so crucial.

TfL runs a world-class transport system. It is led by an expert transport commissioner.

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[Ian Lavery]

I have never had so many kind invitations in my life. I will enjoy the two visits that have been lined up. I wonder whether there is a third such visit.

[Catherine West]

My hon. Friend could not possibly fail to come to Finsbury Park, because that leads into the Stroud Green part of my constituency. Indeed, we have a problem with step-free access. Perhaps I will use this opportunity to lobby the Minister on that matter. We have long been promised step-free access at Finsbury Park. We have also been promised proper ticket barriers; ours is the only station in London without proper ticket barriers. My hon. Friend is welcome at any time to join us in Finsbury Park.

[Madam Deputy Speaker (Natascha Engel)]

Order. If we go through this debate station by station, we will be here for a very long time. This Bill goes rather wider than individual stations. Perhaps Members can bear that in mind and move along a little bit.

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[Ian Lavery]

Again, that is extremely concerning. I am not from the area, but I am sure that such cases have been experienced many times in many constituencies in the city. If any of my hon. Friends wanted to give any examples, I would be interested. The House should be prepared to listen to past experiences and to what has happened, as that is what we are likely to see if clause 5 is agreed to.

[Catherine West]

Will my hon. Friend accept as an example what happens now in the private rented sector, as opposed to the possibilities we might have had under a social housing deal? An income of £75,000 is needed for a household to rent in Finsbury Park. This is not Chelsea: in Finsbury Park, a family with three children wanting to rent in the private sector needs an annual income of £75,000. Is not that why we have such a desperate need for affordable homes? TfL has proved severely wanting as regards the Earls Court scheme and other schemes and that is why we are so desperate to stay in the Chamber at this late hour debating this important matter.

[Ian Lavery]

I thank my hon. Friend for that intervention; £75,000 is a king’s ransom to many people. It is not affordable in any way, shape or form.

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[Ian Lavery]

Indeed. Although the Bill is not long, it lacks transparency. A limited partnership differs slightly from a limited liability partnership. A limited partnership is a form of agreement between parties, not a distinct legal entity, with unclear consequences for public transparency measures, such as the Freedom of Information Act. In the other form of partnership, the general partner assumes unlimited risk, whereas the secondary or limited partners are liable only for the value of any investment they make. The limited partner may not be involved in the management of the partnership.

Although it is assumed that Transport for London would primarily take the role of a limited partner, the Bill would not prevent the organisation from acting as a general partner. If it assumed the role of limited partner, Transport for London would not be able to end the arrangement without the agreement of the general partner, as has already been mentioned.

[Catherine West]

Does my hon. Friend agree that those on the Labour Benches would feel much more generous towards the Bill had there been examples of Transport for London achieving what Londoners want, which is 50% affordable housing on all such deals? We got that in the case of Earl’s Court, rather than 10%. We need genuinely affordable homes—not the current definition of “affordable”, which is 80% of the market rate. We know that 80% of the market rate in London is completely unaffordable for the average earner, who is on about £28,000, £29,000 or £30,000 a year.

[Ian Lavery]

That is another excellent intervention that explains what a lot of people in this city are experiencing.

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[Ian Lavery]

I am not sure whether that was an intervention or another speech, but I thank the Minister.

[Catherine West]

This is not about the private sector per se, but the track record. In a large investment such as Earls Court, 10% affordable homes is not acceptable. The fire station in Clerkenwell closed because the Mayor of London was keen to see posh flats instead of services. Muswell Hill police station closed and is about to be sold for half a dozen posh flats. There is the continual sense that we are being ripped off. Transport providers are not necessarily the best people to be running property developments.

[Ian Lavery]

That point was made by my hon. Friend the Member for Westminster North (Ms Buck), who mentioned that ordinary people in London are jaundiced by the experiences they have had before. The police station or the fire station is bulldozed, there are the luxury flats that people do not live in, and then we have ghost towns, which means that there is a downward spiral in the local economies. The only people who make anything from it will be the property developers.

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[Rachael Maskell (York Central) (Lab/Co-op)]

I am glad to be able to make a contribution to this debate. I am not from the city of London—I am from the city of York, which is a railway city—but I have many concerns about the Bill, and many of my hon. Friends have touched on them this evening.

At the heart of the motion is the desire to revive the Bill, which started its journey five years ago. As we have heard, the housing situation in London has changed so much during that time that the Bill is no longer relevant. It left the House of Lords 20 months ago, so there have been plenty of opportunities to debate it. London’s housing situation has changed so considerably that the Bill must be called into question. We need a new Bill to address the real issues faced today, rather than a Bill that is clearly outdated. We are talking about a property market that largely did not exist five years ago.

[Catherine West]

Is my hon. Friend aware that, in just the past five years, Haringey, which includes Tottenham, has been considered a higher-value London area, with homes on sale for in excess of £500,000, and that first-time buyers are unable even to get on to the housing ladder? Indeed, on the Government’s flagship scheme to incentivise people to get a mortgage, one person has benefited—

[Madam Deputy Speaker (Mrs Eleanor Laing)]

Order. I am not having any more long interventions. There have been far too many.

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[Rachael Maskell]

I am grateful to my hon. Friend the Member for Harrow West (Mr Thomas) for the invitation to Harrow on the Hill station. I am sure that I will join many hon. Friends in going round the tube stations of London to examine the works that are waiting to be completed.

My hon. Friend makes the point that Transport for London needs a sharper focus on its work in improving our railway network and stations, including by making sure that stations are accessible to disabled people. Why should a disabled person have to wait to access transport? Surely that should be a priority for the Government. The reality is that so many questions are not answered in relation to the Bill.

One of the things we have heard a lot about is the price of housing and its consequences. We are not talking about the development of housing for people to live in, but about the building of assets on which people can make further money at the expense of others. As their assets build, inequality grows further and further in our city. Such inequality has an impact not only at the top end, but on others. If we look at one of the real consequences of inequality, we can see that there are serious skills shortages in the city. If we think about the impact on recruiting to the NHS because people cannot afford to live in central London—[Interruption.] The hon. Member for Milton Keynes South (Iain Stewart) is gesturing on the Conservative Benches, but the reality is that the constituents of some Conservative Members will face lots of consequences from not having enough nurses in their hospital. In fact, the Government are concerned about agency workers in our hospitals. Are we surprised when trained staff cannot even work in our NHS because they cannot afford to live nearby? Those are some of the consequences of not developing land for its social value and to put something back into our services. In fact, rail workers working for Transport for London will not be able to afford—

[Catherine West]

Is my hon. Friend aware that key workers cannot gain access to such housing because the key worker category has shot up so high in relation to the market?

[Rachael Maskell]

My hon. Friend makes a reasoned point. The centre of London is becoming void of key workers, teachers, people who work in hospitals and people who work in our railway system, and we will suffer the consequences. In fact, the construction workers who will be asked to work on these sites will not be able to live in central London and access those services.

As I did at the start of the debate, I ask about the financial modelling behind the Bill. There are many risks, but my concern was roused by a point made by my hon. Friend the Member for Lancaster and Fleetwood (Cat Smith). She talked about the new chair of Network Rail, who has come from Transport for London. Network Rail has a major footprint in my constituency, and once the principle is introduced, we could see these limited partnerships extended to many other areas. Sir Peter Hendy has transferred to Network Rail and he could bring the principle with him. I have a site in my constituency of 35 hectares of Network Rail brownfield land on which 1,100 houses could be built, but they would be high-value houses—

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[Daniel Zeichner]

My hon. Friend makes a very good point that a number of other Members have made: we are not convinced that TfL gets good deals, so why should we make it easier for it to make even less good deals in the future? We worry about that.

Our fear is that the really contentious clause 5 will make it still harder for local people to have influence over major decisions that affect their community. Our view is that regeneration is much better done from the bottom-up, with the assent of those who will be most directly affected—not top-down. Given that the land has already been sold off, the Earls Court development seems to be a bit of a done deal. What we seek to prevent are further lopsided private-public agreements that steamroll over neighbourhoods in the name of regeneration. We understand that TfL wants greater commercial freedoms, but those freedoms cannot come at the cost of denying a voice to ordinary people in London.

The core of the issue is the imprecise nature of the limited partnership itself. A partnership of that kind is not a distinct legal entity, and a lack of clarity surrounds the roles that would be played by each party in the partnership, where responsibility and accountability would lie, and who would really benefit most, the private developer or the public. We are advised that a limited partnership is able to change its general partner, but the partnership agreement would be unlikely to be made public, and its terms would not be open to public scrutiny. To be in the public body interest, genuine partnerships need far more transparency and accountability.

Furthermore, unless it is agreed for a fixed term, a limited partnership will be at will. A limited partnership at will may be dissolved on notice by a general partner, but, unless the agreement provides otherwise, not by a limited partner, which TfL is likely to be. Limited partnerships clearly vest a large amount of risk in their ventures, and we do not believe that these issues have been properly addressed. There is a real danger that TfL would be taking very large risks—indeed, unlimited risks. We do not think that it has considered carefully enough the long-term impacts of introducing powers to enter into such partnerships. For those reasons, we are cautious about the potential precedent, and we believe that the Government should also assess very carefully the appropriateness of other public transport authorities’ entering into limited partnerships.

Some of my hon. Friends have made powerful points. Much of what was said by my hon. Friend the Member for Islington South and Finsbury (Emily Thornberry)—who is no longer in the Chamber—hit the nail on the head. She was particularly critical about the prospect of a partnership’s changing at some future stage. It was telling that, when she challenged Conservative Members to explain how the process might work, they looked thoroughly uncomfortable and were unable to provide any reassurance.

I think that what my hon. Friend said about the price of a flat being £826,000 was one of the most telling comments that we have heard tonight. It told us so much about the current crisis. I feel deeply about that crisis, being an almost outer-outer London Member. Cambridge, which I represent, reflects all the attributes of the London housing market nowadays. [Interruption.] These are serious issues. Conservative Members are chuntering away as though it did not matter that people cannot afford to live in our great cities, but it does matter. The point that we are making is that if public bodies like TfL do not take this seriously, we are not relying on anyone else to do it.

[Catherine West]

My hon. Friend has made a valid point. Conservative Members are making light of what is the most important issue in London. Does he agree that it is outrageous that people need an annual income of £75,000 to be able to afford to rent a property in Finsbury Park—not Chelsea—for their families? [Interruption.]