Crossrail

Theresa Villiers Excerpts

Tuesday 14th December 2010 Written Statements

[The Minister of State, Department for Transport (Mrs Theresa Villiers)]

I wish to update the House on Crossrail progress since my annual update on 15 July 2010, Official Report, columns 43-44WS, in which I undertook to report later in the year on progress made by Crossrail Ltd on their value-for-money programme.

The spending review announcement confirmed Government’s joint commitment with the Mayor of London to delivering Crossrail, and secured the funding to deliver the scheme to its original scope.

As I indicated in July, Crossrail Ltd has been undertaking a programme of value engineering, risk avoidance and mitigation, alongside indirect cost reduction to ensure that the scheme is delivered in the most efficient way possible. In line with this approach, the Government accepted an engineering-led solution to delivering the central section which has enabled substantial savings of around £1 billion to the Crossrail funding package to be identified. While the construction programme for the central section will be lengthened by around a year, this has enabled the Government to confirm that funding is available for the whole project.

We now expect that Crossrail services will commence from 2018. However, the detailed timetable for the phased introduction of Crossrail services requires additional work in a number of areas. For example, further work needs to take place on:

(i) the transfer of services from existing franchises to the future Crossrail operations; and

(ii) the development of detailed plans on the commissioning of services.

It should be noted that Crossrail services were always planned to be phased into operation over some months and it remains a priority for the Government to ensure services are commissioned in the most efficient possible way.

In addition, I wish to inform the House that Crossrail Ltd has issued its notice of intention to award the tunnelling contracts for the central section tunnels. These contracts mark a further milestone in Crossrail’s progress towards the start of tunnelling in late 2011.

Crossrail Ltd continues to work to achieve further savings in advance of the final review point for the project in spring next year. I expect to make a further update on progress then.

EU Transport Council

Theresa Villiers Excerpts

Monday 13th December 2010 Written Statements

[The Minister of State, Department for Transport (Mrs Theresa Villiers)]

I attended the second Transport Council of the Belgian presidency in Brussels on 2 December.

The Council discussed air cargo security. Following the recent discovery of explosive devices in air cargo, a high-level group produced a report on strengthening air cargo security, for both Council meetings on 2 December (Transport and Justice and Home Affairs). The presidency presented this report, which sets out ways to strengthen the security regime around air cargo coming into the EU.

The UK broadly welcomed the report and the associated action plan and provided the Council with some details of the recent air cargo incident. The presidency concluded orally that the Council had a “positive appreciation” of the report, and asked the Commission and member states to ensure a speedy implementation of the action plan. The Commission was asked to report back to the Council on progress made. A parallel discussion took place in the JHA Council.

The presidency updated the Council on progress with negotiations on the draft directive on cross-border enforcement in the field of road safety. The proposed directive aims to improve cross-border enforcement of certain road safety offences by facilitating exchange of data between authorities. The UK and Ireland supported a proposal to change the legal base for this proposal to Justice and Home Affairs, and emphasised that this change engaged our right to decide whether or not to opt in to the directive. We reserved our position on the substance, pending formal consideration of our stance and consultation with Parliament during the permitted three-month period. Both countries tabled minute statements to this effect.

All member states were in favour of the change of treaty base. The Commission has however made it clear that it does not support a JHA legal base. The presidency concluded that there was consensus on the text of the draft directive, but did not seek confirmation of a political agreement. They acknowledged the UK’s rights under protocol 21 to have the necessary period to consider whether or not to opt in.

The Commission presented its recent proposal to recast the 2001 first rail package, which set the initial framework for a single European rail market. The presidency gave an account of early discussions on the proposal. The discussion in the Council concluded that the publication of national rail infrastructure development strategies was a good approach. The UK broadly supported the proposal, in particular endorsing the need for adequately resourced and properly independent regulatory bodies, in order to facilitate market entry and competition. However, I highlighted the importance of effective enforcement of the existing directive if we are to see real progress on opening up rail markets across Europe to cross-border competition. Discussions will continue under the Hungarian presidency.

The presidency reported on progress in discussions on a proposal for a decision on the public regulated service (PRS) of the Galileo programme. The decision would set out controls over access to the high-accuracy positioning signal from Galileo. The UK noted the lack of an impact assessment and expressed disappointment at the lack of visibility on costs. We expressed concern about handling of security and stressed that common minimum standards needed to be defined by the GNSS (Global Navigation Satellite System) Security Board. Discussions will continue under the Hungarian presidency.

Following the informal meeting of EU Transport Ministers held in Antwerp in September, the Council adopted conclusions on the integration of waterborne transport into the EU logistics chain. The conclusions are acceptable to the UK.

The Council also adopted conclusions following the Commission’s communication entitled “Towards a European road safety area: policy orientations on road safety 2011-2020”. The conclusions state that any new EU legislation must be proportionate and supported by robust impact assessments, and the UK was able to support their adoption.

Among AOB items, the Commission gave a presentation of its recent proposal to revise the regulation which established the European Maritime Safety Agency and to bring the agency’s tasks into line with more recent legislation. The UK supported a statement by Germany, which expressed concern about any increase in EMSA’s budget and staffing.

Rail Services (Erewash)

Theresa Villiers Excerpts

Tuesday 7th December 2010 Westminster Hall

[The Minister of State, Department for Transport (Mrs Theresa Villiers)]

It is always a pleasure to serve under your chairmanship, Mr Gale. I congratulate my hon. Friend the Member for Erewash (Jessica Lee) on securing the debate. She is clearly an able advocate for her constituents. She set out with great clarity the benefits that a new station at Ilkeston or in the Ilkeston area could bring them. She has made an attractive case for taking the project forward.

I welcome the opportunity to set out the Government’s view of the proposal. As we have heard from my hon. Friend this afternoon, the provision of a new station has the full support of Derbyshire county council; I understand that Nottinghamshire is also very supportive. My hon. Friend also outlined strong support in the local area, among the population and the business community. That is pivotal; the benefits of the proposed new station would accrue almost exclusively to a localised area. In such cases, the Government look for strong local support if progress is to be made. It is for local authorities rather than Whitehall to determine whether a new station is the best way to meet the transport needs of the community.

I am encouraged to learn that Derbyshire county council has taken a very active role in taking this scheme forward, alongside my hon. Friend. The county council has engaged well with Network Rail and with Northern Rail, the local train operator. My understanding is that in 2009 Derbyshire commissioned a feasibility study, building on work on the proposal that was carried out in 1999 and 2000. That study concluded that a new station would be deliverable in practical terms and indicated that the project had the potential to yield good value for money. The study indicated that income from generated travel—passengers using the station who previously would not have travelled by train—could more than cover the on-going costs of running the station.

The study is significant. The pressing need to address the deficit that we inherited from our Labour predecessors means that we have to take more care than ever to safeguard taxpayers’ money and keep spending under control. It is therefore very difficult for local rail schemes to get the green light if it is expected that they will require an additional ongoing subsidy from the taxpayer. While the studies that have been carried out do not provide us yet with a definitive answer on value for money or commercial viability, they give us some credible evidence that calls at a new station could be deliverable without an additional subsidy.

Assuming that that issue is potentially resolvable, there are three further questions that it would be useful for us to consider this afternoon. First, how could the capital costs of building a new station be funded? Secondly, is it possible to accommodate calls at the new station within existing schedules? Thirdly, will the existing and future franchisee be prepared to call at a new station?

As to the first question, it is for Derbyshire county council as the promoter of the new station to identify funding for the capital costs of building it. It would be open to the county council to prioritise the project for support from the integrated transport block. However the crisis in the public finances means that all councils face difficult choices on how they use limited capital budgets. ITB budget cuts certainly make it more difficult for that funding stream to provide the answer in this case. However, the Government have announced two new sources of money, which could be relevant to the project, and which are well worth considering.

As my hon. Friend has mentioned, one of those sources is the regional growth fund, which is expected to be worth £1.4 billion over three years and is now open for its first round of bids. I am pleased to hear that Derbyshire has been quick off the mark, and expects to be able to put in a bid soon. The fund is designed to stimulate enterprise, encourage growth and create jobs in the private sector. It can be used for investment in transport, because tackling congestion and improving connections between cities and towns to link people to job opportunities can maximise agglomeration benefits; those can be two of the best ways to boost economic growth. I was interested to hear what my hon. Friend had to say about the difficult economic climate for her constituents. No doubt those factors will be relevant in the consideration of the bid for funding from the regional growth fund. I also take on the points made by my hon. Friends the Members for Sherwood (Mr Spencer) and for Erewash about the economic benefit that a new station could generate in the local area.

If an RGF bid is to have a realistic chance of success, the supporters of the scheme, such as the county council, are important. My hon. Friend has worked with private sector partners in the business community; I am delighted to hear that that is what is happening. It is good to hear of support from the Erewash Partnership and others in the business community there. I understand that a local enterprise partnership is being set up in Derbyshire and Nottinghamshire. No doubt its involvement in the project will be very useful in helping to identify private sector support and, potentially, contributions.

A second potential source of support for such a project is the local sustainable transport fund. The coalition has established that fund to deliver local transport projects that stimulate growth and reduce carbon emissions. We expect the fund to contain £530 million over the CSR period—so it is a substantial amount of money—and we will provide more details shortly on how it will operate and how local authorities may be able to bid for and get access to the funding. That funding stream may be relevant and worth considering in this case. Thus there are various options, which the county council and the others who support the scheme may want to explore. I emphasise that my officials are happy to discuss those possibilities further with the county council and the promoters of the scheme.

I now move on to my second question—whether a stop at Ilkeston can practically be accommodated within the existing service pattern. Two regular passenger services pass through the proposed site: the Liverpool-Norwich service run by East Midlands Trains and the Leeds-Nottingham service run by Northern Rail. Following early discussions with the train operators, I understand that the county council concluded that stopping the Leeds-Nottingham service would be the more feasible of the alternatives, although that would not necessarily preclude other services from calling in the future, if it proved to be commercially viable.

The good news is that Network Rail is funded to re-signal the Erewash Valley line and the western approaches to Nottingham station. The work is due to finish by 2013. I am advised that that upgrade could potentially create the additional time in the schedule needed to enable services to call at a new station at Ilkeston. However, services would have to be fairly tightly timed, and that would put some additional pressure on the timetable. It is important to consider the effect of that pressure on reliability and the overall impact of a new station on longer distance passengers. The market for travel between Nottingham, Sheffield and Leeds is growing. There is strong support among local authorities for journey time reductions between Leeds and Nottingham. Making a call at an additional station would run counter to that ambition. Journey times would be about three minutes slower than otherwise.

In essence, as is so often the case with the configuring of rail services, there is a balance to be struck between the local interests of my hon. Friend’s constituents and those of my hon. Friend the Member for Sherwood, and the economic benefits that could accrue across a wider area with shorter long-distance journey times. Careful thought would need to go into getting that balance right. However, the evidence that I have seen does not lead me to conclude that the issue would give rise to an insurmountable barrier to the project going ahead: so that is not a show-stopper either.

[Mr Spencer]

It is worth putting on record our thanks to the Minister’s Department for the amount of money that is being spent not only in Nottinghamshire and Derbyshire but in the whole of the east midlands. That will, I hope, push forward the east midlands, generate more jobs and drive us out of the disastrous economic position that the Government found when they came to power. Does my hon. Friend recognise how important it is to make transport links—not just new train stations like the one that is wanted at Ilkeston but links to cycle routes and other public transport hubs—so that people can get from their place of residence to their employment, to generate their own income and drive the economy forward?

[Mrs Villiers]

I am grateful to my hon. Friend. A striking aspect of the comprehensive spending review was the Chancellor’s commitment to continued investment in our transport infrastructure. Past spending squeezes often meant that the axe was taken to a whole range of transport upgrade projects. We have decided not to do that, because those projects can play an important role in generating the growth we need to get out of the economic mess left by the previous Government. Integrating different modes of transport can, of course, yield important benefits for passengers and, similarly, valuable economic benefits, if people have better access to different modes of transport and we try to co-ordinate them.

[Nigel Mills]

I concur with the Minister’s assessment. The Liverpool-to-Norwich train was taken off from stopping at Langley Mill, and was effectively replaced by the Leeds-to-Nottingham service, which stops twice in my constituency, at Alfreton and Langley Mill. That service has proved very popular, according to the number of people I have seen on that train when I have used it.

I would strongly oppose any timetable changes that removed that service from stopping at either of those two stations in my constituency. This proposal should be an incremental addition to that service, not a replacement. There have been rumours of a threat to Langley Mill station if Ilkeston were reopened. I would urge the Minister not to go down that route.

[Mrs Villiers]

I am not aware of any intended subtractions of services. As my hon. Friend says, we are discussing today whether it is realistic and practical to add a service and a station at Ilkeston, but he makes a good point.

The third of the questions that I posed at the start of my speech was whether commercial incentives alone would motivate train operators to call at a new station at Ilkeston. That is another important issue that we need to address. Before going ahead, the Department would expect the county council to confirm with Northern Rail whether it would be prepared to stop at a new station. However, its franchise is coming to an end relatively shortly, and it is not easy to predict what approach a future franchisee might take. Although the studies undertaken for the county council indicate that revenue from the station calls would outweigh the costs of its operation, train operators might take a different view of the impact of journey-time changes on longer distance passenger numbers, and hence on ticket revenues.

The Department for Transport is certainly prepared to consider whether it would be justifiable and appropriate to include obligations in relation to the new station in the future franchise contract. As the House will be aware, the Government have been assessing how to reform the franchising process, and we made a further announcement on that today. We want to see a move away from the specification of highly detailed inputs that leave little flexibility for train operators to innovate and respond to the changing needs of passengers. That said, franchise contracts under the new system will continue to contain obligations on service levels. We could consider whether that should include obligations in relation to a new station at Ilkeston.

The issues raised by the third question that I posed look as if they also could be resolvable. However, I would emphasise the word “resolvable”, not “resolved”. It is important to ensure that the commercial case for the station is rigorously assessed, so that the Department, the county council and train operators can be as confident as we can that the new services would be commercially viable. That is pivotal. Without that confidence, it is difficult to see how the project can get off the ground.

I am grateful to my hon. Friend the Member for Erewash for the opportunity to give an indication of the Government’s approach. In conclusion, it is clear that the coalition will face difficult decisions if we are to address the crisis in the public finances that we have inherited and get our economy back on track.

[Jessica Lee]

I am very encouraged by the Minister’s response, in particular the view that, although there are hurdles and complexities to this project, all have the potential to be resolved. That encouragement will be received well in Erewash.

[Mrs Villiers]

I am grateful. In these difficult times, there will be issues to resolve about whether funding can be secured, but this is a worthwhile project, and I and my officials at the Department of Transport are happy to continue to work with my hon. Friend and Derbyshire council to see if there is a way forward. The crisis in the public finances puts significant constraints on the funding available but, as I said earlier, the Chancellor has clearly accepted that transport infrastructure projects can often yield high value for money for taxpayers. They can provide economic benefits many times their cost. That is why rail has emerged from the spending review in a far stronger position than most people expected, albeit with some necessary tough decisions on fares. We have broken the recurrent pattern of spending squeezes of years past, which was to take the axe to a wide range of capital infrastructure projects, with rail and roads often the first to suffer.

While proposals for a new station at Ilkeston need to be taken forward locally—rather than through the national rail budget—a number of funding streams might be a source of support, as we have been able to consider this afternoon. Along with my hon. Friends the Members for Erewash and for Sherwood, and others who have taken part today, I feel that this is a worthwhile project. My officials at the Department for Transport remain happy to work with the county council to see if a way can be found to take it forward. I would like to thank my hon. Friend the Member for Erewash for giving the House the opportunity to consider this important issue for her constituents and others in the area.

Transport Council

Theresa Villiers Excerpts

Thursday 2nd December 2010 Written Statements

[The Minister of State, Department for Transport (Mrs Theresa Villiers)]

I will be attending the second Transport Council of the Belgian presidency which will take place in Brussels on 2 December.

The Commission and presidency will present a report on possible measures to improve aviation security. The UK welcomes this report and will press for early, effective and co-ordinated action by member states.

There will also be a debate on the draft directive on cross-border enforcement in the field of road safety. The presidency intends to reach a conclusion on progress towards a political agreement. We hope that the conclusion confirms the accepted view that political agreement can only be achieved once the UK and Ireland have completed parliamentary scrutiny and made their opt-in decisions.

There will be a progress report and policy debate on the legislative proposal to recast the first rail package, establishing a single European railway area, which was presented to the Council in October.

A progress report will be considered on work towards a Council and European Parliament decision on access to the public regulated service of the Galileo satellite navigation system. I will press for greater clarity on the estimated infrastructure and operational costs as well as an indication from the Commission on whether it proposes to charge member states for access to the public regulated service. This will help the Government determine their position on use of this service. The Government continue to oppose increasing the budget for completion of the Galileo system.

The Council will be asked to adopt conclusions, on the integration of water-borne transport into the EU logistics chain. These conclusions follow the informal meeting of EU Transport Ministers held in Antwerp in September. We welcome these conclusions on this important sector.

The Council will also be asked to adopt conclusions following the Commission’s recent communication entitled “Towards a European road safety area: policy orientations on road safety 2011-2020”. As the conclusions set out that any new EU legislation must be proportionate and supported by robust impact assessments, I intend to support their adoption.

Transport (CSR)

Theresa Villiers Excerpts

Thursday 25th November 2010 Westminster Hall

[Jackie Doyle-Price]

I hope that the Minister was listening to the hon. Lady; I was struck by what she said. When I hear the business community in my constituency crying out for increased local investment and telling me that their biggest concern is the poor transport infrastructure, I am sure that such a plan would be welcome. It would be interesting to know why such a conclusion has been reached.

[The Minister of State, Department for Transport (Mrs Theresa Villiers)]

Let me set the record straight after the comments made by the hon. Member for Worsley and Eccles South (Barbara Keeley). The project under discussion has not been “shelved”; it is in the programme that we hope to take forward post-2015. There has been a postponement, but not a cancellation.

[Jackie Doyle-Price]

I am grateful to the Minister. The point is that for my business constituents, the improvements cannot come soon enough. That brings me to the point raised by the hon. Member for Cheltenham about the Dartford tunnel. As I said, we are at the northbound point of the Dartford crossing. There is light at the end of the tunnel for the funding of improvements to junction 30, and that is the Dartford tunnel. As the hon. Gentleman said, the CSR proposed a 66% increase in tolls, and there is a lot of local anger about that. The deal was for the tolls to be cancelled once the crossing had been funded, but we have long passed that point. Having said that, my constituents are really quite hacked off with the number of times that they get caught on the local road network, and they would take it on the chin if the tolls were increased as long as they got something out of the deal. If we are looking at where funding from that increase in tolls is to be spent, I hope that my corner of south Essex gets its fair share.

Let me re-emphasise the need to invest in improvements to junction 30. I would also like to see the proposals in the CSR for an additional crossing brought forward sooner rather than later. The congestion on the M25, and the crossing in particular, have been neglected for far too many years. We must have a consensus on where an additional crossing should be constructed. As we know, traffic volume continues to grow exponentially and we are always playing catch-up with such things. I understand that revenues will be hypothecated for transport investment, and my plea is for Thurrock and south Essex to be looked on favourably. That would be good not only for my constituents but for UK plc and the businesses that I have mentioned.

--- Later in debate ---

[Jim Fitzpatrick (Poplar and Limehouse) (Lab)]

It is a pleasure to be here under your chairmanship, Mr Gray. This is the first time that I have spoken from the Opposition side of this Chamber. I would naturally rather be where the Minister is and I certainly was there for a couple of years. It reminds me of the question asked by many people about what it is like being in opposition after 13 years. As a former Minister responsible for road safety, I use a roads analogy. I tell people that it is like when they go to Europe for the first time and drive on the right-hand side of the road. It is strange, but I get it; I know what I am supposed to be doing. However, every junction and every occasion have to be approached with additional care.

Like other hon. Members, I congratulate the Chairman of the Select Committee on Transport, my hon. Friend the Member for Liverpool, Riverside (Mrs Ellman), on securing the debate, on the way in which she introduced it and on the way in which she leads her Committee. She is very highly regarded in the House, as all new Members will quickly come to realise, if they have not already.

Conservative Members may not be surprised to hear that I do not accept their rosy view of the impact of the comprehensive spending review on transport. The CSR settlement will mean a scaling back of Labour’s plans for transport infrastructure and a significant increase in the burden that falls on passengers through increased fares. I shall try to comment on hon. Members’ contributions later in my remarks.

The Department’s budget has suffered a 15% cut in real terms. That includes not only savings of 21% from the resource budget but, more worryingly, an 11% reduction in capital spending. The implications of that will be felt not just by the travelling public. Because investment in infrastructure projects is vital to growth, it will also affect the recovery, manufacturing and jobs.

[Mrs Villiers]

rose—

[Jim Fitzpatrick]

I am delighted to give way to the Minister.

[Mrs Villiers]

The Budget produced by the Government of whom the hon. Gentleman was a member put in place a predicted 50% reduction in capital spending. In the light of that, is it not the case that an 11% cut for transport is really not a bad result in comparison with what other Departments are subject to?

[Jim Fitzpatrick]

I do not for a second, in any way, shape or form, do anything other than congratulate the Ministers on fighting their corner for transport, but when I explain later why I am disappointed with the outcome, the details of the position will become clearer.

The Secretary of State has been over-spinning his settlement as a great success when it is nothing of the kind. Even the Institute for Fiscal Studies listed the Department for Transport as a “loser” in the CSR. Combined with the huge reductions in funding for local government, the impact will be felt by passengers throughout the country.

The Government are trying to get away with these myths: that Labour was planning a much bigger cut in capital spending and that the present Government are proceeding with even more spending on capital projects than was planned by Labour. Both claims are not true. First, the Government have set out spending plans to 2015, for the whole five-year Parliament. They are therefore never comparing like with like. That is classic smoke and mirrors, and I cannot believe that any Government would get up to such tricks.

Secondly, the Government insist on changing the point that they use as their baseline to suit their case. The reality is that even before the CSR, the Government had made £683 million-worth of spending cuts, including £309 million from local transport grants—made up of £61 million from major local authority schemes, £151 million from integrated transport block grant, £8 million from the urban congestion fund, £17 million from the road safety capital grant and £20 million from the road safety revenue grant—£108 million from Transport for London, £100 million from Network Rail, resulting in the scrapping of the better rail stations programme to upgrade 10 key national interchange stations judged the worst in the country, £54 million by deferring schemes and £112 million in internal cuts from the DFT, including staffing.

[Mrs Villiers]

The hon. Gentleman is identifying certain cuts that he alleges are being made, which clearly he is concerned about. If he will not accept reductions in certain transport programmes, where does he expect the reductions to come in order to tackle the deficit that the Government he was a member of left to us?

[Jim Fitzpatrick]

We do not accept for a second, as was clearly outlined by my right hon. Friend the shadow Chancellor in a speech only last month, that it was a Labour deficit. The deficit was created by an international banking crisis that started in the US. Most other countries copied the UK Government’s solution in restabilising their financial institutions and trying to ensure that the economy was in a position to recover.

We accept that cuts have to be made. We do not demur from that in any way, shape or form. I shall come to that in a second.

--- Later in debate ---

[Jim Fitzpatrick]

I will do my best to close that down and get back to my text, which I assure you, Mr Gray, is focused on the CSR.

To respond to the hon. Member for Ealing Central and Acton (Angie Bray), spending under Labour was not out of control. It was strongly supported by both coalition partners at the time. Indeed, there were criticisms from the Secretary of State for Business, Innovation and Skills and the Chancellor when they were in opposition that we were not spending enough. I therefore do not accept the hon. Lady’s argument.

To follow your admonition, Mr Gray, and return to my text, the shadow Chancellor has proposed additional taxation on the banking industry that would raise £7.5 billion and enable us almost to halve the Government’s cut of a third to infrastructure spending. As I have said to the Minister, there would have been cuts under Labour, but they would not have been so severe and the burden would not have been put on passengers through huge hikes in fares.

As an aside, the UK Chamber of Shipping president, Mr Jan Kopernicki, was recently quoted as saying that not bringing forward the new Type 26 frigates from 2020 to assist in dealing with piracy would cost the UK economy and endanger British and other shipping. I ask the Minister to pass that message back to the Treasury and the Ministry of Defence.

In government, Labour delivered major improvements to our rail network, resulting in greater reliability, faster journey times and more passengers than at any time since the 1940s. We set out an ambitious long-term vision for conventional rail alongside our ambitious high-speed rail plans. Our plans included new capacity, better infrastructure and a strategic freight network. We had no plans to make passengers pay more for less, because if people see fares increasing when plans for new capacity and infrastructure are being cut, fewer people travel by rail and there is increased congestion on our roads.

I welcome the fact that the Government have changed their position and now support the Labour Government’s proposed route for High Speed 2. That was more of a Y-turn than a U-turn. There are clearly splits in the Cabinet over this issue and even, we read, threats of resignation. I assure the Minister that the Opposition understand the economic importance of the project. It will bring the west midlands within about half an hour of London and deliver journey times of 75 minutes or less from Leeds, Sheffield and Manchester to the capital. Connections to existing tracks will enable direct high-speed train services to Glasgow, Edinburgh, Newcastle and Liverpool.

We also welcome the Secretary of State’s confirmation this morning that some of Labour’s plans for additional investment in rail infrastructure will go ahead, including electrification projects, new carriages and station improvements. We do not welcome the delays and reductions in vital projects such as Crossrail, which was mentioned by the hon. Member for Ealing Central and Acton. Crossrail will make journeys across London faster, allow direct access from Heathrow to the City, enable 200 million passenger journeys a year, add 30,000 high-value jobs to London in the first 10 years of its operation and add an estimated £20 billion to the UK’s GDP.

[Mrs Villiers]

I had hoped that the shadow Minister would recognise that it is a great result that we have been able to save Crossrail despite the crisis in the public finances. He should also acknowledge that the lengthening of the delivery time for the central section was the result of an engineering-led review on how to deliver the project in the most cost-effective way for the taxpayer.

[Jim Fitzpatrick]

I do not want to be churlish and I fully welcome the commitment to Crossrail. This project has been on the stocks since about 1880. The hon. Member for Ealing Central and Acton said that it had been decades, but it has actually been planned in one shape or form for more than a century. I hope that the Minister will be generous enough to congratulate the previous Prime Minister, who ultimately grasped the nettle and said that the project must go ahead, in conjunction with the Mayor of London, the City and the CBI. I would be grateful if she updated us on the time frame for the completion of the branches of Crossrail to Shenfield, Maidenhead and Abbey Wood. I am not sure whether it is on track to meet the time scale mentioned by the Secretary of State this morning.

We oppose the Government’s decisions on fares. They have made two decisions that we believe will drive people off the railways and back on to the roads, increase congestion and hit competitiveness and growth. First, they chose to reverse the decision that Labour took in government to require train companies to apply fare limits to all fares equally, rather than hike some significantly and offset that by making smaller reductions on others. This week, we have seen the result of that change, with commuters being stung by rises of well over 10% on some routes, just at a time when families are being squeezed by wage freezes, the coming VAT increase and cuts to tax credits and child benefit.

Secondly, the Government decided to make things even worse for rail passengers by allowing fares to rise by 3% above inflation. Since 2004, the cap on increases to regulated fares has been RPI plus 1. From 1999 to 2003, it was RPI minus 1, and from 1995 to 1998, it was equal to RPI. The Secretary of State keeps claiming that increases across the CSR period will be only 10%. By our calculations, RPI plus 3 delivers a cumulative increase of more than 30% on the inflation forecasts of the Government’s Office for Budget Responsibility. The Secretary of State’s constituents will see their annual season ticket from Weybridge rise from £2,272 to more than £3,000. As shadow Secretary of State for Transport, the Minister warned that such a rise would price people off the railways. Her Department has confirmed that it expects that passengers will opt for other forms of transport. That is a betrayal of passengers by the coalition, which said in its programme for government that it was

“committed to fair pricing for rail travel.”

It is an even bigger betrayal by the Liberal Democrats, who pledged a real-terms cut in rail fares in their manifesto.

Not only rail passengers but bus users have been hit by Government. The cut to the bus service operators grant, which has been mentioned by several hon. Members, will have a devastating effect on many local bus services, particularly in rural and remote areas, which will not survive without subsidy. The BSOG is a subsidy to bus operators that covers most of the cost of fuel duty. It helps operators to keep fares down and to continue running less profitable or unprofitable services. According to Department for Transport figures, without BSOG we would see a 6.5% increase in fares and a 6.7% fall in bus usage. The social and economic effects would be even greater. With more services becoming unprofitable, more would be taken off the road.

The Government are telling people to get on the bus to find work, but people have to be able to afford to do so. The impact of this cut will be felt especially by those who are out of work and looking for a job. Two thirds of jobseekers do not have a driving licence or access to a car. Research by the social exclusion unit discovered that 38% of jobseekers found that transport was a major obstacle to finding work. People should be getting on the bus to find a job, but there must be a bus there in the first place.

The impact of the CSR settlement on local transport spending will soon be felt by the public. Labour doubled investment in local transport between 1997 and 2010 because we understand how vital local transport schemes are to reducing congestion, to making city and town centres more accessible, and to the creation of local and regional economic growth and jobs. The £309 million a year cut to local transport grants will be followed by significant cuts throughout the spending review period of 28%.

The Secretary of State has cut the number of transport grant schemes from 26 to four under the guise of simplification. We support making the system simpler, saving councils time and money on bids to different funding streams, but he knows that the cut is being used to disguise the significant reduction in the funds available to local government.

Road schemes are being hit hard. We were clear that we would have had to make reductions in the road budget. The Government, however, have pushed back many schemes that we would have taken forward, and even the money allocated to fund the schemes that have been given a green light will require major cuts of, on average, 25%.

Finally, there is real concern at the impact of the cuts on road safety. Cuts to road safety grants to local authorities were part of the Department for Transport’s in-year savings announced in May—£17 million from the road safety capital grant and £20 million from the road safety revenue grant. Following the reform of transport grants to local government announced in the spending review, there is now no specific grant funding for road safety.

Local authorities, facing cuts to their budgets of a third, will be under pressure to cut the funds for road safety and for speed cameras. Only this week, research has shown that 70 more people will die and 700 more will be injured if speed cameras are removed. It is staggering that the Government have admitted, in answer to a parliamentary question this week, that they carried out no assessment of the impact on road accidents and deaths of the decision to cut road safety grants and to end funding for speed cameras.

We have not seen so far the publication of an updated road safety strategy—a parliamentary answer that I received this morning said that it would be published early in the next year. As my hon. Friend the Member for Liverpool, Riverside, the Chair of the Select Committee, remarked, we have seen a gradual and significant 20-year decline in the number of deaths and serious injuries on our roads. I hate to say it, but that trend is in jeopardy as a result of some of the decisions.

On aviation, the coalition is poised to add further increases to air passenger duty. Does the Minister realise that adding air passenger duty to the cost of a visa from, for example, China, means that the cost of visiting the UK will be £612?

[Mrs Villiers]

Does the hon. Gentleman appreciate that the increases to air passenger duty which have just been implemented were legislated for by his Government? They are his decisions. How can he criticise us for going ahead with them?

[Jim Fitzpatrick]

The increases that were being introduced—further increases are being considered—are not being introduced in the way that we planned.

My point is that, if we add the cost of APD to the cost of a visa from China to the UK, it comes to £612, compared with £212 to go to Paris, flying economy. Flying business class, it costs £952 to London, compared with £332 to Paris. Might that explain why France received 688,000 Chinese visitors in 2008, when the UK only managed 108,000?

Will the Minister take that message to the Prime Minister? His recent mission to China was important, and we fully supported it, but to ensure that it is the Chinese destination of choice the UK must be as attractive as possible. Those figures seem to undermine the recent visit and the message that the Prime Minister took to the Chinese Government that UK plc is open to business—the strong message is that the Chinese should come via Paris, because it is much cheaper.

I will not raise the issue of aviation capacity in the south-east again, other than to say that our only international hub losing out to Charles de Gaulle, Frankfurt or Schiphol will act as another disincentive for business people to come to London. Given that Dubai now has six runways and offers access to the Americas for people from India and further east, we need to ensure that the UK is as accessible as possible, to attract those people.

[Mrs Villiers]

Can the hon. Gentleman set out his party’s position on a third runway at Heathrow? Is Labour for it or against it?

[Jim Fitzpatrick]

The Minister is teasing me. She knows full well that we just lost a general election on a policy of an additional runway at Heathrow and that my new leader—who, as the hon. Member for Cheltenham (Martin Horwood) mentioned earlier, had a particular view when Secretary of State at the Department of Energy and Climate Change—has announced that we are reviewing all our transport policy. I do not accept, by the way, that the methodology was flawed, although I accept that it has been upgraded and improved—“flawed” suggests that there was some skulduggery somewhere, which I do not buy in any way, shape or form.

The last question on aviation hubs is whether the Minister is worried that Brussels might be happy for Heathrow to lose its international hub role in favour of other parts of Europe.

--- Later in debate ---

[The Minister of State, Department for Transport (Mrs Theresa Villiers)]

It is a pleasure, Mr Gray, to serve under your chairmanship. I am delighted that the Backbench Business Committee chose to put this debate on the agenda, and I pay tribute to all who have taken part, especially the Chairman of the Select Committee on Transport, the hon. Member for Liverpool, Riverside (Mrs Ellman), and I thank the hon. Lady for her cogent and thorough introduction to the important issues that we have been debating this afternoon.

On 20 October, my right hon. Friend the Chancellor set out the coalition Government’s four-year plan to tackle the most urgent issue facing Britain today—mending our public finances and putting them on a sustainable footing. Several Members, including my hon. Friend the Member for Pudsey (Stuart Andrew), said that the situation that the Government inherited from our predecessors has put us in an extremely difficult position. Left unchanged, the spending position that we inherited would have seen Britain paying out £70 billion a year by the end of this Parliament, which is more than we spend on educating our children and defending our country put together.

We heard from the hon. Member for Liverpool, Riverside that, as part of the CSR settlement, the Department for Transport will reduce overall spending by 15%. Savings of 21% will need to be made from resource budgets, and 11% from capital. There is no doubt that cuts on that scale mean that difficult choices will have to be made. We very much wish that we did not have to make them, but the reality is, as many Members have acknowledged, that transport has come out of the spending review in a far stronger position than many expected. Among those who made that point were the hon. Member for Cheltenham (Martin Horwood) and my hon. Friends the Members for Pudsey, for Thurrock (Jackie Doyle-Price) and for Ealing Central and Acton (Angie Bray).

The Government want to break away from the recurrent pattern of spending squeezes of past years when, more or less inevitably, the axe fell first and hardest on transport infrastructure projects. As my hon. Friend the Member for Milton Keynes South (Iain Stewart) acknowledged, transport has been given a high priority in the spending review, which reflects the economic benefits that can be generated by investing in our transport infrastructure. Cutting waste, reforming the welfare system and scaling back lower priority programmes has enabled us to prioritise spending in order to boost long-term economic growth. That includes an extensive programme of investment in the nation’s transport infrastructure. As the hon. Member for Cheltenham said, it also recognises the importance of addressing climate change by supporting programmes to decarbonise mobility and travel.

I turn to a matter that was of huge importance to many who spoke this afternoon, albeit from different perspectives. That, of course, is balancing the needs of the various parts of the United Kingdom. My hon. Friend the Member for Cleethorpes (Martin Vickers) made a passionate plea for priority for north Lincolnshire and for the needs of peripheral regions. As ever, my hon. Friend the Member for Pudsey made a case for Yorkshire; those of my hon. Friends who represent Yorkshire constituencies always make articulate representations in transport debates. My hon. Friend the Member for Ealing Central and Acton pointed out the benefits that can accrue to the whole of the UK through investment in the capital’s infrastructure, as it is a major generator of economic growth.

We have a clear commitment to rebalance our economy; we are committed to addressing the north-south divide; and we are clearly committed to dealing with the challenges faced by regions such as the north-east, which have a particularly strong dependence on jobs in the public sector. In making our decisions on transport spending, we sought to take account of those priorities and commitments, as well as the competing needs of the different regions. We can never come up with a solution that pleases everyone, but we have made great efforts to be fair, and we are proceeding with a number of major schemes in the English regions, many of which are in the north.

The hon. Member for Liverpool, Riverside rightly emphasised the importance of local involvement in prioritising transport projects. It was not possible to get the entire local enterprise partnership decision-making process up and running in time to influence and inform the decisions that we had to make in the CSR. We have to get on with those projects, as many have argued. We could not stand still and wait for the new structures to be created, so we depended on the advice of the older structures—the regional ones. When taking future decisions on transport priorities, we will seek to engage with local stakeholders and LEPs as soon as practicably possible. We cannot just wait for five years and not engage locally. As soon as the LEP structure is up and running, we will seek to engage LEPs in our transport decisions.

[Jim Fitzpatrick]

Forgive me, I should know the answer, but do LEPs cover the whole country, or only parts of it?

[Mrs Villiers]

I understand that all local authorities will have the opportunity to set up LEPs, but I am not an expert in how the process works. As has been acknowledged, there is a good case for LEPs getting together, so that we can consider transport matters across a wider area. It obviously makes a great deal of sense to consider units such as travel-to-work areas, which may be considerably larger than the LEP areas themselves. LEPs working together will be constructive.

[Mrs Ellman]

I thank the right hon. Lady for attempting to answer my question. Will she acknowledge that there is still a major problem in that LEPs have not been formed in many parts of the country? When the Committee visited Hull, local businesses expressed grave concerns about the inadequacy of the LEP structures. Although she states that her Government will not wait until the end of this Parliament to set up an appropriate structure to deal with transport issues, can she give me any timetable for when she will be able to do so? After all, if she decides to destroy one structure, she should have a better one already in place.

[Mrs Villiers]

As soon as LEPs are up and running, we will engage with them about our decisions on transport projects. If there are gaps in the LEP map, we will engage with the local authorities in those areas that are not covered by LEPs and take on board their views and concerns.

The hon. Member for Cheltenham mentioned reform of the appraisal system. As he acknowledged, we have made efforts to reform the New Approach to Appraisal system to put a more realistic price on carbon, and to address the anomalous emphasis on additional fuel duty revenues for the Exchequer being discounted from the overall cost of the project. Further reform is planned, but it is important to reform the system so that we have a more realistic assessment of the carbon impact of different transport choices because we want to choose the projects that are consistent with our climate change goals.

The Chairman of the Transport Committee expressed concerns about emergency towing vehicles. Ship salvage is a commercial matter between a ship’s operator and the established salvage industry, and we have every confidence that there is capacity in the salvage industry to support ships in difficulty from September 2011 at commercial rates.

As for rail, it is very clear that we have had to take a difficult decision on fares. Of course, I wish that we could have avoided that, but the scale of the deficit that we inherited severely constrains our choices. Without the three years of retail prices index plus 3% increases that we announced, it simply would not be possible to deliver vital capacity improvements that passengers need.

The hon. Member for Liverpool, Riverside emphasised the importance of rail services in tackling climate change; I agree and that is why we have made such a major commitment to investment in rail. She also emphasised the importance both to passengers and taxpayers of getting value for money from the railways. She asked me to pre-empt the publication of the McNulty review. I had better not do that, but she will appreciate that one of the key problems that has been identified across the industry is the mismatch between incentives. Aligning incentives more effectively between the train operators and those responsible for maintaining and running the tracks is one possible way in which we can start to reduce costs in the rail industry and put our railways on a more sustainable financial footing. That is essential if we are to deliver value for money for passengers.

The hon. Lady also called for more transparency around fares; there is scope for that. Greater efforts are under way to ensure that consumers know exactly what deals are available. Increasing consumer understanding of the range of rail fares is an important goal. She also recognised that some fares are considerably lower than in past years. That is not something that one would recognise from reading the papers, but lower fares are out there, and increasing numbers of passengers are taking advantage of them. That said, we understand the concerns of many commuters about rail fares. As I have said, we have been forced into a difficult decision by the deficit that we inherited.

We have seen a shift in departmental priorities. Rail has come out much better from the spending review than other transport programmes. The programme of rail capacity upgrades is extensive—arguably, the most extensive in modern history. Crossrail is going ahead according to its original scope. Despite all the scare stories, there has been no announcement that the limbs will be amputated. We expect services to be phased in from 2018 across the Crossrail network. Savings worth some £1 billion have been identified through addressing risks and undertaking an engineering-led review of the most cost-effective way to deliver the central section, including lengthening the delivery time by around a year. We continue to work with Crossrail Ltd, the Mayor and Transport for London to optimise the scheme’s value for money.

My hon. Friend the Member for Ealing Central and Acton emphasised the importance of pressing ahead with work on the new stations. I am pleased to hear that she will be able to see the station designs for Ealing Broadway soon. Our goal is to keep up the pressure to ensure that we meet the delivery timetable that has been set.

The Chairman of the Transport Committee expressed concern about the position of TRANSEC and the budget allocated to transport security. There will be reductions of 25%, but it is well worth emphasising that the total industry spend on aviation security is more than £350 million. The bulk of the spending on aviation security is made by the industry because it delivers aviation security on the ground. She will appreciate that the 25% reduction that was discussed in the Committee yesterday relates to departmental activity, which is the overview, the policy, and the regulatory and supervision aspects. The savings are deliverable without compromising security outcomes. We recognise that maintaining passenger safety and security is of paramount importance. Administrative reform and reorganisation—rationalising certain training programmes, having to target our research programme and reducing some of our network of aviation advisers around the world—will enable us to deliver those savings without compromising passenger security.

[Jim Fitzpatrick]

Will the right hon. Lady confirm that the 25% savings will not have a negative impact on security because of redundancies or early retirements?

[Mrs Villiers]

The shadow Minister makes an important point about the reductions in head count that need to be made not just at TRANSEC but across the board. In making those decisions, it is a top priority to keep hold of the people whose skills are most vitally needed. That is the case with TRANSEC and across the Department.

Subject to the outcome of a rigorous and comprehensive consultation, our plan is to proceed towards construction of a new high-speed rail line, connecting London and Birmingham, and then on to Manchester and Leeds. My hon. Friend the Member for Milton Keynes South emphasised the importance of getting the route right; I completely agree with him, which is why we will have an extensive consultation. He also talked about the importance of getting right the connections to airports; I agree on that and work is under way on those issues. We need to look at not just Heathrow but Birmingham airport and then Manchester airport to see how we can connect them effectively to the new high-speed rail network.

The hon. Member for Liverpool, Riverside emphasised the importance of ensuring continued investment in the conventional network alongside high-speed rail; I agree and that is what we have committed to do. The coalition has also confirmed £2.1 billion to fund Network Rail’s station improvement programme, which includes £650 million to complete the work on transforming Birmingham New Street into a gateway worthy of the UK’s second city.

Schemes are also going ahead to improve the passenger experience at King’s Cross and Gatwick airport stations. The funding has been confirmed for the works under way at Reading, which will improve reliability across the whole of the Great Western main line. Work on the Midland main line will deliver faster and more reliable journeys in the east midlands and South Yorkshire. Improvements on the east coast main line will improve journeys in the north-east and Scotland.

Funding has been confirmed for vital rail freight improvements between Southampton and the west coast main line, and between Felixstowe and Nuneaton. I welcome the support from the hon. Member for Liverpool, Riverside on that issue.

[Jim Fitzpatrick]

I just wanted to ask the right hon. Lady about the impact of the changes at TRANSEC on ports. Obviously, most people associate TRANSEC with aviation and airports. There is no specific reduction in respect of that transport mode. Regarding shipping and interconnectivity, can she tell us what the spend is for upgrading the freight lines from ports?

[Mrs Villiers]

Regarding the changes at TRANSEC, in making the efficiencies that we have to make, of course we will fully take on board any impact on ports and shipping. Obviously, the bulk of TRANSEC’s work and the bulk of its funding tends to be focused on aviation, but that does not mean that we should underrate the importance of ensuring that we maintain high levels of security for our ports and shipping, too.

Regarding the rail freight upgrades, we are committed to carrying forward work on the strategic freight network. I always think that that is one of the programmes on which the previous Government did some of their best work. There was a lot of engagement with the industry to focus on those upgrades that would have the biggest economic impact and that would have the most impact on taking freight off the road and on to rail.

The comprehensive spending review announced electrification of the railways between Preston, Blackpool, Manchester and Liverpool. Work will also go ahead to improve journey times on the crucial route between Liverpool, Manchester and Leeds. The hon. Member for Liverpool, Riverside asked me to ensure that careful monitoring was undertaken to ensure delivery. Of course it is absolutely right that she should ask that and I know that the Office of Rail Regulation will be very focused on keeping Network Rail to its timetable. She also asked if electrification would be accompanied in due course by new rolling stock. Yes, of course—there is no point electrifying a railway unless there is some rolling stock to use on it. So that improvement will be part of the improvements that we want to see in the north-west.

This morning, the Secretary of State informed the House that funding for Thameslink had been confirmed. Thameslink will virtually double the number of north-south trains running through London. To reduce risks, we have lengthened the delivery programme, so completion is now expected in 2018. My right hon. Friend also gave the green light for the addition of 650 carriages, which will address some of the worst overcrowding hot spots around the country. Those carriages will be in service by March 2014 and they are in addition to the 800 net additional carriages for Thameslink and for Crossrail.

Several points were made in the debate about rolling stock; I think that we heard from several hon. Members about the importance of introducing more rolling stock. I listened with interest to the references to discussions on the Leeds trolley bus by my hon. Friend the Member for Pudsey. I am not able to give him a “yes” today, even though it is his birthday, but he has made his representations very strongly. I also took on board the statements he made about the Leeds rail proposal, which includes Kirkstall Forge. Officials at the Department for Transport will continue to work with the sponsors and the local authorities to see how best we can make progress on that proposal. He will appreciate that it is one of those schemes that is in with a chance of funding, and we will certainly do our best to work constructively with the people who I know passionately support the project.

This morning, the Secretary of State also confirmed a programme of electrification on the Great Western line between London, Didcot, Oxford and Newbury. An announcement on the extent of further electrification on the Great Western line will be made in the new year, alongside our final decision on the inter-city express programme. My right hon. Friend confirmed to the House that we have ruled out wholesale refurbishment of the High Speed 2 inter-city 125 fleet as the solution to the IEP problem. We will buy a new inter-city train fleet. After careful consideration of the Foster report on the IEP, the Government have narrowed down the options to just two: first, Agility’s revised proposal for a fleet of electric and bi-mode trains; and secondly, procuring a fleet of electric trains that would be hauled by new diesel locomotives at the end of the electrified network. I want to emphasise that both these options allow us to retain through journeys to destinations beyond the electrified network, including through journeys to Inverness and Aberdeen, which I know will be warmly welcomed by colleagues, including the hon. Member for Cheltenham who mentioned such journeys in his remarks.

I turn now to the points made this afternoon about roads and local transport. We propose to drive efficiency and reform at the Highways Agency by appointing a non-executive chair and a performance-monitoring group. Our goal is to reduce the cost of delivering a national road network that is in a safe and serviceable condition, and to deliver a more efficient traffic officer service that prioritises traffic management.

The Chairman of the Select Committee specifically referred to the A14 and her concern was that we had essentially sent that project back to the drawing board. I think that the cost of the project had simply got out of control. We were not convinced that it was the best way to deal with the problems on that transport corridor. We need to think more imaginatively about those types of programmes, to see if there is a more cost-effective alternative, and I think that the work that we are doing on the rail freight routes between Felixstowe and the west Midlands will also make an important contribution to addressing issues around the A14.

[Jim Fitzpatrick]

I will give the right hon. Lady another opportunity to have a sip of water. She mentioned that a more efficient Highways Agency will look at trying to achieve better traffic management. Does she accept that the other major role of the Highways Agency is about traffic safety, particularly in relation to foreign heavy goods vehicles? They have been a big concern to the Transport Committee and to colleagues right across the country. The enforcement regime at the Vehicle and Operator Services Agency allows these vehicles to be pulled aside, and the new regulations that we introduced only last year allow these vehicles to be impounded and not moved without either the necessary repairs being effected or insurance documentation and other documentation being produced. I hope that she is not saying that that regime will suffer as a result of moving the emphasis to road management as opposed to road safety.

[Mrs Villiers]

I will come on to road safety in a moment, but it remains an extremely high priority for the Government. However, the shadow Minister makes a key point about the importance of enforcement in relation to overseas-run HGVs. We will continue to put a priority on those enforcement mechanisms. I cannot give him the precise figures. Across the board, we will be looking to do things in a more efficient way, but if we can, we will prioritise resources to help us to deal with that very significant problem—I agree with him that it is a major problem.

The hon. Member for Liverpool, Riverside also asked whether there was a departure from road-widening and building towards more of a traffic management approach, including a managed motorway approach. I think that there is some truth in that. We want to make greater use of a managed motorway programme as a more cost-effective way to deliver more capacity. Regarding road improvements, our focus is on trying to target the worst traffic bottlenecks, because remedying those bottlenecks will deliver the greatest economic benefit. So we recognise that making better use of our existing road capacity should be a very important part of our strategy.

We also need to look, in a balanced way, at whether we can address a transport problem by using a public transport outcome. We need to look afresh at the way that we approach the national roads programme overall.

The Chairman of the Select Committee also expressed concern about cuts in the budget allocated to road maintenance. We are continuing to allocate very significant funds to road maintenance at both a national and local level. However, we recognise the need to deliver more for less. Safety is, of course, paramount. However, the road network is one of the nation’s most valuable economic assets, so we must ensure that we spend appropriately to maintain it in a good condition. Nevertheless, we feel that better commercial management and better contracting can lead to considerable savings, and we feel the same is true of making the most of collective national buying power, encouraging local authorities to link up together so that they can build their buying power, and reviewing some of the technical standards to extend the life of assets. All those methods are ways to cut costs without compromising safety.

However, there is no doubt that we have had to take some difficult decisions about spending on both local and strategic roads. To help local authorities to deal with spending reductions, we will cut red tape to give them more freedom to make their own decisions. We are carrying out a radical simplification and reform of local transport funding. Our plan is to move from 26 grant streams to four, beginning in 2011-12. That will include £560 million for local sustainable transport projects, including Bikeability cycle training.

Several hon. Members discussed buses. The hon. Members for Cheltenham and for Liverpool, Riverside expressed concern about the reduction in the bus service operator grant commencing in 2012-13. I understand their concerns; that was probably one of the most difficult transport decisions in the CSR. I hope that they recognise that the reduction is far less severe than many predicted. We argued the case passionately with the Treasury. We recognise how crucial bus services are to people on a wide range of incomes and in a wide range of areas, which is why we put the case so strongly in the CSR in order to get a fair outcome on buses.

[Martin Horwood]

I acknowledged in my remarks how well the Department had done in defending the bus service operator grant relative to expectations, but the Minister will recall that the combined impact of the cut in BSOG, the funding arrangements for the concessionary fares scheme and the cuts in local government spending could have a high-risk effect on bus services, particularly rural ones.

--- Later in debate ---

[Mrs Villiers]

I appreciate that the position on buses is affected by decisions made about Department for Communities and Local Government funding. We are happy to work with DCLG to minimise the ultimate impact on bus passengers. We have also committed to retain the concessionary fares statutory entitlement. In implementing administrative savings—a programme that we inherited from the previous Government, who also committed to reducing the cost of administering the scheme—we will, of course, seek to ensure a fair outcome for both local authorities and bus passengers.

The hon. Member for Cheltenham emphasised the importance of Oyster-style ticketing on bus services outside the capital. The Government agree fully, which is why we have committed to extend smarter ticketing technology across the country and accelerated the plans that we inherited from the previous Government.

I assure the Chairman of the Transport Committee that road safety is an extremely high priority for this Government. We welcome the progress made in recent years; it is a major achievement by the Government of which the shadow Minister was a member. We are determined that that progress will continue. Concern was expressed about the in-year savings to local authority funding. The revenue stream associated with road safety has been reduced, but it was selected because that was a way to give local authorities the greatest flexibility in how they make reductions. It was also a way to prevent the in-year savings from falling disproportionately on local authorities; that was one of the most even-handed ways to make the reductions. With the withdrawal of ring-fencing, it is up to local authorities how they implement those savings. We hope that they will continue to focus on road safety and make the savings that they need in other ways: for example, through efficiency savings.

[Barbara Keeley]

I do not know whether the Minister is aware that in the Chamber this morning, we discussed the fact that some local authorities are facing grant reductions next year of 29%, 30% or 35%. Does she really believe that those authorities—particularly urban metropolitan authorities in the north, some of which are represented here—will have any flexibility?

[Mrs Villiers]

It is our intention to give them flexibility so that they can make decisions in the local interest. Given the huge importance of road safety to local communities the length and breadth of the country, I am absolutely confident that local authorities will continue to put an extremely high priority on road safety spending.

We will continue to invest in our road and local transport infrastructure. The spending review confirmed that more than £400 million will be devoted to the uptake of ultra low-carbon vehicles in order to comply with our commitments on climate change and the pressing need to reduce emissions from driving. In his CSR statement to the House, the Chancellor confirmed various important road programmes, including the A11 dualling programme at Thetford, which will generate major economic benefits for the whole of East Anglia and provide the missing link of dual carriageway to connect Norwich to the rest of the country. That got the biggest cheer of the comprehensive spending review debate. On 26 October, the Secretary of State announced a further 16 large-scale road and public transport projects, as well as a fund of more than £600 million for other schemes to be selected from a pool through a bidding process.

Several individual schemes have been referred to, including the Leeds trolley bus, on which work will continue, as I said. I hope that it will be possible to make progress on the scheme. The hon. Member for Worsley and Eccles South (Barbara Keeley) spoke with eloquence about her concerns for the M60 and its impact on her constituents. I emphasise that safety issues are, of course, taken into account in decisions on which schemes to fund, and both safety and the environmental impact on communities will be explored fully in the planning process, as is appropriate. That is how we ensure that such issues are addressed. I am concerned to hear about the problems that she believes have arisen with the consultation, and I urge her to take it up with the Highways Agency.

[Barbara Keeley]

I thank the Minister for giving way. The Roads Minister was going to meet me and local residents in my constituency to understand the issues that I have raised, and I have stated that the Highways Agency consultation was a mess. Given that and the fact that the scheme’s start date is now later than originally proposed, although still before 2015, will the Minister take back a request to review the matter further? I do not think that the scheme is value for money, and it is competing with schemes that are much more wanted and more certain to deliver value for money.

[Mrs Villiers]

With all such schemes, the process of assessing value for money is ongoing. The scheme is conditional on the planning process, which is the proper opportunity for the hon. Lady’s constituents to make their voices heard and express their concerns about what will happen. It is not for me to pre-empt the planning process in this debate.

Several hon. Members mentioned the Dartford crossing. The hon. Member for Cheltenham was concerned about the nature of the charges. They were converted by the previous Government to congestion charges; the charges originally imposed related to the construction costs of the bridge. My hon. Friend the Member for Thurrock expressed her concern about the increase in tolls. Again, that is unfortunately another melancholy consequence of the fiscal crisis that we face. Tolls could help us fund a new crossing, which, as the shadow Minister said, would generate significant benefits to the economy and relieve congestion. We continue to work to address the congestion problems and flow of traffic on the Dartford crossing, and that work includes a commitment to lifting the barriers in extreme cases where they are causing congestion.

My hon. Friend the Member for Thurrock also expressed concerns about junction 30 of the M25. As I emphasised, the project has not been cancelled but postponed. There is a good chance that it will go ahead, and the Highways Agency will continue to work on that. She has put on record her concerns about how important it is, not least because of the need to transport Hellmann’s mayonnaise and Fairy liquid around the country. She is no doubt a strong campaigner for the interests of her constituent.

[Jim Fitzpatrick]

I intervene only because one group of constituents who have not been mentioned are long-suffering West Ham fans from south and west Essex, who must fight their way across the M25 to get to Upton Park every other Saturday.

--- Later in debate ---

[Mrs Villiers]

The hon. Gentleman puts that representation well. I am sure it will be duly taken on board as the scheme progresses.

My hon. Friend the Member for Stroud (Neil Carmichael) and the hon. Member for Cheltenham expressed anxiety about the fate of the Swindon-Kemble project. The hon. Member for Cheltenham said that it could end up with the dubious label of being the only rail project cancelled by this Government. In reality, the funding was never in place from the previous Government. It was never confirmed. I believe that the business case is good and that it would be great in terms of increasing the resilience of services to Wales. There are all sorts of good reasons to do the project, but at the moment it just does not look affordable. However, there is every chance that we could seek to take it forward in the next Network Rail spending control period.

[Martin Horwood]

Will the Minister give way?

[Mrs Villiers]

I shall carry on; otherwise the Committee Chairman will not have a chance to speak at the end.

The shadow Minister, the hon. Member for Poplar and Limehouse (Jim Fitzpatrick), expressed concern about type 26 frigates. I will certainly take that back to my colleagues in the Department. I have noted his concern about the impact that that might have on piracy. That is obviously a crucial issue we need to address today. He also asked when a road safety strategy will be published. It will be published in due course at some point in the new year. I was somewhat surprised by his comments on air passenger duty because, as I pointed out to him, the increases about which he is concerned were set out in the Labour Chancellor’s Budget and implemented through a Finance Bill that was enacted during the term of his Government. He has had something of a road to Damascus conversion on APD.

I have already dealt with the hon. Gentleman’s points on TRANSEC and the personnel there. He also made the valid point that ports and shipping often do not get the attention they deserve, given their huge importance to the economy. I certainly agree. Whether or not we are in government, it is vital that we recognise the importance of our history as a maritime nation and the economic benefits generated by ports and the shipping industry.

In conclusion, faced with the scale of the deficit we inherited, the easy option would have been to slash capital spending on transport projects. We have chosen not to do that; we have chosen to look at the long-term interests of the economy. That is why, over the next four years, we will spend more than £30 billion on road, rail and local transport projects across Britain, despite the dire financial situation that we inherited from our predecessors. I thank everyone who has taken part in this very interesting debate.

High Speed 2

Theresa Villiers Excerpts

Tuesday 23rd November 2010 Westminster Hall

[The Minister of State, Department for Transport (Mrs Theresa Villiers)]

In the brief time that I have available, I will try to run through the points made by right hon. and hon. Members, and I will write to them about any points that time prevents me from covering now.

I am very grateful to have support for high-speed rail from across the House, across parties and across the country. That support is very welcome. There was a particularly vocal presence in the debate today from Yorkshire, which was particularly welcome.

However, we recognise that it is vitally important to think with great care about the local environmental impact of the project. Of course, we had some very comprehensive accounts of the potential impact, first from my hon. Friend the Member for Wycombe (Steve Baker) and then from my hon. Friend the Member for North Warwickshire (Dan Byles). It is important that they are here in Westminster Hall and able to put their constituents’ point of view.

I strongly believe that careful mitigation measures can eliminate the most intrusive local impacts of high-speed rail. Modern engineering techniques give us an expanding range of ways to use sensitive design to make transport infrastructure easier to live with and less intrusive; a number of Members have referred to the example of High Speed 1, where that mitigation work has been done with some success in many areas.

I believe that it is possible to find a solution that is balanced and fair; that generates the significant economic benefits of high-speed rail for the country as a whole, and that is fair to the local communities that are directly affected by whatever line of route is ultimately chosen. Hopefully, this debate will take us closer to finding a solution and choosing that route.

We intend the consultation to be inclusive, wide-ranging and comprehensive, providing a range of opportunities for Members and their constituents to go through these kinds of concerns about the impact on landscapes and communities. Our consultation is designed to run for about five months, which is longer than the statutory minimum. We take this process very seriously, because we know the gravity of the concern that is felt in some communities.

The business case for high-speed rail was discussed by a number of Members. We are absolutely confident about the very significant benefits that a line from London to Birmingham would generate and we believe that those economic benefits are even more significant when they are linked to a “Y”-shaped high-speed rail network that connects the capital with Birmingham, Manchester and Leeds.

I welcome the comments of my hon. Friends the Members for Warrington South (David Mowat) and for Calder Valley (Craig Whittaker) about the importance of using transport infrastructure to try to remedy imbalances between economic prosperity in different parts of the country. There is strong local support in much of the country for high-speed rail.

In answer to the questions from a number of Members about Scotland, as the hon. Member for Denton and Reddish (Andrew Gwynne)—the shadow Rail Minister—has already pointed out, the “Y”-shaped network to deliver high-speed rail to Manchester and Leeds could enable us to deliver journey times to London from Edinburgh and Glasgow of about three and a half hours. There is also the issue of promoting the air-to-rail switch, which is so important to the hon. Member for Cheltenham (Martin Horwood). In due course, we certainly want to see a genuinely national network built, and that is why we are in regular dialogue with the Scottish Government. We are happy to work with them on establishing how we bring that network about in the future.

A number of Members have talked about the carbon impact of high-speed rail. I believe that high-speed rail can play an important role in our plans to develop a low-carbon economy, particularly by promoting the air-to-rail switch that a number of Members referred to. Even with our current energy generation mix, high-speed rail is a much lower-carbon option than flying.

My hon. Friend the Member for Wycombe argued that the Government had overstated the expected increase in demand. He and a number of other Members sought to challenge the business case. However, there is no doubt that the benefits generated by the extension of high-speed rail to Birmingham will exceed the cost of building the line.

Furthermore, it is clear that there is already a significant crowding problem on our railways. The simple fact is that we need this new railway. Important parts of our rail network are already suffering from serious overcrowding problems. As my hon. Friend the Member for Milton Keynes South (Iain Stewart) mentioned, one only needs to go to Euston on a Friday night to see how popular the railways have become. There is simply no realistic alternative that would give us the level of benefit that high-speed rail will generate.

[Andrea Leadsom]

Does my right hon. Friend the Minister accept, however, that greater consideration should be given to using an existing transport corridor rather than tearing through great swathes of English countryside?

[Mrs Villiers]

It is always the case that, when efforts are made to construct these major transport projects, there are advantages to using existing transport corridors. However, sometimes using those existing corridors is simply not possible. Nevertheless, the Secretary of State for Transport asked High Speed 2 to look again at the route that it had proposed and at the environmental impact of that route. In a very short time, we will publish a package for consultation that will take on board a number of the concerns that have already been raised with the Government and with HS 2, to mitigate the environmental impact of the project.

I want to go back to the points that were made about using upgrades to the conventional rail network to relieve the capacity problem. It is simply not possible to relieve the capacity problem without a new line. Without delivering a further significant uplift in rail capacity, some of our key transport corridors will become even more overcrowded in the years to come. I strongly believe that high-speed rail is the best way to deliver that new capacity, not least because it would free up space on existing networks for more commuter, regional and freight services. My hon. Friend the Member for Rugby (Mark Pawsey) mentioned that issue and I think that there is potential for his constituents to benefit from the extra space on the west coast main line that will be released by high-speed rail. Dramatically improving connectivity between a number of our most important cities has the potential to change the economic geography of the country.

As for the environmental impact, I recognise that our plans for high-speed rail are already having an impact on some communities, even in advance of the final decisions on the project. That is why we have launched an exceptional hardship scheme, to assist those with an urgent need to sell their properties and move home.

The Secretary of State has made it clear that, as and when any final route is chosen, we will put measures in place to address blight, and those measures will go well beyond the requirements of statute. I say that in response to a number of points that were made about the exceptional hardship scheme. My hon. Friend the Member for North Warwickshire had some concerns about how the scheme was working. I was not aware of those difficulties, so if he wants to write to me about the specific issues I will be happy to look into them.

Earlier this year, the Secretary of State visited the line of route that has been recommended by HS 2 Ltd. He acknowledges the vital importance of designing a new high-speed rail line in a way that will reduce local impact where possible and that will take on board the types of points that we have heard this morning.

We fully recognise the need to balance the benefits of the high-speed rail project with the local impact on landscape and communities. In the summer, the Secretary of State instructed HS 2 to consider how best to improve its recommended route 3 to reduce any negative social and environmental impacts. An initial report has already been published that identifies a number of ways to reduce problems on the northern part of HS 2’s preferred route. That work is continuing in relation to a number of other areas of sensitivity—

[Mr Mike Weir (in the Chair)]

Order. I am afraid that we have run out of time for this debate. We now move on to the next debate.

National Express East Anglia

Theresa Villiers Excerpts

Tuesday 2nd November 2010 Westminster Hall

[The Minister of State, Department for Transport (Mrs Theresa Villiers)]

I join my hon. Friend the Member for Witham (Priti Patel) in saying that it is a pleasure to serve under your chairmanship, Mr Hollobone. I congratulate her on securing the debate and on presenting her case with such energy and tenacity. It gives us a useful opportunity to consider the performance of rail services on the East Anglia franchise. I pay tribute to the energetic campaign she has run to champion the interests of her commuting constituents.

I want first to outline some of the Government’s broader plans for reform of the railways, because they may help to address a number of the issues that have been raised today. Secondly, I will focus on my hon. Friend’s concerns about the works under way at Marks Tey station, and Mr Clark’s retailing stand. Thirdly, I will consider the general performance of National Express East Anglia, and fourthly, I will attend to my hon. Friend’s points about the new timetable

Just a few months ago I announced that the NXEA franchise would be extended by a little over six months. I chose to exercise the Government’s contractual right to do that to allow the outcome of our consultation on rail franchising to be taken on board in the letting of the new franchise. That extension will also enable the interim conclusions of the McNulty study on rail value for money to inform our decisions on the future of rail services in East Anglia. Of course, I urge my hon. Friend to make her views about current services known when the re-let takes place. The record of all the bidders for the potential new franchise will be taken into account in assessing their suitability to take it on.

The Government believe that we need to reform the railways to ensure they deliver better value for money. My hon. Friend emphasised that concern. Unless we get costs down, we will not be able to bring about the improvements to services and capacity that passengers want, so we are committed to reforming Network Rail. When Labour established the company, it failed to put in place sufficiently robust accountability mechanisms to ensure that Network Rail would deliver value for money and high-quality performance at the level needed for a modern and successful railway. We need to tackle that accountability gap, and to get the people running our tracks and trains working more efficiently and cohesively together. We also need to modernise the franchising system. We propose to move to longer franchises to give the private sector the certainty it needs to help us deliver vital improvements, such as better services and stations. They should also help us in providing better rolling stock, which I know is a serious concern for my hon. Friend and many of her constituents.

The reforms are aimed at moving away from a system in which Whitehall specifies detailed and prescriptive inputs into franchises. Instead, we want a stronger focus on the quality of outcomes for passengers, giving more flexibility to the professionals who run our railways to apply innovation and enterprise in working out the best way to deliver those outcomes. Let me assure the House that the outcomes we set will be demanding for the franchise my hon. Friend is concerned about and for all the rest for which we have responsibility. Operators who do not comply with franchise requirements will face sanctions, including termination of the franchise in the most serious cases. I expect our reform plans for Network Rail and franchising to get the two sides of the rail industry working more cohesively together, and to ensure that they are more responsive to passenger needs. I therefore believe they will help to address a range of the issues raised by my hon. Friend this afternoon.

As to the national station improvement programme and the works that are under way at Marks Tey, a budget of £150 million has been allocated to the programme to improve the passenger environment at about 150 medium-sized stations in the current railway control period. The improvement scheme at Marks Tey station includes the provision of a modern ticket office building and booking hall area, and a small retailing opportunity. We hope that the project will give passengers protection from the weather, which they currently lack. It will also improve staff accommodation, which is apparently in such disrepair that the station office suffers from repeated flooding. The London-bound platform will be widened to improve circulation for passengers. New waiting shelters will also be installed on that platform. The station forecourt will be redesigned to provide a passenger pick-up and drop-off area and improvements to cycle and motorbike parking.

My hon. Friend is concerned that the work under way is not the best way to deploy taxpayers’ money. Decisions on how to deploy the budget were devolved to the rail industry, but they are overseen by an NSIP project delivery board and ultimately by the rail regulator, to ensure that proper checks are kept on the way in which the rail industry spends taxpayers’ money. I am informed that national passenger survey scores were taken into account in deciding which stations were most in need of improvement, but in addition—I know my hon. Friend is a little sceptical about their value—comments from local stakeholders were taken on board. I understand that with respect to Marks Tey, a value-for-money assessment was carried out by Network Rail and NXEA. NXEA consulted a range of stakeholders, including some local rail user groups and station tenants, local authorities, rail staff and Passenger Focus. It is unfortunate that the train operator’s customer surgeries at Marks Tey took place only fairly late in the day, after most of the key decisions had been made about the shape of the upgrade programme. I understand my hon. Friend’s concerns about that, but I have received some assurance that customer feedback from an earlier point was taken on board in putting together the improvement proposals. Clearly it would have been preferable if NXEA had carried out those customer surgeries earlier.

[Priti Patel]

I would welcome an assurance that for future developments of this nature, there will be greater transparency in the consultation and dialogue with communities. It is all well and good receiving a survey and ticking a box, but there is the question of understanding the intricacies of planning and the impact on the community and businesses. That should be taken into consideration.

[Mrs Villiers]

I do not think it would appropriate for us to mandate a model for consultation, but across the board we encourage train operators to engage extensively with passengers and local stakeholders on decisions of this kind, and a range of other issues that are important for commuters.

National Express has advised my officials that passengers have commented on the queues and congestion caused by there being only one poorly positioned ticket window at Marks Tey. Passengers interchanging between the main line and Sudbury have also complained about the state of the toilets and the waiting shelters on platforms 3 and 4. However, it seems that improvement works at Marks Tey are designed to relieve those conditions.

The key issue for my hon. Friend today is the future of Nigel Clark’s newspaper and coffee retailing business. My hon. Friend has fought a robust campaign to secure the future of Mr Clark’s news stand and the service it provides to her commuting constituents. If I remember correctly, I prepared a briefing for the Prime Minister on the subject, so I know that my hon. Friend has taken the matter to the top; I am impressed by her determination. However, my answer must be the same as that which I gave in correspondence.

It is not for me, the Minister responsible for rail, or for the Department for Transport to dictate how train operators should structure retail opportunities at their stations. However, my hon. Friend knows that I have passed her concerns to NXEA, along with the petition that she delivered to me on the subject. She has put her concerns on the record, and fought a good campaign. It is for National Express and Mr Clark to resolve matters, no doubt assisted by my hon. Friend’s robust intervention. I understand that a six-month lease for a temporary unit has been agreed, although my hon. Friend has expressed some concern about its location. I hope that a longer term solution will be found in due course. I know that Mr Clark and others will have the chance to submit proposals for use of a new and permanent retail unit should they wish to do so. I hope that the matter will be resolved, and I urge both sides to find a satisfactory outcome.

I turn to the overall performance of NXEA. The latest period for which complete performance data are available shows that 90.9% of NXEA trains arrived on time. That is according to the moving annual average. However, those figures are aggregated across a diverse franchise that covers long-distance, rural and commuter services, so they do not necessarily reflect the experience of commuters using the services in my hon. Friend’s constituency. Nevertheless, as she pointed out, satisfaction with NXEA is lower than for train operators in other places, so there is clearly room for improvement, particularly in light of what she said today.

A key task for the Government and the Department for Transport is to protect the passenger and hold train operators to account for their performance, particularly in relation to some recent reliability problems. For example, in early summer NXEA suffered some significant problems with its fleet, which caused a large number of delays and cancellations. The Department took up the problem with NXEA. As a result, an emergency action plan has been adopted. Part of that plan involved hiring additional engineering staff, who were placed at Liverpool Street station to try to deal with technical faults on the spot, in order to keep the trains in service. I gather that that has had a positive impact and that fleet performance has improved considerably.

I emphasise that reliability issues on the rail network in my hon. Friend’s constituency are not solely down to National Express East Anglia. Another significant factor is the performance of Network Rail. According to the latest industry figures, approximately 70% of passenger delays on the line are caused by Network Rail or other train operators. A significant amount of work is under way to improve reliability on the great eastern main line route. Most of the overhead electrical equipment between Liverpool Street and Colchester stations dates from the late 1950s, and extensive renewal work is being undertaken by Network Rail on the Liverpool Street to Chelmsford section. That work is due to be completed by 2012, and it will provide real improvements in reliability. Problems with the ageing infrastructure are one reason for the concerns expressed by my hon. Friend’s constituents.

Every passenger dreads hearing the terrible words “planned engineering work”. However, when scheduling maintenance and renewals work, the rail industry always faces a difficult balancing act. On the one hand it needs to deliver the relevant work in an efficient and cost-effective manner; on the other it is essential to minimise disruption for passengers whenever possible. Because of the scale of work needed on the East Anglia routes, there has been a long series of weekend track possessions. No matter how much care is taken, is inevitable that possessions will cause some disruption, but on the routes in question it sometimes results from delays in Network Rail handing back possession to National Express East Anglia. If the possession overruns, the train operator does not gain access to the tracks at the scheduled time.

Such disruption can be considerable, especially for passengers facing the dreary Monday morning commute. It is such problems that we need to address in our rail reform programme; we must ensure that Network Rail becomes more responsive to customer concerns about issues such as track possessions and overruns, and that it improves its performance overall in providing an infrastructure that keeps services running. We are very focused on those reforms as well as on reforming the franchise system. The twin tracks of reform are designed to deliver the enhanced levels of improvement necessary to address the problems my hon. Friend has highlighted.

The Office of Rail Regulation is responsible for regulating Network Rail’s performance and its stewardship of the national network. In addition, I regularly meet senior representatives of the ORR and rail industry to discuss operational performance and the measures being taken to address problems. I have raised the issue of the performance of the East Anglia routes at this regular forum. In addition, officials at the Department for Transport are in regular contact with train operators to discuss service reliability; and targets for each operator are closely monitored.

The third concern raised by my hon. Friend relates to the timetable to be introduced in December. The Government are funding increased capacity for the NXEA franchise, but that has meant a significant recasting of the timetable. In order to get a timetable that maximises the efficient use of the network and ensures overall passenger benefits, a small number of stations are left with longer gaps between trains. My hon. Friend referred to two of them. Unfortunately, there is no getting away from the fact that difficult trade-offs have to be made and conflicts resolved between the various passenger groups. Efforts to get the maximum efficient use out of the network will sometimes mean that such conflicts are resolved in favour of the busier journeys.

I have listened carefully to my hon. Friend, and I emphasise that it is important that the operator endeavour to keep instances of extended gaps between services to a minimum. The new timetable was developed following extensive consultation during the summer of 2009. I have seen no evidence that the train operators acted unreasonably in making their decisions; but when the new franchise is re-let, timetabling with be considered afresh. That will give my hon. Friend an important opportunity to make further representation.

Our rail reforms are designed to make the rail industry perform more efficiently and respond more effectively to the sort of problems highlighted by my hon. Friend. Programmes to expand capacity on the East Anglia franchise and to renew and improve the infrastructure in order to ensure more reliable services are already under way. Although we had to take tough decisions on rail fares, we have made it clear that the three-year rail fare increase will enable us to deliver the upgrades that are vital to improving life for passengers and to securing our long-term economic competitiveness.

Oral Answers to Questions

Theresa Villiers Excerpts

Thursday 28th October 2010 Commons Chamber

[Jessica Morden (Newport East) (Lab)]

1. What recent representations he has received on the method of payment of tolls on the Severn bridges; and if he will make a statement.

[The Minister of State, Department for Transport (Mrs Theresa Villiers)]

The Department for Transport has recently received representations from the Wales Office about the method of payment on the Severn bridges. The Secretary of State has met the Deputy First Minister, and payment methods at the Severn crossings were discussed.

[Jessica Morden]

The facility enabling people to pay with credit and debit cards—for which I was grateful—was introduced in time for the Ryder cup, only to be whisked away again the minute the event was over. That has caused confusion. My constituents would like to pay by modern methods, which is fair enough. Can the Minister assure me that an end to the situation is in sight?

[Mrs Villiers]

I can. I know that a long-running campaign has been conducted by a number of Members.

As the hon. Lady says, the system was introduced for the Ryder cup. We considered it important to meet the deadline, given the significance of the event. The temporary scheme has been withdrawn for the moment, but is due to be back in operation on Friday next week. That gives us a chance to do some more work in order to make it more efficient, but there will be further work to make it more efficient still. We hope to introduce a system in the new year that will not require PINs. The temporary system does require them, and that causes delays and adds to congestion.

[Peter Aldous (Waveney) (Con)]

2. What steps he is taking to ensure the economic sustainability of the rail network.

--- Later in debate ---

[The Minister of State, Department for Transport (Mrs Theresa Villiers)]

The Government recognise that redoubling the railway between Swindon and Kemble could generate important passenger benefits and improve resilience by providing a diversionary route for the Great Western main line to Wales. Unfortunately, the need to address the deficit means that we are not able to commit Government funding to this project at present, but it remains our aspiration to take it forward in the future.

[Mr Robertson]

I thank the Minister for that response, but my hon. Friend the Member for The Cotswolds (Geoffrey Clifton-Brown) and I have been campaigning on this issue and on the issue of improving the A417/419 road. The absence of either of those schemes impedes travel between Gloucestershire and London, and that is detrimental to Gloucestershire’s economy. Will she revisit both those schemes as soon as possible?

[Mrs Villiers]

I am very much aware of the campaign that my hon. Friend has run, alongside my hon. Friend the Member for The Cotswolds and other local MPs, such as the hon. Member for Cheltenham (Martin Horwood). I have met a number of MPs to discuss this project and we recognise that it is a good scheme. Important work is being done through the Grip 4 study, which is due to conclude shortly. We hope that we will be able to fund this scheme, but at the moment the deficit—the significant crisis in the public finances—that we have inherited means that we cannot take forward all the good schemes that are on the table. There is no doubt, however, that this scheme will be a serious contender when we assess these schemes again in relation to the next railway control period.

[Tony Baldry (Banbury) (Con)]

7. If his Department will fund (a) tunnelling and culverting work and (b) other mitigation work arising from the construction of any future rail line as part of the High Speed 2 project.

--- Later in debate ---

[David Tredinnick (Bosworth) (Con)]

11. What proposals for improvements to the M1-M6 junction he is considering; and if he will make a statement.

[The Minister of State, Department for Transport (Mrs Theresa Villiers)]

I refer my hon. Friend to the oral statement made by the Secretary of State for Transport to the House on 26 October, and the supporting documentation. The preferred option for improving the junction is the proposal announced in February 2009 to provide free-flowing traffic links between the A14, the M1 and the M6.

[David Tredinnick]

Does my hon. Friend agree that that is one of the most dangerous junctions and one of the most important junctions on the motorway network? When does she expect the works there to be completed, and what other projects do the Government have to improve the M1 and M6 motorways?

[Mrs Villiers]

I agree that that is a very important junction on our strategic road network. That is one of the reasons why we have prioritised funding for the project at a time of intense pressure on the public finances because of the deficit that we inherited. I also agree that road safety is an important issue in this case. The Highways Agency is working hard to manage and mitigate the road safety impact of the current junction, but we believe that the scheme will provide additional long-term road safety benefits. The scheme is not likely to be able to be progressed before 2015, but we are working on a revised timetable, with a view to construction beginning some time after that period.

[Barbara Keeley (Worsley and Eccles South) (Lab)]

Another important junction that has congestion problems and very poor design is junction 13 on the M60 at my Worsley constituency, but instead of doing something about junction design and improving the safety and other aspects there, Ministers have pushed forward with a white elephant of a scheme to add another lane to the motorway at that point. I and my constituents have objected to that from the start. The additional lane will blight the lives of people who live near the motorway. Given that they cannot push ahead with the good schemes that Members have put forward this morning, I urge Ministers to cancel that stupid white elephant of a scheme, think again and use the scarce public resources where they are better utilised.

[Mrs Villiers]

I refer the hon. Lady to the statement that the Secretary of State made earlier this week on the difficult decisions that we have made to prioritise investment in the most significant traffic bottlenecks on our road network. However, she will be well aware that before all those projects proceed to completion, they must pass through the appropriate planning appraisal programme, and full consideration will be given to the local community’s views as part of that important process.

[Mr Speaker]

I call Matthew Offord.

--- Later in debate ---

[Martin Horwood (Cheltenham) (LD)]

Although we are expecting rail fares to rise only by 10% over four years in real terms, will Ministers look into changing the basis for the cap calculation from the retail prices index to the consumer prices index—because, after all, what is fair for pensioners ought to be fair enough for profit-making rail companies?

[The Minister of State, Department for Transport (Mrs Theresa Villiers)]

The decision on rail fares has been difficult, but we have had to make it as part of the tough decisions needed to tackle the deficit. Of course we will keep under review the way that the system works, and I am happy to meet the hon. Gentleman to discuss the issue.

[Chris Evans (Islwyn) (Lab/Co-op)]

T3. Constituents of mine travel on the Ebbw Valley rail line from Cardiff to Islwyn, but they cannot travel to Newport because there are major engineering works at the Gaer junction. Has the Minister had any discussions with the First Minister about providing money for those engineering works so that my constituents can travel to work from Islwyn to Newport?

[Mrs Villiers]

I have not discussed that specific issue with the Welsh Assembly Government, but I am happy to do so.

[Jo Swinson (East Dunbartonshire) (LD)]

East Dunbartonshire cycle co-operative does excellent work and has enthused hundreds of people into taking up cycling through a local cycle festival, maps, cycle clubs and even a Guinness world record attempt at the number of cycle bells that can be rung simultaneously. This shows what can be done with a group of committed volunteers and a bit of grant funding, but how can we ensure that cycling promotion is not just left to volunteer champions but is done more systematically wherever people live in the country?

--- Later in debate ---

[Rehman Chishti (Gillingham and Rainham) (Con)]

May I ask the Minister for special consideration for communities in the south-east that had RPI plus three imposed on them by the previous Labour Government in 2006?

[Mrs Villiers]

I am well aware of the concerns of users of the Southeastern franchise who have been asked to pay RPI plus three over the past few years. That was linked to investment in rolling stock, and the rest of the country will move on to RPI plus three to even out the perceived inequality from the year after next.

[Lilian Greenwood (Nottingham South) (Lab)]

On Tuesday, the Secretary of State seemed to think me most ungrateful because I did not thank him for the tram extensions. I am sorry to disappoint him, but the people of Nottingham South sent me here to do things, not just to say thanks. Does he accept that the tram on its own will not solve the problems, particularly for freight traffic, caused by congestion on the A453? It really is vital that the widening scheme goes ahead.

Mutual and Co-operative Rail Franchise Bids

Theresa Villiers Excerpts

Wednesday 20th October 2010 Westminster Hall

[The Minister of State, Department for Transport (Mrs Theresa Villiers)]

It is a pleasure to serve under your chairmanship today, Mrs Brooke.

I congratulate the hon. Member for Luton South (Gavin Shuker) on securing the debate and providing us with the opportunity to discuss an important issue, namely the potential involvement of mutuals and co-operatives in the rail franchising process. The issue is of concern to a number of hon. Members and has been the subject of a range of parliamentary questions.

I would like to make it clear that the coalition Government support the creation and expansion of mutuals, co-operatives, charities and social enterprise. We fully appreciate and recognise the brilliant work done by the co-operative, mutual and not-for-profit sector in many areas of policy and public life. In fact, we want to see such groups playing a bigger role in delivering public services and in helping us to tackle the key social problems that we face in modern Britain.

I want to be clear: the Government would treat a rail franchise bid from a mutual or a co-operative in exactly the same way as they would treat a bid from a competitor in the commercial sector. If a mutual, co-op or any other not-for-profit organisation can meet the accreditation criteria, it may bid for a franchise. If it offers the best deal for the passenger and the taxpayer, it can win the franchise. I cannot promise to bend the rules for mutuals and co-operatives, but I can promise to treat them fairly and objectively, judging their proposals on the same basis as those of their commercial competitors.

Before I deal with how the accreditation and procurement process works, I will respond briefly to the points made by the hon. Member for Luton South on Network Rail—not obviously the subject of today’s debate, but important none the less. I hope, Mrs Brooke, that you will allow me the latitude to respond.

The hon. Gentleman is right that we need to reform Network Rail. I am glad that there is growing consensus around that—before the previous general election, the Government seemed to think that there was no justification for reform, so I welcome his voice joining those of us who think that we need mechanisms to make Network Rail more accountable. He is right that we need to take care to get any reform right—we want not to rush into it, but to think carefully about the best way to deliver results for passengers and taxpayers.

I recognise and, to an extent, share the hon. Gentleman’s concerns about the Network Rail decisions on bonuses in recent months. I am pleased that the company has suspended its management incentive plan, which I hope we see reformed in the future. We are determined to make Network Rail more accountable and more efficient. Our work is informed by that of Sir Roy McNulty, and I have no doubt that our discussion today and the speech by the hon. Member for Luton South will also form an interesting part of the McNulty review.

In order to address the issues raised by the hon. Gentleman about mutuals, one first needs to consider the general rules on rail franchising. As the hon. Gentleman acknowledged, rail franchises deliver an essential service. There are 1.2 billion passenger journeys made every year. The train operating companies are, at the moment, substantial businesses—they each have a turnover in excess of £100 million per annum and they provide employment to hundreds and, in some cases, thousands of people.

The Government have a twofold interest in rail franchises. First, we need to protect the passengers’ interests and to hold train operators to the demanding obligations of service delivery placed on them by their franchise contracts. Secondly, we need to protect taxpayers’ interests, by obtaining value for money from the franchise contracts and for the considerable sums spent on the railways.

The hon. Gentleman will appreciate that, while some franchises pay a premium and others receive a direct subsidy, all operators benefit from the Government grant made to Network Rail to maintain and renew the infrastructure. He will appreciate that considerable sums are at stake when a franchise is let and that, in letting a franchise, we trust the operator with serious and important responsibilities in relation to our economy and transport system. Therefore, the greatest care is needed to ensure that we do the best that we can to make the right decisions on whom we award a franchise to.

A key issue for the hon. Gentleman was clearly the accreditation process used to assess whether a bidder can qualify to take part in a franchise competition. The Department for Transport has recently completed a consultation on rail franchising—it closed on Monday—and I take the opportunity to thank all those who took part. Until the consultation responses have been properly considered, I cannot say with certainty whether the reforms that we will undertake will involve changes to the accreditation process. Although this is not the primary focus of the consultation, we are happy to consider whether ways can be found to make the process of letting franchises less complex and expensive to carry out. Whatever reform we adopt, however, it must still ensure that the process is fully compatible with objective public procurement principles and regulations. I am sure that the debate will provide useful input for the decisions on whether reform to the accreditation process is needed, to be considered alongside the consultation responses.

The procurement process has two main elements: first, accreditation; and, secondly, the formal bid stage. The appropriateness of potential bidders is considered at the first stage. The accreditation process is designed to achieve a manageable field of bidders, which can be expected to submit attractive, competitive and realistic proposals. Keeping the number of operators that can proceed to the formal bid stage to a manageable number reduces cost for Government and industry. The winning bidder must be capable of delivering a high-quality service at the price it has undertaken to pay. The procurement methodology needs to comply with European Union procurement law and treaty principles, including equal treatment, proportionality and transparency.

The legal entity signing the franchise agreement is required to be a limited company formed for that purpose, but the accreditation process assesses the financial standing and technical capability of the parent organisation, so it would be open to a mutual or co-operative to establish a special purpose vehicle in order to run a franchise in the same way as commercial parent groups do now. Bidders are assessed to ensure that they have a level of financial standing proportionate to the size of the franchise concerned, in order to provide assurance as to the stability of the potential operator. The Government need to be confident that each bidder will have sufficient financial capacity to meet the working capital needs of the franchise business. We need to assess with great care whether the bidder will be able to absorb the risks that we seek to transfer to it, which at the moment means obtaining the performance bonds that the Department needs as security in the event of a franchise default.

The hon. Gentleman has made a passionate plea on behalf of co-operatives and mutuals. I value their work, but I would be very reluctant to compromise on rules that require us to make a careful assessment of the financial capacity of those that bid for rail franchises, because of the accompanying potential risks. Having said that, we are looking at the whole process of the franchising system as part of our response to the consultation. A key aim of the franchising process must be to protect the interests of passengers and taxpayers, so it is essential that we have safeguards in place to avoid letting the contract to an organisation that, ultimately, finds that it cannot cope. The most recent example of franchise collapse, that of National Express East Coast, shows that it is possible to deal with that situation without disruption to services. However, such collapses are clearly unsettling for passengers and the work force, and leave the taxpayer with the considerable cost of stepping in to run the railways as the operator of last resort.

I hear what the hon. Gentleman says, but financial credibility checks and standards are important, and likely to become even more so in the future as we move to longer franchises, as proposed in our consultation. We will need to make longer-term judgments on the credibility of bids and on the capacity of the potential franchisee to deliver major investment, which we hope will make a considerable difference to the quality of experience for passengers under the proposed new franchise model.

I turn now to the hon. Gentleman’s questions about the experience assessed when looking at franchise bids. The current rules require bidders to demonstrate a track record of operating transport systems, not necessarily in rail. Recent competitions have said that it should cover a period of at least two years. However, a completely new organisation might be able to meet that requirement by showing that its management team and work force have such a record. The issues discussed by the hon. Gentleman could be taken on board in the assessment of whether the potential bidder had the right track record to give us confidence to take their bid seriously.

A new and small organisation may have less experience than other bidders and will, therefore, find it harder to get through this stage, especially if it is interested in one of the larger, more complex franchise opportunities. My officials have an open door policy for people who want to get into the rail franchise market. I am happy to meet the delegation from ASLEF that the hon. Gentleman mentioned. It is useful to put it on the record here that if there are others—whether they are commercial operators, mutuals or not-for-profit organisations—that are interested in bidding for a rail franchise, we are willing to talk to them, and my officials are happy to advise them on how to grapple with what everyone accepts is not an easy process.

The hon. Gentleman advocated waiving or reforming some of the requirements in the case of a bid by a mutual. Removing the financial standing and technical capability factors or compromising them would import some real risk to franchisee financial resilience. That is my anxiety about what he advocates. If we were to waive the experience requirements in relation to a mutual, we would have to make the change for all potential bidders. That would reduce our ability to consider the track record of the major franchise operators that are currently in the market. The EU rules on equal treatment and non-discrimination mean that we have to treat all bidders the same and assess them against the same criteria. Therefore, anything that we do to help a mutual or co-op would also have to be offered to a commercial operator. If we were to relax the requirement on a track record, we would not be able to assess the previous experience and performance of the only groups that currently hold franchises. There would be public anxiety if the track record of train operators could not be considered in the award of new franchises. Moreover, the existing process is a further incentive and addition to the other regulatory mechanisms. We must keep performance levels high. To get through this difficult process, I encourage any mutual or co-operative that is considering bidding to approach my officials to get further advice.

The hon. Gentleman referred to the Go! Co-operative. I am delighted that we have that as an example of a co-operative that has expressed interest in running open access services. I gather that it would like to operate services linking main lines to some smaller market towns. I am told that it has identified a route from Yeovil Junction to Oxford for its first proposed services and that it hopes to commence operation during 2011. That is a welcome initiative. It is not for me to say whether it will get its paths or even get the operation off the ground. None the less, I very much welcome its involvement in the rail industry. There are also examples of small community-based companies running services, such as the Wensleydale railway in North Yorkshire, which has taken on a branch line from Northallerton to Redmire and is running passenger services.

I want to touch briefly on one last area. The voluntary and not-for-profit groups are already successfully engaged with the UK’s railways: I refer to community rail partnerships. The Government are very supportive of such partnerships and the work that they do. They have successfully brought additional passengers to many lines and helped to build up services and make better use of redundant property. For example, the Devon and Cornwall rail partnership works with the train operator in selling tickets at a number of locations. It encourages rail use by making it easier for the public to buy tickets. Partnerships such as South Fylde, Leeds to Morecambe and the Clitheroe line have produced impressive promotional material. Others such as the Bittern line in Norfolk have run successful promotional events. Almost all partnerships see the voluntary sector involved in improving and maintaining station facilities. There are numerous examples of local enthusiasts devoting huge care and attention to station gardens and floral displays. Right across the country, from Penmere in Cornwall to West Runton in Norfolk and Green Road in Cumbria, we see the visual evidence of the value of the work done by the voluntary and not-for-profit sector on our railways.

To conclude, the Government fully recognise and value the contribution made to the rail industry by the community-based and not-for-profit sector. I was interested to hear the hon. Gentleman’s example of co-operative cleaning services. I have no doubt that there are other areas in which mutuals and co-operatives will get involved in rail supply services. Rail franchise procurement processes can present a daunting challenge to any organisation, particularly those that have not operated a similar contract before. That is why my officials offer an open door policy for potential bidders. If a mutual or co-op expresses an interest in running a rail franchise, we will not place extra barriers in their path. They will be subject to the same rules and requirements as commercial operators. If they can meet the accreditation criteria, they can bid for a franchise. If they offer the best deal, they can win a franchise. It is as simple as that.

Railway Industry

Theresa Villiers Excerpts

Tuesday 19th October 2010 Westminster Hall

[Katy Clark]

My hon. Friend makes some powerful points, to which I will return later in my contribution. The privatised rail companies propose to threaten the progress that has been made in the railways in recent years. They want their companies to take over the infrastructure, perhaps on leases that would coincide with the length of the franchises. There is talk of trialling such arrangements in Merseyside or Scotland. The train operating companies have promised that that will incentivise them to invest in the railways, but they have provided absolutely no evidence to support that submission. Indeed, the evidence of the past and of their tenure with the railway passenger services shows that they simply seek to maximise profit and boardroom pay, as I have already mentioned. In fact, the Government’s own consultation document, “Reforming Rail Franchising,” states:

“European procurement law makes clear that contracts over 15 years require significant investment to be provided by the franchisee. Therefore, our starting proposition is that 12 - 15 years should be the standard length of franchises”.

That seems to say that we should extend franchises to the maximum length at which franchise holders have no legal obligation to invest significantly and leave investment completely at the discretion of the franchise holder.

[The Minister of State, Department for Transport (Mrs Theresa Villiers)]

I assure the hon. Lady that, whatever the length of the franchise, we will be pressing for the best deal for the taxpayer, including investment with longer franchises—whether they are for 10, 15 or 22.5 years.

[Katy Clark]

I am very pleased to hear the Minister say that. However, if we are going for franchises of approximately 12 to 15 years, there will not be that legal obligation, which must have a consequence for the decision that companies make.

[Mrs Villiers]

I am sure that the hon. Lady will appreciate that franchise documents impose significant legal obligations, and we expect those to include investment in the railways, particularly where a longer franchise is granted.

[Katy Clark]

I am pleased to hear the Minister say that. If the Government decide to go down the path of franchises of such a length, we will be actively scrutinising the situation to ensure that the contracts in place not only are legally binding but are enforced and deliver for the taxpayer and those who use the railways.

We know that the train operating companies are demanding further fragmentation and privatisation of our national railway structure. The former Network Rail chief executive talked about simply sweating the assets of the railway infrastructure. If franchises were coming to an end and existing operators were either not going to bid again or were not shortlisted for replacement, there is a great deal of concern that there would be little pressure on them to invest.

I also ask the Minister to consider carefully concerns that breaking up Network Rail would have a negative impact on rail freight. There is a real fear that passenger operators will be tempted to fill any spaces in the timetable with their own revenue-raising services, which would push freight to one side. Freight trains are often heavier than their transport equivalents and can do much damage to the track, which raises the possibility that the private operator could limit free access or leverage high track access charges on the movement of freight. That would force freight from the railway to the road, which would have a series of unhelpful environmental consequences.

Many people in the industry and in the rail trade unions are also concerned about the arguments of those who are making the case for breaking up Network Rail. In particular, they are concerned about the report of the Office of Rail Regulation, which is quoted again and again as stating that, compared with other European railways, Network Rail is up to 40% less efficient. I say to the Minister that hon. Members may make such points today because they have read articles in the press, but many in the industry, the RMT and the other railway unions have a great deal of concern about that report’s methodology. They believe it is flawed and that it has cherry-picked different aspects of rail infrastructure efficiency from abroad to paint our railways in a more unfavourable light. The report does not seem to take into account factors that determine efficiency, such as adequate investment over long periods, the need for a unified command structure and, most importantly, the continued fragmentation of our infrastructure compared with European railways.

We need to consider the benefits of having an integrated, publicly owned railway. I therefore hope that the Minister will ensure that those conducting the rail review—and the Government themselves—do not just look at the issue on an ideological basis, but consider the comparisons with other European railways. There has been some concern about the ORR’s report and I suggest to the Minister that she should be willing to receive more detailed representation from those who are concerned about that issue. It is obviously vital that we make the right choices for our railways.

In June, the Secretary of State said:

“Passengers and taxpayers will rightly ask why it is that our railways in the UK are so much more expensive than those in the rest of Europe.”

I believe that the answer is already there for him to see. For example, the 2009 European Commission report into the rail market made it clear that the structure of UK railways is radically different from that of railways in the rest of Europe. In terms of passenger operation and infrastructure, most of the railways in Europe are publicly owned and accountable, whereas in the UK they are not.

Compared with other railways in Europe, the organisation and structure of our railways is horrifically complex—they are fragmented and have numerous interfaces. We have 24 operating companies, three freight operators, three rolling stock leasing companies, two infrastructure controllers—Network Rail and Eurotunnel —and seven major infrastructure renewal companies. That must lead to huge inefficiencies. There is a duplication of function and a loss of economy of scale. In addition, the fact that there are so many individual companies means that there are increased profit margins and transaction costs—even the legal and consultancy fees are duplicated again and again. Skilled personnel validate and monitor contracts instead of getting on with the job and, perhaps most damaging, there has been a loss of a rail culture that focused on getting the job done, with one company and one stakeholder blaming the other when things go wrong. I understand that the rail review has already indicated that the railways could save hundreds of millions of pounds a year by reducing that fragmentation and the number of different organisations involved with them.

I hope that the Minister will look at what is happening to railways across Europe, which are overwhelmingly publicly owned and far more integrated than those in the UK. I believe that that would provide a better service and cheaper fares for the public, that it would be better for the environment and that it would lead to more high-speed rail and more electrification. Will she give an undertaking that there will be a transparent consideration of an integrated and publicly owned railway and that the methodology used to consider those matters will be made public?

I pay tribute to those who work on the railways. My hon. Friend the Member for York Central (Hugh Bayley) mentioned the Jarvis workers who have already lost their jobs. Thousands of Network Rail workers have been asked to make efficiency savings and many have already lost their jobs. I hope that we are now moving towards a period of stability and consolidation. We know, as he indicated, that many of the Jarvis workers are still without work and have lost their pensions. Given his comments, I suggest that it would be helpful if the Minister met me, him and other interested colleagues to discuss the plight of those workers and whether the Government can do more to ensure that alternative employment is available for them in these difficult economic times. Thousands of jobs have already been lost on our railways, on both the passenger and freight sides, and we are also seeing a gradual attack on train guards as companies try to introduce driver-only operations, which will reduce staffing levels even further and, I believe, raise significant safety concerns.

In Scotland, the Scottish National party Administration have taken advantage of the clause included in all railway franchises that allows railway companies to ask the Government to make good the loss of revenue caused by strike action. The Labour party in Scotland says that it will remove that clause from ScotRail franchises if it is successful in next year’s elections. Does the Minister agree that the current review of railway franchises should look at that matter and remove that provision from all franchises?

Many people who work in ticket offices are losing their jobs, with implications not only for them but for safety. We know that there is some protection for ticket offices, as train operators are required to consult passengers and Passenger Focus if they wish to shut offices or change their opening hours. Does the Minister agree that those protections must remain in place and should not be removed as a result of the review? Thousands of jobs are under threat in London Underground, many in ticket offices, as a result of the Mayor’s decision to renege on his election promise on staffing levels. Cuts will also fall elsewhere, including safety-critical railway maintenance jobs. As a result, there has been strike action on the Underground, as the Minister is aware. Indeed, the workers who were hailed as heroes after the London bombings in 2005 are now often vilified in the press as enemies of the state. I hope that there is a negotiated settlement to the dispute, and I pay tribute to those members of the RMT and the Transport Salaried Staffs Association who are taking a stand on behalf of passengers and rail safety.

I have put several questions to the Minister and am most anxious that she respond to them either today or, if she is unable to do so, in writing at a later date. I will mention those questions again, because they can often be lost in Adjournment debates. Will she clarify whether the McNulty review will inform the transport decisions in the comprehensive spending review set out tomorrow? Will she write to the executives of the big transport companies and ask that they practise pay restraint in the boardroom? Will she agree to a levy on the profits of the privatised rail industry or, at the very least, tell the companies to freeze their profits and invest them back into the railways? Will she meet me and other interested parties to discuss the continuing plight of the former Jarvis workers? Will she ensure that the franchising review results in the removal of clauses that allow taxpayers’ money to be used to indemnify train operating companies against losses incurred during industrial action? Will she ensure that the Government transparently consider the benefits of an integrated and publicly owned railway network and publish the methodology that they will use to consider the matter?

--- Later in debate ---

[Mr Weir]

The hon. Lady makes a good point. Whether electrification is greener than its alternative depends on how the electricity is generated, but that is an associated issue. However, she is right that the faster train journeys can be made, the more likely it is that people will use the train rather than travel by air. That is my point. Flying to London from Manchester or Birmingham no longer makes sense, but it does make sense to travel from Aberdeen by air unless something is done to speed up the train line. I appreciate that that is not easy to do, but the Government must look at the issue seriously.

My other point is about the high-speed rail network. The Government have announced their proposal to go with the Y route, which would run up the centre of England to the north-east and the west coast. It will speed up journey times and, if I understand it correctly, link up with the east coast line and provide a slightly faster journey time at least as far as Edinburgh. As it stands, however, although the proposal will considerably speed up rail travel to the north of England, it does not address the central problem of taking the line further north into Scotland. If the Government are serious about the issue, we must look at an extension of the line to ensure faster travel times from Scotland and encourage people away from the longer domestic flight routes. Unless we do that—and the same argument goes for the east coast—we will not get the green benefits that we hope for. As it stands, if I were to use the high-speed line to get home, I would probably have to change train twice to get to Montrose, and that will not significantly reduce the journey time.

[Mrs Villiers]

The hon. Gentleman may recall from the coalition’s programme for government that we want a genuinely national network. Experience tells us that that must be delivered in phases as it takes some time. The ultimate goal, of course, is to take high-speed rail to Scotland. It would be interesting to hear whether the Scottish Government are willing to devote resources to that programme in the future. I have discussed the issue with them, and I hope that in the future they will consider whether they can devote some of their resources to aiding such a project.

[Mr Weir]

I am sure that the Scottish Government will do that. However, there is not much point in building a high-speed line if it does not link up with the rest of the network. At the moment, the high-speed line will run nowhere near Scotland. I understand that Network Rail had a proposal that would have taken the line into central Scotland. That would have made more sense, it would have linked central Scotland with the main high-speed network running south, and it would have provided the basis for an extension of the network further north. At the moment, as the Minister knows, the high-speed network comes nowhere near Scotland, and it will be many years before it gets as far as Edinburgh. The Government seem to take a London-centric view of the matter. If we were to tip things the other way so that the line ran south, the speed of journeys would increase faster and the green objectives of the Government and the Scottish Government would be met.

The Scottish Government have invested a lot in the railway in Scotland. I accept that that is their responsibility and that some of the work must be done in Scotland—there is no argument about that. For example, the Scottish Government opened a new station at Laurencekirk on the east coast line, although strangely enough the direct mainline services will not stop there, so people still have to get a train to another station to get on those direct services. ScotRail runs a good service to Edinburgh and Glasgow, but again, people have to change trains to get on to the direct line to travel further south. People going on business trips look for a direct service. New lines have been opened from Stirling and Alloa; there is a new line from the border and considerable improvements along the Paisley corridor. All those things have improved rail travel in Scotland, but we still need links to the lines that will take us to continental Europe through the Eurostar network. To do that, unfortunately we need to rely on the Government in this place taking action on the east coast line and the high-speed line.

My main point is to ask the Minister about the rolling stock for the east coast line, which is the responsibility of her Department. As the hon. Members for Newton Abbot (Anne Marie Morris) and for Hayes and Harlington (John McDonnell) pointed out, the new trains are vital to show that the Government are serious about investment in our railways and in the important economic asset of the east coast line. I appreciate that the comprehensive spending review is tomorrow, but I urge the Minister to ensure that the rolling stock is purchased and that a clear signal is given about the future of the line.

[Andrew Gwynne (Denton and Reddish) (Lab)]

I am pleased to contribute to this important debate about the future of the rail industry, particularly as this is my first official outing as a member of the Opposition Front-Bench transport team. I also congratulate my hon. Friend the Member for North Ayrshire and Arran (Katy Clark) on securing the debate today.

In recent years, a welcome consensus has developed around the importance of support for the railways, both the conventional and high-speed varieties. All parties recognise the important role that the rail industry must play in reducing the environmental impact of travel, and welcome the growth in passenger numbers that we have seen in recent years, to the point where more people travel by train today than at any point since the 1940s.

We need a system that works effectively and puts the needs of passengers, and indeed freight, at its core. We all want a clean, safe and efficient train network in the future, and one that is fit for purpose. The previous Labour Government were committed to providing that and, as my hon. Friend the Member for Hayes and Harlington (John McDonnell) said, we hope that the current Government recognise the need to continue the investment in the railways that our country so desperately needs. Given the comprehensive spending review tomorrow, we may well soon see how committed the Government are to the future of the railway industry. Like my hon. Friend the Member for North Ayrshire and Arran, I also welcome the lobby today by trade unionists and the TUC. We should remember that everyone is rightly concerned about the cuts that might be announced in the near future.

I would like to look at fares. The coalition’s programme for government stated that they were

“committed to fair pricing for rail travel.”

Will the Minister comment on reports from Channel 4 News over the weekend which speculated that we could face double-digit rises in train fares over each year of the spending review? It was reported that train fares are expected to be more than 30% higher by 2015, and industry sources pointed to a possible 40% hike in prices by 2015.

Media reports also suggested that the cost of a typical commuter season ticket between Brighton and London could increase from £3,104 a year to £4,260 by 2015, and between Swindon and London from £6,640 to £9,130. Does the Minister think that long-suffering train users will be willing to accept that?

[Mrs Villiers]

I would be grateful if the shadow Minister answered a question. Is he saying that if Labour had been re-elected, it would have cut rail fares?

[Andrew Gwynne]

I am very grateful to the Transport Minister for that, but of course it is my job to ask her questions. Labour is in opposition and I am asking whether she thinks that those kinds of speculative rail increases are fair on passengers.

[Mrs Villiers]

The hon. Gentleman should not believe all he reads in the papers. The coalition is committed to fairness on rail fares. The announcement on the fares formula for the next few years will be made on Wednesday in the comprehensive spending review.

[Andrew Gwynne]

I appreciate that, but it could well mean that some lines end up with a pricing of RPI—the retail prices index—plus 5%. That is particularly ironic, as the hon. Member for Lewes (Norman Baker), who is now a Transport Minister, was elected on a pledge in the Liberal Democrat manifesto on train fares for RPI minus 1%; and the Secretary of State, as the Minister has reiterated today, has previously said that he has made a commitment to fair fares.

Passengers will not pay more for less. If they see increasing fares alongside cuts to plans for new capacity and infrastructure, that could mean fewer people travelling by rail. What guarantees do we have that fare rises will be matched by infrastructure and capacity improvements? I appreciate that the Minister will be reluctant—perhaps unable—to add much today and we shall have to wait to see what the Chancellor of the Exchequer says in tomorrow’s comprehensive spending review.

Franchising was mentioned. The Government’s consultation includes an intention to impose a far more relaxed and flexible specification. Flexibility can be a good thing, but there is a worry that a hands-off approach could allow train companies to become too focused on short-term profit and cost cutting, rather than delivering the best service for passengers and encouraging greater use of the railway. Will the Minister give me assurances that that will not be the case and that sufficient specification to guarantee socially important services will remain?

It is encouraging that there is interest in rail franchise bids from not-for-profit, mutual or co-operative franchise enterprises. Indeed, I note that my hon. Friend the Member for Luton South (Gavin Shuker) has secured a debate on that topic in Westminster Hall tomorrow. However, there are still unfair barriers that prevent such bids from benefiting passengers and taxpayers, as we saw recently with the attempt by the Co-op through its Go! Co-operative initiative, which would have been the UK’s first co-operative train operating company.

I shall refer briefly to some recent investments in rail. It is important to acknowledge, as my hon. Friend the Member for Hayes and Harlington and others did, the significant progress that the previous Labour Government made in the past decade in rebuilding the country’s transport infrastructure after many decades of under-investment, which happened, to be fair, under Governments of all political persuasions.

We have completed the £9 billion programme to modernise the west coast main line, resulting in massive reductions in journey times, as I thankfully know from experience. It is now less than two hours from Stockport to London and, more importantly for me on a Thursday, from London back to Stockport.

Performance, capacity, reliability and safety levels throughout the rail network have improved significantly. High Speed 1 was up and running ahead of schedule, and the stunning redevelopment of St Pancras station proved to be a fitting terminal for high-speed trains to and from the continent. We delivered Britain’s first high-speed rail line and set out plans for a new north-south high-speed rail network—points made by my hon. Friend the Member for Hayes and Harlington and by the hon. Member for Angus (Mr Weir).

We more than doubled investment in local transport from 1997, improving accessibility and helping to tackle social exclusion in local communities. By May 2010, investment in transport had reached its highest level as a proportion of national income for 30 years. In addition, Labour finally achieved what previous Governments had tried but failed to do, in securing a funding deal for Crossrail. That is one of the most ambitious transport projects of recent years and will add 30,000 high-value jobs to London in the first 10 years and add an estimated £20 billion to the UK’s gross domestic product. We also set in place the £5.5 billion upgrading of Thameslink, which will introduce new cross-London routes and, with longer, more frequent trains, will allow for much-needed capacity, more seats and less crowding on key routes in the capital.

The northern hub made it an ambition over the next 20 years to increase the number of train services in the north, including cities such as Newcastle, Liverpool, Manchester, Leeds and Sheffield, by 40%—700 more trains a day—making it possible for 3.5 million more passengers to travel by train every year. Those innovative and challenging projects were either delivered or planned. We need to continue that long-term focus on infrastructure and service if we are to provide Britain with the transport system that it needs to compete in the new global economy.

I wish to raise some specific issues with the Government. Transport cuts so far have totalled £683 million. That includes £108 million coming from Transport for London and £50 million from the better stations programme. I declare an interest, as that had a particular effect on Stockport station, which affects some of my constituents. The plans for hundreds of extra carriages to ease overcrowding have been put on hold.

In opposition, the Conservatives criticised the Labour Government in their 2009 rail review document, which recognised the need for extra capacity but accused us of not taking the problem seriously. There is a need for more trains, and I ask the Minister to tell us what the Government will do to alleviate that problem.

Can the Minister give me an assurance on electrification—an issue mentioned by my hon. Friend the Member for Bolton West (Julie Hilling)—both of the north-west routes and the great western main line, which are important projects to both regions? Likewise, can the Minister confirm that the Thameslink replacement of rolling stock will go ahead, which would in turn lead to the cascading of trains to the great western main line and the north-west routes?

The Government owe it to London’s business community and the travelling public to be open about their plans for Crossrail. Will the Crossrail project be delivered in full, as proposed by the previous Labour Government? Will there be any cost cutting in areas such as engineering, which could lead to shorter platforms and less capacity? Will the number of stations on Crossrail remain unchanged?

May I ask also about the bonfire of the quangos that we saw last week? What plans does the Minister have for Passenger Focus and what will its functions be now? How will disabled passengers be heard effectively now that the present Government have abolished the Disabled Persons Transport Advisory Committee? The input of disabled passengers should be important, and that body provided a unique opportunity for both disabled people and industry to represent their case to Government.

The Government need to look beyond the period of the comprehensive spending review. We need a long-term vision for rail and we need to deliver these projects to build on our ambition for a world-class rail service in this country. The previous Labour Government left the rail network in a far better condition than we found it in. Rail passenger numbers increased by 40% in the past 10 years, and punctuality and quality of service improved steadily over that time, too. That is not an inheritance that the current Government should squander.

[The Minister of State, Department for Transport (Mrs Theresa Villiers)]

I congratulate the hon. Member for North Ayrshire and Arran (Katy Clark) on securing the debate, and congratulate the shadow Minister, the hon. Member for Denton and Reddish (Andrew Gwynne), on his recent appointment and his first address from the Front Bench.

I thought that it would be useful to consider the questions that the hon. Lady helpfully repeated at the end of her speech. First, she asked whether Sir Roy McNulty’s work is informing the comprehensive spending review. Neither his interim report nor his final report have yet been published or finalised, but I can assure the hon. Lady that Sir Roy has kept my right hon. Friend the Secretary of State and officials at the Department for Transport informed of his work, so that is feeding into the decisions being made on the comprehensive spending review. The early draft work, as it has been going ahead, has helped us to feed into the Treasury process and the CSR.

The hon. Lady also asked whether I would write to the executives of the rail operating companies about remuneration.

[John McDonnell]

Before the Minister moves on from the McNulty report, I point out that I asked whether she would meet the rail unions to discuss the McNulty report when the interim report is published in November.

[Mrs Villiers]

I was going to come on to that, but I am happy to answer it now. I have slight qualms about this while the industrial action is continuing on the London underground, because I am concerned about the huge inconvenience that that is causing passengers. As the hon. Gentleman is keen for me to meet the unions, I am happy to do that, but I would still urge them to find an alternative way to resolve their dispute on the London underground.

[John McDonnell]

The two issues are unconnected. We will make sure that the right hon. Lady can travel on a non-strike day.

[Mrs Villiers]

I suppose that I am particularly sensitive about the issue because the day on which I was due to meet the Transport Salaried Staffs Association coincided with a strike day so, for all sorts of reasons, it seemed inappropriate to go ahead with the meeting.

Turning to remuneration in the rail industry, the level of pay across the industry clearly needs looking at in the context of the McNulty review. I have discussed remuneration levels with the train operators, and I expect that dialogue to continue.

The hon. Lady’s third question was about introducing a windfall levy for the train operators. The Government have no plans to do that. Her fourth question was whether I would meet her and colleagues to discuss those who—tragically for them—were made redundant by Jarvis. Yes, I would be happy to do that.

On the franchising review, the hon. Lady asked specifically about a clause on ScotRail and she will appreciate that that is a matter for the Scottish Government, but she also asked a wider question about the approach that the UK Government will take in relation to the franchises for which we are responsible. I am not convinced that we should have a blanket withdrawal of that type of indemnity clause; there is a place for such clauses in appropriate circumstances. She then asked whether the McNulty review, and the Government considerations flowing from it, would look at an expanded role for the public sector and additional nationalisation. That is certainly one of the options that Sir Roy will consider.

The hon. Lady also asked about ticket offices and the loss of guards. In many cases those are matters for those operating services, but the overall approach in relation to the franchises is governed by the ticketing settlement agreement. We need to look at reforming that, to ensure that we get it right, but it is obviously important to consult properly with the communities affected by the decisions.

The hon. Lady also talked about the strike action on the London underground and the loss of guards. I am convinced that we need to modernise working practices in the rail industry. I am concerned, as I already said to the hon. Member for Hayes and Harlington (John McDonnell), about the damage to the London economy caused by the strike action that is taking place. We have to recognise that the way in which people buy tickets has changed, and that rightly will impact on London Underground’s decisions about the deployment of its staff.

[Julie Hilling]

Does the Minister consider important the feeling of safety of passengers travelling on the underground, and on the rail network generally? Stations can often be very lonely, scary places for all rail users but particularly for women travelling alone. The fact that we have staff in ticket offices and on platforms increases both the feeling of safety and the actual safety.

[Mrs Villiers]

Forgive me; I am probably trespassing on devolved matters because the relationship between London Underground and its employees is of course a matter for which the Mayor is politically accountable. I have to say, however, that of course I am concerned about security for women using public transport—I am a woman myself—but there is a real argument for saying that staff deployed on platforms are more valuable to passenger security than those stuck behind ticket office windows. I am not sure, therefore, that the security issue can justify the retention of ticket offices. Security focuses on whether people have access to staff in stations, which is not the same as whether a ticket office is open.

I shall go on to some of the wider issues addressed by the hon. Member for North Ayrshire and Arran. I would like to assure the House that the coalition has put rail at the heart of its strategy for transport, in terms of re-energising our economy, reducing carbon emissions and addressing congestion on our roads. I welcome the support shown today for taking into account the concerns of both passengers and rail freight—a point rightly made by the shadow Minister. Much will depend on the announcements made tomorrow in the spending review. It is clear that transport will not escape the pain that is the unfortunate consequence of the deficit that we have inherited from the previous Government, but I emphasise that the Chancellor has made it clear that he recognises the economic benefits of investment in infrastructure to support economic growth, and that he recognises in particular the importance of investment in transport infrastructure.

The shadow Minister asked me about Crossrail. I am sure that he welcomed, as I did, the support expressed by the Chancellor at the weekend for the Crossrail project. We have also expressed clear support for Birmingham New Street, we are taking forward plans on high-speed rail and we are working very hard on Thameslink. Our focus in all those projects is to ensure that we value-engineer costs down to keep the projects affordable and deliverable within the spending envelope that is now available.

[John McDonnell]

I emphasise that, although there is a commitment to the Crossrail project overall, people are concerned about the paring down of the project and the missed opportunities that might result from that. For example, in my own constituency, Hayes and Harlington station is to be redeveloped. If there is any paring down in the investment of such station projects, we will miss the chance to include modal transfer opportunities and to ensure the integration of our local transport network.

[Mrs Villiers]

Both the Secretary of State and I have repeatedly talked about our support for delivering the whole project, and it is worth bearing in mind the excellent work done by the team behind Crossrail to find lower-cost ways to deliver the same transport benefits, and to deliver the whole project.

It is true that there has been significant good news on the railways in recent years. Since privatisation there have been some striking successes, with train punctuality now at record levels and a significant increase in the number of passenger journeys. Also, the number of miles travelled on the railways has gone up by 75%. Since privatisation, therefore, a story of managed decline has been transformed into one of significant growth. Although the recession has subdued that trend to a degree, we expect it to resume once the economy recovers.

So, that is some of the good news about the UK’s railways. But the downside is that the cost of running the railways did rise dramatically under our Labour predecessors. If we are to deliver the improvements to services and capacity that hon. Members have called for today, and that passengers want, we have to find a way to get costs down. The disastrous deficit left for us by our predecessors makes it essential that we drive out cost inefficiencies on the railways, and we owe it to passengers to do our very best to get costs down.

[Andrew Gwynne]

Does the Minister not also recognise that it was the investment by the previous Labour Government that led to the very improvements that she has just championed as a cause of privatisation?

[Mrs Villiers]

I certainly recognise that the previous Government invested in the railways, and we would expect investment to continue under the current Government, given the huge importance of the railways to our economy and to our climate change ambitions. I covered the fares issue briefly in response to the shadow Minister, but I shall repeat my comments on it. The coalition is committed to fairness in rail fares, but the reality is that the crisis in the public finances means that we might have to take some difficult decisions on fares, as in other areas. As I have said, I am unable to give further details on the fares formula until it is announced for the coming years in the CSR on Wednesday.

There has been much discussion about the McNulty process, which is focused on trying to understand why the cost of the railways is higher in this country than in other parts of Europe, and I am sure that today’s discussion will contribute to and inform that process. It is important that a range of options be considered, and as part of our drive to deliver high-quality rail services at an affordable cost we need to consider how we reform Network Rail. Not even the levels of taxpayer support over recent years have succeeded in turning the company into the customer-oriented organisation that train and freight operators want. That fact was driven home when the rail regulator published the figures, to which the hon. Member for North Ayrshire and Arran referred: the potential 40% efficiency gap between Network Rail and European comparators. I acknowledge that there are always problems comparing Network Rail precisely with different railways in the rest of Europe, but these things should sound a warning bell that there is an issue to be addressed. If we are to be fair to passengers and the taxpayer, we need to find a way to make Network Rail more efficient.

[Katy Clark]

I think that it is accepted on all sides that there are issues to be addressed; indeed, that was why the previous Government set up the review in the first place. However, the Minister will have listened to what I said about the concern about the methodology used in the ORR report. Is she willing to hear further representations about that from those in the industry who have concerns? Given the publicity that the issue has had in the press, there is clearly a view that the Government will listen to the ORR report rather than taking a more forensic look at how other European railways operate.

[Mrs Villiers]

Of course I would be happy to accept further representations. One reason why we have continued with the McNulty study, which was set up by our predecessors, is precisely to find the true picture of the cost of Network Rail. The work done by the ORR is valuable, but it is just one point of view. Sir Roy is drawing on views and research from across the rail industry, including internationally, to find out what the facts really are.

Whatever reform we ultimately select, we will need to stress-test it in relation to the interests of freight operators. It is vital that we get the right balance between the interests of the railways’ passengers and freight customers.

In looking at the options for reforming Network Rail, it is interesting to look at what has been done north of the border. Network Rail has decentralised its Scottish operations, and accounting separation has been introduced. We need to look carefully at whether such decentralisation might improve Network Rail efficiency in other parts of the UK.

My officials are working with Merseytravel, the passenger transport executive for Merseyside, to explore whether to devolve the running of the track used by the Merseyrail franchise so that it is wholly governed by local decision making. That project could help to provide an important benchmark against which to measure Network Rail’s performance.

Another key issue is whether further contestability could be introduced for some of the work now carried out exclusively by Network Rail. Again, there is a Scottish example that is worth considering. In 2006, for example, Transport Scotland opened up about £20 million of rail funding for smaller-scale enhancements at stations and asked for offers from Network Rail and the train operators. By the end of the bidding process—if I recall correctly, this was under the Labour Administration— £19 million of the £20 million available was allocated directly to the passenger operators because their bids were judged to be better than Network Rail’s. A similar approach has been used for the national stations improvement plan in England.

The hon. Member for North Ayrshire and Arran talked at length about franchise reform, which is the second limb of our work to improve the railways’ performance for passengers and to get better value for money. The Department for Transport has recently concluded a consultation, and we are considering the responses. As I assured the hon. Lady during her speech, we want to encourage greater private sector investment in return for potentially longer franchises. We would continue to impose legally binding contractual obligations in franchises, including on the scale of the investment promised. We hope and believe that longer franchises will help us to deliver the investment and improvements that passengers want, including better stations. Longer franchises should also make it easier for train operators to invest in long-term relationships with Network Rail and their work force, which are crucial to running the railways efficiently.

We want to move to a system in which franchises are less heavily specified. In response to the shadow Minister’s questions, however, I can assure him that we will continue to set demanding outcomes for train operators to achieve in terms of the quality of service that they deliver. We will have demanding and legally binding requirements to protect the interests of the passenger and the taxpayer. The difference is that in setting those outcomes, we propose to give the people running the railway more flexibility over how they deliver them.

[Katy Clark]

The Minister will recall that, in my initial contribution, I quoted the Government’s consultation document, which said that European procurement law referred to 15 years and that that was why a starting point of 12 to 15 years should be the standard length of franchises. Does she not accept that that rings alarm bells? Will she explain why there is a link between European procurement law and her starting point?

[Mrs Villiers]

Obviously, the UK Government are bound by European procurement law to procure public contracts in a fair and objective way. In the context of rail franchises, it sets a top limit of 22 and a half years for contracts that involve investment. The reference to European procurement law was included in the consultation document because it governs the maximum that we can deliver in terms of rail franchises. Throughout the process of negotiating franchises, however, we will look to secure the best deal possible for the taxpayer, and we will ensure that we continue to protect the passenger interest. Train operators that do not comply with the obligations we impose on them will face sanctions, which, in extreme cases, could include removing the franchise.

In the few minutes that I have available, I want to talk a little about the inter-city express programme in response to the hon. Member for Angus (Mr Weir). I can assure him that we have no plans to scrap through services to destinations such as Aberdeen and Inverness, which he mentioned. As he said, the report produced by Sir Andrew Foster referred to one of the alternative strategies for the IEP, which involved ending those through services. As I said, however, we have no plans to do that. We recognise the economic value of such services, and we have certainly received strong representations from the Scottish Government and Scottish colleagues about the importance of retaining them.

[Mr Weir]

Will the Minister give way?

[Mrs Villiers]

I am sorry, but I have only two or three minutes, and I want to respond to an awful lot of points.

The hon. Gentleman and others talked about the electrification of the railways. We included our support for electrification in our programme for government and we recognise its benefits. It will support our sustainability objectives and improve services for passengers. It will become more and more of a greener option as we decarbonise the electricity-generating network. The pace at which we can deliver electrification will obviously depend on affordability and the priority of tackling the deficit. Much will depend on the comprehensive spending review announcement tomorrow. Of course, these decisions are also linked with the work on the high-level output specification rolling stock programme, Thameslink and the future of the IEP. An announcement will be made on those in due course.

Lastly, in the brief time that I have, I want to reiterate the Government’s support for high-speed rail, which is a vital upgrade for our transport network. We recently announced our support for a Y-shaped network, with a line to Manchester and trains running on from there to the west coast main line and Scotland, and another line splitting off at Birmingham and going through the east midlands and South Yorkshire to Leeds, with trains, again, running on to the existing network and destinations further north. We will consult on that shortly. We will also have regard to the communities affected by the line’s local impact before taking final decisions on whether to go ahead and what route to take. We appreciate that realistically these lines can be delivered only in phases, but our ultimate goal is to deliver the national network, for which I am sure there will be cross-party support.

Much has been achieved since privatisation, but we need a fresh focus on reducing costs in the railways that we already have. We need a drive to deliver high-speed rail because of the huge benefits that it can provide. The coalition is determined to meet both those challenges, and I welcome the representations that I have received on them today.