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Baroness Hanham: My Lords, the Minister has not quite answered my question. Investment by private companies has been put in jeopardy by the mess surrounding Railtrack at the moment. My question is whether, in the light of what has happened since
October, the Minister is still satisfied that private sector investment will be forthcoming. Indeed, is Mr Bowker able to vouch that the money will be there?
Lord Falconer of Thoroton: My Lords, Mr Bowker, who is much more expert than myself and, with respect, the noble Baroness, has said that he believes that it is there. This is a strategic plan produced three months after 7th October 2001. So the answer is, yes, we believe that the money can come from the private sector. The money will come where there is a landscape of leadership, investment, long-term commitment and the ability to identify priorities for the system.
The noble Baroness ended by making reference to the Tube. In relation to the Tube—just as in relation to the rail network—nettles have to be grasped. As Digby Jones, the director-general of the CBI said this morning in relation to the railways, nettles are finally being grasped after the 1970s and 1980s when, to quote Mr Bowker in his report, there was "disinterest" in the railways. So the answer is that just as we are grasping nettles in relation to the railways, so we are grasping nettles in relation to the Tube with our proposals in regard to the PPP.
The noble Lord, Lord Bradshaw, in his constructive contribution, made two points which very much echo what Mr Bowker has said in the strategic plan. First, he referred to the need for an ethos of accountable delivery and high-quality service delivery in the rail industry. That comes right up front in the strategic plan and we thoroughly endorse that view. He also referred to endorsing a period of stability. Again that is reflected in what Mr Bowker has said.
The noble Lord referred to the disadvantages of short-term gain, which, again, was mentioned by Mr Bowker. He referred to the importance of training operators and engineers, as well as increasing the standard of engineering—a point that was also thoroughly endorsed by the strategic plan. He welcomed the new North-South proposal, but, rightly, referred to various planning problems, whether parliamentary or otherwise, that can lead to huge delays in relation to infrastructure projects where, although there must be proper consultation, there must not be such long delays as would put this country, people in business, and leisure travellers at a disadvantage because of the time taken. We agree with that view.
The noble Lord raised a number of issues, such as landing charges at airports. However, these are matters that can be discussed in the future. I should point out that the critical aim on which the strategic plan focuses is delivering certain specific targets—for example, a 50 per cent increase in the number of passenger kilometres, and so on—that are vital to ensure a rail system fit for the 21st century.
4.50 p.m.
Lord Berkeley: My Lords, I very much welcome the Statement and the launch of this strategic plan, which I believe to be comprehensive, forward looking and good for freight. I declare an interest as chairman of
the Rail Freight Group. When repeating the Statement, my noble and learned friend noted that the new network licensee—Railtrack's successor, which will replace the late-lamented "cash cow", as I call it—has one objective; namely, to put first the interests of rail passengers. I hope that my noble and learned friend has not forgotten the interest of rail freight customers. Perhaps he could clarify that point.I also very much welcome the announcement on the cross-Channel situation. Do I detect that the Government are at last recognising that this is an international problem that needs an international solution by governments? I hope that the Government are putting increased pressure on the French Government to take the matter seriously. My final question relates to leadership, which was mentioned by my noble and learned friend. I was most impressed by the introduction to this plan from Richard Bowker, who says in the foreword to the summary of the strategic plan:
- "I will make the case for rail and for the necessary investment. I will transform the SRA into the strong leadership team that was envisaged".
Lord Falconer of Thoroton: My Lords, the service provided by Railtrack, or its successor, should be for all rail users—that means not just passengers but also freight. The importance of freight is reflected in the 10-year plan and in the subsequent announcements. It is also reflected in the strategic plan published today. In relation to the Channel Tunnel issue, I confirm that it is an international problem and one that can be solved effectively only by international co-operation. That is the position that the Government have always adopted on the issue.
My noble friend asked whether it would be right for us to get Railtrack into its new phase as quickly as possible. Of course we should do so as quickly as possible. However, we must ensure that what emerges from this period is a firm, sustainable structure for the future of the rail industry.
Lord Marlesford: My Lords, perhaps I may focus the Minister's attention on the crucial figures in the Statement and the additional figure that he has just given to the House. The Minister said that total investment over the next 10 years will amount to £43 billion. He also said:
- "We will provide £33.5 billion of public money",
Secondly, as regards the money that is to come from the private sector, can the Minister say how much of it will be from retained earnings from the operators and/or the new Railtrack, and how much will be new investment from the City, or wherever? Further, of the new investment, can the noble and learned Lord say how much the Government plan to be loan capital and how much will be equity capital? If it is loan capital, will it, or will it not, be underwritten by the Government? If the required capital is not available from the private sector, are the Government saying that they will provide sufficient capital to meet the full investment programme over the 10 years?
Lord Falconer of Thoroton: My Lords, as far as concerns the breakdown between public and private sector funding, the basic figures are around £33.5 billion of public sector funding and an estimated £30 billion to £35 billion of private sector funding over a period of 10 years. Obviously, that will involve an increase in the rate of private sector investment over and above the current level. Therefore, we expect the level of private sector investment to increase both proportionately in real terms and from the level it is now. I am not in a position to go through the basic breakdown of how much will be loan and how will be designated otherwise. However, I can tell the House that Mr Bowker, who, as I said earlier, has worked for a considerable time in the rail industry, and the Strategic Rail Authority believe that those assumptions are realistic. Part of the vital landscape of those assumptions is a planned level of commitment by the Government over the long-term that people who make decisions about investment in the private sector will find attractive.
The Lord Bishop of Hereford: My Lords, I have three specific questions for the Minister regarding certain matters that seem to be absent from the medium-term priorities set out on page 37 of the summary of the strategic plan. Incidentally, the noble and learned Lord may like to know that I enjoyed two impeccably punctual journeys today. One was my first journey on a Virgin Voyager and the other was by SouthWest trains to Waterloo. On the latter train, the conductor variously identified himself as Sean Connery, Roger Moore and then, as the train curved round into Waterloo station and I could see that we had been signalled into Platform 10, he said, "My name is Tony Blair and, appropriately, we are coming into Number 10". He was obviously enjoying his job.
However, as far as I can see, three matters seem to be missing from the Statement. The first is any reference to future electrification, which, on environmental grounds, is highly desirable, not least on the Great Western and Midland main lines. We are in danger of having a new generation of diesel trains, instead of a new generation of electric trains. There appears to be no mention of that development.
Secondly, in freight terms, there is no mention of the track bill that is needed to accommodate freight trains on the pinchpoints, especially through the West Midlands. Thirdly, there is a mention of gauge
enhancement due for 2005 from Southampton to the West Midlands and from Felixstowe to Nuneaton, but there is no time offered at all for onward gauge enhancement to the North West, to Merseyside, to Manchester, or to Scotland. Is there no hope of any of these developments in the plan?
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