PUBLIC SERVICE OBLIGATION GRANTS (Hansard, 4 April 1984)

§ Mr. Snape
I beg to move, That the clause be read a Second time.

§ Mr. Deputy Speaker (Mr. Harold Walker)
With this it will be convenient to take amendment No. 53, in page 29, line 3, leave out clauses 35, 36, 37 and 38.

§ Mr. Snape
The Opposition believe that the implementation of part II offers no real prospect of much needed extra investment in London's rail services. On the contrary, we feel that the Bill threatens less investment and more expense to the ratepayers. I hope that, even at this early stage, I can convince both sides of the House of this essentially simple fact, but perhaps it is only simple to me.
Under the present public service obligation arrangements, real investment in London is inadequate. During our protracted debates in Committee —I do not know whether the Minister would call them that—we dealt in some detail with that aspect of the problem. Hon. Members on both sides of the Committee referred to the contribution of the Select Committee on Transport to investment in British Rail within the London area. Indeed, we referred in Committee to the Select Committee report and specifically to paragraph 4.25, which stated: British Rail gave us a graphic and familiar description of the effects of age and under-investment on their London and South East commuter services. There had, they said, been consistent under-investment in physical facilities and the inability to make proper provision for the future. This has resulted in a lowering of standards and a reduction in the quality of service provided. …At present, the level of investment is barely sufficient to maintain existing standards, let alone provide for the improvements in quality which are essential to ensure an attractive and efficient transport system. In recent years, the GLC has taken it upon itself—quite rightly—successfully to supplement that pathetically inadequate investment in BR. Yet the only reward for the GLC is to be threatened with abolition under the legislation that we are discussing——

§ Mrs. Chalker
No.

§ Mr. Snape
For the sake of the Minister, I shall be entirely accurate. The GLC's transport function will be stripped from it under the legislation that we are discussing. The legislation to bring about its abolition will, presumably, be introduced in the none-too-distant future. I hope that that is not too pedantic for the Minister and that it provides an accurate account of the likely events to come —[Interruption.] If the hon. Member for Fulham (Mr. Stevens) wishes to stick in his sixpennorth at this point in the debate, I should be delighted to give way to him. If he does not, I should be grateful if he would be silent.
1051 The Opposition believe that the implementation of part II will put Londoners in double jeopardy. They will have to pay twice over for railway services — both as taxpayers and as ratepayers. I regret that the Secretary of State, no doubt for good reason, has left the Chamber. I wanted to entertain — if that is the right word — the House with one or two of his quotations from our deliberations in Committee. However, I shall content myself by saying that it appears that the Secretary of State agrees about double jeopardy. On Tuesday 6 March, when discussing matters similar to those now before the House, the right hon. Gentleman said: At present, the burden of subsidy for LRT services only will fall under the two-thirds ratepayers/one-third taxpayers ratio, as provided in the Bill. If several hundred million pounds' worth of railway subsidy were given to LRT and later had to be found by the Government, we do not intend that the extra money should be financed in the same two-thirds/one third proportion. That would greatly increase the burden on the ratepayer because at present the whole amount is paid by the taxpayer. One would have to take a judgment about whether some and, if so how much, should fall on the ratepayer." — [Official Report, Standing Committee B, 6 March 1984; c. 908.] Whether we should leave such a judgment to the Secretary of State is a matter for debate between both sides of the House.
The Secretary of State has tried to draw the analogy between the proposed payments and section 20 grants in other metropolitan county areas. There is an important difference, as I am sure the Minister is aware. Perhaps I should not say this as it may prejudice her future promotion prospects, but she always appears to take a more detailed interest in these matters than does the Secretary of State.
I think that the Minister will concede that section 20 grants are either clearly entered into or not, as the case may be, by elected local authorities. There is a great difference between the proposals that we are discussing and the purposes behind the new clause, and what takes place in metropolitan county areas as a result of agreements between elected local authorities and those charged with managing and operating the British railway system.
One of the reasons behind the new clause is that once again the Government in part II of the Bill appear to be dedicated to the principle of double taxation of Londoners without even single representation, which is a slight variation of the old cliché. The suspicion must be that the Government and LRT together will be understandably fearful about the consequences of imposing a large new levy on London's rate-payers. Therefore, they will attempt to curtail investment in rail services. We believe that Londoners will inevitably be paying more towards transport services in London but that rail services supported directly by the public service obligation will decline.
Having expressed my sorrow at the absence of the Secretary of State—I know it is normally regarded as only a woman's prerogative to change her mind, but perhaps I may change mine——

§ Mrs. Chalker
Tell me about it.

§ Mr. Snape
I would not dream of trying to tell the Minister of State anything. I have been trying to do so in Committee for what seems like a lifetime with a singular lack of success. I shall attempt to teach her, as gently as I always do, the error of her ways and of the Government's ways in regard to part II of the Bill.
1052 My expression of gratitude, if that is the right term, for the absence of the Secretary of State is made simply because I want to discuss the vexed question of integration which, during the Committee deliberations, was guaranteed to send him into what passes as a fury for the Secretary of State. Most of my hon. Friends would perhaps regard it as a mild fit or a foot-stamping effort, but I suppose that it passes as a fury in the sort of circles in which the Secretary of State moves.
Our concern in Committee, which has led to us tabling the new clause, was to assist the further integration of the services to which I have referred. We regard it as nonsensical to set up under the Bill a non-elected organisation to run London's transport and then to leave matters as they are for the services of British Rail. That is unlikely to be conducive to the integration of passenger transport services within the Greater London area and is likely for the financial reasons that I outlined earlier to be counterproductive.
However, it seems strange that the avowed purpose of part II of the Bill is to bring about any integration of passenger services when in every other part of the Bill it seems to be the Government's intention to allow passenger services to disintegrate in the Greater London area. As the House will be aware, the tendency is to separate bus services from underground services and also to privatise some of the services, but only the profitable ones.
The Secretary of State seems to be unsure about why the powers in part II that we are seeking to amend are necessary at all. Indeed, during the deliberations in Committee he said: I do not believe that we need these powers and I hope that they will not have to be brought into effect." — [Official Report, Standing Committee B, 6 March 1984; c. 937.] That is indeed a confession from the Secretary of State who, at least theoretically, is responsible for the promotion of legislation on behalf of his Department. For him to say that these powers are not likely to be needed is unusual even by his somewhat elastic political standards.
The new clause should appeal to the House because it is designed to save Londoners a further financial burden. There is obviously confusion in the mind of the Government about the burden that will fall on ratepayers, and I hope that the Minister of State will provide satisfactory answers to the questions that I have asked on this issue. Our view is that this part of the Bill will add to the already frightening list of additional rates that Londoners will have to pay to meet the ideological prejudices of the Government. The Conservatives are good at accusing the GLC and Labour Members of promoting our ideological prejudices, but——