HC Deb 29 March 1995 vol 257 cc980-6

1 pm

Mrs. Audrey Wise (Preston)

The west coast main line is Britain's busiest railway. It serves a population of 16 million, in 16 counties or regions. More than 2,000 trains a day pass over its tracks. It is therefore of immense social and economic importance, yet it has been grossly neglected in the past 15 years.

It was originally built in the 1830s and 1840s, and it was the first inter-city railway in the world. In the first half of the century, some parts of the line were widened to four tracks, and the line was electrified between 1955 and 1975, but we are now in 1995, and virtually nothing has changed in the past 20 years.

The rolling stock is not of a modern standard. For some years, we who travel on the west coast main line have thought enviously of the east coast main line. We especially think about that when we listen to the all too frequent announcements about the breakdown of the locomotive pulling the train in front of ours, and about the fact that overhead lines are down in the Rugby area. That gives us quite a few opportunities to think enviously of the east coast line.

Our hopes were raised a year or so ago, but, with the exercise of their remarkable logic, the Government decided that the west coast main line should be put into competition with the equally necessary Networker trains for the south-east. For reasons that we can only guess at, the south-east was declared the winner.

In November 1994, the then new Secretary of State for Transport published a glossy brochure called Building Tomorrows Transport Network, which mentioned the west coast main line. It said: The intention is to launch a competition in early 1995 for the design and build, and to let a contract in mid-1995, for work to start as soon as possible after that. In the summary published on 22 March, we at last had some firm recommendations, but, in the past four months, the time scale for starting any work has slipped at least a year. Page 55 talks about the award of contracts for the implementation of the modernisation of the west coast main line in 1996. We are being offered some, but by no means all, of what is needed. The recommendation is for what is called a core investment programme. That programme is essentially for an advanced train control and signalling system, combined with track renewal to maintain, or possibly to improve, its condition, and some enhancement of power supply, giving improved capacity, safety and reliability. It is therefore to be welcomed, but it is not sufficient. Further changes should be made. They have been identified, but they are to be regarded as optional add-ons, which may or may not happen.

The feasibility study includes the recommended core investment programme and a range of other things, which are displayed, as it were, in a shop window, to be picked up or not by franchisees. One is new advanced rolling stock—trains—which is crucial for passengers.

Another is the capacity to piggy-back freight containers—to take standard size road trailers and lift them on to modified wagons on the railway. That provides the opportunity for a truly integrated freight transport system, giving the advantages of the road when its use is essential, but allowing full use of the railway for the larger part of journeys, with the massive environmental gains and great benefit to road users that that brings.

The published feasibility study gives little weight to the economic impact of full-scale modernisation of the west coast main line. It devotes little more than a page to it. In contrast, local authorities such as my own in Lancashire are well seized of the lines economic importance both directly, in transport terms, and in terms of jobs generated in undertaking the work.

One of the major worries of all of us who want a thoroughly upgraded service involves the question, Where will the money come from? The Government appear to have washed their hands of real responsibility in the matter. Railtrack says that it can find the £1 billion needed for the core investment programme between 1996 and 2004. That is a long time scale. I appreciate the technical and logistical constraints, but will the Minister assure me that financial constraints will not be allowed to lengthen the work further, and that that is the shortest time scale that is technically possible? Is it already influenced by cash constraints?

One of the Governments initial papers on privatising the rail network, called New Opportunities for the Railways, stated in paragraph 43 that the Government are ready to provide direct support for investment in the railway, for schemes which, although not earning an adequate financial return, provide a satisfactory cost-benefit return when wider benefits are taken into account. The channel tunnel main line project will benefit from capitalised payments of £1 billion in recognition of the benefits arising from its handling of Kent commuter traffic, so clearly the Government are putting some flesh on their promise in New Opportunities for the Railways. That was a belated, but welcome, recognition on the Governments part that the public sector should contribute to the provision of either new or upgraded railways. Will the Minister, in the same spirit, please explain how he proposes to ensure that an appropriate contribution is made to the west coast main line?

Railtrack is implicitly treated as though it were already privatised. Further fragmentation will take place when the franchises come into being. The Government are effectively washing their hands of their financial responsibility. Talking of finance prompts me to hope that increased fares will not be extracted from passengers who are now paying high fares for what is often a substandard service.

In any case, however, complex arrangements must be made to give Railtrack extra resources via the franchisees, assuming that more revenue is generated not from higher charges but from increased usage. In the feasibility study, Railtrack points out that those resources must, somehow, be conveyed from the franchisees, who will be the immediate beneficiaries, to Railtrack, which will bear a great deal of the cost. The Government are fragmenting the railway system, and the fragments will have to find complicated ways to recombine, which serves merely to illustrate the fact that the railway service should be unified. We have all heard the comments made in the past few days by Sir Bob Reid, who can claim some expertise in these matters.

One of the problems is that the Government are not giving sufficient weight to the economic importance of the west coast main line or to the beneficial environmental impact of attracting more passengers and freight on to the railways. When those factors are taken into account and given due weight, it becomes clear that there needs to be public sector involvement. It is all very well to involve private sector finance—we are not in any way opposed to that—but if we depend on it entirely, we shall run into trouble and experience further delays.

Some of the leases on the current rolling stock do not finish until the year 2002. There is no guarantee that the new franchisees will be willing to accept the financial burden necessary to provide us with advanced trains. What is the Governments answer to these problems? So far, I have detected only a pretty deafening silence, which is not satisfactory. I hope that the Minister will answer my specific questions.

Are the Government committed to a piggy-back service to facilitate upgraded freight transport? If they are not, the Minister will have to explain to the nation why the Government are so careless of the environmental damage done to the planet as a whole, and to the roads in particular, by the excessive carriage of freight on the roads, especially when it could very conveniently be carried by rail if the west coast main line were improved.

What is the Minister going to do about injecting public sector finance into the railways as an acknowledgement of the important economic and environmental impact of a proper upgrading? What will he do to prevent the fragments from causing complete financial and technical chaos on the west coast main line? There are 16 million people in 16 regions along the line, which passes through many marginal seats, something that it is perhaps worth mentioning at this stage in the parliamentary cycle. What has the Minister to say to reassure all of us?

1.12 pm
Mr. Henry McLeish (Fife, Central)

I endorse the comments made by my hon. Friend the Member for Preston (Mrs. Wise) about this important project. I wish to register the Labour party's concern about the fact that the Government are dragging their feet on a vital investment project for the next century.

Let us set the west coast main line in context. No one should doubt that it is an essential part of the national rail network, but it is also critical for regional development. It is an arterial spine of the railway system, and it must be renewed and refurbished. The next century is only five years away, but the refurbishment has not yet been started.

The line is also a vital link to Europe. In Committee earlier today, some of us were discussing the interoperability of trains in Europe. It is hoped that improvement of the west coast main line will not only improve services in Britain but provide a vital link to London through the tunnel and into Europe.

The line is also important as a symbol of what needs to be done in this country. We need to invest, to make the economy a priority and to ensure that passenger services are as good as they can be. For those reasons, the Minister must show some urgency in replying to my hon. Friend the Member for Preston.

I fear that the west coast main line project faces real problems, two of which are the lack of a real and effective timetable and the lack of effective funding. Much has been said about the private sector—we want to encourage private finance in all sectors of the economy—but, to coin a phrase, Wheres the beef? How long do we have to wait before we see the colour of the money? How long before we have a timetable showing the start of this vital project?

In addition to those considerations, privatisation is creating uncertainty. It has been a shambles. Uncertainty has made the private sector sceptical and suspicious of a Government who have apparently taken leave of their senses and who appear to lack commitment and enthusiasm for such an important project. The dumping of privatisation would allow the nation to return to the key issues of investment, jobs and passenger services instead of focusing on the nonsense indulged in day after day.

As my hon. Friend asked, where is the cash to come from? Will the scheme mean a dramatic rise in fares for those who use the refurbished parts of the route under the jurisdiction of Railtrack? Have the technical problems been solved?

We want to spend £1 billion on a much-needed refurbishment project, but we also want to franchise the west coast main line at the same time, and Railtrack is dividing the zone covering the line into two. I can hardly think of words to describe that, apart from crazy or mad. The net effect will be to delay the project even longer, to the disadvantage of the various constituencies that my hon. Friend mentioned. That cannot continue.

The nation needs to consider urgently the future of the rail network. Let the Minister say that he is pursuing the matter vigorously. I have little faith that Railtrack will deliver on this project. The chairman is far too involved in privatisation and flotation of Railtrack itself. How on earth can his mind be properly focused on the issues facing people using the west coast main line when there are so many distractions?

Railtrack has to exhibit the expertise and enthusiasm to get the project under way, but today we look to the Minister to reassure us that he shares our sense of urgency, and that he will tell Railtrack that now is the time to move the project on so that we can reap the benefits. Then, instead of regarding privatisation as the main issue, we can make investment in the future of Britain and the future of the west coast main line our priority.

1.16 pm
The Minister for Railways and Roads (Mr. John Watts)

I thank the hon. Member for Preston (Mrs. Wise) for providing the House with an opportunity to discuss the west coast main line modernisation project, and congratulate her on her timing.

Last week, we saw what I regard as some exciting developments for the scheme, and I am glad to have an opportunity to review them before the whole House, as I did with the all-party group last week. The hon. Lady gave us the history of the line and, at one point, I thought that we might have had the same speech writer as our words were identical. In any event, I shall not repeat them.

The hon. Lady emphasised the importance of the route, which runs from London to Birmingham, Manchester, Liverpool and Glasgow, with a further connection to Edinburgh, and the fact that it crosses 16 regions with some 16 million inhabitants. Its annual traffic is around 3 billion miles of passenger journeys, and 5.5 billion tonnes km of freight. Unfortunately, I have to use kilometres when dealing with statistics, contrary to my preferences.

The electrification of the line was completed 20 years ago, which is one reason that an upgrade is now timely, and that my right hon. Friend the Member for Norfolk, South (Mr. MacGregor), the former Secretary of State, for Transport, announced in December 1993 that the modernisation of the west coast main line would be a flagship project for the private finance initiative.

In March last year, after keen competition, Railtrack let the contract for the first phase of the project. The key tasks set for that stage of the scheme were to assess the technical options for the modernisation of the line and to make recommendations on the appropriate funding and contracting strategy for the main modernisation project.

The successful consortium was the West Coast Main Line development company, a diverse group of private sector companies. The feasibility study was completed on time.

Mr. Eric Martlew (Carlisle)

When the Minister originally announced the scheme, he said that it was to be funded by £600 million of private sector money. Will he tell us why that figure has become £1 billion, and whether it will be a mixture of private and public money?

Mr. Watts

Clearly, as the examination of the feasibility has progressed, the estimated costings have been more clearly defined and we have moved to a different cost base. There is scope for a mixture of public and private funding. The hon. Gentleman knows that we have secured the inclusion of this important project in the Christophersen group of projects of Community significance, which may be one of the sources of available funding.

As I was saying, the feasibility study was completed on time just before Christmas and delivered to the Government. The development company recommended a comprehensive modernisation of the infrastructure of the whole line, involving major work over a number of years on track, power supply and structures. The work which the consortium has carried out on the lines essential assets is important and thorough. However, the most inspirational element of its report, as well as that which will be the most complex and time-consuming to deliver, is the proposed new signalling and control system.

Railtrack and the consortium carried out a very careful assessment of existing signalling technologies, and reached the conclusion that none of them represented the way forward for the west coast main line. Instead, the consortium recommended the development of a new generation of transmission-based cab signalling and the construction of a single, integrated control centre.

Mr. Bill Olner (Nuneaton)

Will the Minister confirm that this cab control system, which he spoke about at the meeting of the all-party west coast main line group, to which he referred, has not been proven to work for passenger traffic? It has only been proven to work in north America, where trains are separated by anything up to three or four hours, and it has never been contemplated for use on a line so busy as the west coast main line.

Mr. Watts

I do not claim any great technical expertise, but my advice is that the equipment required is already in existence. What will be new is configuring it into a system to meet the needs of the west coast main line.

It is not entirely new territory. I am told that it is very similar to the control system used in the channel tunnel, for example, and it is also very much in line with the proposed technical standards for the European train control system, which is also being developed. While I would not pretend that the system is not breaking some new frontiers, I do not believe that it is beyond the ability of our industry to develop a suitable system, and it is not so ground-breaking that there are any serious doubts that it can be delivered.

Mr. Peter L. Pike (Burnley)

Is it not also important to recognise not only that the line has to be exclusively equipped for the new Intercity routes on the west coast main line, but that signalling will be made difficult because, on certain stretches, it will still have to be able to cope with local services?

Mr. Watts

In considering how it would be implemented, Railtrack is planning a period when there will be dual signalling techniques on the line, so that services crossing the line, which would not necessarily have the new technology, will continue to be able to operate safely. Clearly it is important that, during a major upgrade on a line which carries 2,000 trains, provisions must be made for the line to continue to operate. We cannot just close it down while work is carried out.

Indeed, one of the benefits of new technology signalling is that it is not a matter of ripping up cables and trackside signals and replacing them. The existing cables and signals can stay in place and continue operating while the cab-based system is implemented. The two will not interfere with each other.

I was very pleased last week to be able to announce that the Government have given their approval to Railtrack moving ahead as quickly as possible to award a contract to develop the system. The contract will be structured to transfer to the private sector real responsibilities associated with the delivery and performance of the technology and the financial risk associated with those responsibilities. I expect Railtrack to let that contract later this year.

With regard to timing, I would say to the hon. Member for Fife, Central (Mr. McLeish) that I certainly do not wish to see any dragging of feet, and nor do the Government. We look upon it as a very important project, for all the reasons that he and the hon. Member for Preston have mentioned. There is no incentive for Railtrack to go slow either, because it looks on the project as an important commercial opportunity, and it is very much in its own commercial interests to be able to offer a better service to its customers who operate passenger and freight trains on the line. There is every incentive for all the parties involved to make progress as rapidly as possible.

The key importance of the new technology is that it substantially reduces maintenance costs. From the savings which arise from ceasing to maintain an outdated technology, much of the funding for the core investment programme will be released.

As well as the core programme, the study produced by the development company also assessed a range of possible service enhancements. For passenger services, they include the possibility of higher speeds on the line, leading to substantial reductions in journey times. For freight services, the report assessed a range of enhancements, including the increased clearances which would be needed to allow piggy-back traffic. Those enhancements will be offered by Railtrack to its customers and prospective customers on a commercial basis. I am due to have a further meeting with Lord Berkeley of the piggy-back consortium in the next few weeks, so that he may update me on the development of its ideas.

On the passenger side, though, the director of passenger rail franchising will have a pivotal role in the discussions and negotiations between Railtrack and the train operating companies. The franchising director has kept very closely in touch with the progress of the study, and I know that, over recent months, he and his staff at Opraf have been consulting widely with both rolling stock manufacturers and potential franchisees.

The hon. Member for Preston asked what the funding mechanism will be. The means by which money feeds into the railway for passenger services is of course through the franchising directors budget and the agreements that he enters into with train operators. In turn, those funds feed through to Railtrack through access charges.

The mode will be that Railtrack will have the responsibility of raising money to fund capital investment. Its remuneration, as for all its activities, will be through the track access charges paid by train operators.

Mrs. Wise

Since the rail regulator some time ago announced that Railtrack access charges should be 8 per cent. lower this year than last year, and that they should fall by 2 per cent. in real terms in each of the subsequent years, how can we be sure that such a squeeze on access charges will not interfere with the funding arrangements that the Minister is now outlining, and make it impossible to get the money through to Railtrack?

Mr. Watts

In reaching his judgments on the appropriate level of access charges, the regulator will also have considered his responsibility to oversee Railtracks investment programme to ensure that it continues to have the funds needed to invest in improvements, maintain the network and produce an adequate return. He has reached the conclusion that Railtrack has considerable scope for efficiency savings, and that some of those should be passed through to train operators rather than being merely for the benefit of the shareholders of Railtrack when it enters the private sector.

There is a mechanism in place for funding to flow through and provide support for the investment proposals. I think that the hon. Lady will understand that the project is different from the channel tunnel rail link, not because of the region that it serves but because that rail link is a totally private sector project with an initial capital contribution from the Government, partly in the form—

Mr. Deputy Speaker (Mr. Geoffrey Lofthouse)

Order. Time is up.