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Mr. Cook: My hon. Friend raises an issue that is obviously very important to his constituency and others in the south-east. We have published the Bill in draft form precisely so that voices can be raised and concerns and views expressed about what is proposed. I am keen to ensure that the Select Committee on Transport, Local Government and the Regions has the opportunity to carry through its pre-legislative scrutiny of the Bill, in which it will address a number of such issues of concern. The more Bills we publish in draft, the better we will be able fully to examine them before the House is faced with debate on an official Bill. I advise him to ensure that his voice is heard by the Department and the Select Committee as these matters are considered.
Mr. Michael Fallon (Sevenoaks): Is the Leader of the House aware that in the past few weeks Swanley town council in my constituency has had to spend around £16,000 to move on three encampments of so-called travellers and to clear up after them? It is a difficult problem, but could we have an early debate in which the Government can put forward proposals that might make it easier to move on illegal encampments and to reimburse the costs that unfairly fall on very small town and parish councils?
Mr. Cook: Many hon. Members, myself included, are familiar with the problem to which the hon. Gentleman refers, and we have made efforts to deal with it in the past. He will know that it is a difficult and complex issue that is not readily amenable to a simple legal solution, but the Office of the Deputy Prime Minister, which now covers local government, is examining it to see whether we can take further steps that would be helpful.
Mr. David Chaytor (Bury, North): Does my right hon. Friend agree that the world summit on sustainable development that will open in Johannesburg in August is a conference of enormous importance, not least for its potential to bring the United States Government back into the frameworks of international agreement on
environment and development policies? Notwithstanding his earlier announcement that there will be a general debate on sustainable development in European Standing Committee C next week, will he provide Government time in the near future for a debate on the Johannesburg summit on the Floor of the House?
Mr. Cook: I entirely share my hon. Friend's commitment to the importance of the summit. It is important that we review where we stand 10 years after Rio and that we understand that, if we want to ensure that we preserve the climate and environment of the globe, we must have international decisions that secure that. I particularly welcome the summit's focus on tackling the environmental hazards experienced by the poorest people on the earth. A very simple environmental right will be access to clean water, which could remove the scandal that 2 million children die each year from drinking contaminated water. If we can get progress on that, the summit will have been well worth while. I will consider at what stage it might be appropriate for the House to hear about those matters and to what extent we can provide for that, given that we must balance it with the other commitments of business in the House.
Dr. Vincent Cable (Twickenham): The Leader of the House will recall the very prominent role that he played in relation to the Scott report on the Iraq supergun. Will he suggest the best way of initiating a comparable investigative inquiry into the equally scandalous Tanzania air traffic control deal, and commend it to his colleagues?
Mr. Cook: I fully rebut any parallel between those two events. The Scott inquiry flowed from two things—first, the totally secretive basis on which the rules on exports to Iraq were changed without any report to the House or comment in public and, secondly, the subsequent attempt to prosecute and convict business men who had acted fully in connivance with the Government, who denied their own role. There is no parallel with the Tanzanian air traffic control case. Whatever hon. Members may think of that decision, it is in the public domain, it was fully aired in exchanges in this House and in Westminster Hall, and nobody has made any attempt to bring false prosecutions.
Mr. Mark Francois (Rayleigh): Can the Leader of the House find time for a debate before the summer recess on new regulations, which come into force next week, governing access to local authority planning registers by those who wish to undertake searches as part of a house purchase? The regulations threaten the livelihoods of several successful private companies that offer a service to clients wishing to search such registers, because they will impede the ability of those companies to carry out searches. The regulations threaten the viability of a number of successful small businesses and threaten to slow up the whole process of carrying out searches on behalf of those who wish to purchase houses. That is an important issue, so can the Government provide time for a debate before the recess?
Mr. Cook: I am not sure that I can promise a debate in the Chamber before the recess because we have a crowded schedule. The hon. Gentleman raised some important points and goes some way towards reinforcing the case
for a sifting committee to identify secondary legislation that requires debate. In the meantime, I shall draw his comments to the attention of the relevant Department.
Dr. Julian Lewis (New Forest, East): Will the Leader of the House use his best endeavours to persuade the Chancellor of the Exchequer to be one of the Ministers responding to Tuesday's all-day Opposition day debate on the crisis in the funded pensions industry? The Chancellor could then explain precisely when he realised that his devious scam of raiding pension funds to the tune of £5 billion a year would come home to roost during his Chancellorship, not many years hence, as he obviously intended.
Mr. Cook: Decisions about who takes part in Opposition day debates are matters for the Government collectively, and we shall give due weight to the hon. Gentleman's representation. He asks about the precise point at which somebody changed their mind. Last Thursday, he mentioned opinion polls that showed that the Conservatives were on the way up. When precisely did he change his view on opinion polls? Was it possibly on Monday, when he read the latest poll, which put the Conservatives two points down and 10 points behind?
Mr. Roy Beggs (East Antrim): Does the Leader of the House agree that employees throughout the United Kingdom should be treated equally and have equal rights? Will he read early-day motion 1498, which draws attention to a loophole in the law?
[That this House deplores the behaviour of Argos, who are ruthlessly exploiting a loophole in the law, whereby shop workers in Scotland are not given the protection which is enjoyed throughout the rest of the United Kingdom, and sacking staff who between them have given years of loyal service to the company if they will not accept compulsory Sunday working, thus discriminating in particular against those who have family commitments or religious objections, and in general against employees in Scotland.]
Argos is exploiting that loophole, and employees who, for personal or religious reasons, do not wish to work compulsorily on a Sunday are being sacked. Will the right hon. Gentleman take steps to plug the loophole?
Mr. Cook: My hon. Friend the Member for Aberdeen, North (Mr. Savidge) raised that matter in business questions last week on behalf of his constituents who work for Argos.
We are not considering a loophole, but the fact that the legislation in Scotland pre-dates that in England. The legislation in England includes specific safeguards for religious and other principled objections to working on a Sunday. There has not been a problem in Scotland so far. As I said last week, I deeply regret that the company is not following the practice of other Scottish companies, which have worked on Sunday for many years, but managed to do so amicably, with the voluntary agreement of their staff. I hope that, even at such a late stage, the company will consider coming into line with normal practice.
Richard Younger-Ross (Teignbridge): In a debate on social care in January, the Minister of State, Department of Health, the hon. Member for Redditch (Jacqui Smith), said that there would be an inquiry into why health authorities in the south-west were diverting money from services for the elderly to child care. I raised the matter with the Leader of the House, who promised to write to the Health Minister to ascertain whether there would be a statement and whether I would receive a response. I have written to the Health Minister, but I have not received a response. Does it take the Government six months to make an inquiry? How long does it take a Minister to reply to a letter from a Member of Parliament?
Mr. Cook: I am punctilious in drawing the attention of the parliamentary Clerk of the appropriate Department to matters that are raised in business questions. I shall ensure that we pursue the matter and try to get a reply for the hon. Gentleman.
Network Rail
1.18 pm
The Secretary of State for Transport (Mr. Alistair Darling): With permission, Mr. Speaker, I should like to make a statement on progress in putting the ownership and operation of the rail network on a sound and sustainable footing, and, as part of that, steps to get Railtrack out of administration.
I shall keep the House informed over the next few weeks, but in the light of the conclusion of the sale and purchase agreement this morning between Railtrack Group and Network Rail, I thought it right to come to the House to set out the Government's strategy, progress so far and the next steps.
As the House knows, the High Court put Railtrack into administration last October. As the presiding judge said, the making of the railway administration order was
- "not only appropriate, but absolutely essential".
On the 25 March this year, my right hon. Friend the Member for Tyneside, North (Mr. Byers) told the House of the bid made by Network Rail to acquire Railtrack from its parent company, Railtrack Group plc. Although other bids would have been considered, none was received. Network Rail is a public interest company limited by guarantee, and will be run for the benefit of the whole railway, concentrating on its core priorities of operating, maintaining and renewing the rail network. There will be no shareholders, and any operating surplus will be used for the benefit of the railway system.
The company will operate on a sound commercial basis with a board and management whose performance targets will be aligned to the Strategic Rail Authority's long-term plan, as well as to the obligations to its customers under its network licence. Its directors will be accountable not to shareholders but to the company's members, who will be drawn not only from the rail industry, but will include members representing the public interest and the Strategic Rail Authority. In this way, the directors of Network Rail will be answerable to people whose primary interest is in the long-term future of the railway.
Railtrack Group and Network Rail have now concluded a sale and purchase agreement to acquire Railtrack plc. I would like to set out in some detail the terms of that agreement. In line with its original offer, Network Rail will pay £500 million—of which £300 million will be provided by the Government—as well as taking over Railtrack's debt, which now stands at £7.1 billion. This includes loans from the European investment bank and the German bank, KfW, totalling just over £1 billion, which Network Rail plans to assume.
In parallel, London and Continental Railways is acquiring from Railtrack its interest in the first phase of the channel tunnel rail link for £295 million. At a cost of
£80 million, Network Rail will acquire the right to operate, manage and maintain the channel tunnel rail link and the concession to manage St. Pancras station. I can tell the House that Network Rail has already secured up to £9 billion of bridge financing from commercial banks to fund its acquisition costs and to refinance Railtrack's existing debt, as well as to fund the immediate operation of the railway.Network Rail will also put in place additional commercial financing of up to £7 billion for its medium-term requirements. This is necessary to cover operational expenditure as well as to cover substantial cost overruns inherited from Railtrack, which will have to be met. Network Rail will also need—as would any owner and operator—access to back-stop contingency funding. For this reason, the SRA will provide additional standby credit facilities; this contingency funding of last resort has been set at £4 billion. Further details of this funding and of the short-to-medium-term standby credit facilities offered to Network Rail by the Strategic Rail Authority are set out in the two minutes that I am laying before the House in the normal way. The House will also wish to know that the Rail Regulator has today issued a statement setting out his approach to a request for an early regulatory review.
These are large sums by any standards, but they are necessary, given the size of the task facing Network Rail, and they would be needed by any successor to Railtrack. There is no escaping the fact that Britain's railways need very large-scale investment—investment that we believe is essential. It is because of the need for long-term sustained investment that the Government are, through the 10-year plan, increasing the average annual investment in the railways—on top of continued support for running costs—to £4.6 billion. That is more than three times the annual average in the 10 years prior to 1997.
The public are entitled to expect that this investment will be spent efficiently and effectively. That has clearly not been the case in the past. The new company, Network Rail, faces a legacy of poor management, and of very substantial cost overruns which will have to be met. For example, when it began, Railtrack estimated that the cost of the west coast main line project would amount to about £2 billion. It is now clear that the actual cost of the work will be considerably more than that. What is now needed is a competent owner and operator, which is why Network Rail's acquisition of the railway network is so essential to the future of the railways.
This agreement is a major step towards removing Railtrack from administration and putting the rail network back on a sound footing. The next stage in the process will involve Railtrack Group plc putting this offer to its shareholders at a special meeting, which is expected to be held next month. It is for the company to decide how much it can offer its shareholders.
The European Commission is also considering whether any aspect of the support being provided needs to be cleared as state aid. However, if the shareholders of Railtrack Group approve the bid at the special meeting and the appropriate clearance is obtained from the Commission, I expect to ask the High Court for an order releasing Railtrack plc from administration thereafter.
It is obvious that Railtrack could not have carried on as it was. Even the company recognised that last summer. What is more, the division and lack of common purpose
that characterised the railway system during the last few years was damaging and destructive to the interests of both the industry and the travelling public.All the evidence shows that working together is crucial to the long-term success of the railway network. Over the past few months, despite the uncertainties of administration, the new management of Railtrack has enjoyed closer working relationships with the Strategic Rail Authority as well as the Rail Regulator and the train operators—which is essential if the network is to work effectively and efficiently to everyone's benefit.
The establishment of a public-interest company in which the Strategic Railway Authority is represented will continue to foster this climate of better co-operation to the benefit of all concerned in terms of achieving the objectives set. The railways are critically important to the economic and social fabric of the country. There is now an urgent need to give the rail system stability, and I believe that this agreement is the right and best way of building a modern and efficient network.
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