Network Rail

Thérèse Coffey Excerpts

Thursday 2nd February 2012 Westminster Hall

[Dr Thérèse Coffey (Suffolk Coastal) (Con)]

It is a great pleasure to participate in this debate under your chairmanship, Mr Rosindell. I was delighted to secure the debate, led by my hon. Friend the Member for St Albans (Mrs Main). On behalf of us all, I would like to ask the Minister to pass on our best wishes to my right hon. Friend the Minister of State, Department for Transport, who has responsibility for rail, who has sadly had an accident. I understand that she is back on her feet. I hope that she makes a swift recovery. I know she is very resilient, but I hope she gets the rest she needs to make a full recovery.

Network Rail is 10-years-old this year. We all know how, why and when it came into existence. It is timely and appropriate to have this debate, especially as just over a month ago the Office of Rail Regulation served a notice of breach of licence to Network Rail on two fronts: on long-distance rail and on freight rail services. I have a particular interest in freight rail, which I will come to later in my speech.

One point that has been well expressed—I will try not to repeat too many points that have already been made—is that there has been some progress with Sir David Higgins. However, that does not mean that his job already requires significant six-figure bonuses. I am sure I am not the only person whose eyebrows were raised on understanding that that would be the case. I encourage the remuneration committee of Network Rail to consider carefully—having received those two breaches and considering the ongoing challenges that our constituents face—whether that bonus would be appropriate. I have no problem at all with rewarding success, but I cannot say at the moment that there has been great success on our rail network.

Since the debate was announced, I have had a very quick response from Network Rail. I commend my hon. Friend the Member for St Albans, because I understand that she would not meet with Network Rail until the debate had taken place. I did meet people from Network Rail. It was fantastic that my original query from last summer, which I followed up in October and again in January, was finally answered—good news. It also gave me the opportunity to meet Dave Ward, who has been put in charge of the East Anglia region. He talked about some of the changes that have already happened, and what he plans to do. I will give praise where praise is due: I like some of the changes that have been proposed. However, the proof will be in the pudding.

I want to mention briefly factors beyond control, which have been talked about. Perhaps this is degenerating the debate, but Network Rail has often been called “Not work rail” or “Network fail”. The wrong kind of leaves and the wrong kind of snow—these factors are difficult and I accept that. Extraordinary incidents will happen; for example, burst water mains. Cable theft has been a growing problem. The Government have responded. That response perhaps took longer than everybody wanted, but they have done the right thing in tabling an amendment on tackling metal theft, which will include aspects of cable theft. Network Rail could have done more itself to assess the security of its own lines, whether through technology, or through the good old-fashioned use of people to check what is going on. Indeed, Mr Ward suggested to me that he is spending £2 million on security patrols to try to ensure that such theft does not happen, or at least that it is reduced, and I welcome that.

I also want to mention two Members who cannot be here today. My hon. Friend the Member for Ipswich (Ben Gummer), who also helped to secure the debate, is opening the wing of a hospital, or something like that, in Ipswich. I pay tribute to his relentless work in trying to improve and secure investment for the greater Anglia area. My hon. Friend the Member for Witham (Priti Patel) has already spoken about the challenges for that line, so I will not repeat them. My hon. Friend the Member for Ipswich has also been working with my hon. Friend the Member for Norwich North (Miss Smith) on the Norwich in 90 and the Suffolk in 60 campaigns, bringing together MPs from across all three counties to ensure that we get a better service.

The other hon. Member who cannot be here is my hon. Friend the Member for Lincoln (Karl MᶜCartney). He also has to meet constituents today, and he wanted me to plug the fact that he is fed up with Network Rail. Anyone who has ever been to Lincoln will know that the railway line dissects it. He believes that the latest proposals for freight will mean that the level crossing will be closed for 40 minutes in every hour in daylight hours. He does not think that that is acceptable, and that is a fair point.

On issues of cost and time, we have heard some interesting ideas about what the right thing to do is. Is the right thing to go back to integration, or is it to introduce more competition? My first interaction with Network Rail came about after we lost the hourly service, which had been agreed before I became the Member of Parliament. Passengers had to change trains—there was no through train all the way to Lowestoft and they had to change at Ipswich. That meant that passengers who were not so mobile, or those with heavy luggage, had to be escorted across the tracks. On a very tight connection time of perhaps less than six minutes, that did not always feel very safe or ideal. In fact, passengers ended up going outside the canopy and out into the open elements. Wet or icy weather added to the problem.

Network Rail was supposed to build a footbridge and lifts. It did so, but they were several months late and cost £2.7 million. I understand that £1 million a lift is the going rate, which leads me on to a general point. Everything from Network Rail seems to be costed in units of £1 million: do we want a level crossing? “Yeah, that will be £1 million.” A new academy school building is being built and more children will use a particular route on the way to school. Network Rail has lodged an objection in respect of Runnacles Way, because children walk across there. A bridge is required, which might cost £1 million, or it might cost £2 million. Meanwhile, someone who has been doing some contracting work for the Environment Agency—which used to have the same problem in my view; everything was very expensive—reckons that he can build the bridge for approximately £150,000.

We should not accept that everything costs £1 million or more. That is why I was encouraged by the changes—I think it is called the devolution principle—that allow directors to take control of their regions. The Network Rail group that currently does a lot of small projects will be opened up. Pilots are being conducted to find out whether other firms can bid for tender. Indeed, Abellio, the new franchisee that comes online within the week, has said that it would strongly consider doing that; it does maintenance projects in the Netherlands. That presents an opportunity, but without the complexity that adds cost through procurement, as the hon. Member for Luton North (Kelvin Hopkins) said. However, we need to do something about value for money. We should not accept that the cost of everything is in units of £1 million. Network Rail pulled its finger out with the floods in Cumbria and rebuilt a station in three days, which was fantastic. I would love to see that happen everywhere.

[Kelvin Hopkins]

The hon. Lady is making a strong point about cost. British Rail used to have cash-limited projects that worked within cash limits. The engineers and the directly employed people said, “How do we do this as cheaply as possible? We have to work within the cash limits and we want to do the best job possible.” That actually worked, and is one of the reasons why cost was low in BR’s day.

[Dr Coffey]

The hon. Gentleman has more experience than me on those matters. Some interesting ideas are coming out today—I am sure that the Minister will take note of them—about building not just to spec, but being part of the design solution, and about other activities being constrained within a budget.

I should like to thank Network Rail, Suffolk county council and the Government for putting aside the money to ensure that we get the Beccles loop, which will reintroduce an hourly service all the way through to Lowestoft, as opposed to our only getting trains every two hours beyond a certain point. That improvement should be in by the end of this year.

Level crossings are a big challenge in my constituency. I respect the ambition of the hon. Member for Hayes and Harlington (John McDonnell) to see no level crossings at all, but I do not believe it is feasible. I live in a rural area with nine stations and 50 crossings, but many of those are bridges built a long time ago, back in Victorian times. Of the 27 level crossings in my constituency, only 11 have automated barriers. Eight have to be opened by hand. People drive up, get out of their car and walk to the gates, use the phone, open both gates, drive over, and then come back and close the gates. Those are the examples we could find; we have been doing a bit of research. I have used such a crossing and, as hon. Members can imagine, I have avoided using that route again.

In eight places there are just lights, with no barriers at all. Two of those are on A roads, one with 15,000 traffic movements per day. There have not been that many accidents, but I am not sure whether that is due to the design or people’s patience. It is such a crossing that I have been chasing Network Rail about—the one that will cost £1 million for installing two barriers—and I am delighted to say that I was told that it would be done by 2013. I am delighted that Network Rail has committed to doing that, but its challenge is to try to do that more cheaply. I want the response paper to contain something about how we are going to tackle some of those matters. The example that I have mentioned is not the only level crossing that is needed.

In a rural area, I would rather have routes than roads blocked off. If there were an insistence on there being no level crossings at all—just an underpass or bridge—quite a lot of mobility within rural areas would be compromised. It is about taking a risk-based approach and seeing whether we can do something about some of the crossings where people have to get in and out of their cars, and so on.

I welcome the change in who can bid for work, which will be piloted. I understand that Anglia will be part of that pilot. However, it is critical that there is transparency. I want Network Rail to report on how many projects are internal and external. Starting to show value for money and the percentage, or value, of work being done externally would be a useful barometer.

[Mrs Main]

My hon. Friend is making a powerful speech. When I was looking to research this debate—I did not want to get too involved—I was amazed, in respect of contract tendering, that Network Rail’s costs for a job seem to be padded out with all the worst-case scenarios and it comes up with a massive figure and adds a bit on top for good luck. If everybody operated like that, nobody would be awarded the tender. Network Rail would be forced to produce a better set of figures if others were allowed to tender as well.

[Dr Coffey]

My hon. Friend makes another important contribution. I worked at the BBC for a short while, so I recognise that contingency can be a big part of any project cost. I also recognise that things sometimes go wrong and that people have to react quickly. I mentioned earlier an analogy with the Environment Agency. Some works were done by the internal drainage board. Funnily enough, the framework contractor for the Environment Agency cost about three times as much as other contractors. We do not want to fall into the trap of—I had better use my words carefully—the establishment figures being the only ones that end up doing the work, because they are almost part of the same circle. I think that that is the best way of saying it.

I welcome the closer collaboration. Abellio will be involved. There is a challenge for the industry. Things are already happening as a result of the McNulty review, before the Government have published the Command Paper. I am delighted about that.

Other things are useful, too, including technology. My remarks at this point may answer some points raised by the hon. Member for Hayes and Harlington, who mentioned checking activity. I understand that things can be added to train roofs so that, instead of a visual check happening however often, a constant check can be made every time a train goes up and down a line. Simple ideas such as that one, which may cost a bit of capital—I get that—will build in some resilience. Instead of people being paid, frankly, to walk up and down—I am not saying that that should be got rid of entirely—such technology could be used to judge more intelligently the schedule of maintenance that needs to be done.

[John McDonnell]

That is exactly what the teams do now. They are not just walking the track; they are mobile and use new technology as well, but even teams that use new technology have been cut back recently.

[Dr Coffey]

I thank the hon. Gentleman for adding that point. Such technology has not been put on to the East Suffolk line and East Suffolk trains, so that is news to me, although clearly not news to him.

Hon. Members have already mentioned the finger-pointing. My hon. Friend the Member for Mid Norfolk (George Freeman) made an interesting contribution about whether alliances are enough or whether there should be mergers in respect of this whole operation, having train and track together. Let us challenge the way that Network Rail is structured and ask whether it is fit for purpose to deliver ongoing improvements and what we need.

On structure and governance, we have already talked about the complex structure that was devised in 2002. The coalition agreement specifically says that it will make Network Rail more accountable to customers. We look forward to the Government’s move on that. It would be useful to do something radical with Network Rail’s board and, instead of the 100 members, move to a 12-person board, for example, with a passenger group focus as part of that. Trying to manage that complexity is difficult. Hopefully, such a new process would allow for more focus.

I call on the Office of Rail Regulation to be focused on that in regulating Network Rail. The possibility of it going into train operating companies and other companies may be in the coalition agreement, but I would rather it stuck to the knitting and got that right before going into other matters. Passengers are clear when they are not happy about services. One way to try to regulate that matter would be to build it into the franchise or something similar.

I encourage Network Rail to stick to what it is good at doing. I was disappointed to hear—it has gone off the idea, thank heavens—that it considered setting itself up as a broadband operator. It is a clever idea to use things alongside the tracks to carry fibre, and similar, but the thought of its being in competition with BT Openreach was bizarre. Working with somebody who knows something is fine, as is becoming a conduit, but thankfully the idea that it would be the rival to BT Openreach went away.

Why am I interested in freight? Felixstowe, the leading container port, is in my constituency. It has rail terminals and a new one is going to be built. Putting freight on to rail is an important part of trying to reduce the percentage of freight on our roads. The Government are keen to do that, because it is good environmentally and it reduces demand on the key arterial roads throughout the country.

I encourage Network Rail to work with Hutchison at the port of Felixstowe so that it puts dualling in earlier. Due to the economic challenges that Hutchison said it was facing, it secured permission from Suffolk Coastal district council to delay that activity and had its planning permission extended, but it would make sense to do it now.

Some work has already been agreed—certainly, the consultation is starting—on the Ipswich chord, which, for hon. Members not familiar with Suffolk, would just add a bit of extra track, but means that, instead of many freight trains going into London and then out again to get to the north, those can go straight up towards Nuneaton. That makes a lot of sense and will free up a lot of capacity. To give Members a view of the costs, a 1 km stretch of track will be £41 million. Admittedly, that is not only for the steel on the track but for all the complexity of the other aspects. That is another example of the eye-watering amounts of money required for what one would like to think of as straightforward—perhaps I should not say that—key projects.

I also put in a bid for work at the Ely North junction, which would help freight traffic as well as certain passenger routes. Network Rail has a tough time with freight when connecting seaports; if Felixstowe or Liverpool close down, because of wind, rough seas or whatever, there is a bit of a problem. Dare I say it, however, the Network Rail people are paid a lot of money to solve difficult problems, so they must build that resilience into their timetabling and capacity building. The answer is not to do what happened to my hon. Friend the Member for St Albans, who suddenly had half the number of trains, because that is not acceptable.

Network Rail is a fascinating organisation. It is a case study of what can go well and of what can go wrong. However, the constituents of Suffolk Coastal and, more broadly, people throughout the country are fed up of being left waiting. It is vital that the Government grab the chance offered by the McNulty review and the Command Paper to put passengers and businesses first. Network Rail can be made to work, potentially, but the proof will be in the pudding, and I suggest to Sir David Higgins that, if we do not see much change within another year, we must question whether he has the capacity to make the changes necessary.

I thank all Members who have spoken so far. My hon. Friend the Member for St Albans will be winding up. I have enjoyed the debate and I genuinely think that there have been some fresh ideas that the Minister will absorb.