Passenger Railway Services (Public Ownership) Bill

Siân Berry Excerpts

2nd reading
Monday 29th July 2024 Commons Chamber

[Siân Berry (Brighton Pavilion) (Green)]

I thank all the Members who have given their maiden speeches. It was moving to hear all of them, particularly the hon. Member for Hertford and Stortford (Josh Dean). I am making a note of everybody who mentions youth services, and he did some very good advocacy: he is on my list.

It is great to be speaking on my first Bill in the House, and that it is a Bill that brings passenger railway services back into public hands. The fact that this measure made it through the dramatic sift of Labour policy that took place before the election, and is among the first and most urgent pieces of new legislation we are looking at, is I believe in no small way due to the Secretary of State’s own commitments to this policy and her dedicated internal advocacy for it. I wish that more of her colleagues had been so willing and determined to push for similar Bills to bring other privatised services such as water and the big six energy companies into public hands, but that does not diminish my delight this evening. I recently mentioned to her how much I was looking forward to scrutinising and where necessary helping to improve other upcoming Bills under her remit, including the buses Bill and the more detailed railways Bill. This is all great work.

As far as this Bill’s key principle is concerned, the Secretary of State will have noticed that public ownership is popular with me and is popular with the people. In 2024, that principle is supported for the railways by 76% of the public. That support has risen steadily for the past decade; it was even backed before the election by 60% of those intending to vote Conservative.

Bringing the railways back into public hands has been in my party’s programme for as long as I can remember. It is also close to the hearts of my constituents in Brighton Pavilion, for whom the legacy of the failed policy of privatisation is one of poor services, inefficiencies and very high costs for passengers. An annual season ticket between Brighton and London currently costs my constituents the best part of £6,000. That cost has risen by approximately 40% in the past 10 years—far more than wages in Brighton have risen. In the face of service cuts and failure to invest, passengers have had to form local pressure groups such as the Preston Park Train Campaign to save services. In so many stations, understaffing and disabled access remain dreadful, creating appalling discrimination against passengers—and don’t get me started on toilet provision.

I am not just here to praise the Bill or celebrate its principle. I do have some questions and comments—all to be constructively taken, I hope. The Bill is very short and very simple, and I wonder whether it could benefit from some additional detail and a wider scope. I will keep my comments brief at this stage, but on each point I would welcome more detail from the Secretary of State on her thinking. I also request a meeting with her to discuss the issues before Committee of the whole House.

First, I want to talk about the exceptions from the Bill. From the information I have, it appears that the Bill will not bring into public ownership the regional services currently let by concession contracts, including the Elizabeth line, Mersey Rail and the London Overground, or any of the services on open-access routes, including Eurostar, Grand Central, Heathrow Express, Hull Trains and Lumo. For passengers, hearing the Government promise to bring private operators into public hands, but then hearing that a service they use will be excluded, will be a disappointment. I hope we will hear more soon about how those gaps will be filled.

Also out of scope, as the Bill’s title indicates, are rail freight services. The public might have expected those private operators to be among the first for action, especially as getting freight off the roads and on to rail has so many benefits in addressing road danger, congestion and climate emissions.

Another exception from this Bill to bring passenger railways back into public hands is the rolling stock companies. Quite honestly, most members of the public do not have much awareness of it, but the rolling stock in which we travel is another public asset that is worthy of public investment and should not be held merely for private rent and profit by companies that add no real value to the service. At the very least, the Bill could have included a prohibition on new arrangements of that kind.

Finally, I feel that there is a potential gap in the Government’s plans around rail devolution. The Bill’s definition of “public sector company” will allow franchises to pass only to companies wholly owned by the Secretary of State or her counterparts in Wales and Scotland, not to those owned by other elected bodies whose remit includes, or might in future include, managing transport in an integrated way within an area of the country. I am very interested in further exploring the Secretary of State’s thinking on that, because a Green principle close to my heart is subsidiarity: making sure that ownership and power are devolved to the lowest and most practical level.

In the case of integrated, multimodal transport planning and investment, particularly for day-to-day travel, the best level is often a regional or sub-regional travel-to-work area. At that level of planning, sustainable travel across different modes can be linked up in a responsive network with convenient interchanges, rational timetables and shared ticketing across modes. Profitable commuter routes on a railway might also directly help to cut car dependency in isolated villages by subsidising essential connectivity by bus, for example.

This kind of transport planning is best done alongside and in tandem with planning for new homes and businesses, for which the right scale is also a regional or sub-regional area, working with the involvement of local authorities, people and workplaces. Like many people, I am slightly concerned about the centralising tendency that we can detect in a range of recent actions from the leadership of our new Government; I hope that it will not dominate transport and planning policies in this House. If the Secretary of State agrees to meet me as requested, I will be very interested to hear more about how she expects the upcoming devolution Bill to interact with this Bill and with the future railways Bill in respect of her plans for how centralised the future planning, management and ownership of transport as a whole will be.

Admittedly, the places in England where this kind of devolution applies, and where rail franchises might sensibly pass to companies owned by cities and regions in the near future, are currently very few. However, when we have franchises serving nearby metro mayor areas, such as TransPennine Express and Northern, which are already under the wing of the Department for Transport; when the Mayor of London already has his sights firmly set on taking over specific services; and when there might, as I hope, be greater devolution of powers to combined authorities and areas in the south-east region and Sussex, where I now represent many people dependent on rail services, it does seem strange to introduce a Bill that appears to need amendment to rule in such an exciting prospect. When the Government are about to give more powers to local authorities to run buses, it also seems strange not to help them to work together to run suitable railways. Will the Secretary of State explain what plans there are to better link up railways and bus services? Will she discuss them with me before Committee?

Those are all my comments and questions. I am very much looking forward to the future, and I am looking to help build the best future we can from this new and refreshing approach of public ownership. I reiterate how pleased I am to be making such a speech, rather than one bitterly complaining about a Government who have completely the wrong idea; I hope that my questions and cautions will be taken in that spirit.

[Madam Deputy Speaker (Judith Cummins)]

I call Jon Pearce to make his maiden speech.

Passenger Railway Services (Public Ownership) Bill

Siân Berry Excerpts

Committee of the whole House
Tuesday 3rd September 2024 Commons Chamber

[Grahame Morris]

Absolutely. If ever there was a charge of political dogma to be made, it must be about the fact that, under the terms of the privatisation, the British taxpayer and the British Government are not allowed to own a stake in our own railway. For too long, private companies have provided a substandard service while making substantial profits. Over the last seven years, the remaining private train operating companies—I apologise for misleading the Committee, but I misspoke earlier when I said that there were 14 of them; there are 14 franchises in total, four of which are operated by the state through the operator of last resort—have paid out an average of £130 million annually to their shareholders. Those companies are often owned by foreign Governments —in Germany, Italy, France and across Europe and the world. Meanwhile, passengers’ day-to-day experiences have been of overcrowded carriages, delays, service failure and, worst of all, some of the highest fares in Europe.

It is worth thinking about the costs, and the profits that some private train operators have been able to generate for shareholders. Figures released just this week show that Govia Thameslink Railway paid out a staggering £82.4 million in dividends, with £62.3 million of that being for the 2023-24 financial year. That represents a 268% increase from the previous year. In return for those princely profits, Govia consistently failed to meet two thirds of its customer service quality targets, as reported in the Financial Times. The situation was encouraged to persist under the last Conservative Government. I welcome the fact that Labour is making this a priority from day one, as that is fundamental to fixing the foundations and delivering the economic growth promised by the Prime Minister.

I support the comments made by my hon. Friend the Member for Derby North (Catherine Atkinson) and the hon. Member for Moray West, Nairn and Strathspey (Graham Leadbitter) about the rolling stock companies—the so-called ROSCOs. Many commentators see a problem with the newly formed Great British Railways having to continue to lease rolling stock from ROSCOs, as that would allow those companies to profit from taxpayers’ money. My view is that ROSCOs are an unnecessary link in the chain. I frequently raised the issue with experts and industry leaders on the Transport Committee, and I believe that we would benefit from meeting our rolling stock needs by placing orders directly with UK-based manufacturers such as Alstom and Hitachi, rather than enriching the ROSCOs.

Despite being in post for a relatively short time, the Secretary of State has made a strong start with the Bill. However, I urge her to consider the points raised by me and Members on both sides of the Committee about how we continue to procure rolling stock as we move forward. On Second Reading, the Under-Secretary of State for Transport, my hon. Friend the Member for Wakefield and Rothwell (Simon Lightwood), said that purchasing existing rolling stock would not be a responsible use of taxpayers money. I understand that, but will the Minister, in responding, clarify whether in the future, under GBR, there will be an option to purchase new rolling stock directly, instead of having to continue to lease through the ROSCOs?

As my hon. Friend the Member for Derby North said, the UK needs to upgrade to 4,000 units of rolling stock over the coming decades, with Network Rail estimating costs in the tens of billions of pounds, so this is an ideal opportunity to explore a new financing model for rolling stock. I am not naive—I understand the financial situation that we have inherited from the last Government—but I ask the Government to explore not-for-profit financiers if rolling stock cannot be nationalised under GBR. May I point out respectfully that Eurofima, a supranational not-for-profit financier, has stated that, for every £1 billion of financing on UK railways, it could save the taxpayer £350 million over 30 years due to its lower financing costs? That is compared to using the existing ROSCOs. Will the Secretary of State update us on the possibility of using not-for-profit financiers for rolling stock in preference to the ROSCOs?

I will take up the point made by the shadow Secretary of State about the pay review bodies. May I point out that they are not universally welcomed? I have been looking at responses to pay review bodies in the health service, and the last Government had a less than wonderful record when it comes to implementing the recommendations of pay review bodies, not least those relating to junior doctors. The Royal College of Nursing has said of pay review bodies that there is “nothing independent about them.” The chairs and members of pay review bodies are hand-picked by the Prime Minister and Government Ministers, and the terms of reference are decided by the Government. There is some scepticism about how independent they truly are, and about whether, when they make recommendations, the Government are obliged to implement them in full.

I ask the Minister if it is possible to provide a timetable for the next steps. When will future Bills be introduced to the House, and when is Great British Railways expected to be fully established? I acknowledge and express my appreciation for the engagement of the Front-Bench team. I stress that I support the Bill because I believe that it represents a critical step in fixing the long-standing issues in our rail system. The current privatised framework is giving a fragmented railway, and has failed to deliver value for money, an efficient service or customer satisfaction. I am pleased that we are moving towards a model that prioritises the needs of passengers over the profits of shareholders. Rethinking our approach to rail management and financing is a crucial first step towards fixing the foundations and putting Great British Railways at the service of the travelling public.

[Siân Berry (Brighton Pavilion) (Green)]

The Greens are not agnostic on privatisation. We very much support the principle of the Bill and look forward to its progress. I want to make a short speech on amendments 2 to 5, which I tabled. They are very simple and common sense; their goal is to leave open the opportunity for elected devolved bodies to set up companies that they own, in order to bid to run railway services under the overall guidance and wing of Great British Railways. The Bill, which restricts the definition of a public sector company to those owned by Ministers, either here or in Wales or Scotland, does not allow for that. That seems to clash with the direction of travel towards more public sector devolution, with which my party and I agree.

It would improve and future-proof the Bill if we amended proposed new section 30C of the Railways Act 1993 so that Ministers could in future choose a company set up or owned by combined authorities, or by groups of unitary, county, district or borough councils who decided to co-operate, ahead of further devolution, on improving their railways. Any decisions on the award of franchises, on the suitability of a body to run and own local railways, and on where investment should go would remain fully with Ministers. I tabled the amendments in a constructive spirit, and I hope that they will start a constructive conversation that will continue here and in the other place as the Bill progresses.

[The First Deputy Chairman]

I call Abtisam Mohamed to make her maiden speech.