Previous SectionIndexHome Page

Grant Shapps (Welwyn Hatfield) (Con): I am the Member of Parliament for Hatfield. I was in Hatfield on the day of the crash and have followed the goings-on
24 Oct 2005 : Column 69
with great interest as a result of the immediacy of the case to me. I pass the memorial at Hatfield almost every day and am familiar with the issues of the cracked corner rail, which led to that tragedy and the four deaths.

This, however, is not a debate about Railtrack and whether it was a good or bad company. This is a debate about the way in which Railtrack was renationalised on the cheap. That is the only subject of the debate, and all the contributions that we have heard this afternoon from the Government Benches about how it was something to do with the success or otherwise of Railtrack are red herrings. They are irrelevant to the case. I have been in business for the past 15 years. It is a company limited by guarantee, so there are shareholders. The idea that a Government can take away those shares without due process and, in this case, without reference in advance to Parliament, is appalling. That is exactly what happened.

Mr. Byers: The hon. Gentleman stated that the Government took away the shares of those who held shares in Railtrack. To ensure that he is not misleading the House, will he reconsider what he said? He will know that Railtrack shareholders got £2.50, I think, or £2.60 each, so they got the value in the company. The Government did not take away any shares from Railtrack shareholders.

Grant Shapps: Indeed. I am grateful for the right hon. Gentleman's intervention. Earlier, he told us that he thought shareholders got £2.50 or £2.60 when the company went into administration. I can tell him that the shares were at £2.80 when he effectively put Railtrack into administration, and the shareholders were compensated at just £2.50. I am happy to correct that assertion and to cover another point that I wanted to mention about the right hon. Gentleman's contribution.

Make no mistake: this is not an argument about whether we think Railtrack was a good or a bad company. It is not even an argument about whether we think the directors of the company were running the company correctly. There is well established company law to deal with all those matters. If the company was trading insolvently, just as if my company were trading insolvently, there are laws to deal with the directors in such instances. It is not good enough for the Government or the former Secretary of State for Transport, Local Government and the Regions to say that because the company was inefficient, or even if the company was in some way acting incorrectly in a legal sense, the only choice was to force it into administration, yet that is exactly what happened. The critical point is that it happened without reference to the House.

The same argument is used about the independent rail regulator and the idea that he could not have been approached differently. We have heard about the e-mails that were flying about. In one, the Government were concerned that the rail regulator might thwart them, and they considered the Office of the Rail Regulator a "total wild card". In the e-mails of September and October 2001, the Government said that if they could not silence the regulator, and if he stood up to them, the plan to keep the company solvent would be "up the creek". In other words, the right hon. Gentleman feared the rail regulator.
24 Oct 2005 : Column 70

Time is short and it is important that we allow for sufficient summing up on both sides. As we have seen from today's debate, the project code-named operation Ariel was anything but whiter than white.

6.19 pm

Mr. Kenneth Clarke (Rushcliffe) (Con): It gives me great pleasure to make one of my occasional guest appearances at the Dispatch Box.

I have followed the Railtrack case since the evidence in the court case first began to reveal to the public exactly how the whole process came about. One of my key interests in politics during this Government's period in office is the way in which standards in public life have been reduced and the way in which the Government have changed the decision-making process. In the past eight years, most of the proper process has been subverted by the way in which new Labour operates, of which the Railtrack case is a prime example—indeed, it is the best example that we have seen so far, because of all the evidence that has come out.

When the evidence on the Railtrack case came out, it did not get the publicity that it might have received because it followed the tragic London underground bombings. Then we had to wait for the judge to pronounce on whether the then Secretary of State was motivated by personal malice towards the shareholders. Today, the Government are trying to evade responsibility by introducing general arguments about the privatisation of the railways and the competence of Railtrack's directors, whom I will not defend. They are avoiding not only the decision itself, but the very way in which the decision was taken and the processes by which the ultimate insolvency occurred and the situation we face today arose.

This Government took over eight years ago, and they have changed the way in which the Government operate, to the detriment of good decision making and the proprieties of public life, such as openness to the public and accountability to this Parliament. They no longer follow any proper system of Cabinet government, collective responsibility or recorded open decision making. I have been through all the papers and, so far as I can see, no Cabinet paper was ever produced and most Ministers, including most members of the Cabinet, had no idea what was being planned. That is a classic example of informal decision making on the sofa of one Minister or another. The only people who had the first idea what was going on were the Prime Minister, the Secretary of State for Transport and his then colleagues and, crucially, the Chancellor of the Exchequer, who played a key role throughout.

Meetings were unminuted, and many departmental officials did not leave their fingerprints behind. Fortunately, not only were one or two minutes kept, but a series of extremely reckless and unsuitable e-mails went flying between Departments. The former Secretary of State has said that the Department willingly produced some of the information, when the whole ghastly tale began to be revealed.

This Government do not follow any of the normal rules of parliamentary accountability. We have just heard the right hon. Member for North Tyneside (Mr. Byers) discuss his intention to legislate, to which I shall return in a moment. This House was never
24 Oct 2005 : Column 71
informed about any Government plan to legislate to take away the independent regulator's powers. Indeed, when the report of the court proceedings was recently released, it came as a revelation to all hon. Members and to most Ministers.

In my opinion, the best example of the absence of parliamentary accountability is the lack of any appearance by the Chancellor of the Exchequer or even, so far as I have observed, any Treasury Minister. The Opposition motion is extremely critical of the Chancellor of Exchequer, because his special adviser orchestrated the policy and because he was mainly responsible for the way in which the Government planned to restructure Railtrack. I cannot remember a Minister who, having been personally chastised by a motion on the Order Paper, did not bother to stick his nose around the corner of the Chair, and it will be interesting to see whether his name appears in the Division list.

In my opinion—I am sorry to give this news to anyone who has not heard it—the Chancellor of the Exchequer will be the next Prime Minister of this country. Under the present Prime Minister, standards of parliamentary accountability have declined to a quite unacceptable degree, but I fear that the next Prime Minister will make the present one look like a democratic saint. The next Prime Minister is a control freak who disdains any criticism on the Floor of the House of Commons and leaves his colleagues to look after such matters for him.

One of the worst things that has been revealed by this case is the undermining of the independence of the civil service and the misuse of the role of special adviser—a subject on which I have previously made entire speeches. The Government always promise to introduce a civil service Bill to restore the independence of the civil service and to protect the civil service when it is made to do things of which it doubts the wisdom; unfortunately, the legislative programme never includes enough time in which to introduce it.

The special advisers in this case acted in an extraordinary manner. I will not repeat all the allegations against the special adviser to the Chancellor of the Exchequer, but she is obviously a formidable lady and she played a leading role. I pity the unfortunate officials in the then Department for Transport, Local Government and the Regions who had to contend with Jo Moore, who is, by all accounts, a very difficult lady, and who ended the ministerial career of the right hon. Member for North Tyneside for the time being.

The Chancellor's special adviser was also obviously regarded as extremely formidable. When she summoned meetings, all the officials attended, and when she gave guidance on the Treasury's view, it was followed. The right hon. Member for North Tyneside, who at least has the courtesy to smile, must remember the times when he wondered who was in charge of his Department. He had to take instructions from the people who came to see him from the Treasury.

Many of my hon. Friends who are present in the House tonight were formerly special advisers to Conservative Governments. I can see five former special advisers, and two of them were special advisers in the Treasury in my time. All those hon. Members will
24 Oct 2005 : Column 72
confirm that they would have been sacked if they had behaved like that. If my hon. Friend the Member for Buckingham (John Bercow), who was a special adviser in the Treasury, or my hon. Friend the Member for Bury St. Edmunds (Mr. Ruffley), who was also a special adviser, had sent such e-mails to the Department for Transport and had addressed the Secretary of State and his officials in the same way as the current Chancellor's special adviser, they would have been sacked. However, I would have expected any half-decent Secretary of State for Transport to have thrown out the Chancellor's special adviser and sent her back to the Treasury. When the Chancellor wants to issue instructions, he should have the courtesy to call a meeting and issue them himself.

What were those instructions, and what was the Government's motive? The right hon. Member for North Tyneside has attempted to evade the whole point of the debate. He relies heavily on the fact that the court found in his favour, but it did so because the shareholders had to climb the extraordinary mountain of seeking to demonstrate that he was acting out of a sense of personal malice against them, which they failed to do. The court expressly left open the politics of the matter, and I do not think that a court was the right place to determine the proper conduct of government, the parliamentary process and other things.

I have no personal malice against the right hon. Member for North Tyneside, but he cannot escape either on the grounds of the court judgment or on the evidence he cited, where he was just being disingenuous. He says that he was motivated by a concern for the travelling public, but they are not mentioned—there is not even a passing reference—in the e-mails. [Laughter.] Suddenly, he remembered Hatfield and Ladbroke Grove. There is nothing in the papers about punishment being imposed for the undoubted lapses in maintenance standards at Hatfield and Ladbroke Grove. He talked about how much he resented having the legislation, which was not his creation, that gave the regulator his role, and how it was really all the Conservatives' fault that that was there in the first place. He is a Blairite—a pro-privatiser. When the privatisation of the Royal Mail is proposed, if the Government can sort it out, he might even agree with me on that—I have no idea. During all his years in government he never showed the slightest interest in renationalising anything. For four years, his Government were in office and did nothing whatever to change the structure that they had, including the role of the independent regulator.

Let us have none of this. The right hon. Gentleman and Ms Vadera were not driven by a sense of concern for the travelling public or by a sense of outrage at the evils of privatisation or the rail accidents that had occurred. They were interested in two things. The first, which we have not touched on today and is the subject for a much wider debate, is the Chancellor's overriding concern that the new body that was to be set up should be off balance sheet. That is why it failed and every other device failed. The thing that the Chancellor was most
24 Oct 2005 : Column 73
concerned about personally was that it should not appear on the books and that any future debt should be totally off balance sheet.—[Interruption.]

Next Section IndexHome Page