East Coast Main Line

Ian Lavery Excerpts

Wednesday 5th June 2013 Westminster Hall

[Ian Lavery (Wansbeck) (Lab)]

As ever, Dr McCrea, it is a pleasure to serve under your chairmanship, and I congratulate my hon. Friend the Member for Middlesbrough (Andy McDonald) on making an excellent contribution to the debate.

I have only three minutes to speak, which does not give me much time to consider the privatisation or nationalisation of the east coast main line; I would need a lot of time to do that. Quite simply, I will focus on saying that the privatisation of the railways—some might even say the theft of the railway infrastructure—is totally unacceptable. It has been an unmitigated disaster, and franchise after franchise on the east coast main line has been a shining example of that.

I have looked at the results of the east coast main line. Since it has been in public ownership, it has been absolutely outstanding and there have been some things that private companies would be absolutely delighted with: increased passenger numbers, profits, premium payments and passenger satisfaction, and better turnover and punctuality. Also, passenger fare revenue has increased by 34% to £820 million. In 2012, turnover was £665.8 million, which was an increase of £20 million, leaving a profit before tax and service payments to the Department for Transport of £195.7 million, which was an increase of £13 million. Passenger journeys with East Coast, which runs trains from London to Yorkshire and from the north-east of England to Scotland, increased by 2.1% in 2012.

In addition, there is another important point, which I think has been agreed on by Members of all parties today. Customer satisfaction with East Coast has risen by 2%. Also, the company’s latest punctuality figures are the best since records began in 1999. What a credit to East Coast that is, and why on earth the Government are hoping to privatise the east coast main line quite frankly beggars belief. Again, it is about absolute ideology and absolute dogma, and who will benefit from this privatisation? It will not be the passengers and it will not be the work force; the financial bonanza will be distributed between shareholders.

I ask the Minister why on earth National Express—a company that threw the keys back at the Government because it could not cope with privatisation last time—will be allowed to bid for the east coast main line for a second time. If it could not cope the first time, why is it even being allowed to put itself forward a second time?

--- Later in debate ---

[Mr Burns]

I am going to make progress, because I have only six minutes.

We have ensured that the delivery of the key inter-city franchises, both on the east coast and the west coast, is staggered so that they are not let at the same time in the economic cycle. The east coast is the first of those franchises to be let, and it is being returned to the private sector, as hon. Members know, after an extended and successful period of public ownership through force of necessity because of the fiasco with National Express. No one doubts that.

[Ian Lavery]

Will the Minister give way?

[Mr Burns]

No, I do not have time. I am not giving way.

When my right hon. Friend the Secretary of State announced the new franchise programme, he set out three key principles that we want rail franchising to follow: first, that passengers gain; secondly, that the rail industry thrives, with growing companies and new competitors coming into the market; and thirdly, that the taxpayer gains through more efficient use of public money and less waste in the industry. We believe that letting the east coast main line back to the private sector in line with those three principles will deliver the best possible long-term outcome for passengers and taxpayers.

I am aware of a number of concerns raised by hon. Members, including the hon. Member for Aberdeen North (Mr Doran), on services to Scotland. Mindful of that, officials from the DFT who are developing the proposition for the future inter-city east coast franchise are meeting a number of interested parties along the route, including Transport Scotland, as I am sure he would expect, and other transport bodies in Scotland, as well as local authorities, to understand their concerns. The specification for the new franchise will address both current and potential markets along the franchise route, including those between London and Scotland and up to Aberdeen.

East Coast has delivered a great deal in the past three-and-a-half years of public ownership, which provides the foundations for more to be done by a private sector company that has certainty of ownership, longer planning horizons and an innovative and entrepreneurial approach to doing more for passengers and taxpayers. The operation of the east coast by the public sector was never intended to be a permanent arrangement.

Lord Adonis himself, when he was Secretary of State, said that he did not believe it was in the public interest for us to have a nationalised train operating company indefinitely, and I believe he still believes that. I would be fascinated if the hon. Member for Nottingham South (Lilian Greenwood) intervened to tell me exactly what he said when he told her that he had changed his mind, because I have great difficulty believing that someone as intellectually astute and consistent as the noble Lord Adonis has changed his mind now.

The announcement that we will return the franchise to the private sector in February 2015 provides the certainty that is needed so that longer-term plans for the business can be made. We now need a strong private sector partner.