§ Mr. Nicholas Bennett (Pembroke)I beg to move,
That leave be given to bring in a Bill to provide for the privatisation of British Rail.When I tabled the Bill in July, I little imagined that my right hon. Friend the Secretary of State for Transport would make such a robust speech about privatisation at the Conservative party conference. What I seek to do today is to persuade the Government of the best option—[Interruption.]
§ Mr. SpeakerOrder. Will hon. Members who are not staying for the ten-minute Bill please leave quietly?
§ Mr. BennettBritish Rail management has much improved some of its activities under the leadership of Bob Reid, but British Rail is still a producer-led monopoly which, all too often, puts the interests of its staff before those of its customers. It is appropriate that the hon. Member for West Bromwich, East (Mr. Snape) is to oppose the Bill as the hon. Gentleman is sponsored by the largest producer union—the National Union of Railwaymen. I seek to speak on behalf of a much larger group—the rail passengers.
British Rail is still conservative and unimaginative. Its marketing is still half-baked. Staff are often slovenly and lack pride in their job and even in their appearance. The catering services are never available when the passenger wants them. Cancellations, delays, dirty stock and overcrowding are still prevalent.
Across the world, Governments are turning to the private sector to help them to operate their railway systems. The biggest example to date is Japan, which privatised its railways last year. The United States has private railways, although its problems of size often give the airlines a competitive edge. In South America, Chile, Brazil and Argentina are to privatise their railways. In the far east, Malaysia and Thailand are to privatise. In Europe, Finland is splitting its train budget into two so that the cost of track is separated from operating costs, and the West German Government are questioning the cost of their railway system.
In the short term, we could privatise station and carriage cleaning, maintenance, train catering, security, portering and other services that could easily be hived off from the main railway operation. We could also set in train a number of experiments. At least three major towns in the United Kingdom are served by lines from two different main line stations in London. Exeter is served by Waterloo and Paddington; Birmingham, by Paddington and Euston; and Cambridge, by Liverpool street and King's Cross. It would be perfectly proper and feasible for different operators to operate services to those three towns. My hon. Friend the Member for Isle of Wight (Mr. Field) has already suggested that the service in the Isle of Wight could be hived off to a private operator with no connection with the British Rail system.
In the longer term, privatisation must be predicated on three principles. First, safety must be the paramount concern. Secondly, there must be an improvement for passengers. Thirdly, there must be continued support for rural and social services. I do not believe that British Rail's preferred option is the right one. British Rail proposes to 178 privatise as a private monopoly. Bearing in mind our experience with British Gas, I do not believe that the customer would want that to happen.
The general principle of privatisation would release British Rail and the railway system from the Treasury-controlled external financing limit. British Rail could then go into the market and seek investment for its own schemes without the concern of the Government. So there are serious competitors ranged against the No. 1 option. We must make sure that British Rail's competition is internal as well as external. I do not accept the board's argument that competition with buses and airlines is enough. We must have internal competition so that British Rail's costs are brought under control and the organisation is made accountable to the passengers.
I therefore propose that a rail authority should be established to ensure conditions of safety and fair play. Below that would be five or six regional infrastructure companies with responsibility for stations, signals and track. These companies should be allowed to run trains so that we can see the competitive costs of different train operations. In addition, there should be a third tier under which operating companies would have a statutory right to operate trains in time slots, which could be allotted. In a minor way, that system exists already. The Orient Express operates on British Rail track; Foster Yeoman operates its own class 59 locomotives and wagons on British Rail track. Productivity levels of those outfits are far higher than those of British Rail's freight operation. Fourteen thousand five hundred freight wagons are already in use.
Safety should be the main responsibility of the regulatory rail authority. The benefits of competition derived from a variety of operators and types of service will be useful to passengers. The railway unions' arguments are so facile that they should be knocked down now. First, they say that trains cannot overtake, but of course they do. Many train timetable systems are organised in flights to maximise capacity. British Rail speeds vary between 35 milies an hour for freight pick-up to 125 miles an hour on Intercity, and fast and slow trains run on the same track with overtaking loops, fast tracks through stations and two-track signal lines by directional working. So, already, the possibility exists of running trains with different operators at different speeds. With timetable computerisation and inter-regional working provided through an attractive financial package, competition will be maximised by market forces.
What about breakdowns? At the moment, there is no redress from British Rail if a train breaks down. Passengers grin and bear it. Commercial operators have some form of redress in the form of financial claims against the railway system. The third tier option with different operators will ensure that the service is better by providing for financial penalties against operators who do not run their trains efficiently.
Finally, I turn to rural and social routes. We need proper costing of wear on tracks. We must abolish the public service obligation grants and replace them with line service grants with central and local government input. That is what we have done with the bus system— subsidised the service, not the system. Let us ensure that public money goes to the services that the public judge to be in need of social subsidy.
179 My Bill seeks to place the passengers first and to give them a service comparable with that of Marks and Spencer or Sainsbury, rather than the sort of service that they have had to endure for the past 40 years.
§ Mr. SpeakerIs the hon. Gentleman seeking to oppose the Bill?
§ Mr. SnapeYes, Sir.
As a member of the National Union of Railwaymen I may say that I have never heard so much claptrap in all my life. So much of the case for rail privatisation has a quaint, antiquated, back-to-the-future quality about it.
The hon. Member for Pembroke (Mr. Bennett) propounded a track authority approach to privatisation, a line of argument usually associated with the Adam Smith Institute. There is a name to conjure with—that of a man who was born in 1723 and died in 1790, before railways were even invented. How did he manage to pass on these gems to the hon. Member for Pembroke?
The Centre for Policy Studies, a group of Right-wing teenage ideologues, has issued its report on privatisation, "Reviving the Railways", subtitled "A Victorian Future", which is a fantasy of recreating not only the four pre-1947 companies but of going further back into the past to pre-1923, when there were almost 150 railway companies. We have been there before. It did not work then, and will not work now. What is the great and glorious past to which the hon. Gentleman and his right hon. and hon. Friends wish to return? In the 10 years before the second world war, three of the four private railway companies never paid a dividend of more than 1 per cent. on ordinary shares. Even the Great Western Railway rarely paid a dividend of more than 3 per cent.
§ Mr. BennettWhat does that have to do with it?
§ Mr. SnapeIf the hon. Gentleman will shut up, I shall tell him.
Under the present Government, Intercity services are supposed to bring a return of 2.7 per cent.—hardly the kind of figure to attract those lager-swilling yuppies from the City about whom we read so much. The returns of the 1920s and 1930s are also fairly pathetic when compared with the results now sought by the City of London.
As to the so-called golden age of efficiency and competition in the 1920s and 1930s, when the free market gave us service with a smile, it is interesting to draw comparisons with one or two modern routes. In 1938, there were 26 trains a day between Bournemouth and London. There are currently 64. In 1938, the fastest journey time on that route was 116 minutes. Today it is 96 minutes.
It is true that in 1938 there were two competing railway companies on the London to Birmingham route, when there were 22 trains running daily. Some left from Euston and others from Paddington. However, they did not operate on a fixed frequency. If one missed the train from Euston, one also missed the train from Paddington. That was because, at least in theory, they were competing against each other. Today, 33 trains run daily between London and Birmingham. In 1938, the fastest journey time 180 was 1 hour 55 minutes, whereas today, not counting the Pullman, it is 1 hour 32 minutes. That is a significant improvement.
If one considers the hon. Gentleman's own constituency of Pembroke, it is difficult to imagine too many City whizzkids being anxious to run a service to that far-flung outpost. Had the hon. Gentleman propounded his childish and infantile ideas in his own constituency on a Sunday in 1938, it would have taken him 9 hours 22 minutes to return to London—some might think, a good thing too. In 1988, he can be back in London boring the rest of us in only 6 hours 19 minutes. That is not bad for a nationalised railway in 50 years. The truth is that the golden age of railways never existed—particularly in the 1930s.
No one should be in any doubt about the positive achievements of the publicly owned rail system—[Interruption.] I hope that the hon. Member for Pembroke, having made his own case, will have the courtesy to listen to my reply. He did not make his case very well, and I am trying to speak slowly because I know that the hon. Gentleman cannot think very quickly.
Today, the railway carries more passengers than at any time in the 1920s, when private car ownership became a reality. Today's railway system carries its passengers faster and—provided one can get a seat, which is not always possible—at a higher standard of comfort than ever before. Also, it costs the Exchequer far less than it costs the Governments of any of our European neighbours to run their passenger rail services.
It is significant that, after 10 years of Conservative Government and of being told by them how well British Rail management is running its services, we are now informed by the hon. Member for Pembroke that those services are dirty and unpunctual. Some of them are, and I myself have been known to complain about them. However, there is nothing wrong with British Rail that proper funding would not put right; anybody who cares about the future of our national rail system knows that to be so.
The track authority concept to which the hon. Gentleman referred is also, in railway terms, a non-starter. There are, I suppose, some rather lucrative pieces of real estate around British Rail stations and tracks. The track authority would rent out space for competing services run by private operating companies. Anyone with a shred of knowledge about operating practices would know just how impracticable is that idea.
If there is an up line and a down line between two cities, and a train full of proles run by one company comes to a standstill on the up line, it is no use the champagne swiggers on the Orient Express behind trying to overtake—it is not possible on a two-track railway. Unlike bus deregulation, one cannot cut short the route, jump the traffic lights, or miss out passengers standing at a bus stop in order to beat one's competitors. Fortunately, there are safety standards which guarantee that few railway passengers lose their lives in the course of a year compared with the 5,000 or so people who are killed on Britain's roads.
The hon. Gentleman has palpably failed to prove his case. He has, predictably for him, not listened to the alternative because he is too busy involved in conversation with his hon. Friends. One would have thought that such a passionate advocate of the free market had come from nowhere to the top of a major publicly quoted company; 181 that he started as the office boy and ended up as the chairman. As a matter of fact, according to "Who's Who", before he came here the hon. Gentleman was a school-teacher, after which he became a full-time bureaucrat—I hesitate to use that word, although that is the sort of language that Conservative Members use—with the Inner London education authority in one of the London boroughs. Far from exposing himself to an icy bath full of private enterprise water, he has had rather a comfortable existence in the municipal sector.
I have some advice for the hon. Gentleman as a result of listening to him this afternoon. I shall buy him a junior engine spotter's notebook so that he can discover something about the railway system by travelling around a bit. When he comes back and gets a bit bigger I shall even get him a ride on an engine, providing that he can prove that he has learnt something about the railway system.
The trouble with those infants on the Conservative Benches is that they know nothing and care even less about the passengers or those who work within the railway industry. Those Conservative Members who do—I know that there are some—should join me and my hon. Friends in voting against this silly and childish motion this afternoon.
§ 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 109,Noes 184.
182| Division No. 476] | [4.01 pm |
| AYES | |
| Alexander, Richard | Goodson-Wickes, Dr Charles |
| Alison, Rt Hon Michael | Gorman, Mrs Teresa |
| Banks, Robert (Harrogate) | Gorst, John |
| Bennett, Nicholas (Pembroke) | Gow, Ian |
| Blackburn, Dr John G. | Grant, Sir Anthony (CambsSW) |
| Boswell, Tim | Greenway, Harry (Ealing N) |
| Bowis, John | Gregory, Conal |
| Brazier, Julian | Ground, Patrick |
| Brown, Michael (Brigg & Cl't's) | Hayes, Jerry |
| Bruce, Ian (Dorset South) | Hayward, Robert |
| Buck, Sir Antony | Hicks, Mrs Maureen (Wolv' NE) |
| Budgen, Nicholas | Hind, Kenneth |
| Burns, Simon | Hordern, Sir Peter |
| Burt, Alistair | Howarth, G. (Cannock & B'wd) |
| Butler, Chris | Howell, Ralph (North Norfolk) |
| Carlisle, John, (Luton N) | Hughes, Robert G. (Harrow W) |
| Carrington, Matthew | Hunter, Andrew |
| Clark, Dr Michael (Rochford) | Janman, Tim |
| Clark, Sir W. (Croydon S) | Jessel, Toby |
| Colvin, Michael | Johnson Smith, Sir Geoffrey |
| Curry, David | Jones, Robert B (Herts W) |
| Davies, Q. (Stamf'd & Spald'g) | Jopling, Rt Hon Michael |
| Day, Stephen | Kirkhope, Timothy |
| Devlin, Tim | Knapman, Roger |
| Dickens, Geoffrey | Knight, Dame Jill (Edgbaston) |
| Dunn, Bob | Latham, Michael |
| Emery, Sir Peter | Lawrence, Ivan |
| Evans, David (Welwyn Hatf'd) | Leigh, Edward (Gainsbor'gh) |
| Evennett, David | Lloyd, Sir Ian (Havant) |
| Fairbairn, Sir Nicholas | Lord, Michael |
| Fenner, Dame Peggy | McCrindle, Robert |
| Field, Barry (Isle of Wight) | MacKay, Andrew (E Berkshire) |
| Fishburn, John Dudley | McLoughlin, Patrick |
| Fox, Sir Marcus | McNair-Wilson, Sir Michael |
| Franks, Cecil | Mans, Keith |
| French, Douglas | Marland, Paul |
| Gale, Roger | Marlow, Tony |
| Gardiner, George | Martin, David (Portsmouth S) |
| Gill, Christopher | Mitchell, Andrew (Gedling) |
| Glyn, Dr Alan | Montgomery, Sir Fergus |
| Mudd, David | Stanbrook, Ivor |
| Neale, Gerrard | Taylor, Ian (Esher) |
| Nelson, Anthony | Taylor, Teddy (S'end E) |
| Nicholson, David (Taunton) | Tebbit, Rt Hon Norman |
| Onslow, Rt Hon Cranley | Thompson, Patrick (Norwich N) |
| Oppenheim, Phillip | Thornton, Malcolm |
| Patnick, Irvine | Walden, George |
| Pawsey, James | Warren, Kenneth |
| Porter, David (Waveney) | Watts, John |
| Redwood, John | Wheeler, John |
| Roe, Mrs Marion | Wood, Timothy |
| Rossi, Sir Hugh | Yeo, Tim |
| Shaw, David (Dover) | |
| Shephard, Mrs G. (Norfolk SW) | Tellers for the Ayes: |
| Shersby, Michael | Miss Ann Widdecombe and |
| Skeet, Sir Trevor | Mr. David Davis. |
| Smith, Tim (Beaconsfield) |
§ Question accordingly negatived.