Railways (Interoperability) (Amendment) (EU Exit) Regulations 2019

Lord Berkeley Excerpts

Thursday 21st March 2019 Lords Chamber

Moved by

[Lord Berkeley]

That this House regrets that the Railways (Inter- operability) (Amendment) (EU Exit) Regulations 2019 (SI 2019/345), laid before the House on 26 February, will cost United Kingdom businesses excessively in operating a potentially diverging range of safety and other railway standards from those of the United Kingdom’s largest market, and regrets the failure of Her Majesty’s Government to demonstrate any significant benefits; and calls on Her Majesty’s Government to lay new regulations that would enable continued compliance with the activities of the European Agency for Rail to provide the best ongoing business opportunities for manufacturers, rail passengers and freight customers in the United Kingdom; continued and consistent safety improvements; and reduced manufacturing costs as a result of one common set of standards across Europe.

Relevant document: 20th Report from the Secondary Legislation Scrutiny Committee (Sub-Committee A).

[Lord Berkeley (Lab)]

My Lords, the previous two SIs that we debated caused a lot of interest—I am grateful to so many noble Lords for their contributions—but they are to some extent the hors d’oeuvre, because this one is the main course. I wanted to table it as a fatal Motion because I feel so strongly about it, but the timing does not really help and I was told it might be several weeks before parliamentary time was found, which would be after the Brexit date that we had—I do not know whether we still do; that is for discussion.

This is a really serious problem: transferring all responsibility for railway safety and standards from the European railway agency to the Secretary of State in the event of a no-deal Brexit. It is very complex, as noble Lords said earlier, but in this case it is also unnecessary: there is a much simpler solution. My impression is that the reason that so many of these pieces of railway legislation, and those on air travel, are presented as a major change is because somebody in government does not like the word “Europe” in the title. We debated this last week when we were discussing the noise regulations in respect of airports, and I suggested to the Minister that there was a serious conflict of interest here, because if the Secretary of State—I am not being personal: any Secretary of State—is responsible for noise regulation at airports but is also pushing for all he or she is worth the third runway at Heathrow, it is in the Secretary of State’s interest that the noise regulations are as lax as possible. The lack of consultation was discussed then, and I fear the same is happening here.

There is a solution, which I shall come to. The European railway agency goes back a long time: I have been involved in it for probably more than 10 years. It means that there is one set of standards for the manufacture, export, testing and everything in the railway sector across Europe. There is the common requirement for safety, accident and other data, which the House also discussed this morning. It is extraordinary that the Government are introducing this massive change for what I call dogmatic reasons.

I give noble Lords an example of what happened about 10 years ago, which was one reason why the ERA was created. A rail freight wagon was developed in this country to take trucks piggybacked on it—mostly cement trucks. It worked very well. It was developed by a company called WH Davis, and it was so successful that it had an export order to operate in France. When it tried to get approval from the French regulatory authority to operate in France, the changes necessary—which were not that big but were significant—would not allow it to operate in this country. So there could not be a wagon that complied with both countries’ standards at the same time. That is a small example of why it was so important to make a European agency responsible for such things, which would also allow manufacturers in one country to apply to the ERA for approval if they thought that approval in one particular member state was being withheld for reasons that might be political.

There is, I am afraid, another more recent example of the Secretary of State’s involvement, involving station platform heights; I am sure that noble Lords are great experts on that subject. One of the reasons why the Government apparently do not like anything to do with the ERA is that it told them they could not have a certain station platform height for HS2, because it was different from the platform heights on similar high-speed lines on the continent. I am told that that caused a certain amount of anger: how dare Europe interfere? This is interesting, because the station platform height regulation applies to only four stations on HS2. All the other stations that HS2 trains will go into have Network Rail platforms, whose heights are all different anyway.

If the Government think that they are very good at such things, let us consider Crossrail station platforms. The Crossrail stations in the central section allow level boarding between the platform and the train—but unfortunately that height is different from all the other stations that Crossrail trains will go into at each end of the route, at Reading, Shenfield and wherever else. That means that someone in a wheelchair will need help at every station outside the centre: they will need not only a portable ramp, but a staff member to help them on and off the train. When I asked why we could not have one common station platform height for the centre sections and the outside sections, I was told that the European railway agency thought about the plan and questioned it, but because this is a metro service it does not have the wherewithal to challenge the Government. This is what the Government have achieved, which is unclear and will cost everybody a lot of money for a very long time.

It may be surprising, but the whole railway industry is I think in favour of the status quo with the European railway agency. Whether it be Network Rail, the Rail Delivery Group, the Railway Industry Association, the Rail Freight Group—I have already declared an interest as a former chairman of that—or the Chartered Institute of Logistics and Transport, they all want the status quo to continue. I have talked to them all, and if they have not gone public on this too much it is because many of them have had to sign ridiculous non-disclosure agreements. Let us hope that that will stop as soon as the Brexit debate finishes.

There are strong arguments for staying with the European railway agency. My preference would be to suggest an associate membership, such as the Swiss Government have. I have talked to people in Switzerland, both in railways and in government, and they say that it works fine. They are not on the boards, but they still get things done by talking to people. They mentioned the European Court of Justice. The Swiss do not like it, any more than our Government do. But when I asked whether that was a problem, they said, “No, we just carry on talking about it—but it works”. So I suggest that the solution is something like associate membership of the European railway agency. We should abandon this ridiculously complicated SI—which may get abandoned anyway if we do not bale out.

I hope that in her response the Minister can give me two assurances. One is that, assuming that this SI does not come into force, the Government will consider alternatives to the present idea when they look at it again—which they probably will unless we stay in the EU. The second is that they will discuss with the Swiss Government, the European Union and the European railway agency whether there is an arrangement that could enable the continuation of compliance and information sharing. I repeat: that is what the industry wants. It will save money and provide more export opportunities. It seems to me that there is no downside, apart from the fact that the European railway agency has “Europe” in its name. I beg to move.

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[Lord Liddle]

I quite accept the point made by my noble friend but it is better than nothing and it provides hundreds of jobs in Durham. While my noble friend says it is just an assembly plant, how could such a plant operate in Britain if we decided to have different technical standards from those on the continent? That would completely destroy the business model on which that inward investment had been made.

[Lord Berkeley]

I am grateful to my noble friend for his words. Is he aware that Hitachi recently bought a firm in Italy that manufactures trains and signalling equipment? Can he imagine what would happen if it had to manufacture in all these places using different standards for the European markets and the UK?

[Lord Liddle]

As always, my noble friend Lord Berkeley makes an excellent point. I think that the Government have to come up with a better explanation for why we should be leaving these arrangements than the simple, “Why should we bother to be part of some European agency when we have left the European Union?”

--- Later in debate ---

This SI is needed if we leave without a deal. The future relationship with the European agency will be subject to future discussions.

[Lord Berkeley]

Will the Minister say something about what would happen in the event of the Prime Minister’s deal—in other words, not the cliff edge—and whether this SI would no longer apply? Would the Government bring back a similar SI or would they carry on as we are at the moment? What options are open?

[Baroness Sugg]

If the exit day is changed as agreed, the exit day in this SI would change as agreed. I do not want to predict what is going to happen over the next couple of days or the length of an extension, if there is one. Our position is still that we do not want to seek membership of the European Union Agency for Railways.

I understand noble Lords’ concerns in this area. I will take them back to the department and inform the Secretary of State of the strength of feeling on this. I hope I have provided reassurances on the consultation, the impact assessment and parliamentary scrutiny of any future divergence, which is the main and understandable concern of industry, whether manufacturers, importers, exporters or whatever.

The noble Lord, Lord Tunnicliffe, made a key point about volume. This is not an attempt to diverge from standards; it is simply that if we are no longer a member state, we will not have a vote in the European Union Agency for Railways, so these regulations remove the obligation to take its rules. If we decide to diverge, we will have full consultation and a full impact assessment and we will ensure that we inform Parliament. While this is a no-deal exit SI, the future relationship is always subject to conversation with the Commission and member states, should we get to an implementation period. We will have close conversations with them on this agency and other European agencies in the future partnership agreement.

I am not able to go any further on our future position with the European Union Agency for Railways at this stage, but the noble Lord’s position on it is clear and I will ensure I take it back and discuss it with the department. Given the assurances that there are no set plans to diverge, that we will consult, publish an impact assessment and inform Parliament, I hope that the noble Lord feels able to withdraw his Motion.

[Lord Berkeley]

I am grateful to the Minister. She has tried very hard to justify something which is probably impossible to justify. She talked about divergence, as did many noble Lords. Unfortunately, when people say there is going to be no divergence, it happens for political reasons. That is not just under this Government; it has been around since time immemorial. It helps to have an agency which is completely separate from the political process. As the noble Baroness, Lady Randerson, said, if it can work for air and sea, why can it not work for rail?

It may not matter, but I can see cost, bureaucracy and a loss of business coming from this SI. I very much hope that we do not leave the European Union in the manner that requires this SI to be implemented, but I have not heard what would happen in the event of our agreeing with the European Union another way out or even staying in—that is a different matter because we would stay in the ERA. I also have not heard a good argument for us not staying with the European Union Agency for Railways under associate membership. If Switzerland can do so, why not us? Switzerland has very good railways. We all have a process for derogations. We have been having derogations from the ERA for a long time. I am told that it has stopped giving us derogations, probably because it is so fed up with us at the moment, but that will not go on for ever.

I thank all noble Lords who have spoken in this debate. There seems to be solid support for stating in the European Union Agency for Railways, with the exception of the Minister and my noble friend on the Front Bench—he and I do not always agree on everything, and that is fine. I wish to test the opinion of the House.