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12 Feb 2009 : Column 503WH—continued
The key point that I want to make about the current situation concerns the recession. The figures that have been calculated were predicated on a steady growth in passenger use. That growth might continue, because people might be even more inclined to use the railways given that, for all sorts of reasons, cars might become more expensive. There could be a downturn, and, as my hon. Friend the Member for Islington, North has said, the problem with the franchise system is that companies could say to the Government, “We are not making as much money as we thought we were, so we cannot
invest in the improvements that we said we would invest in, and, by the way, you’ve got to give us some more money to keep existing services going.” I hope that my hon. Friend the Minister will tell us how the Government intend to deal with that. That might be hypothetical now, but if it becomes reality, there will be serious problems in that there will be a decline in passenger use, fewer trains and the system will deteriorate.
As a member of the National Union of Rail, Maritime and Transport Workers rail group and the ASLEF group here, I am worried about jobs. We do not want any jobs to be lost, largely because we want to build a network. Anyone who knows anything about the rail industry will know that there has been a shortage of skilled work, particularly at the top end, in terms of engineers and people who are able to do the serious thinking about how to make services better and how to have more services. If we lose employees, that will endanger the system more than anything. I hope that we will get some clarity on how we will keep people employed. This is the green new deal writ large, but there is no clear way in which that could be taken forward other than by investing in railways and the people who work on them. Losing people from the railways will be entirely counter-productive.
My hon. Friend the Member for Islington, North mentioned the letter from the three rail unions, which many of us think very sensible. Of course it is a lobbying letter, making a number of points, but as my hon. Friend showed when he read parts of it out, it contained some ideas that many, if not all, Labour Members present think incredibly good. It shows a sign of faith from the unions that they want to keep to their side of the bargain by helping the Government and the companies—I shall say more about that in a moment—but we need some stability, and we do not want job losses or any contraction in the Government’s investment programme. I shall leave that issue there.
Both my hon. Friends the Members for Manchester, Blackley (Graham Stringer) and for Islington, North have discussed accountability and structure. I should like to see a publicly owned railway, but I also recognise that there might be a stepping stone to that. The Select Committee’s report refers to the unease between the current structure and accountability of Network Rail, which is a public company. It might be limited by guarantee and it might be a strange concoction, but we could find new ways in which it could meet the public good. Some of us would like there to be real accountability, and we could find ways of moving forward in that regard. As a Co-operative MP, I draw hon. Members’ attention to the fact that the Co-operative party has produced a paper on how we could mutualise that organisation. I hope that paper is being considered seriously.
Mrs. Ellman: I endorse my hon. Friend’s comments. A lot of good could be done with Network Rail, and its performance contrasts beneficially with the disgraceful performance of the privatised Railtrack.
Mr. Drew:
I thank my hon. Friend for those comments, and I refer her to paragraph 61 of the report, and the comments of Christian Wolmar, for whom I have a lot of time, as do many others present. He knows an awful lot about the way in which railways operate.
Paragraph 61 contains his comments about the current membership structure being too weak, and the fact that if members do not like senior managers’ plans, they can do nothing except say that they do not like them.
Mark Lazarowicz: I am grateful to my hon. co-operator of a Friend for giving way. Over the past few days, have we perhaps not seen some of the problems that arise when those who are meant to be the ultimate scrutiny mechanism for a board of directors are effectively dependent on the very directors whom they are meant to scrutinise?
Mr. Drew: I agree, which is why the co-operative mutual model has some merit. The model is not the answer to the industry, but it is at least a way in which the industry could be made more accountable and restructured. I hope that my hon. Friend the Minister hears what the co-operators from our party have said and that at least some serious investigation is done by the civil service into what might become of Network Rail, given that the Committee has criticised its current structure and said that there are people in the rail industry who feel uneasy about what it does.
Indeed, as I was saying, I have talked to several people who are the so-called members and they feel that their powers to hold the management to account are far too weak and do not sit easily in relation to that body, which is important and is taking the rail industry forward. I hope that my hon. Friend the Minister will say something about that. Other hon. Members want to speak, so that is all I have to say.
4.21 pm
Mr. Eric Martlew (Carlisle) (Lab): I wish to put on the record, Sir Nicholas, my thanks to you as co-chair of the all-party parliamentary group on the west coast main line. It has been a hard road and it has taken a long time, but I think you will agree that we now have a line of which we can be proud—although I am not sure whether you got the improvements to Macclesfield station, Sir Nicholas.
The Government were brave to bring out a 30-year plan—although I suspect we might have 15, 16 or 17 Secretaries of State before it reaches the end of its term. I am looking forward to reading the plan in 30 years’ time—in fact, it will be in 28 years’ time because it has been out for two years. However, it already looks dated in some ways. I looked at the report, which I think we published last August, and that also seems dated in some ways because at that time we were talking about electrification. I think oil would have then been about $150 a barrel and we were talking about $200. Of course, now it is probably $40 or $45. The argument in that respect was probably wrong.
We were also looking forward to railway expansion. Today, we have been talking about the franchising companies possibly handing their franchise back because there has been a reduction in the numbers. However, those are the future plans. We have to ignore such minor blips and concentrate on the 30-year plan because we will get out of the recession and oil prices will go up again.
The Government got it wrong in two cases: first, in relation to the electrification itself and, secondly, in relation to the high-speed line. To give the Government credit, they have put it right in both instances. Those of us who heard the Secretary of State’s statement today will have noticed that he mentioned the electrification of the main line to the midlands—the Midland Mainline—and the First Great Western. Those were not included in the plan two years ago. In fact, doing so was frowned upon—the Government were not brave enough. Of course, there is also High Speed line 2. We are going to have High Speed 10 taken out at Companies House, but that was not in the document at all at the time—it was exactly the other way. When we saw St. Pancras station and High Speed 1 come in on budget and on time, we realised that that was the way forward. The Government have to be congratulated on putting those two things right.
I want to concentrate on a couple of issues today. I have heard many hon. Members talk about the high fares that we pay and then I heard them say, “But, we need extra improvements”—for example, in my or their constituency. I am not sure that we can both keep fares low and make improvements. The fact is that we have increased the public subsidy going into the railways from £1 billion to nearly £6 billion in the past 10 years. The idea that we will not have to pay a public subsidy, which was the promise given by the Conservatives, was, of course, nonsense. It is right to say that we can keep fares low and not increase subsidy. However, if we do that, what we cannot do is improve the railways. The reality is that if we keep fares low and do not increase the subsidy, we will have a declining railway, which happened for probably 30 years after the war. We cannot let that happen.
The other thing that we must not forget is that in my constituency, for example, where public transport is by bus, people will often not use a train from one year to the other, and parents will say that they are taking their children on the train for a treat. Are we really saying that people who never use trains should pay extra taxes for those who do? I am not sure what the answer is—although I am sure that the Minister will try to give us one. We have to be careful about saying that fares are too high. No one says that we should put more subsidy in, but that is what we mean. If we do not increase fares or increase the subsidy, we will have a declining railway.
Jeremy Corbyn: I am sure that my hon. Friend would agree that one way of looking at the matter is to consider the exorbitant profits being taken out by some of the train operating companies. Also, his argument about investment would apply to anything. People who do not have children pay taxes that help pay for education and so on. Surely, it is for the general good of everyone that we invest in a rail system?
Mr. Martlew: I understand that, but it is obviously easier for my hon. Friend to say that when we spend billions of pounds in London. My constituents have no option but to catch the bus. He is right about the money that is going into the private rail companies, and I will come to that in a moment.
We have to think carefully about the issue. It is all too easy to say, “Fares are too high; we should increase the subsidy.” However, if we do not increase the subsidy, the effect will be a decline in the railway, which is what
happened over 30 years on the West Coast Railways. That is why it cost nearly £9 billion to put things right—although a lot of it was just renewal work. We have to come to a conclusion about how we are going to deal with the matter.
Dr. Pugh: Several hon. Members have talked throughout the debate about the railway model that we have, with the rolling stock companies, the train operating companies, Network Rail and so on, and that we need to make sure that the subsidy is greater than it needs to be—even given the level of investment. The hon. Gentleman just mentioned the west coast main line, but half of the problem was the fact that we had Railtrack.
Mr. Martlew: When Railtrack was going to upgrade the west coast main line, I think the bill was £13 billion. It was only as we brought it back out of the private sector that we got the figure down to a reasonable level. There is a quandary and a question in relation to that and I do not think that people are prepared to face up to that situation.
May I now talk about the skills shortages? If we are going to have a modern railway, we need the skills. If we look at what went wrong on the west coast main line in early January—apart from the aeroplane crash, which was unavoidable and tragic—it all boils down to bad workmanship. That was the problem. It was the contractors that were used at the time; it was the lack of skills; the lack of supervision by managers; and, probably more than anything else, it was the lack of project managers. We need to get those into the industry. Network Rail is doing quite a lot. It has an apprentice training system through which I think they train more than 600 apprentices a year. There is a residential course, but unfortunately, as far as I am concerned, it is on the south coast, which is a long way for my constituents to go. We also need graduates to come into the industry. Perhaps if they are not all going into the banks, some of those high-fliers will go into the rail industry, because they will have a future there. The other problem is that the TOCs are not taking on people to gain the skills to maintain the trains because they have a franchise.
On franchising, we have a 30-year plan, but one thing is for certain: the franchises will not last for 30 years. I come from a railway family. My grandfather was a railway man and my father was a railway man. I know that privatised railways do not work. That was why the railways came into the public sector in the first place —it was not because we were greedy; it was because they collapsed. The franchising system was introduced by the Conservatives and has given us the worst of all worlds.
A company can run a good franchise and treat its staff and customers well, but that counts for nothing, because, when it goes for the next franchise, it is a blind process—the Government do not know who puts in the bid. So, when a company comes to the end of its franchise, why should it bother? It gets no credit whatever.
I must be careful with my next point, because I got it wrong during a Select Committee sitting. I said that I liked virgins, and it caused a problem. However, I actually think that Virgin Trains does quite well.
Mr. Truswell: You’ve done it again.
Mr. Martlew: I know, but it is an easy way of getting in the paper.
There has been no greater critic of Virgin Trains than me over the years, and we have had our share of ups and downs with Mr. Branson, but it has done quite a decent job. It is coming to the end of its franchise, and, when I complained to it only the other day about the inefficient toilets on its trains, a representative said, “We’re doing some work on that, but, by the time we finish, our franchise will be over and we may not get it again.” The franchising system is a nonsense. It may be all right for McDonald’s, but it does not work for the railways, so they should be taken back into public ownership.
The other easy thing for the franchise companies—we saw this with GNER—is that, if the franchise does not work, they do not have to ask the Government for more money, they just hand the keys back and say, “That’s it, it’s not working, we’re stepping away.” I advocate that we take the railways back into public ownership. Another option—I will not be popular for saying this—is to sell the business to the companies and then regulate them completely. We could have an “Oftran” and say, “You own the business, this is what you’ll do.” They would not be able to give it back, although they would be able to sell it. The franchise system does not work, but I am afraid that my Government are not brave enough to take the railways back, so we have to look at other options.
I am conscious that other Members wish to speak, and there are other things to say. The Government have been brave in bringing out their new document, and right in changing their mind on electrification and on high-speed lines, but serious consideration must be given to the balance between what we get from the fare box and from subsidies.
Finally, we must accept that the franchise system does not work and, therefore, do what I advocate. When the franchises come up for renewal, we should take them back into public ownership or consider giving the companies the responsibility for them. At the moment, they can get away with handing the keys back, and that cannot be good for the railways. It is certainly not good for the staff who work on them.
4.33 pm
Mr. John Grogan (Selby) (Lab): I have just five quick points.
First, I remind the House that there are only 316 days until Christmas, the period when the railway network shuts down for 58 hours. That issue comes before the House in the form of early-day motions every year, and we are the only nation in Europe which shuts its railway network down for that long a period. In many European nations, there are trains on Boxing day and on Christmas day, but I advocate that we look only at Boxing day. It seems unreasonable—for reasons of people travelling to meet their relatives, to go to the sales, football fixtures and, in some cases, to go to work—that there are no trains over that entire period. Although I am sure that we all love our relatives very dearly, 58 hours can be a long time. Some people also cannot leave London, for example, to go home to visit their relatives, because they have to be back at work first thing on 27 December, and there is no train to bring them back on Boxing day. Ministers have in the past given contradictory reasons:
on the one hand, they have said that Network Rail has to undertake engineering works; on the other hand, they have said that everybody deserves Christmas off. They are contradictory reasons. The railways are public services and, certainly, on Boxing day, they should be running. Lord Adonis has said that he will meet me to discuss that topic, and I was pleased that, last Christmas, the major Opposition party said that it backed Boxing day trains. I hope that the Government will do so soon, too.
Secondly, my hon. Friend the Member for Sheffield, Hillsborough (Ms Smith) was passionate and strident about the issue of high-speed rail, and she was right. It is a big issue in Yorkshire. I stress upon the Minister that, for us in Yorkshire, God’s own county, it is as big as Crossrail and the Olympics combined. It is that big an issue and, again, both Opposition parties are now committed to high-speed rail to Yorkshire and the north of England. The Government are moving on the issue, too. Indeed, in this Labour Government, we have the most pro-rail Transport Ministers whom we have ever had, so I feel confident that, before too long—before next Christmas and certainly before the general election—we, too, will be unambiguously committed both to high-speed rail to Yorkshire and, I should like to think, to a high-speed trans-Pennine link. Lord Adonis has begun to think about that, and it would be a good step.
Thirdly, I am a comparative moderate. I am much more new Labour than some colleagues who have spoken, and I do listen to Ministers, so I shall not call for the nationalisation of the railways. The next time somebody hands in the keys, however, it would be a moderate move to introduce a public sector comparator. On the south-east railways a few years ago, something similar happened: the franchise was handed back and it was run very efficiently in the public sector; but, it was then put out again to a franchise. It would be a very moderate step, indeed if we had a public sector comparator for some railways, so that a value-for-money comparison could be made with private sector companies.
Mark Lazarowicz: My hon. Friend makes an important point, but does the situation not also highlight one of the problems with the current system? The franchising system is predicated, in theory, on competition, but apart from the board of franchises and the few open-access services that then cause more problems for the rest of the network, there are no competitor services on the franchised lines and, of course, there is hardly any competition in the industry at all, because three or four major operators have most of the franchises.
Mr. Grogan:
I agree with my hon. Friend to an extent, but I disagree with him about open-access services. There are not many of them. There is Hull Trains, which serves Selby, coincidentally, and there is Grand Central, which serves York. They have innovated and linked places—largely to London, but, nevertheless, places that were not linked to the capital before. That is certainly the case with Selby and with Grand Central, a company that the Department for Transport resisted for many years. It has now linked various towns and cities in the north-east with London for the first time, so I would not be dogmatic about the issue. I would,
however, like a public sector comparator, and, where proposals are made on open access, there is a duty to consider them.
Fourthly, rural railways have not been mentioned much during the debate. There are seven stations in my constituency and, for many rural communities, they are lifelines. One line that goes through my constituency, the Leeds to Goole line, was designated as a community railway line by Network Rail in 2005. The line had five services a day but, within three months, that went down to three, so the community designation did not make much of a positive difference. I commend the Government on what will make a positive difference, however: passenger transport authorities being able to expand into rural areas, a provision that we introduced in legislation last year. I should like the trains in Selby district to be placed under the auspices of an expanded West Yorkshire Passenger Transport Authority. That would be a very good move, and it would certainly help with integrating fares.
Finally, I shall have to disagree with some of my colleagues again. My good colleague, my hon. Friend the Member for Carlisle (Mr. Martlew), Carlisle, commended Virgin Trains, but the Government should insist that all train companies offer the same refund policy when things go wrong. However much investment we have in rail, whatever structure we have administering the rail companies, sometimes trains are late—sometimes very late indeed.
Virgin is about the worst for providing refunds. A train has to be delayed for an hour before it will give any refund at all. Merseytravel is equally bad. It gives only a 20 per cent. refund after an hour’s delay. In contrast, TransPennine gives a full refund on a return ticket after an hour’s delay, and a 50 per cent. refund after a 30-minute delay. National Express, which has increased punctuality on the east coast line, also has a decent refund policy. I urge the Minister to insist that all rail companies have a similar refund policy.
I hope that by the time those 316 days elapse, we will have more train services—not just a few in Scotland or a few to Heathrow and Gatwick—and we can celebrate Christmas 2009 by going to Boxing day football fixtures on the train.
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