Deficit

HC Deb 15 November 1967 vol 754 cc424-5

3. Mr. Biffen

asked the Minister of Transport what is the expected deficit of the British Railways Board for the current year; and how this compares with the latest financial year.

Mr. John Morris

The deficit is now expected to be almost £20 million higher than the 1966 deficit of £134.7 million.

Mr. Biffen

Would not the Joint Parliamentary Secretary agree that accelerating deficits of this magnitude inevitably raise the question of managerial competence of senior people in British Railways? Will he, therefore, take this occasion to remind his right hon. Friend that an early statement will be required from her on speculation concerning the future of Sir Stanley Raymond?

Mr. Morris

I am sure that my right hon. Friend will bear in mind what the hon. Member has said. The hon. Member studies these matters in some detail and should be aware that this present difference is almost entirely due to the fall in freight, which in one year amounted to almost £25 million.

Mr. Ron Lewis

Can the Parliamentary Secretary say what was the 1962 railway deficit and, in view of the fact that rail closures have saved only approximately £19 million, what efforts have been made to absorb the large cost increases since 1962?

Mr. Morris

The probable figure this year would be no higher than the figure in 1962, which was £159 million. Since that time costs totalling £110 million have been absorbed by the railways.

Sir W. Bromley-Davenport

Is this not yet another example of the failure of nationalised industries—worse service at increased cost?

Mr. Morris

The hon. and gallant Member has failed to understand what I was telling him. I was telling him that costs totalling £110 million have been absorbed by this industry since 1962.

Mr. Peter Walker

Is the Parliamentary Secretary aware that the Minister told the House only nine months ago that in her view the deficit would be £6 million less than last year? We are now told that it is £20 million more. Does he think that the fact that British Railways have been without an effective Chairman for three weeks will help or hinder the deficit?

Mr. Morris

I have set out the financial position in some detail. I have explained what is the reason for the difference from the estimates and what will in all eventuality probably happen in the course of the year in respect of the fall in freight. I have nothing to add.