§ 61. Mr. HIGHAMasked the Minister of Transport if he is satisfied that his Ministry has a full and adequate check upon expenditure, upon economical operation, and proper accountancy of the railway companies under the railway agreements; and what check existed before the Ministry of Transport was created?
§ Sir E. GEDDESFrom August, 1914, to August, 1921, the net receipts of 1913 are guaranteed to the railway companies, and the result of the Agreements is to throw upon the Government any increase in working cost. The position in regard to the check exercised over the railway expenditure prior to the formation of the Ministry of Transport is described on pp. 4–5 of Cmd. Paper 654. Since the formation of the Ministry, steps have been taken to institute a closer check upon railway expenditure in several important directions, as has been explained in the Debates on the Estimates. Further, a Departmental Committee under the chairmanship of Lord Colwyn has now been set up to consider and report, inter alia, whether, with due regard to cost, any further steps should be taken to secure that the interests of the State in reference to the Railway Agreements are adequately safeguarded. It is inadvisable that I should anticipate the report of the Committee.
As regards operating economies, I took steps at once to collect and tabulate important cost figures and efficiency data on comparable lines to those compiled in all the principal countries in the world with the object of providing a check on operation. The published results are now under consideration both by the companies and by the Ministry of Transport. They are very illuminating, and indicate many weak spots.
§ 62. Mr. HIGHAMasked the Minister of Transport if the railway companies are spending the sum of £300,000,000 a year of Government money, and have no direct interest in economy; and is that the result of the agreements made by the Government in 1914, which are continued for two years after the War?
§ Sir E. GEDDESThe financial arrangements made by the Government with the 1341 railway companies upon the outbreak of war have the effect indicated. The period, which was fixed at two years after the termination of the War, which has not yet been officially declared, has been curtailed by the Ministry of Transport Act, 1919, and now ends on the 15th August, 1921.
§ 63. Mr. HIGHAMasked the Minister of Transport whether the strike and the increased cost of living is going to adversely affect the net revenue of the railways for the current year; and is it possible to utilise the £36,000,000 which the companies had in their possession for arrears of maintenance, and so avoid the necessity for increasing fares and freight charges again?
§ Sir E. GEDDESThe coal strike, concessions to the staff consequential upon earlier agreements in regard to the principal classes, and the increased cost of living have already adversely affected the estimates of railway receipts for the current year. Any continuance or extension of strikes, and any further increase in the cost of living must result in a most serious deficiency on railway working.
A very rough estimate shows that the strike will cost the taxpayer in respect of the railway guarantee some two to three millions a week. The sum which the companies have debited to working expenses as part provision against arrears of maintenance under the financial arrangements is not available for the purpose indicated. It is part of the invested funds of the companies. As the hon. Member is aware, a Committee has been appointed to consider and report upon the agreements. It will meet shortly, and I am sending copies of his question and this reply to the Chairman.
§ Sir J. RANDLESCan the right hon. Gentleman indicate when this Report of Lord Colwyn's Committee may be expected; is it a question of weeks or months?
§ Sir E. GEDDESI cannot say when the Report may be expected, as the Committee have not met yet. They were appointed during the Vacation, but I hope it will not be very many weeks before they do report.
§ Mr. SWANAre we to understand that all the increased cost will not affect the 1342 pockets of the railways companies' shareholders?
§ Sir E. GEDDESThe increased cost, as has been stated in this House several times before, of working the railways under the agreement made with the railway companies in 1914, does not give them any direct interest in increased or decreased expenditure, so that any increased cost, in fact, falls either on the user of the railways or on the taxpayer.
§ 67. Major MOLSONasked the Minister of Transport whether the Committee recently appointed to look into railway agreements, as announced in the Press of 7th October, 1920, consisting of eight members under the chairmanship of Lord Colwyn, receive fees or entail expense on the public?
§ Sir E. GEDDESNo members of this Committee receive fees; no special expense, excepting a small sum for printing, etc., will be involved.
§ 68. Major MOLSONasked the Minister of Transport whether the legal expenses, including the fees of counsel employed by the railway companies and the railway managers' expenses, are chargeable to public funds through the amount guaranteed by the Government to rail ways under dividend funds or under any other heading?
§ Sir E. GEDDESGenerally speaking, legal expenses are a proper charge to working expenses and fall to be borne by the Government, but no general ruling can be laid down applicable to all such expenses or to every company.