HC Deb 05 November 1980 vol 991 cc1269-70
10. Mr. Michael McNair-Wilson

asked the Minister of Transport when last he discussed the financial structure of British Railways with the chairman.

Mr. Fowler

I have regular meetings with the chairman to discuss current policy issues, including finance. I met him last week and I shall meet him again in two weeks.

Mr. McNair-Wilson

Does my right hon. Friend agree that the railways are facing a crisis? Passenger takings and freight receipts are down and fares are going up, and yet British Rail is still asked to manage 11,000 miles of permanent way. Is my right hon. Friend aware that there are now 19 British Rail employees for every mile of permanent way? Is it not time that British Rail was given a new flexibility about the extent of the railway system in this country and about its freedom to reduce the gross overmanning on the railways?

Mr. Fowler

My hon. Friend is obviously right when he says that productivity must be the key to the future of British Rail. Clearly, that is the sort of policy that the chairman of British Rail, Sir Peter Parker, is putting forward. We recognise the problems of British Rail, and we have increased its external finance limit by £40 million in the current year. That decision has been welcomed by British Rail and gives it the sort of flexibility that it should have.

Mr. Booth

In his discussions with Sir Peter Parker, will the Minister give him a clear assurance that British Rail will not be required to sell any of its subsidiaries prematurely, in adverse financial conditions, to meet any part of its capital programme?

Mr. Fowler

The sale of assets must continue to be part of British Rail's programme—a policy that is agreed between us. The decision on the timing of that sale depends upon British Rail. It will have to take into account a number of factors. including its ability to live within the external finance limit. As the right hon. Gentleman knows, the holding company, which will in future incorporate these subsidiary companies, will be wholly-owned by British Rail. That policy has been welcomed by the British Railways Board.

Mr. Haselhurst

What hope can my right hon. Friend hold out for the replacement of out-of-date rolling stock which came into service shortly after the Second World War, unless something is done about the financial structure of British Rail?

Mr. Fowler

The investment that is taking place in British Rail is the investment programme, obviously revalued, that we inherited from the previous Labour Government. We have 95 HSTs either in service or authorised, and a rolling programme of 220 EMUs. It could be, and is, argued by some in British Rail that we should do more, but I hope that everyone will understand how much public money goes into the railway system.

Mr. Bagier

Is the Minister aware that the amount of public money that is spent by this country on helping its railways falls tremendously short of the levels of its competitors? Does the right hon. Gentleman agree that if the money does not come from the public purse to aid the railways to compete, it can come only from vastly increased fares, which will affect everyone who uses the railway system?

Mr. Fowler

The hon. Gentleman is wrong. That is one option, but the other is to increase the efficiency and productivity of British Rail. That is what the British Railways Board is trying to do. It has put forward a number of proposals. I understand the hon. Gentleman's close interest in the railway industry, and I hope that all those who are associated with the industry will support the chairman of the board in what he is trying to do.

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