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passage. They have tabled so many amendments to their own amendments--tabling them in Committee when the ink was hardly wet on the first lot--that they have almost used up an entire Amazonian rain forest.

There was a time when I believed that, however misguided and inherently evil Conservative Members might be, they at least understood how to run things, and were technically competent. I have come to realise that I completely misjudged them. They stand before the country exposed as the shambolic rabble that they undoubtedly are.

When the public learn of this evening's events, and the passage of this measure from one end of the corridor to the other, they will be in no doubt about who is speaking for the nation. Members of the other place come in without deferring to the Whips, and with no hope of promotion ; they do not even need gongs, because most already have them. We have been reduced to observing the spectacle of those people speaking for the nation, not those who speak in this Chamber--the men of straw on the Conservative Benches who depend on the Whips for their prospects of promotion and patronage.

That is the position to which we have been reduced by the Government's shambolic conduct and a ridiculous measure which successive Secretaries of State for Transport have thought better than to introduce. The present Secretary of State, however, has insisted on pushing it through, at a deplorable cost to democracy and to his own electoral fortune. The Government will pay for that at the ballot box.

Mr. Brian Wilson (Cunninghame, North) : I must make one small correction before I proceed, Mr. Deputy Speaker. I received the news of the Government's defeat this afternoon, and I raised a point of order with Madam Speaker on the fact that the defeat had been on the pensions issue. Sadly, the defeat was not on the pensions issue, but on the franchise issue. I apologise for the fact that I inadvertently misled Madam Speaker this afternoon. That was the first time in the process of the Bill that I had a wrong piece of information. I think the whole of the British press were surprised when I said that the Government had been defeated on pensions rather than the franchises. It was a glorious victory, however, which has thrown the Bill into total chaos and confusion and led to tonight's debate. It is the Secretary of State who has created the chaos and confusion--

Mr. Stephen Milligan (Eastleigh) : Will the hon. Gentleman give way?

Mr. Wilson : Certainly not. When the hon. Gentleman has the guts to vote for the pensioners in the Eastleigh works, I will give way to him.

Today's events represent the final humiliation for the Bill and for the Secretary of State and confirmation of the reality that there is no majority for the Bill in the country, where polls have revealed that opposition to it stands at 83 per cent. There is no majority for the Bill in the leader columns of the Tory press or in Tory local authorities--even though there are not many of those left--and there is no majority for it among British Rail managers, 90 per cent. of whom have expressed their opposition to it, contrary to the

misrepresentation by the Secretary of State.

What we have seen tonight has been a constitutional outrage--I do not know the terminology used on these occasions--and a performance typical and worthy of the Government. Not only has the House and its right to debate

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been trampled on ; at the same time, the right to debate and consider legislation along the Corridor have been trampled on here. Some hon. Members who have been here for 30 years say that they have never seen anything like it ; I have heard some Lords say that they have been in the other place for 70 years and never seen anything like it.

The Secretary of State again adduces the interests of railway managers. He insists that they want to run private railways, in spite of the arguments, the statistics and the evidence of a lack of positive support for that. One of the greatest wrongs committed by the Secretary of State is to misrepresent the railway managers. He is driving them into a position of becoming involved in buy-out bids, forcing them into taking out mortgages on their homes to take financial risks. He does not even have the guts to admit that he is doing that for political reasons. He is persistently taking in vain the names of people who, by statute and regulation, he forbids to answer back.

In the weeks ahead, I challenge the Secretary of State to tell the chairman of British Rail that all rail managers are to be free to speak openly about their views on this legislation and the appropriateness of management buy- outs. He will find that the 90 per cent. who have told the survey that they are opposed to rail privatisation will come to the fore. It is a disgrace to drive people into management buy-outs as a way of protecting their employment, and then to persist in the falsehood that the majority are anxious to do that.

There are many Tory voters among the railway managers, but the Opposition will continue to speak for the 90 per cent. of them who do not want anything to do with these buy-outs. The Government can speak for the 10 per cent. who do. We shall speak for the 90 per cent. of railway managers who want to continue to run a safe, integrated public railway--many of whom are to be denied the right to do so. The hon. Member for Lewes (Mr. Rathbone) seemed, in his attempt to rationalise his own behaviour, under a serious misapprehension about what is in the Bill. Let there be no doubt : the state railways of Germany, France, Ireland and other countries will be in a position superior to that of British Rail if they choose to bid for BR franchises. None of those state railways will be subject to the four conditions that can be used by the franchise director to preclude British Rail involvement. [Hon. Members :-- "Wrong."] I repeat that none of them will be subject to the conditions that can be used under the Secretary of State's direction to preclude BR's involvement. There is a genuine question of competition at stake. No longer can Tory Ministers make up the rules as they go along. At some point they must answer to the laws of competition within a European context. One of the fixes in which the Government are engaging to try to encourage what remnant of private interest there may be is thus in contravention of European law--

Mr. Rathbone : The hon. Gentleman does not understand the matter any better than the Lords do. The Bill will say that British Rail can enter into these franchises ; it is only when there is no competition that the franchise director steps in.

Mr. Wilson : I think that Lord Peyton and Lord Marsh, not to mention hon. Members here who understand the

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Bill, have nothing to gain and nothing to hide--unlike those who engaged in a rebellion that collapsed before extracting a price. The new Lords amendment offered the genuine compromise which the hon. Member for Lewes and others like him failed to obtain. I do not like the amendment, in the sense that British Rail could still be the lowest bidder but be excluded from a franchise by the director. At least that represented a major advance, however, in that British Rail would have a right to bid in every instance. Under what the Government continue to propose, BR will often be excluded--not because it is not good enough, but because Ministers know that if it is allowed to bid it will succeed.

The arguments will go on outside this House. The Government have lost the argument. They have lost their dignity and their credibility on this Bill. Today we read of the latest attempt to win over public support for the Bill. We are told that the Department of Transport plans to send a leaflet to every house in the country explaining the benefits of rail privatisation. Millions of pounds that could be used to run trains will be spent on a propaganda battle that the Government have already lost. The only result could be another threat to rail traffic : leaflets on the track.

The hon. Member for Hampshire, North-West (Sir D. Mitchell) spoke of a tourniquet around the throats of railway managers who want to bid. I have always understood that the purpose of a tourniquet is to stop bleeding and save lives. Rather, this is a knife in the back of British Rail, and the Government have placed it there tonight. The debate goes on. It is understood in the country that rail privatisation equals higher fares, fewer services, and the loss of routes, of network benefits and of everything about the railway system that is widely understood in this country. The has-beens and never-weres on the Tory Benches can vote for the Government tonight and overturn the Lords amendment, but they will have to live with the consequences of their actions. Those consequences will be seen next year in the local government and European elections--and ultimately in the general election campaign, in which the future of the railways will play a major part.

Conservative Members can vote down the Lords amendment, but they cannot defeat the arguments. They have lost those arguments in the House. In the country, rail privatisation is discredited. This is the last hurrah for the Railways Bill. The battle goes on in the country from now on.

The Minister for Public Transport (Mr. Roger Freeman) : I am happy to live with the consequences of the Railways Act, as it will become. I firmly believe, as does my right hon. Friend the Secretary of State, that it will improve the quality of rail services, and that is the object of the exercise. Interestingly enough, tonight we have heard no reference whatsoever to passengers.

The purpose of the Bill is to improve the quality of service to passengers. It is not about preserving monopolies or preserving the rights of trade unions ; it is about improving service to passengers.

The hon. Member for Cunninghame, North (Mr. Wilson) referred to a matter that was raised in another place. Let me deal with it now. There is no question of

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printing 20 million leaflets to distribute to every household in the country. Hon. Members should not believe what they read in The Guardian ; there are no such plans.

The hon. Member for York (Mr. Bayley) said that we cannot substantiate in debate our arguments. Not only have we had 190 hours of debate, but we have dealt with the issues at great length. We spent two and a half hours on amendment No. 31 and we won by a majority of 34. We debated specific issues concerning the responsibility of the franchising director. [Interruption.] Yes, we did. Perhaps the hon. Member for Stoke-on- Trent, North (Ms Walley) was not listening to the debate.

9.30 pm

We discussed when the franchising director would exercise his responsibilities under clause 22 in order to disqualify British Rail from bidding in certain circumstances.

I speak for my right hon. Friend the Secretary of State for Transport-- [Interruption.] I am trying to make a serious point. In the Bill that we are considering tonight and when it receives Royal Assent, British Rail will be able to bid. My right hon. Friend and I firmly believe that British Rail

Mr. George Stevenson (Stoke-on-Trent, South) : Will the Minister give way?

Mr. Freeman : No. I was given only seven minutes and I must make my points.

British Rail will be allowed to bid in certain circumstances and it will undoubtedly win franchises. That was the intention of the House of Lords. We responded constructively and my right hon. Friend and I believe that that will happen.

Clause 22 gives the franchising director, at his own discretion, the right to determine, at the time of issuing the invitation to bid, whether British Rail is to be allowed to be one of those bidders. The criteria for deciding whether British Rail should bid are clear. The franchising director has to decide whether allowing British Rail to bid would not promote the interests of

management-employee buy-out bids that might confound new entry to the railway industry and would not in any way reduce the dominance of one supplier to the railway industry. That is what clause 22 said. The Lords amendment that deletes "issue invitations to tender" and inserts "award a franchise" is wrong. We debated it at great length and there are two consequences that I believe the House will understand when it votes in a few minutes' time and use as reasons for rejecting the Lords amendments.

First, if the franchising director is allowed to determine that British Rail should not be a bidder at the time of awarding the franchise, that puts British Rail management in a hopeless position. Are they preparing a bid themselves--a management and employee buy-out bid--or are they preparing a bid for British Rail corporate? It is a hopeless position and the direct consequence of the Lords amendments would be to prevent management-employee bids either being prepared or bidding.

Mr. John Gunnell (Morley and Leeds, South) : Will the Minister give way?

Mr. Freeman : No. Let me deal with the second consequence of the Lords amendments which we reject.

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Mr. Derek Enright (Hemsworth) : Get on to the passengers.

Mr. Freeman : The hon. Member for Kingston upon Hull, East (Mr. Prescott) did not refer to passengers at all. [Interruption.] No, he did not. We are motivated by one clear aim--to improve the quality of service for the passengers.

The second reason why we must reject the Lords amendments is that, if the franchising director allows British Rail to prepare bids in all circumstances and then decides to disqualify it at the time of awarding the franchise-- [Interruption.] I am speaking from the heart and the head also.

If we allow the franchising director to disqualify British Rail only at the final moment, at the award of the franchise, that would put off private sector bidders. They would undoubtedly be deterred by the cost and expense of preparing a bid, because they would face a state-owned company that is at present a monopoly. The net effect of the Lords amendment would be to deny the principal purpose of the Bill, which is to encourage and promote private sector interest in running passenger railways. That is what is in the Bill, and it is the prime purpose of our reforms--to introduce the benefits of additional capital and innovation.

The Opposition s real motivation tonight is nothing to do with the amendment ; they are determined to preserve British Rail's monopoly. The hon. Member for Kingston upon Hull, East threatened to sack British Rail managers who participated in the bidding process, and the hon. Member for Cunninghame, North said that he would renationalise the rail industry. The Opposition are determined to do one thing, and the one thing alone--to preserve British Rail's monopoly. But we are interested in promoting the interests of passengers. I commend what my right hon. Friend said, and urge the House to reject the Lords amendment.

Question put, That this House doth disagree with the Lords in the said amendment :--

The House proceeded to a Division :--

Mr. Deputy Speaker : Order. There appears to be some delay in the Lobby. Will the Serjeant at Arms please investigate?

Mr. Bob Dunn (Dartford) (seated and covered) : On a point of order, Mr. Deputy Speaker. If this practice of delay in the No Lobby continues, can those responsible be named?

The House having divided : Ayes 301, Noes 260.

Division No. 395] [9.35 pm

AYES

Ainsworth, Peter (East Surrey)

Aitken, Jonathan

Alexander, Richard

Alison, Rt Hon Michael (Selby)

Allason, Rupert (Torbay)

Amess, David

Arnold, Jacques (Gravesham)

Arnold, Sir Thomas (Hazel Grv)

Ashby, David

Aspinwall, Jack

Atkins, Robert

Atkinson, Peter (Hexham)

Baker, Rt Hon K. (Mole Valley)

Baker, Nicholas (Dorset North)

Baldry, Tony

Banks, Matthew (Southport)

Banks, Robert (Harrogate)

Bates, Michael

Batiste, Spencer

Beggs, Roy

Bellingham, Henry

Bendall, Vivian

Beresford, Sir Paul

Biffen, Rt Hon John

Blackburn, Dr John G.

Bonsor, Sir Nicholas

Booth, Hartley

Boswell, Tim

Bottomley, Peter (Eltham)

Bottomley, Rt Hon Virginia

Bowden, Andrew

Bowis, John

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Column 434

Boyson, Rt Hon Sir Rhodes

Brandreth, Gyles

Brazier, Julian

Bright, Graham

Brooke, Rt Hon Peter

Brown, M. (Brigg & Cl'thorpes)

Browning, Mrs. Angela

Bruce, Ian (S Dorset)

Budgen, Nicholas

Burns, Simon

Burt, Alistair

Butler, Peter

Carlisle, John (Luton North)

Carlisle, Kenneth (Lincoln)

Carrington, Matthew

Cash, William

Channon, Rt Hon Paul

Chapman, Sydney

Clappison, James

Clarke, Rt Hon Kenneth (Ruclif)

Clifton-Brown, Geoffrey

Coe, Sebastian

Colvin, Michael

Congdon, David

Conway, Derek

Coombs, Anthony (Wyre For'st)

Coombs, Simon (Swindon)

Cope, Rt Hon Sir John

Cormack, Patrick

Couchman, James

Cran, James

Currie, Mrs Edwina (S D'by'ire)

Curry, David (Skipton & Ripon)

Davies, Quentin (Stamford)

Davis, David (Boothferry)

Deva, Nirj Joseph

Devlin, Tim

Dicks, Terry

Dorrell, Stephen

Douglas-Hamilton, Lord James

Dover, Den

Duncan, Alan

Duncan-Smith, Iain

Dunn, Bob

Durant, Sir Anthony

Elletson, Harold

Evans, David (Welwyn Hatfield)

Evans, Jonathan (Brecon)

Evans, Nigel (Ribble Valley)

Evans, Roger (Monmouth)

Evennett, David

Faber, David

Fabricant, Michael

Fairbairn, Sir Nicholas

Fenner, Dame Peggy

Field, Barry (Isle of Wight)

Fishburn, Dudley

Forman, Nigel

Forsyth, Michael (Stirling)

Forth, Eric

Fowler, Rt Hon Sir Norman

Fox, Dr Liam (Woodspring)

Fox, Sir Marcus (Shipley)

Freeman, Rt Hon Roger

French, Douglas

Fry, Peter

Gale, Roger

Gallie, Phil

Gardiner, Sir George

Garel-Jones, Rt Hon Tristan

Garnier, Edward

Gill, Christopher

Goodlad, Rt Hon Alastair

Goodson-Wickes, Dr Charles

Gorman, Mrs Teresa

Gorst, John

Grant, Sir A. (Cambs SW)

Greenway, Harry (Ealing N)

Greenway, John (Ryedale)

Griffiths, Peter (Portsmouth, N)

Grylls, Sir Michael

Gummer, Rt Hon John Selwyn

Hague, William

Hamilton, Rt Hon Archie (Epsom)

Hamilton, Neil (Tatton)

Hanley, Jeremy

Hannam, Sir John

Hargreaves, Andrew

Harris, David

Haselhurst, Alan

Hawkins, Nick

Hawksley, Warren

Hayes, Jerry

Heald, Oliver

Heathcoat-Amory, David

Hendry, Charles

Heseltine, Rt Hon Michael

Higgins, Rt Hon Sir Terence L.

Hill, James (Southampton Test)

Hogg, Rt Hon Douglas (G'tham)

Horam, John

Hordern, Rt Hon Sir Peter

Howard, Rt Hon Michael

Howarth, Alan (Strat'rd-on-A)

Hunt, Rt Hon David (Wirral W)

Hunt, Sir John (Ravensbourne)

Hunter, Andrew

Hurd, Rt Hon Douglas

Jack, Michael

Jackson, Robert (Wantage)

Jenkin, Bernard

Jessel, Toby

Johnson Smith, Sir Geoffrey

Jones, Gwilym (Cardiff N)

Jones, Robert B. (W Hertfdshr)

Jopling, Rt Hon Michael

Kellett-Bowman, Dame Elaine

Key, Robert

Kilfedder, Sir James

King, Rt Hon Tom

Kirkhope, Timothy

Knapman, Roger

Knight, Mrs Angela (Erewash)

Knight, Greg (Derby N)

Knight, Dame Jill (Bir'm E'st'n)

Knox, Sir David

Kynoch, George (Kincardine)

Lait, Mrs Jacqui

Lamont, Rt Hon Norman

Lang, Rt Hon Ian

Lawrence, Sir Ivan

Legg, Barry

Leigh, Edward

Lennox-Boyd, Mark

Lester, Jim (Broxtowe)

Lidington, David

Lightbown, David

Lilley, Rt Hon Peter

Lloyd, Peter (Fareham)

Lord, Michael

Luff, Peter

Lyell, Rt Hon Sir Nicholas

MacGregor, Rt Hon John

MacKay, Andrew

Maclean, David

McLoughlin, Patrick

McNair-Wilson, Sir Patrick

Madel, David

Maitland, Lady Olga

Major, Rt Hon John

Malone, Gerald

Mans, Keith

Marland, Paul

Marlow, Tony

Marshall, John (Hendon S)

Marshall, Sir Michael (Arundel)

Martin, David (Portsmouth S)

Mates, Michael

Mawhinney, Dr Brian

Mayhew, Rt Hon Sir Patrick

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