HC Deb 18 May 1992 vol 208 cc8-10
9. Mr. French

To ask the Secretary of State for Transport it he has reached any conclusions on the future funding of British Rail.

Mr. MacGregor

British Rail and the Government will be discussing BR's funding for the next three years as part of this year's public expenditure discussions. Current levels of investment in BR are the highest for 30 years.

Mr. French

I am grateful to my right hon. Friend for that reply. Can he specify how substantial BR's investment programme has been in the past five years? Can he give us an estimate of how much it needs to be in the next five years in order to maintain and improve rail services to the standard and quality required by the public?

Mr. MacGregor

I shall certainly say something about that later this afternoon. I cannot, of course, comment on the next five years, because, as I said, such funding will be included in the discussions that I will have in the summer and will be part of the public expenditure survey. My hon. Friend is absolutely right about the past five years, when more than £4 billion in real terms was invested. That money represents capital investment alone and leaves aside other public sector funding for BR.

Mr. Bennett

Can the Secretary of State confirm that unless BR gets more money it will have to go in for more railway closures? Will he consider carefully the farcical procedures that are going on now in Greater Manchester where BR first reduced the frequency of trains on a particular line to one train in one direction per week and then went on to undertake the statutory closure procedures? Does not that make a nonsense of those procedures? Surely the inquiry should be held when BR starts to reduce the frequency of a service rather than when it cuts it to the bone.

Mr. MacGregor

I cannot comment on that particular case, because that is a matter for British Rail. However, the statutory procedures have been in operation for a long time and have operated well. Under the proposals that we shall put before the House for the privatisation of British Rail and the injection of more private sector involvement, those procedures will broadly remain intact.

Mr. Adley

My right hon. Friend is invited, in the question, to draw conclusions. What conclusions does he draw from the following proposition? The best railways in the world are probably those, in France, Germany, Italy and Switzerland, to name but four, that are in the public sector and the worst passenger railway in the world is probably in the United States—it was so bad that the American Government had to nationalise it.

Mr. MacGregor

I draw a variety of conclusions from that, but I shall tell my hon. Friend just two. First, other countries are looking at the proposals that we shall debate later today and later in the Session. Secondly, when one makes comparisons with France—I have been looking at this thoroughly—one of the questions that have to be asked is whether the taxpayer is getting a good deal from that massive investment, given the resulting huge debts that are incurred by the railway network in France. If the financial situation here were as it is there, many questions would need to be asked about whether we were getting value for money.

Mr. Prescott

I wish to offer my welcome to the Secretary of State. I hope that he stays in his new job a little longer than the previous seven Secretaries of State in the past 13 years have done.

Has the right hon. Gentleman read, among his early readings on railway finance, the British Rail report "The Next Decade"; if so, can he confirm that British Raill wants £1 billion of investment every year for the next 10 years? I refer him to today's Library report, which clearly shows that the British rail system is the least-funded, most under-invested railway system in Europe.

Mr. MacGregor

I thank the hon. Gentleman for his welcome, and I look forward to a number of encounters with him. I am not sure whether to say that I hope that he will be in the same post for many years ahead.

As to the hon. Gentleman's question, if he is referring to taxpayers' finance and public sector funding, I have already said that if one makes comparisons with other countries, one can draw many lessons other than simply that more money needs always to be pumped into the system by the taxpayer. As to investment, at this point I cannot comment on the next 10 years. At the appropriate time, I shall comment on the next three years. About £1 billion was invested for capital expenditure in 1991–92, and we expect £1.5 billion to be invested this year.

Mrs. Gorman

I congratulate the Government on the amount of money that they have undoubtedly put into the railway system, which includes many excellent long-distance services. However, will my right hon. Friend continue pursuing the possibility of using more private money, most particularly for the Fenchurch Street line —which services part of my constituency—to which the Government gave a generous £50 million grant just before the last recess and which is looking forward to the possibility of private capital taking over and running that line?

Mr. MacGregor

I agree with my hon. Friend that that happened just before the last recess, and we have seen continuity of policy since then. I would not wish to comment this afternoon on a particular line in the context of private sector finance, but my hon. Friend made a general point about private sector finance and I therefore assume that she will be an enthusiastic supporter of the proposals that we discuss this afternoon.