Select Committee on Public Accounts Minutes of Evidence

Examination of Witnesses (Questions 180 - 199)



  180. Do we not already bear all the risk, are we not piling money into a system that is clearly failing? We have inherited a fragmented system, we are throwing money into a fragmented system. Do you think it would be a good idea if we had a greater share?
  (Mr McGann) It would be a good idea if we can reach a situation where we can utilise the public sector funds to lever in more private sector money for railways, that would be a good idea.

  181. Do you agree if there was greater equity from the public sector that Railtrack would be able to borrow more from the city?
  (Mr McGann) I do not think that is necessarily the case.

  182. That was Gerald Corbett's view. In terms of speed, my understanding is that the record for a steam engine in Britain is 126 miles per hour, that was the Mallard in 1938, we are still doing 125 on Intercity trains, and the French are doing 320 mile an hour trains. What is your strategic vision for the growth in the average speed of British trains moving towards the French level?
  (Mr Grant) From a strategic point of view we would want to look at 140 miles an hour, which is the proposition on the West Coast Mainline.

  183. You mentioned looking at the structure, you have been looking at these working groups, are you ruling out the idea of having some sort of inventive private/public partnership along the lines as I was saying, about equity and borrowing, because of the fears of a hiatus?
  (Mr Grant) That is not our mandate at the moment. If the working groups conclude that something needs to be done about structure, we will address it at the time.

  184. I talked about speed and fares. In terms of volume the French use double-decker trains, is there any prospect of us having extra capacity? I know there is the physical problem of rails. When are we going to be able to have double-decker trains in Britain?
  (Mr Grant) There is an economic analysis there. I believe that South-West trains have publicised they are looking at double-decker trains.

  185. Does anybody have any idea when we might expect double-decker trains?
  (Mr Grant) If South-West trains were successful in their franchise replacement I guess you would be looking at a five to ten year period.

  186. In terms of the situation on overcrowding, would you agree that the problem of overcrowding in simple terms is there are more people wanting to go on trains and the growth in trains is due to congestion on the roads and one million people in jobs is far ahead of the supply side? As a Strategic Rail Authority, will you ensure that comes into balance in the next few years? When will it come into balance?
  (Mr Grant) As you will see in the report, the major element the report identifies is an increase in infrastructure and for that infrastructure we are talking about a five to ten year time frame.

  187. Finally, in terms of customer complaints and consumer confidence, you will be aware that various operations, like Macdonald's, whoever it is, have leaflets and they say to their customers "please fill in this leaflet, tell us what you think". Do you think it is a good idea for train operating companies to have leaflets in their stations so that passengers can fill them in as they are sitting in queues and can give their suggestions so you get a true idea of the dissatisfaction that the public feels about the rail system in Britain?
  (Mr Grant) I will certainly take that comment on board. The major element of our approach has been through the National Passenger Survey where you can get a more accurate picture than from the trains, but clearly some of that may be a good thing to do.


  188. Before we lose sight of the question, can the Treasury tell us what the holding in Railtrack is by the Government?
  (Mr Grant) It is one million shares but I do not believe it is held through the Strategic Rail Authority.
  (Mr Dennis) The Strategic Rail Authority has not been formally vested yet.

  189. Presumably that is the intention. Mr Williams asks have you lost them?
  (Mr Glicksman) Can we give you a note on that[1], Chairman?

  Chairman: That would be helpful, yes. Let me know if they are on a GNER train going forward.

Mr Davidson

  190. Do I take it from what you have been saying that it is your view that the present franchises are too soft and they allow people to get away with lax behaviour?
  (Mr Grant) I can certainly say the franchises going forward will have more stringent requirements.

  191. That was not what I asked you. I asked you whether or not you believe that the present ones are too soft?
  (Mr Grant) For the amount of investment that we are putting into the railways going forward we will demand more from the franchises than is in place at the moment.

  192. Shall I ask you again then. Do you believe that the existing franchises are too soft?
  (Mr Grant) In some cases they have been easy to achieve, in other cases they have not.

  193. Thank you. If I assume that some of the existing franchises are to be sold in order to simply get the whole rail privatisation rolling and the Government will be able to settle for what they can get, is that a reasonable view?
  (Mr Grant) I believe, talking to a number of people, that the early franchises were let on more generous terms than the later ones in terms of the programme that took place of privatisation.

  Mr Davidson: I was really interested in your point about the correlation between early privatisation and the level of profitability. In order to sustain that it would be helpful if we could have some evidence of how you came to that conclusion.

  Chairman: Can we have a note on it[2]?

Mr Davidson

  194. That would be helpful. Can I go back to the point you made at the very beginning, I think in response to the Chairman, I just want to get this absolutely clear. Are you saying that under the regime that you are starting to renegotiate that it could be 20 years before 15 out of 16 trains run on time?
  (Mr Grant) That could be the case.

  195. Do you regard that as acceptable? Do you think that we should regard it as acceptable?
  (Mr Grant) There is a question about the level of investment you believe is necessary to achieve 15 out of 16 trains. Of the two franchises that have been let so far, one is planning to achieve it by 2004 and the other one by 2010. What we have said is we want it to be achieved earlier than 20 year, so I am saying we would expect it to be achieved within the life of the franchise but the evidence to date is that we will get it earlier on some and later on others.

  196. Are you on performance related pay at all?
  (Mr Grant) No.

  197. Are any of the staff in your organisation on performance related pay?
  (Mr Grant) Some are. The organisation contains people under British Railways Board contracts, people under OPRAF contracts, some under Department contracts and, in future, Office of the Rail Regulator contracts.

  198. Is there anybody in your organisation who loses money if trains are late?
  (Mr Grant) Not directly, no.

  199. I wonder if I could just ask you a point relating to page five, paragraph 12. I just want to be clear about this point about the trains. It says "The Authority would consider adjustments to fares to encourage passengers to avoid the high peak." You indicated at one point during your answers that it would not be your intention to price people off the railways, do I take it that there will be off-peak reductions or is it more subtle than that?
  (Mr Grant) What we were looking at was whether people would be prepared to travel in the shoulders just outside the peak. There has been some evidence of that on the c2c franchise. That was the idea behind that.

1   Note by Witness: I can confirm that the Government holds just over one million shares in Railtrack through the Department of the Environment, Transport and the Regions. They are the residual amount of the shareholding that the Secretary of State retained to pay bonus shares to those who bought at flotation and elected the "bonus share" option if they held the shares for three years. Claims for bonus shares are still being received. Back

2   Note: See Evidence, Appendix 1, page 24 (PAC 2000-2001/52). Back

previous page contents next page

House of Commons home page Parliament home page House of Lords home page search page enquiries index

© Parliamentary copyright 2001
Prepared 18 July 2001