Lord Moylan
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Railways Bill
Lord Moylan ExcerptsTuesday 8th September 2026
(1 month, 2 weeks ago)
Grand CommitteeRead Full debate Railways Bill 2024-26 View all Railways Bill 2024-26 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: HL Bill 25-II Second marshalled list for Grand Committee - (8 Sep 2026)
Lord Moylan
“(1A) The body corporate must be a company constituted under the Companies Acts.”Member’s explanatory statement
This amendment seeks to clarify an ambiguity in this and the following Clause as to the legal character of the body corporate.
Lord Moylan (Con)
My Lords, in the course of preparing for this Committee, I have had a number of meetings with the Minister and his officials, and I thank them for making themselves available for those meetings. I say that now because I shall almost certainly forget to say it at more appropriate times later on, but if I do it is not because I do not mean quite seriously how grateful I am for the contribution and effort that they have made.
We are here on the first day of the Committee to create a Soviet-style railway in the United Kingdom and to go back—and we now know explicitly that it is the Government’s and the Prime Minister’s intention—to the warm and fuzzy 1970s. The 1970s are now the paradigm of where our nation should be. Those of us who remember the 1970s—there may be a number of us in the Room—do not have such fond memories of the standard of public services then compared with what we have today. We do not today have bodies unburied, we do not have refuse piled high in the streets as a result of government folly and we have railways that run broadly on time compared to the—I see that the noble Lord, Lord Bradshaw, is not here to be annoyed by this—relative catastrophe of British Rail in its worst days as it trundled towards its final station. Now it is to be resuscitated. We are to get Great British Railways in place of British Rail and we are going to have it on a totally nationalised basis.
There are two separate things going on here. First, the Minister makes a case that the railways would operate more efficiently if, as he puts it, track and train were united. That argument can be debated. I do not wholly accept it, but it can be debated, but it is not necessary in order for track and train to be united that they should all be owned by the Government in a single company. We know that because the Williams review, which was warmly welcomed by the Minister when he was chairman of Network Rail and was supported by the Conservative Government at the time, gave an alternative way forward, so the decision to nationalise the whole thing is particularly spiteful. The only explanation for it—because it is not necessary for the purpose of achieving the Government’s stated objectives—is that it has been done to pay off the trades unions that made such generous contributions to Labour’s victory at the polls in 2024.
We know that privatisation has been a huge success on the railways and that passenger numbers increased enormously after privatisation. It would be astonishing if the Government nationalising the railways achieved anything like that increase in passenger numbers. New operators entered the market and competition stimulated improvements.
I have four amendments in this group, but one of them is consequential, so three that I intend to speak to. My Amendment 2 addresses a particularly vicious little clause in the Bill, which says, first of all, that the body designated as Great British Railways has to be owned wholly by the Crown. In other words, a future Minister would have to pass primary legislation to redesignate or designate a different body in the private sector to carry out Great British Railways’ activities. What is the need for that? It is simply to gratify the trades unions. A second part almost seems to impose a penalty of some sort on any Minister who makes even a suggestion that Great British Railways should be transferred to the private sector. My Amendment 2 deletes that part; it does not stop Great British Railways going ahead as a nationalised body but it allows a future Secretary of State without the need for primary legislation to redesignate a different body, not necessarily owned by the Crown, to carry out the role of Great British Railways.
Amendment 1 is addressed at sloppy drafting more than anything else. The Bill talks about a body corporate being designated as Great British Railways, whereas later, in the next clause, it is implicit that the body corporate should be a company constituted under the Companies Act. But the Bill does not actually say that the body corporate has to be constituted under the Companies Act; it only says that it has to be wholly owned by the Crown. Other bodies corporate could be designated, as long as they were wholly owned by the Crown. It is simply sloppy drafting not to say at this point that it is to be a body constituted under the Companies Act.
When I mentioned this to the Minister, he said, “Oh well, everybody knows it’s going to be a company constituted under the Companies Act”. Well, they do not, if they read the Act—it needs to be written into the Act by him that that is what the intention is. It should say quite explicitly that that is what he intends to do. We will come back to this when we discuss amendments later in Committee that relate to the board of this company. There are some from the noble Baroness, Lady Pidgeon, to which I have added my name, about the board of this company and how this corporate structure works, because the Bill is very silent on that. This needs to be done.
Finally, Amendment 8 probes Great British Railways’ organisational structure. To this day we still have no idea at all—and maybe the Minister has no idea at all—how Great British Railways is going to be structured. Let me give a couple of options. It could be that it will be structured geographically, roughly mapping the existing structures, so that one division deals roughly with the south-western main line, one division deals with the east coast main line, and so forth. It could be structured like that, but you could have a totally different structure. There might be an argument for saying that we should have one division that deals with operating the railways, one that deals with managing the major stations, another division that deals with the minor stations and another again for retail. You could have an organisation that was completely functionally based rather than geographically based. These are important questions, which I think Parliament should have a chance to have a say on, yet not only is the Bill silent about them but the Government are silent as well. The effect of Amendment 8 is to require the Government to publish their organisational structure before the Bill can come into effect.
That is enough for the moment—I understand that other noble Lords have things to say. I will just say in advance—and I hope that the noble Baroness will forgive me for pre-empting her—that I have taken note of the amendments in the name of the noble Baroness, Lady Jones of Moulsecoomb. They are not wholly aligned with my view of the role of the private sector and she will not therefore, I think, be surprised if I find myself not able to support them. I beg to move.
Lord Lansley (Con)
My Lords, it is a pleasure to join this first group in Committee. I am sitting to the left of the Liberal Democrats because that is where I now find myself; I always want to be sitting behind my noble friend on the Front Bench in Committee to back him up, but I cannot do that because there is no back row in this Room, so I cannot be self-effacing in the back row. Anyway, I look forward to Committee. I do not have the experience of railways that the Minister and my noble friend speaking for the Official Opposition do—I do not pretend to that intimate knowledge of the railways—but I hope to bring something of my interest in how competition should be applied in the delivery of public services to some of the issues that we will be debating.
I turn to this group. There are a number of amendments in my name which are just about trying to find out, as I was going through the Bill, whether it works in the way described or precisely what it means. Rather in line with what my noble friend was just saying, we need to be sure that we understand that the Bill is functionally correct in the way that it works. I have just two amendments in this group.
Amendment 3 relates to the question of what must be wholly owned. As my noble friend said, Clause 1 is constructed around the proposition that Great British Railways not only must be wholly owned by the Crown but cannot be anything else. That relates to GBR itself. The purpose of Amendment 3 is to test whether that also applies to GBR companies. We do not encounter GBR companies in Clause 1, but we do subsequently as a means by which GBR will undertake its activities. This is not surprising. As my noble friend said, we do not know how GBR will be corporately structured but, by way of example, we know how Network Rail is structured. It has a significant number of wholly owned subsidiaries and quite a number of joint venture subsidiaries, including through Platform4.
For example—and here I declare my interest as chair of the Cambridgeshire Development Forum and others—Platform4 is a Network Rail subsidiary company that has just recently, happily, entered into an agreement with partners to develop at Cambridge North station as part of the Government’s proposal to develop around stations, with 450 homes around the station. It is a joint venture company; it is not wholly owned by Network Rail. So my starting proposition is that this prohibition on companies not being wholly owned must apply to GBR itself but cannot apply to GBR companies. I want to be sure that that is the case. If it is not absolutely clear in the statute then it ought to be, which would be the purpose of my amendment.
That differentiates the amendment from those in the name of the noble Baroness, Lady Jones of Moulsecoomb, to which we will no doubt turn in a minute, who wants precisely that to be the case. For the reasons I have just explained about the many joint ventures for things such as housing developments and commercial developments around stations through companies such as Platform4, if I may respectfully say so before she has put her case, I do not agree with the noble Baroness that all GBR companies should be—
Baroness Jones of Moulsecoomb (GP)
My Lords, with the permission of the Chair, I will do something I have not done in the 13 years I have been here as a Peer. The place name in my title is “Mole Skoomb”, okay? There is a railway station at Moulsecoomb, near Brighton; in fact, it is not in Moulsecoomb but in Bevendean, which is a source of great irritation to people living in Moulsecoomb; Moulsecoomb is a mile up the road. Anyway, it is pronounced “Mole Skoom”. Thank you.
I said in my speech at Second Reading that I welcome the Bill; the Green Party has long argued that our railway should be run as a public service, not for private profit, and that is exactly where my five amendments here are going: they all make basically the same point. It was very kind of the noble Lord, Lord Moylan, to point out that he did not agree with me; in fact, it sort of made me feel slightly better because, worryingly, there are times when I do agree with him, so it is good to get back on our tracks.
Baroness Jones of Moulsecoomb (GP)
Sorry, I did not mean that.
What I am trying to do with these five amendments is to make sure that public ownership of our railways really means public ownership. The Bill, as it currently stands, could allow companies within Great British Railways to have private shareholders. The Bill is, or should be, about bringing our railways back into public ownership, and we therefore should not be creating a back door that allows private ownership to creep in.
This is the worry that the Association of British Commuters, We Own It and Bring Back British Rail have brought to us. They and the others are asking a very simple question: what exactly do we mean when we say that Great British Railways will be publicly owned? At the moment, the answer is not clear in the Bill. The Government made a welcome commitment that all the shares in the parent company of Great British Railways would be publicly owned, but does that extend to the companies sitting beneath it?
The Bill defines a GBR company as a subsidiary within the meaning of the Companies Act 2006. A subsidiary does not have to be wholly publicly owned; it can be partly owned by private investors, provided that the parent company retains control. We could have a railway where the parent company is entirely publicly owned but where companies carrying out important railway functions have private shareholders. Does that not fundamentally change what public ownership means? The Passenger Railway Services (Public Ownership) Act 2024 used a much clearer definition: a public sector company had to be wholly publicly owned. The Companies Act itself provides the Government with the wording they could have used if they intended to require wholly owned subsidiaries. I think we have to ask this: why was that stronger definition not used here?
This is not helped by the Government not being clear about exactly which functions GBR companies will carry out, as the Bill gives these companies the ability to carry out potentially any GBR function. That could include train operations and infrastructure management, which leaves the door open to a very different railway in the future. In a worst-case scenario, the new definition of GBR companies as subsidiaries could even lead to the part-privatisation of rail infrastructure management—a direction of travel thought impossible in the UK since the days of Railtrack.
Railway privatisation has been a disaster: it fragmented the railways, drove up costs and put private profit ahead of passengers. We should not be creating a structure today that would enable a future Government to say, “Well, the legislation already allows private investment and we’re simply making use of the powers that Parliament has already given us”. These amendments would stop that happening. I should also say that I have not yet had the delight of meeting with the Minister, but I am sure that that is in progress.
Lord Hendy of Richmond Hill (Lab)
I am grateful to the noble Lord. My experience of Network Rail’s property and Platform 4 is offset by increasing age and failure to remember the details. I will not only write to noble Lords about the 50:50 aspect, but about Mayfield, which I remember vaguely is of a different percentage, partially because much of the land is owned by somebody else rather than the railway. I will write on both those points, because I think they are germane. I appreciate the point that people need to understand how this will work in practice, particularly with those areas of activity of GBR that are not the provision of passenger railway services or the basic railway.
Lord Moylan (Con)
My Lords, before I start, may I add to the comment made by my noble friend Lord Lansley? My example is not a Network Rail example, but a TfL one, with which the Minister will be very familiar: the Earl’s Court development. The essential structure is that the initial ownership of the joint venture was based on the value of the land that each party was contributing, but that the TfL structure would fall well below 50% over the course of time, as more investment was added by the private sector partner. Structures such as that would simply not be possible for Great British Railways land under this Bill, because you could not go below the 50%. So, a site such as Earl’s Court, if it were a national Network Rail site— pari passu, mutatis mutandis—would of course remain undeveloped until the Government found the money to develop it. The Government will never find the money to develop these things.
Turning to the debate that we have just had, I must say that, whenever I speak in Committee, I always seem unwittingly and unintentionally to attract the disappointment of the noble Baroness, Lady Pidgeon. I am surprised about this, because the only reference I made to her in the course of my speech was to say something complimentary about amendments that she has tabled, which we will debate later in Committee and to which I have added my name. Obviously, I am at fault in some way, in that I am constantly giving her cause for complaint.
On the question of organisational structure, the Minister has read out some words about how Network Rail will be organised, but they do not provide a level of assurance or satisfaction that people are looking for. They are very woolly, but I will leave that and grant him that for the moment; he can stick with that level of woolliness. However, let us switch focus slightly and think about timing. When I spoke on the then passenger railway services Bill when it was in your Lordships’ House, I said that the Government were embarking on a very long multi-year transformation process. Here we are, two years later, and we still have not completed that. We are at least six months away, I should guess, from seeing the enactment of this necessary legislation. That is two and a half years on.
Transforming an organisation as complex as Network Rail and all the companies being brought into this group is something that is going to take years. So let me change the question: is the Minister able to say, before we conclude this debate, at what time he expects that structure to be in place, which he has described to us even in woolly terms?
Just to develop that a little further, it is said throughout the industry, although it is acknowledged that nobody has written this down, that the intended designation date for Great British Railways is October 2027, which is 12 months from now—say, six months after the enactment of the Bill, if it goes through in its current form, according to its current plans. Is that date valid? Does the Minister believe that the structure that he has described in whatever woolly terms will be in place in time for that designation date, or is it all going to muddle on for years afterwards, being put in place?
Finally, on the second important point that we have discussed in this short debate, I express my gratitude to—I am going to say this correctly now—the noble Baroness, Lady Jones of Moulsecoomb. Kudos! But do not minute that in Hansard. I am very grateful to her because she put her finger on one of the key issues in this group, which is the question of the justification for private ownership. She has said, effectively, that it is party policy, in her case, and she is going to stick to it, for that reason if not for others as well. But we did not get a clear answer from the Minister to my question: what is his justification for wholesale nationalisation for the purpose of achieving his objectives, which could have been achieved by a Williams report approach? It is wholly irrelevant whether the last Government did anything about it, for heaven’s sake—what is the point of making a comment like that? The last Government were all over the place; that is why they lost the election. Is that the standard that the Minister is setting for the Government, that they are just about better than Sunak? Is that it? Is that the point of making that remark?
The Minister has one further opportunity to give us a clear explanation. The only explanation that he has given is that it is in the manifesto. If that is the sole explanation, that is very helpful to us, because knowing that there is no rational basis for the decision makes it very much easier for an incoming Government to advance the argument that the necessary measures should be taken at pace to reverse it.
Lord Hendy of Richmond Hill (Lab)
My Lords, first, the operative date for Great British Railways will be sometime in 2027, but of course it depends on the passage of this Bill. Secondly, I can give a very sound explanation for being in favour of public ownership, which is that progressively, as we have taken recent train operating companies into public ownership, we have been able to put both the track and infrastructure and the operations into the management of the same person. That is delivering results that no previous arrangement for over 30 years has been able—
Lord Moylan (Con)
Why, if that is such a good thing, are there fewer and fewer services?
Lord Hendy of Richmond Hill (Lab)
I shall continue with what I was saying. It has not been possible, in any previous iteration of the railways since the early 1990s, to have both under the same control. There was such an arrangement with South Western Railway in the 2010s, and it collapsed, because the commercial arrangements were incompatible. We are making steady progress in improving the railway in some pretty difficult circumstances, in companies that had not been particularly well managed, as a consequence of being able to manage them together. To my mind, that is a very good reason for public ownership.
Lord Moylan (Con)
My Lords, I am very happy, in so far as that is directed at me, to bear it in mind. Of course, I could be quicker in challenging the Minister when I sum up. I am not summing up, of course; I am actually testing him on his response to the points I made in moving my amendment. I would be a great deal quicker if he had properly addressed them to my satisfaction in the course of his speech. When Ministers do that, I shall of course be briefer. But, if the Minister does not do that, then, with every respect to the noble Lord, I shall take exactly as long as is needed, because we are in Committee and those rules do not apply. I will not be curtailed. After all, thanks to the noble Lord and the Whips, we have five hours, not four, to play with.
The Deputy Chairman of Committees (Lord Duncan of Springbank) (Con)
It sounds like I have missed the best bit.
The Deputy Chairman of Committees (Lord Duncan of Springbank) (Con)
Does the noble Lord wish to withdraw Amendment 1?
Lord Moylan
“Purpose of Great British Railways(1) The purpose of Great British Railways is defined by the following objectives—(a) prioritising the needs of Great British Railways passengers in decision-making,(b) delivering reliable, safe and accessible railway passenger services,(c) providing value for money for passengers and taxpayers, including consideration of the affordability of fare prices,(d) increasing passenger numbers and growing usage of the network year-on-year,(e) expanding and improving the network, including services and connectivity, and restoring or adding routes,(f) modernising working practices and innovating to improve productivity, efficiency, and passenger experience,(g) supporting economic growth and national productivity, and improving connections between towns, cities and employment centres,(h) improving the experience of disabled and vulnerable passengers and ensuring consistent access to assistance, (i) ensuring fair and transparent treatment of open access, freight and devolved operators when allocating access and charges,(j) growing rail freight, including supporting delivery of the national freight growth target,(k) strengthening the financial sustainability of the railways, reducing reliance on operating subsidy over time,(l) integrating track and train, simplifying structures, and avoiding duplication, and(m) supporting multi-modal integration with buses, trams and local transport networks.(2) The Secretary of State and Great British Railways must have regard to the purpose set out in subsection (1) in exercising their functions under this Act.”Member’s explanatory statement
This new clause defines Great British Railways’ purpose.
Lord Moylan (Con)
My Lords, I rise to speak, with my customary brevity, to Amendment 7 and to open the debate on this second group. I have a large number of amendments in this group, so I shall speak only briefly to each of them because I do not want to provoke any noble Lords to start waving their hands at me again, which is only intended to distract and does not promote debate.
Although Amendment 7 starts the group, I intend to return to it towards the end of my remarks. I will start with Amendment 9, which may appear to be pernickety, but I will explain it to noble Lords, many of whom will know that I have a background in local government. But it is not entirely a local government matter; it applies to legislation more broadly. We are well familiar with the notion of powers. Local government is given powers to do things, and so is the Secretary of State periodically. We are also familiar with the notion of duties—we are clear what the distinction is—which can be placed on local government and, similarly, on the Secretary of State. I do not claim huge experience, but I have never come across the question of functions, and I do not understand what a function is. It is sloppy drafting. Is a function a legal power? We understand what that is. Is it a duty? When does a function slip over into being a duty, and vice versa?
But then I go to a second level of refinement. Clause 3 refers to the “general functions” of Great British Railways. If I am unclear what a function is, I am doubly unclear what a general function is. It could be that this is a fuzzy notion—it is a general thing and we are not quite clear what it is—in which case it is not very satisfactory as a piece of legislation. Or it could seek to set out a hierarchy of functions, where these are the general functions and there are other more minor functions that sit under them but have to conform to, contribute to and be ancillary to the general functions. Is that what “general functions” is meant to mean, or is the word “general” simply redundant? I ask because later the Bill refers to “the functions” of Great British Railways on several occasions and the expression “general functions” never reappears.
I suspect that this is not a very complex issue. I suspect it is just sloppy drafting. But we cannot put up with that—we need to know what is meant by functions, how many duties are being imposed on Great British Railways that we can hold it to account for, how many powers are being given to it by statute that it has to explain and justify using or not, and whether “general” is creating a hierarchy with subordinate functions that must comply or not. I do not think this will necessarily be settled today; it is very likely that we will come back to this so that we really understand what the Bill is doing.
Amendment 13 would exclude rail safety advice and standards from Great British Railways. Under Clause 3(1)(g), Great British Railways will be
“publishing advice and standards on matters related to railways and railway services”.
I really do not know why it is doing this. Publishing advice and standards is normally the function of either a regulator or an independent standards board. I do not know why Great British Railways is doing this. In so far as it is doing it to itself, that is okay. I have no objection to its setting internal standards. However, my Amendment 14 says that it should not be able to create standards and issue advice to non-GBR actors on the Great British Railways network. Internal standards are no problem, but if standards are to be set then they should be set by an independent board, a regulator or the ORR.
Finally on this point, Amendment 13 would exclude safety standards entirely from that scope. I say this because safety on British railways has been at a very high standard and it is a common view that the role of the Office of Rail and Road as safety regulator has been an important contributor to that. I do not want to see its role diluted, and I do not know anybody in the industry who does. The danger here is that the power being given to GBR to set standards implicitly for other people operating on the railways, implicitly including safety standards, creates a tension with the role of the ORR that can be only destructive of and damaging to the effectiveness and reputational safety of Great British Railways.
Amendment 18 relates back to the question of functions. It would remove the Secretary of State’s power to confer additional railway-related functions on Great British Railways. If it requires an Act of Parliament to set up the general functions of Great British Railways, why should we want to give the Secretary of State the undiluted, unrestricted power to create new functions to add to them? I do not think this is the correct way of doing it. If there is a requirement for further functions in future, it should at the very least be done by statutory instrument, if the power is to be granted at all.
I turn to Amendment 80. My noble friend Lord Grayling, with his very considerable experience of the railways from being Transport Secretary, has tabled a number of amendments but unfortunately is unable to be in the House this week. But I have signed Amendment 80 in its support, so I will speak to it. It is slightly out of place in this group, but we will come back to this topic eventually.
The amendment would require that charges imposed by Great British Railways for certain railway services are “reasonable”. Who can object to that? Who would want charges that are not reasonable? But that is not the power given to Great British Railways by the Bill. The power to make these charges is relatively unconstrained— I agree that it may be constrained by competition law—and would, in effect, allow GBR to set charges as it sees fit. That is too much latitude; the power should be constrained by the necessity for charges to be reasonable.
Amendment 81 is, in fact, in my name, but is close to the previous one. It would give to an individual—it might be a company—who is aggrieved by the charge, term or conditions imposed by Great British Railways a right of appeal to the Office of Rail and Road. Again, who would think that this very modest constraint on the absolute discretion of Great British Railways could be anything other than reasonable and necessary? I beg to move.
Lord Davies of Brixton (Lab)
I am keen not to be seen as a support act to the noble Lord, Lord Moylan, although some of my remarks might echo points that he made in the previous group.
Amendment 15 would place on Great British Railways a duty to act as a single employer for the staff transferring into it from Network Rail and the train operating companies, as they move into public ownership. The starting point is that the Bill is silent on this question. It creates Great British Railways and sets out its functions, and it deals in some detail with the machinery of transfer, but says nothing about who will employ the people who run the railway. There are well over 100,000 people involved: more than 40,000 are directly employed by Network Rail and there are more than 60,000 across the train operating companies. They are no clearer today about who their employer will be than they were before the Bill was published.
This matters more than it might appear. The operators are coming into public ownership on a staggered basis, contract by contract, over several years. The uncertainty is therefore not settled by a single moment of transition; it is spread out and repeated. Staff in one company would inevitably draw conclusions from what happens in another. In the absence of a stated employment model, people will assume the least favourable one: that subsidiary companies will be retained, terms and conditions will diverge and the integrated railway will turn out to be a holding company with much of the same fragmentation underneath it. I hope that this is not what the Government plan.
The founding document here is Getting Britain Moving. Those interested in the reason for putting the railways into public ownership would find their time well served by consulting that document, which addresses the issues in contention today. That document was explicit that Great British Railways would be “a new, single employer” and that the workforce would be treated
“as an asset to be nurtured rather than a cost to be cut”.
That was a clear commitment, and these amendments asked for it to be put in the Bill or, failing that, restated from the Dispatch Box.
Lord Hendy of Richmond Hill (Lab)
My Lords, I thank noble Lords for these amendments and the noble Lords, Lord Redwood and Lord Harper, for their contributions.
I start with Amendment 7, which would introduce a purpose for GBR into the Bill. The Bill already provides a purpose for GBR, just as we promised the Liberal Democrats it would during the passage of the public ownership Act. The Bill’s purpose is set out through its functions and duties. The functions tell us what GBR must do, and the duties tell us what GBR must consider and achieve while doing it. Much like the noble Lord’s amendment, the duties provide a list of objectives for GBR, which it must bear in mind when undertaking every decision and its railway activity.
I hope the noble Lord can see that the duties are in fact similar to the breadth of outcomes his amendment is seeking. The duties already require GBR to prioritise the needs of passengers and disabled passengers; to consider value for money, high standards of performance including reliability, social and economic benefits, and the environment; to grow freight; and to advance the public interest. We do not need a new purpose clause to provide GBR with these objectives: the Bill already does so.
Unlike the proposed purpose clause, the functions and duties are supported by the Secretary of State’s long-term rail strategy, which will also provide clear long-term objectives. That strategy is how Ministers will communicate to GBR what it should consider while planning, expanding and improving the network over the next 30 years, and GBR will develop its own pipeline of projects in response to that. Rather than a static requirement in the Bill which is not set in the context of wider priorities or funding expectations, we have a system that might actually work better to make our railway better. Instead of setting out a clear purpose, the proposed new clause duplicates many of the provisions already in the Bill, making outcomes less clear and, overall, less likely to be deliverable.
Amendment 9 is seeking clarification of what “general” means. A general function is an umbrella term for an activity which a body can undertake by doing lots of different things. For example, running passenger services involves a large number of intermediate actions such as procuring and operating rolling stock, employing train drivers and other staff, and selling tickets. The Bill requires GBR to run passenger services as a general function, and it therefore does not prescribe exactly what actions it should take in which order to do that.
In comparison, a specific function would be an individual action that the Bill requires GBR to do at a certain point or in a certain way. An example of this would be the requirement on GBR to draft and issue the access and use policy in Clause 59. This is a specific requirement to kick off the access process and not a general function.
The term “general” is therefore helpful in distinguishing between a specific activity that GBR is required to perform and the continuing business of GBR in running the railways. I assure the noble Lord that functions are a standard drafting approach, used also, for example, in the Communications Act 2009, the Climate Change Act and others. I hope that this explanation provides the clarity that the noble Lord seeks and that he can withdraw his amendment.
Lord Moylan (Con)
My Lords, if the Minister would be so good, this really is very important. I did not think he would adopt that approach, but it is one of the two approaches I offered him, and he has chosen to adopt that which says that this is essentially hierarchical, so that the general functions set out in the Bill subsume a whole load of subsidiary and ancillary functions. I am still not clear whether these functions are powers or duties. Does GBR have some choice over whether to carry out these functions—in which case, they would be akin to powers—or is it obliged to do so?
My key question, now that we have established that, is this: to carry out a general function, there are a whole load of subsidiary and ancillary functions you may have to carry out. I understand that completely, and the Minister did not have to give examples, but he did very helpfully. Is the functionality, so to speak, of Great British Railways therefore limited to the functions set out in this clause? In other words, can it do anything else or is it limited to doing the things that are general functions here? Does it have the power to carry out any other activity? These are really important questions, which may end up being tested in court. I know he has quoted some examples but, because generally unfamiliar language is being used, it is unclear to me whether we are talking about the general functions being the full scope of GBR’s activities or not.
Lord Hendy of Richmond Hill (Lab)
I thank the noble Lord for that. I am at least clear about this. The functions are more like powers; the duties are the things that GBR must do when doing the functions, but it is not limited to those general functions. Indeed, we have already discussed quite extensively what it might do, for example, in property development and with third parties, which, because it is a Companies Act company, it can do. I think that is reasonably clear. I would be happy to discuss this with the noble Lord in more detail, because I think we are getting tied up in nomenclature. I think it is reasonably clear what GBR’s functions are, which are described in Clause 3; it describes running the railways. It is also clear that, in the process of running the railway and because of its activity, it is able to do a number of other things.
Let me carry on to Amendment 12, if I may. Amendment 12 would require GBR’s functions to facilitate the provision and use of railway services to be carried out in a fair and non-discriminatory manner. I absolutely agree that GBR should act fairly; however, the duties in the Bill already require GBR to act in the interest of the public, taxpayers, passengers and freight customers. GBR will act fairly in accordance with its duties, not only when exercising this function but across the full range of its statutory functions. We will no doubt discuss this more when we discuss ticket retailing and access. For now, suffice it to say, there are already protections in the Bill—and indeed in wider statutes, such as public law principles and the Competition Act, which applies in full to Great British Railways—that will require GBR to act in a manner that is fair, non-discriminatory and not anti-competitive. This additional requirement would duplicate only the Competition Act requirements, adding uncertainty and administrative burden without increasing protection for non-GBR operators.
Amendments 13 and 14 relate to the publishing of advice and standards for the railways. I thank the noble Lord for this probing amendment, and I reassure him that the ORR is the sole safety regulator for the railway. The Bill does not transfer the ORR’s safety regulatory functions to GBR, nor does it change the current railway safety regime at all. The ORR will continue to exercise its independent safety, regulatory and enforcement functions, including its ability to ensure that GBR and other operators comply fully with all safety legislation requirements.
Comparatively, GBR’s function to publish standards is a reference to technical standards, which GBR would publish and share with industry as a method of promoting best practice. This is similar to today; at present, Network Rail and the train operating companies develop and publish technical standards covering many aspects of their operation. These standards include operation and maintenance protocols, design specifications and engineering guidelines. This does not in any way prevent it adhering to the ORR’s safety regime, which it is required by law to comply with. This also does not give GBR any remit over safety regulation. The standards are non-binding and designed simply to support shared learning across the industry.
Lord Hendy of Richmond Hill (Lab)
The obligations placed on GBR by the long-term rail strategy, and the consequent approval by the Secretary of State of the business plan, should adequately deter Great British Railways from seeking to achieve that by diminishing services. Indeed, there was an example in the franchising era of the Government being loose with their definition of train services, only to discover that the franchisee had, remarkably, reduced the subsidy by withdrawing a number of services on rural branch lines. That clearly would not be possible with a decent long-term rail strategy and a consequent business plan to which a Government should agree.
Amendments 80 and 81 relate to the Clause 13 provision allowing GBR to charge for its functions. I agree that GBR must act reasonably while setting charges, and I assure the noble Lord that there are already safeguards in the Bill to ensure that charges are reasonable. GBR has a duty to ensure that railway service providers, such as other operators, can plan, invest and make decisions about their own businesses, so GBR must set charges that are consistent with this and do not undermine other people’s ability to run viable and successful businesses.
Competition law will apply to GBR, ensuring that charges it sets are not anti-competitive. In this context, an additional reasonableness test is duplicative without delivering any material additional protection. It is also important that GBR can recover appropriate costs from those who access and benefit from the services it provides. If it were prevented from doing so, the burden would ultimately fall on the taxpayer and passengers.
Amendment 81 would provide an appeal route. All I say to the noble Lord is that an appeal route to the ORR across every possible charge that GBR could levy is disproportionate. I have already mentioned the safeguards in existing law to ensure that those charges are fair.
On the private sector growth target referred to in Amendment 114, nothing in the Bill seeks to exclude or marginalise the contribution of the private sector, but I do not agree that a statutory target is the right approach. The Bill is absolutely an opportunity for the supply chain, but in that case, we have to let the market determine its contribution.
On Amendment 305 from my noble friend Lord Berkeley, I assure him that existing legal rules already allow railway operators to seek recovery of costs and other losses through civil law. A substantial amount of cost recovery is achieved already, and the limit to it is to do not with legal powers but with the identification of perpetrators who drive off. Given what I have set out, I encourage noble Lords and noble Baronesses not to press their amendments.
Lord Moylan (Con)
My Lords, I begin with a craven apology to my noble friend Lord Harper for my comments about the Sunak Government. For the avoidance of doubt, had the last general election been fought solely on the question of his conduct of the office of Secretary of State for Transport, I am sure the result would have been very different and more favourable to the Conservative cause.
I will not refer here at any length to the question of functions, except to say that it is a mess. At the end of this debate, everybody in the Room who has thought about it can probably see that it is a mess. However, the Minister kindly offered me a meeting to discuss this, and I think my noble friend Lord Lansley is now very much included in that invitation, and possibly other noble Lords. I ask that that meeting takes place reasonably promptly as these issues will return at later stages in Committee rather than being left to the end of Committee and rushed through just ahead of Report. A sensible meeting on that could be very valuable.
I will comment about the noble Lord, Lord Davies of Brixton. I do not agree that there should be a single employer as such, although I think there will be one because I think the unions will get their way. My noble friend Lord Harper explained the danger to the public of going down that route. I fully expected—and was disappointed—that the noble Lord, given his background, would refer to the difficulty with pensions, particularly the fact that all these organisations currently have individual pension schemes within the Railway Pensions Scheme. Is the Minister satisfied that it will be possible, in the timescale he is working towards—namely, the designation of GBR in the second half of next year—for the Railway Pension Scheme trustees and Railpen to achieve a smooth and lawful transition of pension arrangements in that time? He may not be able to answer that question now, but we must find some way of coming back and discussing this because pensions are a very important aspect of the remuneration of the employees.
Baroness Pidgeon (LD)
My Lords, this has been a strong debate on an important issue. It is about ensuring that passengers have a wide range of retailers from which to buy their tickets and other associated services, whether for leisure or onward travel and so on, and that there is a level playing field between Great British Railways’ retail arm and the third sector providers. At the start of the discussion on this group, the noble Baroness, Lady Harding, and the noble Lord, Lord Young, made a clear case about the issues, which are uniting members from across the Committee.
Throughout the discussions on all the amendments in these groups there has been a desire for genuine and fair choice for passengers. We want to promote a competitive retail market and equal access to systems, data and products so that they can be used by start-ups and others as well as established practitioners in this area. The latter point is important. It is part of Amendment 211 in the name of the noble Lord, Lord Young of Cookham, and is supported by a number of other Members, including my noble friend Lord Dixon of Jericho. I want to spell out why these issues are so important.
I was really interested to hear about the recent product launched in Wales earlier, which not all third-party retailers were able to promote. In the last week, South Western Railway has had a special discount, some kind of flash sale, on rail tickets on its services. I was not able to find these on my usual app—Trainline, though others are available—but only on the South Western Railway website, which is what I had to use to purchase these super-discounted tickets. It may well be my technological limitations failing me, but, if I had not seen an email from South Western Railway, I would not have known about these special tickets and would have ended up paying three to four times the amount for my travel.
There has to be a genuine level playing field where all retailers can sell the same tickets and discounted tickets and use their skills and innovations to drive more traffic through their sites and apps. Different people read data and information in different ways, and that is why we have such a range of apps; we all look at things differently and have different ways we want to purchase tickets. It is important that this can thrive, with the jobs and innovation that this creates.
Members from different parties are in the same area on this issue, but some go further. Amendment 17 from the noble Lord, Lord Moylan, wishes to prevent Great British Railways having any retail website or application until Parliament has had a say over its full-life cost. This sounds a little bit like what the noble Lord, Lord Harper, was talking about—when he was in the department saying, “Why is Great British Railways getting into this space at all?”
As we have already heard, if you look internationally, SNCF has a retail arm in France, but it is kept separate from the main SNCF network, so there is no conflict. In some ways, that is a bit like the regeneration and planning functions of a local authority. They are a part of the same body, but they have to be kept separate because of their distinct functions. Amendment 182 from the noble Lord, Lord Holmes of Richmond, suggests a way to do this, which may help with this concern.
My noble friend Lord Dixon of Jericho spoke eloquently at Second Reading about this area. I know he has held several meetings with officials to discuss his concerns not just about the existing third-party retailers but the ease for new entrants—start-ups—to come into this marketplace and offer the quality services that passengers desire.
Finally, I want to pick up on Amendments 208 and 339, tabled by my noble friend Lady Leaman. This is so important for passengers. It would ensure automatic Delay Repay compensation, whichever retailer you have bought your tickets with. It is about putting the passenger front and centre so that, if something does go wrong, they are compensated without having to jump through hoop after hoop. It is a basic right if we are to transform our railways into the modern, passenger-focused service that we all desire.
I look forward to the Minister’s response on this really strong debate; I hope that it is far more than simply saying that the retail code of practice, as an approved document, will deal with all these issues. I think the Minister will have heard loudly and clearly—and not just from the transport enthusiasts, though many of us are here in this Room—that noble Lords are rightly concerned about this area, and we must get this right.
Lord Moylan (Con)
My Lords, I have a number of amendments in this group, but I will not speak to them because right at the outset my noble friend Lady Harding said that there were quite a lot of amendments in this group which offered different means of achieving the same thing, and it was hard to say which were the better ones. I am not claiming that mine are better than others, and I think my noble friend Lord Harper said something along the same lines. We have put them down because we feel strongly about a very important issue, we want it debated, we want the Government to take note and to do something about it before we get to Report. Whether they do what my amendment or somebody else’s amendment says is something we might have a chance to debate and discuss privately before we get to that point—I do not know—but I am not wedded to my particular solutions and therefore will not speak directly to them.
I will say that we on our side support everything that has been said, in that we are curious about why GBR is doing this. I will come back to this point; I will make the Minister’s case for him in a moment, rather against my own interests. We are curious as to why the Minister wants to do this in the first place but, if he is going to do it, there has to be a level playing field for those who are already in the field and other new entrants, because they have demonstrated the advantages they can bring to passengers. The difficulty here—it will arise in the next group—is that GBR is effectively a huge bear sitting in your front room. That bear is both a competitor and a regulator, and its slightest twitch, even unintentionally, could do serious damage to your business. There are a lot of private sector businesses, not just in ticket retailing but those who want to have access to freight and for other purposes, which we will come to later—open access and so forth —which are very worried about what is being created.
The only assurance we are getting from the Minister is essentially, “We are decent professional people; we will do this well”. That is fine. The noble Lord is a decent and professional person. Having worked with him for many years, I am happy if it is of any value to him to give him that endorsement. However, he lacks the quality of immortality. It is necessary to give at least 30 years’ guarantee, if this is going to be the legislative background for 30 years.
Lord Moylan (Con)
He may do that. He lacks the ability in himself to give us the level of assurance that we and various aspects of the industry—not just retail—want.
I am grateful to the noble Lord for having held a meeting, which was open to all interested Peers, last week. I will say something that I raised then. I have to say that I had to slip out briefly during my noble friend Lord Holmes’s speech. He may have said something along these lines. I know he spoke about data.
Lord Moylan (Con)
It was a very good speech that I will read several times in Hansard before tomorrow is out. I just wanted to address what I would do if I were in the Minister’s position—and he and I have been in a similar position together when we were responsible for Transport for London. One of the interests you have as a business in operation is that you want the direct contact with your customers. You want direct customer contact, partly because you want the data. The noble Lord has said this—we have had some conversations, both privately and in that meeting. You want their data. This is perfectly obvious.
In my pocket now, I have a Nectar card and a BP card. I am carrying these things around, not really for my benefit but for the benefit of the companies, which want lots of data and information about me. GBR will be in no different position. Therefore, in one sense, it wants to be, like TfL, a monopoly supplier of its own tickets. The temptation to be a monopoly supplier of its own tickets will be huge, quite apart from any pressure that might come from the Treasury or anywhere else, because it wants that data.
Yet the position of the noble Lord seems to me slightly incoherent. He could step forth boldly and say, “We want that data. We need to be a monopoly supplier, and all these private companies, whatever they do, have to go, because they are getting in the way of what we want. You cannot buy your groceries from Sainsbury’s through a third-party retailer—you can only buy them from Sainsbury’s”. He could say that. That would be a coherent position, although not a politically very easy one in current circumstances, I have to say. Or he could say that he is happy to have a large amount of competition, which is what he seems to be saying.
I can be corrected if I am wrong—I have heard this figure without absolute certainty in it—but I understand that close to 90% of tickets are currently sold by third-party retailers on the railways, so when the noble Lord starts, he will be starting from a very low base. To get any useful data at all on his customers, he will have to build up a huge customer base from a very low start. Is that his intention? Does he regard that as a business goal, and if so, what does it say about his strategy for dealing with the private sector?
I do not know what the answers to these questions are. It is difficult. It is right to look at this, as noble Lords have, from the point of view of the benefits of the customer. However, it is also worth thinking about the commercial imperatives that GBR will have and whether it should be allowed to pursue those commercial imperatives, or whether it should be constrained in order to benefit a competitive field.
Lord Moylan
“(2A) Decisions about access to, and use of, railway infrastructure for the operation of trains will be made by the Office of Rail and Road.”Member’s explanatory statement
This amendment seeks to ensure that the Office of Rail and Road continue to make decisions about access.
Lord Moylan (Con)
My Lords, there are two amendments in this group. I have extracted them because, if we thought that the last group dealt with private sector concerns of some significance, this group deals with much larger private sector concerns. One of the biggest fears of the private sector, particularly those who operate trains, is the question of access to the rails—access to the track. The current system is that an independent body, the Office of Rail and Road, decides on applications for access to the track. Network Rail decides what should be paid for that, but that is also supervised and approved by the Office of Rail and Road. So there is an independent balancing authority in place that makes these crucial decisions.
Who are we talking about? About 75% of the train movements on Network Rail’s track will be GBR movements. The other 25% are people who need access to that track. They need an independent body; they value an independent body deciding whether they can have that access. They are freight operators; they are what I will call regional operators, such as Transport for London with the London Overground network and Merseyrail; and they are the open access operators. Here, I also have to mention, although it will be debated separately, the heritage railway sector, which has made representations to us and no doubt to other noble Lords about its need for access to the track.
I said on the last group that Great British Railways was like a huge bear—though a friendly bear, in the shape of the noble Lord—sitting in your front room, and the slightest twitch could wipe out your business, even inadvertently. The fact is that this bear will be a regulator making regulatory decisions about access and will be a direct competitor for use of some of those tracks. I say “some” because there will be some tracks where there is sufficient capacity and everyone can have a go so there will be no problem, but a lot of the network is congested. GBR will have a powerful incentive to allocate to itself tracks that it needs for its growing passenger service. When it is not doing that, however, it will be held up by the fact that it also has an objective to increase freight. There is a number attached to that; I cannot remember the number just now, but it requires freight to be increased fairly consistently over a period in order to hit that target. Its second thought, if it is considering who is to have access to congested track, will be, “If it’s not us at GBR, perhaps we’re going to give it to freight”. But that will not be always; not all the freight people will get what they want. Then it will only be further down the line that it will be thinking about the other players that I mentioned.
Amendment 16 is straightforward. It would leave the current situation as it is and those decisions would be made by the Office of Rail and Road. Everybody would understand what was happening. Amendment 221 offers a fallback position. It says that, if the Government are going ahead with this, there must be a right of appeal to the ORR. At the moment, amazingly, having created this huge insensitivity, the Bill says that you can appeal to the ORR but its decisions will not be binding. They will, in effect, be advisory to Great British Railways. This amendment states that the process would be binding and that it would be done not simply on judicial review grounds—that is, whether GBR followed the right process—but on the merits of the case. That, I think, would be a good fallback. The Minister, in writing a very lengthy and helpful letter to noble Lords after Second Reading, said that, if we were to have an independent appeal body, it would create what he called a second directing mind, and he is not willing to have a second directing mind.
I just want to dwell on that for a second because I think it shows the difficulties that we are all going to have with this problem. It is true that you could say that the ORR in that capacity would be a second directing mind, but there are many other second directing minds. The structure being created by the Minister will not have a single directing mind; after all, the courts could make decisions about matters subject to judicial review that will be binding on the Minister. But the Minister does not say, “I wish to be excused supervision by the courts because that would be a second directing mind”. Again, of course, the Secretary of State has huge powers of direction over GBR built into the Bill, but the Minister does not say that that is impermissible because the Secretary of State would be a second directing mind. So to say that a regulator is a second directing mind—and to some extent all regulators are, where they exist—is not a defence to the claim that there must be somebody capable of giving the assurances to the open-access operators, regional government operators and freight operators that their case will be considered fairly and that the charges when set will be fair.
Then we come to another point. The Bill requires GBR to set a scale of charges for access to the track but then gives GBR the power to decide to set a higher charge for access to the tracks if it believes that an economically efficient operator can bear it. Of course, deciding what is an economically efficient operator requires a whole set of experts doing nothing but that. If you go to somewhere such as the Civil Aviation Authority, which has to make decisions about whether something is economically efficient, there is a whole suite of people working there who make these decisions. It is their expertise; they are economic utility regulators. The same thing happens with other utilities. There is no mention in the Bill, however, or anywhere else, that GBR is going to recruit that capacity, but none the less it is going to set itself up to make the decision about whether somebody is or is not an economically efficient operator and what they can bear. It will be able to set higher charges limited only by that consideration. None of this washes with the private, municipal or freight sectors. They simply do not accept this any more than the retail sector accepts what the Government are offering to it.
As with the retail sector, the private sector operating on the railway—it is very sad that the noble Baroness, Lady Jones of Moulsecoomb, is not here to disagree with me about this—has added huge amounts. The whole of the freight sector is privately owned, and nobody is suggesting that there is going to be any change to that. Open-access operators using white track spaces offer benefits. The heritage sector brings in a modest, but none the less very useful, income to this country. It is part of our tourism industry and very useful in that regard. It gives jobs, entertainment and value to people who live in the communities served by the heritage railways.
The purpose of these two amendments is to open up a debate on this very important issue, where the Government have been obdurate, despite all the representations made to them, but which I think will have to be addressed by this House. I do not think this Bill can leave this House with this structure in place. I beg to move.
Lord Hendy of Richmond Hill (Lab)
I thank the noble Lord for his question. I will not give it now but will come back to that in the debate. I should also say for the benefit of the Committee that Network Rail is publishing the access and use policy consultation tomorrow, which will apparently address the noble Lord’s questions on abstraction. I am sure we can debate his points further when we get to the detailed debate.
Lord Moylan (Con)
My Lords, it will not wash. The noble Lord did not give any explanation of why there should be an appeals system which cannot look at the merits of the case and cannot bind GBR. He says that we are going to come back and discuss this again. I am sure we will and I hope we will. We should be discussing it several times in Committee, and we will certainly be discussing it on Report. At the moment, I beg to withdraw my amendment, but I am absolutely clear that this will not wash.
Lord Moylan
“(e) such other body corporate as they see fit.”Member’s explanatory statement
This amendment seeks to explore why the Bill places limitations on Scottish and Welsh ministers as to the manner of their exercising their functions relating to the railways or railway services.
Lord Moylan (Con)
My Lords, Clause 4 deals with relations with the devolved authorities in Scotland and Wales. I have a number of amendments here—five, in fact. They all appear in a sense to be relatively minor but they go to the heart of the devolution settlement. They raise the question of whether the Bill is in line with the new Prime Minister’s policy—I know he has not been elected to anything but he is the new Prime Minister—of making devolution a reality. I will run through the amendments fairly straightforwardly and leave it to others to debate them and the Minister to respond.
One of the things that can be done is that any combined authority or devolved authority has a right to request. I always find this slightly offensive, because we are a free country—everyone has a right to request something from the Minister—but apparently, this valued “right to request” is going to be given. You can go along and ask GBR if it will run a service local to you, which might even be branded your way, to which you might contribute some of the costs. That is the general idea. I can understand that in relation to English combined authorities but not the devolved Administrations.
For example, I do not understand at all why Scotland should be confined by statute to running that service using Great British Railways. If the path is available and the service can be run, why should Scotland not make its own choice about who the operator of that service should be? As I understand it, that would not be possible under the Bill; it would have to be a GBR service. I think that is a bit insulting to Scottish devolution. The same applies to Wales. My Amendment 21 would correct that and allow them to exercise railway functions through a body corporate other than Great British Railways.
Amendment 145 goes hand in hand with Amendment 146, because they relate to Scotland and Wales. They relate to the fact that, under the Bill, there will have to be a memorandum of understanding between Great British Railways and the Scottish and Welsh Governments. There is a great deal of reliance on memoranda of understanding in the Bill, but we never see them and have no entitlement to do so. I am not saying that they will not be published, but I am not sure that the Government are under an obligation to publish them. They are so much a part of this Bill, but their substance is being concealed from us in Parliament and wrapped up in documents that are ancillary to the main agreement. My Amendments 145 and 146 would require those memoranda to be laid before Parliament before they could come into effect.
Finally, I have the paired Amendments 294 and 295. Again, one relates to Scotland and one to Wales. Amendment 294 relates to Clause 82. There is something fantastically cheeky in Clause 82, which reads:
“Great British Railways must consult the Scottish Ministers before making a decision within subsection (2)”—
which would be a decision about cross-border services and additions to a part of the railway network operated by Great British Railways that is situated in Scotland—
“if it appears to Great British Railways that the decision will significantly affect the interests of Scotland’s economy or of persons living in, working in or visiting”
the area. I come back to a similar question I asked in the last group: what economic capacity would Great British Railways be employing to make disinterested decisions about whether something would have a significant effect on the interests of Scotland’s economy? Secondly, is it not more likely that the Scottish Government would be the appropriate body to make a decision about whether something will have a significant effect on the interests of the Scottish economy? My amendment would put that right by reversing it. Amendment 295 would do something similar for Wales.
There is a certain arrogance in the Bill, certainly with regard to local government in England, but the arrogance towards the Scottish and Welsh Governments is beyond the pale, given what the Prime Minister has been saying and what those Governments would accept. I hope that, when the Minister replies, he will say that the matters to which I have drawn attention are slips in the drafting that he will be happy to correct, either through my amendments or amendments that he will draft and submit to us on Report. I beg to move.
Lord Lansley (Con)
My Lords, I want to talk to my Amendment 22 in this group. Before I do that, I might just say so to my noble friend that I see the point he is driving at with Amendment 21, but I think it is a little more complicated. It seems to me that this is about the circumstances that apply where the Scottish or Welsh Ministers wish to use Great British Railways or a company jointly owned by themselves and Great British Railways. In effect, they are not subsidiaries of Great British Railways: we can already see in the Bill this distinction between GBR companies and a company that is jointly owned by Scottish and Welsh Ministers and GBR.
They can use that to provide services but, as far as I can see, they are not prevented from doing the following. If you look at subsequent clauses, we have seen the whole process of designation of passenger services, which those of us who did the public ownership Bill will remember. They have to designate passenger services with a public sector company, but the definition of a public sector company in a later clause is not the same. It could be a company wholly owned by Scottish Ministers or by Welsh Ministers; they are not required to use Great British Railways. They could even do the same thing that the Secretary of State can, which is exempt services from designation, and then do the same as the Secretary of State does with TfL but in Glasgow, Cardiff and so on. So I think it is a little more complicated.
In particular, I think putting “other body corporate” in here is not necessary. More to the point, if I may say so to my noble friend, is to re-enter the question of the scope of who might provide designated services, which I know he will do with further amendments at a later stage.
Amendment 22, on my part, is just to see whether there is really a problem. At the point at which Scottish and Welsh Ministers look to change arrangements that they have made with Great British Railways to provide some services, they are required to consult with the Secretary of State and Great British Railways. However, those arrangements will necessarily lead to issues that need to be governed by the regulatory functions of the Office of Rail and Road and relate to the licensing of those operators through the ORR. It seems to me perfectly reasonable to require that Scottish and Welsh Ministers, at the point of making or changing those arrangements, should also consult the Office of Rail and Road in order to ensure that there is not a difficulty associated with what they are asking GBR to do on their behalf. The purpose of Amendment 22 is to put in that consultation with the ORR.
Lord Hendy of Richmond Hill (Lab)
The noble Lord draws my attention to something which, having read it to him, I concluded myself. This is the purpose of Committee, of course: to discover things that you have not thought about. I am as willing as the next Minister, perhaps, to decide what to do. We will take that away, and I am grateful to the noble Lord. For the avoidance of doubt, I still do not accept the contention about the connections between the MoU and the strategies, but I accept the points that the respective boundaries of the strategies could be much better placed than they are.
Amendment 146 from the noble Lord, Lord Moylan, goes further on the provisions on the allocation of ticket revenue from cross-border services operated by Transport for Wales. We do not think that is appropriate. Such operational and commercial matters are more appropriately dealt with through established industry arrangements such as public service contracts and the Wales and borders agreements rather than through an intergovernmental co-operation agreement, which is fundamentally about the governance of GBR, so I urge the noble Lord not to press the amendment.
I turn to Amendments 294 and 295 on consultation. The Government fully recognise the importance of ensuring that Scottish and Welsh Ministers are consulted on decisions that have a significant impact on their nations. That is precisely why the Bill already places a duty on GBR to consult them before making such decisions. The amendment would go further by requiring devolved Ministers to determine whether consultation was required. That would add significant delay for no practical benefit, as Scottish and Welsh Ministers would be required to review decisions that would often be irrelevant to them before steps can be taken. The approach could create uncertainty about when decisions can proceed and risk shifting the focus from effective engagement to procedural questions about whether consultation is required. Scottish and Welsh Ministers will also continue to have important mechanisms through which they can influence the railway, including their respective rail and transport strategies, their powers, which are strong, and guidance. The Government therefore consider these amendments unnecessary.
Finally, Amendment 296 from the noble Lord, Lord Berkeley, specifies that GBR should consult on access decisions where they impact Welsh Ministers. Clause 82 already requires that GBR consults Wales on issues affecting it. That requirement would also extend to access decisions. Therefore, I can reassure the noble Lord that his intent has already been achieved by the Bill but, bearing in mind what he said in support of his amendment, I will write to him, and copy it to other noble Lords, about the ownership and control of infrastructure in Scotland and Wales now and in the future so that he and other noble Lords—though I see the noble Lord is not in his place—can be clear about the present and future arrangements, since I think what he said expressed a degree of confusion about them.
I finish by saying again, as I started with, that Scotland and Wales have been intensely involved in the drafting of the Bill and that both Governments are very supportive of it. Therefore, I urge the noble Lord to withdraw his amendment.
Lord Moylan (Con)
My Lords, we see a pattern—there is always an argument as to why the bear in the front room should be able to make the decisions without constraint, and here we go with Scotland and Wales. If the Minister tells me that Scottish and Welsh Ministers are happy that Great British Railways, a largely unaccountable body that is largely concerned with English railways, should make a determination as to what is of economic significance to Scotland and Wales, and that they have had that question put to them, considered it squarely and come back and said “Yes”, then of course that is what the Bill should say. It strikes me as odd and not consistent with the general approach that the Scottish and Welsh Governments would take to these things. Beyond that, I congratulate my noble friend Lord Harper on drawing out various points. I feel a swathe of government amendments coming on Report.
Lord Moylan (Con)
I think there will have to be others as well. None the less, for the moment, I have done my best to defend the devolution settlement, keep up the policy of the Prime Minister and give Scotland and Wales a say over the future of their own economies in so far as they are affected by public transport. Having done that, I will subside and beg leave to withdraw my amendment.