Rail Franchising

Lord Johnson of Marylebone Excerpts

Wednesday 10th January 2018 Commons Chamber

[The Minister of State, Department for Transport (Joseph Johnson)]

We have had a full and excellent debate on the important subject of rail franchising, and I thank the Members on both sides of the House who welcomed me to my new position. I pay tribute to my predecessor, my right hon. Friend the Member for South Holland and The Deepings (Mr Hayes), who acquitted himself exceptionally well in this role over a considerable period of time.

A lot has been said in today’s cordial debate—it has certainly been a more pleasant debate for me to sit through than the urgent question on Monday—and I will endeavour to respond to as many of the points raised as possible, but let me start by recapping some of what has been achieved, initially by looking at privatisation in the round. The statistics are compelling: last year we published our rail spending commitments for 2019 to 2024, and we will be investing £48 billion in our railways, as well as investment from private sources.

My right hon. Friend the Member for Derbyshire Dales (Sir Patrick McLoughlin) asked for specific comparisons between investment from 1997 to 2010 and from 2010 to 2020. As we have repeatedly made clear, this Government are making the largest investment in our railways since the Victorian era, with £48 billion over the five years from 2019. Let me give the House an example of what that means in practice. We will have ordered 7,122 vehicles for the rolling stock fleet, compared with 5,720 in the period from 1997 to 2010. That should give Members a feel for the tangible and practical impact that the increased investment will have. It will mean improvements in punctuality and reliability for passengers, as well as supporting thousands of jobs in the supply chain and activity in the wider economy.

The privatisation of our railways has succeeded. Passenger journeys have more than doubled since 1995, and we have a claim to being the most improved railway in Europe, and the safest major railway, too. And all this is happening in what is not only one of the oldest railway networks in the world but one of the most intensively used. In fact, more people are travelling on our railways today than in any year since the 1920s, and on a smaller network. It is thanks to this success that we are investing £38 billion in Crossrail and HS2 in the period up to 2019, and £48 billion in the years to come.

[Maria Eagle]

The Minister has just said that the privatisation of our railways has succeeded. Will he tell us whether the Government will vote against the motion this evening?

[Joseph Johnson]

Privatisation is succeeding, and we can see that in the increased numbers of passengers using the network. The motion speaks for itself, and hon. Members are welcome to—

[Neil O’Brien (Harborough) (Con)]

rose—

[Joseph Johnson]

I will give way to my hon. Friend.

[Neil O’Brien]

I welcome the new Minister to his place, and I hope that he will be as successful in this job as he was in his last one—[Interruption.] He was very successful. As he is listing investments, I hope that he will not forget the £1 billion investment that we are making in the midland main line.

[Joseph Johnson]

I certainly do welcome that investment in the midland main line. That is one of the many investments that we are making across the country, and it is part of the £38 billion that we are spending in the control period to 2019. As I said, a further £48 billion is yet to come. This will mean new stations and rejuvenated older ones.

Before Christmas, my right hon. Friend the Secretary of State set out a new approach to delivering rail services. It does not require the colossal reorganisations of the kind that nationalisation would entail. It will deliver the best of both worlds, keeping the benefits of privatisation while maintaining vital infrastructure in public hands and preparing our railway to meet the challenges of the future. Earlier in the debate, the Secretary of State addressed the recent accusations regarding the east coast franchise. It is wrong to describe this as a bail-out. When Virgin Trains East Coast was awarded the contract, it committed £165 million to support the business if it failed to perform as expected. As my right hon. Friend said, we will hold the company to that commitment in full. It has met all its commitments to the taxpayer so far and it is continuing to do so. Make no mistake: we will hold all guarantors, including Stagecoach, to those financial commitments.

We have been making significant progress with industry on the Secretary of State’s vision for the east coast partnership from 2020, and on plans to meet that commitment. We stand by that commitment in full. I was asked about a direct award to Virgin-Stagecoach, and I refer the House to the answer that the Secretary of State gave earlier. My Department is preparing contingency plans, as we do not believe that the Virgin Trains east coast franchise will be financially viable through to 2020. We intend to return to the House in due course, once those plans are in place.

Many hon. Members raised the issue of fares. These are at the heart of the massive investment that is going into the railways, and it is of course right that that investment should be derived not just from taxpayers’ money. Passengers benefit from the improvements that our investment programme is delivering, and it is right that they make a contribution towards it. On average, 97p in every pound that passengers pay—