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Mr. Graham Stringer (Manchester, Blackley) (Lab): To reassure the hon. Member for Spelthorne (Mr. Wilshire), I can tell him that the railways were in charge of their own safety for many years before that responsibility was handed over to the Health and Safety Executive. There has been a century of improvement in railway safety, so although the hon. Gentleman made some interesting points, we do not need to worry about them.
Our debate has lacked annoyance, perhaps even anger, at what has happened to our railways in the 11 years since the Railways Act 1993. To try to gain
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some perspective, I looked at the Second Reading of the Bill that set up the Strategic Rail Authority in July 1999. Fascinatingly, in that debate, Opposition Members were completely satisfied with privatisation. I am caricaturing, of course, but the essence of their argument was that nationalisation of the railways had never worked and never would, thus justifying the extremely high costs incurred in selling the railways to Railtrack. Interestingly, in 1999 the railways were valued at six times the price at which they were sold off—the Public Accounts Committee concluded that the railways had been undervalued and sold in haste.
Sir George Young (North-West Hampshire) (Con): Does the hon. Gentleman think that by any chance the attitude that the Labour party took at the time of privatisation had some influence on the price?
Mr. Stringer: The major influence on the price was the deep underlying philosophy of the Conservative party that it had to do something to get the problem off its hands. On the other side of the equation, ROSCOs—rolling stock companies—were sold off in an unregulated way and were sold on almost immediately for a third more.
That was the situation that we faced, but it became a great deal worse. Labour Members were keen that the SRA should provide a sensible direction for the disparate rail industry, which, admittedly, was giving a good financial performance. The hon. Member for Rochford and Southend, East (Sir Teddy Taylor), for example, said on Second Reading of the Railways Bill in 1999 that eventually the railways would be operated without any cost to the public sector. Even though he was right according to his own terms of reference, events proved him wrong.
Railtrack was not a railway company, so it was not controlled. It turned into a rapacious property development company that paid scant regard to the safety of travellers and passengers. "Broken Rails" by Christian Wolmar sets out in great detail the way in which privatisation of the railways and the establishment of Railtrack led to poor railway maintenance. The chief executive of Railtrack got off extremely lightly. Hon. Members may not know that before the accident at Paddington he claimed that the station was the safest in the world. That was mere bravado, and he was not interested in the problems. Subcontractors to Railtrack and smaller groups were operating at a large profit without any direct control, so it was clear that the chief executive had no idea what was going on.
Railtrack has now been replaced by Network Rail, and there is a huge subsidy for the railways. It is difficult to know from the figures what is investment and what is subsidy, but the Government have made two attempts prior to the introduction of the present Railways Bill to put things right. I have already talked about Network Rail—[Interruption.] Opposition Members may laugh, but I do not think that the Government got it right at the time, and I do not wish to defend everything that they did. They acted to provide a sensible direction for a disparate industry, which was beginning to show the cracks.
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It is clear, however, that the overlap between the responsibilities of the SRA and the rail regulator were not properly thought through. In its report on the future of the railways, the Transport Committee said that the rail regulator could effectively overrule the SRA, the Secretary of State for Transport and the Treasury and decide how much money went into the railways. I do not believe that that situation was envisaged by the then Secretary of State in 1999; it was a mistake that led to the spending of a great deal of public money, not all of it on investment.
The Government made another attempt to put things right when they created Network Rail after Railtrack had failed both as a property company and in its fundamental duty of running the railways. Network Rail is an improvement, but it is an odd body, and it is difficult to know whether it is in the public or the private sector. It cannot continue in its present form for long, because there is clearly no direct accountability for the money that is spent, either to shareholders or to the Government. It is run by people with vested interests in the railway system. It may work better than Railtrack did, because those people have the interests of the railways at heart, but it will not work in the medium term.
I am disappointed that the Bill does not provide for an improvement in the structure of Network Rail. I see the Bill as a step forward, and in the right direction, but I do not believe that Network Rail is the right medium or long-term solution for the railways. We do not know how taxpayers' money is being spent in the rail system. Network Rail is a vehicle for keeping £100 billion worth of debt off the public accounts. Everybody knows that, and it does not seem sensible to keep an unsatisfactory structure in place to hide something that everybody has seen. That is not a long-term solution.
On the amount of extra money that has been spent and attempts to disaggregate it, Professor Roderick Smith told the Transport Committee that for between £11 billion and £27 billion—the amount of money wasted in the rail system is probably within that range of expenditure—we could have had a new rail system. That is the extraordinary sum that has been wasted.
I support the Bill, and I will vote for it on Second Reading, because it addresses some of the problems in the rail system. Primarily it addresses the need for public accountability for money. The hon. Member for South Suffolk (Mr. Yeo) did not tell us how the large amounts of public money that have been put into the rail system should be accounted for. I believe that there should be accountability for taxpayers' money, and the Bill makes the Secretary of State accountable. That does not mean that the Secretary of State will control the entire railway system. Many of those responsibilities will remain within the rail regulatory system and within Network Rail, but the Secretary of State will take responsibility for the public money and some of the major strategies involved.
There are three aspects of the Bill, to which I shall speak briefly. I mentioned the first in response to the contribution from the hon. Member for Spelthorne—the removal of responsibility for health and safety in the rail system from the Health and Safety Executive. I fully support that decision. It is clearly a brave decision for a Secretary of State to take, because if there is an accident—and there can be an accident in any system—
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people will tend to point the finger at him. That would be the wrong conclusion to come to. It is clear from the evidence to the Select Committee of Mr. Osborne, who for a period was in charge of safety at the HSE, occupying the position recommended by the Cullen inquiry, that the rail industry had lost confidence in the HSE to pursue safety in the rail industry.
The Select Committee also found many cases of gold-plating—public money spent on minor safety improvements. The money would have been much better spent elsewhere within the transport system. Spending £1 billion in one place to achieve very little improvement in safety means that £1 billion less is being spent elsewhere—for example, on the roads, where 3,000 people a year are killed. I am pleased with the change, and I would hate to see it misrepresented. I was a great supporter of the Health and Safety at Work, etc. Act 1974 when it was introduced—
Mr. Greg Knight: The official Opposition broadly agree with the points that the hon. Gentleman is making about the Health and Safety Executive. Subject to hearing what the Minister has to say further in Committee, we think that the decision is broadly the right one.
Mr. Stringer: I am grateful to the right hon. Gentleman. I am not sure that it is always career-enhancing to have Opposition Members agreeing with me, but I thank him for that intervention.
The other two aspects on which I shall comment are, first, rail substitution, and then the right of passenger transport executives to sign franchises. On rail-bus substitution, there is an implication in the Bill of a one-way ratchet. If the PTEs are willing to take the money currently applied to rail lines and put it into bus services, as a reward for transferring that money they will be allowed to regulate those buses. In some cases that might be sensible. In some urban areas there are probably a very few railway lines that do not have a future use. None the less, I ask the Secretary of State why, if a failing railway line triggers bus regulation, bus regulation is not triggered by failing bus services, such as those in north Manchester, and other major cities and metropolitan areas? It does not make sense to say that if a railway fails the PTE can regulate the buses, but if buses fail, there is no competition and the bus companies rip off the public sector with cartels, the PTE cannot undertake regulation.
There is a further point about rail-bus substitution. Regulation and quality contracts will be allowed if the Secretary of State agrees and they are within the terms of the local transport plan. The local transport plans have been given four objectives by Government—to reduce congestion, improve road safety, improve accessibility and reduce pollution. Nobody could disagree with those aims, but having served on a passenger transport authority and on a city council for a long time, I know that those are not the only objectives of public transport systems. They are good objectives, but two related objectives that should be recognised are getting more people into city centres and something that is probably even more important—supporting urban regeneration schemes.
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There are some urban regeneration schemes in Greater Manchester that will not happen if there are only bus services. They need light rail and in some cases heavy rail, or light rail substitution for heavy rail. The Government are too narrow in their objectives for local transport plans if that is the basis on which they allow the substitution of heavy rail for buses. When I asked the Secretary of State about that in the Transport Committee, he said that it was very difficult to measure urban regeneration. Indeed it is.
It is very difficult to measure congestion. The Department for Transport and the Secretary of State have failed for some years to come up with a universally agreed measure of congestion. I ask the Secretary of State a simple question: is Leeds more congested than Manchester? Is Leeds more congested than Birmingham? Is Birmingham more congested than Manchester? If there were a simple measure, there would be a simple answer. The degree of difficulty in measuring something does not mean that it should not be measured. For most councils and most passenger transport authorities, one of their top priorities would be urban regeneration.
The issue of the passenger transport executives' right to sign franchises has been touched on by other speakers. I have said on a number of occasions that I agree with the Government's declared intention to devolve responsibilities to the passenger transport executives, and I listened carefully to what the Secretary of State said in response to a number of interventions on that subject. To summarise, he said that there had been at least one difficulty when a PTE had used a delay in signing to haggle for extra resources. Surely he could take to himself the power to intervene if PTEs unreasonably withheld the signature; I do not seen any problem with that.
It was also suggested that it would be simpler if the Secretary of State took control and effectively devolved responsibility back to the PTEs, allowing them to sign franchises if he agreed. I think that that is a complicating factor, as PTEs and members of PTAs are much more likely to end up spending a lot of time negotiating with Whitehall officials, who will almost inevitably not understand the circumstances in Manchester, Birmingham, Leeds, Newcastle or elsewhere. That arrangement will be more time-consuming than allowing PTEs to do what, with only one exception, they have done successfully and without any problems.
I welcome the fact that the Secretary of State told the Select Committee that on that matter he would consider representations, and what was said in the Standing Committee. He also said today that he would meet a delegation from the House of Commons passenger transport executive group, which has recently been set up. I hope to persuade him in those discussions that the current proposals are centralising ones that conflict with the objectives set out in the White Paper, with which I agree.
I support the Bill as a step forward and a way of ensuring more accountability for public money. It does not go as far as I would like, it leaves some odd structures in the railway industry that are probably not as effective as they could be and will not deliver as well as they should, and there are some detailed parts of it that I look forward to discussing in Committee.
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