Railways: East Coast Main Line

Lord Palmer Excerpts

Tuesday 4th June 2013 Lords Chamber

[Earl Attlee]

My Lords, on the noble Lord’s first question, the short answer is no. During the three years to 2012, the Treasury received £411 million and £450 million from the east coast and west coast rail franchises respectively. This is completely separate from the money that the DfT paid to Virgin Trains as part of the revenue-based risk-sharing mechanism, which by its nature is variable, so the statement that my right honourable friend made is factually accurate. The bottom line is that the plans that we have set out will drive improvements to rail services and put passengers at the heart of a revitalised rail franchising system. It is also important to remember that rail franchises are not directly comparable.

It was never intended for the east coast main line to remain in the public sector. Indeed, when the then Secretary of State, the noble Lord, Lord Adonis, explained in this House in July 2009 the decision to bring the line into public control, he said:

“I do not believe that it would be in the public interest for us to have a nationalised train operating company indefinitely”.—[Official Report, 1/7/09; col. 232.]

[Lord Palmer]

My Lords, I must declare an interest, as the House of Lords pays an enormous amount of money to get me travelling from Berwick-upon-Tweed to here, and, indeed, my family spends an awful lot of money on buying their tickets. Since the east coast service is operating remarkably successfully and is working well, why is there this desperate need and hurry to denationalise it?

[Earl Attlee]

My Lords, many noble Lords have privately approached me and said how well the east coast franchise is working under DOR. However, we need a longer-term investment plan for the future. The Brown review finds that franchising is a fundamentally sound approach for securing the passenger railway services on which so many people rely. The Government remain committed to benefiting from private sector innovation and operational experience in their railways.