§ Mr. Roger Knapman (Stroud)I beg to move,
That leave be given to bring in a Bill to privatise railway termini.I am much encouraged in this respect by the remarks of my right hon. Friend the Chancellor of the Exchequer, who recently said:We will privatise what we consider is sensible to privatise and what is ready to privatise.It would seem that with British Steel and the water and electricity industries next in line for privatisation, the railways will have to wait their turn. It may be true that the railway industry is not quite ready to be privatised, at least as a whole, but it is certain that the railways require considerable investment at this time, and that investment could and should be raised from existing, sometimes under-used and certainly under-valued, assets.In a recent article in the Fianancial Times, under the heading,
British Rail running on successful lines",I noticed the following comments:British Rail's record results in the year to the end of March reflect the boom in the economy and the upsurge in passenger traffic. They come at a time when its detailed performance is under scrutiny by the Government as it considers options, including privatisation, for the future ownership of the railways. The figures were further boosted by a cut in operating costs and higher productivity, higher Government grants and a record sale of assets, mainly property, which produced a gross cash contribution of £263 million to British Rail.The sale of peripheral activities has been a great success. It includes the sale of Sealink and British Transport Hotels, and more recently of British Rail Engineering Ltd and the privatisation of certain catering activities. However, it is British Rail property that will raise the huge sums that are now required for reinvestment in the railway system. At present, such properties are dealt with in two main ways: first, the sale of surplus and redundant land; and, secondly, station trading.With regard to the sale of surplus and redundant land, I was interested to note a recent written question from my hon. Friend the Member for Eastbourne (Mr. Gow), who asked the Secretary of State for Transport
how much land, surplus to operational requirements, was owned by British Rail on 30 September 1987; and what discussions he has had with the chairman of British Rail concerning progress in selling such land.The reply was:I understand from the BR. Property Board that the total was some 17,300 acres. We have asked British Rail to dispose of all its surplus land and property as rapidly as possible.I discussed a variety of matters with the chairman of the BR Property Board in December, including progress in this area."—[Official Report, 19 January 1988; Vol. 125, c. 699–700.]Quite so.It is relevant to compare the rail operating profits achieved last year of £109 million with the total of £184 million raised from the sale of properties last year.
I turn, secondly, to station trading, that is, the management of concourse-based retail outlets, which should net about £15 million in rental income this year. British Rail has long been in the business of leasing parts of stations to private sector undertakings, going back to the days of newspaper stands. This is now big business, at 1103 least at the larger London stations, which have branches of many leading retailers. The scope for it depends to some extent on the size and layout of the stations concerned.
Waterloo and Victoria both have large concourses and plenty of room for non-railway activities. Paddington, Charing Cross and Cannon Street are all rather smaller and with rather less scope for such franchising. At Euston there are shops on British Rail property around the station, but relatively few inside it. I suspect that most opportunities are already being exploited as part of British Rail's general policy of getting maximum return from the properties it owns.
This is the crux of the matter. If British Rail can lease out parts of stations—that has been proved over many years—it must equally be possible to sell the terminus stations and lease back to British Rail the parts that it needs. Most commercial operations undertake the sale and leaseback of properties in that way, and in this case hundreds of millions of pounds could be raised with few complications and with no effect on the efficient running of the railways. In fact, quite the reverse in this case, because British Rail would at long last be asked to focus clearly on which assets it needs to own and which it does not. The receipts should then be made available and be better used for track or rolling stock, or what might be appropriately called this week the "railway core curriculum".
To bring that about an agreement would be reached with British Rail and, in due course, with others to define the areas needed for the efficient running of the railways. When that had been decided a payment would be made by British Rail, possibly on a per train or per passenger coach basis. In addition, British Rail would accept the liability to maintain the tracks, platforms and signalling equipment.
Secondly, a means of evaluation would be determined. It would, of course, be for each bidder to assess the appropriate figure for capitalisation of the incomes, whether actual or estimated, and to allow a figure for the prospects of future planning permission. Because British Rail would be paying for the usage of its part on a per train or a per coach basis, the income could be assessed and capitalised. The remainder of the properties already produce rental income, and those could also be capitalised. Therefore, an assessment of freehold value could readily be made, and I am sure that many offers would be received for the major properties.
The basic commercial observation must be that any organisation which trades at a loss would be expected to sell off assets either to meet that loss or to provide needed investment. The recently published annual accounts show that last year there was an increase of 8 per cent. in passenger volume. That was the highest figure since 1961. I am not at all surprised that that is the case in the London area, especially since the recent revelation that average motor speeds in central London at 8 mph compare unfavourably with speeds in the days of the horse and cart. No wonder that the chairman of British Rail was recently able to observe:
British Rail is in danger of becoming a victim of its own success.The success to which he refers is attracting extra passengers, especially in the south-east.Increased usage of the rail system highlights a certain and urgent necessity—increased investment. I recently asked my right hon. Friend the Secretary of State for 1104 Transport how much British Rail had invested since 1979, and I am obliged to him for his reply, which was £3.7 billion. I understand that another £3 billion will be made available over the next five years or so. The sale of fixed assets, and in particular railway termini, is a promising extra source of finance to meet the increasing demands of the railway system.
The increasing needs of the railway system are no longer caused by an ever-increasing annual trading deficit, but are caused by the need for change, modernisation and capital expenditure within an expanding industry. My proposals will not interfere with the prospects of a properly integrated travel system. British Airways does not own, and does not need to own, Heathrow or Gatwick airports. By the same token, I suggest that British Rail does not need to own Paddington, King's Cross or Euston to conduct its business.
§ Mr. Jeremy Corbyn (Islington, North)rose——
§ Mr. Deputy Speaker (Mr. Harold Walker)Does the hon. Gentleman wish to oppose the Bill?
§ Mr. CorbynYes, Mr. Deputy Speaker.
The hon. Member for Stroud (Mr. Knapman) failed to tell us what powers he seeks to include in the Bill or what it is intended to do. He merely reiterated a litany of bits of property that he and his friends would like to grab in order to destroy or weaken the rail network. He showed a woeful ignorance of the history of the railway system and the railway industry. In case the hon. Gentleman is not aware of it, I can tell him that the railway system was built in an ad hoc way by private enterprise. That is why some of the lines run in the wrong places and why so many termini are badly placed.
Because of a lack of investment in the railway system, in 1947 the post-war Labour Government were forced to save the railways by nationalising them. Had they not done that and established for the first time a truly integrated transport system we would be in an awful mess today, as the hon. Gentleman knows perfectly well. There would be no rich pickings for him to try to grab.
The hon. Gentleman should also remember that the sale of British Transport Hotels, British Rail Engineering Ltd. and Sealink have two things in common. First, massive amounts of public money were invested in those services, which were then sold off to friends of the Tory party at knockdown prices so that they could make large profits. Secondly, large numbers of the workers in those industries were thrown on the dole. The hon. Gentleman will be aware that my hon. Friends the Members for Linlithgow (Mr. Dalyell) and for Wrexham (Dr. Marek) are in the Chamber, and in the House they represent the interests of the National Union of Railwaymen. They have fought strongly to preserve the jobs of railway workers, who are committed to a safe, efficient transport network. The Bill would cause the destruction of the integrated railway network that has developed since 1947.
It is clear that the hon. Member for Stroud has not examined the annual report of British Rail, because it shows that the financial performance of BR depends to a great extent on its ownership of the railway termini and of subsidiary facilities operating on trains or at stations, and that the £130 million surplus owes a great deal to those subsidiary facilities. The hon. Gentleman knows perfectly 1105 well that if he gives away the profitable bits of BR the public sector will be left to pick up the cost. In effect, public sector money has subsidised the facilities which the hon. Gentleman is trying to give away to the private sector.
The hon. Gentleman's proposals to give away Travellers Fare are interesting. The annual report fails to give a proper account of Travellers Fare. He is aware that last year Travellers Fare made a surplus of £7.5 million.
The hon. Gentleman also knows that his proposals to weaken, break up and privatise the rail system will mean that £3.7 billion of taxpayers' money, which has been given by the public to develop an integrated transport network, will pass into private hands. That will result in an inefficient transport system, higher fares and job losses.
I believe that the House should show the wisdom that it showed in 1947 when it established a unified transport system. If the rail network is broken up as a result of the piecemeal proposals put forward in the Bill, we will end up with a much weaker transport system and job losses. Frankly, all that has happened this afternoon is that a bunch of spivs have come into the Chamber to make a fast buck for their friends. They have come here to try to give away public assets so that their friends can make large profits.
I believe that we owe it to the people of this country to retain an integrated rail network, because it is safe, environmentally good, cheap and the best way to run a transport network. The hon. Gentleman and his supporters represent the antithesis of everything to do with social planning and the efficient and intelligent management of the economy. I hope that the House will reject the Bill.
§ Question put, pursuant to Standing Order No. 19 ( Motions for leave to bring in Bills and Nomination of Select Committees at Commencement of Public Business):—
§ The House divided: Ayes 108, Noes 161.
1107| Division No. 425] | [3.55 |
| AYES | |
| Alexander, Richard | Davis, David (Boothferry) |
| Amos, Alan | Day, Stephen |
| Arnold, Jacques (Gravesham) | Fenner, Dame Peggy |
| Beaumont-Dark, Anthony | Field, Barry (Isle of Wight) |
| Bennett, Nicholas (Pembroke) | Finsberg, Sir Geoffrey |
| Bevan, David Gilroy | Fishburn, John Dudley |
| Biggs-Davison, Sir John | Forth, Eric |
| Blackburn, Dr John G. | Fox, Sir Marcus |
| Bonsor, Sir Nicholas | French, Douglas |
| Boswell, Tim | Gale, Roger |
| Bowden, Gerald (Dulwich) | Gill, Christopher |
| Bowis, John | Glyn, Dr Alan |
| Boyson, Rt Hon Dr Sir Rhodes | Goodhart, Sir Philip |
| Braine, Rt Hon Sir Bernard | Gow, Ian |
| Brazier, Julian | Greenway, Harry (Ealing N) |
| Bright, Graham | Hamilton, Neil (Tatton) |
| Brown, Michael (Brigg & Cl't's) | Hargreaves, A. (B'ham H'll Gr') |
| Browne, John (Winchester) | Hargreaves, Ken (Hyndburn) |
| Buck, Sir Antony | Hicks, Mrs Maureen (Wolv' NE) |
| Butler, Chris | Holt, Richard |
| Carrington, Matthew | Hunter, Andrew |
| Cash, William | Irvine, Michael |
| Chapman, Sydney | Janman, Tim |
| Clark, Dr Michael (Rochford) | Jessel, Toby |
| Colvin, Michael | Jones, Robert B (Herts W) |
| Conway, Derek | Kellett-Bowman, Dame Elaine |
| Coombs, Anthony (Wyre F'rest) | Kilfedder, James |
| Coombs, Simon (Swindon) | King, Roger (B'ham N'thfield) |
| Curry, David | Kirkhope, Timothy |
| Davies, Q. (Stamf'd & Spald'g) | Knapman, Roger |
| Leigh, Edward (Gainsbor'gh) | Rost, Peter |
| Lloyd, Sir Ian (Havant) | Shaw, David (Dover) |
| McCrindle, Robert | Shephard, Mrs G. (Norfolk SW) |
| Macfarlane, Sir Neil | Shersby, Michael |
| McLoughlin, Patrick | Sims, Roger |
| McNair-Wilson, P. (New Forest) | Skeet, Sir Trevor |
| Mans, Keith | Smith, Tim (Beaconsfield) |
| Marland, Paul | Stanbrook, Ivor |
| Martin, David (Portsmouth S) | Stewart, Allan (Eastwood) |
| Meyer, Sir Anthony | Summerson, Hugo |
| Mitchell, Andrew (Gedling) | Taylor, Ian (Esher) |
| Moate, Roger | Thorne, Neil |
| Monro, Sir Hector | Tracey, Richard |
| Montgomery, Sir Fergus | Walden, George |
| Morris, M (N'hampton S) | Wardle, Charles (Bexhill) |
| Moss, Malcolm | Warren, Kenneth |
| Mudd, David | Watts, John |
| Onslow, Rt Hon Cranley | Wheeler, John |
| Oppenheim, Phillip | Widdecombe, Ann |
| Paice, James | Wilkinson, John |
| Patnick, Irvine | Wilshire, David |
| Pawsey, James | |
| Porter, David (Waveney) | Tellers for the Ayes: |
| Raison, Rt Hon Timothy | Mr. David Nicholson and |
| Redwood, John | Mr. James Cran |
| Riddick, Graham |
| NOES | |
| Adams, Allen (Paisley N) | Fisher, Mark |
| Allen, Graham | Flannery, Martin |
| Alton, David | Foot, Rt Hon Michael |
| Anderson, Donald | Forsythe, Clifford (Antrim S) |
| Armstrong, Hilary | Foster, Derek |
| Ashley, Rt Hon Jack | Fyfe, Maria |
| Barnes, Harry (Derbyshire NE) | Galbraith, Sam |
| Barnes, Mrs Rosie (Greenwich) | Galloway, George |
| Barron, Kevin | Garrett, John (Norwich South) |
| Battle, John | Garrett, Ted (Wallsend) |
| Beckett, Margaret | George, Bruce |
| Beith, A. J. | Godman, Dr Norman A. |
| Benn, Rt Hon Tony | Golding, Mrs Llin |
| Bermingham, Gerald | Graham, Thomas |
| Bidwell, Sydney | Griffiths, Win (Bridgend) |
| Boyes, Roland | Grocott, Bruce |
| Brown, Nicholas (Newcastle E) | Hardy, Peter |
| Buckley, George J. | Haynes, Frank |
| Caborn, Richard | Heffer, Eric S. |
| Callaghan, Jim | Henderson, Doug |
| Campbell, Ron (Blyth Valley) | Hinchliffe, David |
| Campbell-Savours, D. N. | Hogg, N. (C'nauld & Kilsyth) |
| Canavan, Dennis | Home Robertson, John |
| Cartwright, John | Hood, Jimmy |
| Clark, Dr David (S Shields) | Howarth, George (Knowsley N) |
| Clarke, Tom (Monklands W) | Hughes, John (Coventry NE) |
| Clay, Bob | Hughes, Roy (Newport E) |
| Clwyd, Mrs Ann | Hughes, Sean (Knowsley S) |
| Cohen, Harry | Hughes, Simon (Southwark) |
| Coleman, Donald | Illsley, Eric |
| Cook, Frank (Stockton N) | Ingram, Adam |
| Cook, Robin (Livingston) | Janner, Greville |
| Corbett, Robin | Jones, Barry (Alyn & Deeside) |
| Corbyn, Jeremy | Jones, Martyn (Clwyd S W) |
| Cousins, Jim | Kirkwood, Archy |
| Cryer, Bob | Lambie, David |
| Cummings, John | Lamond, James |
| Cunliffe, Lawrence | Leighton, Ron |
| Dalyell, Tam | Lewis, Terry |
| Darling, Alistair | Litherland, Robert |
| Davies, Ron (Caerphilly) | Lloyd, Tony (Stretford) |
| Davis, Terry (B'ham Hodge H'l) | Lofthouse, Geoffrey |
| Dixon, Don | Loyden, Eddie |
| Dobson, Frank | McAllion, John |
| Duffy, A. E. P. | McAvoy, Thomas |
| Dunnachie, Jimmy | McCartney, Ian |
| Eastham, Ken | McKay, Allen (Barnsley West) |
| Ewing, Harry (Falkirk E) | McKelvey, William |
| Fatchett, Derek | McLeish, Henry |
| Faulds, Andrew | McNamara, Kevin |
| Field, Frank (Birkenhead) | Madden, Max |
| Fields, Terry (L'pool B G'n) | Mahon, Mrs Alice |
| Mallon, Seamus | Rowlands, Ted |
| Marshall, David (Shettleston) | Ruddock, Joan |
| Marshall, Jim (Leicester S) | Sedgemore, Brian |
| Martin, Michael J. (Springburn) | Sheldon, Rt Hon Robert |
| Martlew, Eric | Shore, Rt Hon Peter |
| Maxton, John | Short, Clare |
| Michael, Alun | Skinner, Dennis |
| Michie, Bill (Sheffield Heeley) | Smith, C. (Isl'ton & F'bury) |
| Michie, Mrs Ray (Arg'l & Bute) | Smith, Rt Hon J. (Monk'ds E) |
| Millan, Rt Hon Bruce | Soley, Clive |
| Morgan, Rhodri | Spearing, Nigel |
| Morley, Elliott | Steinberg, Gerry |
| Morris, Rt Hon A. (W'shawe) | Strang, Gavin |
| O'Brien, William | Straw, Jack |
| O'Neill, Martin | Turner, Dennis |
| Parry, Robert | Vaz, Keith |
| Patchett, Terry | Wall, Pat |
| Pike, Peter L. | Walley, Joan |
| Powell, Ray (Ogmore) | Wareing, Robert N. |
| Primarolo, Dawn | Welsh, Michael (Doncaster N) |
| Quin, Ms Joyce | Wigley, Dafydd |
| Radice, Giles | Williams, Alan W. (Carm'then) |
| Redmond, Martin | Wilson, Brian |
| Rees, Rt Hon Merlyn | Winnick, David |
| Reid, Dr John | Wise, Mrs Audrey |
| Roberts, Allan (Bootle) | Young, David (Bolton SE) |
| Robertson, George | |
| Robinson, Geoffrey | Tellers for the Noes: |
| Rogers, Allan | Mr. Tony Banks and |
| Rooker, Jeff | Dr. John Marek |
| Ross, Ernie (Dundee W) |
§ Question accordingly negatived.