Cost of Living

Debate between Gavin Shuker and Baroness Chapman of Darlington

Wednesday 16th May 2012 Commons Chamber

[Mrs Jenny Chapman (Darlington) (Lab)]

It is a pleasure to follow my hon. Friend the Member for North West Durham (Pat Glass). I cannot help but agree with her final remarks, contrasting the conflicting priorities of the Government and the people we represent. I have not yet had any correspondence, phone calls or visits to my surgeries to discuss House of Lords reform, and I look forward to having those conversations, should they arise.

At the moment, we talk much more about local bus services in Darlington, a problem that has been brewing for quite some time. It all started for us in the north-east, particularly in my town, in the 1990s, when bus services were deregulated with a view to creating choice and competition, improving service and getting fares down—I think that was the plan. Let me share with colleagues what happened in Darlington—the experience is not unique to Darlington, but I think the problems were perhaps more pronounced there than anywhere else.

We had gridlock on our streets due to bus wars. Two big bus companies decided to compete for the same routes and both ran free buses around the town in an attempt to get the other company off the road. That did not help consumers and passengers in the town. It did not improve public transport. Instead, it landed us with, in effect, a council tax payer-subsided monopoly on bus services in Darlington, and we have pretty much been stuck in that position ever since. Now, the council is having to make difficult decisions on the subsidy it offers to run some of the routes, but I cannot even find out how much council tax payers are paying to subsidise a route across Darlington. Extraordinarily, I have been told that the information is commercially sensitive. Council tax payers in Darlington are subsidising to the tune of roughly £500,000 a year a company owned by a business in Germany that turns a profit of about £500 million a year, yet we do not know exactly how much we are paying for our bus routes. That is an intolerable situation for my constituents.

That is a big problem for us because, according to Passenger Focus, 34% of residents in my constituency have no access to private transport and are forced to use the bus services. Recently, I was quite stunned to see a London Routemaster bus travelling down one of the main arterial roads into Darlington. It was there because the engines of the new Routemasters are made in Darlington, and they were being tested. However, that sight brought home to me the contrast between the services available to people in major cities such as London, which are excellent, and those available elsewhere, where fares are not regulated, ticketing does not allow use across different services, and routes and timetables are not integrated. Most worrying for me, there are few means short of spending hundreds of thousands of pounds each year on subsidies by which residents and communities, and even councillors and MPs, can influence the routes on offer.

Fares in Darlington have increased by 6.1% in the past year, which is considerably more than inflation. We need to take a look at fares, given that bus users tend to be the young, the elderly and those on low incomes. I would strongly support the creation of a strategic transport infrastructure, or a body similar to Transport for London for the rest of the country, so that the system can be monitored and organised much more effectively.

[Gavin Shuker (Luton South) (Lab/Co-op)]

Does my hon. Friend agree that one of the reasons why the major increases in fares are so bad is that for many people, they are essentially a tax on work? People need to be able to get to work to obtain employment and to keep their living standards high.

[Mrs Chapman]

My hon. Friend makes a very good point. It has been made before in the debate, and we need to consider it.

I have constituents who previously needed to use two buses to get to work, at considerable expense and with no cross-ticketing. They were just about able to manage that, but now those bus services have been removed. Somebody who works after 6 o’clock at night, or who lives in one of the surrounding villages, cannot keep their job. I know people in my constituency who are no longer in employment because the bus services have been removed.

It is not just people in work that are affected but people who rely on health services. I am sure we all have stalwart, hard-working councillors in our constituencies, and I have one in particular, Bev Hutchinson, who is relatively newly elected and a fairly formidable woman. She has taken it upon herself to take surveys on buses around the town. She found a constituent, Betty Sowersby, who is 74 and lives on Barmpton lane in Darlington. Betty told The Northern Echo that she was in hospital for a major operation in March and now could not use the bus to get back from her doctor’s surgery, where the doctor checked how her wounds were healing. She said that there were a lot of elderly people like her along her street who could no longer even go and do their shopping independently.

When civil servants and policy people consider bus issues, they too often focus on the problems of getting around London and major cities and do not think enough about the day-to-day problems facing people living in regions such as my own. Those problems exist in rural areas and even in quite large towns such as Darlington, where no integrated structure exists. Local government is not in a position to subsidise bus companies in the way it has in recent years. One could argue that perhaps it should not have been doing that, but that is how the system has been maintained for the past decade. It cannot be maintained like that in the future, so the Government need to give serious thought to how to provide bus services in our regions from now on.

--- Later in debate ---

[Gavin Shuker]

We are jumping around in water here. My hon. Friend is my new colleague in the shadow Environment, Food and Rural Affairs team and I am sure hon. Members on both sides of the House would want to welcome him back to the Front Bench. He makes an extremely good point. What is required in the industry to move water from places where it is in good supply to areas where there is less? For me, that is not primarily about building a big pipeline from north to south; it is also means getting interconnectors between different water companies working appropriately. Of course, the carbon cost of that is great.

[Mrs Chapman]

Does my hon. Friend believe it is easier to move water around than it is to move people? We have plenty of water in the north-east, but we could do with more people and more jobs. If there were a more even distribution of people and jobs, we could save ourselves the job of moving water.

[Gavin Shuker]

My hon. Friend once again makes a great point, but the key point missed by the lack of action on water in the Queen’s Speech is that we can reduce demand as well as increase supply. There is increasing need in growing areas such as London, the south-east and, for example, Yorkshire, where there could be 1 million new household customers in the market in the next 10 years, but there would be benefits for all if we could increase the number of people in an area without increasing the amount of water used.

Last month—April—water bills increased on average by about 5.7%, which is about £20 per year on the average bill. Ofwat estimates that 2.2 million households spend more than 5% of their disposable income on water. Sadly, the Queen’s Speech promises only the publication of a draft Bill, which shows a Government who refuse to take action.

The Gracious Speech contained a commitment to bring forward only a draft water Bill, which is disappointing because the Government have broken their promise to introduce a comprehensive water Bill in this parliamentary Session to reform the water industry. That means that the much needed reforms—the Opposition agree on what needs to be done—and action to keep bills affordable will be even more delayed, which is a slap in the face for the many families who are struggling to pay their water bills.

There was a flurry of activity in the previous Session to rush through the Water Industry (Financial Assistance) Act 2012. That legislation does nothing to tackle water affordability in the long term. In the short term, it will help households in the south-west to pay their water bills by giving them a direct £50 subsidy, but it is worth noting that without action to tackle affordability in the long term, that £50 will be gobbled up within two years because of the existing increases in that area. The Opposition believe that assistance should be extended to all households who are struggling to pay their bills, which is why I proposed amendments to ensure that water bills remained affordable for all.

As the Opposition know, with the wettest drought on record and hosepipe bans imposed on almost half the country, now, more than ever, we need urgent action to reform the water industry, to ensure that water supply meets demand and to stop the harmful practice of taking water out of the natural environment in places where we cannot afford to do so. It seems, however, that the Government have no sense of urgency. As we know, in politics momentum is everything. Right now, water issues, whether flooding, drought, rising costs for customers or other things, are at the forefront of people’s minds. This is a once-in-a-Parliament opportunity to take action on water.

The impact of climate change means that water resources will become more and more scarce. The recent droughts and floods could be an indication of what is to come. What needs to be done to ensure that water remains affordable for hard-pressed bill payers in the long term? Since the botched privatisation in the early ’90s, water bills have increased year on year. We could take urgent action on abstraction—taking water out of the natural environment—but the Government have promised no legislation until 2015, and they do not propose to complete that process until 2030.

We could also take urgent action on leakage. The problem is that water companies generally repair leaks only if it costs more in lost water not to do so. Ofwat sets targets, but many companies can go years at a time without making a significant reduction in their leakage rates. We need to ensure that the comprehensive water Bill, when it comes, tackles the issue of leakage head on. By 2015—the end of this Parliament—more households will be metered than unmetered, yet there is little evidence of the deep thought required on the matter from the Government.

The further delay confirmed in the Gracious Speech to the comprehensive water Bill is serious not only for those who care about the environment but for people right across Britain struggling to pay their utility bills against the backdrop of the highest unemployment rate for 16 years and the first double-dip recession in 37 years. While the Government continue to delay desperately needed reforms, hard-working families are feeling the pinch and footing the bill.