Rail Infrastructure Investment

Ruth Cadbury Excerpts

Thursday 17th January 2019 Westminster Hall

[Ruth Cadbury (Brentford and Isleworth) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Evans. I am a new member of the Select Committee on Transport, and did not serve on that Committee while this inquiry was under way; nevertheless, it raises a number of points that I want to speak about. I am also pleased to have been able to join the Transport Committee, particularly under the chairmanship of my hon. Friend the Member for Nottingham South (Lilian Greenwood). I have found her to be supportive, enthusiastic and knowledgeable, and she has made me feel welcome in that Committee in the few weeks that I have been a member, as have the Committee’s other members.

Many people in this country are dependent on rail services, and when there are problems, our constituents really tell us about them. Rail travel is essential for those who are unable to drive or do not own a car for whatever reason, and for people such as me who are dependent on rail for their commute to work and for whom there is no alternative, especially when car commuting would take much longer or be too costly. Since the advent of mobile technology, the train journey means more productive working time for those required to travel long distances, or even for me on my half-hour rail commute, than driving does. One can also use the journey as an opportunity to catch up on sleep—another option that is not available when one is driving. Then, there are tourists: UK and overseas residents letting the train take the strain. For all those people and many more, good train services really matter.

It is not just about the quality of services; it is about price. The real cost of rail travel continues to rise year on year. The real cost of driving has flatlined or even fallen, but UK commuters are paying about 17% of their average wage for their season ticket—by far the highest in Europe—and the cost of rail travel continues to rise.

Rail services that are reliable, convenient, fast over long distances, affordable, comfortable and safe benefit not only passengers but the places they link up, providing more business investment, more residents—particularly in areas of declining population—and, in many places, more tourist spend.

More people travelling by rail reduces the number of cars on the roads. That then reduces congestion and associated air pollution. Walking or cycling to a station improves a person’s health, and they may be more likely to spend money during that short journey than if they were driving their own private car. Rail improvement, and investment in rail, benefits people and places.

As a London MP, I concur with colleagues’ anger at the disparity between transport infrastructure investment in London and in the other regions of the country. Why does that disparity exist? I accept that the way that the calculations are done exacerbates the inequality, but frankly that is a tool of a lack of policy. The disparity is a reaction to what always happens in mature economies when there is no effective regional economic policy: the inevitable growth of population and jobs in the largest city.

The main justification for investment in Crossrail, and the longer trains and platform extensions in other rail services in and around London, is that it is a reaction to population growth in and around London. Any economist will say that unless a country has an effective, long-term regional policy, there will be an increasing suck of investment and people towards the capital.

Against that, in some outlying areas in further regions—particularly, as a colleague said yesterday in Prime Minister’s questions, in the north-east—there are some ex-colliery towns where houses are lying empty. An effective regional policy would address that imbalance, which disadvantages both types of area.

The lack of regional policy, and continuous sucking into London of people and investment without any rebalancing, means that in the capital housing is overcrowded and prices are exorbitant—way beyond our children’s ability to rent, let alone buy their own homes. Of course, there is also overcrowding in our transport system.

[Graham Stringer]

I am grateful to my hon. Friend, as a London-based MP, for her support for a sane, sensible and fair regional policy. Does she agree that not only is the unfairness a factor, but that repeated investment in London to solve transport problems is counterproductive? Investment in transport has an economic effect: it creates more jobs, more people and more pressure on housing. Investing in that way is therefore effectively investing in future congestion.

[Ruth Cadbury]

I absolutely agree. That is the other side of the coin, and it can be addressed only by a proper, serious regional policy. Since 2010, the Government have moved far away from the regional policies that we had, completely decimating the regional economic development boards, and so forth.

The only nod to a regional policy that we have had in recent years is the northern powerhouse. I have heard again and again what a token gesture the northern powerhouse has been. Even the original promises have gradually been whittled away. We have nothing more than tokenism on regional policy in this country at the moment. As the Transport Committee Chair said in the report, regional transport authorities say that

“systems of scheme appraisal currently work against regions”.

In a sense, the state is exacerbating the natural pressure that always occurs without any sort of state intervention.

Market-led proposals are inadequate to deliver new projects—we see that failure around Heathrow airport. The roads around Heathrow airport, and I do not just mean in west London, but across the Thames valley, Buckinghamshire, from Surrey almost to Hertfordshire, and in the whole sub-region surrounding Heathrow airport, have some of the worst traffic in the world. The roads are dangerously overcrowded, with levels of pollution that are illegal, because we increasingly recognise air pollution as a serious health hazard. It is an economic brake on not only businesses that service Heathrow airport but the wider west London and Thames valley region. Unnecessary congestion helps no one.

In 2001, the planning inspector for the Heathrow terminal 5 inquiry said that additional rail capacity was needed. Subsequently, in the run-up to the investigation into whether there was a justification for runway 3 at Heathrow, the national policy statement said that expansion would require 50% of passengers to use public transport by 2030, rising to 55% by 2040, and 25% fewer staff car trips to work by 2030, rising to 50% fewer by 2040.

The airport policy statement said that the Government expected Heathrow to meet its public pledge to have “no greater” airport-related road traffic. Of course, since then Heathrow airport has said that it wants to double its amount of cargo traffic, yet it has not provided any explanation. If that is not additional pressure on already dangerously overcrowded motorways down to local roads I do not know what is.

Heathrow airport has made it clear that it will not fund additional rail infrastructure, except for possibly a platform or something. Network Rail says:

“Existing connectivity to Heathrow Airport from the south is currently poor, with most people choosing to drive or get a taxi.”

When we were dealing with the implications of a fifth terminal when I was on Hounslow Council we looked, with a range of economic organisations around Heathrow and local authorities, at a scheme to bring in rail from the south and south-west called Airtrack. Meanwhile, colleagues to the west of Heathrow, particularly in Reading, Slough and so on, were looking at a new western rail extension, with the support of the Department for Transport.

Certainly the link from the west was going well, and was a stage ahead of the southern rail access, but last year or the year before everything ground to a halt as the Department for Transport announced that it wanted to let the private sector lead. As the Transport Committee has said, that has just not delivered. We have had a six-month or a year’s hiatus on the rail infrastructure that is needed in and around Heathrow, yet nothing is happening because the private sector—quite understandably—expects the Government to direct those new roads.

Now, the Government are not going to pay for it, and Heathrow is not going to pay for it. Who is, apart from the businesses and people who depend on a smooth-running road system—and the passengers, of course, who will miss their planes because they are stuck in traffic jams? Before the Minister says, “Oh, stop worrying—we are getting Crossrail and HS2 and so on,” let me remind him that Crossrail and the improvements on the Piccadilly line are to deal with existing transport pressures and the existing population increase in west London and the Thames valley. In terms of runway 3, the modal shift of Heathrow passengers on to existing and imminent transport methods will actually be very small. The Minister will know that if he has looked at the documents that were considered by the Transport Committee in its inquiry on the airports national policy statement. We are in a complete mess with rail investment in and around Heathrow, notwithstanding the fact that expansion at Heathrow —as, again, the Department for Transport’s own reports say—actually damages other regions’ connectivity with international destinations and their businesses and customers.

I want to move on briefly to my concern about the Department for Transport’s interference in transport in London. As anybody knows, and as most other major competitive cities do, a very large conurbation needs to be able to link up public transport, walking and cycling under a single management. I think the Government recognise that. Several Mayors, including the Mayor of the Greater Manchester region and others, have said that there should be greater devolution and control over rail policy, and so has every Mayor of London. But in London, and London alone, the Transport Secretary has openly said that he would block devolution of rail policy purely because he did not want a Labour Mayor to have control over it. He implied that if there were another Conservative Mayor after the first Conservative Mayor of London, he might have considered handing over rail responsibilities, but he was not prepared to do so. That blocking of devolution was so shocking that even the hon. Member for Bromley and Chislehurst (Robert Neill) said that the Transport Secretary was not fit to hold office. We have real concerns that where there are opportunities to use imaginative forms of additional investment in rail in London, that option is currently blocked to London and Londoners, and to London’s economy and that of the wider area.

I have touched on regional policy and the particular situation in London and at Heathrow. In my view, transport policy, of which rail is a part, should be a servant, not a driver, of other policies. I may be going beyond the remit of the report today, but it strikes me that we cannot discuss regional imbalance in rail infrastructure, or whether the decision making is at a local or national level, or whether the cost falls on the private sector investor or the passenger, without addressing the overarching issue of Government investment in the transport infrastructure, and rail in particular.

Is the funding from Government for such an important driver of the national economy and the environment enough, or even comparable with other equivalent economies? I suspect it is not, and I definitely think it is not enough. Are passengers paying too much of the cost of running rail? I believe they are. An efficient, affordable, reliable rail service drives economic growth and regeneration, cuts carbon and pollution emissions and enhances the international image of a country.

--- Later in debate ---

[Andrew Jones]

I understand the hon. Gentleman’s point, and if that were the only consideration I can see how it could lead to inappropriate decisions, but that is not entirely the case. For example, the transpennine rail upgrade, which will be the biggest enhancement on our network over the next five years, would simply not be happening if we accepted his point. But I understand where he is coming from: we have to balance not only economic return and national efficiency, but the possible role in rebalancing our national geography. The lack of investment in some parts could easily be seen as a factor in economic performance.

Our decisions follow a rigorous and fair appraisal process that ensures spending goes to the projects and programmes where it is needed, delivering value for money for taxpayers and passengers. Sometimes that means that spending appears higher in some areas than in others. We cited various figures, but the numbers quoted are frequently from the IPPR. I have some reservations about the IPPR reporting, because it simply adds up future spending regardless of how far it extends. For example, its analysis includes 16 years of planned expenditure on HS2, where the most costly sections—because of land prices—are in London, but only five years of planned spending on maintenance for the other parts of our network. It includes locally funded spending by TfL, but not local, equivalently funded spending in other cities, which will result in a poor sample.

We look at data in a number of different ways. Investment in Birmingham, for example, could benefit users in Penzance, Edinburgh—anywhere across our network—and, of course, the west midlands. We look at two measures: where the investment is made and where the benefits will be felt. The numbers quoted so far on where spending is taking place largely have not taken into account where benefits are felt. However, spending figures going forward, as shown by the national infrastructure and construction pipeline, show that the Government expect to spend £248 per person in the north, compared with £236 in the south. There is an element of the phasing of schemes driving the individual spend in an area.

The rebalancing toolkit has been considered, which we have developed to support authors of strategic cases to assess how a programme or project fits with the objective of spreading growth around the country. I was asked whether it is being used. It is being used in the development of the transpennine rail upgrades and the Northern Powerhouse Rail business cases. The rebalancing toolkit is designed to help with the basic planning. It includes a checklist of questions to consider and potential evidence that can be used to help describe the rebalancing case for a project or programme in its strategic case. It is an ingredient. Does it need to be used in every single case? Given the amount of money we spend and the amount of time it takes us to plan our projects, I do not think it should be mandatory everywhere, but certainly it is an ingredient in making the right decisions. The toolkit’s objective is to make decision making more consistent by improving the focus, quality and transparency of the rebalancing evidence in the business case.

Let me answer some questions asked by colleagues. The transpennine rail upgrade offers the fantastic prospect of the north being the centrepiece of the next spending period. It is a £2.9 billion first phase of a scheme. Electrification will be a part of the proposals. It is phased to deliver the best benefits to passengers over the period. Freight will most certainly be considered; that is why we are also taking forward options for the development of the Skipton to Colne reconnection. It should be viewed as a phased activity.

The advice we have received from Network Rail is that if we spend any more money on that network during this period, with the amount of interventions required to deliver the schemes we will bring the northern rail network to a halt for just about every weekend over the next five years. We have taken the view that it would be an unacceptable price to pay, which would have a huge detrimental economic impact. We have listened to the industry experts and that is the advice they are giving us, so we are delivering this major project in phases. The criteria are about delivering the best benefits to passengers early, but our ambitions are not reduced at all.

[Ruth Cadbury]

Is it about merely measuring the benefit for the passengers? Are any other wider impacts assessed and measured, such as the impact on the environment and local areas, particularly where there are regeneration and economic development aspirations?

[Andrew Jones]

The wider considerations are taken into account. This is part of a broader plan. As the business case is created, it looks at economic benefits and environmental benefits. It is a wider case.

The hon. Member for Brentford and Isleworth asked about devolution. It is being considered as part of the Williams review, but the principle of devolution is a sound one. The suggestion that the Secretary of State is not supportive of Crossrail and the London Mayor is not correct. For example, TfL has run into some financial difficulties over the Crossrail cost overruns. We are helping it with a £2.1 billion credit facility, which it will pay back—it is a loan, not a grant. That is an important indication of how we are supportive of Crossrail and the London Mayor.