Rising Cost of Transport

Cheryl Gillan Excerpts

Wednesday 9th January 2013 Commons Chamber

[The Secretary of State for Transport (Mr Patrick McLoughlin)]

I start on a bipartisan note by joining the hon. Member for Garston and Halewood (Maria Eagle) in wishing her colleague the hon. Member for Barrow and Furness (John Woodcock), whom I see in his place, a speedy recovery and return to the Front Bench. We all wish him well and understand why he has taken the decision that he has in the short term.

I could not help but think that the hon. Member for Garston and Halewood and myself must have lived in different countries. From listening to her speech, it was almost as if there had been utopia until the general election, with everything fine and wonderful and the train companies bowing to the wishes of the Government and always doing what was right by consumers and the Government. Then I read a few Select Committee reports from the last Parliament to put me on the right track. I could not help but be struck by a report of the Transport Committee from 2006, when it had a Labour majority and a Labour Chairman. It stated:

“Both the Department for Transport and the train operating companies quoted growth and the fact that ‘the UK has the fastest-growing rail patronage in Europe’ as reasons not to be overly concerned about price levels. Indeed, the Government demonstrated breathtaking complacency”

about fares and ticketing. The hon. Lady should not imagine that the problem of fare rises is new. She said that there was no recession then, but we were about to go into one of the biggest recessions that this country has ever suffered. I will come to that a little later, but I am conscious of time—although you did not tell me to be brief, Mr Deputy Speaker, I am aware of the fact that you said there will be a time limit on speeches. I will try to be a lot briefer than the shadow Secretary of State was in her 30-minute opening speech.

I am afraid that a lot of what the hon. Lady said was a mixture of the ill informed and the inaccurate. The motion does nothing to help passengers or investment, and it says all that we need to know about the Labour party. Let us be plain about some of the facts, which might help the Opposition. The motion calls on the Government to cap regulated fares at 1% above inflation. We have. It was the last Government who planned for 70% of costs to be met by fare payers in 2013 and 2014, which would mean fares rising this year not by 1% above inflation but by double that. The fare rises are lower than they would have been under Labour’s plans. That would have been an additional tax on hard-working commuters that we have not been prepared to impose.

I do agree with the shadow Secretary of State on some things. She has said that

“we should reduce the public subsidy to the rail industry”.—[Official Report, 19 May 2011; Vol. 528, c. 522.]

I agree. She has also said that if she were running the Department’s budget now,

“we would have to make difficult and painful decisions in respect of cutting the deficit”.

Indeed, and Labour did make some of those difficult decisions. She talked about ticket office opening hours, and it is a fact that in the last five years of the Labour Government, Ministers approved cuts in opening hours at approximately 300 stations. Now the Opposition seem to think that that is wholly wrong, but they were only too aware of the need for it when they were in government.

I agree with the hon. Lady, too, that it is right that we have a record level of investment in our railways at the moment, and that railway passengers have to contribute to that as well as the taxpayer. We have more trains and better services and we are delivering new lines. We are also delivering for passengers by capping the average increase in regulated fares at RPI plus 1% not just this year but last year and next.

[Mrs Cheryl Gillan (Chesham and Amersham) (Con)]

I note that my right hon. Friend and his fellow Ministers have a long-term aim of reducing the cost of railways to both passengers and taxpayers, and therefore ending the era of the above-inflation rail fare increase. Will he therefore reassure me that he will not look to the taxpayer and the fare-paying passenger to bear the £33 billion cost of his plans for the High Speed 2 railway?

[Mr McLoughlin]

I am grateful to reaffirm to my right hon. Friend the Government’s commitment to adopt what was Lord Adonis’s plan for HS2, and I pay tribute to the former Secretary of State. My right hon. Friend and I disagree on HS2. I believe that it is vital for future investment and opportunities for the whole country. I will say more about that in the House in a few weeks’ time.

--- Later in debate ---

[Andrew Jones (Harrogate and Knaresborough) (Con)]

The motion before us is very disappointing. It fails to recognise why there are costs in our transport system or what the Government are already doing about them.

I want to focus on the rail network, because it is the transport area undergoing the most significant change, as we are in the biggest period of rail investment since the Victorian era. We all know that there are inefficiencies in our rail system. The McNulty review, which was commissioned by the previous Government, reported inefficiencies of between £2.5 billion and £3.5 billion in the system, and found that our railways were up to 40% less efficient than the best of our European counterparts. Those are inconvenient facts that the motion ignores. It also ignores the success of the industry. As my right hon. Friend the Secretary of State mentioned, there are as many passengers on our rail network now as there were in the 1920s, yet the network is significantly smaller than it was then. That is one of the causes of overcrowding. It also shows, however, that passengers are choosing to use rail.

I am going to talk about an area in which the Government have introduced a radical change of policy that will cut costs for passengers and improve the service they receive. That policy is rail electrification. Let me remind the House of how the UK performs in this area. We have electrified 34% of our network. In 2010, the UK was 20th out of 29 European countries in the league table of electrification. We are ahead of the former Yugoslav Republic of Macedonia, Latvia, Estonia, Greece and Lithuania. Wales and Albania were the only two countries without a single mile of electrified railway.

Why does this matter? It matters because electrified railways are cheaper to run. Electric trains are cheaper to buy. They weigh less, and so put less wear and tear on the network, which in turn costs less to maintain. They require less engine space, and so can accommodate more passengers, which contributes to the capacity issue. They can accelerate and decelerate more quickly than diesel trains. This means that passengers can enjoy faster journey times or that there can be more stops for the same journey time, or that there can be a combination of the two. They are also, of course, more environmentally friendly. Rail electrification is part of the long-term solution in taking cost out of running our railways.

I mentioned earlier that this area has seen a radical change of policy direction. Labour managed just 10 miles of rail electrification in 13 years. That is not even a snail’s pace. In contrast, this Government have announced 850 miles, and we are only halfway through this Parliament. That represents a huge change of scale and ambition, tackling cost and capacity for the longer term.

[Mrs Gillan]

Does my hon. Friend agree that this Government have also led the way by announcing the electrification of the railway line from London all the way down to Swansea and, more importantly, the electrification of the valleys lines in south Wales, which will mean a great deal to a large number of people? I am pleased to say that those measures are supported by Members on both sides of the House, and I look forward to the projects being completed in due course.

[Andrew Jones]

I completely agree with my right hon. Friend. This is not just an abstract policy; we are seeing real change on the ground, and there is good news right across the country. As she says, the Great Western main line is being electrified between London and Swansea, along with the valleys lines and the vale of Glamorgan line, which will bring electrification to Wales for the first time. The midland main line is being electrified between London and Sheffield, and that will obviously include Loughborough. A matter of great importance to my constituents in Harrogate and Knaresborough will be the electrification of the TransPennine Express services between Leeds and Manchester. That is just part of the massive rail investment that we are seeing in the north. There are many other projects, and I would like to highlight the complete funding of the northern hub, which will vastly increase capacity between our great northern cities.

Those projects involve major long-term funding decisions. Sometimes, we have been reluctant to take such decisions, but not under this Government. The ministerial team deserves praise for that. However, I cannot resist taking this opportunity to highlight a marvellous electrification opportunity. This is a bit of a local advert, and I thank the Ministers for listening. I am talking about the Leeds-Harrogate-York line. The line has up to 3 million passengers a year, its usage is growing rapidly and it serves an area of high economic activity. The area also has a significant visitor economy. The Harrogate international conference centre attracts more than 300,000 visitors a year, and 500,000 visitors attend the Great Yorkshire show each year. The area is so inadequately served by its rail facilities, however, that less than 20% of its visitors arrive by rail.

Electrification of the line is part of the solution. There is enormous support for the electrification of our line—from all the councils along the route, from the West Yorkshire passenger transport executive and, of course, from all the local chambers of trade and commerce. May I therefore ask the Minister, perhaps a little cheekily, to look at what can be done for the Leeds-Harrogate-York line and to meet me and colleagues to discuss it?

The questions we should be asking today about transport costs are not those in the motion before us. We should be looking at the underlying reasons why we have cost in the system. I think the Opposition know that, which is why they commissioned the McNulty report in the first place. Overall, I completely agree with the desire to cut the cost of travel in the UK, but I will not support the motion because it fails to take so many important issues into account.

I have been talking about rail solutions, but the Government have been taking action in other areas, as well. We should look at the different approach to fuel duty. The last Government increased fuel duty 12 times, and left office with six further rises planned. This Government have stopped them, and as a result motorists are seeing fuel duty 13p a litre lower.

I welcome the Opposition’s interest in delivering value for taxpayers and passengers, but it is a late conversion. As identified in the McNulty report, they left our rail network inefficient. Under the last Government, rail subsidy went up by 337% at a time when passengers saw real-terms fare rises. Bus subsidies went up by 127%, despite real-terms fare increases again. It is only by tackling the underlying drivers of cost that better value will be delivered for taxpayers. This motion does not even consider that, which is why I will not support it.