Future of Rail Manufacturing

Sam Tarry Excerpts

Tuesday 23rd April 2024 Westminster Hall

[Sam Tarry (Ilford South) (Lab)]

It is a pleasure to serve under your chairmanship, Sir Gary. I will keep my remarks short because, as my hon. Friend the Member for Easington (Grahame Morris), whom I thank for securing the debate, clearly set out and as many hon. Members have said, this affects people in constituencies across the country where thousands of jobs have already been lost across the supply chain. The basic issue is the lack of long-term orders on the books at many of the rolling stock manufacturers. The wasteful rolling stock company—ROSCO—system we have for leasing does nothing to help the industry, nor indeed the taxpayer. That money, which amounts to billions of pounds over the past few decades, could have been saved through a different leasing system and could be going back into support the industry right now.

The simple fact is that Alstom and Hitachi Rail have the lion’s share of the market between them—around 55%—so they dominate the entire sector. What happens to them is crucial for the whole long-term strategy of the industry. Their issue is that they were asked to clear their past order books so that they could commence construction for what they expected to be many years of building HS2 trains. Currently, those orders are 18 months to 24 months behind.

Previously, the Government have not taken seriously a procurement strategy that supports British jobs. In 2011, they gave away the contract for Thameslink to the German-based firm Siemens, which cost at least 1,400 jobs directly. On top of that—this is just one example that we know has already happened—it meant that there were 12,000 losses in the supply chain. We know that around 900 people are employed on temporary contracts at Hitachi Rail and Alstom. That means that even before any formal redundancy process has happened, those people—nearly 1,000 people—are very much at risk of losing their job. In fact, it has now been reported that in at least one of those firms, some formal redundancy processes are starting.

Part of what is absurd about this situation is that it was HS2 that enticed CAF, Siemens and Hitachi Rail to set up their operations here in the UK and to build manufacturing plants in communities where we thought, as many hon. Members have described, jobs would be kept for generations to come—as they should be, because rail is still the transport solution of the future, not just of the here and now. That feast and famine scenario means, however, that some manufacturers can maintain only a core of staff working as trained engineers on the production lines, with the vast majority of staff being employed part time or on agency contracts. That is not ideal. When manufacturers feel the pinch because of a lack of orders coming onstream fast enough, it is easy to remove those staff and potentially none of them will be re-employed any time soon. In fact, at Alstom, only one of the 40 manufacturing sheds remains in operation while it waits for parts from other parts of the supply chain.

Over the Easter holidays, I took my children on the Bluebell railway—the Minister will know it well. It is a fantastic heritage railway. Being on those amazing steam trains made me reflect on the fact that we are the country of Stephenson’s Rocket, the industrial revolution, the Mallard and the Flying Scotsman. We are also the country of advanced passenger technology. Ironically, a Conservative Government sold that to the Italians, and it has now been sold back to us so we can use it on the Pendolino trains that go up the west coast.

We are also the country of High Speed 1 and, in partnership with our French friends, built the first high-speed rail network under a seabed. We are a nation that has been more than capable for more than 150 years; we are the foremost rail manufacturing industrial country in the world. The Minister has within his hands—within the procurement strategy and the country’s long-term industrial strategy—the power to make Britain’s rail industry great again. I urge him and his colleagues in Government to stand up and do what is right, so that we have a proud manufacturing history in this country for my children and for the next 100 years.