Bus Services Bill [HL]

Lord Horam Excerpts

Monday 4th July 2016 Lords Chamber

[Lord Horam (Con)]

My Lords, I agree that there is no distinction, really, in accountability terms between a mayor and a councillor who is considering these matters. I strongly agreed with the remarks of the noble Baroness, Lady Jones, about London and London franchising. I live in London and I can certainly attest that what she said about that is entirely correct. London buses are, frankly, marvellous. Whether you congratulate Boris—poor chap, he is receiving rather a bad press at the moment so I might as well praise him for his new buses—or Thomas Heatherwick, who actually designed them, they are absolutely superb. Whether you praise Thomas Heatherwick, Boris Johnson or Ken Livingstone, London really works from a bus point of view. In fact, my wife said to me the other day, “You’re becoming a bus junkie”. I actually took a bus to go one stage because the bus routes give you priority over cars, et cetera, so it really does work. Therefore, I am emphatically in favour of the Bill, which tries to extend franchising to the rest of the country, which I think badly needs it.

However, I am, frankly, horrified by Clause 4, which submits everything—apart from the one aspect of mayors with combined authorities—to the requirement that the Secretary of State should process it. It means that a council which wants to put on a new bus service from, let us say, Little Dribbling to Nether Wallop has to take it to the Secretary of State. That is absolute nonsense. I was a Minister of Transport in a Labour Government a long time ago and this system does not work. You need to get somebody who knows the situation locally, understands it well and can take a decision. Okay, there are always a few problems and occasionally things go wrong, but pushing it up to a civil servant and then to a Minister, who probably has no knowledge of the situation you are talking about, does not work. All it does is congest the Government at the top level.

I saw the other day that Prime Minister David Cameron was complaining that in comparison with Angela Merkel, he had much more to do because he had to take decisions about education, transport, the NHS and so forth and she did not; in Germany it was all farmed out to the Länder. This is why. We are taking all these absurdly detailed decisions at government level. Although my experience is quite different from that of the noble Lord, Lord True—his is extensively in local government, mine is not—from the point of view of a government Minister, it is nonsense, frankly. It simply does not work.

The noble Earl, Lord Attlee, tried his best to give a reason, which was about accountability. There is no difference between the accountability of an elected mayor and that of an elected councillor. It is a simple fact. They are both elected; they are both responsible to the local electorate. There is no distinction that I can see. I am not surprised that the Delegated Powers Committee said that there was no adequate explanation. I looked through the Explanatory Notes, hoping to find some rationale for this procedure, and there is none. Therefore, we have a real problem here and the Government really have to think again.

Another difficulty is that quite apart from overcentralisation, the British Civil Service seems to go in for too much complexity. If we raise the bar too high, either because things have to be processed up or because we put in a lot of regulations, which are sometimes unnecessary—they are no doubt sensible in some ways and no doubt advisable; none the less there is more and more regulation—it becomes likely that lots of local authorities which could use these powers will simply say, “Oh, it’s too much trouble. We don’t want to bother with all that. We won’t do it”. There are easy ways to get out of it and then blame the Government. When people ask, “Why isn’t there a decent bus service here?” they can say, “Because the Government made it so complicated”. It is an easy way out for them.

Therefore, while, like my noble friend Lord True, I am in no way criticising my noble friend on the Front Bench, who has his job to do and who does it extremely well, I believe that between now and Report in September the Government should look at this and extensively modernise it. If they do not, I do not think, frankly, that they have much chance of getting it through this House.

[Earl Attlee]

My noble friend Lord Horam observed that the Explanatory Notes do not justify the policy, but my understanding is that that is not the purpose of Explanatory Notes. Explanatory Notes, as I understand it, tell us what the Bill does and how it works and do not seek to justify the policy.

[Lord Horam]

It is not just that the Explanatory Notes, which should explain what each clause does, do not explain why this does what it does; the overview, which we also get, does not explain it either.

[Lord Snape (Lab)]

My Lords, I am not getting involved in the squabble between noble Lords opposite, because I want to start one of my own, on this side. The fact is that I have never been in favour of franchising and I do not think that the proposals for franchising in the Bill are particularly sensible either.

I listened with interest to the view of the noble Lord, Lord True. I know that he is enormously talented, but I am not sure that he is qualified to run a bus company—although, obviously, as the leader of a council, he feels that he should. I share his view that elected mayors are not capable of running bus companies either, but we all know why they are being given that responsibility. Having created these large authorities against the wishes of the electors in cities such as Birmingham and Manchester, they have to give them something to do—and I am sure that letting them run the buses seemed to the Treasury to have been a good idea at the time.

I have asked Ministers about this and, indeed, the Minister here today indicated that the extra money needed to run those bus services in our large cities will be provided by the Treasury. That is not normally the way that the Treasury goes about things and it seems to me that these responsibilities are being passed on to big-city level without the resources to deliver them adequately.

Again, I have to say to my noble friend on the Front Bench that I do not share her view of the bus industry as it used to be. It is a bit like British Rail: everybody tells me how wonderful it was. Actually, I used to work for it and I did not think that it was particularly wonderful at the time. Now it is implied that the bus industry, when it was under municipal control, was a picture of tranquil harmony, with lots of satisfied passengers. I have bored your Lordships before with my own career, such as it was, in the bus industry, but, when I worked for Travel West Midlands, it was a group of municipal undertakings that were put together as a result of the 1968 Act, semi-privatised by the Conservative Government of the 1980s and actually acquired by its employees.

When I became a director of the company I did not think for a moment that it was due to my talent: I was told afterwards that I was the one person who both management and staff could agree on at the time. I am not sure whether that was praise or condemnation, but I became a director of the company in 1992. Many of its buses were quite ancient. The average age of the bus fleet of Travel West Midlands in 1992 was nine and a half years. After we, the employees, voted in 1997 to join the National Express Group, the age of the bus fleet when I stepped down as chairman in 2000 was just over six years. That was a quite dramatic reduction and indicates the amount of investment that was put into new vehicles during that period.

If bus services are franchised, what will happen to that investment? I have to say to my noble friend that, because we were a subsidiary of the National Express Group, it was my job and the job of the other directors to make a case for investment to the main board. We actually invested around £30 million during the time I was directly involved, in tranches of around £10 million each time. We had to convince the board of the National Express Group that it was sensible to invest that sort of money in bus services in Birmingham.

Does my noble friend think for a moment we would have got the go-ahead from the National Express Group if the idea of franchising was being held over the company’s head at that time? I will answer my own question: the fact is that we would not have got the go-ahead, because the view of the National Express board would have been, “We are not prepared to spend £10 million of our assets on buses when someone else—whether it is the noble Lord, Lord True, or someone else—will tell us where to run them, when to run them and how much to charge”.

Again, reverting to those so-called halcyon days of municipal control, my noble friend talked about the amount of profit that was made by the five major bus operators. As I have indicated, many of them operate new fleets. As far as wages are concerned, I will confine my remarks to Travel West Midlands, where I was chairman of the board. We paid our drivers the best rates in the United Kingdom, so those profits were not made off the sweat of the brow of our employees, although of course some went to shareholders. I know that we have some disagreements at the moment about the leadership of my party, to say the least, but I do not think that we are entirely anti-profit-making yet. We will have to see what happens in the next few days and weeks, but I do not think we object to companies paying their shareholders a dividend and paying their staff an adequate wage.