Railways Bill (Twelfth sitting)
Keir Mather Excerpts(3 days, 4 hours ago)
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Rebecca Smith (South West Devon) (Con)
It is a pleasure to serve under your chairmanship, Mrs Hobhouse. There is not much to say, except that the hon. Member for Didcot and Wantage raised a question about our amendments and what he called phantom paths. I think he may have been referring to ghost trains, as opposed to phantom trains—if you google “phantom trains”, all sorts of weird films come up, and they are far too scary for me to watch. He is not here to disagree with me, but I think he was alluding to the issue of trains running entirely empty through stations where people would have quite liked to get on them.
The point I think we are making with our amendments is more about where issues that it is within Great British Railways’ responsibility to fix mean that services cannot run, and about not believing that the operators, which have no responsibility for the infrastructure, should still be expected to pay a fee if they are not able to run their services. I think we would have been alluding to that, rather than where they are running empty trains. There may well be empty trains as well, but I think we were talking specifically about where GBR had the responsibility—
The Parliamentary Under-Secretary of State for Transport (Keir Mather)
I thank the hon. Lady for giving me an opportunity to piggyback on her response to the Lib Dem spokesperson, the hon. Member for Didcot and Wantage. I want merely to say that, from the Government’s perspective, having one centralised body accountable for access to and use of the railway and for determining best use is a good way to avoid the phantom train scenarios she describes, such as the 7 o’clock service from Manchester Piccadilly to London. I am grateful that she has given me the opportunity to row in behind her on this point.
Rebecca Smith
I thank the Minister for that. Yes, absolutely; I believe our amendments are much more about the infrastructure that GBR has responsibility for and about operators not having to pay if they are un able to operate their services. A natural disaster is probably a bit too extreme, but if, for example, a train is running through to Dawlish and the line gets closed, I think it is fair to suggest that the operator should not have to pay the fees for that train. We will press some of these amendments to a vote for that reason, but I just wanted to clarify that point. Without further ado, I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Amendment proposed: 230, in clause 64, page 36, line 7, at end insert
“, except where the services cannot operate due to a failure of the GBR infrastructure or the need for GBR to take capacity for work on the network.”—(Rebecca Smith.)
This amendment would ensure that services are not caught within the charging scheme if they cannot operate due to GBR failures or actions.
Question put, That the amendment be made.
Edward Morello
It is a pleasure to serve under your chairship, Mrs Hobhouse. It will escape no one that, in the absence of my hon. Friend the Member for Didcot and Wantage, I have been left with my hand on the wheel. I do not think trains have a wheel, but I am not entirely sure how they work—[Interruption.] They have a stick, yes. However, given that both amendments are in his name and relate to the freight target, I can only assume that they are eminently sensible and that the Government should accept them. If not, we would apparently like to press them to a Division.
Keir Mather
It is, once again, a pleasure to serve under your chairship, Mrs Hobhouse. Amendment 254 would require GBR, when charging above the cost directly incurred—in other words, when charging mark-ups—to consider its target to increase the use of freight. I can reassure the hon. Member for West Dorset immediately that GBR will not be able to raise charges in a way that is not compatible with its statutory duties or targets.
In practice, that means that when developing its own test of affordability, GBR is expected to establish bespoke criteria for divergent market segments operating on the railway, including freight, as Network Rail set out in its discussion document on charging. That allows GBR to design a test that can support its duties, including those under clause 18, and the targets to increase freight under clause 17.
We intend that the provision will operate in a way similar to the “market can bear” test today. GBR will develop its own test of affordability in consultation with the sector, including the Office of Rail and Road, before publishing it. However, as we move away from European law, in which the “market can bear” test is established, and to the Bill, which carries over the same principles, we must ensure that the language in the drafting is fit for purpose for UK statute. That is why the Bill stipulates that GBR will be able to levy mark-ups only if it is affordable to efficient operators. The Bill preserves that fundamental safeguard for operators, but in a form that can be applied more clearly in the UK context.
The test will be published with clear routes of appeal, as a further layer of protection for any operators, including freight, that are subject to charges when using GBR infrastructure. When hearing appeals, the ORR will consider the extent to which GBR has appropriately considered all factors before levying a mark-up. I hope I have reassured the hon. Member for West Dorset that amendment 254 is unnecessary, as the Bill already achieves its intended effect.
Amendment 255 would give the ORR an explicit power, following an appeal against the content of a charging scheme, to direct Great British Railways to revise the scheme in cases where it considers GBR has not dealt fairly with the appellant. However, the amendment is not necessary to achieve that aim. The Bill already provides clear and robust rights of appeal to the ORR in relation to the content of a charging scheme. Those rights are supported by strong and effective remedies where an appeal against GBR is successful, as set out in clause 68.
In the system set out in the Bill, where the ORR upholds an appeal on the content of a charging scheme, it has the power to remit all or part of the provision appealed against to GBR for reconsideration. That means that the ORR can require GBR to make changes to the charging scheme if it was identified during the appeal process that GBR had acted in a discriminatory manner, inconsistently with its statutory duties or in a way deemed procedurally unfair.
The ORR can also give legally binding directions to GBR, which could include setting out what it failed to take account of in the original decision and what it must do to ensure that those matters are properly assessed when reconsidering it. The amendment would therefore introduce powers that are already provided for in clause 68. For those reasons, I urge the hon. Member not to press amendments 254 and 255 to a vote.
Rebecca Smith
Amendment 254 is good in so far as it goes in relation to rail freight, but other rail operators also provide public benefit and should receive a similar level of protection. The Opposition are happy to support the amendment, but we do not think it goes nearly far enough.
Amendment 255 would give the ORR the power to order GBR to revise a charging scheme if it found, on appeal, that GBR had not dealt fairly with the appellant. With the current constraint on appeals, the amendment would make no practical difference. The Government need to go much further by providing a genuine appeals process to assess appeals on their merits, with an independent body, not a direct competitor, taking the key charging decisions.
Keir Mather
I believe that hon. Members on both sides of the Committee have expressed all the points on these amendments, and I have nothing further to add at this stage.
Keir Mather
How can I top that? I am not going to try.
This group of amendments concerns performance schemes, which, as hon. Members are aware, are designed to improve the performance of the railway network by incentivising operators and infrastructure managers to enhance punctuality, reliability and overall service quality, underpinned by compensation, bonuses and penalties. For example, performance schemes can require operators to pay penalties if their services cause unplanned disruption, or can offer bonuses for better-than-planned performance.
The performance scheme provided for by clause 65 will apply to GBR itself, both in its capacity as a service operator and as the body responsible for maintaining the infrastructure. The clause supports one of the overall goals of the Bill: to dramatically improve service performance for passengers and freight operators, and to make a railway that really works.
I thank hon. Members for their amendments, which I will speak to in turn. Amendment 85 seeks to remove the provision that protects GBR for liability for performance scheme payments or penalties where the disruption is not its fault. To be clear, that provision is not designed to prevent GBR from ever paying penalties or compensation. Clause 65(2) clearly provides for GBR to pay penalties, compensation and bonuses. Where it is at fault for disruption, there is no question but that it must compensate other operators.
GBR will have the flexibility to design a bespoke performance scheme for its network. The Bill is intentionally broad, including at clause 65(3)(b), which does not define what constitutes disruption outside GBR’s control. Instead, GBR will consult the industry on its policy on the extent to which disruption after an unplanned event has occurred, and whether it is or is not outside GBR’s control. It will consider any legal requirements before publishing all agreed terms for transparency.
Edward Argar
The Minister says that GBR will be able to design a bespoke performance regime, but does that not go to the heart of what my hon. Friend the Member for South West Devon highlighted, which is essentially that it will be designing a performance regime against which its own performance will be managed? It gets to set the rules, determine what the parameters are, and then decide whether it meets those criteria. Subsection (7) says:
“A person aggrieved by provision contained in a scheme…may appeal to the ORR.”
Will the ORR have binding powers to make an adjudication, and will GBR be compelled to follow it?
Keir Mather
The right hon. Gentleman pre-empts my later comments about the role of the ORR in this process.
On the principle of whether GBR should be able to design a performance scheme for its own network, that is completely in keeping with the aspiration of the Bill to create a single uniting mind for the railway. We are cognisant of the fact that GBR has a threefold obligation in this process. First, it must create a scheme that it can use to deliver the efficiencies and operational realities of the railway in a way that suits the interests of the travelling public. Secondly, operators that use the service need to be able to ensure that they can have fair service under it. That is why consulting with the industry is so important.
Thirdly, and arguably most importantly, GBR must protect taxpayers’ interests where it is reasonable to do so. A scheme is being created that directs GBR to run the railway in a purposeful way but with robust consultation and enforcement mechanisms, which I will come to in a moment, embedded within it. I believe that strikes the right balance. We are giving GBR control over the system but not allowing it to mark its own homework in every way, as the Opposition might see it. I will go into that in more detail in a moment.
Rebecca Smith
To build on the point that my right hon. Friend the Member for Melton and Syston made, clause 65(3)(b) says that compensation may not be paid by Great British Railways
“in relation to any disruption that is outside its control.”
It strikes me that that relates to what the hon. Member for Birmingham Northfield said happens already: people have to decide what constitutes significant disruption, and what is inside its control. If I were an outside operator looking at this, I would be thinking, “Hang on a minute. Where’s the definition of what is inside GBR’s control?” There is a whole long list of options that I will not even begin to bore the Committee with for what could be said to be outside its control, but where is that conversation? It strikes me that it might be like trying to claim for a bag that was stolen on holiday on insurance—you have to literally prove that you were mugged to get reimbursed. I would be interested in a bit more information on how “outside its control” will be defined.
Keir Mather
That is why the point about designing the scheme in close consultation with industry partners is so important. The hon. Member has read my mind, as I am about to turn to specific instances or potential demarcations with respect to what does or does not constitute being within or outwith GBR’s control.
It is probably important to briefly explain what happens if an unforeseen situation arises and operators believe it is GBR’s fault but GBR disagrees, and the role of the ORR in that process. That brings us back to the intervention from the right hon. Member for Melton and Syston. The Bill will include in the future scheme a clear route to appeal, to protect all parties in instances that are disputed, but the risks will be mitigated by requirements for GBR to clearly publish the details of the performance scheme, including criteria for when GBR would be liable to pay compensation. That goes back to the public law point about transparency and fairness. The ORR, as the independent appeals body, will have a legal obligation to review the situation impartially and advise on appropriate action where necessary. In addition to the ORR, to further mitigate the risk, operators will be able to seek other means of resolution though the Access Disputes Committee where matters relate to a contractual dispute.
We believe that the clause is important, as there is a need to balance rightly protecting operators whose services have been disrupted with protecting taxpayer interest where it is reasonable to do so. For example, in instances of trespassing, we would not expect the exclusion in clause 65(3)(b) to apply, as the disruption that it causes should be within GBR’s gift to mitigate through investment in defences, and GBR would have significant opportunity to influence how quickly services are restored. In such an instance, therefore, we expect that compensation would be payable. However, where disruption follows events in extremis that are clearly not within GBR’s ability to mitigate against or control—for example, an act of terror—we envisage that the exclusion in clause 65(3)(b) might apply.
I reiterate that formulating the scheme in consultation with industry will allow us to flesh out in far greater detail the demarcations, and make sure that private sector operators and rail freight have the surety they need that the scheme has been designed in the right way. The ORR will play a key role in the process in ensuring fairness, acting as the independent appeals body if GBR does not act in line with its duties.
Amendment 223 seeks to ensure that third party operators do not face penalties for disruption outside their control. The Bill stipulates that only GBR is protected from paying penalties or compensation for disruption outside its control, because GBR is the only party that bears responsibility for the operation, maintenance and renewal of its network. There is no responsibility for that placed on third party operators, including freight.
On that basis, we do not see how the concerns raised by the hon. Member for South West Devon that a freight operator could face penalties for, say, infrastructure failures or planned engineering works would arise in practice, other than in extremely unusual circumstances —perhaps where an operator’s faulty train had caused damage to the infrastructure. Such events could only be the responsibility of GBR, as today they are not the responsibility of the infrastructure manager or the operator, so it is GBR that would pay the penalties for such issues.
It is right, therefore, that the Bill pursues a policy that protects the rights of third parties to reasonable compensation when disruption occurs as a result of another party’s actions or inactions, while also mitigating the risk of unjustified costs to the taxpayer when disruption is not reasonably in GBR’s gift to avoid or resolve. I hope the hon. Member will be reassured that the amendment is therefore unnecessary, as we believe the Bill already achieves the intended effect.
Amendment 86 would prevent the performance scheme set out in clause 65 from becoming operational until it has been laid before Parliament. Such provisions for parliamentary scrutiny are a well-trodden path at this stage of the Committee’s proceedings, and we again believe that the amendment would add unnecessary layers of bureaucracy to what is effectively a technical industry process. In reality, the expertise about what specific incentives should be set for different operators on different routes is within the rail industry, and those experts are the ones who need to review and help GBR to develop the performance scheme.
That is why the Bill includes requirements for GBR to consult on its performance scheme and requirements for what GBR must include and consider as part of its design, with clear rights to appeal to the ORR in the event of disputes. The amendment would add little practical value. It would delay the new access regime and the benefits it will bring to passengers.
Clause 65 requires GBR to provide for and publish a performance scheme that is designed to incentivise it, its subsidiaries and other train operators to minimise disruption to other train services and to the network itself. The scheme may include provisions for GBR and other operators to be required to pay penalties for causing disruption, receive compensation for disruption caused and receive bonuses that reward better-than-planned performance. The scheme may not provide for penalties or compensation when one train service causes disruption to another but they are both operated by the same person. The clause also prevents GBR from having to pay penalties or compensation in relation to disruption outside its control.
The clause gives GBR the power to require operators to provide information necessary for the scheme to function and offers no right to compensation or bonuses for parties that do not comply with those rules. The clause allows any person aggrieved by a provision in the scheme or any replacement or revision to it to appeal to the ORR. The clause is vital to create an efficient and reliable railway. It equips GBR to design a scheme that safeguards operators, forces accountability across the network and promotes continuous improvement. I therefore commend it to the Committee.
Question put, That the amendment be made.
Keir Mather
Clause 67 provides a route of appeal to the ORR for a person aggrieved by a GBR decision about access, capacity allocation and charging, including decisions made under those schemes. Clause 68 then sets out the principles for how appeals to the ORR will operate and empowers the ORR to issue a document setting out the detailed practice and procedure to be followed. Together the clauses establish the ORR’s reformed and independent appeals role, providing a clear, credible and accessible route of redress against GBR’s access and charging decisions.
Opposition Members have consistently raised the view that basing the appeals role on judicial review principles is not strong enough. However, the rationale for the ORR deciding appeals based on judicial review principles is simple: we do not want the ORR to opine on best use. That is GBR’s job and if the ORR could simply disagree with GBR because it had a different opinion, we would be leaving the system as it is today, with parallel decision makers and unclear accountability. We would not gain the benefits of a body that is truly in charge of rail. That is precisely how we ended up with mistakes like the recent 7 am Manchester service that was set to travel with no passengers on it. The ORR admitted it did not have the adequate information or resource needed to make an informed decision on the operation of that service. That is exactly why we need a consolidated directing mind for the industry that can take decisions confidently and with passengers and freight users at its heart.
Basing the appeals system on judicial review principles ensures that appeals are considered independently and on a recognised basis of fairness, legality and rationality, and without the fragmentation of decision making that plagues the current system. The appeals process will provide a robust accountability framework to ensure the railway delivers for passengers and freight customers. It is not judicial review principles that are weak; perhaps the hon. Member for South West Devon would suggest it is the powers available to the ORR to act on any wrongdoing that are flawed. I will turn to that next.
Edward Argar
Does the Minister not see the challenge that if GBR is the single directing mind, we need to ask how it is held to account for individual decisions that it makes? Where is its accountability to the public, be it through this place or others? Secondly, the Minister talks about judicial review principles. As constituency Members of Parliament, we all know just how high that judicial review bar is when people wish to challenge a planning decision, or something else. It cannot consider the individual merits of the decision, merely how it has been reached and whether due process has been followed. It is also incredibly costly. Is the Minister not concerned that in setting these principles, he is setting that bar at an unattainably high level, rather than striking the appropriate balance between being able to appeal and challenge something, but not unduly burdening the day-to-day decision making of the railways?
Keir Mather
I thank the right hon. Member for that contribution, because he gets to the nub of the principles. GBR will be held accountable through compliance with its duties as set out in legislation, which ensures that it has to have regard to passengers, including passengers with disabilities, and regard to the need to promote rail freight. It also has public law accountability built into it, through its legal obligation to act in a manner that is transparent and fair. The right hon. Member asks a broader question about whether the JR principles threshold is too high. We would argue it is not too high, precisely because of what it unlocks if we get to the stage where an appeal is upheld.
The ORR will have strong powers to dismiss the appeal or remit the decision to GBR for reconsideration, with legally binding directions that GBR cannot ignore. It is right and it is the stated principle both of the policy and of the overall notion of nationalisation that GBR can be a directing mind for the railway and have the power to do so, but there is a strong buttress against it if it is found that it has acted incorrectly as a matter of law.
Keir Mather
I will respond first to the hon. Member for Isle of Wight East. The point about confusion does not pertain to confusion created through arbitration in the courts on the principles of access decisions as a matter of law. I think that that is fundamental to making sure that GBR works within the boundaries of the legislative framework we have created, as well as, via public law principles, operating in a way that is both fair and transparent. The point about confusion is having two decision-making bodies on what constitutes best use of the network and access to the network. That is where we want to avoid confusion, because that is the system we have inherited, and it does not work for passengers.
The shadow Minister raised a point about fees, and the right hon. Member for Melton and Syston mentioned costs. Any appeals will be made against JR principles and not processes. It is not that each case will be brought before the courts, with the associated costs that that would bring, so I am confident that the costs of appeal would not be a significant factor under the new system as opposed to the old one.
On the matter of European systems, the shadow Minister tests the boundaries of my knowledge of the operation of rail systems overseas. There are systems in Europe in which a body similar to the ORR has too dominant a role in having charge over access and decision making in relation to it. That is not working in the existing system, and that is what we are trying to change through the Bill.
Amendments 88 and 89 seek to remove the requirement that appeals be made on judicial review principles and replace this with a requirement that appeals are determined
“on the facts and the law.”
As I set out in my opening speech, judicial review principles will ensure that the ORR focuses on the legality and fairness of GBR’s decision making, not on retaking the decision. Replacing this with a requirement to determine appeals on the facts and the law instead would convert this to a merits-based system, which would require the ORR to rerun strategic judgments and exercises on best use of the network. That is not the role we intend for the ORR. The framework is designed to provide strong, independent oversight while preserving GBR as the single directing mind.
We have discussed repeatedly in Committee that what is wrong with the railway today is the fact that there is no one decision maker. There has to be just one, or the railway will continue to stagnate. GBR is the body with the expertise to be that decision maker, and the ORR is the body that should check that it has acted fairly and proportionately. Judicial review principles strike the right balance between accountability and effective decision making.
Amendments 90 and 91 would extend the ORR’s powers to substitute its own decision for one of GBR’s. As I have mentioned, the Bill deliberately distinguishes between types of appeals and the powers available to the ORR in each circumstance. For appeals concerning provisions within GBR’s strategic documents, such as the access and use policy, infrastructure capacity plans or its charging and performance schemes, the ORR may remit the provision appealed against to GBR for reconsideration, and may do so with binding directions, but may not substitute its own decision. That is because these are not yes or no decisions—they are not simple decisions—but rather complex and comprehensive policies that govern the railway. It is not appropriate for the ORR to rewrite strategic policy documents, and that is not what regulators are meant to do. The ORR should be checking that GBR has acted consistently with its procedures and policies, not substituting them with its own.
However, for operational decisions, for example about charges for operators or about whether someone should be included in the timetable, the ORR has stronger powers. The ORR may quash all or part of the decision and may substitute its own decision in cases where there has been an error of law and, without the error, there would have been only one decision that Great British Railways could have reached. The amendments would remove these carefully drawn distinctions, potentially allowing the ORR to step beyond its oversight role and into decision making on best use of the network. We cannot have that. The amendments would allow the ORR to make decisions on best use without decisions going back to GBR to correct, removing GBR’s ability to learn from and correct its mistakes, and adding duplication between two decision-making bodies. The Bill already provides robust remedies where an appeal is upheld, including the power to remit with binding directions, even when substitution is not available, which ensures effective redress while preserving GBR as the single directing mind.
Amendments 92 and 93 would require the Secretary of State and the ORR to consult open access operators before publishing either regulations or practice and procedures for appeals under this chapter. The Bill already sets out a clear and proportionate consultation requirement, and the current formulation is deliberate to provide flexibility for the ORR to engage industry and stakeholders, including open access operators, without creating an inflexible statutory list. It may also be helpful to emphasise that the ORR’s appeals role exists precisely to ensure fairness, transparency and lawful decision making for operators, including open access operators.
The ORR has already begun engagement on its approach to developing its appeals process and has published a discussion document setting out its emerging thinking, which is publicly available and open to comment and views from industry and other stakeholders, including open access operators. The work is intended to inform its final appeals process, and there will be a formal consultation once the Bill receives Royal Assent. Open access operators will therefore be able to provide views as part of the consultation without the need for an explicit mention in the Bill. The process already provides a clear and appropriate route for open access operators to have their views heard.
I also note that the Secretary of State regulations relate to process matters only, such as steps that must be taken before an appeal is brought, time limits, and fees. They do not determine access rights or decision making on capacity allocation or charging. It is therefore appropriate that the statutory consultation requirement focuses on bodies with system-wide responsibilities and oversight roles, rather than individual categories of operator.
As with other consultation provisions in the Bill, singling out one category of operator will create a precedent for others to request to be added to the statutory list, and we will risk making the framework overly prescriptive. The current drafting already achieves the right balance, ensuring engagement and maintaining flexibility. For those reasons, I urge the hon. Member for South West Devon not to press the amendments, and commend clauses 67 and 68 to the Committee.
Question put and agreed to.
Clause 67 accordingly ordered to stand part of the Bill.
Clause 68
Appeal procedure
Amendment proposed: 88, in clause 68, page 38, line 11, leave out subsection (1).—(Rebecca Smith.)
This amendment removes the requirement that appeals may only be made under Judicial Review principles.
Question put, That the amendment be made.
Keir Mather
Amendments 203 to 205 seek to do two things: to remove the Secretary of State’s ability to make regulations relating to the appeals process; and to remove the Secretary of State, Scottish Ministers and Welsh Ministers as statutory consultees on the ORR’s appeals procedure. I support the ambition to ensure that the appeals framework works independently and commands confidence across the industry. However, the amendments are not necessary or appropriate to achieve that aim.
The ORR will establish its own appeals process and engage with industry on its development. In fact, it has already published a discussion document seeking views from interested parties on its policy choices. That was published on 3 December and can be found on the ORR’s website. The Secretary of State’s regulation-making powers are intended to provide a safeguard to ensure that the appeals framework operates effectively, and are not expected to play a routine role. The powers may be used only for matters of process—for example, the setting of legally binding time limits for bringing appeals and, if appropriate, providing for the charging of fees.
The powers cannot be used to interfere with the ORR’s independence in deciding and assessing individual appeals, or used to dictate the outcome of any appeal. Other procedural arrangements will be set by the ORR as it develops its appeals process. The power ensures that the framework can be set and adjusted, if required, to maintain effective operation over time while fully preserving the ORR’s independence in determining appeals. The Secretary of State will, of course, be required to consult the ORR, GBR, Scottish and Welsh Ministers and such other persons the Secretary of State considers appropriate before making any regulations under the power.
In a similar vein, when the ORR issues, revises or replaces its appeals practice and procedure, it is important that it must consult GBR, the Secretary of State, Scottish and Welsh Ministers and such other persons it considers appropriate. That ensures coherence across the railway network, particularly where services cross borders. Removing these provisions would reduce flexibility and resilience in the appeals framework without materially strengthening the independence of the ORR’s appeals role. For those reasons, I urge the hon. Member for West Dorset to withdraw the amendment, and not to move amendments 204 and 205.
Keir Mather
I beg to move amendment 175, in clause 69, page 39, line 25, leave out “17(1)” and insert “17”.
This amendment and amendment 176 restrict the power of the Office of Rail and Road to give directions to Great British Railways so that it will apply only to “facility to facility” access contracts.
The Chair
With this it will be convenient to discuss the following:
Government amendments 176 to 183.
Clause stand part.
Clause 70 stand part.
Amendment 146, in clause 71, page 40, line 30, leave out paragraph (a).
This amendment prevents regulations allowing for the early termination of access agreements.
Clause 71 stand part.
Government amendment 186.
New clause 67—Abolition of open access rights—
“Within twelve months beginning on the day on which this Act is passed, the Secretary of State must by regulations made by statutory instrument make provision to—
(a) prevent the granting or renewal of licences for open access passenger services;
(b) where such services cease to operate as a result of paragraph (a), require Great British Railways to operate equivalent services following their cessation.”
Keir Mather
Amendments 175 to 183 and 186 will ensure that GBR can enter into connection contracts with adjacent infrastructure managers and facility owners. A connection contract is a formal agreement that focuses on the physical interface and upkeep of the connection between two rail networks. Connection contracts are important in enabling the smooth passage of trains from GBR’s network to others, such as the Core Valley Lines in Wales. They also allow GBR’s network to be connected to privately owned depots or ports, which will be of importance to freight operators. These technical amendments retain the existing arrangements, enabling GBR and other parties to enter into connection contracts. I therefore urge the Committee to support them.
Edward Morello
I wish to speak in support of amendment 146 tabled by my hon. Friend the Member for Didcot and Wantage. Clause 71 gives the Secretary of State the power to make regulations allowing for the early termination of access agreements. We believe that this creates unnecessary uncertainty for train operators and passengers. Access agreements are detailed, regulated contracts that set out service patterns, responsibilities and costs. They are overseen by the ORR and published on its public register. Amendment 146 would remove ministerial powers to terminate those agreements early, limiting the ability of the Secretary of State to micro- manage GBR.
While I risk sounding like a broken record, as I have said before, these are powers that apply to both the current Government and future one. While I understand the desire for the Secretary of State to have the power to terminate agreements, those powers sit better with the ORR and GBR. If we want stability, investment and reliable services, we need to signal to the market that there will not be political intervention that undermines long-term planning. I hope that the Government will see the sense of this amendment.
Keir Mather
I thank the shadow Minister and others for their contributions. It is a small point, but the shadow Minister raised international obligations and treaties, and I want to reassure her that infrastructure managed and operated by parties other than GBR, including High Speed 1, will continue to be governed by the existing access and management regulation. There will therefore be no impact on international obligations and treaties. Hopefully, that will instil confidence throughout the rail supply chain as to how seriously we take those obligations.
I will speak first to clauses 69 and 70, before turning to the amendments. Clause 69 amends the Railways Act 1993 to exempt GBR from the ORR’s powers on access and its corresponding duties. In short, the clause prevents the ORR from making access decisions on infrastructure operated by GBR. Amendment of the existing provisions is vital to allow the Government to fulfil their commitment to establish GBR as the directing mind responsible and accountable for making best use of the railway. Retaining the role of the ORR as the decision maker on access is not the answer.
Under the current ORR system, decisions on the timetable are plagued by delays and disagreements between ORR and Network Rail, and require ministerial intervention for timetables to be finalised. As the regulator, the ORR does not have the ability to review the system holistically, create more routes and optimise the overall use of the network—it can only respond to the specific applications that are submitted to it.
If we keep the current system, we will continue to see disruption and delays caused by timetabling problems, and inefficient use of the network that is no one’s best interests. We will continue to see problems, such as trains running without passengers on them, purely because of the systematic issues that govern access and timetabling decisions. Retaining the ORR as the access decision maker would not lead to better performance, and would not benefit passengers. The only way to achieve the high-performing and high-quality railway that this country needs is to put one body—GBR—in charge of the railway and of granting access to it. It is only GBR—not Ministers or the ORR—that will have the level of expertise and the detailed knowledge of the whole railway system that is needed to make the right decisions for passengers, freight users and taxpayers.
Clause 70 makes technical changes to the body of law that currently governs access, to exempt GBR and make some other consequential changes, so that the existing access and management regulations will no longer apply to GBR in relation to its infrastructure. The technical amendments in the clause are necessary to enable GBR to become the single decision maker and directing mind for its infrastructure. The existing regulations will continue to apply for adjacent infrastructure managers, such as Transport for London and Core Valley Lines in south Wales.
Clause 71 provides the Secretary of State with a time-limited power to ensure that contracts can continue to operate effectively, following the establishment of Great British Railways. The Government have made the commitment that, following its establishment, the existing access rights held by operators, known as schedule 5 rights, will be honoured, as will the charges set by the ORR for the remainder of the current control period. The clause does not change those commitments. However, the power is needed to prevent contracts from becoming inoperable because they are reliant on the previous legislative framework in the Railways Act 1993, which will not be applicable once the Bill is enacted.
In a similar way to how the ORR provides notices for contracts today, the Secretary of State will, if necessary, and only as a last resort, use the power to make technical changes to existing contracts, simply to ensure smooth transition to the new access and charging regime under GBR—for example, to account for the establishment of GBR and address the changed roles of the ORR and GBR, so that contracts still operate as they should.
Without those changes, operators with access rights would potentially not be able to provide the services that they have contracts and rights to run, because the contracts will become inoperable. However, recognising the need for reassurance, and to offer certainty for third parties, the Government have also committed publicly to ensuring that operators with existing contracts in scope of needing that power will be engaged with and consulted, to identify inoperable clauses and agree on replacement wording.
Amendment 146 would take away the ability to amend or terminate contracts. However, it is necessary for the clause to be drafted widely, including with reference to termination, in case the best way to effect the technical changes to the contract is to terminate and immediately replace the contract with one that is aligned to the new legislative framework, rather than making numerous technical amendments throughout that would otherwise render the contract unusable or unwieldy. As stated earlier, that will not affect any operators’ schedule 5 rights, nor will it impede the existing charging determination set by the ORR until its natural expiry in April 2029, which the Government have confirmed both publicly and in writing. Not including that provision would be a risk to the smooth transition to the new regime, which the Government are not prepared to risk.
Given all that I have discussed, I urge hon. Members not to press the amendment to a vote.
Amendment 175 agreed to.
Amendments made: 176, in clause 69, page 39, line 26, leave out from “after” to end of line and insert—
“subsection (1) insert—
“(1A) Where the facility owner is Great British Railways, the Office of Rail and Road may give directions under subsection (1) only for the purpose specified in subsection (2)(e).”
See the explanatory statement for amendment 175.
Amendment 177, in clause 69, page 39, line 32, leave out—
“to which this section applies”
and insert—
“of the description specified in subsection (2)(e) unless one of the conditions in paragraphs (a) to (c) of subsection (1) is satisfied; and any such contract is void unless one of those conditions is satisfied.”
This amendment replaces the general restriction on Great British Railways entering into access contracts with one that will apply only to “facility to facility” access contracts.
Amendment 178, in clause 69, page 40, line 1, leave out subsection (4)(c).
This amendment removes the restriction on Great British Railways as a facility owner entering into installation access contracts.
Amendment 179, in clause 69, page 40, line 4, at end insert—
“(4A) In section 21 (model clauses for access contracts), after subsection (5) insert—
‘(6) The powers of the Office of Rail and Road under subsection (5) may not be exercised in relation to an access contract where the facility owner is Great British Railways unless the access contract is of the description specified in section 18(2)(e).’”
This amendment provides for the ORR’s model clauses powers to be exercisable in relation to access contracts entered into by GBR only where the access contract is a “facility to facility” access contract.
Amendment 180, in clause 69, page 40, line 6, leave out “if” and insert “where”.
This amendment and amendment 181 provide for ORR approval to be required for amendment of “facility to facility” access contracts entered into by Great British Railways.
Amendment 181, in clause 69, page 40, line 7, at end insert—
“unless the agreement is an access contract of the description specified in section 18(2)(e)”.
See the explanatory statement for amendment 180.
Amendment 182, in clause 69, page 40, leave out lines 10 to 12 and insert—
“(5A) Directions may not be given under this section in relation to an access agreement where the facility owner or installation owner is Great British Railways unless the agreement is an access contract of the description specified in section 18(2)(e).”
This amendment restricts the ORR’s power to give directions under section 22A of the Railways Act 1993 to the parties to an access agreement in line with the approach taken by the other amendments about access agreements.
Amendment 183, in clause 69, page 40, line 12, at end insert—
“(7) In section 22C (amendment: supplementary), after subsection (1) insert—
‘(1A) Directions may not be given under subsection (1) in relation to an access agreement where the facility owner or installation owner is Great British Railways unless the agreement is an access contract of the description specified in section 18(2)(e).’”—(Keir Mather.)
This amendment restricts the ORR’s power to give directions under section 22C of the Railways Act 1993 to the parties to an access agreement Great British Railways in line with the approach taken by the other amendments about access agreements.
The Chair
I propose that we suspend the meeting for 10 minutes so that everybody can have a comfort break.
Rebecca Smith
I think he probably would have said it, to be perfectly honest.
Clause 73 marks the end of a very significant chapter in the Bill, with many poorly drafted or simply ill thought through clauses. I am sure the drafting has been done with the greatest attention to detail; it is just the “thought-through-ness” that we are struggling with. But we end on a positive note, with no objections to clause 73.
Keir Mather
I am pleased to speak to this group of provisions, which concludes the scrutiny on the access chapters of the Bill.
Clause 72 provides the Secretary of State with the power to make regulations to amend the Railways (Access, Management and Licensing of Railway Undertakings) Regulations 2016 via the affirmative procedure. The access and management regulations are the existing body of secondary legislation that sets out the rights and obligations of infrastructure managers, train operators and the role of the ORR in relation to access, capacity allocation, access charges and performance. At present, those regulations can be amended only using powers under the Retained EU Law (Revocation and Reform) Act 2023, but those powers will expire on 23 June 2026, which means that, after that date, there will be no means other than an Act of Parliament by which those detailed and technical regulations can be amended.
Great British Railways infrastructure will not be subject to the regulations, as the Bill establishes a new access framework to enable GBR to be the directing mind, which we have discussed over the last few groups. However, alongside Great British Railways there will be a number of rail networks, such as Transport for London, London St Pancras Highspeed and the Core Valley Lines in Wales, that will continue to be subject to the access and management regulations. Those “adjacent infrastructure managers” will therefore not be part of GBR’s access regime. The purpose of the power in clause 72 is to ensure that the legislative framework governing the other infrastructure managers can be updated to address any inconsistencies between networks—to “keep pace” between the two different regulatory regimes. Without this power there may be disruption to the smooth passage of train services across different networks—which the Government have a duty to protect.
For example, the power might be used to secure alignment on the date when a new working timetable must come into effect. The access and management regulations currently stipulate a date in December, but given the risk of weather-related events, staff absences during the Christmas season and the engineering works that usually take place between Christmas and the new year, GBR will likely want to move away from that. If it did, it is not unreasonable to think that other infrastructure managers might want to follow suit to avoid being affected by the same risks and to ensure consistency in the timetable change date. To achieve that, it would be necessary to amend the regulations for the other infrastructure managers who wish to align with the date that GBR chooses in the future. The regulation-making power would enable that simple change to be made without needing an Act of Parliament.
There may also be opportunities for adjacent infrastructure managers to seek further simplifications to the current regulations in a way that meets our ambitions to reduce regulatory burden and support growth, while maintaining a sustainable and predictable framework so that businesses have confidence to plan and invest. The Government consider regulations, rather than primary legislation, as a better way in which to achieve that.
Regulations made under the clause must be subject to the affirmative procedure, ensuring full parliamentary scrutiny. Before exercising the power, the Secretary of State will consult all interested parties, ensuring full transparency, that industry has the chance to comment and that Parliament approves the regulations before any changes can be made. Amendments 256, 221 and 231 all seek to narrow that power in some way.
Amendment 256 would prevent the power from being used to direct operational matters of customer and facility owner freight sidings and terminals; amendment 231 would similarly exclude freight-only facilities. Those amendments are unnecessary, as the purpose of the power is to ensure alignment and remove inconsistencies in the regulatory regimes that will apply to GBR and non-GBR infrastructure and to enable simplifications where they align with the objectives of adjacent infrastructure managers.
Rebecca Smith
The Minister just said that the amendments are completely unnecessary, because the stated concerns are not real, effectively. That does not answer the very real concerns put forward time and again in the Transport Select Committee and in this Committee’s evidence session—the written and oral evidence—by businesses that are experts in the field. They are not reassured by the Bill as it stands. How can the Minister go back and say, “No, we’re right and you’re wrong,” to those experts in the industry?
Keir Mather
I thank the hon. Member for that intervention. I am not arguing that stakeholders are not valid in raising concerns about the issues: they are. I am seeking to ameliorate their concerns by outlining what provisions are in the legislation to offer sufficient scrutiny and ensure that the way in which the process happens offers robust safeguards.
Constraints are built into clause 72 to ensure sufficient oversight, with the Secretary of State consulting persons considered appropriate and making changes in secondary legislation that is subject to the affirmative procedure. That means that legislation will be subject to full public consultation and subsequently debated in both Houses, which reflects the importance of the regulations in providing certainty for business.
I have already said that the Secretary of State will consult all interested parties to ensure that there is full transparency and industry comment. Amendments 256, 221 and 231 would all narrow that power in some way. Amendment 256 would prevent the power from being used to direct operational matters of customer and facility owner freight sidings, and amendment 231 would exclude freight-only facilities. I have already spoken on why some of the principles that lie behind those amendments are unnecessary.
Let us take my example of GBR changing the date when its new working timetable is to take effect. On the basis of the amendments, other infrastructure managers would forever be misaligned with that new timetable change date, even if they wished to align. The Government do not intend to use the power to direct the owners or operators of private freight facilities on operational matters.
I am happy to reassure the Committee that the power cannot be used to bring other infrastructure managers or operators of privately funded facilities into public ownership, as I know how exercised Opposition Committee members have been about that principle. In the consultation, industry broadly supported the ability to make necessary amendments, although it is of course right to raise concerns when they arise. Most sector bodies agree that it will be important to ensure that there are no regulatory barriers to passenger and freight operators crossing between different networks, and that is what the clause seeks to achieve.
Amendment 221 would make the ORR and affected facility owners statutory consultees to the power. That is unnecessary as before exercising the power to make regulations, the Secretary of State is already required to consult all persons they consider appropriate, which would include the ORR and any affected facility owners. If the Secretary of State did not consult such persons, there would be strong grounds to challenge the regulations.
Clause 73 will ensure clarity in how key terms are applied throughout the access chapter of the Bill. It defines “GBR infrastructure”, “GBR passenger service” and “working timetable”—fundamental terms to the operation of GBR. The definition of GBR infrastructure ensures that the new access arrangements developed by GBR apply only where intended. The clause also includes a power to amend the definition, which is necessary to ensure that, as GBR’s network evolves over time, it remains clear to GBR and other infrastructure managers which parts of infrastructure are GBR’s responsibility. The clause is therefore critical to provide clarity and transparency.
Given what I have set out, I hope that hon. Members will not press their amendments. I commend clauses 72 and 73 to the Committee.
Edward Morello
I have nothing further to add, but we would like to press amendment 256 to a Division.
Question put, That the amendment be made.
Keir Mather
Me too, Mrs Hobhouse. Thank you for placing such confidence in me; we will see in due course if it is justified.
I thank the shadow Minister for speaking to amendment 222, which would require the ORR to monitor KPIs. My response will be brief, to avoid repeating myself, as the amendment is heavily linked to new clause 2, which we have already debated.
We expect GBR to have KPIs, as I have said before, but the right place for them is in GBR’s integrated business plan, alongside the detail of the activity that GBR will carry out over the five-year funding period. No sensible business would ever set its KPIs in stone, potentially for generations to come.
It is important that the ORR, in its role scrutinising GBR’s proposed business plans and monitoring its delivery of them, is able to assess whether commitments made by GBR are ambitious and realistic. As the independent expert adviser to the Secretary of State, the ORR will have a clear route to influence the formulation of GBR’s KPIs. By keeping them within the business plan, the ORR’s involvement is already ensured by legislation.
Amendment 97 would require the ORR to monitor whether GBR is implementing safety recommendations and standards set by industry bodies. I sympathise with the sentiments behind the amendment. Britain’s railways remain some of the safest in the world, which is why we are maintaining the roles of the statutory bodies in this area—the ORR and the Rail Accident Investigation Branch —and preserving the legal duty on all public bodies, including GBR, to give due regard to the investigation branch safety recommendations addressed to them.
Existing safety legislation already gives the ORR broad powers to monitor GBR’s safety management, including its implementation of investigation branch recommendations, and to take enforcement action if it finds that GBR is not managing safety effectively. The amendment risks confusing or duplicating well-understood roles and responsibilities in relation to the implementation, monitoring and enforcement of safety best practice. I hope I have reassured the hon. Member that this suggestion is already covered.
Amendments 99 to 101 would require the ORR to audit GBR’s statutory functions when undertaking its monitoring role. That is unnecessary, and would distort the clear and distinct roles set out in the Bill for both GBR and the ORR. The Bill retains the ORR’s important role as sector regulator and creates an enhanced monitoring function through which it will monitor GBR’s statutory functions and provide independent advice to the Secretary of State.
The ORR’s role as sector regulator is rightly separate to the role of an approved auditor. The annual accounts of GBR will be audited by the National Audit Office in the usual way. We do not propose to change that effective system, and cannot agree to an amendment that would layer it with unwarranted and inappropriate duplication, given that the ORR will already be monitoring GBR’s delivery of the KPIs within its business plan and GBR’s consideration of its duties when doing this.
Oversight of GBR will be proportionate, risk-based and focused on the outcomes that matter most to users of the railway, taxpayers and the wider public. The ORR will have a crucial part to play in providing this oversight, including by undertaking its enhanced monitoring role in the way it, as the independent regulator, considers appropriate. With that in mind, I urge the hon. Member not to press those amendments.
I commend clause 74 to the Committee. It will provide the ORR with enhanced monitoring powers, in line with its new role in the reformed sector. It will ensure that the ORR can effectively scrutinise GBR and provide independent expert advice for the Secretary of State for Transport and Scottish Ministers on its performance. As set out in the Bill, GBR will be required to produce an integrated business plan that demonstrates how it will deliver its priorities across the breadth of its statutory functions, including passenger services and the management of the GBR network.
Although GBR will report to the Secretary of State on the delivery of the plan, the ORR will be required to monitor the performance of GBR and independently advise the Secretary of State. The clause sets out that the ORR will monitor how GBR exercises its functions, including whether the commitments in GBR’s business plan are being met, how costs and income compare with estimates in that plan, and the extent to which GBR is ensuring safety on the railway. On an ongoing basis, the ORR will be able to escalate concerns to Ministers as it considers necessary, enabling the Secretary of State to make informed decisions in line with her responsibilities as funder of GBR. Given that the Secretary of State is democratically responsible for the billions of pounds of taxpayer subsidy invested in the railway, it is right that she has the final say on how it is used, with proper, comprehensive advice from an expert independent regulator to support her.
To fulfil its new role, the ORR must have the ability to gather information, conduct investigations, and assess whether GBR is fulfilling its statutory functions and business plan commitments. Clause 74 provides that statutory basis. It will allow the ORR, where it deems appropriate, to publish any information or advice it provides to the Secretary of State in connection with this monitoring function. That will ensure that the public can see how GBR is being held to account for its performance and how it is delivering in the interest of its customers, taxpayers and the public.
The policy rationale is clear: the Government are committed to preserving an independent expert adviser within the rail system and are providing the necessary tools for that body to operate and scrutinise GBR effectively. I commend the clause to the Committee.
Rebecca Smith
I have indicated that we want to press amendment 99 to a Division.
Question put, That the amendment be made.
Keir Mather
I beg to move amendment 271, in clause 75, page 43, line 23, at end insert—
“(2A) In section 55 (orders for securing compliance), after subsection (7C) insert—
‘(7D) The Office of Rail and Road may not, by a final or provisional order, require the payment of a sum by Great British Railways.’”
This amendment would ensure that the ORR may not impose a fine on GBR under an order to secure compliance with conditions etc, to align with the amendment to section 57A of the Railways Act 1993 made by clause 75(3) of the Bill.
The Chair
With this it will be convenient to discuss the following:
Amendment 212, in clause 75, page 43, line 24, leave out subsection (3).
This amendment removes the restriction on the ORR to impose fines on GBR for licence breaches.
Clause stand part.
Keir Mather
I will first speak to Government amendment 271 and clause 75 as drafted, which is essential to ensure that the accountability arrangements for GBR reflect its status as a publicly owned body, as well as enshrining the strategic role of Ministers.
The clause will make two changes to functions of the ORR that would otherwise apply to GBR. The first is to prevent the ORR from issuing specific directions to GBR relating to providing, improving or developing railway facilities, such as stations or depots. However, we expect that the GBR licence will include a condition relating to long-term asset management to ensure that the ORR retains oversight of infrastructure in the new system. As Members are aware, GBR’s licence will be subject to formal consultation.
The direction power was originally included to ensure that improvements were made when it is was clearly in the interests of the railway generally, but a railway operator might have no commercial incentive to make them. In the new system, GBR will be incentivised to improve its own infrastructure, and the change in legislation recognises that it is for Ministers, as funders, and GBR itself—not the regulator—to set the strategic direction for GBR.
GBR should then make decisions and improvements as part of its business planning, and the ORR should be able to monitor against the agreed business plan, supported by a licence condition that ensures that it can enforce long-term asset management in case anything goes wrong. If the ORR identifies a failing that constitutes a breach of that condition, and dialogue or early intervention have not proved effective, it will be able to escalate issues to the GBR board, require GBR to create and publish improvement plans and issue an enforcement order, which is a legal instruction that would require GBR to take action to meet its responsibilities.
The second change is to remove the ORR’s power to fine GBR. Imposing financial penalties on a public body would not align with the aims of maximising the benefits of public ownership. It would simply mean recycling public funds between two public bodies, continuing the money-go-round that is pervasive in today’s system. It would also add an administrative burden with only a limited effect on incentivising the right behaviours.
Amendment 271 is a technical amendment to ensure that when the Bill removes the ORR’s power to fine, it refers to all the correct parts of the law, including section 55 of the Railways Act 1993, to achieve that aim. The ORR will retain the ability to issue fines for breaches of licence conditions by non-GBR licence holders where that is an effective tool because those organisations will not be wholly funded by Government money. GBR can still be subject to a financial penalty if it violates health and safety or competition laws, as we are not changing the safety regime that will apply to the railways, and competition law will still apply in full to GBR. I look forward to hearing from hon. Members about amendment 212.
Rebecca Smith
Clause 75 prevents the ORR from issuing directions to GBR relating to providing, improving or developing railway facilities. It also prevents the ORR from imposing a fine on GBR for licence breaches. We think those are both terrible ideas.
The Transport Committee asked Maggie Simpson of the Rail Freight Group:
“What is your view on the ORR’s downgraded power merely to ‘advise’ the Secretary of State on GBR’s performance, rather than having actual powers of enforcement?”
She said:
“I am quite worried about this.”
To the same question, Steve Montgomery from First Rail said:
“Following on from that, the independence element of it—marking your own homework—is a big concern for us. How do we ensure that we do not see a perverse behaviour where GBR looks after its own operations to the detriment of others?”
Nick Brooks from ALLRAIL said:
“I can only echo that. With GBR writing the rules, controlling capacity and being linked to the main operator in the country, there is a structural conflict of interest, unless there is a clear duty of fairness and non-discrimination. I do not know of other European countries that do not have a strong independent rail regulator, across the EU and beyond. To be the judge and the jury at the same time is somewhat worrying.”
Emma Vogelmann, the co-chief executive of Transport for All, told the Transport Committee:
“Our recommendation on the role of the ORR is to retain its independent authority. We are definitely interested to see how that transition of powers, as Ben mentioned, plays out, and how enforceability plays into that.”
For once, the Government need to stop and listen. The sector is speaking with one voice and telling them that this is the wrong approach. The clause needs to be removed in its entirety. It is common for regulators to be able to issue financial penalties to private utility companies that are in breach of their statutory duties. Why should that consumer protection not also be applied to a public body like GBR? Removing clause 75 would restore the ORR as a strong, independent economic regulator.
Government amendment 271
“would ensure that the ORR may not impose a fine on GBR under an order to secure compliance with conditions etc, to align with the amendment to section 57A of the Railways Act 1993 made by clause 75(3) of the Bill.”
The Conservatives are against the whole clause, but, to save time, we will not seek a Division specifically on this amendment—I am sure that everybody will be pleased to hear that. However, as somebody who serves on the Transport Committee and sat through a lot of those evidence sessions, one of the key things that concerned me and some other members of the Committee was the breakdown of the relationship between the ORR and GBR and the weakening of the ORR’s powers. When I heard that evidence, I certainly felt that it was a compelling argument.
Liberal Democrat amendment 212 would remove the restriction on the ORR to impose fines on GBR for licence breaches. That is okay as far as it goes, and we will support the amendment, but we think that it does not quite go far enough. As I am sure Members expect on the basis of what I have just said, we will vote against clause 75 as a whole.
Keir Mather
I thank the hon. Member for Didcot and Wantage for his amendment, which would retain the ORR’s power to fine GBR in the event of a licence breach. He will be pleased to hear that I do not intend to repeat the arguments that I made in my opening remarks. However, as I suspect he knows, I cannot accept his amendment, because in creating the ability for the ORR to fine GBR, it would simply lead to the recycling of public funds, which he so ably outlined as being an issue.
On the subject of licence breaches, the ORR can issue an enforcement order to direct a different outcome from GBR. There is also a point to be made about accountability for GBR’s executives. That kind of relates to the penalties for Network Rail today: the ORR already recognises its public sector status and scales penalties accordingly. The chair and board of GBR will be responsible for ensuring that the CEO has in place robust performance management for senior staff, inherent to which will be not defying the ORR when it has issued legally binding directions. There will be a clear expectation that any significant failures will have a material impact on performance-related pay, and where the failure is sufficient to demand it, an individual should be at risk of dismissal. Put simply, removing the ORR’s power to fine will not cause the executive of GBR to be remiss in their duties.
Although the hon. Member asks me to speculate on potentially extreme cases where GBR could defy the ORR, I believe that, in the round, sufficient safeguards remain in place, with the ORR retaining its existing ability to issue mandatory and legally binding enforcement orders to GBR on matters within the licence; it is only the monetary aspect that is targeted here.
Amendment 271 agreed to.
Question put, That the clause, as amended, stand part of the Bill.
Keir Mather
Clause 76 updates the Office of Rail and Road’s information duties by inserting a new section into the Railways Act 1993 under which the ORR must proactively publish documents and information about key regulatory matters, including licences, access contracts, closures and railway administration orders, in whatever manner and form it considers appropriate. At the same time, the clause removes the ORR’s duty to maintain a formal statutory register under section 72 of the 1993 Act and repurposes that section so that it better reflects modern expectations of transparency, while retaining strong safeguards so that information that would seriously and prejudicially affect individuals, businesses or the wider public interest is not disclosed. The clause is not retrospective: it does not compel the ORR to publish historical material, but it allows it to publish information already held on the existing register where that is appropriate.
The main purpose of clause 77 is to replace the Secretary of State’s duty to keep a statutory register under section 73 of the 1993 Act with a focused duty to publish information, in keeping with the Government’s commitment to ensure appropriate levels of transparency on the railways. Clauses 78 and 79 do the same but for Scottish and Welsh Ministers.
These clauses retain strong protections for individuals, businesses and the wider public interest, making it clear that material that would seriously and prejudicially affect those interests must not be published. They allow Ministers to publish material currently held on the existing register, so that there is no gap in transparency during transition. The clauses deliver a modern, proportionate and more accessible publication regime, in keeping with the Government’s ambitions for a reformed railway.
Rebecca Smith
Clauses 76 to 79 change the current duties on the ORR, the Secretary of State and Scottish and Welsh Ministers to maintain a register, in sections 72 to 73B of the Railways Act 1993, and put them under duties to publish certain information. The ORR must publish documentation relating to licences; access agreements; access contracts, other than those using GBR infrastructure, for which GBR will be responsible; experimental passenger services; closures; and railway administration orders, except where that would affect individual public or commercial interests. The Secretary of State, Scottish Ministers and Welsh Ministers must publish determinations that a closure is a minor modification, and documentation relating to the enforcement of closure restrictions. Each clause contains restrictions about publishing information that would affect individual, public or commercial interests. Each clause also allows for the publication of documentation that was previously contained in the registers.
Clause 77, which is very similar to clause 76 and, indeed, clauses 78 and 79 on the devolved Ministers, amends section 73 of the 1993 Act, on the publication of a register by the Secretary of State, so that they are under duties to publish information—in particular, determinations that a closure is a minor modification and documentation relating to the enforcement of closure restrictions. However, proposed new section 73(5) of the 1993 Act is interesting. It states:
“The Secretary of State may not publish particular information or documents under this section if it appears to the Secretary of State that publication of that information or those documents would be against the public interest or the commercial interests of any person.”
Can the Minister outline under what circumstances not being transparent is not in the public interest? What determines public interest? I would be grateful to hear the methodology in this instance. Further, the only person with commercial interests in the railway will be the guiding hand of the Secretary of State herself, as it is all public money.
I am sure that proposed new subsection (5) is standard practice in statute, but it raises an interesting point about transparency that I ask the Government to spend some time thinking about. Public trust is low—perhaps it is even lower today than it was when my hon. Friend the Member for Broadland and Fakenham wrote this speech—and any part of any Bill that allows the Secretary of State to get away with not publishing information under a perceived public good would look most suspicious indeed. I do think that, in the light of yesterday’s events, my hon. Friend will see the irony in the words that he wrote there.
Clause 77(2) allows publication of anything that was in the register before the Bill’s commencement. What is the timeline for publication, and will the Minister commit to publication? Those queries aside, Members will be pleased to hear that we have tabled no amendments at this time.
Clause 78, which relates to publication of information by Scottish Ministers, mirrors clause 77. As I mentioned, it amends the 1993 Act, and aside from my query about the ability that it provides to not publish information against a perceived public good, we have no objections to the clause—unless it falls outside the devolution settlement, but presumably the Minister can reassure the Committee that it does not.
Clause 79 relates to the powers of Welsh Ministers, which are similar to those enjoyed by Scottish Ministers. The rationale behind allowing Ministers to not publish information over a perceived public good remains interesting to me, but I see no need to revise the clause.
Keir Mather
The intention of these changes is not to reduce transparency, but to modernise what is published and how. The new duty focuses on determinations under the Railways Act 2005 and the exercise of key enforcement and closure powers, which are among the most significant decisions the Secretary of State takes in relation to the railway. Other publication requirements—for example, on designations, directions and guidance, and the long-term rail strategy—are dealt with in other clauses, so the transparency framework should be viewed as a whole, not just through the lens of these changes to the 1993 Act.
The shadow Minister raised an important point about how commercial and public interest protections interact with freedom of information and scrutiny. The clauses preserve a carefully balanced approach that has long existed under the 1993 Act. This is not a wholesale change in how that process works. The Secretary of State must not publish material where it would be against the public interest or commercial interests, or where it would seriously and prejudicially affect individuals or particular bodies. Those protections sit alongside and do not displace the wider legal framework, including freedom of information legislation and parliamentary scrutiny, which of course continues to apply.
Question put and agreed to.
Clause 76 accordingly ordered to stand part of the Bill.
Clauses 77 to 79 ordered to stand part of the Bill.
Ordered, That further consideration be now adjourned. —(Nesil Caliskan.)
Railways Bill (Eleventh sitting)
Keir Mather Excerpts(3 days, 4 hours ago)
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Rebecca Smith
It is a privilege to work under your chairmanship, Mr Western. I start by conveying the apologies of my hon. Friend the Member for Broadland and Fakenham, who is not able to be present today. Instead, I am standing in on his behalf.
The clause sets out that Great British Railways must issue documents explaining the policies and procedures for access to and use of GBR infrastructure. Policy must cover procedures for applying for access, the criteria that GBR will apply to its decision making, and a procedure for resolving disputes. Subsection (3) permits GBR to set out the terms—that is, the rights and obligations —that a train operator can expect to receive where it has been granted access to GBR infrastructure. Subsection (6) allows a person aggrieved by a provision in the document to appeal to the Office of Rail and Road.
That is crucial information for all open access operators, and yet the Bill has no detail at all. It just makes reference to a future “document or documents”. In our view, that is a totally unacceptable approach, and it leaves the industry in the dark on mission-critical issues. Furthermore, no draft has been published, no direction of travel set out and no assurance given to the sector. We feel that to be a slightly arrogant approach from the Government and not a good sign of the approach that GBR itself will take to the independent sector.
Under the Bill as drafted, GBR can make the application process as one-sided as it likes, favouring its own services over those of other competing operators—in the interests not of passengers, but of GBR. The key issue is that the Government’s approach to the legislation is an assumption that the interests of GBR are synonymous with those of passengers, but we do not believe that that is always the case. Every organisation seeks to remove competition, which is uncomfortable—it exposes failures and weaknesses, and ultimately will show GBR up—but competition is crucial to improve service to customers, because organisations are forced to respond. That is why we believe that it needs to exist.
The Bill gives GBR the power to design out competition to itself, with no checks or balances save what we consider to be a pathetic appeals process, where the Government’s position is that the appellate body should not second-guess the decision of GBR, only errors of law. That is a core problem with the Bill and something that we feel is akin only to what a judicial review can do in other areas.
The clause gives GBR sweeping control over access rules, with very few safeguards. GBR sets both the access criteria and the timetable dispute procedure, so the body compiling the timetable also controls challenges to its own decisions. Subsection (3) makes the publication of access terms optional, allowing for opaque or preferential conditions. Subsection (4) lets GBR change the rules at any time, with no duty to consult. Overall, the clause lacks the transparency and checks promised in the consultation and risks embedding clear conflicts of interest to the disadvantage of non-GBR operators.
Lumo and Hull Trains, in their written evidence to the Select Committee on Transport, stated:
“Maintaining a fair, evidence-based, and independent process for access to the network is fundamental to ensuring continued growth and innovation.”
Under clause 59, however, the access and use policy will be developed and revised by GBR, setting the framework by which new services are assessed and defining the terms under which the ORR will judge appeals. Giving GBR exclusive control over that framework risks creating real or perceived conflicts of interest.
For more than two decades, the independence of access decisions has underpinned rail market growth. The continued involvement of the ORR in assessing applications objectively, balancing passenger, freight and performance needs, is essential to preserving that success. To ensure a transparent and fair access framework that the ORR can meaningfully enforce, it is important that private operators are involved in the development of the access and use policy and that appropriate statutory protections for open access are in place.
Without consultation or clear safeguards, the access and use policy risks becoming a document shaped solely by GBR’s priorities, which would potentially exclude private operators and leave them with no effective mechanism to challenge decisions that affect their ability to operate. A robust and independent access framework will also help to unlock further private sector investment in new services and rolling stock. By maintaining confidence in fair treatment and predictable regulation, the Government can encourage additional capital into the network, supporting the expansion of rail connectivity and the delivery of GBR’s passenger growth targets.
Freight operators currently benefit from statutory protections that recognise their environmental and national importance. Open access services deliver comparable benefits by driving modal shift, reducing emissions and supporting regional economies, and should therefore receive equivalent recommendation. They recommend that the Bill provide statutory protection for open access services, equivalent to that afforded to freight, and ensure that the ORR retains full authority to make access determinations independent of GBR. That would support the Government’s ambition for a network that is accountable, transparent and responsive to passenger demand.
I think that they are right. A core criticism of GBR is that it is a player and, now, the referee at the same time. Everyone must surely see that glaring conflict of interest. If His Majesty’s Government insist on changing the access and use policy to create a non-level playing field through the very tight capacity duty in clause 63, it should, at the very least, have an independent body responsible for applying the access and use policy. That is basic fairness in organisational structure.
We tabled amendment 76, which was not selected. We are not sure why, because it would ensure that the access and use policy would remain with the ORR by removing clause 59. That would mean sticking with the status quo and the existing access and use policy, avoiding the profound conflict of interest that clause 59 creates. If the Government decide to keep clause 59, which I assume they will, amendment 79 would enable a subsequent right of appeal to the ORR after going through the dispute resolution process. That would give open access operators a mechanism by which they could go to an independent regulator where necessary, giving them more assurance that they could survive in a new GBR world. That is a different point to the right of appeal under clause 59(6), which refers to the right to appeal the contents of a document. Amendment 79 requires a right of appeal to be included in the document itself.
Amendment 217 would place requirements on Great British Railways to use the access and use policy to promote high quality service or competition. At the very least, legislation needs to point GBR in the right direction so that other users can hold their decisions to account. The amendment gives such guidance. Without it, all that is left is clause 18, the general duties for GBR, and a bold reference to the public interest. It is inevitable that GBR will consider the public interest and the interests of GBR to be the same thing. The Government must think again on this, because the long-term damage to the wider rail sector will be profound.
Amendment 77 ensures that neither the Secretary of State nor Great British Railways could take any step to implement any part of the access and use policy until it has been laid before Parliament for three months. That ensures that we are not blindly creating law when we have not even seen important documents relating to how that law will work in practice.
Clause 66 lists the bodies that GBR will be required to consult before issuing its access and use documents: the ORR and Scottish and Welsh Ministers. That is it; they are the only ones that have that opportunity by right. There is no requirement to consult freight or other operators that might be affected. We think that that is an extraordinary approach. Amendment 87 addresses the shocking lack of consultation envisaged when GBR creates its crucial access and use policy documents by adding open access operators to the mandatory list.
The Parliamentary Under-Secretary of State for Transport (Keir Mather)
Good morning, Mr Western. It is once again a pleasure to serve under your chairship. I thank the hon. Member for South West Devon for these amendments, which all seek to make changes to GBR’s access and use policy.
First, I will provide a brief explanation of what the access and use policy sets out to do. It will set out a clear and consistent process for any operator seeking to run services on GBR’s network. It will therefore provide transparency and certainty for non-GBR operators—such as freight and open access—on the new policy and procedures they will need to engage with when seeking access to GBR’s infrastructure. It will be very similar in concept to the way the ORR publishes access processes and policies today. It will therefore follow a well-known path by which industry can engage with the access process, and like today, this engagement will be underpinned by legislation.
I can reassure hon. Members that the access and use policy is being developed in collaboration with industry. A discussion paper on the initial contents of the policy has already been published. It can be reviewed by hon. Members of this Committee and anyone else who wishes to contribute to its development.
I will turn to amendment 79, which seeks to add an appeals route to the working timetable after the dispute resolution process. I am delighted to start in a place of agreement with the hon. Member for South West Devon because the addition to clause 59 is, in fact, already in the Bill. The Bill provides, first, a mechanism for resolving disputes relating to the working timetable and, secondly, an appeals route to the ORR.
GBR will be required to set a dispute resolution procedure within its access and use policy for applications to be included in the timetable. That will allow parties to resolve disagreements collaboratively before escalation to the ORR, as detailed in clause 61(5). To be clear, the Bill already provides a subsequent route of appeal to the ORR for operators who have disputes over the working timetable. The amendment is therefore duplicative of that existing appeals route, and risks creating additional bureaucracy and confusion within the process. It would not improve the dispute resolution framework and, in our view, is redundant, but I am pleased that we have found at least one thing in these clauses on which the official Opposition and the Government can agree.
Amendment 217 would add requirements that GBR should use the access and use policy to promote high-quality service and competition. I cannot agree with this amendment. GBR’s duties under clause 18 cover the range of points that the hon. Member for South West Devon has suggested GBR must consider for its access and use policy. For example, I agree that GBR must promote a high-quality service, and this is already reflected in GBR’s duty to ‘‘promote high standards” of performance. We must remember that the clause 18 duties are the key decision-making criteria that GBR must apply at every stage—including when making its access and use policy—and so the requirement to drive towards a quality service is already embedded.
On competition, however, I must clarify that the Government support competition on the railways where it can add real value to passengers and farepayers. As the directing mind, GBR will be required to determine the best use of the network for all operators under a new and simpler legislative framework that ensures passengers and taxpayers are at the heart of decisions that are taken on the railways.
Where competition can support GBR in fulfilling its statutory duties—for example, to grow the economy and to provide improved choice and benefits to passengers —without undermining the vast investment made by taxpayers, we are supportive of the benefits of competition, and GBR must take those benefits into account. However, what the Government will not support is competition for competition’s sake. It is ideological and does not help us achieve the goal of making the railway work better.
The hon. Member for South West Devon seems to be equating promoting competition with fairness, but they are not one and the same. GBR must be fair to all third-party operators at all times. To ensure fairness for all parties, GBR will be bound by the Competition Act 1998, under which rules it cannot discriminate or abuse its dominant market position, and the ORR will continue to enforce this as the competition regulator. GBR does not need to actively promote competition to achieve that aim.
Amendment 77 would require GBR’s access and use policy to be laid before Parliament for three months before it can be implemented. GBR would be unable to implement any part of the access and use policy for a period of three months after it had been laid in Parliament. This would only result in delays for operators seeking to access the GBR network—a concept that is unlikely to be considered favourably by either open access or the freight industry.
The hon. Member for South West Devon should note that the access and use policy is a technical railway document. The purpose of this document is to provide a fair and transparent process for operators to apply for access. It sets out, for instance, the timings for applications, so that operators can prepare for the application window in advance. It also sets out what information applicants will need to supply and how applications will be assessed by GBR in accordance with its statutory duties. It is therefore right for GBR to develop it in consultation with industry and other railway bodies such as the ORR. This document should rightly be industry and expert-led. To reassure hon. Members about the content of the access and use policy, Network Rail has published a discussion document that sets out emerging thinking on a future access and use policy, with input from industry stakeholders. If Members of Parliament are keen to scrutinise the document, they are welcome to do so now, and I encourage them to engage with Network Rail’s external engagement process, or the usual processes in Parliament.
The industry has responded positively to the transparent and collaborative approach that has been taken in the development of the access and use policy. The freight sector has commented on how the discussion document acknowledges the key role of private investment. Network Rail’s engagement with industry will continue as the policy is developed, and there will be a further full consultation on the access and use policy with the ORR as a statutory consultee, which Members of Parliament are again welcome to contribute to.
Rebecca Smith
Something that the Minister said reflects back to what my hon. Friend the Member for Broadland and Fakenham said on Tuesday. Not putting private operators, open access and freight on this mandatory list is making us nervous that it is not the Government’s intention to keep involving them in the future. I appreciate what the Minister is saying about them being consulted at the moment, but this amendment is important because it would keep them as a fixture of the future of GBR, rather than as an optional extra, where they can be useful, but if they are not considered to add any value to the railway, they will not be there any more.
As we have already alluded to, industry certainty and assuredness needs to be there for private investment to come forward, some of which I know the Government will welcome. It is a bit of a chicken-and-egg situation: if we do not have them in the framework at the beginning, they are not being encouraged to stay involved and have that confidence. Does the Minister agree?
Keir Mather
The hon. Member is of course right to be wary about the involvement of open access in the railway, because although such provision forms a comparatively small proportion of railway journeys, we have discussed at length how certain access operator services provide great inter-city connections. There is of course a role for open access in the system being created by the Bill.
With GBR having regard to its duties when creating its access and use policy, it will have to factor in how users of the railway, both current and future, are able to make best use of services, whether they are provided by GBR or anybody else. Being bound by competition law, and the transparency and fairness inherent in it, will ensure that those that already provide services on the railway, and those that seek to provide services in the future, will have the opportunity to do so. I understand the hon. Member’s point about making sure that something is prescriptively listed in the Bill so that it is given due regard, but I would say that, whether through existing open access entitlements or the two rail freight targets that exist, there are sufficient assurances that there is scope for the inclusion of those services in the future of the railway, and that the access and use policy has to reflect that. I will turn to that in more detail soon.
All of the work on the access and use policy so far has happened without the need for a long and ever-expanding list of operators in the legislation, which would be the likely result of the amendment. If we name open access operators, we should presumably also list others, such as freight operators and devolved operators. Clause 66 currently requires that GBR must consult
“such other persons as it considers appropriate”,
and that formulation is deliberate; it ensures that consultation can be targeted, relevant and proportionate. Network Rail’s actions so far clearly demonstrate that open access operators are considered to be other appropriate persons in the reading of the clause, so both the reality and the future can be accounted for.
I reassure the hon. Member that there is no world in which GBR will create an access and use policy without consulting the relevant industry bodies that are affected. The amendment would add complexity, without delivering additional practical benefit. Although I thank the hon. Member for the amendments, for those reasons, I urge that she does not press them to a vote.
Clause 59 requires Great British Railways to publish an access and use policy. That key document will provide transparency and certainty for non-GBR operators, such as freight and open access, on the new policy and procedures they will need to engage with. For example, the policy will set out how operators should apply to access and use GBR tracks and infrastructure. It must set out the criteria Great British Railways intends to apply, in accordance with its statutory duties, when making access decisions, as well as its procedures for resolving competing demands and disputes. That will include, for instance, details on the economic and performance assessments GBR will undertake to determine best use. The policy must also include an explanation of how GBR will carry out maintenance and improvements to GBR infrastructure, and other necessary provisions, to ensure that the network works effectively. That exists in today’s system, within the industry network code, and we would expect GBR to draw on that when developing its policy on these key points.
The access and use policy is being developed in collaboration with industry. A discussion paper on initial content has already been published, and can be reviewed by the Committee or anyone else who wishes to input into its development. We hope that the extensive engagement being undertaken will ensure that a robust and effective document is produced that industry will be content with. However, as a backstop, any person aggrieved by a provision in this policy may appeal to the ORR.
Clause 66 will make it a legislative requirement that GBR must consult the ORR, the Scottish Ministers, the Welsh Ministers and such other persons as it considers appropriate before issuing, revising or replacing its access and use policy, which is dealt with in clause 59. That is in addition to GBR being a public body bound by public law principles. GBR must behave in a fair and transparent way, and therefore must consult interested parties, including rail freight and open access. The clause also ensures that GBR consults such persons as it considers appropriate before issuing, revising or replacing its infrastructure capacity plan, before issuing a working timetable and before making, revising or replacing a charging or performance scheme. Those issues are dealt with in clauses 60, 61 and 62.
Clause 66 is essential to provide reassurance to industry and our Scottish and Welsh counterparts that key parts of the new framework—GBR’s policies and processes—will not be designed in isolation, but will be underpinned by a transparent and consultative process. The clause provides the essential framework for collaborative and strategic planning by GBR across the rail network. I therefore commend clauses 59 and 66 to the Committee.
Rebecca Smith
I think I have said everything I want to say, but we would like to press amendment 79 and then amendment 217 to a vote.
Question put, That the amendment be made.
Keir Mather
It is my pleasure to speak to this long-awaited group of amendment to what are arguably some of the most critical aspects of the legislation. Clause 60 will require GBR to set out its proposal for the best use of its infrastructure, while clause 63 will require GBR to retain sufficient capacity to run its own passenger services and carry out engineering work.
First, I will explain how the Government have reached that conclusion. We are here because the current system for allocating capacity is clearly not working; it is designed so that each part of the railway acts and takes decisions in isolation. There was a four-year delay to the implementation of the new east coast main line timetable that was finally achieved in December 2025. Meanwhile, there is no single body with a clear vision for the best use of the network, and therefore no clear statement of the capacity that can be made available for different users of the railway. As a result, open access operators have expended considerable effort and resources in developing proposals for access to the network, many of which have ultimately been rejected by the ORR.
Both freight and open access operators would benefit from a single body empowered to provide that clarity about future opportunities for them to grow their presence on the railway. The only possible answer to fixing that is GBR, which can take decisions strategically, making the very best use of the limited capacity that we have. Only GBR can review the network holistically with a view to creating more space, which will benefit open access operators where they can show that their new services constitute best use of the network. That will benefit every hon. Member’s constituents, because there will be more opportunity for connectivity and more co-ordination to avoid disruption and delays.
In our new system, the process of allocating capacity starts with clause 60. The infrastructure capacity plan will set out GBR’s view of the best use of the network, showing how capacity can best be allocated between GBR’s own services, freight services and open access services. In creating that plan, GBR must have regard to the need to accommodate all types of services. The clause is one of the most crucial in the Bill, because it is where GBR—having consulted carefully with existing and prospective operators and other interested parties, and taken account of its statutory duties—will set out its view of the best use of the network. Once established, the plan will provide much-needed certainty for operators contemplating investment in new services.
I will be crystal clear for the benefit of the Committee: the capacity duty mentioned in clause 63 does not apply to the creation of the infrastructure capacity plan. Under clause 60, GBR will make its best-use assessment on the basis of the duties in clause 18 and other general duties in the Bill only. At this stage, it will not have any basis to refer to the duty as described in clause 63. It will take the decision fairly and transparently, in line with its duties, with the need to allocate paths for freight, open access and itself in mind.
There is absolutely no intention for other operators to be unfairly pushed out or disadvantaged by GBR. We want the best service for passengers, freight users and the public on every part of the route, to enable the best possible connectivity, quality of service and overall economic benefit. That is the goal, regardless of who provides those services. Were GBR to mistakenly apply the capacity duty at the capacity plan stage as part of its determination of best use, that would be grounds for appeal to the ORR.
Joe Robertson
I note the Minister’s assertion that there is no intention to squeeze out other operators, but given the way in which the Bill and the clause are drafted, that surely is an inevitability regardless of whether he intends for that to happen. It is the outcome that matters. If it will not enable open access and competition, that is in itself a problem, notwithstanding he might not intend that to be the case.
Keir Mather
I take fully on board the hon. Member’s point that we need to ensure services are not squeezed out. The process I am outlining is specifically to ensure that that does not happen. Where GBR has regard to its duties under clause 60 when deciding best use, it has to have regard to the freight target and the need to grow freight, but also the need to accommodate a range of services on the railway. That best use policy is locked in. It is under clause 63 that the capacity duty comes into effect, and GBR can make practical operational decisions about how to effectively actualise those proportions being allocated on the railway.
GBR will have to have regard to open access and freight under its duties in clause 60 when making the macro decision about what constitutes best use, which at the end of the day is not a binary yes or no question. The capacity duty in clause 63 merely ensures that it can provide the services it has been allocated. I will come to that in a bit more detail and set it out further. The hon. Member is welcome to intervene again if he feels my subsequent detail is insufficient.
On the capacity duty more broadly, the Government have been nothing but consistent. Put simply, the services that offer the genuine best value proposition for passengers, freight customers and the taxpayer, consistent with GBR’s duties, should be allocated capacity. Clause 63, meanwhile, creates a legal duty for Great British Railways to ensure there is enough space in the timetable to run the services funded by the Government and taxpayers. To reiterate, clause 63 is a requirement for space in the timetable. It is not a requirement for space in the capacity plan. It does not apply to the capacity plan and it therefore does not and cannot undermine the best use decisions taken at the capacity planning stage. That is because the Government are paying for certain GBR services and must not waste public funds. The clause 63 duty is about managing taxpayers’ money after best use has been determined. It is not about keeping anyone out.
Amendment 78 would require GBR to consult open access and freight operators in preparing the infrastructure capacity plan. Amendment 80 would require GBR to have regard to its key performance indicators when preparing the plan, and amendment 81 would amend clause 63 to require GBR to retain capacity for open access and freight operators. Amendments 253 and 229 would both give freight operators more weight in the capacity process.
Adding a further consultation requirement to clause 60 is unnecessary as there is already a separate requirement in clause 66 for GBR to consult affected operators when developing or amending the capacity plan. Were GBR to publish or amend a capacity plan at any point without consultation, that would constitute a breach of its duties under the Bill and present strong grounds for appeal to the ORR. Amendment 78 is therefore duplicative of the provisions already in the Bill.
As for amendments 80, 81, 253 and 229, the intended effect of clause 63 is to create a statutory duty for GBR to ensure that there is enough space in the timetable to run its own passenger services, which are funded directly by taxpayers. That is because taxpayers spend many billions of pounds subsidising the railway. Any responsible Government would be obligated to protect that investment and ensure that taxpayers get full value from it. The clause is therefore needed to ensure that where GBR considers its services constitute the best use of the network, and where it then allocates capacity to itself, it will actually run the trains that it is proposing to run and which it will be funded for. I do not believe anyone on this Committee would be delighted to find that, following GBR being paid several billion pounds to run services, it was unable to do so. Clause 63 is therefore an essential legal safeguard to prevent that from happening.
The interests of freight and open access operators are protected by GBR’s general duties under clause 18, and freight operators are further protected by the duty on GBR to have regard to the rail freight target set by the Secretary of State under clause 17. Those duties will apply when GBR establishes best use at the capacity planning stage for all operators, including freight. The existence of not just one but two statutory duties is a clear signal of this Government’s view that freight must be front and centre of GBR’s decision making. This will give freight much greater prominence in capacity planning and allocation decisions than the current system, in which capacity is too often allocated on a first come, first served basis without reference to any coherent view of the best overall use of available capacity. The clause 63 duty exists only to protect the Secretary of State’s investment in the railway; it is not intended to influence GBR’s capacity planning or to keep anyone out of the network. The amendments are therefore not compatible with the intended purpose of the clause.
Amendment 80 draws a link to the concept of key performance indicators. As I have set out in previous debates, the Government do not accept the need to make statutory provision about KPIs and so cannot support the proposed reference. As I have consistently said throughout these debates, KPIs should be in GBR’s business plan and not in legislation.
Amendment 211 would require GBR to publish a statement on any decision not to provide access on the basis of capacity. As a public body, GBR is bound by public law principles to behave in a transparent and non-discriminatory way. That means that GBR must set out its decisions transparently, including when granting access, with robust evidence that shows how it has acted in accordance with its duties, access and use policy and any guidance issued by the Secretary of State. If GBR failed to do that, it would be grounds for appeal to the ORR. The amendment is unnecessary because GBR is already required to transparently account for its access decisions, whatever the reason for them.
Finally, new clause 56 would require GBR to report on the merits of a centralised train planning and auctioning scheme, with high-yielding services being operated by private sector operators rather than GBR. This Government were elected with a clear mandate to return franchised passenger services to public ownership. Public ownership, with responsibility for passenger services and infrastructure brought together in a single organisation, is the only way to make the railway run better. It enables everybody to focus on a single set of objectives centred around the needs of railway users and the interests of the taxpayers who fund it, rather than shareholders and private profit. Public ownership of passenger services will save the taxpayer up to £150 million a year in fees to private operators alone. Therefore, GBR, rather than private operators, must be responsible for operating the services that taxpayers will fund it to deliver. Making GBR responsible for essential services also avoids the costs of maintaining a public sector operator of last resort function ready to step in if a private operator suffers financial failure or chooses to withdraw from operating the services.
While I fully support the provision of services by open access operators on the network where they add value and where there is capacity on the network, the model set out by the new clause is not compatible with the mandate that this Government were elected on: to bring franchised passenger services back into public ownership. It is not compatible with the regime set out in the Bill, which already provides clarity about the role of private sector operators and the opportunities for them to run services.
Given what I have set out, I hope that the hon. Member for South West Devon feels able to withdraw the amendments. I commend clauses 60 and 63 to the Committee.
Rebecca Smith
I have listened to the Minister’s comments. As I said earlier, we will not press amendment 80 to a vote, but I wish to press the others to a vote.
Question put, That the amendment be made.
The Chair
The rest of the amendments that we have just debated will be decided at the appropriate point.
Clause 61
The working timetable
Keir Mather
I beg to move amendment 174, in clause 61, page 34, line 38, at end insert—
“(4A) Agreement under subsection (4) may be general or specific, and the ways in which it may be given include it being given—
(a) in accordance with the terms set out as mentioned in section 59(3);
(b) by means of, or in accordance with, provision contained in an agreement or other document to which Great British Railways and the operator are parties.”
This amendment ensures that changes to the working timetable can be agreed in advance and in general terms, and sets out various of the ways in which agreement can be given.
The Chair
With this it will be convenient to discuss the following:
Clause stand part.
Clause 62 stand part.
New clause 52—Train frequency duty—
(1) The Secretary of State must undertake a public consultation on the frequency of Great British Rail services.
(2) The consultation under subsection (1) must consider the appropriate frequency of train services to ensure services meet local need.
(3) The Secretary of State must publish a report on the outcome of the consultation under subsection (1) within one year beginning on the day on which this Act is passed.
(4) The report under subsection (3) must—
(a) propose a frequency of rail services that will meet local need;
(b) include proposals for continuous engagement with local communities about the frequency of rail services for those communities.
(5) Before the end of the period of six months beginning on the day on which a report under subsection (3) is published, the Secretary of State must by regulations provide for a duty on Great British Railways to provide the frequency of train services as set out in that report (‘the duty’).
(6) Within one year following the making of regulations under subsection (5), and once per year thereafter, the Secretary of State must publish a report on—
(a) the extent to which Great British Rail has met the duty under such regulations;
(b) where the duty is not being met, any proposed changes to Great British Rail services to better allow the duty to be met.
(7) Regulations under this section are subject to the affirmative resolution procedure.”
This new clause would require the Secretary of State to undertake a public consultation and the regular reporting and monitoring of train frequency to ensure timetabling reflects the needs of local communities.
Keir Mather
Amendment 174 will provide greater clarity for all parties that the agreement GBR is obliged to have under clause 61(4) can be made in advance in a contract or other document between GBR and the operator in line with the terms set out in GBR’s access and use policy under clause 59(3). The amendment broadly replicates the current industry practice of making changes to the working timetable through contractual arrangements, so it is familiar to industry and was always the intended approach. I therefore urge the Committee to support the amendment, tabled by the Government in my name.
I thank the hon. Member for Epsom and Ewell (Helen Maguire) for tabling new clause 52, which would require the Secretary of State to publicly consult on and publish a report that recommends an appropriate train frequency that would meet local need and which GBR would then be obliged to deliver. Although this Government support the principle of designing a train service that meets passengers’ needs and local needs, the new clause would embed that responsibility in Government, and not with GBR. That would serve only to continue Government’s micro-management of the railways, under-mining GBR’s intended role as an empowered, directing mind that is enabled to take decisions on the best use of the network.
To take access decisions and plan its passenger services —which GBR will do in accordance with its duties, which are clearly defined in the Bill—GBR, and not the Department, must be able to design its own passenger train services. GBR will also be legally required to consult devolved Governments and mayoral strategic authorities before making certain decisions, such as service frequency decisions that will significant affect their local areas. The Government and GBR will also have to consult the new passenger watchdog when developing their policies, strategies and priorities for the railway, including when GBR is developing its business plan and passenger offer. The Secretary of State will set the long-term strategic objectives of the railway through the long-term rail strategy, which GBR will need to consider when taking decisions about service frequencies. The Secretary of State will also have to approve GBR’s integrated business plan, which will cover both track and train activity.
That framework represents the right balance between an empowered directing mind that can independently weigh up its duties in a considered and rational way when delivering its statutory functions, including developing the timetable, with appropriate consultation requirements and proportionate Government oversight. We do not want to continue the current system, under which stifling Government interference hampers the efficient running of the railways. I therefore urge members of the Committee not to move new clause 52.
Clause 61 requires GBR to issue a timetable that defines
“all planned train movements which will take place on GBR infrastructure during the period for which it is in force”.
Enabling GBR to establish a working timetable is fundamental to running trains safely and reliably at their published times. The current system cannot deliver significant timetable changes, even where there is a strong public interest case for doing so with significant taxpayer investment. That is because the process for revising the timetable is dependent on different organisations taking, at different points, different decisions that affect the timetable’s production. That creates complexity and challenges that can result in significant delays to the implementation of a new timetable being implemented and passengers and taxpayers losing out.
Despite the significant efforts made by Network Rail and the ORR, the new east coast main line timetable was delayed for over four years, which resulted in delayed benefits to passengers. Ultimately, until the current Rail Minister was appointed no one was willing to make a final timetabling decision. That cannot happen again: GBR must be empowered to take decisions or passengers and taxpayers will not see improvements.
Under clause 61, as the directing mind GBR will be responsible for taking decisions on timetabling in a process overseen by the ORR. A person whose application to be included in the timetable is rejected or who disagrees with the terms and conditions of their inclusion may appeal to the ORR. The clause ensures that GBR will deliver an achievable, reliable timetable that the network is able to deliver. Better co-ordination of the timetable and engineering works will reduce delays, improve reliability and reduce cost. GBR’s holistic review of the whole network can also improve connectivity for passengers. Without the clause, the current unacceptable system of timetable delays, disagreements and ministerial intervention will continue, which serves no one.
Clause 62 sets out the steps that GBR must follow before issuing a working timetable, as previously described in clause 61. It is a critical provision as a timetable is the backbone of a safe and efficient railway operation. Without a clear and structured timetable, trains cannot run reliably at their published times. GBR must invite applications for inclusion in the timetable from operators other than GBR’s own passenger services. The invitation must specify the period within which applications must be made and the information that must accompany an application. GBR must prepare and send a draft of the working timetable to those applicants. A person who has had an application rejected by GBR may appeal that decision to the ORR. The clause ensures that the process for developing the timetable is fair and transparent. I commend clauses 61 and 62 to the Committee.
Rebecca Smith
Clause 61(1) sets out that GBR must issue one or more timetables covering all train movements on GBR infrastructure for the period that GBR intends the timetable to cover, to be known as a working timetable. Subsection (3) allows GBR to alter a working timetable, for example to add new train movements, change a planned train movement, allow for maintenance works, deal with disruption, or change the duration of the timetable. Subsection (4) allows GBR to alter a planned train movement of an operator other than GBR only with that operator’s permission. Subsection (5) provides a right of appeal to the ORR for an operator who applied for a train movement to be included in the working timetable by GBR but was refused, or where the inclusion was made subject to conditions. The duty to consult and appeals provisions in clauses 66 to 68 also apply to the working timetable, but not to alterations of the working timetable.
Edward Morello (West Dorset) (LD)
It is a pleasure to speak under your chairship, Mr Western. I wanted to speak briefly in support of new clause 52, which, as the hon. Member for South West Devon indicated, was tabled by my hon. Friend the Member for Epsom and Ewell. It would introduce a duty on train frequency, which is something my constituents—and I am sure those of other Members—write about continuously. The new clause would require the Secretary of State to consult the public on how often GBR services should run, taking account of local need. It would then require the publication of a report, ongoing engagement with communities, and a binding duty on GBR to deliver the agreed frequency, with regular monitoring.
The new clause is designed to ensure that rural and less well-served areas are properly heard, and that timetables reflect how people actually use the railway and not just what is easiest to operate. If I were the shadow Minister, I would probably describe this as a probing new clause designed to draw out some secret piece of information. I heard what Minister said about it. All the other Liberal Democrat amendments have been designed to restrain the power of the Secretary of State and ensure that GBR is not micromanaged, and I think the new clause probably flies in the face of that. We will leave it there.
Keir Mather
I thank the hon. Members for South West Devon and for West Dorset for their contributions. I remain of the view that a unified system under GBR will plan and deliver an achievable, reliable timetable and ensure that the network is actually able to deliver it, so that the services promised to passengers are delivered. Better co-ordination of the timetable and engineering works will reduce delays, improve reliability and reduce costs, and through its role in issuing the timetable, GBR will be able to ensure that all services represent the best use of the network, with a strong appeals role for the ORR to ensure that fairness is embedded in the system. I therefore retain the view that the hon. Members should not move their amendments.
Amendment 174 agreed to.
Clause 61, as amended, ordered to stand part of the Bill.
Clause 62 ordered to stand part of the Bill.
Clause 63
Capacity duty
Amendment proposed: 81, in clause 63, page 35, line 34, leave out from “to” to the end of line 37 and insert—
“be satisfied that it retains sufficient capacity across GBR infrastructure to allow for—
(a) the operation of GBR passenger services, passenger services not operated by GBR and services for the carriage of goods by railway, and”.—(Rebecca Smith.)
This amendment aims to reduce the ability of GBR to prioritise its own operations where there are network capacity constraints and create a level playing field.
Question put, That the amendment be made.
Olly Glover
I have a few brief thoughts on what the Conservative spokesperson has said about this clause. On the Liberal Democrat Benches, we feel that a lot of the amendments ask good questions about transparency and about accountability for how the access charging regime will work. We are definitely interested to hear the Minister’s response.
A couple of the Opposition amendments perhaps go a little too far, or at least questions could be asked about them. Amendment 242, on what I am calling phantom paths, addresses an interesting phenomenon in the railway at the moment. Many freight paths are in the timetable, but seldom used; they are reserved by freight operators for a variety of reasons in case they might be used. People in the industry say that they sometimes present problems for optimum timetable development or use of capacity. It will be interesting to hear from both the Minister and, perhaps, the Conservative spokesperson as to how they feel that those phantom paths can be dealt with, absent an ability by GBR to apply access charges to trains that do not run.
Conservative amendment 83 attempts to remove GBR’s ability to charge higher than the normal rate, the likely revenue to be obtained by running train services does not vary significantly based on the type of railway and the type of service concerned. The most extreme example of that is that the typical fare yield for Manchester to Blackburn will obviously be a lot less than for London to Manchester. The concept of GBR applying differential access charges is not necessarily one that I would be inclined to oppose, but the criteria that it uses in doing so needs to be transparent. The amendments that we tabled earlier allude to that. It will be interesting to hear from the Minister how the Government intend for GBR to make that process transparent, particularly given the high judicial review bar for challenging some of those decisions. That way, hopefully, a new system can be created in which everyone might have faith.
Keir Mather
I will briefly turn back to the debate on the previous clauses; because the Opposition spokesperson asked me to provide an example of the motion of consent in general as it relates to timetabling and I was remiss in my duty in not doing so. To give more context, the network code currently sets out the circumstances where train service timings need to be adjusted by a few minutes without requiring specific consent. GBR will follow a very similar process and that is a normal process that industry would expect us to follow.
I now turn to the amendments at hand, all of which seek to make changes to GBR’s charging scheme. I confirm to the hon. Member for South West Devon that the charging regime broadly replicates the one that is in place today. That is intentional, so that all of the charges and discounts referenced will be familiar to industry to achieve a smooth transition to the new framework.
Furthermore, given that GBR will be bound by public law duties, which require fairness, reasonableness and non-discrimination in actions and decision making, there is no reason to think that GBR will behave unreasonably. Rather, when making or amending its charging scheme, GBR will be required to balance the various duties set out in clause 18, which include promoting the interests of passengers, promoting the use of the network for carrying freight and enabling operators to plan the future of their businesses. GBR will also be required to consult with industry through the development of its charging scheme, and will be held to account via a clear route to appeal to the ORR on the scheme’s design and application.
Given that existing competition law and applicable subsidy rules will automatically apply to GBR, GBR will not be able to treat other operators unfairly or start levying excessive charges that would undermine their ability to operate successful, profit-driven services. That will be further supported by the ORR’s continued role as competition regulator for the railway. I hope that gives hon. Members some assurance to begin with.
I now turn to amendment 242, which proposes to remove the provision at clause 64(1)(b) that enables GBR to charge operators for services that do not run as planned. In today’s system, that mechanism is called a reservation charge, and the Bill replicates that for GBR. Importantly, the Bill does not mandate that a reservation charge must be issued in all instances where services do not run. Instead, GBR will have discretion regarding how and when to use it. That is particularly important for taking into consideration different industry operating models, especially freight, which is market driven and therefore has to live with less certainty over the services that it needs to run to serve its customers.
A routine and technical example of when a reservation charge is used today, and likely to be replicated in the future, is one affecting passenger services, not freight. Where a passenger service is allocated to a path that is expected to stop at eight stations but—for reasons of its own making and not GBR’s—it terminates short of its final destination and stops at only seven, it could still be charged as planned for the full service. In addition, with finite capacity on the network it is important that, when passenger operators are granted access, they provide those services they said they were going to run and are disincentivised to simply hold on to capacity.
To use a different example, if an operator consistently failed to run a service in its entirety, it would disadvantage passengers seeking to use that train and other operators that might wish to operate a passenger or freight service on an unused path. It could therefore be charged in full. As I have outlined, the purpose of the measure is to encourage operators to use the capacity that they have been allocated. Therefore, the ability to levy a reservation charge is an extremely useful tool to drive the right behaviours on the network. It ensures that best use is made of capacity and that operators remain accountable for providing the services in the timetable that they agreed to deliver.
Railways Bill (Tenth sitting)
Keir Mather Excerpts(5 days, 4 hours ago)
Public Bill CommitteesRead Full debate Read Hansard Text Read Debate Ministerial Extracts
The Chair
I hear the Committee made very good progress this morning. I am sure you will share my ambition to get through part 2 this afternoon, but that will depend very much on how much progress we make. The official stop is 5 pm but if we have to go over, we have to go over. I also intend to have a comfort break at a convenient point.
Clause 34 ordered to stand part of the Bill.
Clause 35
Interpretation of Chapter 1 of Part 2
Question proposed, That the clause stand part of the Bill.
The Parliamentary Under-Secretary of State for Transport (Keir Mather)
It is a pleasure to serve yet again under your chairship, Mrs Hobhouse. Clause 35 provides definitions for key terms used in chapter 1 of part 2, ensuring clarity and consistency in interpretation. I commend the clause to the Committee.
Jerome Mayhew (Broadland and Fakenham) (Con)
I agree.
Question put and agreed to.
Clause 35 accordingly ordered to stand part of the Bill.
Clause 36
General duties of the Council
Daniel Francis
If the hon. Gentleman looks at the clauses in the group, he will see that there are significant issues that the passengers’ council needs to take into account for all passengers, which come to the door and—as I know, having sat on a watchdog for four years—come in the form of casework and meetings. I am sure that I will talk later about why nationalisation, and having trains, signals and rolling stock under one operator, is much better for a passengers’ council, but those issues come to the organisation’s attention anyway.
I fully support the need to look at the issues for disabled passengers who come to the council’s door, and I will hear what the Minister has to say, but I believe that how things are investigated and brought to the organisation’s attention are set out in the legislation, just as they are, in many regards, for Transport Focus and for the London Transport Users Committee. I do not believe that the amendment is necessary.
Keir Mather
I thank the hon. Member for Broadland and Fakenham for these amendments, but also right hon. and hon. Members across the Committee for their contributions on this important point.
The right hon. Member for Melton and Syston is correct that I intend to argue that the passenger watchdog will focus inherently on the needs of passengers. I believe that that is self-actualising, to an extent, in creating one in the first place. But he is also right to push me further on specific provisions.
My hon. Friend the Member for Bexleyheath and Crayford made some really important points, first about the fact that the duties and responsibilities inherent to the passenger watchdog demonstrate how it will serve the interests of passengers. Having an independent monitoring power for the passenger experience, investigation powers, enforcing minimum consumer standards—this is inherent to representing passengers on the railway.
Jerome Mayhew
The Minister has come up with an ingenious argument, but if he takes the trouble of actually reading the opening sentence of clause 36, he will find that it says, under “General duties”:
“When exercising its functions relating to railways and railway services”—
So, arguments about buses and other modes of transport are clearly outside the scope of this clause, are they not?
Keir Mather
But they are not outside the scope of the passenger watchdog as a whole. We would not want to be prescriptive in one place, only for us not to be able to make the passenger watchdog agile and adaptive in dealing with the needs of other modes. There could be unforeseen issues in which the passenger watchdog will need to represent passengers, or new developments, for instance those arising from new technology, where we would want the council to be able to advocate for passengers in the future.
The Bill already gives the council a purpose: via a combination of the functions and duties set out in the Bill and the Railways Act 2005, the council’s purpose and railways functions are set out sufficiently and are rightly broad.
Amendment 64 replaces the passenger watchdog’s duty to make efficient use of funds with a duty to consider value for money through a cost-benefit analysis. The revised duty being suggested by the shadow Minister and the duty in the Bill are to all intents and purposes the same. The watchdog will need to conduct some form of analysis to ensure it is making efficient use of funds when deciding which issues to investigate. Therefore, the amendment is duplicative and in my view unnecessary. With all this in mind, I urge the shadow Minister not to press these amendments.
Clause 36 places two general duties on the watchdog, which it must consider when carrying out its rail functions. The first is a duty to consider the interests and needs of disabled persons, which is designed to ensure that the watchdog will pay specific attention to the experiences of disabled passengers. The second is a duty to consider the costs and efficient use of public funds when it exercises its rail functions, which will ensure that the watchdog takes the overall cost of the railway into account when carrying out its functions—for example, when advising GBR or the Government. This will ensure that its recommendations are realistic and actionable, and therefore carry more weight in the industry. These duties will enable the watchdog to be an effective passenger champion, with the needs of disabled people at the heart of its priorities.
Jerome Mayhew
You will not be totally amazed to learn, Mrs Hobhouse, that I am not persuaded by the position that the Minister has taken. The obfuscation, chucking in other modes of transport when that is clearly excluded by the wording of the clause, does not persuade me and I wish to press both amendments to a vote.
Question put, That the amendment be made.
Edward Morello
I will speak in support of amendments 208 and 209, tabled in the name of my hon. Friend the Member for Didcot and Wantage. Amendment 208 would guarantee representation for rail passenger groups within the passengers’ council. In West Dorset, we are fortunate to have active and committed groups such as the Salisbury to Exeter rail user group and the west Dorset western area transport action group—they do have snappier acronyms. These organisations bring together passengers, MPs, councils and local communities to push for better services, improved stations, more resilient timetables and new trains. They lobby operators, Network Rail, the Department for Transport and others. They understand in detail what is working and what could be done better. Groups like these exist all over the country and their expertise and insight should be embedded in the passenger watchdog from the start.
Amendment 209 would strengthen that further by removing the vague caveat that representation should be included only
“so far as it appears expedient”.
The Bill promises a powerful new passenger champion that sets standards, investigates poor performance, and holds operators and GBR to account. We envisage that amendments 208 and 209 would do exactly that. I hope the Government will see the logic of supporting them.
Keir Mather
I thank the hon. Members for Didcot and Wantage and for Broadland and Fakenham for tabling these amendments, and the hon. Member for West Dorset for speaking to them. They seek to make changes to the governance and obligations of the passenger watchdog.
I will turn to amendments 208 and 209, which seek to ensure that rail passenger groups are represented within the passenger watchdog. The passengers’ council currently operates under the name Transport Focus and is led by a board of non-executive directors, including members for Scotland, Wales and London. These are statutory appointments as defined in the Railways Act 2005, and we are not amending those arrangements via the Bill.
Although we are not mandating specific representation of rail passenger groups on the board, the watchdog is a body that represents passengers, just like other rail passenger groups, and will directly engage with them. As mentioned, to ensure that happens, the Bill already requires that the watchdog must consult anyone who it thinks is appropriate and co-operate with other bodies representing the interests of passengers, including other rail passenger groups.
Amendment 209 seeks to delete the words
“so far as it appears expedient”
from the watchdog’s requirement to keep matters under review. Although the watchdog will be a powerful champion and will have resources to reflect that, we must ensure that it can focus its time and resources on the matters that have the most impact on passengers and prioritise its work as it sees appropriate. Without that caveat, it would be required to keep all matters affecting passengers under review, no matter how minor or trivial, which is not a reasonable duty to place on the watchdog.
Amendment 65 would set a deadline of one month for the Secretary of State and GBR to respond to any representations made by the passenger watchdog under clause 37. I agree with the hon. Member for Broadland and Fakenham that it is important for representations from the watchdog to be responded to efficiently, but more complex issues raised by it need careful consideration. Setting a uniform deadline could have the effect of rushing that consideration, which might not lead to the best outcomes for passengers. In fact, allowing more time to consider representations would increase the chances of actions being taken that might require a commitment of funding, so I do not think that such a deadline necessarily serves passengers. Additionally, having a duty to respond within a time period in the Bill that would be enforceable only through the courts could result in issues taking much longer to resolve. I therefore urge the hon. Member not to press the amendment.
Finally, amendment 235 would require the passenger watchdog to assess and report on passenger satisfaction at least once a year. Assessing passenger satisfaction is currently a well-established practice of the passengers’ council, which operates under the name Transport Focus, and that will not change with its transition into the new passenger watchdog. Transport Focus has a long record of collecting passenger feedback in the form of its rail user survey.
In addition, a new rail customer experience survey has recently been introduced. This is an industry-wide survey of customers’ experiences. It provides a crucial insight into rail customers’ experience, supporting the industry to achieve a better understanding of where it does well, where improvement is needed and what elements of the journey matter most to passengers. New survey data is provided every four weeks and the passenger watchdog will have access to the raw survey data to enable it to carry out its own independent analysis of the results.
The watchdog will publish its own analysis on a regular basis, as Transport Focus does currently, in the form of rail operator scorecards—including a GBR scorecard—that will be found on their websites and that will demonstrate to passengers which operators are performing well on passenger matters and which are not. Given Transport Focus’ long-established role in assessing rail passenger satisfaction, and the introduction of the new rail customer experience survey, I believe continuous monitoring of passenger experience is well established without this amendment. I therefore urge the hon. Member not to press the amendment.
The Chair
We are now slightly out of sync because the Minister has responded before the shadow Minister could make the case. I remind Members to bob after I put the question, even if the amendment itself is not mentioned when I put the question. I know it is slightly difficult. I will call the shadow Minister, then the Minister will respond very briefly.
Jerome Mayhew
No wonder I agree with it so strongly. I put “LD” by it, but that is being unduly generous to the Liberal Democrats. It is an excellent amendment. As I was concluding, it would ensure greater transparency and, therefore, a better service from this organisation, so I have no hesitation in supporting amendment 235 and I hope that the Liberal Democrats join me in doing so.
Keir Mather
The Committee will be glad to hear that I do not intend to re-rehearse the argument that I pre-emptively set out in response to the amendments. On the broader point made by the hon. Member for Broadland and Fakenham about the passenger watchdog and its capabilities, I am of the view that having independent monitoring powers for the passenger experience, having investigation powers, having the ability to demand information by a deadline, enforcing an independent dispute resolution service, and making sure that minimum consumer standards are protected with the ability to escalate to the ORR for enforcement is a suite of measures that will allow the watchdog to fully account for the passenger experience. That relates both to this clause and ones that I am sure we will arrive at in short order. On that basis, I urge the hon. Member for West Dorset to withdraw his amendment.
Edward Morello
I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 36 ordered to stand part of the Bill.
Clause 37
Keeping matters under review and collecting information
Amendment proposed: 65, in clause 37, page 20, line 14, at end insert—
“(3) When the Passengers’ Council makes representations under this section, either to the Secretary of State or Great British Railways, they are both under a duty to respond to those representations within the period of one month.”—(Jerome Mayhew.)
This amendment would require the Secretary of State and Great British Railways to respond to any representations the Passengers’ Council makes under this section.
Question put, That the amendment be made.
Keir Mather
I am pleased to speak to clauses 37 and 38 relating to the passenger watchdog’s duty to keep matters under review and its power to collect information. Clause 37 ensures that the passenger watchdog proactively monitors any matters affecting passengers, whether they relate to passenger services or stations. It also requires the watchdog to consult relevant people and to co-operate with other bodies that represent passengers, such as London TravelWatch. Clause 37 also gives the watchdog the power to collect information so it can effectively monitor the passenger experience.
The clause will ensure that the watchdog is proactive and has a good overview of any emerging issues that may impact passengers. It will also ensure that the watchdog engages and co-operates with relevant bodies and seeks information to effectively address potential issues with the passenger experience. I hope hon. Members will agree that that power is fundamental to the effectiveness of the watchdog as a passenger champion.
Finally, clause 38 will enable the passenger watchdog to enter into agreements with other public bodies so that, if necessary, they can perform the functions under clause 37 instead of the watchdog itself. The Secretary of State’s consent is required before entering into agreements under the clause. The clause replicates section 76A of the Railways Act 1993, which we wish to retain for cases where another body could keep certain passenger matters under review more effectively than the watchdog. That could, for example, happen in a certain geographical area where there is an effective devolved body with specialised local knowledge. The clause supports the watchdog to operate as an effective passenger champion by ensuring that it can flexibly co-operate with local bodies to the overall benefit of passengers.
Jerome Mayhew
The hon. Member is absolutely right that there is a sequence of complaint. Before going to an external body, one would typically be expected to have exhausted the internal complaints procedure of the organisation against which one is complaining. It would be perfectly reasonable for the passenger watchdog’s first questions to be, “Have you complained to GBR? If so, what did it say?” In fact, that might be its working definition of frivolousness: going straight to the watchdog without having made a complaint.
I warn the Minister that the current wording is an open chequebook. It could lead to a huge amount of work for an organisation that is not currently set up to deal with it, and which would require significant funds from somewhere to do so. What assessment of demand has been undertaken for council investigation powers? What budget has been earmarked for the huge increase in workload? Transport Focus, the host organisation, currently has fewer than 30 staff—I speak from memory and stand to be corrected, but when I visited there were something like 22 staff. To what size does the Minister anticipate expanding Transport Focus or the new passenger watchdog?
Amendment 142 would make GBR the first stage of a complaint submitted, with the passenger standards council as the appellant body should the complaint not be satisfied by the response from Great British Railways. I doubt whether it needs an amendment to primary legislation, but it would be the right sequence for any complainant to exhaust the in-house complaints procedure first. Does the Minister not mean the passengers’ council to have the authority to pick and choose its investigations? If he does not, he should stick with the current wording; if he does, he should think again.
Keir Mather
The shadow Minister asked about the interaction between Transport Focus and London TravelWatch in instances in which cross-border services might need active deliberation between the two organisations. They currently operate under a memorandum of understanding, and I understand that they are planning to update it when the Bill becomes more mature, which will allow them to develop a consistent framework for dealing with cross-border issues. Where a case is under investigation and is fully within the London railway area, it falls within the remit of London TravelWatch: rightly, the passenger watchdog must refer the case to London TravelWatch as the independent expert on travel in the London area.
The shadow Minister also asked some operational questions about the passenger watchdog’s budgetary planning and the size of its staff. Those matters will be actively developed later in the process, once we have set the legislative foundation for the organisation to be created.
The shadow Minister made a fair point about the principle of investigation, but intensive investigations are one thing, and the ability to have regard to complaints that are not vexatious is quite another.
Jerome Mayhew
That is all very well, but it is not the wording of the Bill. The text does not say “have regard to”; it is a mandatory requirement to investigate every single allegation. I totally understand where the Minister says he is coming from, but unfortunately his Bill does not agree with him.
Keir Mather
My point is that the shadow Minister’s interpretation of the term “investigation” might diverge slightly from mine in respect of what we expect the passenger watchdog to do in relation to each individual complaint that it may receive, and especially to those that are vexatious or frivolous.
On the broader point, I thank the hon. Member for Didcot and Wantage for his amendment, which would require the passenger watchdog to wait until GBR has considered an issue before investigating it itself. He is right to point out that individual passenger complaints should go to operators, including GBR, in the first instance. If the passenger is unable to get a satisfactory resolution to their complaint, they can raise the issue with the watchdog through the service provided by the rail ombudsman for independent dispute resolution. As the amendment suggests, that is a very sensible process.
However, there are times when the watchdog will need to investigate issues before or instead of operators. For example, if an issue falls outside the scope of the ombudsman service, or if the issue is systemic and persistent and cannot be appropriately dealt with by a single operator, the watchdog may decide to open its own investigation.
We expect the watchdog to actively investigate a wide range of issues beyond individual passenger complaints and GBR services. They could include systemic or cross-industry issues in the provision of passenger assistance, such as the issues that we have unfortunately seen on the railway in the past, or persistent issues with punctuality, open access or devolved services. The amendment is therefore not appropriate, as it would unnecessarily restrict the watchdog’s ability to act freely on behalf of the passenger. I do not support restricting in legislation which issues the watchdog can investigate.
Jerome Mayhew
I recognise that the Minister has his line to take and that there will be lots of angry people sitting behind him at tea time if he makes any concessions. However, a simple amendment to the wording of the mandatory requirement in clause 39(1), paragraphs (a) to (e), would give the passenger watchdog the ability to pick and choose. Changing “or” to “and” at the end of paragraph (d), before
“it appears to the Council that the matter is one that the Council ought to investigate”,
would surely provide the flexibility that everyone probably thinks is necessary.
Keir Mather
I will happily let the shadow Minister intervene again, because I would like to seek clarity on how inserting “and” would allow the watchdog to choose whether it has to investigate something in the first instance.
Jerome Mayhew
In the wording of clause 39(1), at the moment paragraphs (a) to (e) are additional. If the “or” in
“or…it appears to the Council”
at the end of paragraph (d) were replaced with “and”, there would be a two-part test. The council would receive complaints from all the kinds of people in paragraphs (a) to (d), and the second part of the test would be that
“it appears to the Council that the matter is one that the Council ought to investigate.”
That would give agency to the council to monitor and choose the most important things for it to investigate.
The Chair
I remind the Minister that this is not part of the amendment that has been proposed. Could he therefore wind up? The shadow Minister is welcome to table a new amendment, but his proposal is not relevant to this afternoon’s discussion.
Keir Mather
I thank the shadow Minister for his contribution. Perhaps, in slower time, he can walk me through each specific provision and we can come to a determination as to the intent that he outlined, but for the moment—at your discretion, Mrs Hobhouse—I will proceed with the matter at hand.
I do not support restricting in legislation which issues the watchdog can investigate. The watchdog will already be working closely with GBR to ensure that GBR can respond to its own passenger issues effectively and according to best practice and will not duplicate investigations unless it is necessary to do so. I therefore urge the hon. Member for Didcot and Wantage to withdraw amendment 142.
Clause 39 will enable the passenger watchdog to investigate matters relating to railway passenger services or station services. The clause places a duty on the watchdog to conduct investigations in certain circumstances. For example, the watchdog must investigate any matters referred to it by passengers, potential passengers or organisations representing passengers provided that the matters are not vexatious. It must also investigate any issues referred to it by the Secretary of State, Scottish and Welsh Ministers or the ORR, and anything that it appears to the watchdog that it ought to investigate.
If the matters fall wholly within the London railway area, the passenger watchdog must refer it to the London Transport Users Committee. Transport Focus, the body out of which the watchdog will be built, has a duty to investigate matters referred to it, but the clause expands the list of people who may refer cases for investigation, to reflect the central role of the watchdog, its role in the reformed railway and the importance of passenger experience to this Government.
Olly Glover
I hear what the Minister says. I still think that the logical wording of the clause could be ameliorated, but I shall leave that to the Government and spare the Committee a Division. I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 39 ordered to stand part of the Bill.
Clause 40
Power to obtain information
Keir Mather
I turn first to the shadow Minister’s point about either diffusing enforcement capabilities between the ORR and the passenger watchdog or seeking to double them up as part of legislation that is designed to rationalise and simplify notions of accountability and enforcement within the railway. Under the system outlined in the Bill, the ORR can use the findings of the watchdog; the watchdog just has to make its own assessment of the materials given to it by the ORR. In my view, that does not constitute the same thing as reinvestigating a matter. The intention is for the ORR to be made aware of the passenger watchdog’s work at every step toward referral by the watchdog itself. There is therefore a low risk of the ORR having to retake steps, given that it is actively consulted as that process unfolds.
I will now speak directly to amendment 66 and clauses 40 and 41. As the shadow Minister has outlined, amendment 66 would give the passenger watchdog enforcement powers when its requests for information were not met. The Government are creating a strong passenger watchdog that will have powers to monitor passenger experience, and to hold GBR and others to account. Although it will not have full enforcement powers, it will be able to demand information from operators to a deadline, investigate problems, demand improvement plans and refer cases for enforcement action to the ORR. It is important to have one clear enforcement body for the entire sector to avoid duplication or confusion for industry. If there were two bodies with enforcement powers, the risk of conflicting enforcement steers creating additional bureaucracy would be too high.
The ORR will therefore enforce GBR’s new streamlined licence, ensuring that the organisation meets its industry obligations and all minimum standards, including passenger standards. As it does today, the ORR will enforce all other railway licences to ensure that there is an independent, consistent enforcement body for the sector. We expect our licence proposals to include a condition requiring operators to co-operate with the passenger watchdog. That will help to ensure that other licensed operators co-operate with requests from the watchdog. That type of provision is typically found in operator licences. For example, there is a similar requirement for operators to co-operate with Transport Focus today. For those reasons, the amendment is not necessary.
Turning to clauses 40 and 41, clause 40 gives the passenger watchdog the power to request the necessary information to effectively carry out investigations into issues affecting passengers. That information could be requested from train or station operators including, of course, GBR. The information must be provided to the watchdog within a reasonable timeframe, unless the person did not have, or could not reasonably obtain, the information. If the watchdog did not receive a satisfactory response to its information request, it could refer the matter to the ORR, which will continue to act as the enforcement body for the rail sector. The watchdog’s power to request information from operators to a deadline is a new one, demonstrating the Government’s commitment to a strong passenger champion that can make an impact on the railway. That will ensure that the watchdog can carry out its investigations effectively and in a timely manner.
Clause 41 protects any information where the person who provided the information has requested that it be held in confidence. That will ensure that confidential or sensitive information is not published or disclosed by the watchdog, with some sensible exceptions such as ensuring that the watchdog can refer the matter to the ORR for enforcement and that relevant law is complied with. Clause 41 also ensures that information held by a rail operator that may help an investigation but is sensitive or confidential—due to its commercial nature, for example—will not be published in any investigation reports. That will encourage operators to share information and ensure that the watchdog can carry out any investigation effectively while protecting confidential information.
Jerome Mayhew
The Minister’s argument is clearly—is it parliamentary to say nonsense? I hope it is. His argument, that the industry will be confused if the passengers’ council is able to enforce its own deliberations, is ridiculous; he just has to think about it. The ORR has its areas of competence on which it enforces, and the passengers’ council has its areas of competence; they are discrete. Where confusion might really arise is if the passengers’ council thinks it is trying to get information and is stymied by the ORR taking a different view, which is the position the Minister has put forward. I have no hesitation in pushing the amendment to a vote.
Question put, That the amendment be made.
Jerome Mayhew
The amendments relate to clause 42, so I will explain what that clause seeks to achieve. Its title is “Representations and referrals”, and its focus is on introducing a power so that
“the Passengers’ Council may make representations to such persons as it thinks appropriate for the purpose”,
such as train or station operators, to resolve a matter under investigation.
If the passengers’ council believes that an operator
“is contravening, or likely to contravene”
its licence obligations, it must either engage with the operator directly, as we will discuss further when we consider clause 47, and/or refer the matter to the ORR and notify the Secretary of State. There are various other things that clause 42 does, but those are the main things.
The clause makes it clear that even after a passengers’ council investigation has identified a licence breach, the ORR retains complete discretion on whether or not to act. Once again, that will create a two-stage process in which the council must refer breaches that it cannot resolve itself, but the body receiving the referral is not obliged to act on it, or to intervene. Therefore, the watchdog investigates, but only the ORR can enforce, which it can choose not to do. That structure falls way short of the supposed strengthened passenger accountability model described by Ministers, and it serves only to risk causing prolonged delays for passengers who face ongoing harm, to the extent that a licence provision is breached, without a guaranteed remedy.
Thus far, we have not seen a clear rationale as to why the Government would create a watchdog only for it not to have any enforcement powers. It prompts the question: “What’s the point?” Evidence to the Transport Committee was very clear—the passengers’ council needs to have enforcement powers of its own to do the job envisaged for it. At the very least, if the ORR is to remain the enforcement body, there should not be a weeding process between the decisions of the passengers’ council and the ORR; the ORR should at least get on and enforce. That is what amendments 67 and 68 would achieve, by requiring the ORR to take action when a contravention had been referred to it.
Keir Mather
I thank the hon. Member for the amendments, which would require the ORR to take action in the event of a referral from the passenger watchdog.
First, I will point out that enforcement actions by the ORR are not the only way in which problems can be solved. The Bill gives the watchdog the power to request improvement plans, to allow operators to explain their planned improvements and agree them with the watchdog before issues are referred to the ORR for potential enforcement action. That is likely to be a faster way to get improvements for passengers than going straight to enforcement action.
I appreciate the intention behind the amendments, which is to ensure that the watchdog will be listened to; it is an intention that the Government support. However, it is also important that the ORR, as the sector regulator, is able to take a broader view before deciding whether enforcement action is appropriate. That is because the passenger watchdog is only a passenger champion—it has a sole focus—and, by comparison, the ORR is the regulator for the whole sector and has to take into account a wide range of matters. If that were not the case, enforcement decisions could be taken that were good for the passenger but had a negative impact on the network as a whole. Each time that the ORR makes a decision, it must transparently explain its rationale to the watchdog on that basis. Therefore, in our view these amendments are unnecessary and I urge the hon. Member to withdraw them.
Clause 42 will give the passenger watchdog the power to:
“make representations to such persons as it thinks appropriate”,
in order to resolve a matter under investigation. If the watchdog believes that an operator is currently
“contravening, or likely to contravene”
its licence obligations, it must either engage with the operator directly to request an improvement plan or refer the matter to the ORR and inform the Secretary of State that it has done so.
If the case is referred to the ORR, the ORR can choose whether to take enforcement action or not. It must then inform the watchdog and the Secretary of State of its decision. That will ensure that the watchdog can act independently to resolve problems through engagement with operators and by directly engaging with the ORR when necessary. Without clause 42, the watchdog would not be able to effectively resolve matters that it had investigated and follow up on them. I commend the clause to the Committee.
Jerome Mayhew
I am not persuaded by the Minister. There are two amendments. In order to save time, I will press the first one to a Division, and the outcome of that will determine whether or not I press the second one to a Division.
Question put, That the amendment be made.
Jerome Mayhew
Under clause 43, the passengers’ council can prepare, send and publish a report of its findings in an investigation, but it must obtain the Secretary of State’s consent before sending or publishing a report if the investigation was undertaken following a referral. Similar provisions exist for the Scottish and Welsh Ministers. The wording of subsection (3) makes publication discretionary even after a full investigation and subsection (4) requires ministerial consent before publishing any report arising from a referral.
As the explanatory notes confirm, that structure gives Ministers an effective veto over publication. Why should the Minister have a veto over publication when the organisation being investigated is their own creation? If the state has created a toothless investigation watchdog body that, despite its lack of enforcement powers, has managed to do an investigation, write a report that is no doubt critical of the state, GBR or perhaps even the Secretary of State and the Department for Transport, the Secretary of State, or the Scottish or Welsh Minister can, for whatever reason they like, veto its publication. They can muzzle the watchdog at whim.
That risks undermining the whole process—where is the transparency?—and weakens the credibility of the new watchdog. If the aim is to strengthen passenger oversight, investigation reports should be published as a matter of course, with only narrowly defined exemptions for confidentiality or commercial reasons. Transport for All explains in its written evidence to the Transport Committee how that will affect passengers:
“Clauses 42-47 empower the Passengers’ Council to receive complaints, investigate issues, and identify potential breaches of licence conditions. However, the Council has no power to compel corrective action, issue penalties, or enforce compliance. If it identifies significant accessibility failings, it must refer the matter to the ORR, which retains full discretion over whether to investigate or take enforcement action.
Disabled passengers already face disproportionate obstacles when raising complaints, and this indirect model appears to add another layer of bureaucracy without increasing accountability. We worry that it will create further delays, weaken enforcement, confuse passengers, and result in inconsistent redress. A watchdog without enforcement powers is fundamentally limited in its capacity to protect passengers’ rights or drive accessibility improvements.”
Amendment 69 requires the passengers’ council to publish any report on a matter investigated under clause 39. That will create greater transparency and accountability in the new watchdog. Frankly, if the Government are serious about supporting the rights of passengers, rather than designing in an ability to hide embarrassing conclusions, they must support this amendment.
Amendment 70 would require the passengers’ council to publish its report within six months of completing the investigation. Having in statute a specific timeframe in which a report must be published would create a sense of urgency, or at least of purpose, and a culture would develop within the organisation that placed high importance on those reports—exactly as it should.
Amendments 138, tabled in the name of the Liberal Democrats—presumably the hon. Member for Didcot and Wantage—would require the passenger’s council to prepare a report of findings after an investigation and ensure that any report is laid before Parliament. It is another attempt to strengthen the reporting requirements from a different angle and should be supported because it is seeking to achieve a similar outcome to my own amendments.
Amendment 140, also in the name of the hon. Member,
“removes the requirement that the Passengers’ Council must obtain the Secretary of State’s consent before sending or publishing a report if the investigation resulted from a referral by the Secretary of State”.
Amendment 69 is a mandatory requirement that they must publish every report. If that is not acceptable to the Government for whatever reason, then amendment 140 is a slight variation on the theme in that it takes the discretion away from the Secretary of State and leaves it where it properly lies, if there is to be discretion: with the passenger watchdog. That body, surely, having undertaken the investigation, written the report and come to a conclusion, are best placed to decide whether it is in the public interest to publish, not the owner of the nationalised industry that is being investigated.
Keir Mather
I thank hon. Members for these amendments, which all relate to the passenger watchdog’s investigation reports. I will begin with amendments 138 and 69, which both require the watchdog to publish its investigation reports. Amendment 138 also requires the watchdog to lay the reports before Parliament.
First, I would like to reassure the Committee that the passenger watchdog will routinely publish reports of all its investigations. The watchdog also has an obligation under the Railways Act 2005 to prepare a report of its activities at the end of each financial year, which the Secretary of State must lay before Parliament. That obligation will remain unchanged and will ensure there is transparency and parliamentary scrutiny around the watchdog’s activities.
However, it is worth saying that, for matters referred to it by the Government and the ORR, there must be an opportunity for the referees to review the watchdog’s findings and consider next steps before reports are published. The watchdog’s investigations may also uncover issues that need to be kept confidential, for instance commercially sensitive issues that should not be shared publicly. For those reasons, I do not support the amendments. The existing transparency and security requirements on the watchdog are comprehensive enough to ensure that the public and Parliament have access to investigation results and general reporting without compromising sensitive information.
I thank the hon. Member for Broadland and Fakenham for amendment 70, which would require the passenger watchdog to publish reports of its investigations within six months of completing them. Although we would expect the watchdog to publish reports of all investigations within a reasonable timeframe, it is important that it has some discretion. The watchdog’s investigation may uncover issues that need to be considered carefully and some investigations will naturally be more complex and time-consuming than others, for example investigations into persistent cross-industry issues involving multiple operators and regions.
Transport Focus has raised concerns that setting a deadline may force it to hasten or reduce the scope of investigations, which is not in the passenger’s interest. Transport Focus also has arrangements in place to raise urgent issues with operators, which would continue, so it can act quickly to solve problems for passengers in parallel with investigations if needed. In some cases, reports may benefit from being shared in draft, with time allowed for those impacted to consider improvements. The watchdog should have the flexibility, in that instance, to seek the best outcome for passengers. For those reasons, I do not support a statutory requirement to publish all investigation reports to a six-month deadline.
I thank the hon. Member for West Dorset for amendment 140, which proposes to remove the requirement for the Scottish or Welsh Ministers or the Secretary of State to consent to the publication of an investigation report on issues that they referred to the watchdog. Clause 43 is intended to ensure that Ministers have an opportunity to review the investigation report on matters they have referred to the council before the report is published. That is especially important where the matter under investigation is sensitive and needs some discretion to raise issues carefully and privately, as that may be the best and quickest way to get action for passengers. One example would be issues relating to availability of funding, where Ministers will need to weigh that up carefully against other priorities.
For those reasons, I do not support removing the requirement for ministerial consent before the council sends or publishes a report of an investigation resulting from a referral by the Secretary of State or by Scottish or Welsh Ministers. We are not expecting Ministers to refuse consent to publication, but the clause is a necessary safeguard to protect confidential information, to allow issues to be weighed up carefully and to ensure that problems are fixed for passengers as swiftly as possible. I urge the hon. Member to withdraw the amendment.
Finally, clause 43 will enable the passenger watchdog to prepare, share and publish reports of its investigation findings. As I have already set out to the Committee, the watchdog must obtain the Secretary of State’s consent before sending or publishing a report if the investigation was undertaken following a referral from the Secretary of State. Similar provision is in place if the investigation has been undertaken following a referral from Scottish or Welsh Ministers. If the investigation was undertaken following a referral from the ORR, the watchdog must inform the ORR before publishing a report of its findings. The clause will ensure that findings of the investigations are transparent and available to the public and Parliament, so that train operators, including GBR, can be held to account for the way they are treating passengers.
Keir Mather
With your permission, Mrs Hobhouse, I will speak to the clauses now and address the new clause once I have heard the shadow Minister’s remarks.
Clauses 44 and 45 relate to complaints and dispute resolution. Clause 44 designates the passenger watchdog as the body that will deal with complaints about potential infringements to retained EU law on rail passenger rights. Retained EU law on rail passenger rights includes requirements on operators to provide travel information to passengers and assistance to passengers who need it to travel.
Transport Focus is currently the body designated to receive complaints about potential infringements to retained EU law on rail passenger rights. The Bill consolidates the existing regulation to ensure that Transport Focus retains that role when it becomes the passenger watchdog. The clause therefore replaces the existing regulations on this matter. That will ensure that operators are held to the same, or indeed higher, standards for passenger experience, and that there is still a body clearly responsible for monitoring and addressing such complaints.
Cause 45 places a duty on the passenger watchdog to provide an independent alternative dispute resolution service to users and potential users of train and station services. The watchdog will take over sponsorship of the Rail Ombudsman from the ORR to fulfil that duty, ensuring that the watchdog provides an independent service to rail passengers that can handle disputes between passengers and service operators fairly and impartially.
Transferring the sponsorship of the Rail Ombudsman to the passenger watchdog will provide an effective independent service that has the appropriate third-party accreditation. That includes ombudsman status, which gives it the power to require remedial action from operators on passenger complaints that it upholds. The clause will ensure that the watchdog has the legal obligation to continue to provide an alternative dispute resolution service, even after the existing contract with the Rail Ombudsman expires in 2028.
Jerome Mayhew
I have nothing to add on clause 44. Clause 45 provides a duty for the passengers’ council to secure independent dispute resolution arrangements. As the Minister just said, it is anticipated—according to the explanatory notes, at least—that it will take over sponsorship of the Rail Ombudsman from the ORR in order to fulfil that duty.
I want to ask the Minister what powers the dispute resolution function will have, because the Bill and the explanatory notes are entirely silent. That is the modus operandi that we have become used to during the course of these Bill proceedings: there is endless putting off, and the detail has not been thought out—or, certainly, not shared. This seems to be a similar case.
New clause 46, in my name, would ensure that the Office of Rail and Road continued to publish data on complaints in the same manner as it currently does. During a significant transition such as the creation of GBR, it is crucial that data collection and publication are maintained in a manner that allows for accurate comparison—another small but important point. The new clause would achieve that objective. The alternative is to risk an inability to make like-for-like comparison, which of course would let the new organisation off the hook. Without continuity of data collection and publishing, GBR would be able to avoid comparative scrutiny.
Keir Mather
I thank the shadow Minister for his remarks. We consulted the industry and the public on the future of the content and functions of the alternative dispute resolution service, and identified that the transfer of the Rail Ombudsman sponsorship to the watchdog represents the simplest option with the least disruption to the passenger experience. That choice was supported by both Transport Focus and the Rail Delivery Group.
In the current service, decisions on disputes are made by legally trained staff. That gives passengers and operators assurance and confidence that disputes are handled fairly and correctly. The resolutions are binding, and the impartiality and neutrality between passengers and operators ensures that disputes are resolved fairly. Passengers achieve fair solutions, and operators are required to issue reasonable compensation. That places the balance of duty on operators while ensuring that the passenger experience is at the heart of what the ADR service is there to facilitate. If the shadow Minister requires any further information, I will happily seek it out and provide it.
On new clause 46, I assure the shadow Minister that the ORR will retain its role as the official publisher of rail statistics. As now the frequency of publication is not dictated by law, which enables flexibility and allows the collection of data to be proportionate and needs-based and ensuring necessary levels of transparency. Detailed arrangements for the collection of data by the ORR in the new system will be worked through with GBR once it is established. However, the current system provides a great deal of transparency and we do not propose to reduce that going forward.
The passenger watchdog will have access to the data collected by the ORR and be able to use it to identify issues in areas for improvement for passengers and to follow up. I therefore hope that the shadow Minister will feel that this matter is already addressed by the Bill and existing legislation and will seek to withdraw his amendment. I also thank him for his contributions.
Question put and agreed to.
Clause 44 accordingly ordered to stand part of the Bill.
Clause 45 ordered to stand part of the Bill.
Clause 46
Standards
Jerome Mayhew
I beg to move amendment 71, in clause 46, page 24, line 26, after “for” insert
“all users and potential users of the railways including, in particular,”.
This amendment allows the Passenger Council to set access standards for all users and potential users of the railway.
Edward Morello
I will speak briefly to new clauses 16, 17 and 18, tabled by my hon. Friend the Member for Didcot and Wantage, and new clause 53, tabled by my hon. Friend the Member for Epsom and Ewell. Accessibility is still inconsistent, poorly enforced and often treated as optional. If railways are to work for everyone, accessibility has to be planned, delivered and monitored.
New clause 16 would require a full review of the Access for All programme, including past spending decisions and future investment needs. Too many stations, particularly small and rural ones, still lack step-free access to platforms, entrances and exits. New clauses 17 and 18 focus on accessible passenger information on trains and at stations. Reliable audio and visual announcements on safety, stops and interchanges are essential for passengers with sight or hearing loss, and should be consistently monitored and enforced. New clause 53 would ensure that ticket machines are accessible, standardised and usable independently by all passengers. Machines must work for wheelchair users, people with visual impairments or limb differences, older passengers, and visitors without apps or digital access, offering the same tickets and interfaces across the network.
The new clauses are designed to deliver practical and enforceable accessibility that improves passenger confidence, independence and safety, and I very much hope that the Government will see the logic of them.
Keir Mather
I thank hon. Members for their amendments, which relate to the standard-setting role of the passenger watchdog and to accessibility. I will speak first to those related to the passenger watchdog.
Amendment 71 would allow the passenger watchdog to set accessibility standards for all users and potential users of the railway, replacing the current reference to disabled passengers and those needing assistance. It is important that all passengers can access the railway, and I support the shadow Minister’s intention to ensure that that happens. However, clause 46 already covers both users and potential users of the railway who require assistance to access services. Furthermore, the list of areas in which the watchdog may set standards is not exhaustive; it can set accessibility standards for anyone it deems appropriate, potentially including passengers travelling with prams or some of the other examples that were outlined. Let me also clarify that the wording of the clause is not exhaustive, so as well as the examples given in the Bill, the passenger watchdog can set standards on any other matters relating to passenger experience, at its discretion. That allows it to be responsive to passenger feedback and passenger needs. For that reason, I do not feel that the amendment is necessary.
Amendment 72 would expand the list of example areas where the passenger watchdog may set standards. First, as I mentioned, the clause already allows the passenger watchdog to develop standards covering all areas of the passenger experience. The list in subsection (2) sets out matters that may be covered by the standards and is not exhaustive, so it does not prevent the passenger watchdog from developing further standards in other areas in time; in fact, we expect that it might do so, for some of the very reasons that the shadow Minister suggested. The amendment is therefore unnecessary, as it would not make a practical difference to the watchdog’s powers. Let me also clarify that standards on safety and security would significantly expand the remit of the watchdog, and are best left to expert safety bodies such as the ORR.
Jerome Mayhew
I think the Minister may have misunderstood my point. I was not for a moment suggesting that the passenger watchdog should take over responsibility for safety-critical functions. I was anticipating that he might argue that the ORR needs to retain a veto right because there might be clashes with its safety-critical functions, in which case the clause could be redrafted to make it clear that that is the area of focus.
Keir Mather
I thank the shadow Minister for that clarification.
Amendment 141 would remove the requirement for the Secretary of State and the ORR to consent to standards that may be set, varied or revoked by the passenger watchdog. Amendments 73 and 144 would both remove the requirement for the ORR and the Secretary of State respectively to consent to new standards. It is my view that the watchdog must seek the Secretary of State’s consent before the standards are referenced in associated licence conditions, and therefore before they becoming binding on operators, because that is one of the only ways to ensure that the standards are affordable and actionable.
Ultimately, the Secretary of State is funding GBR, and if the Government are not able to provide the funds to support a new standard, which could in theory add costs for operators, the standards are doomed to fail. Similarly, the ORR will remain the sector enforcement body, enforcing all licences. It is therefore important that it gives consent to standards before they become binding on operators. That will ensure that all standards are fair and enforceable. These measures are necessary to ensure that the new rail system will work effectively. The Secretary of State’s and the ORR’s input into the standards will provide constructive challenge, ensuring that all standards are high quality and serve the railway as well as possible.
All three bodies are subject to the duty to promote the interests of passengers and disabled passengers, so they will share a common goal of improving the passenger experience. There should therefore be no concern that the process will weaken or undermine standards; rather, all bodies will be committed to improvements for the passenger. I therefore urge the hon. Members for Broadland and Fakenham and for Didcot and Wantage not to press their amendments.
New clause 16 would require the Secretary of State to review the Access for All programme, which delivers step-free access upgrades at stations across Great Britain. I recognise that passengers with accessibility needs often find rail travel challenging, as facilities and assistance frequently do not meet expectations. Many of Great Britain’s 2,581 railway stations predate modern accessibility standards, making navigation difficult for disabled passengers. That is why the Access for All programme was introduced in 2006, and why it is so important. More than 270 stations have benefited from it so far.
The hon. Member for Didcot and Wantage has proposed a review of the programme, and I am delighted to inform him that the Government agree with him so strenuously that a review was already conducted in late 2024. The Department and Network Rail have acknowledged that the delivery of the programme from 2019 to 2024 was disappointing, which led to the late 2024 review. The national Network Rail Access for All team has now been strengthened to improve governance and financial control, and accessibility has been given a higher priority by all Network Rail regions. That review, and the associated changes, resulted in almost 34 projects being completed in the last 18 months, compared to 36 in the previous five years. I think that that demonstrates our commitment to improvement.
Edward Argar
Does the Minister also recognise that the review has led to cuts of about 20 individual programmes? That was not done on the grounds of accessibility—although the letter I received from his colleague the noble Lord accepts that there is clearly a significant accessibility challenge in the case of station in my constituency—but by imposing on the scheme a match funding requirement that was never, as I understand it, part of the original scheme.
Keir Mather
The right hon. Gentleman is right to be impatient with the Government’s pace in achieving accessibility improvements at stations in his constituency and across the country. He is right to point out that even though the number of stations that have been upgraded and improved has increased, that does not mean that all stations have done been, and the Government need to work at pace to deliver improvements across the piece. However, given that the review the new clause requests has already happened, and that measurable improvements have already been demonstrated by the Government, although there is more work to achieve, I encourage the hon. Member for Didcot and Wantage to withdraw new clause 16.
I thank the hon. Member for new clauses 17 and 18, which together would ensure that accessible passenger information is provided for those with hearing or sight loss. Our commitment to the outcomes sought by the new clauses is clear and unambiguous. Accessibility is at the core of what we are here to do, and it will be central to GBR from day one. Both legislation and the GBR licence will ensure that accessibility is always considered.
I also recognise the importance of ensuring that timely information is provided, and that it is provided in a format that all passengers can access. To that end, the Bill lays the foundation for GBR’s licence, and establishes a powerful passenger watchdog with a mandate to act in disabled passengers’ interests, setting licence standards and holding GBR to account. The objective of these new clauses is best achieved there, where licence conditions can set out the necessary detail about what accessibility standards are needed, rather than in primary legislation.
To acknowledge that, the Government have already committed that accessible travel policies will be included in GBR’s licence. Those policies will include requirements, as they do now, about accessible information, including specific mention of visually and hearing-impaired passengers. The standards for accessible information included in the licence will be monitored by the passenger watchdog and enforced by the ORR.
The Government’s proposals for accessibility build on the work of the accessibility road map, published in November 2025, which is taking clear steps to improve real-time information provision on the railways, and rolling out welcome points across the network in England. Those will include closed-loop and British Sign Language capability. Despite the positive measures we have committed to in the Bill and in the licence, we are not waiting: we are acting now to improve things for people with disabilities. I therefore urge the hon. Member for Didcot and Wantage not to press the new clauses.
New clause 53 would require the Secretary of State to make regulations about the accessibility of ticket vending machines. I reassure the hon. Member for Didcot and Wantage that all station operators are currently required through their station licence to comply with an accessible travel policy, which includes assisting disabled passengers in relation to ticket facilities. Subject to consultation, we expect GBR to have a similar requirement in its new licence.
Keir Mather
I thank the shadow Minister for amendment 74 and new clause 45. Amendment 74 would give the passenger watchdog enforcement powers when it issues requests for improvement plans, and new clause 45 would give the passenger watchdog enforcement powers broadly equivalent to those of the ORR.
We are creating a strong passenger watchdog, which will have real powers to monitor passenger experience and hold GBR and others to account. It will be able to demand information from GBR to a deadline, investigate problems and demand improvement plans to encourage improvements. Finally, it can refer cases for enforcement to the ORR.
It is important to have one clear enforcement body for the entire sector to avoid duplication or confusion for industry. If there were two bodies with enforcement powers, the risk of conflicting enforcement steers would be too high. The ORR will therefore enforce GBR’s new, streamlined licence, ensuring that the organisation meets its industry obligations and all minimum standards, including passenger standards. As it does today, the ORR will also enforce all other railway licences, to ensure that there is an independent, consistent enforcement body for the sector. That is fair and rational.
If operators did not comply with their consumer licence conditions—for example, relating to accessible travel standards—the passenger watchdog would directly engage with them and request an improvement plan. We would naturally expect operators to comply with that request, because if they do not, they will be aware that the ORR can simply take action against them for the original licence breach. That mirrors what happens in practice today, where most compliance issues are resolved through direct engagement and improvement plans rather than resorting to enforcement.
Jerome Mayhew
I am interested in the Minister’s repeated insistence that there would be confusion if there were more than one enforcement body for rail activities. What is his proposed solution to the Competition and Markets Authority and its enforcement competency for the railways, which currently is shared with the Office of Rail and Road? Is it his plan to amend the competencies of the Competition and Markets Authority? If not, why is the argument so overwhelming to prevent the passenger watchdog from having teeth, when he allows the CMA to have teeth?
Keir Mather
The shadow Minister previously made a point that related to whether the ORR and the passenger watchdog had an equivalent power when they sought to enforce against railway licences. My point there was that we could have contradictory steers arising out of these licences being in conflict with each other. That is where the route of not having dual licence- enforcing capabilities lies, and it is the argument against amendment 74.
Turning back to operators’ co-operation, we expect our GBR licence proposals to include a licence condition requiring operators to co-operate with the passenger watchdog, which will strengthen these provisions further. I hope that that reassures the shadow Minister that the system will work effectively to hold operators to account. I cannot support any amendments that confuse the enforcement landscape, as two enforcement bodies would be duplicative, burdensome on operators and potentially very confusing. That is not a system that would drive good performance. I therefore urge the shadow Minister not to press his proposals.
Let me turn now to clause 47, which will give the passenger watchdog the power to require improvement plans from train and station operators where it judges that an operator might be breaching its standards and, therefore, the consumer licence conditions. Demanding improvement plans from operators will allow them to set out the steps they plan to take to address the issues and meet their licence conditions before non-compliance is referred to the ORR for potential enforcement action.
The clause will allow the watchdog to work with operators to seek improvements collaboratively. Improvement plans are a crucial element of this engagement, as they allow operators to set out a plan to achieve compliance and to have a dialogue with the passenger watchdog. The watchdog can represent the passenger by making suggestions for improvements and advocating sensible solutions. Enforcement is the last resort to ensure compliance, and it is important that the watchdog has sufficient means to encourage operators to do the right thing before it refers any persistent or serious issues to the ORR.
Jerome Mayhew
I am unpersuaded. As I previously indicated, I will press amendment 74 to a vote.
Question put, That the amendment be made.
Keir Mather
I will speak first to the clause and then to the amendments, once I have heard hon. Members’ comments on them.
Clause 48 will establish the passenger watchdog as a statutory adviser, able to advise Ministers and industry bodies on matters of importance to passengers. The clause places a duty on the watchdog to provide advice to certain bodies, including the Secretary of State, rail operators and devolved Governments; they may also refer matters to it. The watchdog will also have a duty to provide advice without a referral if it considers it appropriate. The watchdog will be in a unique position to understand passenger experience because of its research and investigations functions, as well as its access to complaints and core industry performance data.
We wish to establish the watchdog as the central body that Ministers, mayoral strategic authorities, the ORR, GBR and other train and station operators can go to for advice on passengers’ interests, needs and priorities. We also want to ensure that the watchdog is an authority on all passenger matters, so that Ministers and others take its advice seriously. This will be the first time that the rail industry has had a statutory adviser covering all passenger matters.
Clause 49 will place a duty on GBR to consult the passenger watchdog when developing or changing policies or procedures that significantly affect the interests of passengers. The clause sets out an indicative list of matters on which GBR should consult the watchdog. Those include passenger rights, handling disruption to rail services, determining fares, and arrangements for the sale of tickets. By feeding the watchdog’s insight to GBR when central policies and procedures are being developed, it will support GBR in creating better policies that prioritise passenger needs.
I return briefly to the official Opposition’s wise words about culture last week, because the Government absolutely agree that getting culture right is essential to the success of the railway. The watchdog’s role here will be critical in influencing the culture of the reformed rail industry, being involved in all relevant policymaking to ensure that the focus on passengers is at the heart of everything the railway does. I therefore commend clause 49 to the Committee.
Clause 50 will give the passenger watchdog the power to publish any information or advice it considers that passengers, or potential passengers, may find useful. For example, this could include publishing information on train operator performance to encourage improvements, such as league tables or the naming and shaming of poorly performing operators or routes. It could involve setting out complaint handling processes or advising passengers on their rights.
Before publishing information or advice, the watchdog must consider whether it is necessary to exclude any matter relating to an individual or body that would have a serious and negative impact on their interests. This could include sensitive, personal or market information. This power will be central to the watchdog’s ability to hold operators to account publicly.
I now turn to clauses 51 and 52. Clause 51 will give the Secretary of State the power to exclude certain rail services from the duties imposed by clauses 37 to 43, 45 and 48. This power mirrors an existing power in the Railways Act 1993 and has been included because it is not appropriate, nor a proportionate use of resources, to require the watchdog to investigate services that are not part of the wider national network, are not licensed and mainly operate for tourism or leisure purposes—such as heritage trains. As service providers change over time, the clause can also be used to include new services in the watchdog’s remit, or to modify its duties in relation to specific services. In the future, there may be new services that the watchdog ought to monitor, or which it ought to monitor in a slightly different way. The power therefore exists to ensure that all relevant operators can be appropriately held to account by the passenger champion. The clause does not mean that the watchdog is prevented from monitoring any excluded services, just that the watchdog is not obliged to do so.
Clause 52 provides additional clarity by defining some of the terms used in this chapter. For example, the clause defines a “disabled person” as
“a person who is a disabled person for the purposes of the Equality Act 2010”.
I commend clauses 48 to 52 to the Committee.
Jerome Mayhew
The Minister has described the function of clause 48, the lead measure in this group, but there is one notable exception from the list of bodies that can refer to the council for advice under clause 48(1)(a) as drafted. It includes mayoral combined authorities, Transport for London and Ministers—whether the Secretary of State, Welsh or Scottish Ministers—but there is no room for local transport authorities. I am sorry that my hon. Friend the Member for South West Devon is not in her place, because she made the point powerfully in previous sittings of the Committee that some areas of the country do not have mayoral combined authorities and never will, because of their geographic or demographic set-up—that is particularly the case in the south-west. Those areas still have local transport needs, and a local transport authority, yet under the Bill as drafted, those authorities are excluded from asking the advice of the passenger body. We have heard that there are many areas that will never have an MCA but that still have rail-related concerns and issues. I seek advice from the Minister: what is the thinking of the Government, that they have deliberately excluded local transport authorities from the clause?
Clause 49 deals with “Consultation about railway passenger services and station services”. Again, I have left it to the Minister to explain what the clause does, but it sets out the policies and procedures that GBR should consider consulting the passengers’ council on. It gives GBR discretion to decide whether to do so based on its assessment of the impact on passengers. That is, again, quite important. The clause creates a duty on GBR to consult the passengers’ council, but only where GBR itself decides that a policy change will significantly affect passengers. The explanatory notes confirm that that judgment is entirely for GBR. GBR, the Secretary of State and Scottish Ministers will all owe consultation duties to the council, but the Bill imposes a duty only on GBR, and even then only on GBR’s own assessment of significance. There is no parallel duty on Ministers, meaning that major ministerial decisions affecting passengers could fall entirely outside statutory consultation. The list in clause 49(2) once again seeks to sideline the passengers’ council by limiting its remit. The list does not cover the issues that
“significantly affect the interests of the public in relation to…passenger services or station services”,
as described in clause 49(1)(b); far from it.
Amendment 75 would require GBR to consult the passengers’ council when GBR is developing or changing its procedures, with reference to the passenger-focused KPIs outlined in proposed new clause 2:
“reliability, including punctuality…short-forming…key connections… safety and security…comfort and on-board experience”
and
“affordability and value for money”.
Those are issues at the heart of the passenger experience. Let the passengers’ council do a proper job.
Clause 50 gives the passengers’ council the power to publish information and advice for
“users or potential users of railway passenger services”.
The clause only allows the passengers’ council to publish information; it does not require it to publish information. That means the council can choose not to publish anything at all. The clause also gives no sense of what should be published, or how often. Perhaps the Minister could expand on the reasons he has not decided to require publication when it is about information and advice; that seems a bit odd.
Clause 51, which is on the power to make exclusions, will be watched by many, as it is really important to rail enthusiasts. Committee members should be careful when commenting on it, because people are keenly interested in this power. Actually, on this occasion I think the Government have got it about right. The clause replicates similar provisions in the 1993 Act—specifically, sub-sections (7B) and (7C) in section 76.
Clause 51 enables the Secretary of State to exclude services from one or more of the duties imposed by clauses 37 to 43, 45 and 48 through regulations, or modify those duties for particular services. However, before making changes, the Secretary of State must consult the passengers’ council and the London Transport Users Committee.
There are currently two exemptions from the similar requirements in the 1993 Act in place, one of which excludes services without through-ticketing facilities and which are exempt from holding a licence. Charter and heritage railway operators fall under this exemption. The Government assert in the explanatory notes to the clause that,
“it would be burdensome and unnecessary for the Passengers’ Council to be required to investigate heritage railway operators,”
which only operate for tourism and recreational purposes, not for the mainline network. I agree that those potential exclusions are reasonable. The Government rightly point out that burdening heritage rail with unnecessary regulation when the hospitality and tourism sector is facing serious challenges—admittedly, because of this Government—would be disproportionate.
Very few constituencies do not boast a heritage railway, so I declare an interest, Mrs Hobhouse: the Bure Valley Railway and the start—or the finish, depending on which way a person is going—of the Wells and Walsingham Light Railway run in my constituency of Broadland and Fakenham.
Keir Mather
I start by addressing two points that the shadow Minister made. First, on the publication of information and advice, I set out in my original arguments surrounding the new clauses that there might be instances where, for professional or personal reasons, it might be best not to publish confidential information.
On a broader issue, the shadow Minister asked why local transport authorities were not listed directly under clause 48. On the question of the devolution of rail services, the Committee has rehearsed at length the Government’s view that mayoral strategic authorities provide the right unit of economic activity to be able to engage with productively. Nevertheless, this is not an exclusive list of those that might be consulted, and there is provision written into the Bill for the council, where it considers it appropriate, to consider consultation without such a reference as is listed in the clause. Local transport authorities could fall within that frame of reference.
Amendment 75 would ensure that GBR consulted the passenger watchdog when developing key performance indicators. GBR will set out its proposed activities over a five-year period in its business plan, setting KPIs for itself there based on how it intends to deliver the business plan and, through that delivery, meet the high-level goals in the Secretary of State’s funding objectives and her long-term rail strategy. The ORR will independently scrutinise GBR’s business plan and advise the Secretary of State on its quality, which will give the Secretary of State the right information to support her decision on whether to approve the plan. All advice on the business plan can and should be published, so the public can also be aware of how that is developing. This constructive challenge process will ensure that GBR’s KPIs are realistic, measurable and ambitious.
Additionally, as we have discussed, there is already a requirement in clause 49 for GBR to consult the watchdog on policies or procedures affecting users or potential users of the railway. This would also cover consultation on any KPIs about passenger services. Therefore, this amendment is duplicative of the drafting already in the Bill, and I urge the shadow Minister to withdraw it.
New clause 68 would give the Secretary of State the power to direct GBR to co-operate with transport authorities to reduce disruption. First, it is clearly critically important that we reduce disruption for all passengers and stakeholders on the railway. I agree with the hon. Member for Runnymede and Weybridge that GBR should collaborate with local authorities to reduce transport disruption across modes. I am aware of his efforts to campaign for more joined-up planning in his area, and I hope that the Bill will improve the system for him.
I would point out to the hon. Member for Runnymede and Weybridge, however, that there are mechanisms elsewhere in the Bill that will enable the sort of collaboration and co-operation that the amendment envisages. The Government are supportive of a more locally focused railway and an enhanced role for mayoral strategic authorities. Local partners know their areas best, which is why GBR will be able to agree partnerships with MSAs to enable close collaboration and joint working on local priorities.
Together, the provisions in the Bill create a framework for significant levels of co-operation between GBR and transport authorities. GBR will be organised to work collaboratively with devolved leaders, and I would expect that potential disruptions would be discussed between them as a result of those closer working relationships, enabling them to explore possible measures to reduce disruption and contribute to the effective operation of transport networks.
I thank the shadow Minister for speaking to new clause 70, which seeks to impose several requirements on GBR before it can make service changes, such as publishing a statement, publishing a notice of changes on stations or routes, providing compensation for passengers and consulting various stakeholders.
Let me address each of those elements in turn. It is redundant for GBR to publish a statement about whether service changes are compatible with its functions. The Bill assigns GBR the function of providing railway passenger services, and planning service changes is inherent in that. There is no need to affirm that separately through a published statement.
GBR will not plan service changes in a vacuum. Clauses 80 to 82 require GBR to consult Scottish and Welsh Ministers, mayoral combined authorities and Transport for London before making decisions that will significantly affect the interests of the economy and people in those areas. GBR will also be required through its duties to consider local transport plans when making service changes.
As for publishing notices, it is for GBR to determine the best approach to communicating service changes to the public, and GBR should be able to adapt its communications approaches in line with stakeholder needs and technological advances. The consumer standards set by the passenger watchdog will cover passenger information. I hope that reassures the shadow Minister that appropriate information will be provided to passengers. The watchdog will have powers to request improvement plans and refer issues to the ORR for enforcement when GBR falls short.
I now turn to planned service changes. For clarity, as the new clause indicates, that relates to when GBR chooses to replan services in advance, for example timetables and stopping patterns. It does not relate to service disruption. I cannot see a feasible or a necessary solution to providing compensation to passengers affected by service changes of this nature. Clearly, the development of an effective timetable requires the need for service changes, for example to make the most of infrastructure enhancements for the benefit of passengers and communities. That will especially be the case under GBR, as GBR can review the network and timetable holistically and make joined-up decisions in a way that has been impossible in previous years.
In relation to compensation, quite apart from the undeliverable practicalities of funding and administering such a scheme, at the heart of this is the fact that GBR is being established as the expert-led directing mind of the railway, in charge of planning the best use of the network and balancing its statutory duties. Those duties include promoting the interests of users and potential users of railway passenger services and acting in the public interest. Any planned service changes by GBR will therefore be the result of that new system and guided by those duties. Forcing GBR to compensate all those affected by service changes would therefore cut across GBR’s ability to balance its duties in the round, and could create perverse incentives not to make changes and to allow services to stagnate.
I add one point of assurance: service change and service closure are separate issues. The Railways Act 2005 contains the specific processes that must be followed for full service closures, with a decision-making role for Ministers who are the relevant railway funding authority for a given service. Closure proposals must also be ratified by the ORR. The Bill does not change the fundamentals of this process, which protects our important passenger services. I thank hon. Members for their contributions.
The Chair
With this it will be convenient to consider the following:
Clause 54 stand part.
Government amendment 173.
Clauses 55 to 58 stand part.
Keir Mather
Committee members will be very pleased that I have considerably less to say about this group than the previous one.
Government amendment 173 corrects a small naming error in the Bill: a clause for the London Transport Users Committee incorrectly refers to the passengers’ council. The correction ensures that the Bill is drafted correctly.
Clause 53 will place two general duties on the London Transport Users Committee, which has the operating name London TravelWatch, that it must consider when carrying out its rail functions: to consider the interests and needs of disabled persons, and to consider the costs and efficient use of public funds. The aim of the clause is to align the duties of London TravelWatch with those of the passenger watchdog and ensure that both passenger champions will pay specific attention to the experiences of disabled people. The duties also ensure that the passenger champions take the overall cost of the railway into account, such as when making recommendations for improvement. That will ensure that their recommendations are realistic and actionable and, therefore, carry more weight in the industry. Aligning London TravelWatch’s duties and powers with the passenger watchdog, as many of the clauses do, ensures consistent passenger advocacy across Great Britain.
I now turn to the remaining clauses 54 to 58. Clause 54 expands London TravelWatch’s powers under section 252A of the Greater London Authority Act 1999 by giving it the explicit power to collect information that may be of interest to the public. Clause 55 expands London TravelWatch’s current investigation powers to align it with the powers the Bill grants to the passenger watchdog. That includes expanding the list of people who may refer matters to London TravelWatch for investigation, enabling them to obtain information from operators to a deadline, make representations on behalf of passengers and refer matters to the ORR for enforcement, as well as powers to publish investigation reports.
Clause 56 will designate London TravelWatch as the body to which complaints about potential infringements to retained EU law on rail passenger rights should be addressed within the London railway area. Clause 57 will give London TravelWatch the power to publish information and advice it considers appropriate for users or potential users of the railway in London. That could include information on operator performance—including GBR’s performance in London—such as league tables or naming and shaming, as well as passenger rights and complaint-handling processes. Clause 58 will ensure that London TravelWatch protects sensitive and confidential personal and commercial information obtained during its investigations or through its general power to collect information. I commend these clauses to the Committee.
Jerome Mayhew
We are at the final furlong—for today at least. I will keep the pace up for the last straight. I am not going to make any comments on clause 53, the general duties of the LTUC, because there is nothing to be improved. Clause 54, which amends section 252A of the Greater London Authority Act 1999, mirrors the passengers’ council in many ways. We could take the opportunity to seek to apply the same improvements to the LTUC that we have to the passengers’ council, but I have resisted that temptation given the Government’s reaction to all other proposals to date.
Clause 55 designates the committee as the body to which complaints about potential infringements of retained EU law on rail passengers rights should be addressed. I see no issue with that other than in relation to the criticism we have already outlined regarding the passengers’ council. It is clear that the clause is designed to ensure consistency in London in line with the rest of the United Kingdom, so we have no amendments there. I take on board the Minister’s comments on Government amendment 173 and make no further comment.
Clause 56, which is about complaints to the LTUC, again, allows the LTUC to be the official body in which complaints about retained EU law are handled. As the Minister has pointed out, that clause, like others in this group, mirrors the ability of the passengers’ council, so we have nothing else to add on that one.
I make no comments on clause 57 about the publication of information and advice by the LTUC. That brings us to clause 58—restrictions on disclosure of information by the LTUC. As we come to the last clause of the London Transport Users Committee, we also come to the last amendment to the Greater London Authority Act 1999. For those keeping track of these things at home, we are now amending section 252DC. The clause outlines restrictions in a very similar fashion to that of the passengers’ council, so we consequently have no further amendments to suggest for that clause either.
Keir Mather
I thank the shadow Minister for his constructive approach to the remaining clauses and the Government amendment as part of this group. He and his colleagues have ably and comprehensively outlined any potential concerns that they have in relation to the passenger watchdog, many of which would map over to consideration of these clauses. Therefore, I have put our points in relation to this group on the record.
Question put and agreed to.
Clause 53 accordingly ordered to stand part of the Bill.
Clause 54 ordered to stand part of the Bill.
Clause 55
Investigations by the LTUC
Amendment made: 173, in clause 55, page 31, line 30, leave out “Passengers’ Council” and insert “Committee”.—(Keir Mather.)
This amendment corrects a reference that was made to the incorrect body.
Clause 55, as amended, ordered to stand part of the Bill.
Clauses 56 to 58 ordered to stand part of the Bill.
Ordered, That further consideration be now adjourned.—(Nesil Caliskan.)
Railways Bill (Ninth sitting)
Keir Mather ExcerptsTuesday 3rd February 2026
(5 days, 4 hours ago)
Public Bill CommitteesRead Full debate Railways Bill 2024-26 View all Railways Bill 2024-26 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Public Bill Committee Amendments as at 3 February 2026 - (3 Feb 2026)
Jerome Mayhew
Thank you, Mrs Barker, for chairing the debate. It is great to see everyone back in the room.
Clause 25 requires the Secretary of State to designate the railway passenger services for which Great British Railways should be responsible. Designation is the mechanism for assigning responsibility for running passenger train services. The Secretary of State, Scottish Ministers and Welsh Ministers each have designation powers to set out services that GBR or others, including ScotRail, may run for them. Ministers can exempt services from these designations, thereby allowing them to be devolved to other authorities such as Transport for London. Designation also underpins the delineation of relevant powers and requirements in relation to those services, such as the discount fare schemes that we are going to discuss with clause 34.
The clause requires the Secretary of State to designate the railway passenger services for which GBR should be responsible. It excludes Scotland-only and Wales-only services, as well as services exempted under clause 28. Again, there is a reference to Transport for London, among others, being exempted from designation by the Secretary of State. It also clarifies that the Secretary of State is not required to designate services, even if parts of them are already designated by the Scottish or Welsh Ministers.
The explanatory notes state:
“The new Secretary of State designation is expected to be succinct and will not provide route nor timetable-level detail. This will ensure GBR has sufficient flexibility to act as a directing mind and plan best use of the network in the public interest and in accordance with its duties…All designations and changes must be published.”
The Government’s notes on the clause describe GBR as the “directing mind”, yet all its powers are able to be second-guessed by the Secretary of State, including the designation of services. That really prompts the question once again, who is the directing mind? Is it GBR or the Secretary of State?
The seeds of GBR’s failure as a directing mind are already being drafted into the text of the Bill. We have already seen all the Secretary of State’s rights to provide “guidance”, then to “direct” in clauses 7 and 9, as well as the long-term rail strategy in clause 15 and the decision on the provision of funding. This is Department for Transport management of the nationalised railways by the back door, confirming the suspicion that GBR will be, or is at risk of being—I hope it is not—the worst of both worlds. These are costs associated with a stand-alone organisation, coupled with the costs of a DFT shadow organisation that over time will grow again to second-guess GBR as catered for in this Bill. It is not just about the cost; it is about the delay, the obfuscation, the inability to decide whether a decision has actually been made and the second-guessing of decisions. That is death to dynamism in an organisation.
The railways obviously have two functions: passenger services and freight. Amendment 226 will make clear that any designation of passenger services will need to have taken account of freight and demonstrate that freight is not caused unreasonable detriment to capacity or future growth. The amendment is clearly in the interests of the common cause to make freight growth a target for GBR, which the Government agree with. It is impossible to deal with either passenger or freight without having regard to the other. That mutual regard is missing from the Bill, and this amendment supplies the necessary focus, so I shall seek to divide the Committee on it.
I move now to clause 26 and amendment 227. We recognise that, at present, Scotland funds and controls Scotland-only services. Scotland can and does designate cross-border services where it has an operational interest. Scotland must consult with the Secretary of State but, ultimately, has autonomy on Scotland-only designations. Clause 26 requires Scottish Ministers to designate Scotland-only railway passenger services and particular cross-border services—either those that they consider should be provided together with Scotland-only services or existing cross-border services designated to them before the Bill comes into force. It ties into clause 31, where Scottish Ministers can provide the designated services themselves or make direct awards under regulation 17 of the 2023 transport regulations.
In this instance, “Scotland-only services” refers to passenger services that start and end in Scotland and do not make a scheduled call in England or Wales. It provides flexibility for the designation to be made either for specific services or for services of a particular class or description. It also allows Scottish Ministers to designate cross-border services where they consider those services should be provided in conjunction with designated Scotland-only services. It is also worth noting that the clause excludes from designation any services exempt under regulations made under clauses 28 or 29, and requires consultation with the Secretary of State before designation, variation or revocation. It is my understanding that very limited designations are reserved to the UK Government. They lay primarily around open access and freight. Those two areas, I suspect, we will enter into discussions at length later in the Committee.
On cross-border services, it is eminently sensible that the UK and Scottish Governments co-ordinate strongly on this. A later amendment to another clause relates to the allocation of ticket sales on a proportionate basis, to ensure that UK and Scottish Governments—in the fullness of time, we will discuss the Welsh Government too—each get their fair share of funding. Amendment 227 would apply a duty to Scottish Ministers, similar to the one that amendment 226 would place on the Secretary of State, to take account of the rail freight target and the infrastructure capacity plan when considering passenger services. Depending on how the vote goes on amendment 226, I will take a view on whether it is worth proceeding to another Division on amendment 227.
Finally, I turn to clause 27 and amendment 228. It is a broadly similar approach, but applies to designation of services by Welsh Ministers. Hon. Members can read the explanatory notes if they wish, but I am just going to take that as read. On first reading the clause, it seemed sensible; after all, Welsh Ministers are responsible for services that start and end in Wales. The cited example in the explanatory notes is the Cambrian line, which typically goes from Aberystwyth and Pwllheli to Shrewsbury or Birmingham International. These services will, on occasion, terminate at Machynlleth. The Heart of Wales line goes between Swansea and Shrewsbury, and Holyhead services will typically end in England. The Welsh Government will have only a handful of services exclusively in Wales. That is a substantially different from Scotland. Those services are the Core Valley lines, the dedicated Swansea to Cardiff route and the Blaenau to Llandudno route—only three. All other services that start in Wales will generally run into England, which poses a significant challenge for the allocation of moneys from ticket sales.
The Minister may find it useful to outline the practical management of cross-border rail services, and how the Welsh Government’s operator can operate with a degree of confidence when it must report to both Governments, but exists under only one. That is a genuine tension, which I would be grateful if the Minister could explain the Government’s thoughts on.
Amendment 228 is similar to amendments 226 and 227. I will not repeat my arguments, but there is a qualitative difference between the situation in Scotland and that in Wales. It will have a significant impact on revenue sharing, where 97% of all routes for the Welsh Government contain an English element. I would be grateful if the Minister could consider that.
The Parliamentary Under-Secretary of State for Transport (Keir Mather)
Good morning, Mrs Barker, and to everybody—another day in Committee. I thank the hon. Member for Broadland and Fakenham for these amendments, which seek to ensure that the designation of passenger services does not negatively impact rail freight or undermine GBR in network capacity planning activity.
I hope it is helpful if I clarify that clauses 25 to 27, which set out designation powers of the Secretary of State and devolved Ministers for passenger services, only describe a very high-level mechanism for assigning responsibility for passenger services. For example, the designation helps make clear who is responsible for the service. Further clarity is provided by exemption from designation to show where services have been devolved to other authorities, such as to mayoral strategic authorities or Transport for London. Designation is not a detailed service specification, nor does it determine network access or capacity allocation.
Last week, we published a draft of the Secretary of State’s designation letter to help clarify that, and copies are available in the room today. Ministers’ designation powers do not override or conflict with GBR’s role in determining network access. The access decision process requires GBR to balance passenger and freight needs. The safeguards in the Bill, including the statutory duty to promote rail freight or the ORR’s oversight and appeals body to protect fare freight access are also unaffected by designation. The amendment is therefore impractical and unnecessary and would not achieve its intended purpose in practice.
Protecting rail freight, which I fully endorse, is already enshrined within the Bill. For absolute clarity, I must emphasise that the access clauses in the Bill set out the stages through which network access is determined. It is not determined or affected by designation. The access clauses include producing the infrastructure capacity plan, which will set out GBR’s view of how best to use GBR’s infrastructure to accommodate freight, open access and publicly funded passenger services, as well as maintenance and improvement of the network. GBR will take into account its infrastructure capacity plan when allocating capacity. In comparison, designation is simply the method of determining whether a service should be devolved to, for example, a local authority, or maintained by the Secretary of State and run by GBR. I therefore request that the hon. Member withdraw the amendment.
Clause 25 requires the Secretary of State to designate railway passenger services for which GBR should be responsible. Designation is the mechanism by which responsibility for who should run passenger rail services is determined. Clauses 26 and 27 replicate this, but for Scottish and Welsh Ministers respectively. The Secretary of State, Scottish and Welsh Ministers each have designation powers to set out services which GBR or others—including Transport Scotland or Transport for Wales—may run for them. Designation powers will also assist in providing clarity about which Minister has responsibility to provide, or contract for, cross-border services. Ministers can also exempt services from these designations, which is the way that services can be devolved to mayoral strategic authorities. That was the mechanism used to allow Transport for London to run its devolved service. As I have mentioned, the new Secretary of State designation is expected to be succinct and will not include route level or timetable detail. Designation is therefore entirely separate from access or timetabling decisions.
Jerome Mayhew
As I intimated previously, I will put the first amendment to a Division and then we will take a view after that.
Question put, That the amendment be made.
Keir Mather
Clauses 28 and 29 enable the Secretary of State and Scottish and Welsh Ministers to exempt certain railway passenger services from designation. Exempting a service means that the Secretary of State or devolved Ministers will not be responsible for that service. Instead, responsibility can be devolved to someone else—for example, a mayoral strategic authority—for them to run or contract out the service. That mechanism preserves the existing approach for devolving services to mayoral strategic authorities and their transport agencies, such as Transport for London or Merseytravel, and for light rail networks such as in Greater Manchester. The Secretary of State cannot exempt Scotland-only or Wales-only services, because those fall under the devolved responsibilities of Scottish and Welsh Ministers. Clause 29 allows devolved Governments to determine which services fall outside designation, offering flexibility in managing their respective networks.
These clauses are necessary to ensure that there is still a way to devolve services, where that can bring benefits and is the best outcome for the network. Exemptions must be made by regulations, ensuring that the allocation of responsibility for passenger services is transparent. Clause 30 provides supplementary provisions for exemptions under clauses 28 and 29. It allows exemptions to apply to specific persons, classes of persons, services generally or parts of services. Exemptions may be conditional or time-limited, so that decisions to devolve services can be tailored to the specific circumstances on a case-by-case basis.
Jerome Mayhew
You will be surprised to hear that I am going to canter through this, Mrs Barker. Clause 28 concerns the method by which the operation of passenger train services has been devolved. A good example is services operated by Transport for London and Merseyrail. It is clearly a sensible approach. There is only one clarification that I seek from the Minister. Paragraph 103 of the explanatory notes states:
“All existing exemptions from designations…will be retained.”
That, however, is not in the Bill. I would be grateful for the Minister’s clarification on the difference between the explanatory notes and the Bill. I am not looking for an amendment to the Bill, but his assurance on the Government’s intention. Clause 29 is similar, but relates to Scottish and Welsh Ministers. I see no need to change it as drafted. It sits in line with clause 28 and seems not to act in contravention of the devolution settlement.
Clause 30 clarifies that exemptions made under clause 28 by the Secretary of State, or clause 29 by the Scottish or Welsh Ministers, may apply to specific persons, classes of persons or services generally. I have no objection to the clause, but out of interest, I would be grateful if the Minister could explain in what circumstances the clause would be useful.
Keir Mather
I can start by confirming that existing exemptions from designation will be retained. I hope that provides an assurance to the shadow Minister. The powers could be used to allow devolved Administrations to determine which services fall outside of designations, and therefore give them flexibility in meeting the needs of passengers relying on services that otherwise could fall through the cracks. I hope that, having provided the shadow Minister with that assurance, he can support these clauses.
Question put and agreed to.
Clause 28 accordingly ordered to stand part of the Bill.
Clauses 29 and 30 ordered to stand part of the Bill.
Clause 31
Provision of railway passenger services
Jerome Mayhew
I beg to move amendment 41, in clause 31, page 16, line 30, leave out from “so” to “, in” in line 31 and insert
“by making a direct award of a contract to Great British Railways, a GBR company, or a private business.”
This amendment would allow private sector companies to operate train services on behalf of the Secretary of State.
Olly Glover
Apologies. One recognises one’s status.
We agree with the shadow Minister on the principle that it should not be about ideology between the public and private sectors. We have argued that consistently in the past. If it was so simple that nationalising train operators would lead to transformative performance improvements, Northern would be a globally inspiring example. I realised this morning that this month it reaches its half-decade anniversary of being in the public sector and, certainly for friends of mine in the north, it remains some way from being a globally leading example. That highlights the fact that public and private sector ideology is but one factor needed to give excellent rail services.
I wonder whether some of the shadow Minister’s amendments are perhaps fighting yesterday’s war. Of course we should all continue to advocate for what we believe, but it seems unlikely that—in the near future at least—there will be a change in approach to the core train operating companies’ being franchised out. Perhaps, rather than relitigating that, we need to focus on other aspects of the Bill, as indeed he has done, and on how we can make the new world better—particularly by removing the Secretary of State’s ability to interfere too much. I wonder what the shadow Minister and Government Minister have to say about that.
Keir Mather
May I begin by saying that I hope the shadow Minister can forgive my initial sluggishness on this drab Tuesday morning, because he asked a perfectly reasonable question about the application of the clause when we debated it last. I did not give him an adequate answer so, if you do not mind me looking retrospectively for a moment, Mrs Barker, I would like to inform him that all existing designations are unconditional. The clause is not there to be used often. However, it replicates an existing power, with the idea being that if the Secretary of State wanted to exempt a service to a new local authority that had not had an exemption before, she might wish to provide a time limit to check how it was performing before granting a longer-term exemption. I hope that is a sufficiently adequate answer to his perfectly reasonable question.
I will now speak to the amendments tabled in my name. Amendments 170 and 171 enable Welsh Ministers to continue securing rail services in the Wales and borders region on behalf of the Secretary of State. Welsh Ministers will do that by contracting Transport for Wales to run the services. That will ensure that passenger services that cross between England and Wales every day continue to connect communities, contributing to economic growth. Without these amendments, the Secretary of State would be forced to abandon existing agency arrangements and procure all the services that she designates exclusively through Great British Railways, including English sections of the services currently operated by Transport for Wales. That is inefficient, and contrary to the collaborative spirit of devolution. This is about making the system work, not creating barriers where none need exist. The amendments were always intended to be part of the Bill, and we are correcting that now. The amendments strengthen the Bill by preserving today’s devolved responsibilities once GBR is established. That will ensure that Transport for Wales can continue running services into England, maintaining reliability for passengers and ensuring connectivity.
The other amendment tabled in my name, amendment 172, is a minor and technical amendment that removes a redundant provision in the legislation. I am grateful to the hon. Member for Isle of Wight East for his parliamentary question in November 2025 regarding the policy rationale for that drafting, which helpfully drew it to our attention. I am pleased to confirm that it is no longer necessary.
Amendment 41 and new clause 6 are intended to reintroduce private sector companies running passenger services. The Government were elected on a clear manifesto commitment to return franchised passenger services to public ownership. Public ownership, with the whole system working to one clear set of objectives to improve reliability, performance and punctuality for passengers, is the only way to make the railway run better. I think we all agree that the current system simply is not working. However, the amendment and new clause seek to undo all the progress we have made so far. They could cause chaos on the railway and return us to the dark days of franchising, which did not perform for passengers or taxpayers. The Bill is not about re-debating the principles of public versus private; it is about getting on with this generational reform and delivering for passengers, freight users and taxpayers.
Finally, amendment 44 would require the Government and Scottish and Welsh Ministers to publish pre-award details of public service contracts at least a year in advance of entering into the contract. As I am sure the hon. Member for Broadland and Fakenham knows, publishing pre-award information a year in advance would be an unnecessary and impractical administrative burden. The focus for public service operators should be on efficient delivery and clear reporting rather than rigid pre-award timelines. The Government will continue to be required to act transparently by publishing relevant information about the contract, such as contract dates and the parameters of financial compensation, within two months of entering into the contract.
Given those points, I urge the Committee to support the amendments in my name and I hope that the hon. Member for Broadland and Fakenham will withdraw, or not move, his amendments. I also hope that the Committee supports clause 31, which sets out how designated services are to be provided, and clause 32, which sets out supplementary provisions for public service contracts awarded under clause 31.
The Bill makes it clear that the Secretary of State may assign responsibility for running her services only to Great British Railways or a GBR company. She can secure the provision of services by first designating them and then making a direct award of a public service contract to GBR or a GBR company. Public service contracts are a typical arrangement between public authorities and transport operators for providing public transport and are compliant with relevant subsidy control requirements. As clause 32 sets out, contracts may include a range of obligations, including those relating to additional railway assets, operational requirements and financial arrangements—for example, how any payments will be calculated, and performance targets.
Scottish and Welsh Ministers may either provide designated services directly in house or secure them through a direct award to one or more public sector companies, such as ScotRail or Transport for Wales. They also have the option to contract with GBR or a GBR company, which could unlock the integration of track and train in Scotland and Wales. Clause 31 also ensures that GBR’s duties apply to services operated by joint ventures or GBR subsidiaries under contract and gives Scottish and Welsh Ministers powers to handle freight goods where necessary.
Jerome Mayhew
The Minister’s response demonstrates an extraordinary lack of confidence by the Government in the efficacy of nationalisation—the very thing that they are seeking to promote in the majority of the Bill. All that amendments 41 to 43 would do is give the Secretary of State flexibility by making them able by law, in certain circumstances, to give a contract for passenger services to the private sector. They would not require it; they are not saying that this is a battle between privatisation and nationalisation. The only ideological battle here is by the Government, who are saying that it is impossible to conceive of any circumstance in which a private business might be able to offer better value for money for the taxpayer and a better service for passengers than a nationalised part of GBR. They are so concerned that a private business might be offered that opportunity, because they are overwhelmingly better, that they are seeking to legislate to tie the hands of every future Secretary of State.
Edward Morello (West Dorset) (LD)
It is an honour to serve under your chairship, Mrs Barker.
As the shadow Minister outlined, amendment 148 tabled by my hon. Friend the Member for Didcot and Wantage is not overly dissimilar to Conservative amendment 45 in what it tries to achieve, but I will come at it from a slightly different angle. Clause 33, as drafted, gives the Secretary of State the power to issue binding directions to Great British Railways on the level and structure of fares. We have said many times that the Bill already grants the Secretary of State extensive influence over GBR. Allowing binding directions on fares risks tipping that influence into outright micro-management. It opens the door to the imposition of short-term political decisions, rather than long-term, evidence-based decisions about fares being made by those responsible for actually running the railways. It is a tool that can be misused, particularly in times of fiscal or political pressure.
Even if the current Government assure us that they would not misuse the power, the problem is that once it exists, it exists for all future Governments. I hope the Government will recognise the inherent risk in that and support amendment 148, thereby preventing not only themselves but all future Secretaries of State from being able to abuse the power.
Keir Mather
On the role of the Secretary of State in setting parameters for fares, we have had a lot of debate in the Committee about the need to ensure efficiency on behalf of taxpayers, who are also passengers on the railway. It is the Secretary of State who ultimately has the democratic responsibility to do so; therefore, it is right that the power exists to set broad parameters as they relate to fares. However, that process must be undertaken transparently. Parameters will be set through guidance and public service contracts, which will be published and open to scrutiny. The Bill says that the Secretary of State can direct on fares, but not that she will do so regularly. That is important to the point about overreach, and the exceptional circumstances in which direction might be a wise provision to have in the legislation. I will turn to that later.
Edward Argar (Melton and Syston) (Con)
Can the Minister give a few examples of the exceptional circumstances that might cause the power to be used?
Keir Mather
The right hon. Member is far too eager. I shall turn to that in due course.
Amendment 148 would prevent the Secretary of State and Scottish Ministers from issuing directions to GBR relating to fares, and amendment 45 would do the same for directions and guidance. I remind hon. Members that, as I said when we debated the directions and guidance clauses earlier in the Bill, the strategic parameters and guardrails that the Secretary of State will set for GBR on fares may not ultimately be delivered through directions and guidance by default.
Clause 33 already allows for provisions on fares parameters and guardrails to be included in public service contracts awarded to GBR for operating passenger services. Nevertheless, it is crucial that the Secretary of State retains the powers to direct and give guidance to GBR on fares. It is necessary that the Government and GBR alike can respond to exceptional circumstances, which may necessitate a swift reappraisal of the strategic approach to fares. That is precisely what the Secretary of State’s directions-making power allows for, supplemented by the ability to issue guidance, to ensure a clear and speedy response if there is a crisis or unexpected change in context.
Amendments 148 and 45 would remove those options for the Secretary of State and, in fact, for Scottish Ministers where GBR is operating services that they designate. The Government strongly believe that that is not in the interests of passengers or taxpayers. I agree with Opposition Members that we do not want Ministers interfering with day-to-day fares policy. GBR will have the freedom to define its fares policy within the parameters and guardrails set out, simplifying fares, removing duplication and, in turn, improving value for money. It will therefore be set up to succeed from the outset. Contrary to what Opposition Members believe, the powers in clause 33 do not undermine that.
Edward Morello
I know it has probably been overused already in the Committee, but I keep returning to the NHS England example. The Government set up arm’s length bodies and Ministers are then invariably unable to resist the urge to tinker. The Government devolve responsibility out and then realise that having something completely arm’s length, which they have no control over, is very unattractive when they are politically responsible. What starts off being explained as happening only in exceptional circumstances invariably becomes day to day. The amendments are an attempt to protect against a repeat of the mistake with NHS England, which the Government are now having to unpick.
Keir Mather
We have repeatedly had this allusion drawn between NHS England and the NHS on the one hand and the Department for Transport and GBR on the other. I do not believe that these examples are analogous. NHS England replicated functions in a way that did not serve the interests of patients or taxpayers who paid into the health service. The entire principle here is to take decision-making power from DFT, which under this broken system remains the only body truly accountable for what happens on the railway, and to give it to GBR, in a way that empowers it to ensure that services run in the public interest and represent value for money. I cannot envisage that Members across the House would not think it reasonable, within very broad parameters, to retain some ability to have political accountability in the fare-setting process in exceptional circumstances, such as during the pandemic. That is wholly sensible in making sure the railway continues to offer value for money for both passengers and taxpayers, who are ultimately one and the same.
Olly Glover
I understand what the Minister is saying, but if he means that the ability to give these directions would exist only in very extreme, exceptional cases, such as pandemics or large-scale wars, would he not be open to specifying that in the Bill?
Keir Mather
These direction powers, as drafted, replicate those in many other pieces of legislation, which are fit for purpose in making sure there is democratic accountability for the functioning of institutions, while not being overly onerous and overbearing. We see them with the Oil and Gas Authority, Great British Energy and Great British Nuclear. Only one direction has been given to the Oil and Gas Authority in the 10 years the legislation has existed. In government, the Opposition included the precise same direction power for GBR in their draft Rail Reform Bill, so they clearly believed it was necessary at the time. I therefore believe that it strikes an adequate balance.
Joe Robertson (Isle of Wight East) (Con)
The Minister says Great British Railways, not the Department for Transport, will run the railways. He says that is different from the set-up for the Department of Health and Social Care and NHS England. Was that not exactly the reason NHS England was set up, albeit not by his Government: to run the NHS so that the Department did not have to? I do not see the conceptual difference here at all; what I do is see the inconsistency in the Government getting rid of NHS England because that model does not work and bringing in GBR in the context of transport.
The Chair
Order. Before I bring the Minister back in, I remind colleagues that we are not debating NHS England.
Keir Mather
We may have to hash this out in our own time. There is a principle around the replication of functions between organisations. The principle of GBR is that once those decision-making powers are taken out of the Department for Transport—this is the single-mind approach to access decisions, charging and best use of the railway—there is not replication and burdensome inefficiencies in how those functions are designated and actualised by the different organisations. I believe that the difference lies in that point.
To return to my previous remarks, and on the basis of what I have explained, I urge hon. Members not to press their amendments.
Keir Mather
I sincerely thank the hon. Members for Broadland and Fakenham and for Didcot and Wantage for the amendments, which are about discounted travel for members of the UK armed forces, veterans, their families and the police.
On amendments 46 to 55, first and most importantly, the Government fully recognise the enormous contributions made by members of the UK armed forces, UK veterans and their families. I am pleased to confirm that there are absolutely no plans to change the existing range of discount schemes, including the veterans railcard and the armed forces railcard, which also covers family members of serving personnel. Those are valuable discounts for people who have sacrificed in the public interest, and the Government are rightly committed to them.
In our view, however, it is not necessary to reflect that commitment on the face of the Bill,. The Bill gives continued statutory protection to the discount schemes that are already protected by the Railways Act 1993 to ensure consistency for groups for whom cost has historically been a particular barrier to travel, to ensure that our railway continues to be inclusive and to be consistent with previous Acts. That does not mean that other discount schemes are not at the forefront of our mind and will not continue.
Rebecca Smith
I appreciate what the Minister is saying but, if that is the case, surely we should just remove the whole clause. If the Government do not seek to remove any discount schemes, why do they need three discount schemes, and none of the others, on the face of the Bill? It seems to me that there is a bit of a contradiction there.
Keir Mather
As I have just mentioned, we want to carry over those schemes to provide consistency for those groups. We are carrying over the role of the discretionary schemes as set out in legislation. We think that consistency is important but, for reasons that I will come to later, we also believe it is important that GBR is able to move in an agile way and think about evolving needs when it comes to concessionary travel. It is important, in terms of legislative carry-over, to ensure that that remains in place.
Jerome Mayhew
The Minister says that he wants GBR to remain agile, but does he foresee a situation in which it is agile by removing the veterans railcard? If he says no, as I suspect he will, why does he not put that on the face of the Bill and support our veterans?
Keir Mather
For the reasons I have just outlined. I have already confirmed that there are absolutely no plans to change the existing range of discount schemes, which include the veterans railcard and the armed forces railcard.
Jayne Kirkham (Truro and Falmouth) (Lab/Co-op)
Perhaps the Minister can confirm that the veterans scheme is incredibly important, that we all agree with it being there, and that there are absolutely no plans to remove it.
Keir Mather
Yes, I am very eager to agree with my hon. Friend.
This is a serious point. In my constituency, I see the difficulty that veterans have in attending Selby Abbey to mark the enormous contribution that people in our armed services have made across many conflicts. I would have thought that this is personal to every single member of this Committee, which is why I am pleased to agree with my hon. Friend.
Laurence Turner
Does the Minister agree that there is a comparison with the disabled persons railcard, the criteria for which have been significantly expanded? That change is due to be implemented over the coming months, and that has been possible only because there was not a restrictive statutory definition in primary legislation. Our understanding of disability has changed since the legislation was passed, and we would not want to restrict ourselves unnecessarily for the future.
Keir Mather
My hon. Friend makes an interesting point and is absolutely right to note that we want the concessionary schemes to be able to evolve to reflect the needs and lived experiences of those they are designed to help. I will expand on that point in more detail later.
I will make some progress now. We are of the view that minimising the number of listed discounts on the face of the Bill will enable GBR to develop and adjust discount arrangements over time, reflecting passenger needs and other objectives. For example, in the future it might be desirable to rationalise the existing concessionary offer for current and former military personnel and their families to ensure consistent terms and conditions between the armed forces and veterans. GBR should be able to consider such options but, if we enshrine the schemes in primary legislation, it will become virtually impossible to amend and improve them.
The Government remain fully committed to supporting the armed forces community through travel discounts and other means. For that reason, while I sincerely understand the motivation behind the amendments, the Government do not believe they are necessary and I ask the hon. Member for Broadland and Fakenham to withdraw them.
New clause 51 requires GBR to provide free travel
“to and from events that commemorate Remembrance Sunday.”
As I have said, the Government remain committed to all those who serve, and that includes supporting their attendance at events commemorating Remembrance Sunday. Last year, as in previous years, the Government worked closely with the rail industry to ensure that serving members of the armed forces and veterans were eligible for free travel to and from services of remembrance across the country. Likewise, Poppy Day volunteers and collectors—and their children—travelling to the London Poppy Day events were given complimentary travel to support their fundraising efforts on behalf of the Royal British Legion.
Rebecca Smith
I appreciate the Minister’s reassurance that there will still be opportunities for people taking part in remembrance events. However, there are additional matters such as the poppy train, which comes up through the south-west with Great Western Railway. While such things may be worked through in conjunction with the Secretary of State, they are put on by a privately owned franchise rail company. Is the Minister effectively saying that it will be down to the individual business units to decide what happens within their railway scope, or will it be in guidance through the licence or something else? There are many things that have been provided by privately owned franchises that the Bill does not confirm will take place once the railways are state owned.
Keir Mather
While I do not anticipate provision around the specific instance the hon. Lady described—for example the poppy train being frozen into the licence of GBR—I do expect that GBR will be minded and motivated to continue to ensure that members of the armed forces community, veterans and their families can attend Remembrance Sunday services across the country. In our view, concessionary travel more broadly will improve the ability to do that. It will allow GBR to set provisions in an agile manner through an evolving concessionary fares scheme, rather than freezing them as part of the Bill—and, moreover, to set provisions that are not already locked into legislation and do not therefore need to be carried over, in the interest of consistency for the groups that they affect.
Turning back to my remarks on Poppy Day volunteers travelling to events with their children, I do look forward to that policy continuing in the years to come, although precise arrangements for how that will work will be confirmed closer to the time. All that being the case, we do not see the need for legislative amendments. These are things that the Government and rail industry already strongly support and have been providing for many years. A regulatory framework would only complicate delivery, which is more effectively facilitated at the operational level, so, while we wholeheartedly support the spirit of new clause 51, I urged the hon. Member for Epsom and Ewell to withdraw it.
New clause 59 requires GBR to provide a scheme enabling free rail travel for police officers and police community support officers who are in full uniform or who are travelling for operational purposes. The Government gratefully acknowledge the service of police officers across the country and all that they do to keep us safe. The speed, skill and professionalism of the response by British Transport police and other brave first responders to the horrific train attack in Huntingdon last year is just one example of how police officers and all our emergency services save lives every day across our country.
While I understand the intention of the new clause in supporting that vital work, the Bill is not the correct place to set out the requirements for such a scheme. As the hon. Member for Didcot and Wantage knows, any new staff travel scheme should be the product of negotiations between the relevant organisations. To prescribe a scheme in primary legislation sidelines that process and risks the creation of a scheme that is not fit for purpose, as well as unfunded financial impacts to the railway. Therefore, while I am sympathetic to the intentions of the new clause, the Bill is not the appropriate avenue to establish such a scheme, and I urge the hon. Member not to move it.
Clause 34 ensures that GBR will be able to provide discount schemes, such as those offered today as railcards. First, the clause continues the 1993 Act’s statutory protection for young, senior and disabled passenger discounts. Prices are historically more likely to be a barrier to these groups’ accessing rail travel, and they are covered by the protected characteristics of age and disability. Maintaining these concession schemes in primary legislation supports equal access to employment, education and essential services. It is worth noting that, while other concessionary discounts are not included in the Bill, the Government recognise that they too are important, and there are no plans to withdraw any of the discounted schemes currently being offered.
Nevertheless, the clause also gives GBR the flexibility required to simplify and modernise discount schemes across the network, and to evolve the offer where that is considered desirable to meet passenger needs in the future. Finally, the clause ensures that devolved operators will still be required to offer the core statutory discounts, and that they will have flexibility over whether to participate in the GBR scheme or to create their own.
Jerome Mayhew
It is extraordinary that the Government say, on the one hand, that age and disability need to be included in primary legislation, but on the other hand that it is totally unnecessary to have the same security for veterans. We on the Conservative side of the House do not accept that logic and we will be pushing amendments 46 to 55, individually, to votes.
Question put, That the amendment be made.
Keir Mather
I thank the hon. Member for tabling the amendments, which would place a statutory duty on GBR and on Scottish and Welsh Ministers to ensure that discounted rail fare schemes are available for persons aged 26 to 30—I do not know whether I should declare an interest, as a holder of one of those railcards.
The Government have stated that there are no plans to change the existing range of discount schemes, including the 26-30 railcard, but we do not consider it necessary or appropriate to list specific age ranges in the Bill in the way proposed. Listing specific age ranges would be unnecessarily inflexible. The Government are absolutely committed to retaining discount schemes for younger people; however, much of the current discount system is fragmented due to its origin in the franchising system, so GBR may want to rationalise the existing range of discount schemes currently targeting younger people to simplify duplicative and overlapping offers and age ranges between 16 and 30, for example, as part of introducing a modernised, more consistent offer for passengers.
Given that Acts of Parliament are drafted to last a generation or more, placing specific age ranges in the Bill would likely remove those opportunities and potentially limit opportunities for young people. For those reasons, I urge the hon. Member to withdraw the amendment.
Jerome Mayhew
The Minister says that he wishes to have flexibility. The whole point is that we are trying to remove flexibility, so that GBR cannot take away discounts for 26 to 30-year-olds in the future. The Minister’s argument actually increases my concern that that is a realistic prospect in the Government’s mind, and I feel even more strongly that we should divide in order to ensure that discounts for 26 to 30-year-olds are protected in the long term.
Question put, That the amendment be made.
Edward Morello
I want to speak in support of new clause 13, tabled by my hon. Friend the Member for Didcot and Wantage. The new clause is our proposal for a rail miles scheme, as he eloquently laid out, but I want to add a couple of things. First, a rail miles scheme would encourage people to return to rail time and again, reward passengers for regular use and provide additional flexibility and discount. As has been outlined, we have seen existing or similar systems in respect of Eurostar, supermarkets and air miles, and, in certain cases, within the UK railway system.
It is worth stressing that, importantly, new clause 13 does not mandate the introduction of a scheme. It would require a report on how a customer loyalty programme could work in practice, boost passenger numbers and be designed to remain affordable and cost-effective for the taxpayer and the Government. All we ask for is an evidence-based review of rail miles as an important step towards a fairer system. As it is not a mandate but simply a request for the Government to look into the idea, the new clause should be relatively easy for the Government to support.
Keir Mather
Let me start by reasserting the principle that we do not want Ministers to be micromanaging the railway. However, the point about gin miles was very well made and I shall relay it to GBR.
Keir Mather
Well, there we are.
Let me start by responding to what the shadow Minister described as a probing amendment. He asked me to set out a little more detail on how we envisage the use of conditions on discounts, and I want to reflect the intent that he described. We want to ensure that eligibility for concessionary schemes and discounts is kept up to date, is reflective and is rationalised where necessary. A good example could be changing terms and conditions to change the eligibility criteria for the disabled railcard to include non-visible disabilities, which we have committed to in the accessibility road map. The intent to make sure that discounts are reflective of the lived experience of those who rely on them very much lies behind the provisions.
I thank the shadow Minister for tabling amendment 61, which would seek to remove GBR’s ability to set conditions on the use of discounted fare schemes. As drafted, the legislation will enable GBR to develop and adjust discount arrangements, if necessary, to reflect changing circumstances and passenger needs. More generally, it is worth noting again that the future framework on fares introduces clear and enforceable mechanisms that can be used to hold GBR to account, to ensure it delivers value for passengers and sustainable outcomes for taxpayers. Under this model, the Secretary of State will set parameters and guardrails aligned to GBR’s financial settlements. We believe that strikes an effective balance between strategic oversight and operational independence.
Railways Bill (Seventh sitting)
Keir Mather ExcerptsThursday 29th January 2026
(1 week, 3 days ago)
Public Bill CommitteesRead Full debate Railways Bill 2024-26 View all Railways Bill 2024-26 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Public Bill Committee Amendments as at 29 January 2026 - (29 Jan 2026)
Joe Robertson
I do. It is not difficult for me to agree and accept that the way Wightlink, which was part of British Rail, was dealt with was more than a missed opportunity; it was a bad decision. Locally, I work cross-party with the hon. Gentleman’s colleague, the hon. Member for Isle of Wight West (Mr Quigley) on that.
This Government have an opportunity. I thank the Minister for the work he is doing and I hope he will be prepared to intervene in a way no Government have done. There are clearly opportunities to make small improvements to the Bill, and accepting the amendments would do that not just in my constituency, but in others. I will leave the Minister with a question: if he does not support the amendments, how else might he use powers in the Bill, or would he be prepared to introduce amendments of his own, to improve connectivity for other modes of transport that do not have any formal regulation?
The Parliamentary Under-Secretary of State for Transport (Keir Mather)
Good morning, Mr Western. It continues to be a pleasure to serve under your chairship.
I thank right hon. and hon. Members for their contributions and for the clarity and succinctness with which they delivered them. I am afraid I will not be able to follow in their footsteps when responding to what is a chunky group of amendments and new clauses, so they will have to bear with me for this section of our deliberations. Clause 15 has been of considerable interest to members of the Committee and to the rail industry more generally, as we heard during oral evidence. I am thrilled that so much enthusiasm is being expressed for the strategy both verbally and in amendments, each of which I will now address.
Amendments 134 and 25 relate to the timing of the strategy. Amendment 134 would require the strategy to be set for 30 years. The Government have already confirmed that the strategy will cover a 30-year period. Setting that in legislation, however, is inflexible and unnecessary. Although the Government’s ambition is for a 30-year-long strategy, we need to provide for the ability to make reasonable changes to that term when needed.
Amendment 25 would remove the ability for the strategy to be amended within a 15-year period. That would fundamentally limit the railway’s ability to respond to unforeseen circumstances such as the covid-19 global pandemic. I hope the hon. Member for Broadland and Fakenham agrees that such a circumstance, or any number of other possible events, would clearly require the strategy to be revisited within a timeframe of less than 15 years.
Rebecca Smith
The Minister’s comments imply that a 15-year strategy would be fixed in concrete and could not be amended. I am assuming that the 30-year strategy will be fluid and flexible to take into account the circumstances that he has just mentioned, such as—God forbid—a future pandemic. I feel the way he has described the amendment is not entirely in the spirit of what was meant, so it is worth reflecting that. Ultimately, we all want a flexible railway; we are just trying to say that the strategy could last for 15 years instead of the current 30.
Keir Mather
I thank the hon. Lady for her intervention. My reading of the amendment is that it would remove the ability to amend the strategy within a 15-year period. Her broader point, about having flexibility to make determinations about the long-term rail strategy and cater for unforeseen events, technological innovations and global events that we cannot predict, strengthens the argument that we made about amendment 134, when we considered whether to set the period in stone and make it exactly 30 years. There has clearly been deliberation between the official Opposition and the Liberal Democrats about whether it should be 15 or 30 years, but we think that not being overly prescriptive is the best way to ensure that the rail strategy gives a long-term perspective and is sufficiently malleable to meet changing operational realities on the railway.
Jerome Mayhew
I just want to give the Minister some further clarity about what amendment 25 actually does. He is right that it says,
“The document issued under subsection (1) must be in force for a minimum of three control periods”,
but that should be read in the light of subsection (4), which gives the Secretary of State express power to
“keep the rail strategy under review”,
and paragraph (b), which says that they
“may revise or replace it.”
Does he accept that it is quite clear that the amendment, read in conjunction with subsection (4), does not prevent reacting to new events?
Keir Mather
On locking in a 15-year strategy that can be reopened only if the Secretary of State chooses to revise it, it has been said throughout our deliberations that we do not want politicians micromanaging the railway. I therefore presume that the Secretary of State would want to reopen the three control period review envelope only in extremis. Given our deliberations about whether it should be three control periods or 30 years, I think it is better overall to bake that flexibility into the Bill and allow those discussions to take place.
I have to make a lot more progress, and I do not want to detain the Committee for long. In the evidence sessions, several witnesses said that the ability to update and change the strategy in response to unexpected events is critical. No one can accurately predict things such as technological and environmental changes over the next 15 years. For that reason, the Bill has been drafted so that the strategy is not a once and done document, but can be revised when it needs to be.
The next theme in this group of amendments is to ensure that the long-term rail strategy includes specific content. Amendments 137, 207, 224, 135 and 136 all do that. The strategy will not go into specific operational requirements in the way sought by the amendments, which relate to topics such as rural railways, co-operation with local authorities, timetable integration, international rail and electrification. Those are all vital topics—of that there is no doubt—but they are all matters for Great British Railways to consider as it develops its strategic plan for the operation and optimisation of the rail network, informed by the long-term strategy.
Although I agree that co-operation with local authorities is critical to the success of this reform, I do not think that that objective needs to be captured in the long-term rail strategy. Rather, it is already captured in the Bill via GBR’s duty to co-operate with mayoral strategic authorities. That duty is provided for in legislation and will be enduring, so it does not also need to be in the strategy.
The suggestion that the long-term rail strategy should set out obligations relating to the timetable is in opposition to the views of the majority of stakeholders who responded to the Railways Bill consultation. They want Great British Railways to have the autonomy to manage the timetable without Government micromanagement, and I wholly agree with that.
Olly Glover
We seem to be losing track of the words that have been tabled. Either that or, like a group of management consultants, we are in danger of getting plans confused with strategies and tedious things such as that. Amendment 207 is neither intended nor drafted to encourage or enable the micromanagement of timetables. It is about the development of and the longer-term vision for what those timetables are supposed to achieve, and that is very much in line with what should be a 30-year strategy. I just want to assure the Minister on that point.
Keir Mather
I thank the hon. Gentleman for that assurance. I suppose that, in response to the amendments that he tabled, we agree that timetabling is of special significance because of the diffuse way in which it is currently organised between Network Rail and the Office of Rail and Road. We are conscious of the fact that making GBR a single driving mind for the railway means that timetabling needs to be dealt with in a way that is operationally responsive, but also not scattered throughout the Bill.
Although I agree with the hon. Gentleman about the importance of timetabling and having due regard for how it is implemented over the long run, I think the way in which the duties under clause 18 allow us to consider the best interests of passengers through that work has a necessary long-term impact on the timetabling process overall. I hope that that would be adequate in meeting some of the concerns that he outlines and seeks to address through the amendment.
Jerome Mayhew
I am grateful to the Minister, who is doing his job in highlighting some of the practical challenges that the amendment might entail. The important bit is not so much the strategy; I think what my hon. Friend the Member for Runnymede and Weybridge is trying to get at is that, when Network Rail or GBR assesses the function of a level crossing, it also needs to take account of the impact on the society in which it is based: for instance, cutting a town in two or stopping vehicular access for multiple periods during a day. Does the Minister not agree that, if GBR did not consider that—it was not in the list of considerations that the Minister mentioned a moment ago—it would not be doing its full job?
Keir Mather
I thank the shadow Minister for his intervention. I very much identify with the sentiment identified by the hon. Member for Runnymede and Weybridge. This is something that impacts Selby town, much as it affects communities across the country. It is right that GBR has regard to managing the way in which level crossings impact road users as much as it does the way that railway infrastructure and passenger services do.
My question is whether that obligation is best placed in this part of the Bill. Network Rail already has a system for considering the impact of changes on local communities, and that will be mapped over into the way that GBR functions. I believe that the transfer of that process, in a way that is reactive and operationally agile, is probably the best way to ensure that those considerations remain integral to how GBR carries out that work.
On connectivity and multimodal journeys, I am happy to confirm that strategic objectives in the long-term strategy will already include supporting better connectivity between communities. This will provide direction on the long-term trends affecting the railway. However, as with others in this group, amendment 261 would make the strategy a document focused on short to medium-term assessments of passengers’ ability to change between rail services or different modes—things that could change frequently, and are therefore not appropriate for inclusion in a document that sets out long-term strategic aims.
However, the hon. Member for Broadland and Fakenham will be pleased to hear that we will soon be publishing our integrated national transport strategy, which will set out the Government’s vision for domestic transport across England. It will focus on a transport network that works well for people across the country, including improving integration across modes, but I will of course take the sage advice of the right hon. Member for Melton and Syston about my personal role as part of that process.
Amendments 225 and 213 both seek to make the strategy subject to additional procedural requirements. Amendment 225 requires consultation with operators during preparation of the strategy. I can reassure the hon. Member for Broadland and Fakenham that the Government have already committed to consultative engagement with key stakeholders, including freight and passenger train operating companies, which will be essential for gathering evidence and informing the strategy’s development. Therefore, in our view, this amendment is unnecessary.
Amendment 213, meanwhile, requires regular reporting from the Secretary of State to Parliament on delivery of the strategy. However, as GBR will be the principal organisation responsible for delivering the vision and outcomes that will be set out in the long-term rail strategy, it will be for GBR to report on its progress in delivering it. GBR already must have regard to the strategy, and will respond to it through its business plans, on which it will report regularly. Given that and other existing reporting mechanisms, the amendment would be duplicative.
The new clauses in this group all propose new strategies or reports—for example, on rolling stock, cyber-security and technology, Sunday working arrangements or signalling. Those all naturally cut across the long-term rail strategy and, if accepted, would, in my view, risk GBR being busier completing strategies than actually running the railway. However, I would like to take each new clause in turn to give them due regard.
On new clause 27, the Government absolutely agree with the principle of a long-term rolling stock strategy. In fact, we would go a step further and say that this strategy should cover not just rolling stock, but the related infrastructure as well, in a single integrated strategy. Such a strategy was sadly lacking during the last three decades of privatisation, with decisions about rolling stock and related infrastructure taken to meet short-term and route-specific needs of operators seeking to maximise their profits. It is this Bill, establishing GBR, that will put that right.
However, I do not agree that the Bill needs this as a duty on GBR. Rather than creating a duty for GBR to deliver at some time in the future, we are already working with relevant parties across the industry to develop a rolling stock and infrastructure strategy to be published this summer. GBR will inherit that strategy and act on it to deliver improvements for industry, taxpayers and passengers.
Likewise, there is no need for a reporting requirement relating to cyber-security and technology. Cyber-security remains a priority for my Department; we are committed, through both existing cyber legislation and policy, to ensuring that GBR operates safely and securely. While new clause 28 reflects priorities that the Government share, the measures it proposes, such as on artificial intelligence, digitalisation and innovation, are already being delivered without the need to include them in this Bill.
On new clause 29, relating to Sunday working arrangements, I would first like to say that I have no doubt that creating GBR to improve both the quality and dependability of train services on Sundays will drive up demand and allow more people to benefit from the railway. We want a railway that operates reliably and sustainably, seven days a week, on a lower net subsidy than today, with built-in resilience and a diverse workforce. However, this is not an overnight change, but a long-term one, and not a process that, in my view, needs to be set out in legislation. Rather, we will continue to work with staff, managers and unions across the future railway to deliver this change collaboratively.
Jerome Mayhew
The Minister is touching on a key issue that the railway will have to address if he is serious about achieving a reliable Sunday service, and that is operating a seven-day schedule with a six-day roster. Does the Minister intend finally to address the six-day roster issue and to move working practices on to a seven-day roster?
Keir Mather
We want GBR to be empowered to address and deal with all these questions relating to personnel and timetabling in a way that is consultative and in partnership with both unions and private sector operators. My point merely remains that it is not appropriate to freeze them in aspic as part of this Bill, in a way that might prevent GBR’s ability to work properly through those considerations with the workforce once it exists. Producing a separate report on the demand for Sunday travel would duplicate the work that GBR already has to undertake through its business plan, which will set out the outcomes and key deliverables for GBR, including train service levels, which will be agreed with the Government and published accordingly.
Finally, new clause 54 relates to a signalling strategy, and again there is no need to place such requirements in this Bill. Network Rail has released its approach to digital signalling for 2024 to 2029, setting out the routes that will be converted to digital signalling. GBR will take over that approach and would be expected to develop it in its future business plans.
To bring the focus of the discussion back to clause 15, the long-term rail strategy will ensure that the railway will always have long-term direction from this Government and future Governments. Such directions are vital for stability and confidence within the rail industry. The strategy will help to prevent the constant short-termism that has been called out by both the industry and its supply chain.
I hope that, following my response to these amendments, the hon. Members will feel able to withdraw them, and I commend clause 15 to the Committee.
Sarah Smith (Hyndburn) (Lab)
It is a pleasure to serve under your chairship, Mr Western. My remarks will be incredibly brief, ahead of the Minister’s responses. To echo some of what my hon. Friend the Member for Truro and Falmouth said, as a representative of Hyndburn in Lancashire—which is currently not part of a mayoral combined authority—I look for reassurances that GBR will have regard to Lancashire’s transport authority and the local transport plans. This Government are clearly committed to the important agenda of devolution, but it would potentially undermine some of those efforts if in the transition phase—while we are trying to move as quickly as possible for as many areas as possible to benefit from that full devolution opportunity—a national body is undermining the local plans and those on the ground who understand the complexities of the needs of somewhere such as Lancashire. I would thank the Minister for reassurances in that regard.
Keir Mather
I thank hon. Members from all parties for their well-considered contributions to this debate. I shall endeavour to give full answers to them.
First, on the point made by the shadow Minister about how GBR will handle conflicting priorities that emerge within different strategies, as laid out by mayoral combined authorities or otherwise. As part of the business planning process, GBR will need to demonstrate how its integrated business plan aligns with the objectives contained in the long-term rail strategy and the Scottish Ministers’ rail strategy, reflecting the role that they have as funders of the network. The Bill also requires GBR to have regard to the various other national and local strategies. Fundamentally, however, establishing no hierarchy between the general duties to which GBR is subject, in my view gives the necessary flexibility to allow it to manage competing priorities where those may arise. It will be the responsibility of GBR to ensure that its decision making demonstrates consideration of potentially competing requirements and strikes an appropriate balance in making trade-offs.
On the statutory role of mayors as part of the process, GBR must have regard to their transport strategies. Mayors of course will have the right to request services and work in active partnerships with GBR. However, I also hear clearly the concerns of not only the hon. Member for South West Devon, but my hon. Friends the Members for Truro and Falmouth, and for Hyndburn about those who do not live in mayoral strategic authorities. I appreciate the hon. Lady’s scepticism when comparing this to our existing system. When it comes to engaging with private operators and with other arm’s length bodies, at the moment it feels as if parliamentary accountability cannot always be applied, and that where power resides is very diffuse, making it hard to tell who is responsible. We are actively trying to avoid and redesign that through the creation of GBR.
The hon. Member for South West Devon points to the fact that the business units might not have the teeth to engage properly and to reflect the needs of local areas, but I would say that we are creating a decentralised Great British Railways, where local areas are imbued with the powers to enter into dialogue with local authorities especially to avoid that being the case. That does not change the fact that the reason that within the Bill we have referenced mayoral strategic authorities is that we believe they are the right unit of economic and of demographic power to drive forward truly devolved change on the railway. That does not mean that we cannot not have regard to those who do not benefit from living within a mayoral strategic authority.
Keir Mather
I will give way briefly in a moment, but first I will build on the point that was made by my hon. Friend the Member for Bexleyheath and Crayford about how services can run across the boundaries of mayoral strategic authorities. Through GBR, we will be able to enter into processes that engage not only with a mayoral strategic authority, but with such authorities acting in a sense as a representative of pressures that exist in cross-border dynamics that may arise. That offers another useful lens through which to engage with local areas that do not have a mayor. I appreciate that the hon. Lady might want a little more reassurance, so I will give way.
Rebecca Smith
On those local business units, how large an area are they likely to be structured on? That has not been in the debate to this point, and may reassure me. I appreciate that that may be a detail that is coming later, but some indication of how many counties might be included within each business unit would help.
Keir Mather
The hon. Lady must have read my mind about that detail being forthcoming. If she will allow me to take away that specific point over the break that we are about to have, I might be able to come back to her when we resume the debate.
For the moment, I will quickly turn specifically to the amendments in the group. The lead amendment would require GBR and the ORR to “seek to achieve” the long-term rail strategy and devolved strategies, rather than to “have regard to” them. The existing wording deliberately reflects the nature of those strategies within the system. The LTRS will take a 30-year perspective and set strategic objectives, rather than define a narrow set of deliverables.
We of course want GBR and the ORR to have regard to the strategies in all decision making, but they must also have the flexibility to balance long-term objectives with the practical business planning processes that operate over fixed periods. To legislate that such a vision should be achieved would not be in line with that principle, or with the overall approach to the general duties that set the conditions for successful decision making, but do not dictate specific outcomes. As I have reminded hon. Members, GBR, not the Government, will be running the railway.
New clause 37 also relates to GBR’s delivery and looks to establish a statutory annual reporting framework. The Bill already provides robust reporting and accountability arrangements. GBR is required to produce an integrated business plan for each funding period, which must be published and kept up to date, and that will give Parliament and stakeholders a clear view of GBR’s objectives, activities and expected outcomes. A separate statutory annual delivery report would in essence duplicate that information. Furthermore, the ORR will have a role in monitoring GBR’s performance against its business plan and will provide independent advice to the Secretary of State. Such oversight ensures that GBR can be held to account without the need for an additional statutory reporting requirement.
New clauses 33 and 36 relate to GBR’s long-term approach to securing rolling stock. The former calls for the Secretary of State to publish a long-term rolling stock leasing framework and sets out a substantial amount of detail on what that should include. Within that detail, there are certainly points on which we can agree, including the benefits of longer leases and the proper consideration of whole-life asset costs, both of which have been made more challenging to achieve under the franchising model. However, I profoundly disagree that the Secretary of State should dictate the detailed approach that GBR should take to rolling stock leasing, and with the specific terms set out in the new clause. It is rightly for experienced industry professionals within GBR, guided by the Secretary of State’s long-term rail strategy, to secure the best value and achieve GBR’s other objectives through commercial arrangements with the rolling stock leasing market. It should not be for the Government to dictate the detail of those arrangements.
On new clause 36, I of course agree that GBR should have a long-term rolling stock and infrastructure strategy, which is why we are already working with parties across the industry to develop one. The strategy will be published this summer, and will remain a live document. GBR will inherit and implement it as soon as it is established. The new clause is therefore unnecessary, as by the time it would take effect, GBR will already be up and running with a long-term rolling stock strategy.
Amendment 218 would require GBR to have regard to the transport strategies of single strategic authorities. We are of course supportive of a more locally focused railway under GBR. The provisions in the Bill are pitched at mayoral strategic authority level, reflecting their growth across England, the vital role that mayors play in convening local partners and the scale and capability required to integrate rail into the wider public transport network. Nevertheless, all tiers of local government will benefit from empowered local GBR business units that are outward facing and actively engage local authorities on their priorities and local transport plans. That engagement will ensure there is sufficient opportunity for local authorities outside the mayoral strategic authority areas to collaborate with GBR on their priories and to consider proposals. I hope the hon. Member for Broadland and Fakenham therefore feels comfortable withdrawing the amendments.
Clause 16 places duties on GBR to have regard to the long-term rail strategy, devolved transport strategies and local transport plans. Overall, it seeks to ensure that strategic decisions on matters such as future services and infrastructure plans appropriately reflect national, devolved and local priorities. I commend the clause to the Committee.
Jerome Mayhew
This is now a common refrain in our deliberations. The Minister says, “Don’t worry. All these things will be taken care of at some future date in documents that have not been drafted and certainly haven’t been shared with the Committee.” With the greatest respect to him, I do not take it on trust that the Government are looking carefully and in sufficient detail at these matters, so I will press the amendments to a Division.
Question put, That the amendment be made.
Ivanhoe Line: Restoration
Keir Mather Excerpts(1 week, 4 days ago)
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The Parliamentary Under-Secretary of State for Transport (Keir Mather)
It is a pleasure to serve under your chairship, Ms McVey. I congratulate my hon. Friend the Member for North West Leicestershire (Amanda Hack) on securing the debate, and thank everyone for their contributions, including my hon. Friends the Members for Southport (Patrick Hurley), for Burton and Uttoxeter (Jacob Collier), and for South Derbyshire (Samantha Niblett), as well as the hon. Member for Strangford (Jim Shannon).
On a practical point, may I say that I will chase the correspondence that my hon. Friend the Member for North West Leicestershire referred to in relation to HS2? More broadly, I thank her for her work in advocating on behalf of her constituents and championing their need to have public transport that serves their interests. She rightly points to the fact that this Government believe that transport is not just a means of getting from A to B; it is a key way in which we fulfil the lives of people in the United Kingdom and connect them to greater economic opportunity and to their families. We will use the transport network as a catalyst for economic growth and for making sure that we have the housing people need. My hon. Friend appears to be laser-focused on those principles in her work and advocacy, and I thank her for that.
I am grateful for the passionate case that my hon. Friend made for reconnecting the towns of North West Leicestershire in the heart of the National Forest, such as Ashby-de-la-Zouch, Coalville and Swadlincote, with passenger railway services to Burton-on-Trent and Leicester —bringing back services lost in 1964 where only quarry freight services still operate today. Transport connections such as the ones that she mentions underpin the core missions of this Government, whether that means kick-starting economic growth, unlocking housing delivery, or breaking down barriers to opportunity to transform lives.
Our objective is simple but ambitious: to build a stronger, more connected transport network that works for everyone, wherever they live. We believe that local authorities are best placed to make decisions about the investment priorities in their areas, but too often, places such as North West Leicestershire have faced fragmented funding and limited flexibility. That is why, from April, we are providing all local transport authorities with more consolidated funding settlements, giving them the ability to align transport investment with local priorities and wider regional objectives, accelerating projects that matter most to their residents, businesses and visitors.
The Ivanhoe route cuts through Leicestershire, Derbyshire and Staffordshire. In Leicestershire, for example, this means that a total of more than £251 million of vital investment—across highways maintenance, active travel, electric vehicles, bus services and other local transport—will be delivered through consolidated funding by 2029-30. Elsewhere along the line, Staffordshire will receive £342 million, and the Mayor of the East Midlands will receive more than £2 billion by March 2032.
That said, I will take away the point, which my hon. Friend the Member for North West Leicestershire made very powerfully, about the disparities between funding in mayoral combined authorities and the local authorities that directly border them. That is something that we are working on through the Railways Bill, to create more democratic accountability, irrespective of mayoral arrangements. I think that point was very well made, and I will take it away from this debate. However, that settlement will support transport authorities, including those outside of MCAs, to strengthen their road, public transport, walking and cycling links between towns, cities and rural areas, and ensure that improvements are felt across the entire region.
Soon, we will embed that approach right across the country through our integrated national transport strategy. The strategy will champion transport that is designed, built and operated with people at its heart, recognising that different places face different connectivity challenges and therefore need different solutions, but also that they have different opportunities. My hon. Friend made an important point about the latent potential of the tourism industry in her constituency, and how the Government must work hard to realise it in partnership with her.
We want to focus on making transport safer, more reliable and more accessible, giving more people confidence in the network and confidence that it will work for them. Crucially, we will also align transport more closely with housing and with public services, recognising that poor connectivity entrenches inequality, while good connectivity expands opportunity.
I commend the work of my hon. Friend in championing the case for reinstating passenger services on the Ivanhoe line, building on previous work to assess the viability of the scheme. While the Chancellor took essential steps to help balance public finances in 2024, closing the previous Government’s unfortunately unfunded commitments in the restoring your railways programme, we welcome transport authorities using local funding to develop the business case for their important local priorities. Indeed, authorities can work with Network Rail to develop and present business cases and investment proposals for consideration through the rail network enhancements pipeline, the Government’s funding portfolio for rail upgrades, at any stage of development. That process ensures that funding decisions are affordable and represent good value for taxpayers.
The Government are also keen to facilitate third-party investment in railway infrastructure that could support local development and housing plans. I urge local transport authorities to make best use of the funding we are making available to them, and to make the right decisions for improving transport connections across all modes, for Ashby, Coalville, Swadlincote and elsewhere.
Recognising the importance of improving transport connections in the wider midlands region, the Chancellor committed in the July spending review to progress to the next stage of the midlands rail hub, which will unlock thousands of homes and drive economic growth, with better connections and more reliable journeys for passengers. The first phase will create capacity in central Birmingham to improve reliability and enable additional trains both locally and to Worcester, south Wales and the south-west. We are working closely with Network Rail to ensure passenger benefits as soon as possible. Depending on future investment decisions, the later phases of the rail hub would also mean major benefits for the east midlands, with extra trains between Birmingham, Derby and Nottingham, including possible stops at Burton-upon-Trent and between Birmingham and Leicester.
East Midlands Railway’s new bi-mode Class 810 Aurora trains have already started to enter passenger service on the midland main line through Leicester and will continue with a phased roll-out through 2026. These new trains will bring a step change in the customer experience and will support growth. Once all those new trains are up and running, they will provide a 46% uplift in capacity, with more seats and carriages.
To conclude, today’s discussion has been an opportunity to reflect not only on the case for the restoration of the Ivanhoe line but on this Government’s priorities for improving transport connections to help people get about and to access the opportunities they deserve, and on how we can support local authorities in the east midlands to deliver on the transport priorities of their communities.
Although I feel that I may not have been able to answer the noble and ambitious aspirations that my hon. Friend the Member for North West Leicestershire has put forward today, I encourage her to keep the conversation going and to continue to hold DFT Ministers’ feet to the fire on this most important of issues. She is a tireless champion on behalf of her constituents and of their ability to get where they need to go, realise economic opportunity and lead richer, more fulfilled lives. I encourage her to continue in those efforts and I will watch with interest as she does so.
Question put and agreed to.
Railways Bill (Sixth sitting)
Keir Mather ExcerptsTuesday 27th January 2026
(1 week, 5 days ago)
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Jerome Mayhew
Thank you, Mr Western, and for agreeing to be in the Chair this afternoon. We are part-way through consideration of the schedule, with a degree of overlap: amendment 109 was selected in a separate group to this one, although its wording is intricately linked to that of amendments 110 to 116. I shall try to minimise the degree of repetition for all concerned.
The amendments in this group seek to constrain the Secretary of State’s ability to modify the licence of Great British Railways without first seeking consent from the Office of Rail and Road and the passengers’ council. The Government’s strategy is for the Bill to be the legislative shell for the creation of GBR. Crucial matters of detail, such as the licence under which GBR will operate, together with important long-term strategies, business plans, targets and so on, which we have mentioned more than once in our deliberations so far, are separate from the Bill.
That detail matters and deserves proper scrutiny by this Committee and elsewhere in the Houses of Parliament. When the Rail Minister and his officials appeared before the Transport Committee on 7 January, Members took several attempts to secure an assurance that the draft licence would be published before Parliament completes scrutiny of the Bill, albeit without a specific date set. It is therefore important to include in the Bill stronger checks and balances than exist now, and that is the purpose of amendments 110 to 115.
At present, the Bill merely requires the Secretary of State to consult the ORR. Legally, that is of course very weak and, after such consultation, the Secretary of State may simply ignore whatever it is that the ORR comes up with. Amendments 110 to 112 therefore require the Secretary of State to obtain the Office of Rail and Road’s agreement for the licence to be issued, and amendments 113 to 115 require the Office of Rail and Road’s agreement for the licence to be modified.
In addition, modification of the licence requirements would need consent from the new passenger watchdog. If the passenger watchdog is to be as powerful in championing the interests of passengers as the Government claim they want it to be, it requires proper powers that go beyond an invitation to be consulted. That leads me to amendment 118, which would leave out line 6 on page 56 of the Bill and would strengthen the right of the ORR to grant a licence to a non-GBR operator.
The schedule contains important powers for the Office of Rail and Road to issue licences to operators other than GBR to operate services on the network. However, proposed new section 8(5)(a) in paragraph 3 of the schedule gives the trump card to the Secretary of State, who must consent to the granting of such a licence. Why is that power of veto required? Perhaps the Minister will explain when he responds.
If the Government wish to reduce their involvement in the day-to-day running of the railways and the Office of Rail and Road deems that an application from a non-GBR operator meets all the requirements and conditions set out in the Bill, why do the Government think it necessary to have that overriding power? It does not appear to make sense. Amendment 118 would remove that power of veto. The group of amendments, together, would require the Secretary of State to obtain a formal recommendation from the Office of Rail and Road, and would require that the GBR licence adequately ensures that licence obligations relating to safety and standards are not compromised or undermined. The amendments would ensure that, as GBR is granted new responsibilities by the licence, it continues to be subject to safety standards obligations that are in the licence issued by the Office of Rail and Road to the current infrastructure manager, Network Rail.
Such licence obligations go beyond obligations under the Railways and Other Guided Transport Systems (Safety) Regulations 2006—which are called ROGS for obvious reasons—and would require Great British Railways to participate in the industry’s collaborative structures around collective decision making, managed by the Rail Safety and Standards Board, and comply with safety and interoperability standards set collectively by the sector, including for freight and supply chain.
For those reasons, this group of amendments, taken as a whole, would provide important strengthening of the role of the ORR. I look forward to hearing the Minister’s response.
The Parliamentary Under-Secretary of State for Transport (Keir Mather)
May I begin, Mr Western, by saying what a pleasure it is to serve under your chairship? I thank the hon. Member for Broadland and Fakenham for tabling this group of amendments. I shall discuss amendment 233 with amendments 110 to 112, which I believe all share the same intent. Provisions to require the agreement of the ORR and the passenger watchdog before the Secretary of State issues the GBR licence would add an additional and unnecessary level of bureaucracy. If the amendments intend to ensure that the ORR and the passenger watchdog can constructively input into the licence, I assure the hon. Member that the Bill already requires the Secretary of State to consult the ORR and the passenger watchdog, and to invite representations more widely, before the licence is issued. If the amendments were accepted, it would no longer be clear who had the right to determine the terms of the licence. It is only appropriate that, following full consultation, the Secretary of State, as the licensing authority, has the sole final sign-off of the licence. The ORR will then, of course, enforce that licence. That is consistent with the clear accountabilities that the Bill establishes. We therefore cannot support the amendments.
On amendments 113 to 116, GBR will not need to apply for a licence, therefore the amendments’ provisions would apply only in relation to non-GBR licences. In any case, the amendments would add unnecessary complexity to the process for making licence application regulations. The amendments also intend to give an approval role to the ORR and the passenger watchdog in relation to modifications of GBR’s licence. The Bill already requires those bodies to be consulted before the Secretary of State modifies GBR’s licence. Again, requiring approval rather than consultation would risk confusing the clear accountabilities that the Bill establishes.
Amendment 118 seeks to strengthen the ORR’s ability to grant non-GBR licences. Under the Railways Act 1993, all licences are granted by the ORR with the consent of the Secretary of State. In practice, that consent is normally given in advance through a general authority, avoiding the need for case-by-case approval. The Bill does not change that aspect of the licensing regime. Removing the provision for specific Secretary of State consent, as the amendment intends, would not meaningfully strengthen the ORR’s ability to grant non-GBR licences. Non-GBR licences could still only be granted within the scope of a general authority approved by the Secretary of State.
In fact, the amendment would remove a useful route that enables the ORR to issue a licence outside the scope of a general authority or in circumstances where amending a general authority would not be practical. Far from strengthening the ORR’s ability to issue non-GBR licences, the amendment would instead likely weaken it.
Finally, amendment 126 would require the ORR to agree to GBR’s business plan before it is approved. I agree that the ORR provides invaluable input as an expert, independent regulator and it must have a robust role in the determination of GBR’s business plans. That is why the Bill gives it an explicit role to run the funding process, provide advice on the business plan and validate the costs within it, and independently publish its advice, whether that advice is supportive or critical of GBR.
However, it is not appropriate for the ORR, an unelected body, to decide how public money is allocated to the railway. Public spending decisions at this level should sit with elected Ministers who are responsible for funding the railway. I hope the hon. Member for Broadland and Fakenham can see this Government’s commitment to a robust and independent role for the ORR, but it is clear that the ORR can fulfil its role assuring the business plan without needing to be a funding approver to do so.
Further, the ORR will have an expanded monitoring role though the powers in the Bill, being able to monitor all GBR’s activities against its business plan. If GBR does not deliver on its plans, the ORR will be able to publish its findings, as well as escalating the matter to the Secretary of State. The ORR will be a trusted expert adviser to the Secretary of State, combining the strengths of an expert regulator with the need for the Government to control taxpayer money.
I encourage the hon. Member for Broadland and Fakenham to withdraw the amendment, and not to press the others in this group to a vote.
Jerome Mayhew
I listened with interest to the explanation the Minister gave and his request that the amendment be withdrawn. I was particularly interested to hear him describe the role of the ORR as a “trusted expert adviser”. In my submission, when we have GBR as the player and referee in many of the areas it will be active in, with a designed-in conflict of interest, we need more than a trusted expert adviser to hold the Government and GBR to account; we need an independent regulator. That is exactly what the ORR currently is.
I intend to press amendment 233 to a vote and, dependent on the outcome, I will not proceed to press amendments 110, 111, 112, 118, 114 and 115 as they address similar wording in other parts of the Bill. However,but I will seek to press amendment 126 to a vote if we get the opportunity to do so this afternoon.
Question put, That the amendment be made.
The Chair
With this it will be convenient to discuss the following:
Clause stand part.
New clause 26—Great British Railways: funding review—
“(1) Thirty months after the commencement of any five-year period covered by a funding settlement for Great British Railways, the Secretary of State must publish a review of Great British Railway’s funding.
(2) The review set out in subsection (1) must include figures for—
(a) funding allocated to;
(b) ticket revenue raised by;
(c) amount of government subsidy received by;
Great British Railways.
(3) A copy of the review must be sent to the Transport Committee of the House of Commons.
(4) References in this section to the Transport Committee of the House of Commons—
(a) if the name of that Committee changes, are references to that Committee by its new name, and
(b) if the functions of that Committee (or substantially corresponding functions) become functions of a different Committee of the House of Commons, are to be treated as references to the Committee by which the functions are exercisable.”
This new clause adds statutory transparency to rail funding cycles.
New clause 34—Great British Railways: Certainty of Funding—
“(1) Within 12 months of the passing of this Act, the Secretary of State must publish a funding certainty framework for Great British Railways (‘the Framework’).
(2) The purpose of the Framework is to establish and maintain terms for the funding of Great British Railways.
(3) The terms of the Framework must include provision that—
(a) The Secretary of State may not vary, reduce, or reopen the funding settlement for an active Control Period, unless either—
(i) a statutory provision made after this Act amends Great British Railway’s duties requiring funding revision, or
(ii) an emergency has been declared within the meaning of section 1 of the Civil Contingencies Act 2004;
(b) the Secretary of State must publish—
(i) the confirmed funding determination,
(ii) the assumptions underpinning it, and
(iii) any exceptional circumstances to justify any adjustments,
within an active Control Period;
(c) the Secretary of State must agree the funding for the next Control Period not less than two years before it is due to start;
(d) when determining the funding settlement for a Control Period, the Secretary of State must take into account—
(i) the Long-Term Rail Strategy,
(ii) Great British Railway’s duties, and
(iii) whole system planning considerations across infrastructure, passenger services and freight;
(e) The Secretary of State must work with Scottish Ministers to align as far as possible funding determinations so that Great British Railways receives a single, coherent, funding determination no less than two years before the relevant Control Period starts.
(4) The Secretary of State must lay before Parliament a report on—
(a) any funding determination for each Control Period;
(b) any exceptional revisions of the funding determination for a Control Period within that Control Period;
(c) whether the Office of Rail and Road, or any other relevant body, has met any relevant deadline to confirm funding for the next Control Period, and where it has failed to do so, the reasons for that failure.
(5) Nothing in this section amends or removes the ability of Office of Rail and Road to carry out Periodic Reviews for each Control Period.
(6) The Secretary of State must annually lay before Parliament a report on—
(a) the stability of Great British Railways’ funding;
(b) the effect of any instability on—
(i) the efficiency of,
(ii) delivery of services by, and
(iii) management of risks associated with projects run by, or associated with,
Great British Railways.
(7) For the purposes of this section, ‘Control Period’ has the meaning given in any final decision taken by the Office of Rail and Road which concludes each periodic review of access charges as described in Schedule 4A of the Railways Act 1993.”
This new clause would require the Secretary of State to prepare a Funding Certainty Framework, with funding for each Control Period set two years before it is due to start, to enable Great British Railways to plan effectively.
New clause 39—Great British Railways: financial duties—
“(1) Great British Railways has a duty to ensure that its operating expenditure does not exceed its operating income in each financial year (‘the duty’).
(2) The duty does not apply to capital expenditure aligned with national infrastructure investment and enhancement pipelines.
(3) Within 12 months of the passing of this Act, the Secretary of State must provide guidance to Great British Railways about its duty under subsection (1).
(4) This duty must include guidance about—
(a) operational income, including fare revenue, access and charging functions, commercial income, and non-fare revenue streams;
(b) operational expenditure, including staffing, operations, support, maintenance, rolling stock operation, management and renewals; and
(c) the exclusion of capital expenditure aligned with national infrastructure investment and enhancement pipelines.
(5) Great British Railways has a duty to ensure its business plan and operational decisions have as a priority its long-term fiscal sustainability within the objectives set out in the rail strategy.
(6) In meeting its duty under subsection (5) Great British Railways must seek to increase its revenue.
(7) For the purposes of subsection (6), ‘revenue’ includes—
(a) fare revenue through passenger growth,
(b) commercial retail income,
(c) income from property, station and land commercialisation,
(d) freight access revenue, and
(e) market expansion.”
This new clause puts duties on Great British Railways to ensure its operating expenditure does not exceed its income, and to deliver long-term fiscal sustainability. It makes further provision relating to those duties.
New clause 40—Great British Railways: non-reliance on taxpayer funding—
“(1) Within its first operational Control Period, Great British Railways must set out a transition plan towards ending any reliance on taxpayer funding.
(2) The transition plan under subsection (1) must identify—
(a) any efficiency improvements Great British Railways can make, and
(b) any cost-reduction measures necessary for Great British Railways to operate in such way as does not rely on taxpayer funding.
(3) For the purposes of this section, ‘Control Period’ has the meaning given in any final decision taken by the Office for Rail and Road which concludes each periodic review of access charges as described in Schedule 4A of the Railways Act 1993.”
This new clause requires Great British Railways to set out a plan towards ending any reliance on taxpayer funding.
New clause 41—Great British Railways: annual statement of financial performance—
“(1) Great British Railways must publish an annual statement of its financial performance, including—
(a) its operating income and expenditure,
(b) whether it achieved operating cost self-reliance,
(c) the reasons for any failure to achieve operating cost self-reliance,
(d) where it has failed to achieve operating cost self-reliance, any actions it will take in the next financial year to achieve it, and
(e) an assessment of its compliance with its duties under section [Great British Railways: financial duties].
(2) The Secretary of State must lay the annual statement before Parliament.
(3) The Office of Rail and Road must review Great British Railway’s performance as set out in the annual statement, and publish an assessment of whether Great British Railways is meeting its efficiency and revenue targets.
(4) Where the Office of Rail and Road concludes that Great British Railways has not met its duties under section [Great British Railways: financial duties], a Minister of the Crown must make a statement to each House of Parliament setting out—
(a) the reasons for Great British Railways’ failure to meet its duties, and
(b) any corrective action to be taken by—
(i) the Secretary of State, or
(ii) Great British Railways.”
This new clause requires Great British Railways to publish an annual statement on its financial performance, and for the Office of Rail and Road to assess that performance.
New clause 44—Great British Railways: savings target—
“(1) The Secretary of State must publish a savings target for each financial year for Great British Railways.
(2) The Secretary of State—
(a) must keep the target under review,
(b) may revise or replace the target, and
(c) must publish any revision or replacement to the target.
(3) Great British Railways must, when exercising its statutory functions, have regard to the target set by the Secretary of State under this section.”
This new clause requires the Secretary of State to set a savings target for Great British Railways.
Keir Mather
Clause 12 establishes a new funding process for GBR that takes what we have learnt from the successes of the periodic review process today and applies them to the new GBR world. That new funding period review will not only provide GBR with five years of funding to carry out its job of operating and maintaining the railway network, but will create a structure through which GBR will develop and own integrated business plans, across track and train, that reflect its role as the directing mind for the railways. That five-year funding certainty will help to drive the best price for Government and the taxpayer, through lower risk and the benefits of economy of scale. It will also generate consistent, longer term work for private partners in the rail supply chain, keeping good, well-paying specialist jobs alive and thriving.
Jerome Mayhew
Clause 12 is an enabling clause. It is very short and merely refers to schedule 2, so I make no representations to change it and shall not seek to divide the Committee on it.
Rebecca Smith
That is a very long time ago. Under privatisation, the unions have done a very good job. In my constituency in the south-west, there are no seven-day contracts, for example. If I want to get a train up from my constituency on a Sunday, those trains are cancelled quite regularly, because the service relies on the good will of the staff to do overtime to make the train even come up to London.
Whatever we do, we need to look carefully at the terms and conditions that will be brought forward into this new public body. Up to this point, it has been down to each individual company to negotiate. That has been done with highly professional and competent union representatives, but we are not on a level playing field at the moment. As a member of the public, I want to be sure that those public sector staff are not receiving undue recompense for what they are doing, which would not be in accordance with other public sector bodies.
Private companies have been expected to give their staff a huge amount of benefits—quite rightly; that is their choice as private companies. If the staff become public sector, things like free rail travel need to be on the table. We must at least acknowledge those issues and make a decision to continue them, rather than assuming it is a given, which is down to unions to negotiate.
There is no conversation in the Bill about that TUPE-ing across of staff members. Value for money is really important. We do not want inequality being built into our public sector workforces simply because we are renationalising something.
Subsection (7) of new clause 39 provides that we should be showing where revenue comes from. That is absolutely justifiable. The private companies that will continue to operate in the railway system will have all that information available to their shareholders—to the people they are reporting to. If Great British Railways does not show that information, there is, again, no opportunity for scrutiny. If commercial retail income is flopping because GBR is not doing a very good job, we have no way to hold it to account for that. I do not see why it should be frightened to share that revenue information. It should instead see this as an opportunity to show good practice and how things could potentially progress under GBR.
I have one more point, which came up right at the end of the Select Committee hearing—I managed a question to the Minister, Lord Hendy, but have not seen a response. There is a huge amount of land and value that belongs to these railway stations, currently run by private companies, in some cases, including for things such as parking. What happens with all that income and all the opportunities for Great British Railways to potentially make some money? How will we know about that money and where it is coming from? New clause 39 seeks to bring that information to the fore and ensure that it is transparent and in the public domain.
Turning to new clause 40—this might be something of a segue, but I am going take the opportunity to put it on the record anyway—there is something about the aspiration to move from heavy taxpayer-funded reliance that speaks to the devolution conversation that we have been having. We have had multiple conversations, and I am sure we will have more, but ultimately GBR is being set up to give more powers to certain local authorities and local areas if they wish it, which is great—we want those communities to be able to control more of what happens. However, as we have been discussing, we are effectively developing a two-tier system, whereby anyone who is not in a mayoral authority will effectively be paying into the railway company and GBR, but not necessarily getting the levers to effect change locally. The Minister has reassured me that that will be done through business units and so on, but given that we do not know the scale of those business units or which regions and communities they represent, it is important that we know how that taxpayer money is to be used for funding across the country.
There has been a huge amount of storm damage in the south-west this weekend. Where will the funding come from under the new GBR? The south-west is not a mayoral strategic authority. Will we get our fair share of funding through the set-up for GBR? New clause 40 sets out the aspiration to move away from taxpayer funding and would surely create a more equitable system for the future.
Finally, new clause 44 would introduce a savings target. My hon. Friend the Member for Broadland and Fakenham has been alluding to the point about the costs we currently see in the system, particularly around infrastructure. That has certainly come up in the Transport Committee, in terms of how much it costs to build a bridge or a new station and the lack of competition and challenge. The new clause would create an opportunity to ensure that we pay as little as possible for the best outcomes. We have had lots of evidence in the past few months to show that other parts of the world can produce the station infrastructure that we need for a lot less than we are paying for it. I believe that is down to how the system currently works, and new clause 44 would force us to look at how it could work under GBR.
Keir Mather
I thank Members for tabling amendments on GBR’s funding and financial framework. In this chunky group of important amendments and new clauses, I first turn to new clause 26, tabled by the hon. Member for Didcot and Wantage, which would require the Secretary of State for Transport to publish a mid-funding period review of GBR’s funding, and new clause 41 from the shadow Minister, which seeks to create a GBR annual statement of financial performance.
In my view, the Bill already creates sufficient transparency about how GBR is funded. Further process could constitute unnecessary bureaucracy. Under paragraph 7(2) of schedule 2, the Secretary of State is already required to publish details of the financial assistance given to GBR using the funding period review funding power. Under paragraph 5 of schedule 2, GBR must publish its business plan and keep it up to date throughout the five-year period. Between those two commitments, the Transport Committee of the House of Commons will already have key information about how much funding the Secretary of State is providing to GBR, and the details on GBR’s business plan to understand what GBR is doing with its money. It would be unnecessary and inefficient to conduct an extra review.
New clause 34 would require the Secretary of State to set funding two years in advance of the funding period. First, I believe that it is misplaced to require that funding be committed two years in advance. There will inevitably be changes to economic circumstances over a five-year period, and new projects will surface. That was well acknowledged by all the witnesses at the oral evidence sessions, including those representing the railways supply chain. If there is no practical discretion, a settlement agreed two years in advance will be redundant before it even starts.
I can also assure the hon. Member for Broadland and Fakenham that the Bill already accounts for the need to provide the railways with certainty, and ensures that the funding process completes before the start of the next five-year funding period. The ORR, which will run the process, intends to set deadlines so that funding is committed in time for the industry to prepare. Secondly as with new clause 26, new clause 34 seeks to introduce additional reporting requirements that are unnecessary, given the transparency requirements already provided for in the Bill.
I now turn to new clauses 39 and 40. New clause 39 would create a duty for GBR to achieve value for money and long-term fiscal sustainability. New clause 40 would require GBR to develop a transition plan toward ending any reliance on taxpayer funding within its first operational funding period. I agree with the hon. Member for Broadland and Fakenham that GBR must deliver as efficiently as it can, ensuring good value for money and reducing costs to the taxpayer, and I assure him that the Bill is already very specific about GBR’s achieving value for money. Clause 18(2)(f) includes a specific legal duty on GBR and the Secretary of State to take into account
“the costs that will need to be met from public funds and the need to make efficient use of those funds”.
The ORR must also provide advice to the Secretary of State on whether GBR’s estimated costs in GBR’s draft business plan represent good value for money, with a requirement to publish a summary of that advice as part of the funding process. That is before the Secretary of State signs off on the business plan. Therefore, the hon. Member’s intent is already achieved by the Bill, and the amendment would only create extra bureaucracy and inflexibility without adding to transparency or financial sustainability.
A statutory transition plan to eliminate taxpayer funding would be unrealistic, and would undermine the railway’s ability to achieve its social goals. The reality is that taxpayer subsidy will always be needed for some parts of the railway. For example, while we aim to have the most profitable and efficient network possible, there will always be some lower-population regions of the UK in which rail travel will not make a profit and will need taxpayer subsidy. Clearly, it would not be appropriate for the Government to withdraw funding and neglect connectivity in those important rural regions, whether that be in Devon, Dorset or elsewhere—constituencies represented by Members across the Committee. Rapidly forcing GBR to operate without public support would be devastating for the economy and for the mobility of the public, not to mention reducing efficiency and the long-term capacity of the network.
Finally, new clause 44 would require the Secretary of State to set and publish an annual savings target for GBR. Introducing a statutory savings target risks creating a rigid measure that might not reflect the operational realities of the railway. Efficiency is already embedded in the Bill’s framework and will be a key consideration when GBR publishes its business plan and sets out how to meet its objectives, including on efficiency. Statutory targets are therefore not required to drive performance.
Edward Argar (Melton and Syston) (Con)
In the context of efficiency and cost, I want briefly to pick up on a point made by my hon. Friend the Member for South West Devon. What assessment have the Government made of the financial cost of bringing together a whole range of diverse terms and conditions and salary structures, from multiple train operating companies, into GBR?
Keir Mather
When it comes to setting up the operational structure of GBR, including questions about workforce and staffing, it is fair to say that no piece of railway legislation for 113 years has specified in statute what the operational decisions will be. Those conversations are ongoing, as they have been while rail companies have been taken into public ownership through DfT Operator, and they are always held, I am pleased to say, in close consultation with the workforce and trade unions.
On the overall principle of cost, I would point out to the right hon. Member that the Department’s view is that establishing GBR is set to cost £200 million to £400 million overall—which is 1% to 2% of a single year of operating budget—but could unlock up to a billion pounds-worth of efficiencies across the rail sector. Value for money is not only baked into the legal duties under this legislation, but is part of GBR’s operational ethos.
Laurence Turner
I again draw the Committee’s attention to the fact that I am a member of Unite the union. Does the Minister agree that changes to terms and conditions, if they happen at all, often take place on a very long-term transitionary basis? Indeed, that is my understanding of what happened the last time that the railways came under public ownership, when many people remained under pre-1948 terms and conditions for several decades. I would not wish to make assumptions or pre-judge future discussions, but can he confirm that nothing in the Bill would prevent similar transition arrangements in future?
Keir Mather
As my hon. Friend rightly highlights, questions about the operational structure of GBR have been left outside the framework of this Bill. That is precisely to allow those conversations to continue and so that the legislation can be fit for the creation of a railway system that works for the long term.
I thank hon. Members for their contributions, but would encourage them not to press their amendments.
Question put and agreed to.
Clause 12 accordingly ordered to stand part of the Bill.
The Chair
I remind Members that decisions on new clauses are usually taken after decisions on existing clauses and schedules, even though we may have just debated them—one for a future day.
Schedule 2
Funding Great British Railways
Edward Morello
As always when following my hon. Friend, I find myself with little to add. All of the very good points have been made, but it is probably worth reinforcing why we think amendments 216, 147 and 215 are important.
Amendments 216 and 215 speak to an absurd anomaly. I am probably unusual in this Committee in that I am not a rail expert—far from it—but the absurdity of not having aligned funding cycles for passenger and infrastructure strikes any outsider as madness. As somebody who regularly travels on the Salisbury to Exeter line, which is in need of electrification and new rolling stock, I ask any Minister who is responsible to tell me when the operator should make a decision on whether to buy new rolling stock, when they do not know whether electrification is going to happen. Do they wait for the electrification and then buy the rolling stock, having just spent all this money extending the life of diesel carriages? Having the two interoperable is just common sense. I would hope that making the two funding cycles run simultaneously would be a non-contentious idea.
On amendment 147, my hon. Friend the Member for Didcot and Wantage gave the example of the outbreak of war, which is definitely an extreme one, but we must also insulate any piece of legislation against future politicians—Ministers—wanting to meddle and perhaps not adhering to the desire that it was designed around. The amendment is intended to make sure that Ministers, whether in the Department for Transport or the Treasury, cannot rip the funding carpet out from under the rail operators. If the Bill really is about long-term planning, then there has to be long-term security of funding as well, and amendment 147 is about making sure that there is an additional safety net should any future Government, of any make-up, not want to adhere to the spirit of the Bill. For those reasons, I hope the Government will give consideration to our amendments.
Keir Mather
I thank the hon. Member for Broadland and Fakenham for tabling amendment 119, which would require the Government to commit funding for a five-year funding period at least two years before the period starts. I can appreciate and identify with his desire to provide certainty to industry, and agree with the ambition that the amendment presents to generate a stable operating environment for the railway. However, as I said in response to new clause 34, I believe that the desire to require funding to be committed so far in advance is misplaced. There will inevitably be changes to economic circumstances and new projects will surface. If there is no practical discretion, a settlement agreed two years in advance may be redundant before it starts.
I can assure the hon. Member that the Bill already accounts for the need to provide the railway with certainty and ensures that the funding process completes before the start of the next five-year funding period.
Jerome Mayhew
I heard what the Minister said, but it flies in the face of the evidence that the industry itself gives him and all of us about the need for certainty towards the end of a control period. All that the amendment seeks is certainty for two years at the start of a control period. How is he going to address that particular issue?
Keir Mather
It is of course our obligation as the Government to meet the concerns of stakeholders, whether raised in the oral evidence session or elsewhere. It is also incumbent on me to point out that we want to abolish boom and bust in the rail system. On the fear about cliff edges, as was acknowledged by the ORR in its oral evidence, in reality there is not a cliff edge when funding always tends to run over the five-year period. Five years is the basis for the decision process by which funding allocations must take place. It is important to take the oral evidence in the round. It is also important to note that the ORR, which will be running the process, intends to set deadlines so that funding is committed with time for the industry to prepare. The amendment is therefore unnecessary.
Amendments 129 and 147 both seek to prevent or restrict the Secretary of State’s ability to vary the agreed funding settlement. I assure Members that the intention of providing a five-year funding commitment is that it lasts for five years. The Government are signed up to that principle. I also agree that certainty for GBR and industry is beneficial. More funding will mean we can get the best out of the railway and encourage investment, innovation and value for money.
Putting a hard restriction on all change, as amendment 129 suggests, would not be proportionate, as the shadow Minister acknowledged. As he noted, there may be unforeseen circumstances that require changes to funding, either to provide more or to reduce the amount. For example, GBR may outperform expectations and need less than is awarded, in which case Ministers will need to recoup the costs for the taxpayer, and can choose to do so in whatever way they see fit.
Keir Mather
Indeed! The operating environment may also change and GBR may need more funding than is committed. It is right that elected Ministers are able to make decisions on public spending and allocate resources as needed, balanced against the clear benefits of certainty.
Amendment 147 would restrict Ministers’ ability to vary funding by adding a requirement that the ORR must provide written consent. Although the Office of Rail and Road will have an important advisory role, it would not be appropriate for it to entirely determine changes to funding. Responsibility for decisions of public expenditure must remain with the Secretary of State, particularly where changes may be required due to wider fiscal circumstances. The amendment would also result in ORR consent being needed for increases in funding and immaterial changes.
The Bill provides assurances. If the Secretary of State considers that the impact of a funding reduction could be material, the Bill requires her to notify the ORR, giving it an opportunity to comment publicly on the likely effects on the railway. That balances the need for the Government to retain control over Government funding with the opportunity for independent evaluation and, if needed, public pressure, to protect certainty for the railway.
On amendments 215 and 216, I thank the hon. Member for Didcot and Wantage for so ably setting out, based on his practical experience, and far better than I ever could, the need for a single guiding mind for the railway. His explanation was buttressed by the right hon. Member for Melton and Syston. I thank the hon. Member for Didcot and Wantage for his amendments, which seek to align passenger service funding within the five-year infrastructure funding cycle. I support that intention. The Government agree that many benefits are derived from integrated funding streams. However, I do not agree that the amendments are necessary.
It is important to note that passenger services are already fully considered under GBR’s statutory duties and through the integrated business plan, in which GBR will plan all its activities on a five-year basis across track and train. The Bill requires GBR to deliver safe, reliable and efficient services, taking passenger needs into account.
Jerome Mayhew
GBR may plan on a five year basis, but it is not the same five years, is it?
Keir Mather
The shadow Minister is right to point out that allocation of funding for passenger services, as opposed to other GBR activities, initially takes place through the spending review funding process. I am about to address his point, but I should say that the Bill contains the ability for Ministers to extend the five-year funding process to passenger services once GBR is set up and prepared to manage that. It would not be responsible to do that from the outset when GBR is still in the transition and set-up phase. Ministers need to feel confident that GBR is financially mature enough before they can consider integrating funding further. I hope that addresses both the shadow Minister’s point and the contribution from the hon. Member for Didcot and Wantage.
Olly Glover
I understand what the Minister is saying, but I am sure that in his line of work he has already encountered many instances where, despite noble intentions for something to perhaps happen at some point in the future, it ends up being years, if not decades, before it does. That is why it would be rather more sensible to enshrine the requirement in legislation.
Keir Mather
Respectfully, I believe it is more sensible to be prudent and cautious regarding the funding of passenger services, rather than risk creating a situation that a newly created GBR might not be in an immediate position to sufficiently accommodate within its operating structure. Erring on the side of caution, I encourage Members to withdraw their amendments.
Jerome Mayhew
As I intimated earlier, amendments 119 and 129 are probing and I will not press them to a vote.
I was interested to hear the Minister’s apparent position that there is no boom and bust, that the current situation for infrastructure funding is fine and that the evidence from the industry appears not to be—
Keir Mather
For the record, I said that we shared the aspiration to abolish boom and bust as it exists within the rail system. That applies to our infrastructure as much as it does to any other part of the railway’s operation.
Jerome Mayhew
I am grateful for that clarification, but although the Minister may share that ambition, he is not choosing to do anything about it. Having said that, I said I was not going to press the amendments to a vote and I will not. I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Keir Mather
I thank the shadow Minister and the hon. Member for West Dorset for their amendments, all of which look to amend the Secretary of State’s statement of objectives.
First, amendment 120 would require that the statement of objectives contains standards for GBR to meet when conducting its railway activities. I agree that we need to measure GBR’s performance against clear standards to ensure high-quality delivery. However, the statement of objectives, which is a document to set direction and inform the funding process, is not enforceable, and consequently it is not the right place to require standards.
The original drafting provides flexibility, letting the Secretary of State specify what standards should be achieved by GBR when delivering against the objectives in the statement. This allows for circumstances in which providing a standard helps to better articulate the strategic vision for GBR over the five-year funding period.
However, it may not always be appropriate for an objective in the statement of objectives to be accompanied by a standard, particularly when an objective is straightforward or high level, such as a requirement to have regard for security threats or to support economic growth. The Bill contains other mechanisms, including the business plan and the licence, to ensure that there are robust and enforceable measures against which to hold GBR to account.
There is a similar case to be made on amendment 121, which seeks to set a structure for the statement of objectives, and amendment 123, which proposes to expand the list of potential objectives to include a section on productivity and efficiencies. The amendments would change the list from illustrative objectives to a set of requirements. It would fundamentally not be appropriate to impose such a structure on the statement of objectives, which needs to be able to take a different approach each time it is made, in response to wider environmental concerns and socioeconomic circumstances. The intention is that the list serves as a guide to future drafters, and I believe that the flexibility to allow adaptation to circumstances that we cannot predict will ensure that this legislation remains fit for purpose into the future.
Joe Robertson (Isle of Wight East) (Con)
I understand, although I do not agree with, the argument the Minister is making on amending “may” to “must”—he says it would be unenforceable—but he seems, unless I have misunderstood, to have conflated that argument with his point about amendment 122, which seeks not to make a discretionary provision a mandatory one but to expand the considerations. The explanatory statement says:
“This amendment would require the Secretary of State to set the objective for…increasing passenger and freight journeys.”
Perhaps I have misunderstood.
Keir Mather
To my knowledge, I am not conflating the two amendments. My point is that setting objectives that are so closely tied to discernible and prescriptive standards would, in effect, contravene the original intention of the schedule, which is to provide flexibility in setting objectives over the five-year period. If, in the hon. Gentleman’s view, I continue not to meet that intention, I will happily give way again.
Jerome Mayhew
The Minister wants flexibility, and he says that is why amendments 123 and 206—tabled by myself and the hon. Member for Didcot and Wantage respectively—should not be agreed to. Will the Minister set out the circumstances in which he thinks it would not be appropriate for the organisation to focus on
“delivering improved productivity and efficiencies”
or on
“customer experience and satisfaction”?
Why does he need flexibility to ignore those objectives?
Keir Mather
No, I am not willing to say that those objectives, in principle, should not be pursued as a result of this legislation. The question is where within the Bill these things reside. If we are talking about short-term objectives relating to GBR’s operational efficiency as an organisation through, say, a key performance indicator, that is best placed within the business plan. If we want legal duties to ensure that we improve passenger experience or the reliability of train services, they are best placed as legal duties. There is a question about where we apportion the responsibilities and accountability mechanisms within the Bill. I do not believe that schedule 2 is the right place to be as prescriptive as the shadow Minister intends with those specific requirements.
On amendment 123, there is already a mandatory requirement in the Bill for the Secretary of State to obtain advice from the ORR on whether the activities that GBR is to undertake represent value for money. Unlike the list of potential objectives, that is mandatory. I also direct the Member to the assurances that are already in the Bill: there is a duty on GBR to make efficient use of public funds when exercising its functions, and a clear role for the ORR to assess the value for money of GBR’s proposed plans and to publish that assessment.
Edward Argar
Will the Minister confirm that the advice it will be obliged to seek will be published? If it is private advice, it has no teeth whatsoever, because the Secretary of State could accept it or refuse it, as could GBR, and no one would ever know. Would that advice be public?
Keir Mather
The purpose of issuing advice is so that we can enter into an era for the railways where these discussions happen in a way that is far more commonplace than the broken-down patterns of accountability that currently exist. I therefore envisage the sort of adversarial situation that the right hon. Member suggests occurring less than it does under the existing rail system.
The ORR and the Secretary of State are both required to consider value for money when they advise on and approve the business plan. I hope that the relevant measures will show the hon. Member for Broadland and Fakenham that we are serious about getting the best out of GBR and provide him with enough reassurances to seek to withdraw his amendment.
Amendment 122 would specify that the Secretary of State’s statement of objectives may include an objective on increasing passenger numbers and freight. It would narrow the wording of the objective in paragraph 2(3)(a) of schedule 2 from relating to passengers and freight to just increasing the numbers of those things. I do not think it would be wise to require ever-increasing passenger numbers as an objective in itself. Different objectives—such as increased reliability, improved passenger experience or references to spare freight paths—might contribute to that overall outcome while being more important in the moment. Again, that should be for the Government of the day, not inflexible legislation, to decide. I urge the hon. Member for Broadland and Fakenham to withdraw his amendment.
Finally, amendment 206 proposes to expand the list of potential topics that could be covered in the statement of objectives, with the hon. Member for Didcot and Wantage suggesting the inclusion of a section on customer experience and satisfaction. The current list in the Bill is purely illustrative, so Secretaries of State may in future add to the list of topics, and include just some of the topics or slightly different ones in their statement of objectives. I invite the Committee to note that the illustrative objectives already included in the Bill contain reference to the carriage of passengers or goods, as well as to fares and accessibility—all matters that are important to passenger experience—so it is unclear what more would be achieved through the amendment, which would simply add a further example to the list.
Furthermore, the Bill contains a duty for the Secretary of State and GBR to exercise the functions in the manner best calculated to promote the interests of the users and potential users of railway passenger services. Unlike the list of potential objectives, that duty is intended to be mandatory. I hope that demonstrates to the hon. Member for Didcot and Wantage that we consider passenger experience to be absolutely central to GBR’s objectives, and provides him with enough comfort not to press his amendment.
Jerome Mayhew
We have heard with interest what the Minister has to say, but I am wholly unpersuaded that he is adequately reflecting the needs of the industry, so I will seek to press amendment 120 to a Division.
Question put, That the amendment be made.
Jerome Mayhew
We now turn to paragraph 4 of schedule 2, which deals with the business plan and approval by the Secretary of State.
To receive public funding under paragraph 4, GBR is required to include in its business plan an explanation of how it will meet the objectives set by the Secretary of State. Amendment 124 seeks to strengthen this obligation by requiring GBR to set meaningful KPIs against which its performance and meeting its statutory duties—as set out in clause 18, which we will come to in a bit—can be measured. We had the saga of the missing licence; now we have the saga of the missing KPIs—and 19 other documents. This is important, given the absence of any direction from the Government on KPIs, despite being repeatedly requested on the Floor of the House over a number of months. The only response from the Government as a result of that probing is that they will be “robust”, whatever that means, hence the need for amendment 124.
Amendments 125 to 128 would strengthen GBR’s focus on minimising the cost to the taxpayer and increasing the role of the Office of Rail and Road to make sure that that happens. Amendment 125 would require an express focus on how plans will minimise costs to the taxpayer, which is too often overlooked—the Bill makes hardly any reference to value for money. The taxpayer is ignored entirely. This amendment would make it a legal requirement to address that and would—under the maxim that “you get what you measure”—drive behaviour.
Amendment 127 would require the Office of Rail and Road to provide an assessment of whether GBR’s plans to minimise costs to the taxpayer are, in fact, likely to do so. That would be undertaken before the Office of Rail and Road approves the business plan. Again, this is about driving behaviour through focus and making sure that the taxpayer is not forgotten in the deliberations between nationalised Great British Railways and civil servants at the Department for Transport.
Finally, amendment 128 would require GBR to publish its full business plan, save for commercially sensitive sections, which they should of course have a carve-out from displaying to their potential competitors—although most of their competitors have been designed out under the wording of the Bill. Amendment 128 would welcome transparency, which—given the huge amount of public funding that the organisation currently requires and no doubt will continue to require—is necessary, so that the public can see how their money is being spent, and whether the organisation is focused on driving down the cost to the taxpayer and driving up value for money.
I commend all the amendments to the Minister.
Keir Mather
I thank the hon. Member for the amendments, which seek to add requirements to the production of GBR’s business plan and the ORR’s advice on that plan. However, on the subject of the publishing of advice, I briefly return to a question that was put to me by the right hon. Member for Melton and Syston. I feel that I was unnecessarily circumspect in the answer that I gave him, and it did not reflect the incisive nature of his question, which was about a mandatory requirement that exists in the Bill for the Secretary of State to obtain advice from the ORR on whether the activities of GBR represent value for money, and whether or not that advice can be published. I tell him that the ORR must publish a summary of that advice, and it can publish the advice in full. Although I do not wish to predict the future, I expect that it will likely to so, as part of its work in holding the Government to account. I hope that that is a full answer for the right hon. Member.
Edward Argar
I thank the Minister very much. I cannot imagine where that flash of inspiration and recollection came from, but I am grateful to him for the clarification.
Keir Mather
Committees move in mysterious ways—that is all I will say.
I will take each amendment in the group in turn, starting with amendment 124, which would require GBR to develop key performance indicators for each of its statutory duties. I am sure the hon. Member for Broadland and Fakenham will agree that KPIs should be realistic and measurable, so they would also need to be grounded in the specific proposals for what GBR intends to deliver over the next five years. They also need to be allowed to evolve over time, to ensure that they are most relevant to GBR’s planned delivery and can be effectively used to track GBR’s progress.
The way an indicator is set out can influence how an organisation behaves, and we should be able to refine them over the course of several funding periods, to get GBR to deliver in the way that it needs to. Therefore, a more flexible process works better than fixing the nature of the indicators in legislation—and I give way to the hon. Member.
Jerome Mayhew
The Minister is a mind reader; I was just about to ask him to give way. He says he cannot agree to amendment 124 because we need flexibility in the future, but he will see that it refers to
“measurable performance indicators for each statutory duty listed in Section 18”,
so that flexibility would only run so far as any alteration to the statutory duties set out in his own clause 18, which GBR has no ability to change. The Government do not intend for there to be flexibility, so why does the Minister say he needs it?
Keir Mather
I respectfully disagree with the shadow Minister’s interpretation. This is about how GBR discharges those legally binding duties, and whether we should be overly prescriptive about the means by which it does so. It is important to have flexibility. Given the amount of technological change that we have seen in railway processes over recent decades, as well as socioeconomic factors and the need for GBR to balance those duties, we cannot be overly prescriptive about how we ask it to meet them—apart from the fact that it is legally required to do so.
I assure the hon. Member that GBR’s business plan will have not just a robust but a comprehensive set of KPIs against which it will be held to account. Progress against them will be tracked, and GBR will publish updates in line with the requirements in the Bill. The ORR will also monitor GBR and its business plan, and provide advice to the Secretary of State.
Rebecca Smith
I am thinking through the schedule. Forgive me if I am wrong, but ultimately, it is GBR’s business plan. Effectively though, there are going to be wheels within wheels, in terms of each of the business sectors, the different mayoralties, and the operators that are doing different things in different countries. To me, it feels overly simplistic: we have got one plan, which is the plan for the funding of the entirety of GBR, but if there are no KPIs at all, how are we supposed to even compare parts of the country against each other? Surely there will be different funding streams and business cases for different things. To me, it just feels like one overarching plan. How on earth are we supposed to hold the Government to account for delivering that, let alone ensuring parity and equality across the country, and making sure that funding is going into the right places, where it is most needed?
Keir Mather
That is a very important point. While the hon. Member points to a system that is simple in the objectives that it sets out for the railway overall, I see one that provides sufficient breadth to allow the organisation to develop over time and offer a system of operation that is closer to the communities it seeks to represent—and which, most importantly, is agile in adapting to changing socioeconomic circumstances and technological innovation.
The need for objectives that are not overly prescriptive, and the place for KPIs being in the business plan, allows a holistic approach to setting objectives for the railway, which can guide work overall for a national organisation, offering a single uniting mind, while at the same time not fettering GBR’s ability to evolve as an organisation in future.
In that sense, I believe we desire the same outcome: to make sure that the railway operates in the most effective way possible. In the light of the measures in the Bill that I have outlined, I hope that the hon. Member for Broadland and Fakenham will withdraw the amendment.
Amendment 125 would require GBR to include in its business plan information about how it will minimise costs to the taxpayer, while amendment 127 would require the ORR to advise the Secretary of State on this. I agree that it is important for GBR to deliver in the most efficient way that it can. That is why GBR, the ORR and the Secretary of State—all the people involved in the railway, and in the business plan—are all subject to a cost and efficiency duty, which is applied by clause 18. That will ensure that GBR aims to be cost-efficient at all times, which aligns with the intent of amendment 125.
Adding additional requirements for GBR in this space could create perverse incentives. For example, a focus on minimising costs, without other checks and balances, could drive GBR to cancel unprofitable lines even if they are important to local communities because doing so will save money. Clearly, it would not be appropriate for GBR to neglect connectivity in those important rural regions. GBR will also be robustly scrutinised from a value-for-money perspective by the ORR, and the Secretary of State will need to consider the ORR’s advice before approving GBR’s business plan. I hope that is enough to assure the hon. Member for Broadland and Fakenham that the Bill can deliver the outcome he seeks without amendment, while allowing GBR the autonomy necessary to plan in the way it sees as most appropriate.
Finally, amendment 128 seeks to limit the information that GBR could redact from its approved business plan. I agree that GBR’s activity must be transparent, and that will be an important part of how we hold GBR to account. That is why the Bill already requires GBR to publish its business plans. The Bill provides for slightly more discretion for GBR to redact sections of the business plan than amendment 128 proposes. That is because it is important that all types of sensitive data, not just the commercially sensitive, are able to be protected. Personal data, security-sensitive information about stations or anything legally privileged are all examples of content that may need redaction from the final plan. A flexible requirement can be better used to navigate these nuances. However, let me be clear that GBR’s public law duties and wider accountabilities framework will ensure that GBR will not be able to hide information that is important and relevant to public scrutiny.
In the light of these considerations, I ask the hon. Member not to press the amendments.
Laurence Turner
On amendments 125 and 127, I have full sympathy with the ambition of reducing costs to the taxpayer wherever possible. However, the word “minimise” is important here, because a natural reading would be to bring that cost to a minimum.
Each Government have recognised that there is a balance to be struck between the charges raised against the taxpayer, fare payers and other users of the railway. We heard evidence from Richard Bowker, the former chief executive of the Strategic Rail Authority, who has contributed what is sometimes known as Bowker’s law—there are only two sources of income to a railways: passengers and taxpayers.
I fear that if these amendments were incorporated into the Bill, the natural outcome would be that fares would rise, as indeed may charges levied upon freight users of the railway. For that reason, I hope they are not supported.
Keir Mather
Schedule 2 will establish a new funding process for GBR that takes what we have learned from the successes of the periodic review process and applies them to the new GBR world. The new funding period review will provide GBR with five years of funding to carry out its job in operating and maintaining the railway network, and will create a structure through which GBR will develop and own integrated business plans across track and train that reflect its role as the directing mind for the railways.
The schedule retains the role of the ORR in testing and scrutinising the plans, ensuring they are ambitious but deliverable, and providing confidence to the Government. The new funding process, with the five years of certainty it provides, will help to result in the best price for Government and the taxpayer, and generate consistent, longer-term work for private partners in the rail supply chain—keeping good, well-paying, specialist jobs alive and thriving in the United Kingdom.
The schedule will also give greater representation to devolved Governments and mayoral strategic authorities, providing them with a real opportunity to advocate for the countries and places they serve at the national level. The funding period review will provide GBR with the structure it needs to set out how it will make our railways reliable, offer better value and be more accessible. I therefore commend schedule 2 to the Committee.
Edward Argar
I will not detain the Committee for long. As ever, I am grateful to the Minister for his succinct explanation. However, I have two concerns; while he may be able to reassure me on these, I certainly think they need an airing. First, how does he propose to ensure that the funding period is properly aligned with a spending review period? I have seen the challenges faced in government when there is a misalignment, or where one period overlaps the other.
I was only very briefly Chief Secretary to the Treasury, but I have also been a Minister in a spending Department, and I have seen the challenges that occur when there is a misalignment, because the Treasury is very clear about non-commitment beyond an existing comprehensive spending review period. How will the Minister ensure alignment and certainty? Without alignment, although there is the impression of certainty, we all know the all-powerful hand of the Treasury if one, as a spending Minister, cuts across its bow on such matters.
The other challenge has been raised by my hon. Friend the shadow Minister a number of times in various contexts. Although I take the point about the five-year period—and the Minister referenced seeking to bring greater certainty to investment decisions with that—I am still not quite clear. I may have missed it, but I do not think I have heard a clear explanation of what steps are being taken to iron out the peaks and troughs that my hon. Friend the shadow Minister mentioned, because it is still a five-year period.
Unless the budget is set for the next five-year period in, say, year two or year three, well ahead of its coming into force—I would posit that the Treasury would be highly unlikely to agree to that—it still does not get around the problem: year one is scaling up, we might see spending in years two and three, and possibly in a bit of year four, but then that spending will drop off again due to a lack of certainty about what is coming in the next year one. I would be grateful if the Minister could clarify how what he sets out in the schedule will help to address the peaks and troughs that my hon. Friend the shadow Minister so ably highlighted to the Committee previously.
Keir Mather
I thank the right hon. Member for Melton and Syston for his contribution. He is right to note that the five-year funding process has a different period from that of the spending review. It is tested in the sense that the funding process for Network Rail works similarly now. As was acknowledged in the oral evidence from the ORR, there is not in reality a cliff edge through the five-year funding settlement, as funding always tends to roll over the five-year boundary, but five years is the envelope through which those decisions take place.
That is my assessment of how the process works; if I have failed to answer any of the right hon. Gentleman’s questions, perhaps he will illuminate me on what they are and I can provide him with a more fulsome response later on.
Question put and agreed to.
Schedule 2 accordingly agreed to.
Clause 13
Charging and terms and conditions
Jerome Mayhew
I beg to move amendment 22, in clause 13, page 7, line 22, leave out “as it thinks fit” and insert “as are reasonable”.
This amendment would ensure Great British Railways only charges what is reasonable for provision of services in circumstances where it is a monopoly supplier.
Rebecca Smith
I want to briefly speak to the proposed new subsection added by amendment 23, which would offer anybody given conditions by GBR the opportunity to appeal that decision to the Office of Rail and Road. The issue of accountability and the unequal playing field faced by those on the outside compared with those on the inside came up in the Transport Committee’s evidence sessions and last week. Having heard a lot of that evidence, the amendment appeals to what I think is the right way to do things. We must ensure that organisations engaging with the railway, or offering services to the railway—even if they are being paid separately for them—have the opportunity to appeal a decision that affects or impacts them. I feel that not having such an opportunity is particularly onerous. I support amendment 23 and concur with everything that the shadow Minister has said.
Keir Mather
I thank the shadow Minister for tabling amendments 22 and 23 and the hon. Member for South West Devon for speaking in their support. Amendment 22 seeks to require GBR to set reasonable charges for the delivery of its functions, and amendment 23 seeks to require the ORR to provide an appeals role for anyone who considers the charges set by GBR to be unfair.
On amendment 22, we clearly agree that GBR must act reasonably when setting charges and there is no suggestion that it will not do so. In fact, safeguards to ensure that GBR cannot levy unreasonable charges already exist in the Bill. Clause 18 requires GBR to act in the public interest and to ensure that railway service providers, such as devolved operators, freight operators and open access operators, can plan, invest and make decisions about their own businesses. When setting charges, GBR must therefore do so in a manner consistent with those duties, and it must not set charges that undermine operators’ ability to run viable and successful businesses.
Jerome Mayhew
The Minister refers to clause 18(2)(e), which states:
“They must exercise the functions… in the manner best calculated to be in the public interest”.
Can the Minister not see that GBR’s assessment of what is in the public interest could very well be what it considers to be in its own interest, because it is a public body? The provision would allow GBR to prioritise its own interests, such as the increased receipt of revenue from third-party operators, at the expense of the competition. That is not the safeguard that the Minister says it is, is it?
Keir Mather
I disagree with the shadow Minister’s interpretation of how the duties function in this regard. GBR cannot take a wholly self-interested, cynical interpretation of what constitutes “best use” under clause 60, which we will turn to in due course. GBR has to make a best-use decision that takes into account the needs of open access and freight. Also, under GBR’s duties, it must take account of promoting the interests of users and potential users of the railway, some of whom—even though open access constitutes a small proportion of the railway network usage overall—will be people using open access operators. Further, the duty in clause 18(2)(d) says,
“so as to enable persons providing railway services to plan the future of their businesses with a reasonable degree of assurance”.
Such persons would not be able to do so if they were being levied unreasonable charges.
There are supplementary safeguards that I will turn to. Existing competition legislation will also require GBR to ensure that the charges it sets are fair, non-discriminatory and not anti-competitive. The ORR will retain its enforcement role in consumer and competition law, concurrent with the Competition and Markets Authority, so it will be able to ensure that GBR is treating the private sector fairly. It is also important that, as a public body, GBR must be able to recover appropriate costs from those who benefit from the services that it provides. If it were prevented from doing so, the burden would ultimately fall on taxpayers and passengers. The Government’s ambition is to have a successful rail industry that attracts investment and can support its own costs, rather than unnecessarily relying on the taxpayer.
Amendment 23 would introduce an appeals role for the ORR on these charges. Again, we fully support the principles of fairness and transparency that underpin the amendment. For significant charges, such as charges for access and the use of infrastructure, the Bill already provides an appeals route to the ORR. However, an appeals route to the ORR for every possible charge that GBR may levy in relation to its statutory functions is clearly disproportionate. The amendment would require an appeals route to be provided even when those charges may be small, such as contributions to cover a railcard cost.
Clause 13, in its sum, simply ensures that GBR can recover the costs of managing and delivering services, such as back-office retailing services, by charging those who use GBR services, such as non-GBR operators or retailers. It is essential that GBR should have a clear statutory right to recover costs from users of its services. That supports the sustainability and efficiency of GBR’s operations, and ensures that taxpayers and GBR customers are not subsidising the operations of others. Importantly, it replicates how those cross-industry functions are paid for today. The Bill and existing competition law already provide adequate protections for third parties and a route of redress, should that be required. I urge the hon. Member for Broadland and Fakenham to withdraw his amendment and commend clause 13 to the Committee.
Jerome Mayhew
The Government’s defence is pretty extraordinary. What they are saying is that GBR should be free to charge unreasonable amounts—otherwise there would be no objection to the wording of the amendment, which simply seeks to put the word “reasonable” into the requirement. The Government say that even though this monopoly provider can charge as it thinks fit, there should be no specific right of appeal and that the other operators should rely on the CMA taking an interest or on wider competition law—in other words, after-the-event litigation.
We all know that in a business environment we can argue about the chaos at the end, but a business can already have been destroyed by a decision from a monopoly provider—on which there is no right of appeal and which could not be held back until an appeal has been heard. This is an absolute charter for GBR to run roughshod over independent retail operators, open access operators and even rail freight. It is with no hesitation at all that I seek to push for a vote on both the amendments.
Question put, That the amendment be made.
Keir Mather
In today’s system, the ORR can require Network Rail to pay a fee to cover some of the costs of the ORR’s railway activities; that is done via Network Rail’s licence. The clause will ensure that, in the future system, the ORR will continue to have the independent funding it needs, by allowing it to require a similar fee from GBR. That ensures that the ORR will continue to operate in an impartial and independent way—a crucial part of enabling it to provide high-quality advice to railway funders and to conduct its role as the access appeals body fairly. I commend clause 14 to the Committee.
Jerome Mayhew
So here we are: this is the eminently sensible approach to providing funding for the ORR to continue its operations as a safety regulator. Clause 14 allows the Office of Rail and Road to require GBR to pay a levy to the ORR for performing its non-safety railway functions. That provides the ORR with a legally guaranteed funding source independent of the Secretary of State or Government. The provision aims to provide the ORR with a stable and predictable funding stream that will enable it to plan and carry out its activities. Those were remarkably similar words to the ones used by the Minister—I wonder why!
What I have described replaces the current system under which the ORR requires Network Rail to pay a fee for it to perform its non-safety functions via the process set out in the Network Rail licence. The ORR, as we all know, is an independent regulator, so decisions on its funding should be kept separate from organisations that have a vested interest in its decisions, which is why GBR, despite paying the levy, will not determine the amount. The amount is agreed between the ORR and the Treasury and then provided by GBR through this levy.
This is one of the few clauses through which the Bill is not actively diminishing the role of the ORR. Instead, it provides the ORR with a legally guaranteed funding source, independent of the Secretary of State or Government—save, obviously, for its negotiations with the Treasury. The aim of that is to provide the ORR with a stable and predictable funding stream that will allow it to plan and carry out its duties successfully. That duty already exists in the Network Rail obligation, as I have already mentioned.
I am glad to see from the Government’s explanatory notes on the clause that GBR will not determine the amount of the levy, which will be agreed between the Treasury and the ORR. It seems that the Government do understand the concept of partiality and bias, but are prepared to admit that only when it comes to certain clauses in the Bill.
Keir Mather
I thank the shadow Minister for his support—slightly barbed support, but support nevertheless. I have nothing further to add. I commend the clause to the Committee.
Question put and agreed to.
Clause 14 accordingly ordered to stand part of the Bill.
Clause 15
Rail strategy
Olly Glover
I beg to move amendment 134, in clause 15, page 8, line 18, at end insert
“for the next 30 years for”.
This amendment would ensure that the rail strategy set out in Clause 15 must cover a 30-year period.
Railways Bill (Fifth sitting)
Keir Mather ExcerptsTuesday 27th January 2026
(1 week, 5 days ago)
Public Bill CommitteesRead Full debate Railways Bill 2024-26 View all Railways Bill 2024-26 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Public Bill Committee Amendments as at 27 January 2026 - (27 Jan 2026)
Jerome Mayhew
My hon. Friend is entirely right. That will be a theme of our comments on and challenges to the Bill throughout the progress of our scrutiny: accountability without responsibility is no accountability at all. Time and again, we see an unwillingness from those who drafted the Bill to trust the role of parliamentarians as scrutineers.
As a former businessman, I know—I have not made this one up; it is not unique thinking—that, in any organisation, you get what you measure. That will have been the case in any organisation that hon. and right hon. Members may have worked in in the private or public sector: the NHS has targets because it gets what it measures. At the moment, the Bill measures very little on GBR’s performance, and where it does, that disappears off to the Department for Transport and is reported to other civil servants.
As parliamentarians, we know our value in holding not only GBR to account but the Government of the day, which will not always be a Labour one. That is our important role, which is done through the Select Committee process and more widely. As parliamentarians, we should seek to improve the Bill. I recognise that we will have a number of Divisions during this process and I am unlikely to win a single one, but I urge the Government to listen—perhaps to the private comments of its own Committee members; they do not have to tell me about it—because these are genuine areas of improvement that we as parliamentarians should be encouraging the Government to add to the Bill. On that note, I will stop.
The Parliamentary Under-Secretary of State for Transport (Keir Mather)
It is a pleasure to see you back in the Chair, Sir Alec. I thank the shadow Minister, the hon. Member for Broadland and Fakenham, for this group of amendments, which are primarily about the direction powers in the Bill.
Amendments 11 and 12 would each limit the use of the Secretary of State’s direction power, requiring that the power can be used only as a last resort, after dismissing the head of GBR and if GBR has breached its functions. I understand the intention here, which is to ensure that these direction powers are used proportionately. I assure the hon. Member that the Government agree with that aim—we absolutely must empower GBR to be the directing mind of the railway—and I agree that the railway will not work if Ministers are forced to keep meddling in it in the way that they do today. That said, this power is not the problem that he thinks it is.
The new direction power is common in relationships between the Secretary of State and arm’s length bodies. Other examples in the transport sector that are not limited to last resort use include the power in the Infrastructure Act 2015 for the Transport Secretary to direct National Highways. Hon. Members will note that these types of powers are not frequently used. These amendments would create restrictions that undermine the principle that the Secretary of State should retain the ability to respond to persistent, urgent or unforeseen issues where rapid intervention is required.
Jerome Mayhew
Where is the reference to persistent, urgent and unforeseen incidents in the Bill?
Keir Mather
The Government have made it clear what the provisions within these clauses are designed to implement. I ask the shadow Minister to look at legislation passed under his own Government that contain direction powers that are remarkably consistent with those found in the Bill, and at the directions provided in other pieces of legislation. Does he feel that they represent mission creep when it comes to Secretary of State responsibilities? He will note that these type of powers are not used frequently. We believe that these amendments would create restrictions that undermine the principle that the Secretary of State should retain the ability to respond as required.
Critically, a direction should come before there has been a serious impact. The removal of an executive or the ORR deeming GBR to be in breach of its statutory functions would suggest that a serious failure has already occurred. In the latter case, it is unclear in what situation the hon. Member would consider a breach of a statutory function to have occurred, which would introduce ambiguity into the system.
Restricting the direction powers by limiting their use to only the most serious of instances would mean that any directions were more likely to be more prescriptive and severe. I am sure that the shadow Minister would not wish to see the public or industry seriously impacted before the Secretary of State acted. The new powers also recognise the GBR board as the railway’s directing mind while enabling Ministers to intervene to support GBR to deliver or correct course.
Amendments 13 and 17 would remove the ability for the Secretary of State and Scottish Ministers, respectively, to say that GBR can exercise unspecified functions only after consultation or with their consent. I do not think that these amendments are helpful. They would effectively remove the clarity on the directions power, but would not restrict the legal scope of it. They would simply lessen the legal transparency around the use of the direction.
There are circumstances where requiring GBR to consult the Secretary of State or Scottish Ministers before taking a specific action would be entirely reasonable, and maybe even desirable for GBR. For example, where GBR needs to address a specific risk or situation as part of a wider national co-ordination or cross-industry response, the Secretary of State may need to ensure that actions are in line with national responses. The ability to revoke a direction allows Ministers to ensure that they operate in a proportionate and rational way in response to time-sensitive issues.
Amendments 15 and 18 would prevent the Secretary of State and Scottish Ministers, respectively, from enforcing GBR’s failure to comply with a direction through the civil courts. The Government need to retain the right to independent enforcement with fixed remedies that compel GBR to act across a range of mechanisms, to ensure a pathway to protecting taxpayers’ money and the delivery of the Government’s objectives. I hope the hon. Member would agree that it is completely undesirable to remove any ability for Ministers to hold the executive to account.
I also politely say that the hon. Member cannot have it both ways: either GBR is an organisation that could exercise mission creep and is too independent of scrutiny, whether from Parliament or anywhere else, or the powers in the Bill place too many strictures on it from the perspective of Government. That point of clarity is required in the Opposition’s overall perspective on the Bill.
Jerome Mayhew
As I have set out in my series of amendments, the appropriate oversight and control is to remove the chief executive. The Minister must accept that, if the Secretary of State thinks that the organisation is going in the wrong direction, is not listening to guidance or has gone rogue in some way, they have the unfettered power to remove the chief executive officer at any stage. If he does not think that is the case, he should say so now, because if the Secretary of State has the power to remove the chief executive officer and put in place someone who will do his bidding, then none of this is needed, is it?
Keir Mather
I will turn in a moment to the specific points that the shadow Minister raises around the chief executive, but I think I share his views on the importance of GBR’s compliance with its fundamental functions and with the law. That is why amendments 15 and 18 are peculiar—they do not recognise GBR needing to be able to have enforcement through that particular route.
Amendments 14 and 16 both relate to the transparency of directions. Amendment 14 would require directions to be laid before Parliament, but we believe that is unnecessary as provisions in the Bill already require directions issued under this power to be published, and Parliament has the power to call the Secretary of State to account should it take the view that more information is required.
Baggy Shanker (Derby South) (Lab/Co-op)
It is a pleasure to serve under your chairmanship again, Sir Alec. The Minister is quite eloquently setting out why some of these amendments are not needed. The shadow Minister, the hon. Member for Broadland and Fakenham, set out earlier why they were needed, but also referred to problems that may happen in the future. It is difficult to write a Bill while trying to tackle problems that may or may not happen in the future.
The fact remains that rail reform failed to happen during 14 years of Conservative Government. The previous Rail Minister admitted that the Government failed to bring in the necessary reform. We had 10 Rail Ministers, I think—correct me if I am wrong—in 14 years. That was not just a failure to bring in a Bill; it failed passengers, railways and our workers who support the railways. Is it not time that we crack on, pass the Bill and deliver the improvements that this industry so greatly needs?
The Chair
Order. I remind Members that interventions should be short and punchy. If Members would like to make a longer intervention they have the opportunity to catch my eye.
Keir Mather
I agree with my hon. Friend’s sentiment that it is unwise to hypothesise about what potential eventualities could befall GBR in specific instances, as the shadow Minister encourages me to do. What is important—my hon. Friend made an important point around consistency, both in our legislative work and the work of the Government more broadly—is to ensure that the bedrock upon which GBR sits is legally sound, and that all eventualities that may arise are catered for through provisions within the legislation that offer sufficient breadth. That is why amendments 15 and 18 do not serve the legal accountability purposes that the shadow Minister seems to want to stress.
Jerome Mayhew
I am grateful that the Minister is being very generous. In my opening remarks, I asked him to give me some real-world examples of when injunctive relief might be required. Could he not forget to provide those?
Keir Mather
I had not forgotten the shadow Minister’s request for me to provide specific examples. In a sense, though, I do not believe that it would be wise to do so. I do not think that the purpose of this Committee is to speculate about what GBR may or may not do in future; it is important that we develop a suite of measures that create the accountability that is required.
Keir Mather
I will give way one final time, and then I really do want to make some progress.
Laurence Turner
I will not test the wisdom of speculating about future legal circumstances, but is it not the case that when Railtrack was in a state of advanced collapse, that particular case did end up in court?
Keir Mather
I defer to my hon. Friend’s expertise on that particular matter, but my overall point is that, rather than create events in our heads about when this enforcement power may be required, it is important that we give GBR, and the Secretary of State in exercising accountability in relation to it, a full suite of measures to ensure that it remains compliant with the law. Actually, specific duties outlined in the Bill encourage GBR not only to be compliant with the law but to deliver for passengers, including those with disabilities, and to make sure that we have a long-term infrastructure strategy for the railway and unify it in a way that serves the interests of passengers.
Amendment 16 would require the publication of the assumptions, criteria and objectives used when giving directions about fares. The Government have been clear that GBR will have a greater level of autonomy and flexibility over fare setting than train operating companies do today; however, given the need to balance passenger and taxpayer contributions to funding the railway, that freedom will be within strategic parameters and guardrails set by the Secretary of State.
While it is possible that the directions power could be used to set strategic parameters and guardrails for fares, there are alternative routes, most notably the ability for public service contracts awarded to GBR to contain fare parameters and guardrails. Nevertheless, it is crucial that the Secretary of State retains the powers to direct and give guidance to GBR on fares. It is necessary that the Government and GBR alike can respond to exceptional circumstances. Beyond that, the Government are committed to interacting with GBR clearly and transparently, and the refreshed role of the Secretary of State on fares is no exception.
Finally, I turn to two additional amendments, which relate not to directions but generally to the accountability of GBR. Amendment 24 would require the long-term rail strategy to be geared towards enabling GBR to meet the key performance indicators set out in new clause 2, tabled by the hon. Member for Broadland and Fakenham. New clause 4 would allow the Secretary of State to dismiss the head of GBR were it not meeting the key performance indicators proposed in new clause 2. We have already discussed new clause 2, so I will not repeat my arguments, but in relation to amendment 24, the long-term rail strategy is clearly meant to be just that—long term. The amendment would make the strategy a document focused on short to medium-term performance indicators, which could change much more frequently.
Rebecca Smith
I would argue that my hon. Friend the Member for Broadland and Fakenham has tabled a key amendment, which relates to something that came up in the scrutiny of the Bill in the Transport Committee; indeed, I asked a question of the noble Lord Hendy about it when I quizzed him on how we as MPs are supposed to hold the Government to account for the delivery of the long-term rail strategy. I appreciate that it is long term, but we have to get from the short term to the long term, and if nothing is set out in the Bill about what delivery is supposed to look like on the route to the long-term delivery, we effectively cannot do our job. The Minister in the other place rightly said, “It’s going to be an amazing railway system. It’s going to be perfect,” but he could not answer me on how we hold people to account on getting from A to B. I would be interested in the Minister’s response to that if he is not prepared to accept amendment 24.
Keir Mather
It puzzles me that with all the other transport bodies that have been set up—National Highways is an interesting example—I do not recall a series of concerns having been outlined that one of the most robust systems of parliamentary democracy in the world was in some way, shape or form incapable of—
Jerome Mayhew
I am grateful to the Minister, though I remind him that we do have 14 sessions; we are not cantering to the last fence. He prays in aid National Highways. We are all constituency MPs. We all know how frustrating it is trying to deal with National Highways. I do not want to make a headline unnecessarily, but my personal view, as a constituency MP, is that trying to deal with National Highways in the interests of my constituents is almost impossible. Why would he choose that as the example to follow when designing accountability for GBR?
Keir Mather
In a spirit of cross-party contrition, I agree with the shadow Minister’s point; it is a fair one, and perhaps that was a poor example.
In the setting out of the long-term rail strategy, through the Secretary of State, there are myriad means of Parliamentary accountability to ensure that process is done in a way that reflects the long-term interests of the railway and of passengers. There are robust means of scrutiny through this House and other means of which Parliamentarians can avail themselves of, and of which the hon. Member for South West Devon has availed herself multiple times through the passage of this Bill.
I would like to conclude on this grouping and so I want to speak to new clause 4. As the hon. Member for Broadland and Fakenham will be aware, with bodies of this nature the Government’s long-standing policy is that the Secretary of State of the sponsoring Department has responsibility for appointing the non-executive chair of the board. The executive team is then accountable in the first instance to the organisation’s non-executive board, and it is right that trust is given to the expertise and experience of the executive and that there is appropriate distance between the Secretary of States and those tasked with the day-to-day operational management of the organisation. That is one of the benefits of the GBR model.
Legislating to dictate a process whereby the chief executive is dismissed directly by the Secretary of State for failure to meet a single KPI is not appropriate and it cuts across all guidance and understanding of effective partnership between Government Departments and their arm’s length bodies. For those reasons, I cannot accept these amendments and urge the hon. Members to withdraw them.
Jerome Mayhew
I am wholly unconvinced by the explanation the Minister has given. On many of the clauses and amendments I have put forward, and those put forward in the names of other Members, one can see both sides of the argument; on this one, I think the Government are entirely wrong. They are setting up a structure using another arm’s length non-governmental body, National Highways, that is a byword among us constituency MPs for a lack of accountability and for being a frustrating body to deal with. That is not the right direction for the Government to be going in and I will push the amendments to a Division.
Question put, That the amendment be made.
Keir Mather
I beg to move amendment 166, in clause 7, page 5, line 4, leave out
“operation of a GBR-provided Scottish service”
and insert
“exercise by Great British Railways of functions—
(i) on behalf of the Scottish Ministers in accordance with arrangements made under section 4, or
(ii) under a contract awarded under section 31(3)(b)”.
This amendment broadens the circumstances in which the Secretary of State must obtain the consent of the Scottish Ministers, where giving directions to GBR.
The Chair
With this it will be convenient to discuss the following:
Government amendments 167 and 168.
Clause stand part.
Clause 8 stand part.
Keir Mather
The amendments will improve clarity and ensure that the Railways Bill works as intended. Clauses 7 and 9, as drafted, set out that the Secretary of State must obtain consent from Scottish or Welsh Ministers when issuing a direction and guidance to GBR
“in a manner that directly affects the operation of”
a GBR-provided Scottish or Welsh service. That definition could unintentionally exclude scenarios where Great British Railways is exercising functions delegated by Scottish or Welsh Ministers that do not directly affect operation of railway passenger service functions, such as in relation to branding. The amendments provide a clearer and more precise approach. Consent will now be required whenever GBR is acting on behalf of Scottish or Welsh Ministers under formal arrangements enabled by clause 4, or contracts awarded under clause 31. That is a better way of defining where consent is needed as it reflects the responsibilities devolved to Scottish and Welsh Ministers under the Bill.
The amendments remove ambiguity from the Bill without changing its core purpose. They ensure that devolved Governments have a clear and consistent role in decisions affecting services devolved to them, while maintaining the Secretary of State’s ability to protect the network as a whole. That approach has the support of both Scottish and Welsh Ministers because it provides certainty and transparency. I therefore urge the Committee to support the amendments.
Clause 7, to which the amendments apply, provides the Secretary of State with the power to issue legally binding directions to Great British Railways. Clause 8 replicates that power for Scottish Ministers when GBR is exercising functions relating to Scottish railway services in Scotland. Such powers are common in relationships between Government and arm’s length bodies and used only when absolutely justified and in a proportionate way. For example, the Oil and Gas Authority has received only one ministerial direction in its 10-year history.
Clause 7 is a normal, standard accountability provision that follows established precedent. It is a type of power that is always used sparingly. It is not a new and extraordinary means of interfering with the railway that the Government are trying to decentralise to GBR. The powers are necessary to reflect the overall democratic accountability of the Secretary of State and Scottish Ministers for the performance of GBR within the areas of the country that they are responsible for and fund.
To protect GBR’s day-to-day operational independence as the directing mind, the powers will be used only where there is strong justification, in consultation with the ORR and after agreed processes have been followed. For Scotland, those processes include following a series of procedures and controls that will be set out in the memorandum of understanding between the Secretary of State and Scottish Ministers that is required under clause 23 of the Bill. They also include consulting the Secretary of State before using the power.
To ensure appropriate transparency, the clauses require that the Secretary of State and Scottish Ministers must publish any issued directions, including when they are amended or revoked. As GBR may also provide services on behalf of Scottish or Welsh Ministers, clause 7 requires the Secretary of State to secure the consent of Scottish or Welsh Ministers to issue directions to GBR relating to areas that fall under the devolved responsibilities of Scotland or Wales.
Finally, to avoid a scenario where GBR receives contradictory directions from Ministers or where directions issued by Scottish Ministers appear to go beyond their responsibilities, clause 8 provides the power for the Secretary of State to revoke Scottish Ministers’ directions. We have agreed with Scottish Ministers that that provision is necessary to protect the overall network as a whole.
The clauses are essential to provide a clear and proportionate route for intervention while still enabling GBR to deliver as the directing mind in the interests of its customers, taxpayers and the public. I commend the clauses to the Committee.
Jerome Mayhew
The Committee will be pleased to hear that I am not going to reheat my arguments on clause 7, but we have not yet discussed clause 8. The arguments inevitably mirror each other to a degree, because clause 8 in the main seeks to extend the provisions of clause 7 to Scottish Ministers.
Clause 8 will grant Ministers in Scotland the power to issue and publish directions to GBR—so far, so similar—and GBR will be required to comply with those directions. However, the Secretary of State has ensured that they will have the ability to remove a direction of Scottish Ministers where it is inconsistent with her directions. The clause requires the Secretary of State to consult Ministers in Scotland before revoking and must publish any revocations.
The clause suffers from the same issues as clause 7, as I have already intimated: granting the Secretary of State, and then by extension Scottish Ministers, the ability to direct GBR, which is meant to be operationally independent. That is the first confusion. I will not rehash the arguments, but hon. Members should take it as read that I repeat them here.
As the Minister just mentioned, clause 8(7) will allow the Secretary of State to revoke a direction given by Scottish Ministers under that clause. That is confusion No. 2. We anticipate circumstances in which GBR has a direction of travel—that is not meant to be a rail pun—with which the Scottish Minister disagrees; the Scottish Minister issues a direction for GBR to go in a different direction, and then the Secretary of State disagrees with that direction and issues a revocation. What a recipe for confusion, delay and poor governance that creates!
Who is really in charge of the railways in Britain? It is certainly does not sound as though it is GBR, which is being second-guessed on the one hand by the Scottish Ministers and on the other by the Secretary of State. It does not sound as though Scottish Ministers are in charge even in Scotland, because they can suffer a revocation from the Secretary of State. Yet the consultation document tells us, as the Government have told us time and again, that
“GBR will be operationally independent, staffed by experts and professionals from the rail sector…who will be empowered to deliver for passengers and freight customers without government interference in day-to-day decision-making.”
When did that change? Perhaps the Minister can let us in to the secret. Clause 8 not only prevents GBR from being independent—as clause 7 does—but prevents devolved Ministers from acting within their own devolved settlements without being second-guessed by the Secretary of State.
I accept that the Scottish Cabinet Secretary for Transport, Fiona Hyslop MSP, when speaking about clause 8 during the Transport Committee evidence session, seemed not to oppose that oversight, as she recognised that certain aspects, such as access and freight, remain reserved. It seems that Scottish Ministers are content to accept the clause as drafted because a further memorandum of understanding will create firebreaks between non-devolved powers, in which the Secretary of State may intervene, and devolved powers. That could be okay, but we as a Committee do not know, because we have not seen the memorandum of understanding, even in draft.
We are going to come back to this issue again and again. There are a plethora of documents designed to support the operation of GBR—to support this skeleton Bill—and yet we have not seen them. How can this Committee do our job of scrutinising this Bill line by line, seeking to improve it and to ensure that it achieves the objectives that the Government say it does, when 19 documents and counting—documents that are crucial to the actual running of the railway both in Scotland and in the United Kingdom as a whole—are absent, even in draft?
Bill Reeve, the director of rail reform for Transport Scotland, when invited to add further to the remarks from the Cabinet Secretary, said:
“An awful lot will rely on the memorandum of understanding to flesh that out and give examples.”
There is a question for the Minister surrounding this memorandum of understanding for Scottish and Welsh Ministers. A lot of the powers in the Bill seemingly rely on a document that is not part of the Bill. Will the Minister provide details of the memorandum of understanding prior to the passage of this Bill? If not, why does he refuse to let us know what the memorandum of understanding is likely to stay? Why does he believe that Parliament should approve a working arrangement between the devolved Governments on which no consultation has been undertaken?
I will speak further in detail on the memorandum of understanding when we reach clauses 23 and 24, but it is important that Ministers note that the current framework of the Bill relies on a document that has little oversight or clearly defined objectives, and which we have not seen.
Keir Mather
On memorandums of understanding, I point the shadow Minister to the fact that the heads of terms for the memorandum of understanding with the Welsh Government have already been published. On the overall principle on the development of memorandums of understanding, the stakeholders who gave evidence to the Committee were very clear that the process is being carried out in close consultation with devolved Governments and that it is very common for such operational documents to be developed in consultation in this way.
We are creating an operational framework by which GBR can function as an organisation. It is very important that that platform exists before the devolved settlements that will dictate the operational reality of how the railway works are layered on top.
On the shadow Minister’s point about direction powers, these are the same direction powers that exist, almost like for like, with Great British Energy, Great British Nuclear and the North Sea Transition Authority. They are there to respond to urgent and pressing matters. His points on overreach should have applied to the creation of those organisations as much as to the creation of GBR.
The factual reality of how the direction power has been used in the case of oil is that only one direction has been issued in 10 years. It is the Government’s intent—we have been very clear in saying so—that this direction power must operate in a similar way and only respond to urgent, pressing and persistent matters.
On the issue of direction from Scottish Ministers, the Secretary of State cannot revoke a direction if it pertains purely to a devolved matter, but Scottish Ministers did agree that revocation powers are necessary when there are conflicts in directions. Speaking from my perspective on how this Bill puts the devolved settlement at the centre of how the railway functions, there are sufficient methods to create accountability, mutual working and shared recognition of priorities and ambitions across devolved Governments, the UK Government and GBR, so that I do not envisage a revocation of a direction being used regularly. It is only there to ensure the smooth function of the railway.
Amendment 166 agreed to.
Amendment made: 167, in clause 7, page 5, line 8, leave out
“operation of a GBR-provided Welsh service”
and insert—
“exercise by Great British Railways of functions—
(i) on behalf of the Welsh Ministers in accordance with arrangements made under section 4, or
(ii) under a contract awarded under section 31(4)(b).”.—(Keir Mather.)
This amendment broadens the circumstances in which the Secretary of State must obtain the consent of the Welsh Ministers, where giving directions to GBR.
Amendment proposed: 14, in clause 7, page 5, line 9, after “publish” insert “and lay before Parliament”.—(Jerome Mayhew.)
This amendment would require the Secretary of State to lay any directions given to Great British Railways before Parliament.
Question put, That the amendment be made.
Jerome Mayhew
It is certainly welcome, but we are still in the position in which an improvement to a line—something as small as the Haughley junction improvement, which costs roughly £15 million to £20 million—still needs ministerial sign-off from the Treasury before it can be authorised. The Government have some way to go to improve the situation.
This will leave us with a stakeholder management culture. My hon. Friend the Member for South West Devon is entirely right that many organisations in the 60% of the railway that is not being nationalised as part of GBR will be intimately and hugely impacted by GBR’s decisions—or will they? Will they, too, have to wait for the all clear from the Department for Transport? If GBR gets on the wrong side of Ministers or the Department, its course is going to be corrected to all manner of different ports.
The combination of clauses 7 and 9 removes almost any semblance of operational independence from GBR. Clause 9(5) states that GBR
“must have regard to guidance given under this section.”
That sounds soft, but in practice it creates a standing expectation of compliance and makes it impossible for GBR to make dynamic tactical decisions that are free from day-to-day second guessing by departmental and ministerial intervention.
That brings me to amendments 19 and 21, which would help defend the operational independence of GBR. If the Secretary of State is concerned about an aspect of GBR’s performance, they may instead issue guidance to inform GBR of its failure to meet the key performance indicators. Additionally, under clause 10, the Secretary of State may give guidance only if
“Scottish Ministers have drawn to Great British Railways’ attention that Great British Railways is not meeting a key performance indicator…and…Great British Railways has not taken action to remedy this failing within the period of two months.”
As a result, the amendments would apply to GBR in both England and Scotland.
Finally, amendment 20 repeats the argument made about directions or guidance given by the Secretary of State on the general level and structure of fares, and it would introduce new subsection (5A), which states:
“If the Secretary of State uses the powers in this section to give guidance to Great British Railways about the general level and structure of fares for travel on railway passengers services designated under section 25 or 26, then the Secretary of State must publish the assumptions, criteria, and objectives underpinning any guidance.”
That is self-evidently sensible, and I look forward to the Minister agreeing with me.
Keir Mather
May I begin by addressing the point about backseat driving? Following the shadow Minister’s remarks, I identified that this is something that we want to avoid not only in future but because it is the existing scenario that we inherited. Right now, under the old system, the Secretary of State is the only person who is really accountable for driving the system forward, and private operators spent more time employing people to decide who was to blame for failures on the railway than ensuring that the railway actually ran in the interest of passengers.
Interference in access and timetabling is another issue that has been raised. The reason why we have diffuse responsibility and muddled accountability in that space is because Network Rail and the ORR, which are two separate organisations, both have responsibility there but they cannot do it in a unified way, and therefore they cannot serve the interests of passengers. That is exactly what the creation of GBR as a directing mind for the railway seeks to avoid, and guidance within that system plays a very important role in removing one of the shadow Minister’s key concerns: an overbearing Secretary of State issuing direction to GBR. Guidance has been designed to create an iterative process by which GBR can enter into a dialogue with the Secretary of State to talk through and deal with common challenges.
The amendments seek to limit the ability of the Secretary of State and Scottish Ministers to issue guidance to GBR under clauses 9 and 10. I am clear that the new system established by the Bill does not intend to involve the Secretary of State or Scottish Ministers in ongoing or individual operational decisions. That is for GBR’s board and the thousands of employees working on the railway. Instead, the guidance power provides a mechanism through which Ministers can respond to overarching issues that might emerge. For example, if the ORR identified persistent failures in GBR’s performance against its business plan, it may suggest guidance from the Secretary of State that could help to support GBR to course correct, and to clarify the desired outcome without requiring more stringent action, such as a direction.
Further, it is not all one-directional guidance. Guidance will be a flexible tool designed to support Great British Railways. For example, there may be instances where guidance is requested by GBR and is issued in a collaborative manner to provide clarity on the policy direction or shared objectives. I also remind members of the Committee that GBR must have regard to the guidance—in other words, it must consider the guidance and weigh it against its other duties and obligations. It is not required to blindly follow the guidance in all cases.
Let me turn to the specifics of each amendment. Amendment 143 would limit the issuing of guidance to solely financial or strategic matters. In seeking to establish a hard line between types of decision making, the amendment would create a false dichotomy. Strategic and financial decisions are likely to have operational implications. The amendment could therefore inadvertently prevent the Secretary of State from being able to issue guidance where there is any operational impact at all, which is clearly disproportionate, given the potentially collaborative and helpful nature of the guidance.
Similarly, amendments 19 and 21 seek to prevent the Secretary of State and Scottish Ministers from issuing guidance unless GBR is not meeting a key performance indicator under the Opposition’s proposed new clause 2. I have already explained why that proposed new clause is nonsensical. I reiterate that KPIs would be better designed and included as part of GBR’s business plan.
Keir Mather
Clause 9 provides a power for the Secretary of State to issue non-binding guidance to Great British Railways, which GBR must have regard to. Clause 10 provides Scottish Ministers, as funders of the railways, with the same power.
Guidance provides the Secretary of State with a proactive lever to hold GBR to account, while preserving its operational independence as the directing mind. Scottish Ministers will be able to issue guidance to GBR on the exercise of its statutory functions in Scotland, in so far as they relate to Scottish railway activities.
These powers will be used by the Secretary of State and Scottish Ministers to help to develop a better common understanding of an area or to encourage a strategic focus on a specific issue to support GBR in carrying out its functions in the interests of its customers, taxpayers and the public.
To ensure appropriate transparency, the Secretary of State and Scottish Ministers will be required to publish any issued guidance, as well as any amendments or revocations. Further, where the guidance relates to functions that Scottish or Welsh Ministers have delegated to GBR or to services that they have contracted GBR to provide, the Secretary of State must secure their consent before the guidance is issued, reflecting devolved accountability for those services.
This is a sensible and proportionate provision that allows for direct and unambiguous communication between Ministers and GBR, and is intended to support the proper management of the railway.
Jerome Mayhew
We have debated these two clauses. We have made clear our concerns about the current drafting and have tried our best to improve the Bill through a number of very sensible amendments, the majority of which were supported by the Liberal Democrats. We in our turn have supported some sensible amendments proposed by the hon. Member for Didcot and Wantage. I recognise that to vote against the clauses would potentially put a difficult hole in the armoury of the Secretary of State for GBR, so it is with a heavy heart that I do not oppose these two clauses.
Question put and agreed to.
Clause 9 accordingly ordered to stand part of the Bill.
Clause 10 ordered to stand part of the Bill.
Clause 11
Licensing
Question proposed, That the clause stand part of the Bill.
Keir Mather
On a point of order, Sir Alec. Before turning to the clause, I would like to correct the record. My Department’s commitment has always been to publish the draft GBR licence during the Bill’s passage, rather than before the Bill leaves the Commons, as I had said in oral evidence on 20 January. Before publication in draft, my Department will undertake engagement with stakeholders to inform the draft. That engagement will start before the Bill leaves the Commons, and I will ensure that hon. Members are involved in it if they would find that beneficial.––[Official Report, Railways Public Bill Committee, 20 January 2026; c. 97, Q180.]
Keir Mather
Clause 11 introduces schedule 1, which will amend part I of the Railways Act 1993 to set out GBR’s licensing regime in a way that broadly mirrors the existing licence provisions in the 1993 Act. I will deal with schedule 1 in more detail later, but for now I commend the clause to the Committee.
Rebecca Smith
I do not think I said this earlier, because I was merely intervening, but it is a pleasure to serve under your chairmanship, Sir Alec.
I appreciate what the Minister just set out in correcting the record from last week, because a lot of what I was going to say had to do with the lack of the licence. In spite of what he said, I still think that it is a problem for us to be debating clause 11, and later schedule 1, without that detail in front of us. It is very generous of him to say that we can be part of the consultation process, but given that we are encumbered with being here for 10 hours a week, I am not quite sure when would be able to do that. With all due respect, I still want to put on record how disappointing it is that we do not yet have the licence. Ultimately, Great British Railways is entirely premised on that licence: it does not operate without it, cannot deliver its functions without it, and will not create this supposedly amazing utopia of perfection for passengers and infrastructure deliverers alike without it.
Debating the clause without that context feels like a completely wasted opportunity—indeed, I fear that this debate will be incredibly short. This is something that I have seen happen with other Bills. The Minister will say that this is what the Opposition would also have done, but we were not in the position to set up Great British Railways, which—next to the NHS—will be the biggest Government-funded and backed body in this country. Without the scrutiny of hon. Members this morning, we cannot do our job properly.
Such scrutiny is in the interest of all the stakeholders—the public, the staff who work for all the railway companies that are to be brought into Great British Railways, and all the other stakeholders that provide services through open access or freight. Whether it is the coffee shop in a station or the trolley service on the train, all these people need this information, and I am disappointed that we cannot provide that scrutiny at this stage in the debate. I would welcome the opportunity to see the draft as soon as it is out, but it is disappointing that has not come in time for debate in Committee. No doubt similar comments will be made on Report and, hopefully, in the other place.
Jerome Mayhew
I echo all the comments made by my right hon. and hon. Friends. I also thank the Minister for facing up to it with a point of order. It was obvious last week that a point of order was on its way. None of us on the Opposition Benches will hold him to his initial, rather quick, response—no doubt I will do something similar during the passage of the Bill—but that does not let the Government off the hook.
This is not business as usual for a Department bringing through a Bill of this nature. My right hon. Friend the Member for Melton and Syston, an experienced former Minister, gave two examples of primary legislation that also relied on secondary documentation. In those circumstances, the departmental teams did provide skeleton outlines for Parliament, which is what we are, to consider and do our job properly. I do not want the Minister to rush out a quick affirmative like last week, so I ask him to take time to consider, perhaps discuss with his officials, and reply later today on whether he and his officials are able to commit to some form of briefing—some skeleton outline—on the nature of the licence, at a time when we can collectively discuss and debate it, and see whether it points in the right direction.
Clause 11 simply enables GBR’s licensing to be set out in schedule 1, which we will come on to in a moment. That schedule amends part 1 of the Railways Act 1993 and sets out the detailed process by which the GBR licence will be issued and maintained. Both the Secretary of State and the Office of Rail and Road will retain the ability to grant licences to railway bodies other than GBR—for example, open access operators, freight operators and other infrastructure managers such as the core valley lines in Wales. I know we will discuss the contents of schedule 1 and the detail of the licence extensively.
Keir Mather
Although we have had an opportunity to discuss some of the provisions regarding the creation of the licence—it being enforced by the ORR with powers that include giving GBR directions to escalate issues to its board, requiring GBR to create and publish improvement plans and issuing enforcement orders— I have heard Opposition Members’ points that they would like an opportunity to discuss those matters more closely and in further detail.
We believe that developing the licence in this way will ensure that what is published for statutory consultation is informed by the development of a stable legislative framework in which to scrutinise the licence—as we are doing now—and can be meaningfully refined and enhanced by a wide range of views. However, I take the point that the shadow Minister and other right hon. and hon. Members have made, and I am sure that we can have further discussions today. I commend the clause to the Committee.
Question put and agreed to.
Clause 11 accordingly ordered to stand part of the Bill.
Schedule 1
Licensing of Great British Railways
Jerome Mayhew
I beg to move amendment 109, in schedule 1, page 55, line 10, leave out from “may,” to “grant” and insert—
“at the recommendation of the Office of the Rail and Road in relation to matters related to safety and standards and, after consultation with the Passengers’ Council,”.
This amendment would require the Secretary of State to get a formal recommendation from the Office of the Rail and Road that the GBR licence adequately ensures that licence obligations related to safety and standards are not compromised or undermined.
Schedule 1 contains the meat of what we have been talking about. It amends part 1 of the Railways Act 1993 to set out how GBR will be licensed. Paragraph 2 confirms that GBR should never be exempt from holding a licence, and paragraph 3 inserts new section 7B, which will enable the Secretary of State, following consultation, to grant GBR a written licence to operate specified railway assets. The licence must be in writing and will remain in force unless revoked or surrendered. Surrendering the licence will require the Secretary of State’s consent.
Paragraph 3 also sets out the process for granting licences to persons other than GBR. The Secretary of State and the Office of Rail and Road will continue to be able to grant licences to persons other than GBR to operate railway assets. The ORR may grant such licences only with the Secretary of State’s consent or under a general authority issued by the Secretary of State. Licences must be in writing and will remain in force unless revoked or surrendered. Surrendering the licence will require the ORR’s consent, much in the same way as it previously required the Secretary of State’s consent.
Proposed new section 8A sets out the requirements for the granting of licences by the Secretary of State or the ORR. It provides that a notice must be published outlining the intention to grant a licence, the reasons for doing so, and allowing at least 28 days from the date of publication for interested parties to make representations or objections. There is a duty to consider representations or objections made within the period specified in the notice.
Proposed new section 8B gives the Secretary of State the power to set rules for how licence applications must be made. Among other things, that includes the format of the application, the fee payable—different fees may apply—and the requirements for publishing the application. Before making any regulations, the Secretary of State must consult the ORR. Any fees collected by either the Secretary of State or the ORR in connection with licence applications must be paid to the consolidated fund.
Paragraph 4 clarifies that a licence granted to GBR may specify when the authorisation it provides takes effect. It allows the licence to include a start date or a mechanism for determining it. Paragraph 5 provides that the licence granted to GBR may include a condition requiring it to comply with the provisions set out in separate document that is prepared by the ORR and approved by the Secretary of State. It might be something such as a code of practice—one of these operating documents that we have been talking about so much—and it may relate to the sale of tickets by GBR or third parties, or to services that GBR provides to the rail industry to facilitate railway operations that are of particular interest to the independent retail sector. The paragraph makes it clear that an approved document may be used to regulate GBR’s behaviour in relation to the sale of tickets by parties other than GBR, in the independent retail sector.
Paragraph 6 provides that, before making modifications to a GBR licence, the Secretary of State must publish a notice explaining the proposed modifications and the reasons for them, and must allow the usual period of 28 days for interested parties to make representations. There is a duty on the Secretary of State to consider representations or objections to the notice made within the period specified.
Paragraph 7 clarifies that the ORR must consult the passengers’ council before making any amendments to passenger or station licences that relate to functions of the council. The ORR must also send a copy of the modifications to the council as soon as practicable. Paragraph 9 clarifies that any licence under section 8 of the Railways Act 1993 that was in force immediately before the changes made by the schedule come into force will remain so, per the conditions and periods set out in the licence, unless it is revoked or surrendered.
Here is the mystery of the missing licence: where is it? We have explored this at some length, and the Minister is going to go away and see what he can rustle up in the Department’s cupboard to point us in the right direction, or at least to give us the direction of travel of the missing licence. In oral evidence to the Transport Committee, Ben Plowden, chief executive officer of the Campaign for Better Transport, said:
“I think the licence will be critical. There are various references in the documents that the Government published to a ‘streamlined licence’, so I would be quite interested to see what that means relative to the current licence that applies to Network Rail. I think the Government are going to consult on the draft licence, so we will all have a chance to look at it.
The other point I would make is one I made earlier, which is that the licence will be one of many documents the Government will produce in the next year to 18 months. There is the long-term rail strategy and GBR will produce its business plan. There will be the access and use policy; the new periodic review process; and MOUs with Ministers in Scotland and Wales. There will be guidance on partnerships with mayoral combined authorities, and guidance on the right to request full rail devolution. There is a huge amount still to come.
Understanding how the licence intersects with those other documents and processes is going to be critical, because between them they will add up to the set of arrangements that determine whether GBR is successful or not for passengers. We have to see the licence in the context of all the other things that will be guiding, directing and shaping what GBR does, how it invests, and what it does operationally.”
That is the experts in the industry repeating what the Opposition have been arguing repeatedly today and last week. More accurately, it is the other way around: we have been listening to the industry in a way that the Government have not, and have been expressing the deep concerns in the sector that the current proposals are half cocked. Huge chunks of the direction, guidance and memorandums are simply missing, including the licence that the schedule is designed to address.
Keir Mather
I thank the hon. Gentleman for the amendment, which is intended to prevent the Secretary of State from granting a licence to GBR unless the ORR gives a formal recommendation that licence obligations related to safety and standards are not compromised or undermined. The amendment does not specify what the ORR’s recommendations would need to contain or how it would operate in practice. The Government recognise the importance of effective regulation in the rail sector, particularly in relation to safety. The safety of our railways is a priority, and we will ensure that it is central to GBR, so that our railways continue to rank among the safest globally. The Bill makes no changes to the existing safety regime, which has proved to be exemplary.
In practice, amendment 109 would give an approval role to the ORR on matters relating to safety and standards ahead of the GBR licence being granted by the Secretary of State. It would confuse the clear accountabilities that the Bill establishes, which place responsibility for drafting, consulting on and granting the GBR licence with the Secretary of State, with the ORR then enforcing against its provisions. That aligns with the Government’s approach to regulation: Ministers set policy and strategy, and regulators provide validation and reassurance to the industry.
The Bill already requires a consultation on the contents of the GBR licence and specifies that the ORR and the passenger watchdog must be consulted as part of that. That will ensure that any concerns about safety and standards can be raised and considered appropriately ahead of the GBR licence being granted. The amendment would confuse accountabilities and add additional processes where they are not needed. I therefore urge the hon. Member to withdraw the amendment.
Jerome Mayhew
I am grateful for Minister’s explanation, but I am not persuaded by it and seek to put amendment 109 to a vote.
Question put, That the amendment be made.
Railways Bill (Fourth sitting)
Keir Mather ExcerptsThursday 22nd January 2026
(2 weeks, 3 days ago)
Public Bill CommitteesRead Full debate Railways Bill 2024-26 View all Railways Bill 2024-26 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Public Bill Committee Amendments as at 22 January 2026 - (22 Jan 2026)
Edward Morello (West Dorset) (LD)
I will speak to new clause 20, which makes the simple ask that Great British Railways does all it can not to contribute to the climate crisis. I hope it is uncontroversial, because the bits of legislation that we are asking for GBR to adhere to are the Environment Act 2021 passed by the previous Conservative Government, the Climate Change Act 2008 passed by the previous Labour Government, and the Air Quality Standards Regulations 2010 passed by the coalition Government.
I am deeply concerned that climate change does not appear in the Bill at all, and we tabled new clause 20 to close down that problem. At a time when extreme weather is already disrupting services, damaging infrastructure and frustrating passengers, the absence of any clear environmental duty is extremely troubling. We are already seeing the impacts of climate change on our rail network. In West Dorset, services have been severely disrupted by soil moisture deficit, alongside flooding, high winds and extreme weather. Last summer, that led to a reduced timetable, widespread delays and endless bus replacement services. From August, services from London to Yeovil Junction were cut to one train an hour, and took more than half an hour longer, while services to Exeter were reduced to one every two hours. That is the cost of not planning ahead.
New clause 20 would require GBR to take climate risk seriously in every decision that it makes. That means factoring in flood risk, heat stress on tracks, coastal erosion and extreme weather, and designing infrastructure that can cope with hot summers and wet winters. If the Bill is about the future of rail, it must account for a future that is going to be impacted by climate change. The new clause would strengthen the case for rail electrification, encourage low-carbon construction methods and ensure that procurement decisions properly consider materials, the supply chain and energy use.
Without a clear statutory duty, environmental goals risk being treated as entirely optional. With new clause 20, climate and environmental objectives would become part of GBR’s core purpose. Decisions would be more consistent across the network, rail would be properly aligned with national climate and nature targets, and GBR would be more transparent and accountable.
The Parliamentary Under-Secretary of State for Transport (Keir Mather)
It is a pleasure to serve under your chairship, Sir Alec. I thank hon. Members for the amendments and new clauses in the group. Before I turn to amendments 3 and 4, however, I will pick up on a point made by the hon. Member for South West Devon earlier about people across the country having an understanding of GBR and its functions, and knowing how it will impact the railway and their lives. The shadow Minister, the hon. Member for Broadland and Fakenham, has consistently given the statistic that 60% of functions on the railway will still be done by the private sector, once GBR is established—
Jerome Mayhew
To clarify, that figure is about not just the private sector, but rail services in Scotland and Wales not being part of GBR. It is the non-GBR parts of the greater rail world: about 60% are nothing to do with GBR.
Keir Mather
I thank the shadow Minister for that clarification. I want only to add, as a further clarification, that in the future GBR will account for about two thirds of passenger services in Britain, and GBR infrastructure will make up 90% of station stops. It is quite important to give that level of context, so that people can better understand the impact that these changes in the railway will have on their lives.
Amendments 3 and 4 would limit GBR’s research, advice and standards development functions to only the railway and services managed by GBR. I reassure the shadow Minister that the vast majority of research and innovation carried out by GBR will relate specifically to the services that it provides and the operation and maintenance of its network.
However, research, development and innovation tend to be general in nature and application. It is critical that GBR’s research, development and innovation should be able to support the wider rail network, not just the elements that GBR manages itself. Collaboration between the independent parts of the sector on learning and innovation is, we argue, crucial for the rail network to operate as an integrated whole, and limiting this function could arbitrarily restrain wider adoption of best practice. Various organisations, including Network Rail and train operating companies, currently publish standards adopted on the railway, so this is not a unique or abnormal practice. However, these amendments could arbitrarily constrain it and might even hinder GBR from supporting research that might bring benefits to parts of the network, or services, not managed by GBR.
Amendment 5 seeks to return responsibility for taking access decisions to the ORR. That is one of the fundamental questions sitting at the heart of our debates on the Bill. The amendment is contrary to the Government’s manifesto commitment to establish GBR as the directing mind for the railways. It would reintroduce the fragmentation and conflicting accountabilities that exist in today’s system. At present, there is no single body in charge of taking a whole-system approach to making access work. That leads to conflicting opinions about what services can fit where and when. Differences in view between Network Rail and the ORR cause delays in producing the timetable, hindering efforts to tackle congestion, disruption, cancellations and overcrowding. The current system is not fit for purpose: it lets passengers down every day, and taxpayers are not getting value for money.
In the current system, the absence of a single directing mind, with a single set of objectives, leaves us with ridiculous situations such as the recent 7 am Manchester service that was set to travel with no passengers on it. I do not understand how hon. Members can think that continuing the current system benefits anyone, least of all passengers.
The Government have been clear that for GBR to have the space and authority to take access decisions consistent with the best use of the network, the ORR’s current role must change. GBR must be the decision maker on access; it must have authority and full accountability for what happens on the tracks. The ORR will play a key role as a robust appeals body that ensures that GBR’s decisions are fair. Without one body in charge of taking access decisions, we cannot deliver the performance improvements that we have promised passengers and the public.
Amendment 6 would remove the delegated power for the Secretary of State to confer further statutory functions on GBR in the future. Although clause 3 has been drafted to cover the breadth of activities that we expect GBR to undertake, it is responsible to legislate with proportionate flexibility. For example, in the future there may be new technologies or other responsibilities relating to the railways that GBR would need to take on. We heard in oral evidence on Tuesday that the advent of artificial intelligence and wi-fi are two examples of that type of change, and that witnesses understood the need for this type of flexibility for GBR.
There is precedent for this type of power in legislation. For example, the National Health Service Act 2006 includes a power to add functions to special health authorities specified in regulations. That power is already limited to adding new functions that relate to the railways; any regulations conferring new functions would be subject to the affirmative procedure, which would ensure suitable transparency and parliamentary scrutiny.
Amendment 241 seeks to require GBR to act
“in a fair and non-discriminatory manner”
when carrying out its statutory function in clause 3 —specifically, when GBR is providing back-of-house functions to facilitate railway services run by operators other than GBR, such as a journey planner. The amendment is not needed, because the duties set out in the Bill will govern GBR’s behaviours when carrying out its statutory functions. I assure the hon. Member for Broadland and Fakenham that the duties will require GBR to act in the interests of the public, taxpayers and passengers. GBR will act fairly and in accordance with its duties, not only when exercising this function but across the full range of its statutory functions.
In addition, competition law will apply in full to GBR. This requires GBR to act in a manner that is fair, non-discriminatory and not anti-competitive. Both the ORR and the Competition and Markets Authority will regulate GBR’s behaviour against its competition law obligations, so I hope that hon. Members will be assured that GBR must always treat all private operators with fairness and in a non-discriminatory manner. Given those safeguards, the addition proposed would be duplicative.
I turn to new clause 15, which seeks to implement a statutory electrification programme. Living near Selby station, I know better than most that rail electrification is important, including to realise the Government’s wider goals of decarbonisation. The hon. Member for Didcot and Wantage ably set out the fact that decarbonisation is not the sole efficiency and aspiration that can be realised through electrification. We fully realise the need to reduce the cost of electrification and accelerate the delivery of committed schemes in comparison with past experiences.
We are currently developing a long-term strategy for rolling stock and associated infrastructure. That will be published in the summer and will consider the future approach to electrification. That being said, a legislative duty to carry out an electrification programme is not the right way to deliver these important upgrades. In the effort towards net zero, electrification may not always be the right solution—although the hon. Member for Didcot and Wantage made a well-reasoned case as to how, in many cases, it is. Other opportunities, such as trains powered by batteries, may be more appropriate. It is also hard to predict the pace at which battery technology and other alternative technologies will progress over the next 20 or 30 years, and what that means for the extent of electrification that will be needed as we move towards net zero.
Edward Argar (Melton and Syston) (Con)
I appreciate the Minister’s points. How does he see the drive towards electrification, for all the good reasons he has set out, sitting with building a degree of resilience into the rail network? The hon. Member for Nottingham South, the other Minister, may have experienced the problem that I had last weekend, when, due to attempted overhead cable theft, a load of trains through the east midlands were cancelled. That happened because there is no back-up mechanism to move those trains if the electrical supply is not there. How do we square that circle of making sure that a bit of resilience is built in?
Keir Mather
The right hon. Member makes an important point about resilience on the railway; it complements the points made by the hon. Member for West Dorset about the fact that we live in a changing climate. That creates pressing resilience challenges across the breadth of the railway. The right hon. Member makes a good point about not being over-reliant on one technological mode. That being said, I hope that, through an overall transition towards decarbonised rail transport, alongside the other decarbonisation measures that the DFT is taking across the piece, we will be sufficiently resourced, capable and in pursuit of innovative solutions to make sure that electrification can play a prominent part in the future of the railway.
We believe that the way to achieve that is to have something more flexible to future direction and opportunities, such as GBR’s business plan, which is already provided for in the Bill. Of course, the rolling stock and infrastructure strategy might be more appropriate as a way to set out GBR’s plans for electrification rather than their being in the Bill.
We move to new clause 20, which would require GBR to work towards climate change targets. I assure the Committee that the environment will form an important part of GBR’s considerations through various mechanisms already included in the Bill. One of the strategic objectives for the long-term rail strategy will be environmental sustainability. GBR will have a duty to have regard to the Secretary of State’s long-term rail strategy and a general duty to make decisions in the public interest, which includes environmental considerations, when developing its business plan. Finally, it is important to point out that Network Rail is not currently directly obligated to deliver on those targets, but has still published “The Greener Railway Strategy”, which includes targets on net zero, climate adaptation, air quality, biodiversity and other environmental areas.
To conclude, we remain committed to addressing the environmental challenges faced not only by rail, which is already a comparatively green way to travel, but across all transport modes, and GBR will be an important partner in that work. I hope that hon. Members have been reassured and will consider withdrawing their amendments.
Jerome Mayhew
It is always a pleasure to hear the Minister explain the Government’s positions, but I remain unconvinced in relation to amendment 241, which I believe is the only one that can be put to a Division at this stage. I would like to press it to a vote.
Question put, That the amendment be made.
Edward Morello
It is excellent reading—something for the train on the way home. It lays out why the passenger charter is so key to delivering a better experience for rail users. The Committee will spend a lot of time talking about rail upgrades, shorter journeys, passing loops and all the things that we should discuss—it is easy to understand why we focus so much on shorter passenger journeys—but the passenger experience is also key. When I agreed to sit on the Committee, I said that if I achieved anything from it I hoped it would be the return of the buffet trolley to any train going anywhere near West Dorset.
Edward Morello
I could not possibly comment, Minister—I was going to say tea. But there are basic human rights that we should be respecting here—and a gin and tonic might be one of them.
On rail journeys lasting more than two hours, access to food and drink is a basic expectation. As anyone who has done the trip to Exeter or Dorchester South from London will know, numerous stations on that line do not have a café on the platform, or even one close by. I hope we are also going to achieve a reduction in the number of delays on that line, but once someone is on it they are on it; their options for access to anything are incredibly low. Whether for a parent travelling with children, older passengers on long journeys or commuters trying to work on the move, access to basic amenities—reliable wi-fi and food and drink—should be mandatory.
New clause 8 would require the Secretary of State, within six months, to introduce a passenger charter as a core function of GBR. It would set out clear expectations for passengers, and clear accountability for operators. As my hon. Friend the Member for Didcot and Wantage laid out in his ten-minute rule Bill, it would include guarantees on value for money, service quality, adequate seating for journeys over 30 minutes, and improved accessibility across trains.
Keir Mather
I thank the hon. Member for Didcot and Wantage for new clause 8 and amendment 130, and all right hon. and hon. Members who have offered contributions in support of the notion of seeking to require the Secretary of State to lay a passenger charter. I assure the hon. Gentleman that I am as zealous as he is in pursuing not only the rights of passengers, but their ability to have happy, fulfilled experiences on the railway—whether through a G&T, a cup of tea or whatever else.
Although I fully endorse the aim of raising passenger standards, I do not agree that a statutory passenger charter is the best approach. Great British Railways, not Government, needs to be in charge of the passenger offer, and it is being set up to be an expert-led directing mind, not a Government-led directive mind. There would be little value in reforming the system, only for the Government to continue to micromanage the railway, down to the level of specific seat designs.
Edward Morello
During my conversations with the sector, one of the challenges that came up about returning, for example, the buffet trolley or other services to trains is that services have already been sold on station platforms. There is direct and inherent competition between any service that someone might receive on the train and something that might be provided, and has already been sold, leased or franchised out, on the platform itself. How can the Government put passengers’ interests at the core of service delivery when they will have an inherent business or profitability conflict with some of the services that are already in existence?
Keir Mather
The hon. Member can intervene again if I have misunderstood his point, but I think there is a lot of utility in the fact that GBR, by being able to direct passenger services as well as having responsibility for long-term infrastructure such as stations, provides a coherent basis on which to tailor the passenger experience across the multitude of ways in which passengers engage with the railway and its infrastructure. From my perspective, it actually removes issues in cases in which competition may not be what is best for the passenger—where there is an offer in the catering car on their service down to London, but also a small business running a café from the station. We will have more of an opportunity to offer a holistic service for the passenger.
It is also important to me that we do not want to fix the passenger offer in statute. We want GBR to be able to adapt to passengers’ needs as they change over time. For example, I cannot imagine that many were thinking about wi-fi when the Railways Act 1993 was passed, but we know how fundamental it is to social and economic connectivity for passengers on the railway today.
To ensure that GBR does a good job of managing the passenger offer, the Bill will also establish the passenger watchdog, which will have strong powers to act in passengers’ interests. The Government and GBR will have to consult the watchdog when developing their policies, strategies and priorities for the railway, including when GBR is developing its business plan and passenger offer, and GBR will be expected to take account of the watchdog’s advice. The watchdog will also set minimum consumer standards, covering areas such as accessibility and passenger information.
The Secretary of State will have the opportunity to prioritise the needs of future passengers through the long-term rail strategy.
Edward Argar
The Minister has just said that the watchdog will have strong powers, but then uses words like “consultation” and “taking account of”. I have taken Bills through this place, and there are other words, like “should”, “could” or “must have regard to”—in fact, Bills rarely say, “must”; they normally say, “should pay attention to” or “should heed”. What actual powers will the watchdog have to compel GBR or the Secretary of State to take a particular course of action?
Keir Mather
That is a very important point. I thank the right hon. Member for his contribution. The passenger watchdog will have the ability to make sure that GBR is compliant with minimum consumer standards on accessibility and information—this will be an independent power to directly monitor the passenger experience—as well as investigation powers, including to demand information by a deadline. It will be fully established within 12 months of Royal Assent of the Bill, so it will be stood up quickly to provide the oversight that it needs to provide.
The Secretary of State will also have the opportunity to prioritise the needs of future passengers through the long-term rail strategy, as well as her statement of objectives, which must be addressed by GBR in its business plan, which itself must be signed off by the Secretary of State under the new funding process. It would therefore be inefficient and duplicative to create yet another document to achieve the same aims.
Let me turn briefly to delay repay. The passenger watchdog can set standards that relate to delay repay. It is namechecked as an example in clause 46, and delay repay will still be available under GBR. The Opposition spokesperson—
Keir Mather
Forgive me. The shadow Minister points to the fact that we have, in his view, a dearth of ambition when it comes to what we have set out in clause 18. I would actually argue the inverse—the standards set out in clause 18 relating to reliability of services, avoiding overcrowding and promoting the passenger experience are fundamental to creating the turn-up-and-go railway with a single directing mind that GBR seeks to achieve.
At the heart of it, these are the fundamental building blocks of the passenger experience. Layer on top of that the ways in which GBR will be nimble and dynamic enough under this legislation to lay out the passenger offer over time, and that creates a suite of measures that allow us to enhance, in the whole, the passenger experience. On that basis, I urge the hon. Member for Didcot and Wantage to withdraw the amendment.
Olly Glover
If you will indulge me, Sir Alec, I will briefly respond to the points that have been made. I thank the Minister for his comments. He will know from our past interactions on this that I very much agree with him that we definitely do not want the micromanagement and overprescription of GBR. That would be absolutely inimical to what I want to see happening, but there is a distinction to be made between setting the overall standards and the implementation of the work needed to meet those standards.
I do not read the rest of the Bill as quite saying, “We’re just going to let GBR crack on and define everything from scratch for itself”. Given the Minister’s comments about micromanaging, which I find encouraging, I look forward to hearing what he has to say about the later amendments that are designed to dilute the Secretary of State’s ability to interfere. Hopefully, given his comments, he might be minded to give them a fair hearing, but we shall see when the time comes.
The right hon. Member for Melton and Syston makes the good point that these things need to have teeth, and that is the intention of clause 8(2)(e), which would extend the delay repay principle to onboard amenities. Work would clearly need to be done to establish a sensible framework for the evidence requirement for people submitting claims—that would need to be thought through further—but that has not been prescribed here precisely because that would be a matter for GBR.
We also want to add teeth with subsection (2)(f), which is all about making it easier for people to claim compensation and allowing them to do so digitally rather than just on paper. In fairness, a lot of that has improved, and we hope it will continue to improve. I also want to address the very fair point made by the hon. Member for Bexleyheath and Crayford. The challenge with these things is always where to define the cut-off, but it should not be inevitable that commuters in south-east London, Greater Manchester or anywhere else should have to stand by default.
Rolling stock cuts without replacements on some routes—maybe not the hon. Gentleman’s, but elsewhere—have partly added to some of those problems. That includes the premature withdrawal of British Rail class 455 trains on Southern without a replacement and class 365 trains on the Great Northern network. A lot of these poor decisions were made following the pandemic to save cost in the short term, which has added to some of the overcrowding problems—many of which are preventable. We have included a 30-minute minimum duration in new clause 8 to try to be reasonable and to recognise that things are not always perfect.
In conclusion, we are putting a passengers’ charter forward because we feel that there is value in improving the onboard offer and making it consistent. There are things in the charter that would support other elements of the Bill by strengthening accessibility provision. For catering, my temptation would have been to go even further and wax lyrical about restaurant cars on Swiss railways or Austrian railways, which—if anybody has not enjoyed them—should be very welcome.
In Switzerland, even inter-city trains of just two hours always have a restaurant car, and they have a separate division for on-train catering, which is in-house—they take it very seriously. I have been on 55-minute journeys across Switzerland and have been attended to straight away. It is inexpensive and very good. I have decided not to be too prescriptive and to just talk about onboard catering. It is then for GBR, or whoever, to decide if they wish to embrace that particular bit of Swiss excellence, as well as electrification, as I mentioned earlier.
I think I have said more than enough, Sir Alec. I said earlier that we want to press new clause 8 to a vote. I expect I have to take guidance from the Clerk as to whether a vote on that or on amendment 130 would be most helpful—either is good with us.
Edward Argar
I regularly find myself agreeing with the hon. Member for West Dorset—possibly to the detriment of us both—on a whole range of things, and I agree with the Liberal Democrat spokesperson again on this occasion.
My hon. Friend the Member for Broadland and Fakenham is right to highlight that amendments 133 and 35 are not dissimilar in their intent and in what they seek to achieve. It is important, notwithstanding what the hon. Member for Birmingham Northfield says, that while we do recognise the desire and the need to drive up an increase in the use of railways for transporting freight, at the moment we risk disproportionately focusing on that to the detriment of traveling passengers. If there was any tension there, I would posit that freight may win out.
Yet in the Bill, it is the traveling passengers who will be not only paying for their tickets but essentially, as taxpayers, paying to subsidise or backfill any additional funding needed for the railways as a nationalised industry. Given that, it is vital that the passenger is front and centre of the thinking behind the Bill and how GBR comes into being. My hon. Friend the Member for Broadland and Fakenham rightly highlighted the importance of the culture of the organisation. It may inherit DNA from predecessor organisations, but GBR will be a new organisation, and that gives the Minister and the Secretary of State an opportunity to help shape that culture.
I have a genuine concern that in what is being done, the power of the passenger—of the paying public or the market—is diluted by virtue of creating what is essentially a state monopoly in GBR. What the amendments proposed by both my hon. Friend the Member for Broadland and Fakenham and the hon. Member for Didcot and Wantage seek to do is to put the passenger back into the mix in some way, and require that their voice has to be heard alongside that desire to drive up usage for freight. If there is a target or an obligation on GBR to drive up passenger numbers, it will have to be responsive to what passengers want, what they see and the experiences they have on the railways, which will drive them to use those railways more often.
I take the point made by the hon. Member for Birmingham Northfield, who knows of what he speaks. But at the moment, with the perfectly reasonable desire to increase the use of railways for freight, we risk that being unbalanced to the detriment of the passenger and their voice not being heard. For that reason, I am supportive of both amendments in seeking to make sure that the passenger remains front and centre of how GBR operates.
Keir Mather
I genuinely thank the shadow Minister, the Lib Dem spokesperson and Members from across the House for their considered and meaningful contributions on this matter. It shows the strength of feeling that we all have about making sure that the passenger experience sits at the heart of the way that our railways function. On the detail about the length of trains, which I agree is an interesting point that has been teased out in this debate, the rolling stock strategy that the DFT is bringing forward will have specific regard to the issue of train length. That will hopefully assuage some concerns.
The shadow Minister also pointed to the potential deficiencies in Network Rail caused by having an operational focus on the maintenance of infrastructure as opposed to promoting the needs of passengers. I would contrast that with the point that a lot of the issues that come with accessibility on the railway and sufficient provision of passenger services arise as much from the access regime and diffuse accountability as they do from cultural or institutional failings in Network Rail. In the current system, access is ultimately decided by the ORR and timetabling by National Rail, and we can end up with a situation where there is a 7 o’clock train from Manchester Piccadilly to London with no passengers on it. The existing system cannot put passengers at its heart, because its decision making process is too disjointed to be able to look at the railway in a holistic way. That is what the Bill is seeking to change.
As all amendments in the group relate directly to the notion of passenger numbers and increasing the number of passenger journeys, I will respond to them as a whole. As a commercial organisation, we believe that GBR will be naturally incentivised to drive up revenue through growing its passenger base and attracting more people to use the railway. GBR must also have the flexibility to determine how it can deliver on that ambition without adverse incentives, for example to congest the network at the expense of passenger experience, being established.
The Bill already includes a duty for sector bodies, including GBR, to promote the interests of users and potential users. That will require GBR to consider during decision making how to encourage new users on to the railway. That is a natural incentive to grow passenger numbers to enable them to realise the benefits of rail travel. That might include working towards encouraging modal shift, extending the network to areas with poorer connectivity or making informed choices to grow different types of services, such as leisure journeys.
In discharging its full remit of duties, including in particular its public interest and making efficient use of public money duties, GBR should make sensible, rounded decisions on where to target passenger growth across the network. It should do that in a sustainable way, and not to meet a passenger target frozen in aspic that might not be appropriate for the needs of the railway at the time. I urge hon. Members to withdraw the amendments.
Olly Glover
I thank the Minister for his comments. I do not doubt that his intentions are genuine and that he would like to see the Bill and GBR lead to greater passenger numbers, but I gently suggest that that cannot necessarily be taken as read. In periods in the past—arguably to a smaller extent since the pandemic, but to a much greater extent going back to the 1980s and before—there was an approach called managed decline. That was a Trojan horse for closing a line of route; intentional efforts were made to reduce passenger numbers. I do not think it can be taken as read that there will always be a desire to grow the network.
Keir Mather
May I test something from the hon. Gentleman’s perspective? The Secretary of State has a lot of oversight over how GBR functions under this new regime. One of her duties, and a duty for GBR, will be to ensure efficient use of public money. Do you not think that that creates a strong incentive for her to drive up passenger use on the railway to ensure that we have a balance of service? Going back to the point made by my hon. Friend the Member for Birmingham Northfield about the importance of freight, do you not think that the point about the essential correction for freight is important in a way that does not apply to passenger services?
The Chair
With this it will be convenient to discuss the following:
New clause 1—Purpose of Great British Railways—
“(1) The purpose of Great British Railways is defined by the following objectives—
(a) prioritising the needs of Great British Railways passengers in decision-making,
(b) delivering reliable, safe and accessible railway passenger services,
(c) providing value for money for passengers and taxpayers, including consideration of the affordability of fare prices,
(d) increasing passenger numbers and growing usage of the network year-on-year,
(e) expanding and improving the network, including services, connectivity, and restoring or adding routes,
(f) modernising working practices and innovating to improve productivity, efficiency, and passenger experience,
(g) supporting economic growth, national productivity and improving connections between towns, cities and employment centres,
(h) improving the experience of disabled and vulnerable passengers and ensuring consistent access to assistance,
(i) ensuring fair and transparent treatment of open access, freight and devolved operators when allocating access and charges,
(j) growing rail freight, including supporting delivery of the national freight growth target,
(k) strengthening the financial sustainability of the railways, reducing reliance on operating subsidy over time,
(l) integrating track and train, simplifying structures, and avoiding duplication, and
(m) supporting multimodal integration with buses, trams and local transport networks.
(2) The Secretary of State and Great British Railways must have regard to the purpose set out in subsection (1) in exercising their functions under this Act.”
This new clause defines Great British Railways’ purpose.
New clause 2—Great British Railways: Key Performance Indicators—
“(1) Within six months beginning on the day on which this Act is passed, the Secretary of State must lay before Parliament a framework of key performance indicators for Great British Railways (the ‘framework’).
(2) The framework must include targets for each of the following key performance indicators—
(a) reliability, including punctuality, cancellations, short-forming, delays and the reliability of key connections,
(b) safety and security, including safety incidents, security incidents affecting passengers, staff presence, and delivery of safety-critical maintenance,
(c) comfort and on-board experience, including cleanliness, functioning of heating, air-conditioning, and lighting, overcrowding, availability and performance of an internet connection, power sockets and toilet facilities,
(d) affordability and value for money, including the level of fares, availability of discounted fares, availability of flexible fares, transparency of information about fares, and passenger perception of value for money,
(e) passenger growth and network expansion including growth in passenger numbers, number of communities served, service frequency, and provision of new or restored services,
(f) financial sustainability, efficiency and productivity including operating subsidy levels, productivity improvements, delivery of projects on time and on budget, simplification of processes, including an explicit savings target set by the Secretary of State, and
(g) freight growth and performance including rail freight volumes, punctuality, reliability, allocation of freight paths and capacity at pinch points.
(3) Within three months of the end of each financial year, Great British Railways must publish a report on its performance against each part of the framework under subsection (2) during the previous financial year.
(4) The Secretary of State must lay any report required by subsection (3) before Parliament.”
This new clause requires the Secretary of State to set a statutory KPI framework for Great British Railways.
New clause 5—Great British Railways: reporting requirement—
“(1) Great British Railways must publish an annual report.
(2) The annual report must include Great British Railways’ performance against its key performance indicators as set out in section [Great British Railways: Key Performance Indicators].
(3) Great British Railways must publish quarterly updates on its performance against its key performance indicators as set out in section [Great British Railways: Key Performance Indicators].”
This new clause would require Great British Railways to report annually and quarterly against its key performance indicators.
Keir Mather
I will first address clause 3, and then listen to Members’ comments on the new clauses before responding to them in full.
Clause 3 is fundamental to establishing Great British Railways as the integrated rail body that this country needs. It sets out GBR’s statutory functions, which provide a list of things that GBR is here to do, fulfilling ministerial commitments to set out GBR’s purpose in the Bill. This is not just a technical provision; it is the foundation for a simpler, more accountable railway system.
Currently, responsibilities for managing infrastructure, operating services, setting fares and driving innovation are fragmented across the sector. That fragmentation has led to inefficiencies, duplication, and a lack of clear accountability. The clause addresses that by providing GBR with the statutory basis for bringing those functions together under one roof. It empowers GBR to act as the directing mind for the railway.
GBR will look after railway infrastructure, which includes maintaining it, operating it and making decisions on who can access it. It will provide railway passenger services, set and manage fares, sell tickets or secure that tickets are available for sale. It will provide services that help to run the railway and make it easier for customers to use, even when those railway services are provided by other operators. It will carry out research and development, support innovation, and publish advice and standards to improve the railways. Those functions do not limit GBR, however. The clause also clarifies that GBR can exercise company powers under existing law, so that it can act as a fully commercial organisation, and it provides GBR with appropriate operational flexibility by enabling the statutory functions to be exercised by its subsidiaries.
In short, the clause sets the statutory foundation for a railway that works as one system and is simpler, more efficient and more accountable. Without the clause, it would not be clear to GBR, or to anyone else, what GBR is here to do. I commend the clause to the Committee.
Jerome Mayhew
I do not propose to divide the Committee on clause 3. If the Bill is going to progress, then some version of the clause needs to be in it. We are doing our best to improve it; we have not been successful so far, but I have not given up hope—there is more to come.
New clause 1 is a purpose clause. One of the very obvious gaps in the Bill is that there is no clause setting out its purpose. It is based on a number of objectives, which are set out in subsection (1)(a) to (m)—13 paragraphs. Paragraph (a) sets out the mission that the priority in decision making should be the needs of GBR passengers. That builds nicely on the discussion we have just had.
With a nationalised organisation, we need to go the extra mile to clarify exactly what its focus should be, because it is, by design, a top-down command structure of the state. In a functioning—I stress “functioning”—competitive market, the market will force operators to focus on their passengers, because the passengers are also their customers and that is how they grow their profits. When we take the deliberate decision to move away from market competition, something has to replace it, and the only thing that can replace it is the legislative process. That is why the new clause is so necessary. The priority in decision making needs to be GBR passengers; although we can infer this from statements by the Government, enshrining the mission statement would ensure that it remained a beacon for the organisation to follow.
Paragraph (b) states the objective of
“delivering reliable, safe and accessible railway passenger services”.
I do not think that that is controversial for any of us. Paragraph (c) sets the aim of
“providing value for money for passengers and taxpayers, including consideration of the affordability of fare prices”.
With a state service, the public expect value for money to be the driver, to ensure continued investment and reinvestment in our rail network. At the moment, fares remain a key concern of passengers and taxpayers. The affordability of fares must be one of the primary objectives.
Paragraph (d) points to increasing passenger numbers and growing usage of the network. We do not want to see what happened during the nationalisation era, when service quality fell and people consequently turned to other modes of transport when reliability decreased. Keeping people adopting the railways, as we have seen explode under privatisation, is very important. That links nicely with paragraph (e), which would ensure that the network is continually expanded and improved, with constant analysis of service and connectivity improvements as well as restoring and adding routes.
Keir Mather
Let me first pick up on the points made by the hon. Lady as they relate to devolution, which is incredibly important. We will cover it in more extensive detail later, but it has a material impact on the new clauses we are considering. She is right to point to the fact that mayoral strategic authorities are the lens through which GBR intends to play out its devolution work under statute. That is because we believe that mayoral strategic authorities provide the right lens through which to use the transport network—the rail network in particular—as a catalyst for economic and housing growth. That is due to the powers that devolved mayors have in that space.
I also wish to reassure the hon. Lady that GBR’s ability to engage with local authorities will go far beyond just mayoral strategic authorities. That plays into an important consideration about the structure of GBR as an organisation, which we want to be a lot more flat and a lot more concentrated on ensuring that it can make an important regional difference in every part of the United Kingdom. Through the business units of GBR, we will be able to facilitate that work.
What we do not want to do, however—given any future Government aspiration for more places to have mayors—is to freeze a patchwork programme of devolution into legislation in a way that does not allow us to work closely with a range of devolved areas in future. GBR will be able to engage in that work comprehensively with local authorities, irrespective of whether they have a mayor.
On new clause 1, which seeks to add a purpose to the Bill, I am pleased to say that it largely mirrors provisions that already exist. I confirm that the Bill already makes that clear through the combination of GBR’s statutory functions, which set out what we expect GBR to do, and the shared general duties in clause 18, which set out what we expect it to consider and achieve. Taken together, the functions and duties already set out GBR’s fundamental purpose.
In addition, the duties in clause 18 can already cover the breadth of the outcomes that the proposed new clause is driving at. For example, sector bodies including GBR, and the Secretary of State, will be required to make decisions in the public interest, which includes social and economic benefits. The duties in the Bill are those that will endure and should be at the core of any railway. Instead of setting out a clear purpose, new clause 1 would duplicate many of the provisions already in the Bill and actually make GBR’s purpose significantly less clear.
New clauses 2 and 5 would set key performance indicators for GBR and introduce a requirement for GBR to publish an annual report on them. I can certainly support the intention of the hon. Member for Broadland and Fakenham that GBR should have a comprehensive set of performance objectives against which it is robustly held to account. I disagree with him, however, on where and how those indicators should be implemented. The right place for GBR’s KPIs is in its integrated business plan, alongside the detail of what activity GBR will be carrying out over the five-year funding period.
There are three main reasons for that, and I also point to the fact that the arrangement is mirrored in other public organisations, such as National Highways, set up by the previous Conservative Government in 2015—its KPIs are not included in primary legislation. First, the indicators should be realistic and measurable, meaning they also need to be grounded in GBR’s specific proposals for delivery. Therefore, it is appropriate that the indicators are developed as part of the business plan, rather than in legislation.
Secondly, key performance indicators need to be able to evolve over time as the railway network and customer needs change. The way an indicator is set out can influence how an organisation behaves, and we should be able to refine the indicators over the course of several funding periods to get GBR to deliver in the way it needs to. Therefore, a more flexible process, such as that used for developing the business plan, works much better than fixing the indicators in legislation.
Finally, it is important that the ORR, in its role of scrutinising GBR’s proposed plans and monitoring GBR’s delivery, is able to assess whether commitments made by GBR are ambitious but also realistic. As the independent expert adviser to the Secretary of State, the ORR should have a clear route to influence the formulation of GBR’s key performance indicators. By keeping them within the business plan, the ORR’s involvement is ensured by legislation. Unlike legislation, the integrated business plan will also be updated, likely on an annual basis, and it can only be updated following scrutiny from the ORR and the new passenger watchdog, which in my view provides additional flexibility and accountability.
I hope that the hon. Member for Broadland and Fakenham can agree that GBR’s business plan is the right place to develop and set GBR’s performance indicators. Given my explanation, I encourage him not to press his new clauses to a vote.
Jerome Mayhew
I am grateful to the Minister for setting out his defence of the Bill. The problem with his argument is that, because the Government have gone off half-cocked, the Committee is not in a position to assess whether he is right or wrong on the nature of the KPIs, or even on where they should be, because we have not been furnished with any draft copies of the documents to which he refers. In those circumstances, I feel obliged to press the two new clauses to a vote.
Question put and agreed to.
Clause 3 accordingly ordered to stand part of the Bill.
The Chair
With this it will be convenient to discuss new clause 30—Rail devolution: Wales—
“(1) Schedule 7A of the Government of Wales Act 2006 is amended as follows.
(2) In Section E2 (Rail Transport), omit paragraph 117.
(3) Within two years of this Act receiving Royal Assent, the Secretary of State must lay before both Houses of Parliament regulations providing for the transfer of functions relating to rail services in Wales to Welsh Ministers.
(4) The functions transferred under subsection (3) must include, but are not limited to, responsibility for—
(a) railway infrastructure in Wales;
(b) the specification, provision and regulation of railway passenger services in Wales;
(c) the development, publication and implementation of a Welsh Rail Strategy;
(d) the funding, planning, delivery and maintenance of rail enhancement and renewal projects in Wales; and
(e) the regulation of access, capacity, charging and performance arrangements for rail infrastructure in Wales.
(5) No regulations may be made by the Secretary of State under this section unless they have been laid in draft before, and approved by, both Houses of Parliament.
(6) On the same day that the regulations specified in subsection (3) are laid before Parliament, the Secretary of State must also publish a statement of rail funding detailing the additional funding to the Welsh Consolidated Fund that will be made by His Majesty's Government as a result of rail devolution.
(7) This section comes into force on the day this Act receives Royal Assent.”
Keir Mather
Clause 4 enables Scottish and Welsh Ministers to delegate their railway functions to Great British Railways, a subsidiary of Great British Railways, or a company jointly owned by Scottish or Welsh Ministers and Great British Railways. That means that, if they wish, those Ministers will be able to take advantage of the benefits of GBR’s joined-up approach of bringing track and train together.
Scottish and Welsh Ministers must consult GBR and the Secretary of State before entering into any delegation arrangement with GBR, and transparently publish the terms of the arrangement. The clause confirms that when GBR delivers functions for Scottish or Welsh Ministers, it continues to comply with its own obligations under the Bill, such as its duties.
The clause provides flexibility and choice for Scottish and Welsh Ministers in how rail services are delivered in Scotland and Wales. It allows for innovative options, such as vertically integrated joint ventures, which can deliver the full cost efficiencies and performance improvements that track and train integration will bring to England, with opportunity for those benefits to extend to Scotland and Wales as well. This approach is in line with our manifesto commitment to deliver the benefits of rail reform to the whole of Great Britain and has the full support of the Scottish and Welsh Ministers. I commend the clause to the Committee.
Jerome Mayhew
I thank the Minister for his brief explanation of the clause. Under clause 3, the Committee was able to discuss the principles of the future structure of GBR, but clause 4 is the first instance of one of the open wounds that the Bill might create.
The devolutionary functions of the Bill seemingly reopen aspects of the West Lothian question by failing to provide clear lines of power between the devolved nations, regions and Whitehall. The elephant in the room is the future surrounding England and Wales projects. We know from the evidence we heard that the Welsh railway is very different from, for example, the Scottish railway; 80% of all rail travel in Wales is cross-border, so it includes elements of English travel, as we can tell by Labour’s recent announcement that East West Rail and the Hull to Liverpool lines are being classified as England and Wales projects. Some members of the Minister’s party in Wales might think that is a bit of a stretch at the very least.
The Government’s position has consistently been based on the fact that infrastructure is not subsequent to Barnett consequentials in Wales, and therefore should not be allocated to Cardiff Bay. However, the Minister’s own Labour party colleague in the Senedd, Cabinet Secretary for Economy Rebecca Evans MS, said:
“Wales will have missed out...as a result of the incorrect classification of HS2 as an England-and-Wales project.”
That was Labour’s position when it sat on the Opposition Benches, and it is seemingly still the position of the Labour Government in Cardiff. Is it still the position of the Minister and of Labour?
Clause 4 allows the Scottish and Welsh Governments to maintain their nationalised railway structures within ScotRail and Transport for Wales. It is prudent that the Government maintain their and GBR’s final say in these matters, as set out in subsection (2). However, much of the relationship is predicated on the memorandum of understanding, which is missing in action and is not explicitly established in the clause. It is important to ensure that the Government are thinking clearly about the nature of the relationship they wish to maintain with the devolved nations, as this framework will exist within the future memorandum of understanding—which none of us has seen. That will be particularly important should the Wales Act 2017 be amended at some stage, given that Welsh devolved powers are a live political issue. Will the Minister explain Government’s approach to future transport devolution in Wales, given his party’s comments on rail funding?
Olly Glover
I wish to speak in favour of new clause 30, tabled by my hon. Friend the Member for Brecon, Radnor and Cwm Tawe (David Chadwick), who is the Liberal Democrat spokesperson for Wales. His new clause seeks to remove rail transport from the list of powers reserved to Westminster and to require the UK Government to transfer responsibility for rail in Wales to Welsh Ministers in the Senedd within two years. In practical terms, that would mean responsibility for rail infrastructure, investment decisions and long-term strategy in Wales sitting with the Welsh Government, rather than being controlled by the UK Secretary of State or Great British Railways. It would put Wales on the same constitutional footing as Scotland, which already has those powers.
The reason this matters is that, under the current arrangements, Wales has consistently lost out. Because rail is not devolved, Wales has no protection when England-only rail projects are classified in ways that deny Wales consequential funding. That has resulted in Wales missing out on billions of pounds of investment from projects such as HS2, Northern Powerhouse Rail and East West Rail, while the Governments in Scotland and Northern Ireland have received consequential funding to spend on their own rail projects.
The new clause would align responsibility and accountability, and ensure that decisions affecting Welsh rail are made in Wales. I believe that this was a campaign backed by Welsh Labour MPs prior to the general election, so I look forward to hearing the Minister’s comments.
Keir Mather
I thank hon. Members for their contributions. I will start by addressing new clause 30, which would require the full devolution of responsibility for rail services and infrastructure in Wales.
The Bill is designed to bring strategic direction, accountability and oversight of the rail system into a single coherent framework, reflecting the fact that railways operate as an integrated cross-border network. Reserved powers play an important part in maintaining that integration. Retaining responsibility for rail infrastructure at UK level supports coherent strategic planning, consistent standards and efficient operation across England and Wales, including on routes that serve communities on both sides of the border.
The new clause would introduce new statutory boundaries into a network when we most need to simplify governance and reduce fragmentation. By reopening the devolution settlement and mandating the transfer of responsibilities that are already being addressed through strengthened partnership working, it risks diverting attention from implementation and delivery. The Bill already enhances joint working.
Andrew Ranger (Wrexham) (Lab)
The debate around the devolution of rail in Wales is absolutely worthy of further consideration, but I am not convinced that it would be right to do so as part of this Bill, which surely has to reflect the current situation, as the Minister is rightly pointing out. We heard evidence from a Transport for Wales official that they really welcomed the partnership working between the UK Government, the Welsh Government and TfW, as well as future collaboration and the work that has been done on the heads of terms for the memorandum of understanding. They felt that the progress made is moving us towards a different scenario, but we need to work with the situation as it stands now.
Keir Mather
My hon. Friend echoes a theme that we have heard throughout this debate: that those who live closest to the railway and the service it provides know best about its operation, and that includes on a devolved basis. He also rightly points to a number of themes that were brought to light during oral evidence by the representative from Wales, who pointed out that developing operational understandings, as we are with the Scottish and Welsh Governments through the MOU, is an iterative process done on an operational level, and freezing it in aspic is therefore not to be advised. The heads of terms already exist for Members to scrutinise.
The Bill already enhances joint working, improves accountability and safeguards the benefits of an integrated cross border railway. The approach in the Bill will be supported by the memorandum of understanding between UK and Welsh Ministers, which will set out arrangements for co-operation on matters such as cross border services and infrastructure interfaces. This provides a clear and structured basis for engagement with Welsh Ministers without requiring the statutory transfer of reserved rail functions or creating additional legislative complexity and uncertainty.
The new clause would require a separate statement on funding for the Welsh consolidated fund. That is not necessary, as information on funding for Wales is already published through established mechanisms, such as His Majesty’s Treasury’s fiscal documents on spending reviews and block grant transparency publications, which provide clear and routine transparency without creating a rail specific statutory process.
The new clause risks undermining the integrated approach set out in the Bill by requiring changes to reserved matters that could weaken the coherence of the rail network. The Bill as drafted has the full support of the Welsh Government and preserves the existing devolution settlement. I therefore urge hon. Members not to move the new clause and commend clause 4 to the Committee.
Question put and agreed to.
Clause 4 accordingly ordered to stand part of the Bill.
Clause 5
Co-operation with relevant local government bodies
Jerome Mayhew
I beg to move amendment 232, in clause 5, page 3, line 37, at end insert—
“(2A) Where no arrangement between Great British Railways and a relevant local authority exists, the relevant local authority may appeal a decision made by Great British Railways affecting passenger rail services within its boundary under section 67.”
This amendment is designed to give Mayors the right to appeal GBR decisions to alter passenger services in their area to the ORR in the event of no partnership existing.
Rebecca Smith
I will touch briefly on two points that are not necessarily related, but overlap. First, let me build on what my hon. Friend the Member for Broadland and Fakenham said about the word “may” in clause 5(1). Anyone who was at the oral evidence session earlier this week would have heard the Manchester and west midlands mayors talking about wanting a meaningful relationship. They could not pinpoint exactly what meaningful would look like, but the gist was a desire to make sure that the relationship has some “oomph” or a decent foundation to it. I am therefore concerned about the use of the word “may”. Will the Minister define what “may” means and when “may” might happen? Ultimately, that is potentially the biggest get-out clause for not having to act. I know that that is not the intention, but I do not think that the Bill as drafted clearly describes that.
I referred earlier to the general premise of devolution and the Minister tried to reassure me about devolution outside strategic mayoral authorities, but I still do not think that the Bill is clear enough about what is going to happen. Given that the Bill sets up a railway system that the Government hope will last forever, it is not clear how other parts of the country will come into play. The Transport Committee has debated that and heard lots of evidence as well. The question remains. While I appreciate the Minister’s reassurances, they do not go far enough to help me and many others across the country to understand what is in the Bill for them regarding local control and power.
We have debated changing language today and I have already talked about the potential for referring to “local transport authorities”. I am intrigued about why subsection (5)(c) is the end of the line. It refers to a
“Passenger Transport Executive for an integrated transport area.”
Why does this not go further? We know that the Government have huge intentions for devolution and local government re-organisation but, despite their best intentions, that might not come to pass in the way they think.
How can the Bill be changed to reflect areas of the country that do not have a mayor or any of the bodies included in subsection (5)? How will the Government ensure that the whole country benefits from GBR, not just those areas that have great, charismatic mayors—of all colours? They keep being brought in front of the Select Committee as the solution to all of our transport problems, but unless other areas in the country get a mayor, they will not see the benefits of any of it. I know that that is the Government’s intention, but I genuinely do not think that it will be the reality for a number of years.
Keir Mather
I turn first to the definition of “may”, which feels as philosophically profound a point as it does a political one. I interpret “may” differently to the hon. Lady. Mayoral strategic authorities, and other local government organisations across the piece, have incredibly divergent aspirations, ambitions and existing structures through which they may want to realise their local transport opportunities and overcome challenges. Using “may” gives them the opportunity to explore the full range of them in a way that is not over-prescriptive. If we combine that with the role that mayors can have in the system to exercise accountability, that provides sufficient safeguards for the mayoral piece of the puzzle.
More broadly, building on the point made by the hon. Member for South West Devon and the right hon. Member for Melton and Syston about what the reality could look like, it goes back to the operational reality that we do not want GBR to be set up as a highly consolidated, top-down organisation that does not have a presence in local people’s communities. On the other hand, GBR’s integrated business units will provide closeness both to the people who maintain assets that are directly related to the railway, and to local government representatives, who will have a very refined view of how the system meets passengers’ needs.
Rebecca Smith
The Minister’s point speaks directly to something else I am concerned about: how the business units relate to local government areas. His explanation still uses language that makes it sound like the authorities will be much smaller, granulated local authorities rather than larger strategic ones. Can the Minister help me to understand how the business unit will work in an area that does not have a mayoralty—that top level of devolution—in place?
I do not want to be parochial, but two railway companies currently provide services in the south-west, and there are three in the far south-west, if we look at some of the other routes down from London to there. If there is a business unit, what is it controlling? Is it controlling the entire south-west? Is it controlling the railway company providing that service? Does it have to be linked to a level of devolution, or will it exist anyway, meaning that local councils, such as the one in my area, would still refer to them?
Keir Mather
The hon. Lady will have to forgive me, but I do not want to be over-prescriptive, and that is for two reasons. The first is that, as she outlines, there are very different cases in different local areas, and I want integrated business units that are set up as part of GBR to be responsive to those particularities. Those matters are part of operational design, which necessarily does not sit in the Bill, because we do not want GBR to be frozen in aspic through legislation. We want its operational workings to be future-focused and agile, as we would want any private organisation to be, which the shadow Minister has outlined.
Secondly, however—this relates to the Conservative and Liberal Democrat amendments—I do not want to create phantom clauses in the Bill and build in accountability structures for council systems that may be replaced by mayoral strategic authorities. We talk a lot about Christmas tree Bills in this place, but I envisage this as more of a bonsai Bill, with each part perfectly formed and maintained, so I do not want to put provisions into statute that quickly become irrelevant.
I thank the shadow Minister for tabling amendment 232, which would create an appeals process for relevant local authorities when a GBR decision affected rail services in their area. The Government support a more locally focused railway and an enhanced role for mayoral strategic authorities. Local partners know their areas best, and that is why GBR will agree partnerships with mayoral strategic authorities to enable close collaboration and joint working on local priorities.
We believe that the amendment is not necessary because clauses 81 to 84 require GBR to consult with mayoral strategic authorities and receive advice from relevant local authorities. Those are the proposed mechanisms through which mayoral authorities will be engaged when one of GBR’s decisions could have a significant impact on the local area. At that point, GBR can receive advice from relevant local authorities and will co-operate with them to find a workable solution. It does not make sense to require a statutory appeals process for something that engagement via other routes can easily solve. I also point to the fact that mayors can appeal the capacity plan or appeal against access decisions if they are aggrieved by them. They can also go to the ORR if GBR ignores the transport strategy, under the existing legislation.
The shadow Minister raised a really important point about the partnership practitioner guide, which was published earlier this month to set out how those partnership models might work. He asked me to point to which functions we have in mind through those models. It could be mayors agreeing local fare packages with GBR as they relate to passenger services, such as through the Bee Network. Hopefully that provides him with a little more detail, but if he has subsequent questions, I will be happy to answer them.
Amendment 214 would enable GBR to enter into arrangements with all tiers of local government, rather than just mayoral strategic authorities. As I have mentioned, the provisions in clause 5 are pitched at that level to reflect the growth of MSAs across England and the role that mayors can play in convening local partners and tackling regional challenges. That level of authority also represents the appropriate scale and capability for integrating rail with wider public transport, and the provision on the intersection with buses is obviously of great importance to the Committee.
Rebecca Smith
I thank the Minister for the further detail that he has provided. A lot of these regions feed into London and the big cities. If local councils are holding their local business units to account, how does that connect with services going from those regions to big cities such as London or Birmingham?
Keir Mather
The hon. Lady’s comments speak to the advantage of an integrated railway with a single point of accountability—whether that be at the local level, or through an integrated business unit or GBR’s HQ functions in Derby. The reason for having integration is that accountability is not diffuse, as one single point of contact at the local level can radiate through the system to ensure that local residents get what they need. Beyond that, there are the duties that underpin GBR’s need to promote the interests of passengers as being both a national consideration and something that local businesses should have regard to.
Clause 5 also enables GBR to co-operate with relevant local government bodies, such as MCAs, by entering into formal partnership arrangements with them or by sharing information. The clause does not detail what the co-operation arrangements should be, as every local area is different, but arrangements could include local authorities funding GBR for additional services or enhancements beyond the national baseline. The information-sharing provisions can also allow for more integrated transport planning, for example, so that new bus stations can be located alongside new train stations. This provision enables GBR to co-operate with local authorities, allowing local areas the opportunity to genuinely shape the railway and have greater influence over services.
I have heard from many mayors and MPs that this is how the railway should work, and I know that a lot of members of the Committee have local priorities that the clause can help to deliver. In the future, GBR will be accountable for every part of the railway, and it should be able to do sensible business with every Member of Parliament to get the right outcomes for everyone. I commend clause 5 to the Committee.
Jerome Mayhew
I listened carefully to the Minister’s explanation as to why, in his view, amendment 232 should be withdrawn. He said that GBR will agree to co-operation with mayoral combined authorities. He also said that other parts of the Bill contain a duty to consult and a requirement to receive advice from mayors, but there is no requirement to listen to that advice. As a result, the decision-making power remains with GBR, not the regional area that is most affected by the decisions, which the Minister, on a number of occasions today, has already said is best placed to decide the needs for its local community. That is fine—if the Minister wishes to keep the word “may”, it is, of course, his right to do so. However, if the less powerful of the two people in the relationship disagrees with GBR’s decisions, they need to have some form of recourse to an appeal. For that reason, I believe that the appeal process set out in amendment 232 remains important and that the amendment should be put to a vote.
Question put, That the amendment be made.
Daniel Francis
It is a pleasure to serve under your chairship, Sir Alec. As a Member of Parliament for a London constituency, and as a former member of the London TravelWatch board who understands some of the passenger watchdog issues in London, it is incumbent on me to speak to some of the clauses.
Of course, the GLA Act 1999 originally gave the liaison power to the Strategic Rail Authority, not the Secretary of State, and it was the Railways Act 2005 that amended the words “Strategic Rail Authority” to “Secretary of State”. Clause 6 will in fact put back the relationship that was there in the original 1999 Act, so that the actual rail operator, rather than the Secretary of State, has that liaison right with Transport for London.
Look at how the passenger interacts with some of those services. Some people living in the very northern part of my constituency—I have a very small part of Abbey Wood in my Bexleyheath and Crayford constituency—use Abbey Wood station, where rail usage has trebled since before the pandemic. During that time, we have seen the introduction of the Elizabeth line and the nationalisation of Southeastern, and the station has been transferred from Southeastern’s operation to Transport for London’s. Yet there are three different railway services serving that station: the nationalised Southeastern, the privatised Thameslink and the Elizabeth line, which is operated by Transport for London. There therefore absolutely has to be liaison by the operator, not the Secretary of State. Under this arrangement, Southeastern and Thameslink would come under one ownership, under Great British Railways, and with Transport for London.
Also, if my constituents catch the Bexleyheath or Barnehurst service to London Victoria, or to Denmark Hill, if they are using King’s College hospital, they will use a service that is currently operated by Thameslink but on a line that also has Southern and Southeastern services on it, as well as TFL services on the Windrush line. The liaison power should therefore be with the operators, not the Secretary of State. If we went down the Opposition’s route, we would be saying that that liaison should be between the Secretary of State and the Mayor of London. However, it should rightly be between the rail operators, given that stations such as Denmark Hill or Abbey Wood have Transport for London services, and there will be some stations operated by Transport for London, but some stations, such as Denmark Hill, will be operated by Great British Railways. That is where the liaison powers should lie, and as I say, that will bring us back to the original arrangement under the 1999 Act. For those reasons, I oppose the amendments and support clause 6.
Keir Mather
Let me begin by addressing the point made by the shadow Minister about the discrepancies in the system in Greater Manchester as it applies to London. It is not wholly correct to say that we are treating these two things inherently differently. The co-operation clause, which applies to all MCAs including Manchester, is new, but for TfL it is also set out in the GLA Act. To make this work for TfL, we have therefore to tweak the legislative system.
I thank the shadow Minister for his amendments 7 to 10, which together propose including the Secretary of State, alongside Great British Railways, in the clause requiring co-operation with TfL. Clause 6 requires that GBR and TfL co-operate on railway matters. That includes co-ordinating TfL and GBR passenger services and sharing relevant information. It will also enable GBR to work collaboratively with Transport for London to strengthen its local influence over the railways and support integration with other transport modes.
The railway responsibilities included in the clause, such as the co-ordination of passenger services, will be GBR’s, not the Secretary of State’s. Including the Secretary of State here would risk undermining the principle that GBR is the railway’s directing mind, and would widen the scope of the Secretary of State’s role under the new regime.
The shadow Minister will have heard the Government make clear commitments that this will not be a railway run by politicians. Clearly, the Secretary of State does not need to be involved in GBR’s relationship with Transport for London or in its passenger service responsibilities. Those relationships are operational ones and do not need political interference. I therefore urge him not to press his amendments to a vote.
Jerome Mayhew
I am grateful to the Minister for his explanation, and to the hon. Member for Bexleyheath and Crayford for giving his lived experience of the TfL area. I am partially convinced. I will not press this amendment to a Division, so I think we can move on.
I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Keir Mather
I beg to move amendment 165, in clause 6, page 4, line 25, after “functions” insert
“(within the meaning of the Railways Act 2026)”.
This amendment defines GBR’s statutory functions in the substituted section 175(3) of the Greater London Authority Act 1999.
The Chair
With this, it will be convenient to discuss Government amendments 156 and 157.
Keir Mather
The Government are committed to creating a more locally focused railway under GBR. Provisions in the Bill and ongoing engagement with local government partners demonstrate the strength of that commitment.
These amendments are primarily technical in nature, but they will support more effective co-operation on local railway matters. Amendments 156 and 157 bring freight into the scope of clause 6, which requires GBR to co-operate with Transport for London on railway matters.
Clause 6 amends section 175 of the Greater London Authority Act 1999, which requires the Secretary of State and TfL to co-operate with each other on passenger services. I have already spoken about why we are transferring this duty to co-operate from the Secretary of State to GBR. However, since GBR will be the directing mind of the railway, an operator of passenger services and the manager of its network, it is now appropriate for this duty to include both freight and passenger services.
This Government recognise the importance of freight and intend to ensure that freight is promoted within the Bill, as well as in future engagement between GBR and TfL. It was always this Government’s intention that GBR and TfL should work effectively together in the reformed railway. These amendments ensure that that can happen in a holistic way.
Amendment 165 is a minor drafting amendment to ensure that when people read the Greater London Authority Act 1999, they know to refer to this Bill to find out what GBR’s statutory functions are.
Jerome Mayhew
I agree with the Minister’s characterisation that these are largely technical or tidy-up amendments. It is right to include freight in the duty to cooperate with TfL. I am glad that the Government have tabled these three amendments and we have no objection to them.
Amendment 165 agreed to.
Amendments made: 156, in clause 6, page 4, line 26, after “passenger” insert “and goods”.
This amendment and amendment 157 add GBR’s statutory functions in relation to freight services to the functions in relation to which GBR must co-operate with Transport for London.
Amendment 157, in clause 6, page 4, line 26, at end insert—
“(7) In subsection (3A)—
(a) after ‘passenger’ insert ‘or goods’, and
(b) after ‘passengers’, in both places it occurs, insert ‘or goods’.”—(Keir Mather.)
See the explanatory statement for amendment 156.
Question proposed, That the clause, as amended, stand part of the Bill.
Keir Mather
Clause 6 amends the Greater London Authority Act 1999 by updating section 175. This will update the current statutory basis for TfL’s co-operation on railway matters by replacing references to “the Secretary of State” with references to “Great British Railways”. This includes co-ordination regarding TfL and GBR services, and requirements to share relevant information. It also enables GBR to work collaboratively with TfL to strengthen its local influence over the railways and support integration with other transport modes.
These arrangements may include financial contributions from TfL to GBR for additional services or enhancements beyond the national baseline. For example, TfL could commission GBR to increase train frequencies on suburban routes, or to improve station facilities to align with the Mayor of London’s transport strategy. Information-sharing will also enable integrated planning, improving co-ordination between GBR services and TfL’s multi-modal network.
That approach reflects the Government’s commitment to empowering local leaders through statutory roles and supporting integrated transport solutions. This collaborative working will help to deliver better outcomes for passengers and communities by aligning rail services with London’s priorities. I commend the clause to the Committee.
Jerome Mayhew
The Minister has set out his views on this clause clearly. We have already explored the difference of opinion about whether or not it should be the Secretary of State and GBR that collaborate with TfL. However, the direction of the clause is an eminently sensible one and we do not wish to stand in its way.
Question put and agreed to.
Clause 6, as amended, accordingly ordered to stand part of the Bill.
Ordered, That further consideration be now adjourned.—(Nesil Caliskan.)
Railways Bill (Third sitting)
Keir Mather ExcerptsThursday 22nd January 2026
(2 weeks, 3 days ago)
Public Bill CommitteesRead Full debate Railways Bill 2024-26 View all Railways Bill 2024-26 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Public Bill Committee Amendments as at 22 January 2026 - (22 Jan 2026)
The Chair
We now look forward to the Minister responding on amendment 257, and on new clauses 24 and 38, although he might be relieved to hear that he does not have to make a decision on those today.
The Parliamentary Under-Secretary of State for Transport (Keir Mather)
It is a pleasure to serve under your chairmanship, Mrs Hobhouse. May I begin by saying how much I look forward to working with all members of the Committee as we advance the priorities in the Bill and hopefully have a robust debate as we do so?
First, I turn to amendment 257 tabled by my hon. Friend the Member for Birmingham Northfield. I also want to reciprocate his warm words about the conversations he has been able to have with me and the Rail Minister Lord Hendy on this provision. Let me reassure him that public ownership of our railways is what the Government are delivering, as set out in our manifesto, and that we are steadfast in our commitment to it. We are already seeing the benefits of bringing train operators into public ownership, with passengers being put back at the heart of the rail network. Passengers can now use their tickets on another public sector operator at no extra cost during disruption.
Through working with Network Rail, Southeastern increased capacity to popular seaside spots in the summer months. Since moving into public ownership, South Western Railway has more than quadrupled the number of new Arterio trains in service, directly benefiting passengers. Public ownership sits at the heart of the Bill, as my hon. Friend notes is the case in other legislation passed by this Government, to ensure that we gradually take our railways back into public ownership in the interests of passengers. However, I take his point that it is important to safeguard the legacy of these essential reforms for generations to come. I will take that thought away. In the meantime I encourage him to withdraw his amendment.
New clause 24 would require the Secretary of State to appoint a Great British Railways board to advise the Secretary of State on decisions taken in respect of Great British Railways, with representation from various industry groups. I feel that is unnecessary and would distort the clear accountability framework established in the Bill. To be clear, a highly skilled board that can hold to account the executive of Great British Railways will be crucial to delivering an improved railway. The GBR board will be made up of experienced people with diverse backgrounds who can be the voice of railway users. Where the Secretary of State is concerned about the performance of GBR, she will be able to raise these matters with the chair of the board. The chair will be able to advise both the Secretary of State and GBR’s chief executive officer on options for resolution and will be expected to ensure they are acted on, all without the need for a direction.
Jerome Mayhew
I am grateful to the Minister for giving way. I recognise that improvements are needed for the drafting of the board were it to go ahead. He makes reference, however, to the board of GBR and that it will have a number of directors on it. In normal circumstances that would include a number of non-executive directors outside the main organisation. Will the Minister confirm that that is the intention for this board? If it is the case that external non-executive directors are anticipated for that board, could he go down the list in new clause 24(2)(a) to (f) and describe whether those are the kinds of organisations that might be represented in a non-executive capacity on the GBR board?
Keir Mather
It is my understanding that the process of appointing non-executive directors on GBR’s board will be followed in the normal way. I expect departmental processes to find a range of candidates with experience of both the private sector and public institutions, to ensure that GBR is an agile organisation that provides value for money for those who fund the railway and, most importantly, accountability through the Secretary of State, as well as having a mind to furthering the interests of both open access operators and the freight sector within the operation of GBR.
Rebecca Smith (South West Devon) (Con)
It is a pleasure to serve under your chairmanship, Mrs Hobhouse.
I completely appreciate what the Minister is saying. However, I suppose that the outstanding question is this: how will the general public come to understand what GBR is going to mean for them if it is not going to be established for 12 months and if there is not a fixed timetable for reporting back to MPs on how it is going? There has already been a fanfare about delivery; I am sure that there is going to be another fanfare from the Government once the Bill is passed. However, if we are going to take passengers on this journey, so to speak, we must ensure that there is an opportunity for us, as Members of Parliament, to be able to report back, even if it on an issue relating to our own constituency. I think the new clause tabled by my hon. Friend the Member for Broadland and Fakenham is actually quite sensible.
Keir Mather
May I draw the hon. Member’s attention to the fact that so far I have not made a single rail pun in the course of this debate—and I intend to keep it that way?
The hon. Member made a really important point about both parliamentary accountability and the general public being able to understand more about how GBR works and what it constitutes. Throughout the establishment of GBR, there are concurrent process that will allow the Secretary to State to outline more properly the long-term future of the railway and GBR’s role in it, including the long-term rail strategy, as well as work that we are already advancing on the accessibility road map and the rolling stock and infrastructure strategy.
Existing parliamentary structures in our Westminster democracy provide ample room for us to hold Government Ministers and the Secretary of State to account on the establishment of GBR. We have oral questions for Transport, as well as the ability to ask urgent questions on GBR’s establishment. Through both Lord Hendy in the other place and Ministers in this House, we have a real ambition to explain GBR’s provisions and ways of working to the general public, because we are confident in its ability to revolutionise how the railway runs on behalf of passengers, but I take the hon. Lady’s point.
Establishing GBR is the primary purpose of the Bill, and clause 1 provides the Secretary of State with the power, by regulations, to designate a body corporate as GBR. The clause enables wider provisions in the Bill relating to GBR to apply to a body corporate, such as the statutory functions and general duties set out in it. Following Royal Assent, a company will be designated as GBR, and it will consolidate Network Rail Infrastructure Ltd, DfT Operator, train operators and parts of the Rail Delivery Group into one organisation to ensure that GBR can be mobilised as quickly as is practicable.
The clause is essential for the Government to deliver our manifesto commitment to reform the railways by establishing GBR as the directing mind, bringing track and train together. I commend clause 1 to the Committee.
Laurence Turner
I must start by slightly disagreeing with the Minister on his approach to railway puns. The shadow Minister referred to the discussion on amendment 257 as a dispute; I reassure him that this is not a case of pistons at dawn—[Laughter.] It is going to get so much worse. Before I come to the Minister’s substantive response, I will briefly respond to a few other comments that have been made in the debate.
The shadow Minister spoke about changes in passenger numbers over the years, which is a good illustration of why it is important to look across a whole time series, and to bear in mind the old maxim that correlation is not causation. After all, passenger numbers were already falling by the time that we got to vesting day in 1948. The railways were exhausted after years of war—indeed, passenger numbers halved between 1920 and 1947. In fact, the actual nadir in passenger numbers was not in the early 1990s but in 1983. I thought that Opposition Members might have wanted to take pride in the successful sectorisation experiment under the Thatcher Government, perhaps aided by some benign neglect from that Administration, which was sadly not repeated by the subsequent Major Administration.
We have some good explanations for why exactly passenger numbers rose so dramatically in the 1990s and 2000s. For a long time, I think we could have all substituted our political explanations for why that happened. However, in 2018, a very good study, led by eminent modellers and academics, was published by the Independent Transport Commission on precisely that question. It found that passenger growth was overwhelmingly driven by changes in the job market—the types of roles being created and the areas of the country in which they were being created. It was also aided by changes to tax incentives for company cars in the early 2000s, which led to an additional increase in rail traffic.
Laurence Turner
I absolutely agree, and we could point to other examples where franchises being taken in-house under previous Governments led to a service improvement. The Opposition’s problem has always been that public ownership works in practice but not in their theory.
I am heartened by what the Minister had to say on my amendment. This is not an issue of dispute; this is sensible scrutiny. I welcome the commitment the Minister made to take the issue away. I recognise that this Committee is probably not the place to resolve this detailed and technical consideration. I am encouraged by his comments and on the basis that we may return to this matter at a later stage, I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 1 ordered to stand part of the Bill.
Clause 2
Crown status etc
Keir Mather
I beg to move amendment 164, in clause 2, page 2, line 3, at end insert—
“(5A) This section is not to be read as preventing the exercise of functions by Great British Railways on behalf of the Secretary of State, the Scottish Ministers or the Welsh Ministers under arrangements made by the Secretary of State, the Scottish Ministers or the Welsh Ministers.”
This amendment clarifies that the Secretary of State and Scottish and Welsh Ministers may enter into agency agreements for the performance of functions on their behalf. For example, this may be required to assist with winding up of ongoing franchises, as they transition to GBR.
Keir Mather
Amendment 164 will enable the Secretary of State to appoint GBR as an agent to undertake certain activities on her behalf—for example, to manage outstanding contractual arrangements associated with the winding down of the franchising regime while the industry transitions to the new arrangements. It may be appropriate for GBR to do that if transfers of staff from the Department into GBR have already happened, for example. It would also ensure that GBR can effectively co-ordinate the winding down of franchises alongside its new management of services. This is a technical measure that supports a seamless transition of work and resources into GBR.
The amendment also clarifies that Scottish Ministers and Welsh Ministers can delegate their functions to GBR under clause 4, or enter into agency agreements with GBR if desired. That is already the Bill’s intention, but the amendment ensures that the Bill is clear and readable.
Clause 2 sets out GBR’s relationship to the Crown and the civil service, establishing it as an independent body. It will not be part of the Crown or act as the Crown’s agent or servant and its employees will not be civil servants. Additionally, the clause confirms that the Secretary of State, Scottish Ministers and Welsh Ministers will not be considered shadow directors for the purposes of the Companies Acts.
The clause is essential in setting up GBR and laying out how it will operate. I urge the Committee to support the amendment and the clause.
Jerome Mayhew
I enjoyed listening to the Minister read out the explanatory notes; we are all under no illusion as to what clause 2 stands for. The Opposition think it is eminently sensible—in fact, it lifted directly from the structure proposed by the previous Conservative Government for the draft Rail Reform Bill. Government amendment 164 appears to be a clarifying amendment to help with the dotting of i’s and crossing of t’s and we have no objection.
Keir Mather
I thank the hon. Member for his constructive engagement on the amendment and the clause.
Amendment 164 agreed to.
Clause 2, as amended, ordered to stand part of the Bill.
Clause 3
Functions
Jerome Mayhew
I beg to move amendment 2, in clause 3, page 2, line 15, after “sale” insert—
“by promoting a thriving competitive market in the retail ticketing market”.
This amendment makes Great British Railways’ duty to promote a competitive retail market explicit and aligns the Bill with the Government’s stated aim of delivering a system where competition drives better outcomes for passengers.
Keir Mather
I thank all the hon. Members for the amendments, which relate to GBR’s ticket retailing functions. I will turn first to amendments 2 and 117 and new clause 3. The amendments and new clause seek to amend GBR’s retail function and code of practice to promote a level playing field for third-party retailers, with parity of access to fares, products, systems and data.
Once GBR is established, it will have a retail function, as provided for by clause 3. Crucially, that function will be accessible via all channels—at station ticket offices, ticket vending machines, onboard trains and online—ensuring that it serves passengers however they buy their tickets. GBR’s future online retailer—its website and app—will operate in a fair, open and competitive market.
The Government have consistently recognised the significant value of independent retailers, as they help to innovate and drive up standards for passengers. Therefore, I recognise and agree with the motivation behind amendment 2. Nevertheless, the Government do not believe that the amendment is necessary. Significant safeguards have already been announced to ensure that our shared vision for the future of the rail retail market is realised—not least a code of practice, which will be owned and enforced by the Office of Rail and Road.
The provisions in the code of practice will ensure that GBR cannot abuse its position or self-prefer as it also operates vital cross-industry functions that independent retailers rely on. The incentives to comply could not be stronger: if GBR fails to adhere to the code of practice, that constitutes a breach of its licence, and the ORR will take enforcement action. It is as simple as that.
Rebecca Smith
I thank the Minister for the clarity on the code of practice, which has also been echoed in some written answers I recently received from him. While we are talking about open access, what thoughts have the Minister and the Department given to working with independent retailers who have probably spent billions of pounds developing an app and a website that do a particularly good job? What work will they do collaboratively with those organisations, rather than viewing themselves as competition?
Keir Mather
The hon. Lady is right to point out that there are certain areas where GBR will operationally have to work with third-party retailers to ensure that they have the information that they need to continue to discharge their service.
However, another important point is that there are lessons to be learned about existing functions—where they work and where they do not work—in providing value for money for passengers and ease of access to the railway network. That is certainly something that we can take forward as part of the discussion on the Bill. I know that the Rail Minister consistently meets with stakeholders across the breadth of the railway industry, and it should be incumbent on us all to ensure that competitive measures, where they serve the interests of passengers, are incorporated into the way GBR works.
Rebecca Smith
The point I want to come back to is about value for money for the taxpayer. I want some reassurance that GBR will not go right back to the beginning of the journey of creating a ticketing app and website, which would effectively cost the general public an inordinate amount of money, when we already have a lot of platforms that could be brought in-house rather than having to be separate businesses.
On the value for money point, call me a cynic, but my understanding of computer programming is that it is not very cheap. I assume that that is something that GBR will have to factor in. Perhaps using some of the existing independent retailers might be a better value for money option.
Keir Mather
Of course, those independent retailers can continue to operate. GBR also has, as part of its duties—the things that it is required to follow by law—an interest in promoting the efficient use of public funds. We also think that there are significant economic benefits that can be realised through consolidation when it comes to aspects of ticketing.
As has been so ably pointed out, taxpayers and railway passengers are the same people. To that extent, people being taken in different directions by a vast variety of ticketing apps, not being able to realise the potential savings that are in place, does them a disservice economically. We believe that consolidation can offer them a smoother experience of ticketing and, hopefully, access to benefits that otherwise they might not be able to realise.
To return to the code of practice, it will be fully consulted on before its introduction, so it would not be appropriate for the Bill to pre-empt the specific provisions that it will contain. However, I can confirm to the Committee that the principles I have set out today, which I believe are consistent with some of the concerns that amendments 2 and 117 and new clause 3 seek to address, will very much guide ongoing work in this area.
On that point, I turn back to one of the comments made by the Opposition spokesperson about his concern regarding the setting of fares. I would like to make clear to him that it is not for the Secretary of State to interfere in day-to-day fare decisions. The Secretary of State will be limited to setting high-level strategic parameters to ensure that fares remain affordable for passengers and sustainable for taxpayers. GBR will make all of the operational decisions within those parameters and changes to those parameters would occur only to reflect GBR’s financial settlement, or in exceptional circumstances. That is, in my view, a necessary and proportionate safeguard to protect passengers, taxpayers and Government money. Therefore, as we are already taking significant and sufficient steps to deliver what the amendment envisages, so I urge the hon. Member to withdraw it.
I turn now to new clause 9 an amendments 131 and 132, which are dependent on it. New clause 9 would mandate the publication of a report covering various elements of GBR’s fares, ticketing and retail functions. Many of the items that this report would be required to cover relate to affordable and accessible rail travel—causes to which the Government are steadfastly committed. Affordability for passengers will be a key consideration when the Secretary of State sets strategic parameters and guardrails for GBR to follow on fares. As the Committee is by now aware, the Bill ensures continued statutory protection for concessionary discounts for young, older and disabled passengers.
Elsewhere, new clause 9 covers matters such as tap-in, tap-out payment and integrated ticketing, as well as third-party retailers’ access to systems and products. On integrated ticketing, we are already working with local authorities to integrate rail with local transport modes—and to trial or expand pay-as-you-go travel where appropriate. We are also progressing evaluations of how different pay-as-you-go schemes impact passengers, and the final reports will be published in due course. This work, which has not required additional legislation, is consistent with the ambition set out in various parts of new clause 9.
In summary, a legislative requirement to publish the envisaged report is not needed to deliver the outcomes that we want to see going forward. With that reassurance, I hope that the hon. Member for Didcot and Wantage will agree not to press new clause 9 to a vote. Amendments 131 and 132 are dependent on new clause 9 and, for the reasons set out, the Government do not believe the report that new clause 9 would require is necessary, so I hope that the hon. Member will also agree not to press these amendments.
Jerome Mayhew
I have great respect for the Minister and I hear with interest what he said, but I am not convinced that the sector will receive sufficient reassurance from that, so I intend to push the amendment to a vote. Perhaps others, subsequently, as well, but we will deal with those later.
Question put, That the amendment be made.