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Westminster Hall

Tuesday 20 December 2011

[Sir Alan Meale in the Chair]

First Great Western Rail Franchise

Motion made , and Question proposed, That the sitting be now adjourned.—(Greg Hands.)

9.30 am

Sarah Newton (Truro and Falmouth) (Con): It will be a great pleasure to serve under your chairmanship this morning, Sir Alan. Before I begin, I would like to thank my colleague, the hon. Member for Plymouth, Moor View (Alison Seabeck). Although I secured the debate, my hon. Friend, as I shall call her today, has worked very hard with Members across the region to co-ordinate our action to enable us to work as a team, because the rail franchise is important to everybody who lives in the south-west. I welcome the opportunity to debate the Great Western rail franchise before the public consultation begins, so that the Minister and her team at the Department for Transport—it is good to see them this morning—who will work on the draft franchise document, can listen to the views of key stakeholders and of hon. Members who represent constituents who depend on this vital service.

The rail franchise will not be the only one in the region, but it is vital. The Penzance to Paddington line, with all the branch line connections, is central to the connectivity of the south-west with the rest of the UK and international markets. The new franchise will be let in 2013. As part of the Great Western franchising process, the Government intend to issue a consultation document, which will include the opportunity for individuals and organisations to give feedback on the draft franchise specifications. It will be helpful if the Minister confirms today that she intends the consultations to start in January and conclude in April 2012.

I want to ensure that the mistakes of the previous Great Western franchise are learned. TravelWatch recently reported that the 2006 Great Western franchise proved unacceptable for all involved—passengers, politicians and the operator. After representations by concerned stakeholders, a fare strike and a top management reshuffle, significant timetable enhancements were made and additional rolling stock procured at extra cost to the taxpayer and the operator. We must avoid a repetition of that with the new franchise.

I have welcomed the fine words of the coalition agreement on reforming our railway system, and specifically on reforming the franchising process. In July, I welcomed the findings of the Government’s review into how rail franchising can be improved. There is widespread agreement that the existing system has become too prescriptive at the point of bidding and lacks flexibility once operational. Arguably, Government now exercise more control over the railways than they did in the days of British Rail.

Earlier this year, the Government set out the key principles for the new franchising process, which can be summarised as follows. The specifics of each franchise will be decided on a case-by-case basis, with bidders

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having a greater role in helping Government to refine and define specifications. The Government will set demanding outcomes for operators to deliver, but also give them more flexibility to decide how best to achieve those outcomes, thus giving greater space for operators to plan and run their services more commercially. Longer franchises should expand the opportunity for operators to invest in improvements, as well as enable them to strengthen their working relationships with Network Rail and other stakeholders.

There have been reviews and consultations over the past 18 months—most notably the McNulty review. As the Secretary of State said to the House last month in a written statement:

“Our railways are currently the most expensive in Europe. That is something we…must tackle. The recent review by Sir Roy McNulty found scope to cut rail costs by 30%—up to £1 billion a year. My Department is committed to working with the rail industry to develop a strategy to deliver a better value railway for the benefit of passengers, taxpayers and the wider economy.”—[Official Report, 15 November 2011; Vol. 535, c. 42WS.]

We all want to achieve that balance through the refranchising process.

The re-letting of the Great Western franchise will be one of the first of its kind to test the new process, so today, I want to share with the Minister some feedback that I have received from key stakeholders, and hon. Members will have the opportunity to give their feedback. First, I will summarise the key findings of the report published by TravelWatch in the south-west and the research undertaken by Passenger Focus. They agree with those of us who are here today that the south-west is well placed to contribute significantly to sustainable growth in the UK. Rail users and the business community see better connectivity as key to growth and the reduction of congestion, thus reducing sub-regional disparities in wealth, while accommodating the fastest growing population in England. In terms of gross value added, the south-west is projected to grow at a rate second only to that of London and the south-east. However, other parts of the UK are more productive, and that is largely due to the south-west’s poor transport links to other major parts of the UK. According to the university of Bath, productivity decreases by 6% for every 100 minutes of journey time from London.

The boom in south-west rail usage puts the industry’s planning forecasts in question. Usage has almost doubled since privatisation and virtually tripled in the Bristol travel-to-work area. Growth is not confined to the main line and the principal conurbations; branch lines throughout the south-west are the fastest growing in England, so the invitation to tender must give more priority to capacity. There is likely to be a capacity gap of about 100 million seats on mainline services over the next decade, despite the planned introduction of new inter-city express trains. The franchisee should deal with overcrowding, not by increasing fares to deter travel, but by having the right to bring in additional rolling stock without months of negotiation with Whitehall.

Mr Adrian Sanders (Torbay) (LD): I congratulate the hon. Lady on securing the debate. Unfortunately, I have to leave at 10 o’clock for a Select Committee. Overcrowding goes to the nub of the issue. We recently gained extra carriages, but that has not even kept up with the increased demand on the branch line services to which they will be given. It is crucial that whoever gets the new franchise

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plans for additional growth to ensure that people are not put off travelling because they cannot get a seat or the train is overcrowded.

Sarah Newton: My hon. Friend makes an excellent point. Like Torbay, the maritime line in my constituency, between Truro and Falmouth, has been fortunate, and we are grateful to the Department for Transport and Cornwall council for contributing to extra carriages to ease some congestion. He is absolutely right; in the new franchise, it is essential that branch lines and increased capacity on them be considered alongside the main line. The south-west has suffered the lowest level of investment in its transport network and much of the system is already nearing the end of its planned life.

The region I am talking about today stretches from Wiltshire, Bristol and Gloucestershire, across the peninsula to the west, including Dorset, Somerset, Devon, Cornwall and the Isles of Scilly. The line is well over 300 miles in an east to west direction. Road and rail arteries have to travel disproportionately longer distances than those in the midlands or the north of England, because the populations are sparse and the distances between economic hubs greater. Whitehall has not understood that peninsular geography well since the post-war nationalisation of the former regional rail companies; therefore, over the years, Whitehall business case models for strategic investment have often not delivered extra investment in the south-west.

The decision to invest £5 billion in modernising the route from London to Bristol and Cardiff and to Oxford and Newbury is welcome, but the disruption caused by work on the main line and Crossrail will be felt across the franchise until the end of the decade. Without extra investment, electrification could adversely affect millions of passengers, beyond the electrified lines, such as those using the services from the south coast to Bristol and south Wales, to Weston-super-Mare and Taunton, services west of Exeter and those parallel to the M4 corridor from east Wiltshire through west Berkshire.

The Government are committed to progressive electrification of the network, which should be a priority for lines serving major employment centres, such as the Bristol travel-to-work area. It should also be a priority for diversionary routes to Bath and the far west via Westbury, and Wales via Gloucester, because that would relieve the Severn tunnel to Wales. Bidders should be encouraged to develop proposals for additional electrification schemes and to specify how they intend to meet any capacity shortfalls.

Reliable services are essential for business and for passengers. Investment should focus on eliminating bottlenecks and enhancing capacity to ensure delivery of reliable, user-friendly, clock-face timetables. The Government say that they want people to have a voice on service provision, and we all say hooray to that. The new franchise is an opportunity to give local stakeholders a say in their rail services. It may be time to explore whether the devolution of responsibility for infrastructure and operations to local partnerships might better align services to local needs.

Timetable planning must deal with existing pent-up demand and substantial latent growth. Today’s service levels barely meet demand. The franchisee should be incentivised to provide additional services where needed,

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particularly with the surge in demand that comes with electrification. There must be a mechanism for regular reviews of the service requirement with stakeholders. Passengers need a reliable, seven-day railway and the opportunity to travel somewhere and back in a day. Rail should do more to exploit that competitive edge by speeding up longer distance journeys to places such as Plymouth, Torbay and the far west.

The franchise’s trains are already by far the oldest main line fleet in the country. Bidders should have replacement plans for the diesel train fleet, with carriage lay-out and seating designed to accommodate the needs of the contemporary passenger. Where through-services are not practical, connections need improving. They need to be made more convenient, with adequate platform staff to assist with changing trains. Better co-ordination with the wider public transport network should be encouraged, and multi-modal and multi-operator information and ticketing should be promoted. The opening up at Old Oak Common of an interchange directly linking with Crossrail to Heathrow, High Speed 2 to the north and the proposed new link to High Speed 1 and the European high-speed rail network should be supported as providing a step change in connectivity to the south-west.

Stations can be focal points for the communities that they serve. Bidders should consider their improvement with imagination, and welcome active community involvement. The ticketing system should be made simpler and ticket purchase made easier, with greater use of electronic ticketing and a less punitive approach towards passengers who mistakenly travel on the wrong train with a restricted ticket. There is a continuing need to obtain value for money from lightly-used services if they are to be sustainable. The use of less onerous infrastructure and maintenance standards and light-weight vehicles could be appropriate without in any way jeopardising safety.

South-west lines that are run as community rail partnerships have experienced record-breaking passenger growth. The franchisee should at least match local contributions, which would therefore encourage complementary contributions from local authorities and other partners. The Government should encourage stakeholders to contribute their local insights, expectations and aspirations to the specification process.

I would like to share the feedback that I have received from some of my constituents about the rail services in my constituency, which reiterate the point made by my hon. Friend the Member for Torbay (Mr Sanders). We very much appreciate our branch lines and think that they should be included in the franchise. We are very concerned that if branch lines are not compulsory and stipulated by the Department, it would be possible for a future operator to choose not to run those services if they became financially unviable. Especially for those of us from Cornwall, it is also important that the Department stipulates the need for a sleeper service to Cornwall. We would very much like to hear a commitment to the potential upgrading of the service to include modern facilities, such as en-suite showers and toilets.

In relation to the current franchise specification, the Department for Transport could also consider improving journey times between Cornwall and London. The requirement to make stops—often for very few passengers —at all stations slows the train down. I would like the

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Minister to consider whether some London trains could have fewer stops, with passengers using local services to connect with larger stations such as Truro. That would dramatically reduce the journey time between Penzance and London.

Cornwall has a fantastic record of support from the local authority, local volunteers and local business. As a result, the maritime line is the fastest growing rural line in the UK. This could be an opportunity to make partnership working and localism an integral part of the new franchise by empowering the local authority with direct involvement in the specification of services. It is also very important that the franchise is realistic about growth. The number of vehicles currently operating in our west fleet is 147. The original franchise specification for 2006 said that 102 vehicles would suffice. The new franchise must start from where we are today—cuts would be absolutely unacceptable—and recognise the considerable potential for growth over its period of operation.

The fact that there is a range of hon. Members here today representing a broad range of constituencies across the south-west shows that this is a vital franchise, which will be a very good test of the Government’s new franchise regime. We want to work with the Minister to ensure that the new franchise meets the key principles that the Government have set out while, at the same time, improving the service on the Penzance to Paddington line and the many important branch lines that support it.

9.46 am

Alison Seabeck (Plymouth, Moor View) (Lab): I want to thank my hon. Friend the Member for Truro and Falmouth (Sarah Newton)—in Christmas spirit, I will describe her as my hon. Friend for today—for introducing the discussion. This is very much a cross-party debate, and I am pleased that she has managed to secure it. I am even more delighted that she has presented the case in an incredibly well-informed and balanced way. I hope that the Minister accepts that she made a really thoughtful contribution to what I am sure will be an excellent debate.

It is essential that those involved in preparing the franchise listen to the views of MPs from across the south-west on the priorities for our region and the importance of connectivity. They also need to listen to our individual concerns about the reliability and frequency of services to the towns and cities that we represent.

In the past six weeks, I convened a meeting of all south-west MPs to discuss connectivity across our region, particularly in respect of the rail franchise. I am therefore delighted at the timeliness of this debate. The meeting was incredibly well attended, as is today’s debate. Significant numbers of people came, which is an indication of the importance that we place on getting this right. I should also put on the record my thanks—and the thanks of other MPs—to Chris Irwin from TravelWatch SouthWest, Andrew Seedhouse from Plymouth university, Ray Bentley and Neill Mitchell for helping to ensure the debate and meeting was well-informed. They supplied briefings to all colleagues and attended in person.

My hon. Friend the Member for Truro and Falmouth has drawn attention to the common themes, and I make no apology for repeating some of them. It is essential that those involved in drawing up the franchise understand

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clearly that we want the new franchise to address some common concerns. As I have said, we also want full consideration to be given to issues that are specific to our constituencies.

To be honest, predating this Parliament, we as a group allowed things to slip under the radar a bit when the last franchise was being prepared and we got caught out. When the previous franchise was announced, we found that it was set significantly below the previous standard. The standard of service then was not all that good, but when the previous franchise was first proposed, it would have made things a whole lot worse—for example, we would have lost the sleeper service.

One of the key messages that we want to send out is that we need to ensure that the starting point for the franchise is at least the base line of the current service and that it should not be any lower. I will come on to this again, but, ideally, we need to keep one or two things that we currently have. It is also essential to ensure that other Departments feed into the process.

Any reduction in service would clearly impact on business and economic growth in the region, particularly in Plymouth, where we have just lost our airport. That leaves Plymouth, the 15th largest city in England, as one of only two large cities that is more than 10 miles from a motorway that does not have an airport—the other is Peterborough. I am sure colleagues will understand that, if Plymouth is to continue to be an economic driver for the region, it is vital to have reliable, affordable and fast services to other large cities—in particular, London and Birmingham—as well as to Heathrow, and I will come to that issue later.

Will the Minister explain how she intends to ensure that the wider economic benefits of the franchise are considered across Departments? I gently suggest to her that the issues specific to the franchise, on which decisions have been made in the past about additional revenue from fares, have not fully reflected the wider benefits—those not found in the fares box. Too many Government decisions on transport and the franchise have been silo based. I urge her to talk cross-Department to her colleagues in the Department for Business, Innovation and Skills and the Treasury, as well as to seek the views of local enterprise partnerships across the region, because they, too, will have a significant input into the process.

Will the Minister say—this point has already been made, but it is incredibly important to business people in my area—whether there will be a five or six-year franchise, which is the rumour, or whether there will be something practical and sensible, such as a 15-year franchise?

The Minister of State, Department for Transport (Mrs Theresa Villiers): It might be sensible to answer that now. We published a notice in the official journal of the European Union expressing our intention to go for a 15-year franchise.

Alison Seabeck: That is very good news. I am delighted about the Minister’s confirmation, because that has been a cause of concern.

During the MPs’ meeting, it became clear from the evidence that was presented that our region’s population is growing fast. That point was made earlier, but Ministers

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and officials in Whitehall need to understand it. In my experience of two different Governments, I do not think that people really understand the south-west. They think that it is a green, leafy place where people go on holiday, but it is growing fast and has a huge potential that is being missed. If we do not get the right franchise, everything we have to offer will be wasted. That is an important point, and I particularly want officials to understand what the south-west has to offer.

All those issues need to be factored in, and we need to ensure that the mismatch in rail fares, which patently hits the south-west, is also addressed. I am afraid that that is the outcome of another botched privatisation, but there is a genuine issue that is well documented by TravelWatch SouthWest in its very good document. We have seen the Chancellor rectify or consider improving and correcting a mistake that was made with South West Water. I do not know whether anything can be done about rail fares, but they are clearly an important issue.

I will make a couple of key points about Plymouth and services into our city, and I am sure that the hon. Member for Plymouth, Sutton and Devonport (Oliver Colvile)—my hon. Friend for the day, too—will re-enforce them if he is lucky enough to be called to speak. First, as I have pointed out, there are serious connectivity issues relating to our city—a city of more than 250,000 people. Secondly, we need to enable people to do business with our city. That means being able to arrive early enough for morning meetings. Plymouth is one of the top 10 locations for fast growing business, but we need people to be able to reach us by 10 am, not by noon, so we would really like to see a train leaving Paddington at approximately 5.55 am.

We would like to see more three-hour journeys and greater reliability. The signalling improvements that are happening in Reading will help with that. We are also keen to have links to Heathrow, because, without an air link, good rail connections are absolutely vital for both business and tourism. We would therefore be interested in supporting the Heathrow hub link. Given the long journeys on the franchise—five to six hours for colleagues in Cornwall—it is essential that bidders consider both comfort and wi-fi provision. That would certainly help; a lot of business can be done on a train. I have not even touched on the importance of improving connectivity via community rail links, which are growing exponentially in the south-west, or the benefits of improving car parking, bus connections, walking and cycling linkages, which, although not directly issues for the franchise, deserve wider consideration.

Overcrowding, which has already been mentioned, is a huge issue throughout the system. It is a problem for the Paddington to Penzance main line, which is what we should actually call it, rather than lose it in the greater south-western service. As my hon. Friend the Member for Truro and Falmouth mentioned, First Great Western operates 147 trains—some 40 more trains than was set out by the original franchise. That should therefore be the base level for the franchise. Once rolling stock is freed up by changes in other parts of the country, my plea is that it should be diverted to the south-west and not channelled up to the midlands and the north, as has happened in the past.

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Our region’s rail links have been neglected historically. They are often seen as far too difficult, but we have heard already in the Chamber today, and we will hear again, a consensual call for additional resources to come to our region for good economic reasons—there is a real cost-benefit to investment. I hope the Minister is listening and will ensure that all the issues raised today are discussed at the highest level in Government.

9.56 am

Sheryll Murray (South East Cornwall) (Con): I congratulate my hon. Friend the Member for Truro and Falmouth (Sarah Newton) on securing the debate. I think we all agree that this issue is really important to all of our constituents. It is certainly an important issue for my constituents in South East Cornwall. The First Great Western train service from London to the south-west is a vital rail link for my constituency. The loss of the airport in Plymouth, and the fact that there is such a great distance between my constituency and Newquay airport in Cornwall, means that very often the railway is the only way that people can commute. I emphasise the importance of the train service for the tourism industry, and for people visiting family and friends. I thank my right hon. Friend the Minister, who is due to visit one of my branch lines in January to see for herself what beautiful lines we have in Cornwall, but also how important they are. I am very grateful to her for visiting south-east Cornwall.

As the Member of Parliament for South East Cornwall, I use the First Great Western service from Liskeard to London frequently. There are major issues that I have noticed, which my constituents continually bring to my attention, and I will share them with the Minister. As has been referred to by my hon. Friend the Member for Truro and Falmouth and the hon. Member for Plymouth, Moor View (Alison Seabeck), rolling stock and overcrowding are big issues. Frequently, we have to change in Plymouth to carry on through to Penzance and use the small, two-carriage rolling stock, which is continually overcrowded and has luggage kept in the aisles. The amount of luggage compromises the safety of passengers on board. I recently witnessed one instance where a wheelchair user was unable to board the train in Liskeard, due to the amount of luggage on the train.

Alison Seabeck: I, too, have witnessed everybody trying to pile into those two carriages, because I get off at Plymouth. In the summer, when people have large surfboards—Cornwall is great for surfing—it must be almost impossible at times for people to get on, never mind somebody struggling with a wheelchair or a buggy.

Sheryll Murray: The hon. Lady is absolutely correct. I have been on the train when many passengers have been forced to stand. What a lot of people do not understand is that someone who buys a first-class ticket from Paddington to Penzance and has to stand on the two-carriage train is entitled to a refund. The excessive cost represented by that could be channelled into improving the rolling stock. I ask the Minister to ensure that the provision of better rolling stock is included in any future franchise.

It is bad enough for someone such as me who is only travelling across the Tamar to Liskeard, or to Bodmin Parkway station in my constituency, but the journey

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must be horrendous for passengers travelling through to Penzance, especially during peak times. In September, I tabled a question to the Secretary of State for Transport about whether there were any plans to introduce new rolling stock on the First Great Western main line west of Plymouth in the next four years. The Minister replied:

“The Government are committed to a less prescriptive approach to the specification of rail franchises, with decisions such as rolling stock provision devolved primarily to franchise operators.”—[Official Report, 12 September 2011; Vol. 532, c. 992W.]

She might be interested to know, however, that First Great Western has told me that it is a Government problem. I ask her to ensure that the requirements for larger and improved rolling stock are included in the franchise specifically, so that there is no question about who is responsible in any future franchise.

Finally, I also make a bid for the retention of the sleeper service, which is the only way that I can get back to my constituency, given the sitting hours of Parliament and the need to start in my constituency at 9 o’clock on a Friday morning. Without the service, we would all be at a loss. I also emphasise how much it is used: in my experience, sometimes, it cannot be booked even a fortnight ahead because it is fully subscribed. The service is not underused—in fact, we could do with more carriages, not fewer.

Several hon. Members rose

Sir Alan Meale (in the Chair): We have a number of Members standing, and it is my intention to bring in the Front Benchers from 10.40 am, so can you act with a little bit of brevity?

10.2 am

Duncan Hames (Chippenham) (LD): I congratulate my hon. Friend the Member for Truro and Falmouth (Sarah Newton) on securing the debate. I share the commitment of the hon. Member for Plymouth, Moor View (Alison Seabeck) that the Members of Parliament for the region covered by First Great Western will not be caught out in the franchise renewal, because that was certainly the experience of my constituents, in particular in Melksham, albeit before my constituency was created. Under the current franchise, a popular and well used service was cut to only two trains each way a day, and those trains run at times that are totally impractical for anyone hoping to use them for a sensible commute for a humane working week. I am determined that that should not be allowed to happen under the new franchise, but that instead we will see the franchise get Wiltshire moving and help people in my constituency to use the railways to get to work.

Three key, interrelated factors make a difference to the railway experience and to the potential of the railways to serve my constituents: service frequency, capacity and connections. Connections are an important solution to the conundrum, because they create the opportunity to relieve capacity and overcrowding in capacity bottlenecks and to increase the journey options, thereby disproportionately increasing service frequency for communities. In Wiltshire, we could have a few particular opportunities under the new franchise.

The railways Minister is more than familiar with the TransWilts rail service, which I have raised with her on countless occasions in the past 18 months. I am sure that she was as pleased as I at the success over the summer of the TransWilts rail partnership trial of extra

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Sunday services between Westbury and Swindon via Melksham. The take-up and the feedback on the service were good, and next year the partnership hopes to extend the trial to between May and mid-September. The TransWilts campaign group has comprehensive research behind it, demonstrating not only the need for more services but their cost-effectiveness and the strong support from the business community in our area for improved services through Melksham. The franchise specification process is an ideal opportunity to build upon that work; no line in the south-west region is better prepared for an expansion in services, having enjoyed them so recently, until the current franchise.

I was encouraged by the Government’s willingness to listen to us about the problems of overcrowding in my area, and chiefly by the prospect of additional capacity on the Cardiff to Portsmouth line which runs through Bradford-on-Avon in my constituency. There was certainly progress last Monday, when First Great Western announced two extra carriages on the 07.30 from Cardiff to Portsmouth, but only as far as Bristol Temple Meads. Unfortunately, that will not benefit Bradford-on-Avon passengers, who are still frequently unable to board trains or, even when they get on a train, to get a seat. That problem is not unique to Bradford-on-Avon or to my constituency; I often travel on First Great Western on Sundays and it is astonishing that even on Sunday afternoons it is not uncommon to find that one cannot get a seat on a First Great Western service into Paddington. Demand locally has risen well above the national level of growth, and I implore the Minister to consider overcrowding once more in further franchise specifications. I would appreciate her reassurance that in the Great Western franchise renewal process, bidders’ proposed efficiency measures will not be looked upon favourably if they involve cutting carriages and reducing seats. Franchisees should be required to deal with overcrowding not by pushing down demand with increased fares but by increasing capacity. Central Government can help by simplifying the rolling stock allocation system.

I have corresponded with the Minister about the opportunities presented by the new franchise, in particular on the prospect of services between Oxford and Bristol. I welcome the Chancellor’s support in the autumn statement for services between Oxford and Bedford, which will improve connections between west and east as far as Cambridge. There is a wonderful opportunity, on existing railway infrastructure, to extend the potential of such services with an Oxford to Bristol service under the Great Western franchise. Quite aside from the benefits of linking such high value-added university economies, there is also the opportunity of the reopening of Corsham station, which would be served by trains on that route.

Moneys have been set aside under section 106 agreements for redeveloping Corsham station, but progress has been slow and a real risk is that the developments seeking to contribute to improved railway infrastructure will have happened too long ago to draw upon. A commitment on Corsham station early in the course of the new franchise would be welcome. It should be noted that the road infrastructure often benefits from section 106 agreements. Substantial development of housing and employment sites around Melksham in my constituency has included funding for distributor roads and even a small bypass but, in that time, not a penny has been contributed to the rail infrastructure on which those same homes and businesses will depend.

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I want to touch on the role of local authorities in the franchise renewal process. For a Government who believe in localism, it is important to ensure that the democratic voice of local areas is heard when determining the new specifications for the franchise. Liberal Democrat councillors in Wiltshire recently tabled a motion noting the opportunities that the stakeholder consultation presents for improving the county’s rail network. They welcomed the Minister’s encouragement to the council to

“discuss the potential for a Corsham station and a new Oxford-Bristol service with all bidders for the franchise”.

Welcoming the motion, the holder of the council’s public transport portfolio noted that, traditionally, the council has had nothing to do with the railways but that it now had clear objectives to include in the new franchise a number of the local schemes which I have mentioned this morning.

We could make the improved TransWilts service permanent. The council is bidding for £5 million from the local sustainable transport fund. I hope that the Department will look favourably on the innovation of that bid, and its value in connecting three mainline services across the county and therefore dramatically improving the options for journey planning for my constituents by linking services calling at Westbury, Trowbridge, Melksham, Chippenham and Swindon on existing railway infrastructure. The council is certainly determined to support an Oxford-Bristol service, which would allow new stations at Corsham and—I am sure this will interest hon. Members from Swindon who are present—Royal Wootton Bassett, which would be more accessible for some of their constituents than existing services at Swindon.

I am encouraged by the council’s willingness to engage with the Government, and I am keen to hear from the Minister how she plans to reciprocate that willingness to engage, and what mechanisms she is considering to incorporate in the specification process the views and recommendations of local authorities, and of the hon. Members who have come to this debate. I look forward to hearing her thoughts on that.

10.11 am

Oliver Colvile (Plymouth, Sutton and Devonport) (Con): It is a pleasure and a delight, Sir Alan, to serve under your chairmanship. I thank my hon. Friend the Member for Truro and Falmouth (Sarah Newton) for this debate, and congratulate her on securing it. During the debate, we will speak as a group of Members of Parliament with one voice. My constituency is the other half of Plymouth from that of my hon. Friend—for this morning—the Member for Plymouth, Moor View (Alison Seabeck).

I want to set the context for Plymouth. Around 250,000 people live in the city. We are a low-wage and a low-skills economy. We are the home of the Royal Navy, although other hon. Members may dispute that. We have a nuclear licence for our nuclear submarines, which makes Plymouth an important part of our defence. We have a brilliant, dynamic university. We have a reputation for being the global leader in marine science engineering research, and we must talk that up much more.

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Members of Parliament from Devon and Cornwall make up around 19% of the coalition Government’s membership, so it is important and would be helpful if the Minister recognised that when she makes decisions. I know that, after the 2005 election, three Labour Members of Parliament worked hard to try to convince Ministers, but I suspect that they did not have the political clout to do so. We are in a unique position to ensure that we get the story right.

Plymouth feels incredibly isolated. Not only are we losing the airport—believe you me, I for one have been subject to an enormous amount of correspondence and discussion about that—but we have only one proper dual access to the peninsula, and we saw last month, when the M5 crash happened, how difficult that can be. Just last Friday, as I was driving to my constituency, I was stuck on the A38 for three hours because there had been a car accident that required the Devon air ambulance to pick someone up. It made it difficult to get there.

There is real concern about the lack of transport infrastructure, and a genuine feeling that no one is interested in hearing what happens in Devon and Cornwall, and certainly in Plymouth. Some 38% of people who work in Plymouth do so in the public sector. If we want to rebalance our economy, we desperately need to ensure that we have the necessary transport infrastructure. If we are successful in that, there will be an enormous roll-out throughout the regional economy, and we need that.

The First Great Western franchise is up for grabs again. It has decided not to put in for an extension to its current franchise, because it is keen to ensure the necessary investment in infrastructure, new trains and so on. We know that train journeys may be badly delayed during the winter, especially when the sea wall at Dawlish is flooded in a big way. We have an opportunity to ensure that we get the infrastructure right.

What do we want? We want more three-hour train journeys to and from London, and we want to make sure that we can get from London to Plymouth before 11 o’clock in the morning. If people want to do a decent job of work, they want to ensure that they can meet people at 9 or 10 o’clock. As my hon. Friend the Member for Plymouth, Moor View made clear, that is a key issue.

We need decent access to Heathrow. If we lose our airport, which, unfortunately, I think we will—I shall do everything I can to try to ensure that that does not happen—we must ensure that we have good connections to airports. Our best regional airport is Exeter, and it would be helpful if we could have a good bus link straight in to the airport, or a decent rail link so that people can get away.

We need to retain the rail sleeper service, and we need good wi-fi on trains. If business men want to work while travelling to Plymouth, they want to be able to communicate with their customers, and that needs to be not just in first class, but in second class if we are to be inclusive.

The cost of tickets is horrendous. When I travel back to London as I occasionally do on the railways on a Sunday, engineering works prohibit me from getting back in good time, and the journey can take for ever.

Another point is that electrification of the line to Plymouth is important. When Michael Ancram was deputy leader and chairman of the Conservative party

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he came to Plymouth, went to see Tim Smit who runs the Eden project, and asked him what was the one thing that could regenerate activity in the peninsula. Tim Smit’s reply was electrification of the line.

I pay tribute to Neil Mitchell, an independent transport consultant who has worked incredibly closely and done an incredibly good job on the matter. Our meeting the other day with all the Members of Parliament in Devon and Cornwall was incredibly helpful in ensuring that we got some of our message across.

My final point is that Plymouth is not Portsmouth. We are not 20 minutes from Bristol. Please make sure that we stop being ignored.

10.18 am

George Eustice (Camborne and Redruth) (Con): I congratulate my hon. Friend the Member for Truro and Falmouth (Sarah Newton) on securing this debate, which is important to all of us in the far south-west. I want to touch on three key matters: first, the franchising system, and particularly the duration of the franchises; secondly, some of my concerns about the consequences of electrification for those of us in the far south-west; and thirdly, the sleeper service.

I welcome what the Minister said about the commitment to 15-year franchises. The matter was causing some concern in the industry because there had been speculation that the Government might be backing away from that. It is incredibly important with issues such as transport to make a long-term commitment to provide the right environment for investment. A couple of years ago I attended a speech by the former Secretary of State for Transport, Lord Adonis, who said that, although transport is invariably about long-term infrastructure investment decisions, in the past 50 years, Britain has had some 45 different Transport Secretaries. That shows how difficult it is to maintain a long-term perspective. The hon. Member for Plymouth, Moor View (Alison Seabeck) pointed out some of the problems with privatisation, and a key one was that it encouraged too much short-termism, short-term franchises and a system for sweating assets instead of investing in them for the future.

The Conservative party recognised that when in opposition, and for some years we have been committed to the idea of longer franchises. We recognise the benefits of vertical integration in which train companies are encouraged to invest for the long term. Such a step will be welcome in the industry.

As we know, the line will not be electrified all the way to Penzance in the foreseeable future, but the Government are committed to progressively electrifying the south-west line and the first phase of that will be the electrification of the line to Newbury. In order to accommodate that, I understand that the Government are considering investing in bi-mode trains that run on electric wires when they are in an electric area, and then switch to diesel when they are not. The concern, however, is that the trains currently selected for such a use do not have diesel engines that are sufficiently powerful to deal with the gradients west of Newton Abbot. When Brunel designed the track into Cornwall he came up with an interesting way of using tracks that could deal with steeper gradients, while at the same time designing trains that could work on those gradients. It would be a sorry state of affairs if after all these years we end up with trains that cannot work on such gradients.

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The Government say that they will continue to use high-speed diesel trains on the Penzance line. What will happen, however, if the line is electrified to Taunton, Exeter or even Plymouth? How long will it be before people say that since the line has been electrified that far, we can no longer justify diesel trains that go all the way to Penzance? How long will it be before those of us who live in Cornwall arrive at Exeter and hear the words, “All change please, this train terminates here” before we get off and are invited to board a rickety old train that no one else in the country wants to use? It is important to think ahead, and unless the entire line is going to be electrified in the foreseeable future, we must invest in bi-mode trains that are capable of going all the way to Penzance. That will mean that, even if the line is electrified as far as Exeter, the rest of us will not have to change but can remain on the same train.

I know that the Minister used the sleeper service to Penzance while in opposition, so she will know what a crucial link it is for those of us in Cornwall. At a time when we are trying to discourage excessive flights, particularly domestic flights, the sleeper service provides a vital link for the business community. The sleeper service beats flying by a country mile and is the only service that enables someone to work in London until 11 o’clock, and then get on the train and be in Cornwall in time for an 8 o’clock meeting the following day. It is also the only service that will get someone into London from Cornwall in time for an early morning meeting. Last time the service was threatened, a vociferous and successful campaign was led by the late Sir Eddie George—I signed his petition to preserve the service. I now use the sleeper service almost every week and I would recommend it to anyone; it is the most civilised way to travel to Cornwall and the staff are superb. It would be a real failure if we were to lose it.

Last time the sleeper service was under threat, there was some suggestion that the issue was not only its financial viability, but that Network Rail wanted to do engineering work overnight and found the sleeper train rather inconvenient. It should not, however, be beyond the wit of man to deal with that issue and park the train somewhere while engineering works take place. I would like some reassurance from the Minister on that point.

We must think carefully about the type of bi-mode train in which we invest for the future, and if we cannot significantly reduce the journey time to west Cornwall in the foreseeable future—it is a five-and-a-half or six-hour train journey—we must ensure that the experience is as comfortable and enjoyable as possible. That is why we need a franchising system that encourages investment in the long term. I am concerned that, by being too prescriptive about minimum standards, the Railways Act 2005 encourages a kind of Dutch auction. We need a competitive system where companies compete to offer a better service, and where that is given more weight than the amount of money tendered. I hope that the Minister will take those points on board.

10.24 pm

Mr Robert Buckland (South Swindon) (Con): It is a pleasure to serve under your chairmanship, Sir Alan, and I congratulate my hon. Friend the Member for Truro and Falmouth (Sarah Newton) on securing a debate that I think most hon. Members in the Chamber have bid for at some stage. Fortunately, she got lucky

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just before Christmas, and I am grateful to her for that. I am also grateful to the Minister for attending the debate. We have had many discussions about rail services to and from Swindon, and she knows the passion that I and my hon. Friend the Member for North Swindon (Justin Tomlinson) feel for railways, especially considering Swindon’s unique railway heritage as the hub of the Great Western Railway. We regard Swindon as its home.

To bring things bang up to date, Swindon is a thriving town of 200,000 inhabitants, with rail services that run to the west, the east, the midlands and the south and are relied on by thousands of commuters in the town and region. Connectivity to London, Heathrow and other parts of the south is vital, and time and again that is cited as an important issue to local businesses and passengers.

The draft franchise document will be of huge significance and must meet the aspirations of rail users, both passenger services and freight. It must also be based on a correct set of specifications. In short, the mistakes that were made in the 2006 franchise must not be repeated; we must not step backwards. We must start by looking at the current service, rather than holding a Dutch auction—as my hon. Friend the Member for Camborne and Redruth (George Eustice) said—to see who can get to the bottom the fastest.

Since 2006, there has been a race to rectify some of the problems that have been created. How many of us have had to endure problems with punctuality, for example, and how glad are we that much has been done to rectify that situation? The recent Government announcement about extra capacity will provide some relief, but we are running to stand still. As I have said, those issues were not properly addressed.

Neil Carmichael (Stroud) (Con) rose

Mr Buckland: I do not have time to take an intervention because other Members wish to speak.

Unless the new franchise delivers a service that is punctual and has appropriate capacity and competitive ticket prices, it will have been a missed opportunity. To put it bluntly: if our passengers do not get value for money, we will have failed.

Peak fares from Swindon remain unduly high compared with those from neighbouring stations and other parts of the network. That seems to be a hangover from another time, and it is causing a competitive disadvantage. Season ticket holders who have to travel at peak hours and are captives of the service now pay in excess of £7,000 a year, yet the service that they receive does not even guarantee them a seat at certain times of the day. That is wrong, and I believe that the terms of reference and the franchise process must specifically address the needs of frequent users and season ticket holders. I accept that smart ticketing may help, but I feel strongly that more needs to be done to cater for that group, perhaps by introducing reserved seating, for example, or by offering an enhanced service that makes people feel valued.

The link between improved rail services and wider economic benefits is clear, and we should factor in such considerations to the franchising process. Just as road

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schemes are often justified in terms of their wider economic benefit, we must ensure that the Department for Business, Innovation and Skills and the Treasury are involved and engaged with the rail service to allow the fullest exploration of any wider economic benefits. Locally, we need strong engagement between the Department for Transport and the new Swindon and Wiltshire local enterprise partnership.

Justin Tomlinson (North Swindon) (Con) rose—

Mr Buckland: I will give way on a local point.

Justin Tomlinson: Briefly, it is not only the LEP that is supportive of such an initiative. We regularly meet different business forums that highlight transport as a No. 1 priority. Swindon’s economic base has grown, owing to businesses relocating there, but the biggest barrier to that is the cost of train travel.

Mr Buckland: I am grateful to my hon. Friend for raising that local point, and I will develop it briefly. I have been looking at the regional significance of Swindon, and I would like to echo the points made by my hon. Friend the Member for Chippenham (Duncan Hames) about the importance of developing local services and local branch stations. For too long, obstacles have often been put in the way of the development of local services, because of the needs of the main line. Again, we need to examine the tendering process and ensure that options such as the development of a branch station just to the west of Swindon, which the Minister knows I am passionate about, will become a reality.

There is no reason not to be optimistic about rail in the south-west, because, as we have seen, the growth is exponential. More and more people are using rail services. Therefore, the franchise needs to be an optimistic one. It needs to be based on an upward projection of growth and to avoid the lamentable mistakes of five years ago. I am delighted that the Minister has listened to my protestations, among others, and that the Government have preferred a 15-year term for the franchise, rather than something shorter. My right hon. Friend has been saying yes to many of my requests recently and yes to many of the demands of the people of Swindon. I hope that she will say yes again to some of the observations that we have made about this vital process.

10.30 am

Neil Parish (Tiverton and Honiton) (Con): I congratulate my hon. Friend the Member for Truro and Falmouth (Sarah Newton) on securing the debate. I will be brief because one more Back Bencher wants to speak. I also congratulate the Government on going for a 15-year franchise, but of course with that comes the responsibility to get it right, because it is a much longer-term contract. My hon. Friend made the point that it will also give the company the chance to put in the investment that will improve services.

May I make the point that the west country does not stop at Bristol? Although Bristol is very important, much of the west country is west of Bristol. My Cornish friends are very welcome here this morning; but of course, to get to Cornwall, one has to go through Devon. I therefore make a plea for us to build on the junction at Tiverton in my constituency. We want to

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increase the industrial parks around Tiverton, so there is a chance to move some industrial goods by rail at Tiverton. In the future, a new station at Cullompton would also be very much welcomed.

Ours is a very important part of the country. If we consider the issue from a tourism angle, we find that people come to London first, and then if they are asked where they want to go next, they say that they want to go to the west country, particularly Devon and Cornwall of course. They quite like Somerset and they occasionally go to Wiltshire and occasionally stop off in Bristol. To be serious, we do need that business. Plymouth airport is being closed. The airport at Exeter is building up, but it is not yet big. Bristol airport is doing quite well. However, many people still come in through Heathrow, so the contacts between areas and getting to and from Heathrow and the railway are also important issues.

All those matters need to be taken into consideration. As I said, the Government are right to go for a 15-year contract, but we need to consider the relevant issues very carefully when we award that contract.

10.33 am

Richard Graham (Gloucester) (Con): I am grateful to have the opportunity to speak towards the end of this most important debate. The tender of the First Great Western franchise is of key interest not just to my constituents in Gloucester and throughout the county of Gloucestershire, but, as we have heard, across the entire south-west region. I hugely congratulate my hon. Friend the Member for Truro and Falmouth (Sarah Newton) on securing a debate that is of such importance to, I suspect, about 40 coalition MPs and a handful from the Opposition.

There are six key issues to canter through in relation to the retendering process, and I am sure that my right hon. Friend the Minister responsible for rail will be listening carefully, as she has been all morning to the points made by hon. Members. First, I agree with my hon. Friend the Member for Camborne and Redruth (George Eustice) about thinking long term. A long-term franchise must be good for the region. It requires us all to respond ambitiously in thinking 15 years ahead.

My hon. Friend the Member for Truro and Falmouth referred to growth and capacity. Certainly on the London-to-Gloucester line, it is crucial that we have more trains, both in the mornings, inevitably, and in the evenings. There is no service to Gloucestershire after 7.45 pm other than the one that leaves at 11 o’clock at night and arrives the next morning. Additional capacity is therefore very important. I appreciate that there are capacity problems getting into Paddington, but we do need more.

With regard to punctuality, it is worth noting that significant progress was made on the First Great Western service after 2005, but the recent decline or deterioration, which is possibly connected with Network Rail’s failings, needs to be examined.

On where the trains stop and the speed of the service, all First Great Western services currently stop at Gloucester, and that must continue after the redoubling of the Swindon-Kemble line, which is so important to us all. However, it is not obvious to me why every train should stop at every little station on the Cotswold part of the journey. I am thinking about the service being speeded

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up. It is worth noting that it is slower between Swindon and Gloucester than a car journey, except at peak traffic times.

The Minister will know how grateful we all are to have heard about the plans for electrification to go as far as Swindon on the journey that we are discussing, although not all the way to Gloucester and Cheltenham. We should definitely be considering that within the lifetime of the franchise.

A number of hon. Members mentioned difficulties with fares. The issue involves price and, almost as important, the need to rationalise the number of different fares, so that the process is simpler and easier to understand. The difference between an off-peak and a full-fare single journey between Gloucester and Paddington is the difference between £25 and £85—an enormous multiple.

I should be grateful to the Minister if she said whether the fact that there have been additional carriages on the service in the last year of the franchise will be taken into consideration during the retendering process. I think that that is important. It is also worth asking whether infrastructure at stations can be included in the tendering process. At the moment, we need a new ticket office and revenue protection barriers. Those will be going in shortly, but certainly within the lifetime of the new franchise, we also need to have a separate waiting room and ticket office. That is important for customers at Gloucester.

Overall, the crucial point that I would make, which has been made in different ways by several hon. Members, is that we all agree that train travel—rail travel—is a critical catalyst for growth and a key part of our transport infrastructure. It is true to say that in the south-west it has been rather overlooked in the past and, arguably, in the present, with all the excitement about High Speed 2. I therefore add my voice to those of hon. Members who have already spoken to ask the Minister to look favourably on ways to improve capacity, punctuality, electrification, infrastructure and fare rationalisation on this important line from Paddington to Gloucester and Cheltenham and to support the growth of rail services across Gloucestershire and our region.

Sir Alan Meale (in the Chair): Before we hear from the Front Benchers, I point out that there is one hon. Member who stood but was not called. It may be appropriate if Mr Carmichael catches the eye of either one of the Front Benchers if he still wishes to speak.

10.38 am

Lilian Greenwood (Nottingham South) (Lab): It is a pleasure to speak under your chairmanship, Sir Alan. I begin by congratulating the hon. Member for Truro and Falmouth (Sarah Newton) on securing the debate and on setting out so clearly the needs of local people and businesses in the south-west.

The debate is very timely, given yesterday’s issuing of the invitation to tender for the Great Western rail passenger franchise. It may be a coincidence that that was published on the eve of the debate, but if not, I congratulate the hon. Lady on prompting Ministers to get at least that part of their franchise programme on track.

I am sure that the Minister has listened carefully to the concerns of hon. Members on both sides of the House who are here to represent constituencies right

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along the route in relation to the new franchise. I shall pick out just a few of the key points that they made. They talked about ensuring that the baseline for the new franchise is no less than the current service, the need for fares to be affordable, the need for faster services, especially for the benefit of business passengers—the south-west region depends on businesses for economic growth—the importance of a link to Heathrow airport, the vital importance of tackling overcrowding, and the retention of a sleeper service to Cornwall. I hope that the Minister will be able to provide some assurances on each of those points.

Several Members welcomed the opportunity to provide long-term investment, but that surely requires a degree of certainty. It is therefore of great concern that invitations to tender for franchises are being issued before the Government have decided what their franchising policy is. The First Great Western franchise ITT states:

“The contract will be based on the Franchise Agreement currently being revised in line with Government policy.”

It would surely have been sensible to finalise the franchising policy and the franchise agreement in time for the publication of the invitations to tender.

Unfortunately, it is not just the franchise agreement that is yet to be finalised by Ministers; the entire rail strategy is now running late. The departmental plan promised to:

“Develop and publish detailed proposals on delivering a sustainable railway including reform of Network Rail”,

but that, along with so much else, has slipped back to 2012. It seems that the Secretary of State inherited an in-tray overflowing with decisions her predecessor had sat on. Given yesterday’s determination by the Office of Rail Regulation that Network Rail is in breach of its licence because of the worsening performance on the national network, passengers are right to be frustrated that there is no sign of the promised reform.

As the process of renewing the franchises begins, we are left with more questions than answers. For example, we are no nearer knowing how committed Ministers are to rail devolution, and neither are prospective bidders. The ITT says:

“In line with the Government’s aspiration for decentralisation, the franchise may be let so as to permit future changes in the way that discrete parts of the network”—

Mrs Villiers: I feel obliged to correct the hon. Lady. We have not issued an ITT for First Great Western yet. The ITT comes after the consultation. If we issue the ITT before the consultation, we are unable to take on board the views of stakeholders. I am not sure what ITT the hon. Lady is reading from, but it is not First Great Western’s.

Lilian Greenwood: I thank the Minister for her clarification, but it is the information that was published yesterday in relation to the future franchise.

The publication the Minister produced mentions

“changes in the way that discrete parts of the network are financed, monitored and managed by organisations other than the DfT.”

The Opposition support rail devolution, which should go hand in hand with stronger transport authorities. We

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would like parts of the country such as the south-west, which do not currently have the benefit of integrated transport authorities, to have them. That would give the constituents of hon. Members who are here today more control and the opportunity to ensure that their needs are met. Could the Minister therefore update us on progress on rail devolution? What plans does she have for the devolution of services in the south-west? Will she confirm that devolution relates to funds and not just responsibilities? In parts of the country such as the south-west, which do not have an integrated transport authority, who, other than the DFT, does she envisage will be the relevant organisations?

The Department is similarly vague on the eventual reforms to cost and revenue risk, saying only:

“Revenue risk will be subject to a support mechanism probably linked to economic factors”,

but “probably” seems a bit vague for this stage in the process. Will the Minster therefore provide further details of how she intends to ensure that taxpayers get a fair deal from the new franchise and that we do not have a repeat of the licences to print money we have seen in recent years?

The Opposition have been highly critical of the way in which First Great Western has been able to end its 10-year franchise three years early—before the Minister jumps to her feet again, let me say that I appreciate the fact that the contract was agreed under the previous Government. I hope this Government have learned the lessons from the franchises that were signed in the years following privatisation so that contracts do not back-load premium payments while allowing a break clause. That has enabled First Great Western to avoid payments of an estimated £826 million, while, as now looks likely, bidding to run the franchise again.

There are also questions about what is to happen to the stations on the First Great Western line, and several Members have raised particular concerns. The invitation that has been issued states:

“The franchisee will be expected to take full repairing leases on some or all of the stations that it operates other than on Network Rail managed stations.”

Why is there the reference to

“some or all of the stations”

and what will happen to the others? If a private train operator takes control of stations, will that be within the 15-year franchise, or on the basis of 99-year leases, as Ministers have suggested? If it is within the 15-year franchise, what will happen at the end of the 15-year period? If the franchise changes hands in 15 years, one possibility is that there will have to be a significant payment to the outgoing train operating company, thereby skewing the refranchising in its favour, or are Ministers opening up the prospect of an operating company retaining the management of the stations even after losing the franchise to operate the trains? Potentially, we could see station access charges as well as track access charges, with yet more work for lawyers, more fragmentation and more cost to the taxpayer.

There are also questions about the trains to be used on the First Great Western line under the new franchise. The document says:

“It is currently expected that the franchise operator will take responsibility for the provision of rolling stock. From 2017 new Intercity Express Trains (‘IEP’) are anticipated to be delivered to the franchise operator”.

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Will the Minister explain why it is only “expected” that the new franchise holder will be responsible for rolling stock? Will she confirm that the Department cannot force the new operator to lease the IEP trains? Given the Department’s admission that the leasing costs for the IEP trains will be greater than for the alternatives, what assurances can she provide that the IEP trains will actually be put into service? Will she give more details about the discussions First Great Western, and indeed East Coast, are reported to have had with rolling stock companies about potentially using more Pendolinos on these franchises, as opposed to the IEP trains being built by Hitachi? It is incredible that the taxpayer has spent tens of millions of pounds developing these new trains, on which jobs in the north-east depend, when responsibility for leasing trains rests with the private operators. As several Members have said, it is vital that the new franchise increases capacity to tackle overcrowding, rather than pricing passengers off the railways. The hon. Member for South East Cornwall (Sheryll Murray) graphically described the problems of overcrowding on inadequate train carriages. It is therefore vital that we know what rolling stock is to be delivered.

Potential operators of the new franchise are also having to bid without the Government’s having decided how best to address the clear need to improve links to Heathrow and High Speed 2—if the Government decide, as we hope they do, to give HS2 the green light. As the document says:

“Options for longer term enhancements of rail links to Heathrow, such as Western Access and Airtrack Lite, are being considered”.

Whether they go ahead will have a significant bearing on the franchise. Will the Minister provide an update on the Government’s thinking on the issue, particularly given that several Members, including my hon. Friend the Member for Plymouth, Moor View (Alison Seabeck) and the hon. Members for Plymouth, Sutton and Devonport (Oliver Colvile) and for South East Cornwall have highlighted the loss of Plymouth airport and, therefore, the importance of establishing such connections?

As hon. Members know, the Opposition have put forward their own proposal, which would offer the south-west significant benefits in terms of access to Heathrow and HS2. Our policy review concluded that we were wrong to reject the proposal to create a major new transport hub near Heathrow linking HS2, Crossrail and the First Great Western main line. We have proposed moving the west of London stop from Old Oak Common to near Heathrow. That was previously the Conservative party’s policy, and it was backed at the time by the Minister. Indeed, some tell us—quite authoritatively—that she may still hold that view.

As the Minister will know, the creation of a Heathrow hub has several benefits. First, it has the potential to save taxpayers money, by removing the need to build an expensive spur to Heathrow during the later stages of the HS2 project and opening up the potential for greater private investment in the scheme. Secondly, it will benefit Heathrow by improving access to our major hub airport, especially from the south-west. Thirdly, it will increase the potential for more of the country to feel the benefits of HS2, not least by improving connectivity to the south, the south-west and Wales. HS2 will benefit the nation as a whole, but those living in parts of the country that are not directly served by it need to feel

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that those benefits are real to them. Fourthly, taking the high-speed line direct to Heathrow from the start will inevitably change the route and open up the prospect of making greater use of existing transport corridors and avoiding the widest part of the Chilterns area of outstanding natural beauty.

The debate gives the Minister a timely opportunity to provide clarification on the many questions that need answering regarding the Government’s rail franchising policy and particularly the tender for the First Great Western franchise. Passengers in the south-west need and expect a better rail service than the one they have at present. With six of the 10 most overcrowded services running out of Paddington station, there is a considerable need for the investment the Labour Government set in motion, not least for the further electrification of the First Great Western main line.

As well as investing in infrastructure, we need to improve the way passenger services are delivered. The Opposition are clear that that requires the genuine devolution of rail services and a fundamental review of the very structure of our rail industry. Given that the Government look set to maintain the existing industry model, we need, at the very least, to have tough new rules for rail franchises. We need to ensure that the often poor quality of service experienced by rail passengers in the south-west, which Members have described today, is not repeated in the future.

10.49 am

The Minister of State, Department for Transport (Mrs Theresa Villiers): It is a pleasure to serve under your chairmanship, Sir Alan, as ever. I congratulate my hon. Friend the Member for Truro and Falmouth (Sarah Newton) on securing the debate at such a timely point. Yesterday, the Government fired the starting gun on the process for selecting the new franchisee with the publication of a notice in the Official Journal of the European Union. We propose to issue a consultation in the next few days, which we expect will close at the end of March. The debate is thus well timed, and I welcome all the speeches that have been made. As my hon. Friend the Member for Plymouth, Sutton and Devonport (Oliver Colvile) put it, all hon. Members spoke with one voice about the importance of the process that we are undertaking. We will consider all the representations made today and during the consultation.

Alison Seabeck: On that very point, will the Minister promise today that she will take a meeting of all the south-west MPs, once that consultation is under way and we have had the opportunity to look at the franchise? We will certainly have views on it.

Mrs Villiers: I am happy to give the hon. Lady that undertaking. It will be a good contribution to the decision-making process.

Almost every hon. Member who has spoken has emphasised the economic importance of the Great Western rail network. They included my hon. Friends the Members for South Swindon (Mr Buckland), for North Swindon (Justin Tomlinson), for Plymouth, Sutton and Devonport and for South East Cornwall (Sheryll Murray), and the hon. Member for Plymouth, Moor View (Alison Seabeck). Clearly, it has a crucial role. Rail connectivity supports

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jobs and growth, and is, in particular, vital for the tourism sector, which is such an important part of the economy in the area served by the Great Western franchise. In response to the point made by the hon. Member for Plymouth, Moor View, it would be positive for the Department for Business, Innovation and Skills, the Treasury, local enterprise partnerships and local authorities to be engaged in the important decision in question.

Passenger demand has grown across much of the Great Western network in recent years, as many hon. Members have acknowledged.

Neil Carmichael: I hope that the Minister will take on board the need to modernise the rail track as a whole, so that we can get more trains on the track. That is certainly relevant to connectivity for my constituency, and will make a big difference to the network as a whole.

Mrs Villiers: Improving infrastructure is an important part of the way we are seeking to improve rail services on the Great Western network.

As an example of what I was saying about demand, passenger numbers on the Falmouth to Truro line have doubled since 2006. In the process on which we now are embarking we need, as my hon. Friend the Member for South Swindon said, to learn lessons from the serious mistakes made when the current franchise was let under the previous Government. After a reduced service was specified on some routes, demand increased considerably, once the new franchise became operational. That resulted in controversial crowding, compounded by significant problems with reliability. Following on from that, a number of services were added to the franchise over and above the contracted minimum. The coalition recently agreed to fund a further 54 carriages on the network, including roughly 4,500 extra seats on the Thames valley lines. However, as my hon. Friends have said, demand continues to increase, so that crowding levels are still a live issue for the franchise.

To respond to passenger concerns about crowding and to support the economy, jobs and growth, the Government have prioritised investment in our rail network. Our programme of rail improvements is on a bigger scale than anything since the Victorian era. Some of the most ambitious and important changes will be taking place in the area served by the Great Western franchise. They include the intercity express programme to deliver a new fleet of electric and bi-mode trains and extra capacity; electrification of the lines linking Paddington, Bristol, Cardiff, Oxford and Newbury; upgrades to signalling and train operating systems; provision of an electric suburban fleet; a massive redevelopment of Reading station; Crossrail infrastructure works and rolling stock introduction; and, last but not least, the redoubling of the Swindon-Kemble line. Ultimately those will generate major benefits for passengers and for the economy of the area served by the franchise. However, delivering a programme on that scale is bound to have an impact on services during the construction and delivery phase, so franchise bidders will be expected to present robust proposals for minimising disruption during the upgrade works, with a keen focus on the needs of passengers.

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As several of my hon. Friends have acknowledged, we are reforming rail franchising to give operators greater flexibility to respond to customer demand in a commercial way, but within a framework set by the franchise, which protects key outcomes, key journey opportunities for passengers, taxpayers and the economy. Our starting point in setting the specification for the franchise will be the current level of service rather than the contracted minimum. We also expect the franchise to include requirements on passenger satisfaction, for example in relation to stations, which several hon. Members have called for. As I have said, we propose a 15-year term for the new franchise. We believe that the increased certainty that that will provide will encourage private sector investment in the railways and the sort of long-term thinking called for by my hon. Friends the Members for Gloucester (Richard Graham) and for South Swindon. A longer franchise should also make it easier for the new operators to build the long-term working relationships with Network Rail and other stakeholders, such as local authorities, that are crucial to an efficient and successful railway. We will be asking bidders to consider how they would strengthen the reliability of services and improve stations and trains. Throughout the process, Passenger Focus will have a vital role to play, emphasising the huge importance that the Department places on passenger concerns. We are grateful for the useful input that Passenger Focus has already given us.

My hon. Friends the Members for Gloucester and for Truro and Falmouth and the hon. Member for Plymouth, Moor View, and others, called for faster journey times on the route. Those would in some circumstances require investment in infrastructure. That, of course, would involve a call on the taxpayer. The case for such investment can be strengthened if the wider economic benefits of improved connectivity can be properly understood and analysed. There is obviously a unified view among my hon. Friends about that, and it may be productive for hon. Members to work with local authorities, LEPs and other stakeholders in the south-west, to evaluate more formally the potential benefits of the kind of infrastructure works that would improve journey times, and such things as further electrification, which others have mentioned today. Other relevant issues might be the adoption of the model that has been used successfully in the north, on the northern hub or in relation to east-west rail, with the overall costs and benefits, and the possibility of section 106 contributions to the line, mentioned by my hon. Friend the Member for Chippenham (Duncan Hames). If faster journey times would involve taking out intermediate stops, the concerns of the communities that value those stops would need to be fully considered.

I know how important the sleeper service is in the south-west. We are at too early a stage to be able to announce all the final decisions, but we would expect bidders to consider clearly and carefully the popularity of the service when they were developing their proposals for the train services to run under the franchise. We will also be interested to hear bidders’ and other stakeholders’ proposals on additional electrification. We can see great benefits in western access to Heathrow, and are looking seriously at that in conjunction with our work on High Speed 2. If the Government go ahead with their HS2 plans, the interchange at Old Oak Common would, as my hon. Friend the Member for Truro and Falmouth

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said, provide important new journey opportunities for people outside the south-west.

We fully recognise the concern about rail fares and the pressure they place on family budgets, which is why the Chancellor has secured funding to cancel the proposed RPI plus 3 increase and revert to RPI plus 1 for the January fare increases. However, we recognise that it is vital to provide a longer-term solution, which means getting the cost of running the railways down, so that we can provide better value for money for passengers. We will expect the new operator for the Great Western franchise to develop close working relationships with Network Rail, as they are essential for bringing the costs of the railways down, as Sir Roy McNulty demonstrated.

We are keen to explore the scope for devolving further aspects of rail to local authorities. We plan to publish in the near future a consultation on devolution options for rail services in England. We have been discussing devolution with a range of local authorities including Devon and Cornwall, which have expressed interest. There is plenty of scope to use existing mechanisms to strengthen the input of the community and local authorities in the refranchising proposals.

I welcome the speeches that have been made today. I hope that all hon. Members will take part in the consultation and encourage their constituents to do the same.

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Child Support Payments

11 am

Mr Wayne David (Caerphilly) (Lab): Earlier this year, I was approached by Miss Nicola Richardson of Gilfach, Bargoed, who was concerned about the lack of financial support from her non-resident ex-partner for their two children. My constituent explained to me that her ex-partner did not have to pay any maintenance to the Child Support Agency, as he was a retained, or part-time, fireman, and his income from that work was excluded. The CSA assessment that Miss Richardson received stated that her ex-partner was to pay zero pounds.

Understandably, my constituent thought that to be extremely unfair, and I could think of no logical reason why she should have received such an assessment. I therefore made inquiries to the CSA and was informed that what my constituent told me was accurate. According to paragraph 4(2), schedule 1 of the Child Support (Maintenance Calculations and Special Cases) Regulations 2000,

“any payment made in respect of the performance of duties as…a part-time fireman”

is not included within the calculation of a non-resident parent’s net weekly income.

The CSA informed me that similar exclusions apply for other occupations, including

“members of the auxiliary coastguard in respect of coast rescue activities, persons involved part-time in the manning or launching of a lifeboat, local councillors and members of the territorial or reserved armed forces”.

I was told that the purpose of the exemptions for those occupations is to encourage voluntary public service and to ensure that maintenance calculations can be made efficiently.

The explanation went on to state that, if such earnings were not exempt, the calculation of a non-resident parent’s net weekly income would be dependent on attendance-based earnings for the performance of duties, which could vary from week to week. According to the CSA, that would mean that there was a necessity to recalculate the amount due to be paid weekly. It also stated that that would have a “significant effect” on its ability to keep cases fully up to date, and therefore on its ability to provide

“an acceptable service to the vast majority of our clients”.

I found that to be quite a remarkable reply. To begin with, how can such exemptions, particularly in the case of part-time firefighters, be to encourage voluntary public service? Part-time firefighters are on an annual salary, ranging from £3,622.50 to £15,390. In the case of Miss Richardson’s ex-partner, he has been a part-time fireman for some 12 years, and my guess is that his salary is towards the upper end of that range. The work of part-time firefighters is to be commended, but by any stretch of anyone’s imagination, it is certainly not voluntary.

The other justification of the CSA is basically down to the fact that it finds it too much of an inconvenience to bother to work out a fair payment based on a variable salary. The result is that hard-pressed mothers and their children are being deprived of much needed financial assistance to which they are certainly morally entitled.

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Having been amazed by the regulations and the CSA’s interpretation, which I have no doubt is accurate, I wrote to the Department for Work and Pensions and the Minister responsible, the Under-Secretary of State for Work and Pensions, the hon. Member for Basingstoke (Maria Miller). She confirmed to me that what the CSA indicated was accurate, about which I have no doubt. In a letter to me in August, she stated that

“the law is quite clear on this matter”—

indeed it is. Disappointingly, in response to my question about whether the Government had any intention to review the law, I was informed in no uncertain terms that there are

“currently no plans to change this legislation”.

I hope that she will today have second thoughts.

I hope that I have highlighted an aspect of the CSA regulations that is clearly unfair. Understandably, my constituent feels strongly about the issue. She has organised a local petition—I have a copy of it with me—which has already attracted many hundreds of signatures. The petition makes the essential point that, because of the regulations, children are being denied the support that they need and to which they are surely entitled.

At the end of the day, the issue is not about the efficacy of regulations, but about ensuring that the resident parent has the financial means to enable their children to enjoy a healthy and secure childhood. That is why I strongly believe that it is necessary to have a discussion about it. I recognise the complexity, but let us stand four-square behind the principle of fairness and change the regulations once and for all.

11.6 am

The Parliamentary Under-Secretary of State for Work and Pensions (Maria Miller): It is always a pleasure to serve under your chairmanship, Sir Alan. I congratulate the hon. Member for Caerphilly (Mr David) on securing this debate. He has experienced a problem that many other hon. Members have encountered, and the debate gives us an opportunity to ensure that there is absolute clarity on how the Government will address the special occupation rules that he has drawn to the attention of the House today.

First, it is absolutely important for me—I am sure that I also speak for the hon. Gentleman when I say this—to pay tribute to the vital role played by people in the occupations that he has mentioned. Whether part-time firefighters, lifeboat men, servicemen, our councillors or auxiliary coastguards, among others, they carry out absolutely vital roles at the heart of our communities and with our armed forces; roles that keep our communities moving forward. That group of people—I am sure that he will agree with me—give a great deal to our community and understand the importance of duty and service. A broken child maintenance system is failing them, letting them and many other people down.

When the second child maintenance scheme was established in 2003, it was felt that earnings from such occupations should not be included as income when calculating what child maintenance to pay. That decision was taken to simplify the system. Such simplification proved to be desperately necessary, not least because

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the new IT system introduced in 2003—a specifically designed and built bespoke system—could not cope with the demands made of it.

A great deal has been learned in the intervening eight years about how best to approach computerised databases, and today the Government take an entirely different approach. For example, the new IT system introduced for personal independence payments and the new child maintenance system—the future scheme—will use out-of-the-box solutions; they will be applied to a situation, but have not been developed specifically for that situation. With personal independence payments, we are using an IT solution that is already in use in Canada, Australia, New Zealand and Ireland.

Back in 2003, the new IT system for the Child Support Agency had been built from scratch. There were significant problems—I am sure that the hon. Gentleman will remember them, because he has served in this place longer than I have—from the word go with the coding and build of untried systems. At that time, the payments made to clients from the occupations that we are talking about tended to be relatively small. That is no longer always the case, and I have an enormous amount of sympathy for the hon. Gentleman’s constituent.

Although the current position was established for a number of reasons, I believe that it is unsustainable. No matter how praiseworthy the efforts of those in part-time professions are, they are often parents, and their children must be at the forefront of our minds when we develop such policy. I pay tribute to my colleagues in the Child Maintenance and Enforcement Commission, who work tirelessly to secure money for children from separated families.

The hon. Gentleman will be aware that the current IT system continues to be a source of grave concern, which is why we are launching a new child maintenance scheme next year that will replace the current Child Support Agency schemes and its two IT systems. Hon. Members may also be aware that the second system continues to have significant problems. Some 100,000 cases can no longer be dealt with in the system and must be handled clerically at almost double the cost. In practice, a third IT system must be deployed.

As part of developing the new scheme, I have considered whether non-resident parents should have the income from so-called special occupations taken into account. The effects of the current position can be serious. For example, a non-resident parent, who is a member of the Territorial Army deployed to Afghanistan for a number of months—I am sure that the hon. Gentleman, like me, has constituents who are in that position—and who derives their sole income for this period from their pay as a soldier has a child maintenance liability of nil. That is different from the position of the regular soldiers serving alongside them who continue to be liable to pay maintenance and of their colleagues whose children continue to be part of their current family. The effect is to leave the children of TA soldiers and any others who fall into this category who are non-resident parents and are deployed on operations entirely unsupported for an extended period. Not including this income within the child maintenance calculation is unacceptable. I agree with the hon. Gentleman’s comments and believe that we should change the rules.

For the new child maintenance scheme, we propose to base the liability of such non-resident parents on their total weekly income. By using Her Majesty’s Revenue

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and Customs income data, we will avoid the administrative complexities that arose in the original scheme and provide a fairer system for the children of such parents.

A consultation on the Child Support Maintenance Calculation Regulations 2012 was launched on 1 December 2011 and will run until 23 February 2012. The hon. Gentleman referred to the letter that I wrote to him in August. What I said was correct at the time. I was actively looking at the issue, but as I was unable to bring it to the attention of the House, I was not able to fill him in on the details. I thank him for giving me the opportunity to do so today.

The regulations as drafted would remove the special occupation exemptions. The hon. Gentleman is a trail blazer in this area. We are very like-minded, and I hope that, as a sign of some Christmas spirit in this place, we will find a common understanding and a common approach to this really important issue.

Mr David: I thank the Minister for her comments. I welcome the fact that she has accepted my argument and recognised that there is a huge anomaly that morally needs to be addressed and that will be addressed with the new regulations. However, will those who are on the current system be able to transfer to the new regulations? Will those who currently lose out, and whose children lose out, be able to have the situation addressed under the new system?

Maria Miller: The hon. Gentleman was reading my mind; I was about to move on to that very issue. Let me reiterate, though, that I inherited the anomaly. I commend my colleagues for acting so swiftly that we can introduce regulations to address this matter under the future scheme. I hope that the hon. Gentleman will be able to support the measures in the Welfare Reform Bill, which will support the introduction of the new scheme, including the IT system, and to encourage his constituents and his hon. Friends to make their views known as part of the consultation. None the less, as he rightly says, people face financial problems now. I should certainly like to make such changes to the existing child maintenance scheme, and I have considered doing so in some detail. However, we inherited a situation in which 100,000 cases have fallen out of the system due to its failings and the prohibitive cost to the taxpayer continues to be borne.

To make fuller changes to the existing scheme rules and the underpinning IT systems risks further problems and added costs to a system that already presents the taxpayer with a bill of £450 million per annum. I share the hon. Gentleman’s frustration, but I hope that I can garner his support for the implementation of the new scheme as soon as possible. That is dependent on the enactment of the Welfare Reform Bill.

Ian Paisley (North Antrim) (DUP): I agree that it is important to maintain maturity and consensus on this matter if we are to move forward swiftly. Will the Minister ensure that, whenever the Department addresses these anomalies, proper and appropriate training is given to staff, so that they can take the claimant through the process swiftly and with as few problems as possible?

Maria Miller: I thank the hon. Gentleman for his intervention, which gives me the opportunity to talk a little about the staff at the Child Maintenance and Enforcement Commission. I was in Belfast recently, visiting the arm of the commission that deals with his

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constituents in Northern Ireland and the constituents of a region in England. I was impressed with its capability and its commitment to do a good job for all of our constituents.

The issue lies in the failings of the IT systems, the approaches taken in the past and the complexities of previous systems. As we look to the new scheme, I urge hon. Members to remember that simplicity and replacing the current IT system are critical if we are to effect the sort of changes that the hon. Gentleman advocates.

Mr David: Basically, I understand what the Minister is saying, but it is not a positive message for people such as my constituent who are losing out and whose children are losing out because of the failings of an IT system. It is not of benefit to them to say, “Things will be better in the future with a new IT system and a new scheme, but they will not apply to you.” When MPs get in touch with the CSA, they often find it very helpful. It allocates individuals to specific cases, and quite often individual cases are tremendously complex. It should not be beyond the wit of the Government to ensure that a system is in place that gives special consideration to individuals who lose out at the moment and whose neighbours face similar circumstances, so that they might be okay in the future.

Maria Miller: The hon. Gentleman raises an important point, and we want to ensure that more children benefit from positive financial arrangements. Too often, that is not the case at the moment. Half the children who live in separated families do not have a secure financial arrangement in place. However, more than half the parents within the child maintenance system feel that they could make their own financial arrangements with the right support. So I urge the hon. Gentleman to consider what support he could give to his constituents, so that they can consider making their own financial arrangements. There is no requirement now for anybody to make their financial arrangements through the Child Support Agency or the Child Maintenance and Enforcement Commission, but there is a requirement for people to meet their parental responsibilities and have a financial arrangement in place to support their children.

As I say, more than 50% of people with arrangements within the CSA feel that they could make their own arrangements with the right support, and that is very much at the heart of the approach that we are taking with the new scheme that we will put in place in 2012. The new scheme will address many of the failings that we have discussed today and that hon. Members will have experienced on an ongoing basis. It will be underpinned by a new IT system, which has been tried and tested by using systems in the commercial world. It will use HMRC data to enable parents to get financial support for their children in place, either within the statutory scheme or outside it.

In addition, we will introduce charges for the new scheme, to encourage more people to take responsibility to make the arrangements themselves. That approach is much better not only for the state—in terms of reducing costs—but for the children involved. The application charge, for which there will be an exemption for victims of domestic violence, will provide another vital incentive for people to consider a family-based arrangement before turning to the state for support.

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We will also introduce collection charges and penalty fees if we have to use enforcement action. As I am sure the hon. Gentleman will agree, all too often people appear to feel that paying child maintenance is an optional extra. It absolutely is not—parents have a clear responsibility to make financial provision for their children. We want to promote a real attitude change, which perhaps has not been achieved before, to help to deter parents from failing to meet their responsibilities and to help them to think carefully about taking responsibility themselves.

The scheme will remain heavily subsidised by the taxpayer, and parents on benefits will still have all their maintenance disregarded, so that they keep all their benefits and all their child maintenance. That will help to ensure that more children have the necessary financial support in place.

The hon. Gentleman rightly asks, “Why can’t we do something now?” My concern is that we must ensure that the current system continues to operate, although in a very difficult set of circumstances, until the new scheme can be put in place. I must take the judgment that adding further complexity to the already broken system that I have inherited will not be best for the vast majority of parents. Put quite simply, the current IT system can barely cope at the moment and to add more complexity to it would cause more concern in the future. However, there is nothing stopping the hon. Gentleman’s constituent or, indeed, anybody else who is following the debate today from taking action to ensure that their children receive fair financial support following separation.

With the new scheme, I am talking about a strong package of reform, not for some distant future but for 2012, when we will roll out the scheme for parents and children who are currently within the statutory system. It will address the hon. Gentleman’s concerns; it will be fairer for parents and the taxpayer; and most importantly, it will support children in the right way, with parents taking real responsibility for their children’s welfare regardless of their own adult relationships.

11.23 am

Sitting suspended.

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Rail Services from and to Scotland

[Mr Philip Hollobone in the Chair]

2.30 pm

Mr Philip Hollobone (in the Chair): I welcome Members to our debate this afternoon.

Mark Lazarowicz (Edinburgh North and Leith) (Lab/Co-op): Thank you very much, Mr Hollobone. It is a pleasure to see you in the Chair today. I take this opportunity to extend the compliments of the season to you and other Members, and to members of our staff in the room today.

I am very glad to have this opportunity to raise a number of issues concerning rail services in Scotland. For the most part, rail services within Scotland are a devolved responsibility of the Scottish Government, and I certainly do not wish—and would not be allowed by you, Chair—to deal with matters under that devolved responsibility. However, there are some important aspects of rail in Scotland for which policy or legislation is made at UK level, and I wish to raise those today.

The first issue is the future of cross-border rail services, and perhaps today is a very appropriate time to raise it, given that over the Christmas and new year period many passengers will be using the services to visit family and friends both north and south of the border. At present, the cross-border services fall under the franchise arrangements controlled by the Department for Transport, with its responsibility for services throughout Great Britain. However, those arrangements are now under threat, as a result of proposals put forward by the Scottish Government’s transport agency, Transport Scotland. As part of options for the future of rail services in Scotland, Transport Scotland is

“considering whether services north of Edinburgh should be provided by the Scottish franchisee, with Edinburgh becoming an interchange hub for cross-border services in the east of the country. In this scenario cross-border services would terminate at Edinburgh Waverley, with onward connections being provided by ScotRail.”

As a result of the cross-border services stopping at Edinburgh and Glasgow, there would be no through trains from England to destinations further north, such as Perth, Dundee, Aberdeen and Inverness to name just a few. For that to happen, I understand that the Scottish Government would have to get the agreement of the UK Government to change the franchise arrangements, so today I want to raise my concerns about that possibility, in the hope that the Minister of State will listen to Members and will herself express reservations about the proposal. I also express my concerns today in the hope that Transport Scotland and the Scottish Government will listen.

At present, there are seven trains a day from England to destinations north of Edinburgh and Glasgow—plus the sleeper services, about which I will speak later—which provide through links, not just on the east coast line to London but on the west coast line to the English midlands and the south and south-west of England. Seven trains does not sound like many, but that is perhaps 2,000 plus seats a day, and is equal to perhaps 20 planes or 500 cars. I, and many others in Scotland, and indeed in England, believe that if the proposals result in the termination of cross-border services at Edinburgh and Glasgow, they are a serious mistake.

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The option suggests that there would be an “interchange hub” at Edinburgh, but that is not a good idea. Edinburgh Waverley, as anyone who uses it will know, is a large station with about 20 platforms at the last count, and one could well imagine passengers, particularly the more frail, taking at least 15 minutes to change trains, allowing for time to go through the ticket barriers of the different operators. There is also considerable building and renovation work going on, which is likely to cause extra disruption for years to come. For passengers travelling long distances, who are more likely to have more luggage, having to change trains in Edinburgh would be extremely inconvenient and add to journey times.

Ann McKechin (Glasgow North) (Lab): I congratulate my hon. Friend on raising this important topic. Does he not agree that, given that 26% of the Scottish economy is based in the Aberdeen area, as a result of the oil and gas industry, it would be incredibly short-sighted in terms of not only general social traffic but economic traffic to stop cross-border trains going up to Aberdeen and beyond?

Mark Lazarowicz: Absolutely. As a regular user of east coast trains, sometimes using the services that go through to Aberdeen, I know that they are very well used. I have had feedback from the business community in Edinburgh, speaking not just for Edinburgh but more widely, about the potentially very damaging consequences for Scotland’s economic interests, because of the effect both on business travel and on the wider travel services between important parts of the Scottish and UK economies.

Another feature of Transport Scotland’s proposals that concerns me is the suggestion that having all journeys in Scotland north of the central belt run by one operator—ScotRail—would in some way be an advantage because it would remove other operators. I am not sure that it would be an advantage, because apart from the difficultly of having to change trains, passengers travelling north of Edinburgh would not have the option of using alternative operators if they so wished. Having said that, it is interesting that these Transport Scotland proposals seem to some extent to contradict others it puts forward in the same document. Elsewhere, it suggests that the Scottish franchise could be broken up into two or three franchisees, including one that would run the “economic” day services, presumably the profit-making ones, and another that would run the social services, presumably the loss-making ones. In my view, that would be a retrograde step, but it is probably not an issue to be discussed at length today.

Mr Russell Brown (Dumfries and Galloway) (Lab): I compliment my hon. Friend on securing the debate. In the rural location I represent, there is a deep concern that we will see a central belt locality with lots of passengers and rail services, offering, to all intents and purposes, a first class service, alongside the potential for second class services—I hate to use that term—being offered just on and off in rural localities, and not really meeting the genuine needs of people living there.

Mark Lazarowicz: That is a genuine concern. I obviously do not know the detailed financial arrangements inside ScotRail and its franchise, but there is currently some

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cost subsidy between the different sections of the route, and we could well see a situation in which the economic franchise took all the good routes, with the profits going to the shareholders or the Scottish Government, and the social services suffered, as very much the poor relations. That would certainly be a consequence if that line was followed by Transport Scotland. To be fair, it is only an option, and I do not want to misrepresent it as the preferred option.

The outcome of the changes to cross-border services is pretty clear. Instead of having one through ticket on one through train, passengers could have to change services, wait sometimes in the cold—Edinburgh Waverley is not the warmest station in the world, I regret to say—and have the hassle of negotiating various pricing deals offered by different rail companies as they change trains. More passengers would therefore stop using rail. They would fly or add to traffic on already busy roads, and some tourists might not come at all. They would certainly be less likely to travel north of the central belt to areas where tourism is so important to the local economy. The proposals would not only affect passengers on long-distance cross-border services; there would also be a loss of choice for passengers from places such as Edinburgh to destinations further north, including Dundee and Inverness on the east coast services, and, dare I say it, there would be a loss of competition as well.

The operational arguments for maintaining cross-border services seem overwhelming, and the benefits to passengers are certainly clear. I am concerned that it appears that one of the motivations for the proposed termination of cross-border services at Edinburgh and Glasgow is what can only be described as a narrow financial interest. I quote again from the Transport Scotland report:

“The provision of these services, whilst providing additional capacity, also takes potential passengers and revenue from ScotRail services, and thereby affects the levels of subsidy required from the Scottish Government.”

The first priority should not be whether a few pounds, euros or even Scottish dollars should be saved for the Scottish Government; it should be the needs of passengers. I hope that the Scottish Government and Transport Scotland will recognise that, and the other concerns that I am raising. I urge Transport Scotland and the Scottish Government to keep our cross-border services, and I hope that the UK Department for Transport will make those views known to the Scottish Government.

Many of the arguments against cutting cross-border services also apply to Transport Scotland’s proposals for sleeper services between Scotland and England. In its report, Transport Scotland suggests that all or at least some services be removed from the requirement to operate under the ScotRail franchise and allowed to operate under a separate franchise. The report gives various suggestions about whether that franchise should be supported financially or run commercially only. It also suggests that only services to and from Edinburgh be franchised, leaving other services to be operated on a commercial basis only. Effectively, that would almost certainly mean that they would not be operated.

Leaving aside the fact that removing sleeper services from the ScotRail franchise, thereby jeopardising their future, would be an extremely odd move at a time when the UK and Scottish Governments are considering financing new sleeper stock, if such a cut were made or sleeper services were totally withdrawn, it would be bad

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news for passengers, and particularly bad news for the business and tourist sectors. I spoke last week to people from the Edinburgh business sector who expressed concern that a threat to the Edinburgh sleeper service would damage the business and tourism connectivity of Edinburgh and of Scotland as a whole.

I hope that the Minister shares my concern about both those issues, and I hope that her Government will reflect to the Scottish Government the concerns shown by many in Scotland in business, leisure and local communities, as well as workers in the rail industry. I certainly hope that Transport Scotland will think again.

I emphasise that I am not against change in the ScotRail arrangements or anywhere else, but I am against change so damaging to the travelling public. I would like some imagination from both Governments and from the rail industry in general about how existing service patterns might be improved to provide better connections between Scotland and England and better cross-border services, rather than making it more inconvenient to travel across the border. For example, at a time of big increases in rail travel on day services, could we not consider providing more sleeper services in the UK rather than fewer, perhaps reinstating some of the services cut a few years ago, or even overnight services from Scotland and the north of England to the continent of Europe?

On day travel, is it not time to consider how to improve cross-border services rather than cutting them? On my recent visit to Liverpool for the Labour party conference, due to the non-existence of through services, I was reminded again of the number of changes involved and the difficulty of connections from Edinburgh and Glasgow to that major city. There are also other places in England where through services to Scotland are not what they could be. In my view, we should be considering improving the service rather than cutting it in the way proposed by Transport Scotland. I hope that Transport Scotland and the Department for Transport will consider those thoughts for the future, as they will have to work together on the issues due to their cross-border implications.

I have spent some time referring to and criticising some of the proposals for rail services made by Transport Scotland. There are many others on which I have a view, but I will not mention those that are primarily of devolved concern. There are obvious overlaps between both devolved and reserved responsibilities. I know, for example, that people in Scotland are angry at the increase in fares announced for Scotland, as for the rest of the UK, but that is obviously the responsibility of the Scottish Government and Parliament, so I will not go into it in more detail, although I emphasise that views on the issue are extremely strongly held.

I will comment on one area of future policy that concerns both Transport Scotland and the Department for Transport: high-speed rail. Having so far been critical of Transport Scotland’s proposals, I will now be more positive about some of its recent ones. Indeed, I warmly welcome its recent report, “Fast Track Scotland: Making the Case for High Speed Rail Connections with Scotland”. The report was published earlier this month and resulted in numerous conclusions with broad or all-party support. The first is:

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“Scotland stands united in support of high-speed rail. It is vital that a high-speed rail network be established across the UK to secure its future competitiveness and economic prosperity”,

as well as the competitiveness and economic prosperity of the entire UK.

The report continues:

“The investment case for high-speed rail is strong, but is stronger when Scotland is included.

Scotland supports a high-speed rail strategy which brings Edinburgh and Glasgow closer to London and the UK’s great cities, and which preserves and enhances aviation links with London’s airports for the north of Scotland.

A new high-speed line must be built to Scotland to realise the fullest economic and environmental benefits for the UK.”

I endorse those comments completely. I believe that high-speed rail is important to improve journey times, for environmental reasons and to improve capacity on the rail network as a whole. Transport Scotland’s report presents a powerful case for connecting Scotland with the high-speed rail network. Equally, the report highlights how a failure to connect high-speed routes to services on other lines could damage Scotland’s interests by placing it and cities in the north of England in a relatively worse position, in terms of journey times and rail capacity, than cities linked to the network.

As I have said, it is in the interests of the UK’s high-speed rail network as a whole that Scotland should be part of the network, because of the benefits that it would bring to the business case for the whole network. Business leaders throughout the UK support Scotland’s inclusion in a high-speed rail link.

Ann McKechin: Does my hon. Friend agree that the approach taken by HS2 Action Alliance has been disappointing? It wrote to Members earlier today expressing that an alternative that would save a mere 20 minutes of journey time should be satisfactory. I represent a Glasgow constituency, and he represents an Edinburgh one. Given that the joint economic force of Glasgow and Edinburgh makes them the second largest economy outside London, does he agree that the strength of the case is overwhelming? It is time for those who oppose HS2 to consider properly the economic interests of all parts of the United Kingdom.

Mark Lazarowicz: I agree with my hon. Friend. I understand that the exact route of High Speed 2 is being debated, as are issues such as the right route and speed for a line, at what speed trains could run and whether changes could be made to reflect the environment. I accept all those concerns—I am not saying that one should not—but ultimately, it is not just a question of taking 20 minutes off the time to reach Glasgow and Edinburgh. In any configuration, we are talking about major time savings. By definition, those time savings increase the longer the distance travelled, which is why it is so important to the business case of the whole line that Scotland should be included at an early stage in the planning.

Support for Scotland’s inclusion in the high-speed rail link comes from business leaders throughout the UK. The London chamber of commerce and industry says that

“for HS2 to improve the country’s connectivity and infrastructure capacity, it must reach the whole of the UK. Only then will the expected business and transport benefits be enjoyed by the entire

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country… Consequently, the line should also be planned and thought of in its totality, rather than as independent and isolated sections.”

I absolutely agree.

The Greater Manchester chamber of commerce says:

“Glasgow and Greater Manchester are two of the UK’s largest economies and the third and fourth biggest population centres in the country. Strong economic development within these cities will be essential for countering the economic dominance of London and providing the driver for growth within their respective regions. As such, high-quality links between these centres is essential for developing trade, tourism and expanding the knowledge, opportunities and labour catchment areas for these conurbations… Significantly, though, the benefits of high-speed rail are greater over longer distances, and therefore the time savings between Manchester and Glasgow would be significant enough to help deliver a shift in mode of travel and generate passenger demand on the new rail network.”

That is why I, along with opinion across the political and social spectrums in Scotland and beyond, am extremely concerned by the possibility that serious planning for high-speed rail to Scotland will not even start for many years. If planning for high-speed rail to Scotland is left until later, it could be the 2040s at the earliest before high-speed rail reaches Scotland. Such a long delay after the routes reach the midlands and the north of England would be extremely damaging to the economic interests of Scotland and those parts of the north of England not linked to the route.

To secure the funding to allow high-speed rail to reach Scotland requires choices, and I accept that they may be choices about routes, speeds or the location of sections of routes. Putting together the funding package is still many years off, but I want to emphasise that we do not want to be in a situation where not even the planning has been started. We must ensure that we plan now for Scotland to be part of that high-speed line. Detailed planning of HS2 must be done at this stage, as the report from Transport Scotland and the Scottish Government calls for, and I fully endorse it.

Let me emphasise again that it is in no one’s interest for Scotland to be left at the end of a high-speed line. The Scottish Government have said that they will pay for the Scottish section of such a line. Although their commitment looks a little shaky under closer analysis, I am sure that a future Scottish Government of any political shade would recognise the value contributing to a project of such importance for Scotland. I understand that Scottish Ministers hoped to meet the Minister or her colleagues to discuss the issue. Was any progress made in those discussions? Is there potential for an agreement with the Scottish Government?

I could say much more, and although there is time to do so, it is right to allow the Minister and the Front-Bench spokesman plenty of time to respond to the concerns that I have raised. There are certainly many other rail policy issues at UK level that concern Scotland, including a number of the implications of the McNulty report and some of the proposals in the Transport Scotland report on transferring some of the responsibilities that Network Rail supervises at a British level to a devolved level. They are significant matters, but they are perhaps too technical and lengthy and would require me to divert to another subject at great length.

Maintaining the sleeper and cross-border services and planning for future and better connectivity are important and concern all Scotland. I hope that the

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Minister and the Front-Bench spokesman will say something that recognises the importance of those issues, assures us of a way forward and, as I have indicated, sends a clear message from the House to Transport Scotland that some of its proposals would be extremely damaging to transport interests throughout Scotland.

Mr Philip Hollobone (in the Chair): Before I call the Front-Bench speakers, may I say, after that excellent start, that this is a slow debate? We are taking the scenic route with plenty of time to admire the view. The Opposition spokesman need not trouble himself to rush to the end of his remarks. I call John Woodcock.

2.52 pm

John Woodcock (Barrow and Furness) (Lab/Co-op): Thank you for that sound advice, Mr Hollobone. May I say at length what a pleasure it is to serve under your chairmanship? I congratulate my hon. Friend the Member for Edinburgh North and Leith (Mark Lazarowicz) on securing the debate and on his excellent speech about a critical issue for, of course, Scotland, but also for the economy of the whole United Kingdom. Throughout the debate, it is important that we keep that in mind.

In recent weeks, we have heard concerning noises from the Scottish Government on the future of not only rail services in Scotland, but cross-border services, as my hon. Friend described. Given the franchise renewal timetable—two of the three major cross-border operations are due to be re-let in the next 24 months—this is a timely moment to discuss Government policy on cross-border rail services. He expressed the importance of the subject well.

On a personal level, as a twice-weekly user of the Euston to Glasgow service to return to my constituency, I am very aware of how well used and often overcrowded such services are. Although the train may be overcrowded this evening and a little late, the journey back home to my constituency for Christmas will be made all the sweeter for having had the chance to take part in the debate today, so, again, I thank my hon. Friend and congratulate him on securing this debate on the last afternoon before the Christmas recess.

It is important to talk about the improvements made to both lines into Scotland over the past decade. They were often made at a greater cost than should have been the case, but were improvements nevertheless. Despite the overruns and pain for passengers arising from the west coast main line upgrade, the end product was reduced journey times to Glasgow, with a more reliable service, operated by modern trains. One hundred and six extra Pendolino coaches, which were ordered under the previous Government, will arrive in the UK to provide extra seats on the route, and Lord knows they are needed at peak times.

The number of trains has steadily increased on the east coast route, with a half-hourly service to Edinburgh, which my hon. Friend mentioned, running for much of the day. The major timetable change, announced by the Labour Government last year, cut journey times and reintroduced a Flying Scotsman service, which takes just four hours between the capitals. The CrossCountry and TransPennine Express services into Scotland have benefitted from new rolling stock and increased frequency. Nevertheless, significant shortcomings in cross-border services remain, which is why the Scottish National party Government’s policy to cut Scotland off from the

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rest of the UK is so worrying. As an aside, it is also worrying that no SNP Members are here for a debate that affects the links between Scotland and the rest of the UK and that is directed at the alarming decision their colleagues in Government in Holyrood have brought forward and seem set to plough ahead with.

Even now, overcrowding on some trains limits the capacity for the modal shift that we would like from domestic air travel to rail. Walk-on fares are high and the cheapest deals sell out quickly. Passengers have to endure periods of very poor reliability, leading this week to the Office of Rail Regulation taking enforcement action against Network Rail due to poor performance on those routes. Ministers need to address those concerns when they make decisions on the future of the west and east coast franchises.

The proposals for a 14-year franchise on the west coast do not require extra capacity to be provided before 2026 and Ministers have scaled back the size of the inter-city express programme, designed to provide new trains and extra seats on the east coast. I am afraid that all that points to lack of clarity and ambition for cross-border services over the next couple of decades.

As ever, my hon. Friend led the charge on high-speed rail to Scotland. He made his case strongly, as he always does. It is important that we are clear that Scotland will benefit if we secure the scheme that is on the table, but still, unfortunately, remains in doubt—that is, a new high-speed line right the way through to Manchester and Leeds. With through-running on to the existing network, that will reduce journey times from London to Edinburgh and Glasgow by at least an hour. By bypassing the most congested parts of the east and west coast main lines, HS2 can allow for a step change in the frequency of cross-border services, which I am sure everyone in today’s debate would want to see. That is why we are continuing to urge the Government to introduce a single Bill on the full route to the north of England, rather than simply for the route to Birmingham, as is currently planned.

I know that the Minister will be particularly grateful for potentially having considerable time to wind up today and deal with where she is on that issue at length. She can perhaps give us a preview of the forthcoming announcement on HS2, which we all expect and hope will be made early in January. Ministers claim to be committed to the fully shaped network, but we need more than words. As mentioned on the issue of going all the way up to Scotland—it is the same for going up to the north of England—the principle remains that the business case for high-speed rail is far stronger if it extends to Manchester and Leeds. The benefits that that would bring to Scotland are a key part of that case.

However, it is understandable that my hon. Friend has focused his concern today on the “Rail 2014” document produced by Transport Scotland. As he said, obviously, the bulk of its contents deals with internal Scottish services. The threat of having fewer trains calling at fewer stations is certainly worrying for the constituents of my hon. Friends here today.

Mark Lazarowicz: I wanted to intervene on my hon. Friend before he moved off the subject of high-speed rail. Will he consider again the fact that it is of absolute

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importance that detailed planning for HS2 going to Scotland takes place at this stage, rather than waiting until the second hybrid Bill is going through the House? If we do that, bluntly, the chances are that high-speed rail will not go to Scotland for two or three decades. That would not be good enough.

John Woodcock: I hear—as do all hon. Members—the case that my hon. Friend has consistently made on that. The Government’s commitment to take the line only up to Birmingham and to legislate for that is alarming. Certainly, there is an opportunity here. Without delaying the building work and the commencement of construction by a single day, the Minister could easily create a single hybrid Bill that would legislate to take high-speed rail all the way up to Manchester and Leeds. She may want to say what the timetable implications are for the suggestion that my hon. Friend has made.

The cross-border services set out in the consultation document are remarkable. It is astonishing that a Scottish Government who claim to represent the whole of Scotland are suggesting the removal of through-services from London and other parts of England to towns and cities north of Edinburgh. That will force passengers to change at Edinburgh Waverley, with all the particular difficulties that my hon. Friend has laid out so well.

Under those plans, the roll-call of Scottish places that would lose their direct London trains is damning: Inverness, Dundee, Perth, Stirling, Falkirk, Kirkcaldy, Montrose, Arbroath, Aviemore, Pitlochry and Stonehaven. My hon. Friend the Member for Dumfries and Galloway (Mr Brown) has rightly raised concerns about the possible loss of the Glasgow to Carlisle through-service. That concern would be felt in my county of Cumbria to the same extent as it would in his constituency and beyond. By my count, under the proposals that the Scottish SNP Government have introduced, just five locations in Scotland would retain long-distance services into England.

As has been mentioned, those services are important to businesses across the north of Scotland—as much to the oil industry in Aberdeen as, for example, to bed and breakfasts in the Cairngorms. The direct service is appreciated by older people, by those with limited mobility and, indeed, by families with young children or heavy luggage. I recognise that this is outside the confines of the debate, but if we could have a direct service through to my constituency of Barrow and Furness, the prospect of being able to negotiate the buggy and a week’s worth of luggage would be greatly improved for many more people than me.

Returning to Scotland, obviously the content of the consultation is the responsibility of Scottish Ministers, who seem dangerously relaxed about restricting key transport links between Scotland and the rest of the UK. UK Ministers also have a responsibility. We welcome the Chancellor’s decision announced in the autumn statement to offer match funding to the Scottish Government to fund a replacement fleet of vehicles for the threatened sleeper services. In winding up, I hope that the Minister can tell us whether the Scottish Government have responded to that offer, whether she has made any direct representations on that issue and how the matter is progressing. Beyond that, can she let hon. Members know whether the UK Government will be responding to the Transport Scotland consultation?

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Mark Lazarowicz: Would it not be an irony if new sleeper stock were purchased but there were no sleeper services to operate as a result of a change in the franchise? My hon. Friend might recall—although possibly not—that, a few years ago, trains were going to provide direct services from Scotland and the English regions through to the continent of Europe. Those trains were never used for that purpose and, for a while, they ended up on the London to Leeds services. I do not know what has happened to them now, but would it not be an irony if money were spent—£100 million—on new sleeper rolling stock that was not actually used for that purpose?

John Woodcock: It would be more than an irony; it would be a travesty. My hon. Friend is right to emphasise the continued importance of sleeper services. Although airports have expanded and capacity has increased, the sleeper service remains a hugely important way of connecting London with Edinburgh, Glasgow and beyond. We need to find a way to retain it, and it is alarming that the proposals will potentially withdraw it. Will the Minister therefore answer our questions about the sleeper services? Will she also tell us whether the through-trains to Aberdeen and Inverness will be protected when Ministers publish the requirements for the east coast franchise? Will she reaffirm the Government’s commitment to the bi-mode part of the inter-city express programme, which is key to allowing through-running to continue?

Ultimately, Scots and citizens in all parts of the UK will lose out if the SNP’s great railway robbery goes ahead. Over the years, SNP Members, who are not here today, have often been known as the Tories’ little helpers. It is now time for the Conservatives and their Liberal Democrat friends in the Government to show that they will not let themselves be the SNP’s little helpers as it pursues its agenda of cutting Scotland off from the rest of the UK.

3.11 pm

The Minister of State, Department for Transport (Mrs Theresa Villiers): I, too, congratulate the hon. Member for Edinburgh North and Leith (Mark Lazarowicz) on securing this debate on the last day before the recess. Let me also say how much I always enjoy serving under your chairmanship, Mr Hollobone. You wisely advised us to take our time and look in some depth at the important issues under consideration.

The goal the coalition Government set themselves was to tackle the deficit we inherited and to build a solid foundation for economic recovery and growth. That means not only getting the best value for every pound of taxpayers’ money spent, but prioritising the spending that can best support growth, jobs and prosperity. That is why transport, including rail, came out of the spending review in a much stronger position than most people expected, and why the Chancellor gave the go-ahead for a further list of road and rail improvements in his recent autumn statement.