Members present:

Mrs Gwyneth Dunwoody, in the Chair
Andrew Bennett

Mr Gregory Campbell
Mrs Louise Ellman
Chris Grayling
Helen Jackson
Miss Anne McIntosh
Mr Bill O'Brien
Dr John Pugh
Mr George Stevenson


Examination of Witnesses

RT HON JOHN SPELLAR, a Member of the House, Minister for Transport, and MR MARK COULSHED, Divisional Manager, Railways Sponsorship Division, Department for Transport, examined.


  1. Good afternoon, Minister. We are delighted to have you with us. Would you be kind enough to tell us who you are?
  2. (Mr Spellar) John Spellar, Minister for Transport and I am with Mark Coulshed, Head of the Rail Sponsorship Division.

  3. Thank you very much indeed. Did you want to have a few minutes to yourself to tell us what we should know, Mr Spellar?
  4. (Mr Spellar) No, I think I am quite happy to move into questions on quite a wide-ranging topic.

  5. Good, so can you assure us firstly that the Department knows the difference between maintenance and renewals as opposed to upgrades and enhancements?
  6. (Mr Spellar) Yes, I think so, but I wonder why there is a question on that.

  7. Because we have taken quite a lot of evidence that it is not necessarily so that enhancements are going to be given the same priority, but can I ask you is it not commonsense to assess whether a piece of track can be upgraded when it is being renewed?
  8. (Mr Spellar) Well, all the time, if we are looking at Railtrack, and this would obviously be true right the way across the system, they should be looking towards through-life costing and, therefore, assessing the need for maintenance, but also of course a rolling programme of renewal. Now, in one sense what that means is that they actually have to have a clear view of their assets and a clear register of their assets and, as the Committee will be aware, one of our concerns which has been heightened since Railtrack went into administration and the new management have come in is that there was a significant deficiency in their understanding of their assets, let alone of their cost base, and the new management is having to wrestle with that.

  9. We do understand that, Minister, but I think what concerns us is that we would really like to know whose responsibility it is going to be. Will it be Network Rail, who have no remit for enhancements, or the Strategic Rail Authority?
  10. (Mr Spellar) Well, the whole question of Network Rail and the role of Network Rail, although it will obviously be more widely discussed when we are able to make an announcement on this subject once negotiations have been completed and the Secretary of State is able to make ----

  11. Yes, but presumably you have thought about this division of responsibility because the new company coming in is not exactly a secret, is it? We not only know that we need it, but you have been working on it for some quite considerable time.
  12. (Mr Spellar) This is true.

  13. So you must have thought about who is going to be responsible for this rather important division.
  14. (Mr Spellar) True, Chairman, but I think also I am slightly constrained by the final details and the detailed announcement which will probably be made to the full Chamber of the House of Commons.

  15. I see, on something as specific as that?
  16. (Mr Spellar) Well, just generally on the question of Network Rail and of the new arrangements and the finalisation of the deal.

  17. Well, can I then ask you about engineering works. Their costs are going up in bounds and bounds and they have been criticised for offering poor value for money. What solutions have you got in mind for that?
  18. (Mr Spellar) Well, I think there are a number of areas which Railtrack will be addressing and of course that applies not just in the north, but right the way ----

  19. Network Rail!
  20. (Mr Spellar) No, but Railtrack at the moment have been addressing under Railtrack in administration, under the management on the operational side, have been examining the system operating, particularly because they have a number of examples where outside contractors, outside of the main contractors, would have been able to bid for doing work considerably less than Railtrack. I had an example yesterday when I was in Yorkshire, this is a small station improvement and a difference of over 1 million between the estimate from Railtrack and the estimate from another builder. That is a good example, I think, of the variation in cost. In quite a number of cases Railtrack have been contracting work out and again, as an example of their failure to understand or control their costs, therefore, paying far more for those services than they would have done in a proper contracted environment, and I am sure that the current Railtrack management and then Network Rail will be looking at how they can rationalise that work and actually get costs which are more comparable with both costs and indeed the rate of return which prevails in the commercial sector.

    Chris Grayling

  21. Minister, there has been widespread speculation that extra funding will be announced along with the Network Rail announcement. I do not expect you to confirm the amounts, but can I ask you, particularly given the evidence we have been hearing this afternoon about the situation in Manchester and the proposal for Manchester which has been delayed beyond the ten-year time period, can you give us an indication of whether any of that funding would be available for some of the projects which have been pushed outside the Ten-Year Plan?
  22. (Mr Spellar) I think there are a number of issues wrapped up there, ones which you rightly indicate I would not be in a position to make a statement on, namely the financial settlement with the Treasury. However, I think also it is fair to say that we still have to resolve the issue of a number of projects which have run substantially over budget, of which one is obviously the West Coast Mainline, and discussions are still taking place between the various parties to scope that problem and then obviously to make decisions arising from it. Now, we then have to look further down the line at other projects, but while we are dealing with the major projects, of course a number of smaller projects, smaller enhancements, Rail Partnership projects are also going ahead, and of course work has been going ahead both at Manchester Piccadilly and, for example, at Leeds where I was yesterday where there has been a very significant enhancement both to the station, but also, therefore, of course to the availability and capacity at Leeds as well.

  23. You mentioned the West Coast Mainline. Who actually is financially accountable if Network Rail gets it wrong, its sums? When you have a private company, it is the shareholders who take the hit and when you have a public company, it is the taxpayer who takes the hit. Network Rail is effectively neither, so if it overestimates or underestimates the cost of the West Coast Mainline and ends up with a bill that is vastly in excess of what is expected, who picks up the tab?
  24. (Mr Spellar) Well, I do not know that it was always the case that when it was a private company they picked up the tab because they kept coming back to us asking for more money and that was the underlying problem that Railtrack faced and which finally led to them having to be put into administration. Of course the operations of Network Rail, indeed the operations of any infrastructure company on the railway are dependent on the monies that the Government makes available in order to fund the system, and that is the basis on which of course they can borrow in order to run their operation. Therefore, the Government has a very keen interest in ensuring that they are rather robust figures for a scheme and indeed that is the work that is currently being undertaken on behalf of Railtrack, but also obviously of the other parties involved by Bechtel.

  25. But the Government ultimately, therefore, is going to be liable for any financial errors which take place at Network Rail in costing major projects.
  26. (Mr Spellar) Well, it is then the case that you have to evaluate how far you proceed with that scheme, which is precisely why an evaluation of West Cost Mainline is being undertaken at the moment, and the same reason why very careful work is being done on East Coast Mainline, because it was quite clear before Railtrack had to go into administration, even more clear since, that they had lost control of the costs of that project and indeed did not even understand the costs that they were incurring and there was a systemic failure within the management system of that company.

  27. Are you confident that that failure has now been removed? I ask the question because there are increasing reports coming out of the industry that it is running even more out of control than a year ago.
  28. (Mr Spellar) I do not think that. I think that in fact, which I think you might be alluding to, it is becoming clearer, the underlying costs to which Railtrack were committing without actually having clear view as to how that would finally resolve itself in terms of numbers. We do have a greater degree of confidence that there is a better understanding, but also, I think, an understanding of some of the underlying problems which I was alluding to earlier regarding the extra costs that Railtrack are paying over and above that which would be experienced outside in the commercial contracting sector.

  29. Is it, therefore, true that the estimates of the final cost of the West Coast Mainline modernisation, which I think when we met last November was estimated to be running at about 6.8 billion, there is now widespread coverage which suggests that the costs are now sailing on towards 10 billion? Should we be concerned that the price is now soaring well above the 6.8 billion which we discussed last year?
  30. (Mr Spellar) I think we can be fairly clear that it is going to be greater than that, but we are finalising the balance to be struck between the various parties and looking at the feasibility of alternatives.

  31. Lastly, on the East Coast Mainline which comes in with a number of projects in the remainder of the Ten-Year Plan dependent on the special-purpose vehicles, where do we stand with special-purpose vehicles, first of all, in establishing them and, secondly, in establishing a mechanism for contracts and then an eventual transfer of those projects to Network Rail and, thirdly, for the financing vehicles to be put in place for Network Rail to be able to take them over later in the Ten-Year Plan period?
  32. (Mr Spellar) At the moment the SRA are driving forward this programme for the prospect of an infrastructure upgrade and they are working closely with Railtrack and they will be taking it forward as a special-purpose vehicle. Indeed we announced in April of last year that it would be taken forward as a joint venture with the SRA in the lead and potentially involving train operators, project managers and financiers, but it is still, I think, a little too early for us to make an announcement on the final shape of the proposals for the upgrade, but you are right, that this is obviously a project that commends itself to a special-purpose vehicle.

    Mr Stevenson

  33. Minister, it has been reported that Bechtel have produced a draft report which indicates that the cost of the West Coast Mainline is now reaching 10 billion. Have you seen that draft report?
  34. (Mr Spellar) I have not seen that report yet, although I have seen reports of that report.

  35. Is such a draft report in existence, although you have not seen it yet?
  36. (Mr Spellar) I know that Bechtel have been working very intensively on this and they are in discussions with obviously the main actors in this, but I have not as yet seen the report.

  37. Have you any knowledge at all, Minister, of when you may see that report?
  38. (Mr Spellar) I do not think I as yet have a date for that, but obviously we are hoping to get a report as soon as possible so that we can then get a clearer view of the options for the way ahead and the various trade-offs to be struck on that.

    Chris Grayling

  39. You might not have seen it, but have you been told what is in it?
  40. (Mr Spellar) As I have said, I have seen reports of it.

    Chairman: Yes, you did answer that.

    Mr Stevenson

  41. These reports about the report also indicate two other things, that Bechtel cannot work out how much the changed specification of the West Coast Mainline and the modernisation may cost because of this distinction between renewals and enhancements. They are not able to do that. Is that your understanding of the situation?
  42. (Mr Spellar) I have not seen that report yet, but, as I said, we are waiting to get the report from Bechtel, plus the discussions which have taken place between the actors principally involved.

  43. The options which are being considered that you refer to, do they include an option of reduced performance and reduced capacity on the West Coast Mainline?
  44. (Mr Spellar) Well, I think one key area which has already been discussed is not to proceed through to 140 miles per hour and looking at the gain in journey time or the cut in journey time as a result of that against the cost of such a project. Now, that does have a knock-on effect potentially on the number of train-sets required particularly on the main route operated by Virgin and obviously discussions are taking place between the SRA and Virgin on that.

  45. In the light of that situation, what do you make of the reported comments of Mr Graham (?), the Executive Director (Rail) with Stagecoach Holdings who of course own 49 per cent of rail at Virgin Trains, who said in the original report, "The original Virgin business plan is now in complete tatters. The emerging railways that we can see will operate at 125 miles per hour rather than 140. There will be little or no opportunity to compete head-on with airlines and the train plan that was envisaged of franchising has had to be completely redesigned". Pretty strong stuff.
  46. (Mr Spellar) It certainly was not what the boss of Virgin, Sir Richard Branson, was saying the other day when he was standing alongside Brian Souter of Stagecoach where he was being very positive about developments, but also the much better working relationship that he has with Railtrack and with the Strategic Rail Authority under their new management, and was being very upbeat about the prospects of success for the new Pendolino trains.

  47. Finally, clearly the uncertainty about the upgrade, modernisation, renewal, whatever it may be, of the West Coast Mainline is in no one's interests and given the timescale that already this project has taken, are you in any position at all, Minister, to advise the Committee when you anticipate that some definitive plan will emerge that actually will be implemented for the West Coast Mainline?
  48. (Mr Spellar) Well, the SRA are hoping to publish their proposed West Coast Strategy in the next month or so, but they are in pretty intensive negotiations with the main companies and organisations involved in this and there are a whole number of interests, and indeed in some cases not necessarily with compatible interests which have to deal with the outcome of this very unsatisfactory affair, namely the failure of previous Railtrack in any way to manage, budget for or price the West Coast Mainline.

    Mrs Ellman

  49. The Ten-Year Plan says that it will boost the economic competitiveness of all regions, yet the SRA have confirmed to us today that they do not take regional economic strategies or regional transport plans into account in making their decisions. What are you going to do about that?
  50. (Mr Spellar) There are a number of aspects of the Ten-Year Plan and targets and aspirations in that, including the increase of 50 per cent in passenger traffic and also 80 per cent in rail freight.

  51. I am asking you a direct question about the regions. Now, the SRA say that they are not looking at that.
  52. (Mr Spellar) Well, I am actually answering it because particularly if we are talking about rail freight and the 80 per cent increase figure for rail freight, that is very much tied in with the operations across the regions and particularly in trying to enhance rail freight capacity within the regions of the country, particularly those main manufacturing regions, and obviously an enhancement of that rail capacity is a significant part of economic regeneration in those areas.

  53. Are you satisfied then? The SRA tell us that they do not take this into account, you have given me an answer to do with freight, but we are concerned about passenger transport as well, so are you telling us that you are satisfied that the SRA are saying that they are not taking the regions into account in making their decisions?
  54. (Mr Spellar) But they are taking into account ----

  55. They said they were not.
  56. (Mr Spellar) No, they are taking into account the need to increase again the percentage of those travelling by rail and the regeneration then of many major city centres in the regions of the country. They are directing themselves to enhancing services, for example, the improvement in the Crossrail service in Birmingham, the enhancement of capacity at Leeds, which is precisely to improve the access of Leeds to London, but also dealing with suburban rail services and also the enhancements of Piccadilly. All of these are looking at the changing employment patterns in the regions of the country and actually providing capacity in order to be able to enhance that. Equally, the proposals for the Trans-Pennine Express are for that franchise looking at achieving a faster and, therefore, also a higher-volume service which will enable transport between the main towns of the north precisely in order to be able to enhance the regional competitiveness of the regions.

  57. The SRA told us today that they do not assess the impact of their decisions on the north. They make a statement that said they did not do any work to substantiate that. Are you aware of that?
  58. (Mr Spellar) Well, they will obviously be looking at the work that they undertake with the rail operators in order to be able to make a comparison between different bidders for the franchises in order to be able to make an assessment. Of course Ministers also look at that as well and are very much aware of the need for regeneration of the regions of the country.

  59. Are you saying then that you are satisfied that SRA's plans as presently constituted will deliver regional improvements as put forward in regional economic strategies?
  60. (Mr Spellar) I certainly think that and of course I am always willing to entertain representations where people may indicate to the contrary, taking into account of course that we are talking about the mobility of passengers and there are a number of mechanisms for achieving that in all cities. In some cases light rail may be more appropriate and I think my recollection is that the SRA's estimate is that the Manchester Metrolink is carrying more passengers than the other suburban lines put together in Manchester, which may be an indication that there is a package that actually works more effectively within that environment and also in a number of areas bus priority systems may also meet the need. So from the point of view of the Department, it is looking at transport requirement and transport need in areas, not necessarily just meeting it by one mechanism.

  61. Are you going to support light rail in Merseyside?
  62. (Mr Spellar) Light rail in Merseyside, there is an application in for that and that is being evaluated at the moment by the Department along with the officials from Mersey Travel.

  63. Are you going to propose any changes in regulated and non-regulated fare agreements?
  64. (Mr Spellar) In which, sorry?

  65. Fare agreements, regulated and non-regulated.
  66. (Mr Spellar) In which area?

  67. Passenger fares. I think it is the case that for some fares going from Liverpool to London, they have been increased to around nearly 80 per cent over the last four years. Do you feel that is satisfactory?
  68. (Mr Spellar) I think that there is a real difficulty here because one of the successes of the privatisation of passenger rail has been a more market-orientated focus of the rail system, and actually looking at the capacity that rail is carrying and attempting to fill a greater percentage of that capacity, which is more analogous to the way in which the airlines operate rather than the more rigid formula that we had previously.


  69. So you go along with this idea that we should no longer turn up and go, but it should be a service much more closely aligned to the way the airline industry operates?
  70. (Mr Spellar) What I feel is that there are advantages and disadvantages to both schemes.

  71. I think we are aware of that, Minister. We are asking you for your opinion.
  72. (Mr Spellar) Well, one of the driving forces behind the increase in the number of passengers using rail has been the more effective marketing of the new companies compared with the old British Rail, and I do not think that that is really deniable. There is on the other side the high premiums charged for services which are over-subscribed and, therefore, that market mechanism operating, and I know that that causes concerns particularly for business in a number of areas as to whether that is actually achieving the best balance. It does also of course lead to estimates of comparisons between fares in the UK and rail fares in other European countries which do not necessarily capture the full range of fares which are available in the UK. I do not think we should underestimate the impact that the much cheaper fares have had in enabling mobility of people across the country.

    Mrs Ellman

  73. Are you satisfied that Virgin arbitrarily redefined what constituted off-peak hours with the effect that anybody going from Liverpool to London cannot get there before the afternoon unless they pay the 80 per cent increase? Do you think that is reasonable?
  74. (Mr Spellar) I think that there certainly is a perception that some of the increases have been excessive and indeed may have worked against certain parts of the country and I think these are matters that need to be taken up, particularly through the regional rail passenger councils, with the particularly companies in order to make that argument at first instance.

  75. But if the regional rail passenger councils are not listened to or their comments not acted upon, do you feel, as the Minister, that you should have responsibility?
  76. (Mr Spellar) I did say at first instance. If the answer is unsatisfactory, then obviously Members may well wish to raise that with Ministers.

  77. So you, as the Minister, think that that is part of your responsibility?
  78. (Mr Spellar) I think we do have to convey, as Members of Parliament do and we have to work on that, the mood of the travelling public and whether they think they are getting a fair deal, but I do put it into context where we have to take into account the very considerable increase in traffic that there has been, some of which has been driven obviously by the general economic situation, but some has been driven by the better marketing of the new companies.

    Mr O'Brien

  79. I was going to draw attention to the fact that when the Ten-Year Plan was announced, it was welcomed by the Yorkshire and Humber Development Agency because of the fact that it was going to give a boost to the economy. What is required, Minister, is a link between the east and west ports. You did say that we have got good connections between the north and south, and what we need now is east to west, but we are told that the regional transport strategies set out a programme that there will be no financing until after 2010 with no date set. Can you give us some idea as to what action will you take to boost that east to west link through the Yorkshire and Humber area?
  80. (Mr Spellar) I think initially what we are looking at are the schemes that we have, and we are particularly talking about the problems with West Coast Mainline, and other significant priorities. Because of the history of under-investment for several decades in the rail system, there are a whole number of existing problems and, therefore, it is a case, firstly, of looking at the pressing issues of the schemes that are already in progress and also where they are costing more money and also then looking at the priorities for further other schemes. I will ask Mark Coulshed to say something on the ports access, and I am presuming this is the Humberside ports access.

    Mr O'Brien: Well, what happened is that we have transport between the Humber ports and the west coast ports along the M62 corridor and this is over-congested and, therefore, we need to take traffic off the road and the best place is the rail, but we have no direct east-west link. Part of the programme was to develop the east-west link to enhance the competitiveness within the Yorkshire and Humber region with other regions. We are now told that this is not going to be available until whenever and not before 2010.


  81. This really arises because of the multi-modal stuff you were talking about before. It is still recommended that it should be significant, but it is still clear that it will not come before 2010.
  82. (Mr Spellar) Well, some is on some of the east coast ports because we are undertaking work for the East Anglian ports and improving the availability up through Nuneaton. I will ask Mark Coulshed to say something about the Humber ports.

    (Mr Coulshed) There is money set aside in the SRA Strategic Plan for freight enhancements, nothing specifically in relation to Humber ports and I am afraid I do not know what has been said to Mr O'Brien, and he may have better information than I do. One of the things that the SRA will be doing of course is over the second half of this year looking again at the Strategic Plan, and they are under a duty to produce an update of the Strategic Plan in January next year and they will have that opportunity to pick up representations which have been made here and elsewhere about precisely the questions of priorities within the funds which are available, so I dare say they may have more to say about the Humber ports and possibly about other matters to be raised.

    Mr O'Brien

  83. The point the Minister made about the announcement of the East Anglian ports, I welcome that, but if there are going to be specific links between the East Anglian ports and into the Midlands and we do not get anything in the Yorkshire and Humber area, then it is unfair competition between the regions, and I hope the SRA will take note of that because we have had no encouragement from them today or any other time on that particular matter. Now, we hope that the Minister will take this seriously and impress upon the SRA the need for this link from the east coast to the west coast and back as a significant factor of regional development.
  84. (Mr Spellar) Can I undertake to write to the Committee?

    Chairman: It would be helpful and if you would also deal with the multi-modal point because that was something you raised yourself and we would like to know what your view is.

    Miss McIntosh

  85. Minister, in addition to boosting the economic development of all regions, the Ten-Year Plan says that it wants to sharpen the competitiveness of British industry. Now, are you aware, Minister, of the damage that is being caused to local companies, like Potters of Melbourne, with the closure of freight trains from the Channel Tunnel? Your former boss told this Committee that there should be 72 trains a day and that was the figure for April. Are you aware of the damage it is causing locally and the fact that freight is now travelling by road which is intended to travel by rail?
  86. (Mr Spellar) Very much so both from a number of those individual companies, from Members of Parliament's representations, also meetings that I have had with the industry collectively, and also discussions that I have had with EWS. As the Committee will be aware, both myself, the previous and the current Secretary of State as well as the Foreign Secretary, the Home Secretary and the Prime Minister have all been pressing very hard with the French Government in order to get improvements. I met the French Transport Minister at the recent Transport Council in Luxembourg and I hope Members will be pleased that there is now an acceleration of the construction programme of a much more robust fence than the one which was previously built and indeed I am shortly due to meet the head of SNCF to explore that further and to see what ----


  87. Is that fence going to be guarded adequately?
  88. (Mr Spellar) I was going to come on, Chairman, to the second part of that equation which is a much stronger commitment from the new Interior Minister to providing an adequate police presence in that ----

  89. Is he paying for it himself?
  90. (Mr Spellar) Is he paying for which?

  91. The extra police.
  92. (Mr Spellar) The extra police are the responsibility of the French Government and we are making or the Strategic Rail Authority is making a contribution towards the fence.

  93. And if it is 5 million, where is that 5 million coming from - out of that budget?
  94. (Mr Spellar) Indeed because it is extremely important, for all the reasons that have been identified by Miss McIntosh, very important that we actually get stability and then get the increased provision of train services, not just because of the immediate impact, but of course a number of companies, if they move from rail back to road, they then have to sign medium to long-term contracts with the hauliers, so, therefore, it is not a case of when we re-establish the service that there is an immediate return to rail and that is why it is imperative that we improve the situation as soon as possible. I am pleased, however, that for the first time in answering on this I think that there is actually a considerable amount of real improvement taking place actually on the ground and I am getting an indication of the greater degree of confidence now from the industry than I have previously.

    Miss McIntosh

  95. Do you think it is right that projects that might otherwise have benefited from this SRA budget will probably not now benefit because you are using SRA funds to strengthen the fence in France with their budget? Do you think that is right and how will you explain it to passengers who have lost out and are there any other French projects which you have in mind for SRA support out of their budget?
  96. (Mr Spellar) Well, I think it is pretty rich, Chairman, when we are actually taking measures to deal with a very serious problem for freight and we are actually, therefore, facilitating and expediting those that we then get criticised for it. We are dealing with a real problem, that is what government does, and trying to solve it and, as I said, it is as bit rich to then be criticised for actually taking action when the Committee and others have all been fairly free with their criticism in the past for not actually achieving results. It has not been easy, but we are now getting progress.

  97. Does the Government still believe in an independent rail regulator?
  98. (Mr Spellar) Yes, indeed and we have recently announced strengthening that role by having a board for the rail regulator.

  99. So press reports that you are abolishing the post of the independent rail regulator and replacing him by a regulatory board are untrue?
  100. (Mr Spellar) Not replacing him by. In fact in regulation generally it is the normal practice to have a regulator and a regulatory board, so it is not a replacement. It is actually coming in line with common regulatory practice.


  101. It is an enhancement. Is that what you are telling us?
  102. (Mr Spellar) I am saying it is bringing it in line and being consistent.

    Chairman: So it is not a renewal, just an enhancement.

    Dr Pugh

  103. Can I take you back to the vexed subject of Virgin's fares. We had Virgin last week and we taxed them on the fact that it is 172 standard return to Manchester and the like. They frankly acknowledged that they were clobbering the business and occasional user in order to provide them with funds in order that they could make the investments they are required to do. Now, there are other ways in which you can raise funds through investment, and I put it to you that that is actually inconsistent with some of the objectives of the Ten-Year Plan because that will deter passengers, particularly occasional users.
  104. (Mr Spellar) Well, they would obviously be looking at a price that they would be charging consistent with loading capacity on their trains. As I said in my earlier answer, it is undeniable that the targeted marketing of the rail companies in looking at using the capacity on their trains has been a significant factor in the increase in passenger usage in this country. There is the other side of that which is the higher premium fares for those who are using the trains at peak times.

  105. You could argue that with fares like that you need good marketing in some respects, could you not, but is there any study done by the Department for Transport of how much people are put off by the fact that the once in a while that they turn up, they will pay a very high price to go into cities?
  106. (Mr Spellar) Well, I do not think the figures indicate that there is a discouraging effect, although I think there might be an argument as to whether there is an equity issue.

    (Mr Coulshed) If I may add something about this, the SRA will shortly be publishing a consultation paper on fares policy. We have been talking to them about the issues which might be raised in it and one particular issue, indeed two or three of the issues that have been mentioned this afternoon are certainly covered, in particular this difficult trade-off between financing investment and keeping fares down to a reasonable level, and also the question raised earlier about whether it is reasonable to allow for the definition of regulated fares to be varied in the way it has been.


  107. Is that an important part of the note we are going to get soon?
  108. (Mr Coulshed) Yes, I understand the SRA are hoping to publish this document in the next two or three weeks.

  109. Does it include rail freight as well?
  110. (Mr Coulshed) I do not think I want to talk about all the things which might be in this draft. I know of things they have talked to us about.

    Chairman: We just have this old-fashioned idea that you ought to know what is in it and also tell us.

    Dr Pugh

  111. Last week we also had the Passenger Transport Executive and they mentioned a number of different proposals they had in mind for network linking, small network extensions, even re-opening bits of networks. They have got projects in mind and most of these projects currently do not sit in the Ten-Year Plan and are not fundable within their PTE budget. Should they forget about them as totally pie in the sky or is there a way of progressing them and, if so, what? I am thinking about the Wigan Hub, the Burskoe Curves(?), things which have been around for years.
  112. (Mr Spellar) Well, the Wigan Hub is not just a rail plan, but it is tied in with a road plan as well. It is a mixed development which they have certainly talked to the Department about. At the moment we are looking at and hopefully getting a better picture of the commitments that we already have. We also have the Rail Partnership funding and we are also concerned that we should not be over-concentrating just on big schemes to the detriment of a considerable number of smaller schemes which may deliver a very substantial enhancement to the network.

  113. So although you are not against small schemes, you are not encouraging these schemes to be too optimistic?
  114. (Mr Spellar) No, it is not just that we are not against small schemes, but we actually believe that the previous focus maybe of the Strategic Rail Authority largely towards large schemes, there may need to be a degree of correction because a considerable number of smaller schemes may deliver quite substantial enhancement to the network.

    Andrew Bennett

  115. Stephenson's Rocket, when it was first introduced, managed to do over 30 miles per hour. In fact it would find itself at home, would it not, on most of the routes between major cities in the north of England as 30 miles per hour seems to be about the speed of the trains on those routes? When will we actually get the very efficient, up-to-date, fast service between any of the major cities in the north of England?
  116. (Mr Spellar) That is very much the focus of the franchise for the Trans-Pennine Express in order to look at the enhancement of faster trains between those centres and also to grow that market and separating that out, therefore, from the more local trains and getting that different focus for those two franchises.

  117. Can you give us, for instance, two cities which would be benefiting from that within the next three years?
  118. (Mr Spellar) I would obviously have to look at the proposals --


  119. You would like to give us a note on that?
  120. (Mr Spellar) -- that are going to be coming out of the franchise bids.

    Andrew Bennett

  121. What about the engineering works and this idea we are going to have the West Coast Main Line closed for 18 consecutive weekends. Great idea?
  122. (Mr Spellar) There was an initial proposal from Railtrack which was just to close for a block period - three to four weeks is my recollection but we can correct that if I am wrong. There was considerable resistance from the business community in the north west to seeing that shut off for that period. There is a lot of work being done in order to minimise the inconvenience to passengers over those weekends and quite a bit of money being spent, but it is a straightforward trade-off. The engineers, quite frankly, would nearly always prefer to have a solid block of time because of the time it takes to secure the network before they move workers on to it; then, of course, the time when you are dismantling those provisions as well. It really is a case where there needs to be a decision; it is not an easy one and I think there are arguments on both sides, but I think there would have been considerable opposition had there been the closure for that period of time. It is the difficulty with retrofitting an existing system.

  123. When the line was last upgraded, forty or thirty years ago, there were four tracks and two were done and then the other two. Why can that not happen now?
  124. (Mr Spellar) One reason is I think we operate under more stringent health and safety procedures now.

  125. Have the health and safety absolutely vetoed that as a solution?
  126. (Mr Spellar) I think that the procedures under which you have to work, particularly the closeness of the tracks here and the ability to be working while train systems are still running, makes that extremely difficult.

  127. It has been done on quite a lot of the other parts of the track, though?
  128. (Mr Spellar) That is what my advice is, and I am sure that those train companies who are being affected by this would have been pressing for this very strongly if they had not been convinced of the argument that closure, either over weekends or for a block period, was required. After all, this is the sort of difficulty we face on motorways as well, in terms of how we do repairs.

  129. The Highways Agency seems to be getting more and more efficient at dealing with these whereas Railtrack, whatever you call it, seems to be getting less and less?
  130. (Mr Spellar) The Highways Agency is doing that and you are now drawing attention to some of the underlying problems, as I said, with Railtrack. Notwithstanding that there is still a requirement for closure either at weekends or on a completed block.

  131. Can I take you on to industrial relations and driver shortages. What are you doing about it to make sure it does not happen again?
  132. (Mr Spellar) The rail companies are, in fact, working with the SRA doing a considerable amount on that; in pretty well all of the franchises there are a lot of drivers in training, there has been an extensive recruitment campaign, and driver shortages are certainly reducing as reasons for delays.

  133. What about a no-poaching agreement between each of the franchises?
  134. (Mr Spellar) That might be regarded as a restraint on the ability of the drivers themselves to move between one company and another, but quite apart from that the key issue is to ensure that we have sufficient train drivers and that all franchisees are making sure they are training enough drivers to meet their requirements, and a number of them had not. In some cases indeed, after privatisation, some had as I recall laid off train drivers.


  135. The HSE looked at the standards of driver training and gave each one of the companies it looked at a list of things that needed to be done. Are you satisfied, firstly because there is a national agreement on pay and conditions and, secondly, because all the individual TOCs are doing their own training, that there is in fact any kind of standardisation or uniformity across the country?
  136. (Mr Spellar) Standardisation and uniformity of what?

  137. Of the training of drivers, for a start. It would be nice if they all knew how to drive a train.
  138. (Mr Spellar) I am not aware --

  139. You did not read the HSE report which said they had looked at a number of companies and they gave strict instructions to the companies as to what was wrong, but they were concerned that there was no consistency across the training?
  140. (Mr Spellar) But after the HSE have put in improvements then we will be seeing, even if it is not consistency because they are dealing with different groups, adequate training of drivers so they meet the standards. That is quite different, of course, from the question of national rates and conditions and standardised rates and conditions, which is a quite separate issue.

    Andrew Bennett

  141. Lastly, could you not bang the drum to make the rail companies give passengers accurate information? I travelled down from Manchester - ironically for a conference on speed - and it took me six hours. During that journey, I was given misinformation on several occasions, and no accurate information. Could you not get the rail companies to tell passengers what is happening when there are problems?
  142. (Mr Spellar) I very much take that on board and it is quite interesting that, if one looks at public perceptions of different rail companies and then you compare with the objective reliability, very often the public's perception of some companies is much better and one of the key factors may be that those companies give much better information so that even if people are delayed they have a better view.

    Andrew Bennett: What are you doing about it?


  143. So you are going to insist in the future that not only the individual companies but also this Committee get no misinformation but very accurate information, very full and always at the time that they want it, is that right?

(Mr Spellar) Of course, that is an aspiration in both regards!

Chairman: Thank you very much.