RAILWAY INDUSTRY

HC Deb 14 April 1975 vol 890 cc107-68

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Pendry]

7.13 p.m.

Mr. Timothy Raison (Aylesbury)

There are by general consent a number of subjects which receive too little attention in this House, and transport is certainly one of them. At present public spending on transport is heading towards the £2,000 million a year mark. The figure in the White Paper on public expenditure for the current year is £1,765 million. That is an enormous sum of money, which at any time would be well worth debating but there are particular reasons why we have decided to have a debate on the railways this evening.

The fact is that there is growing evidence of a very serious situation indeed on the railway side. What are the ingredients in this situation? First, by any normal standards British Railways are quietly going bankrupt. It is estimated that British Railways will cost the taxpayer about £770 million at least during the next year. Second, there is a serious lack of clear objectives in the railway service, which gives the management of British Railways an ever more difficult job. Third, as we know, pay claims are now being lodged which are clearly beyond the capacity of the industry to meet. It is said that wages alone are reaching the point when they exceed revenue from charges and fares. Fourth, there is, of course, very serious overmanning in the railway system. Fifth, as I am sure some hon. Members will point out, some of the services, the commuter services in particular, face extremely grim conditions. Those conditions, which are bad enough when the services are running so-called normally, are, of course, being repeatedly aggravated by quite unnecessary industrial disputes.

I do not intend to be polemical in approaching the debate. We do not propose to divide the House at the end of the debate. I acknowledge perfectly well that any Government in power today would have to face up to these very serious problems. Therefore, I shall not make a swingeing attack on the Minister. Essentially, I shall concentrate on asking him some questions about the management of the services for which he is responsible.

The first thing one has to say is that under the Railways Act 1974 the Minister was given additional responsibilities. There is no doubt that he has a clear duty to look after the basic principles of our railway system, and it is he who must stop the drift which is taking place at present, either to financial disaster or to allowing the railways to become a burden on public expenditure, which is unacceptable.

If one looks at the Department of the Environment—I am glad that the Secretary of State is present—one is bound to say that there are other areas, notably housing, where every penny that can be scraped is desperately needed. This in itself is a good reason for trying to stop this ever-increasing subsidisation of the railways.

The essence of the present situation is that the railways are increasingly becoming a social service rather than a commercial undertaking. I should perhaps add that as a social service they are not actually redistributive, because the Family Expenditure Survey figures show that absolute expenditure on railway fares increases with income. Indeed, it is perhaps fairer to say that the railways bear the mark of an increasing number of industries under Socialism—that they are run not for the benefit of the public but for the benefit of those who work in them.

The Economist of 1st February pointed out the seriousness of the present situation. It said: The railways have won their battle for a major switch of resources from road to rail: they will get over £500 million from the Government in the next financial year, at 1974 prices. So although they provide only a tenth of Britain's transport, they will get more than half as much public money as is spent on the roads. This ignores the very great contribution made to the Exchequer by road traffic.

I accept, as did my right hon. Friend the Member for Yeovil (Mr. Peyton) in the previous Conservative Government, that there has to be substantial support for the railways. Clearly, they cannot pay their way as a whole. We cannot denude all the rural areas of the lifeline of public transport. We must keep the commuter services going. We must try to stimulate freight traffic on the railways where that makes sense. My right hon. Friend was absolutely right to recognise in November 1973 the need for a sustained investment programme to make these things possible. But the fear is mounting that the situation is getting completely out of hand and that the Railways Act 1974 is providing a bottomless pit of subsidies.

The first need now is for a coherent policy for transport as a whole. My right hon. Friend the Member for Yeovil, in his November 1973 statement, promised a White Paper which would set this out. Anyone with any memory of Labour Party speeches and Labour Party documents, and so on, would say that there has been a constant refrain on the Government side of the House about the need for integrated transport policy. Over and over again we have heard the cry "When will there be a White Paper?" I believe that the time has now come when we can fling that cry back to the Minister. When will there be a White Paper? When will the Secretary of State come up with some kind of coherent transport policy? At present there is no sign of this happening.

Why have we not got this? There are probably two reasons. First, I suspect that any integrated Socialist approach would be infinitely costly at a time of something approaching a public expenditure crisis. Second, I am afraid that the railways in particular would not come out well in any objective analysis of comparable forms of transport. I am afraid that the sad truth is that the basis of a move to achieve a major switch back to the railways proves to be based to a great degree on emotion rather than on logic. There are great difficulties facing the railways in providing a competitive servce.

They may be obvious, but I summarise them briefly. The first is the fact that railways have fixed routes and tend to require road journeys at either end. The second is the fact that with cars at least the passenger is also the driver and that as a result there are far smaller labour costs and problems. The third, surprisingly perhaps, is that the energy situation does not so far seem to have spelt out a real advantage for the railways. The Government's Transport and Road Research Laboratory recently issued a report suggesting that, despite everything, car ownership and use are likely to rise to the end of the century at rates not far different from those anticipated before the energy crisis arrived.

I may be wrong. It may be that there are energy advantages for the railways which have not so far been disclosed. But I ask the Minister to set out clearly what the comparative energy costs are between the different forms of transport.

Fourth, even the environmental factors are mixed. Certainly excessive road traffic in the wrong places is hell. But many of us feel that it is better to face the facts of what is happening and see that we have effective road networks to keep lorries out of town centres and villages, rather than seek to wish away the whole problem.

I repeat that I believe in a railway system. But it must be set within a reasonably objective overall approach to transport.

The railways themselves do not wish to have their position based on a sentimental approach. If one asks the management of British Railways, one finds that what they want is to be in a position to manage as a commercial operation.

That brings me to what is a crucial point. British Railways must be given a clear remit. They must know what we expect of them. That is not the case at the moment.

Looking back, the error of the 1974 Act was the abandonment of any notion of defining the subsidy element and the switch to open-ended support. I understand the reasons for it. However. I believe that in present circumstances this position is proving untenable. Whether or not the old method of defining the socially needed services in the railways was perfect may be argued. It may be that the Cooper Brothers formula was not right, and so on. It is interesting, incidentally, that the Minister said in his Second Reading speech last year The real trouble about the accounting procedures for individual grant-aided lines was not that they could not be worked out according to the Cooper Brothers formula but that in all public discussions about closure proposals the public were never prepared to accept the very large figures which were always involved". What has to be faced now is that under the present system there are signs that Exchequer support for the railways is getting out of hand, and the chief purpose of this debate is to find out what is happening and what, if anything, the Government are prepared to do about it.

Recently there have been a number of Press reports indicating that there is great concern among officials, anyway, in the Department of the Environment. There is talk of emergency plans and so on. Parliament is entitled to be told what is going on.

The 1974 Act provides a variety of forms of support for the railways. I am concerned with three of them today. First, there is the increase in borrowing powers to finance investment. Secondly, there are the compensation or subsidy provisions under Section 3. Thirdly, there are the grants for freight haulage provision.

As to the investment programme, the last Conservative Government, as I have said, recognised the need for a major investment programme as the only alternative to serious decay or cut-back. We would still like to see that going ahead, though we have to accept that public expenditure considerations must affect its rate.

I want to ask what is happening on the investment side. Specifically, what changes, if any, have there been since the public expenditure White Paper in January?

In passing, I might say that in my view the public expenditure White Paper was extremely meagre and oblique in what it said about the railways.

In the Second Reading debate on 24th June last year the Minister said: For the present year the level of investment will be that set by the last Government, as modified by the then Chancellor last December."—[Official Report. 24th June 1974; Vol. 875, c. 1010–16.] What is the position now? There seems to be some argument in the Press as to what the investment position is. May we be told?

Secondly, we have the problem of the current rate of subsidy. This is the crux of the matter. The position was summed up clearly and effectively by Mr. Colin Jones in the Financial Times of 24th February. He wrote: The most visible sign of strain is the mounting escalation of the railways' deficit. On a broadly comparable basis the total, including grants, rose from just under £80 million in 1971 to nearly £150 million in 1973 and probably to about £250 million to £300 million last year. For the present year the current esti- mate is at least £360 million. At this rate, the revenue the railways earn from fares and charges will soon be insufficient—if it is not already—to meet the weekly pay bill; the taxpayer will be paying more in subsidy than in passenger fares; the £1.5 billion that Parliament set aside last year to provide for five years of deficit financing will be exhausted in less than half the time; and, because of the squeeze on public expenditure, a rushed reappraisal of the post-1973 policy towards the railways will become unavoidable. If what he says there is true, it exposes a very serious problem. As he says, the sum of money meant to last for five years or so is being expended at a rate which indicates that three years would be an optimistic target. We are entitled to ask what the Minister proposes to do about it.

Since Mr. Jones wrote his article, there have been reports that the figure of £360 million which he gave for the current rate of subsidy, which was about £340 million in the White Paper, is now soaring towards the £500 million level. I submit that this places the Minister in a position where he must tell us.

The Minister for Transport (Mr. Frederick Mulley)

I can clear up one particular immediately. Although it is not a subsidy, under the 1974 Act there was provision for settling the historic position of the pensions fund, which this year is £97 million. The £340 million, plus the £97 million, plus the £30 million or so which comes from local authorities cause one to talk in round figures of £450 million to £500 million.

Mr. Raison

I am grateful to the right hon. Gentleman. However, I hope that he will say to what rate he expects the £340 million—the genuine subsidy—to rise if the pay claims that we face come into being.

Thirdly, we have the freight subsidy. Again, we are entitled to ask what is happening about the grants for freight haulage and about the approach initiated by my right hon. Friend the Member for Yeovil to the 100 big firms to see whether they would be interested in setting up facilities for freight services. This was an initiative which was accepted on both sides of the House, and we should like to hear from the Minister what is the position about this. At the same time, we would like to hear the current position of the Freightliner service. There are signs that it is running into very serious difficulties.

If the financial position of the railways has become critical, so has the problem of management. I am not critical of the management itself. Mr. Marsh and his colleagues are doing a good job in very difficult circumstances. But they must be allowed to make genuine commercial decisions within the overall strategy. I have a great deal of sympathy with them in their plea for greater freedom over fares and charges. Subsidising fares and charges indefinitely does not help the industry. It does not even help the social contract.

Mr. Peter Snape (West Bromwich, East)

If the hon. Gentleman disagrees with subsidising fares on British Railways or declining to allow the management to raise fares to economic levels, perhaps he will say why the last Conservative Government, with regard to the railways and to every other nationalised industry, prevented their financial management from being adequate for what appeared to many people to be purely electoral purposes.

Mr. Raison

I will tell the hon. Member. The reason is quite simple. When we were in power, we had an overall strategy for prices and incomes that was a tough strategy and that went a long way towards working. The present Government have a very loose strategy. I am not concerned to argue over the past in the sense that I am not trying to say that everything that happened in the past was perfect and everything that is happening today is imperfect. I am simply trying to say that we are faced with a very serious problem and one of its ingredients is that the people who run the railways, Mr. Marsh and his colleagues, need a greater degree of commercial freedom than they are getting. Whenever Governments try to delay increases of charges, particularly in the context of an incomes policy that allows incomes to soar ahead of prices, they aggravate the difficulties of the railway management.

The financial crisis ties up with all sorts of other important ingredients—pay, labour relations, overmanning and the grim conditions on some lines. I should like to say a word about these matters, but I shall be brief because I know that a number of hon. Members wish to speak and I do not want to hog the time.

I come first to pay. Clearly, the current pay negotiations are crucial. It is now accepted that manpower accounts for about 68 per cent, of total railway costs. These negotiations are clearly crucial to the social contract, but I shall not go into that here. They are also crucial to the railways. The Secretary of State was absolutely right when at Grimsby on 21st February he said: Any excessive wage settlements would undermine our efforts to achieve a healthy railway industry. I am sure that that was true.

I will not go into the negotiations in detail because they are under way and it would not be helpful to do so, but I am glad to note the efforts of the Trades Union Congress to point out to the railway unions the gravity of the situation. I would simply say that this is clearly a moment of tremendous importance to the railways.

It follows from that that labour relations generally are vital to the solution of the problem. The NUR has on the whole a responsible tradition, and I urge as strongly as possible that in these negotiations it should live up to it. As the Secretary of State points out, it is not only the NUR that has a responsible tradition. The union that the hon. Member for Leicester, East (Mr. Bradley) represents also has such a tradition, one is bound to say.

However, I cannot necessarily extend that compliment to ASLEF, which I believe the hon. Member for Nuneaton (Mr. Huckfield) represents, because over the past few years there have been a number of occasions when the actions of ASLEF have driven millions of innocent people to sheer despair. If it happens again, ASLEF will be helping to destroy the service that we want to keep going.

The truth is that public opinion has been driven to intense anger by some of the things that have happened on the railways, especially on the commuter lines, in the past few years. Again, I do not want to go into this in detail, but the railways will have no worthwhile future unless industrial self-discipline improves.

There was a horrifying list in the Daily Telegraph today of the disputes that have taken place in the London region. On Southern Region there were stoppages in 1973 in February, March, May, June, September, November and December and in 1974 in January, February, June, October and November. The Southern Region has only just seen the end of the signalmen's dispute, which began last October and hit the region almost weekly.

The Eastern Region—and my hon. Friend the Member for Southend, East (Sir S. McAdden) is here—has been worst hit. In 1973 it had one-day strikes followed by the drivers' and guards' work-to-rule. In 1974 there were the drivers' one-day strike and the overtime ban, which crippled services in January and February. From October onwards the signalmen halted trains in rush-hours, escalating to one-day strikes which ended last month. For the past three weeks services on both the Southern and the Eastern Regions have been cancelled, late or shortened as the railway workshop supervisors staged a work-to-rule and ban on overtime and rest-day working. This is clearly something that cannot go on indefinitely.

Overmanning is plainly of paramount importance. I do not for a moment underestimate the difficulty, especially at a time of high unemployment, but it has to be faced. In particular, I think that the Railways Board is entitled to ask the Government for real backing in facing it. There has been a good deal about this subject in the Press recently. For example, on 26th March the Daily Mail had an article by the editor of the Railway Gazette that was headlined When 7,000 men are still paid to sit doing nothing and there are 60,000 too many workers. In The Guardian of 7th April there was a piece by Dr. Richard Pryke and Mr. John Dodgson, of Liverpool University, who, I suspect, are both well known to Ministers, foreshadowing their forthcoming book on the railways problem, saying: … in spite of reductions in rail employment. BR remains badly overstaffed and the position is likely to be even worse by 1981. It still has about 7,300 former firemen who can be dispensed with, as they have been already by a number of other railways. About 6,000 men are employed as freight guards, many of whom are superfluous and travel along with the drivers and 'firemen' in the locomotives. … Where passenger trains have power doors, BR can follow the example of London Transport and dispense with the guard. It should also be possible to greatly reduce the number of drivers by, for instance, speeding up freight trains which only average 22½ miles an hour and by reducing the amount of unproductive time. At present on the London Midland drivers only spend an average of 3¾ hours on the move out of an eight-hour shift. I think that British Railways do not accept that everything in the book is accurate, and it may well not be, but it cannot be avoided that the two authors are serious academic contributors, and if the Minister has reason to believe that their statements are wrong he should tell the House tonight.

Mr. Mulley

I hope that the hon. Gentleman does not expect me to spend all my time reading books, no matter from what source, and correcting the manifold errors likely to be there. I hope that I can follow his earlier advice as to how I should conduct myself. Certainly I take no responsibility for correcting academic errors. I shall have a word to say about discussing industrial relations in newspapers.

Mr. Raison

It is up to the Minister, of course, but I do not believe that his right hon. Friend the Secretary of State will approve of his anti-literate approach. Statements in the book are serious. I am asking the Minister not to go through the book line by line and clause by clause but to address himself to the crucial problem of overmanning on the railways and to face his responsibilities.

Mr. Bob Cryer (Keighley)

Some astringent comments have been made about ASLEF. Would the hon. Gentleman accept that ASLEF has accepted many reductions in staffing against its better judgment? Would he confirm that he would oppose any manning reductions that would jeopardise the enviable safety record of British Railways?

Mr. Raison

I certainly do not think that we should have any manning reductions that would jeopardise the safety record of British Railways. I cannot accept that the record of ASLEF is impeccable. I am not making these comments in a party sense. If I were, we should be having a Division tonight. I am simply saying that by any standards there are grave problems that have to be faced by the Ministers responsible, and it is up to the Minister to tell the House what he proposes to do.

The Minister must accept that under the 1974 Act he has the ultimate responsibility for the appalling conditions that exist on some of our lines today in East and South-East London and so on. I am sure that some of my hon. Friends will be talking about those conditions later, but I hope that we shall have a serious answer on the problems that I have raised.

I do not want to be hypocritical. If we are to hold down the subsidy rate, some services are bound to be less than perfect. There is no point in pretending that we can have the best of all possible worlds. But the present policy makes efficient management impossible and overmanning has to be considered. With the money available, the emphasis must be on investment rather than open-ended subsidies.

Mr. Leslie Spriggs (St. Helens)

Is the hon. Member saying that if there were a Conservative Government their policy would be to make 60,000 men redundant?

Mr. Raison

Of course it will not happen overnight. We must have a Government who will support the Railways Board in attempting to get the matter right. Of course one cannot sack 60,000 men just like that. However, there is a good deal of natural wastage and there have been big reductions over the last two decades. That process must go on, and there is no reason to think that it should not do so.

Finally, policy must be realistic. It is no good pouring money into aspects of the service which will never attract custom so that there is nothing to spare to provide, for example, an adequate level of service to commuters.

I hope that we shall have from the Minister a frank statement of how he is approaching this intensely difficult problem.

7.40 p.m.

The Minister for Transport (Mr. Frederick Mulley)

I know that the House will join me in welcoming the hon. Member for Aylesbury (Mr. Raison) to our transport debates. I think that it is the first time he has taken part in such a debate. I certainly endorse his view that only rarely do we have an opportunity to discuss this very important aspect of our national life. and of course it also has a public expenditure relevance.

We were all impressed with the searching and responsible way in which the hon. Gentleman began his remarks. However, he got rather carried away by mention of Dr. Pryke. He gave a trailer for a book which I understand will not be available until the autumn. However, I do not propose to await that book before replying to the points to which the hon. Gentleman drew attention.

The hon. Gentleman raised some serious points, but he cannot have things both ways. He cannot criticise me and the Government for not giving the Railways Board commercial freedom and at the same time say that it is our fault that commuter trains do not run properly or that we have to deal with allegations about overmanning. Clearly there has to be a division of responsibility.

By the provisions of the 1974 legislation it is quite clear that, although greater powers were sought and although the House is entitled to more information in the new circumstances, it was not sensible for the Minister or the Department to try to run the railways. I receive advice from many quarters, academic or otherwise—and in view of what has been said about my right hon. Friend the Secretary of State being involved in academic matters, I should inform the hon. Gentleman that I had a fellowship in Cambridge and hold degrees from three universities. It can perhaps be said that I take a more objective view than the hon. Gentleman thinks.

I appreciate that the hon. Member for Aylesbury is new to this area of activity, but I hope he will not take too much notice of what he reads in newspapers, particularly when they mention allegations of overmanning. If there is one industry whose industrial relations are troubled and whose activities are bedevilled by overmanning, it is the newspaper industry. The Daily Mirror dispute in recent days illustrated this only too clearly. This is nothing new in the newspaper industry.

Fifteen years ago the commercial manager of one newspaper told me that it cost him more to get his newspaper from Fleet Street to the main line station than it cost to get that newspaper from the main line stations in London to Glasgow and other parts of the country. In those days—the situation may have changed by now—some of the newspaper workers were engaged in wrapping string around parcels of newspapers, which was a waste of time anyway because the newspapers were automatically wrapped in brown paper. Therefore, I do not think we should seek advice about overmanning from that quarter.

Since the 1974 legislation came into force at the beginning of this year, we have entered into full discussions with the Railways Board, although we have made it clear that it is the board's responsibility to run the railways and to deal with the serious points which the hon. Gentleman mentioned.

The hon. Member mentioned the subject of a White Paper. I am sure my right hon. Friend the Secretary of State for the Environment will wish to issue a White Paper as soon as that is reasonably possible. If the hon. Gentleman will examine the statement made by the right hon. Member for Yeovil (Mr. Peyton) on 28th November 1973, as the then Minister, he will realise that the right hon. Gentleman was in office for over three and a half years and did not produce a White Paper, although the matter had been mentioned on many occasions during his term of office.

Furthermore the figures given by the then Minister, following a three-year review of the railways in the form of a joint exercise by the board and the Department, were cut within a fortnight. Therefore, although I pay a proper tribute to the work undertaken by the Conservative Government, without which the 1974 Act could not have come into being, the hon. Member for Aylesbury should appreciate that the present Labour Government have had less time than did the Conservative Government to examine all the important issues which have been raised today.

The basis of the 1974 Act—a measure passed by the House without a dissenting voice—was that the railways needed large and continuing support for the whole passenger network. There is no doubt that public opinion supports the railways. It is equally clear that the running of the railways is a very expensive business. It is highly labour-intensive and nobody can expect to obtain rail services on the cheap. As we have often said, we believe it would be wrong to assume that the workers in the industry should subsidise it. If it is the national view that for economic, social and environmental reasons the railways should be kept going, clearly it is a national responsibility to find the necessary funds.

We all realise that the extent of subsidy cannot be unlimited. The hon. Member for Aylesbury was right to draw our attention to increasing costs, which in a labour-intensive industry have grown faster than in other sectors. It is likely that in the first year under the legislation the passenger system will require a grant of about £340 million on top of the £30 million from local authorities under the passenger transport executive system. We accept that this involves the Department in exercising adequate control over this expenditure without becoming involved in day-to-day management. We and the board have been working out the budget and a system of monitoring the board's expenditure so that we can have an early warning of difficulties which are likely to upset the budget outturn. It is a form of budgetary control which is familiar to industry; on the other hand, the previous system involved specific grants and, in addition, the previous Government had a non-statutory responsibility in respect of the cash shortfall at the end of the year. These two grants together in 1974 under the old system accounted for nearly £400 million.

Mr. Raison

Is the right hon. Gentleman giving the House the assurance that the figure of £340 million revenue subsidy is not likely to rise appreciably in the current year?

Mr. Mulley

No, I can give no such assurance. We are in the process of working out the system. Prolonged industrial disputes are bound to affect our calculations. Does the hon. Gentleman. with his wide contacts in industry, believe that in April any of his business friends would give similar assurances about their budgets and that they could be said to be dead on target at the end of the year? In an uncertain world one has to make provision to deal with uncertainties. However, this is the first year of a new Act, produced as a result of the review conducted by my predecessor. We shall have to see how it progresses. It is clear that the support cannot be unlimited.

On the question of commercial freedom, the board has increased its fares already by 27½ per cent. in the last year. It currently has an application before the Price Commission—I expect it will shortly be making a statement—for a further average increase of 15 per cent. in passenger fares. It has already increased freight charges to what it thinks the market will bear. As freight is not subsidised in the same way as passengers, there is a probability that freight will be "in the red" this financial year.

It is not popular to put up fares, but the board has met the needs of a great number of people by the introduction of the old-age pensioner reduced fares and the students' reduced fares during midweek and off-peak. Such provisions will add to the revenue rather than reduce it.

Another possibility is that the board should seek to reduce costs. I assure the hon. Member for Aylesbury that it is far from easy. There are many hon. Members on the Government benches who have long, first-hand experience of railway operation. It is not easy to see how large savings could be made without drastic surgery of the railways system. Measures such as chopping off the odd line here or there are not likely to produce the sum which the hon. Gentleman clearly has in mind.

We all regret the industrial disputes that have led to great difficulties for consumers and railway users generally. All railwaymen, not least the leaders of the unions, realise that as well as causing hardship disputes tend to lose business for the railways and, in the long run, affect the livelihoods of their members. The hon. Gentleman was fair and made the point that there was a longer list of disputes in 1973 than in 1974. He will know which Government were responsible in which year. However, no Government can do a lot to deal with wild-cat or unofficial strikes.

Industrial relations were poisoned during the term of the Conservative administration because the railway unions were chosen as the guinea pig or the first victim under the Industrial Relations Act. Relations are much better now, but they were a problem.

The restructuring which has recently taken place, and which rightly was given special priority, led to problems about differentials which are serious matters on the railways. These, together with the size of the settlement, are relevant considerations.

Mr. Robert Adley (Christchurch and Lymington)

rose—

Mr. Mulley

I must get on. I should have preferred not to make a speech, so that there would have been more time for other hon. Members to speak. However, the hon. Member for Aylesbury reasonably said that he thought it would be right for there to be a speech at this stage setting out the Government views. I should have preferred that there was only one Government speech. Much as I normally like to expose myself to cross-examination, I must consider hon. Members on both sides who wish to speak. I shall soon come to a conclusion.

I turn to the pay issues. Like the hon. Member for Aylesbury, I do not want to say anything that will make them more difficult. There has already been one meeting and the next is due on Friday. The Government fully support the board in seeking a settlement within the guidelines. The Government fully support the board in pointing out, as it has in very clear terms, that the amount of Government subsidy cannot be regarded as unlimited, and that if the claim rises to an unreasonable level it will present problems concerning the grant on the one hand and possibly future employment for railway workers on the other hand.

I accept that all the railway unions are being responsible. Over the past 20 or 30 years the railways have had a good record both for industrial relations and for reduction in manpower. In one of the newspapers today there were odd references to 7,000 men. One should realise that the railways have halved their manpower in less than a decade. They have a real sense of responsibility and of dedication. I hope that there will be a satisfactory outcome to the current negotiations.

The House accepts that the problems of the railways are very long-standing. I should like to hope that by the autumn I could put those problems right, but I cannot promise the House that we shall find the easy and immediate solutions that have been suggested. It is for the railway management and the Government, acting together within the new powers of the Railways Act, to settle the policies and strategies. A debate of the kind we are now having can only do good, because people outside will then realise that maintaining the railways is expensive.

What must be understood by so-called subsidy—the grant—is the difference between the railways' costs and their revenues. If it is not forthcoming, there will be no wages at the end of each week to pay the people who work. As I have said many times, especially to railway unions, there are occasions when they decide not to work when the pay is there. However, it is certain that they will not work if they are not paid.

When we talk about cutting subsidies, we have to face the fact that the money has to be found to pay the wages bill week after week because the revenues, even with the increased charges, are not likely to come anywhere near the outgoings in the foreseeable future. Therefore, we must accept that if we want to maintain a railway system of the present character and present level of services, it will be extremely expensive.

Mr. Deputy Speaker (Mr. Oscar Murton)

Mr. Speaker has asked me to point out that in the last debate nine hon. Members who spoke from the backbenches took a total of 94 minutes to make their contributions, which is an average of approximately 10 minutes each. It would be helpful to all hon. Members if the same precedent were continued during the present debate.

7.59 p.m.

Mr. Paul Channon (Southend, West)

I shall certainly do my best to keep within your 10-minute ruling, Mr. Deputy Speaker.

I agree with a certain amount of what the Minister has said; namely that the problems of the railways are long-standing, complicated and will not be resolved quickly. However, those of us who represent, as many hon. Members do, large numbers of constituents whose livelihoods depend upon their being able to travel with reasonable certainty and adequate comfort by rail will not be unduly comforted by what he has said.

In view of the time, I shall concentrate on only one point. I represent a constituency with thousands of commuters who come into London every day. I cannot recall a time when feelings have run higher than they do now. I hope that the Government will bear this factor in mind.

The Minister and my hon. Friend the Member for Aylesbury (Mr. Raison) have referred to the appalling conditions that have been experienced on British Rail over the past few years, particularly on certain commuter lines. My hon. Friend was right to point out, and the Minister was right to take up, the fact that no one pretends that these are simple problems that can be resolved by an incoming Government with a new magic potion. But the facts remain, and are relevant when considering the future of British Rail and what will happen to it in the context of the present enormous wage demand.

Not only the railwaymen and the taxpayers are concerned about the result of the pay demand. Those who are perhaps most concerned are the poor people who have to travel every day in conditions of great discomfort, and who will have to pay the increased fares to compensate for the pay increases. In the past two or three years rail fares have risen by an average of about 60 per cent. We have heard from the Minister that there is a further increase in the pipeline, and there may well have to be more increases if there are substantial pay increases.

I agree that one cannot indefinitely subsidise rail transport, that one cannot keep costs down artificially for an indefinite period. But what one must do, if one is to insist that the rail traveller pays the largest share, is to acknowledge that he is at least entitled to know that his services will arrive. In the past 18 months or two years we have seen on British Rail the ASLEF dispute, which caused appalling hardship to hundreds of thousands of people, if not millions; the more recent dispute by the signalmen; and, in the past week or two, the dispute which has caused the shortening of trains. The total result of all that is that hundreds of thousands of people have had to travel nearly every day in conditions of great hardship.

My hon. Friend the Member for Southend, East (Sir S. McAdden) does the journey and knows the lines to which I am referring perhaps better than anyone. Eastern Region has had some of the worst examples of the conditions I have described. Conditions there have probably been worse than anywhere else. More disruption and more inconvenience have been caused.

These are difficult problems, but I hope that the Government will do their utmost to see what can be done to bring back more industrial peace on British Rail. The poor commuter can do nothing about the situation. His representative in the House of Commons can do precious little. At the end of the day, it is a problem for the management of British Rail, or perhaps in the last resort for the Government. It is intolerable that the people who travel on British Rail have to face the possibility of disputes, which, let us pray, will be avoided as a result of the latest wage negotiation, and have already had to face two serious disputes this year and the ASLEF dispute not long ago.

My constituents travel to London by British Rail in their thousands. When the service works, they travel reasonably speedily. When it does not work, they spend many hours a day in uncomfortable conditions attempting to get to their work, with the knowledge that after their day's work they have to return in similar conditions.

This morning I received by chance a letter from a responsible organisation in my constituency, a letter typical of many that I have received in the past two weeks. It said: In addition to the normal situation of dirty, unheated, crowded trains, the commuter has for months now had to endure even worse conditions brought about by the industrial action of first the signalmen and then the workshop supervisors. We are told that we should not use our cars. Indeed, the taxes being levied already on petrol and those threatened for people taking their cars into London make it prohibitive to do so. There are only the trains. And they are so bad that, if animals had to travel in such conditions, there would be cries of public outrage. [Interruption.] The organisation is not saying that that is normal. It is speaking of the conditions of the past few months in the disputes. If hon. Mem- bers challenge me, perhaps they would care to accompany my hon. Friend and me.

Mr. Spriggs

Will the hon. Gentleman give way?

Mr. Channon

I shall finish my quotation from the letter, and then give way to the hon. Gentleman. The letter continues: How can men and women working in London be expected to do an efficient day's work when they have suffered in the morning and are faced with the prospect of another tortuous journey in the evening?

Mr. Spriggs

I am grateful to the hon. Gentleman for giving way, because the reference to dirty trains is not accurate. When the trains leave, they are spotless inside and out. If there is any filth in the trains, the public are responsible for it, not the railwaymen or the Railways Board.

Mr. Channon

I do not wish to make a point about dirty trains. I was quoting from a letter in which that was a small point in relation to the more important matter. The organisation concerned is complaining not about the dirt on the trains but about the shortness of the trains and the intolerable conditions in which people have to travel, almost as if they were cattle, because industrial disputes have led to the number of coaches being reduced. [Interruption.] Hon. Members should not interrupt unless they know the conditions on the line. That is the situation which has occurred in the past few months. If I am interrupted, I shall have to give chapter and verse, but I am trying to be brief.

What I am saying is the truth. Conditions are very difficult for tens of thousands of people, not only in the part of the country that I represent but in many other parts around London and in other areas where people commute into others of our cities. The problems that I am describing are serious. I hope that the Government will take them seriously, and do what they can to help.

The solution must lie in better industrial relations on British Rail. When those who are only travellers on British Rail and who are not concerned in the industry look at its organisation and the structure of its trade unions they see complexities of an almost Byzantine nature. The proliferation of disputes seems more rather than less likely. As an outsider, one wonders whether that is part of the problem.

Whatever the cause of the problem, I do not believe that if the present conditions continue for much longer the British public will be prepared to tolerate them. I hope that, whatever may be the outcome in the next few months, and whatever happens in all the other important matters affecting British Rail, everyone concerned will be conscious above all that the people who matter most are those who travel regularly on British Rail, who have many other financial and other difficulties, and who have been terrified by increased fares in the past few years. They will be terrified still more by the prospect of more fare increases, unless they have the certainty that they will be able to travel on the scheduled services without frequent industrial disputes which make their lives even more difficult than they otherwise would be.

8.8 p.m.

Mr. Leslie Huckfield (Nuneaton)

I have recently been the chairman of an independent committee financed by the magazine Socialist Commentary. The committee, which has recently submitted to my right hon. Friend the Secretary of State for the Environment a report on transport policy, was initiated by him about two years ago. I have been the chairman of this committee of academics, trade unionists and transport specialists for the past year.

The chief recommendation of my committee is that there should be a national co-ordinating body along the lines of a national transport authority, which should have the overall duty of co-ordinating and integrating basic investment and pricing policy decisions. That is why I am surprised that the hon. Member for Aylesbury (Mr. Raison) has again chosen to talk about the railways in isolation from the overall transport system. I wonder how much longer we shall go on talking in the House about just railways and not about the other parts of the transport system.

I recognise that the hon. Gentleman has a difficulty, because the Tory Party when in Government pretends to be pro-railway, but when in Opposition it pretends to be pro-road. I can understand the hon. Gentleman's difficulties in trying to match up the various obligations which the Conservative Party builds up for itself whilst in Government and in Opposition. As long as we consider separately the £500 million which may have to be paid to the railways this year and the £1,500 million net gathered in road taxation in various forms, we shall never have a transport policy.

The hon. Gentleman stands further indicted by the fact that most of the mounting losses which he decried occurred within a period of Conservative administration. He seems conveniently to ignore that after the passage of the 1968 Act and the reorganisation of railway finances, the railways made a profit in 1969 and 1970. After grants and subsidies to unremunerative social services totalling £94 million, which were specifically provided for in the 1968 Act, even in 1973 the loss was only £52 million. Those losses which the hon. Gentleman now decries built up when the Conservative Government deliberately told the Price Commission, and the Price Commission deliberately told the Railways Board, to keep fares down. If the hon. Gentleman decries the mounting railway losses, he should look at the actions of his own Conservative Government, actions taken usually for the most political of motives.

We have a problem with mounting railway losses and with the financing of the railway investment programme, but these difficulties cannot all be laid at the door of the Price Commission. Some of them have to be blamed on railway management. For example, I cannot understand how it is possible for railway management to say that no sized railway network can ever be made to pay, at the same time carefully omitting to publish the route strategy decisions on which that conclusion is based. We have been told countless times that no sized railway network can ever be made to pay but we have never seen, because they have never been published, alternative route strategies upon which that gigantic, momentous conclusion is based.

We have been presented with the 1973 interim rail strategy plan. How can the board in submitting an investment programme to the Department of the Environment calculate that the railways will be carrying less freight in 1981 than they did in 1971? Why is it that about 40 per cent. of that original investment submission would not have returned 10 per cent. on capital employed? The forecasts and prophecies made by railway management do not give railway workers much optimism or much encouragement.

Mr. Gordon A. T. Bagier (Sunderland, South)

Does not my hon. Friend agree that the forecast made by British Railways was based on estimated coal carrying before the oil crisis and before the heavy increase in the amount of coal carried?

Mr. Huckfield

That is precisely the point I want to make. Although changes have been made in the forecasts for the carriage of coal, steel and basic commodities, the railway freight strategy has still not been published. We still do not know the plans which have been made. What confidence can railway workers have in railway management in the light of the Field Reorganisation Scheme fiasco? In 1968 and 1969 and every year since, railway unions were told consistently and continuously that devolution of power along the lines of the Field Reorganisation Scheme was absolutely essential. It was so essential that the board, after spending £6 million on new buildings and £1 million on new telecommunications and computer systems and telling the unions every year that this reorganisation was intrinsic to survival suddenly, without explanation and without consultation, cancelled it all. What optimism, what confidence and what encouragement can railway workers have with railway management like that?

One is taken back to the great marshalling yard decision. Whatever became of that? One is taken back to the great decision not to equip railway wagons with air brakes but to stick to vacuum brakes, and now, much later, the brakes have all had to be changed, much more expensively, to air brakes. Look at the great Channel Tunnel fiasco. One minute British Rail management gave a figure of £120 million as the cost of the railway link to the Channel Tunnel, and six months later we were told that the cost would be £500 million. What confidence can railway workers have in a management like that?

The hon. Member for Aylesbury has gone away, presumably to take up his interest in roads. He referred to overmanning on the railways. He should remember that in 1948 the railways had a staff of 600,000, by 1963 that had been reduced to 440,000 and it is now down to 190,000, excluding the workshops figure. It is estimated to be 190,000 overall by 1981. That is the railway management's plan.

I should like to know where is this overmanning? I keep hearing about the number of trains which British Rail cannot run because they do not have the footplate staff. I keep hearing about the number of tickets that cannot be collected at night because there is no staff. I keep hearing about the number of tickets that cannot be sold because there is no staff. Where is this overmanning? Those are the facts. On the other hand, as the hon. Gentleman is new to his duties, I suspect that this is the sort of thing we can expect from yet another academic or armchair railwayman.

The hon. Gentleman does not know his facts. He should know that in the past 10 years the rate of natural wastage on the railways has been about 15 per cent. per annum. He should know that even to maintain its present complement of staff the railways would have to recruit about 30,000 new men every year.

I speak as the parliamentary spokesman for the Associated Society of Locomotive Engineers and Firemen. The hon. Members for Aylesbury indulges in the time-worn sport of ASLEF-bashing, conveniently forgetting that between 1955 and 1972 ASLEF was involved in no official dispute, and forgetting that from 1968 the footplatemen had been promised restructuring of their pay but the Railways Board would not talk. I do not want to start any inter-union rivalry, but it is interesting to note that when the workshop supervisors took action a couple of weeks ago, even while that action was taking place the Railways Board talked to the men. If the Railways Board had been as anxious to talk to the footplatemen, some of their working to rule might have been avoided. That was not a strike; it was a working to rule—another example of the fallacy of the overmanning which has been referred to.

Why was it that in 1972 and 1973 when the working to rule was taking place British Railways Board could not talk to ASLEF? What is sauce for the goose is sauce for the gander. If we talk to one union we should be able to talk to another. However when we have certain senior sections of railway management saying almost publicly that they hoped that the ASLEF work-to-rule would smash ASLEF, is it to be believed that those senior sections of British Rail management would like to see industrial peace on the railway?

I understand that railway negotiations are taking place at present and I would not like to prejudice them, but how can we come to a conclusion, before the negotiations have been completed, that the railway unions will obtain an increase of 30 per cent. which will smash the social contract? As far as I know the talks are still going on. As far as I know a conclusion has not been arrived at? However, almost every newspaper and many Conservative Members are talking as though the railwaymen had already obtained a 30 per cent. increase. I say that we should let the talks continue. Let us see what they produce. The railwaymen have a responsible negotiating tradition. Let us see what the negotiations produce rather than what the Press produces.

My right hon. Friend is one of the Ministers who have managed to get through the eye of the public expenditure needle. He managed to get the Railways Act on the statute book last year. Much credit is due to him for that achievement. I only hope that he manages to get the railway investment submission through as well. I believe that as a Government we should have a much more coherent railway policy. The Conservative Front Bench is right to say that the railways still do not know what is expected of them. That can still be said despite the fact that on the passenger side Government subsidies amount to more than fare revenue. Despite that, the board still does not know what its task is for the future.

I say in blunt terms to my right hon. Friend that I do not think that we have a transport policy. It is about time we had one. I am not suggesting that the report which I have submitted to the Secretary of State and to my right hon. Friend should in all respects be automatically adopted. I say that the suggestion that has been put forward for a national transport authority to try to co-ordinate all forms of transport investment and pricing policy is one which took a long time to arrive at and one which is worthy of serious consideration.

When we consider the London-Glasgow situation we see that we have a British Airways shuttle service, the National Bus Company motorway express service and the British Rail Electric Scots service. They are all competing with one another. That kind of competition is not desirable, particularly in terms of energy saving and public expenditure restraint.

My committee has recommended that we should have a national transport authority which should review annually the economic, the social and the environmental costs of each mode of transport. Given that policy review, it would adjust the costs, the charges, the taxes and the levies on each mode of transport accordingly. We should also have a policy for fares and rates for freight which reflect the costs which they impose. They should reflect the costs that they impose not only upon scarce resources but upon the whole community. For far too long transport pricing and transport policy have been based upon private costs. It is about time that we had a transport policy which counted social costs in terms not only of the community as a whole but of railway workers.

8.24 p.m.

Mr. Stephen Ross (Isle of Wight)

I am grateful to be called now, Mr. Deputy Speaker, so that I may follow the hon. Member for Nuneaton (Mr. Huckfield). I have read a great part of his report and I have brought a copy into the Chamber. It is an excellent report on transport which should be read by everyone who is interested in the subject, irrespective of political affiliations. I congratulate the hon. Gentleman and his team on the work they have done. I hope very much that the Government will base part of their White Paper on some of the wider aspects of what is contained in the report.

The Liberal Party, no doubt along with other political parties, believes that we should have an integrated transport policy. It is that for which we should be aiming, but I am not qualified to say whether it is necessary to set up a national transport authority. I hope that we shall consider integrating our transport policy in regional terms. I hope we shall have more regional government. It seems that Scotland and Wales will be having their own Parliaments, with regional assemblies in England. I believe that we should integrate our transport policy in a way which will not mean setting up a huge bureaucratic body with London offices.

I find little to quarrel with in the section of the report that deals with the railways. I think that it is a fair commentary on the present situation.

Mr. Leslie Huckfield

I am grateful to the hon. Gentleman for his praise, but I hope he will not praise the report too much.

Mr. Ross

I shall try to avoid doing so. I support the call for greater worker involvement and participation in management. That is to be applauded. I hope that that involvement and participation will be introduced without delay and in a meaningful form in spite of the turn-around to which reference has been made.

The loyalty of the staff of British Rail has been stretched by some stupid decisions at top level. I suspect that management has been pretty abysmal. It seems to be too remote and cumbersome. That is something from which we are suffering generally at the moment. When we consider our national bodies, it seems that we have far too many administrators. It is time we did something about that.

My hon. Friends and I wish passionately to see British Rail succeed. It is only common sense that they should be able to do so. I congratulate British Rail on the Inter-City services from which I benefit. To travel to Southampton non-stop from London in just over an hour is a very good service. I make use of it two or three times a week. I also congratulate them on some of their fare structures, especially those for old-age pensioners and those that apply at cut rates for midweek travel. I wish that they applied in my constituency. When my constituents go to Ryde Esplanade, they are told that such services do not apply to offshore islands such as the Isle of Wight. No doubt I can do something about that.

It is a tragedy that we should have the present situation of disputes and unrest on the railways. I have mixed among railwaymen for many years. I consider that they are sensible and responsible people. What has gone wrong? Why is it that signalmen—they are probably the most responsible of all people on the railways—should have taken the action which has been so vividly described to us? I suspect that that action has resulted in part because of some feeling of unrest with the actions of management. It seems that some railwaymen do not see a future in their jobs. They want to know what the future holds for them.

One or two anomalies have been put before me recently. For instance, on arriving at Portsmouth Harbour passengers are taken on to the boats by means of a hydraulic lift. The man who operates the lift is paid £5 a week more than the man who does the same job at Ryde Esplanade. He operates the same machine but because he is a member of the National Union of Railwaymen he is paid £5 a week less. It is understandable that there is ill feeling when such anomalies exist. It seems that I can do little for the man who is employed on the hydraulic lift at Ryde.

I hope very much that the leaders of the various unions will moderate their claims if what we are told is true. I hope that a settlement will be achieved that is within the social contract and that both sides will be able to work together. It is desperately important for the future of British Rail that both sides should do so.

Whatever economies may have to be made, I hope that we will press on with electrification. This seems to be sensible. We should consider cutting back on the advanced passenger train with its attendant high costs. I am not quite sure why anyone wants to go at 150 miles an hour. When we were examining the Channel Tunnel and the connecting link, there were great problems about the noise levels. Some hon. Members may have seen the television film which dealt with the Japanese experience of some of their fast trains.

The long-term aim should be to have rail transport, passenger and freight, as the normal mode for hauls of 400 miles or more. As members of the EEC, and I trust we shall remain so, we should have an integrated European policy, ultimately with a rail-only Channel Tunnel. That is why I support those who say that we should not abandon the workings that have taken place on the tunnel so far.

I am not quite sure what the Government's policy is about further closures. I hope that there will not be any, although I know that some are pending. Whatever the Minister does, I trust he will ensure that track and buildings are maintained rather than abandoned. Why not let some of the private operators who want to operate these lines come in and do so? They have proved pretty successful up to now. There has been the example at Ilfracombe. The track is there and people have tried to purchase it. Buildings are being ruined. The sort of obstacles they are facing should be removed so that people can get on with the job.

I was chairman of a group which tried to reopen some of the lines on the Isle of Wight. I know all the complications that can arise, as they did in our negotiations with Southern Region. In the end we never got off the ground. This is quite wrong. Now we have the situation where we have an abortion of a line which finishes at Shanklin operating with 1927 stock, Piccadilly Line railway trains, pulled out of the Science Museum.

British Railways should be made to tidy up some of the buildings and railways they have abandoned. They are a scar on the countryside. Why should they be allowed to leave these buildings in their present condition? Why should they not make better use of existing assets, particularly stations? On the Continent they are places of enjoyment where people go to spend an evening. Why cannot we have the same thing here? Why must it be that Nottingham station on a Sunday afternoon is a place to be avoided at all costs? Why must Portsmouth Harbour at ten o'clock at night be such a ghastly place? Why cannot British Rail make some use of their assets? If they cannot do it, they should let someone else do so.

I make a plea to the Minister about the future of Seaspeed. This comes under the ægis of British Rail. The right hon. Gentleman will have received a letter recently from seven unions working in British Hovercraft in my constituency. This is a matter of great concern to us. Since the Channel Tunnel has been postponed or abandoned, the chance is now there to stretch the two SRN4 hovercraft run by British Rail as well, I hope, as those run by Hoverlloyd. I gather that Hoverlloyd makes substantial profit. British Railways, perhaps because of overadministration—I have had some correspondence recently with the Chairman of British Rail about this—make a substantial loss.

The right hon. Gentleman has final sanction, and I hope that he will allow me to bring a deputation to see him. We were the first country in the world with this development. It has been allowed to slip back. The United States is building 2,000-ton hovercrafts, and all that we are supplying are the skirts. Now the French, of all people, are taking over where we left off It is important that certain facts should be made known to the right hon. Gentleman. They can be provided by my deputation.

Mr. Mulley

I am always ready to meet hon. Members and deputations. However, the hon. Member must understand the great difficulties which this causes for me with the board. The board is charged with day-to-day management. Often it is not possible to provide the board with all that it might like to have. If I start telling the board that it should do this or that, I shall be getting into a situation in which, among my other occupations, I shall be running the railways. I would not mind that, but I should not like to look after my constituency and be a Minister at the same time.

Mr. Ross

I have always felt that I could run the railways—and I do not have degrees, only a few O-levels. I appreciate that this is a decision for British Rail, but there are facts which I should like the Minister to know. The deputation would understand the situation about British Rail.

I echo the plea for a consensus approach to the railways. They should not be allowed to become a political football. There must be long-term plans for them on which all sides can agree. I hope that we shall very soon have the White Paper and that we can reach an agreed basis. As the hon. Member for Nuneaton has said, the basis is in the article to which he referred.

8.34 p.m.

Mr. Peter Snape (West Bromwich, East)

As a member of the National Union of Railwaymen I welcome the opportunity to take part in this debate. Like the hon. Member for Aylesbury (Mr. Raison), I feel that we discuss transport affairs far too infrequently, and when we do we usually talk about the money which public transport loses. We do not seem to talk about railways at all.

I come first to the question of overmanning. The hon. Member for Aylesbury referred to the report published in the Daily Mail on 26th March which stated that there were 60,000 workers too many in British Rail. The report was written by Mr. Richard Hope, who is regarded as an authoritative source. He is the editor of the Railway Gazette.

I do not intend to indulge in any academic-bashing this evening, although as an ex-railwayman I have no objection to any enthusiastic amateur making a contribution to the debate on the railways. I would not object even to the hon. Member for the Isle of Wight (Mr. Ross) running the railway. Most other people have tried. Why not him? It is always a matter of consternation to railwaymen that everyone, from country people to the man who buys a cheap return to town every day, feels that he knows far more about the railway system and can run it far more efficiently than those who are paid to do so.

I shall give some statistics concerning the staffing of British Rail and overmanning. If the railway industry suffered from overmanning, we would not find men in the signals grade working an average of 12.1 hours overtime per week. That is the average figure for that grade. My hon. Friend the Member for Nuneaton (Mr. Huckfield) has ably pointed out some of the problems in running British Rail caused by the shortage of footplate men. If the footplate grades are overmanned, it is surprising that it should be necessary for footplate men to work an average of 4.2 hours overtime per week to maintain the present services. Many of those services are inadequate. The railway staff would be the first to say that they should be strengthened, that there should be additional services and that more freight should be carried.

At the beginning of the Beeching era it was said that the only way to make the railways pay was to sack 50 per cent. of the staff. The sackings have taken place. In addition, most of the facilities have been closed. Yet after 15 years we are further away from making the railways pay than we were when we embarked on the process. The railway unions—which are mostly ignored—pointed out what would be the result of the wholesale closures which took place in the Beeching era. The unions were right. The Tory Government when in office were inept at managing the finances of the nationalised industries, yet they told us which railways in Western Europe paid their way. Frequently they say that British Rail should be more like the French, the German or even the Japanese railways, yet they cannot produce one example of a foreign railway which pays for itself in purely financial terms. The railway industry can make a great contribution in social terms, although that principle has no place in Tory Party philosophy.

Mr. Mulley

My hon. Friend has made an important point. I neglected to make the point that the subsidies enjoyed by the French and Italian railways are roughly twice those which we expect to give to British Rail, while the German railways enjoy a subsidy nearly three times as great. It is difficult to make comparisons because of the writing off of interest. However, when I meet my opposite numbers at various European bodies I hear that they have the same financial problems.

Mr. Snape

I am grateful to my right hon. Friend for that helpful intervention. I trust that he will remember the generosity experienced by his continental colleagues next time the Chairman of British Rail calls on him.

The problems connected with freightliners have been mentioned. Many people have been affected by them in the past few months. I am not alone in feeling that the right means of ensuring profitability in the railway industry's affairs would be to place them under the umbrella of British Rail rather than leave them with the National Freight Corporation, which is an error perpetrated by the Transport Act 1968, a point which I hope my right hon. Friend will remember in the future.

At present the railway unions are embarking on their annual round of pay negotiations and once again Conservative Members give the appearance of knowing far more about Labour Party policy than some members of the Government. We have heard a great deal about the importance of the railway unions' pay claim to the social contract. Hon. Members opposite may be interested to hear some evidence offered recently by the General Secretary of the National Union of Railwaymen in pursuit of the current pay claim.

Among the points raised under the social contract by Mr. Sydney Weighell, General Secretary of the National Union of Railwaymen, were, first, the need to maintain living standards. I do not think that even hon. Members opposite would object to that. The second point is the need to improve the position of the lower grade workers. Hon. Members opposite might have something to say about that after all, they quoted a figure of 30 per cent. They seem to think that the attainment of a basic rate of pay of £35 a week would push the country over the precipice of bankruptcy. The next point is progress towards equal pay for women. I do not know whether Conservative Members agree with that principle of the social contract but it is in the contract anyway.

Next, there is the need to improve sick pay and holiday entitlement. Not even the best friend of British Rail would say that the sick pay scheme at the moment is over-generous to the great majority of conciliation staff employees. The next point mentioned by Mr. Weighell was the need to improve productivity and efficiency. Railwaymen themselves are interested and anxious to improve both, but it is a little difficult to do so when they have to turn traffic away for one reason or another.

My hon. Friend the Member for Nuneaton said some harsh things about the management of British Rail, and many railwaymen will agree with them. It is demoralising for railwaymen to have to say to different companies "We must turn your traffic away because we do not have the staff, the locomotives or the rolling stock, and in many cases these days we do not even have the line to carry your goods to their destination." Obviously, in such conditions the railwaymen justifiably feel extremely demoralised about the future of the industry.

I should like to say something in answer to the hon. Member for Southend, West (Mr. Channon) who, like one or two other hon. Members opposite, assured himself of a nice story in a local newspaper and then left the Chamber. He read a letter from one of his irate constituents who used the old familiar phrases about dirty coaches and people travelling like cattle. Probably the only cliché he failed to use was the reference to sandwiches tasting like blotting paper, having spent most of their lives under a glass jar.

The hon. Gentleman, like many other hon. Members opposite, wants it both ways. He wants the railways to pay, yet he wants greater investment in rolling stock on the Southend line. Does he or, indeed, does the hon. Member for Southend, East (Sir S. McAdden) think that the Southend line is the only overcrowded line in the country? Does he believe that this city is the only city in the country where commuters are forced to travel in discomfort?

Sir Stephen McAdden (Southend, East)

Some suffer more than others.

Mr. Snape

If the hon. Gentleman wishes to intervene, he is free to do so. Many commuter lines have the same problem. Are hon. Members opposite asking British Rail to invest a considerable amount of public money in rolling stock which will spend 70 per cent. of its working life waiting in a siding for the morning and evening traffic peaks? It is not the responsibility of British Rail that so many firms operate between the hours of 9 a.m. and 5 p.m.

It is an unfortunate fact of life that rolling stock has to be made available to transport workers both to and from work, but it is not used for the rest of the day. The days when British Rail could afford to have millions of pounds in capital investment tied up in sidings from morning till night are gone. I am sure that the hon. Member for Southend, East would agree with that policy, but he cannot have it both ways.

Finally, I turn to the question of staffing. It is a fact that in the peak hours all regions of British Rail, but particularly the Southern and Eastern Regions in the London area, cannot run regular booked-service passenger trains. We are back to the problem raised by the hon. Member for Aylesbury of productivity. We have locomotive and footplate men and others tied up all day doing very little other than drive peak-hour trains. It is not the fault of British Rail.

Sir S. McAdden

indicated dissent.

Mr. Snape

The hon. Gentleman may shake his head, but these are facts. They might be unpalatable in Southend, but they are facts. We cannot expect railwaymen to drive trains when there are no trains for them to drive. We cannot expect British Rail to renew rolling stock and have it standing idle in sidings. These are facts of life. If the hon. Gentleman or his hon. Friend the Member for Southend, West wishes to do anything for his constituents other than provide them with a good story in tomorrow's newspaper, he ought to be pressing British Rail to make greater investment in its commuter stock, which, I concede, has been sadly neglected for a long time.

British railwaymen are of the opinion that, through their own poor working conditions and relatively low rates of pay, for too many years they have been expected to subsidise the railway traveller. There is a different mood abroad these days. At the risk of being labelled a Marxist, a Trotskyite or any one of those other labels which Conservative Members like to hang around the neck of anyone who gives them the facts about industrial relations, I suggest that if railwaymen are expected to carry on with their present low rates of pay my right hon. Friend can start shutting down the railways next Monday.

Railwaymen are no longer prepared to work 12 or more hours a day, seven days a week, to subsidise either the commuter or the inter-city traveller. Our railwaymen are entitled to demand a wage comparable with that of other industries. They do not seek comparability, for example, with the mineworkers, despite propaganda to the contrary, but they seek comparability, rightly, with the surface workers, many of whom work alongside railwaymen in collieries. If we are saying that a British Rail shunter must accept, as he now does since the miners' pay claim, £8 a week less than a National Coal Board shunter working next to him, we are providing a recipe for even more industrial trouble in future.

The social contract is about many things, particularly justice, and Britain's railwaymen no longer want the burden of subsidising British Rail's debt through poor wages.

8.49 p.m.

Mr. Roger Moate (Faversham)

Some hon. Members have made fairly astringent criticisms of British Rail's management. I do not sympathise with the management of British Rail in many of the decisions that it has taken. However, in its defence, considering successive Acts of Parliament, White Papers and changes in investment policy that have occurred during the last 10 to 15 years, we should have a great deal of sympathy with the management of British Rail in the difficulties that it has encountered. I criticise many of the policies adopted by British Railways, but I acknowledge that it is to a large extent a shuttlecock of economic policies: it is a victim rather than a culprit. I suspect that many of British Railways' problems arise not because of management but despite the efforts of management.

I do not intend to deal with the question of overmanning at any length. The hon. Member for West Bromwich, East (Mr. Snape) and his colleagues know much more about this subject than I do. However, I cannot help making comparisons on figures which are available. Statistics which I have studied bear out the assertion that the railways made a magnificent effort over a 10-year period to reduce their total manning levels. From a total of 440,000 in 1963 the staff had been reduced to 250,000 in 1970 but since then the figure has remained constant. In the post-Beeching era there was a massive reduction in staff, but there has not been a reduction in the past four or five years.

From a recent answer given in Hansard I make a comparison —admittedly, it is the one most favourable to my case—showing that British Railways with about 11,700 route miles have a total staff on all operations, including workshops, of 268,000, whereas the French railways with a route mileage of over 22,000 have a total staff of 290,000.

Mr. Bagier

Rural mileage.

Mr. Moate

I accept that there are differences between British Railways and French railways, but there seems to be a case for saying that there is substantial overmanning on British Railways. We read that there is a large number of firemen whose services do not seem to be essential and there is a large number of guards on passenger services whose services I do not consider to be essential. We are entitled to ask whether there is not considerable scope for further manpower reduction.

Mr. Leslie Huckfield

The hon. Gentleman insists that there is a great deal of overmanning, but why is it that the railways cannot be run when the members of ASLEF work to rule but do not go on strike?

Mr. Moate

It is self-evident that when the staff withdraw their services—

Mr. Leslie Huckfield

The staff do not do that. They just do not work overtime.

Mr. Moate

I can assure the hon. Gentleman that the travelling public—commuters in particular—suffer just as much from the pestilential rule book as they suffer from a full-scale strike. There seems to be evidence of overmanning. If there is scope for a further reduction in manpower, it is as much in the interests of the railway staff as it is in the interests of the travelling public and of hon. Members opposite—the members of the railway lobby, as I will describe them—to try to bring that about without any reduction in services. It is as much in the interests of the staff as it is in the interests of the travelling public to get the most streamlined and efficient railway system that we can get.

When hon. Members seek to defend the interests of their constituents and complain about bad industrial relations and such things as dirty trains, it is depressing when hon. Members opposite, instead of trying to improve the lot of railway employees and of the travelling public, leap to the defence of the staff as though we were making a dreadful attack on the railway unions.

Mr. Dennis Skinner (Bolsover)

Surely the hon. Gentleman understands that we are bound to jump to the defence of those who must work hard for their living. Some would argue that this place is overmanned. There are over 600 in this place. It could well be that some of those 600 are doing a useful job just like many of the railway staff of whom the hon. Gentleman's complaining. It could well be also that many of those 600 have gone home.

Mr. Moate

The hon. Member for Bolsover (Mr. Skinner) has only just entered the Chamber and has made a typical offensive remark. If he is suggesting that it is only the railwaymen who work hard and that the commuters who travel to and from London do not, it is an offensive and rather pointless interjection.

Many speeches from Labour Members have given an appearance of total complacency about the present situation, and this is equally depressing. It may be that all is well, that there is no financial problem and that industrial relations are perfect. If so, it is strange that nearly every informed critic in the Press, the travelling public and Conservative Members feel that there is a sense of financial crisis and that British Railways are in trouble. However, there has been not been a suggestion by Labour Members that that is the state of affairs.

Recently Mr. Farrimond was quoted as saying that British Railways were bust and bankrupt to an extent never before known. It was only the hon. Member for West Bromwich, East who made the slightest concession to the situation when he said that the morale of employees of British Railways was low. Other Labour Members and the Minister have given the impression that the situation is not too bad.

Mr. R. E. Bean (Rochester and Chatham)

Where have you been?

Mr. Moate

We have had two years of disruption on the railways due to bad industrial relations. Recently we have had the signalmen's dispute, the strike of supervisors and the train drivers' dispute.

Mr. Cryer

The supervisors did not strike. It was a work-to-rule.

Mr. Moate

I stand corrected. All the working to rules, the go-slows, the inter-union disputes and the strikes we have had in the past few years add up to a major body blow at the railways themselves. It should be in the interests of Labour Members and their union connections to try to improve industrial relations in the railways.

The simple point is that industrial relations in British Railways are at a pretty low ebb and something has to be done about them. Commuters see the prospect of a major dispute over yet another pay claim, with the possibility—I hope it is no more than a possibility—of even further disruption. The commuter has to stand by and see this happen. He has no control over the situation whatever.

It has been suggested that British Railways are in more serious financial trouble than ever before. We have had statements that the total Government support this year could exceed £500 million and that the money that was to be allocated over a five-year period will be exhausted in half that time. This is despite the fact that the commuter is facing a massive increase in fares. I do not say that the commuter can be insulated from the true and fair costs of operating the railways. Certainly it is acceptable that the fair and true costs must be passed on to the commuter.

Mr. Bagier

True costs.

Mr. Moate

I said "fair and true". If this latest fare increase goes through, the total increase during a 12-month to 15-month period will have been about 43 per cent. to 45 per cent.—over a period when inflation would have been about half of that.

Mr. Snape

Tell us about the years before.

Mr. Moate

The commuter is a victim of these circumstances. Although true costs must be passed on, what are the true costs? There is no discipline and no constraint upon a nationalised industry of this kind. There is certainly no parliamentary control over the way this money is spent.

I deplore the fact that it is now 15 years since a Select Committee of this House investigated British Railways. In effect, there is an open-ended commitment from the Government to support the finances of British Railways. The Government do not exercise any financial displine. There is certainly no market discipline because the long-distance commuter is a captive of the railway. He has no choice but to travel by train. Now we have the phrase that he must have imposed upon him "the costs that the market will bear." He has no choice but to pay whatever is demanded. Therefore, what is happening is that the member of the travelling public is now the victim of circumstances totally beyond his control.

If there is overmanning and if there are bad industrial relations, there is no way whereby these matters can be controlled. All that the Government have to say is "We accept a 30 per cent. wage claim", and that will be passed on in almost exactly the same figure to the travelling public. We now know that the wages bill of British Railways is roughly equivalent to its revenue, so a 30 per cent. wage claim is likely to mean 30 per cent. fare increases.

Here we have a deteriorating financial situation, a record of very bad industrial relations and, apparently, an attitude of complacency on the Government benches —that things are going along quite smoothly although perhaps there might be a few troubles. Basically, however. there has been no attempt to deal with this situation. That is certainly the impression given by Labour Members.

I want to make two particular pleas. The first is that the House of Commons should try to reassert some control over British Railways finance. Second, a public inquiry should be set up into industrial relations on British Railways. That would be in the interests of every person in this country, including Labour Members who say that they are supporting the interests of the unions. British Railways finances are going out of control. The public can see that they are going out of control. The public are prepared to see reasonable financial support, as provided for under the Act of 1974, as long as they can see reasonable working conditions, good industrial relations and trains that are clean and punctual. At present, however, the situation is deteriorating, fares are escalating rapidly and industrial relations are poor. It is about time that the Government and all Labour Members saw the truth of this and tried to do something about it.

9.2 p.m.

Mr. Ronald Atkins (Preston, North)

The hon. Member for Aylesbury (Mr. Raison) spoke in a very different voice from the voices we heard in 1974 during the debate on the Railways Bill and, indeed, voices used by Conservative Members when in Government in 1973. I hope that it is not a sad retrogression of their views.

The hon. Gentleman was critical, for instance, of the railways being run as a social service. That was not the criticism last year and the year before. It is very significant that the two services that the hon. Gentleman wants to maintain most of all—I can understand this, he being the Member for Aylesbury —are rural services and the commuter services. All that Conservative Members seem to bother about are the commuter services. These are the most expensive of all the services and they are run at the greatest deficit. The hon. Member has been complaining about deficit financing, yet most of it will be required for these services. If we were to charge the true costs, there would be few commuter services left.

Mr. Raison

rose—

Mr. Atkins

It is rather remarkable that the hon. Gentleman, who is now present for the first time since the debate began to listen to a back-bench speech, wants to stop a back-bench speech. I should feel more inclined to accept an interruption if the hon. Gentleman had been present for any of the rest of the debate.

The hon. Gentleman also gives the impression that Great Britain is the odd man out and that we are the only country financing railways. In fact, we are one of the smaller contributors. As my right hon. Friend the Minister has said, we subsidise our system much less than France, Italy or Germany subsidise theirs. In France and Italy the subsidy is over £600 million a year. In Germany it is over £1,200 million a year. The hon. Gentleman will not find commuter services to be better in France—I should like him to board a commuter train to Paris—and even less so in Italy. Today, even in America, with all the advantages which American railways have of running more profitable freight services because they are long-haul, like those of the continental countries, the railways need massive State aid to keep going. A correspondent who travelled recently on the American commuter services said that if any British commuter suffered an attack of British Rail nerves the best antidote for him would be to take a trip on American commuter services. They are very much worse, and we have something for which to be thankful.

I do not suggest that the management of British Railways is all that it should be. It is still suffering from the Beeching era when the Conservative Government backed Beeching to the full and he introduced a great deal of new management more concerned with building up empires than with expanding the railways. Indeed, their chief concern was to close railway lines as quickly as they built up their administrative empires.

The demand that we switch more freight to rail is regarded as an emotional one, although it is in line with what every foreign railway is doing on the instructions of their Governments. This is one of our chief demands, and I have no doubt that the Minister sees that. It is shocking that, despite all the debate about this and despite the consensus among the various parties, we should be neglecting freight and even talking about a reduction.

The Opposition seem to imagine that there is something inherently inefficient about the rail system. It is not so. In terms of labour, energy and everything else, it is still the most efficient way to carry freight and passengers. Per unit carried, it is still the most economical means of transportation.

The disadvantage with which railways have to contend throughout the world is that the commercial road user has a cross-subsidy from the non-commercial road user and, in this country, from the Chancellor of the Exchequer because about 40 per cent. of the cars on the road are company vehicles which get tax remission. This encourages competition against British Railways.

A study undertaken by the State transport authorities in the United States some years ago at a cost of $200 million came to the conclusion that the wear and tear on the highways varied according to the weight on the axle to the fourth power. It worked out that 1,000 12-ton lorries were more damaging to the road than 160 million motor cars. This theory, which was based on practical research, has never been denied by any authoritative body.

Commercial road users are subsidised heavily by non-commercial road users, and this is probably the main reason why railways throughout the world find it very difficult to compete with road services.

I agree with the hon. Member for Aylesbury, however, that there is a need for greater investment in British Railways, although I do not understand how the hon. Gentleman can hold that view when he disagrees about the financing of the railways. The point is: what are we to do in the meantime? With services running at a deficit, should we allow them to stop, rejuvenate them, and then restart them afterwards without meeting the deficit for this period? Such a policy would be more expensive than keeping them going for a while.

I was extremely disappointed when the Channel Tunnel project was abandoned by the Government. The rail link proposed under the Channel would have done a great deal to help long-haul freight, which is the basis of freight viability. It would have enabled us to link up with the continental rail system and thereby to get the advantages of long-haul. Much more investment in and much more spending on the railways than is envisaged for next year are needed. That would enable us to use our labour more efficiently.

Let us not forget that one way in which to increase productivity on the railways is to use the services to capacity. That is very much the best way. A lot of nonsense has been talked about overmanning in the context of how much the rail force has been cut. The silly academic exercise that refers to firemen still being employed on British Railways ignores that, although they are not employed as firemen, they are employed perhaps at firemen rates, because that was one way in which to get the union to agree to reduce the work force as it has been reduced. The hon. Member for Aylesbury does not realise that in the United States, for instance, firemen are still employed in the locomotives as the result of an agreement with the unions made many years ago—although the United States was the first to use diesel locomotives. It is sometimes economic to negotiate in such a way as to ease the burden on the labour force.

In view of what has been said in recent years in the House and outside about the environment and the need to save energy and make labour more productive, everything points to the need for more investment in and greater use of the railways. If we talked less and provided more money, we should reach that objective, and I hope that we shall see a great improvement in investment in and expenditure on the railways.

9.12 p.m.

Mr. Gwynfor Evans (Carmarthen)

Transport communications are at the heart of the infrastructure problem that is fundamental to the failure to develop, in Wales at any rate, a strong and balanced economy. In Common Market jargon, Wales is a peripheral region, and although it is unusually rich in human and natural resources it provides a classic example of the economic consequences of being a peripheral region of a huge State.

A part of this situation is that in rail, road and air transport we have a system geared to the metropolitan centre. Ever since I remember, nationalists in Wales, with the support of Welsh railwaymen, have been calling for a Welsh transport board, in the hope that such a board could construct an integrated road and rail system for both freight and passengers that would be designed to serve Wales. My main plea tonight is that we may soon see this board established in Wales to match the coming of the measure of political decentralisation that we are to have.

If we had done that in the past, our economy would have been considerably stronger and our situation happier. I have no doubt that this board would have encouraged the use of our own fuel in Wales, particularly of coal-generated electricity, and that would have been a lot better for our balance of payments. Rail traffic could have been more actively developed, so easing the congestion on the roads and discouraging pollution and injury to the environment.

But no Government have attempted it. The attitude of Governments to railways in Wales has been much the same as their attitude to roads in Wales. We still have no north-south Welsh main highway. When we have pressed for that, the Government have said that there was no industry there and, therefore, no need for a road—very different from the attitude in Italy, where the Autostrada del Sole was built through the centre of Italy because there was no industry there. The attitude to railways has been very much like that, and much of our railway system has been destroyed.

In passing may I say that in the destruction of stations and so on the British Railways Board set an unhappy example to vandals in the destruction of very fine stone buildings in stations that have been closed, and that sort of thing it still going on. I wonder whether it is necessary to pull down the stations at Pontypridd, Bridgend and Neath, which are very good examples of architecture of that type in the last century. I am sure that there are better ways of spending £500,000.

The British Railways Board reduced passenger mileage in Wales from a figure of 1,500 miles in 1950 to a figure of 665 in 1970. That was done without any proof that the rail system in Wales was losing money. That may sound strange, but it is true. I published two articles on this matter in the early 1960s in a Welsh daily paper and the facts in those articles were not denied by the board. They set out figures showing that at that time the Cardiff region, which extended from Aberystwyth to Craven Arms, was making a gross profit of £13 million. Lucrative freight traffic accounted for 84 per cent. of that income.

Had there been a Welsh transport board at that time, the story would have a different and certainly a happier one than the situation today. But if it is said that we are losing money on these lines, should we not consider to a greater degree the social costs of closure? I live in a rural area, and in many Welsh rural areas unemployment has been accelerated by closures, depopulation has been caused and closures have added to congestion on our roads and discouraged the development of light industry and tourism.

The recent closure of the line from Carmarthen to Newcastle Emlyn and Lampeter is an example of that trend. That line runs through the most beautiful country and has a tremendous potential for tourism. But for that closure, Wales could have a circular rail route which would be used by tourists who like to do that sort of thing. In that way we could make excellent use of one of the loveliest lines in Wales running through large parts of central Wales. The line in that area has more than once been under the threat of complete closure.

It is no good appealing to the British Railways Board, because it has a well-tried technique of running down lines. However, the board failed to close the line in central Wales, but little effort is being made to attract custom to the line and to make journeys in Wales pleasurable. The multiple diesel units now being used are elderly, noisy, shaky, smelly and hot. The railway could be a great attraction to tourists as well as to local users, and it is true that the line is used by local people on a considerable scale. It would certainly assist if the line could be provided with better rolling stock.

I hope that better provision will be made for north-south traffic in view of the development of the Welsh National Assembly at Cardiff. It should be made possible for people to travel easily to Cardiff from areas in Gwynedd, for example, and for them to carry out business in the city and then to travel easily back home at night. It is easier for people to travel from Dyfed to London than for many people to get from parts of Wales to Cardiff. I hope that something will be done to alleviate the system in future.

British Rail must respond to the growing national consciousness in Wales in making greater use of the Welsh language, but I shall not expand on that point now.

I should like to conclude by referring to the complete lack of electrification on the Welsh railways. This is a great scandal. Even the rest of the United Kingdom railway lines are backward in this respect in comparison with other countries. Although Wales is a country which exports coal and also electricity, it has not a single mile of electrified railway. We all know that Switzerland, which has no coal, has an entirely electrified rail system, and railways in Denmark, Austria and Holland are extensively electrified. Why is it that we in Wales have not a yard of electrified railway? I am sure that a Welsh Government would not have permitted this scandal. If we had a Welsh transport board it would have fought very hard. One hopes that the Welsh Assembly and the Welsh Development Authority, which are soon to be established, will have adequate powers and finance to develop the infrastructure of Wales, with the railways playing an important part, in order to implement at last a national development plan for Wales.

The decentralising of railway transport control is needed with a powerful national elected body to tackle the problems of Wales with vigour, vision and determination.

9.21 p.m.

Sir Stephen McAdden (Southend, East)

It is an extraordinary coincidence that the right hon. and learned Member for Liverpool, Edge Hill (Sir A. Irvine) should be here tonight when we are having a debate on railways. He will recall that 25 years ago I made my maiden speech in which I advocated certain principles by which the British Railways Board should be guided in the decision which it took.

Those principles were thought to be rather revolutionary at the time. I suggested that it should be recognised that the railways' job was to conduct passengers and goods from place to place as speedily, efficiently, safely and economically as possible. The provision of jobs for railwaymen was incidental to the provision of the service. In the same way Tesco, J. Sainsbury and Lipton provide groceries for people to buy, and the provision of employment for people stocking the shelves and handing out the goods is incidental. That was thought to be revolutionary, but in my view it was rather simple. I hope that will be borne in mind in future decisions which the British Railways Board may take.

The board has forgotten that the satisfaction of the needs of its customers happens to be one of its jobs. It seems to concentrate on satisfying the needs of those who work in the industry. It is important that it should do so, but that is not its only job. Unless it satisfies the needs of those who use its services there will be no jobs for the people at present engaged in running the railways.

The position is not as immediately obvious in a nationalised industry. With an industry which is in private hands, as Labour Members well know, it is enjoyable to indulge in wage negotiations when that industry is making a profit. If an industry is making a profit one knows that one has a better chance of securing improved conditions for the people for whom one is negotiating. However, if one is negotiating with the nationalised industries there are no inhibiting conditions, because at the end of the day the taxpayer will foot the bill.

In those circumstances we require better industrial relations than we have now. My hon. Friend the Member for Southend, West (Mr. Channon) has presented a catalogue of the troubles from which we have suffered on the commuter line from Southend to London, which makes it unnecessary for me to repeat it. We have suffered tremendously, although we are the people who provide the cash to run the services as best we can and although that line happens to be profitable. We are paying not merely the economic cost of transport from Southend to London but more than the economic cost.

The hon. Member for West Bromwich, East (Mr. Snape), who laughed uproarously when my hon. Friend said that people were being treated like cattle, should travel on the line, as I do. He would know that people are being crammed into railway compartments because at peak hours when there should be a 12-set train it either does not run or is reduced to a four-set. In those circumstances 20 to 25 people travel in a carriage and there are people standing in the toilets. If that is not travelling like cattle, I do not know what is.

Mr. Snape

rose—

Sir S. McAdden

I shall not give way. The hon. Gentleman had a great deal to say, and I have only a few minutes.

Mr. Skinner

The people should have larger toilets.

Sir S. McAdden

It may be the hon. Gentleman's view that people from Southend should travel by train in bigger and better toilets. He may believe that the people of Clay Cross should do the same. Why does he not say so? If such conditions occurred at Clay Cross in his constituency, he would be the first to complain.

My hon. Friend the Member for Southend, West did not exaggerate the conditions. Day after day, peak-hour trains were cancelled and 12-sets were reduced to four-sets. People had to travel in insufferable conditions. All that was due not to any disagreement that the railwaymen had with the travelling public but to arguments between the unions. It is unfair that those conditions should occur because ASLEF or the signalmen disagree with the NUR, or because they disagree with the structural agreement and want bigger differentials.

It always amuses me about the egalitarian party which says that we should all be equal that I have never seen so many class differences as exist between the different grades of workers in the various industries in which they are engaged. There is far more class distinction between an engine driver and a porter than there is between Lord Derby and me. The unions are anxious to preserve those differentials at all costs. Why do they go through the humbug of saying "We are all equal" when they spend the best part of their time seeking to preserve the differentials?

My hon. Friend the Member for Chippenham (Mr. Awdry) on the Front Bench is becoming restive, I am sure not because he disagrees with what I am saying but because he has a speech to make. I welcome the fact that we have had an opportunity for the first time in a very long while to say a word or two about the railways. It is the first time my hon. Friend the Member for Southend, West and I have been able to say something in the House about the disgraceful conditions in which our constituents have to travel. We pay higher and higher fares for worse and worse service, because trade unions cannot agree among themselves and British Rail is incompetently run.

9.28 p.m.

Mr. Daniel Awdry (Chippenham)

Ever since I entered the House I have been a member of my party's transport committee. Therefore, I have taken part in many debates on the subject of the railways.

I say at once to the hon. Member for Nuneaton (Mr. Huckfield) that I am not anti-railway, and never have been. We on this side of the House are certainly not anti-railway.

Ali hon. Members should sympathise with those who work in the railway industry, because over the years they have had to suffer a great deal of interference by successive Governments of both political parties, with major changes in transport policy. Management is doing a good job in difficult circumstances. I pay my tribute to the Chairman, Mr. Richard Marsh, who has shown considerable flair and imagination in a challenging task. It is easy for us to criticise individual aspects of railway operations.

Mr. Snape

Or the workers.

Mr. Awdry

Hon. Members are entitled to criticise those aspects, because we represent the feelings of our constituents, but we should all recognise that an industry of the railways' size and complexity faces great and difficult problems. One which has been mentioned several times concerns long-term investment plans. The hon. Member for Preston, North (Mr. Atkins) made the point that in such an industry those plans must look ahead for many years. I believe that we need 10-year plans rather than five-year plans.

Let us take, for example, electrification, which was raised by the hon. Member for the Isle of Wight (Mr. Ross). The rate of conversion in Britain has not been high. The hon. Member for Carmarthen (Mr. Evans) said that it was even worse in Wales. In Britain, between 1968 and 1969 it averaged about 200 miles a year. With the present energy situation, more electrification is vital, and decisions must be taken now. I speak with some feeling on this because in my constituency of Chippenham there is a large Westinghouse factory which for many years has manufactured equipment for the railways. Companies like Westinghouse require firm and continuing orders so that they can keep together their specialist teams engaged on particular projects.

Of course, I realise that Governments have to cut public expenditure—no doubt we shall hear something about that tomorrow—particularly in these times of inflation. I believe that transport is a special case and that an industrial country will not be successful unless its basic transport system is modern and efficient. It is probably false economy to make major cuts in transport investment.

The second major setback which the railways have encountered—again referred to by the hon. Member for Preston, North —is the decision to abandon the Channel Tunnel. The building of the Channel Tunnel would have given a tremendous boost to the railways, in increased passenger and freight traffic. The possibility of through traffic from Glasgow to Barcelona and from Liverpool to Milan would have been very exciting, and the tunnel would have offered immense opportunities for Freightliner services from all parts of the United Kingdom to the Continent.

It is tragic for the railways that this opportunity has been thrown away. It is probably not the appropriate time to discuss the implications of the political decision to abandon the Channel Tunnel. It has not been much referred to tonight. I deplore the decision and particularly deplore the way in which the cancellation was handled by the Government. I feel bitter about it because every time the House of Commons discussed the Channel Tunnel project the ratio of those in favour was 5:2. Yet at very short notice and with the minimum of discussion the whole project was abandoned. I hope that we shall find an opportunity before long to have a major discussion and an inquest on the implications of that decision.

Further difficulties have been caused to the railways by the major changes in transport policy over the years. A major change was the Transport Bill of 1968. I served on the Standing Committee that considered the Bill. In passing, anyone who was on that Committee should have a long-service medal. It was the longest Committee stage in the history of Parliament. The present Chairman of British Railways was on the Committee.

Mr. Raison

What about the Housing Finance Bill?

Mr. Awdry

Those who served on that Committee should also have a medal.

It was a controversial Committee but on one thing we agreed, that it would be possible to make the railways pay and to get away from deficit financing. We were all very pleased after the Transport Act 1968 that for two years, 1969 and 1970, the railways actually made a profit. But by 1971 the profit became a loss, and today I very much doubt whether anyone in the House of Commons believes that there is such a thing as a viable railway network.

That is why last year, with some reservations, we supported the Railways Bill which abolished the existing subsidies for branch lines and made £1,500 million available for the general subsidy of passenger services over a period of five years. Incidentally, the Bill also wrote off £189 million capital debt, which saved British Railways about £15 million in annual interest charges. As I say, we supported the Bill, and we have not changed our tune, which to a great extent follows the thinking of the previous Conservative Government and the previous Conservative Minister. We had certain reservations, of which I will mention two.

First, we emphasised, as we do today and as my hon. Friend for Aylesbury (Mr. Raison) did in opening, that it was wrong to deal with railways in isolation. The previous Minister, my right hon. Friend the Member for Yeovil (Mr. Peyton) had promised a White Paper to deal with the whole subject of transport. During its period in opposition the Labour Party frequently called for an integrated transport policy. Yet today we have heard practically nothing from the Government of their attitude to overall transport planning. The hon. Member for Nuneaton, having complained that some of us had not stayed, has himself gone. He agreed with the need for an overall transport policy. The hon. Member for the Isle of Wight also made the same point.

It is disappointing that the Minister said nothing about an overall transport policy. He said that he had not had time to produce one. We hope that such a policy will soon appear. It is time that transport was considered as a whole. On that basis I put in a plea for the development of inland waterways. I believe that they could make a major commercial contribution to transport. At the same time the use of inland waterways would help the country deal with amenity and pollution problems. With modern equipment it would be possible to transport heavy goods traffic to and from the Continent by using canals on both sides of the Channel and by using the same vessels on the Channel. That would eliminate a great deal of labour and handling costs, apart from the many advantages that would accrue in environmental terms. I am sure that insufficient study has been given to the development of inland waterways. I hope that the Minister will refer to that matter tonight and give us a little encouragement.

The truth is that as a nation we need urgently to review all forms of transport and to produce an overall balanced policy which harmonises commercial and social needs with the needs of safety and a good environment.

A reservation that we expressed last June—and it has since become a far more serious matter—concerned industrial relations. Several hon. Members have raised the matter tonight and I do not apologise for raising it again. Last June my right hon. Friend the Leader of the Opposition said: The commuter well remembers the almost total dislocation of services last winter during the ASLEF work-to-rule when the passenger was expected to suffer, and did suffer, intolerable conditions. … Before we give this Bill a Second Reading we shall want to he assured, on behalf of the travelling public, by the Minister of Transport or the Secretary of State for Employment that there will be no repetition of those events."— [Official Report, T4th June 1974; Vol. 875, c. 1017.] I referred to industrial relations when I wound up for the Opposition on the Railways Bill last year. I also referred to the issue in Committee. When I had the temerity to refer to it in Committee in remarkably mild terms—I am a remarkably mild and moderate man—I was immediately pounced on by Labour Members. I think that they are a little oversensitive about industrial relations on the railways. I realise that it is a delicate subject and I am deliberately not trying to make political capital out of it. However, I make no apology for returning to the subject tonight.

Of course, the railways are labour intensive. I think that nearly 70 per cent. of their costs relate to wages. I believe the precise figure is 68 per cent. The increase in pay and the salary structure changes which took place in 1974 cost over £200 million. We are told that losses on the railways may reach £340 million to £350 million this year. The Minister rightly said that he did not know what the losses would be. He asked what business would know the extent of its losses so early in the year. Does he think that next year, after another pay increase, the losses will reach £700 million? That figure has been put forward seriously by many experts. It is said that losses in 1977 may be over £1,000 million. It seems that the £1,500 million, which was meant to last for five years, may well last for only three years or less. What control is there? What control does the House exercise? What control does the Minister have over this vast expenditure? He has said very little about the matter tonight. The public are entitled to be concerned about expenditure on such a scale.

We know that a new wage claim is on the table. The hon. Member for Nuneaton says that we must wait and see what the size of it is before we say anything further about it and that we must be careful about the figures. I should be surprised if the claim were not in the region of 30 per cent. A number of people have said that that sort of increase is quite possible. I believe that it will be a large claim.

Where will these matters end? Since September 1972 fares have increased for the travelling public by about 60 per cent. Presumably there will be more pressure for increases in the autumn. This will inflict some financial hardship on the travelling public who have already suffered for many months from the disruption caused first by the train drivers, then by the signalmen and recently by the workshop supervisors. The unpleasant fact is that those large increases awarded last year and meant to bring peace to the industry have brought inter-union rivalry and discontent.

I also believe that no one seriously doubts that some saving can be made on the railways by better productivity and more modern methods.

Mr. Leslie Huckfield

Where?

Mr. Awdry

I realise that the number of footplate staff has been greatly reduced since 1962. I remember trying to make the same point in last year's debate and the hon. Member for Nuneaton leapt to his feet and interrupted me. The management of the railways carried out a study six years ago and said that it expected that the total number of employees by 1974 would be 200,000. The size of the force last year was 228,000. We know that management was totally unable to carry out its plans to streamline management, reorganise the regions and boost efficiency. It had to abandon its whole scheme on which it had been working for many months in January because of the opposition.

Mr. Leslie Huckfield

Rubbish!

Mr. Awdry

That is true. Yet these problems have to be solved. Is it true —we do not seem to have discovered this during the debate—that 7,000 former firemen are still employed and are travelling in the cabs because there is no job for them?

Mr. Leslie Huckfield

We must have the truth about this. If the footplate is so overmanned, why is it that when footplate staff do not work overtime the railways grind to a halt?

Mr. Awdry

I said in Committee that the rule book needs to be looked at. I do not think that the British public understand this. I am sure that we could get better productivity. We could get freight trains to move faster than an average of 20 miles an hour. We could arrange for drivers to spend more than half their time on the move. These are detailed points. The fact remains that there are a number of firemen who are still employed but have no job to do. Why do we have freight guards who are completely superfluous and who, anyway, often travel with the driver and fireman in the cab? Do we need so many people checking tickets at the barrier particularly on Inter-City trains when the tickets are checked again during the journey by the guards?

Parliament and the public have a right to receive answers to these questions. There has been none tonight. We like the Minister but I feel that his speech was remarkably complacent. He seemed to suggest that it was a problem that we all had to face, that the railways would cost a great deal of money and that there was little—

Mr. Mulley

I tried to explain earlier that Opposition Members cannot have it both ways. They cannot criticise us for allowing the Railway Board to manage the railways and then ask us to intervene at every detailed point.

Mr. Awdry

I understand that. Both my hon. Friend the Member for Aylesbury and the Minister have said that there is no bottomless pit of money which can be used endlessly to pump finance into the railway system. I was glad that the Secretary of State for the Environment, who attended our debate briefly tonight, said recently that any excessive wage settlements in the railway industry would merely increase fares, make rail journeys less competitive and ultimately result in a smaller railway industry, with fewer jobs for railwaymen. It is a matter of the highest priority for the whole industry that the unions should understand that it is in their interests to promote a better attitude towards each other and the general public. If this debate has made any contribution to that end, it will have been thoroughly worth while.

9.45 p.m.

The Under-Secretary of State for the Environment (Mr. Neil Carmichael)

It is pleasant to follow the hon. Member for Chippenham (Mr. Awdry) again, as I did during Second Reading of the Railways Bill on 24th June 1974. We are both interested in the problems of transport, especially those of the railways.

Last June, by means of the Railways Act, we started what we hoped would be a new basis for the operation of the railway system. We accepted that the previous concept of an essentially viable passenger rail network, with subsidies for a few loss-making lines, was no longer an effective method to use and that instead the passenger network must be looked at as a whole. In so far as the cost of operating that network cannot be met through fares and charges, Government support is required. That support cannot be attributed to particular lines or services.

We further accept that passenger business forms the main core of the railway system and that the basic cost of track, signalling and the other infrastructure factors of the railways should be charged against it, leaving the freight business to bear only the cost of those parts which it uses. On that basis we expected the business to be able to break even. We also expected it to be able to contain the passenger subsidy.

As my right hon. Friend, the Minister for Transport said, the position has changed. The railways, like other businesses, have suffered from the effects of the increased costs which they have not yet been able to recover through higher fares and charges. As a result, their financial position has deteriorated. I confirm the figures given by my right hon. Friend. We expect that Government support for the passenger system in 1975 will amount to about £340 million, in addition to which grants from local authorities will contribute a further £30 million.

One of the problems which has brought the industry to its present state was undoubtedly the restraint that was imposed on the Railways Board by the previous Government. For instance, in 1973 the then Government directly restrained the board from increasing its fares to a level allowable under the provisions of the Price Code, so that increases were held to 5 per cent. on passenger fares and to about 2 per cent. on freight charges. Those increases were not sufficient to contain the on-going deficit, neither did they cover the increases in allowable costs. This is part of the greasy pole which the railways have since been trying to climb. The sums are vast—£340 million this year.

How shall we be able to contain this large requirement for financial support? My right hon. Friend spoke about passenger fare and freight increases. I shall not deal with those. There is then the question of management action to improve the efficiency of the railways and to cut out activities which give the community poor value for money.

A good deal has already been said about the British Railways management during the course of the debate. Everyone knows how to run a railway much better than those who do it. The hon. Member for Carmarthen (Mr. Evans) made the point that British Rail deliberately run down a line so that it can be closed. I know of no railwayman who wishes to close a railway line. Railwaymen lean over backwards to keep lines in operation. I have said to some senior members of the railway manage- ment that they are still running the toy railway which they ran as children. However, they do not like to see railways reduced. They are interested in railway lore and in the operation of railways. It is not my experience that British Rail try to reduce and artificially cut down on lines.

Mr. Stephen Ross

Is the hon. Gentleman aware of a publication entitled "The Great Isle of Wight Train Robbery", which is still on sale at the bookstalls? He will find therein good grounds for backing up what the hon. Member for Carmarthen (Mr. Evans) said.

Mr. Carmichael

I have read a good many railway books, but that is one I have not read. I am sure that if I discussed this point with some of the people involved I would receive a slightly different slant on the matter. I do not want to appear complacent in any way. I am aware of many of the problems and shortcomings of railway operations and, indeed, perhaps of railway management, but we must not get the matter out of perspective.

Mr. Raison

On the subject of whether the Government are complacent, may I remind the hon. Gentleman that in the Second Reading debate on 24th June the Minister said: we need to set up a control system which will provide a means by which we can monitor the grant expenditure."—[Official Report, 24th June 1974; Vol. 875, c. 1008.] Can the hon. Gentleman say whether that control system has been set up, and, if not, when it will be set up?

Mr. Carmichael

This is a complicated business. The reorganisation of the grant and the support for the railways was not an easy job, but it is going through and a control system is in course of being set up. I hope to refer to it in future debates.

The hon. Gentleman raised the question of complacency. I think we are entitled occasionally to have a slight change in emphasis from the continual complaints that one hears about the railways and to show how they have used some of their resources. The resources of the railways have been used much more intensively in the past decade than before. For instance, passenger miles and freight ton miles are at the same level as in 1965 while substantial savings have been made.

The number of locomotives has been reduced by 50 per cent. and carriages by 45 per cent. while carrying the same number of passengers and freight tons. Track mileage has been reduced by 25 per cent. Marshalling yards have been reduced by 70 per cent.; wagons by 60 per cent. This is not a bad record. The number of miles per passenger coach have increased from 290 to 420. One result of this has been the intensification of the London-Birmingham off-peak inter-city service from an hourly to an half-hourly frequency without additional vehicles.

Load factors on British Rail have increased. For example, tons per train have increased by 20 per cent., tons per wagon by 50 per cent. and freight by 70 per cent. Manpower productivity has improved. Train miles per train crew member have increased by 40 per cent. The same volume of business is now being handled with 30 per cent. less stock. I think it is true to say that only the coal mines and the railways could take this sort of reduction in such a short period. The labour force has been halved since nationalisation and there has been a reduction of about 200,000 employees since 1962. On the whole, reasonable relations have been maintained with the unions. Real improvements in pay levels and conditions have undoubtedly been achieved.

Planning, marketing and operating are now on a commercial basis and have been complemented by the introduction of market pricing. Corporate planning has been introduced, involving five-year business and corporate plans to identify strategic objects, to review long-term prospects and to fit budget and business plans within thils framework.

The safety record has been referred to. There has been only one passenger death per 130 million journeys.

Mr. Esmond Bulmer (Kidderminster)

Besides cataloguing the improvements, can the hon. Gentleman say a word about the work carried out by the Tavistock Institute on participation in the railways? Could he say whether he sees this developing in the next year or two and whether he hopes to see some development before the Secretary of State introduces any measures concerning industrial democracy?

Mr. Carmichael

As a matter of fact, I am familiar with that work. I instigated it when I was at the Ministry of Transport in the last Labour Government. I think it would require a longer discussion than the one on which we are engaged now. This is a serious matter. I hope, as do my right hon. Friend, the railways unions, and the board, that something will be done to involve people more within the railway industry, perhaps on the lines suggested by the Tavistock Institute. Even so, since then—that was five years ago—a great deal has already been done in this area, though bigger steps may have to be taken. I should like to discuss this matter with the hon. Gentleman in a separate debate.

Labour relations have been referred to a great deal in the debate. Sometimes I wondered whether the debate hinged almost totally on labour relations within the railway industry.

In view of the enormous reduction in staff on the railways over such a short time and the big upheavals which have taken place in the transport industry generally, there have inevitably been real and imagined anomalies arising from such a complex and far-reaching review. The Government regret that it has not been possible to settle all the disputes within the agreed procedures and that there has been some resort to industrial action. I appreciate and regret the inconvenience and disruption that this has caused to a large number of people. Nevertheless, it is important to understand that only a relatively small number of railwaymen were involved. The great majority have been working normally and maintaining the high standards expected of the industry. But these disputes should not be allowed to obscure the much improved climate of industrial relations on the railways generally.

The hon. Member for Aylesbury (Mr. Raison) asked about the comparative energy uses and costs of different models of transport. This is becoming a subject about which everyone is speaking.

Transport accounts for 26 per cent. of oil tonnage consumed in the United Kingdom. The estimated breakdown between different modes of transport is that rail uses 1 per cent., car and motor cycle 12½ per cent., bus and taxi 1 per cent., and goods vehicles 6½ per cent. It is not a simple comparison to work out which is the best way. Vehicle load, speed, stops, gradients, weather and so on affect fuel consumption in different modes of transport. Generally, larger transport units under fully loaded conditions are more efficient, but in most cases higher speeds consume more energy.

The broad conclusions are that substantial fuel savings can be made if passengers and freight are transferred from aircraft to land transport and if passengers are transferred from private cars to bus or rail for journeys where public vehicles can be well loaded. For freight, rail transport is more economical on fuel than road transport over the same long-distance routes under fully loaded conditions, but the scope for achieving the transfer is limited. The Government are investigating the possibilities. Reference has already been made to the 100 firms exercise and to the help which has been given under Section 8 of the 1974 Act.

The problems of the railways are longstanding and I cannot promise the House that any easy or immediate solutions will be found. It is for the railways management and the Government, acting together under the new powers given by the Railways Act 1974, to settle policies and strategies, to decide on whatever action is best suited to securing the Government's objectives of efficient and relatively economic, in the national sense, railways policy.

This has been a short debate, but many hon. Members have taken part. The fact that at this time so many hon. Members take part in a debate on the railway industry is an indication of the importance that the House places on the—

It being Ten o'clock, the motion for the Adjournment of the House lapsed, without Question put.