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Mr. Graham Stringer (Manchester, Blackley) (Lab): I rise to speak to amendment No. 30 to clause 39—the so called bustitution clause of the Bill. I also tabled amendment No. 29, which was not selected by Mr. Speaker.

I want to explore the scope and practical impact of clause 39. Where a train service is reduced or removed in a passenger transport authority area, clause 39 provides that that train service will be replaced by a bus service, so that the people who previously used the train have a bus service. It goes further than that, however, by allowing passenger transport authorities and passenger transport executives to impose a quality contract on bus operators in the area, which effectively means the regulation of those buses—even if train services are not being removed, it is good to re-regulate buses in metropolitan areas.
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My questions concern the practicality and limits of clause 39. To explore those questions, one must realise that transport in metropolitan areas is not run by benign bus companies that deliver services efficiently, effectively and economically. In my part of Greater Manchester, the service is dominated by First group, which has an appalling record on punctuality and bus maintenance. In a recent inspection, the wheels were found to be falling off three of the buses, which is not unusual. In Yorkshire, an inspection of 96 vehicles found that more than half of them were not fit to be on the road.

The environment is not benign. I have met representatives from Arriva, First group and other bus companies, who do not like the idea of regulation. One of the reasons why they do not like it is simple: those bus companies make 14 per cent. profit in metropolitan areas outside London and 8 per cent. profit in Greater London, where the system is regulated. The regulated bus system in London works effectively and efficiently, unlike the system in other metropolitan areas in this country. The bus companies do not want to co-operate in providing a comprehensive integrated transport system. They provide services to give them the greatest possible bottom line, and they compete on the road in order to do so—sometimes they compete, but sometimes they form cartels and monopolies in order to make profits.

How does clause 39 overcome the problem of section 124 of the Transport Act 2000, which states how PTAs and PTEs can introduce quality contracts? The Government are reducing the timetable for consultation in section 124 to six months, which is welcome. However, section 124 also states that quality contracts may be introduced when they are the only practical way to provide bus services in an area. That is a high hurdle over which the PTAs and PTEs must jump. My reading of clause 39 is that section 124 of the 2000 Act remains, so that hurdle must still be overcome. Will the Minister explain how quality contracts can be implemented if bus companies are determined to change their services? Under the deregulated system, bus companies often provide services that they withdraw immediately after the consultation period. Clause 39 is defective and will not achieve its objective.

1.45 pm

Clause 39 is also ambiguous. In Committee, we had an interesting debate—I thought that it was interesting, although I do not know whether the Minister agrees—about how far a quality contract can be extended following the de minimis withdrawal of a train service. If one train were removed from one commuter line in south Yorkshire or Greater Manchester, would clause 39 allow the regulation of all buses in south Yorkshire or Greater Manchester? I hope that the Government intended to leave that wonderful loophole to improve the delivery of bus services in metropolitan areas, but I do not think that that was their intention.

The limits of the quality contracts are not clear. In Committee, the Minister gave the helpful reply that quality contracts do not mean a substitute bus running alongside a railway line to the same timetable, and that the replacement service will be integrated into the rest of the system, but he did not provide a clear answer on how far that contract can go. Amendment No. 29 is designed to explore those issues so that we do not implement
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defective legislation that does not allow PTAs to introduce quality contracts when the conditions described in the Bill occur. The matter is important and we must get it right. As I said earlier, a regulated system would have merit without clause 39, but if clause 39 is included, I hope that it will be used to introduce a regulated bus service.

Mr. Elfyn Llwyd (Meirionnydd Nant Conwy) (PC): On new clause 1, although I appreciate that it is helpful to have first class and standard class on most lines, the hon. Member for Christchurch (Mr. Chope) over-egged his pudding. I often travel by first-class rail, but I also often travel standard class from north Wales to south Wales, and I am in reasonable health after doing so. To suggest that travelling by standard class is a health risk is beyond the bounds of credibility.

Amendment No. 52 seeks to introduce a further paragraph in clause 32(4), which concerns references to the Office of Rail Regulation. Railways are an integral part of the economy. They provide not only transport, but social, environmental and economic benefits. I hope that the Government will look favourably on amendment No. 52, which would complement clause 32(4) and round off the criteria for references to the Office of Rail Regulation. As it stands, clause 32(4) merely refers to "consultation" and does not refer either obliquely or plainly to the social, environmental and economic costs and benefits of the proposal being referred to the Office of Rail Regulation. I hope that the Minister can respond to that amendment, and possibly even accept it—I live in hope.

Amendment No. 53 is a probing amendment, which states:

If the Minister is prepared to tell me whether that is the case, the amendment will have been worth while. I hope that he can respond one way or t'other.

I will be brief because I know that Members wish to speak to other important amendments. I look forward to the Minister's response.

John McDonnell: I tabled amendment No. 5 simply to allow me to express concerns in the rail industry and elsewhere about the process of—I hate the word—bustitution. The post-Beeching experience shows us that where such substitution bus services were introduced they often did not survive for long. We therefore need to take great care as regards any legislation that enables passenger transport authorities to undertake them.

Members on both sides of the House support the concept of quality controls with regard to bus quality contracts. London's regulated bus service has proved a success. However, it is strange that the Bill introduces bus quality contracts solely in relation to rail substitution services. What will the Government do to ensure that bus regulation is promoted throughout the country using bus quality contracts? It is unusual and bizarre to link that solely to the removal of railway services. I am concerned that if we allow the clause to go forward without further refinement, bus substitution
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services that are provided after rail service cuts will ultimately be cut once again, as they were after the Beeching regime.

Mr. Mark Field (Cities of London and Westminster) (Con): I fear that it falls to Conservative Members to defend the interests of first-class rail passengers. Nevertheless, my hon. Friend the Member for Christchurch (Mr. Chope) made some serious points. If high-quality passenger accommodation is available on all our trains, more people will use public transport, including those who might have been dissuaded from doing so in the past. In Heathrow, for example, taxi traffic may have been reduced as a result of the Heathrow Express. That would have more effect in the constituency of the hon. Member for Hayes and Harlington (John McDonnell) than in other parts of London. Does the Minister have any evidence that high-quality new services such as the Heathrow Express and Gatwick Express, with first-class accommodation, make a contribution to getting traffic off the roads? If not, will he conduct such a survey?

The amendment tabled by the hon. Member for Manchester, Blackley (Mr. Stringer) is sensible, but it shows a certain of degree of wishful thinking on his part about what goes on in London. While I would not want to gainsay anything said by the hon. Member for Hayes and Harlington, there are problems with the highly-regulated bus transport market in a broader sense, as well as in relation to bustitution. A significant amount of work is taking place on the tube and rail networks in the capital, often at weekends. There are very effective bustitution arrangements to deal with that, and I must give credit to Transport for London for doing a good job in that regard. As I live and work in central London, I use the buses regularly. I would be the first to say that there have been improvements to that service over the past four years under Mayor Livingstone. However, I am afraid that they have come at a great cost, which I suspect that he rather hoped would be underwritten by the Treasury. That has not happened, with the result that TFL faces losses of up to £1 billion a year from its budget for 2007–08.

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