§ 8. Mr. GregoryTo ask the Secretary of State for Transport if he has any plans to meet the chairman of British Rail to discuss plans for denationalisation.
§ Mr. FreemanMy right hon. Friend will discuss privatisation, when appropriate at his regular meetings with the chairman of British Rail.
§ Mr. GregoryI thank my hon. Friend for that answer. Does he appreciate the frustration in great railway cities such as York which have seen the denationalisation of Sealink, Travellers Fare on-station catering, and British Rail Engineering Ltd., but not of the core business of British Rail? Would not it be more productive and better for those who actually use rail services if he were to call for denationalisation plans? That could be an opportunity for those who work in that great industry to have a share in its success, which my hon. Friend is frustrating at present.
§ Mr. FreemanI agree with my hon. Friend that we need to achieve a better deal for the consumer—the passenger on British Rail. Therefore, the recent reorganisation plans that were announced by British Rail and which are based on the business sectors of British Rail—freight, international, InterCity, provincial and Network SouthEast—are to be welcomed because they focus 7 management's effort and attention on improving the service that is available to consumers. That reorganisation is not inconsistent with privatisation, but that is not a matter for this Parliament.
§ Mrs. DunwoodyWill the Minister explain to his hon. Friend the Member for York (Mr. Gregory) that the chairman of British Rail recently gave evidence to the Select Committee on Transport that, although the financial targets that had been set by the Government were being met, there was no question of the quality of service being met? That has a great deal more to do with the comfort of passengers than all the nonsense that is talked about trying to sell off an unprofitable business.
§ Mr. FreemanThere is no prospect in this Parliament of any proposals for denationalising British railways. I was not present to hear the evidence that was given by Sir Bob Reid, but I assure the hon. Lady that the financial target that was set by my right hon. Friend the Secretary of State for Transport and the quality targets are achievable by British Rail. I shall shortly be having a meeting with the chairman of British Rail and the chairman of London Regional Transport to monitor what progress has been made on those quality objectives and to work with those two undertakings to make sure that they are achieved.
§ Mr. Beaumont-DarkDoes my hon. Friend the Minister accept that if Japan, America, France and Germany find a need to subsidise railways as a public service, it cannot be a sound policy to keep on pushing up InterCity and commuter fares in the vain hope of selling off something which, if it is to be profitable, will leave us with three private lines? Will the Minister accept that railways are a necessary part of the infrastructure of this country and that spending £600 million on the A1 is not as important as spending £600 million on railways?
§ Mr. FreemanMy hon. Friend will be delighted to learn that, over the next three years, road investment in this country, paid for by the taxpayer, will be about £6 billion and investment in rail schemes by British Rail and London Regional Transport will also be £6 billion. A significant proportion of that railway investment will be paid by the public sector, either in subsidy for Network SouthEast or provincial railways, or by borrowing from the national loans fund. We have the proportion of investment in roads and railways right. If my hon. Friend looks at the experience of Germany and France, he will see that there are pressures there to reduce the losses and the subsidies that they are suffering and that they wish to emulate British Rail and the experience of this public sector.
§ Mr. PrescottAre the Minister and the Secretary of State aware of the conclusion of two recent reports by the European Commission and the chartered accountants' institute that British Rail is seriously disadvantaged in being prevented from raising private capital to finance a high-speed rail link, as in France and Germany, simply because of Treasury rules and the financial targets that have been imposed on British Rail by all Governments? Will he press for changes so that a publicly owned British Rail can raise private capital on its own to finance a new high-speed rail link this century rather than next century?
§ Mr. FreemanI must first correct the hon. Gentleman—the Institute of Chartered Accountants in England and Wales did not produce that report. The body that 8 produced the report is not part of the institute—I happen to know that because I belong to it. The Hundred Group of chartered accountants is not part of the profession.
§ Mr. FreemanYes, I did. I not only participated in the production of the 1981 report, but carefully read the 1989 update.
On the point about borrowing from the private sector for railway investment, of course, British Rail wants to use private sector finance. That was what the proposal that was put to us about the channel tunnel high-speed rail link was all about. The proposal did not work, because the balance was not right—[Interruption.] Well, I can advise the hon. Member for Kingston upon Hull, East (Mr. Prescott) that there is no shortage of capital in this country and no shortage of railway investment schemes in which people can invest. The problem is to find viable schemes that will ensure the repayment of that capital. The hon. Gentleman talks about raising £15 billion for a high-speed rail link—[HON. MEMBERS: "No."] Yes, £15 billion for a high-speed rail link from Folkestone to Scotland. However, the hon. Gentleman will find that that scheme is not and will not be viable. He is assuming that money is available for projects that are not viable and where the money cannot be repaid.
§ Mr. SpeakerI understand that there is an agreement to take question No. 9 at the end. We therefore move to question No. 10.