Bus Industry

HC Deb 12 July 1984 vol 63 cc1381-92

The Secretary of State for Transport (Mr. Nicholas Ridley)

With permission, Mr. Speaker, I should like to make a statment about the bus industry.

The Government have now completed the review of the bus industry to which I informed the House on February 14. Bus passengers and taxpayers are not being well served. Over 10 years, the cost of local bus services have risen by up to 30 per cent. in real terms. Fares have gone up by over 30 per cent. in real terms. Subsidies have risen while services and usage have declined. Rural bus services are causing serious concern. The discipline of competition in the market place can bring great increases in efficiency, and cuts in fares. This has been shown by the deregulation of coach services in 1980. If new ideas and new services are allowed to flourish, then the total public transport market can expand, with advantage to operators, workers, and, above all, passengers. It is the users of buses who should come first, and they are the less well-off members of our society. The Government's proposals are set out in a White Paper published today in the names of myself and my right hon. Friends the Secretaries of State for Scotland and for Wales. Copies are now available in the Vote Office.

We propose to introduce legislation at the earliest opportunity to remove restrictions on competition in local bus services. We shall abolish road service licensing throughout Great Britain, except for the time being in London where new arrangements have just been introduced. We attach the highest priority to maintaining standards of safety, and quality supervision of operators will continue to be tightened, with more resources devoted to the purpose.

Local authorities will be responsible for providing subsidy to socially necessary services which are not otherwise viable in a free system. They will let contracts on the basis of competitive tenders. Support for these services will thus be made specific and transparent. Concessionary fare schemes for the elderly and disabled will continue, but must be open to all operators on an equitable basis of costing.

These policies will benefit rural communities, for whom public transport links are vital. Rural passengers will benefit from competition, more flexibility and new ideas. In addition, we shall take two special measures to aid rural transport. The first is a transitional grant, paid to operators of rural services. This will last four years, reducing in equal steps from a starting level of up to £20 million. The second is a special fund of up to £1 million a year to finance innovation in rural transport. I am glad to say that this will be administered by the Development Commission in England. Similar arrangements will be made in Wales and Scotland. We shall explore ways for making wider use of services run by education, health and social service authorities and the Post Office, and simplify the law on voluntary operation of minibuses.

The structure of the bus industry must be changed to remove the dominance of very large public sector operators and to allow competitors an opportunity to enter the market. Passenger transport executives will be required to break down their operations into smaller units as separate companies. The National Bus Company will be reorganised into smaller free-standing parts, which will be transferred to the private sector. District councils who own bus operations will be required to put them at arm's length into companies, which they will still own, but to which subsidy will be provided only through tenders, and made transparent. Agreements between bus operators will be made subject to the Restrictive Trade Practices Act 1976. We will widen the opportunities for taxis and licensed hire cars by introducing new rules enabling them to carry several passengers at separate fares in certain circumstances. We shall issue consultation papers on the detailed implementation of a number of these proposals.

These changes reverse a policy of protection which has lasted for over 50 years. This straitjacket is now producing high-cost and inadequate services. The Government's proposals will give the opportunity for the many able managers in the bus industry and for others with enterprise and initiative to offer better services to the public at less cost.

Mr. John Prescott (Kingston upon Hull, East)

I wish to protest at the outset at what I know is the normal practice of providing a copy of this White Paper of 80 pages 20 hours after the press receive it.

The White Paper means nothing less than a return to a Beeching policy on the buses. The Tories chopped the railways in the 1960s and they are taking a Beeching axe to the buses in the 1980s. The Government are set on a course of destroying our nationwide regulated bus network. They are turning back to the 1920s with a free-for-all on the profitable routes, to the detriment of those who do not live in the high streets.

Where is the evidence of the need for such a radical change in the country's road transport structure? All the professional reports, including those commissioned by the Minister's own Department, have questioned his assumption that a reduction in public subsidies will lead to a better, cheaper transport system.

Is the Minister aware that the whole bus industry and the professional experts are opposed to the policy that he is advocating today? Does anyone, other than the Secretary of State, support these damaging and unjustified proposals? Is he also aware that, in his much-vaunted trial area experiments, cowboy operators with unsafe coaches have raced along the high streets of Hereford, touting for business and forcing the commissioners to act in the cause of public safety against one of them, while rural services have been reduced?

Does the Minister recall that the last Tory transport experiment, supposedly encouraging competition, saw British Coachways, which was launched amid much flag-waving by his predecessor, collapse within 12 months, leaving the public sector to pick up the pieces? That record compares most unfavourably with the proven success of Labour transport policies in the London and metropolitan council areas, which have produced more services with lower fares and more people travelling. That success is the real motivation for this vindictive measure.

Why does the Minister in the White Paper applaud the success of the National Bus Company and then reward it by proposing its privatisation and break-up into smaller units? What is to be the size of the proposed units, and what will happen to the units that remain unsold because they are unprofitable? Will he take note of the report, published this week, by the stockbrokers Grieveson Grant—not known as a Socialist group—stating that the break-up of the National Bus Company was the option likely to produce the least return for the Government? Will he pay attention to these warnings from his friends in the City, or does he intend to go down the Enterprise Oil road taken by his right hon. Friend the Secretary of State for Energy?

Will the new form of municipal and passenger transport authority bus operations receive revenue support? What conditions will he impose? How will he deal with their extra cost arising from training, administration and employee pension schemes, which are not carried by private competitors, giving them an unfair advantage in competing for contracts?

What threats are posed to the traditional cab trade especially in London by the Minister's proposals? Will he confirm that the fuel tax rebates will be available to all operators? What conditions, if any, does he have in mind to impose on revenue financial support? Why is he not guaranteeing in statute the provision of concessionary fare schemes for pensioners and disabled people, as he has in London? What estimate has he for savings at the expense of those concessionary schemes?

Will the Minister confirm that the major slump in the provision of services will be in the rural areas? Will he accept that the White Paper's reiteration of experiments such as post buses cannot provide an adequate alternative service? What is his estimate of the difference between the £20 million grant that he proposes for subsidising unprofitable rural services, and the present level of public support for such services in rural areas?

I assume that the Secretary of State will guarantee a debate before the proposals are put into legislation. What period does he allow for such debate before legislation? Will it be only the summer months before the Tory party conference, when he will go, with all the rhetoric at his command, to announce a new policy for the bus industry?

The result of this policy will be that the young, the old, the pensioners and the women who depend on public transport will end by paying higher fares for diminished services, with the burden placed yet again on those least able to bear it.

Mr. Ridley

The hon. Gentleman reacted with typical exaggerated bellicosity and with a list of questions that would cause the House to sit almost as long as it did yesterday if I tried to answer them all. He claims that the White Paper was leaked early—I have not heard that before—but he certainly has not taken the opportunity of reading it because he would have found the answers to most of his questions there. The policy is intended to expand public transport by making it cheaper, through competition in the profitable areas.

Another point that the hon. Gentleman has apparently not picked up is that, particularly in rural areas, where public transport may not be viable, there are to be refined arrangements for ensuring that subsidy continues and is directed at obtaining value for money by bringing the transport to the passengers and taking them where they want to go, rather then throwing money at the problem, as no doubt he would prefer. We have designed the proposals for the benefit not of the bus industry but of bus travellers; it is they who have suffered.

The experiment in Hereford and Worcester has been highly beneficial to passengers. There has been a 38 per cent. reduction in subsidy from the county council and a cut of up to 40 per cent. in fares, with the same network, or a better one in some areas. I have a message from the West Midlands traffic commission chairman, which says: No apparent difference discerned since Trial Area introduced in July 1981 … No extra technical problems, checks by Vehicle Examiners running as per normal, no extra disciplinary cases heard. I find it extraordinary that the hon. Gentleman should complain about the performance of stage coaches under deregulation. Those services have been smartened up, improved, made cheaper and more numerous, and have carried an immensely larger number of people in great comfort since the dead hand of regulation was removed from them.

I turn to the report that the hon. Gentleman has had from a stockbroker; it is extraordinary how the Labour party has suddenly tried to make allies in the City. Even if competition in the bus industry and privatising large parts of it result in less take for the Exchequer, provided that the result is better rural and urban transport I believe that it is a very good deal. That is what the White Paper is about. We are seeking fair competition; we shall come to the details of that later. There is no threat to the cab trade in London; indeed, there will be extra opportunities through the introduction of shared taxi facilities, which was requested. The fuel duty rebate will remain as at present and concessionary fare schemes will continue to be the responsibility of local authorities, as they have been. Indeed, the Labour party has always said that that should be so. Finally, the policy will be of benefit to bus travellers, especially in the rural areas, and to those who have had to pay the enormous and mounting subsidies, which are quite unjustified, for both rural and urban areas.

Several Hon. Members

rose——

Mr. Speaker

Order. I repeat that there is an important debate to follow this statement. However, I fully recognise the importance of the subject to hon. Gentlemen. Therefore I propose to allow questions on this subject until 5.30. If the hon. Gentlemen involved put their questions briefly, I hope to be able to call them all.

Mr. Terence Higgins (Worthing)

May I enthusiastically congratulate my right hon. Friend on his proposal to implement the ideas that were set out in the Conservative election manifesto? I reject the points made in the filibuster from the Opposition Front Bench. Is not the increase in competition likely both to improve consumer choice and reduce prices to consumers, and is not that to be welcomed? Is my right hon. Friend aware of the great sense of injustice felt by some of those who suffer on account of the arrangements for concessionary fares because of the vast disparity between small areas, because they are dealt with on a local basis and may cover a single route? Will he consider carefully whether this might not be better done on a county-wide basis so that there will not be such great disparities between small areas?

Mr. Ridley

I am grateful to my right hon. Friend for his clearly sensible and helpful reaction to an important new transport policy. During the past 10 years, the costs of big bus operators, and fares, have increased by about 30 per cent. in real terms. That shows the enormous scope for savings to be made by having more efficient units in the industry.

On my right hon. Friend's second point, I recognise the difficulties but I believe that the question whether county or district councils should arrange concessionary fares is primarily one for local government. I am sure that that is something to which the House will wish to return when it considers the legislation.

Mr. David Penhaligon (Truro)

Is the Minister aware that many of us are worried not so much about choice in rural areas, as about maintaining a bus service? Who will decide finally what is a socially necessary service? Will it be the Minister, the county authority or some Whitehall bureaucrat? The theory is that if it is the Minister, the bus service as we know it in rural parts of the country will, in effect, disappear.

Where will the £20 million come from? Is it real new money, or is it taken from the transport grant, to be allocated again afterwards? Is the Minister's attitude to public transport provision such that the savings that he may obtain through an increase in efficiency will be used to increase the scale of public transport in Britain, or does he hope that the saving will reduce the net Exchequer contribution to maintaining a fabric of service in rural and urban areas?

Mr. Ridley

I believe that the policy will bring about the maintenance not only of the hon. Gentleman's bus services but, in some cases, even some choice. It will operate in the following way. Where a service does not operate in the free market because no operator considers that running a service is viable, the county or district council may call for tenders to run a specified route or small network and will be able to accept the lowest tender so as to award a contract to that operator and subsidise him for a specified number of years. The £20 million help for rural areas during the transition to the new regime will be paid to the operators, so is new money in the sense in which the hon. Gentleman meant it. The savings will be obtained not only from an increase in the internal efficiency of bus operators but by ensuring that the transport in all parts of the country is just right to meet the needs of each area but is not excessive, which, as we all know, happens in some areas.

Mr. Colin Shepherd (Hereford)

I wish to set the record straight as regards the negative comments by the hon. Member for Kingston upon Hull, East (Mr. Prescott). The citizens of Hereford relish the transport experiments because buses arrive when they want them and go where they want them to go, and at fares that are less than half what they paid previously. Furthermore, the bus operators are nice to them. They do not wish to see any detraction from the new freedom and the service that have been achieved since the experiment began. Will my right hon. Friend also accept that people in the residential areas of Hereford will feel reassured by the lessons that have been drawn from the trial experiment when too many of the buses have jockeyed for position at the same time? There will be a welcome for the determined approach that he has set out clearly in the White Paper to bring that problem under control and thereby get the best of both worlds. May I encourage my right hon. Friend in this endeavour?

Mr. Ridley

I congratulate the county council of Hereford and Worcester on having blazed the trail to show just what this policy can do. I advise the council that in reward it will have little if any further changes or adjustments to make because of the great experience it has found in being able to operate a sensible system in this way. I add that we have strongly noted the point made by my hon. Friend about behavioural control on the road. In the White Paper he will find that there are proposals to give power to the new licensing authorities to take away an operator's licence if his drivers behave in an anti-social manner on the roads.

Mr. Martin Flannery (Sheffield, Hillsborough)

On a point of order, Mr. Speaker.

Mr. Speaker

I shall take the point of order afterwards.

Mr. Flannery

May I raise the point of order now, Mr. Speaker?

Mr. Speaker

Order. I am saying that I will take it afterwards and that it will still be relevant to this subject.

Mr. David Marshall (Glasgow, Shettleston)

The Secretary of State has announced the break-up of the National Bus Company. Will he tell us whether he intends to do the same with the Scottish Bus Group at some future date? What is his estimate of the effects of the White Paper on services operated by Strathclyde PTE? Does he not realise that the proposals in the White Paper will be to the long-term detriment of the travelling public in Strathclyde and throughout Britain?

Mr. Ridley

The hon. Gentleman will know that there is a special chapter on Scotland in the White Paper. My hon. Friend the Parliamentary Under-Secretary is present and will be giving detailed answers to questions about Scotland which any hon. Member may ask. [HON. MEMBERS: "When?"] In answer to the hon. Gentleman's question, there is no intention of making changes to the Scottish Bus Group.

Mr. Robert Adley (Christchurch)

Is my right hon. Friend aware that the account of the bus services described by the official spokesman for the Opposition as some sort of current panacea, is not one that would be recognised by my constituents? On the whole, sensible people agree that changes and innovation are badly needed in the rules and regulations for buses, which have been unchanged for so long. Nevertheless, does not my right hon. Friend agree that there is no magic panacea for public transport and will he promise to keep an open mind on the way in which the experiments are working? Finally, will he at least consider an increase of the £1 million which he mentioned as an innovation fund that presumably has to cover England, Scotland and Wales?

Mr. Ridley

The White Paper contains a large number of proposals to consult on all sorts of specific, transitional and technical issues arising out of the policy. We shall pursue those consultations fully and vigorously.

With regard to my hon. Friend's final point about the innovation grant, the Development Commission has kindly undertaken to use that £1 million in helping new operators to get into the business. It reckons that it is about the right amount that is necessary, and probably the most that it would be able to handle.

Mr. Peter Hardy (Wentworth)

The Secretary of State has given the House a great deal to think about. Obviously, a number of the contradictions in his speech will have to be considered later. However, as he confessed a commitment to lower fares, better services and the principle of public subsidy, may I, as a resident in South Yorkshire, ask him when we may expect those remarkable advantages to come to us?

Mr. Ridley

As the hon. Gentleman speaks for a south Yorkshire constituency, I advise him that there are two ways in which to lower fares. One is the way in which South Yorkshire county council has lowered them—by massive subsidies from the ratepayers. The other is the way in which I have lowered them on the air routes between London and Amsterdam—by introducing competition.

Mr. Conal Gregory (York)

I am sure that the House will welcome the statement made by my right hon. Friend in terms of de-regulation. He has rightly had his attention drawn to the Hereford and Worcester where the services have been increased and the fares reduced by up to 40 per cent. I also commend the ESCORT scheme for public rural services in East Sussex and hope that that is extended as a result of the enterprise about which my right hon. Friend spoke today. My electors are dissatisfied that the national subsidy of £923 million is spent recklessly, as my right hon. Friend said, in places such as the people's republic of south Yorkshire, and that in west Yorkshire the citizens of York must contribute £4.7 million.

Mr. Ridley

I am grateful to my hon. Friend. There are lessons to be learnt from the ESCORT project. We shall try to learn them and incorporate them.

I am also grateful to my hon. Friend for pointing out that if the cost of concessionary fares is included, the bus industry probably costs taxpayers and ratepayers slightly more than the railway industry, whereas a few years ago it was costing them hardly anything. The Government had to curtail the rapid increase in the cost to taxpayers and ratepayers if there was ever to be sense and fair competition in transport.

Mr. Nigel Spearing (Newham, South)

The Secretary of State reminded the House that this legislation will mark the end of 50 years of regulation. Will he confirm that that regulation was introduced by a Conservative Government to improve facilities for travellers at a time of rising and buoyant demand? As his new proposals are also supposed to help the travelling public, will he assure the House that if the results do not come up to his expectations, the legislation will permit re-introduction of regulation?

Mr. Ridley

The connection is even closer because when the 1930 legislation, bringing in regulation, was introduced I believe that my uncle, Euan Wallace, was Minister of Transport.

Mr. John Home Robertson (East Lothian)

Bring him back.

Mr. Ridley

I am equally sure that if we brought him back he would be one of the most enthusiastic supporters of the legislation that I propose.

Mr. John Cartwright (Woolwich)

With the spectre of rate capping hanging over local authorities, how does the Secretary of State expect them to provide subsidies for socially necessary bus services? If authorities are unable to pick up that financial burden, what will happen to those essential bus services?

Mr. Ridley

At the moment local authorities provide large sums of money which are much smaller per head of the population in the shire counties than in the metropolitan areas. They will still have their own resources to finance socially desirable services. In rural areas those resources will increase with the new grant that I announced today.

If we are to reduce overspending in metropolitan areas—that is necessary if we are to reduce the appalling burden of rates in those areas—it should be welcomed as helpful that we are showing local authorities a way of obtaining better value for money—more transport for the same money— and saving money that is being wasted by using the forces of competition and private enterprise to provide a service cheaply and properly.

Mr. John Maples (Lewisham, West)

May I tell my right hon. Friend how welcome his statement is and how welcome it will prove to be to taxpayers and passengers. Does he not agree that this is the right way to set about reducing the massive public subsidies paid for bus services? However, perhaps he can find some words of condolence for the Opposition for having slaughtered yet another of their sacred cows.

Mr. Ridley

I am sorry to have to agree with my hon. Friend that this is probably one of the last areas where a centrally planned bureaucratic service has been allowed to survive. It is the last remnant of Socialist ideology. Perhaps that is why the hon. Member for Kingston upon Hull, East (Mr. Prescott) reacted with such over-exuberance.

Mr. Roland Boyes (Houghton and Washington)

I am amazed and staggered that the Secretary of State is not aware of the high international reputation of the integrated passenger transport system in Tyne and Wear. Has the Secretary of State had an opportunity to study the report of MCP Limited of Liverpool, which found that 282 million passenger journeys were made in 1973. Because of the falling population, the rise in unemployment and the greater number of motor cars it was forecast that the number of passenger rides would fall to 250 million, whereas they rose in 1983 to 311 million passenger rides. Is it not a scandal that the right hon. Gentleman allows political vindictiveness to interfere with such a successful system as that of Tyne and Wear? Is that not outrageous and insulting to the passengers and population of that area who not only need but care for what the councillors of that area do not want changed.

Mr. Ridley

I do not quite see the reason for the hon. Gentleman's alarm. If, when and where there is an efficient and cheap system of public transport it can perfectly well thrive and improve in the bracing conditions that will exist in future. Moreover, I believe that the policy that I am announcing will have that effect and will make much more possible cheap and socially desirable public transport throughout the whole country. If the hon. Gentleman feels that any of the areas that he mentioned will not be able to survive competition from the private sector, he has a problem and it is high time that the problem was addressed by those areas.

Mr. Eric Cockeram (Ludlow)

Does my right hon. Friend recall that when his predecessor announced the policy of deregulation and competition on inter-city coaches, the Jeremiahs on the Labour Benches predicted doom and gloom, whereas the travelling public increased their use of these facilities, with better service and lower fares, by millions of journeys per year. Will he therefore, as his new policy unfolds, take note of the views of the travelling public rather than those of Labour Members who are more concerned with preserving a monopoly and the position of the transport industry unions?

Mr. Ridley

My hon. Friend is right about the dramatic and startling effects on long distance coaches of deregulation. He is equally right in pointing to the constant weakness which the Opposition reveal. They are interested in the welfare not of the passengers but of the transport organisations.

Mr. Ken Eastham (Manchester, Blackley)

May I assure the Minister that his statement today will create great anxieties, especially among old-age pensioners who are so dependent on public transport? Is it not a fact that this statement is concerned only with profits? May I assure the Minister when he makes observations about private companies, that they run clapped-out vehicles that are not worthy of public transport. Finally, if as a result of this Government's policy, public transport completely collapses, will the Minister provide everyone with pogo sticks?

Mr. Ridley

One does not have to go more than 100 yards from the Palace to see a large number of private coaches used for stage carriage, tourism and excursions from all countries of Europe, but mainly from this country. They are of a much higher standard than those run in many other cities by public enterprises. I make the point very forcefully that it is the private sector and deregulation that has led the trail to improved standards of coaches. I do not know why the hon. Gentleman thinks that that will not happen as a result of this policy.

Mr. Gerald Malone (Aberdeen, South)

Is my hon. Friend aware that the deregulation of coach services in Scotland has led to increased services between cities in vehicles of incomparable quality, far beyond the standard of those offered by public authorities? Does he agree that there is delight on the Conservative Benches at the possibility of those facilities being extended to more cities in Scotland and further delight that his policies will result in some truth being restored to the adage, "There will be another one along in a minute?"

Mr. Ridley

I am grateful to my hon. Friend and I believe that he is right. It is the Conservative party which has the perception to see that services and quality can be improved and costs reduced all at the same time, as we have shown with long distance coaches.

Dr. John Marek (Wrexham)

The White Paper entitled "Buses" presented by the right hon. Gentleman states on page 4, paragraph 2.3: supervision of the quality and safety standards of public service vehicles and operators will be maintained and tightened. Will the Minister give the House an assurance that the average age of the current operating stage carriage vehicle fleet will not get older as a result of his proposals? If he cannot give that assurance, has his Department made an estimate of how much older the fleet will become?

Mr. Ridley

We wish to enhance the control of safety standards. We intend to amalgamate the traffic commissioners and the licensing authorities, which will become regional authorities. That will ensure that inspection of both heavy goods and public service vehicles is tightened up and improved and, where necessary, staffs will be increased. I do not know what the average age of vehicles will be, but we wish the average condition of vehicles to be improved, whatever their age.

Mr. Peter Fry (Wellingborough)

Clearly the results of the measures announced this afternoon will take some time. I hope that, unlike most of my right hon. Friend's immediate predecessors, he will be in office long enough to see the results.

There is much talk about the subsidy of an individual service. I remind my right hon. Friend that there is considerable cross-subsidy within an individual service, especially late-night and weekend operations. What steps will be taken to ensure that operators do not take over a service running a route at highly profitable parts of the day but denying people in urban areas late-night and weekend bus services?

Mr. Ridley

I am grateful to my hon. Friend, especially for his opening remarks which I am sure were addressed to my right hon. Friend the Prime Minister.

Cross-subsidy takes place within a service or mini network, much of which it is in the interests of the operator to continue because it provides goodwill and a complete service. Operators wishing to run less profitable or more profitable routes or buses will be free to do so. If a late-night or weekend service is not in their interests, there is nothing to stop a local authority asking for tenders to run a socially desirable service.

If it is a socially desirable service, would it not be more sensible that its cost should fall on taxpayers and ratepayers, rather than on passengers who may be less well off on the more populous routes?

Mr. Bill Michie (Sheffield, Heeley)

I am a little concerned about what has just been said. I understand that subsidies will be available to the private sector and, if no profit can be made, the local authority will carry the can.

I refer to the Minister's comments about improved prices—I do not know whether they will be up or down—and the betterment of services. Is he saying that he will match the position in south Yorkshire, with its bargain fares? Will he match or improve the service routes within Sheffield and south Yorkshire county council area? Will he increase passenger mileage, cost-effectiveness or the safety record of public transport? Will the cost per passenger mile be decreased? Will he defy about 500,000 plus people who signed a petition in south Yorkshire?

Mr. Ridley

Fares should find their true level by the process of fair competition between different operators who all need to make a profit to stay in business. It is easy to bring fares down by milking ratepayers and taxpayers, but, as I said to the hon. Member for Kingston upon Hull, East (Mr. Prescott), the Government do not believe that that is the right way. The right way has been shown by halving the cost of air fares between London and Amsterdam simply by introducing competition.

Mr. David Harris (St. Ives)

Is my right hon. Friend aware that his statement will be welcomed not only by Conservative Members who represent rural areas and who believe that the present system has led to a fossilised and over-subsidised service in many areas, but by many small enterprising operators who have been prevented from giving the public the services that they want?

Mr. Ridley

I entirely agree with my hon. Friend. It is an odd concept that to improve bus services one should forbid small people from coming into the market to provide them. That prohibition should have been removed years ago. Having visited two of the trial areas and heard what has happened, I believe that this new-found freedom will provide opportunities for many new companies, new small firms which may in due course grow into sizeable companies.

Mr. D. N. Campbell-Savours (Workington)

Is the right hon. Gentleman aware that we had trial deregulation in the county of Cumbria, following the 1981 Act, when a cowboy operator— Yeowarts— set up and cost me rural routes in the Lake District part of my constituency? Does the right hon. Gentleman recall that on that occasion I was given clear undertakings on the Floor of the House during the Report stage of the 1981 Act that I would not lose those rural routes? I did. Does the right hon. Gentleman accept that everyone outside the House should remember that as the supreme example of the Government's deception in implementing this policy?

Mr. Ridley

I think that the hon. Gentleman will find that we have learnt the true lessons of the Yeowarts experience, and that next time those mistakes will not occur. I think he will find that his constituents get a better and a cheaper service. He would be wise to keep his criticisms until they are proved to be justified.

Mr. David Maclean (Penrith and The Border)

May I whole-heartedly congratulate my right hon. Friend on bringing forward these excellent proposals, particularly those which are designed to help transport in rural areas? Will he take special care on this occasion to ensure that county councils which are hostile to private enterprise are not allowed to sabotage these proposals?

Mr. Ridley

I am grateful to my hon. Friend. It shows that Cumbria speaks with two different voices, and I think that his is the right one. In the legislation we shall propose that county councils, in seeking tenders for socially desirable routes, will not be allowed to accept a tender higher than the lowest one, because we are determined that there shall be equal opportunities for all operators.

Mr. Alex Carlile (Montgomery)

Will the Secretary of State for Wales or—if he needs a mouthpiece—his right hon. Friend assure us that the Government recognise the special problems that exist in Wales, and in rural Wales in particular? Will he tell us how much new money will be available for services in Wales? Will he assure us that there will be more bus services in rural Wales? Will he assure us that the network will be maintained so that there is easy and efficient transfer from routes owned by one operator to routes owned by another?

Mr. Ridley

My right hon. Friend the Secretary of State for Wales is here, and I am sure that the will wish me to assure the hon. and learned Gentleman that his concern will be taken into account as policies develop. My right hon. Friend is publishing a paper today that will apply to Wales. May I point out that the £20 million annual declining transitional grant will apply to Wales and Scotland as well as to England.

Mr. Peter Snape (West Bromwich, East)

Does the Secretary of State accept that his statement this afternoon that passenger transport executives will be required to break down their operations into smaller units is the opposite of the recommendations of the Monopolies and Mergers Commission inquiry into the West Midlands passenger transport executive—an inquiry set up by his own Department, which praised the operation and efficiency of that PTE? Is it not political vandalism for the right hon. Gentleman to wreck what is, in effect, a proven success?

Does the right hon. Gentleman accept that, as well as the Association of Metropolitan Authorities, the Conservative-controlled Association of County Councils has already expressed its opposition to the market place nonsense that he advocates this afternoon? Is he aware that the president of the ACC is Viscount Ridley, who, I understand, is not the right hon. Gentleman's uncle, but his brother? Will the right hon. Gentleman this weekend take advice from the obviously more sensible side of his family? What effects will the Government's proposals for PTEs have on section 20 grants which are at present paid to British Rail? The Opposition believe that the Nigerians tried to kidnap the wrong Minister of Transport.

Mr. Ridley

The hon. Gentleman put his finger on an important point. He said that, in a public monopoly, we need a monopolies commission to see whether it is efficient and effective or not, but, where there is fair competition, competition does the trick and we then do not need to use the Monopolies and Mergers Commission.

Section 20 grants will continue as at present. It is becoming a very curious world when the Labour party relies upon the House of Lords for so much of its advice.

Mr. Martin Flannery (Sheffield, Hillsborough)

On a point of order, Mr. Speaker. I wanted to raise a point of order. The fact that you did not take it rendered it irrelevant, as most points of order normally are.

Mr. John Home Robertson (East Lothian)

On a point of order, Mr. Speaker. You will have heard the Minister of Transport, when he was replying to a question asked by my hon. Friend the Member for Glasgow, Shettleston (Mr. Marshall), imply that he did not understand the Scottish section of the statement. He said that Scottish Members of Parliament would have an opportunity to put questions to the Secretary of State for Scotland and he pointed out that the Parliamentary Under-Secretary for Scotland was sitting on the Government Front Bench. I wonder whether you have had any notice, Mr. Speaker, that Scottish Members of Parliament are to have such an opportunity in view of the clear statement made by the Secretary of State for Transport.

Mr. Speaker

I have not had any indication this day.

Mr. George Foulkes (Carrick, Cumnock and Doon Valley)

; Further to that point of order, Mr. Speaker. Surely you will agree that as the whole of chapter 7 applies to Scotland—it contains important matters such as that in paragraph 7.13, which foreshadows a major reduction in grant to the rail network in Strathclyde—hon. Members should be given an opportunity to put questions to the Secretary of State for Scotland. Can you arrange for such an opportunity, Mr. Speaker?

Mr. Speaker

Whether statements are made or not is not a matter for me. The hon. Gentleman knows that. The Scottish Office Minister who is present will have heard what has been said.