High Speed Rail (London – West Midlands) Bill

Debate between Simon Burns and Andy McDonald

Wednesday 23rd March 2016 Commons Chamber

[Sir Simon Burns (Chelmsford) (Con)]

rose—

[Andy McDonald]

I will make some progress.

[Sir Simon Burns]

Come on!

[Andy McDonald]

No, I will crack on.

--- Later in debate ---

[Andy McDonald]

I will give way in a moment.

According to the McNulty report, the fragmentation of our rail network has left us with an efficiency gap of between 30% and 40% compared with other European networks, which means that the money that should be used to address the cost of travel and to fund much needed investment is needlessly wasted.

[Sir Simon Burns]

I am very grateful to the hon. Gentleman for giving way. We had this litany from him, which was put just as eloquently, upstairs in Committee. I wish to ask him this: first, if the privatisation of the railways was such a disaster and disservice to the travelling public, why do we now have record levels of people using the railways; and, secondly, why did the last Labour Government not renationalise it during their 13 years in power?

[Andy McDonald]

I am happy to answer the right hon. Gentleman. It was because the last Labour Government put record investment into the railways and made it the safest railway in Europe. We were clearing up the mess of that botched privatisation of Railtrack, which cost people’s lives. We made the network safe.

We have been left with a ticketing system that is the most expensive and confusing in Europe. Indeed, commuter fares are up by a quarter since 2010, having risen three times faster than wage growth. What the public clearly do not accept is that private and many foreign state-owned companies receive subsidies from the UK taxpayer and make significant profits at the expense of rail passengers.

High Speed Rail (London - West Midlands) Bill (Sixth sitting)

Debate between Simon Burns and Andy McDonald

Tuesday 8th March 2016 Public Bill Committees

[Andy McDonald]

I beg to move, That the clause be read a Second time.

I hope this will be a relatively straightforward matter and that it will give Committee members the opportunity to consider a commonly supported environmental issue: the need for there to be no net loss of trees as a result of the design and construction of HS2.

The Minister will be well aware of the concerns that have been raised by environmental groups, local authorities and community groups about the adverse impact of the construction and operation of HS2 on trees. Trees form a vital part of the heritage of our countryside and brighten the streets.

[Sir Simon Burns (Chelmsford) (Con)]

The hon. Gentleman raises a very important issue that concerns many people. To put his new clause in perspective, does he have any estimate of how many trees might be lost?

[Andy McDonald]

I am afraid I do not have the answer in terms of the raw number. I am pleased to note that there will be a commitment to plant a significant number of trees—I will come to that in very short order. The new clause gives us the opportunity to acknowledge the work that has been done by HS2 to ensure that up to 2 million trees, I think, will be planted. That is very much to be welcomed, so I entirely agree with him.

[Sir Simon Burns]

The hon. Gentleman is absolutely right that the commitment is 2 million trees. The point I was trying to tease out is that I cannot believe that 2 million trees are going to be destroyed in the building of HS2, so why is the new clause needed?

High Speed Rail (London - West Midlands) Bill (Fifth sitting)

Debate between Simon Burns and Andy McDonald

Tuesday 8th March 2016 Public Bill Committees

[Andy McDonald]

I beg to move, That the clause be read a Second time.

In the new clause we address the thorny issue of public sector operation. There has been a great deal of consensus across the Committee thus far, with some notable exceptions; this, we respectfully acknowledge, is perhaps the most contentious issue between us.

If we consider the history of rail privatisation and its impact on the commuting public, it is not difficult to understand the overwhelming public support for bringing railway services back into public ownership. Quite simply, the privatisation of British Rail was a rushed, botched job, which had more to do with ideology than with any clear plan for the nations’ railways, and it left us with a fragmented, inefficient and unsafe network at that time.

[Sir Simon Burns (Chelmsford) (Con)]

If that is the case, why, during 13 years of Labour government, did the hon. Gentleman’s party not do anything to change it?

[Andy McDonald]

To suggest that during 13 years of Labour government nothing was done is to misunderstand the position. A great deal of progress was made with renewals in the railway system, and that must be seen within the context of trying to pick up the pieces after the disaster that was Railtrack. I have already alluded to its appalling record. That left us with an unsafe railway. Much of the 13 years of Labour government was devoted to making it into the safest railway system in Europe. Many people in this room will remember having to reduce speeds down to almost walking pace, because of our concerns about the safety of the points systems and rails. We look back to Potters Bar and Ladbroke Grove, etc., and think of the disasters and loss of life.

To say that our experience of the privatisation of rail infrastructure is not a good one is a gross understatement. It is a huge fear on these Benches that the current proposals to break up Network Rail into eight route businesses may embrace the sorts of dangers that we sadly experienced in those years.

[Sir Simon Burns]

The hon. Gentleman talks about infrastructure, but he has avoided answering the specific question I asked him. If the running of the railways by private companies was so bad, why did not the previous Labour Governments of Blair and Brown renationalise them?

[Andy McDonald]

I will come on to our responses to some of the poor performances and, indeed, failures of the franchised private system. If the right hon. Gentleman will bear with me, I will come to that in greater detail later in my brief contribution. He will know as well as anybody that the McNulty report stated that the fragmentation of our rail network left us with an efficiency gap of between 30% and 40%, compared with other European networks. This means that money which should be used to address the cost of travel and to fund much-needed investment is needlessly wasted. We have been left with a ticketing system which is the most expensive and confusing ticketing structure in Europe. Commuters’ fairs are up by a quarter since 2010, having risen five times faster than wage growth.

Our rail network needs significant investment. Private and foreign state-owned companies are subsidised by the UK taxpayer, while profiteering at the expense of commuters. Far from learning the lessons of the past, the Government seem destined to repeat them.

In illustrating the benefits of publicly-owned operators, one could hardly ask for a better example than the recent case of the East Coast. The previous Labour Government took the important step of bringing the East Coast back into public operation, after the private operator reneged on its obligations in 2009. I have heard it said that failure is somehow a judge of success, in that if franchises fall over and fail, it demonstrates the veracity and robust nature of the franchising system. I do not think that really strikes a chord with the travelling public, who see an unreliable service that does not meet their satisfaction.

East Coast proved itself under public ownership to be the most efficient of operators. It returned almost £1 billion to the taxpayer in premium payments as well as investing every penny of profit—some £50 million—back into the service. In addition, directly operated railways kept fares down, had record passenger satisfaction and engaged the workforce with unparalleled success.

Today is an opportunity for the Conservative party to deliver what the public are asking for by supporting new clause 21, which would require passenger services operating on the whole or part of the high-speed line to be provided by a publicly-owned railway. I hope that when High Speed 2 is open for general use it will be celebrated as a national achievement. I do not agree with the Government that a nation capable of completing such a fantastic rail infrastructure project is not competent enough to operate passenger services, but that the Dutch, German and French are more than capable of doing that for us. Such an attitude that we are not competent enough to do what many of our European counterparts take for granted is effectively talking down our abilities as a nation.

I am sure that we will return to that debate numerous times in this Parliament, but I hope that I was persuasive enough to make the Minister see the veracity of our argument and that he and his hon. Friends will vote with us and with the wishes of the public in support of the new clause.

[Sir Simon Burns]

I do not want to enter a sour note in what have been harmonious proceedings so far, but I fundamentally disagree with the hon. Gentleman’s new clause. I am in good company, because the last two Labour Prime Minister’s shared my view: neither Tony Blair nor Gordon Brown ever wanted to re-privatise the railways while in power and they did nothing to re-privatise the running of them. He failed to answer my interventions on that.

I always find it slightly odd that those who—sadly, like me—are old enough to remember British Rail see it as the halcyon days when everything was wonderful: the trains ran on time; they were terribly cheap, notwithstanding the taxpayer subsidy of fares; and investment in improving the network overflowed. In fact, every time a Government—whether Labour or Conservative—was hit with an economic crisis, one of the first budgets mangled was that for nationalised industries and investment in the railways. That is why both the previous Labour Government and this Conservative Government have had to invest so much money in improving the rail network’s infrastructure: there was so little investment before privatisation.

The hon. Gentleman seems to think that it was a wonderful experience to ride the trains when they were publicly owned, but that was not the case. They were not more efficient and there was out-of-date rolling stock and collapsing infrastructure and, if we go back to 1963, a significant proportion of the network was closed down as a result of the Beeching report. I therefore really do not think that the answer is to turn the clock back to the bad old days as if they were some halcyon period that we should aspire to replicate today.

High Speed Rail (London - West Midlands) Bill (Third sitting)

Debate between Simon Burns and Andy McDonald

Thursday 3rd March 2016 Public Bill Committees

[Sir Simon Burns (Chelmsford) (Con)]

I understand the point the hon. Gentleman is making. So we can understand the extent, will he tell us how much the public will have paid, or will pay?

[Andy McDonald]

Yes. By the time the process is concluded, we are talking somewhere in the region of £55 billion. I hope that answers the right hon. Gentleman’s question—

[Sir Simon Burns]

indicated assent.

[Andy McDonald]

I can see that the right hon. Gentleman is content.

The amendment is about working in the best interests of taxpayers and to ensure that they are not sold short. The taxpayer is our concern, not the private entity that might have transferred to it property and/or property rights which of themselves had been the product of the taxpayer’s significant investment—the sum of £55 billion, or thereabouts. Calls upon the nation’s tax receipts are onerous and to be used wisely, so it is essential that we ensure that those moneys that have created such valuable assets—money that could have served other urgent and serious demands in our communities—are not simply siphoned off into the private sector.

Our concerns are not idle ones, but are extremely well founded. We are dealing with a potential asset sale as I speak, namely the announcement by Network Rail of its intention to sell some 18 railway stations on the existing network. It is of immense concern that, should any such sales go ahead, the receipts will be those of a fair market valuation and not simply from a fire sale to reduce Network Rail’s debts. In advance of the Nicola Shaw review, we hear that Network Rail is to sell off 18 major stations, including Waterloo, Reading and Leeds, in an effort to cut its £50 billion debt. If memory serves me right, Reading has benefited from public investment of some £897 million. I am sure that the public will be watching carefully what happens to the ownerships of those and other named stations.

The same concerns apply to HS2. I am afraid that the Government have form and that we have less than good experience, to say the least, of sell-offs of publicly owned assets that failed to secure fair or market value for the taxpayer. We need cast our minds back no further than the disastrous sell-off of the Royal Mail, which is still fresh in the minds of millions of voters. The Select Committee on Business, Innovation and Skills found that taxpayers may have lost out on about £l billion from the undervaluing of Royal Mail. Apparently, the Government feared failure and acted on bad advice over the Royal Mail stock market flotation. As we know, the shares fluctuated widely with an initial price of 330p which jumped as high as 618p and now stands somewhat lower than that. The then Business Secretary, Vince Cable, said:

“They”—

presumably meaning the BIS Committee—

“now have the benefit of hindsight, which we didn’t have at the time. We sold at a price that was regarded as the best that could be achieved in the context in which we sold it.”

But the Chair of the BIS Committee, my hon. Friend the Member for West Bromwich West (Mr Bailey), said:

“It’s very important that when the government does sell off a government asset, it does so through a process that quite clearly demonstrates that nobody selling it, nobody advising it, has a conflict of interest”.

We do not want a repeat of the conduct of the likes of Lazards who were working on the inside on the sale of Royal Mail as Government advisers and then, because of the erection of an invisible virtual Chinese wall, were able to fill their boots on the acquisition of Royal Mail shares from the profits they achieved in a few short hours after launch. A number of individuals, some with high-profile political associations, also personally cashed in. We simply do not want HS2 to be turned into a profiteering exercise at the public’s expense.

You will recall the evidence unearthed by the Public Accounts Committee under the expert chairing of my right hon. Friend the Member for Barking (Dame Margaret Hodge). It revealed that Lazards advised the Government not to increase the price of Royal Mail shares, despite widespread fears they were hugely undervalued, and made a profit of more than £8 million by immediately selling the company’s stock. My right hon. Friend the Member for Barking said that Lazards

“made a killing at the expense of the ordinary taxpayer that lost £750 million in one day”.

A subsequent report by the National Audit Office found that the Government decided against increasing the flotation price of Royal Mail beyond 330p a share because of warnings from Lazard & Co. Government advisers were asked point blank at the Committee chaired by my right hon. Friend the Member for Barking how they could get it so wrong that it cost the taxpayer £750 million on that one day.

Vince Cable, the then Secretary of State for Business, Innovation and Skills, said that the postal service should,

“start its new life with a core of high-quality investors who would be there in good times and bad”.

So much for that hope, Mr Hanson. As you and I both know, the road to hell is paved with good intentions.

High Speed Rail (London - West Midlands) Bill (First sitting)

Debate between Simon Burns and Andy McDonald

Tuesday 1st March 2016 Public Bill Committees

[Andy McDonald]

I beg to move amendment 12, in clause 16, page 7, line 19, leave out—

“the end of five years beginning with”.

This amendment would remove the power of the nominated undertaker to use specified roads for the passage of persons or vehicles for five years after Phase One is brought into general use.

This is very much a probing amendment—I do not think we will need to divide on it. It is about an issue raised by the right hon. Member for Chelmsford: the project being on time. As currently drafted, the clause leaves the timescales in some doubt. The Opposition agree that the nominated undertaker should of course have the power to use any roads on specified land for the passage of persons and vehicles for the purposes of phase 1 of High Speed 2, but it is not clear why the nominated undertaker will require that power for five additional years after phase 1 has been brought into general use. Once it is up and running, it is up and running. I do not want to put at residents’ doors the spectre of vehicles trucking up and down with materials.

[Sir Simon Burns]

As the hon. Gentleman was talking, I was wondering whether extra time might be needed to, for example, continue to clear a site of debris if there had not been the time to do so before phase 1 was up and running.

[Andy McDonald]

The right hon. Gentleman makes a good point, and that may indeed be so, but the clause currently specifies a five-year period beyond the project being completed and effective. Something would have to have gone badly wrong if the clearance of debris and materials took five years.

I keep coming back to the example of Euston. The people in that neighbourhood will necessarily be affected by very considerable building works. We will discuss this in greater detail later in Committee, but some of the works will be really close to people’s homes—within a few metres of retaining walls and retained properties next to HS2—so they will have enough on their plate. I would suggest that the prospect of the project being concluded but there being permission for roads to be used for the specified purpose for a further five-year period will be intolerable.

We are suggesting that the reference to five years be left out, leaving subsection (2) to read: “The power…may not be exercised after the date on which Phase One of High Speed 2 is brought into general use.” The right hon. Gentleman’s point is fair, but the amendment was tabled to highlight the fact that things could literally rumble on for years, long after HS2 is up and running. Will the Minister help us by explaining why it is necessary for the nominated undertaker to be able to exercise the power for such a long time?

High Speed Rail (London - West Midlands) Bill (Second sitting)

Debate between Simon Burns and Andy McDonald

Tuesday 1st March 2016 Public Bill Committees

[Andy McDonald]

I am indeed. I am grateful for the clarification, Mr Hanson.

The amendment expresses our concerns about the volume of motor traffic that would be generated by the interchange station. We have been informed by the Campaign to Protect Rural England, whose petition on the issue and representations to the Select Committee we note. The CPRE’s initial concern was that the Birmingham interchange would be situated in the green belt. In our amendment, we are pursuing not that concern but some other legitimate concerns raised about the consequences of the station’s location.

This amendment attempts to address the volume of traffic that will be generated by the interchange station, the associated proposals to expand the capacity of the surrounding road, and the pressure that would create for further expansion of the road network in the surrounding area.

One of the overarching purposes of building a railway, or indeed of investing in any form of public transport, is to reduce the number of journeys taken by car. Efforts should be made to ensure that there is not an inadvertent increase in net journeys by private car. The fear is that the inadvertent consequence of the specifications contained within clause 23—or, rather, the lack of them—may produce an undesirable outcome. It is submitted that the management of car parking spaces is one of the most efficient means to influence travel choices. There is a significant worry that the plans as set out in the Bill might encourage extra journeys by car. Indeed, one of the representations from the Campaign to Protect Rural England initially asked for the limit to be placed at 2,000 car parking spaces—yet the clause gives the much higher figure of 7,500—and also suggested that the limit placed on spaces for coaches should be increased to 25, and that car parking spaces should be multi-storey. That gives a flavour of some of the concerns of the Campaign to Protect Rural England.

As I say, currently the Bill provides for a limit to be placed on the provision of car parking places of 7,500 and, somewhat curiously, five parking spaces for coaches. I do not know whether the Minister can shed some light on that. That seems to be a very strange ratio, but undoubtedly there will be a logical explanation for it.

Be that as it may, the exclusions in subsection (4)(c)(i) of the clause exempt,

“the provision of short-term parking for cars”,

and, understandably, also the short-term parking for taxis and coaches. Subsection (4)(c)(ii) specifies an exemption for “parking on working sites”.

The clause puts a limit on car parking spaces of 7,500, but short-term car parking spaces are excluded from that. Exclusion from the provision may well serve to increase yet further the number of vehicles parked at Birmingham Interchange. As there is no definition of the term “short term” for the car parking spaces in Birmingham, people who currently plan to travel by train to Birmingham and then change trains might alternatively decide to drive to the station by car and park there, rather than using other forms of public transport. The whole issue is how to get some modal shift in how people go about their business.

[Sir Simon Burns (Chelmsford) (Con)]

As the hon. Gentleman was speaking, I wondered whether there is not a problem when there is no legal definition of “short term”. The hon. Gentleman’s amendment seeks to define it as up to 12 hours, yet at Heathrow airport short-term parking is up to three or four days, for example. It seems rather vague terminology to use on the face of a Bill.

[Andy McDonald]

I entirely agree with the right hon. Gentleman. That is why we seek to specify the number of hours that constitute short-term car parking. It varies from one environment to another. In very busy city centres it might be 20 or 30 minutes, or it might be an hour. There is no universal statutory definition of what short-term car parking is. The amendment tries to address that for the purposes of this particular location.

Oral Answers to Questions

Debate between Simon Burns and Andy McDonald

Thursday 12th September 2013 Commons Chamber

[Mr Burns]

Because, as I would hope the hon. Gentleman appreciates, the purpose of Directly Operated Railways is not to run a railway ad infinitum; it is a short-term measure when a problem arises with a franchise. He is absolutely right that as part of the record-breaking investment in our rail infrastructure we are investing in the east coast main line—as we are doing in the west coast main line and other lines— because that is the way forward. With the innovation and impetus of the private sector and a private sector franchisee, the maximum benefits can be ensured from state and Government investment.

[Andy McDonald (Middlesbrough) (Lab)]

Why have the Government reordered the franchising timetable, and what is the justification? The east coast main line timetable has been accelerated way out of order. What is the cost to the taxpayer?

[Mr Burns]

The reason for the change in the timetable is the unfortunate episode with the west coast main line—[Interruption.] I said “unfortunate”. Following the Brown inquiry, we redrew the franchising programmes and took his advice that the west coast main line and east coast main line franchises should not be done at the same time. That is why we are pressing ahead with putting the east coast main line franchise back into the private sector in February 2015.

East Coast Main Line

Debate between Simon Burns and Andy McDonald

Wednesday 5th June 2013 Westminster Hall

[Andy McDonald (Middlesbrough) (Lab)]

It is a great privilege to serve under your chairmanship, Dr McCrea, in this vital debate on the future of the east coast main line. I am sure you will keep us on track and on time. Debates between hon. Members on nationalisation and democratic control of industry often stall due to an obstinate adherence to our political prejudices. All of us, on both sides of the House, have political prejudices about the relative merits of private and national ownership of basic industries. At the outset, I invite Members to disregard all preconceived theories and consider the future of the east coast main line objectively, as a technical problem with hard facts.

According to a written answer from the then Minister of State for Transport in 1996, the total gross proceeds to the taxpayer from selling off our rail infrastructure were £5.28 billion. Adjusted for inflation, that would be slightly more than £8 billion today—equivalent to only the past two years of taxpayer subsidy. According to the Office of Rail Regulation, the east coast main line is the only line in the country that comes close to paying for itself. Government subsidy makes up only 1% of East Coast’s income, against an industry average of 32%. The total cost to the Exchequer of the east coast main line was only £9 million in 2011-12; by comparison, Northern Rail, jointly owned by Serco and the Dutch Government, cost the taxpayer £685 million. Since the UK Government put the franchise under the publicly owned Directly Operated Railways, financial stability has been restored. The total premium, plus operating profit, amounted to £647.6 million in the four years to 31 March 2013; that is more in both cash and real terms than any previous franchise on the line, and all that money is available for reinvestment in our railway network.

East Coast has seen revenue growth of 9% over three full years, with 4.3% growth in 2012-13. The Minister of State described that growth to the Select Committee on Transport as a “plateau”. One wonders what word he would use to describe the Chancellor’s performance over the same period.

[The Minister of State, Department for Transport (Mr Simon Burns)]

Very good.

[Andy McDonald]

Thank you very much.

Journey numbers have grown from 18.1 million in 2009-10 to 19.1 million in 2012-13. An estimated £800 million will have been generated by the franchise for the taxpayer by April 2014. All that has resulted in a £40 million surplus: money that would otherwise be providing the profit to shareholders, if the line were privatised, and which East Coast has reinvested in its greatest asset, its staff. The fruits of that investment are clear to see: employee engagement is now at an all-time high of 71%—up from 66% in 2011 and 62% in 2010—which is the highest score of the eight train operators that is currently available. The average number of sick days has fallen from 14 to nine. Investors in People accreditation has risen from “standard” in 2009 to “silver” in 2012. Impressively, East Coast was the only train company to have achieved “Britain’s top employer” status in 2012 and 2013. Most importantly, on-board passenger-attributed accidents have reduced by 20% and staff accidents by 23% in the past year.

East Coast has also introduced a new timetable—the biggest change on the east coast main line in 20 years—seamlessly launched in May 2011. It introduced 117 extra services a week; a four-hour Flying Scotsman express from Edinburgh to London, calling only at Newcastle; and new direct services between London and Lincoln and Harrogate, and I hope that it will soon restore the link to Middlesbrough, the largest conurbation in the country without a direct link to the capital.