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The Parliamentary Under-Secretary of State for Transport (Derek Twigg): I congratulate the hon. Member for Sutton Coldfield (Mr. Mitchell) on securing the debate. It is clear from his remarks that this is a matter of ongoing concern in his constituency. I thank him for the information that he provided before the debate, which has been helpful in preparing the response to the important matter that he has raised.

Before dealing with the specific issue, I would like to say a few general words about Network Rail and its structure, objectives, responsibilities and priorities. Network Rail is a very large organisation and has a diverse and extensive portfolio of land and property. It employs more than 30,000 staff and owns and maintains 21,000 miles of track. Network Rail's priorities must be focused on the effective management of the rail network. Its first priority is to operate a safe, reliable and affordable railway.

The hon. Gentleman is concerned that Network Rail is not accountable to Ministers and that it is unclear to whom it is accountable. In truth, Network Rail has a large number of stakeholders, and I will say more about that shortly.

The concerns in Sutton Coldfield arise from the installation of new line-side fencing. The main reason for that is to improve safety and to prevent trespass on the railway. The primary responsibility for preventing trespass on the national rail network lies with Network Rail. In doing that, Network Rail works closely with the British Transport police, the Department for Transport and others in the rail industry and the wider community.

Network Rail's national fencing programme is designed to reduce the scope for unlawful access to the rail network, and is recognised as a good initiative. I note that neither the hon. Gentleman nor his constituents dispute the need for fencing along East View road.

The hon. Gentleman raises concerns about Network Rail's lack of accountability to local planning authorities, in particular with regard to planning policies about the colour of fencing. As a statutory undertaker, Network Rail enjoys permitted development rights, under part 17 of the Town and Country Planning (General Permitted Development) Order 1995, for development on its operational land required in connection with the movement of traffic by rail. Statutory undertakers have acquired such rights for very good reasons. They provide an essential service to the public. It would therefore be unreasonable and inefficient to require them to make a planning application for essential development each time they needed to build something on their operational land.

The Office of the Deputy Prime Minister is carrying out a review of the permitted development order arising from its 2002 Green Paper outlining proposals for fundamental reform of the planning system. The review included a research study of the permitted development rights available to railway undertakers. Following publication of the study in September 2003, ODPM will undertake a public consultation before implementing any proposed changes to current rights.
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I would like to go into more detail about Network Rail's status and responsibilities. Network Rail is a private sector company operating on a commercial basis. It is a "company limited by guarantee". It has no shareholders and so does not have to earn dividends to pay them. Instead, any surplus it makes can be reinvested in the rail network for the benefit of all.

I think that at this point it would be worth explaining the new railway structure following the Railways Act 2005. The changes are vital to drive up standards, improve overall performance and underline who is best placed to deliver. The Government have taken charge of setting the strategic direction of the railways. In future, the Government will decide the high-level outputs they wish to buy from the railway and the public sector funding available for this.

Network Rail has been given clear responsibility for operating the network, and for its performance, timetabling and route utilisation. Train and track companies are working more closely together through the introduction of joint control rooms. The Office of the Rail Regulation now covers safety, performance and economic regulation. As part of being a company limited by guarantee, Network Rail's board is accountable to its 100-plus members. These are drawn from the industry and wider rail stakeholders including local and regional bodies, passenger groups as well as individuals. The Department for Transport is also a member.

Network Rail's members hold the board to account as shareholders would do in a PLC, although of course they have no financial interest in Network Rail. They appoint and reappoint directors, approve directors' remuneration and agree the company's annual report and accounts, but they do not get involved in the running of the company. Network Rail's priorities inevitably must be focused on the effective management of the rail network. Its first priority is to operate a safe, reliable and affordable railway and securing the network plays an important part in achieving this goal. However, Network Rail must also strike a balance between operating a safe and reliable railway and addressing environmental and community concerns.

Network Rail is accountable to its regulator, the Office of Rail Regulation. The ORR ensures that Network Rail sticks to the terms of its licence in running the network. If it thinks it is not doing a good enough
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job, it can take—or consider taking—enforcement action against Network Rail. The ORR also sets the income that Network Rail should receive and the outputs it must deliver for that income. Network Rail is also accountable to its major funders—the Secretary of State and, from April this year, Scottish Ministers. It must be for Ministers, who are accountable to Parliament, to set the national strategy for the railways. Under the new arrangements implemented by the Railways Act 2005, the Government will set the level of public expenditure and take the strategic decisions on what this should buy.

Network Rail is accountable to its local communities. The company owns 21,000 miles of track. That is a lot of neighbours, including, of course, those in the hon. Gentleman's constituency. Despite the problems in his constituency, I welcome Network Rail's ongoing engagement with wider communities and its initiatives against railway trespass; for example its innovative "No messin!" campaign last summer to warn youngsters of the dangers of "playing" on the network, and targeted at route crime hotspots.

I am glad to see that the chief executive of Network Rail is actively engaging with hon. Members through the planned line-side surgeries. I understand the concerns that the hon. Gentleman has raised, but it is a good initiative. I also believe that Network Rail is concerned about the local environment.

The hon. Gentleman raised concerns as to whether Network Rail's responsibilities to its neighbours fell short of what was expected in this instance. I very much hope the concerns of his constituents about the type and finish of the fencing can be resolved to everyone's satisfaction. But subject to Network Rail complying with the terms of its licence and relevant statutory requirements, we have no powers to intervene in operational decisions. Except in a limited range of circumstances related to security or major emergencies, Ministers have no powers to issue directions or any other binding instructions to Network Rail.

I shall certainly bring the concerns that the hon. Gentleman has raised, and his compromise proposal, to Network Rail's attention and ask it to respond directly to him.

Question put and agreed to.

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