HC Deb 12 February 1985 vol 73 cc192-266

Order for Second Reading read.

Mr. Speaker

More than 34 right hon. and hon. Members have indicated their wish to take part in the debate. I propose to apply the 10-minute limit to speeches between 7 pm and 8.50 pm. I hope that those right hon. and hon. Members who speak before 7 pm, especially Privy Councillors, will bear in mind the limit that will be applied to Back Benchers.

I must tell the House that I have selected the motion in the name of the hon. Member for Wellingborough (Mr. Fry).

5.1 pm

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

I beg to move, That the Bill be now read a Second time.

May I first say a word about the amendment in the names of some members of the Select Committee on Transport and others. I am sorry that Committee members were not able to publish their report before Second Reading today. I hope that they will be able to get the report out before the Committee stage. They have toiled long and hard. The Bill is a major part of the Government's legislative programme. It is also a large Bill. If we are to have sufficient debate in Committee on the Bill's many detailed provisions, we must set it on its course. I look forward to seeing the Committee's report, which no doubt will be of great assistance to hon. Members.

The purpose of the Bill is to halt the decline that has afflicted the bus industry for more than 20 years. Many have assumed — wrongly — that that decline was inevitable. It was not. One of the principal causes of the decline was the system of regulations and near-monopoly — the 50-year-old road service licensing rules which embodied an assumption that the best way to protect bus services was to restrict the numbers that could operate.

The Bill is about competition. We want to see operators free to provide the services that the customers want. We want to see competition providing an incentive to be efficient and to offer passengers a better quality of service. The customers may want greater efficiency, lower fares, smaller buses going into residential estates, greater comfort or a more polite and helpful driver. Competition is the key to these improvements. It is the key to increasing patronage.

The present bus regulations date from the 1930s, but the bus industry must learn to meet the challenge of the 1980s. That challenge comes from the private car. As more people enjoy the use of a car, so bus travel has declined, both relatively and absolutely. The industry's response has been to demand, and local authorities' response has been to grant, escalating levels of subsidy. Revenue support between 1972 and 1982 increased from £10 million to £520 million. Even this staggering increase has not halted the decline. It seems to be assumed that if only there was a little bit more subsidy everything would miraculously be all right. The industry was saying the same thing five or even 10 years ago. It got its way. Subsidy increased. But have services improved? Are the customers now satisfied?

By concentrating too narrowly on subsidy, the industry has neglected its market. Blanket subsidy will never solve the problems of the bus or any other industry. Industries have to adjust to their market, increase it if they can, and eventually live by it. In the short term, subsidies can help to ease the transition from a regulated to a competitive market. Subsidy is also crucially important in the provision of transport for people who do not have access to a car and who live in remote areas or need to travel at unpopular times of day or week. The Bill marks a change from subsidy to the industry —a subsidy that all too often has leaked into costs — to subsidy for those passengers who need it.

The Bill is not about reducing subsidy. It is about putting life back into the industry and making sure that the country gets the best value it can for the customer.

Mr. Stan Crowther (Rotherham)

Bearing in mind what the right hon. Gentleman has said about the need to halt the decline, does he agree that, far from there being a decline in south Yorkshire, during the past 10 years there has been a constant expansion of the bus service with the benefit of subsidies? Does that not destroy the right hon. Gentleman's argument that subsidies do not prevent decline? In south Yorkshire those subsidies have prevented a decline. Would it not be better to extend the south Yorkshire system to the whole country?

Mr. Ridley

There has been a massive increase in the subsidy in south Yorkshire. Speaking from memory, the subsidy is about £60 million, 49 per cent. of which comes from taxpayers' funds. That is more than the nation can afford.

In looking only to subsidy—as the hon. Member for Rotherham (Mr. Crowther) and south Yorkshire have—as a solution, we have overlooked the depressing effects of 50 years of regulation on the efficiency and responsiveness of the industry. Whenever an industry is regulated, some of the freedom of the customer to buy what he wants is removed. One begins to discourage and turn away one's best customers. Passengers on profitable or potentially profitable routes pay higher fares than they ought. The industry becomes defensive. Old markets and old routes are protected at the cost of other passengers. There is plenty of life in the local bus market but it is being stifled by regulation.

Thirty-nine per cent. of households do not have the use of a car. In the 61 per cent. of households which have the use of a car, many members will seldom or never be able to use it. That is the bus's natural captive market—a substantial home base for any industry. The bus industry should be trying also to persuade people who have regular use of a car to take a bus—by providing a service which can be relied upon to turn up on time, and which takes them where they want to go at a price they are prepared to pay.

There is evidence of latent demand. We were told in 1980 that there was no demand for express services; indeed the hon. Member for Glasgow, Shettleston (Mr. Marshall) predicted in 1979 that, as a result of the Government's proposals for freeing express coach services, In five years' time nothing will remain of the existing public transport system. There will be a substantial loss of jobs in the transport industry." — [Official Report,27 November 1979; Vol. 974, c. 1218.] It is now five years on and competitive operators have proved him wrong. There has been a 40 per cent. increase in patronage of express coaches. Fares have fallen sharply. The number of express services has increased. Quality has improved. We also have direct evidence that local bus markets do not have to decline. The National Bus Company's new high frequency minibus services in Exeter have brought an increase of 100 per cent. in patronage because they have provided what people want.

Mr. Robert N. Wareing (Liverpool, West Derby)

The right hon. Gentleman was talking about the use of cars. Is he aware that in parts of my constituency that are 10 miles away from the city centre, where 94 per cent. of young people are unemployed and 70 per cent. of people are receiving social security benefits, people are likely to be denied a bus service because it would not be profitable? Seventy-five per cent. of those people have no use of car whatever. Will he give an assurance that those people will be catered for under his Bill?

Mr. Ridley

It is because of areas like those to which the hon. Gentleman is referring that it is necessary to reform the bus industry so that the people can be transported to where they want to go at reasonable cost. That is the whole purpose of the Bill. I give the assurance which the hon. Gentleman requires that services will benefit, not suffer, from what we are proposing.

The potential for expansion exists in both urban and rural areas. In rural areas the growth of car ownership and the decline in bus transport have had a very damaging effect on mobility for those who have to rely on it. This Bill will improve the services in those areas in three ways.

First, the tendering system will enable much better value to be got for the money councils spend on rural services. Not only will operators be able to offer vehicles of a size suitable to the demand, but the effects of competition will reduce the costs of running uneconomic routes, making many more of them viable.

Secondly, there is to be a transitional grant—£20 million in the first year, reducing by even steps over four years—which will be paid direct to operators through the fuel duty rebate mechanism until the full benefits of competition have worked their way through.

Thirdly, there is to be a rural services grant, administered in England by the Development Commission and in Scotland and Wales by my right hon. Friends.

Mr. Edward Leigh (Gainsborough and Horncastle)

Would my right hon. Friend like to comment on the suggestion by some district and county authorities in rural areas that this Bill may be a threat to them because of the threat of phasing out the cross-subsidy from commercially viable routes?

Mr. Ridley

My hon. Friend could not have intervened at a better moment, because that is exactly what I want to do. I will give him some examples of what has happened in rural areas when a competitive element has been allowed in.

First we have the three trial areas. Before I comment on those I would like to remind the House of some of the predictions about them made by Opposition Members during the passage of the 1980 Transport Act.

We were told that if any authority was rash enough to take advantage of the trial area provisions The result would be that bus operators would charge skyhigh fares on profitable routes and provide no services on other routes where there may be more need." — [Official Report, 27 November 1979; Vol. 974, c. 1215.] That was the hon. Member for East Lothian (Mr. Home Robertson).

What has happened? In the Hereford and Worcester trial areas fares have fallen sharply on many routes, and the subsidy requirement has been dramatically reduced by 38 per cent. But, most important of all, the level of services provided has increased by 70 per cent. in Hereford town. It has also increased marginally in the rural areas, where services have been declining fast elsewhere. The passengers, as my hon. Friend the Under-Secretary of State can testify from personal experience, think they have never had it so good.

Through tendering for services, Norfolk county council obtained a reduction from £500,000 to £150,000 in the cost of subsidising an identical group of services, and Surrey council is about to save £200,000 through obtaining tenders for a group of services around Guildford. The House must assume that, if savings of that order are available in Herefordshire, Norfolk and Guildford, they are available elsewhere. With savings like this from greater efficiency local authorities can provide better rural services for the same money, or provide the same services for less money. This gives county councils an opportunity to improve rural services at less cost. That is the answer to my hon. Friend, and he will find that county councils have an opportunity both to provide more services and to save money.

There are lessons here, as well, for all areas of the country. The effect of competition will be to reduce costs dramatically. It will bring into profitability services which were previously considered unprofitable. Fares on main routes will be reduced. Operators will look for and exploit new markets and offer new products. All experience is that the person who benefits from competition is the customer. That is the truth that all the propagandists, all the lobbies fearful of having their monopolies threatened by competition, have tried to hide.

If the market is to develop we must remove the obstacles that confront the innovator. So clause 1 of the Bill sets out to reverse the decline of the bus industry by the abolition of road service licensing. If the Opposition parrot cries were true that the aim of this Bill was to achieve a free-for-all for cowboys creaming off the profits with clapped-out buses—a charge to which I note the private sector has taken great exception—there would be no more than clause 1. There are in fact 113 further clauses. These seek to achieve a flexible and competitively structured industry within a framework of stringent controls to ensure reliability and safety and of local authority powers to meet the needs of those not served by the market, and of elderly and disabled people.

The existing requirements for operator licensing will continue, and clauses 21 to 28 contain a number of new provisions to modify and tighten up those requirements. Let there be no doubt about the Government's commitment to maintain operator standards and to provide the means to take firm action against operators who abuse the freedom which this Bill gives.

The provisions are linked to the system of registration which is set down in clause 5. An operator wishing to run a local service must register the route, stopping places and other details with the traffic commissioner. He must give notice of his intention to start or discontinue a service, and he must run the service in accordance with the registration.

Under clause 23 an operator who runs unreliable services or does not register them may have his public service vehicle operator's licence restricted. That can also happen if he interferes with another operator or behaves dangerously or recklessly, or if his maintenance is inadequate.

Under clause 91 an operator stands to lose 20 per cent. of the fuel duty rebate due to him for all local services run by him during the previous three months if he fails to register or runs a registered service unreliably. These are serious sanctions. We are committed to making the registration system work to ensure reliability.

Clauses 6 to 8 give the traffic commissioner powers to impose traffic regulation conditions where there are problems of severe traffic congestion or danger to the public. These powers are new; they have never been suggested before. They can be used to stop operators using unsuitable streets, to limit the use of bus stops or to prevent congestion caused by bunching by allotting the use of stops at different times to different operators.

With the ending of road service licensing there is no longer a need for a body of three traffic commissioners. Instead, clause 3 provides for a single commissioner, the existing Chairman of Traffic Commissioners, to be the authority for operator licensing for both passenger and goods vehicle operators and the new registration authority. I think that the whole House would like to thank all those who have served as traffic commissioners for the excellent service that they have given over many years.

In London, for the time being, road service licensing will continue and part II of the Bill essentially re-enacts existing legislation. Clause 44 enables me to bring deregulation to London also. But first we must see through the major changes that were introduced in London less than a year ago. Indeed, London Regional Transport management has to tackle a legacy of appalling inefficiency.

We also want flexibility between different types of vehicle. Clauses 9 to 14 bring taxis and hire cars into the mainstream of public transport, and restrict a local authority's power to limit the issue of taxi licences as already happens in Scotland.

Mr. Colin Shepherd (Hereford)

I should be most grateful if my right hon. Friend could spare a second to cover a point that involves chapter 6 of the White Paper. In paragraph 6.5 there is talk of a gradual increase in the number of cabs. It states: The Government will propose provisions to relax progressively the restrictions on the number of taxis which operate in some areas. I have not been able to find the relevant provision in the Bill. Is it covered by clause 14?

Mr. Ridley

Clause 14(2) contains the relevant amending provision which produces the pressure slowly to reduce the restrictions on taxi licensing.

Sir John Page (Harrow, West)

Why does the Bill discriminate against 30,000 private hire car drivers in London, who are not allowed to take part in the sharing scheme despite the fact that there is probably the greatest demand for it in London?

Mr. Ridley

My hon. Friend has discussed that matter with me. I think that the Committee will want to debate that point. It is a question of whether we should have supervision and licensing of hire cars, with all the bureaucracy and expense that goes with that, or whether the present arrangements, which most people find satisfactory, should continue. However, I am happy for the Committee to consider that issue to see where the balance of advantage lies.

There are three ways in which taxis can operate in future. First, passengers may still hire a taxi for their own exclusive use. Secondly, clauses 9 and 10 make it possible for people who wish to share a taxi or hire car to pay separate fares. Thirdly, clause 11 allows licensed taxis to be used to provide regular local services.

In order to be sure that competition is fair, the Bill contains proposals for the restructuring of the bus industry. To abolish road service licensing without tackling the issue of competition on fair terms would be reckless. Freed from the constraints which road licensing imposes, companies could use their market strength, bolstered by public subsidy, to stifle their competitors. That is, indeed, what they are trying to do in Hereford.

I turn first to the National Bus Company. It is required to submit to me plans for the disposal of its operations to the private sector and to implement those agreed plans within three years. The main objective of the company will be to promote sustained and fair competition not only at the disposal stage but also in the behaviour of local subsidiaries competing in the deregulated market.

We want local managers of the National Bus Company and their employees to own as much and as many of these companies as possible and the Bill makes special provision for that.

Secondly, the passenger transport executives and some 50 district and regional councils at present have their own bus undertakings. By the time deregulation takes place they will he required to form Companies Act companies to which they will transfer the bus undertakings. These new companies will be at arm's length from local authorities, and will have to compete on fair terms with other operators. After deregulation it will not be possible to subsidise the companies directly except with my consent. The separation of the bus undertakings from the PTEs is the first step in reorganising the metropolitan bus undertakings into several separate competing companies. Clause 58 provides the necessary powers to require breakup after the transitional period.

I should like at this point to refer to a provision which is not in the Bill, but which is an integral part of our policy for competition. I refer to the removal of the present exemption of bus service operators from the provisions of the Restrictive Trade Practices Act. To continue that exemption would be incompatible with competition. It can be removed by an order made under the Restrictive Trade Practices Act.

One matter of concern during the consultation has been the role of local authorities. In a free competitive market it no longer makes sense for local authorities to have a duty to co-ordinate public transport. Instead clause 55 places a duty on them to secure powers to subsidise passenger services which are not provided by the market. These are powers to promote the use of transport services generally, provided that they do not inhibit competition. Local authorities will be able to discuss the transport needs of their areas with the operators, to provide timetables and to advise the traffic commissioners about traffic problems. Their role is if anything increased.

Local authorities are required to seek competitive tenders for subsidised services under clauses 80 to 84.

Open tendering will ensure that all bus operators will have equal access to subsidy; that local ratepayers know what bus services are being bought at what cost to them; and that local authorities will be able to get the best value for money in their use of subsidy.

Clause 80 places a duty on local authorities to consider their expenditure on public and school transport services as a whole in order to get best value for money. These functions must not go on in isolation from each other. This is an important way to get more effective use of public money.

Mr. Christopher Hawkins (High Peak)

Is my right hon. Friend aware of the widespread concern that has been generated by the campaigns run by Opposition parties in my constituency and many other constituencies to frighten old and disabled people into believing that the Bill will abolish bus passes? Will he condemn such scaremongering, and take this opportunity to reaffirm that under the Bill bus passes can continue? Will he give us any details of how they will operate under the new system?

Mr. Ridley

I am grateful to my hon. Friend for that intervention. The Bill gives the lie to the scare stories that my hon. Friend has heard to the effect that the powers of local authorities to provide concessionary fare schemes for elderly, blind and disabled people will go. That is simply not true. But we seek to make them more widely available and to allow any operator who wishes to do so to participate. That represents an extension. Nor does the Bill force local authorities to use tokens rather than bus passes. Some local authorities already operate bus pass schemes with a number of operators. Therefore, I am sure that my hon. Friend will tell those who have been spreading scare stories—and some local authorities have spent a lot of ratepayers' money on propagating scare stories—that they have been wasting the ratpayers' money in throwing it around on something that is not true.

The Bill also clarifies local authorities' powers to provide concessionary fares—

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

The right hon. Gentleman has been paying a lot of lip service to the experiment in Herefordshire, but is he aware that Hereford council has stated categorically that the experiment has led to reduced benefit to recipients of Concessionary Travel Schemes as a result of the unstable fares and the necessary adoption of a token system". Does that not give the lie to the right hon. Gentleman's statement?

Mr. Ridley

The hon. Gentleman has kindly given me another point. The cheaper the fares are, the less concessionary fare passes will cost. If, as in Hereford, there are free buses running, concessionary fares will cost nothing. Through competition, the Bill's provisions will lead to a reduction in fares on many routes, and the local authorities will be able to make savings by not having to pay so much for concessionary fare passes.

The transitional provisions in schedule 5 are important. They are a result of the consultation exercise. Our aim is to achieve as smooth a transition as possible allowing competition to emerge gradually without giving an unfair competitive advantage to any one class of operator and without disrupting services on which passengers rely. Road service licensing is to be replaced by the registration system on 1 October 1986. By then local authorities will be required to have completed the move from network to tendered subsidy and to have transferred their bus undertakings to companies, and the National Bus Company to have reorganised its operations to ensure fair competition.

Road service licensing criteria will be modified in this period to allow greater competition. The traffic commissioners will be required to accept an application unless the new service would disrupt arrangements being made by local authorities to effect a smooth transition, unless the applicant would be able to compete unfairly because he was still receiving blanket subsidies or unless the new service would create severe traffic problems.

Mr. Gordon Oakes (Halton)

On the question of transition, will the Secretary of State look at his diary? Does he realise that 1 October 1986 is mid-week? In fact, it falls on a Wednesday so that one system will be in operation on a Tuesday and a different one on the next day. Contracts must be drawn up with operators, often on a weekly basis. Did he consider that when he chose 1 October?

Mr. Ridley

I shall look at my diary if the right hon. Gentleman will read the Bill. He will observe that there is clearly set out in the Bill a transitional period in which all these things will happen so that they are complete by 1 October. The situation will not change dramatically overnight because everything will have been put into place.

The Bill also contains the provisions on bus substitution services that the Select Committee suggested in 1983. The railways board may put forward proposals for bus substitution in situations where existing rail services are making significant operating losses and where buses can provide travellers with a reasonable alternative service at substantially lower cost of operation.

It will be for the railways board to put forward proposals for bus substitution in particular places, and I would take account of those bus substitution proposals in deciding whether to give my consent to any proposal from the board to withdraw rail passenger services from a particular line. This is an area where the Select Committee can see its work reflected in our proposals.

My proposals for the bus industry have been called radical. They are; nothing less would do. It is strange that these days the word radical frightens the Opposition parties to death. The Labour party's radicalism is to throw more public money at any problem that it observes. Liberal radicalism has become agreement with everyone who has a complaint in the hope of picking up the odd vote. But bus services are too important to too many people. We cannot shirk reform. We cannot sit idly by and watch the bus industry sink further into decline, leaving more people isolated. There is far more to this Bill than deregulation, far more than privatisation. It is a full-scale rescue plan for the bus industry. It sets local authorities free to concentrate on help for people who need it. It sets operators free to compete and find markets in order better to serve their customers. In short, the Bill puts the passengers first. I commend it to the House.

5.33 pm
Mrs. Gwyneth Dunwoody (Crewe and Nantwich)

It is important to establish what the Bill is and what it is not.

First, it is not a Bill about improving public transport. The one thing that is absolutely certain is that the Secretary of State has pushed ahead with the legislation irrespective of the fact that he has no proper evidence to prove that it is necessary, that a Select Committee of the House has been taking detailed evidence which would have enabled him to come to some sensible conclusions and that, even after the rapid run round the country which passed for consultation on the part of his hon. Friend the Under-Secretary, there is still nobody of any status or with any real knowledge of the transport industry who imagines that the legislation will improve the bus services.

The Bill is about the two pet obsessions of the Secretary of State. One is privatisation and the other is deregulation. It is therefore important that we should examine closely what is being introduced to the House in such a hurried and incompetent manner.

The Bill will not provide a better service for children on their way to school. It will not improve facilities for old-age pensioners who need concessionary fares. It will not provide a more efficient service for women who rely on public transport to do their shopping and to get to the doctor and to other essential services.

The Bill is about the Secretary of State's wish to save money on subsidies. He has made that plain from the beginning of the debate. His attitude towards public service is that it should be provided free of charge preferably and with no protection for the people working in the industry or for those who wish to benefit from the services. He made that clear in the explanatory statement. He says that of course 50,000 jobs will have to go, but that other jobs will be provided in the public service.

The change that the Secretary of State is proposing will lead to total anarchy. No such measure is applied anywhere in the world except in Kenya, which has now decided that it needs a form of regulation, and in Hong Kong, which has one or two minor differences from the United Kingdom of Britain and Northern Ireland. Such a measure when applied in other places has been found over a period to lead to total anarchy and chaos.

The attitude of the Secretary of State is that people should be prepared to go and buy cars and, if they cannot do that, they must travel by taxi. That argument has threaded through consideration of the Bill.

The National Federation of Women's Institutes, an organisation not normally connected with revolutionary ideas, was so worried by the implications of the Bill that it carried out a survey of 4,000 members. It found that 50 per cent. of women in the Oxford group had no day-time car, 40 per cent. of women in the area had no car licence, 30 per cent. needed the bus once a week or more and, of 237 towns and villages covered in the survey, only 33 had an evening service. Therefore, the majority of women, for shopping and medical attention, needed the advantages of a bus. The NFWI said that the effect of the legislation would be for women in rural areas to be left totally isolated, and that its anxiety had turned to despair. It said that only those with two cars per family in the country would be able to have decent lives.

The effect of the legislation will be that not only those who live in villages will suffer. Those who live in large cities where shopping centres and hospitals are concentrated on the periphery will also suffer.

Mr. Colin Shepherd


Mrs. Dunwoody

I will give way to any female member of the Government. [HON. MEMBERS: "Sexism."]

Mr. Deputy Speaker (Mr. Harold Walker)

It is clear that the hon. Lady is not giving way.

Mr. Colin Shepherd

I am most grateful to the hon. Lady for giving way. This is an important matter to the women of the country. When the hon. Lady wrote to the National Federation of Women's Institutes, did it tell her that the Herefordshire federation did not share the view of the national federation? It is the north Herefordshire women who have been living and working in the trial area during the past three years.

Mrs. Dunwoody

I shall come to the Hereford experiment later and go into it in very great detail. I shall then comment on the hon. Gentleman's point.

The reality is that nationally 30 per cent. of women have car licences, compared with 68 per cent. of men. In the west Midlands, women account for 60 per cent. of the passengers of the bus companies. Among old-age pensioners, 14 women use buses for every six men. It is important, therefore, that we are aware who will be especially concerned with and damaged by the proposals.

Mr. Anthony Steen (South Hams)

The House would find it tremendously helpful if the hon. Lady could explain why the Bill, which is removing regulations that are controlling the system and not allowing it to liberate, will discriminate against women. In fact, it will help women by providing many more services, especially in rural areas where it will bring women into the towns. That is a good thing, not a bad thing.

Mrs. Dunwoody


Mr. Deputy Speaker

Order. As a large number of hon. Members on both sides of the House will seek to catch my eye during the debate, I must tell the House that in deciding whom to call, I shall take into account the interventions made and the extent to which they have preempted other hon. Members.

Mrs. Dunwoody

It is very important to understand that the hon. Member for South Hams (Mr. Steen) comes from an area with large spreads of villages and very few buses. He will soon find that in the South Hams area those who need buses will have their interests badly damaged by the Bill. The reason lies precisely in the effect of deregulation, which we have just been told is the most important aspect of the Bill.

The reality is that the entire legislation has been brought forward on the basis of what we were told were a number of experiments. The Hereford experiment has been mentioned time and again. We were told that deregulation and the conversion of municipal and NBC operations into private companies would wholly transform any provision and that in identifying unprofitable routes and the tendering for private contracts, the bus industry would be liberated and better services would be provided for everyone.

The reality in Hertfordshire, and especially in Herefordshire, was the opposite. In Hereford, the rural areas were, without exception, worse off at the end of the experiment than at the beginning. It is true that in the centre of the town there were initially a number of additional buses. However, they did not come in a properly timetabled manner nor in a way that provided better facilities. Some of the fares went down initially, with some operators actually running free services.

One does not need to be too brilliant an economist to work out that no company can continue to run free services for any length of time if it is, first, to replace its existing stock and, secondly, to provide decent conditions for those who work for it. Yet we are told by the Secretary of State that that is not a problem because in future those who want to run buses will have total freedom to do so. The right hon. Gentleman has actually suggested that those who are out of work can rush out and buy a bus and operate it in the areas where they are unemployed. Far from creating new jobs, this legislation will do one simple thing—it will make it extremely difficult to maintain any safety standards for the passengers. I would have thought that even Conservative Members would be concerned about that.

Mr. Roger King (Birmingham, Northfield)

Tell us about London Transport.

Mrs. Dunwoody

I shall be happy to discuss London Transport in a minute. If the Secretary of State really believed that the Bill was the answer to providing a new transport system, surely he would have been before the House today saying that it should be brought in for London as soon as possible. The actual contradiction to his present argument lies in the fact that he has an opportunity to introduce the scheme in London, but he has no intention of doing so.

Any public industry must have a safety responsibility to its passengers. In Hereford, some of the private operators were found to have many dangerous faults in their buses-47 in one instance, and the operator lost his licence. One man was maintaining his buses in a layby—which is the ideal way to ensure a high standard of public service vehicles. Other operators were found to have a number of major faults in their buses. But we are told by the Secretary of State that we do not have to bother with all that, because he will monitor the effects carefully to ensure that all public service vehicles maintain a very high standard of safety.

All sides agree that, at least initially, we may have a larger number of smaller bus operators providing services— even if those services, almost inevitably, cover a smaller number of routes. There is no doubt that one effect of much smaller bus companies will be additional problems in maintaining the standard of the vehicles. Even if we ignore the business methods of the sort of people who will try to cream off any profitable routes, and look at everybody across the board, additional problems will be created simply because of the size and viability of the companies.

The Leeds institute for transport studies, in the most thorough survey of deregulation to date, quotes a survey of 478 bus operators in Yorkshire. It found that small companies with one or two buses were eight times more likely to have defects than the major companies with 50 or more buses. That also applied to the number of defect notices per million vehicle kilometres—the figure was absolutely minimal at the top end of the scale compared with operators with one or two vehicles. One reason is that a small company cannot afford its own maintenance yards and equipment. No matter how honest the new operators, safety standards inevitably decline.

The evidence from the Government's trial areas is very instructive. Four new operators emerged in the Hereford trial area. The Devon and Norfolk areas were not considered to have shown the effects of deregulation. Of the four in Hereford, one company had its licence reduced and was then banned in February 1983. The operator had broken 47 safety codes, 27 of them immediate —meaning that they needed immediate attention. The traffic commissioner, in banning the operator, said: to allow you to continue to hold a PSV operator's licence for any longer than is absolutely necessary could result in death or injury to the public. In March 1984, another operator had his licence reduced following more complaints.

From the evidence that exists, it is clear that more companies with more safety problems and more operators with even less interest in safety will enormously increase the strain on the traffic commissioners. Without additional resources — and although the Secretary of State has spoken about the need to maintain a proper service, he has given no sign that he will provide the proper resources—the traffic commissioners will inevitably have to shift from preventing the operation of unsuitable companies to picking up the pieces and banning the companies after they have proven to be inadequate for the task in hand.

The work of the traffic commissioners for road haulage and passenger vehicles will be merged under one person. An assurance is needed that the work per employee will not be increased. There are signs that the merger may lead to overall reductions in staff available and consequently to even less monitoring of the safety provisions.

The White Paper promised new safeguards to ensure that safety standards were maintained. The control, to which the Secretary of State referred this afternoon with great approval, means that the traffic commissioner is able to prevent dangerous traffic conditions or severe traffic congestion. Those are the circumstances in which he can operate.

However, clause 7 says that an operator cannot be assumed to operate the proper service solely by reason of his complying with any traffic regulation conditions. It is clear that part-time drivers working on the buses as a second job could become the norm. Otherwise, why is it so essential we should introduce those changes? All the threats to safety that that implies have been glossed over both this afternoon and in the talks that the Secretary of State and the Under-Secretary of State have had with all the people concerned.

Clause 81 says that tenders may not include conditions with respect to the terms of employment". In other words, we shall have no way of knowing what hours the people operating the buses will be working and how tired they will be. After 50 years of proper controls, the chance of bad crashes caused by over-tired drivers will be introduced as a law.

Inevitably, the Bill will affect those that we are told will be protected. The Secretary of State says that in future local authorities can, if they wish, hand out bus passes. Let us consider the whole business of concessionary fares. The Government say that they have not been banned, but they never refer to the fact that many authorities will not only be rate-capped but will be constantly told that they are in danger of going into penalty. The spread of operators alone will make travel cards, which are a great asset to many old age pensioners, extremely difficult to use. [HON. MEMBERS: "Why?"]

Hon. Members do not seem to understand that, if there are many different operators on the same routes, there will, almost inevitably, be constant arguments over who is eligible to use travel cards. Inevitably, local authorities will move towards a system of tokens. One effect of that, which nobody ever wants to discuss, is that free travel comes to an end when all the tokens have been used up. At the moment, many elderly passengers go backwards and forwards using travel cards to do their shopping, to go out for entertainment, to receive medical attention and to go away at the weekends. That will not be possible under a system of tokens, which will be a much lower standard of provision. The scheme is completely indiscriminate since every operator must be given access to it. The only control that the authorities will have is if the charges are unusually high. A difficult service or an unhelpful company cannot be banned under the existing legislation.

The Government will claim that they have extended the scheme to children, but it emerges from schedule 7 that, although they have maintained the Scottish right to aid the mentally handicapped, there is no similar provision for those elsewhere in the United Kingdom.

The Government have already decided that next year they will cut concessionary fare grants by £48 million—more than 20 per cent. With the rate capping of the metropolitan county PTAs, the concessions will be of astonishingly little use.

It is not only the elderly and those in receipt of concessionary fares who will suffer. Those who live in the country will be particularly affected. Services will be disrupted. The National Bus Company is the main service in the counties and the cross-subsidy is worth at least £122 million. The institute of transport studies in Leeds estimates that it could be as high as £305 million. That will be lost because the Secretary of State has made it clear that he does not believe in cross-subsidy. He does not accept the fact that the only way that many bus companies make their operation viable is to cross-subsidise between peak hours and busy routes and difficult hours and rural routes or non-viable routes in the suburbs. That is such a basic way of balancing the bus books that I should have thought even the Secretary of State would have been careful before he wiped that out.

Mr. Ridley

The hon. Lady should be a little careful, because cross-subsidy involves much higher fares on the prosperous routes than are necessary even to break even. The Bishop of Durham has already said that it is immoral to make a profit on a bus route, so to cross-subsidise on a bus route must be super-immoral.

Mrs. Dunwoody

If people living in country villages have a choice between a higher fare and no bus, they will be perfectly clear in their own minds which they prefer.

Let us be quite plain what we are talking about. The Secretary of State tells us not to worry about the transitional period, because he is aware of the difficulties and will provide £20 million. Of course, he will reduce that by million over four years until it disappears, but he says that that is nevertheless bound to be enough to deal with all the difficulties. He also says that perhaps we should have £1 million for experiments with minibuses because they may be the answer. In Cheshire, the authority bought a minibus and handed it over to Crosville. Less than 11 months later, that vehicle is clapped out, needs replacing and is unable to perform the function required of it.

Mr. Terence Higgins (Worthing)

I am rather worried if my right hon. Friend the Secretary of State is more extreme than the Bishop of Durham, but let me leave that on one side. The hon. Lady is looking all the time at the cross-subsidy from the point of view of a person receiving it, not at the £140 million which others are paying for that subsidy. Why should people in towns pay that subsidy, which is in effect a tax, to help those in rural areas?

Mrs. Dunwoody

Unfortunately, people in towns will not escape the effect of the Bill. We have heard a great deal about the services in Exeter. No one has said that the little minibus there is only running up and down an exeedingly limited central part of the city. Those who are paying the taxes that we are talking about, whether by rates or taxes, in the outer suburbs of Exeter are not benefiting from that tiny minibus and are not likely to do so. The hon. Gentleman must be clear that those people who live outside one or two clearly demarcated busy routes in the centre of cities will be in the same situation as those in the rural areas.

No one will cross-subsidise a bus going to a hospital outside the urban area. No one will cross-subsidise a school bus that is going across country from one comprehensive school to another. No one will cross-subsidise buses during difficult hours or on difficult, unused or half-used services. To think that those who live in towns will automatically be provided with better services is not to understand the implications. Almost inevitably, services will disappear. Then and only then shall we see the extent of the need for cross-subsidisation in order to provide a public service—because that is what the bus services are.

When we talk about the effects of the Bill in rural areas, we should be aware that the shire counties alone will have to find an extra £102 million in subsidies just to maintain services on the NBC routes. With a cut of £250 million—30 per cent—planned in April in transport subsidies, there is no way in which the shire counties can maintain those subsidies.

In Hereford — despite what we were told about Hereford town—no operator was willing to take on one of the 53 routes without a subsidy. We are told, however, "It is unfortunate if people cannot get buses. They can always get taxis." The Department is adopting a Marie Antoinette attitude—if people cannot have buses, let them take taxis.

It is, of course, more expensive to travel by taxi. Taxis cost on average 95p a mile, compared with 16.5p a mile on buses. About 75 per cent. of the population will not take cabs. The city controller's office in Indianapolis studied the various systems, and when told that it was the intention of Britain's Secretary of State to change the entire taxi service, commented: England had the best taxi service in the free world by industry standards. Why is it that Government always wants to fix something that isn't broken?

Mr. Robert B. Jones (Hertfordshire, West)

While the hon. Lady is talking of the United States, may I ask her to consider what is happening in Phoenix, Arizona, where taxis are operating as subcontractors for the weekend bus service, at which time there are between 300 and 400 passengers, compared with 40,000 passengers a day during the week? That shows that, when there are fewer passengers, it is appropriate to have a taxi service. Is she aware that in that case taxi fares are almost identical to bus fares?

Mrs. Dunwoody

Removing the regulations applying to taxis will be no gift to taxi operators, many of whom will find themselves being undercut by others coming in. The system of licensing which they have enjoyed will be wiped out. The hon. Member for Hertfordshire, West (Mr. Jones) will discover that those in the taxi business regard this as an ill-conceived and unimaginative piece of legislation.

The second and next important leg of the right hon. Gentleman's case is the whole question of the privatisation of the National Bus Company. We are told that the right hon. Gentleman is not interested in having viable companies but wants them broken down into smaller units, although today he did not specify the size of company that he would regard as viable.

Grieveson Grant and Company, the stockbrokers, said that, if the whole of the NBC was sold as a unit, it would be worth between £150 million and £200 million. That estimate explains why the Bill is being rushed through. The Secretary of State is rushing to help the Chancellor of the Exchequer; if the Government cannot find sufficient state assets to sell off, the Secretary of State believes that the National Bus Company can be sold to help the Chancellor do something to improve the economic situation.

The Monopolies and Mergers Commission stated that the present structure of the NBC was beneficial to efficiency. The attitude of the Secretary of State is muddled. On the one hand he has evidence to prove that the unit as a whole is worth a great deal of money. On the other, he tells the operators, "I want it broken down into smaller pieces." He will, in the process, fall heavily between two stools. He will provide units that are too big for local operators to buy and run, but too small to interest the institutional investors.

All this destruction is being carried out in the name of promoting better public transport. It is worth noting that, since the National Bus Company was formed, nearly all the private companies, particularly the holding companies, have pulled out and have put their money into different types of operation.

The effect on the staff of the NBC will be disastrous, especially as most cost advantages will come from reduced wages being paid to them. The NBC has made it plain that its pension plans for staff will not be protected by the Bill and that the 1982 Act will not help the 15,000 pensioners involved.

Why are the Government so determined to push this legislation through in this way? Do they genuinely believe that by opening the gates to competition they will produce a new era of better bus transport services? [HON. MEMBERS: "Yes."] In reality, nothing of the kind will happen.

The Government feel that they need not indulge in consultation to discover what is really important for the public. They do not believe in constructing legislation based on research and investigative work done by those with knowledge of the bus industry. For this Government, it is sufficient to move fast towards certain shibboleths that are important to the Secretary of State. One is to remove from the public sector any service that is providing a level of care if that service has any reliance on subsidy. It does not even matter if it is impossible for other sectors to replace the existing system.

It does not matter to them if many rural areas suffer and if people in towns who wish to use buses at off-peak times find it impossible to do so. It does not matter to the Government if what the right hon. Gentleman is doing will wipe out 50 years of road safety, of better services generally and of good facilities for those most in need. It does not matter to them if concessionary fares for the old and benefits for the young are wiped out.

It is important for the House to understand that the Secretary of State is concerned only that we should, by some means, hand the system over initially to small companies which want to cream off profits from any little areas of state assets that can be made available. The cost of this Secretary of State is high, but it is high mostly to those who cannot hit back, those who cannot protect themselves. I hope that, for that and many other reasons, the House will refuse—in the interests of those who are of most concern to us all—to give the Bill a Second Reading.

6.6 pm

Mr. Peter Fry (Wellingborough)

I beg to move, to leave out from "That" to the end of the Question and to add instead thereof: this House declines to give a Second Reading to the Transport Bill until it has had the opportunity of studying the imminent report of the Transport Committee on what is the most fundamental upheaval in the bus industry for over 50 years. The amendment stands in my name and in the names of most members of the Select Committee on Transport.

I begin with what I regard as a House of Commons point. Last year the Select Committee decided to conduct an inquiry into the financing of the public transport services. In the autumn it decided to extend that study to take account of the bus White Paper. We discovered, however, in view of the amount of evidence that was put before us, that we could not report before Christmas. On the other hand, the Government, having produced their White Paper, also produced a mass of consultation documents and gave no deadline for this Second Reading debate. The chairman of the Select Committee wrote to the Secretary of State saying: The Committee has accordingly agreed that I should write to you to request a delay in the introduction of that legislation until our report is published. On 10 December last the Secretary of State replied: I fear I could not undertake to do that—nonetheless, a Bill of this importance will undoubtedly be very thoroughly considered by Parliament through all its stages. One would imagine from the wording of that letter that the Government were proceeding with speed to produce a Bill immediately following the Christmas recess. Indeed, that was the advice that some of us were given, yet not until today do we find the Bill before us on Second Reading.

The majority of members of the Select Committee feel that the evidence given to us was of such a nature that the rest of the House — certainly the members of any Standing Committee that might be set up to consider this major revolution—should have the advantage of that evidence and, preferably, of any report that is made.

We were aware of widespread concern on a variety of points among all sections of the community and across the political spectrum. I tell my right hon. Friend the Secretary of State, and my hon. Friends, that so far most of those concerns have not been resolved by the publication of the Bill. I believe that the work of the Select Committee is important. We have laboured hard and long to produce the report. We have taken evidence, and visited Hereford and Worcester. The taking of evidence has now ended and the report will shortly be produced.

I do not claim that the report will be enough. I do not claim that it will be either for or against the Bill. It will, however, show the House and the country how much feeling there is on the issue and how necessary it is to proceed with caution rather than rush madly ahead and accept the first set of proposals put forward.

In addition to my amendment, I should like to mention early-day motion 358 which calls for consignment of the Bill to a Special Standing Committee, again because those who will deal with the Bill should be entitled to take evidence from anybody whom they think would be able to help them, and, at least, to study the evidence that we have gathered. That is the very least that the House should allow. If we do not allow members of the Standing Committee to take advantage of all the work that their colleagues have done, the whole future of the Select Committees and the relationship between them and the House will be brought into question.

There are occasions when party politics are put on one side and we try to produce useful ideas that have a broad measure of agreement. That has been one of the bonuses of the Select Committee system. If Committees were always strictly partisan, their reports would be greatly devalued. I pay tribute to the Labour members of the Select Committee who bravely joined us in producing a unanimous report on the London area even though some people might have thought that they had gone too far in our direction.

The amendment is not supported only by those who put their names to it. It is also supported by no fewer than 11 national organisations. They are the Association of District Councils, the Association of Transport Co-ordinating Officers, the Bus and Coach Council, the Chartered Institute of Transport, Friends of the Earth, the National Association of Local Councils, the Ramblers Association, the Royal Town Planning Institute, Rural Voice, and Transport 2000, all operating under the aegis of Women in the Community — the National Federation of Women's Institutes. The organisation wrote to me as follows: We cannot anticipate what the Select Committee will say, but we feel that it is constitutionally inappropriate for the House of Commons to consider legislation in advance of receiving the report of its Select Committee". Although not opposed to the Bill in principle, the Association of County Councils also has strong misgivings and would like to see the Bill sent to a Special Standing Committee.

The list is impressive. It cuts right across the political as well as the transport spectrum. What is at issue is the right of the House to information. It would be a mistake for the report and the evidence that the Select Committee has heard to be produced after Second Reading —let alone after Committee stage.

Many of my hon. Friends are completely bemused by the Bill. They receive conflicting reports from local councils, bus operators and voluntary organisations such as the NFWI. The Secretary of State and the Parliamentary Under-Secretary ply them with tea and sympathy in an attempt to encourage them to support the Bill. In my view, the House should have an opportunity to make up its mind about this fundamental change on the evidence, when it is published. That is the core of my plea. The House must decide whether to use our Select Committees or ignore them. Do we regard them as peripheral centres of activity to which we consign awkward hon. Members in order to keep them out of the Chamber, taking little notice of what they have to say? [Interruption.] Yes, some of us emerge every so often. Alternatively, do we accept that the Committees represent a serious attempt to enable a group of hon. Members gradually to gain a level of expertise on a subject that others would find it difficult to attain, to question Ministers and civil servants from a state of knowledge, and once again to begin to assert the influence of the House upon the Executive, no matter what colour it may be? No instance since the Select Committees were set up has brought the issue before the House as sharply as this.

My right hon. Friends the Secretary of State and the Leader of the House can ignore the protests that I am making. There is no doubt that the Government, with their huge majority, could roll the matter over. However, in the long run such action will not be good for the Government or the House of Commons, and I doubt whether it will help the cause of parliamentary democracy in this country.

Of course Ministers want to push through their legislation — that is what we expect of them — but sometimes Governments display a tinge of arrogance. I am sure that my right hon. Friend does not wish to give the House an impression of arrogance. It is because I am sure that he does not wish to give that impression that I urge him to accept my amendment.

Mr. Ted Leadbitter (Hartlepool)

Do I understand that the Secretary of State ignores the work of the Select Committee — as a senior member of another Select Committee I regard that as a serious matter in itself —even though he has been before the Committee for a substantial time?

Mr. Fry

It is true that my right hon. Friend appeared before the Select Committee, and we had a long and interesting session. He did not ignore the work of the Committee. The Committee made him very much aware of the work that it had done.

I should like to make it clear that I favour increased competition in bus services, that I believe that subsidies to passenger transport executives should be reduced and that I favour the privatisation of the National Bus Company. In regard to the latter, I must declare an interest, although my interest in bus matters goes back many years to when I was chairman of the Conservative bus policy committee and took part, with my right hon. Friend the Secretary of State for Social Services, in producing our policy document "The Right Track" before the 1979 general election.

It would be wrong if no Conservative Member expressed some anxieties about the Bill. I should like first to deal with some of the wrong impressions that have been spread abroad. The first is that, because the Transport Act 1980, which liberalised coaching, has been successful, the same must automatically apply to the stage carriage bus industry. With coaches, the competition was not between two types of road operators but between two modes—road and rail. Moreover, as with deregulation in other respects, such as aviation in the United States, the result is more services on some routes and the disappearance of services on others. The Transport and Road Research Laboratory study has come up with some rather interesting figures. With all the extra coaches, there are only 43 more services as a result of the 1980 Act. That might surprise some hon. Members. Taking a service away to put it on another route is all very well, provided that a service remains in spite of the redirection. If a coach is taken off a route, there might be a stage carriage bus service serving the same route, but take off the stage carriage bus service and the people of the area are probably left with no public transport.

The second wrong impression is that innovation is virtually impossible under the present legislative set-up. Less than 0.5 per cent. of applications for licences have been refused recently. Even the example of Exeter, which has been given today, has taken place under existing law and without any competition. Competition could well undermine the success of that experiment.

A third false impression is that there has somehow miraculously been an increase in the number of passengers, enabling more services to be supplied and fares to be reduced. Revenue can be got only when demand exists. If there is not much demand, it is difficult to extend services as the Bill intends. Indeed, the evidence shows that the extra revenue comes not from existing passengers who make extra journeys. That is the evidence of the Association of County Councils.

A fourth misconception is that there will inevitably be massive economies. Existing economies are within a regulated system and at current fares. There is no guarantee that, in an unregulated system with cut price fares and without cross-subsidy, the same savings will necessarily accrue. The fifth fallacy is that the traffic commissioners are the ideal people to deal with problems that arise. I have been to Hereford and Worcester and seen some of the dangers of competition there and I am far from convinced that the traffic commissioners are the ideal people to do that job. My right hon. Friend the Secretary of State said today that the Bill would stop bunching, but how can we control six operators who arrive within one minute of each other at the same bus stop without taking control of the timetable? If we take control of the timetable we are not deregulating but altering the method of regulation. I ask my right hon. Friend to take that on board.

The idea that competition will always be the best thing is not borne out by current circumstances in Hereford, where the National Bus Company, by competition, is destroying the competition of the independent operators. It is doing that with a grand total of 22 buses in the Hereford bus depot. Unless each National Bus Company company is to be cut to less than 22 buses, such action would occur throughout the country. Utterly unregulated competition can lead to its own demise.

As for inspection, at least one traffic commissioner reckons that we shall need at least twice as much inspection as we have at the moment. I am waiting for some reassurance from the Government that that will be provided. It is exceedingly odd that people who want to apply for a heavy goods vehicle licence have to prove their financial stability before being granted a licence whereas no such requirement will be necessary to run a public service vehicle if the Bill goes through in its present form.

As to concessionary fares, I am sorry to disappoint some of my right hon. and hon. Friends, but the chairman of Hereford and Worcester transport committee agrees with me that bus passes are difficult if not impossible to apply when there is a large number of operators. In those circumstances, it is almost certain that token systems will be necessary. Tokens only cause resentment.

The Parliamentary Under-Secretary of State for Transport (Mr. David Mitchell)

What does my hon. Friend mean by a "large number" of operators making bus passes difficult to operate?

Mr. Fry

If the chairman of Hereford and Worcester transport committee thought it difficult with four or five operators in Hereford, I suggest that there must be many other parts of the country where the same will apply if the Bill goes through in its present form. I am merely taking the advice of those who ought to know.

My hon. Friend the Member for Hereford (Mr. Shepherd) has mentioned the north Herefordshire women's institute. It violently opposes the Bill and feels especially strongly on one issue. It believes that the county council should retain an important role in public transport. It is worried that removing the council's responsibilities will result in a deterioration of rural routes.

I should like to conclude by considering the fundamental issue. As with everything else, the fundamental issue is finance. The Association of County Councils—I am sorry to keep quoting it but I hope that my right hon. and hon. Friends appreciate that it is not hostile to the Government or our party — says that it would require a minimum of £30 million extra to keep services as they are today. If we add that £30 million to the lowest estimate of cross-subsidy being spent on non-profitable routes—about £120 million—we arrive at a loss, if cross-subsidy is ended, of £150 million. That has nothing to do with London, the PTEs or the metropolitan areas. It relates entirely to the shire counties, which many of my colleagues represent. Therefore there is a real danger that that money will not be forthcoming and that councils will find it difficult to maintain the current level of services. Obviously, there could be an improvement in efficiency, which could result in lower fares on busy routes, but I and most people involved in the intricacies of transport finance doubt that it could also provide for the loss of cross-subsidy.

Almost a year ago I listened to the Secretary of State when he spoke at the Bus and Coach Council dinner. He made it abundantly clear that his main determination was to reduce the amount of public money spent on subsidising the bus industry. I do not necessarily disagree with him. However, I cannot understand why we need this Bill to attain the objectives that he wants. Competition can be extended by competitive tendering. My right hon. Friend might even consider negative tendering on certain routes. But privatisation of the NBC is already impossible. If he reduces the NBC to too many units, some of his ex-hon. Friends at the Treasury may have some words to say about the sum he receives from the public in exchange for it.

My right hon. Friend can control the spending of the PTEs. There has already been a change in transport supplementary grant. Already there is legislation to abolish the metropolitan counties, and he could replace them with any regime he wishes. All that is possible without the Bill. However, if we are to have the Bill, it needs considerable amendments. It needs amendments on tendering, licensing and the role of county councils, and there must be a great deal of reassurance on the question of finance. Without those amendments and that reassurance, I fear that the legislation, although welcomed by Conservative Members, may be viewed as the reforms in the Local Government Act 1972 are viewed. What appear to be a number of reforms may lead to an increased number of problems.

The Government have the opportunity in Committee to put right some of those points. I shall listen carefully to my hon. Friend the Parliamentary Under-Secretary of State when he replies. If he assures me, as I hope he will, that he will wait for the Select Committee report, and that he is prepared to accept meaningful amendments, I shall not vote with the Opposition. However, I warn him that if the Bill emerges from Committee in its present form, I shall have no hesitation in voting against it on Third Reading.

6.33 pm
Mr. J. D. Concannon (Mansfield)

I am aware of the time and the fact that a huge chunk of it has been taken from the debate. I am grateful to my hon. Friend the Member for Crewe and Nantwich (Mrs. Dunwoody) and to the hon. Member for Wellingborough (Mr. Fry) for their comments, which will enable me to cut my speech even shorter than I intended. The hon. Gentleman's speech showed the worthiness of Select Committees. He has examined the legislation closely and warned his right hon. and hon. Friends on the Government Front Bench of the dangers. If his amendment is rejected, he will suffer what we on the Opposition Benches have been suffering for a long time. If it is rejected, I hope that the Government will be sufficiently gracious to ensure that it is reconsidered in Committee. However, I should not like to guarantee him that, considering the content of his speech.

During the general election I wondered what the right hon. Member for Cambridgeshire, South-East (Mr. Pym) meant when he said that he was worried about the Government having a large majority. As an ex-Whip I could hardly understand that because I had always thought that the larger the majority, the easier a Whip's job would be. Since then we have discovered that the right hon. Gentleman was absolutely right. A large majority means bad legislation. We have had to get used to democratic dictatorship. Some Bills that have been introduced have depended not on argument or content, but on the size of the Government's majority to force them through. They should never have seen the light of day, and if the Government's majority had been about 50 or less they would never have seen the light of day. This Bill is one of them.

The Bill has nothing to do with services, and a great deal to do with party dogma and the dogma of the Secretary of State. He could not care less about safety, concessionary fares, services, routes or even job losses and the growth of moonlighting that the Bill will encourage. The Parliamentary Under-Secretary of State does not need to visit Phoenix, Arizona to find out what happens when taxi services are turned loose. He will remember from his stint in Northern Ireland, as I do, what happened to the taxi service and buses there. He knows the anxieties of insurance companies about the way vehicles are maintained and driven. I look forward to his reply.

The hon. Member for Wellingborough warned the Government about sensitive rural areas, and about the membership of various county councils. There have been rumblings among county councils and county councillors. The Government must accept that the Bill will be a major issue in the county council elections in May. Certainly in Nottinghamshire, where we are proud of our bus services and of what our county council has done for rural bus services, there is already consternation, and there will be more. There has been expansion there. It is not true that people in built-up areas do not care. The majority of councillors in Nottinghamshire county council, who represent areas, such as Mansfield, Bassetlaw and Ashfield, care. They could sit back and say, "It will not affect us very much", but to my surprise those councillors are more against the Bill than some Conservative county councillors. They seemed to acquiesce, but of late they have started to wonder about the political rumblings of people in those areas.

I have received stacks of briefing notes about this matter and others from my county council. I am obliged to my hon. Friend the Member for Crewe and Nantwich and to the hon. Member for Wellingborough that I do not have to discuss those matters now. I made a promise to make my speech as brief as possible, and so I shall. I hope and trust that if I am fortunate enough to be a member of the Committee—that is volunteering beyond the call of duty—this piece of political dogma will be considered thoroughly and properly on behalf of the people who will have to use the buses. I agree with the hon. Gentleman that there is no doubt that all the informtion that one can glean about the matter shows that there is a great deal of worry and consternation. I hope that the Committee stage will not be based on straight party political dogma. As I said, the county council elections will thrust this matter to the front of politics. I hope that the matter will be considered seriously. If not, the Opposition hope that the other place will again do its duty on behalf of the people who live in rural areas.

I have not gone into the nitty-gritty of the Bill, because it is not necessary for me to do so now. I promised that my speech would be short. I did not think that it would be as short as this. If we do not defeat the Bill tonight, which is what we want— we can win all the arguments but lose the vote—I hope that we shall take the Committee stage seriously.

6.40 pm
Mr. Simon Coombs (Swindon)

It gives me great pleasure to follow the right hon. Member for Mansfield (Mr. Concannon) and my hon. Friend the Member for Wellingborough (Mr. Fry), who have demonstrated across the Floor of the House that there can be some consensus. Had I been called by you, Mr. Deputy Speaker, a little earlier, I might have said that some of the remarks of the hon. Member for Crewe and Nantwich (Mrs. Dunwoody) would have driven me away from that consensus.

It is fair to say that the Bill is a radical and imaginative set of proposals. It is right that the House should consider on Second Reading the Government's justification for those proposals, and I believe that they have made a case, at least initially, as to why some changes are necessary. The statistics for the decline of the bus industry are spectacular. In three decades from 1951 to 1981, total passenger miles in Great Britain increased threefold, while bus and coach passenger miles decreased by a half. A 51 per cent. share of the market became an 8 per cent. share. Why was that? The growth in car ownership was equally remarkable, if not more so. That has provided a competitive pressure that must make nonsense of the idea that the bus industry is a monopoly. Competitive pressure from the private motor car is the most important consideration in judging how to deal with the future of the bus industry.

We must recognise another major change in social habits during the past 30 years. In the 1950s, the British were cinema-goers; in the 1980s, they are television-watchers. In the 1950s, local bus services could rely upon a third daily peak in travelling habits—an evening peak to be added to the morning and late afternoon peaks. When cinema attendances decreased, the financial viability of buses changed dramatically. As the cinema declined, so did the profitability of the bus industry. To that can be added the change from a six-day working week to a five-day working week, which also affected the viability of the industry. We must consider carefully the statistics of the past 30 years before assuming that all the blame for the decline lies with the bus industry.

The key to the Bill is clause 1, which will unlock the vast, rambling edifice of subsidy that has been built up over the years in the bus industry. Action is undoubtedly needed on this front. However, my quarrel is not with the bus industry, but with local politicians, especially those of the Left wing. The bus industry has fallen into their hands in many areas, and it has consequently suffered. Indiscriminate subsidy which seeks to prevent fares from increasing in line with inflation has done nothing to protect the industry from the competition of the motor car; it merely sucks resources from the local community in the form of rates. To the extent that clause 1 will lead to a reduction in subsidy, it is to be welcomed. Furthermore, the elimination of cross-subsidy implicit in the Bill should lead to lower fares.

In my constituency those who live in areas of Swindon such as Penhill and the Parks estates, who have low incomes or none at all, have been encouraged to believe by the opposition to the Bill that they will have no bus services in the future. On the contrary; they will be pleasantly surprised when fares are reduced. Why should they—the less well-off in society—subsidise those on higher incomes in areas where the motor car is a readily available substitute?

I wonder whether the Government realise the extent of cross-subsidy in the bus industry. If they have not yet had time to read the report of the Select Committee hearing evidence from the National Bus Company, I urge them to do so. The report makes it clear that £20 million to replace the money lost through cross-subsidy will not be nearly enough to meet the requirements of the industry, if it is to maintain present services.

May I say something about the effect of competition on the environment in which we must live. The conscientious transport manager—I have known many in my years in the industry—is constantly seeking to do two things. He will endeavour to amend services from time to time to meet changes in passenger demand, because he dislikes empty buses and he dislikes passengers being left behind at stops. He will also try to plan an integrated network of routes to cover his area. Attacks on monopoly and vested interests are misplaced. It is in the interests of passengers to have a planned, integrated network of services on which they can rely, especially when they have no alternative means of transport. To the extent that the competition inherent in the Bill will hinder such planning, it is to be regretted. Passengers will not thank the Government for lower fares if dislocated services follow behind.

In this context, I would welcome a reassurance from my hon. Friend the Under-Secretary of State when he replies to the debate that the successful tenderer for a loss-making and, therefore, publicly subsidised route will be protected for a reasonable period from speculative competition. Such protection should not be necessary in normal circumstances, but its availability would engender confidence.

The proposals in clause 6 could provide the framework for a sensible regulation of the new system. It empowers the traffic commissioner to determine "traffic regulation conditions" to prevent dangerous traffic conditions or reduce severe traffic congestion by controlling routes, stopping places and lay-over times. In extremis, the traffic commissioner must have the power to refuse an application through a regulation which adequately safeguards the environment by banning a service in a sensitive area such as a town centre bus interchange point which is already over-congested. Conversely, I hope that the traffic commissioner will use clause 6(4) (d) to ensure that operators will offer services of reasonable fullness on a daily and weekly basis. That would provide a framework within which competition can flourish and the passenger benefit, as hon. Members on both sides of the House would wish.

I am sure that the Government do not wish to encourage cowboy operators, unsafe vehicles or stranded passengers. However, if they are to avoid those possibilities, they must strengthen the proposals. A framework for competition was considered right by the Government when British Telecom was liberalised last year, and a similar approach is entirely justified here.

I welcome the Bill's proposals to free the National Bus Company from state control and to reduce restrictions on the hiring of taxis. I welcome the drive to extend the flexible provision of transport into rural areas where profound social changes are taking place. There is a positive benefit to the nation in maintaining the rural population. I would also welcome a commitment from the Government to public transport in its true sense — transport for the public, not transport owned by the public. We need stimulation of fixed rail, overhead, underground and water-borne transport to reduce pressure on the road network.

The Government do not wish to destroy public transport, as has been suggested by the Opposition, but they want — rightly in my view — to reduce its costs. These proposals are at the least risky and at worst a clear threat to the level of public transport that we need, particularly in our towns and cities, to make the best use of our road networks. If the Government would consider fixing an upper limit to the permissible level of subsidy—say, at 10 or even 5 per cent. of income from fares, excluding concessionary fare contributions — it would meet the need to reduce public subsidy and would make enemies only among the far Left of the political spectrum.

To sum up, the Secretary of State reminds me of a character I once read of in a John Buchan novel who showed his bravery by going from a lighted room into the dark beyond. The Secretary of State has undoubtedly seen the light but he is now setting off into the darkness on an unknown path. There he may bump into the hon. Lady the Member for Crewe and Nantwich, the spokesman for the Opposition, which will be frightening enough, but he will also come up against some hard realities and some uncomfortable facts. The Secretary of State should travel carefully with the Select Committee's report under his arm, lest he should never arrive.

6.51 pm
Mr. Ted Leadbitter (Hartlepool)

The hon. Member for Swindon (Mr. Coombs) began his speech by referring to an imaginative and realistic set of proposals that had been produced by the Secretary of State. He then referred to regulatory provisions that ought to be introduced in order to temper somewhat this state of imagination and realism. That is a dichotomy of thinking which in my experience is an attempt to back two horses at the same time when they are running in different directions. However, the hon. Member for Wellingborough (Mr. Fry) was far more constructive and realistic and showed a profound knowledge of the subject matter. The right hon. Member for Mansfield (Mr. Concannon) gave a crowning piece of advice, good sense and caution arising out of his ministerial experience in Northern Ireland.

We are left with the Secretary of State for Transport. He has been here for a long time, but he appears to have learned nothing. He has behind him many years of experience but they do not appear to me to reflect great credit upon him. Wherever he has been he has left behind him concern and destruction. He is a devastating character. He is the only person who has followed persistently the proposals contained in the White Paper and who has ignored the practical advice and experience of all those who are involved in the operational and administrative aspects of transport. These sources have put forward an overwhelming case against the Bill. The Secretary of State clearly is the odd man out. It is a very lonely position in which to be and illustrates the pathetic state of the Secretary of State's case. He is anchored to dogma. He knows that deregulation and competition turn back the clock to the period before the 1930s. Regulation, licensing, co-ordination and all the other trappings of a public transport service in the United Kingdom have come into existence since the Road Traffic Act 1930. The Secretary of State has been warned from all sides that times have changed. The transport problems of today cannot be solved from the experience of the past.

The Secretary of State is returning to the conditions of the 1920s. He is not looking forward. The future development of our transport services requires a modern approach that involves planning, co-ordination, co-operation and support in the national interest, but the 1980 Act got rid of certain licensing procedures.

What has happened? The Secretary of State boasts in his White Paper that bus services have improved and that fares have been reduced. However, on examination we find that the picture is not as the Secretary of State paints it. Much of that traffic has been taken away from British Rail. Consequently, British Rail needs further financial support in order to meet its increasing overheads.

However, the Secretary of State is adamant and has tried to pretend to the House that he has put forward a constructive set of proposals.

The Secretary of State wants to introduce something that is, as yet, untried. Nothing in the Bill has been tried and tested. There is no evidence to support what the Secretary of State wants. Furthermore, what is counterproductive he actually denies. What is unworkable he scorns. He refuses to admit that the Bill puts at risk the quality, availability and efficiency of local bus services. Sadly, we shall have to wait and see what is the degree of his recklessness.

All that we have before us now rests not on a better transport policy. If that had been the case, we should have had before us a measure that reflected the experience of well-established bus operators and the experience of county councils, district councils, passenger transport executives, the National Bus Company and the Bus and Coach Council. The private and public sectors would have been partners in assisting the Secretary of State, if that had been his policy. Instead, we have expenditure cuts presented in the guise of lower transport costs. Just as surely as this policy has damaged the education service, housing programmes and social services and has forced additional costs upon ratepayers, so in this case ratepayers will he faced with higher costs and poorer services.

The abolition of road service licensing will break up a well-established network of services. The urban areas will suffer and the rural areas will be further deprived. The needs of both will have little priority in the scramble that the Bill invites. I am afraid that this applies also to standards, safety and the environment. Cross-subsidy—the provision of services that no private operator will provide—will be lost. No town is without the problem of providing a service that is socially important but which is unable to produce adequate revenue. The provisions contained in the Bill fail to meet the problem. The case is well demonstrated by the debate on 25 October 1984 in another place.

Part IV of the Bill is an exercise in muddled thinking. District councils are expected to transfer their well-organised bus undertakings to separate companies. What has been developed by public demand, criticism, social needs and accountability is to be handed over to municipal companies. However, those districts councils will remain burdened with public sector spending and investment responsibilities.

Municipal companies of this kind will immediately face unfair competition, and in this regard the Secretary of State can say nothing to deny the damage that we foresee. Eventual inconvenience will be a further consequence to passengers, in addition to a higher cost to the ratepayer. It is clear that all this will result in grave losses to the community.

The first will be the scrapping of the present road licensing system. That has been well tried and has been described as a useful instrument for the development of good services. That will go, as will cross-subsidies. The National Bus Company and municipal bus services will be broken up. The obligation on county councils to co-ordinate public transport will also disappear. There will be widespread reductions in service levels, and whether or not the Secretary of State admits it, there will be an increase in fares. That is bound to happen. A poorer quality of service will result, with a lowering of safety standards and job losses in existing undertakings.

I am advised, and I have no reason to doubt it, that the Bill will remove power from local government but that direct powers in many areas will be taken by the Secretary of State. This approach reverses the policy, previously endorsed by all parties, that local decisions should be taken locally. The Bill superimposes an alarming amount of ministerial control, often without further reference to Parliament.

I ask the House to consider the enormity of that. This Government presented themselves to the country in 1979 and 1983 and boasted about the amount of choice and non-intervention in local government. They were telling the electorate, "We will set the people free." Yet since 1979 we have had a most abrasive Government who have indulged in daily intervention and have dictated to industry, voluntary organisations, individuals and corporations alike. They have become an arrogant Government. They will not listen.

We have already heard from the well-informed hon. Member for Wellingborough (Mr. Fry) how the Secretary of State has had the audacity to appear before a Select Committee—charged under its terms of reference with scrutinising and monitoring Departments—and after two and a half hours took no notice of its comments, even though they related totally and wholly to the subject matter in the Bill. No operating undertaking is listened to. In other words, everyone has wasted his time.

I am sorry to say it, but as usual the people will have to suffer the consequences of the Government's actions. However, time will tell, and this Government, through the person who seeks to emulate his Prime Minister more than anyone else, will again be proved wrong.

7.4 pm

Mrs. Elaine Kellett-Bowman (Lancaster)

I very much welcome the Bill. Over the years I have received many complaints about buses, especially in my rural areas. Only last November, a large headline appeared in my local newspaper drawing attention to the fact that a parish council was complaining bitterly that its bus service was "diabolical". It was absolutely right. Only a fortnight ago, an article in the local newspaper which was titled "First catch your bus" complained that passengers wanting to get from Garstang to Scorton boarded a bus marked "Scorton"—a reasonable thing to do—only to be turfed off a few minutes later by a bus driver who said that it was going nowhere. They finally tracked down the right bus, even though it was wrongly labelled. As the writer of that article said, it is hardly surprising that the Scorton-Garstang bus is under-used and that on an average Thursday you could fit the passengers into a mini, let alone a mini-bus". Small wonder that in Lancashire over the past 10 years, bus usage has shrunk by 46 per cent. and bus mileage is down by 14.3 per cent. while the revenue subsidy—this may delight Opposition Members — has risen from £93,000 to £8.5 million. This money has come out of hard-earned wages.

That is why I welcome my right hon. Friend's courageous efforts to provide passengers with decent bus services which go where they want to go, not where it is convenient for the bus company to take them, and at a price they can afford. I say "courageous", because my right hon. Friend knew very well that he was tackling not only the vested interest of the huge National Bus Company and the local authority bus services, which do not want their effortless, comfortable monopolies swept away. More difficult, he was also tackling the "When in doubt cling to nurse, for fear of getting something worse" syndrome, which is exemplified on the Opposition benches.

However, even when people complain like mad about something, they still fear change. Believe it or not, the very parish council which complained that its bus services were diabolical was frightened of change. By then it had the expensive benefit of the Labour-controlled Lancashire county council's propaganda campaign against the reform proposals. One can get a lot of propaganda for 135,000 quid, including a photograph of the county council chairman in all the local newspapers. I understand that it will shortly be on the back of all the buses. That is a mighty useful election gimmick—just before the county elections — at ratepayers' expense. But following Westminster's successful case against ILEA, this expenditure may well prove to be ultra vires, and Labour councillors may be liable to pay it. It may also mean that she has opened her election campaign.

The fears which have been aroused are precisely those that were felt when the experiment in Herefordshire was about to begin. There are no such fears there now. Everyone is delighted with the service, and no one wants to return to the old ways.

It has always seemed such a waste of public money to have taxis with one child in them, or health service transport vehicles going around the country half empty. Therefore, I particularly welcome clause 80 which makes the services co-operate to achieve better value for money for ratepayers and better services for passengers.

Shared taxis, provided for under clause 9, will give the flexibility which buses lack and, provided they are full, at little, if any, higher cost then buses. There is no doubt that travelling in from a country district is now expensive.

Country areas do not need large buses. Nothing annoys people more than to see huge buses containing only one or two people lumbering around country lanes, when a minibus would to a better and cheaper job. When I have suggested this in the past, I have been told that the bus grants system made it no more expensive to buy a full sized bus than a minibus. If that is so, it certainly needs altering.

With new, flexible services and the grants for services in rural areas available under clause 89, I believe that the country dwellers in my constituency will get a much better deal.

Much deliberately misleading rubbish has been talked about concessionary fares. Clause 85 makes it abundantly clear that concessionary fares are in no way threatened, and local authorities can operate schemes as they think fit. I was glad that the Secretary of State answered a Labour allegation that it would be impossible for local authorities to run concessionary fares schemes, either because they will have no money to do so or because it will be difficult to operate a scheme when large numbers of private operators are involved. At present many of my constituents who would be eligible for concessionary fares cannot use them because there is no bus service going where they want to go. Under the provisions of clause 86 any operator can tender to operate such concessions and the improved availability will benefit people in areas with poor services, including my old-age pensioners in inaccessible top-of-the-hill council estates.

One of the most illogical attacks on the Government's proposals has been on the safety aspects of buses. During the running-in period in Hereford, a lot of faults were found in buses, which were put off the roads by inspectors. This, of course, is exactly what tests and inspectors are for. I welcome the tightening of conditions for vehicle maintenance in clause 23 and the provisions to disqualify operators who operate dangerously or go in for such practices as bunching, so common now in all conurbations; the buses always run in flocks.

It is astonishing that the very people who profess to be worried at the imagined prospect of unsafe private buses on the road appear not at all worried by the published figures, given to me the other day, of safety test failures of National Bus Company vehicles. A failure rate of 40 per cent. on the first test in National Bus Company buses in the year 1983–84 is nothing to brag about, and the stricter standards will be welcome all round.

I appreciate that there is understandable anxiety among the staff of the National Bus Company and local authority undertakings, but there is also keen anticipation, and many employees are looking forward to getting a share of the action. Their appetite has been whetted by the knowledge that the employee-owners of the National Freight Consortium have seen their share in the consortium rise from £800 to £6,000, and it is still rising. Moreover, the consortium is able to plough back far more into new investment than the old company, so that is good for jobs in the manufacturing sector as well. The same applies to Tyne Shiprepair, doomed when nationalised and losing £12 million, but which now, after a workers' buy-out, has doubled its work force and is making a profit, so staff need not fear privatisation.

The Times summed it up splendidly when it said that the Government seek to eliminate quantity control while retaining quality control and to provide subsidies more related to need. All in all, I welcome the Bill and hope that my right hon. Friend will be in no way deterred by the orchestrated clamour that has been raised against it.

7.11 pm
Mr. Donald Stewart (Western Isles)

I am amazed at the cavalier way in which the hon. Member for Lancaster (Mrs. Kellett-Bowman), like some other hon. Members on the Government Benches, has said that if no buses are available one can always order a taxi. Anyone who knows what it costs to order a taxi in my constituency to go to hospital or to an airport will realise that it is not something that people can do every day of the week.

In his peroration the Secretary of State said that we cannot shirk reform. The use of that phraseology suggests to me that some unpleasant medicine is to come. A few may benefit, but most people will find the contents of the Bill very unpleasant indeed.

I cannot be the only Member who has asked why a Bill of this size and detail could not have awaited the report of the Select Committee on Transport. I was glad that the hon. Member for Wellingborough (Mr. Fry) dealt with that question adequately and in some detail. This is an important issue for the House. Although we know that Government are not bound by the findings of these Committees, at least they might recognise the time given to them by Members. If this is to be the pattern, in time it will be difficult to get Members to serve on such Committees.

When the White Paper, the precursor of the Bill, was issued last autumn, it was clear that the Scottish Office had merely accepted the views of the English Department of Transport. My party, the Scottish National party, said then that if the proposals were implemented they would be ruinous to the existing network of Scottish bus services, because feeder services and urban services to housing schemes are in a completely difference position to the lucrative express services and services on main routes. If the profitable routes are hived off under the deregulation proposals, their profits will not be used to cross-subsidise the services to rural areas and outlying areas of housing which, although loss-making, are socially necessary. I was disappointed to hear it said that people in towns would not agree to pay for losses in rural areas. I think many councillors have a more responsible attitude than that to their duties.

My party has made it clear that we believe the White Paper proposals to be extremely damaging to Scotland. Our transport needs are different and are often based on a dispersed population in rural areas. These conditions are rarely mirrored south of the border. If anything, it can be argued that Scotland needs greater rather than less co-ordination of public transport.

On cross-subsidisation, I understand that the Scottish Office has said that a new rural grant will be introduced to cover the transitional period when such subsidies are being reduced. I would be interested to hear more details of this; perhaps the Minister will be able to provide them tonight.

The evidence gathered by the Scottish consumer organisation suggests that the proposals in the Bill are not welcomed in Scotland. That organisation has reported that, following a wide-ranging survey, only one private bus operator fully supported the proposals. Regional authorities within Scotland, of all shades of opinion, have heavily criticised the Bill.

It is also worth noting that the Government are pressing ahead with the legislation on the basis of no practical experience in Scotland. Experiments in deregulation have been carried out in England but there have been none in Scotland. In regard to the Scottish dimension, we are taking a great leap in the dark. I fear the consequences will be damaging. If the Scottish Office is determined to press ahead, it would be worth while considering at the very least a longer time scale for implementation of the plans and perhaps also the need for controlled experiments.

Many questions remain unanswered or not sufficiently answered. What additional resources will be made available to make up for the loss of cross-subsidy? What will happen in rural areas, like my constituency, where there may not be competition in tendering for a service? Will the local authority have to accept a tender which is considered very high? I hope that these questions can be answered by the Minister.

The Bill reflects the Government's zeal to allow market forces to prevail, regardless of the consequences. My suspicion is that their principal motivation is not to improve bus services but further to reduce public spending and to stamp their own brand of ideology firmly on the public transport system. The Scottish interest demands that the Bill should be opposed, and I shall vote for the amendment.

7.17 pm
Mr. Colin Shepherd (Hereford)

I am grateful to you for calling me, Mr. Speaker, and I hope that you will make a rude noise if I wander near my time limit.

As I have listened to the contributions so far I have been reminded very much of the difference in attitude portrayed by two shoe firm representatives who went to Africa. The first one sent a telegram back saying, "Opportunities appalling; nobody wears shoes." The second one wrote back saying, "Opportunities absolutely magnificent; nobody wears shoes."

We can take a totally negative view on this exercise or we can take a positive view. Anybody confronted with the basic figures which show that there are far fewer passengers, far less bus mileage and far more money ploughed into maintaining this creaking structure has to say either that we do not do anything about it but dig deeper in our pockets, confident in the knowledge that the situation will deteriorate, or that we take a constructive view that something has to be done. I take the view that no responsible Government, confronted with the figures, can do anything other than address the matter seriously. The state of affairs is so serious as to warrant major attention rather than minor tinkering with the structure. That is the basis on which I view the Bill.

I have the pleasure to represent Hereford, which has been the subject of a trial bus deregulation for the past four years. It might be helpful if I briefly set out a few of the things that have happened in that trial. There are those who have approached this in a negative way, and have said that the trial has caused problems. I think that it has been a valuable experiment from which much valuable information has been gathered if one wishes to look at it in a constructive manner.

I do not know whether the National Bus Company, which has the main service in Hereford city, is typical of other bus companies in other parts of the country. However, before 1981 if I wanted to get nearly lynched, I went into High Town and asked people how long they had been waiting for the bus. I had a string of complaints — the bus did not turn up, the bus did not stop, the company did not bother., When I complained to the driver, I would be told to get on down to the back of the bus. When I asked Midland Red (West) Ltd. why the bus had not turned up, I was told that there was no driver or no engine or that it could not get spares. It was not a happy state of affairs.

The county council's figures show that in 1975, £87,000 was spent in supporting buses, and in 1983, £867,000. That is three times as much in real money terms. Before the experiment, there were declining services, especially on Sundays and in the evenings. As a consequence of deregulation in Hereford there is competition from smaller operators, although this took a little time to start. There are, in general, reduced fare levels, and in some cases they have reduced substantially. More important, this has induced people to travel on the buses more often, which cannot be bad. On a personal note, the flow of complaints has dried up. Furthermore, I cannot find a queue of people waiting for buses in the city. They have gone because they are on the buses, which again is not a bad thing.

My right hon. Friend the Secretary of State mentioned subsidies, and in Hereford the subsidy has gone down by 38 per cent. If one adds in the amount of saving brought about by sensible use and co-ordination of school transport, we are talking about double that amount. If one saw that lying on the floor, one would bend down and pick it up. It would be worth while to do so because double 38 per cent. is a lot of money in anybody's terms.

All this has been done without reducing bus mileage in rural areas. We have commercial services operating without subsidy on routes that were previously operating with subsidies. We have managed to deploy ratepayers' and taxpayers' funds in such a way as to operate bus routes without a subsidy.

This is not necessarily just a cost-saving exercise, and my right hon. Friend the Secretary of State said that the Bill is aimed not at reducing subsidy but at making possibly better deployment of subsidy. If the county council wishes to put more services out to tender, to change the structure of the bus services, it can do so. It is significant that the same level of bus mileage—or 2 per cent. higher—can be sustained for less subsidy.

Mr. George Walden (Buckingham)

I admire the tenor and spirit of my hon. Friend's speech, and he has had a great deal of experience. Has there been any difficulty when services have been put out to tender, the tender has been accepted but competition continues and the operation becomes difficult?

Mr. Shepherd

The question has not arisen because, as the service has been put out to tender it is, by definition, a difficult one, and the operator of the service runs it. No one has been interested in coming in in competition because it is recognised that there is not the volume of passengers for two companies. Potential competitors have turned their attention somewhere else.

Safety standards have been rigorously enforced in Hereford. We have had chapter and verse quoted about the failure of the safety standards, but that is because of the rigorous enforcement of the inspection of vehicles. We cannot, and I do not want to, complain about that. That is as it should be. Nobody should enter into this game unless his vehicles are in good nick and he can keep them in good shape. He must recognise the name of the game before he comes in. I pay tribute to those who have come in, who have learned their lesson the hard way, who are succeeding and who are determined to stay in.

It would be wrong to say that we have not had problems. There have been environmental problems, buses have bunched and have been standing over. However, in developing this Bill, my right hon. and hon. Friends have sought to overcome this problem. One can either throw the baby out with the bathwater and say that this problem is too difficult to solve, or one can say that the prize for solving it is enormous and therefore, solve it we must. There must be a constructive approach to resolve the difficulties that result from the nature of the competition. The provisions of clause 6 are essential in this respect.

What has been the competitive reaction? Midland Red (West), the National Bus Company in Hereford, set out to win the competition. It has massive resources and its buses were operating only on what were seen to be the effective routes. It improved its performance by 25 per cent. and its attitudes to the customers changed. People riding on buses in my part of the world say, "Do not let this go back to where it was because the bus operators will stop being nice to me." That is a small point, but it reflects through the whole ethos of bus operations. The customer matters. We should be thinking of him because buses are about customers.

The Midland Red (West) has tried hard to swamp competition, as has been said. Massive numbers of buses were poured in to try to swamp the opposition and wipe it out. However, if the company had to compete on all fronts it would not be able to pull buses in to try to obliterate the competition. As it is, the company underestimated the determination of travellers in Hereford to sustain two bus companies on routes.

At the moment we have what I am told by the Opposition is a disaster. Midland Red (West) tells me that it is making money like it has never made it before, without taking a penny in subsidy from Hereford. It also told the Select Committee and Ministers that. The independent companies have no wish to leave the scene. The ratepayers, via the county council, are paying less money and the level of fares is lower, so for the most part buses are serving passenger needs better and more efficiently.

Mr. Roger Stott (Wigan)


Mr. Deputy Speaker (Mr. Ernest Armstrong)

Order. The hon. Member for Hereford (Mr. Shepherd) has had his 10 minutes, so there is no time for interventions.

7.27 pm
Mr. Stephen Ross (Isle of Wight)

We are grateful to the hon. Member for Hereford (Mr. Shepherd) for giving us his experiences. I think that he will agree that Midland Red (West) Ltd. accepts that it was providing a rather poor service before competition was brought in, but it has managed to pull up its socks since then.

I shall not attempt to argue that there is no need for competition in the bus industry. Nor shall I pour cold water on the idea of further experimentation to reduce the costs. These are obviously necessary. However, I seriously question whether a Bill running to 114 clauses and seven schedules is necessary to achieve those ends when we already have the Acts of 1980 and 81 on the statute book. Some of the remedies proposed in those Acts, certainly those of the Public Passenger Vehicles Act 1981 have not been fully tested.

It would be foolhardy to rush into this measure so soon after the publication of the White Paper, which was only last July, particularly in view of the huge numbers of concerned representations that have been sent in by the various and varied interested bodies. The Select Committee alone received more than 160 detailed depositions, and more are still coming in. It is regrettable that we could not get our report out before this debate, because I believe that there is a reasonable chance of achieving a fair measure of cross-party agreement on at least some of the proposals. I support the amendment so ably moved by the hon. Member for Wellingborough (Mr. Fry).

I am afraid that the Government, in their almost total but naive belief in market forces, think that such policies will solve all our problems. This measure will, however, unnecessarily destroy what is in many parts of the country a very fine bus network. I include the service in my constituency in that description. As far as I can discover, only The Times fully supports the Secretary of State. That is not surprising and is no commendation under that newspaper's present management structure.

It was claimed at Question Time recently that the Association of County Councils fully supported this measure, but its latest brief hardly bears that out. The Secretary of State has certainly stabbed the association in the back, despite the cosy chats at Marsham street with Councillor Ron Carrington of the Hereford and Worcester county council. Because he pioneered the Hereford area trial, the Department should have listened to his views. Once again, under this Government, locally elected representatives are to be made the unhappy whipping boys of the Department of Transport, while the real power passes directly to appointed bodies — in this case, the traffic commissioners.

As a member of a county council and a former representative on the ACC, I believe that it is high time the ACC took the gloves off in dealing with this Administration. As the association rightly says, it is a grave error not to give the counties the registration function with powers selectively to grant protection to subsidised services against the creaming off of profitable traffic by competition on the road. The co-ordinating role provided under the Transport Act 1978 is greatly weakened by the measures in the Bill, and the traffic commissioners' remoteness will not help.

The success—such as it was—of the Hereford trial area, even down to the publication of timetables, owed a great deal to the county, its chairman and officers. I accept that there are successes, but there are also disappointments. In fact, only two private operators are left, one of which is supposed to be pulling out. The Secretary of State should have taken much more notice of the county's representations. The county put a great deal of effort into that scheme and deserves some credit. Its co-ordinating role will be diminished to a large extent by the Bill.

It would have been far more sensible if a trial in an urban area had been pursued first. For example, in Plymouth outside consultants have been employed. In a detailed report, which I expect hon. Members have received, those consultants cast grave doubts on the costs and claimed advantages mentioned in the White Paper. They calculate that the proposed changes could increase rates in Plymouth by 22 per cent. They remark that Plymouth boasts a good bus system that costs the ratepayers relatively little. That is the case in many other parts of the country. Why destroy that system?

The outcry against cross-subsidisation is levelled especially at rural experiences. Insufficient attention has been given to the desirability of cross-subsidisation in urban areas. The changes will impose severe difficulties and certain cuts on my constituency. We unashamedly increase charges in the summer to pay for winter services. At present, about £500,000 of cross-subsidy comes from some of the profitable services whose profits are made in the summer months. That cross-subsidy, added to the £250,000 subsidy from the Isle of Wight county council, is needed to retain the uneconomic services. If the socially desirable services are to be saved by the Isle of Wight county council, the council would need to treble its present subsidy by taking money from the rate support grant. That could happen at a time when local authorities have less money available to them from central Government. The £20 million extra from the Government will do nothing to alleviate this problem. I believe that about £100 million would be more realistic. Even the Government's figures seem to show that at least £60 million is necessary.

Deregulation of taxi operators outside London is highly dubious. Such a scheme certainly did not work in parts of the United States. Privatisation of the National Bus Company by splitting it into smaller operating units is unlikely to be successful. I believe that the proposed break-up of the municipal public transport authorities is a retrograde step, especially in a place such as Tyne and Wear which, by common consent, has built up the finest co-ordinated transport system in the country.

The future of concessionary fares does not bear thinking about. It is time that the House insisted on the rest of the country being treated like London. Unfortunately, that measure was not written into the Tory manifesto at the last election. Undoubtedly, existing schemes and through booking arrangements are at great risk, especially if my Sealink experience is anything to go by—I suspect the members of the Select Committee expected me to make that point. Great difficulties have been experienced trying to maintain through bookings. Concessions for disabled drivers have been virtually removed.

I am concerned about the inclusion of clauses 94 to 100, which relate to rail services. I know those measures were included because of suggestions by a previous Select Committee. I believe that the time has come to halt all rail closures and even to reopen some lines. Our small overcrowded island cries out for a comprehensive rail network. The continuing chapter of hideous road accidents should persuade us of the need to preserve these priceless assets. We require more, not less, co-ordination; more, not less, co-operation; and more, not less, local involvement.

If enacted, the Bill will cause chaos. It will unnecessarily destroy what is good and replace it with an inferior product. It will lead to altercation and interminable disputes into which the police will inevitably and unnecessarily be drawn. I suggest that that is the position in Hereford. The Bill may lead to cheaper fares in the short run but, in the long term, the consumer, wherever he lives, will come to cuss the very mention of the name of the Secretary of State.

7.35 pm
Mr. Robert B. Jones (Hertfordshire, West)

I warmly welcome the Bill. We have seen an era of declining bus services and rising costs. They have been reflected in the rising subsidies that have been necessary.

I started in local government a long time ago at the age of 22 on St. Andrew's burgh council. During the first year in which I was a member of the council, Alexander's bus service, which is part of the Scottish Bus Group, asked for a subsidy for the first time. That bus company was given a subsidy. The next year it came back for more, and so on. No attention was paid to whether that service was provided in the best and most efficient manner possible. I believe that a stimulus is required to make such companies examine better ways of operating.

Not surprisingly, there has been a decline in rural services because of increasing car ownership. That has occurred partly because the ordinary public believe that it is desirable to own a car and partly because of necessity. There are unreliable bus services in the towns. I receive many letters—my hon. Friend the Member for Hereford (Mr. Shepherd) has received such letters also—from constituents complaining that a bus due to arrive in their area of Hemel Hempstead did not turn up one morning. Sometimes the reason is a lack of drivers or maintenance, but often the reason is that a bus driver has slept in and has driven straight on to the next set of stops. That is unacceptable. When I ask people in factory canteens about the biggest problems in Hemel Hempstead, the inadequate bus service is their main criticism.

In contrast, we have the experience of the deregulation of the inter-city services. I am surprised that my right hon. Friend the Secretary of State did not mention the incredible success of the commuter coach services, especially around London, which have been of great benefit to my constituents and have resulted in their being able to continue to work in London. They would not have been able to afford to stay in their jobs if they had been forced to rely on an out-dated and inefficient public transport system. That is the scene behind the White Paper and the Bill. Proposals have been made for extensive deregulation, but I believe that it is important to stress that we are not considering total deregulation. The proposals rightly pay attention to the need for more safety regulations.

There are, or should be, two objectives in our policy. We must have a more reliable, flexible and less costly service for the consumer, and secondly, we must make sure that we give the public the best value for money.

For the consumer, safety is probably the absolutely essential requirement, so I welcome the Government's commitment to an increased regime of safety requirements. I make two further points on that score. First, if the safety inspections are to be effective, the penalties must be swift and there must be no question of matters dragging on as a result of a contested appeal system. Secondly, I commend to the Secretary of State and to my hon. Friend a three-tier system in which an operator could lose part of his licence for one route or his licence for all the areas in which he is operating under this Bill, or could lose his operating licence for all bus services whether under this Bill or not.

On flexibility, much has been said about the ability to introduce taxis or minibuses as an alternative to buses, but little has been said about the possibility of co-ordinating rural bus services with the school bus network. Here, I believe, there are possibilities of real savings. During the past fortnight in my constituency, a rural route running from Potten End to Hemel Hempstead was cut by the county council. It was replaced immediately by a private contractor who, because he was operating on a school run, was very willing to continue during the rest of the day to provide a service for the ordinary passenger wanting to go and shop in the town. The service is now more regular than ever it was before the county council service stopped.

The evidence concerning prices is staggering. The most comprehensive report is the 1980 production by the United Kingdom Transport and Road Research Laboratory. It produced the statistic that the mean fare in areas covered by private bus services was 25 per cent. lower on rural and inter-urban runs than in areas covered by public sector contractors. This is hardly surprising. The reasons were that they used lower-cost premises, had greater flexibility of staff, including part-timers and mechanic-drivers, had more one-man operations and used more small vehicles—a correct response to the market.

As regards value for money, I believe that the prime consideration should be competition. If the same or a better service can be provided at the same or a reduced cost, that is the essential test of efficiency. But we must make sure that that competition is fair and frequent. It is no good having competition with municipal bus services if they are not putting their assets in their accounts at a proper valuation or are in various other ways seeking to lower the costs that would appear in a normal private sector company's accounts.

Similarly, it is no good having large undertakings able to buy routes. Therefore I welcome the proposals of my right hon. and hon. Friends for breaking up the National Bus Company. However, I must ask why this does not apply to London, where, above all, it is needed.

I want to put a question to my hon. Friend on creaming off services, which I hope he will reply to in winding up. How would the competition requirements work where, say, the middle part of a route might well be profitable whereas the two ends would, under the present system, be unprofitable? Surely the answer is to make sure that the route is treated as a whole and is subject to competition.

This Bill will be a tremendous advance for the bus passengers in my constituency. I am sure that they will find they have a better service, as has already been proved in the one area which has undertaken to operate a private sector service in advance of the Bill.

I commend this Bill to the House.

7.45 pm
Mr. Gordon Oakes (Halton)

We have heard in this debate about the effect that this Bill will have on passengers, and I think that there will be quite devastating effects, particularly in rural and suburban areas. My hon. Friend the Member for Crewe and Nantwich (Mrs. Dunwoody) explained, quite rightly, the effect that this Bill is going to have on road safety. I should think that in the chaos that will result from the operation of this Bill thousands of people will be injured, maimed or even killed in the rat-race competition that will exist on the roads. It is the biggest setback to road safety that has ever come before this House.

I do not want to pursue those lines in the limited time available to me, because I speak as a sponsored Member of Parliament of the Transport and General Workers Union, which is the union most affected, and indeed a member of the passenger branch of that union. I want to talk about the impact that this Bill will have on the jobs of drivers, conductors and inspectors in the PTEs, in the municipal bus undertakings, in the National Bus Company and, not least, among taxi drivers, whether employees or owner-drivers. They have not been mentioned a great deal in this Bill and they are seriously affected by its provisions.

The whole Bill is quite explicit that manpower will be reduced, and it is my contention that this will be effected by severe reductions in services. Certainly the services will exist on the more profitable routes, as has been said in the debate, but in the rural and suburban areas services will disappear altogether—that will be the effect of this Bill—and jobs will be lost as a result.

On the question of manpower, the explanatory memorandum states: Public sector manpower will decrease by some 50,000 as a result of the transfer of the operations of the National Bus Company to the private sector; a further decrease is expected as a result of improved efficiency in public sector bus operations. What that means is that services will be cut.

On page ix, it is stated, in reference to the public sector: the transfer of the bus operations of PTEs and of district and regional councils to companies will involve transitional costs (mainly on professional fees) of about £1m. Where competition causes a reduction in the scale of some public sector operators, there may be redundancy costs. There will be redundancy costs on a very large scale indeed. Let us take the 50,000 employees of the National Bus Company, that highly successful, efficient and profitable nationalised industry which the Secretary of State is aiming to destroy. Clearly the Government do not envisage that all 50,000 will merely change their employer. Jobs will go. The competitive successor companies will not run routes to rural villages. They will not run in the evening or on Sundays. It would be quite contrary to their purpose so to do because their raison d'être is to make a profit, not provide a service. So many more thousands of jobs will be lost in that sphere.

The same applies to the companies which will succeed the municipal undertakings. They will not be competing fairly with the privateers. The Secretary of State has seen to that in this Bill. They will be competing with one hand tied behind their backs, waiting for the day when the successor companies that he has created disappear again entirely into the private sector.

The privateers are in this business for profit, not for the comfort, safety or convenience of passengers. They will cut down to the bare minimum that they can get away with in questions of maintenance and cleanliness, because not to do so would reduce their profits. The people they employ need not be full-time bus men. As long as he holds a PSV licence there is nothing to stop a driver working for a number of firms or working in a completely different occupation at night or during part of the day and then moonlighting as a driver for low wages and in bad conditions. Does the Secretary of State know the sort of wages that many private coach operators pay their drivers? The men are often paid pin-money wages in the hope that they can make up their wages in tips. These are the people who will be the first to jump at the pickings to be had from becoming privateers under this Bill.

Indeed, the Bill recognises that there will be lower standards. Clause 81(3), which deals with tendering for subsidised services, says quite specifically: An invitation to tender under this section may not include conditions with respect to the terms of employment of persons to be employed in providing any service to which the invitation to tender relates. They must not even look at service and the conditions of the drivers in the particular industry.

I have already mentioned taxis and taxi drivers and hire cars. Clause 14 takes away powers which have existed for nearly 140 years to limit the number of taxis. What will be the effect of this on, for example, the owner-drivers so dear to the Conservative party? Many people in my constituency invest their redundancy pay in taxis. Are we to have unlimited numbers of taxis plying for hire on the roads? Many will go out of business. Their owners will lose their livelihoods and their businesses. That will be the effect on them of unbridled competition.

Some of the Bill's provisions are ludicrous. Let us take the provision in clause 9 that deals with carrying passengers at separate fares. As a result, needless competition with buses will be created. I ask hon. Members to imagine the situation at 11 pm on a Friday or Saturday night, when four people sharing a cab all want to go to different destinations. Who will be dropped off first? Who will be dropped off last? Who is going to pay what? Which direction will the taxi take first? After squabbling and fighting with one another, the passengers will probably all turn on the poor taxi driver. That is the effect that clause 9 will have.

By any standards this is a bad Bill. I agreed with the hon. Member for Wellingborough (Mr. Fry) that even if the Secretary of State wished to pursue his mania for privatisation, he could have done so in a far better way. For example he could have considered franchising. I would not have supported that, but the fact remains that he should not have wiped out road service licensing, as he has done in the Bill. The only thing that gives me some comfort is that if the Bill is enacted it will come into operation on 1 October 1986. It will take six to 12 months for the chaos resulting from it to come home to the people, and the effects will particularly hit those in the rural and suburban areas. That means that their dissatisfaction will coincide with the date of the next general election. Conservative Members will have many difficult questions to answer in those constituencies affected, and will probably lose them as a result of going through the Lobby tonight.

7.50 pm
Mr. Tim Eggar (Enfield, North)

Whenever I listen to trade-union sponsored Opposition Members, I reflect on what their forebears would think of them. Those who came in in the late 19th century full of radical ideas that were right for their time have been succeeded by people who oppose every change and are the most conservative Members of Parliament.

My right hon. Friend the Secretary of State has rightly chosen the most radical option open to him — the introduction of competition into an area that has become almost synonymous with monopoly. Slowly and imperceptibly over the past 50 years the bus services have come to be run for the benefit of the operators and their staff and not for the benefit of the customer. Too often timetables are suited to vehicle availability and not to consumer demand. Too often urban and rural bus routes owe much more to history than to present requirements.

Nor is it surprising that monopoly operators' costs are considerably higher than those of the private sector. There is no spur to efficiency. Whenever losses increase, they simply go back to their sponsoring councils and ask for an increase in their annual subsidies. For them there is no danger of lost jobs or of a visit to the bankruptcy court. For many years there has been no true competition.

It is not only the operators whom we must blame. Far too often councils of all political persuasions have forked out subsidies without proper scrutiny. For some councils, particularly in the municipal areas, a subsidised and inefficient public transport system has become part of their political creed and has become necessary for dogmatic reasons, at whatever cost. Others have either bowed to local political pressure on routes or have simply failed to compare the subsidy required by their operators per mile with those of similar operators in other parts of the country. They have simply failed to use sensible housekeeping techniques.

We cannot say with absolute certainty what will happen as a result of the Bill. Competition breeds uncertainty and the market's reaction is unpredictable. However, like other hon. Members, I can say what is likely to happen. We know what happened with the deregulation of long-distance routes. We know that many new routes have come into being, that there has been a real fall in the level of fares and that there has been a dramatic increase in the number of passengers. We have heard from my hon. Friend the Member for Hereford (Mr. Shepherd) about the happy experience in the Hereford trial area. We know about the experience in Norfolk, where the same service was run for a considerably lower subsidy. We also know that the National Bus Company and other public sector operators have considerably higher costs per mile than their private sector competitors.

So the evidence is that there will be an increase in the services available and a decrease in the subsidies needed as a result of the Bill. Yet we must bear in mind that replicating the success of the Hereford trial area and of the long-distance coach deregulation depends crucially on the detailed implementation of the Bill. For example, there would be little point in simply denationalising the NBC as a whole. That would simply create a private sector monopoly where we previously had a public sector monopoly. If we are to obtain proper competition, the NBC must be split into a number of relatively small units. They must be small enough so that they can be bought by local management and employees, and so that their size and ability to absorb interim losses does not deter private sector operators from entering the market. Yet they must be big enough to compete with the municipal operators and the PTEs.

There is no ideal size for any one part of the country, but each different unit must be looked at from the standpoint of the market, and the competition in the area. My right hon. Friend the Secretary of State must make it clear to the management of the NBC that he will judge its proposals on its ability to increase competition alone.

My right hon. Friend must also be careful about the way in which he allows councils to tender for routes. We have seen evidence in the NHS of the way in which tendering terms can be rigged to favour the in-house work force. There is a danger that unless my right hon. Friend is extremely careful, the same sort of factors will operate in tendering for bus routes. Through the tendering process, my right hon. Friend must ensure that we maximise competition. He must not be afraid to react very quickly to enforce the splitting up of the large municipal operations and the PTEs where that would increase competition.

I firmly believe that the Bill will result in better services, lower fares and lower subsidies, and that it will be good for the consumer, the taxpayer and the ratepayer. But the passage of the Bill will not, in itself, guarantee that. I look to my right hon. Friend to ensure that he takes every decision with a view to increasing competition.

7.57 pm
Mr. Harry Cowans (Tyne Bridge)

I apologise in advance to the House because I am a member of a Committee that is sitting upstairs and I shall not be here to listen to the Minister's concluding speech.

I would have found the speeches of many Conservative Members more credible if there had been some sign at the beginning that the reasoned amendment would be accepted. The Select Committee took evidence from passengers, operators and others involed right across the industry. The Secretary of State would have us believe that people really want the Bill. He could easily have proved that by accepting the reasoned amendment. All the evidence would then have been available to hon. Members, who could have made up their own minds on the matter. But the truth is radically different. If the Minister does not intend to accept the reasoned amendment, there is an onus on him to prove that the Bill will work.

On the balance of evidence presented to the Committee, at least there were expressions of grave concern, many of which came from bodies that normally support the Conservatives, and at worst there was outright opposition. But alternatives were proposed also. The amendment asks that the report, of the Transport Committee be made available to all right hon. and hon. Members so that they can make up their minds on the evidence presented to it before the Bill is enacted. We are not asking for a great deal. I speak now as Chairman of the Select Committee on Transport. We worked long and hard and we took advice from everybody who asked to appear before us. The benefit of that evidence should be made available to the House.

What are we asking the House to do? The Committee will be in a position to present its report to the House within the next two weeks and all the evidence for and against could then be made available to hon. Members. That is all I wish to say as Chairman of the Committee.

If the Minster is not prepared to accept the amendment, I can draw only one conclusion, that he does not wish right hon. and hon. Members to have the benefit of this information before they make up their minds. When the Minister winds up, I hope that in his opening words he will say that he accepts the amendment.

I acknowledge that the Bill states that people can operate concessionary fare schemes. Of course they can. But what good is it to have a brand new pass tucked in one's top pocket or handbag if the service one wishes to use no longer runs? That is precisely what happened in Hereford. Five and six buses arrived together, with large gaps between the services. Conservative Members may laugh, but I shall quote one of their supporters, a busman who went to the other place. Referring to Hereford, he said: There are not enough passengers to justify the number of buses which fill the narrow streets of Hereford, upsetting the shopkeepers and others. It is perfectly obvious that there is wasteful competition. The position is unstable and it must be a matter of surprise that it has continued in this way for so long. That was one of the Government's supporters speaking, yet Conservative Members have the audacity to try to convince the Opposition of the rightness of their case. This same supporter said of the trial area in Hereford: But, looked at as a prototype for the rest of Britain, scrutiny of this gem shows that it is no more than paste."—[Official Report, House of Lords, 25 October 1984; Vol. 456, c. 307.] I think that we would all applaud that. As to the Tyne and Wear metro, is it not ironic that there was a system that was the envy of the world—even the Minister and the Secretary of State thought that it was a marvellous concept, and have said so—yet the co-ordinated transport system which made it possible is to be removed from the local authority? Surely if one believes that something is marvellous, one does not remove the means of building it up.

There is no provision in the Bill to deal with the congestion that will occur in city centres. The objective of private operators is to make a profit, and they will pick up the lucrative routes and operate at the peak times. As a result, there will be a massive build-up in city centres with no controlling provision in the Bill. This will lead to a free-for-all. If the Government are so worried about the consumer, they might give a passing thought to the pedestrian.

There is no sense to the Government's argument on the rural lines. The Conservatives forget that it was they who changed the legislation. It was they who made it easier for a person to obtain a licence by application to the traffic commissioners. The only criterion applied by the traffic commissioners under the previous legislation was that, as long as it was not against the public interest, the applicant could be granted a licence. If that is so, where are the queues of people making application under the provisions of that Conservative legislation? I was a member of the Standing Committee which considered that legislation in its passage through the House. At that time, the Conservatives claimed that people would flock to apply for licences. The Conservatives sponsored that legislation, yet they now have the audacity to complain about the lack of rural services. That legislation did not work, so it is back to the drawing board. But I have news for the Government: this Bill will not work either, and it will be back to the drawing board once more. In the meantime, the people whom the Government are allegedly looking after—the poor, the weak and the disabled—will be deprived of services.

Who on earth wants to run a bus service that does not make a profit? Conservative Members talk about free competition. It is an irony that it is all right for the local authority to subsidise those services on which it cannot make a fast buck, but the Government will not permit competition in a free market. The Bill is concerned with hiving off the lucrative runs for private enterprise, with the local taxpayer having to pick up the leavings.

Even the Minister did not claim, as did the hon. Member for Enfield, North (Mr. Eggar), that Hereford was a success. Nor, indeed, did the White Paper claim that it was a success. Does not the hon. Member for Enfield, North find it strange that not one trial was undertaken in a major conurbation, yet it is the major conurbations which will have these schemes thrust upon them?

I believe that, just as happened in the case of the Local Government Bill, it will not be long before this matter is back for consideration in the House when the Conservatives have mail bags full of complaints from people who cannot get buses, and once again it will be back to the drawing board.

It is not too late to amend the Bill and to consider the options that will emerge from a study of the report of the Select Committee. I have heard Conservative Members claim many times that they will put the country back on its feet. I did not realise that this was how they intended to do it.

8.10 pm
Mr. Matthew Parris (Derbyshire, West)

There were good reasons for the hon. Member for Tyne Bridge (Mr. Cowans) — the Chairman of the Select Committee on Transport — not being able to visit Hereford and Worcester, and I do not criticise him for that. However, I' went there and what I saw convinced me that the experiment in that area had been a terrific success.

I am a member of the Select Committee, as is my hon. Friend the Member for Wellingborough (Mr. Fry). I do not think that it was right of him to talk about Hereford and Worcester in the way that he did and about the reservations that some people expressed about some of the effects of deregulation, without at least mentioning that everyone to whom we spoke who actually used buses was convinced that the experiment had improved matters and did not want to return to the previous system.

Mr. Stott

When the hon. Gentleman visited Hereford and Worcester, did he speak to the planning officer of the city of Hereford and obtain his views? I have met that gentleman on no less than three occasions, and he maintains that the experiment in the city has put back environmental improvement for at least 20 years. He said that the experiment was a total disaster.

Mr. Parris

Members of the Select Committee spoke to many members of the council, and I think that the planning officer was a member of the panel that we interviewed. I asked the panel members whether they used buses. Not one of them did, other than a Liberal councillor to whom the other members deferred for experience of how services had improved under deregulation.

I shall not vote against the amendment moved by my hon. Friend the Member for Wellingborough, because I, too, regret the fact that the Government are going ahead with Second Reading before they have had time to see the report that the Select Committee will produce shortly. However, I shall not withold my support for the Second Reading of the Bill because I am sure that deregulation will bring real benefits to the bus industry and its passengers.

Let us imagine that Britain did not have a system of free competition for the sale of food and household goods. Let us imagine that county council policy — quite understandably—was to seek to ensure that each locality was served by one adequate licensed grocer's shop. In return for the award of an effective monopoly, the county council quite properly attached to the licence conditions relating to the range, quality and price of the goods and the hours of opening of the shop. The argument for monopolies—quite plausibly—would be that it would be inefficient to duplicate facilities. The argument for attaching conditions to a licence—equally plausibly—would be to prevent the abuse of monopoly.

Let us imagine that it was common practice to grant licences to operate groceries in profitable populated localities on condition that the grocer was prepared to accept groceries in unprofitable areas where the shops met a social need, but where no reasonable profit could be made. Let us imagine that the Government of the day proposed to deregulate that market, allowing people to set up groceries wherever they liked, often in competition with each other, some even—if I may make such a preposterous suggestion—next door to each other. What would be the reaction? I think that I would be right to assume that deep alarm would be felt on both sides of the House and throughout the country.

A Select Committee, genuinely anxious to hear from all who wished to testify either for or against the proposal, would have invited testimony. Learned men would have volunteered—professors and retailing consultants. They would have explained why the supposed benefits would not have materialised. They would have said that the demand for over-the-counter groceries was not elastic— one either needed a bar of soap, or one did not. They would have concluded that prices ultimately would be pushed up, not down, as a finite volume of trade was spread over an expanding number of outlets and retailing hours.

The shop workers' union would have given evidence. The spectre of bucket shops, part-time grocers, amateur grocers and moonlighting grocers would have been raised. After that, the Committee would have taken evidence from the local authorities. It would have been genuine, earnestly felt evidence. The men who gave it would have been intelligent and hard-working people, convinced of the value of their labours. They would have told us how they were using their licensing powers creatively and imaginatively to promote standards of social provision, good practice, helpful service and adequate stocking.

Their evidence would have been persuasive. They would have told spine-chilling stories—true stories—of pirate corner shops overcharging, of cut-throat competition, of elderly people being confused about prices, weights and measures, and they would have raised the spectre of the get-rich-quick grocers creaming off the profitable passing trade in Tizer and fairy cakes, leaving the good old licensed stores to look after the old people, the housewife and the sale of pints of milk and loaves of bread where no easy profit could be maintained. They would have said that only a licensing system could sustain such practices. They would have assured us that it would be a mistake to put our faith in a free market for the sale of groceries.

Our faith would have been shaken further by a delegation from the Association of Trading Standards Officers. Its evidence would have been grave and sincere and full of foreboding. Disinfection, refrigeration, stock turnover and due respect for sell-by dates would all have been earnestly discussed. Salmonella would have been mentioned in passing. They would have suggested that food standards would be the first casualties in a trading war between grocers. They would have said that when the war was over the newcomers would revert to high prices and low standards, and the county would have lost its licensing authority to prevent that.

Hot on the trail of the counties would have come the metropolitan authorities. They would have explained the integrated retailing policy that they had developed in their areas — the right shops in the right places; shopper representation on the board of every store; consumer education to encourage wise purchasing policies by the shopper and a controlled distributive trade to ensure the minimum number of lorries to deliver efficiently. They would have detailed all those great benefits, and the eyes of the members of the Committee would have opened wide at the thought of all those great benefits being threatened by deregulation.

My hon. Friend the Member for Wellingborough would have stepped forward, olive branch in hand and said, "Let us admit that all has not been as it might have been with the grocery trade. Let us confess that certain stores could be better run and that some supermarket chains have taken licensing authorities for a ride. But gentlemen, we can deal with that in a civilised way without all the vulgar instability of a free-for-all. Let franchising for the running of shops be put out to competitive tender. Let the bargaining and the cut and thrust of competition take place not on the streets with shoppers as the hostages, but in the smoking room, between county councils and the established grocers."

What would the Committee have concluded, having heard all that evidence? Would it be conservative and advocate the retention of the status quo, or would it have dared to be radical and recommend the excitement and uncertainty of competitive tendering for a grocer's licence? Only time will tell. All that can be said with confidence is that, having considered whether there should be a free-for-all in shopkeeping, with two or even three grocers competing for the same custom in the same area, the Committee would have heard little to convince it that such a regime could possibly be acceptable, and much to persuade it that it could not.

When members of the Select Committee were in Hereford and Worcester, seeing for themselves the effects of deregulation, as I came out of the meeting having heard an afternoon's evidence, a lady bus passenger asked me whether she could give evidence. I said that it was unlikely that the Committee would hear her unless she was part of a body or represented an organisation. She asked how she could tell the Select Committee that the bus passengers in the town approved of deregulation. I suggested that she asked people to sign a petition. She walked out of the hotel foyer, and in the next post to London came a petition with 100 signatures from people who used the bus service to that lady's council estate. All of them said that the service had improved immeasurably since Midland Red (West) Ltd. had lost its monopoly and that they did not want a return to the previous position.

I know that my right hon. Friend the Secretary of State believes, as I do, in a free market, and I know that he has faith that the free market can bring benefits. One journalist says that he is batty. If to believe that human beings may not operate at their best when their efforts are not open to challenge by others makes one batty, I am proud to call myself batty, too, and to vote, as I shall, for the Bill's Second Reading.

8.19 pm
Mr. David Marshall (Glasgow, Shettleston)

I wish to oppose the Bill. First, let me declare an interest as a sponsored member of the Transport and General Workers Union and a former bus worker. In addition, in my constituency there are two bus garages — Parkhead, which is one of the largest in Strathclyde PTE, and Baillieston, which is a Scottish Bus Group garage. Many hundreds of my constituents depend upon the bus industry for their livelihood. Thousands more depend upon public transport, as many of them do not possess or have access to a car. In parts of Glasgow, 70 to 80 per cent. of the population have no alternative to public transport if they want to go anywhere.

In my constituency, adult unemployment is over 30 per cent. and goodness only knows what the youth unemployment level is. Good, reliable, cheap public transport is an essential if people are to have a reasonable quality of life.

In his opening remarks the Secretary of State referred to my prediction of five years ago. What the then Secretary of State failed to do, the present Secretary of State seems determined to do with this Bill — to destroy public transport in Britain. My prediction may not be so far out. Only time will tell.

There is a simple reason for the decline in the use of public transport. People who have the use of a car prefer to use it and the vast majority will continue to do so, even if public transport is free. The car is the most popular form of transport and there is nothing wrong in that.

However, it is those who do not have access to a car whom we want to attract on to public transport, and we want them to make as many journeys as possible. It is the Government's economic policies which have created over 4 million unemployed, which has had the greatest effect on public transport, in the past five years. Unemployed people do not travel to work and have a greatly reduced need to travel for leisure, recreation, culture, shopping, visiting, and so on. That, in turn, affects the viability of many routes and services as well as the entire community. Get people back to work and we shall see great increases in the demand for public transport.

Let me pay tribute to the hundreds of thousands of working men and women who operate public transport services of all kinds in this country—services which we all take for granted. Transport workers have a difficult job, working all sorts of hours in all sorts of conditions, such as the weather that we are presently experiencing, yet they seldom fail to operate the services. They face the continual stress and responsibility of driving in all kinds of conditions, serving the public, and, unfortunately, the ever-present threat of assault and abuse. In addition, most of them have to work overtime, including rest days, to earn a reasonable living. I should love to see the Secretary of State out at 4 am in freezing conditions or driving a bus until midnight on a Saturday and Sunday. It might even change his attitude to transport workers.

What is the Secretary of State's attitude to transport workers? What thanks are bus workers to get for providing over 50 years of relative stability in their industry? No thanks whatever. In fact, a kick in the teeth is much more likely. Clause 76 enables the Secretary of State to make regulations for compensating persons for loss of employment or loss or diminution of emoluments—in other words, redundancy or less pay and poorer conditions.

Privatisation will be a disaster for the bus industry. Proper co-ordination will become impossible, putting an end to integrated timetables, through ticketing, through services and nationwide marketing. Cross-subsidy will be impossible, so many services will be reduced or withdrawn. Over 50,000 bus workers will be transferred to the private sector without any choice as to who their new employers will be. Jobs will be lost, union agreements torn up, pension schemes, sick pay and holiday agreements put at risk, and hard-won terms and conditions of service thrown out of the window.

The sad thing is that all that is unnecessary. The National Bus Company is making a profit, has repaid Government loans and improved productivity. Its crime is that it is succeeding as a publicly owned company and that is unacceptable to the Secretary of State.

It is most unlikely that new small operators will purchase new buses. It is much more likely that they will buy reject old vehicles from the NBC or PTEs. However, if they do buy new vehicles they are more likely to be imported than is presently the case. Has the Secretary of State estimated the effects of the Bill on companies such as Leyland and Alexander's Coach Builders? How many jobs will be lost in that respect as a result of the Bill?

I wish to deal with some Scottish aspects of the Bill, in particular, the Scottish Bus Group and British Rail services within Strathclyde region and Strathclyde PTE. The Secretary of State has said that he has no plans to privatise the Scottish Bus Group at present. Everyone believes that it is only a matter of time before it will be privatised. Why does he not come clean and tell us his true intentions now? It is not in the best interests of the company, the work force or the passengers not to know how long the company will be allowed to operate as it is at present.

The Strathclyde rail review is the result of long negotiations between British Rail and Strathclyde region. The Bill could mean the disintegration of the review. That will lead to an adverse effect on British Rail's income so that it will have to find more and more ways of keeping costs down. Therefore, there will be more and more service reductions or withdrawals, especially in the evening. It will mean taking a new look at many services such as the electrification and investments proposed for the Glasgow to Ayrshire corridor. If the main routes between Ayr and Glasgow are to be ripped off by cowboy operators, what chance is there of improvement in real services? What is the point of British Rail spending millions of pounds if cowboy bus operators are to cream off all the profits?

There is also the unanswerable environmental aspect of the proposed electrification schemes. In addition, the A77 Glasgow to Ayr road is one of the most dangerous in Scotland and the last thing that we need are convoys of clapped out buses on that road. What will the Secretary of State for Scotland tell his constituents if the Ayr electrification scheme does not go ahead because of the Bill? It is most disappointing that he is not present in the House when matters affecting Scotland are being discussed.

Transport operators work from 4 am to midnight, not from 8 am to 6 pm as would be the case for many new operators. The effect on integration tickets, transcards, interlink services and feederlink services will be detrimental in Strathclyde.

If deregulation is the answer to all the transport problems, why is London being left out of the Bill? I am not arguing for it to be included, but is that not rather inconsistent? Or does not the Secretary of State believe in his own proposals? However, he is content to break up Strathclyde's transport system, and could conceivably cause 1,000 jobs to be lost in that area.

Strathclyde contains many uneconomic urban bus routes which will not attract the proposed subsidy for rural services. In October I asked the PTE for information on the costs of all its services in Glasgow. Let me quote from the director's reply: it is broadly fair to say that on the last available figures out of 67 services only 4 more than recovered their total costs, 4 were broadly break even while the balance required support. Of this balance of 59, 11 were of such a social nature that their revenue earned did not recover 50 per cent. of their costs. What will happen to those services?

Strathclyde has the lowest level of bus support in conurbations throughout the United Kingdom. It is at the forefront of the development of microbuses in some of the largest housing schemes in Europe. Another new development is the swap body concept for rural transport. We also have the metroliner, new city buses and a door-to-door dial-a-bus service. Most important of all, it has the first specifically designed double-deck vehicles capable of carrying disabled passengers and operating on regular day services.

Strathclyde has a comprehensive system of concessionary fares. It covers 5,000 square miles and serves half of Scotland's population. I can foresee that literally hundreds of new operators will emerge as a result of the Bill. It will not be possible to have a properly operated system of concessionary fares. The public are bound to suffer as a result. Many rail services and bus innovations are at the development stage and need protection from predators if they are to succeed. They need time to become established.

If London is to be excluded from the Bill because of special circumstances, an equally good case can be made out for Strathclyde. Why does not the Secretary of State exclude Strathclyde from the Bill for the time being to give it the same opportunities as London? Will he give the House an assurance that he will reconsider the position of Strathclyde?

There are three main objectives behind the Bill, none of them concerned with providing better services to the public. It seems to undermine trade union organisation and solidarity in the transport industry; to undermine local government even further and to cut public sector manpower and create further reductions in public expenditure at the expense of those less fortunate members of the community—the non-car-owner, the non-driver, the old and the young, the handicapped and the disabled, the unemployed and the poor.

I am grateful to Councillors Laing and Meldrum of Strathclyde region for providing me with a brief of the effects of the Bill on the disabled in Strathclyde. Presumably, the disabled face the same problems in other areas. Time allows me to quote only one paragraph, but I should be happy to let the Secretary of State have a copy of this three-page document. It says: With the development of an uncoordinated system of public transport, with many different types of vehicle being used, it will be difficult for a disabled individual to plan a journey. For example, a blind person may not know whether he enters the bus from the rear or the front; a person with a locomotor impairment may not know whether he can get back from a journey if the bus changes from a low floor coach to a high floor coach. There is also the problem for the mentally handicapped, who may have been on courses to familiarise themselves with the bus system. After privatisation, they may have to use a more unfriendly service which creates a more hostile and stressful environment." I urge the House to oppose the Second Reading.

8.30 pm
Mr. David Maclean (Penrith and The Border)

I warmly welcome the Bill, and I shall confine my remarks to part I, which is concerned with bus deregulation.

Critics of the Bill argue that it will bring a loss of services. All that we have heard from Opposition Members today is that we must protect the status quo. We have heard nothing about how to improve rural, indeed any, services. Not even did the Liberal spokesman, the hon. Member for the Isle of Wight (Mr. Ross)—who has done the usual Liberal thing of making a short speech and scuttling off—want more than the status quo.

What is the status quo that Opposition Members want to perpetuate? Patronage of buses and coaches in Britain has halved since 1953, down from 82 billion to 40 billion passenger kilometres per annum. The demand between 1972 and 1982 fell by 30 per cent., that at a time when the overall demand for transport was increasing rapidly. During that time, subsidies rose enormously. As the editor of one of the two excellent newspapers in my constituency, the Cumberland News, wrote—[Interruption.] He wrote a balanced editorial and he would object to Labour Members suggesting that he edits a Tory newspaper, considering that he is the vice-chairman of the Guild of Newspaper Editors and will be at the House of Commons tomorrow night to lobby us on the question of VAT; Opposition Members can tackle him then, if they wish. He wrote in a balanced editorial: In fairness, the Government is facing reality. For even in these days when figures of money sound like telephone numbers, the increase in bus subsidy in 10 years, from £10 million to more than £50 million, is truly staggering—and it has not controlled fares. I might add that it has not altered the decline in rural services, either.

Most criticism of the Bill has been about its effects on rural services. The hon. Member for Crewe and Nantwich (Mrs. Dunwoody) quoted the National Federation of Women's Institutes. Mrs. Anne Harrison, the chairman of that body, was quoted in my other excellent local newspaper, the Cumberland and Westmorland Herald, last week as saying: We are concerned that this legislation sounds the death knell of the rural bus. I respect the WI, but Mrs. Harrison's warning is 15 or 20 years too late. What rural bus is she speaking of? The newspaper reported her as saying: Commercial operators will swarm like bees round a honeypot to the busy town routes, leaving rural ones with no bus services at all. I have the largest constituency in England, 1,200 square miles, and what she fears has happened already; large chunks of my constituency have no services, and those with services have completely inadequate ones.

Are our critics arguing that we should freeze matters at their present levels? That seems to have been what Opposition Members have been arguing today. They have not spoken of how to halt the decline in rural and city services, just that we should leave things alone and keep the jobs for the boys. Any hon. Member who is arguing in favour of the present system of regulation is inevitably arguing in favour of a system which will gradually lead to the complete disappearance of all rural routes.

One must speak to people of a much older generation than that to which I belong to find someone who has seen buses in rural areas on Sundays. I hear Opposition Members talking about Sunday buses being affected by the Bill. We have not had Sunday buses for years. They have all gone.

Opposition Members complain that there might not be an integrated transport system enabling people to get home at night when they come off the train at perhaps 10 o'clock or leave the cinema. In most parts of rural Cumbria we have not had late night buses for years. The present system has given us precious few rural routes, and those that exist charge exorbitant fares.

I respect Opposition Members having to toe the line of the Transport and General Workers Union. It is legitimate for them to defend the rights of their members, but they must not say that they are concerned with rural services and the decline in bus services generally and go on to make bogus arguments about safety, concessionary fares and so on.

When the trade unions and others say that we must not interfere with the present system, they mean that scores of villages in my constituency should be condemned to the present system of not having any buses, or those that have buses should continue to have inadequate services. I have in mind the beautiful little village of Kirkoswald, which even now has only one bus a day. However, that village is well off compared with the neighbouring village of Dufton, which has only one bus each Tuesday and one each Saturday. But even that is better than the village of Roadhead, which has only one bus each Wednesday, like the village of Newbiggin, which has one each Tuesday. Those who live in the village of Dundraw must walk a mile in the hope of getting a bus passing on the main road.

Mr. Peter Pike


Mr. Maclean

I will not give way because I do not want to detain the House for more than a few minutes longer.

If Opposition Members are boasting that we are having the marvellous achievement of 50 years of regulation, since the 1930s, and that what we have is what state control and a fully integrated system has achieved, that is a hollow boast in my constituency—[Interruption.] I think I hear Opposition Members shouting that I shall not have my constituency for long. I assure them that my majority would have been 10 times larger had the Labour candidate not disappeared through the floor, so to speak, having lost his deposit.

We see the result of 50 years of regulation. Opposition Members should be ashamed of themselves for wanting to retain that. If the pattern of the last 10 years is repeated, most of the hamlets and villages in my constituency will not have any buses by 1995, even with massive subsidies, and the subsidy support over the years has been absolutely enormous.

In Cumbria, revenue support in 1974 was £115,000. In 1984 it was £2.345 million, an increase of 2,000 per cent. Even I do not condemn that per se. I would support an increase in subsidy of that extent, if it had worked and increased the number of passengers. However, in the same period the number of passengers using buses dropped by 23 per cent., from 88 million to 66 million, in the Ribble catchment area, which includes Cumbria.

Does anybody seriously suggest that that trend can be reversed? The answer is no. We have seen on the graphs how the number of people using the buses has declined: the line on the graph goes straight down. The line on the graph showing the number of passenger miles travelled also goes straight down. But the line showing the amount of subsidy support on an expotential curve goes straight upwards. Unless we take radical action now, we shall see the escalation of subsidies, fewer passengers and fewer jobs for bus drivers.

Cumbria has a population of 480,000, 26,000 of whom travel by bus to work. If the pattern from 1974 to 1984 was repeated over the next 10 years, by 1994 the bus subsidy for Cumbria would be £50 million. In other words, the subsidy given to each person travelling to work by bus would be £2,000 per person per annum. On that basis, it would be cheaper to buy each person a Mini Metro because over 10 years we should have given them £10,000 each to travel to work by bus.

Allowing for everybody else using buses, including those who travel socially, the subsidy would be £460 per person per annum. At that rate is would be cheaper to buy each of them one of Clive Sinclair's C5 trikes. Indeed, we could buy each bus traveller a new trike each year. It would be cheaper to do that than to pay the bus subsidy.

Mr. Allan Rogers (Rhondda)


Mr. Maclean

The hon. Gentleman should contain himself.

Another criticism of the Bill comes from vested interest groups. The Transport and General Workers Union claimed that safety would suffer when cowboy operators took to the roads. My constituents and I strongly resent that criticism of so-called cowboy operators. Private operators are already operating buses on school runs. If Opposition Members are calling them cowboys, perhaps they would care to come to my constituency, name names and allow the council to take action against the so-called dangerous cowboy operators. Critics of the Bill also refer to jobs. Of course jobs will be affected. But for how long do Opposition Members imagine that we can guarantee the job of every worker in the National Bus Company while the number of passengers that it carries continues to fall rapidly? We can only guarantee those jobs, and the jobs of others working in public transport, by persuading more customers to use the services.

The level of rural services has been declining and will continue to decline. The Government's plans for deregulation represent the last hope of safeguarding and improving our rural services. The decline has gone on for far too long. I will do my utmost to make sure that rural services are maintained and improved. The best way of doing that is to vote for the Bill, as I shall do. I urge all my hon. Friends to vote for it too.

8.42 pm
Mr. Terry Patchett (Barnsley, East)

My constituency has a strong interest in seeing the Bill defeated. I would have preferred the debate to take place on some other day as, ironically, I have had to cancel a driving test in order to speak in it. However, in Barnsley, East, being unable to drive is no great inconvenience, thanks to the cheap, efficient service provided by the south Yorkshire transport executive. The financing of that service has been made an issue by the Tories in many local elections, and they have been rebuffed by the vast majority of the local electors.

Three main issues affect my constituency. First, by choosing to put the Bill through, the Government are ignoring the will of the people. The electors of Barnsley, East have spelt out clearly their support for the present system. My constituents are aware of the dangers in a Bill that makes concessions to get-rich-quick cowboys and hives off the lucrative routes without any compassion for those using the less profitable routes. My constituents also know about the subsidies required to maintain services over all the routes, and in elections they have given those subsidies overwhelming support. My constituents are also aware of the benefits to the less well off that are obtained through the cheap fares policy of the south Yorkshire transport executive.

It is big businesses and the better off who scream for tax cuts and rate cuts, and it is they who are listened to by this uncaring and cynical Government whose policies in every field ensure that the rich become richer and the poor poorer. These are strange days for democracy, when the Government overrule the wishes of the majority of the people.

The second issue is the service itself. We have sensible fares that people can afford, free travel for pensioners, and real services in rural areas where, as the Government know, no private company would dream of providing them. Will the Minister explain how an out-patient who regularly has to attend hospital in town for treatment, but cannot afford a taxi, is to get to the hospital if the rural bus service is disbanded? Will the ever-increasing costs be borne by the county's ambulance services while the Secretary of State for Health and Social Security is gleefully cutting hospital services?

The south Yorkshire transport executive has special buses to enable the wheelchair-bound so get into town. Do the Government really believe that a private company will provide such a caring service?

Thirdly, there is the question of jobs. There are two main bus depots, one in Shafton and one in Wombwell. The depots employ several hundred people, whose jobs will be put at risk by the Bill. That will be another wound to a community in an area where the Government and the coal board are seeking to destroy the traditional mining jobs and where a disastrously high rate of unemployment is rising still higher. There will be an effect on jobs in the town centre as well, because of the infrequency of services and the higher fares that will be extracted for the benefit of private profit.

I am sure that other right hon. and hon. Members will tell us more about the issues in the Bill and the effect that it will have on the quality of their constituents' lives. I can only hope that the House will stop selling out to the greedy and start caring for the needy, by voting against the Bill.

8.45 pm
Mr. Conal Gregory (York)

Buses are a vital form of transport. Many people depend upon a bus service, as four households out of every 10 lack the use of a car, and yet the story of the bus service has been one of decline. Bus fares have increased by 30 per cent. more than either motoring costs or the cost of living, while, at the same time, services have diminished by some 15 per cent. Because there are fewer services and higher fares, fewer people take the bus. That vicious cycle can and should be reversed. The Opposition have attacked the spirit of competition. They will not squarely face the challenge of public bus transport provision. The Government will not shirk that responsibility. I support the principles enshrined in the Bill.

In two respects, the Government have the success of deregulation on their side. The long-distance coaches, attacked by Labour, have been set free, and that has resulted in some 700 applications for new services. That fact has been referred to only briefly by my hon. Friends and not at all by the Opposition.

Secondly, local bus deregulation has been shown to have worked in the trial areas of Norfolk, Exeter, Hereford and Worcester. The present system is not good for the bus user or the taxpayer. The Opposition say nothing about the limits on resources. The subsidy is hidden, for no one can see how much financial help is given to any specific route. The subsidy jumped from £10 million in 1972 to more than £500 million in 1982. Surely it is far better that we should see where the taxpayers' money is going. The subsidy should be visible and should go to needy services. Those services should not be hidden through inefficiency.

The present system stifles competition. The need for each local bus route to be licensed dates from 1930—the year of birth of the hon. Member for Crewe and Nantwich (Mrs. Dunwoody). After 55 years, the hon. Lady should recognise that it is necessary to move with the times. The title of the popular song of that year seems appropriate. The hon. Lady may recall it — "Time on my hands". That is exactly what the hon. Lady will have, as she waits for service under the present system.

The Opposition have not made one constructive suggestion for reversing the present decline. They are devoid of ideas. They will shore up inefficient, loss-making, overmanned monopolies rather than allow competition. Route licensing acts like a straightjacket. The present mini-monopolies stifle initiative. In York, for instance, the West Yorkshire Road Car Company tried —though it failed—to block a new service for tourists wishing to visit that fine historic city. The present operators have an air of self-satisfaction. They try to prevent the extension of services. I want more routes, better servicing and better safety standards. Over one fifth of buses fail their inspection stage, and that shows that the latter is essential. The Bill should make all those aims possible.

Hon. Members should consider the hidden subsidy on their own local services. How many York electors and York bus users realise that the present restricted service is subsidised by the taxpayer? How many realise that the subsidy has more than doubled from £162,000 in 1983–84 to £361,000 in 1984–85? Those figures do not take account of the £320,000 for old-age pensioner concessions. How much better it would be to offer concessionary fares to all operators. The Opposition do not mention that. That would help senior citizens and the disabled.

We need more flexibility in public transport. York has a park-and-ride scheme— a Socialist sop to a council that will not provide adequate car parking or encourage more effective modes. Private taxis and minibuses would have cost York ratepayers less than the council's bus undertaking.

There is a major area of bus policy that is not recognised in the Bill—a duty to ensure public bus mobility for the disabled. I hope that my hon. Friend the Minister will take this matter on board. When county councils issue tender documents, they should ask what provision bus operators have made for the disabled through improvements in vehicle design, in the provision of routes and in staff training. When a person gets on a bus, he is often confronted immediately by a high step or a lack of handrails. The layout of the bus might be unfamiliar and a blind or partially sighted person might not know how the seats are arranged. There should be greater use of the system in Coventry where tactile symbols on the bus entrance indicate the type of layout that passengers can expect inside.

We should encourage the low step to be found on some buses and training to assist the handicapped. The special funds that the Bill envisages will, after enactment, enable such steps to be taken to make life as normal as possible for the disabled. A switch to different varieties of transport should not be allowed to be a step backwards to older and less appropriate vehicles for the disabled. Present design improvements should be pursued, such as, from the point of view of visually handicapped people, the use of clear contrasting colours to help passengers find their way around bus layouts and good lighting and bells that can be found without unnecessary difficulty. There should be a duty on operators to consider the needs of the disabled in bus design and route provision.

The provision for shared taxis in the Bill is good news for the disabled. It is another area in which concessionary fares will apply. Staff attitudes can be trained. Hon. Members should imagine the plight of a blind person waiting at a bus stop in an unfamiliar area. A bus sails past because it is a request stop and the blind person does not know. Things might be different if the driver is trained to stop at the sight of a waiting passenger with a white stick and if a notice with tactile symbols is posted on the stop.

Local authorities are responsible for bus stops and the commission that accrues from advertising. They should use special grants that are available to assist the disabled through aids such as the talking bus stops in Western-super-Mare which tell the time and the estimated arrival time of the next bus and announce its approach.

The hon. Member for Crewe and Nantwich said that no experienced operators support these proposals. She shows a complete lack of knowledge of the industry or no care for public transport by making such a statement. The hon. Lady prefers to talk to the hon. Member for Wigan (Mr. Stott) than to hear the facts, but I shall nevertheless quote no less an authority than Mr. Stuart Appleby, the president of the Bus and Coach Council. He says: People have been dictated to far too long. The quality of service has been dictated by the operator. In response to comments by the Transport and General Workers Union, he said: I understand their concern for rural transport but I do not think that they need worry. The services they were talking about will continue operating. If the Opposition prefer the objective view of bus users, I shall quote the Welsh Consumer Council: The present public transport system cannot continue as it is very much longer … A new way forward is needed. The Government's proposals provide a framework within which we believe a new and better transport system can be built". We should reverse the system that has produced declining services and increasing blanket subsidies. The machinery of state regulations of more than half a century ago is more than creaking. The time has come to ensure a proper service at a reasonable cost. That means competition with the safety valve for truly uneconomic but socially necessary routes. I welcome the Bill and ask all right hon. and hon. Members who truely care about the provision of public transport to support its Second Reading.

8.55 pm
Mr. Sydney Bidwell (Ealing, Southall)

I am a senior member of the Select Committee on Transport and recently went to Worcester and Hereford. The House has heard about Worcester and Hereford but nobody has yet mentioned the woman leader of the Tory minority on Hereford city council, which opposes the Bill because of the way that city has suffered. I understand that the council's planning officer has conveyed that view to hon. Members in preparation for today's debate. Hereford has had a ghastly experience, but that is not to say that lessons have not been learned or that the strengthening of the licensing system would not prevent some of the excesses that have been experienced in the Worcester and Hereford trial.

The hon. Member for York (Mr. Gregory) said that he had heard no constructive suggestions from the Opposition. He will get positive comments from the Select Committee report. We shall try to produce an objective report—that is why we have tabled the amendment. Every right-minded hon. Member, including Conservative Members, should consider the cruel logic of the amendment. It would enable the House to have the benefit of the enormous information collected by the Select Committee. The study has been exhaustive.

The hon. Member for Wellingborough (Mr. Fry) made an outstanding speech. The House should learn from what he said as nobody doubts his great experience in these matters, especially in regard to buses because of his association with the National Bus Company. He mentioned how the small operator can easily be put out of business. The man who runs the highly acclaimed Primrose service in Hereford and Worcester says it is not sufficiently profitable and that he is thinking of pulling out. He told me that wear and tear of vehicles is far greater in the stage carriage business than on long runs. If it were possible the operator would prefer to confine his business to holiday runs to the south of France. All sorts of skullduggery has arisen from that competition. The Midland Red is running services that it did not provide previously to drive the innovative service off the road. There has been a scramble for the bus stop in the heart of town, and because the buses cannot get on the roadway, they have been using the pathway.

Hereford city centre is extremely attractive, and I was glad to be there. We talked to members of the city council. The woman leader of the Labour minority asked pertinently why the White Paper did not apply to London. As a Londoner I could tell her that all hell would be let loose under the Bill's crude proposals. I cannot imagine what members of my union, the Transport and General Workers Union who are London busmen, would do if there was complete privatisation of buses of all sorts, sizes and qualities.

Members of the Select Committee talked to the traffic commissioner there. Although he did not disagree with the Bill as a whole, he said that he was afraid that as takings decrease as a result of competition with bigger operators —there will be bigger operators if the NBC is privatised — and profits decrease, safety will suffer first. Regulations about the interior of buses, such as those forbidding loose carpets and loose panelling will be affected. The test on public service vehicles that carry passengers is more severe than that on commercial vehicles. Some commercial operators may think that they can switch to buses on the cheap, but they cannot as they will discover in time. The traffic commissioner admitted that the rigidity of the safety standards, which we all want to see, would go.

In Committee the excessive nature of the Bill will become clear. Most of it is false arid doctrine, not wet doctrine, which appears from time to time from hon. Members on the Benches below the Gangway. Those hon. Members will take over the Tory party before it faces the next general election.

The proposals in the Bill are mad. I hope that the Bill is trimmed down. We could ensure that, if the House had the benefit tonight of the Select Committee's massive evidence. No one with practical experience of transport seems to like the Bill. There is a conflicting attitude about the effects that it will have on rural services. Privateers will not run services in rural areas merely for the love of it, merely to break even, nor if it provides a small profit, but only if it provides a big profit. Those are the only conditions acceptable to them. When they discover other forms of road vehicle operation they will suddenly pull out altogether and leave people stranded.

The hon. Member for Derbyshire, West (Mr. Parris) talked lovingly of having met a woman who said that the experimental area had been a great success, and that buses were more frequent than previously. But in the end bigger operators will drive out smaller operators. They could even run buses free of charge for a period. Predatory pricing would go on under privatisation and the struggle of the public service operator. That is going on at present, and will continue into the future unless there is a one-owner-driver vehicle.

There will be problems such as moonlighting. Drivers will not receive adequate medical attention. At present taxi drivers in London and elsewhere must undergo a stringent medical test. There will not be the present level of supervision, or the same wages standards and conditions, including pension arrangements. That is not true competition.

The taxi trade does not like the Bill. Taxi drivers are flexible. Taxi drivers outside London and many in London, although they have mixed feelings, think that it is possible to have taxi sharing, but do not believe that it can be done under the present system of hailing a taxi at the roadside. They believe that filling a taxi must be done by prior arrangement, which can be done at present. They do not mind an increase in those arrangements. One of my hon. Friends mentioned the position of women out at night, many of whom wish to take taxis because they feel safer doing so. I do not know why the Bill includes a taxi provision. For a long time taxi drivers have wanted special regulations that would properly assess their costs. It is the only transport service that is not relieved of VAT, which is one reason why taxi fares tend to be high.

I cannot discuss every facet of the Bill tonight, and I am aware of the promise to be reasonably short. However, I should say that the MVA Consultancy document on Plymouth estimates that under the Bill's crude arrangements, the rates in that area—which is a Tory one—would have to increase by about 22 per cent.

The Association of District Councils has got it right, and it represents authorities of all political colours. I hope that the Standing Committee will have available to it the considerable evidence heard by the Select Committee. The House should have had that evidence before this debate. I hope that many hon. Members will accept the logic of the work of Select Committee. Why do we have them? If they are not to obtain agreement among the parties on matters of common sense, they mean nothing. The Leader of the House said that he was proud of the work of the Select Committees. The work of the Select Committee on Transport will have been snubbed unless the House carries the amendment of the hon. Member for Wellingborough (Mr. Fry). If it does, the Bill will have to stand still until we receive the Select Committee's report in about a week or two.

9.6 pm

Mr. Michael Knowles (Nottingham, East)

I know that my hon. Friend the Member for Nottingham, South (Mr. Brandon-Bravo) would have wished to be here this evening if he were not abroad on parliamentary business, because we have discussed the effects of the Bill on Nottingham on various occasions. What has come through from the debate is that we have not heard one solid counter proposal from the Opposition. There are always a hundred reasons for doing nothing. What has come through is their love for the nanny state and of bureaucratic control for its own sake. The present system is a typical example of the 1930 ideology of rationalisation. It did not work well before the war, and it led to a 30-year decline in the bus industry. Everyone knows that it has continued for 30 years, but when my right hon. Friend the Secretary of State proposes to do something about it, the immediate reaction is that his proposals are wrong and radical. But something must be done if the industry is not to die.

We heard precisely the same arguments a few years ago about the inter-city bus routes, and we need only consider the benefits that competition has brought there to see what can be within our grasp.

The inflexibility of the present controlled system means that when problems arise, we look only for further controls. As politicians and bureaucrats control the system, they have a vested interest in further controls. Nottingham's history is an example of that. Apart from introducing the bus lanes which beset every large city as a means of squeezing cars off the roads and forcing people into buses, before 1976 the Labour-controlled Nottingham authority introduced a mad scheme called the "zone and collar scheme". The idea was that if the authority could reduce the access points into the city and control them with traffic lights, which were always at red, it would force everyone to get out of their cars and use the buses. Of course, it did not work and was rejected by the local electorate, but it cost £800,000. But it is not untypical of other lunatic schemes introduced from time to time by transport authorities.

The council also planned to increase the bus fleet from 360 to 600 buses. Those buses were not needed, but the council was slavishly devoted to the idea of publicly owned transport. Fortunately, the Labour party lost control there in 1976, so its plan was held up. The bus fleet was reduced to 360 buses, which could more than cope with the demand.

Despite that experience, Nottingham bus services are now mostly sensibly run. Therefore, taken in isolation, one could probably make the case that it did not need the Bill. It is a pity that Nottingham did not volunteer to be a trial area, because it would have been a better trial area than some of the others. It has a catchment area of about half a million people. Nottingham has the largest municipal bus undertaking with 360 buses, the largest private bus operator with 264 buses, one of the larger units of the National Bus Company in Trent and a medium sized private operator in south Nottinghamshire, which would have been a better system for a trial. When it comes to open competition, those four major operators would be able to cope with any small additional operators. Of course, others would come in round the fringes, but those operators should maintain a successful network, almost certainly at lower fares than we have now.

I suspect that the biggest effect could be on taxis. Although people say that this will grow slowly, I suspect that there will be a very quick development of the taxi system. It will have a dramatic effect. We have to accept that this system of control has failed. Siren voices always proclaim that the end of controls, rationing and bureaucracy is dangerous and precipitate. They are right. Freedom is dangerous to a bureaucratic state. That is why I shall support the Government.

9.10 pm
Mr. Roger Stott (Wigan)

My right hon. Friend the Member for Mansfield (Mr. Concannon) indicated in his speech that he would volunteer for the Standing Committee. I have to tell my right hon. Friend that we have an embarrassment of riches. My hon. Friends are queueing up to be members of the Standing Committee. It shows the importance we attach to this measure.

I should like to congratulate the hon. Member for Wellingborough (Mr. Fry) upon his excellent speech. He gave the reasons that underlie his amendment. We should not be debating the Bill until the Select Committee has reported. His speech was delivered in a true House of Commons manner. It compared well with the lamentable performance of his hon. Friend the Member for Derbyshire, West (Mr. Parris) who used the most fatuous example of grocer's shop economics that I have ever heard.

During the debate on the Local Government Bill on 4 December 1984 the right hon. Member for Old Bexley and Sidcup (Mr. Heath) described the contribution of the Secretary of State for Transport as a pathetic image of a speech." — [Official Report, 4 December 1984; Vol. 69, c. 190.] The speech made this afternoon by the Secretary of State for Transport was, if anything, even worse than that. He was totally unconvincing and unpersuasive. When the Bill reaches the Standing Committee we shall make sure that he is made very well aware of our view.

I am not complacent, nor is my hon. Friend the Member for Crewe and Nantwich (Mrs. Dunwoody). Public transport is suffering. There has been a decline in public transport. There has been a decline in the provision of public transport in our rural areas. That decline began in 1979 when this Government came to power. Since 1979 there has been an acceleration in the decline of our transport system. An increasing number of people find themselves condemned to virtual isolation. That has been said by many hon. Members during this debate. In particular, women, children, the elderly, the low-paid and the unemployed who depend upon public transport to get to their jobs or to see their families and friends are being denied that essential service.

Where it is provided properly, that service is, in my view, one of the most emancipating elements in the lives of ordinary people. However, those services have declined as a consequence of the transport policies of this Government since 1979. Local authorities, in particular Labour-controlled authorities, have been subjected to ever tighter squeezes on expenditure and public transport has suffered as a direct consequence. The transport supplementary grant has been reduced not only this year but by 23 per cent. since this Government came to office. Across the country we see what has happened to public transport. The National Bus Company ran 80 million fewer miles in 1983 than it did in 1979 when this Government came to office. There has been a positive decline in public transport since this Government came to power. When democratically elected Labour councils have tried to support public transport, the Government have tried to stop them by introducing cuts in grant and attempting to impose spending limits. This has recently been reinforced by the rate-capping legislation.

Not content with this catalogue of disaster, the Secretary of State is now introducing his Bill to deregulate and privatise Britain's bus industry. He bases this legislation on his own theoretical experience and on a small and inconclusive experiment in Hereford and Worcester. We have heard about the Hereford and Worcester experiment from all sides of the House, and I have taken careful note of what people have told me about their experience of that scheme. As time is short, I cannot pay full attention to all the matters that have been raised in the debate, but I advise the hon. Member for Hereford (Mr. Shepherd) to read the speech of Lord Teviot, a former busman, who, in the other place, described his experiences when he visited Hereford and Worcester. He concluded: The city council regard the trial area as a disaster".—[Official Report, House of Lords, 25 October 1984; Vol. 456, c. 307.]

Mr. Colin Shepherd


Mr. Stott

I cannot give way because I have a lot to say.

The Hereford and Worcester trial has been a total disaster. It is the wrong premise upon which to deregulate stage carriage bus services, to break up the PTEs, to break down the municipal operators into smaller units, to prepare local authority bus services for private ownership and to prevent direct subsidy for network services.

The White Paper which preceded the Bill shows that the proposals are based on the assumption that deregulation will bring new operators to the industry, lower costs, reduce fares and provide scope for new services. A thorough examination of the Government's proposals, and the evidence claimed to support them, shows that they are based on a crude economic theory of free market forces. That distorts the cost comparisons between private and public sector operations, and between the PTEs and the National Bus Company. There is no logical reason on the evidence available to support the Government's assertion that subsidy leaks into higher operational costs or that the industry does not benefit from economies of scale.

The evidence quoted and experiences in the trial area and from abroad, are highly selective, incorrect and will not stand the test of scrutiny. Clauses 81 and 84 oblige local authorities that wish to subsidise bus services to go into open competitive tendering. Those proposals are impracticable in a totally unregulated framework of operation. If the conditions of the contracted services are not protected from competition there is no way in which the operator who enters into a contract can know how long that contract will remain viable.

Mrs. Elaine Kellett-Bowman


Mr. Stott

No, I shall not give way. We have heard that argument from the hon. Member for Wellingborough and if Conservative Members are not prepared to believe me, they should at least give him the benefit of the doubt.

These proposals are really about reducing revenue support to meet public expenditure targets. A combination of the elimination of cross-subsidy, the cutting of revenue support and the other measures that have been put before us tonight will not work. They will not provide the services that the Secretary of State requires, but will do extremly severe damage to our bus industry. If hon. Members on the Government Benches refuse to believe what I say, perhaps I could refer them to the evidence taken by the Select Committee. The hon. Member for Lancaster (Mrs. Kellett-Bowman) should not shake her head. I am referring to the evidence given by the National Bus Company. My hon. Friend the Member for Sunderland, South (Mr. Bagier) was questioning two gentleman from the National Bus Company, and I would not impugn their integrity, even if the hon. Member for Hereford does. My hon. Friend asked them about the reduction in revenue support. Mr. Beetham answered: It would almost certainly lead to a very severe reduction in the level of revenue-supported services, which may be provided by operators. My hon. Friend then asked: You mean increased fares or less services? He replied: Both. How far a county could, from its own resources, make up that reduction in central government funding is another aspect of the situation, but there the county might face difficulties in other aspects, like rate capping which would affect that. I think there would be grave difficulties. Mr. Brook, the chairman of the National Bus Company, just appointed by the Secretary of State, came into the argument at that point: I would be loath to see increased fares as a solution to this problem, because the fares are at levels already which are hardly bearable. It would require very substantial increases in fares and we would encounter great passenger resistance. My option would be to go for reduced services. That is what the chairman of the National Bus Company said about the provisions of the Bill; those are not my words but his.

So far no one has referred to section 20 of the Transport Act 1968, which gives the passenger transport executives the right to pay to keep local railway lines open. This is a very important issue, particularly in Greater Manchester and in Strathclyde. No one has referred in the debate to the problems that are likely to occur if the Bill goes through as drafted. The activities of registered operators will clearly have implications for local rail services, where there is irect competition between the two. Registered operators may well draw a proportion of passengers from the local rail network with the effect of undermining further the financial viability of individual lines. Faced with these difficulties and a declining availability of revenue support, the authority is likely to be forced to withdraw support, with closure of the lines as the most likely outcome. This could effectively prejudice major investment proposals designed to improve the public transport infrastructure. There is no doubt that the proposals in Greater Manchester for a system of light rapid transit could be a casualty of this process.

Putting aside the practical operational implications of deregulation, there will be major problems with the forecasting of demand for revenue and concessionary support. In advance of deregulation the authority will simply not know what its revenue support requirements will amount to. Even when this is known, the activities of registered operators are likely to produce an unstable pattern of service for a number of years. I have already mentioned this. Concessionary support raises substantial difficulties of its own, not least the bureaucracy that is likely to be involved in preserving a system of permits and passes for those entitled to benefit. Again, forecasting of the demand for support is awkward in the absence of firm knowledge of who will participate in any scheme.

This is a highly complex area but it is important to put it on the record now. The proposed arrangements for concessionary travel within the general rate support grant structure require attention. At the moment children's travel is deemed to be financed from general rate support. There will have to be adjustments between the grant-related expenditure assessment for revenue support and the GREA for concessionary support.

For 1984–85, the Greater Manchester passenger transport executive estimated that its revenue support is £49.2 million. Of this total, at least £15 million, on the basis of revenue forgone by the executive, is attributable to children. Bearing in mind that much of this travel takes place during the peak times when costs are at their highest, the estimate is probably an understatement of the true cost. To put this issue in context, the current GREA for elderly concessionary travel in Greater Manchester is about £10 million, but the cost of providing that travel is £22 million. I suspect that other PTEs have similar figures.

If we are getting locked into highly complicated calculations about rent support grants, GREAs and concessionary fare travel, I suggest to the Secretary of State that this is such a crucial issue that we shall have to spend a great deal of time in Committee getting assurances that concessionary fares will not be undermined. The Labour party feels that if these provisions are passed as they are, there will be severe damage to the concessionary fares in the PTE areas.

In totality, the proposals remove from passenger transport the long-held status of a strategic industry with integrated networks such as Tyne and Wear. It is being relegated to a "use it or lose it" industry. If the current Government thinking is correct, the rest of the world is wrong. No other Government of any developed country are prepared to place the business of moving millions of people daily at the mercy and the inconsistency of the free market forces. The Secretary of State knows that and that is why he has excluded London from the Bill, and will not extend its provisions to London.

To placate some of his Back Benchers who have grave doubts about the Bill, the Secretary of State has said that the contents of the Bill when it has been passed will not be operational until December 1986, or perhaps early 1987. However, whether the Bill's provisions become operational sooner or later, these issues will become an election issue next year in the county council elections, and in the general election. People will have a clear choice. They can believe in a Secretary of State for Transport who continues to inhabit the higher astral planes of lunacy, and who will be solely responsible for the destruction of our bus services if these measures go through, or, on the other hand, they can take our alternative. The Labour party will be campaigning in those elections, putting our alternative strategy and our alternative transport policy. We shall tell the people that we shall restore local democratic control over their own affairs and that we shall preserve their bus services.

My hon. Friends the Members for Crewe and Nantwich and for West Bromwich, East (Mr. Snape) and I have been addressing meetings up and down the country since the Secretary of State first produced his White Paper on the buses. I tell him and the House that these proposals do not have a friend anywhere—

Mrs. Kellett-Bowman


Mr. Stott

—apart from one or two sycophants on the Government Benches. The pity is that the municipal operators, the National Bus Company, the well-established private operators, the Taxi Drivers Association, the Bus and Coach Council, the National Federation of Women's Institutes, Transport 2000, Rural Voice, the Association of Metropolitan Authorities, the Association of District Councils and the general public —the customer, the people who matter—have shown their objections to the Secretary of State's proposals.

The Secretary of State has displayed his usual characteristic of imitating the dodo. If one were to walk through the deepest recesses of his mind, one would not even get one's feet wet. The right hon. Gentleman has contemptously dismissed the voices of experience and reason. Before we are through with him, he will wish that he had never been born.

I know of no political commentator who has described the tenure of office so far of the Secretary of State as a howling success. The policies that the right hon. Gentleman has tried to pursue of late have hardly enhanced his reputation. In fact, they have merely confirmed what most of us believe—that the Secretary of State not only walks but thinks in concrete. As a consequence, he has shown a monumental display of incompetence in dealing with almost every aspect of policy he has so far put before the House.

The Secretary of State for Transport is a paradox. He possesses characteristics that are not necessarily exclusive to him, of being, on the one hand, intellectually stupid and, on the other hand, artistically brilliant. I suggest that the right hon. Gentleman should do us all the favour of doing what he does best and leaving transport to other people. If he does not, I guarantee that he will receive not only in the House, but in the other place, the biggest mauling of his political career. I invite hon. Members to join me this evening in starting that process.

9.31 pm
The Parliamentary Under-Secretary of State for Transport (Mr. David Mitchell)

My hon. Friend the Member for Wellingborough (Mr. Fry) has asked for a delay of the Standing Committee sitting until the Select Committee reports. The Select Committee has also asked for time to publish its evidence. I gather that the Select Committee can do that by 21 February. The Government are prepared to delay setting up the Committee until Thursday 21 February. I hope that that concession will satisfy my hon. Friend.

On 28 November 1984 the Chairman of the Select Committee wrote to my right hon. Friend the Secretary of State and said that the Committee hoped to publish its report in early February.

Mr. Leadbitter

The hon. Gentleman is not providing a concession. The timetable which he has announced does not give hon. Members any time to study the Committee's report.

Mr. Mitchell

It certainly is a concession, because the Committee was due to sit on 19 February. There is, therefore, a delay. I think that it is likely that the Committee will be able to publish by then.

The Select Committee's Chairman expected to publish his report in early February. It is now near the middle of February, and I am sure that the Select Committee will agree that the Government are in no way responsible for any delay that has occurred.

Mr. Oakes

The hon. Gentleman says that the evidence will be produced on 19 February. That is the day on which the Select Committee meets. Will the report be available to us on that day?

Mr. Mitchell

That is up to the Select Committee. It would not be right for me to speak for it.

Mr. Parris

As a member of the Select Committee —the hon. Member for Hartlepool (Mr. Leadbitter) and the right hon. Member for Halton (Mr. Oakes) are not —may I say that my hon. Friend's concession will be greatly appreciated by all members of the Select Committee on Transport. We are extremely grateful to him.

Mr. Mitchell

I am grateful to my hon. Friend for making that point.

The question of a Special Standing Committee is a matter for my right hon. Friend the Leader of the House. I understand that the procedure is generally applied to non-controversial Bills. I doubt that the House would consider that that applied in this case. I hope that, in the light of this concession, my hon. Friend the Member for Wellingborough will feel able not to press his motion. I certainly would not be able to advise my hon. Friends to support him were he to do so.

Throughout this debate there has been very clear recognition of the enormous importance of buses to a large number of our fellow citizens. The elderly particularly, students, the lower-paid going to and from work, women, especially those isolated by their husbands' taking the car —all of these are enormously dependent on the bus for getting around, and 39 per cent. of households have no regular access to a car. Therefore, the quality of life for many of our fellow citizens very much depends upon the success of this industry, but it is in a state of decline.

The hon. Member for Wigan (Mr. Stott) suggested that that decline started in 1979.

Mr. Stott


Mr. Mitchell

I can tell him that it has been going on for 30 years. Thirty years ago 40 per cent. of all journeys were done by bus. It is now down to 8 per cent. and passenger mileage has come down by 50 per cent. in that period. Indeed, in the last 10 years, while fares have gone up 30 per cent. above the rate of inflation, there has been a 28 per cent. reduction in passenger journeys. So what we have here — and the House should realise this — is another sunset industry in the making if nothing is done to revitalise it.

My hon. Friend the Member for Hereford (Mr. Shepherd) was absolutely right when he said that no responsible Government could sit and do nothing while the situation continued to deteriorate. Subsidy has been tried as a solution. In 10 years it has gone from £10 million a year to no less than £522 million in revenue support. That has nothing to do with concessionary fares or other aspects. Nobody could claim that this huge increase has resulted in any significant improvement in the services provided to the public.

Mr. Richard Caborn (Sheffield, Central)

Can the hon. Gentleman rightly say that about south Yorkshire? For the last decade in every year there has been an increase in the number of passengers carried, and by every objective test the operation has been shown to be the most cost-effective. Indeed, in 1982, when the Secretary of State's Department put into operation a survey, again it showed the most balanced approach to transport. We are now seeing over 350 million journeys each year for a population of 1.3 million in south Yorkshire. The operation has been shown by every objective test to be the most cost-effective.

Mr. Mitchell

The hon. Gentleman has his own views and quite clearly south Yorkshire is in many ways a law unto itself. He may think it is that good, but in south Yorkshire the costs per bus mile are among the highest of all PTEs in the country—over £2.07. They are 11 per cent. above those in the west midlands. The south Yorkshire PTE is alone in having more than 30 per cent. of its buses without one-man operation. In other words, it is not as efficient an operation as the hon. Gentleman is telling the House.

I could hardly recognise the Bill from some of the things which the hon. Member for Crewe and Nantwich (Mrs. Dunwoody) said about it. She suggested that 50,000 jobs would have to go. What she means is that 50,000 jobs will be transferred from the public to the private sector. So it is a half-truth, and a damaging one, which she is trying to peddle when she suggests that 50,000 jobs will go. She told the House that as a result of the White Paper the women's institutes were so fearful that a survey was conducted in Oxfordshire. I have to tell her that the survey in Oxfordshire predated the White Paper by a considerable time.

She says that in Hereford and Worcester the rural services were cut back as a result of the Government's trial area there. My hon. Friend the Member for Hereford (Mr. Shepherd), giving evidence to the House this evening, has already demonstrated that not only were they not cut, but they were extended by 2 per cent. That is a valuable improvement in the situation.

The Bill is not a charter for unscrupulous politicians to frighten old-age pensioners. I think, particularly, of the worries raised by my hon. Friend the Member for Lancaster (Mrs. Kellett-Bowman). Only last week I was in Birmingham, and heard of thousands of old-age pensioners who had been frightened into believing that the Bill would do away with concessionary fares. But the Bill is not concerned in any way with concessionary fares other than to ensure that they are available to more citizens through allowing any operator to participate in the scheme.

Mr. Leadbitter

Will the Minister give way?

Mr. Mitchell

My hon. Friend the Member for—

Mr. Leadbitter


Mr. Speaker

Order. The Minister is not giving way.

Mr. Leadbitter

Will the Minister give way?

Mr. Mitchell

I have already given way several times.

My hon. Friend the Member for Wellingborough asked a sophisticated and thoughtful question, as did the right hon. Member for Mansfield (Mr. Concannon). They asked whether it would be possible for concessionary fares to be provided without having to have tokens, through some system of bus passes and so on. I asked my hon. Friend the Member for Wellingborough what sort of numbers caused him concern. He wanted to know how people could manage if there were four or five operators in the scheme. I should point out that in Birmingham there are 32 operators in the scheme, and at present they do not use tokens. I hope that that will be of some reassurance to him.

Several hon. Members, including my hon. Friends the Members for Swindon (Mr. Coombs) and for Wellingborough and the hon. Members for Hartlepool (Mr. Leadbitter) and for Isle of Wight (Mr. Ross) mentioned cross-subsidy. We tend to think about the beneficiaries of cross-subsidy and not to recognise that there are payers as well. Many constituents are being taken to the cleaners by the excess profits that are taken from the better routes. When the Bill is enacted, there will be lower fares and more services on the better used routes.

Thoughtful people will recognise that over-reliance on cross-subsidy has been a major factor in the industry's decline. For every 10 per cent. increase in fares, 3 per cent. of the passengers are lost. The industry is cross-subsidising to the detriment of its major potential customers on its better routes. That means that the blame for much of the industry's decline can be laid at the door of the system.

Mr. Leadbitter


Mr. Colin Shepherd


Mr. Mitchell

I give way to my hon. Friend.

Mr. Shepherd

Can my hon. Friend confirm that the ending of cross-subsidy will not lead to an increase in direct subsidies paid to operators of unprofitable routes at the expense of ratepayers?

Mr. Mitchell

I shall be happy to take the House through what will happen. First, a considerable degree of cross-subsidy will continue. But it will be commercial cross-subsidy and not the present form of cross-subsidy. That will go on because operators want to maintain their goodwill, to protect their brand image, to hold off competitors, to position vehicles and so on. Therefore, cross-subsidy will continue to provide the part of the network that is not viable. But any operator will admit that operators have nearly always got a large block of marginal routes. If nothing happened, those routes would drop off after three, four, five or 10 years, and areas might be left without any services if we allowed things to continue. On those marginal routes, once competition operates and the bus companies start to become more efficient, they will be able to operate those routes without making a loss. My hon. Friend the Member for Hereford knows very well that the Midland Red bus company when faced with competition improved its productivity by no less than 25 per cent. That kind of improvement turns a marginal route into a profitable one.

Then there will be new operators who will come in with minibuses and such like, often not town-based services going out to the country but minibuses starting in country villages and running services into the towns.

Mr. Steen

When my hon. Friend visited South Hams last weekend, did he get the impression at the public meeting that he addressed that the constituents of South Hams were excited by the prospect of minibuses going from the country into the market towns or that they were disenchanted at the prospect of the application of the Bill to their area?

Mr. Mitchell

When I visited South Hams, there was a great deal of complaint about villages like Princetown which have no bus services but now see the prospect of having such services.

Finally, there will be those routes which will not be economic on any basis. For them, the subsidy available to the local authorities will be appropriate, but by means of competitive tender. By using competitive tender, they will find that their money goes much further than it does at present. What now takes place is a bilateral deal between the county council and the largest operator and nobody knows whether there is value for money. When this was put to competitive tender in Hereford, 38 per cent. of the ratepayers' money was saved. When it was attempted in Norfolk, the National Bus Company wanted £500,000 for a block of routes. When it was put out to competitive tender, it cost not £500,000 but £150,000, which was a huge saving for the ratepayer.

There is, of course, the option in the hands of the county council not to save money but to extend the network. Hon. Members who are worrying about the rural areas will realise that county councils will have plenty of opportunity to extend and maintain the network, if that is the wish of the people in the area concerned.

In addition, we are providing for the rural areas a £20 million transitional grant and £1 million a year for innovation.

Mrs. Dunwoody


Mr. Mitchell

The hon. Lady says "Oh", but that £20 million is in addition to the substantial sums included in the grant-related expenditure assessment to councils for expenditure on subsidising the services.

The attack of the hon. Member for Wigan (Mr. Stott) would have some strength in it if there were no room for improved efficiency as a result of competition. But I have already mentioned that Midland Red, faced with competition, saved 25 per cent. by improving productivity. The National Bus Company's operating costs averaged 25 per cent. below theose of the passenger transport executive. The Leeds study of four current National Bus Company agreements demonstrated that the crew operating costs varied from 23 per cent. to 77 per cent. above the level in other areas. These are within current systems operating in the National Bus Company—huge opportunities for improved efficiency.

The private sector costs are even lower than those of the National Bus Company, that is, some 20 per cent. below, as the Guildford and Cranleigh studies show. In travelling round the country and listening to local councillors and transport undertakings, I have noted the enormous variations in costs, in efficiency and in load factors—in Manchester only 13 persons per bus — with great differences in miles driven per year by drivers and in manpower per bus.

Mr. Bidwell

The Midland Red said that it had been stimulated and shaken up by the competition. Its managing director accepted that. It is entering into some arrangements with private operators. That is not competition, but an arrangement. This applies particularly to the company to which I referred in my speech with regard to the run-in periods, sharing routes and so on. That is what it is getting up to, and it is not competition. The Minister is not giving an accurate description of matters. It is the scale of privatisation to which they are opposed.

Mr. Mitchell

In Hereford, Midland Red was able to concentrate a huge number of vehicles on one front in order deliberately to drive the competition into the ground. It even went as far as running free services. That will not happen when we apply deregulation to the country as a whole. No major operator will be able to concentrate on one front as it will be assailed on all fronts. That means that there will be a much more even balance of competition than in the trial area.

My hon. Friend the Member for Wellingborough put the case for competitive franchises. That would be some improvement on the present position, but it has the inherent disadvantage that the pattern of services is decided by county transport planners, not by the market. Under franchising, we would never know how much the market could do on its own. The franchising system would lack flexibility and, worst of all, once a franchise was awarded the competitive pressure would be off. Therefore, although it would be some improvement, it would be nothing like enough to revitalise the industry.

I urge those thinking about the advantages of franchising to consider what would happen in, for example, Manchester if the NBC won the franchise and the PTE lost it. How many bus drivers and other people would be out of work as a result of that? Before advocating franchising I urge them to think carefully about how dangerous that course would be.

Throughout the debate we have heard complaints about safety. We have been told that there is a cowboys' charter. That was mentioned by the right hon. Member for Mansfield and the hon. Member for Hartlepool. The right hon. Member for Halton (Mr. Oakes) said that thousands of people would be maimed. I have never heard such hysterical nonsense. There is no evidence to show that the private sector is any worse than the public sector in the safety of its vehicles. The annual tests show that the NCB has a pass rate of 60 per cent., the private sector a pass rate of 56 per cent.—a little worse, but not much—while the PTEs have a pass rate of only 49 per cent. and London Transport of only 47 per cent. Therefore, no one can say that the private sector is worse than the public sector.

I shall go further and say that recently a random check was made on 5 per cent. of London Transport buses, and 51 per cent. were put off the roads immediately with prohibition orders as unsafe. I hope that no one will suggest that public sector vehicles are safer than private sector vehicles.

Mr. Fry

Does my hon. Friend accept that two distinct sets of statistics published in Hansard were rather contradictory? Does he recall that I tabled a further parliamentary question, the answer to which showed that after some minor adjustments the public sector was able to pass a higher percentage of its vehicles than the private sector—and my hon. Friend answered that question.

Mr. Mitchell

My hon. Friend is correct. The reason is that most of the public sector operators have their tests carried out on their premises while most of the private sector operators have to take their vehicles several miles to the testing stations. Therefore, if a light bulb does not work the fault can be repaired immediately on the premises when the tests are being carried out; and that facility is not generally available to the private operator.

My hon. Friend the Member for Wellingborough asked for an assurance on the number of inspectors. We are recruiting more inspectors and we shall devote sufficient resources to ensure that there are enough to cover the extra number of operators.

When the House debated the deregulation of long-distance coaches we had all the arguments about cowboys, people being maimed, and so on. But since deregulation took place for long-distance coaches their accident involvement is down by 20 per cent.

My hon. Friend asked why we did not have the same financial requirements for a bus operator's licence as for an HGV licence. I can assure him and the House that we do. They are identical.

Eliza Doolittle, in that famous line, said In Hertford, Hereford and Hampshire hurricanes hardly happen. But in Hereford they certainly have, as has been made clear to the House. The county council found a 2 per cent. increase in rural mileage and a 38 per cent. saving in ratepayers' money. There were lower fares, more people travelled by bus and there was an end to the complaints which have been a recurring feature of the debate from many of my hon. Friends. Indeed, I wonder sometimes whether the story which appeared in Marketing on 17 November 1983 was entirely apocryphal: A local authority, told that its bus drivers were speeding past queues of people with a smile and wave of the hand, replied, 'It is impossible for drivers to keep to their timetables if they have to stop for passengers'. One of the features that has become increasingly apparent as the debate has progressed is the change in attitude which is brought about by competition and that is one of the things which has become most clear in the case of Hereford. The town council complained about bus siting difficulties, fumes and congestion; but the passengers loved it. I have talked to many people there. For example, it has been said: They come in one heap—two Midland, one Primrose and another Midland Red; and I prefer Primrose, they are more entertaining, the drivers more friendly; and They are cheaper now. There is a bit of rivalry. It means the service is better; and They run to a schedule now, not just when they like. A young man, visiting from west Yorkshire, said: Where I come from the buses do not run so late and they cost more. I do not use them often but it is cheap and the last bus is after 11 o'clock at night". I could go on with example after example.

What I can say, without any risk of contradiction, is that there is no doubt that the people of Hereford, having tasted competition and the advantages which it has brought, do not want to go back to the old system of monopoly.

The hon. Member for Wigan said, wrongly, that these proposals are built on one trial area. That is not true. They are built on three principles—privatisation, opportunity and competition. I do not expect Labour Members to support privatisation, but Conservative Members believe fundamentally in spreading power, wealth and decision making throughout the community, not concentrating it in the hands of the state. This privatisation will give a lot more people a chance to be shareholders, participators and owners with a stake in Britain's wealth. It represents opportunity because it will provide for the removal of barriers to new bus operators and enable small businesses to be born and to grow, providing a service to the public. Competition is the surest way to improve service to the customer, which is what the Bill is for. I ask the House to give it full support tonight.

Mr. Fry

In view of the concession made by the Government—and as I have made my point on behalf of the Select Committee on Transport and on behalf of all Select Committees—I beg to ask leave to withdraw the amendment.

Hon. Members


Mr. Speaker

In view of that reaction, I must put the Question.

Question put, That the amendment be made:—

The Housed divided: Ayes 210, Noes 290.

Division 99] [10 pm
Abse, Leo Dobson, Frank
Adams, Allen (Paisley N) Dormand, Jack
Alton, David Douglas, Dick
Anderson, Donald Dover, Den
Archer, Rt Hon Peter Dubs, Alfred
Ashdown, Paddy Duffy, A. E. P.
Ashley, Rt Hon Jack Dunwoody, Hon Mrs G.
Ashton, Joe Eadie, Alex
Atkinson, N. (Tottenham) Eastham, Ken
Bagier, Gordon A. T. Edwards, Bob (W'h'mpt'n SE)
Banks, Tony (Newham NW) Ellis, Raymond
Barnett, Guy Evans, John (St. Helens N)
Barron, Kevin Ewing, Harry
Beckett, Mrs Margaret Fatchett, Derek
Beith, A. J. Fields, T. (L'pool Broad Gn)
Bennett, A. (Dent'n & Red'sh) Fisher, Mark
Bevan, David Gilroy Flannery, Martin
Bidwell, Sydney Foot, Rt Hon Michael
Blair, Anthony Forrester, John
Boothroyd, Miss Betty Foster, Derek
Boyes, Roland Foulkes, George
Bray, Dr Jeremy Fraser, J. (Norwood)
Brown, Gordon (D'f'mline E) Freeson, Rt Hon Reginald
Brown, Hugh D. (Provan) Freud, Clement
Brown, N. (N'c'tle-u-Tyne E) Fry, Peter
Brown, Ron (E'burgh, Leith) Garrett, W. E.
Bruce, Malcolm George, Bruce
Buchan, Norman Gilbert, Rt Hon Dr John
Caborn, Richard Godman, Dr Norman
Callaghan, Jim (Heyw'd & M) Golding, John
Campbell, Ian Gould, Bryan
Campbell-Savours, Dale Gourlay, Harry
Carlile, Alexander (Montg'y) Hamilton, James (M'well N)
Carter-Jones, Lewis Hamilton, W. W. (Central Fife)
Clark, Dr David (S Shields) Hancock, Mr. Michael
Clarke, Thomas Hardy, Peter
Clay, Robert Harman, Ms Harriet
Clwyd, Mrs Ann Harrison, Rt Hon Walter
Cocks, Rt Hon M. (Bristol S.) Hart, Rt Hon Dame Judith
Cohen, Harry Hattersley, Rt Hon Roy
Coleman, Donald Heffer, Eric S.
Concannon, Rt Hon J. D. Hogg, N. (C'nauld & Kilsyth)
Conlan, Bernard Holland, Stuart (Vauxhall)
Cook, Frank (Stockton North) Home Robertson, John
Cook, Robin F. (Livingston) Howell, Rt Hon D. (S'heath)
Cowans, Harry Howells, Geraint
Cox, Thomas (Tooting) Hoyle, Douglas
Craigen, J. M. Hughes, Dr. Mark (Durham)
Crowther, Stan Hughes, Robert (Aberdeen N)
Cunliffe, Lawrence Hughes, Roy (Newport East)
Cunningham, Dr John Hughes, Sean (Knowsley S)
Dalyell, Tam Hughes, Simon (Southwark)
Davies, Rt Hon Denzil (L'lli) John, Brynmor
Davies, Ronald (Caerphilly) Johnston, Russell
Davis, Terry (B'ham, H'ge H'l) Jones, Barry (Alyn & Deeside)
Deakins, Eric Kaufman, Rt Hon Gerald
Dewar, Donald Kennedy, Charles
Dixon, Donald Kirkwood, Archy
Lambie, David Rees, Rt Hon M. (Leeds S)
Lamond, James Richardson, Ms Jo
Leadbitter, Ted Roberts, Allan (Bootle)
Leighton, Ronald Roberts, Ernest (Hackney N)
Lewis, Ron (Carlisle) Robertson, George
Lewis, Terence (Worsley) Robinson, G. (Coventry NW)
Litherland, Robert Rogers, Allan
Lloyd, Tony (Stretford) Ross, Stephen (Isle of Wight)
Lofthouse, Geoffrey Rowlands, Ted
Loyden, Edward Sedgemore, Brian
McCartney, Hugh Sheerman, Barry
McDonald, Dr Oonagh Sheldon, Rt Hon R.
McGuire, Michael Shore, Rt Hon Peter
McKay, Allen (Penistone) Short, Ms Clare (Ladywood)
McKelvey, William Short, Mrs R. (W'hampt'n NE)
Mackenzie, Rt Hon Gregor Skinner, Dennis
Maclennan, Robert Smith, C. (Isl'ton S & F'bury)
McNamara, Kevin Smith, Cyril (Rochdale)
McTaggart, Robert Smith, Rt Hon J. (M'kl'ds E)
McWilliam, John Snape, Peter
Madden, Max Soley, Clive
Marek, Dr John Spearing, Nigel
Marshall, David (Shettleston) Steel, Rt Hon David
Mason, Rt Hon Roy Stewart, Rt Hon D. (W Isles)
Maynard, Miss Joan Stott, Roger
Meacher, Michael Strang, Gavin
Meadowcroft, Michael Straw, Jack
Michie, William Thomas, Dafydd (Merioneth)
Mikardo, Ian Thomas, Dr R. (Carmarthen)
Millan, Rt Hon Bruce Thompson, J. (Wansbeck)
Miller, Dr M. S. (E Kilbride) Thorne, Stan (Preston)
Mitchell, Austin (G't Grimsby) Tinn, James
Morris, Rt Hon J. (Aberavon) Torney, Tom
Nellist, David Wainwright, R.
Oakes, Rt Hon Gordon Wardell, Gareth (Gower)
O'Brien, William Wareing, Robert
O'Neill, Martin Weetch, Ken
Orme, Rt Hon Stanley Welsh, Michael
Owen, Rt Hon Dr David White, James
Park, George Wigley, Dafydd
Parry, Robert Williams, Rt Hon A.
Patchett, Terry Winnick, David
Pavitt, Laurie Woodall, Alec
Pendry, Tom Wrigglesworth, Ian
Penhaligon, David Young, David (Bolton SE)
Pike, Peter
Prescott, John Tellers for the Ayes:
Randall, Stuart Mr. Frank Haynes and
Redmond, M. Mr. John Maxton.
Adley, Robert Braine, Rt Hon Sir Bernard
Alexander, Richard Bright, Graham
Alison, Rt Hon Michael Brinton, Tim
Amess, David Brittan, Rt Hon Leon
Ancram, Michael Brooke, Hon Peter
Arnold, Tom Brown, M. (Brigg & Cl'thpes)
Ashby, David Browne, John
Aspinwall, Jack Bryan, Sir Paul
Atkins, Rt Hon Sir H. Buchanan-Smith, Rt Hon A.
Atkins, Robert (South Ribble) Buck, Sir Antony
Atkinson, David (B'm'th E) Budgen, Nick
Baker, Rt Hon K. (Mole Vall'y) Bulmer, Esmond
Baker, Nicholas (N Dorset) Burt, Alistair
Baldry, Tony Butcher, John
Banks, Robert (Harrogate) Butler, Hon Adam
Beaumont-Dark, Anthony Butterfill, John
Beggs, Roy Carlisle, John (N Luton)
Bellingham, Henry Carlisle, Kenneth (Lincoln)
Bendall, Vivian Carttiss, Michael
Benyon, William Cash, William
Best, Keith Chalker, Mrs Lynda
Biffen, Rt Hon John Chapman, Sydney
Biggs-Davison, Sir John Chope, Christopher
Blackburn, John Churchill, W. S.
Bonsor, Sir Nicholas Clark, Dr Michael (Rochford)
Boscawen, Hon Robert Clark, Sir W. (Croydon S)
Bowden, A. (Brighton K'to'n) Clarke, Rt Hon K. (Rushcliffe)
Bowden, Gerald (Dulwich) Clegg, Sir Walter
Boyson, Dr Rhodes Cockeram, Eric
Colvin, Michael Hunter, Andrew
Conway, Derek Irving, Charles
Coombs, Simon Jackson, Robert
Cope, John Jenkin, Rt Hon Patrick
Cormack, Patrick Jessel, Toby
Cranborne, Viscount Johnson Smith, Sir Geoffrey
Crouch, David Jones, Gwilym (Cardiff N)
Currie, Mrs Edwina Jones, Robert (W Herts)
Dickens, Geoffrey Joseph, Rt Hon Sir Keith
Dicks, Terry Kellett-Bowman, Mrs Elaine
Dorrell, Stephen Key, Robert
Douglas-Hamilton, Lord J. King, Rt Hon Tom
du Cann, Rt Hon Sir Edward Knight, Gregory (Derby N)
Dunn, Robert Knight, Mrs Jill (Edgbaston)
Durant, Tony Knowles, Michael
Dykes, Hugh Knox, David
Edwards, Rt Hon N. (P'broke) Lamont, Norman
Eggar, Tim Lang, Ian
Emery, Sir Peter Latham, Michael
Evennett, David Lawler, Geoffrey
Eyre, Sir Reginald Lawrence, Ivan
Fairbairn, Nicholas Lawson, Rt Hon Nigel
Farr, Sir John Leigh, Edward (Gainsbor'gh)
Favell, Anthony Lennox-Boyd, Hon Mark
Fenner, Mrs Peggy Lilley, Peter
Finsberg, Sir Geoffrey Lloyd, Ian (Havant)
Forman, Nigel Lloyd, Peter, (Fareham)
Forsyth, Michael (Stirling) Luce, Richard
Forth, Eric McCrindle, Robert
Fowler, Rt Hon Norman McCurley, Mrs Anna
Fox, Marcus MacGregor, John
Franks, Cecil MacKay, John (Argyll & Bute)
Fraser, Peter (Angus East) Maclean, David John
Freeman, Roger Maginnis, Ken
Galley, Roy Major, John
Glyn, Dr Alan Malone, Gerald
Goodlad, Alastair Marland, Paul
Gorst, John Mather, Carol
Gow, Ian Maxwell-Hyslop, Robin
Gower, Sir Raymond Mayhew, Sir Patrick
Grant, Sir Anthony Mellor, David
Greenway, Harry Merchant, Piers
Gregory, Conal Miller, Hal (B'grove)
Griffiths, Peter (Portsm'th N) Mitchell, David (NW Hants)
Grist, Ian Molyneaux, Rt Hon James
Ground, Patrick Monro, Sir Hector
Gummer, John Selwyn Morris, M. (N'hampton, S)
Hamilton, Hon A. (Epsom) Morrison, Hon C. (Devizes)
Hamilton, Neil (Tatton) Morrison, Hon P. (Chester)
Hampson, Dr Keith Moynihan, Hon C.
Hannam, John Neale, Gerrard
Hargreaves, Kenneth Needham, Richard
Harris, David Nelson, Anthony
Harvey, Robert Newton, Tony
Haselhurst, Alan Nicholls, Patrick
Havers, Rt Hon Sir Michael Norris, Steven
Hawkins, C. (High Peak) Onslow, Cranley
Hawkins, Sir Paul (SW N'folk) Ottaway, Richard
Hawksley, Warren Page, Sir John (Harrow W)
Hayes, J. Parris, Matthew
Hayhoe, Barney Patten, John (Oxford)
Hayward, Robert Pattie, Geoffrey
Heddle, John Peacock, Mrs Elizabeth
Henderson, Barry Pollock, Alexander
Heseltine, Rt Hon Michael Porter, Barry
Hickmet, Richard Powell, Rt Hon J. E. (S Down)
Hicks, Robert Powley, John
Higgins, Rt Hon Terence L. Proctor, K. Harvey
Hill, James Raison, Rt Hon Timothy
Hind, Kenneth Renton, Tim
Hogg, Hon Douglas (Gr'th'm) Rhodes James, Robert
Holt, Richard Rhys Williams, Sir Brandon
Hordern, Peter Ridley, Rt Hon Nicholas
Howard, Michael Rippon, Rt Hon Geoffrey
Howarth, Alan (Stratf'd-on-A) Roberts, Wyn (Conwy)
Howarth, Gerald (Cannock) Robinson, Mark (N'port W)
Howell, Rt Hon D. (G'ldford) Roe, Mrs Marion
Howell, Ralph (N Norfolk) Rossi, Sir Hugh
Hubbard-Miles, Peter Rost, Peter
Hunt, David (Wirral) Rowe, Andrew
Rumbold, Mrs Angela Thompson, Donald (Calder V)
Ryder, Richard Thompson, Patrick (N'ich N)
Sainsbury, Hon Timothy Thornton, Malcolm
St. John-Stevas, Rt Hon N. Townend, John (Bridlington)
Sayeed, Jonathan Townsend, Cyril D. (B'heath)
Shaw, Giles (Pudsey) Tracey, Richard
Shaw, Sir Michael (Scarb') Trippier, David
Shelton, William (Streatham) Twinn, Dr Ian
Shepherd, Colin (Hereford) van Straubenzee, Sir W.
Shepherd, Richard (Aldridge) Vaughan, Sir Gerard
Shersby, Michael Viggers, Peter
Silvester, Fred Waddington, David
Skeet, T. H. H. Wakeham, Rt Hon John
Smith, Sir Dudley (Warwick) Waldegrave, Hon William
Smith, Tim (Beaconsfield) Walker, Cecil (Belfast N)
Soames, Hon Nicholas Walker, Rt Hon P. (W'cester)
Speed, Keith Wall, Sir Patrick
Speller, Tony Waller, Gary
Spence, John Ward, John
Spencer, Derek Wardle, C. (Bexhill)
Spicer, Michael (S Worcs) Warren, Kenneth
Squire, Robin Watson, John
Stanbrook, Ivor Watts, John
Steen, Anthony Wells, Sir John (Maidstone)
Stern, Michael Whitfield, John
Stevens, Lewis (Nuneaton) Whitney, Raymond
Stevens, Martin (Fulham) Wiggin, Jerry
Stewart, Allan (Eastwood) Wilkinson, John
Stewart, Andrew (Sherwood) Wolfson, Mark
Stokes, John Wood, Timothy
Stradling Thomas, J. Woodcock, Michael
Sumberg, David Yeo, Tim
Taylor, John (Solihull) Young, Sir George (Acton)
Taylor, Teddy (S'end E) Younger, Rt Hon George
Tebbit, Rt Hon Norman
Temple-Morris, Peter Tellers for the Noes:
Thatcher, Rt Hon Mrs M. Mr. Michael Neubert and
Thomas, Rt Hon Peter Mr. Tristan Garel-Jones.

Question accordingly negatived.

Main Question put forthwith pursuant to Standing Order No. 41 (Amendment on Second or Third Reading):

The House divided: Ayes 288, Noes 205.

Division No. 100] [10.13 pm
Adley, Robert Brinton, Tim
Alexander, Richard Brittan, Rt Hon Leon
Alison, Rt Hon Michael Brooke, Hon Peter
Amess, David Brown, M. (Brigg & Cl'thpes)
Ancram, Michael Browne, John
Arnold, Tom Bryan, Sir Paul
Ashby, David Buchanan-Smith, Rt Hon A.
Aspinwall, Jack Buck, Sir Antony
Atkins, Rt Hon Sir H. Budgen, Nick
Atkins, Robert (South Ribble) Bulmer, Esmond
Atkinson, David (B'm'th E) Burt, Alistair
Baker, Rt Hon K. (Mole Vall'y) Butcher, John
Baker, Nicholas (N Dorset) Butler, Hon Adam
Baldry, Tony Butterfill, John
Banks, Robert (Harrogate) Carlisle, John (N Luton)
Beaumont-Dark, Anthony Carlisle, Kenneth (Lincoln)
Beggs, Roy Carttiss, Michael
Bellingham, Henry Cash, William
Bendall, Vivian Chalker, Mrs Lynda
Benyon, William Chapman, Sydney
Best, Keith Chope, Christopher
Biffen, Rt Hon John Churchill, W. S.
Biggs-Davison, Sir John Clark, Sir W. (Croydon S)
Blackburn, John Clarke, Rt Hon K. (Rushcliffe)
Bonsor, Sir Nicholas Clegg, Sir Walter
Boscawen, Hon Robert Cockeram, Eric
Bowden, A. (Brighton K'to'n) Colvin, Michael
Bowden, Gerald (Dulwich) Conway, Derek
Boyson, Dr Rhodes Coombs, Simon
Braine, Rt Hon Sir Bernard Cope, John
Bright, Graham Cormack, Patrick
Crouch, David Johnson Smith, Sir Geoffrey
Currie, Mrs Edwina Jones, Gwilym (Cardiff N)
Dickens, Geoffrey Jones, Robert (W Herts)
Dicks, Terry Joseph, Rt Hon Sir Keith
Dorrell, Stephen Kellett-Bowman, Mrs Elaine
Douglas-Hamilton, Lord J. Key, Robert
Dover, Den King, Roger (B'ham N'field)
du Cann, Rt Hon Sir Edward King, Rt Hon Tom
Dunn, Robert Knight, Gregory (Derby N)
Durant, Tony Knight, Mrs Jill (Edgbaston)
Dykes, Hugh Knowles, Michael
Edwards, Rt Hon N. (P'broke) Knox, David
Emery, Sir Peter Lamont, Norman
Evennett, David Lang, Ian
Eyre, Sir Reginald Latham, Michael
Fairbairn, Nicholas Lawler, Geoffrey
Farr, Sir John Lawrence, Ivan
Favell, Anthony Lawson, Rt Hon Nigel
Fenner, Mrs Peggy Leigh, Edward (Gainsbor'gh)
Finsberg, Sir Geoffrey Lilley, Peter
Forman, Nigel Lloyd, Ian (Havant)
Forsyth, Michael (Stirling) Luce, Richard
Forth, Eric McCrindle, Robert
Fowler, Rt Hon Norman McCurley, Mrs Anna
Fox, Marcus MacGregor, John
Franks, Cecil MacKay, John (Argyll & Bute)
Fraser, Peter (Angus East) Maclean, David John
Freeman, Roger Maginnis, Ken
Galley, Roy Major, John
Garel-Jones, Tristan Malone, Gerald
Glyn, Dr Alan Marland, Paul
Goodlad, Alastair Mather, Carol
Gorst, John Maxwell-Hyslop, Robin
Gow, Ian Mayhew, Sir Patrick
Gower, Sir Raymond Mellor, David
Grant, Sir Anthony Merchant, Piers
Greenway, Harry Miller, Hal (B'grove)
Gregory, Conal Mitchell, David (NW Hants)
Griffiths, Peter (Portsm'th N) Molyneaux, Rt Hon James
Grist, Ian Monro, Sir Hector
Ground, Patrick Morris, M. (N'hampton, S)
Gummer, John Selwyn Morrison, Hon C. (Devizes)
Hamilton, Hon A. (Epsom) Morrison, Hon P. (Chester)
Hamilton, Neil (Tatton) Moynihan, Hon C.
Hampson, Dr Keith Neale, Gerrard
Hannam, John Needham, Richard
Hargreaves, Kenneth Nelson, Anthony
Harris, David Neubert, Michael
Harvey, Robert Newton, Tony
Haselhurst, Alan Nicholls, Patrick
Havers, Rt Hon Sir Michael Norris, Steven
Hawkins, C. (High Peak) Onslow, Cranley
Hawkins, Sir Paul (SW N'folk) Ottaway, Richard
Hawksley, Warren Page, Sir John (Harrow W)
Hayes, J. Parris, Matthew
Hayhoe, Barney Patten, John (Oxford)
Hayward, Robert Pattie, Geoffrey
Heddle, John Peacock, Mrs Elizabeth
Henderson, Barry Pollock, Alexander
Heseltine, Rt Hon Michael Powell, Rt Hon J. E. (S Down)
Hickmet, Richard Powley, John
Hicks, Robert Proctor, K. Harvey
Higgins, Rt Hon Terence L. Raison, Rt Hon Timothy
Hill, James Renton, Tim
Hind, Kenneth Rhodes James, Robert
Hogg, Hon Douglas (Gr'th'm) Rhys Williams, Sir Brandon
Holt, Richard Ridley, Rt Hon Nicholas
Hordern, Peter Rippon, Rt Hon Geoffrey
Howard, Michael Roberts, Wyn (Conwy)
Howarth, Alan (Stratf'd-on-A) Robinson, Mark (N'port W)
Howarth, Gerald (Cannock) Roe, Mrs Marion
Howell, Rt Hon D. (G'ldford) Rossi, Sir Hugh
Howell, Ralph (N Norfolk) Rost, Peter
Hubbard-Miles, Peter Rowe, Andrew
Hunt, David (Wirral) Rumbold, Mrs Angela
Hunter, Andrew Ryder, Richard
Irving, Charles Sainsbury, Hon Timothy
Jackson, Robert St. John-Stevas, Rt Hon N.
Jenkin, Rt Hon Patrick Sayeed, Jonathan
Jessel, Toby Shaw, Giles (Pudsey)
Shaw, Sir Michael (Scarb') Townsend, Cyril D. (B'heath)
Shelton, William (Streatham) Tracey, Richard
Shepherd, Colin (Hereford) Trippier, David
Shepherd, Richard (Aldridge) Twinn, Dr Ian
Shersby, Michael van Straubenzee, Sir W.
Silvester, Fred Vaughan, Sir Gerard
Skeet, T. H. H. Viggers, Peter
Smith, Sir Dudley (Warwick) Waddington, David
Smith, Tim (Beaconsfield) Wakeham, Rt Hon John
Soames, Hon Nicholas Waldegrave, Hon William
Speed, Keith Walker, Cecil (Belfast N)
Spence, John Walker, Rt Hon P. (W'cester)
Spencer, Derek Wall, Sir Patrick
Spicer, Michael (S Worcs) Waller, Gary
Squire, Robin Ward, John
Stanbrook, Ivor Wardle, C. (Bexhill)
Steen, Anthony Warren, Kenneth
Stern, Michael Watson, John
Stevens, Lewis (Nuneaton) Watts, John
Stevens, Martin (Fulham) Wells, Sir John (Maidstone)
Stewart, Allan (Eastwood) Whitfield, John
Stewart, Andrew (Sherwood) Whitney, Raymond
Stokes, John Wiggin, Jerry
Stradling Thomas, J. Wilkinson, John
Sumberg, David Wolfson, Mark
Taylor, John (Solihull) Wood, Timothy
Taylor, Teddy (S'end E) Woodcock, Michael
Tebbit, Rt Hon Norman Yeo, Tim
Temple-Morris, Peter Young, Sir George (Acton)
Thatcher, Rt Hon Mrs M. Younger, Rt Hon George
Thomas, Rt Hon Peter
Thompson, Donald (Calder V) Tellers for the Ayes:
Thompson, Patrick (N'ich N) Mr. Mark Lennox-Boyd and
Thornton, Malcolm Mr. Peter Lloyd.
Townend, John (Bridlington)
Abse, Leo Concannon, Rt Hon J. D.
Adams, Allen (Paisley N) Conlan, Bernard
Alton, David Cook, Frank (Stockton North)
Anderson, Donald Cook, Robin F. (Livingston)
Archer, Rt Hon Peter Cowans, Harry
Ashdown, Paddy Cox, Thomas (Tooting)
Ashley, Rt Hon Jack Craigen, J. M.
Ashton, Joe Crowther, Stan
Atkinson, N. (Tottenham) Cunliffe, Lawrence
Bagier, Gordon A. T. Cunningham, Dr John
Banks, Tony (Newham NW) Dalyell, Tarn
Barnett, Guy Davies, Rt Hon Denzil (L'lli)
Barron, Kevin Davies, Ronald (Caerphilly)
Beckett, Mrs Margaret Davis, Terry (B'ham, H'ge H'l)
Beith, A. J. Deakins, Eric
Bennett, A. (Dent'n & Red'sh) Dewar, Donald
Bidwell, Sydney Dixon, Donald
Blair, Anthony Dobson, Frank
Boothroyd, Miss Betty Dormand, Jack
Boyes, Roland Douglas, Dick
Bray, Dr Jeremy Dubs, Alfred
Brown, Gordon (D'f'mline E) Duffy, A. E. P.
Brown, Hugh D. (Provan) Dunwoody, Hon Mrs G.
Brown, N. (N'c'tle-u-Tyne E) Eadie, Alex
Brown, Ron (E'burgh, Leith) Eastham, Ken
Bruce, Malcolm Ellis, Raymond
Buchan, Norman Evans, John (St. Helens N)
Caborn, Richard Ewing, Harry
Callaghan, Jim (Heyw'd & M) Fatchett, Derek
Campbell, Ian Fields, T. (L'pool Broad Gn)
Campbell-Savours, Dale Fisher, Mark
Carlile, Alexander (Montg'y) Flannery, Martin
Carter-Jones, Lewis Foot, Rt Hon Michael
Clark, Dr David (S Shields) Forrester, John
Clarke, Thomas Foster, Derek
Clay, Robert Foulkes, George
Clwyd, Mrs Ann Fraser, J. (Norwood)
Cocks, Rt Hon M. (Bristol S.) Freeson, Rt Hon Reginald
Cohen, Harry Freud, Clement
Coleman, Donald Garrett, W. E.
George, Bruce Nellist, David
Gilbert, Rt Hon Dr John Oakes, Rt Hon Gordon
Godman, Dr Norman O'Brien, William
Golding, John O'Neill, Martin
Gould, Bryan Orme, Rt Hon Stanley
Gourlay, Harry Owen, Rt Hon Dr David
Hamilton, James (M'well N) Park, George
Hamilton, W. W. (Central Fife) Parry, Robert
Hancock, Mr. Michael Patchett, Terry
Hardy, Peter Pavitt, Laurie
Harman, Ms Harriet Penhaligon, David
Harrison, Rt Hon Walter Pike, Peter
Hart, Rt Hon Dame Judith Prescott, John
Hattersley, Rt Hon Roy Randall, Stuart
Heffer, Eric S. Redmond, M.
Hogg, N. (C'nauld & Kilsyth) Rees, Rt Hon M. (Leeds S)
Holland, Stuart (Vauxhall) Richardson, Ms Jo
Home Robertson, John Roberts, Allan (Bootle)
Howell, Rt Hon D. (S'heath) Roberts, Ernest (Hackney N)
Howells, Geraint Robertson, George
Hoyle, Douglas Robinson, G. (Coventry NW)
Hughes, Dr. Mark (Durham) Rogers, Allan
Hughes, Robert (Aberdeen N) Ross, Stephen (Isle of Wight)
Hughes, Roy (Newport East) Rowlands, Ted
Hughes, Sean (Knowsley S) Sedgemore, Brian
Hughes, Simon (Southwark) Sheerman, Barry
John, Brynmor Sheldon, Rt Hon R.
Johnston, Russell Shore, Rt Hon Peter
Jones, Barry (Alyn & Deeside) Short, Ms Clare (Ladywood)
Kaufman, Rt Hon Gerald Short, Mrs R. (W'hampt'n NE)
Kennedy, Charles Skinner, Dennis
Kirkwood, Archy Smith, C. (Isl'ton S & F'bury)
Lambie, David Smith, Cyril (Rochdale)
Lamond, James Smith, Rt Hon J. (M'kl'ds E)
Lead bitter, Ted Snape, Peter
Leighton, Ronald Soley, Clive
Lewis, Ron (Carlisle) Spearing, Nigel
Lewis, Terence (Worsley) Steel, Rt Hon David
Litherland, Robert Stewart, Rt Hon D. (W Isles)
Lloyd, Tony (Stretford) Stott, Roger
Lofthouse, Geoffrey Strang, Gavin
Loyden, Edward Straw, Jack
McCartney, Hugh Thomas, Dafydd (Merioneth)
McDonald, Dr Oonagh Thomas, Dr R. (Carmarthen)
McGuire, Michael Thompson, J. (Wansbeck)
McKay, Allen (Penistone) Thorne, Stan (Preston)
McKelvey, William Tinn, James
Mackenzie, Rt Hon Gregor Torney, Tom
Maclennan, Robert Wainwright, R.
McNamara, Kevin Wardell, Gareth (Gower)
McTaggart, Robert Wareing, Robert
McWilliam, John Weetch, Ken
Madden, Max Welsh, Michael
Marek, Dr John White, James
Marshall, David (Shettleston) Wigley, Dafydd
Mason, Rt Hon Roy Williams, Rt Hon A.
Maynard, Miss Joan Winnick, David
Meacher, Michael Woodall, Alec
Meadowcroft, Michael Wrigglesworth, Ian
Michie, William Young, David (Bolton SE)
Mikardo, Ian
Millan, Rt Hon Bruce Tellers for the Noes:
Miller, Dr M. S. (E Kilbride) Mr. Frank Haynes and
Mitchell, Austin (G't Grimsby) Mr. John Maxton.
Morris, Rt Hon J. (Aberavon)

Bill accordingly read a Second time and committed to a Standing Committee pursuant to Standing Order No. 42 (Committal of Bills).