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County Councils

4. Mr. George Osborne (Tatton): If he will make a statement on the future of county councils. [55530]

The Minister for Local Government (Mr. Nick Raynsford): Our proposals for county and district councils, where an elected regional assembly is to be established in future, are set out in chapter 9 of our White

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Paper, "Your Region, Your Choice", published on 9 May. Any move to a wholly unitary structure would apply only in those regions which vote in a referendum to establish an elected regional assembly. We have no proposals to change the structure of county and district councils in other circumstances.

Mr. Osborne: Does the Minister agree that people in England identify with their city, town or county, but not with an amorphous, vast administrative region? Will he confirm that, even if every voter in Cheshire, Lancashire and Cumbria in the north-west region votes against a regional assembly, they can be outvoted by Manchester and Merseyside? Is that local democracy?

Mr. Raynsford: People in many regions of the United Kingdom identify strongly with their region. If the hon. Gentleman visited the north-east, he would find that out. On elections, we have always operated on the simple principle that majorities prevail. That will apply in any referendum.

Mr. Andrew Miller (Ellesmere Port and Neston): Does my right hon. Friend agree that the White Paper does not provide for a third way? The electorate will have a choice between staying as they are or voting for a unitary structure supported by a regional assembly. Does he also agree that, in the context of Cheshire, voters should consider the successes of the unitary authorities in Halton and Warrington, and cast their vote on that basis?

Mr. Raynsford: The purpose of a referendum is to judge public support for creating an elected regional assembly, but when people cast their votes, they should consider the likely consequences for the reorganisation of local government to create a wholly unitary structure. That is why the White Paper proposes that that should be identified, through a study by the boundary committee, before people cast their vote in the referendum, which will rightly determine the outcome for their region.

Mr. Don Foster (Bath): In the light of the Minister's answer, what precisely did he mean on 5 March, when he said,

In view of his reply to the hon. Member for Ellesmere Port and Neston (Mr. Miller), what advice would he give to a voter in a referendum for a directly elected assembly if that person not only supported an elected assembly in his or her region, but wanted to retain a county council?

Mr. Raynsford: The hon. Gentleman has not been listening carefully. I made it perfectly clear that people's primary consideration in the referendum is whether they want an elected regional assembly. The Liberal Democrats have advocated regional assemblies for a long time, but the hon. Gentleman has suddenly become rather coy about it. We have made it clear that people should be conscious of the implications for local government if they vote for a regional assembly. That is why we are asking the independent boundary committee to consider the

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appropriate structure for a wholly unitary pattern of local government. We have no agenda for abolishing county councils.

Mr. Tony Clarke (Northampton, South): The hon. Member for Tatton (Mr. Osborne) champions the case for the status quo but many hon. Members would like the rights of unitary, one-stop local governments to be afforded as soon as possible to electors in England, as it is in Scotland and Wales. What does my right hon. Friend say to the electors of Northampton, who were promised and denied unitary government in 1996? The then Secretary of State said that it was a mistake and that there would be a review. My right hon. Friend's answer today does not give us hope that the review is forthcoming.

Mr. Raynsford: We are aware that in some areas—Northampton is one—many people strongly believe that a unitary structure of local government would be of benefit to them. Having said that, the Government's view is that, over the next few years, the overriding priority should be to deliver on our local government agenda for raising the standard of service delivery, and that a widespread review of local government structures would not help to achieve that objective. That is why we are saying clearly that there should be such a review only in the regions in which people wish to establish an elected regional assembly. Without such a review, there would be an unnecessary third tier of government below the national level. That is why we are approaching the issue in an extremely sensible and pragmatic way with a view to ensuring that local government concentrates on the primary objective of raising the standard of services.

Mr. Malcolm Moss (North-East Cambridgeshire): It really is time the Minister came clean and admitted that county councils will no longer exist in their present form if and when regional government is introduced. As the condition set by the Government for regional government is that councils should be reorganised into unitary councils, will the Minister confirm that such a reorganisation could cost up to £2 billion if all eight regions opted for regional government? For that huge cost, we would get not one extra teacher, not one extra social worker, and no improvement whatever in local councils' basic services. So what is the point?

Mr. Raynsford: It is interesting that the hon. Gentleman should seek to dredge up figures in the usual Conservative way to imply that there will be huge costs involved in reorganisation. The only pointer that I can think of for his figures is the extraordinary waste of time and money during the Banham review, which his Government set up in the 1990s and which created exactly the climate of chaos and confusion in local government that we are determined not to replicate. It is pretty rich of the Conservatives, who have an extraordinary record—[Interruption.] If the hon. Gentleman will contain himself, I will answer his question. It is pretty rich of the Conservatives, who abolished county councils in Humberside, Avon, Cleveland and Berkshire, to accuse this Government of having an agenda for abolishing local government. We do not.

Jim Knight (South Dorset): I am a keen supporter of regional government, and I look forward to the prospect

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of unitary local government in shire counties. When the boundary commission considers this matter, however, I would urge it to consider unitary county councils, and a strengthened role for town and parish councils. What discussions has the Minister had with his colleagues at the Department for Environment, Food and Rural Affairs, who have responsibility for parish councils—bizarrely, in my opinion—on the future of town and parish councils under a regional government structure?

Mr. Raynsford: My hon. Friend rightly highlights the important role that the boundary committee will have in determining the appropriate and best structure for unitary local government in those regions that opt for elected regional assemblies. Clearly, this will best be determined by an independent body, which is why we have given the task to the boundary committee. It will need to consider whether a structure based predominantly on the county or on the district is the most appropriate in each circumstance. This will therefore be an entirely objective and fair appraisal with no presumption one way or the other. On the role of parish councils, I am sure that the concerns of parishes can be brought to the attention of the boundary committee wherever it is conducting such a review.

Sir Patrick Cormack (South Staffordshire): As the Minister believes so strongly in regional government, will he give three reasons why any voter in rural Staffordshire or any other shire county should abandon county hall for government by 25 elected people in a vast region with which they cannot identify?

Mr. Raynsford: I will give the hon. Gentleman three very simple reasons. First, it could well help to achieve more effective regional co-ordination on matters that are best dealt with at a regional, rather than local, level. For example, transport planning cannot logically be undertaken at county level. It is best undertaken at a regional or national level. Secondly, it will help to ensure that there is proper regional accountability for services that are currently discharged in that region by quangos and other bodies which the Conservative party loved but which are unaccountable. Thirdly, it will help to ensure economic development, which should be the priority in every region. It is the Government's priority to help all the regions to prosper.

South West Trains

5. Dr. Vincent Cable (Twickenham): If he will make a statement on the progress of new franchise negotiations for South West Trains. [55531]

The Secretary of State for Transport, Local Government and the Regions (Mr. Stephen Byers): The Strategic Rail Authority remains in negotiation with Stagecoach Group plc, which operates the current South West Trains franchise.

Dr. Cable: South West Trains is probably even less popular in my constituency than the Secretary of State. Does the right hon. Gentleman agree that it needs certainty to plan long-term investment? How has he responded to the specific proposal made more than a year ago that the operating companies take over track

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maintenance? Unlike the subcontractors, who have every incentive to cut corners, the operating companies have a long-term incentive to maintain safe and reliable trains over a 20-year franchise period.

Mr. Byers: The South West Trains franchise is of particular importance because it is the biggest rail passenger franchise that operates in the United Kingdom. The negotiations are taking time because the franchise process must be used to drive up standards and improve the reliability of the service for the hon. Gentleman's constituents and other passengers who use the South West Trains franchise area.

On the specific point about the integration between the franchise operator—the franchise holder—and the maintenance and renewal of the track, Stagecoach Group plc has said that it is interested in taking on that responsibility. The Strategic Rail Authority is giving that proposal some consideration, but we need to work through the detail of exactly what is being proposed before any final decisions are taken. However, in the light of what happened at Potters Bar—although it is too soon to prejudge the conclusions of the Health and Safety Executive investigation—and in view of the Transport Committee's recommendations following the Cullen report, it is very clear that there needs to be a fundamental review of the role played by contractors and subcontractors in the maintenance and renewal of railway track.

Mrs. Gwyneth Dunwoody (Crewe and Nantwich): My right hon. Friend will be aware that the history of the franchise is a difficult one. I ask him to guarantee that whoever gets it will demonstrate an absolute commitment to producing very high-quality services for the passengers which has frankly not been the situation in the immediate past.

Mr. Byers: I agree with my hon. Friend that the South West Trains franchise is not being operated as well as anybody would like. Its performance levels are not acceptable. I want the Strategic Rail Authority to use the franchise renewal as an opportunity to secure real improvements for the travelling public. The SRA recognises that the franchising process is one of the key levers that it has to improve the standard of service offered to the travelling public. The existing franchise is due to be concluded; it comes to an end in February of next year and can be extended by a further seven months. The Strategic Rail Authority must use the time over the next few months to negotiate an agreement with South West Trains—with Stagecoach Group plc. If the SRA cannot negotiate a franchise renewal that puts the interests of the travelling public first, it will be prepared to seek a new franchise operator which will put the interests of the travelling public first, drive up standards and improve reliability.

Mr. Eric Pickles (Brentwood and Ongar): What the Secretary of State has just said is very interesting. Prior to his announcement, there was an assumption in the industry that the negotiations would be concluded by July of this year. Now it is clear that they will drag on, possibly for a further year. Already we have had 14 months of indecision. The Secretary of State suggests that this is a natural process, but anybody close to the negotiations will

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tell him that they are bogged down. The result is that there will be considerable delays in introducing passenger benefits, replacing the mark 1 slam-door trains and increasing capacity. The Government are having to underwrite the cost of new trains. These delays are damaging the confidence of the industry. Does the right hon. Gentleman agree with the Strategic Rail Authority's statement that the franchise negotiations are like "treading in treacle"? As a man who has delivered more than a dollop of treacle to the railway industry, what is he going to do to get himself out of this mess?

Mr. Byers: The position is that the negotiations with Stagecoach Group plc are continuing. The point that I was making is that, if they are not concluded, there is time for the Strategic Rail Authority to negotiate with a new franchise holder if appropriate. The negotiations are not delaying improvements, which are being introduced. The programme for replacing slam-door trains is on schedule, and new class-458 trains are being introduced to increase capacity. The negotiations are taking time because we need to make use of this opportunity. In terms of passenger numbers and revenue from ticket sales, we are talking about the biggest franchise in the whole of the United Kingdom, and this is a golden opportunity to improve the standard of service for the travelling public.

The Conservative party would sign up to anything, and we have seen the consequences of that approach. This is an opportunity to bring about real improvements for passengers who travel on South West Trains. We want the Strategic Rail Authority to deliver real improvements to the travelling public, and it will.

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