Maria Eagle
Main Page: Maria Eagle (Labour - Liverpool Garston)Department Debates - View all Maria Eagle's debates with the Department for Transport
(12 years, 10 months ago)
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Maria Eagle (Garston and Halewood) (Lab)
I beg to move,
That this House believes that the scale of increases to rail and bus fares and the high cost of fuel are significantly increasing the transport sector’s contribution to the cost of living crisis facing households up and down the UK; notes that, despite the Chancellor’s announcement in his Autumn Statement that rail fares would rise this month by 1 per cent. above inflation, many commuters have found their tickets have gone up by as much as 11 per cent.; recognises that this is a direct result of the decision to give back to train companies the right to add a further increase of up to 5 per cent., resulting in the cost of getting to work rising to more than the cost of monthly mortgage or rent payments for many families; notes with concern the National Audit Office’s warning to the Department for Transport that higher rail fares are likely to lead to higher profits for train operating companies; deplores the Government’s decision to levy even higher increases of 3 per cent. above inflation for 2013 and 2014; and calls on the Government to end the right of train companies to increase regulated tickets by more than the cap set by Ministers, so as to prevent fare increases of up to 13 per cent. that could otherwise hit passengers in each of the next two years.
This has not been a happy new year for many commuters. Having been promised by the Chancellor in his autumn statement that he was keeping increases in rail fares at just 1% above inflation, many had a nasty shock as they returned to work last week—not fare rises of 1% above inflation, but increases of up to almost 11%. Season tickets between Chester and Crewe are up by 10.6% on a year ago, and tickets between Llandudno and Bangor hiked by the same double-digit increase, 10.6%. Return tickets are also up—Exeter to London, for example, up by 9.6%, Cardiff to London by 9.7% and Plymouth to London by 9.7%.
But what did the Chancellor tell the House in November? He said:
“RPI plus 3% is too much. The Government will fund a reduction in the increase to RPI plus 1%. This will apply across national rail regulated fares, across the London tube and on London buses. It will help the millions of people who use our trains.”—[Official Report, 29 November 2011; Vol. 536, c. 810.]
He was right—it would have done, except that the Chancellor forgot to say that his Government had quietly given back to train companies the right to add up to another 5% on fares, provided the increases averaged out at the cap that he had set, giving the train companies back the right to fiddle the fares.
Mr John Redwood (Wokingham) (Con)
Given that we all would like lower rail fares, does the hon. Lady think that there should be a bigger Treasury subsidy out of taxpayers’ pockets in order to achieve that?
Maria Eagle
Our position is that we would have continued in this Parliament, as we did in 2009, to put a stop to the power train operating companies have to fiddle the fares—
Maria Eagle
If the hon. Gentleman will allow me to finish answering the last intervention, I might get around to giving way to him. As the previous Labour Transport Secretary made clear, we would not have given back to train operating companies the power to fiddle the fares by hiking them by more than the cap on the most profitable routes and getting away with it by introducing much lower increases on the routes that do not rake in the cash. That is something we put a stop to in government once times got tough.
The Minister of State, Department for Transport (Mrs Theresa Villiers)
Will the hon. Lady give way?
Maria Eagle
I will give way to the Minister, who I expect will be winding up the debate, and then to my hon. Friend.
Mrs Villiers
The hon. Lady claims that Lord Adonis, a previous Transport Minister, would have continued the suspension of the fares basket, but the reality is that he did not renegotiate that with the train operators; he negotiated for a one-year contractual suspension. If he had intended to carry on with that, he would have negotiated the period into the franchises, but he chose not to.
Maria Eagle
The right hon. Lady is wrong to say that there was no intention to continue with that. She can try to rewrite our policy as much as she wishes, but my noble Friend Lord Adonis made it perfectly clear in oral and written evidence to the Transport Committee that the ban on flex would continue into subsequent years, and that remains our policy.
Andrew Gwynne
My hon. Friend is right to point out that it was the previous Labour Government who got rid of train operating companies’ ability to fiddle the fares. Was she as astounded as I was at the lack of knowledge displayed earlier by the Prime Minister, who did not even know that it was his Government who had reinstated the right for those companies to clobber hard-working commuters?
Maria Eagle
I must say that I was quite surprised that the Prime Minister did not seem to have that information. It was only after my right hon. Friend the Leader of the Opposition had asked him three times that the Prime Minister managed to claw his way towards an accurate answer, but that is what we have come to expect from him.
Dr Julian Huppert (Cambridge) (LD)
While we are discussing the rewriting of policies, what message would the hon. Lady give to a previous Transport Secretary who in 2007 allowed Stagecoach South West to raise fares by 20%, or indeed to the Transport Secretaries who allowed that to happen in the 10 years before that? Does she agree that that was a huge mistake and that fares went too high?
Maria Eagle
If the hon. Gentleman will wait, I will move on to say a little more about our current policy thinking later in my speech.
Mr David Evennett (Bexleyheath and Crayford) (Con)
Will the hon. Lady give way?
Maria Eagle
I will give way, but then I must make some progress, because the debate already has to be shorter than we had hoped.
Mr Evennett
I am extremely grateful to the hon. Lady and am listening to her with great interest, but she is attempting to rewrite history. Does she feel any guilt about the huge fare increases that took place under the Labour Government, because commuters in my constituency had a really rough time?
Maria Eagle
The reality is that when the previous Government saw what train operating companies were doing with the power that flex gave them to game the system and clobber some commuters far more than others, we banned it. This Government have reintroduced it. Times are still tough and the Government should not have caved in to pressure from train companies, but they seem to be unwilling, or perhaps incapable, of standing up to vested interests on behalf of commuters, who are now paying the price. I have made it clear that we would have strictly enforced the 1% above inflation cap and not allowed the increases of up to 11% that commuters have faced at ticket offices since the new year.
The Secretary of State for Transport (Justine Greening)
Perhaps the hon. Lady would like to finish the other part of her phrase, which is that she would not have allowed rises of above RPI plus 1%, just as she would not have allowed below RPI plus 1% flexibility. Will she confirm that that is the position and that many commuters would face fare increases under her proposals?
Maria Eagle
What we are not seeing from train operating companies or the Government are proposals to reduce fares. The technical position is of course that if an average cap is applied to each fare, the fare rise will apply to each fare. The Secretary of State is right about that, technically speaking.
Ms Karen Buck (Westminster North) (Lab)
On the commitment to reduce fares, is my hon. Friend aware that the Labour candidate to be Mayor of London intends to bring forward a package to reduce fares, given that Boris Johnson’s increase in the cost of a zones 1 to 4 travelcard equals a 21% rise, despite the fact that Transport for London has a £729 million operating surplus? The Labour party has a commitment to cut fares.
Maria Eagle
I am aware of that and thank my hon. Friend for making that point. At least Labour’s candidate understands how hard it is for ordinary, hard-pressed commuters to afford the kind of fare rises that the Government are not only allowing, but promoting. It is no good Ministers hiding behind the deficit, because this is not a simple case of bringing additional money into the Treasury; it is also about bringing additional money into the profits of private train companies. The National Audit Office report on the Department for Transport’s spending settlement warned:
“There is a risk that the benefit of the resulting increase in passenger revenues will not be passed on to taxpayers fully, but will also result in increased train operating company profits.”
High fares equal increased profits in an industry that relies on subsidies of more than £4 billion of taxpayers’ money every year. It is no wonder passengers in Britain are paying three and a half times more for their rail tickets than those in France, Germany and Holland, all countries that do not have the costly and fragmented rail industry structure that is the legacy of the Tories’ botched privatisation of our railway industry. The French, German and Dutch state railways are so successful that they are now bidding for and winning franchises to run rail services in Britain. The Government are step by step nationalising our rail services—it is just that it is not our nation. The profits will be helping to keep down fares in France, Germany and Holland for their own domestic passengers. It is no wonder that fares are so high under our broken system.
Therefore, we would enforce a strict cap on fare rises, but I believe that we need to go further and make fares fairer. Because the system has lost all credibility, passengers feel ripped off and know that they are being ripped off. They feel that the system does not work in their interests and that it is designed to catch them out. That is what I have been told by passengers as I have travelled across the country over the past year. In addition to getting spiralling rail fares under control, here are five other ideas that passengers have said would make a real difference. First, why is there no single national definition of peak time? Why are train companies allowed to set different rules so that passengers have to know precisely which company they are travelling with or risk facing a fine for travelling on the right ticket at the wrong time? Why are the companies allowed to chop and change peak time, stretching it out simply to hike their profits?
Maria Eagle
I have already given way to the right hon. Lady and to the hon. Gentleman, so I will make some progress in my speech. At the very least, rail passengers would like tickets to state clearly the precise time restrictions that apply instead of simply being referred to some obscure part of a website that they do not have access to when purchasing a ticket.
Paul Maynard (Blackpool North and Cleveleys) (Con)
Will the hon. Lady give way?
Maria Eagle
I want to make a few points about what I have heard from passengers and will try to give way to the hon. Gentleman later.
Secondly, passengers want a legal right to be offered the cheapest ticket for the journey they wish to make, and they do not think that it is too much to ask that the cheapest fare must be clearly advertised. Should passengers not be entitled to a refund if they have not been sold the cheapest ticket?
Under this Government, it is to become harder to buy the cheapest ticket if plans to replace staff with machines and close all 675 category E station ticket offices are implemented, yet that is what Ministers are considering, along with cutting the opening hours of 302 category D station ticket offices. All the evidence suggests that many people are not sold the cheapest ticket when they buy a ticket online or from a machine.
Thirdly, passengers have told us that they want the cheapest fares to be available wherever tickets are sold, yet the cheapest fares often appear to be available only online. Should not the same fare structure apply to tickets purchased at train stations and other outlets as applies to those bought online, ending the digital divide that is arising and increasing costs for older passengers, in particular?
Fourthly, what really annoys rail users is when they make a genuine mistake or are forced to change their travel plans but find themselves treated as a common criminal in front of other passengers and required to get out their cheque book and cough up. Of course we have to protect revenue, but we also have to have some common sense. Within the same period of the day, there has to be greater flexibility to vary plans, even on pre-booked tickets. Trains are not airlines, and we do not wish to go down the road of airline-style ticketing, with no cheap walk-on option.
Finally, passengers told us—
Maria Eagle
If the hon. Gentleman will just let me get to the end of my points, I may give way to him.
Finally, passengers told us that they understand that sometimes a track has to close, such as for essential work, to keep our railways safe, but when a rail replacement service makes their journey longer, often adding considerable inconvenience, they want to know why their ticket costs the same. They can apply for a discount if their train is delayed, but not if it turns out not even to be a train and ends up being a bus.
Those are all ideas that we are looking at seriously, because for too long Governments have let the train companies get away with treating passengers in a way that would not be permitted in other industries.
Paul Maynard
Is the hon. Lady seriously arguing that peak hours on the west coast main line should be the same as those on Merseytravel lines?
Maria Eagle
I am arguing that it is important to have a national understanding of peak hours, so that passengers are not clobbered and do not have to wait until what seems like a long time after normal peak hours in order to get on a train home. That would be an improvement, and it would clarify the system. People would not be caught out as they frequently are, and they would not be inconvenienced by having to wait for hours after their meeting has finished in order to get on a train home.
If this Government are not going to stand up to the train companies and take on vested interests, we will. Those are all ideas that we are looking at seriously.
Maria Eagle
I said that I am going to make some progress.
For too long, Governments have let the train companies get away with treating passengers in a way that would not be permitted in other industries. The previous Transport Secretary described rail fares as eye-watering and rail services in Britain as a “rich man’s toy”, yet he failed to understand that the policies of his own Government are making the situation worse.
Maria Eagle
No.
Next year’s fare increases are set to be even higher—not 1% but 3% above inflation, with the same again in 2014. Unless the Government are willing to stand up to the train companies, and unless they are willing to take on the vested interests and remove the right to add another increase of up to another 5% on top of this year’s so-called cap, commuters next year will face fare rises of up to 13%, with another 13% the year after. That is happening at a time when average incomes are plummeting. Over three years, some tickets will rise by almost one third as people’s real incomes fall by 7.5%, yet the Government seem completely out of touch with the impact of that on households.
Season tickets are heading rapidly towards £10,000 a year on some routes into London once underground travel is included; families are now paying more on commuting costs than on the mortgage or rent; and ticket price rises are outstripping wage increases several times over, if people are fortunate to see a wage increase at all. That is the cost-of-living-crisis facing households throughout the country. Rent levels are going up; energy and water bills are rising relentlessly; bank charges are extortionate, as the cost of living means overdraft limits are breached; and the cost of transport is rising.
Justine Greening
I am listening very carefully to the hon. Lady, who is raising what we all recognise as important issues, but I want to double check something, because earlier in her speech she talked about getting more money into Government coffers through the RPI plus 5% flexible policy. Does she recognise that the policy she is announcing today is a spending commitment? If so, how does she set it against what her shadow Chancellor said yesterday, when he stated:
“I can say to you unequivocally we can make no commitments to reverse any of the Government’s tax rises or spending cuts”?
Maria Eagle
I do not know the spending commitment to which the Secretary of State says I have referred, because there is no spending commitment, and it is complete nonsense for her to say that there is —[Interruption.] I understand her point, but if she wishes to try again I will give way.
Justine Greening
Clearly, the money for that policy has to come from somewhere, and it is from the taxpayer. The hon. Lady obviously accepts that point, so the policy is a spending commitment. Will she simply confirm the reality of that?
Maria Eagle
What I have said is that we would stop the operation of the flex system, as the Secretary of State’s Labour predecessor did. We said before the election that we would do so, but the Government have reversed that policy, and commuters are being clobbered as a result. That is quite clear.
Maria Eagle
No. This is a shortened debate, and I want to give people time to make their speeches, so I hope that the hon. Gentleman will forgive me if I make some progress. I have already spoken for a little longer than I would have hoped, and that is partly because I have taken interventions.
The Government need to be tougher not just on train companies, but on private bus operators. While train fares grab the headlines, most people’s experience of transport is in fact the local bus. For many, the bus is a lifeline: for those without a car; for older people who no longer drive or may never have done so; and for our young people, for whom the bus is their only way to get around, especially if mum or dad do not have a car or work all hours. Yet quietly, and without much fanfare, throughout the country there is a catastrophe facing bus services, with services being cut and fares rising. Again, that is thanks to decisions made by the Government. Their unwillingness to take on the vested interests in our transport industry is holding back the reform that is required.
In the spending review, the Government have made three decisions that have hit bus services. First, they have cut councils’ local transport funding by 28%—and front-loaded it. that has meant the end of support for many subsidised routes, and the end of ring-fencing has placed further pressure on councils—[Interruption.]
Madam Deputy Speaker (Dawn Primarolo)
Order. It really is not necessary for the Secretary of State to keep shouting across the Dispatch Box. She is about to address the House, and I am sure that she expects everybody to listen to her as well.
While I am on my feet, I must say that increasingly in the Chamber there is the behaviour whereby Members shout and heckle constantly when somebody else is speaking, and it is not really acceptable, so I hope that Members will stop it.
Maria Eagle
The end of ring-fencing has placed further pressure on councils to divert funds from bus services in order to protect other front-line services such as Sure Start or social care budgets.
The Government’s second decision has been to cut the funding available to bus companies in order to reclaim some of their fuel costs, particularly in rural areas where otherwise they would simply not run the service. Thirdly, the Government have changed the formula by which local authorities are reimbursed for the cost of delivering the concessionary fares scheme for older people, leaving councils with a funding shortfall that has led to new restrictions on when passes can be used, and to cuts in services.
On the impact, the Campaign for Better Transport calculates that one fifth of supported bus services throughout England now face the axe; more than 1,000 bus services have already been lost; and many surviving routes have seen fares hiked significantly.
The Public Transport Executive Group, which represents all the passenger transport executives, serving 11 million people throughout the metropolitan areas of England, calculates that as a result of the Government’s policies bus usage and patronage will decline by 20%, fares will increase by 24% above the rate of inflation and the added congestion alone will cost £68 million.
Ministers fail to understand that, when they cut a bus route, they cut an opportunity for young people to stay on in education, for people to travel further afield to take up employment, and for older people to remain connected to family and friends, with all the quality of life and, even, mental health benefits that that can bring. That impacts not only on those who rely on their local bus services, but on our ability to reduce the deficit. When those who want to travel further to take up work find that they cannot afford to do so or that the bus service is no longer there, those opportunities simply cannot be taken up. Young people who get the grades that they need to give them a chance in life and to find a good job will find that they simply cannot get to where they want to go for work or to continue their education.
The Government have said that those who are out of work should be willing to travel for up to 90 minutes to take up a reasonable job offer or else lose their jobseeker’s allowance. However, they are also taking away the only affordable means for people to do so. That is a total failure of joined-up government.
The Government are telling young people to stay on in education post-16, yet they have not only axed the education maintenance allowance, but failed to protect the local bus services that enable young people to get to college. The scale of the cuts faced by councils is leading to restrictions on concessionary fare schemes for young people. Some councils are telling us that they may have to axe schemes altogether. It is no wonder that the UK Youth Parliament chose to debate the need for cheaper fares and more accessible public transport for all young people during its annual sitting in this Chamber, following a vote by 65,000 people across the country.
The Association of Colleges has warned of a drop in further education enrolment and 60% of colleges have reported a drop in transport spending by their local authority. On average, students travel between 9 and 35 miles to get to college, with 72% of them relying on the bus to get there. That is another total failure of joined-up government. The consequence will be added pressures on family budgets or young people simply being unable to take up the opportunities that they need to reach their potential. That is a tragic waste for those young people. It is an idiotic policy because it will lead to higher welfare costs and less tax take in the future. It is a knee-jerk cut that will make it harder to reduce the deficit.
Cuts to school transport support for younger pupils are adding to the burden on families, with parents struggling to afford the fuel costs of the school run or having to juggle getting children to school with getting to work. Figures obtained by the Campaign for Better Transport show that council spending cuts have led to almost three quarters of local education authorities making cuts to school transport.
The loss of bus services has also had a devastating impact on older people. Despite the Prime Minister’s election pledge on the free bus pass that we introduced in government, he has axed £223 million from the scheme in this year alone. That has an impact on the viability of many bus services. Do not take my word for it; Tory-controlled Norfolk county council is leading the campaign for fair funding from the Government for concessionary fares. It has support from councils in Cumbria, Somerset and Devon, all of which have Tory leaders. Norfolk alone has calculated a £4.5 million shortfall in funding for the concessionary bus scheme. Up and down the country, pensioners are asking what is the point of a free bus pass if there is no bus. The Prime Minister has failed to honour the spirit of his election pledge and has left many older people isolated.
Maria Eagle
I hope that the hon. Gentleman will forgive me, but I have given way to him once and I need to conclude.
The issue is not only about the level of spending; we need the proper regulation of bus services, not least when they rely on public subsidy. Having made these cuts, the Government are powerless to influence bus fares or to protect bus services because they are unwilling to stand up to the private bus operators and to take on the failure of bus deregulation outside London. In London, we have control over fare levels and we can regulate bus routes, or we could if we had a Mayor of London who was not choosing to let bus fares spiral out of control. It is time to consider the right way to reverse bus deregulation across England. We should give new powers to local communities to deliver bus services in the way that best suits them.
Maria Eagle
I am coming to a conclusion so I will not.
Whether it is the increase in rail and bus fares or the rise in the cost of fuel, this Government are allowing the costs of transport to spiral, adding to the cost-of-living pressures faced by families. The Government have failed to tackle those increases not because of the deficit, but because they are unwilling to stand up to vested interests. They are failing to stand up to the train companies, letting train fares rocket by up to 11%. They are failing to stand up to the bus companies and to look at the best way to re-regulate the industry outside London. They are failing to stand up to the banks and impose a bonus tax, adding to the high cost of fuel. As a result there are rising transport costs, which are adding to the pressure on households up and down the country. This Government are too out of touch to do anything about it.
Maria Eagle
Given that the Secretary of State has said that she is interested in reducing the costs of the railway industry, does she accept that she needs to examine its structure? One of the big causes of excess cost in the industry is the fragmentation that was left to us after the botched privatisation that the previous Tory Government carried out.
Justine Greening
I think many people watching the debate will wonder why the hon. Lady’s party did nothing in 13 years. I will shortly publish a Command Paper setting out our approach to tackling a number of the broad challenges that exist.
Justine Greening
My hon. Friend is right to set out the very difficult balance that we have to strike. On one hand we have to ensure that we keep rail fares affordable, and I am determined to do what I can to do that in spite of the fiscal straitjacket within which the Government are having to operate. On the other hand, we have to ensure that we can balance investment in the short term. I am sure that many Members were delighted to see Bombardier agree the contract with Southern for more carriages, and we are putting unprecedented investment into the existing railway lines. We have to strike a balance between working out who pays for the hard work that is going on today and ensuring that we have a railway network that is fit for service in the future.
I know that some passengers on particular routes have faced higher increases than others, and I listened to what the hon. Member for Garston and Halewood said about the 5% flex in rail fares. I am bound to point out, however, that it was the last Labour Government who introduced that flex in 2004.
Maria Eagle
I accept that it was introduced by the Labour Government, but it was then stopped by the Labour Government and reintroduced by the current Government.
Andrew Jones (Harrogate and Knaresborough) (Con)
It was stopped for one year.
Justine Greening
I am pleased that the hon. Lady has made that intervention, because I have with me an exact extract from the franchise agreement that the last Labour Transport Secretary put in place. I shall quote from it, to remove any uncertainty, and then maybe the hon. Lady would like to intervene on me again. It states:
“With effect from 1 January 2010, Schedule 5 of the Franchise Agreement will be amended as set out in the Appendix to this notice.”
That is the change that she has talked about. However, it continues:
“On and from 1 January 2011, the amendment to the Franchise Agreement set out in this notice of amendment shall be reversed.”
Does she want to intervene to correct the record?
Maria Eagle
I am very happy to intervene. Of course I will not contradict what the legal agreement states, but the last Labour Transport Secretary made it perfectly clear to the Transport Select Committee in 2009, in oral and written evidence, that the policy was to continue. It had not been negotiated, but that is different from the policy having been changed. Negotiations go on all the time in government, as the Secretary of State will be finding out. I do not think that quotation makes the point that she thinks it does.
Justine Greening
I really suggest that the hon. Lady stops digging the last Labour Transport Secretary into a deeper hole than he is already in. The contract is absolutely clear-cut, stating categorically in black and white that the flexibility levels introduced by her party’s Government would be reintroduced the year after their abolition.