Shadow Great British Railways: Chair Appointment

Lord Hendy of Richmond Hill Excerpts

Tuesday 12th November 2024 Lords Chamber

[Lord Moylan]

To ask His Majesty’s Government whether the appointment of a chair of Shadow Great British Railways was subject to a competitive process.

[The Minister of State, Department for Transport (Lord Hendy of Richmond Hill) (Lab)]

My Lords, passengers and the taxpayer cannot afford to wait until we have established Great British Railways. Therefore, we have taken the immediate steps of establishing shadow Great British Railways and appointing Laura Shoaf, by a direct ministerial appointment in accordance with Cabinet Office guidance, as its chair. She brings immense hands-on experience of delivering change and a shared desire to move fast to fix things. The future chair of Great British Railways will be appointed through open competition in due course.

[Lord Moylan (Con)]

My Lords, this Question is not about any individual. Will the Minister say how many businesses of the scale of Great British Railways would appoint a chairman without any sort of competition or any opportunity for other people to put themselves forward? Is this a reasonable thing to do?

[Lord Hendy of Richmond Hill (Lab)]

Yes, it is a reasonable thing to do. This is not the chair of Great British Railways, which will be established after the substantive railway Bill in due course; this is an arrangement to bring some benefits to the railway to counter the now 31 years of fragmentation and balkanisation, and, in particular, to bring together the three parts of the already publicly owned railway: the rail services division of the Department for Transport, Network Rail and directly operated holdings. It is a very reasonable thing to do and it will deliver results.

[Baroness Randerson (LD)]

My Lords, Laura Shoaf has been chief executive of West Midlands Combined Authority, and we on these Benches are pleased that she brings deep experience of devolution, which we hold dear as one of the solutions for the future of our railways. Passengers are impatient to see signs of improvement, so can the Minister assure us that the promise to establish a passenger standards authority will be kept? Will the Government also consider establishing that in shadow form, so that it can get on with the job of improving standards for passengers as soon as possible?

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[Lord Hendy of Richmond Hill (Lab)]

I thank the noble Baroness for her endorsement of the qualifications of Laura Shoaf, who is indeed well acquainted with both the operation and development of urban transport systems and devolution. The passenger standards authority will be put together in the substantive railway Bill. In the meantime, there is Transport Focus, and we have had recent discussions in Committee about what can be done in the lead-up to the substantive Bill.

[Lord Bellingham (Con)]

My Lords, can the Minister find time to turn his attention to the HS2 timetable? In particular, can he tell the House now, in the light of the Budget announcements, when the major capital work at Euston station will be completed?

[Lord Hendy of Richmond Hill (Lab)]

The Chancellor announced in the Autumn Budget that the tunnels from Old Oak Common to Euston will be built. It is, of course, necessary to have built the tunnels in order to develop the station. The Government are now turning their attention to how the station should be developed in a cost-effective manner and how it will be funded, and there will be more on that in due course.

[Lord Foulkes of Cumnock (Lab Co-op)]

My Lords, may I, as a regular rail user, say how grateful we are to the Government for sorting out the chaos of the last 30-plus years? The track, the rail infrastructure, the engines and the operators are all in separate companies, and it has been total chaos. Is it not about time that the man principally responsible, the noble Lord, Lord Young, gets up and apologises for the mess that he has provided us with over the last 30-plus years?

[Lord Hendy of Richmond Hill (Lab)]

I should concentrate on my noble friend’s right description of the chaos of the last 30 years. The railway is not functioning properly; far too much of the time of everybody concerned with managing the railway is spent on blame attribution and contractual negotiation, and far too little is spent on delivering a decent service for passengers and freight and making the railway do what it should do for the economy. That is what the Government’s policy is designed to change.

[Lord Young of Cookham (Con)]

My Lords, following the privatisation of the railways, in which I played a modest part, decades of decline in passenger traffic was reversed. Once the dead hand of the Treasury was removed from investment, there was fresh investment in new rolling stock and modernising the stations, passenger fares were pegged at RPI minus one—a policy reversed by the Government adorned by the noble Lord, Lord Foulkes—passenger safety improved, and we developed a market in train operating companies to replace the monopoly of British Rail. What was not to like about that?

[Lord Hendy of Richmond Hill (Lab)]

Since Covid, the railway has got only four-fifths of its previous income. The train operating companies are now, in effect, flat contractors to government and their owners are unable to take much, if any, financial risk. The service to passengers is not as good as it should be, and the Government’s policy is designed to make that significant change.

[Lord Watts (Lab)]

My Lords, under the last Government, it was cheaper to fly to New York than it was to travel from Manchester to Euston by train. Will the Minister do something about the overpricing of trains to make them more competitive?

[Lord Hendy of Richmond Hill (Lab)]

Fares on the railway are so complicated that even the people who sell them do not understand them. Some of them look absurdly expensive; some are very cheap. It is very possible to sit in a carriage where nearly everybody has paid a different fare for the same journey. The passengers wholeheartedly dislike it. One of the reasons for public ownership of the railways is to get commercial sense back into a sensible fares and ticketing system, which will attract passengers to the network.

[Lord McLoughlin (Con)]

But, my Lords, does the Minister accept that, on some occasions, it is necessary for the Government to appoint people without a competitive process—as I did in the Minister’s case when I appointed him as the chairman of Network Rail? I expected him to be solely the success that he was and to bring a political neutrality, which we see today and which he carries well in his present role.

[Lord Hendy of Richmond Hill (Lab)]

Of course, I congratulate the noble Lord on his previous appointment, which seemed to last nine years, so you might judge it successful. I think that the present appointment will be equally successful—somebody with an excellent transport background who understands the politics and economics of large conurbations and will make a real difference, improving the railway in the short term before we get the substantive Bill in the longer term.

[Baroness Butler-Sloss (CB)]

My Lords, I have a vivid recollection of how inefficient British Rail was because, when I was at the Bar, I appeared against British Rail people on a regular basis. Can the Minister and his department check what British Rail got up to, and do something completely different?

[Lord Hendy of Richmond Hill (Lab)]

The British Railways Board was abolished in 1993. The way in which the railway needs to work in future has to reflect the significant devolution in the country since then. It is our intention that the railway is run by people who are in control of a significant part of it—what I would describe as the Network Rail route, and a train company —including the track, the trains and the staff, and that they deliver a decent service. That is the intention in future.

[Baroness McIntosh of Pickering (Con)]

My Lords, may I appeal to the softer, gentler, more apolitical side of the Minister? Does he accept that it would be churlish not to congratulate the previous Government on paying £9 billion during Covid to keep all the trains running? Not one railway worker lost their job.

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[Lord Hendy of Richmond Hill (Lab)]

I think everybody on the railway was extremely grateful for the support the Government showed for the railway service at that time. Nevertheless, the consequences of Covid have been that the cost of the railway is almost the same but its revenue is four-fifths of what it was. One of the objectives now is to deliver better value and a better service, and the method of management I have described will achieve that.