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Mr. Darling: I find it curious that the hon. Gentleman started by welcoming the statement, but as he went on and on, he told us more and more why it might be better to go back to the old days of Railtrack and the botched privatisation that his party left us.

In relation to railway costs, over the last few years, especially since the time of Hatfield, it has become glaringly apparent that successive Governments have not invested enough in the railway infrastructure in this country. If I may illustrate that to the House, in the late 1980s and early 1990s, before the previous Government started the privatisation, British Rail used to reckon on having to upgrade or replace about 500 miles of track a year. In the run-up to privatisation, because investment dried up, that renewal figure dropped to about 300 miles a year. After privatisation, it dropped to 200 miles a year. It is therefore not surprising that trains and track operators are now encountering the difficulties of lines that were not maintained properly.

Unfortunately, this country must meet those bills, and must ensure that the railway network operates efficiently. What is equally clear, however, is that we need to do that at a cost that can be justified. I have made it clear on many occasions that the railway industry must cut its costs—that is the central point of the Network Rail decision. The contracts that were set up—not even by Network Rail, as they were imposed by the last Tory Government—provided that maintenance work was to be farmed out to companies on the basis that they decided what to do, when to do it, and that it was done on a cost-plus basis. Those companies could therefore decide what they did and send the bill to Railtrack, as it then was, and it would then have to be met. That is not an efficient way to run the railways. Therefore, in relation to the hon. Gentleman's complaint about getting costs under control, the whole structure that was set up in relation to Railtrack and rail maintenance following privatisation did not work. That is why Network Rail was right to change it.

The hon. Gentleman went on to say that the proposal was an idea that had been planned overnight. Network Rail took over in October last year. For the last few months, it has publicly been looking at the nature of these maintenance contracts. The hon. Gentleman rightly refers to the fact that three contracts were taken back in-house because Network Rail wanted to find out what was going on. It found out that the unit costs of doing work could vary dramatically—by up to 60 per cent., I am told—in similar parts of the country, and that work was not being done in the way that it would expect. In other words, the company—Railtrack—was not being well run. Of course it makes sense to change that.

It is interesting that when the hon. Gentleman was listing all the people for whom he felt sorry, not once did the word "passenger" cross his lips. That speaks volumes about the Tories' attitude to the railway.

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[Hon. Members: "He did."] We all listened to what he said. He seemed more concerned about the fate of Railtrack than about passengers who use the railway.

In relation to the hon. Gentleman's criticisms of the railways, we are replacing more track than has been replaced for many years. For example, the west coast main line is being completely—[Interruption.] It is being redone because it has not been properly maintained since the 1960s. Yes, the Labour party was in power for part of that time, but the Tory Government did nothing about it for 18 years.

The hon. Gentleman had the gall to say that forward railway orders were the lowest they have been for some time. We are replacing nearly 40 per cent. of all rolling stock within a five-year period, which never happened under the Tory Government.

Mr. Collins: Tory orders.

Mr. Darling: Tory orders indeed! The work that is being done on the railways is only possible because this Government have agreed to spend public and private money amounting to £180 billion over ten years. Money is going into the railways and we are confident for the future of the railways. The announcement is designed to ensure that money is spent to give the best possible benefit to passengers and taxpayers generally. The measure will put in place proper management for the railways to replace the mess with which the last Tory Government left us.

Mr. Dennis Skinner (Bolsover): I must say to my right hon. Friend that his statement is very good news. It is the kind of news, which happens every once in a while, that you do not have to spin. It is so self-evident that it is a good idea—so much so that the RMT chief, Bob Crow, is on board, Transport 2000 is acclaiming it and every passenger who was interviewed said that it was great news. My hon. Friend the Member for Crewe and Nantwich (Mrs. Dunwoody) will probably say the same thing. If my right hon. Friend needs any help to accelerate the process, may I tell him that since he stood up, I have gathered 25 signed letters to ask him to keep the momentum going? Well done.

Mr. Darling: I am grateful for my hon. Friend's support, although I shall resist the temptation to say much more in case we fall out. I very much appreciate what he says. I can only assume that the Conservative Benches are so thinly attended because Conservative Members are away writing their own letters.

John Thurso (Caithness, Sutherland and Easter Ross): I thank the Secretary of State for his courtesy in sending me a copy of the statement. It has been patently obvious that the arrangements that were put in place for the maintenance of the railways since privatisation were wholly botched and completely inadequate. Contractorisation has been a failure. I therefore welcome the statement, and Network Rail and the Government's recognition of a need for change. Does the Secretary of State agree that there is no doubt that the recent spate of incidents on both the railway and the tube have not only proved that point but, critically, severely damaged the public's confidence in the rail network?

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Although I welcome the statement and its implications, I have several serious concerns. Given the nature and speed of the decision, can the Secretary of State assure us that the threat of legal action by contractors will not lead to bloated pay-offs to contractors for shoddy work? Does he agree that it is imperative that a culture of safety first be restored to the railways? Given that Network Rail's deputy chief executive conceded that culture change was a serious problem, what can the Secretary of State do to ensure that the change takes place? How will the Government help to restore the public's confidence because we still have the safest railways in Europe and it is vital for that confidence to be restored? The Secretary of State stated that a saving of £300 million will flow from the changes, so will he assure the House that that saving will be spent on tackling the maintenance backlog to which he rightly referred, and not lost on other cost rises? Finally, to paraphrase 1 Corinthians 13, the travelling public deserve a safe, reliable and affordable transport system, but the greatest of these must be safety.

Mr. Darling: No one would doubt that safety is paramount. Safety, and the culture of safety, ought to be in with the bricks. It is not an added extra and should be taken as a given, as it is in the airline industry. I agree with the hon. Gentleman on that.

In relation to the hon. Gentleman's more general points, our overground and underground railways suffer from the same problem of decades of under-investment. Many, although not all, of the problems that we encounter are rooted in the lack of money for the railways, which meant that they were not properly maintained and renewed. I am not making a party political point. Successive Governments have been at fault. No doubt Gladstone was a bit remiss as well. However, the public have every right to have confidence in the railway system. It is a safe form of transport—safer than cars and some other modes of travel. We are renewing and improving it. There are no quick fixes, but it will get better year on year provided that we keep up the investment and, crucially, provided that the industry gets a grip of costs. Costs got out of control under Railtrack. They need to be got back under control so that for every £1 we spend we get a £1-worth of benefit.

On confidence, it is worth reflecting on the fact that Britain's railways carry more people today than at any time since 1947, despite a tenfold increase in car ownership. So the railways can be popular. People expect the Government to ensure that the system is in place to deliver better railways.

On two minor points, first, it is for Network Rail to sort out legal action with its contractors. Secondly, on savings, the hon. Gentleman will have seen that Network Rail has produced a range of proposals, all designed to reduce significantly the costs of maintaining the railway. People do not begrudge the money going to the railway system, but they want to ensure that it is properly spent.

Mrs. Gwyneth Dunwoody (Crewe and Nantwich): The Secretary of State will realise that passengers and the general public will be highly delighted by this announcement. It is long overdue. People have found it difficult to understand why the enormous sums of money that the Government committed were wasted by

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being poured into contracts that were demonstrably not doing the job. Will my right hon. Friend confirm that the new organisation, Network Rail, will not only maintain high standards, but be used as a benchmark for other parts of the railway industry where it is clear that contractors have been taking on the taxpayer in the most outrageous way and need to be curbed?

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