National Freight Corporation (Hansard, 12 January 1977)

§ 4. Mr. Shepherd
asked the Secretary of State for Transport whether he will make a statement on the National Freight Corporation's deficit and what his current estimates of that deficit are.

§ The Secretary of State for Transport (Mr. William Rodgers)
Yes, Sir, when my review of its financial position is complete. Meanwhile I understand that the 1976 results are likely to be much better than those of 1975.

§ Mr. Shepherd
Does the right hon. Gentleman accept that many sectors of the road haulage industry and, indeed, the country as a whole will be pleased to know that the deficit for this year will be less than the £31 million of last year? Does he accept that the remainder of the road haulage industry has to operate in a free market and has to sink or swim according to a profit or loss record? Will he take steps to remove what is, in effect, a hidden subsidy, and ensure that the National Freight Corporation eliminates its deficit?

§ Mr. Rodgers
The whole industry has problems, taking one year with another, including good years and bad years. That is the case whether we consider the private sector or the public sector. Both sectors must operate efficiently over a period. I do not think that we should condemn any industry, and certainly not 1411 the National Freight Corporation, because it has had a bad year or two. The important thing is that real progress is being made in getting rid of the deficit. Surely we should all be pleased about that.

§ Mr. Ronald Atkins
Has my right hon. Friend seen the recent figures from the West German railways which indicate a loss of £1¼ billion despite the German Government's subsidy of £2½ billion a year? I ask my right hon. Friend not to listen to the moans from the Conservative Opposition about losses made by a public transport industry that has the finest financial return in the world.

§ Mr. Rodgers
I have no intention of listening to moans. As I have said before in this House, I think we should give support to our publicly-owned industries. We should congratulate them when they do well and try to understand the problems that they face from time to time. I take my hon. Friend's point and I am grateful to him for making it. At the same time, I believe it is in the national interest, and totally commensurate with our wish to see economic growth and an effective industrial strategy, to ensure that freight should pay its way over a period.

§ Mr. Moate
Why has the National Freight Corporation to pay for the free rail travel of ex-railway employees whereas British Rail does not have to show in its accounts the cost of the free travel that is given to its employees and ex-employees?

§ Mr. Rodgers
I cannot give an answer to that supplementary question. I do not think that that item affects the general size of the Corporation's deficit.

§ Mr. Flannery
Will my right hon. Friend reconsider his answer about transport paying its way? Is it not a fact that throughout the world subsidies have to be paid to rail undertakings? Is he aware that our communities nationwide are flung into chaos if rail closes down for half a day or a day? Is not that proof that rail is paying its way? No matter what is said by Conservative Members, is it not a fact that subsidies are paid to rail throughout the world, and that at present subsidies are the only way of keeping transport going, especially the railways in our country?

§ Mr. Rodgers
With respect to my hon. Friend, I did not say that transport must pay its way. I said I took the view that over a period freight should pay its way. My hon. Friend is right in pointing out that public transport systems throughout the world are facing problems. We have a great deal to be proud of in this country.