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Sir Patrick Cormack (South Staffordshire): Why does not the Foreign Secretary break off the negotiations until all the vindictive and petty restrictions placed on the people of Gibraltar by the Government of Spain are ended? Why does he not go to Gibraltar himself and try

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to persuade its people that they have nothing to fear from the British Government? Why does he not go and win their trust and confidence before he starts to barter their future?

Mr. Straw: What the hon. Gentleman's question raises is the fact that there are many difficulties in the relationship between Spain and Gibraltar. Spain has many complaints about Gibraltar which we would be wise at least to acknowledge exist, even if we disagree with their substance. The way to resolve those difficulties is by constructive negotiation. Although it remains to be seen whether it will be constructive, that is the way forward and it is why I am involved in negotiations. And, yes, if it is appropriate, I will go to Gibraltar.

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Rail Strategic Plan

4 pm

The Secretary of State for Transport, Local Government and the Regions (Mr. Stephen Byers): With permission, Mr. Speaker, I should like to make a statement on the strategic plan for our railways, which was published this morning by the Strategic Rail Authority.

The plan's publication comes at a time when industrial action is being taken against a number of train operating companies. It is not for the Government to intervene directly in disputes between private companies and their employees. However, we do believe that in this day and age disputes of this nature should be settled by negotiation and not by strike action, which harms the travelling public and in the longer term has the potential to damage the railway industry itself. In those circumstances, the interests of the rail passenger must come first and, as the Prime Minister said last Wednesday, arbitration and the end to strike action should be, and would be, the best way forward.

Despite the efforts and commitment of many dedicated and motivated individuals who work in the industry, we do not have a railway system fit for the 21st century. That is due to two principal reasons. First, our railways have been subject to consistent underinvestment for almost three decades. In the 1970s and 1980s, there was an environment of political disinterest as far as the railways were concerned. That led to limited funding and investment, a situation that continued throughout privatisation during the 1990s.

The second reason for underperformance is the failed privatisation that was Railtrack. Five years after privatisation, Railtrack still does not have a register of its basic assets—track and signals. Costs of the west coast main line have escalated from £2 billion to perhaps some £7 billion, and it is only now, with a new management at the top, that the total mismanagement and failure to deliver on that project are becoming clear. The lack of investment in track maintenance was cruelly exposed at Hatfield, while at the same time £700 million was paid in dividends to Railtrack shareholders.

Both those problems—the lack of investment and the failed privatisation—have now been addressed by the Government. As the director general of the Confederation of British Industry, Digby Jones, said this morning,

Total investment each year over the next 10 years will average £4.3 billion in today's money. That contrasts with £1.4 billion in the final five years of the last Tory Government. [Interruption.]

Mr. Speaker: Order. Hon. Members should let the Secretary of State make his statement. He is allowed to do so.

Mr. Byers: The reality, of course, is that the Conservative party does not like to hear the truth. As a result of chronic underinvestment under the Conservatives, the total subsidy from the Government to the industry will increase to an average of £2.94 billion a year at current prices, directly and indirectly supporting the increased investment that it needs.

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We have said that we will provide £33.5 billion of public money to invest in our railways. The original provision in the 10-year plan for transport was £29 billion. The placing of Railtrack into administration on 7 October by the High Court means that we now have the opportunity of seeing a new licence operator for the network who will have one overriding priority—to put the interests of rail passengers first.

Against this background, the strategic plan is being published. It is just a start, but it is important because it is the first long-term plan for the expansion of the railway for nearly 50 years. It sets basic objectives, allocates funds, identifies priorities and sets a clear timetable for delivery. The plan forms part of the Government's agenda for modernisation of those essential services on which the public depend. Our approach is clear across all key public services. Whether in health, education, the fight against crime or transport, we invest in reform and insist on results. The results are clear from the strategic plan.

For the period between now and 2005, the priorities outlined in the plan reflect the need to tackle the current problems of poor performance and lack of reliability, to develop a new structure for the industry and to implement much-needed improvements across the country. Let us examine the detail of the improvements to take place between now and 2005. Specifically, 1,700 new carriages will be delivered by the end of 2004 to replace the 30-year-old slam-door rolling stock on the South Central, Connex South Eastern and South West Trains routes. [Interruption.]

Mr. Speaker: Order. I ask again that there be no shouting. The Minister is making a statement—a statement which the House asked for.

Mr. Byers: The problem, Mr. Speaker, is that the facts of what will be delivered are uncomfortable for the Conservatives. Let us go through the detail. As I said, 1,700 new rolling stock will be introduced by the end of 2004. By the end of 2003, the train protection warning system will be completed, preventing trains going through danger signals. Four hundred million pounds will be provided for a rail performance fund to help secure short-term improvements, and £430 million will be available for local schemes under the rail passenger partnership programme.

There will be major infrastructure and rolling stock investments in the west coast main line and cross-country routes. That will lead to significant journey time reductions on the west coast, and frequencies on cross-country services will be doubled, which will be of real benefit to major regional centres such as Birmingham, Liverpool, Derby, Bristol and Plymouth. There will be improvements at 1,000 stations. A new approach to franchising will be adopted which reflects the priorities of passengers and achieves a balance between getting the basics right in the short term and the need to invest for the long term.

The strategic plan contains a delivery commitment for each of the franchise areas, showing in detail the improvements to be made and the time scale for their implementation. In the medium term, the plan shows how to achieve the three core targets for the industry:

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increasing passenger growth by 50 per cent; increasing freight by 80 per cent; and reducing overcrowding in the London area. It also sets out a broader range of objectives, including improvements in safety, performance and quality.

Although the plan rightly focuses on the short and medium term, it is vital to plan for the long term. Major projects require detailed planning and analysis, robust contracting, and strong and competent project management and delivery. The plan makes provision for development work now towards longer-term potential projects. Those include major infrastructure improvements to the Great Western main line, new airport links, London crossrail and a new north-south high speed line.

Major investment must be directed to where it is most needed. Passenger demand is highly concentrated by market and route. About 70 per cent. of all passenger journeys made nationally use the network in the south-east. That means that we must focus investment on the main routes, both inter-city and commuter, which serve London. With the scale of investment provided in the 10-year plan, we can meet the needs of London and the south-east without diverting funds from the regional network. In addition, the refranchising of the regional franchises, almost all of which come to an end shortly, will provide the opportunity to improve services. The regional networks will also benefit significantly from the doubling of frequencies on cross-country services.

A particularly key role in the forward planning of the railways is being played by the devolved Administrations in Scotland, Wales and London. My colleagues in Scotland welcome the document and the vision that it contains of a safer, better and bigger railway system for Scotland in the future. The SRA's plan is designed to meet the needs of Scottish passengers and freight customers and contributes to the delivery of the Scottish Executive's document "Strategic Priorities for Scotland's Railways". Many of Scotland's priorities are addressed in partnership with the Scottish Executive and with the Strathclyde passenger transport executive. In particular, the plan refers to the development of Waverley station in Edinburgh to provide more capacity and better passenger facilities, and to work on rail capacity in the central belt and on rail access to Glasgow and Edinburgh airports.

The Welsh Assembly is making a significant contribution alongside that which is planned by the Strategic Rail Authority over the next five years, with enhanced rail infrastructure especially on valley lines and the Cambrian line. The Wales and borders franchise is being taken forward as a priority in the strategic plan. This provides a real opportunity to increase the quality and frequency of service, and I expect the new franchise to be operational early next year. A good start is being made with the opening of the Vale of Glamorgan line from Barry to Bridgend for passengers. Wales will also benefit from the commitments made on strategic services into London, including new rolling stock and track improvements. That is vital in improving communications for people in Wales as well as attracting business and leisure travellers to Wales. The Mayor of London is about to issue directions and guidance to the Strategic Rail Authority that will place a priority on better integration of railways with tube and bus services and on increased frequencies.

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We also need to do more to encourage freight on to our railways and off the roads. I recognise that a key element will be intra-European Union freight passing through the channel tunnel. The House will be aware of attempts to enter our country illegally through the tunnel. We must ensure that that does not happen and we will continue to press the French authorities strongly to provide the necessary security, both physically and through police presence at the freight yards on the French side. We have made good progress on Eurostar and that needs to be matched on freight as well. Under the plan, the freight facilities grant will be relaunched and there will also be a £300 million fund aimed at small-scale freight schemes.

Britain's railway is essential to the country's economic success and social development, and to environmental sustainability. Every day, the network carries 2.5 million passengers and 400,000 tonnes of freight. Each day, Liverpool Street station alone handles as many passengers as all the airlines carry through Heathrow. The railway industry is a key industrial sector employing 130,000 people. An efficient rail system would relieve road congestion and improve the competitive position of British industry.

It is six times safer to travel by rail than by car for each mile travelled. Rail is Britain's most extensive and co-ordinated national public transport system. We therefore need a railway that can deliver for our people and our country, and no more vague aspirations or grand visions that are strong on rhetoric but weak on delivery. The plan is an agenda for action. It shows what will be achieved for the large-scale investment that we intend to make in the next 10 years.

The strategic plan for railways draws a line in the sand and represents the point at which we say enough is enough. Let us take the necessary action and get on with providing a railway that is fit for the 21st century and the country with the fourth largest economy in the world. The plan will make an important contribution towards achieving that objective and I commend it to hon. Members.

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