28 Feb 2012 : Column 172

Eradication of Slavery (UK Company Supply Chains)

Motion for leave to bring in a Bill (Standing Order No. 23 )

4.27 pm

Fiona Mactaggart (Slough) (Lab): I beg to move,

That leave be given to bring in a Bill to require retailers and manufacturers in the UK to make annual statements of measures taken by them to eradicate slavery and human trafficking and exploitation from their direct supply chains; to require large retailers and manufacturers to provide customers with information about measures taken by them to eliminate slavery and human trafficking and exploitation; to provide victims of slavery with necessary protections and rights; and for connected purposes.

This House is rightly proud of its contribution to the abolition of the transatlantic slave trade 200 years ago, but a lesson that we need to learn is that we cannot be complacent. It is shocking that in the last quarter of a century the existence of modern forms of slavery has actually grown. From child labourers on west African cocoa farms to Chinese prisoners being exported to the Maldives to build infrastructure projects, slavery is thriving around the world. As consumers, we enjoy the cheap products that forced labour has helped to deliver. The aim of my Bill, which is modelled on legislation already in force in California, is to ensure that consumers know when forced labour has been used to make a product that they buy. Armed with that knowledge, they might well choose an alternative.

The Bill would require large UK manufacturers and retailers to report on the following issues in their annual reports and on their websites. They would have to report on how they verified product supply chains to evaluate and address the risks of human trafficking and slave labour. They would have to describe the audits that they conducted to ensure that suppliers adhered to company standards. They would need to certify, through direct suppliers, that the materials used to make a product were from countries that did not engage in slavery and human trafficking and that complied with anti-trafficking laws. They would have to describe their procedures to ensure that employees and contractors maintained company standards on human trafficking and slavery, and the training on human trafficking that was provided to personnel working in supply chain management, focusing on where the risk was greatest. In addition, my Bill would place a duty on a company that uncovered trafficking or slavery within its supply chain to provide remediation to victims. This could include education for children, or refuge or payment to adult victims.

Clearly, such a range of responsibilities would be a burden on a smaller company, so the reporting requirements of the Bill would apply only to companies that generated sales worldwide of at least £500 million. That stretches from such companies as Ocado to Tesco via brands such as L’Oréal and Imperial Tobacco, and it excludes smaller companies. The burden is not fundamentally a regulatory one; it is a responsibility to report. My belief is that, confronted with knowledge of such a practice within their supply chain, most successful companies would want to drive it out. Customers would also want to choose slavery-free products.

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So what do I mean by slavery and trafficking? In 1930, the International Labour Organisation convention concerning forced and compulsory labour defined slavery in a way that included

“all work or service which is exacted from any person under the menace of any penalty and for which the said person has not offered himself voluntarily.”

This century, the UN protocol on trafficking in persons defines trafficking as

“the recruitment…(etc) of persons, by means of the threat or use of force or other forms of coercion…(etc) to achieve the consent of a person having control over another person, for the purpose of exploitation. Exploitation shall include, at a minimum, the exploitation of the prostitution of others or other forms of sexual exploitation, forced labour or services, slavery or practices similar to slavery, servitude or the removal of organs…Most simply, slavery covers anyone who is forced to work without pay, being economically exploited and unable to walk away.”

It is an archaic and demeaning practice, yet as the campaign group Slavery Footprint, which can provide people with a phone app to count how many slaves are working for them, points out, people are made vulnerable to this kind of exploitation by high rates of unemployment, poverty, crime, discrimination, corruption, political conflict or cultural acceptance of practices.

If we all agree that slavery and trafficking are wrong, why has more not been done? I want to recognise that some companies have done good work to eliminate slavery. Let us take chocolate, for instance. In 2001, the global cocoa industry committed to ending child trafficking in its supply chains through the US-based Harkin-Engel protocol, but it worked too slowly. By 2009, it was estimated that there were still more than 1.8 million children working in the cocoa industry, many of them trafficked.

Progress is now being made. As the MP representing Mars chocolate factory in Slough, I am proud to say that in 2009 it committed to certify independently its entire cocoa supply by 2020. Mars launched the first Rainforest Alliance-certified chocolate bar in the UK —Galaxy—in 2010, and will go Fairtrade with Maltesers

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this summer. I gather from its competitor Nestlé that KitKat is also being certified by UTZ.

John Lewis Partnership is an example of a retail company that is acting. It has explicit requirements in its suppliers’ code of practice, which is available on its website, to prevent the employment of children and the use of forced labour. Many smaller UK companies that supply large companies based in California are already being required to report as part of their supply chain audit.

Not all the Bill’s sponsors, who include 11 Members from six different parties, will share my concern about abuse of the process whereby unemployed people can get work experience in retail stores here in Britain. This can be a great chance to learn about the world of work, but in some cases in my constituency people have received no training, have been used to substitute for paid labour and face withdrawal of benefits if they discontinue the placement after the first week. The Bill was not designed to address that problem. Indeed, when I conceived it, I thought its application to UK-based companies would not extend beyond parts of the agriculture and food industries that were already regulated by the Gangmasters Licensing Authority. However, if we are not vigilant, exploitation will not be confined to the poorer countries where it thrives most. In enabling public information to be provided, the Bill aims to use the power of the purchaser to prevent slavery and exploitation.

I hope that by raising the issue and debating it, we shall accelerate progress towards the eradication of slavery from the supply chains of every major UK company before the decade is out.

Question put and agreed to.


That Fiona Mactaggart, Mr Richard Bacon, Hugh Bayley, Tom Brake, Michael Connarty, Mark Durkan, Jane Ellison, Dr Julian Lewis, Caroline Lucas, Siobhain McDonagh, Jim Shannon and Jim Sheridan present the Bill.

Fiona Mactaggart accordingly presented the Bill.

Bill read the First time; to be read a Second time on Friday 23 March, and to be printed (Bill 311).

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Estimates Day

[5th Allotted Day]

Vote on Account 2012-13

Department for Transport

Transport and the Economy

[Relevant Documents: The Third Report from the Transport Committee, on Transport and the Economy, HC 473, and the Government response, HC 962; and the Fifteenth Report from the Transport Committee, on Counting the cost: financial scrutiny of the Department for Transport 2011-12, HC 1560.]

Motion made, and Question proposed,

That, for the year ending with 31 March 2013, for expenditure by the Department for Transport—

(1) resources, not exceeding £3,413,771,000, be authorised, on account, for use for current purposes as set out in HC 1756,

(2) resources, not exceeding £3,478,411,000, be authorised, on account, for use for capital purposes as so set out, and

(3) a sum, not exceeding £5,850,719,000, be granted to Her Majesty to be issued by the Treasury out of the Consolidated Fund, on account, and applied for expenditure on the use of resources authorised by Parliament.—(Mr Francois.)

4.36 pm

Mrs Louise Ellman (Liverpool, Riverside) (Lab/Co-op): I am pleased to have the opportunity to launch a debate on two reports from the Transport Committee about expenditure by the Department for Transport. The first, “Transport and the economy”, considered how spending on transport could boost economic growth, and was published last March. The second, “Counting the cost”, was published only last week. That report follows up important aspects of our earlier work and comments on changes to departmental expenditure plans, particularly the new transport projects announced by the Chancellor of the Exchequer in the autumn.

I should begin by putting the Department’s expenditure into context. In 2010-11 the Department’s budget was £12.8 billion, which was split between capital projects and ongoing resources spending. As a result of the spending review, that budget was due to decrease by 15% in real terms by 2015. Resource spending, covering items such as local authority grants and the bus service operators’ grant bus subsidy scheme, was cut by 21%.

Derek Twigg (Halton) (Lab): I congratulate my hon. Friend. During the last two or three months, I have observed an increasing number of complaints from constituents whose bus services are being cut in Runcorn and Widnes. Has the Committee made any assessment of the wider impact on bus services throughout the country?

Mrs Ellman: The Committee investigated the impact of spending cuts on bus services, and found that cuts had been made in more than 70% of transport authorities. My hon. Friend may be interested to know that it is currently re-examining the issue.

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The cut in the bus subsidy scheme was larger than the 11% cut in capital spending. The situation has changed a little following the autumn statement, with some extra money provided for capital projects

The fact that most of the Department’s budget is spent by external agencies, specifically Network Rail, Transport for London and local authorities, makes it more difficult for the Department to have detailed control over those areas. However, the Department was generally regarded as having emerged relatively well from the spending review, despite the significant cut in its budget. I welcome the Government’s statement that they believe that spending on transport infrastructure can help to boost the economy.

It is important to recognise that congestion on the road, rail and air networks remains a major constraint on connectivity and growth. There is clear evidence that relieving congestion by providing new capacity helps to increase productivity and promotes economic development. It is also important to note that congestion is not the only indication of the need for transport investment, particularly where regeneration is required and disparities are evident.

The last major Government study of the relationship between transport and economic growth was the Eddington report, commissioned by the previous Administration. It showed that transport is necessary for economic growth, but of itself is not sufficient. To be effective, transport and economic development must go hand in hand. Building transport links to Canary Wharf regenerated the area because that was linked with an economic strategy. It is not clear that the Government appreciate the significance of this point made strongly in our report.

Our report expressed concern that the abolition of regional structures may lead to the absence of economic development strategies required to maximise the potential of transport investment across local authority boundaries as well as making it more difficult to prioritise transport projects of wider significance. The Department has encouraged the local enterprise partnerships to fill that gap and it is now suggesting that transport funding could be devolved to groups of local authorities and LEPs. How will this work in practice, however? This new approach to regional planning might work well in some areas but could struggle to take off in others, and there will be parts of the country which lack a strong voice or which fall between two strong regional centres and are overlooked by both.

The Department did not identify the issues it is seeking to tackle through its spending on transport. For example, the Government state that they want to “rebalance the economy”. That can mean a number of different policies, perhaps including more private sector employment, reducing disparities between regions, or reducing reliance on the banking sector and encouraging manufacturing. How are the decisions on transport spending related to these objectives and what assessment takes place to identify which transport modes are most appropriate to deliver them? How is the balance of spending between road and rail determined? Has any assessment been made of the significance of the absence of an aviation policy on economic activity generated by international connectivity? The answers to those questions are not clear. That is because the Department does not have an explicit transport strategy and lacks a coherent framework for deciding which transport schemes to prioritise.

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I must note, however, that some progress is being made. Rail and aviation policy papers are due very soon and the Committee is looking forward to scrutinising them. There has been an important review of the Highways Agency, a national policy statement regarding ports has been agreed, and a policy statement for national networks is awaited. Will the Minister assure us that we will soon see a Government strategy for transport? That is greatly needed and has been long awaited.

The Committee considered the appraisal that is undertaken of transport projects. There is sometimes too much focus on cost-benefit analysis: not all the costs and benefits of a project can be monetised. For example, the wider economic benefits of a project or its environmental impacts are often excluded. It is also often forgotten that the economic appraisal is just one aspect of a more complex appraisal process based on five areas, including strategic fit and project affordability. Unless an overall strategy is identified, it is not possible to assess the strategic fit of any individual investment. Greater transparency in decision making is important. No doubt we will debate High Speed 2 in more detail on another occasion, but it is notable that although a huge amount of material about the project has been published, no information about how it is to be financed has been made public.

In respect of smaller schemes, there is often very little published information about the strategic fit or how they are to be funded. The new projects announced in the autumn statement seem to have been funded on the basis that they were ready to proceed. It is unclear whether they are necessarily the investments that offer the best value for money or that will meet transport objectives. The Department contributes significantly to two cross-departmental funds—the regional growth fund and the growing places fund—but no information is available on where the Department’s financial contributions have been invested or to what effect.

Strategic fit should include consideration of how a scheme contributes to rebalancing the economy. The major investment that has taken place in transport infrastructure in London and the south-east is clearly necessary, but transport investment across the UK is required. Interestingly, £15 billion will be invested in Crossrail, about £5 billion of it directly from Government funds, and £5.5 billion will be invested in Thameslink, while a reappraisal is taking place on whether half a billion pounds should be invested in The Northern Way, improving rail services right across the north.

The new transport spending announced in the autumn statement is welcome, but the analysis of the regional breakdown published by the Institute for Public Policy Research North raises concerns. It found that 84% of planned new infrastructure spending would be in London and the south-east, compared with just 6% in northern England. That works out at an average spend per head of £2,731 in London compared with just £5 in the north-east. The Passenger Transport Executive Group has produced similar information showing that transport spending is more than twice as much per head in London and the south-east than it is in Yorkshire and Humberside, the west midlands and the north-east. That imbalance is a matter of concern.

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David Mowat (Warrington South) (Con): The hon. Lady raises an important point about the discrepancy in the level of spend in London and the south-east, which occurred under the previous Government, as the Select Committee report made clear, and is apparently continuing under this Government, as the IPPR figures that she cited made clear. Did she and her Committee consider why the methodology by which transportation schemes are assessed continues to drive an answer that skews the cash so much towards one small part of our country?

Mrs Ellman: I thank the hon. Gentleman for his comments. The imbalance to which he refers dates back many years and decades, spanning many Governments. The Committee did examine the issue and has stated, in recognition of it, that congestion should not be the only factor taken into account when deciding where investment should be made. The importance of economic development and the potential of transport investment in relation to that should be recognised too. The Committee made a specific recommendation on this in its most recent report, stating that the Department should publish an annual analysis of its “regional spend” and publish information about the “regional impact” of its announcements.

More clarity is required on the information published generally by the Department about its spending decisions. When the Department’s budget was cut after the 2010 election, details of which specific items of expenditure were reduced were not published until a parliamentary question was tabled requesting that information. The Transport Committee also discovered that the Department had underspent on its 2010-11 budget to the tune of £1 billion and had returned £500 million to the Treasury. The underspend was far greater than the budget cut made during the year and it was larger than the cuts to bus subsidies, which have caused so many difficulties to bus users across the country. Funding made available for transport should be used for transport and should not be returned to the Treasury. I hope that we will all be able to have more confidence in the Department’s budgeting in the future.

Most rail projects are agreed as part of a five-yearly control period process. We are currently waiting for the Government to set out schemes they would like Network Rail to take forward during the 2014 to 2019 period, and to identify the funds that will be available. This approach has helped to protect rail from indiscriminate budget cuts at the time of the spending review. The Chancellor’s autumn statement included support for some rail schemes, such as the new Oxford to Bedford line. The Committee has asked the Minister to make it clear whether those schemes are additional to the projects that will be announced as part of the normal funding process or are simply being brought forward for slightly earlier implementation. There is a need for much more clarity when announcements are made on whether the schemes are genuinely additional to those that have already been agreed or whether they are agreed schemes being brought forward at an earlier date.

The National Audit Office has recently suggested that the Government should have a mechanism to reopen control period settlements in order to have more flexibility to make cuts, if necessary. I oppose that suggestion. The arrangements for rail have helped to provide a relatively

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transparent and stable way of investing, which is necessarily medium and long-term, but would be undermined if the Department could reopen earlier settlements.

The recent strategic review of the Highways Authority has recommended that a similar five-yearly funding settlement for road projects should be introduced, and it has been suggested that that could lead to a more efficient procurement and supply chain, delivering significant savings. That is an interesting suggestion that I am sure my Committee will want to examine in due course.

Government expenditure is essential to political decisions, particularly during a time of austerity. The Transport Committee will continue to focus on financial issues and has specific plans to examine the cost of the railway when the Government’s response to the McNulty report is finally published. I look forward to hearing hon. Members’ views today and urge the Minister to support our key recommendations.

4.51 pm

Stephen Hammond (Wimbledon) (Con): It is a great honour to follow the Chair of the Select Committee, the hon. Member for Liverpool, Riverside (Mrs Ellman).

I want to comment principally on the “Transport and the Economy” report. The report recognises, of course, that for many years transport was like Cinderella, as it rarely came to the fore and was not regarded as one of the key parts of Government policy. That was true for many years, but there has been a sea change and there is recognition both in the report and in the actions of the previous Government and this Government that the performance of an economy can be directly related to transport.

Transport can undoubtedly boost growth and increase competitiveness, and one of the best policy interventions a Government can make is to ensure that the infrastructure allows industry to thrive. Some of the infrastructure not only benefits industry but improves the quality of life of a number of our citizens, although clearly it can be provided in a number of ways that differ not only physically but financially. Efficient infrastructure will allow efficient and cost-effective movement around national, regional, sub-regional and local networks—I think that that is implicitly recognised in the report. The fact that transport can boost the economy—the report questions its efficacy in some areas, which I wish to discuss later—is also self-evident.

Any report that links transport and the economy is welcome, but having read both the report and the Government’s response and having listened very carefully to the hon. Member for Liverpool, Riverside, I would like to address one or two areas of slight concern and some surprise. For instance, as the hon. Lady conceded, we are discussing this report some time after its publication and so a number of its explicit recommendations have, to the Government’s credit, been covered in a number of ways. Indeed, it seemed to me that the Government were already covering a number of the report’s recommendations at the time.

Let me pick out recommendation 5 as an example. It states:

“The Government must explain the nature of the economic solutions that it is seeking to deliver through transport spending and how the schemes that it is supporting will achieve these aims.”

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By the time the report had been published, however, the Government had already set out those things through their transport business case. They have also set out quite clearly in their business plan some of their objectives for transport spending, as well as a vision for a transport system that is an engine for economic growth, and they have attempted to provide a greener, cleaner and fairer solution for our communities.

Moreover, during the previous Government's period in office, many of us on both sides of the House recognised that the formula that the Department for Transport was using to analyse a number of its schemes beyond the basic benefit-cost ratio, NATA—the new approach to appraisal—had a number of deficiencies. We should recognise that the Government have set out a more embracing framework for analysing infrastructure spending. Clearly, there are the four areas to consider: the economic case; whether there is commercial viability; whether a scheme is financially affordable; and, perhaps most importantly, whether a scheme is achievable. That sort of framework, beyond what was previously in place, should provide a greater degree of rigour, for there is now more than one test. There are not only the tests in NATA or the benefit-cost ratio but a number of tests which, added together, will give a transparent and more rigorous approach to the analysis of economic transport investment. I hope that such an approach will stay in place for some time, because one of the problems with transport investment has been that for an awfully long period in this country’s history there was complete inconsistency in approaches to what a scheme could deliver. I support what the Minister has put in place, and I hope he will ensure that it is enshrined and embedded for a long period.

I was somewhat surprised at the report’s conclusions about regional strategies and the removal of regional strategic development and development agencies. I listened very carefully to the speech of the hon. Member for Liverpool, Riverside and I almost intervened, but as I hoped I would have the chance of catching your eye, Madam Deputy Speaker, I saved my remarks. I listened to the hon. Lady’s comments about what regional development agencies were doing for transport spending. However, I think the previous Transport Committee concluded in one of its reports—I forget which one—as did commentators up and down the country, that the variability among what RDAs delivered regarding transport was vast. It is fair to say that what the regional development agency did in the north-west in some of the delivery and spending on transport projects was well appreciated and supported. However, in other parts of the country, particularly the south-west, the RDA was felt to be failing almost everybody it attempted to help.

Angela Smith (Penistone and Stocksbridge) (Lab): Does the hon. Gentleman acknowledge that the arguments and strategies developed by The Northern Way, which brought together three RDAs in the north of England, made a huge contribution to the development of the High Speed 2 project and the northern hub?

Stephen Hammond: Indeed I do, and I thank the hon. Lady for making that point because it helps me to make my next point. One thing that this Government have recognised is that, although there was some mix of RDAs, the reality is that a differing of approach in different areas will be the solution.

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I also think it is quite clear that the report has prejudged the efficacy of local enterprise partnerships. It seems to me that all the initial evidence, anecdotal though it is because they have been in place for so short a time, shows that they are taking their responsibilities towards transport seriously.

Mrs Ellman: I thank the hon. Gentleman for his comments. The report reflected the evidence that was given to the Committee. In taking this further, the Prime Minister and the then Secretary of State recognised the potential gap that would be caused by the removal of the previous regional structures. Indeed, efforts are being made to replace them through other means, but the comprehensive picture and the total results of the changes are as yet unclear.

Stephen Hammond: Indeed, but the previous solution was a template solution, a one-size-fits-all solution, a “this is the way we must do it” solution, which did not necessarily reflect the economic realities. As the hon. Member for Penistone and Stocksbridge (Angela Smith) pointed out, in the north of England it was not one regional development agency, but a collaboration of three. As I observed earlier, in certain parts of the country structures well below the regional level developed and delivered more efficient transport solutions.

I hope that in reading the report the Minister will not be deflected from the idea that solutions of differing sizes will fit different parts of the country, and that LEPs have been in place for a relatively short time. Just as regional development agencies were able to collaborate and co-operate, there is little doubt that LEPs will be able to do the same. It is also true that in certain parts of the country integrated transport authorities and passenger transport authorities will provide the lead in regional structures. The clear message must be that there are differing appropriate sizes and structures.

David Mowat: I agree that the jury is out on LEPs and that the RDAs were not a panacea in this area, but the real point is that neither the RDAs nor the LEPs can compete with the velocity of spending which is so skewed away from the regions and towards London and the south-east. For example, when the Chancellor announces £30 billion of spend, of which 80% was in London, that dwarfs the amount available to the RDAs or the LEPs. The real issue is how we fix that problem, rather than tinkering with the LEPs, which I hope, as I am sure does my hon. Friend, will work in time.

Stephen Hammond: I certainly agree with the latter point. It is beyond the scope of my comments this afternoon to go into the differing amounts of regional money. I accept that there clearly is some imbalance in subsidy between varying regions of the country. It is important to analyse what that can deliver and its efficacy. It is interesting to speculate what Crossrail might bring to London in future, as opposed to what the northern hub might bring to the north. I suspect that the benefits of the northern hub might be greater than those of Crossrail. We will wait and see. I am sure the Minister and the DFT will continue to reflect on that.

As a practitioner of the dark art of economics, I know that different economists will always have differing views on everything. Reading the report, I was struck

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by the comments of the former chief economist at the DFT. Although those may have been made only in response to the question that he was asked, it seemed to me to miss out quite a lot when he said that if one looks at the history of the British economy, it is clear

“how little the underlying rate of economic growth has varied.”

He went on to add that transport had done very little to affect the overall growth rate of the British economy. That seemed to miss out the fact that we have had wildly varying periods across history.

The witness's analysis went back almost 200 years. Over that time, we have had wildly differing levels of infrastructure investment, and there have been periods when the growth rate of the UK economy has been well in excess of the 2% that he mentioned. His analysis also failed to consider the impact of under-investment, which is a well known phenomenon, how that would have dragged down the underlying potential growth rate of the economy even in a period when investment had resumed, and the potential growth rate had there been consistent investment. Although the analysis that Mr Riley presented to the Committee may or may not be valid, it seems to me that it falls foul of the law of averages. I think that the analysis should look at the potential for economic growth with a consistent approach to investment.

Richard Harrington (Watford) (Con): Having listened carefully to my hon. Friend’s argument and seen some of the evidence that was given to the Committee, it seems to me that, although it could be argued that investment in transport might not be such a direct factor in economic growth, we must also consider what would happen if we did not make that investment and this country fell further behind, which I think would lead to economic shrinkage.

Stephen Hammond: I thank my hon. Friend, who more than eloquently makes the absolutely correct point—the final point in my analysis of the economic situation—about the economic analysis presented by Mr Riley.

One of the other learned gentlemen who gave evidence, Professor Goodwin, spoke of the potential for investment not to be transformational, but to be strategic—I am not sure whether he was playing with semantics. He did not like the word “transformational” but said that there was an element of strategy—I think “strategic” is the word he used. He is right that there has been a continued over-egging of the ability of certain single projects to produce the sort of result that some people hope for.

However, if we look at the sheer size of certain schemes and the investment that this and previous Governments have made that complements and adds to what is already in place, and/or if we look at the smarter changes and smarter choices in transport packages, we will see that there is a real chance for transport and infrastructure investment to be transformational. I suspect that some of the moves on work travel packages, which aim to increase access to work, and some of the major electrification projects, which are combined with other minor schemes in parts of the south-west, will in five or six years’ time be considered transformational. In that regard, the evidence given to the Committee probably fails to recognise transport’s ability to be transformational and, more importantly, to enable economic growth.

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Moreover, the point that neither of those two learned gentlemen discussed—this is where I disagree with the analysis of the hon. Member for Liverpool, Riverside—is that if transport is part of a cluster of other investments, including increases in education, access to work, economic development zones and others, its ability to contribute to the potential for economic growth is far in excess of what that would have been had the investment been made on its own. A number of people will have made a better analysis of the cluster theory than I have, but that is broadly what it says. Yet again, if transport is combined with other Government policies, its ability to have a significant impact should not be underestimated.

I will finish with a few other remarks. I warmly welcome and support the conclusion that using transport to support and stimulate the economy and to attempt to reduce regional economic disparities is surely right. The test of the Government in that regard must be whether they are showing any understanding of those challenges. In a time when the key overriding economic priority must be to reduce the economic deficit and ensure that the public finances are put on a more stable profile, this Government are undertaking a number of measures which recognise those challenges and provide economic support in relation to it. We have seen that, significantly, through the Minister’s sponsorship of several local transport plans and investment programmes, and they are having on a small scale quite a huge impact on bus routes, local transport—in terms of local rail—and other issues.

Equally, the support for major projects throughout the regions, such as the northern hub, which has been mentioned, the electrification of the south-west main line and the investment in the east coast main line over the past 10 years, strikes me as sending a clear message that this Government recognise the need to maintain transport infrastructure spend.

As the Chairman of the Transport Committee pointed out, the Department for Transport has done relatively well from the overall comprehensive spending review debate, and that represents the Government’s understanding of the need for and importance of transport infrastructure.

I have spoken principally about rail in my last few remarks, but it is clear also that we neglect at our peril the need to maintain and upgrade our roads, and some smaller road schemes will have a bigger impact than some major, strategic ones, so the £3 billion that the Government are putting into local road schemes over four years is likely to have a positive impact on local, regional and overall economic growth.

I welcome the report, which has sponsored a debate about transport and the economy. I welcome also the Government having evidenced by their actions their understanding of the need for infrastructure in order to support economic growth and the quality of life of our citizens. I am sure that the Minister, in his winding-up remarks, will say that this is not just the start but a continuing policy of the Government.

5.12 pm

Phil Wilson (Sedgefield) (Lab): I want to take this opportunity to raise the issue of declining rural bus services, especially in County Durham and in Sedgefield.

County Durham is a rural area and home to many villages, most of which had a colliery at one time. When the collieries were open, people did not have very far to

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travel, but now that the collieries have closed many people find that they have to travel a long way, and many miles, to get to work, so a reliable public bus service is a necessity.

The bus service is required not only for work, but by young people who want to go to college; by the elderly, who might want to go to hospital or to a medical appointment; by the same groups of people to see friends and family; especially by young people just starting out on their career, who may not have the money to buy a car and need the bus to get to work; and by people on low incomes. We need to think also of the unemployed, who might see a job in the newspaper or in the jobcentre that they would love to do, but who know that they cannot apply for it because there is no bus service to take them to the factory or the office.

Concerns about local bus services have risen up the political agenda not only in areas such as Sedgefield over the past couple of years, but in the rest of County Durham. I have a steady flow of complaints from constituents who are incensed at the cuts to services, especially by Arriva, which pulls services at the last moment, without any notification or consultation. Any cancellation of a route is not well advertised. On more than one occasion, whole villages have been left without any services whatsoever. When I compare the services that Arriva has in County Durham with those that it has in London, I think, yes, we should have an excellent public transport service in the capital city, but we need something equivalent in our rural areas as well, with regulation to ensure that there is a social obligation on privatised bus companies to ensure that people can get to work.

Bus services are being cut in our rural areas as part of the expenditure cuts to address the deficit. There has been a 28% fall in funding for councils, combined with the ending of ring-fencing of grants for bus services, a 20% cut in the bus service operators grant paid to bus companies, and a shake-up of the free travel scheme for pensioners. Pensioners now often say, “What is the point of a bus pass if there are no buses to catch because they have been cancelled?” As a consequence of all these cuts, Durham county council has withdrawn £322,000 in funding from subsidised public transport routes, leaving many villages with few or no services in the evening or at the weekend. My postbag has been full of letters and petitions about the repercussions of the changes brought about by spending cuts originating in Whitehall.

Let me explain what this has meant in practice for people needing these services in the rural communities of Sedgefield—villages such Bishop Middleham and Fishburn, as well as Middleton St George, which is in the south of the constituency. One local constituent can no longer get to work without the help of friends, and others can no longer catch a bus and so have to use a taxi, which obviously inflates the cost of getting to work.

Mr John Leech (Manchester, Withington) (LD): I sympathise with the hon. Gentleman’s constituents who face a problem with bus services, but does he accept that this is not a new phenomenon? Rural bus services have been poor in many areas for a long time, and the previous Labour Government did nothing about reintroducing any sort of regulation in areas such as County Durham.

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Phil Wilson: There may have been a lack of regulation, but we had a level of subsidy that had not been cut to the extent that it has been since, and some subsidies that were made available have been paid back to the Treasury.

Angela Smith: Does my hon. Friend recognise that the Local Transport Act 2008 brought back a level of regulation, but it was opposed by the Conservative party with which the hon. Member for Manchester, Withington (Mr Leech) is in coalition?

Phil Wilson: We can see from the lack of people on the Liberal Democrat Benches that this issue is not of particular importance to them. Whatever they said before the election, they are saying exactly the opposite today.

I have a constituent called Mrs Hardy who lives in Bishop Middleham. She has asthma and a heart complaint and has worked at the same place for 34 years. Now she cannot get a direct route to work and arrives an hour late, and the return journey that she has to make does not take her back to her own home. She is quoted in The Northern Echo as saying:

“I am now in the stressful situation of having to beg lifts from friends, colleagues and family and don’t know how I am going to get to work from one day to the next.”

Her story is not unique. However, with the help of Durham county council, I have been able to get Arriva to put on a couple of buses on workday mornings so that people like Mrs Hardy can get to work. That new regime starts on 19 March. Likewise, by applying pressure on Arriva, we have been able to redirect buses around Fishburn. However, that only partly solves the problem and is not the whole answer. There must be many more employees in my constituency who find themselves in such a position.

I have raised this issue with the Department for Work and Pensions. If somebody resigns from their job voluntarily because they can no longer get to work, they can no longer claim benefit because they are deemed to have resigned. The Minister of State, Department for Work and Pensions, the right hon. Member for Epsom and Ewell (Chris Grayling) responded:

“The Jobseekers Act (1995) provides that JSA will not be paid for a period between 1 week and 26 weeks to anyone who has lost their employment as an employed earner by leaving voluntarily without just cause.

The law does not provide guidance on how just cause should be interpreted because the circumstances in which employees leave employment are so varied.”

The Government need to do a bit of joined-up thinking on this issue because it affects many people in rural areas around the country, who we are perhaps not finding out about. This situation needs urgent attention. The Department for Transport needs to liaise with the DWP to find out the extent of the problem in rural areas. The problems with the buses in my constituency came to a head in the new year.

Last week, we found out from the Transport Committee report on the expenditure of the Department for Transport that the money was there to maintain the subsidy, but it was handed back to the Treasury. To use the Select Committee’s word, how “slack” is that? The Select Committee was surely correct to state in paragraph 11:

“Money voted by Parliament for expenditure on transport should be spent on transport, not handed back to the Treasury.”

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My question to the Minister is whether, because the money has been there in the past, it will be there in the future. Will his Department push for extra funding for subsidies so that additional bus services can be provided in areas such as County Durham? There is a lot of talk about the need for growth in the economy. I respectfully suggest to the Government that it is a fundamental prerequisite of any economic growth strategy that employees are able to get to work.

The lack of understanding in this area does not promise much for the future. There seems to have been a fundamental failure in basic arithmetic. The Department has imposed deep cuts to bus grants, leading to the axing of dozens, if not hundreds, of bus routes and to steep fare hikes, only to end up with £543 million to spare. As a consequence, Durham county council and other local authorities are getting the flak for the cut in bus subsidy and the resulting cuts in bus services. My constituents have great difficulties in getting to work, to the hospital, to college or to see friends. The Department for Transport lost £543 million down the back of the sofa, just to find it and hand it back to the Treasury. Will the Minister therefore apologise to Mrs Hardy and the many others who are having difficulty catching a bus today because of his Department’s carelessness?

The letter from the Minister of State, Department for Work and Pensions, the right hon. Member for Epsom and Ewell also states:

“The matter of poor public transport in Sedgefield and County Durham”—

at least the DWP acknowledges that transport in Sedgefield and County Durham is poor—

“is a matter for the Department for Transport. I have forwarded a copy of your letter to that Department so that Ministerial colleagues are aware of your constituents’ concerns.”

Will the Minister tell me what his Department and the DWP are doing to alleviate the situation of poor public transport in places such as Sedgefield and County Durham? Is there any joined-up thinking in Government to alleviate this problem? Finally, what plans does the Department have to re-regulate or regulate more thoroughly bus services in rural areas around the UK so that people who have jobs can get to them?

5.23 pm

Karen Bradley (Staffordshire Moorlands) (Con): I apologise for missing the beginning of the debate. I am serving on a Public Bill Committee at the moment and will have to return to it at some point.

I listened carefully to the hon. Member for Sedgefield (Phil Wilson). I, too, will talk about rural bus services, because my constituency of Staffordshire Moorlands, as one can guess from its name, is incredibly rural. It is also, perhaps uniquely in central England, a constituency that contains neither a dual carriageway nor a mainline train station, which gives us unique transport problems. We are within one and a half hours of three international airports, but I have yet to find a way to get from one of the main motorways that surround my constituency—the M1, the M6, the M56 and various others—to my home in Leek, in the centre of the constituency, in less than 40 minutes. That shows that Staffordshire Moorlands is isolated from much of the rest of the country.

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That poses a challenge, because we want people to come to Staffordshire Moorlands. A third of my seat by geography is in the Peak District national park, which is incredibly beautiful. We have the Manifold valley, the Roaches and other places that we desperately want people to come to and—I mention this as we are debating transport and the economy—spend their money. Given our transport infrastructure, getting them there is obviously not easy.

We have not only the beautiful Peak District national park but Alton Towers, one of the biggest tourist attractions in the country. Again, we want people to come to that great national institution, of which we are very proud. Unfortunately, anybody who has visited Alton Towers will know that to get to it, one has to travel through some beautiful villages where there can be significant traffic congestion. The challenge is to get people to come to Staffordshire Moorlands and spend their money, but also to ensure that the people who live there because of its great beauty can do business and trade with the rest of the country and globally. I recently visited a design company based in the Peak park that does business across the world and needs to be able to get to the motorways and trains, but in a way that does not damage the beautiful environment in which we live.

I say to the Minister that I am not here today to call for great investment in new roads. Perhaps some potholes being filled in would be appreciated, but we are not looking for great infrastructure developments across Staffordshire Moorlands, merely better ways for people to travel.

It is also worth pointing out that some of the most statistically dangerous roads in the country are in and around Staffordshire Moorlands. It is an area very much favoured by motorcyclists, particularly on beautiful sunny afternoons such as we have had over the past few weekends. Rarely does a week go by without an accident being reported in the local newspaper, very often a fatal accident. I know from my local fire service and police that the road traffic accident rate is probably the main reason for the high levels of the activity statistics that they report.

My final point in setting the scene is that Staffordshire Moorlands is a border area. It is the most northerly seat in the west midlands, bordered by Cheshire in the north-west and Derbyshire in the east midlands. That causes specific concerns. For example, on some of our most dangerous roads there are different speed limits at different points, because they cross the borders between local authorities that have made different decisions about the appropriate limit. That causes the problem that drivers do not know what the speed limit is, because they might not be totally convinced about whether they are in Staffordshire yet. The same problem applies to bus services, which I will come to later.

Another important business in my constituency is the great number of hauliers. Being in the Peak District national park and neighbouring the Potteries, we have great natural resources such as limestone and clay, so a haulage industry has grown up. Again, that poses specific problems.

What transport problems have constituents raised with me? I have already spoken about speed limits, and the signposting of them is incredibly important. There is the problem of crossing borders, but also, in some villages there is a change from a 30 mph zone to a

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60 mph zone. Because of those villages being in an area of outstanding natural beauty, signage is not quite as obvious as it should be. A constituent wrote to me only this week saying that they live just on the point where the 30 mph zone starts in the village of Alton, which, as the name suggests, is next to Alton Towers. Many drivers use that road to go to Alton Towers and are unaware that they have just entered a 30 mph zone. We need increased signposting and more traffic calming measures. We have seen great success with the solar powered signs that flash up a warning that a driver is speeding and should be doing only 50 mph, 40 mph, 30 mph or whatever is the appropriate speed. Those traffic-calming measures have been more successful than others.

I congratulate Staffordshire county council, which has been instrumental in introducing 20 mph speed limits outside schools. Some rural schools in my constituency are on very busy rural roads, and a 20 mph speed limit is welcomed by parents. I encourage the council to introduce more such limits in the rest of the constituency.

I would be remiss in a speech about transport in Staffordshire Moorlands not to mention the ongoing local issue of road changes in Leek. That is a matter for the local authority and I am not calling on the Minister to make any specific comment on the detail, but I want to state for the record that anything that can be done to improve the ability of pedestrians to cross the road safely will be greatly appreciated. As things stand, the shops in Leek will not be accessible by pedestrians because there will be no pedestrian crossing between the car parks and the shopping area. That might sound slightly unusual, but it has been proposed and I should like to put on record my concern about it.

The hon. Member for Sedgefield mentioned rural bus services. The Minister has met one of my local bus companies—a very successful family business—and has heard its concerns. Subsidies across different local authorities are a particular concern to local bus companies in the moorlands, and some bus companies run routes across four local authority areas. Establishing what subsidy each local authority provides and what regulation and Criminal Records Bureau checks each imposes makes it difficult for private bus operators to operate in areas such as the moorlands.

Another matter for local bus operators is school transport. As in any largely rural constituency, many schoolchildren in mine travel significant distances between their home and school. School transport provision is raised regularly with me by constituents, and particularly those whose children have to walk long distances down isolated and badly lit lanes to access a bus service to take them to their school, which in many cases is many miles from home.

Road hauliers were probably the only group in the run-up to the election and afterwards to lobby for an increase in VAT, desperate as they were for a levelling of the playing field between them and overseas haulage companies. They were grateful for the increase in VAT, but it will come as no surprise to the Minister to learn that they are pushing for a cut in fuel duty. They are also concerned about EU regulations and raise the matter regularly. Many feel that EU regulations are imposed on them that are perhaps not observed or enforced in other countries. They are keen to ensure that EU regulations

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are not gold-plated for UK hauliers. They want appropriate regulations because they understand, as all hon. Members do, that regulation and health and safety rules are necessary, but there should be a level playing field for our hauliers and those from overseas with which they compete.

While I am talking about haulage and large lorries, I must mention quiet lanes and sat-nav. It will probably come as no surprise to hon. Members to learn that numerous signs are popping up around Staffordshire Moorlands to advise drivers that the route they are recommended to take by their sat-nav is not suitable for heavy vehicles, or often even for normal domestic cars. That is becoming more important in rural areas such as Staffordshire Moorlands, and I am sure hon. Members on both sides of the House have the same experience. Any pressure that the Ministry could put on satellite navigation companies to help them to identify inappropriate quiet lanes would be very much appreciated.

One problem caused by the lack of public transport gets raised with me a lot. People are reliant on their cars, and whenever I do a high school hustings, without fail people mention car insurance for young drivers. The cost is hurting young drivers and preventing them from helping with economic growth by taking apprenticeships and attending training. They need to drive their cars to get to work, but car insurance premiums are a barrier to that.

Although my constituency has no main line train station, as I mentioned earlier, we have an excellent heritage railway, the Churnet Valley railway, which runs wonderful steam trains every weekend. If anyone wishes to visit Staffordshire Moorlands and ride on the Churnet Valley railway, they will be welcome. It is being extended as far as the Cauldon quarry, a large cement works in the moorlands. On Sunday, I was delighted to see the number of cars around the railway lines carrying people to see the steam engines travelling through and to enjoy the spectacle of a steam train travelling through the Peak district.

Richard Harrington: I am conscious that, as has been pointed out to me on several occasions, my hon. Friend’s knowledge of Watford is limited to whizzing through on the train, but notwithstanding what she said about rural areas, I hope she understands that extensions to train services such as the Croxley rail link, for which the Government have just given funding—I am grateful to the Minister for his time and effort on that project—are also important to constituents such as mine, and do not take away from train facilities in rural areas.

Karen Bradley: I agree with my hon. Friend. In fact, my knowledge of Watford extends to having attended a few training courses in Watford over the years, not just to whizzing through on the train. I wholeheartedly concur that any extensions to train services in the Watford area will be greatly appreciated.

The extension of the heritage railway in my constituency is being funded by a private rail company that has been a recipient of money from the regional growth fund—it is very grateful to the Government for that financial support. The company is looking to reopen the line to Stoke-on-Trent from the quarry, which would result in

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an enormous number of aggregate lorries leaving the roads and travelling by train, which would be of great benefit to people living in the Moorlands. The quarry owners, too, are keen to get as much on the railway as possible.

Bob Stewart (Beckenham) (Con): I have had the privilege of visiting Leek—it is a beautiful place—and I have seen that railway line. Perhaps it might be possible to run a passenger train on it, as well as the steam trains and freight trains. That would help without putting any more danger on the roads.

Karen Bradley: That is exactly what Moorlands and City Railways wishes to do. It would like passenger trains to return to Staffordshire Moorlands for the first time since the line was officially closed in, I think, the 1950s. There is a problem, though: part of the line extension would involve relaying track to the village of Alton to provide access to Alton Towers by train. In theory, that is a good idea, but that part of the country is an area of outstanding natural beauty and the residents along the railway track are very concerned about the proposal. Although I can see the benefits of getting traffic off the roads, it has to be done sympathetically.

Andrea Leadsom (South Northamptonshire) (Con): Does my hon. Friend agree that such consideration for areas of outstanding natural beauty should be taken into account for all train systems, or does she limit her remarks to Staffordshire Moorlands?

Karen Bradley: I fear that my hon. Friend’s question might be related to a certain high-speed line, which is something that I was going to touch on briefly.

Jessica Lee (Erewash) (Con): I thank my hon. Friend for speaking so eloquently about her local trains and infrastructure. I am sure that she agrees with me about the importance of the investment that the Government are making in local infrastructure, such as reopening the train station at Ilkeston, for which we in Erewash have been campaigning for a long time, .

Karen Bradley: I know how much hard work my hon. Friend is putting into reopening the train station at Ilkeston. As one from a neighbouring county, I am well aware that that would be a great asset to the residents of Ilkeston and the people of Derbyshire.

Anna Soubry (Broxtowe) (Con): And Nottinghamshire.

Karen Bradley: Absolutely.

I cannot pretend that HS2 will affect Staffordshire Moorlands directly, as it is not scheduled to go through the moorlands. My concern is that, although it is half an hour away, there is already an incredibly good high-speed rail service, with journey times of an hour and 24 minutes, on the west coast main line between London Euston and Stoke-on-Trent. Although I have my half-hour journey at the other end, it is still a fast line. My great concern is that if HS2 was introduced without imposing capacity requirements on the line, my existing high-speed train line would be lost.

Let me make two further remarks before I finish. The first is about the Peak park cycleways, which I thoroughly encourage everybody to use. People will soon be able to

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cycle round the whole of the Peak park without setting foot on a road, and they will be able to get there by train. Secondly and finally, let me say something about inland waterways, although I know that they are not strictly within the Department for Transport’s remit. We have some fantastic inland waterways, but I would like more use to be made of them.

Several hon. Members rose

Mr Deputy Speaker (Mr Lindsay Hoyle): Order. I understand that this debate is important, but if we want to get everybody in, we will unfortunately have to drop the time limit to six minutes.

5.41 pm

Jonathan Ashworth (Leicester South) (Lab): I start by paying tribute to my hon. Friend the Member for Liverpool, Riverside (Mrs Ellman), who spoke with great eloquence and distinction. She spoke a lot of good sense on behalf of the Transport Committee and I agreed with every word that she said. She is quite right to draw the link between the wider impact on economic growth and investing in and building a modern transport infrastructure.

The Transport Committee’s recent paper highlighted the need for the Government to

“ensure that where it approves transport schemes designed to stimulate economic growth and rebalance the economy, they are supported by convincing economic development strategies.”

In my brief speech I will argue that electrification of the midland main line meets exactly those criteria, but although that is what I want to concentrate on, I will start by saying a word or two about high-speed rail.

On balance I support high-speed rail, although I understand the arguments against it, not least the argument put by hon. Member for South Northamptonshire (Andrea Leadsom). However, I want to put a point to the Minister on which I hope he can reassure me in his summing up. There is concern among campaigners for the electrification of the midland main line that they may not see any direct advantage from HS2—that resources for the scheme will be taken away and we will never get electrification. [ Interruption. ] The Minister is shaking his head, but that is a genuine concern, so perhaps he can touch on it in his response to the debate.

Andrea Leadsom: As I will not get the opportunity to speak later, I want to ask the hon. Gentleman whether he agrees that there is a concern about the total cost of high-speed rail, bearing in mind that the Y shape is not even known yet, and the rising cost of mitigation and compensation that is the inevitable result of that uncertainty? Does he share my concern about the impact that that will have on scarce resources?

Jonathan Ashworth rose—

Mr Deputy Speaker: Order. Before the hon. Gentleman answers, let me remind hon. Members that the idea behind imposing a time limit is to get everybody in. He is well placed, but every time there is an intervention, that adds another minute, which means that somebody else will drop off the bottom.

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Jonathan Ashworth: Thank you, Mr Deputy Speaker. To help other Members get in, I will take no more interventions. In answer to the hon. Lady, I recognise that concern, but on balance I think that HS2 is a good investment for the economy. However, I want to focus on the midland main line, if she will allow me.

I would be grateful if the Minister passed on my thanks to the Minister of State, Department for Transport, who last night kindly met me, my right hon. Friend the Member for Leicester East (Keith Vaz) and the deputy mayor of Leicester, Rory Palmer, to discuss electrification. It was a good meeting, and I was grateful for the way she responded to our questions.

I would argue that electrification makes economic sense. The midland main line is the slowest northbound route out of London. It is the only main line to London that has not been electrified and where there are no immediate plans for electrification. Electrification would mean improved journey times, improved performance times and improved reliability. Crucially, electrification ought to provide good value for money: estimates show that savings in operating costs and increases in passenger revenues would greatly exceed investment costs. Full electrification along the line would reduce the costs of rolling stock, energy and maintenance and would therefore meet the aspirations of the McNulty review. It would bring huge benefits to cities such as Leicester and to the east midlands as a whole, as well as to Sheffield and South Yorkshire.

Angela Smith: Does my hon. Friend agree that the increased relationship between Rolls-Royce and Sheffield means that connecting Derby and Sheffield more efficiently would be good for the economies of both cities?

Jonathan Ashworth: I said that I would not give way again—my apologies, Mr Deputy Speaker. My hon. Friend is quite right, though: Rolls-Royce is a major employer in Derby and elsewhere in the east midlands—in Hucknall, for example—and connecting Derby and Sheffield in that way is crucial for the economy.

One analysis has shown that the electrification of the line would benefit the economy by £12 million a year and by almost £450 million over the appraisal period, which makes an overwhelming case for it. It would also improve our links with Northamptonshire, making it easier for me to visit the hon. Member for South Northamptonshire (Andrea Leadsom) should I wish to do so, as well as the links between Derby and Sheffield. All estimates suggest that the conurbations served by the midland main line are set to grow—between 2000 and 2010, the population of those areas grew by 300,000, and estimates suggest that it will grow by 800,000 by 2030—so in addition to the economic reason for the investment, there is also the simple reason of population growth.

The trains currently running on the route are diesels, and research suggests that CO2 emissions could be reduced by 43,000 per annum as a result of electrification. There is therefore also a good environmental argument for pressing ahead with electrification. There is another strong value-for-money argument, which is that electrification would result in immediate job creation along the line, it would boost the economy, and it would help cities such as Leicester to attract more inward investment. I am sure that it would do the same for other

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cities in the region and in south Yorkshire. It would bring long-term advantages to Leicester and the wider east midlands, and it will therefore be crucial for our region in the next few years.

As I said, I am grateful to the Minister of State for meeting us last night, and I hope that the Under-Secretary of State replying to this debate will pass on my thanks to her. Last week, at Transport questions, the Minister of State told me:

“The electrification of the midland main line has been prioritised by the industry in its initial industry plan, which will form an important part of the decisions that we have to make on what will be funded in the next railway control period.”—[Official Report, 23 February 2012; Vol. 540, c. 1012.]

That answer aroused a great deal of excitement on that evening’s edition of the BBC’s “East Midlands Today”, and in my own fine newspaper, the Leicester Mercury. If the Under-Secretary wants star billing on “East Midlands Today” this evening, or in the Leicester Mercury, the Nottingham Post or the Derby Evening Telegraph, he need only get up and announce from the Dispatch Box that he is going to strike while the iron is hot, build on the profile that the Minister of State already has in the east midlands, and say yes to the electrification of the midland main line.

5.48 pm

Mr John Leech (Manchester, Withington) (LD): I should like to begin by congratulating the hon. Member for Liverpool, Riverside (Mrs Ellman), the Chair of our Select Committee, on securing this debate and opening it this afternoon. The contributions so far have been varied, covering a wide range of transport issues from up and down the country. I want to concentrate on the specific elements of the Committee’s “Transport and the economy” report that deal with the role of transport in rebalancing the economy.

During this time of economic uncertainty, transport must be a key factor in stimulating growth. To their credit, the coalition Government have learned from the mistakes made by previous Governments during economic downturns and prioritised investment in transport infrastructure. While other Departments saw an average reduction in capital expenditure of 29%, the transport capital programme was reduced by only 11%, with Treasury forecasts that by 2014-15 capital investment would be higher in real terms than it was in 2005-06. This has meant that a number of capital schemes have been able to go ahead that would almost certainly have faced the axe in previous economic downturns.

As a northern MP representing south Manchester, I welcome the Government’s commitment to economic rebalancing and reducing the north-south divide. This received a cautious welcome, I would say, in the Select Committee report. Transport funding has consistently favoured London and the south-east to the detriment of areas of the north and the south-west. If we are to see a rebalancing of the economy, this needs to be reflected in current and future transport funding.

Fiona Mactaggart (Slough) (Lab): On that issue, I share the view of the hon. Member for Wimbledon (Stephen Hammond) that some projects in the south

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are essential to UK inward investment. More specifically, I would say that Heathrow is the only hub airport in Europe that does not have a rail link to its immediate hinterland. It has one to London, but nothing to the Thames valley, which is the most productive area for inward investment in the UK and is obviously essential to get growth in Britain.

Mr Leech: I thank the hon. Lady for that intervention. It is fair to say that the Government have prioritised some schemes in London and the south-east—the Crossrail project, for instance, which has received an enormous amount of money. Other parts of the country have certainly received significantly less funding over a long period.

There are some encouraging signs, however. In Manchester, rail capacity and journey times will benefit greatly from the additional electrification work, including that of the TransPennine Express, and the funding for the Ordsall chord. Congestion will be eased with the completion of the airport link road—a scheme for which my hon. Friends the Members for Cheadle (Mark Hunter) and for Hazel Grove (Andrew Stunell) have been campaigning for many years. Metrolink extensions have also been given the green light and are under construction, including within my constituency.

From a Manchester perspective, two projects hold the key to whether the Government’s commitment to rebalancing the economy will be followed through to its conclusion. The first is high-speed rail, and the second and more urgent is the funding for the northern hub, which I am sure the Under-Secretary of State for Transport, my hon. Friend the Member for Lewes (Norman Baker), will be sick of me raising with him on so many occasions.

The debate about high-speed rail will drag on, with supporters and opponents making arguments and counter-arguments about whether the real economic benefits are predominantly for London and the south-east. However, what cannot be disputed is the fact that the north will see the greatest possible level of benefit only once high-speed rail reaches Manchester and Leeds. I welcome the Government’s commitment to the next phase of the high-speed rail network, but I want to know what the Government are doing about bringing forward the timetable, so that we do not have to wait another 20 years before we reap the full benefits.

I recognise that for once the Government are looking towards our transport needs for the next 100 years rather than for the next 10 years, but we need to do more to bring forward the time scale so that the regions can benefit as soon as humanly possible.

From Manchester’s perspective, however, the real test for the Government will be whether or not funding will be forthcoming for the northern hub. With £80 million already secured for the Ordsall chord, the complete hub scheme will cost only £560 million in total—and possibly less, given that some elements of the project are already included in other committed individual schemes. We should compare this to the billions of pounds that the Government have committed for Crossrail.

In a Westminster Hall debate in January, the hon. Member for Blackley and Broughton (Graham Stringer), who is not in his place this afternoon, calculated that three months of Crossrail payments would pay for the whole of the northern hub. I am not sure how accurate

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the hon. Gentleman’s maths is, but it certainly puts into perspective the difference in funding levels for the two schemes. At a cost-benefit ratio of 4:1, with an estimated 20,000 to 30,000 new jobs and a £4 billion boost to the economy, the northern hub is the opportunity for the Government to show their commitment to rebalancing the economy.

I questioned the Minister of State, Department for Transport during the Select Committee inquiry, and she said that the northern hub

“must be a really strong contender for support in the next railway funding settlement control period.”

She went on to confirm the Government’s intention to try to close the prosperity gap between the regions, saying:

“One of the ways in which we could do that is by targeting our transport spending on projects which will generate growth in different regions.”

Well, I could not agree more. If the Government are serious about economic rebalancing, they need to confirm the funding for the northern hub, and not just in a piecemeal way. The Government need to come up with all the cash in control period 5.

In the short time left, I should like briefly to raise two other issues mentioned in our report. The first relates to the dependence of transport priorities on local circumstances. A one-size-fits-all or a Government-know-best approach will not work. In line with the coalition Government’s localism agenda, there needs to be more local determination of what works in each local area. National Government is not well placed to decide what is best for an individual area and what will best support economic growth. Metrolink has been a massive success in Manchester, driving economic growth and stimulating regeneration to areas such as Salford Quays and Eccles, as well as encouraging modal shift in areas such as my constituency.

The need for local decision making was reflected in the report’s conclusions—

Mr Deputy Speaker (Mr Lindsay Hoyle): Order.

5.56 pm

Angela Smith (Penistone and Stocksbridge) (Lab): I start my short contribution by paying tribute to the Chair of the Select Committee, my hon. Friend the Member for Liverpool, Riverside (Mrs Ellman), who has shown astounding leadership for some time. I am particularly proud that this report is being debated today, as I was a member of the Select Committee when we first met after the election. Indeed, I was one of those calling for this inquiry, so I am particularly pleased to be able to contribute to today’s debate.

The report on “Transport and the economy” is an important one. We have heard broad statements and warm words from the Government for some time about transport and its role in supporting economic growth, but there is no sense of how their decisions on transport fit into a strategy, and no clear sense of how any particular scheme announced by the Government will fit into a strategy for economic growth. Nor is it clear how the Government’s decisions will help to deliver their stated intention of rebalancing the economy. I therefore welcome the report’s recommendation that a White Paper on transport and the economy be produced

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exactly to clarify that point. The report is important, too, because it makes clear that investment in transport infrastructure needs to be linked to plans for economic development. HS2 provides a good example.

The argument for HS2 is partly about capacity, so it relates strongly to the role cited in the Eddington report for transport investment to reduce congestion, thereby removing barriers to economic growth. HS2 is also about bringing economies across the country closer together, improving the dynamics of those relationships—in other words, the agglomeration benefit.

Mr Kevan Jones (North Durham) (Lab): Does my hon. Friend agree that unless some time line is put on extension of HS2 further north, there will be considerable cynicism in areas like the north-east that a great deal of investment will be made that will have very little economic impact on such regions?

Angela Smith: I wholly concur. In fact, if we are to maximise the agglomeration benefits of HS2, I would argue that the economies—from the far north to London and the south—that are linked by the HS2 line must have clear strategies in place for economic development in order that the transport investment represented by high-speed rail can perform to its full potential.

Phil Wilson: It is obviously vital that the HS2 route eventually reaches the north-east of England. I do not know whether my hon. Friend is aware of it, but Hitachi is building a train-building facility in Newton Aycliffe in my constituency. It has already said that if this project goes ahead, it will be bidding for the rolling stock.

Angela Smith: That illustrates my point about the need to have clear plans for economic development in place alongside plans for transport investment.

The report is also important because it points out very clearly that there is a lack of transparency and consistency in the decision-making process at the Department for Transport. Finally, it is important because it points out that the removal of regional structures created by the last Government risks creating a vacuum in effective planning for transport infrastructure.

I want to focus particularly on the report’s recognition that the Government should produce a White Paper explaining explicitly how their plans for transport investment will be linked to their plans for the economy more generally, and in particular explaining their plans for rebalancing the UK economy. Rebalancing is important not just to the economic development of areas such as the north-west and Yorkshire but to the whole country, including London and the greater south-east.

We need transport investment to maximise the potential for a more dynamic set of relationships between economies across the country. HS2 is a case in point. According to The Northern Way, its potential impact of £13 billion would deliver at least £3 billion of economic impact to the north. The point is, however, that its economic impact will affect the whole country, and therefore potentially benefits everyone.

What do we need if we are to rebalance the economy in transport terms? I believe that we need three things. First, we need more transparency and greater consistency in decision making, so that we can hold the Government

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to account in relation to their stated aim of rebalancing the economy. Secondly, we need political bravery: we need to use investment to maximise economic development in areas such as the north of England, and to remove barriers to growth in those areas. Thirdly, we urgently need to know more about how the Government will develop sub-regional, regional and even cross-regional structures enabling them to produce sound, well-thought-out strategies for the delivery of transport infrastructure.

The removal of the regional development agencies and, by definition, The Northern Way group of RDAs, has left a vacuum in regional planning, especially—as the report points out—in the context of their role in supporting regional economies. Moreover, the local enterprise partnerships have not been thought through. How will these new structures working at sub-regional and city-regional level work structurally across LEP boundaries to deliver what our regions need?

The north of England is a perfect example. As a result of The Northern Way and its superb work in developing arguments and strategies relating to transport, the case for the northern hub has been clearly made and accepted even by the coalition Government. The northern hub is needed, of course, to tackle congestion on the northern rail network, thereby helping to remove barriers to economic growth; but it is also needed in the context of the decision to go ahead with HS2. It is important that we deliver both projects in order not just to reduce congestion on the network but, as I mentioned earlier, to maximise the potential benefit of HS2.

If we are to maximise the potential of HS2 to make the relationship between the economies of the north and London more dynamic, we must also ensure that those agglomeration benefits are spread across the north. If that is to happen, the Government must recognise the importance of transport infrastructure in supporting economic development plans. In particular, they must recognise our great northern cities as hubs for economic development. They must recognise the importance of greater connectivity—not only with London, on a north-south axis, but on an east-west axis, between the northern urban centres, and with international gateways not just at Heathrow and Gatwick but at the mouth of the Humber and Mersey rivers.

We need regional planning. As the report says, without it there will be a risk that choices will be made on a basis that discriminates against weaker economies. There is already an example of that in the form of the Government’s decision to electrify the Leeds-to-Manchester cross-Pennine route, which discriminates against what I call the third point of the golden triangle of the north: the city of Sheffield.

We need the Govt to recognise the broader context of an economic policy that involves stimulation of the economy and the role that transport could play in it. Long-term infrastructure projects should be brought forward, as outlined in Labour's alternative plan for jobs and growth, but instead we are seeing significant cuts in investment, such as the £759 million cut on top of the £528 million efficiency savings supported by Labour.

We also need the Government to recognise the spending disparity between the north and the south. The Passenger Transport Executive Group has produced some interesting figures. In 2010-11, transport spending per head was

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£774 in London and £276 in Yorkshire and the Humber. The source of those figures is the most recent version of a public expenditure spending analysis from Her Majesty’s Treasury. I ask the Minister to respond to them, and to demonstrate by way of a full written explanation—

Mr Deputy Speaker (Mr Lindsay Hoyle): Order. I call Stuart Andrew.

6.5 pm

Stuart Andrew (Pudsey) (Con): I am grateful for the opportunity to speak in the debate.

Transport clearly affects all our constituencies. My own constituency forms part of the city of Leeds, which is the biggest financial centre outside London and, as such, as been hugely successful. People from throughout the county work there every day. That success has put huge pressures on our transport infrastructure, and all our railways and roads are heavily congested. As a result of that and the conversion of ex-employment sites in my constituency—particularly the old mills—into residential developments, more people are travelling to work, thus adding to the congestion. In the current more difficult economic climate, it is more important than ever for us to do all that we can to make it easier for people to travel, because that will help business to be active in a wider geographical area. An increase in economic activity will present real employment opportunities to people who are out of work.

Given that the Government have an unprecedented deficit to deal with—let us not forget that that is the biggest threat to economic growth—it is impressive that they have been able to announce so many major transport projects. For instance, it has been announced that in my own area, in Leeds, the M62 is to be widened. Anyone who has travelled on that road will know how congested it is. The southern access to Leeds railway station will create an opportunity for the southern part of the city to develop economically. New railway stations are being built at Kirkstall Forge and Apperley Bridge, which will help with congestion and will also release £250 million of private investment. The electrification of the line between Manchester and Leeds will be a huge benefit: anyone who has tried to get on to a train on that line at peak times knows how horrendous the journey can be. Extra trains have also been provided on the Airedale line.

Geraint Davies (Swansea West) (Lab/Co-op): Will the hon. Gentleman—who is a member of the Welsh Affairs Committee—support my call for the electrification of the line from Cardiff to Swansea, and say no to any prospect that people will have to get out at Cardiff on the way to Swansea from London?

Stuart Andrew: As the hon. Gentleman knows, the Committee is considering the issue of east-west travel. I look forward to his contributions, for he is a diligent member. [Interruption.] I will not say any more at the moment. I have my own area to fight for.

HS2 means that we can now connect our great cities, create thousands of new jobs, and release desperately needed capacity. That is real investment, which can only help to increase our economic activity.

Let me now say something about the differences in spending in different parts of the country. For years, spending per head in the north has been considerably

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less than that in the south. Under the last Government, spending per head in Leeds was less than the national average. That difference still exists, and it is important for us to deal with it. In the many transport debates that we have had during the last couple of years, Members in all parts of the House representing all parts of the north of England have raised that concern, and we now have an opportunity to do so again.

The Yorkshire Post has led a major campaign to highlight the problem, and I praise it for its work. It has built a coalition of business leaders, transport bosses and politicians. However, although we have benefited from many recent projects, the gap is still large; and although we are starting to see a decrease, for which I thank the Government, we need to continue the trend in a high-speed way. All that we in the north, and those involved in the Yorkshire Post campaign, ask is a bit more fairness. Of course London is the powerhouse in economic terms, but extra investment is desperately needed in the north. In my constituency, the ring road is congested, the access to Leeds airport is poor and the A65 is constantly congested. Members on both sides of the House have mentioned the northern hub, and investment is certainly needed in that. On a recent Select Committee visit to Wrexham, I thought I would be green by getting the train from Wrexham to Leeds. In a car, that journey can be done in about an hour and a half. It took me four and a half hours by rail, and I had to board five different trains.

There are major businesses in Wrexham, Liverpool, Manchester, Leeds, Hull, Newcastle and Sheffield—

Andrew Percy (Brigg and Goole) (Con): And Goole.

Stuart Andrew: Yes, and Goole. We must do all we can to ensure that those businesses can connect with each other and do business with each other. Connecting with each other is an horrendous ordeal for them at present. Improvements to the northern rail routes have been desperately needed for years.

I welcome the fact that the Government have made a start. The electrification of the line between Manchester and Leeds will prove to be a great improvement that helps us economically. The north was a huge player in our industrial past, and we must give it all the resources it needs to be able to be a huge player in our industrial future. Investing in our transport infrastructure will help us enormously. The Government have got off to a good start. I just hope they can do more in the future.

6.11 pm

Jim Shannon (Strangford) (DUP): I am a Northern Ireland MP and transport is a devolved matter, but I have some questions for the Minister.

I welcome the money that will be spent on the transport infrastructure. Only one person has been injured during the construction of the Olympics stadiums and other works, and no one has been killed. The road and rail links with the Olympic village and facilities must be addressed, however. In that regard, does the Minister believe the necessary transport infrastructure is now in place for pedestrians as well as for road and rail users?

In Northern Ireland the spend on road maintenance is about £2,800 per kilometre, compared with £12,000 in England and £7,500 in Wales. Reconstructing a road

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can be four times more expensive than the cost of maintaining it. How much of the investment that has been announced will be spent on new roads and how much will be spent on resurfacing existing roads? Northern Ireland has a policy of resurfacing roads every 25 to 30 years, and if the work is done right the first time, the road will be okay. I understand, however, that some roads have had to wait for as long as 68 years before being resurfaced. Is that situation unique to Northern Ireland?

The Northern Ireland Executive have said that they will spend £500 million on creating and improving crucial transport routes from Belfast to other major cities and towns. That shows that they recognise the importance of our transport infrastructure. They also recognise the importance of our construction sector. The hon. Member for Staffordshire Moorlands (Karen Bradley) mentioned construction, and it is important to create apprenticeships and other opportunities within that sector. I acknowledge that the Minister does not have direct responsibility for that, but does he have any input?

I have recently been serving on the Civil Aviation Bill Committee, and that experience served to remind me of the importance for airports of good road and rail links. That can generate considerable economic benefits. Has the Minister considered increasing expenditure on projects around not only major airports such as Gatwick and Heathrow, but provincial airports on the UK mainland? That would also benefit Belfast City and Belfast International airports.

Gavin Williamson (South Staffordshire) (Con): The Government have reduced air passenger transport duty for Northern Ireland. Does the hon. Gentleman agree that that gives Northern Ireland a fantastic opportunity to market itself and to develop and promote its aviation industry and airports?

Jim Shannon: I entirely agree. We campaigned for that, and it has given a great boost. We are grateful to the Government. Problems could arise, however, if airports in other parts of the UK ask for the same measure.

We should also consider our ports and ferry links. Will the spending that has been announced benefit any of the UK mainland’s ports? If the road links to Liverpool and Stranraer are good, that will be good for Northern Ireland. When I visit the United States of America, I am always struck by the ease and speed of road travel. That shows that infrastructure investment can greatly benefit people and the economy.

We want good infrastructure to be put in place and the construction industry to benefit—and apprentices to benefit from that. We believe that better transport infrastructure will be good for regional economies and will make the roads of the United Kingdom safer.

6.17 pm

James Wharton (Stockton South) (Con): Like many Members who represent constituencies far away from London, I spend a lot of time travelling on public transport—in my case, over three hours twice a week on the train down from Eaglescliffe in Stockton South. I am therefore aware of the importance of transport for regions such as the north-east and the vital role it plays

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in our regional economies, so I am very pleased to have this opportunity to speak about transport and the economy and the Select Committee report.

The report makes a number of interesting observations and recommendations. It recognises the importance of transport to our economy. That is key at the current time, when driving economic growth is so vital. It also stresses the importance of our international gateways, both airports and ports. The Government must focus on those gateways and thereby maximise the economic benefits to the country.

Airports are important not only as international hubs, but as regional hubs. Our regional airports are very important to local economies across the UK. In the north-east, we have Newcastle airport and Teesside airport. The latter lies partly in my constituency and partly in that of the hon. Member for Sedgefield (Phil Wilson), while a small part also lies in the constituency of the hon. Member for Stockton North (Alex Cunningham). Recently, it has been discussed in the House on several occasions, as it has faced a challenging time of late. There has now been good news, however. It has been bought by Peel, a company that was involved previously. It has made clear its commitment to run Teesside airport as a successful passenger airport. That is precisely what people in communities across Teesside, the wider north-east area and north Yorkshire who use and rely on its services want.

In a Civil Aviation Bill debate I raised this topic and asked whether the Government could use the licensing conditions they apply to major strategic airports to require them to retain slots for Teesside. In this debate, I shall explore another possible means by which to address the problem: the public service obligation. Will the Minister share his thoughts on the possibility of using that? Under EU Council regulation 2408/92, the Republic of Ireland established public service obligations between Dublin and Kerry, Galway, Sligo, Knock, Donegal and Londonderry commencing in 2008. This can be done; it is quite possible for a Government with the right strategic view to consider the needs of regional airports and, within existing EU regulations, establish PSOs that can protect them and enable them to prosper.

In December 2007, a Transport Minister said in answer to a parliamentary question that it was for regional bodies to apply for a PSO for Teesside airport. In February 2010, in a reply to Lord Bates, the relevant Minister in the other place confirmed that no application had been received at that time from the regional development agency, One North East. That failure by the RDA to engage constructively in finding a way to protect important routes between the north-east and the capital reflects some of the challenges that Teesside airport faces today. We have an opportunity to revisit whether a PSO should be given to Teesside airport.

High Speed 2 is not quite set to come up to the north-east yet, although we hope it will do so one day, as it is an important infrastructure investment that the Government are committed to making. They have recognised the economic benefits that reduced travel times between the capital and the regions can bring. Teesside falls just outside the envelope that will benefit from HS2, and I suspect that other hon. Members will agree with me when I say that we have the opportunity

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to make the argument that we should examine whether a PSO for Teesside should be introduced for the period until that gap is filled—until HS2 extends further north and benefits the community that I represent, along with those of other hon. Members in the region.

I therefore wish to ask the Minister and the Department this: in the light of the answers given by Ministers in 2007 that it is for regional agencies to make a PSO request and in the light of the confirmation given in 2010 that no such request had been made, what would happen if the local enterprise partnership requested a PSO for Teesside airport? A single LEP now covers the entire airport site, even though it is in a number of constituencies, so if such a request were made, supported by local councils, business leaders and, no doubt, hon. Members, would the Government examine it? Will they consider that option? Will they constructively work with me and others to deliver it, so that the future of this important airport, which has so much potential to be a driver for our regional economy, can not only be secured in the long term, but improved to deliver a better service to my constituents? That would allow my weekly journeys down to London and back up to my constituency to be shortened somewhat from the three and a bit hours they take today. I look forward to the Minister’s comments and would be grateful for confirmation on that point, so that I can pursue the matter with the LEP. I hope that a constructive way forward can be found for this important regional asset.

6.22 pm

Julian Sturdy (York Outer) (Con): It is always a pleasure to follow my hon. Friend the Member for Stockton South (James Wharton). As a member of the Select Committee on Transport, I have a great interest in all things transport-related, from aviation and road to rail and shipping. A 21st-century Britain needs a 21st-century pragmatic transport strategy. Although politics is usually, and regrettably, played as a short-term game, transport strategies and infrastructure projects require a steady long-term commitment. It is rarely possible for such projects to deliver results within a Parliament or two, but that fact should enable us to take party politics out of the mix and unite across this House on a common goal to deliver a long-term, all-encompassing transport plan.

On a wider note, I should stress that my interest in transport policy is not born simply of my serving on the Transport Committee; it also comes from a far more regional and local perspective. On a regional level, as a Yorkshire MP I know that transport links play a vital role in bridging the north-south economic divide, which previous Governments have failed to address. This issue is vital to providing a sustainable long-term economic recovery for our country and for the Yorkshire region.

On a more local level, congestion and gridlock has an impact on the daily lives of my constituents. However, it is not just local households who struggle with such congestion, as businesses are being hit hard, too. The York northern ring road and the A64 act as a brake on local economic growth, bringing increasing congestion, more accidents and costly delays. As the Transport Committee’s second recommendation in its “Transport and the economy” report outlined, investment in this regard is “a high priority” so that we can support economic growth, locally and nationally.

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Travelling through or around the city of York can be an extremely time-consuming exercise. York’s infrastructure is often seen as a nuisance, but the sad reality is that it could get a lot worse, and rather quickly too. The City of York council’s draft local development plan contains some stark warning signs. It states that

“congestion delay time across the network could triple by 2026”

and that

“even with all reasonably practical and deliverable transport investments in place, congestion delay across the network will double by 2026.”

Such a frank and honest assessment is frightening. The link between transport infrastructure and economic growth is undisputable, so my fear for York and for the rest of the country is that economic growth over the next decades will become increasingly choked by the outdated infrastructure. We may want companies and businesses to invest for the long-term future in northern cities such as York, but they will require certainty that there is a long-term plan in place to deal with congestion—a long-term plan that they can buy into.

Geraint Davies: In 2014, we will have the centenary of Dylan Thomas’s birth in Swansea, and we are looking forward to massive tourism investment as a result. Does the hon. Gentleman agree that it is important that business and the people managing these things know in advance that the electrification of lines will take place, for instance between Cardiff and Swansea, so that they can plan ahead and business has good time to make that inward investment?

Julian Sturdy: Absolutely. Tourism is also a key element in York’s local economy and the congestion is having an impact on the tourism level in the city. Sadly, my local authority in York would rather tinker with small-scale schemes than take the difficult long-term decisions that will safeguard the city’s economic future. As I mentioned at the outset, we need a fearless transport strategy. We need a long-term approach to investment at a national level and implementation locally. The Government’s £3 billion of capital for local road projects outside London, to be spread over the next four years, is therefore a welcome starting point, but is that the sum part of a long-term strategy for our roads? The crux of road investment is long-term, joined-up thinking.

I shall now discuss another form of transport. We have to tackle aviation issues seriously, and we face two problems. Airport capacity in and around London is at breaking point. We should be enormously proud that our capital city has remained resilient over a number of years, maintaining its position as the best place in the world to do business. Although international politics and powers have changed, London has remained at the top table, with a positive knock-on effect for the rest of the UK. However, if we refuse to expand our capacity, we risk throwing away our the capital’s crown and, again, our economy, both nationally and locally, will suffer.

Mark Pawsey (Rugby) (Con): Does my hon. Friend agree that some of the slack that exists in regional airports could be used to deal with the shortage of capacity at Heathrow? I am thinking, in particular, of Birmingham airport, which is just 90 miles away from Heathrow.

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Julian Sturdy: I absolutely agree with my hon. Friend. I will touch on regional airports if I am able to do so, but he rightly says that there is some slack there. That is certainly the case at Birmingham, as the Transport Committee has seen on some of its visits.

As developing nations hold the key to global economic recovery, it seems ridiculous to suggest that Britain’s creaking aviation capacity cannot or should not be expanded. I share the Transport Committee’s concern that the Government’s aviation strategy to date has been limited. However, many different ways to improve this situation exist and I am pleased that the Government are consulting on how to increase aviation capacity in the south-east. Alongside the consultation, we must look again at regional airports, as a number of Members have mentioned. Such aviation links to road and, increasingly, rail are hugely significant and connectivity must be the buzz word in this subject.

As remarkable and impressive as our railways are, there is no denying that many parts of them are in need of an upgrade, and I am truly grateful to the Government for funding the electrification of the trans-Pennine line between Manchester and York. That is exactly the sort of upgrade that will improve links and productivity between Manchester, Leeds and York, with positive consequences for the businesses located within and among those three key northern cities, as well as play a key role in tackling the north-south divide.

I appreciate that I have touched on a number of different issues, but that is both the beauty and the difficulty of transport. If I had more time, I would probably go further. I hope that I am not being too optimistic in saying that I truly welcome the Government’s approach. Electrification, high-speed rail, the northern hub—although I recognise that we need the whole thing on the northern hub—and the £1.4 billion for roads, to name but a few aspects, are positive steps in the right direction. I must also commend the Department for Transport for doing so much while registering an underspend in its budget. More for less is a commendable message for this Government to send out and I for one am most impressed by the Transport team.

6.31 pm

Anna Soubry (Broxtowe) (Con): There is a reason why so many hon. Members and so many of my hon. Friends are queuing up to speak in this debate. We all recognise the hugely important role and value of a good transport system in and to our constituencies and therefore the nation as a whole. Indeed, a good public transport system and a good transport system are the arteries of economic life. I am no exception to those hon. Members on both sides of the House who so often come together to support such projects, putting aside our party political differences.

I do not want to repeat everything that has been said by the hon. Member for Leicester South (Jonathan Ashworth), but I agree with him very much and I hope that the Government will take on board the arguments that will, without doubt, be made by many Members on behalf of all of us on that route up to Sheffield from London —the midland main line route. We desperately want it to be improved and hope that we will see electrification, which will benefit both our region and our area. It has been estimated that the wider economic area would benefit by £400 million if that line were improved.

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I am grateful to the Government for saying that after many years—more than I would care to remember, because it would give a real indication of my age, but people have been asking for this for decades—the A453, the major route from the M1 into Nottingham city, will be improved. I am so grateful that the Government have finally given the go ahead and hope that they will now give us all a date for when that road will be widened. Anybody who has travelled along the A46 will know and appreciate what a first-class modern road can deliver, benefiting not only the motorists but our quality of life and economic growth.

I do not want to speak for too long and I do not wish to be rude, but I will not take any interventions, because I know that many Members want to speak. Let me add one point. It is imperative that when we improve our transport system we work as much as we possibly can with the people who will benefit from it, or we will find that their lives are hugely disrupted. The tram route is an example of that. The Minister will be familiar with the debate in my part of Nottinghamshire about the tram route, which will now come out of Nottingham and up to Toton in my constituency. The proposal has been very controversial because of the route. Broxtowe Conservatives were always opposed to it, and I am proud to have been part of their campaign. I know that the arguments have been well rehearsed, but now that work has started, we are seeing why there was such opposition. It has led to considerable disruption—and there will be more—to the lives of ordinary people through the taking of gardens, the demolition of homes and so on. In particular, at the terminus of that route, very vulnerable green-belt land has been made into a housing development area. When we consider such schemes, we must look at the broader issues and the fact that there might sometimes be detrimental and harmful consequences for people who live on the route or at the end of it, and who want to protect their green belt. We have seen that in Toton, where an application has been made for some 800 homes on green-belt land, largely based on the fact that there will be a terminus at Toton.

Unfortunately, we must always be careful when we consider how to finance some routes and extensions to public transport. Let me take the tram as an example, although I will not rehearse the many arguments about such agreements and whether there is a bias towards tram routes over bus routes. Nottingham city council—the hon. Member for Nottingham South (Lilian Greenwood) might address this in her speech—has introduced a workplace parking levy to finance the two new routes. In my view, that will have a profoundly bad effect on the very businesses that would otherwise benefit from such an extension of good public transport. It is all about getting that balance right, because in Nottingham ordinary workers at many businesses, especially large ones such as Boots in my constituency, will have to pay up to £300 a year so that they can travel to work when they have no alternative but to use their car because of the inadequacies of the public transport system. Perhaps ironically, many of those workers will not be able to use the very tram that their parking levy will fund. That does not seem right or fair.

It is a question of balance. When we take all matters into consideration, bearing in mind that better public transport provides a wonderful opportunity to fuel our

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economies, we do things in the right way. It is right and proper that the Government are determined to invest in our infrastructure, as that is without doubt the best way to make progress in our economy.

6.36 pm

David Mowat (Warrington South) (Con): I, too, congratulate the Select Committee on their coherent report and I want to focus on one aspect of it, which is the issue of regional imbalances in spend and how they happen, and to give some of my thoughts on how we can avoid them. Those thoughts are about the appraisal mechanisms used in the Department for Transport and the Treasury, the approach to appraisal and the Treasury Green Book.

Let us get the facts out of the way first. Table 2 of the Committee’s report makes it clear that in the period under review—2008-09—one region received substantially more funding than any other, and that was London. In broad terms, London received about two or three times more per head than the English regions. That matters as billions of pounds of capital spend generate high-quality private sector jobs that translate, through the power of the economic multiplier, into prosperity. The effect is transformative.

I cannot be the only Member of the House who thinks that it is odd that under the previous Government, in 2009, the discrepancy in gross value added per head between London and the English regions doubled at a time when that capital spending was being poured into London. That discrepancy by a factor of two between the capital city and other parts of the country does not exist in any other European country; it is unique to Britain.

I had hoped that after the election we would get all that sorted out with the new Government, and I was confident that serious attempts would be made to use the power of capital spending to fix the north-south divide. I was disappointed, like others who have already spoken, to see that in the autumn statement 84% of the £30 billion accelerated capital spend was allocated to London. Let me put it in context: that is £2,731 per head in London compared with £150 per head in my region, the north-west, and £5 per head in the north-east. I have heard Ministers talk about and challenge those figures and I would like the Minister to address that specific point.

The difference in spend is partly but not entirely to do with Crossrail, Thameslink and the underground, but even after those projects are removed from consideration, London and the south-east still receive approximately double what is received in the north. This is very serious and makes a mockery of our attempts to use the regional growth fund, and previously the regional development agencies, to redress that balance. If we put capital spend of that quantity into one part of the country in that way, then giving £1 billion here and £1 billion there in regional spend does not make much of a difference. I am not a conspiracy theorist: I do not think that the Opposition, when they were in government, or my own Government have done that on purpose. There is a deeper issue here—a systemic bias that drives these decisions—and it is to do with the method of appraisal.

As far as I can make out, the mechanism that the Department for Transport uses—the new approach to appraisal—leans heavily on a system of multiplying

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small, incremental changes by the number of people involved to generate the business case. The system specifically is not allowed to take into account wider economic benefits. The consequence of that appraisal mechanism, which has been used both by the previous Government and by this Government, is that there is a bias towards the parts of the country that are most congested and where the greatest number of people will benefit from relatively small changes in journey times to create a huge economic benefit. As a consequence of that system, resources for projects are continually allocated to one part of the country.

Ian Mearns (Gateshead) (Lab): I welcome the fact that the hon. Gentleman has brought to the House’s attention the disparities with proposed investment packages in transport. Ministers will try to argue this away but they cannot argue away the extent of the disparity when more than £2,500 per head of population is being spent in the south-east compared with just a fiver in the north-east.

David Mowat: The hon. Gentleman echoes the point I am making. Just to take the politics out of it, let me point out that broadly the same thing happened under the previous Government, so we go back to my previous point: something systemic is happening here in the way that projects are appraised within the Department for Transport. I do not believe that either the previous Labour Government or the current Government wished that to be the out-turn. Frankly, the resulting disparity is not even very good for London, because the consequence of having a mechanism that removes congestion is to enable further congestion to gravitate towards our capital city and we start all over again. Enough is enough—Ministers have to challenge the appraisal mechanism.

I have thought about how the system could work and I shall leave the Minister with my suggestion. We should allocate capital budgets by region as the starting point for where money is spent. Then we would not get the issue with the north-east getting £5 a head while London gets £2,700. I understand that one risk of such a system would be sub-optimisation and that there is a need to manage cross-regional projects, but that could be done—other organisations do things of that nature. It clearly is not satisfactory for things to carry on as they are. I would like the Minister to give his view on why the appraisal mechanisms used by the Department continue to give the answers they do.

6.43 pm

Mark Pawsey (Rugby) (Con): It is a great pleasure to follow the very thoughtful contribution of my hon. Friend the Member for Warrington South (David Mowat). It is not the first time I have followed him. I first did so 45 years ago when we were both at school in my home town of Rugby.

I am pleased that the Select Committee noted the importance of investment in the transport system as a driver for growth. As a Member for a constituency in the centre of England, where warehousing, haulage and logistics businesses are a key part of our local economy, I shall focus on the road networks and links of which they take advantage. First, let me say a few words about my role before I arrived here. I was the owner of a business involved in the distribution of catering goods

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around the midlands, and an efficient road network was vital to our operation. My business was based in Rugby, because that is my home town, but I often told people it was based there because I looked at the UK and chose Rugby as the best possible place for a distribution business. We have the M1 taking us north to Leicester, Nottingham and Derby and taking us south to Northampton, Milton Keynes and London; we have the M6 taking us west to Birmingham and the west midlands conurbation; we have the A14 taking us to the east midlands, Kettering and Corby; and we have the A46 taking us south-west to Stratford-upon-Avon and the Cotswolds. The examples I am about to provide of the importance of the road network could apply to hundreds of thousands of businesses across the UK.

My business provided a delivery service, and the measure of our performance was the number of deliveries our vehicle was able to make during the working day. The more deliveries it made, the better and more efficient my business. That was affected by the efficiency of our route planning and by how well the road network was working—by the physical layout of the roads, and the opportunities to use new roads and bypasses to avoid bottlenecks and any hold-ups that were occurring. We sold to our customers with a promise of, “Order today, delivery tomorrow,” in order to minimise stockholding. Our ability to honour that promise depended on the efficiency of the road network and we prepared our loads according to known road conditions. We would know about big contraflows and closures and we might adjust the load on a given vehicle accordingly. Having advance notice of closures and delays is important to such businesses, and I know that the DFT has improved its performance in that area. When a van was out for longer or was not able to make its deliveries, we incurred overtime payments to staff. If a customer did not receive their goods on the allocated day, we had to load the goods on to an additional vehicle at an additional cost to the business that could not be recovered from the customer.

I also employed a team of sales people who would go out and visit customers. Again, the more calls they could make the better, and the cost to my business of an expensive executive sitting in a car in a motorway traffic jam was a significant burden. Both the delivery aspect of my business and the sales team were affected by congestion, which can be caused by overrunning works, the over-zealous placement of cones, unnecessary lane closures when no work appears to be taking place and extended motorway closures after incidents. I acknowledge that the Department has undertaken work to reduce such situations, but there are still massive frustrations to the road user and effects on the efficiency of businesses.

It is important to consider the contribution that the distribution, haulage and logistics sector makes to the UK economy. It is estimated to be worth about £10.7 billion and to employ about 293,000 people. In 2009, the Road Haulage Association estimated, in giving evidence to the Transport Committee, that

“a UK-based haulier pays around £25,000 in fuel duty each year for a typical articulated HGV, amounting to some £2 billion per annum for all lorries in the UK.”

More recent calculations suggest that the industry’s annual contribution in fuel duty has risen to as much as £4.57 billion.

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The Government have announced a total of £3 billion a year of spending on new strategic road schemes up to 2015. In the current spending period, they will receive £14 billion in income while they are spending £3 billion on new road networks, so there is a massive surplus to the Exchequer that is available to the Government to spend on other services. What does the logistics industry need to help it to generate that income? It needs investment in the road network, so I am pleased that that is mentioned in recommendation 2 of the Select Committee’s report. It also needs the motorways to be kept free. Blockages and lane closures are not only frustrating but incur a substantial cost. I note that the Select Committee’s report, “Out of the jam: reducing congestion on our roads”, said that jams could cost the UK economy £24 billion a year by 2025.

This has been a very valuable debate. My constituency will benefit from the £3 billion allocated to capital spend on road networks over the next four years and we are delighted that many projects, including the one at the Catthorpe M1-M6 junction, are going ahead. All that work together will enable us to generate economic growth over the coming years.

6.49 pm

Neil Carmichael (Stroud) (Con): It is a great honour to speak in the debate, bringing up the rear, as I often do. I am a firm believer in the link between good transport infrastructure and economic development. It is critical and one does not have to go far in this country to find proof of that. As Michael Portillo notes in his excellent programme about trains, they helped to develop the south-west and other parts of Britain, and that is also true of Europe. Let us understand and accept that. The great news is that the Government accept it; that is why they are investing so much, and quite right too.

I am pleased to say that in my constituency, Stroud, £45 million is being invested in the redoubling of a critical line between Kemble and Swindon, so that we can radically cut the journey time and increase the number of trains on the track. That great news is signalling to people in and around Stroud that it is a place to do business, more business and better business. That is the kind of delivery that the Government are already providing, and I thank them for it.

My hon. Friend the Member for Rugby (Mark Pawsey) spoke about logistics, which is an important subject. I too intend to speak about logistics in the context of the supply chains for manufacturing and engineering. We have complex supply chains in this country, which are becoming more complex as the weeks and months go by because many firms are manufacturing to order and production is ever more dependent on supplies from further afield. We need good infrastructure to support a complex supply chain. Many speakers have emphasised the importance of Government working together. They do work together. The Department for Business, Innovation and Skills is focusing on supply chains, and it is good that the Department for Transport is providing the infrastructure needed to develop good supply chains, nurture and improve them.

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We have also been talking about regional development agencies. I cannot think why anyone would want to bring RDAs back, but apparently some do. The Government have moved to making sure that local authorities work together. A key aim of the Localism Act 2011 is to foster a duty to co-operate. We need that co-operation between local authorities so that they think strategically when they are planning anything to do with transport and economics. The two go hand in hand, as do the needs of local authorities when transport is considered. The LEPs have already been celebrated in the debate—again, quite right too. They too have to work together in the interests of good strategic planning.

Speaking in more general terms, we need infrastructure that works and encourages communication. That is why I am a supporter of HS2. It does not go through my constituency, but even if it went nearby, I would still support it because it is right that we start to connect our big cities. We do not need to look very far on the continent or beyond to see that good connections bring about economic growth and more economic activity, so we need to promote such investment. Crucial to infrastructure is the certainty that it gives the private sector, encouraging it to add further investment. If we have a plan that people understand and recognise is a good plan, we should also attract private investment in our transport infrastructure. That is an important feature of the case for linking economics and transport policy.

Finally, I shall say a few words about airports and ports. I note from The Economist that most people live within two hours’ drive of at least two airports, so clearly we have plenty of airports. It is important that they are flexible and able to link up the main hubs. The fact that we have so many airports is good for industry, because aviation development is an extremely important part of manufacturing and engineering. We need to make that case more forcefully.

I have a small port in my constituency, Sharpness, which handles 600,000 tonnes of bulk material. That activity brings more activity and economic investment, so I am pleased that the infrastructure which supports that port is in place. We could improve it, but the fact that we have such a port in my constituency is good news. Any other hon. Member with a port, small though it may be, should support it because it is good for business.

In summary, let us never forget that transport and economics often go together, and the Government are putting their money behind that.

6.55 pm

Lilian Greenwood (Nottingham South) (Lab): I welcome the opportunity to debate the Select Committee’s report on transport and the economy. It has given many hon. Members the chance to raise constituency concerns, which I hope the Minister will respond to when he sums up.

I was going to say that it was noticeable that almost all the speakers in the debate were MPs representing towns, cities and rural areas in the north, but then we had contributions from the hon. Members for Rugby (Mark Pawsey) and for Stroud (Neil Carmichael), which broke the flow somewhat. None the less, I am sure the Minister will want to reflect on the implications for

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Government policy of the concerns expressed by northern MPs and the fact that good transport links are demanded by the north.

The Select Committee report looks at the big picture and asks some searching questions of the Government, which the Minister must answer. At the heart of the report is the Committee’s conclusion that Ministers have failed to explain how their decisions on investment in transport will deliver the economic growth and rebalancing they say are needed. Of course that could be a failure of communication, but I think it is a failure arising from the absence of any strategy or joined-up thinking from this Government.

People throughout the country know that the biggest and most pressing problem we face is the lack of jobs and growth. There are 2.7 million people on the dole—the highest number for 17 years—representing a huge cost to the economy in benefit payments and lost tax, a huge cost to the individuals affected and their families, and a cost to their local communities, many of which, especially in the north, are all too aware of the long-term scarring effects of unemployment. The Government should have a laser-like focus on using every aspect of policy to turn things around by creating jobs, supporting industry and getting our economy moving.

Transport should have a key role to play, but time and again we have seen this Government take decisions that send us in the opposite direction. It is not just that they have cut spending too far and too fast, but that they have made the wrong choices. Labour has not opposed £6 billion of difficult and painful cuts to the transport budget—two thirds of the cuts proposed by Ministers—but we would have made different decisions about how to spend the remaining money to protect passengers and deliver the maximum benefit to our economy. Labour would have protected additional investment in the rail and road network as part of a five-point plan for growth and jobs.

Mr Leech: From what the hon. Lady has said, a Labour Government would have been forced to cut capital spending even further.

Lilian Greenwood: No, I think the hon. Gentleman misunderstands me. As I said, we have not opposed £6 billion of difficult cuts to the transport budget, whether that is capital or revenue funding, but we would have maintained a further £3 billion and we would have spent it in different ways, as I will set out.

We would have protected £500 million for road schemes vital to economic growth, providing a much-needed boost to our construction industry. We would have made sure the £435 million needed for essential road maintenance went ahead, saving the taxpayer money in the long term, according to the National Audit Office. Labour would not have cut £759 million from the rail budget; we would have put passengers first and tackled affordability. We would not have allowed the private train operating companies to boost their profits with eye-watering fare rises of up to 11% this January, 5% more than the RPI plus 1% that the Government told passengers they could expect, which means that some people are spending more on their fare to work than they do on their mortgage or rent. That is not helping to make work pay; it is just adding to the cost-of-living crisis that households are already facing.

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Labour would put working people first by taking on the vested interests. We would not have given back to train companies the right to fiddle the fare cap, so that when we said that fare rises would be limited to inflation plus 1%, the public would know that that was the maximum rise they would face at the ticket office. We would also have been able to bring forward the much-needed electrification of the midland main line that, as my hon. Friend the Member for Leicester South (Jonathan Ashworth) and my neighbour, the hon. Member for Broxtowe (Anna Soubry), who is no longer in her place, pointed out, is so important to improving connectivity between London, Northamptonshire and four of the largest cities in the country: Derby, Leicester, Sheffield and, of course, my own city of Nottingham. We would have started the electrification of the great western main line, but we would have gone right through to Swansea, rather than stop at Cardiff.

The Parliamentary Under-Secretary of State for Transport (Norman Baker): The hon. Lady is busy telling us about all these spending commitments, but she is also saying that she would make £6 billion of cuts, so will she identify where those cuts would be made?

Lilian Greenwood: I will not go through all the cuts right at this moment, but I have already said that we would not have cut £759 million from the rail budget—[ Interruption. ] Well, the Minister has put forward £528 million-worth of savings from the rail industry in his departmental plans, and we would not have opposed that. We would happily find the same efficiencies that he says he would find, such as the £245 million from Crossrail. We certainly agree that where there are efficiencies to be found, they should be found. I could go through his entire departmental budget, but that would detract somewhat from the debate. I am happy to do that another time.

Under Labour, there would not have been a £680 million cut in local transport funding, which is leading to a Beeching-style cull of our bus network. The Campaign for Better Transport estimates that one in five supported bus services have been scrapped. Whole communities have been left isolated, without access to public transport, and fares are rising on those services that remain. Under Labour, three quarters of local authorities would not be reviewing school transport provision, with many families being asked to pay more just to get their children to school. That increasing problem was rightly highlighted by the hon. Member for Staffordshire Moorlands (Karen Bradley) in her wide-ranging speech about the challenges facing her rural constituency. As my knowledge of Staffordshire Moorlands was previously limited to Alton Towers, I now know a lot more about it.