Rail Franchising

Huw Merriman Excerpts

Wednesday 10th January 2018 Commons Chamber

[Andy McDonald]

My hon. Friend makes a good point, and I will return to those themes.

The Government are unable to accept that the franchise model, which is demonstrably failing, is a betrayal of the public who plough billions of pounds of taxes into the railway. It is a betrayal of the passengers who face eye-watering fare rises year after year. It is a betrayal of the hundreds of thousands of dedicated and passionate people who have worked in the rail industry for decades.

[Huw Merriman (Bexhill and Battle) (Con)]

I thank the hon. Gentleman for his kindness to me just before Christmas. Will he confirm whether fare rises have been faster under this Government or the last Labour Government?

[Andy McDonald]

Labour’s position is that if we were in power, we would not raise fares by the retail prices index or by RPI plus 1. We would save each member of the travelling public £500 during this Parliament.

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[Chris Grayling]

The hon. Gentleman is bankrolled by the people who are inappropriately disrupting parts of the network and are politically driven. They disrupt the lives of passengers for political purposes. The Labour party should disown the unions and their current action. The hon. Gentleman’s conduct on this is not acceptable,

[Huw Merriman]

On my daily commute, as I walked through London Bridge station—as I know my right hon. Friend does—where there have been a lot of difficulties for me and my constituents, I noted that it is now an absolute temple to travel. We should talk positively about our rail system and not just knock it.

[Andy McDonald]

On a point of order, Madam Deputy Speaker. I do not know whether you heard what I did, but I think that I have been accused of unacceptable behaviour. I really think that needs to be clarified. I have tried to conduct myself with all civility and propriety, and what the Secretary of State said is regrettable. I seek your guidance on that point.

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[Will Quince (Colchester) (Con)]

Thank you, Madam Deputy Speaker, for calling me to speak in this debate. It is a pleasure to follow the hon. Member for Garston and Halewood (Maria Eagle) despite my not agreeing with what she had to say. The cost of an annual ticket from Colchester to London is now £5,104 and I am in no doubt that that is a huge amount of money for my constituents. However, despite what is claimed by the Opposition, including the hon. Lady, the fares are not lining the pockets of rail companies. For every £1 spent on fares, 97p goes on the running and improvement of our railways. However, when our constituents pay such amounts to travel to work they need to see value for money.

To be fair, passengers on Abellio, which runs the service to Colchester, will see real benefits from the new franchise. Over 1,000 brand-new carriages are coming into service from next year, at a cost of over £1 billion—I assume that that is another £1 billion that Labour would borrow. There will be free wi-fi for all passengers at stations and on trains. Season ticket holders and those who buy their tickets in advance will benefit from automatic Delay Repay. All those things will make a massive difference, and I have only one ask for the Department. The new 15-minute threshold for Delay Repay was announced after Abellio was awarded the franchise, so as things stand it is likely that it will not be introduced until a new franchise is awarded in 2025. My constituents, Abellio and I would like to see that implemented earlier, so I ask the Department and the new Minister, my hon. Friend the Member for Orpington (Joseph Johnson), whom I welcome to his place, to see whether they can make it happen as soon as possible.

However, I will not stand here and pretend that the current franchising system is perfect. We still have issues with competition and with the number of companies coming forward.

[Huw Merriman]

On competition, my hon. Friend may remember a Transport Committee report in which we found that the same big companies were bidding and that there was not enough competition.

[Will Quince]

I have served on the Transport Committee with my hon. Friend for two years. He is right that, in the invitation to tender for our most recent franchise on the Great Eastern main line, the three companies that put in a bid were Abellio, the existing franchise holder; National Express, which had had the franchise taken away when it was given to Abellio; and FirstGroup, which had had the franchise taken away when it was given to National Express. He is right that we need to encourage more bids.

Large franchises mean that multimillion-pound bonds are put up by companies that are looking to run the services, and there is a lot of risk even for large companies. We should consider creating smaller franchises that carry less risk, thereby attracting more interest and more bids, delivering more competition and, ultimately, better value for taxpayers’ money.

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[Huw Merriman (Bexhill and Battle) (Con)]

It is a great pleasure to follow the hon. Member for Wigan (Lisa Nandy).

This morning, on my daily commute to this place—I am one of the few people who are fortunate enough to be able to commute here from East Sussex—I walked through London Bridge station, which has caused me and many of my constituents enormous difficulties because it has been rebuilt and its tracks reconstructed. It now looks absolutely fantastic and is a shining example of the £40 billion investment that the Government have put into the railways and the difference that that has made.

I wish to talk up our railways and their success. Let us remember that since 1997, under the current Administration and the previous Labour Administration, the number of passengers on our railways has doubled. The rail system now largely pays for itself; it does not need the £2 billion a year taxpayer subsidy that British Rail took to not run things properly. When we compare our rail system to those in Europe, we see that we have the second safest railway after Ireland; that we have the second best-performing railway in terms of passenger feedback, second only to Finland; that we use our rail system over 60% more than the European average; and that we have put more investment into our railways than any other EU country. We should talk up the rail system’s success, because not only is there all that, but it employs 250,000 people, releases about £11 billion of costs that would otherwise go on congestion charging, reduces carbon dioxide emissions by 8.4 million tonnes, and adds £10 billion to our gross value added. So we should all talk about the success of our rail story.

Of course, though, there are challenges. We have certainly seen challenges with the Southern network. We have really suffered with strikes and a poorly performing operator, and that has been laid bare today. Nevertheless, we should not forget that the unionisation of the rail network has caused enormous problems. It should be well remembered that the same train drivers who have now pledged to drive the trains that they said were not safe have taken a 28.5% pay rise. That is a much greater pay rise than the passengers who are paying for their rail tickets each year got. All Members need to recognise that costs such as that result in our passengers paying more and more.

Let us give something back to the passengers. At the moment, Network Rail has to compensate rail operators for any delays it causes. Only a third of the passengers who experience those same delays claim their compensation, so train operators are keeping the money. I want the train operators to be required to bank that money.

[Will Quince]

Is my hon. Friend making the point that I suspect he is going to make about automatic Delay Repay being included in future franchise agreements?

[Huw Merriman]

I am indeed; I thank my hon. Friend for helping me to finish my sentence. The rail operators should be required to bank that money and put it in a pot so that it can be spent only on new technology for trains. That technology would mean that everybody would be required to tap in and out of their train journey, and if by the time they got to their destination they were more than 15 or 30 minutes late, they could have the compensation credited to their bank account when they tapped out. In this day and age, there is no need for passengers to go through the timely, costly and bureaucratic exercise of claiming, which is why they currently do not claim. I have introduced a private Member’s Bill, which I hope will be given its Second Reading at the end of March, and I would like the Minister to get behind it. I believe that the technology does exist and that, with more will, the train operators could put it in place. That would give more back to the passenger.

It is all well and good to talk about the public good, and I recognise a lot of Network Rail’s good work, but it has also been responsible for a large proportion of the delays for which the train operators have taken the flack. It is time to do more than just stick with what we have; we should make all the track the responsibility of the train operators. We should also question whether some stations should be transferred out of Network Rail’s control.