Transport and the Economy

Lord Harrington of Watford Excerpts

Tuesday 28th February 2012 Commons Chamber

[Stephen Hammond]

I certainly agree with the latter point. It is beyond the scope of my comments this afternoon to go into the differing amounts of regional money. I accept that there clearly is some imbalance in subsidy between varying regions of the country. It is important to analyse what that can deliver and its efficacy. It is interesting to speculate what Crossrail might bring to London in future, as opposed to what the northern hub might bring to the north. I suspect that the benefits of the northern hub might be greater than those of Crossrail. We will wait and see. I am sure the Minister and the DFT will continue to reflect on that.

As a practitioner of the dark art of economics, I know that different economists will always have differing views on everything. Reading the report, I was struck by the comments of the former chief economist at the DFT. Although those may have been made only in response to the question that he was asked, it seemed to me to miss out quite a lot when he said that if one looks at the history of the British economy, it is clear

“how little the underlying rate of economic growth has varied.”

He went on to add that transport had done very little to affect the overall growth rate of the British economy. That seemed to miss out the fact that we have had wildly varying periods across history.

The witness's analysis went back almost 200 years. Over that time, we have had wildly differing levels of infrastructure investment, and there have been periods when the growth rate of the UK economy has been well in excess of the 2% that he mentioned. His analysis also failed to consider the impact of under-investment, which is a well known phenomenon, how that would have dragged down the underlying potential growth rate of the economy even in a period when investment had resumed, and the potential growth rate had there been consistent investment. Although the analysis that Mr Riley presented to the Committee may or may not be valid, it seems to me that it falls foul of the law of averages. I think that the analysis should look at the potential for economic growth with a consistent approach to investment.

[Richard Harrington (Watford) (Con)]

Having listened carefully to my hon. Friend’s argument and seen some of the evidence that was given to the Committee, it seems to me that, although it could be argued that investment in transport might not be such a direct factor in economic growth, we must also consider what would happen if we did not make that investment and this country fell further behind, which I think would lead to economic shrinkage.

[Stephen Hammond]

I thank my hon. Friend, who more than eloquently makes the absolutely correct point—the final point in my analysis of the economic situation—about the economic analysis presented by Mr Riley.

One of the other learned gentlemen who gave evidence, Professor Goodwin, spoke of the potential for investment not to be transformational, but to be strategic—I am not sure whether he was playing with semantics. He did not like the word “transformational” but said that there was an element of strategy—I think “strategic” is the word he used. He is right that there has been a continued over-egging of the ability of certain single projects to produce the sort of result that some people hope for.

However, if we look at the sheer size of certain schemes and the investment that this and previous Governments have made that complements and adds to what is already in place, and/or if we look at the smarter changes and smarter choices in transport packages, we will see that there is a real chance for transport and infrastructure investment to be transformational. I suspect that some of the moves on work travel packages, which aim to increase access to work, and some of the major electrification projects, which are combined with other minor schemes in parts of the south-west, will in five or six years’ time be considered transformational. In that regard, the evidence given to the Committee probably fails to recognise transport’s ability to be transformational and, more importantly, to enable economic growth.

Moreover, the point that neither of those two learned gentlemen discussed—this is where I disagree with the analysis of the hon. Member for Liverpool, Riverside—is that if transport is part of a cluster of other investments, including increases in education, access to work, economic development zones and others, its ability to contribute to the potential for economic growth is far in excess of what that would have been had the investment been made on its own. A number of people will have made a better analysis of the cluster theory than I have, but that is broadly what it says. Yet again, if transport is combined with other Government policies, its ability to have a significant impact should not be underestimated.

I will finish with a few other remarks. I warmly welcome and support the conclusion that using transport to support and stimulate the economy and to attempt to reduce regional economic disparities is surely right. The test of the Government in that regard must be whether they are showing any understanding of those challenges. In a time when the key overriding economic priority must be to reduce the economic deficit and ensure that the public finances are put on a more stable profile, this Government are undertaking a number of measures which recognise those challenges and provide economic support in relation to it. We have seen that, significantly, through the Minister’s sponsorship of several local transport plans and investment programmes, and they are having on a small scale quite a huge impact on bus routes, local transport—in terms of local rail—and other issues.

Equally, the support for major projects throughout the regions, such as the northern hub, which has been mentioned, the electrification of the south-west main line and the investment in the east coast main line over the past 10 years, strikes me as sending a clear message that this Government recognise the need to maintain transport infrastructure spend.

As the Chairman of the Transport Committee pointed out, the Department for Transport has done relatively well from the overall comprehensive spending review debate, and that represents the Government’s understanding of the need for and importance of transport infrastructure.

I have spoken principally about rail in my last few remarks, but it is clear also that we neglect at our peril the need to maintain and upgrade our roads, and some smaller road schemes will have a bigger impact than some major, strategic ones, so the £3 billion that the Government are putting into local road schemes over four years is likely to have a positive impact on local, regional and overall economic growth.

I welcome the report, which has sponsored a debate about transport and the economy. I welcome also the Government having evidenced by their actions their understanding of the need for infrastructure in order to support economic growth and the quality of life of our citizens. I am sure that the Minister, in his winding-up remarks, will say that this is not just the start but a continuing policy of the Government.

--- Later in debate ---

[Karen Bradley (Staffordshire Moorlands) (Con)]

I apologise for missing the beginning of the debate. I am serving on a Public Bill Committee at the moment and will have to return to it at some point.

I listened carefully to the hon. Member for Sedgefield (Phil Wilson). I, too, will talk about rural bus services, because my constituency of Staffordshire Moorlands, as one can guess from its name, is incredibly rural. It is also, perhaps uniquely in central England, a constituency that contains neither a dual carriageway nor a mainline train station, which gives us unique transport problems. We are within one and a half hours of three international airports, but I have yet to find a way to get from one of the main motorways that surround my constituency—the M1, the M6, the M56 and various others—to my home in Leek, in the centre of the constituency, in less than 40 minutes. That shows that Staffordshire Moorlands is isolated from much of the rest of the country.

That poses a challenge, because we want people to come to Staffordshire Moorlands. A third of my seat by geography is in the Peak District national park, which is incredibly beautiful. We have the Manifold valley, the Roaches and other places that we desperately want people to come to and—I mention this as we are debating transport and the economy—spend their money. Given our transport infrastructure, getting them there is obviously not easy.

We have not only the beautiful Peak District national park but Alton Towers, one of the biggest tourist attractions in the country. Again, we want people to come to that great national institution, of which we are very proud. Unfortunately, anybody who has visited Alton Towers will know that to get to it, one has to travel through some beautiful villages where there can be significant traffic congestion. The challenge is to get people to come to Staffordshire Moorlands and spend their money, but also to ensure that the people who live there because of its great beauty can do business and trade with the rest of the country and globally. I recently visited a design company based in the Peak park that does business across the world and needs to be able to get to the motorways and trains, but in a way that does not damage the beautiful environment in which we live.

I say to the Minister that I am not here today to call for great investment in new roads. Perhaps some potholes being filled in would be appreciated, but we are not looking for great infrastructure developments across Staffordshire Moorlands, merely better ways for people to travel.

It is also worth pointing out that some of the most statistically dangerous roads in the country are in and around Staffordshire Moorlands. It is an area very much favoured by motorcyclists, particularly on beautiful sunny afternoons such as we have had over the past few weekends. Rarely does a week go by without an accident being reported in the local newspaper, very often a fatal accident. I know from my local fire service and police that the road traffic accident rate is probably the main reason for the high levels of the activity statistics that they report.

My final point in setting the scene is that Staffordshire Moorlands is a border area. It is the most northerly seat in the west midlands, bordered by Cheshire in the north-west and Derbyshire in the east midlands. That causes specific concerns. For example, on some of our most dangerous roads there are different speed limits at different points, because they cross the borders between local authorities that have made different decisions about the appropriate limit. That causes the problem that drivers do not know what the speed limit is, because they might not be totally convinced about whether they are in Staffordshire yet. The same problem applies to bus services, which I will come to later.

Another important business in my constituency is the great number of hauliers. Being in the Peak District national park and neighbouring the Potteries, we have great natural resources such as limestone and clay, so a haulage industry has grown up. Again, that poses specific problems.

What transport problems have constituents raised with me? I have already spoken about speed limits, and the signposting of them is incredibly important. There is the problem of crossing borders, but also, in some villages there is a change from a 30 mph zone to a 60 mph zone. Because of those villages being in an area of outstanding natural beauty, signage is not quite as obvious as it should be. A constituent wrote to me only this week saying that they live just on the point where the 30 mph zone starts in the village of Alton, which, as the name suggests, is next to Alton Towers. Many drivers use that road to go to Alton Towers and are unaware that they have just entered a 30 mph zone. We need increased signposting and more traffic calming measures. We have seen great success with the solar powered signs that flash up a warning that a driver is speeding and should be doing only 50 mph, 40 mph, 30 mph or whatever is the appropriate speed. Those traffic-calming measures have been more successful than others.

I congratulate Staffordshire county council, which has been instrumental in introducing 20 mph speed limits outside schools. Some rural schools in my constituency are on very busy rural roads, and a 20 mph speed limit is welcomed by parents. I encourage the council to introduce more such limits in the rest of the constituency.

I would be remiss in a speech about transport in Staffordshire Moorlands not to mention the ongoing local issue of road changes in Leek. That is a matter for the local authority and I am not calling on the Minister to make any specific comment on the detail, but I want to state for the record that anything that can be done to improve the ability of pedestrians to cross the road safely will be greatly appreciated. As things stand, the shops in Leek will not be accessible by pedestrians because there will be no pedestrian crossing between the car parks and the shopping area. That might sound slightly unusual, but it has been proposed and I should like to put on record my concern about it.

The hon. Member for Sedgefield mentioned rural bus services. The Minister has met one of my local bus companies—a very successful family business—and has heard its concerns. Subsidies across different local authorities are a particular concern to local bus companies in the moorlands, and some bus companies run routes across four local authority areas. Establishing what subsidy each local authority provides and what regulation and Criminal Records Bureau checks each imposes makes it difficult for private bus operators to operate in areas such as the moorlands.

Another matter for local bus operators is school transport. As in any largely rural constituency, many schoolchildren in mine travel significant distances between their home and school. School transport provision is raised regularly with me by constituents, and particularly those whose children have to walk long distances down isolated and badly lit lanes to access a bus service to take them to their school, which in many cases is many miles from home.

Road hauliers were probably the only group in the run-up to the election and afterwards to lobby for an increase in VAT, desperate as they were for a levelling of the playing field between them and overseas haulage companies. They were grateful for the increase in VAT, but it will come as no surprise to the Minister to learn that they are pushing for a cut in fuel duty. They are also concerned about EU regulations and raise the matter regularly. Many feel that EU regulations are imposed on them that are perhaps not observed or enforced in other countries. They are keen to ensure that EU regulations are not gold-plated for UK hauliers. They want appropriate regulations because they understand, as all hon. Members do, that regulation and health and safety rules are necessary, but there should be a level playing field for our hauliers and those from overseas with which they compete.

While I am talking about haulage and large lorries, I must mention quiet lanes and sat-nav. It will probably come as no surprise to hon. Members to learn that numerous signs are popping up around Staffordshire Moorlands to advise drivers that the route they are recommended to take by their sat-nav is not suitable for heavy vehicles, or often even for normal domestic cars. That is becoming more important in rural areas such as Staffordshire Moorlands, and I am sure hon. Members on both sides of the House have the same experience. Any pressure that the Ministry could put on satellite navigation companies to help them to identify inappropriate quiet lanes would be very much appreciated.

One problem caused by the lack of public transport gets raised with me a lot. People are reliant on their cars, and whenever I do a high school hustings, without fail people mention car insurance for young drivers. The cost is hurting young drivers and preventing them from helping with economic growth by taking apprenticeships and attending training. They need to drive their cars to get to work, but car insurance premiums are a barrier to that.

Although my constituency has no main line train station, as I mentioned earlier, we have an excellent heritage railway, the Churnet Valley railway, which runs wonderful steam trains every weekend. If anyone wishes to visit Staffordshire Moorlands and ride on the Churnet Valley railway, they will be welcome. It is being extended as far as the Cauldon quarry, a large cement works in the moorlands. On Sunday, I was delighted to see the number of cars around the railway lines carrying people to see the steam engines travelling through and to enjoy the spectacle of a steam train travelling through the Peak district.

[Richard Harrington]

I am conscious that, as has been pointed out to me on several occasions, my hon. Friend’s knowledge of Watford is limited to whizzing through on the train, but notwithstanding what she said about rural areas, I hope she understands that extensions to train services such as the Croxley rail link, for which the Government have just given funding—I am grateful to the Minister for his time and effort on that project—are also important to constituents such as mine, and do not take away from train facilities in rural areas.

[Karen Bradley]

I agree with my hon. Friend. In fact, my knowledge of Watford extends to having attended a few training courses in Watford over the years, not just to whizzing through on the train. I wholeheartedly concur that any extensions to train services in the Watford area will be greatly appreciated.

The extension of the heritage railway in my constituency is being funded by a private rail company that has been a recipient of money from the regional growth fund—it is very grateful to the Government for that financial support. The company is looking to reopen the line to Stoke-on-Trent from the quarry, which would result in an enormous number of aggregate lorries leaving the roads and travelling by train, which would be of great benefit to people living in the Moorlands. The quarry owners, too, are keen to get as much on the railway as possible.