HC Deb 17 May 1995 vol 260 cc342-93
Madam Speaker

Before we move on to rail services under privatisation, I should inform the House that I have selected the amendment standing in the name of the Prime Minister.

3.51 pm
Mr. Michael Meacher (Oldham, West)

I beg to move, That this House, noting that the threat of rail privatisation is leading to a blight of investment, lowered reliability and punctuality of services, and higher public subsidies to private operators, calls on the Government to improve and increase investment in a publicly owned and publicly accountable rail system which best serves the public interest and the needs of the British economy. Since 1992, when the Government introduced their rail privatisation proposals, virtually every index of rail performance has shown a sharp decline. The most dramatic and damaging in its long-term effects is the fall in investment. According to the Government's own figures, in 1992, investment in the existing rail network, excluding the channel tunnel, stood at £1,060 million at today's prices. This year, it is expected to be about £490 million. That is a staggering cut of 54 per cent. in three years.

The meaning of the halving of rail investment to below £500 million in the present year is revealed by the fact that Sir Bob Reid, the former chairman of British Rail, recently said: To keep the railway in a good steady state we need to be spending in the region of £900 million to £1 billion a year. To fall below that bottom line for several years running is an obvious false economy. To halve the amount is surely irresponsible and dangerous.

The consequence has been a decline on the railways that is unprecedented for 50 years. Last year, for the first time since the war, there were no orders for new rolling stock. That seems bound to continue this year because of the uncertainties over privatisation. No new signalling or electrification projects were ordered in the two years to April 1994 and Railtrack has placed only one significant contract since being set up that month.

The value of rolling stock orders completed has plummeted by half in the past two years, while signalling turnover has fallen by one third.

Mr. Patrick McLoughlin (West Derbyshire)

Will the hon. Gentleman give way?

Mr. Meacher

I shall give way in a moment, but I want to make one or two points first.

Routine track renewal of £200 million a year is necessary to maintain its condition, yet track renewal has now slowed to such an extent that engineers must assume that rails have a working life of 90 years, which is far beyond what is either realistic or safe. Thank God there has been no really serious accident yet. But I believe that that is much more by luck than by judgment.

Mr. McLoughlin

A few minutes ago the hon. Gentleman quoted Sir Bob Reid's estimate of £900 million. Is he saying that if he was Secretary of State for Transport, he would always do what the chairman of a nationalised industry requested? Is he now committing himself to spending an extra £400 million or £500 million a year on the railways?

Mr. Meacher

That is a rather silly point. It is not a matter of doing what the chairman of British Rail says; it is a matter of doing what is sensible. Any reasonable Government would listen to what a chairman of British Rail, whom they appointed, said. To produce an investment record scarcely better than half of what he believes to be the minimum necessary simply to maintain a good steady state is an utter condemnation of the Government's rail investment policy, in which I hope the hon. Gentleman will join.

Dr. Robert Spink (Castle Point)

Will the hon. Gentleman give way?

Mr. Meacher

No, I want to make a little progress.

Altogether, it has been estimated that British Rail now has more than 2,500 carriages and locomotives that need replacing in the near future. Yet no orders are being placed. In the Kent Coast fleet, 475 carriages are more than 40 years old—as the long-suffering Kent commuters know only too well—well beyond their maximum working life. Yet the Government prefer to allow ABB at York to go into liquidation at a cost of 750 jobs rather than bring forward even a limited follow-on order. That is the state of Britain's railways today under this policy.

The result of all that has been that service quality has gone through the floor. In the past year alone, 20,000 trains were cancelled—that is more than 80 a day on average. Overcrowding on commuter lines in the south-east is now so acute that the number of standing passengers on slam-door trains is up to three times the number recommended by the Hidden committee after the Clapham train disaster.

In the past year since British Rail was reorganised for privatisation, delays have soared. Of 102 train service groups covering punctuality and reliability, in the past year two thirds did worse than in the previous year. I shall not detain the House by going into more detail, but those examples are typical of the drift, muddle, make-do and breakdown that is now occurring across the rail network.

It is not as if the Secretary of State has not had personal experience of that himself. I understand that last month he went by train to Leeds, and I take up the story as it was lovingly recorded in one of the newspapers. Chuff chuff chuff, until just outside Leeds, when the train stopped with a groan. Points problems, the customers were told. Dr. Mawhinney got out at Leeds, where he cut short the greetings from assorted local management with a sharpish demand to know what had happened to the points and how long there had been problems. The senior British Rail man dropped his kid gloves too: 'It's because of lack of investment, Minister.'

Mr. Gyles Brandreth (City of Chester)

Will the hon. Gentleman give way on that very point?

Mr. Meacher

I shall be very surprised if it is on that very point, but let us see.

Mr. Brandreth

It is on that very point. Obviously, the hon. Gentleman is painting something of a caricature. It certainly does not reflect the line between London and Chester. The hon. Gentleman is a good 10 minutes into his speech, painting a dismal picture, but he has said nothing about the level of investment that he would settle on or whether he has plans to renationalise. Will he give us some answers as well as telling us how terrible it all appears from his perspective? What are his specific solutions? What should the level of investment be? What are the plans for renationalisation?

Mr. Meacher

I well understand the hon. Gentleman's anxiety to leave the subject of the debate. I remind him that the debate is about the further erosion of rail services due to privatisation. That is what we are debating, and that is exactly what I have described.

If the hon. Gentleman wishes to know the Labour party's policy, I shall say something about that before I conclude. However, I can put him out of his misery by saying three things. First, we would substantially increase investment in rail to make up for the huge decline in investment that has taken place for years under the policy of Conservative Governments. Secondly, we believe that rail has a very significant role to play in an overall transport policy. Thirdly, we do not have the visceral hostility to the public sector that emerges from every speech that the Secretary of State and his hon. Friends make.

Mr. Gary Streeter (Plymouth, Sutton)

Will the hon. Gentleman gave way?

Mr. Meacher

No, I will not.

Mr. James Clappison (Hertsmere)

Will the hon. Gentleman give way?

Mr. Meacher

No, I will not. I want to make a few more arguments in my own speech.

Perhaps the best illustration of the great Mawhinney railway revolution is that it appears that damaged trains are now taken for repair by road. ScotRail, for example, found that it would cost £20,000 to £30,000 per train to take two flood-damaged trains from Glasgow to ABB's Derby workshops by lorry, but that renting a special towing locomotive and paying Railtrack's extra charges for using lines between the Scottish border and the midlands would be as much as 20 per cent. more expensive. I hardly need tell the House that, under the old British Rail network, the cost of moving trains by rail would have been absorbed; it would have been at marginal cost in the system.

When I read that in The Daily Telegraph—which of course the Secretary of State was reading on his way to Leeds—I congratulated him on giving a new twist to the privatisation saga. None of us had realised that he meant that, under his privatisation proposals, trains would in future travel by private lorry. Things have descended to that farcical level because the privatisation process is pitted with tensions and inconsistencies that cannot be resolved, and there is no leadership from the centre to stop the rot.

The Secretary of State excels as the weather vane Secretary of State; the invisible man of policy. He is the general who has been put in to sound the retreat—not to create a transport policy, but to withdraw from every trace of it. He is the man who has abandoned the M25 widening, who has dropped motorway tolling and who has rejected congestion pricing, but who has produced nothing recognisable as a roads policy. He is the man who kicked into touch the runway capacity in the south-east report on airport development and who put off action on ferry safety until the next decade.

The Secretary of State is the man who dropped the reduction in through-ticketing stations like a hot brick when the political row became too great for him. He is the man who was prepared to sell ABB down the river and withdraw from Ministers' repeated commitments to a £500 million modernisation programme for the Kent Coast rail fleet. He is the man who scuppered his predecessors' promises to bring in automatic train protection.

The Secretary of State is the man who, after the then Minister of State, the right hon. Member for Kettering (Mr. Freeman), said in January 1993: There must be no hiatus in railway investment during a transition to a franchised railway", has presided over the deepest and longest investment blight in modern railway history. There was no problem about getting rid of all the embarrassing baggage of Tory transport policy; there was just a vacuum where policy should be.

Mr. Streeter

Will the hon. Gentleman give way?

Mr. Meacher

I take it that it is about the arguments that I have made.

Mr. Streeter

Yes. I am grateful to the hon. Gentleman for giving way. He has now met his sound bite quota for the day in full, but the House really wants to know, would the Labour party renationalise British Rail—yes or no?

Mr. Henry McLeish (Fife, Central)

The Government have not privatised anything yet.

Mr. Meacher

As my hon. Friend says, the first question, which is an interesting one, is whether the Government will succeed in privatising anything. Apart from a ballast quarry in Devon or somewhere, I do not think that they have succeeded in privatising anything so far. For reasons that I shall give later, I would be surprised if they succeeded in privatising more than a small part of the system. If and when they do so, we shall make it clear how we shall deal with it and how we shall return to a publicly owned and accountable rail system.

In all this anxiety to scuttle, the alleged goals of privatisation have all been stampeded under foot. The Secretary of State has often proclaimed that one of the objectives is to reduce public subsidies to the rail system.

The Secretary of State for Transport (Dr. Brian Mawhinney)

That is not true.

Mr. Meacher

I am sure that the right hon. Gentleman is on record as saying that one of the results will be that subsidies will be reduced and that the system will be more dependent on the market. It is now clear, however, that public subsidies will be massively increased. Not only has the public service grant been nearly doubled to £1.7 billion a year to pay for track access charges to Railtrack—money that is intended, as public subsidy, to go eventually to Railtrack shareholders—but a public subsidy of at least £330 million to £500 million a year will have to be paid to private train operators to compensate them for their loss of revenue under the cap and to pay for their profits.

It is becoming clear that, far from the market operating unfettered, privatisation will mean a huge enlargement of public subsidies to private operators in the biggest market-rigging operation in modern rail history. Even that is without the £1.4 billion write-off of Railtrack debts as a sweetener for investors, as has happened with every other privatisation before this one.

Dr. Mawhinney

The hon. Gentleman has quoted a number of figures this week. He started out on Monday with £1 billion. He seems to have moved a little since then. For our better understanding, will he explain how he calculated those figures?

Mr. Meacher

Perhaps I could do a deal with the Secretary of State. If he will tell me what his figures are, I shall be pleased to tell him how we reach our figures. If that is a deal, let me start by saying that we calculated them on a clear basis. In the past, I think, 10 years, under Government edict revenue to British Rail has increased every year by a figure of between 2 and 3 per cent. above inflation. Train operators will lose that revenue under the rail fares cap. In addition, if they are going to buy those investments, they will expect what perhaps I could delicately call a decent profit. I suspect that the going rate in the City is about 10 to 15 per cent. If one calculates both those figures on the basis of fares revenue across the rail network, there will be a need for a subsidy of between at least £330 million and up to £500 million. Those are tight figures, so there may be a need for more to finance the franchisees if they are to make a bid.

Now that I have clearly told the Secretary of State how we reached those figures—I shall be pleased to set them out mathematically for him if he wishes—perhaps he can now tell us what his figure is for the extra public subsidy that will be required as a result of his policy, announced on Monday, for a rail fares cap. I would be pleased to give way to him. He asked me what my figures were and how they were calculated. I have told him. Perhaps he can now tell the House what his figures are. [Hon. Members: "Come on."] The right hon. Gentleman is remarkably coy. In the past two or three days, I have listened to him around the circuit and this is the first time that he seems to be frightened to jump to his feet. I am doing my best to help him. I shall give him another chance. Does he think that the amount will be more or less than £500 million a year? Will he tell us just that?

I am not sure whether the right hon. Gentleman is glued to his seat, but he seems to be thinking very deeply. The Department of Transport did not have a figure when the policy was announced on Monday and it seems clear from the uncharacteristic silence of the Secretary of State that it still does not have a figure. It seems remarkable that he can announce a policy without having a figure.

We know that the Government were in enormous confusion about the policy because it was due to be announced on Friday. The Secretary of State wanted to exclude supersavers and Apex tickets, but the Prime Minister wanted them all to be included. That is why there was a delay until Monday. It still seems that there is no certainty about what the policy will cost.

I am offering the Secretary of State one last chance to come clean. If I am wrong about how this political hotch-potch was achieved, perhaps he will put me right. His silence is significant.

Mr. Peter Snape (West Bromwich, East)

To be fair, perhaps my hon. Friend is addressing that question to the wrong person. The intellectual justification for the rail privatisation exercise is being driven by the Secretary of State's parliamentary private secretary, the hon. Member for Hayes and Harlington (Mr. Dicks), who is sitting behind him.

Mr. Meacher

If the Secretary of State is the ventriloquist's dummy, it explains his silence.

The Secretary of State's second claim is that, even if the passenger service requirements are 20 to 30 per cent. below the level of current timetables, commercial operators will have a strong incentive to improve on the cutbacks. That is the line that he has taken regularly. It is no wonder that he has been tipped as the next Tory party chairman if, as we saw yesterday, he is prepared to allow major cuts on the London to Peterborough line on the basis of that arrangement. I admire either his folly or his courage—I am not sure which.

The truth is that private operators will have neither the incentive nor the resources to improve on the passenger service requirements allowed them because the fares cap will squeeze their revenues and, as we learnt today, because franchise holders will have to put up 15 per cent. of their expected turnover as a guarantee against financial failure. That will tie up a further £500 million across the network.

Perhaps the best comment on the Secretary of State's fantasy comes from James Sherwood, who has expressed a specific interest in purchasing the franchise for South West Trains. He said: There will be no incentive for the franchisee to invest or maintain standards. His only incentive will be to provide the minimum service which the Franchising Director will tolerate and thus squeeze every penny of profit out of a deteriorating asset base. That is not a comment from the Labour party spokesman. James Sherwood is a hard-nosed operator if ever there was one and it shows what idle fantasy the Secretary of State has been talking.

The Secretary of State's third claim, which he has repeated endlessly in the media in the past couple of days, is that fewer subsidies will be needed because if fares are lowered, more people will travel on the trains. That is wrong on two counts. First, as the Secretary of State must surely know—he must at least have been briefed—the elasticities simply do not work like that. If one knocks a pound off the fare, one gets back only about 60p in the increased number of passengers attracted. The retail prices index minus 1 per cent. formula will lose revenue, not raise it.

Secondly, the right hon. Gentleman has been saying that there is more than enough subsidy in the system already because the Government have substantially increased the public service grant to about £1.7 billion a year. The Secretary of State has not told us that a third of that—about £600 million—has to be repaid each year under the Treasury rules by British Rail and Railtrack as an external financing limit contribution to the Treasury. The remaining £1.1 billion is more than taken up with having to meet track access charges and train-leasing costs, as well as the reimbursement for social lines being kept open. So there is not enough subsidy in the system already. Indeed, more—I would say a great deal more—will be needed.

The right hon. Gentleman's fourth claim is that, even if the passenger service requirements are lower than the present timetable—and they are by an average of 20 per cent. to 30 per cent., but by up to 50 per cent. on some lines—at least that lower level of service is guaranteed. In an earlier debate, I remember the right hon. Gentleman straying from the main point by reiterating that that guarantee was an innovation, but it is not true.

The Office of Passenger Rail Franchising document entitled "Passenger Service Requirements: An Explanatory Note" states: If, at any point in future, the Franchising Director's budget were to be reduced to a level which was not sufficient to meet the support commitments contained within Franchise Agreements, then the Franchising Director would need to use this changed procedure to negotiate new passenger service requirements which reflected the reduced amount of money available to support them. In other words, far from being guaranteed, those services are distinctly tenuous because they are entirely dependent on the vagaries of Government budgeting. Indeed, there is no absolute guarantee that there will be a train service at all.

My final quotation comes from Sir Bob Reid, the former chairman of British Rail. In a recent interview he said: It would be quite possible for the franchise director to ensure that if an operator wanted to close a line, it would have to run buses instead. That is a pretty interesting observation. It may, I suppose, be incorrect and I should be glad if the Secretary of State could give an assurance that, if a line was closed, the franchising director could not turn it over to a bus service. Most of us had previously considered such a notion impossible.

The problem is not only the somewhat mystical nature—if I can politely call it that—of the right hon. Gentleman's claims or even the way he makes them, but the manner in which he clings to ideas and statements that he knows to be untrue. The whole idea of rail privatisation is now so universally detested across the country that the only way he could think of to give it a facelift was to link it to a cap on fares. However, he knows that the fares cap has nothing whatever to do with the logic of privatisation and everything to do with trying to buy cheap popularity for a failing cause.

The Secretary of State knows perfectly well that it was the Government's policy to allow rail fares to rise by 22 per cent. above inflation in the past 10 years. Indeed, the hypocrisy of the right hon. Gentleman now trying to claim that he believes in low fares is revealed by the way in which the Government moved heaven and earth to break the Greater London council's "Fares Fair" policy, which was based on exactly that principle and by the way in which they destroyed the South Yorkshire passenger transport executive's cheap fare policy in the same period, even threatening the withdrawal of the £8 million transport supplementary grant to force it to give up the subsidy. Only this Secretary of State and his accomplice, the Prime Minister, would have the brass neck to appropriate as a sweetener a subsidy regime that they have spent the past 10 years contemptuously and vigorously repudiating.

Finally, it is touching, even if also rather pathetic, that the right hon. Gentleman continues to cling to the notion that he will privatise 51 per cent. of the train-operating companies and Railtrack by April next year. It is now clear beyond doubt that he cannot and will not, and that the flagship target of rail privatisation is doomed. I say that for the following reasons. Final bids for the first three lines, accounting for some 20 per cent. of turnover, will not be in until the autumn and even an accelerated assessment period will certainly take until January or February next year at the earliest. Bids for the next four lines, accounting for another 25 per cent., will be at least two months behind. That is the quickest that it could be done. The right hon. Gentleman cannot pass the 51 per cent. target within that time limit, and all hope of doing so—I have to tell him and he must know himself—has disappeared.

Earlier talk by the Secretary of State of letting a contract for design and build in mid-1995 for the west coast main line has now vanished and Railtrack has shifted its interest into a new signalling and train control centre instead. Who will really want to buy into Railtrack if at least a majority of private train operators are not in place? It will be extremely difficult to achieve the flotation of Railtrack by that date. Indeed, I believe that it is clear that it is now impossible.

Mr. Eric Martlew (Carlisle)

With regard to the west coast main line, is my hon. Friend aware that yesterday the Office of Passenger Rail Franchising released statistics on the subsidies to be given to sleeper services? I understand that the situation concerning Fort William is sub judice, so I shall not comment on it. The subsidy for Edinburgh is £79 per passenger, for Aberdeen it is £69 and for Inverness it is £140. I agree with those subsidies and I am pleased that those services will continue. But the subsidy for Carlisle is only £38. Is it right that ScotRail has been vindictively—

Mr. Deputy Speaker (Mr. Geoffrey Lofthouse)

Order. The hon. Member knows full well that interventions have to be brief and to the point. That was a mini-speech.

Mr. Meacher

My hon. Friend makes a very clear point, which the Secretary of State should consider. I hope that either the right hon. Gentleman or the Minister who makes the winding-up speech will answer that question seriously. We are very concerned, not only about the impact of the decision in the Scottish courts, but because a number of other sleeper services, which we are determined should continue, have been allocated lower rates of subsidy.

With the collapse of the April 1996 deadline, the privatisation project is in very deep trouble. Despite bribes to senior management, there is almost nobody who now believes that privatisation is either desirable or practicable. Already 88 per cent. of the electorate are against it, which leaves even a majority of Conservatives opposed to it and only, I suppose, hard-core Thatcherites still in favour. The Secretary of State—I give him credit for this—has had the courage to drop every other millstone of the Government's transport policy. It is now time that he drops this one.

4.22 pm
The Secretary of State for Transport (Dr. Brian Mawhinney)

I beg to move, to leave out from "House" to the end of the Question and to add instead thereof: applauds the record levels of investment in the railways in recent years, including more than £6 billion over the last five years; notes that since nationalisation, despite investment of more than £54 billion in the railways, the proportion of travel undertaken by train has steadily decreased; believes that the railways will be better placed to offer an improved service in the private sector; welcomes recent announcements by the Franchising Director, which represent significant milestones on the path to a privatised railway; supports the new rail fares regime, which will see ticket prices regulated on every line in the country and will produce real fare reductions; believes that the Franchising Director's announcement struck a proper balance between the interests of the passenger and train operators; and condemns the continued failure of Her Majesty's Opposition to offer any policy to stem the relative decline in railway use.". I listened to the hon. Member for Oldham, West (Mr. Meacher) with interest. This is the third debate in our series and so far the Labour party is batting two-nil down. I must tell the hon. Gentleman that, having listened to his speech, the Labour party is going to be three-nil down.

The hon. Member for Oldham, West made a number of comments, accusations, allegations and predictions, so I must start by testing their credibility. It seemed that the best way to do so would be to examine his track record—if the House will forgive the expression—thus far. I looked back at our debate in January, when the hon. Gentleman had the following to say about through ticketing: The thrust of the document"— the regulator's document— is about eroding the number of through-ticketing stations and the only argument is about how far and how fast that can be achieved. The document is consultative in name only."—[Official Report, 18 January 1995; Vol. 252, c. 716–17.] I stood at the Dispatch Box and sought to persuade the hon. Gentleman that it was a consultation document. I told him that there were three options and I reaffirmed Ministers' commitment to through ticketing, but he would have none of it.

What happened? As of today, 1,300 stations will operate through ticketing. Why? Because the document was consultative and out of three options that was exactly what the public said they wanted. We heard a declaration—indeed, a declamation—from the hon. Gentleman that proved to be nonsense.

Let us see what the hon. Gentleman said about investment. In the second debate in our series, on 7 February, he said: I have repeatedly made it clear that we believe in increased investment in the rail infrastructure by comparison with that of the present Government."—[Official Report, 7 February 1995; Vol. 254, c. 203.] He said much the same today.

That made me wonder. It sounds terribly like a Labour party spending commitment, and we all know how hard it is to get one of those. I referred back to find out what Labour had spent in office to compare it with what we have spent, in order to determine what the hon. Member for Oldham, West was telling us in those elliptical terms. I discovered that, at constant prices, the Labour Government spent on average £926 million a year on British Rail. We have averaged just over £1 billion a year, so we now have the first firm Labour party spending commitment for the next general election. A Labour Government will invest a minimum of £80 million a year more—and they will not get away with that, because the hon. Gentleman's high-flown rhetoric will drive the figure up even further.

Sir Bob Reid said that we needed to spend £1 billion on the railways this year. The hon. Member for Oldham, West will be encouraged to know that this year's figure for investment in British Rail is £1 billion. He will also be interested to know that Sir Bob Reid and Bob Horton have said that the railways have enough money this year to run as they should. I hope that he is encouraged by that too.

Sir Russell Johnston (Inverness, Nairn and Lochaber)

Surely if we are talking about comparative investment figures, the basic comparison should be between what we have spent in this country and what has been spent in France and Germany. Between 1980 and 1989, Germany spent £14 billion and France £10 billion: this country spent £3 billion.

Dr. Mawhinney

If the hon. Gentleman does not like the Labour Front-Bench spokesman's argument, he must take that up with him. The hon. Member for Oldham, West compared investment in this country, so I responded to that. The House knows that, given the sniff of a vote anywhere, Liberal Democrats will promise another penny on income tax to try to meet the cost of the commitment, so I shall try to do some calculations for the hon. Gentleman and find out how much expenditure his intervention has committed the Liberal Democrat party to.

The third part of the credibility test for the hon. Member for Oldham, West concerns potential operators. He showed a touching concern for the private sector, which I welcome. In our debate on 18 January, he said: The fact is that there is such investor apathy about the sales that minimising the conditions that franchisees must meet … is a vital part of the exercise, and the interests of the passengers come absolutely nowhere".—[Official Report, 18 January 1995; Vol. 252, c. 722.] We have heard from potential bidders this week—people who have identified themselves as potential bidders, although for reasons of confidentiality I shall neither confirm nor deny the details. The hon. Member for Oldham, West will understand that. Talking of the fares announcement on Monday, Mr. Watt of British Bus said: It's still very early days, we're assessing the bids or assessing the information that the Government are providing, and this is simply another parameter that comes into the whole bidding process". James Sherwood said: I don't think they're sending any message at all to the franchisees, I think they're trying to comfort the general public who is worried that the privatisation process is going to result in fares increasing by more than inflation. So … this is not a problem for the franchisees. I assure you that fares will not go up in any event, even if there was no cap, by more than inflation". Ken Irvine, from Prism development, said: There are areas where we think we can make our profits through improved efficiency, through new ideas in terms of the operations, and improving the marketing and quality of service to the customer. A British Rail manager with an interest in a management buy-out said: It's fantastic at last to have a policy which will actually encourage more people on to trains at peak times. The House must decide whether it believes the hon. Member for Oldham, West—whose credibility decreases when we examine what he has said in previous debates—or those who have identified themselves as potential bidders. In my mind, there is no question but that the bidders know what they are talking about, and the hon. Gentleman can take that any way he wishes.

Mr. Meacher

If the right hon. Gentleman was so satisfied with the responses to his invitation to tender, why did he extend the pre-qualification registration period for the first three franchises by another month, and for the next five by another three months? Why was he so concerned during his recent visits to Japan for four days and to Korea for four days with trying to drum up interest in far eastern train operators buying into this country's rail system?

Dr. Mawhinney

I understand the hon. Gentleman's embarrassment, and the House sympathises with him. He is free-floating. One day he tells us that nobody will be interested in purchasing the franchises, but the next he is told that 37 companies have expressed an interest and that there have been more than 160 expressions of interest in the first eight franchises. He does not want this to succeed, and we all understand that, but a smidgen of intellectual rigour in his argument would impress the House a good deal more.

The hon. Member for Oldham, West issued a press release last Friday that was wisely ignored by the media. Let me give his press release a little airing on his behalf—I am always happy to help the hon. Gentleman. It said that I was to cap only standard fares and season tickets: wrong. He added "or all fares" just to be on the safe side: wrong. It continued: In fact it is a disaster … it makes the sale of most franchises difficult—if not impossible": wrong, as we have heard from four self-styled potential bidders. The fares announcement will mean cuts in investment": wrong. It went on: The Government's entire privatisation programme is now threatened": wrong. It is so threatened that today the invitations to tender for the first three franchises went out. My goodness, it feels like a very threatened privatisation.

To help the public deal with their confusion, the hon. Gentleman told "Today" on Monday that if we capped the revenue of operators and therefore their profits, frankly I think this is the last straw, so the Government will be forced to provide a huge subsidy paid for by the taxpayer". That is a large last straw. It is interesting—[Interruption.] Opposition Members must allow me to make my speech in my way, as my colleagues and I allowed the hon. Member for Oldham, West to make his speech in his way.

It is interesting that an arch advocate of what is gently referred to as "towards the left" of the Labour party suddenly wants to appear in the eyes of the great British public as being concerned about profits for private operators. A few weeks ago, the hon. Member for Oldham, West was saying that there were not going to be any profits. That was why there would be no bidders. It is a slide across credibility that defies analysis, much less acceptability. Or perhaps it is a reflection of the greatest economic miracle that this country has ever seen. For the Labour party to move, in the space of two or three weeks, from no profits to profits so high that it wants to cap them would make the mind of the Chancellor of the Exchequer boggle.

On subsidy—

Several hon. Members


Dr. Mawhinney

The hon. Member for Oldham, West has encouraged me to talk about subsidy, so I shall do so.

The first point to make about subsidy is that if the hon. Member for Oldham, West goes back to the White Paper, all the debates on the Bill and all the comments afterwards he will see that everyone recognised that there had to be a continuing subsidy from the taxpayer. As he has reminded me on other occasions, that is true of every railway in the world, and it is true of ours too. If we have no subsidies, we cannot protect services, particularly those on commercially non-viable lines that are deemed to be important. On that point, we have a degree of commonality. The railway was restructured so that there would be one point of entry for subsidy: the franchising director.

Let me explain again to the hon. Gentleman that, in essence, we are franchising against a criterion of information about what subsidy people will need to run various franchises. It is not possible, therefore, to predict, as we sit here today, the level of subsidy.

Mr. Meacher

Why not?

Dr. Mawhinney

I shall tell the hon. Gentleman why not. First, we have a competitive bidding process and even the hon. Gentleman, with his tenuous grasp of the market, will understand that its effect will be to reduce rather than increase bids. Secondly—I would not expect the hon. Gentleman to understand this point—the difference between what is happening now and what will happen in the future is that we are restructuring the railway to generate efficiencies by moving from the public sector to the private sector—efficiencies that have characterised every previous privatisation. I would go even further and say that the efficiencies that have emerged following previous privatisations have been greater than many people predicted at the time of privatisation.

The hon. Gentleman needs to understand—forgive me, he does not need to as he has managed to get thus far without understanding—

Mr. McLeish

That is patronising.

Dr. Mawhinney

The hon. Gentleman is right. It sounded patronising and, whatever else I may do, I do not wish to sound patronising.

I hope that the hon. Member for Oldham, West accepts that a fundamental change is in the offing for the railways, from which benefits will flow. Unlike the hon. Gentleman, I believe that the benefits should be shared between passengers and private sector train operators. I should have thought that that would be common ground between us but, having listened to him over the past few weeks, I am no longer sure that it is.

Mr. Meacher

The Minister has made an important statement. He said that it is not possible to predict the subsidy that will be required for private operators. From some experience of government, I believe that the Treasury would never permit such a policy to be adopted and announced without putting at least a rough estimate on what would be permitted. The Treasury would certainly never offer an open cheque book. Within what parameters does the Minister expect that subsidy to settle?

Dr. Mawhinney

The parameters are those that have been laid down on many occasions.

I remind the hon. Gentleman of what I said on Monday: The Government remains firmly committed to the franchising process and to providing the subsidy needed to support passenger railway services, including the effects of the new policy on fares. I am not at all clear whether the Labour party has switched from its demand that more and more taxpayers' money should be spent and now believes that less and less of their money should be spent. We are talking about a franchising, competitive bidding process, initiated today for the first three franchises. We will have to see what emerges, but I remain a good deal more sanguine than the hon. Member for Oldham, West.

Mr. Bruce Grocott (The Wrekin)

The right hon. Gentleman has said a great deal about intellectual rigour in his usual helpful manner. May we ask for just a little bit more of that from him? We are not asking for the parameters. Given his academic skills, the vast resources available to him at the Department of Transport and all the computers through which he can run the figures, will he please tell us the figures on which he has made his calculations about the subsidy that will be needed?

Dr. Mawhinney

I have not told the House that I have made any calculations. I have told the House about the bidding process. I have encouraged the House by quoting the potential operators, who understand, because they are in the marketplace, that the certainty of a seven-year fares regime, which most of them were not expecting, will allow them to make judgments about fares in the commercial framework. That certainty will enable them to appreciate the opportunities open to them in the fares structure and the provision of services structure to attract more people on to the railways. The opportunity to make such judgments will emerge from the efficiencies that will be generated by moving from the public to the private sector—something with which the Labour party has not even come to terms.

Let us consider the credibility test of the hon. Member for Oldham, West. On Monday, Sue MacGregor asked him: But what do you plan to do about fares? He replied: Well on fares, as I said, we have a very different philosophy. What the Government have done is to put their money into road building and cars, it has produced congestion and pollution. I think a much better alternative is to switch money steadily in the transport budget out of road building into investment in both the quality and the quantity of public transport. Sue MacGregor again asked him what he intended to do about fares and he said: That would certainly enable us to reduce, or certainly to hold fares, and hopefully to reduce fares steadily in off-peak hours, and I think that is a way of restoring patronage in public transport, but the really key point is, the difference between us and the Government, is that it would not be necessary in our case to have huge swingeing increases in taxpayers subsidies to pay for it. If I am clear, the hon. Gentleman is saying that the Opposition will decimate the roads budget and put it into the railways. The end result will be to hold fares, and hopefully to reduce fares steadily in off-peak hours".

Mr. Michael Trend (Windsor and Maidenhead)

We have done better than that.

Dr. Mawhinney

My hon. Friend is far too generous to the Opposition—we have done much better than that. The people will understand that. What about the credibility test on punctuality and reliability? The hon. Member for Oldham, West made much of that, but against the doom and gloom he offered to the House, he will be encouraged to know that in the first period of 1995–96 performance not only increased, but 88 per cent. of the passenger charter measurements were above the annual average.

Let us consider the credibility of the Opposition Front-Bench team. The hon. Member for Fife, Central (Mr. McLeish)—

Mr. Snape

Talk about the railways.

Dr. Mawhinney

I know that the hon. Gentleman does not like it, but if anyone was tempted to take seriously the contents of the speech of the hon. Member for Oldham, West, we need to know how much confidence we have can in them.

The hon. Member for Fife, Central also issued a press release on Wednesday. The press ignored it, as they did the one issued on Friday by the hon. Member for Oldham, West. I should like to be helpful to the hon. Member for Fife, Central by referring to it. In it, he said that the new fares structure was aimed at protecting politically sensitive areas but exposing the majority of travellers to potentially unlimited fare rises. That was wrong. It also stated that the announcement of Tendering arrangements for the first three franchises to be privatised had been "postponed indefinitely". That was on Wednesday; the arrangements have now been made public. According to the press release, the announcement of the new fare structure had been "postponed indefinitely"; it went out on Monday. Last Wednesday, the setting of minimum service standards for four further lines was "postponed indefinitely". That information went out on Tuesday.

I understand the embarrassment of the hon. Member for Fife, Central, but the country needs to know what he wanted it to know last Wednesday. Last Wednesday, he wanted the country to know that the establishment of a fares regime had been postponed indefinitely; the information went out on Monday. Service requirements for the next four franchises had also been postponed indefinitely; the information went out on Tuesday. Tendering for the first three franchises had been postponed indefinitely; that went out on Wednesday. Such is the credibility that we now attach to the utterances of Opposition Front Benchers.

Let me remind the House of the process in which we are engaged. I shall begin by setting down some common ground. In 1953, 17 per cent. of journeys in this country were made by train; today the figure is 5 per cent., and falling. In 1953, 24 per cent. of goods were transported by train; today the figure is 5 per cent., and falling. Conservative Members, at least—and I shall go so far as to say that I believe that the hon. Member for Oldham, West agrees—want that relative decline to be halted, and then reversed. There is only one argument to address: can that be done in the public sector alone? The answer is clear; it is—after 40 years of relative decline—no.

Mr. Alex Salmond (Banff and Buchan)

Will the Secretary of State give way?

Dr. Mawhinney


Let us consider past privatisations. The injection of private finance and investment decisions, private management skills and private sector sensitivity to customer needs has transformed those businesses and industries, to the benefit of their customers. No one, least of all Opposition Front Benchers, has produced any argument to suggest that rail privatisation differs fundamentally and qualitatively from other privatisations.

Mr. Hugh Bayley (York)

Will the Secretary of State give way?

Dr. Mawhinney

No, I must make progress.

We are told that, if we had to privatise, we did so in the wrong way. European Commission railways policy, in directive 91/440, supports the division of railway business into more commercially oriented infrastructure companies, and separate passenger and freight service operations. That is exactly what we are doing. What is happening in Europe today? The German Government have split the operation of track infrastructure from passenger and freight services by establishing separate profit centres. The Dutch railway is to be split into four independent businesses covering passenger services, freight, infrastructure and capacity management. The Austrian railways were restructured in 1994 to separate infrastructure and train operations, and to make the full cost of operation transparent. The Danish railway has been organised into infrastructure, passenger and freight companies.

In other words, we are genuinely leading the world in separating infrastructure from the provision of services, and recognising the benefits that the passenger can gain from the injection of private sector finance. Labour's problem—clause IV or no clause IV—is that it is rooted in the demonology of trade unions circa 1960. I must tell the hon. Member for Oldham, West that there is no question of an erosion of services; quite the opposite.

My hon. Friends noticed, as I did, that the hon. Gentleman did not offer any alternatives. I need to say a quick word or two about that before I conclude. The country has a right to know what those who purport to be the next Government would do to the railways. I do not want to embarrass the hon. Member for Oldham, West; I want to look at the party's leadership. What does its leader say? He comes to the House on Tuesdays and Thursdays and says that he leads his party. Let us see what he says. In October 1994 he said: Railways should stay in public ownership. But in January 1995 he said: I'm not going to get into a situation where I am declaiming that the Labour Government is going to commit sums of money to renationalisation. But also in January 1995, through his spokesman Alastair Campbell, he said: If the railways are privatised … we have plans that under a Labour Government the railways will be publicly owned, publicly run railways. [HON. MEMBERS: "Hear, hear."] I hope that Hansard will record growls of approval from the Opposition Front Bench.

In March 1995 the right hon. Member for Sedgefield (Mr. Blair) said: Our goal is clear. It is to ensure that we continue to have a publicly owned, publicly accountable, properly planned network. Nothing else will do. I was getting confused, as are my hon. Friends. The policies are here today, gone tomorrow. I wrote to the right hon. Gentleman on 3 May. I said: I wrote to you on 13 January asking six questions about Labour's policy for the railways. You did not reply. He did not even have the courtesy to acknowledge my letter. I continued: I assumed that this was because you were unable to answer the questions before the outcome of Labour's debate on Clause 4. Now that your Party has expressed a definitive view on state ownership, I am writing to ask for answers to my questions. I asked you: Do you intend to renationalise the railways? If you do, would compensation be paid to the shareholders of Railtrack? Precisely how would passenger services be brought back under state control, bearing in mind the legal franchises and contracts which will govern the use of the railways? If you do not plan to renationalise, what changes would you make to the way the railways are run? How would you fulfil Labour's commitment to encourage more passengers and freight onto the railways? Would you invest more in the railways and, if so, how much? I must amend that now to ask how much more it would be than the £80 million a year to which the hon. Member for Oldham, West has just committed his party.

My letter continued: Your campaign against railway privatisation will continue to lack credibility until you tell the British people what plans you have for the railways. I look forward to receiving your response. I put those questions to the hon. Member for Oldham, West in the first of our series of debates when the Labour party went one-nil down. After the second debate, the Labour party was two-nil down and after today it will be three-nil down. I was generous to the hon. Gentleman, as I invited him six times to attempt to answer even one elementary question about what might fleetingly be referred to as a smidgen of Labour party policy on the railways. The result was: nada, nothing, just a great big black hole.

I received no reply from the right hon. Member for Sedgefield in January, February, March or April. I wrote to him again in May and have received no reply thus far. I promise that I shall keep the House informed of the progress of the non-correspondence.

Today we have listened with interest to what the hon. Member for Oldham, West has had to say. Leadership—what leadership? Policy—what policy? Vision—what vision? As I sit here each time, I try to think who it is that the hon. Gentleman reminds me of. The last time he reminded me of one of those old-fashioned railway announcers who make plenty of noise but who do not say anything intelligible. Today he reminded me of Violet Elizabeth Bott, Just William's friend. When she had nothing constructive to contribute and when she did not get her own way, she would say, "I'll thcweam and I'll thcweam and I'll thcweam." We have been entertained today by the hon. Gentleman's thcweam. That sums up the Labour party's policy on rail privatisation: a frustrated thcweam. I suggest that Labour Members continue to thcweam and we will deliver the benefits that the rail passengers of this country are crying out for and will receive.

4.55 pm
Mr. Peter Snape (West Bromwich, East)

That was not so much a speech by the Secretary of State as an audition for a new job. It was the most deplorable speech that I have heard him deliver in the House. Having heard it, I shall proffer some advice to the Conservative party as a disinterested observer. The Conservatives would be better off sticking with the incompetence of the incumbent rather than putting up with that sort of behaviour. The Secretary of State did not mention the railway's present or future state; he simply made a series of cheap jibes reminiscent of a sixth form public school debate which were unworthy of a proper debate about the future of the railway industry. The Secretary of State should be ashamed of himself.

The state of our railway industry concerns many who have worked in that industry, and I must declare a passing interest as a member of the National Union of Rail, Maritime and Transport Workers. It also concerns those who rely on the railway industry for transportation of themselves or their goods and those who supply the industry with wagons, rolling stock and signalling equipment. It is interesting to see what those people have to say about privatisation. When the Bill to privatise the industry was first published, the Railway Industry Association made a submission to the Select Committee on Transport, in which it said: The impact of rail privatisation, arriving during the continuing severe recession and at a point when order books are at an all-time low, poses a frightening risk to the railway supply industry. The fundamental danger is that the vital need for continuing investment—in both rolling stock and track signalling and electrification infrastructure—will be lost amid continuing political debate and organisational uncertainties about the new railway administrative structures and the passage of the Rail Privatisation Bill. The Railway Industry Association recently submitted another paper to the same Committee, with the benefit of a year's experience of what has taken place since the passage of the Bill. It said: Despite repeated past ministerial assurances that our anxiety over privatisation causing a hiatus in investment was unfounded, the opposite now seems to be accepted as inevitable, almost as policy in some quarters. With all its faults, the pre-privatisation process of public funding for railway investment gave both the operational railway and the supply industry some basis on which to plan production and investment strategy". That is what the Railway Industry Association is now saying about privatisation, yet the Secretary of State did not refer to the plight of that industry or that of railway administration. In his hackneyed collection of cliches, he referred to the efficiency of moving from the public sector to the private sector. It is interesting to examine what has happened since track and infrastructure were separated from the main railway business when Railtrack was created.

In its recent evidence to the Transport Select Committee examining railway finances, the Passenger Transport Executive Group listed examples of cost increases which have occurred since the supposedly wonderfully efficient system was introduced, particularly since Railtrack assumed responsibility for infrastructure projects in April last year.

Centro, the passenger transport authority covering my area, pointed out that Railtrack's site supervision and possession costs amount to 48 per cent. of the contract cost at Five Ways station just outside Birmingham, compared with BR's figure of 21 per cent. at University station or 27 per cent. at Longbridge. Is that the promised land?

In Greater Manchester, electrification from Castlefield to Salford Crescent was originally estimated by BR at £2 million; Railtrack now estimates the cost at between £4.2 million and £5.8 million. Is that the promised land?

In Merseyside, erection of a waiting shelter at Waterloo on the Southport line, to keep the rain off the passengers or customers, originally attracted no design costs because it would have been done in-house by BR. Railtrack's design estimate for a waiting shelter is £53,000.

The original InterCity 250 project in 1990 for the west coast main line was estimated to cost £750 million to provide new trains for the route and to carry out track alterations, including speed improvements and resignalling south of Weaver Junction. The current project is estimated at £1 billion for the entire route to Glasgow, but that figure excludes rolling stock and cab signalling equipment on trains.

Recently, I accompanied a delegation to see the Minister of State about the west coast main line. It did not get very far because he did not give the impression of having much idea about what we were talking about or when the scheme would commence.

Mr. Nigel Evans (Ribble Valley)

On a point of order, Mr. Deputy Speaker. Considering what has occurred in the House in the past few weeks, would it not be appropriate if hon. Members who had something to declare did so at the beginning of their speeches? I notice that the hon. Member for West Bromwich, East (Mr. Snape) has listed in the Register of Members' Interests that he has remunerated directorships of West Midland Travel plc, Stage Carriage and Express Coach Services and Travel Agency.

Mr. Deputy Speaker

All right hon. and hon. Members know, or should know, the rules with regard to Members' interests. It is a matter for individual hon. Members.

Mr. Snape

In reply to that pretty cheap jibe, I declared an interest as a member of the RMT. The debate is about railways, so I do not see what relevance a directorship of a stage carriage bus service in Birmingham has to the debate.

Mr. Evans

A lot.

Mr. Snape

The hon. Gentleman says, "A lot"—[Interruption.]

Mr. Deputy Speaker

Order. Will hon. Members quieten down and get on with the debate?

Mr. Snape

By the pretty loose standards of the Conservative party, it probably is a lot.

I was talking about the attitude of the Minister of State towards a particular project on the west coast main line. When I pointed out that the £1 billion to which I referred did not include a sum for locomotives and rolling stock, he gave us the impression that they were not necessary. I pointed out then, and I do so again now, that, if the project gets off the ground, it makes no sense to install a brand new cab signalling system in 25-year-old electric locomotives. I presume that modernising the west coast main line could, would or should include the provision of new rolling stock and locomotives.

The hiatus to which the Railway Industry Association referred, and to which I referred earlier, is occurring right now. There is a continual decline in the standard of service being provided by what is still known as British Rail, and no conceivable sign, particularly in respect of equipment and resignalling, of the much vaunted private finance initiative doing anything about it.

My hon. Friend the Member for Oldham, West (Mr. Meacher) detailed the collapse in investment in railway expenditure. Excluding channel tunnel expenditure, the Secretary of State is halving the money available for expenditure on the railway industry in the next couple of financial years. He shakes his head, but the figures are there. His own Department gave them recently to the Transport Select Committee. The total rail expenditure in 1994–95 of £1.1 billion includes an estimate of at least half that towards the channel tunnel and the remaining £615 million, which is my personal estimate of what will remain, represents almost a halving of the money available.

The Secretary of State's much vaunted policy announcements about reversing the drift of passengers and freight from rail to road will not be enhanced given those figures. Although he seemed tentatively to go back on that pledge in a television interview last Sunday, presumably it still stands.

Both sides of the House accept that Ministers did not actually intend the hiatus in railway investment to which I referred when plans for privatisation were formulated, but it is about time they accepted that it is happening. If my hon. Friend the Member for York (Mr. Bayley) catches your eye, Mr. Deputy Speaker, I am sure he will refer to that hiatus in respect of his constituency and the future of ABB Transportation.

Restructuring the industry and uncertainties over future funding resulted in fewer infrastructure projects being developed and fewer started. In 1990, 10 resignalling schemes were brought before Ministers for approval. In the current year, there is one. As far as I am aware, none is scheduled for next year.

The Secretary of State presumably travels by train. Why does he not take a cab ride from Euston up the west coast main line? With the exception of new power signalling installation at Crewe, he will find a mixture of 1960s power boxes, early BR equipment and some London, Midland and Scottish equipment. If he passes through my home town of Stockport—I invite him to do so when he comes to see his constituency football team—he will see a series of Victorian signal boxes that were erected in the 1880s. There is no lack of signalling projects on which money should be spent, but money is not being spent. Far from those projects being considered for future investment, they appear to have disappeared completely.

I referred earlier to the private finance initiative, which failed to deliver any new projects apart from the Northern line rolling stock deal. The Heathrow express and the Networker leasing deal were set up before PFI was established under Sir Alastair Morton. Decisions have yet to be made on the channel tunnel rail link, west coast main line, crossrail or Thameslink. All that work is crying out for decisions and investment, but there is no sign of the go-ahead from the Department. Within the restructured industry, there is no strategy or focus for planning that embraces track, trains and stations and Railtrack has still to publish its 10-year plan.

The whole chapter of railway privatisation has been a disaster. It will take more than blustering from the Secretary of State to convince us differently and it is about time that the Government recognise that the project will not work and drop the whole silly idea.

5.6 pm

Dr. Robert Spink (Castle Point)

I wish to speak in support of the amendment in the name of my right hon. Friend the Prime Minister and I shall immediately inform the House why.

Rail was first nationalised in 1948. I remember it extremely well because it was the year in which I was born. Since that time, some £54 billion of public money has been invested in the rail service.

We should examine the impact of nationalisation and that £54 billion investment. The story is not at all good. The Opposition are in error in painting a picture of the golden heyday of a nationalised British Rail service. No such time existed.

Rail did not flourish or prosper—quite the contrary. Services were awful. They were unreliable. Management was pitiful and customer care was non-existent. The railways were run for the benefit of the unions and the workers, rather than for the benefit of the public.

Mr. McLeish

Was the hon. Gentleman's speech written by Conservative central office, or does he have his own views?

Dr. Spink

The hon. Gentleman will be pleased to learn that I have sat here and written a few notes simply to remind me when I was born and what has happened to British Rail since then. Central office did not provide me with any information whatsoever. I was not even planning to speak until I heard the disgraceful comments from the Labour Front Bench.

Mr. Jacques Arnold (Gravesham)

Does my hon. Friend not find it rather odd for a Labour Front-Bench spokesman to suggest that my hon. Friend is using notes from Conservative central office, when all his information was collated by the research assistants and goodness knows what else in Walworth road which exist to support a Front Bencher? It comes ill from the hon. Gentleman on the Front Bench, who uses other people's notes, to make such a comment about a well-informed Back Bencher.

Dr. Spink

We have already heard that the hon. Member for West Bromwich, East (Mr. Snape) is sponsored by one of the rail unions. The hon. Member for York (Mr. Bayley) is also sponsored by a rail union. The hon. Member for Hampstead and Highgate (Ms Jackson), who is hoping to speak—

Mr. Deputy Speaker

Order. This is all very well and interesting, but let us get on with some responsible debate, please.

Dr. Spink

I take your advice, of course, Mr. Deputy Speaker.

The result of the nationalisation of rail services since 1948 and the investment in them of public money has been a deplorable fall-off in the share of journeys on rail. In 1953, rail had 17 per cent. of all journeys. Today, that figure stands at a miserable 5 per cent. Clearly, the Government had to act to reverse that trend and to redress the situation.

I suspect that the Opposition will continue to call for more public investment to subsidise rail. I shall come to that later; first, I want to put the record straight on recent capital investment, which has been at record levels in recent years—£6 billion during the past five years. I congratulate the Government on that achievement. They have done extremely well by my rail service, to which I shall also come in a moment.

The investment of more and more public money has not resolved, and could not resolve in the future, the difficulties, and deliver the improving standards, reliability in service and increase in passenger numbers that are so much needed and that would lead to a better and more vibrant rail service at lower cost to the public purse.

I want today to concentrate on the line that serves the majority of my constituents—the London-Tilbury-Southend line or the Fenchurch Street line. The majority of people who travel on that line use Benfleet station. The LTS line will, I suspect, be a microcosm of what will happen throughout British Rail as a result of the Government's initiatives. I welcome the excellent recent news for rail travellers.

The scene is now set, certainly in Castle Point, for a dramatic increase in passengers travelling on the Fenchurch Street line in coming years. I hope that we can climb back from the current level of passengers on the line, at about 22,500 passengers a day, and beat the peak number of passengers, which was more than 30,000. I hope that, by the millennium, we can reach a level of 35,000 to 40,000 passengers a day travelling on the Fenchurch Street line.

Let me say how we can achieve that. Passengers will be attracted by a range of factors. The most important of those is the real terms reduction in fares that can now be expected as a result of the Government's excellent strategy to hold fares at the level of inflation for three years and then to reduce fares below the retail prices index by 1 per cent. during the following four years, which should lead to a 4 per cent. overall reduction in fares in real terms by the year 2003. [Interruption.] That is not laughed at by my constituents as it is by Opposition Members. It is important to my constituents because they need to plan ahead. They need to decide how they will travel up to London, to the City or docklands, in order to work.

In addition, during the past two years there has been a continued improvement in service reliability. That is remarkable, particularly when one takes into account changes on those lines. Omelettes cannot be made without cracking eggs and the line has suffered disruption as a result of an important resignalling investment. Despite such disruption, dramatic improvements have been achieved on the line.

The Government have invested £150 million in the resignalling project, which started about 15 months ago and is now almost complete. It is delivering the goods. It will improve reliability tremendously. I am delighted to see the hon. Member for Fife, Central (Mr. McLeish) nodding in agreement. Why then did the hon. Member for Oldham, West (Mr. Meacher) not allow me to intervene when he said that investment in resignalling has been cut by two thirds? He did not because he is running scared of his own false information.

That is not the only improvement on the Fenchurch Street line. In about a year's time, we will have 25, 317 sliding-door trains to replace the 35-year-old slam-door trains. That will deliver further improvements in rolling stock. All those factors will help to bring people back on to the line.

Sir Michael Grylls (Surrey, North-West)

I am following my hon. Friend with great care and I am sure that he is right to say that privatisation, if it works properly, will attract more passengers on to the railways. Whatever our political point of view in the House, with the crowded roads and everything else, it must be everyone's wish to see more passengers on the railways. There is a huge incentive in privatisation for businesses to grow by attracting more passengers and by providing a better and better service. It is a classic service industry that needs to be in the private sector. It is amazing that the Opposition have not learnt that.

Dr. Spink

I am indebted to my hon. Friend who speaks with his characteristic wisdom on the matter. I shall come to the direct impact of privatisation and the new management and worker culture that that will bring with it, and the positive impact of that on customer care, service levels and innovation, providing, for example, new off-peak services which will also help to get passenger numbers up.

I introduced the subject by discussing the investment that my line has seen as a result of sound Government policy in this area. My hon. Friend the Member for Basildon (Mr. Amess) has been one of the prime movers who have pushed for investment in the line. He takes a great interest in what will happen in the franchise deal. I know that he continues to see Ministers. I believe that he saw a Minister last night on the subject to press the case of his constituents in Basildon. He is an assiduous worker for his constituents, as we all know.

Mr. Nigel Evans

Does my hon. Friend find it somewhat bizarre that this is an Opposition day debate on the privatisation of the railways, yet only five Opposition Back Benchers are present and all of them are sponsored by the Transport and General Workers Union, the National Union of Rail, Maritime and Transport Workers or the Associated Society of Locomotive Engineers and Firemen? Where are all the others if they are so concerned about the railways?

Mr. Deputy Speaker

Order. I have already pointed out the limited time available. Seven hon. Members hope to catch my eye in the next hour and interventions of that nature do not help.

Dr. Spink

In that case, Mr. Deputy Speaker, I shall chug along.

Through ticketing is now offered by hundreds of stations, one of which is Benfleet in my constituency, the station which serves the greatest number of passengers who use that line. My constituents welcome that and are grateful to the Secretary of State.

We all read what the franchising director, Roger Salmon, said yesterday about passenger service requirements. Private operators, including those on the LTS line, will run more trains. We can look forward to innovative off-peak developments which will boost passenger numbers after line privatisation. I hope that the LTS line capacity will be increased by 13 per cent., as foreshadowed by the passenger service requirements announcement yesterday. That is good news for the people of Essex.

All that will lead to more passengers. More passengers will lead, naturally, to lower subsidies and less demand on the public purse. An increase in passengers will take vehicles off the road, which will help us environmentally and economically. Therefore, I very much welcome all those initiatives and strategies, all coming together this week, which is what I regard as a very positive week for rail for the people of Essex.

The current London-Tilbury-Southend line management are bidding, with some of their employees, for the franchise deal. The management have shaken off the "misery line" tag that was attached to the Fenchurch Street line and, in spite of all the disruption of the resignalling, have performed exceptionally well recently.

During the passage of the Railways Bill, I argued strongly with Ministers that local management and employee teams should be able to bid for franchises. I was delighted that provisions to that effect were included in the Bill in the end. I understand that a significant number of local rail employees, many of whom are my constituents, are interested in investing in and supporting the bid by the management and employees for the franchise. I say no more about that, because I might embarrass my right hon. Friend the Secretary of State, but the future has never appeared rosier for rail in Essex.

I shall now briefly discuss the national scene. We all want a more successful rail network, reducing public subsidy and helping to improve the environment. We all know that Conservative policy is delivering that. The policy, as applied to my local line, is an exemplar of that phenomenon. However, we do not know the Opposition's policies. The Opposition owe it to the people to stop being dishonest and to tell us those policies, because they have, on that as on everything else, no policies. They are doubly dishonest on that, as on everything else.

On the elusive, job-destroying minimum wage, for instance, Labour Members promise the public everything, but will they say what amount it would be? No, of course not. They have no policies. The leader of the Labour party has no answers to the questions about levels of investment or the renationalisation of rail. He has a policy vacuum. Apart from confirming that, during the past two decades, he and the Labour party have been entirely wrong and we have been entirely right, he has nothing to offer. The Labour leader is frozen in our headlights like "Blair rabbit", with no original ideas. If Opposition Members want more investment, will they be honest—will they intervene on me now? I shall sit down and take an intervention. Will they tell me how much more investment they want?

Mr. Deputy Speaker

Order. Do not tell him.

Dr. Spink

Will the hon. Member for Ashfield (Mr. Hoon) tell me how much more investment he wants? Will he tell me where the money is coming from? Will he tell me which other services he would cut to provide that investment? Will he tell me which taxes he will raise to provide that investment? Of course not, because Labour Members are too dishonest. They are doubly dishonest.

Labour Members consider that the people of Essex are fools and do not understand that. The people of Essex will show them at the next general election, as they did at the last general election and the one before that and the one before that and the one before that. They are not fools, and they will not accept the Opposition vacuum.

5.22 pm
Mr. Paul Tyler (North Cornwall)

One can always detect when a Minister expects to be reshuffled because he starts giving hostages to fortune with reckless abandon, confident that someone else will have to live with the consequences.

The Secretary of State said a few minutes ago: there is no question of an erosion of services; quite the opposite". That was almost the only positive statement in his speech, which was mostly good knockabout stuff about the Opposition. As the motion is all about Government policies, it is curious that he felt it necessary to spend so much time talking about the credibility of the Opposition.

As the right hon. Gentleman is the first Secretary of State for Transport in living memory to be perceived as being on the way up rather than on the way out, those hostages have an absurdly optimistic look about them. His statements in the past few days have forecast a dramatic improvement in passenger loading, in revenue and in profitability, and he repeated that forecast at the end of his speech.

The Secretary of State even suggested that that improvement will outweigh the cost of fare capping in the seven years that it will affect. I am sorry that the Secretary of State is no longer in his place as I wanted to test whether, on his criteria, there was credibility in the statement that capping rail fares would mean the taxpayer having to provide more money for subsidies to British Rail and a bigger burden on the taxpayer. Those were the words of the previous Minister for Public Transport, the right hon. Member for Kettering (Mr. Freeman). When the Minister for Railways and Roads, his successor, replies to the debate, I should like to hear whether he continues to agree with the right hon. Member for Kettering, because if so, everything that we have heard from the Secretary of State in the media and in the House today appears pretty silly.

Dr. Spink

Will the hon. Gentleman give way?

Mr. Tyler

No, I have hardly started. The hon. Gentleman took so long that he has cut down the time available to everyone else.

Mr. Deputy Speaker

indicated assent.

Mr. Tyler

I see that you agree, Mr. Deputy Speaker.

That statement was reported in The Times yesterday. The report concludes: The credibility of Brian Mawhinney, the Transport Secretary, rests on him shelving the sale of Railtrack … Mr. Freeman's remark may become Dr. Mawhinney's political epitaph. That is what has happened in the past few days—the Secretary of State, with reckless abandon, has turned the promises and assumptions of his predecessors on their head. It flies in the face of all the expert analysis and all the empirical evidence from this country and other countries. A more realistic projection would show that only about half the shortfall from fare capping can be made up in that way; however, by the time he is found out the Secretary of State will have got out of the hot seat—he will be out of the driver's cab.

That is the second lesson of the week. Despite all the ministerial wriggling both within and outside the House, denying direct responsibility for any of the uncomfortable truths that have emerged, the Secretary of State and his colleagues remain in hands-on charge of the railway system. Sitting next to the franchising director at the press conference, looking as though he was working the puppet on the string, was the Secretary of State. All the pretence that he has nothing to do with what is happening on important operational issues has been blown to smithereens.

Another lesson can be learnt from the events of the past two or three days. Again, we have had government by press release. The Secretary of State had an opportunity to explain in the House his rationale for all the statements that have emerged from the Department of Transport. Did he take it? Of course he did not. He simply had a go at the Opposition. This was the opportunity to come to the House of Commons and explain to sceptical Conservative Back Benchers as well as Opposition Members what is in his mind. Instead, what does he do? He softens up the public with a series of major media events. That is what is called managing the media. Then the Secretary of State ducked out of sight as soon as there was bad news to be told to the House or to the nation about his doom-laden enterprise.

The news is not good. There is no need to take my word for it. Listen to this, Mr. Deputy Speaker: The new and very different regime that we are putting in place is bound to involve a significant period of adjustment before you can expect everything to be working smoothly. And then: we need to take stock and decide whether even the direction in which we have been going is the right one for the future". Who was that? It was not a Liberal Democrat, nor a Labour spokesman, nor a sceptical Conservative—there are plenty of those on that issue—but the new chairman of British Rail, Mr. John Welsby, just appointed by the Secretary of State to carry through that enterprise. Obviously, that opinion may be influenced by the failure of Ministers to consult properly before changing all the privatisation signals.

I suspect that many of the key participants, the people whose business is affected by those changes of track, such as London Transport and British Rail, were given no forewarning of the events of the weekend and the statement on Monday although it affects all their budgeting and, indeed, everything that they do. Is it any wonder that people wonder what is happening?

Whatever the reason for that deep-seated lack of confidence within the industry, it is now obvious to everyone both within and outside it that the preparation for privatisation has resulted in a large and ever-growing hiatus in necessary investment. One can bandy figures around, but it is clear that there has been a hiatus in the past few months and in the past year. Whether an extra £500 million is required, or whether it is more or less, everyone accepts that there has been a hiatus.

Mr. Welsby assures us that, having slipped on the privatisation banana skin, the railways are recovering their poise. That is all very well, but surely it is always preferable to avoid the banana skin in the first place—and why the wanton and deliberate distribution of banana skins throughout the industry?

The most obvious way in which the travelling public are affected is in terms of punctuality and reliability. If we consider just the south-east, the blight is already apparent. The worst deterioration in reliability is on the Northampton line, where the percentage of trains cancelled has gone up by 219 per cent. The North London line has the largest number of cancellations—4,039 on that line alone, with nearly one service in 20 affected. The North London line also has the biggest increase in cancellations overall—1,253, up 34 per cent. on the previous year.

Mr. Streeter

I am not sure whether the hon. Gentleman is making a case for or against privatisation—it is possible that he may not make up his mind until the end of his speech—but is he aware that the Liberal Democrat-controlled council on the Isle of Wight has welcomed the fact that the Isle of Wight will be one of the first regions to have rail franchises? Does he agree with the council?

Mr. Tyler

I recognise that the hon. Gentleman does not often attend transport debates. If he did, he would have heard me answer that point on two occasions, I believe. We have never resisted the case for franchising individual services. We have always said that Railtrack is the key to an adequate and effective public service in the public interest.

Punctuality and reliability figures are not the whole story. Evidence of the myriad other ways in which the privatisation programme is devastating the network is piecemeal and anecdotal, but when it is all put together the picture is of a network already at sixes and sevens. I cite a trivial example which nevertheless illustrates the overall mind set that is taking such alarming hold on the system. In Bolton, the Greater Manchester passenger transport executive had been planning to install new toilet facilities. Now, according to a spokesman, it cannot do so because of the changes in procedures and organisations in the run-up to privatisation". Replying to a passenger who complained about that, the spokesman said: I am sure that you realise that it would be invidious if the investment of public money in funding improvements led to an increased demand for subsidy from the operators". That is an extraordinary statement, and it has been replicated throughout the system. I wonder whether that spokesman will have to reconsider his comments following the Secretary of State's statement on Monday.

Up and down the country, people are finding it impossible to discover how to get from A to B—the prerequisite of a user-friendly rail network. If one travels from Bury St. Edmunds to London, one can go via Ipswich to Liverpool Street or via Cambridge to Kings Cross, but if one consults the timetable at Bury St. Edmunds or at Liverpool Street, one will find no evidence of the Cambridge trains. They are ghost trains; they do not exist, even though some of them are faster than other trains. Stranger still, at Kings Cross one will find no mention of the Cambridge trains either. That has presumably led many an unsuspecting, unwary passenger to slog across a bit of London to Liverpool Street, ignorant of the fact that there was a better train waiting just along the way.

That lunacy come about because the services via Ipswich are operated by Anglia, while those via Cambridge are operated by the West Anglia Great Northern line, and the two companies seem to have no great desire to co-operate. A WAGN line spokeswoman said: it must be taken into consideration that during the restructuring for privatisation, British Railways was split into separate companies. Consequently, we have no more jurisdiction over a fellow train-operating company, such as Regional Railways, than we have over London Underground or any other public transport company". It is no wonder that the travelling public think that the rail network is disintegrating because that is precisely what is happening.

Sir Russell Johnston

Will my hon. Friend allow me to give another example? He will know that on the 28th of this month all motorail services in the United Kingdom are to be terminated without any consultation. They used to carry 40,000 cars a year within what was InterCity, when Chris Green was the manager of InterCity, which made an overall profit. Is that not scandalous?

Mr. Tyler

I agree with my hon. Friend. His comment applies also to a number of sleeper services. I refer not to the one before the courts, but to other sleeper services. I hope that the Minister will deal with that point.

The position is deteriorating. The co-operation that the Minister claimed would be there is simply not there. I think that all hon. Members are grateful to Christian Wolmar and The Independent for their series on great railway disasters, which has pointed up some of the ways in which services are deteriorating. If some of the examples were not so tragic for passengers, many of them would be hilarious.

It is no wonder that British Rail is worried because it is likely to have to pick up the bits from this mess. As is widely known, in its evidence to the Select Committee on Transport, which has already been mentioned in the debate, British Rail expressed grave anxiety about the effects of the hiatus on the future of the railways. Investment in resignalling, which was its top priority, is way below desirable levels. The same is true of rolling stock, where little or no prospect exists of new orders. I hope that the Minister will tell us how much rolling stock has been ordered this year, and how much is in prospect for the next financial year.

Meanwhile, perhaps most serious of all, essential maintenance requirements are not being met, or people are just scraping by. Repairs that would once have been carried out on the same day are now delayed or are dropped in favour of supposedly temporary lash-ups. It is not commonly known that cracked rails, for example, are often clamped together rather than fully mended, and no one is sure what the fatigue life of those clamps may be. Speed and weight restrictions result. They last longer, are more common and have a more devastating effect. The east coast main line is a noteworthy victim, but other main lines are at risk.

I am glad to see that the hon. Member for St. Ives (Mr. Harris) is here as he and I share an interest in the main line through Cornwall. He may be interested to know that data from internal memoranda that I have seen suggest that an on-going decline in track standards is taking place on the Great Western main line. On the Plymouth to Penzance line in recent months, there have been major restrictions: 30 mph between Menheniot and Liskeard, 20 mph between Par and St. Austell, and 40 mph between Long Rock and St. Erth. That is having a devastating effect on the reliability of the timetable and is threatening the long-term future, whatever happens to the franchise, of the main line 125 express services through Cornwall. The hon. Gentleman knows all too well what effect that would have on the economy and, specifically, on the holiday industry.

Speed and weight restrictions are alarming in themselves, but if safety risks follow, the situation is obviously even more serious. Ministers profess ignorance, but the signs are not reassuring. Despite all that, it seems as though the early bidders for the train operating unit franchises may still find that they are offered enough sweeteners to make it all apparently worth while. Pumped-up subsidies and a benevolent interpretation of passenger service requirements could make bidding an attractive prospect for the first tranche. Ministers aim to have 51 per cent. of services in private hands by April next year, but there is still the other 49 per cent. and Railtrack. What sweeteners can the Secretary of State possibly offer to make that pig's ear look like a silk purse, or is he keeping his fingers crossed that he will by then have moved on and someone else will have to square the circle?

It is rather like the cases involving the first fundholding general practitioners or the first opt-out schools. They were attractive to start with, but latecomers did not receive so much and did not find it such an attractive prospect.

For years, Ministers have told us that fares must rise to cut subsidies. This week, however, we are told that fare cuts will attract so many new passengers on to the railways that that will lead to subsidy cuts. The Secretary of State appeared to say that again this afternoon. We are all left wondering why, if that magic formula exists, Ministers did not find it many years ago.

5.39 pm
Mr. James Clappison (Hertsmere)

I welcome the opportunity to make a brief contribution to the debate. My interest is on behalf of my constituents who use the railways, particularly those who commute every day from Potters Bar, Radlett, Elstree, Borehamwood, and other destinations on those lines.

The debate was opened by the Opposition in a way that is familiar to those of us who have attended other pre-privatisation debates. The general theme is that privatisation never works and that it will be a disaster. The hon. Member for Oldham, West (Mr. Meacher) went into some detail about that. What the hon. Member for Oldham, West said today belies the experience of other privatisations and what we have been told about new Labour. We have been told that new Labour is friendly to private enterprise, friendly to the market and friendly to private ownership, but there was nothing to distinguish what was said from the Labour Front Bench today from what has been said so many times since 1979 about so many other privatisations. It was a continuation of the same old socialist arguments. There was not even a dressing of new Labour to cover it up.

The reaction of both the Labour party and the Liberal Democrats to the announcement about fares was disappointing. Opposition Front-Bench Members could have found it in themselves to welcome the news that fares will be pegged over the next seven years. They should have welcomed the fact that there will be a real terms benefit to my constituents who use the railway as well as to other rail users, including their constituents. I did not hear a single word of welcome for that. Instead, what we saw clearly was disappointment etched on the faces of the spokesmen for both the Labour party and the Liberal Democrats about the good news that rail fares are to be held down—[Interruption.] The reaction of the Liberal Democrat spokesman was of equal disappointment. I can tell him that my constituents in Hertfordshire, including those who are told perpetually by the Liberal Democrats that rail fares should be held down, are pleased that they are being held down. They would rather hear that than hear complaints about toilet facilities in Manchester and the other long list of complaints that the hon. Gentleman gave.

The fact that the price of fares is to be held down is of interest to the Central rail users consultative committee. Major General Lennox Napier of that committee welcomed that as good news for passengers. He speaks for commuters. He said: This announcement marks a turning point in policy. Holding fare rises down will increase the attractiveness of the railway and stimulate greater use. We have been calling for years for fare rises to be linked to inflation and quality of service. I am delighted that the Franchising Director, supported by extra Government subsidy, has adopted a policy which could result in a real fall in the cost of rail travel.

Mr. Tyler

Will the hon. Gentleman give way?

Mr. Clappison

I will not give way, because as the hon. Gentleman said in his speech, time is short.

Throughout the debate Opposition Front-Bench Members have been chanting from a sedentary position that fares have increased by 22 per cent. in real terms over the past 10 years. I must admit that that is right. If Opposition Members look a little further back, they will find that over the past 16 years of Conservative Government fares have increased in real terms by 29 per cent. As we have said, we want to change that. However, I warn Opposition Members, particularly the hon. Member for Oldham, West, not to go back any further because—[Interruption.] Well, I might be tempted. According to the figures supplied to me by the House of Commons Library, between 1974 and 1979 there was a real terms increase in rail fares of 31 per cent. That is more in five years under Labour than in 16 years under the Conservatives.

Another instructive feature of the statistics is that the figures that are not adjusted for inflation—the nominal increase—show that under the last Labour Government rail fares rose by over 170 per cent. That drives me to the conclusion that Opposition Members are no more entitled to lecture us on rail fares than they are on inflation.

Another argument used by Opposition Members is the lack of investment. The statistics seem to be at odds with what they are saying. The hon. Member for Oldham, West went into some detail on investment, but the statistics with which I have been supplied from the Library support what has been said by Conservative Members. Over the past 16 years the average investment in railways has been in excess of £1 billion, markedly higher than between 1974 and 1979.

The hon. Member for Oldham, West told us about the east coast main line. He used his experience of that line to illustrate his argument about the lack of investment. He mentioned particularly the line between London and Leeds. If Opposition Members want to choose any line to illustrate a lack of investment, they should not choose that one. They will know that over the past 16 years that line has been electrified and that the service has been considerably improved. Since the hon. Member for Oldham, West finished his speech I have been told by the Library that when his party left office in 1979 the fastest journey time between London and Leeds was just under two and a half hours. Today, the fastest service time between London and Leeds is just under two hours. The hon. Member for Fife, Central (Mr. McLeish) may laugh, but that is of interest to those who use the line.

The hon. Member for Oldham, West complained about a points failure on that line. The only points failure came at the beginning of his speech when he was asked, quite properly, by my hon. Friends about whether he would nationalise the railways and he said that he would return to that later. I was expecting an express journey to the end of his speech where he would tell us what he thought should happen. Instead, he did not reach his destination. We had a points change, a gentle shunt and ended up going backwards to where the hon. Gentleman had begun with a long list of complaints. We have no inkling what the hon. Gentleman would do about railway services.

What will be of interest to my constituents, apart from the good news about fares being held down, is that under privatisation they can look forward to a better quality of service and a greater sensitivity towards the needs of customers, which has been a characteristic of every other privatisation. I hope that in the coming years we will see the sensitivity that has been applied to fares being applied to other parts of the service. I am thinking particularly about car parking charges. That is a matter of great concern to my constituents.

The cost of parking must be considered when we look at the cost of travel. On that point I must be critical. Over a number of years, certainly over the past five years, British Rail has insensitively increased parking charges way above the level of inflation. The increase has been an imposition on my constituents. This year alone there has been a 40 per cent. increase in charges for my constituents in Elstree and a 25 per cent. increase for my constituents who use the car park at Radlett.

I am told by my constituents in Radlett that since 1989 the cost of parking has more than doubled. Off-peak parking, which is particularly valued by my constituents in Radlett, was free before 1989; it then had a charge put upon it and has now increased to the full level. That causes considerable annoyance to my constituents. I have received many representations about that from individual constituents as well as from business people and local residents who are inconvenienced by the wider traffic implications and problems caused by the increased charges. I have received a particularly strong representation from the Radlett Society which I endorse fully.

When I took up the matter with British Rail its response was unsatisfactory. I was told that the increases were being imposed as a quid pro quo for improvements in service such as the introduction of closed circuit television. Those improvements have yet to come about and I have been told that no decision has yet been taken in principle to install closed circuit television in Radlett. Those are matters of concern to my constituents.

I expect such problems to be remedied by the greater sensitivity to customer needs that will come about after privatisation. We know from successive privatisations, beginning with British Airways in 1979, that once private sector management skills are introduced and there is access to the resources of private finance, there is a sea change in attitudes to the customer. In this case, not only will those factors be at work but the service will be backed by the stringent passenger service requirement agreed between the franchisee and the authority.

We expect a much better service. We have put out our proposals to improve services but have heard nothing at all from the Opposition about theirs. We heard nothing about how they would move to public ownership or about the compensation that might be payable in that event. My worry, on behalf of my constituents, is that the Opposition are determined on a course that will take us back to a declining railway service, that will require huge amounts of compensation and public money and from which my constituents will receive no benefit whatsoever.

5.50 pm
Mr. Hugh Bayley (York)

I am sponsored by the National Union of Rail, Maritime and Transport Workers, RMT. However, after the announcement last week of the closure of the York carriage works, I am sure that I speak on behalf of all my constituents when I tell the House that the mood in York is one of bitterness, anger and betrayal at what the Government have done to York with their rail privatisation measures.

There is bitterness because the Government promised that there would be no hiatus in rail investment, but there has been a hiatus and the works are closing as a result. There is anger at the comment that the Prime Minister made on the day that the closure was announced last week. He said that rail privatisation was no more to blame for the closure than it was to blame for an outbreak of measles. That flippant and foolish comment will hang round his neck and haunt him and the Conservative party in north Yorkshire for many years to come.

People in York, especially those at the carriage works, feel betrayed because the company, ABB Transportation, has done everything that the Government asked. It bought into the railways and invested £50 million in the York works. The workers have done everything that is necessary to double productivity and, together with the management, to design and build the most modern aluminium railway carriage body shell that is built in Europe—the only one that has the European Commission's full safety certification. They have done all that was asked of them and their hopes have been dashed by the closure, which has been brought about by the freeze in rail investment in the run-up to privatisation.

Two years ago the House debated the Railways Bill. When rail privatisation started, 4,687 people worked for British Rail or for ABB in my constituency. By the end of this year, on the basis of jobs that have gone already or redundancies that have already been announced, that number will have fallen by almost half to 2,583.

When he addressed the House, the Secretary of State sang the praises of privatisations in other industries. However, even he did not have the gall to mention the privatisation that was the stalking horse or pilot study for rail privatisation—the privatisation of British Rail Engineering Ltd. It was sold off in 1989 and since then, it has faced never-ending decline.

That is a disaster for the company that invested in the city of York, Derby and Crewe and a disaster for the work force. When the Railways Bill was going through the House, 1,600 people were employed at the York carriage works; now that number is down to 750. In the light of last week's announcement, by the end of this year, the last man will have walked through the factory gates for the last time. That will be it. After 150 years of building trains at York, it will all be over. Those 1,600 men, who helped to modernise the company to make it competitive and to design new products, which the Government said were wanted, will be cast on to the scrap heap.

Some weeks ago, I met a man who was made redundant from the York works in October 1993. Since then, he has had just nine weeks' work: four weeks one Christmas at one of York's chocolate factories and five weeks as a storeman at a local supermarket.

I have invited the Minister in the past to come to the York works to see what was threatened by rail privatisation and to meet the work force whose jobs are on the line. If he met that man or any of the other 750 still employed at the York works, could he honestly look them in the eye and tell them that rail privatisation was a success, that it was good for them or for the travelling public?

Nobody can say that the Government were not warned what rail privatisation would do. The Transport Select Committee called on the Government to address the problem of the hiatus in rail investment. The Government promised the House that there would be no such hiatus.

On BBC television, in December, Sir Bob Reid, then chairman of British Rail, said: There is a hiatus. The question is, how short can that hiatus be kept? If that hiatus can be kept short, ABB will still be around to build trains. Earlier this year, Eric Drewery, the chairman of ABB, warned the Transport Select Committee that if an order was not received extremely quickly, the York works would close and said: To close down highly productive world-class manufacturing facilities is like a stab in the heart. The Government have stabbed and the York works are bleeding to death.

On Friday, the day after the closure announcement, I met the company's managing director and asked him if there was anything that could be done at this late stage to save the York works. He said that there was only one thing: the Government could tell British Rail to authorise the follow-on order clause in its current contract. That, and that alone, could save the York works, because no other order could come in time to keep people in production. He gave a guarantee that if the Government took that action, his company would feel honour bound to continue production at the York works.

Why will not the Government act? Such action is affordable. It would cost the Government nothing this financial year, probably nothing in the next financial year and there would be a leasing charge of £10 million or £15 million in the following financial year.

The trains are needed. The Transport Select Committee received evidence that 2,500 London commuter carriages urgently need replacing. If the Government asked the Kent or Hertfordshire commuters whether new rolling stock was needed, they would get a resounding yes.

We also need action for the sake of industry. Other European countries are facing up to the need to reinvest in their railways and to maintain their manufacturing bases. Deutschebahn in Germany has placed orders for new rolling stock worth £4.6 billion; in Italy, orders in excess of £5 billion have been placed.

Those other members of the European Union are laughing all the way to the bank because, aided by ABB's main competitor GEC, they too are getting a large share of the new rolling stock orders that have been placed in this country. GEC won the contract to build the new trains for London Underground's north London line. It cannot build the aluminium body shells; there is only one company in Britain that builds modern aluminium body shells—ABB. GEC had to subcontract the work. ABB had bid for work and offered the lowest price but did not get the contract, which went instead to a GEC subsidiary in Spain.

By 1990, there was a £28 million deficit in the UK balance of trade in rolling stock. By last year, the deficit had risen to £126 million. With the loss of the ABB works in York, it will be even higher. Even if orders were only at the level of the past few years, there would be a net reduction of £150 million a year on that balance of trade. We cannot afford the current deficit in industrial terms, or in railway terms.

Since the closure announcement, York city council has put up £50,000 and the North Yorkshire training and enterprise council has put up a similar sum in order to find alternative jobs for the redundant workers. The trade unions have talked to local engineering employers, and I hope and believe that they have found places so that at least the 20 apprentices can finish their training. However, the Government caused the problem and the Government must be part of the solution.

Will the Minister give an undertaking that the Government will put money into the York economy to find new jobs for the men whom they have placed on the scrap heap? There is no way that the existing economy there can find jobs for the 750 men who have been made redundant. Indeed, local employers have not been able to provide alternative jobs for the 1,100 people made redundant in the past two years. New jobs are needed in York. The Government could respond through their single regeneration budget and I ask them to say now what they are going to do to solve the employment crisis that rail privatisation has created in York.

6.1 pm

Mr. Tim Smith (Beaconsfield)

Like all hon. Members, I am a customer of British Rail, and so are most of my constituents. My interest in this debate relates to the quality of customer services provided by the railways and I believe that if we get that right, the employment that we seek will follow automatically. The important thing is to get the quality of service and the reliability right.

Nationalisation has been a great disappointment. In 1948, when the private railway undertakings were nationalised by the Labour Government, there were high hopes that bringing together all the businesses into British Rail would somehow improve the quality of service, reduce fares and increase the number of people using the railways. As we know, in the intervening period—almost 50 years—the proportion of people using the railways has fallen decade after decade and the proportion of freight being carried by rail has fallen too, as my right hon. Friend the Secretary of State told the House.

One of the main problems was the sheer size of the undertaking. British Rail was a massive organisation and its size made it difficult to manage. Ten or more years ago, the Government introduced private sector management into the organisation, since when there has been a succession of chairmen who have been some of our leading industrialists. Among the most successful, for example, was Bob Reid, the former chairman and chief executive of Shell UK. He was brought in to run British Rail but found it simply impossible to change things from the top down. The reason was that the culture of British Rail was so deeply ingrained that it was never going to be possible for one person, however skilled in management, to change it.

I strongly support the changes that are coming with privatisation, especially those in British Rail's structure. It is especially important to reduce the organisation to units that are easier to manage in human terms and more likely to relate to customers. There have already been changes, certainly on the two lines that serve my constituency.

I met the manager of the Chiltern line last week to talk about the changes being made in anticipation of privatisation. Apparently, it is still not possible to discover the line's turnover—how much it generates in fares and how much subsidy it receives. British Rail used to put all these things together in its accounts and even it did not necessarily know the subsidy for a particular commuter service although, clearly, it would know the income from fares. From 1 April a new company has been established under the Companies Acts which will run the line and, some time after the end of the financial year next March, we shall discover the line's turnover for the first time and what revenue subsidy it is receiving.

The good news is that the turnover is already starting to increase, the service is already more responsive to customers and the manager has brought in management from the private sector. I believe that the key management skill is marketing. With privatisation, there is a real opportunity to increase sales, contrary to what the hon. Member for Oldham, West (Mr. Meacher) said.

Basically, the railway business is a fixed-cost business. The fixed costs are the payments to Railtrack for the use of the system and the payments for the lease of the trains but, after that, it is up to the individual company to extract the maximum possible from the assets being used and to generate more business. I also believe that there are tremendous opportunities for increased efficiency. In every privatisation, we have tended to underestimate the scope for improved efficiency but, in this instance, there is also an opportunity to improve the quality of customer service and profitability and, at the same time, to reduce the subsidy paid by the taxpayer.

I greatly welcome the decisions made by the Government in the past three or four months, including that on through ticketing. It was right that there should be a proper debate on the matter. The more through ticketing there is, the greater the costs involved, but the public felt strongly that it should be maintained and I am glad that the Government decided not to change the present level of service.

I also welcome the more recent decision to peg fares for the next seven years. We have become used to that under previous privatisations and seen massive reductions in prices. I do not suppose that there will be such reductions in this industry but, if we have no real terms increases, that in itself will be a major step forward because, as we have heard, fares have increased by 22 per cent. in real terms over the past 16 years and, in the five years before that, by some 31 per cent. according to my hon. Friend the Member for Hertsmere (Mr. Clappison).

Mr. Peter Ainsworth (Surrey, East)

Like me, my hon. Friend represents part of the south-east where there is a great deal of concern about overcrowding on the roads and about the environmental damage done by cars. Does he agree that the decision to control fare increases on the railways might play a significant part in encouraging people out of their cars and back on to the rail network where that proves to be a sensible option?

Mr. Smith

There are two important matters when it comes to providing a decent rail service, and one is price. The hon. Member for Oldham, West was dismissive about that, but my hon. Friend is entirely right. Anyone examining the options will weigh up the price and possible benefits.

The other key characteristic—it is impossible to overstate its importance to a rail service—is reliability. My constituents want to know that the train will turn up at the time advertised in the timetable and arrive at its destination at the time advertised in the timetable. Indeed, every day a huge proportion of trains on the Chiltern line fulfil that desire. When the services are privatised, the incentive to ensure a reliable service will be greater than it has ever been.

Two characteristics will bring people back to using rail: first, the knowledge that prices will be pegged—they will not rise in real terms so people will be able to plan accordingly, as my hon. Friend the Member for Surrey, East (Mr. Ainsworth) said—and secondly, reliability. Those are the two most important aspects of customer service.

Mr. Tyler

If the Chiltern line is improving its reliability, does the hon. Gentleman accept that it is the exception that proves the rule? The figures published just two weeks ago showed that the reliability factors had deteriorated markedly on a national basis while privatisation has hung like a threat over the industry.

Mr. Smith

We are in a transitional period, as is inevitable with any privatisation. Of course the Opposition always exploit the situation. Once the process is complete, the service will improve. Management will have a major incentive to improve reliability because it is the key characteristic of a railway service. For that reason, I support the Government's proposals.

6.10 pm
Ms Glenda Jackson (Hampstead and Highgate)

I declare an interest as I am sponsored by the rail drivers' union, the Associated Society of Locomotive Engineers and Firemen. I regret that the Secretary of State is not in his place. That he chose to approach this debate with a marked lack of gravity and seriousness, demeaned not only himself and the great office of state that he holds—although that is of no particular consequence—but a great industry and thousands of dedicated people who, in many instances, gave their lives in its service. I regret that he is not present to hear what I say, but no doubt he will be able to read it in the Official Report.

The hon. Member for Beaconsfield (Mr. Smith) referred, as did his hon. Friend the Member for Hertsmere (Mr. Clappison), to the capping of rail fares. I find it ironic that Conservative Members have attempted to present the capping of rail fares as anathema to Opposition Members. During Transport questions in January 1993, the then Minister for Public Transport, the right hon. Member for Kettering (Mr. Freeman), said in response to a question of mine that if I wished to see fare increases moderated and reduced, it would mean the taxpayer having to provide more money for subsidies to British Rail".—[Official Report, 11 January 1993; Vol. 216, c. 597.] He said that the difference between the Opposition and the Government was that the Government believed that rail passengers should pay the real fare for travelling on railways. I have no doubt that that reply was cheered to the echo by Conservative Members.

Yesterday, the minimum service standards that will be required of potential private rail operators were announced. The House will recall that the concept of minimum service standards was proudly trumpeted by the Secretary of State for Transport as a guarantee of levels of service to rail passengers for the very first time. However, when it was pointed out to him that those standards would lead to a 20 per cent. reduction in current service levels, the right hon. Gentleman attempted to reassure the public by saying that those minimum standards would not in fact ever be implemented. The Secretary of State must be one of the first politicians to have sought to convince people of the merits of his policy by pledging that it would never see the light of day.

This week we have again seen Ministers' efforts at describing the utopia set to greet rail passengers once they board the great rail privatisation express undermined by that boring old killjoy reality. The Prime Minister pledged in the House that rail privatisation would lead to better services for passengers. But if the standards outlined by the Secretary of State were ever to be implemented—perhaps the hon. Member for Castle Point (Dr. Spink) could inform his hon. Friend the Member for Basildon (Mr. Amess) of this fact as he is clearly not aware of it—peak services from Basildon to London would be cut by almost 60 per cent., peak services from Reading to London would be cut by almost 50 per cent. and Epsom commuters would face peak services cuts of 67 per cent.

This week's announcement on service levels was a disaster for the passengers who rely on Britain's rail network. The assault on the hard-pressed commuter, however, did not end with the publication of the passenger service requirement. Today, the franchising director published his invitations to tender. As the departing British Rail chairman Sir Bob Reid pointed out, an invitation to play a part in what is fast becoming the most shambolic privatisation of the past 16 years will be regarded by many as the most unwelcome invitation since the spider threw open his parlour to the fly.

In that document of invitations, potential bidders were warned about the London travelcard. It said: Should London Underground, and/or any relevant bus operator introduce competing travelcards which do not include the option of travel on rail services, this may have a detrimental effect on their"— the potential bidders— revenue". That same travelcard, which Ministers were pledging last year would be safe from rail, bus or even tube privatisation, could, according to the franchising director, be facing the axe, with the result that rail commuters will no longer be able to integrate their travel with the rest of the public transport system. Are Ministers also claiming that the abolition of the London travelcard and other travelcards around the country will constitute an improved service for commuters?

I cited the Secretary of State for Transport and his pledge that privatisation would lead to an improved and guaranteed quality of service. I wonder if, since he made that comment, he has had a chance to speak to his right hon. Friend the Member for St. Albans (Mr. Lilley). Last month, I had the pleasure of visiting St. Albans and experienced in particular the local rail service which links it to Watford, known locally as the Abbey Flyer. In 1988, North London railways spent more than £675,000 electrifying the Abbey Flyer route and improving the service. When I visited it, that good work was about to be reversed. Due to shortages of rolling stock and no money to buy more, North London railways was being forced to remove the electric rolling stock from the line and replace it with old, less reliable diesel units. In addition, because of the extra costs of the new access charging regime, St. Albans council tax payers, who subsidise the Sunday Flyer service, were facing a bill for another £50,000 a year to keep it operating.

Thankfully, as a result of the campaign by the local Labour party and local commuter groups, North London railways announced last week that it had abandoned plans to replace the electric units, but the extra costs of keeping that service running will still have to be borne by the council tax payers of St. Albans and a reduction in late-night services is proposed. Elsewhere on the network, other commuters will still be rattling around behind 30 year-old diesel trains. That is the reality of rail privatisation: higher costs, for poorer services.

On Monday, the Secretary of State attempted to buy some good publicity for privatisation by announcing that he would be capping fares. As we all read in our newspapers on Tuesday, that attempt failed miserably. It did not fail because the idea was wrong in principle; there are good arguments for encouraging greater use of our public transport system by holding fares at reasonable levels. What tripped up the Secretary of State as he attempted his fares U-turn was once again the realities of the flawed rail privatisation policy that he was trying to sell.

If the Secretary of State had been seeking to cap fares in a public rail service, it would have cost approximately £35 million each year over the next three years, but, because of privatisation, that cost has leapt to more than £350 million over the same period. If one adds to that the estimated £1.25 billion overall cost of privatisation itself, one can see that instead of saving commuters' money through lower fares, the Secretary of State is costing them almost £1.5 billion in higher taxation.

That is the reality of privatisation from which the Secretary of State cannot escape. Those are the facts that cannot be hidden. At a time when hon. Members on the Back Benches behind him are desperately trying to clutch at the straws of tax cuts to save them from electoral oblivion, I humbly suggest that it will not be much longer before rail privatisation catches up with him and his Government for good.

6.19 pm
Mr. Henry McLeish (Fife, Central)

It is a pity that the Secretary of State is not in his place, because he cast a blight over the debate by refusing to take any of the issues seriously. The country and the House are not in the mood to be lectured to by a Secretary of State who is overseeing the most monumentally stupid piece of public policy since the war, overseeing the destruction of a nationally integrated rail network and overseeing a privatisation that is nothing but a shambles.

If the privatisation were a shambles simply because the Government were not achieving any of their objectives, that would be bad enough. But the down side of the whole process is the fact that in the Government's search and in their obsession with privatisation they are causing immense damage to the fabric of the network and to the morale of the people who work in it.

It is extraordinary that when the Secretary of State was asked earlier how much his policy would cost, he simply did not know. That is a rich irony. The first cheque book is being taken out and the price is no object. The Government are saying that there is no price that they will not pay to implement that crazy privatisation process. If that is not irresponsible I do not know what is.

In Scotland we say that a person has "a guid conceit of himself", and it is ludicrous for a Secretary of State, who comes to the Dispatch Box to lecture us on a failing policy, to act in such a patronising manner. That is unforgivable, and I hope that if the Secretary of State does not arrive in time for the remainder of the debate, he will at least read the Official Report tomorrow.

As my hon. Friend the Member for Hampstead and Highgate (Ms Jackson) has said, the real tragedy is that of the men and women who work in the rail industry. Is it not sad that no one on the Government Benches is willing to raise the morale of those people by saying that they are doing a good job? We hear many comments about the failures of nationalisation over the past 50 years, and of course we do not have a perfect rail network. But surely there is a difference between saying that, and failing to give credit where it is due to the management and the work force of that great industry.

In the time available I shall concentrate on the evidence that we are submitting about the shambles and the mess that the Government have got themselves into. The passengers of this country, the people of this country—and, at some time in the future the electors of this country—will want to see that evidence.

The first great debacle was about the sleeper services. Is it not amazing that Government policy is now shaped in the courts rather than on ministerial desks? Why is there so much buck-passing, and why will no one take responsibility for anything? The Government tried to con the Scottish people over the costs, the local authority appealed and the matter is now before the courts. The British Railways Board's appeal will be heard on 1 June. I hope that British Rail will now withdraw its appeal. It must start listening to the travelling public instead of to the Government, because the Government are hell-bent on destroying the network. Surely the British Railways Board is the custodian charged with the responsibility of ensuring that the network continues.

As if the court case about the sleepers were not bad enough, my hon. Friend the Member for York (Mr. Bayley) has highlighted the tragedy of ABB. He asked the Government a simple question: why do they not intervene? The Secretary of State says that he is willing to pay any price for subsidies to put into franchises, but when we ask him to restore the domestic market for rolling stock, he does not care.

Of course we would not wish to use such a subsidy. As my hon. Friend said, the affair involves not subsidies but future leasing costs. The Government stand condemned for having put 750 people out of work, and they simply do not care. I challenge the Minister for Railways and Roads, when he replies, to tell the House why he does not care. But perhaps he will surprise us by telling us that he does care. If so, will he now order the British Railways Board to specify rolling stock requirements that will at least allow ABB to be a player in the domestic market? The whole business is a disgrace, and my hon. Friend has eloquently made the case for his local area.

The franchises are the third cause for concern. This morning the franchising director heralded a new dawn, and the Secretary of State said that we were now genuinely moving forward on privatisation. But that is late too. If those franchises go ahead—there is no guarantee that they will—they will not be operable until next year. We were promised that 51 per cent. of the franchises for the 25 train operators would be completed by May 1996. Once again, the timetable is in disarray. The Minister may want to give excuses and explain why the programme will not meet the targets. Now that the 51 per cent. has disappeared, what new target will the Government set?

The other issue is safety. How many logs are regularly leaked from Railtrack revealing that trains are still going through danger signals on to single tracks? We are spending £1.25 billion on the nonsense of privatisation, yet passenger safety is at risk throughout the country because of a lack of investment. Let us forget the politics; there is a huge moral issue at stake here. Can we let people travel on our railways in certain parts of the country when we are not employing proper safety procedures because the Government, like a drunken sailor, want to squander money on privatisation and politics rather than on people and safety? That is the issue that the Minister should deal with this evening. [Interruption.] I heard the hon. Member for Hertford and Stortford (Mr. Wells) say, from a sedentary position, "Humbug." I want it to be recorded in Hansard that the people who sit on the Conservative Front Bench think that the issue of safety is simply humbug—[Interruption.] And I want it recorded that not only was safety described as humbug, but there was then a systematic bout of laughter.

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

What the record should show, Mr. Deputy Speaker, is that my normally silent hon. Friend was describing the hon. Gentleman's argument rather than the importance of safety on the railways.

Mr. McLeish

The Minister's attempt to rescue the situation will also be recorded in Hansard as a dismal failure.

Apart from safety, the main issue that the Secretary of State dwelt on today was fares. I am pleased to see that the right hon. Gentleman has now returned to the Chamber. When the Government announced fare capping this week they thought that they would get a good press. But in every editorial in the quality newspapers the Secretary of State was hung, drawn and quartered—[Hon. Members: "No."] I suggest that Conservative Members read the editorials before commenting from a sedentary position.

It is right that the Government should be pilloried, because their fare capping is a con. We now know that only 50 per cent. of the fares in Britain will be regulated, and it is important to realise which fares will not be subject to regulation. They are: all first-class fares, cheap day returns, supersavers, Advance, Super Advance, Apex, Super Apex, Shuttle Advance, Shuttle Superadvance, and Network Awaybreak and Network Stayaway, which operate in the south-east.

So now we know that that great fare-capping initiative was a political exercise designed to silence the powerful arguments of commuters throughout the country, some of whom voted Conservative at the last general election, although they may not do so next time. We know that 50 per cent. of the fares paid by the travelling public will not be covered by the capping scheme.

The Secretary of State's performance when he was asked to tell the House how much the extra subsidy would cost was worrying. How often have the Opposition heard the Government say, "What would Labour do?", "Isn't that a spending commitment?" and, "Won't that mean an increase in taxation?" What hypocrisy. What humbug—to coin a phrase. We now know, partly from what he said today, that the Secretary of State has apparently been given an open cheque book. There is no subsidy that he will not pay.

It is important to challenge the right hon. Gentleman again on that issue. Will the cost be £300 million over seven years? Will it be £400 million, or £500 million? The answer is simple: the cost does not matter to the Government. The privatisation policy is in such free fall that the Government are willing to use any part of the taxpayers' contribution to bail it out. The Government should be wary of using "tax and spend" as an attack on us in the future. The Secretary of State came to the Dispatch Box, allowed himself to be drawn into an issue and failed to rescue himself. He did not address the central question of what it will cost to ensure that the privatisation takes place.

Another issue of grave concern is the passenger service requirements. These were introduced with a fanfare of publicity, and the Government thought that they would get credit for them. But there are three passenger service requirements now confirmed, and we find that 15 per cent. to 20 per cent. of all services are to be axed. The Secretary of State says that that will provide the minimum, and that the commercial entrepreneurs lurking out there who are desperate to get their hands on a franchise will deliver improved services. Not only will they reinstate that 15 per cent. to 20 per cent., they will give us more services. That is a policy on a wing and a prayer which does not satisfy any of the passengers.

Mr. Nigel Forman (Carshalton and Wallington)

Is the hon. Gentleman aware of the parallel with British Airways which moved from the public to the private sector and began to expand its services in both range and quality?

Mr. McLeish


Dr. Mawhinney

He does not want to know the truth.

Mr. McLeish

The Secretary of State may say that, but let me address the comparison between this privatisation and any of the others. The Government took British Rail and smashed it into 95 pieces. They now want to sell all of the individual pieces under the guise of a nationally integrated rail network. One does not have to be a genius to work out that this privatisation bears no relationship to any other.

If one believes in the privatisation of British Rail—I do not—one must see that the Government could not have picked a worse method. Not only are they ideologically wrong, they have picked a method which beggars belief. No one can understand why, after going down the privatisation road, the Government then have sought to sabotage it by picking the silliest way possible to privatise.

The question of the invitation to tender was raised by several of my hon. Friends. This matter is seen by the Secretary of State as the start to the privatisation. It is important for this House, the press and the public to understand that this is all being done in secrecy. The Treasury's rules of commercial confidence mean that the director of franchising, Roger Salmon, has £2.1 billion tucked away. Vital services in three franchises are now going out to tender and the issue will be debated behind closed doors.

The British Railways Board did not even get the tender documentation which went out with the bids. It only runs the service at present, so obviously that was an oversight. The fact is that this is being done in secrecy, and the Minister should explain that to the House when he replies. Are we so concerned about whether Brian Souter of Stagecoach might bid l0p or 50p more than someone else when we come to consider ScotRail? The answer is obvious. The Government simply do not want anyone to look into a process which is a major mess.

If one thing above all characterises this privatisation, it is the question of buck-passing. One of the issues which concerns the Labour party, and I am sure the Liberal Democrats, is that of who takes responsibility. The Secretary of State seems to try to work it out on this basis. If he is dealing with an unpopular issue—such as fares—he will not only jump on the director of franchising, but will allow himself to be attacked by the Prime Minister, who has read material on the matter on the way back from Paris. If it is a sensitive issue and the politics are important enough, the Secretary of State will intervene.

If the issue is the Fort William sleeper service, on the other hand, does the Secretary of State really care? A judgment is made. He says, "It is a sleeper service on the periphery of the country which costs £2.5 million on the Government's figures. I will not intervene." We have the director of franchising, the rail regulator, the Minister responsible for railways, the Secretary of State for Transport and the Secretary of State for Scotland, but no one wants to take responsibility. That is shirking responsibility, and the Secretary of State should say whether he is in charge of his transport brief or whether his is only a selective responsibility when the issue suits his purposes.

In my possession I have the Great Britain passenger rail timetable. This will be a collector's item soon. But to add poignancy to the points which I have made this evening, the front cover of the timetable contains tracks, but no trains. That is a significant comment on where we are going. I ask the Minister to start to address the issues and to ignore the politics and the ideology of this crazy adventure.

When will someone in the Government have the courage to dump this whole exercise? How much taxpayers' money has to be squandered? How many jobs—such as those at ABB—will have to go? How many services do we have to lose? How much manipulation of British Rail accounts will be needed to soften and sweeten parts of the industry? What are the Government doing about Railtrack behind the scenes to fatten it up? [Interruption.] The Secretary of State winked at that point, which is significant.

If common sense prevails, the privatisation should end. We will work towards that, and I shall finish on a buoyant note. The Government are making such a hash of their own programme that I believe that there will be very little for us to deal with in terms of what has been moved into the private sector. That will be important when we take over in government in 18 months or two years' time.

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

May I begin by reassuring the hon. Member for Fife, Central (Mr. McLeish) that the Great Britain timetable will continue in the privatised railway?

The Labour party has pursued rail privatisation policy through three debates of its own choosing rather like a hunt looking for a fox that finds that all the foxes have been shot. First came the scare about through ticketing; then came the wild allegations that passenger service requirements would lead to the decimation of services. Labour's motion today states that the threat of rail privatisation is leading to a "blight of investment".

Let us examine the facts. If the prospects of privatisation were blighting investment, we would expect to see that reflected in investment expenditure since we embarked on the process of preparing for privatisation. Figures show that in each of the past four years—a reasonable period in which to consider preparations for the privatisation programme—under this Government investment has been higher than in any year under the previous Labour Government. The average under that Labour Government between 1974 and 1978–79 was £924 million a year.

Mr. McLeish

Is that at today's prices?

Mr. Watts

Yes. I am not using any accountant's sleight of hand by not taking account of inflation.

In the past four years, investment expenditure has been: in 1990–91, £1,216 million; in 1991–92, £1,442 million; in 1992–93, £1,552 million; and in 1993–94, £1,188 million. That makes an average of £1,350 million in each of those years. The increase in real terms in average spend when comparing those four years with the last four years of the previous Labour Government is 46 per cent.

Mr. Meacher

Will the Minister give the figures excluding channel tunnel and European Passenger Services expenditure? Will he confirm that over the past four years there has been a steady decline in expenditure on the existing rail network, which, if we take into account expenditure this year, is about half what it was in real terms four years ago?

Mr. Watts

The hon. Gentleman has a strange idea of what constitutes a real railway. Does he suggest that the improved facilities between London and the channel tunnel are not part of the real rail infrastructure? One can exclude from an argument anything that is detrimental to one's own argument, but regular users of Eurostar and businesses that use freight services through the channel tunnel know all too well that the investment, which the hon. Gentleman rightly says includes investment to improve continental services through the channel tunnel, is very much real investment and it has led to real infrastructure.

I was asked about the current position. In 1994–95, investment was sustained at more than £1 billion and it continues at that level in the current year. My right hon. Friend the Secretary of State was asked how much Railtrack is investing. In the current year, Railtrack's investment programme is £625 million, an increase of 10 per cent. over the previous year. The Government need no lectures from the Opposition about the investment needs of the railway.

Dr. John Reid (Motherwell, North)

I know that the Minister is honest and straightforward so I shall take his statistics at face value. I simply want to be clear about what he is telling the British people. Is he telling them, contrary to what we say, that the Government are spending more of their money to invest more in the railways in order that, when they are privatised, they will make more money, which will go back to the private sector? Is that what he is boasting about?

Mr. Watts

No. What I am boasting about, if "boasting" is the right term, is that, in the years of preparation for privatisation, which the Opposition's motion claims has been blighting investment, we have spent—

Dr. Reid

No, you have not. The taxpayers have spent.

Mr. Watts

The hon. Gentleman is right to make that point. Taxpayers, through the Government, have been providing British Rail and Railtrack with expenditure that is on average 46 per cent. up in real terms compared with the period when Labour was last in government.

Dr. Reid


Mr. Watts

I cannot give way again as I must seek to reply to a number of points.

A key feature of the privatisation policy is that the privatised railway, freed from public expenditure constraints—although they have not been as constraining as they were under the last Labour Government—will have access to the private sector to raise funds for investment. That will be important both for Railtrack and the rolling stock leasing companies.

I know that Opposition Members have an antipathy to looking at the success of privatisation policies, so I shall give them just one example. There is every realistic expectation that, after privatisation, investment will be higher. I refer Opposition Members to BAA, our airport operator, which, every year since it has been in the private sector has invested on average three times as much as it did when it was in public ownership.

The hon. Member for York (Mr. Bayley) referred to the proposed closure of the ABB works at York. I pay tribute to the hon. Gentleman, to my hon. Friend the Member for Ryedale (Mr. Greenway) and to my right hon. Friend the Member for Selby (Mr. Alison) for their efforts to ensure that their constituents who work at ABB would have the prospect of future work. I hope that the hon. Member for York will be generous enough to acknowledge that I have not been an entirely passive observer of those events. He will know that in March, although British Rail had concluded that it had no pressing commercial need to order further rolling stock, in recognition of the order position facing the manufacturing industry it issued an invitation to tender to ABB and to GEC Alsthom for a further supply of Networker trains for Kent services. Tenders are due in from those two manufacturers on 26 May.

The hon. Member for York will recognise that one reason why British Rail was prepared to offer such an invitation to tender was that it recognised the problems facing the industry and was aware of the concerns that the hon. Gentleman and my right hon. and hon Friends had been expressing on behalf of their constituents. However, no manufacturer can expect the right to supply what it wants to supply when it wants to supply it, regardless of the customer's requirements. British Rail does not want to order trains identical to those currently being constructed under the special £150 million leasing deal put together last year. Moreover, ABB must compete for whatever contracts are available in the marketplace. Part of ABB's problem is that it has failed to win enough of the contracts in the marketplace to secure the work load that it needs.

I know that we shall have a further opportunity to debate those issues next week in a debate which the hon. Member for York has requested, so I shall not go into further detail now. I must move on to other points.

Matters related to the creation of alternative employment opportunities, although not primarily a matter for my Department, will certainly be of concern to other Departments and I shall discuss with my ministerial colleagues in the relevant Departments the hon. Gentleman's point about the need to address employment problems in York.

Mr. Bayley

I acknowledge that the Minister put pressure on British Rail to seek tenders for orders in March, but does he acknowledge that that was too late? Last May, the Minister's predecessor, the right hon. Member for Kettering (Mr. Freeman), attended the York Rail Forum. He said: There is a prima facie case for Kent Coast rolling stock.… in the period July-September 1994 the question of who places the order and who owns the stock and the train operating lease will be resolved. Does the Minister recognise that, had the Government stuck to the timetable set down by the then Minister of State, we would not now have the crisis that has led to the closure of the York works?

Mr. Watts

As I have just explained, that would depend partly on whether ABB was successful in securing the order. Frankly, one of the major problems that ABB has faced is its failure to secure the orders that are available—for example, the order for Northern line trains worth £400 million, which was placed earlier this year, and last year the contract for the supply of Heathrow Express trains.

The hon. Member for Fife, Central expressed his concerns about passenger services. He seemed to think that there was something sinister about invitations to tender. He will be aware that there is no secrecy about passenger service requirements, which set out the guaranteed services for passengers. Invitations to tender are a matter of commercial negotiation but there is nothing sinister about that. Yesterday's announcement of the final PSRs for the first three franchises following consultation show that the consultation process on passenger service requirements is genuine.

The franchising director has announced a number of improved specifications to provide better services to passengers. For example, on the Great Western line, direct services are now to be specified from Reading and Swindon to Chippenham, Bath, Bristol and Cardiff. That will be welcome news to many of my right hon. and hon. Friends. Similar arrangements will be made for services to Didcot. Additional safeguards are being provided for first and last trains, such as an early-morning arrival at Exeter. Maximum journey times are to be tightened and there is to be at least one "flagship" service both from south Wales and the west country, meeting the current best performance times.

As well as the rigorous requirements set out by the franchising director, Great Western Trains has announced that it is introducing an additional early-morning train from Penzance to Paddington with the introduction of the new summertime timetable. The night riviera sleeper service will now run to Waterloo to provide connections with Eurostar.

Mr. Tyler


Mr. Watts

I am sorry, I cannot give way because I am pressed for time.

The times of the first and last trains on South West Trains have been adjusted to provide earlier and later services. Stops on certain services have been guaranteed at Vauxhall, Clapham Junction, Wimbledon and Woking to facilitate connections to airports and London Underground. Seating capacity has been specified on peak period services from Salisbury to Exeter and from Reading. Extra connections have been specified at Basingstoke for the last train from Exeter. There will be an extra Sunday service from London to Exeter and an extra early morning arrival at Weymouth.

My hon. Friend the Member for Castle Point (Dr. Spink) expressed his confidence that the improved services for his constituents will encourage more people to travel by train. He is right that they will be attracted by real terms reductions in fares over the next seven years. He may be interested to know that I shall visit the London-Tilbury-Southend line tomorrow morning. My hon. Friend reminded us that services for his constituents have improved because of a £150 million investment in new signalling and the prospect of new rolling stock.

My hon. Friend the Member for Castle Point will be aware that the passenger service requirement announced yesterday provides improved safeguards for first and last trains on every route and full frequency services to Limehouse, which will provide an interchange with the docklands light railway. The PSR provides a new obligation on the Ockenden to Tilbury service to connect with the Tilbury ferry. [Interruption.] I am sorry if Opposition Members find the details of those service improvements boring, but as they continually claim that services are to be decimated it is important to set the record straight.

My hon. Friends the Members for Basildon (Mr. Amess), for Castle Point and others who represent Essex will also know that the new summer timetable, to be introduced later this month, will provide additional services between Upminster and Grays, which will serve the new station at Chafford Hundred. Their constituents will therefore have the environmentally friendly option of shopping at Lakeside and travelling there by train rather than having to use their cars.

Dr. Reid

What about toilets?

Mr. Watts

I have described improvements in services to passengers, but the hon. Gentleman asks me about toilets. I leave hon. Members to draw their own conclusion from that.

In addition to the new services I have mentioned, the new summer timetable includes several new services—for example, an hourly service from south Humberside to Doncaster, Sheffield and Manchester airport. That will operate in addition to the existing extensive range of rail connections to Manchester. New direct services will run from Brighton to Lewes, Eastbourne, Hastings and Ashford. They will provide direct connections with Eurostar trains when the international station at Ashford is open next year.

Mr. McLeish

Will Minister give way?

Mr. Watts

No, I cannot.

A through service will operate from Tunbridge Wells and Tonbridge to Redhill, Croydon and Victoria. A through service will also operate from Brighton, Worthing, Chichester and Havant to Fareham, Winchester, Basingstoke and Reading, which provides a practical and environmentally friendly alternative to using the M25 and A27.

Those improvements to PSRs and the additional services that are being introduced by British Rail create a different picture from that painted by Opposition Members. Far from being a rundown and running down railway system, it suggests a railway system that is gearing up to meet the opportunities and challenges of privatisation, and doing so with enthusiasm. I believe that managers in the railways and those who work on the railways—it is right to record our thanks to them for the sterling work that they have done for many years—will seize those new opportunities with great enthusiasm.

My hon. Friend the Member for Beaconsfield (Mr. Smith) recognised that there will be opportunity and incentive to develop services further and thus to increase revenue. That is how the private sector will respond.

My hon. Friend the Member for Hertsmere (Mr. Clappison) was right to welcome the new fares policy, on behalf of his constituents, which was spelt out earlier this week. Much to the embarrassment of Opposition Members, he reminded the House of the Labour Government's contrasting and appalling record on rail fares. He also raised the important issue of car parking at Radlett and other stations in his constituency. I am sure that his comments will be noted by British Rail and, more particularly, by those in the private sector who may eventually bid for the franchise.

The hon. Member for Fife, Central claimed that few fares would be controlled. In the course of a week, Opposition Members have gone from speaking about 100 per cent. control to little control. If the Opposition Front-Bench spokesman is right that few fares will be controlled, how can his hon. Friend the Member for Hampstead and Highgate (Ms Jackson) be right when she suggested that the cost of keeping down a small number of fares could lead to an extra subsidy of £350 million a year?

Mr. McLeish

Will the Minister confirm that 50 per cent. of the rail network will be unregulated? Will he also confirm the extent of subsidy to finance fare capping? The Secretary of State managed to avoid answering that question.

Mr. Watts

The proportion of fares controlled on each line will vary from line to line. It will also vary as between the amount of revenue that is controlled and the number of journeys subject to control. The policy is to control key fares for commuters and other users rather than to regulate every fare. The hon. Gentleman will understand that, for example, if the saver fare is controlled, that will set a limit on the extent to which the cheaper and more heavily discounted, but more restricted fares can also be increased. If there was no significant differential between a saver and a supersaver, why would any passenger want to buy a supersaver? It is not necessary to control every fare to achieve broad regulation of fares across the railways.

Opposition Members must understand that the amount of subsidy will depend on the competitive bidding process in the letting of franchises. Unlike a monolithic nationalised industry, where increasing a subsidy merely means money is poured into a bottomless pit, competition between rival operators to secure the right to run rail services will effectively put a cap on the demands made for subsidy.

As my hon. Friend the Member for Beaconsfield reminded us, private sector operators will be looking for every opportunity to increase their revenue which, in itself, will reduce their demands for subsidy. They will not go to the franchising director and, like Oliver Twist, ask for more. They will seek to pitch their bids for subsidy at a level that secures for them the right to operate the services that they find attractive.

We are implementing a policy to arrest the long-term decline of the railway industry that we have seen ever since it was nationalised. From the Labour Government of 1964 to today, the proportion of passengers carried on the railways has reduced by 2 per cent. a decade. My hon. Friend the Member for Beaconsfield stressed the need for a new structure. That was not a criticism of the people who have worked in the railway industry through the dark days of nationalisation, but a recognition of the fact that the existing structure has failed them.

The Labour party may have buried clause IV in favour of voter-friendly language about the market economy, but its commitment to state ownership and control remains clear in the motion that it has tabled today. The command economy may be dead in eastern Europe, but it is alive and kicking in Walworth road.

Question put, That the original words stand part of the Question:—

The House divided: Ayes 255, Noes 279.

Division No. 150] [6.59 pm
Abbott, Ms Diane Benn, Rt Hon Tony
Allen, Graham Bennett, Andrew F
Alton, David Benton, Joe
Anderson, Donald (Swansea E) Bermingham, Gerald
Anderson, Ms Janet (Ros'dale) Berry, Roger
Armstrong, Hilary Betts, Give
Ashdown, Rt Hon Paddy Blair, Rt Hon Tony
Ashton,Joe Boateng, Paul
Austin-Walker, John Bradley, Keith
Banks, Tony (Newham NW) Bray, Dr Jeremy
Barnes, Harry Brown, Gordon (Dunfermline E)
Barron, Kevin Brown, N (N'c'tle upon Tyne E)
Battle, John Bruce, Malcolm (Gordon)
Bayley, Hugh Burden, Richard
Beckett, Rt Hon Margaret Caborn, Richard
Beggs, Roy Callaghan, Jim
Beith, Rt Hon A J Campbell, Mrs Anne (C'bridge)
Bell, Stuart Campbell, Menzies (Fife NE)
Canavan, Dennis Howarth, George (Knowsley North)
Chidgey, David Howells, Dr. Kim (Pontypridd)
Chisholm, Malcolm Hoyle, Doug
Church, Judith Hughes, Kevin (Doncaster N)
Clapham, Michael Hughes, Robert (Aberdeen N)
Clark, Dr David (South Shields) Hughes, Roy (Newport E)
Clarke, Eric (Midlothian) Hughes, Simon (Southwark)
Clarke, Tom (Monklands W) Hutton, John
Clelland, David Illsley, Eric
Clwyd, Mrs Ann Ingram, Adam
Coffey, Ann Jackson, Glenda (H'stead)
Cohen, Harry Jackson, Helen (Shefld, H)
Connarty, Michael Jamieson, David
Cook, Frank (Stockton N) Janner, Greville
Cook, Robin (Livingston) Johnston, Sir Russell
Corbett, Robin Jones, Barry (Alyn and D'side)
Corbyn, Jeremy Jones, Jon Owen (Cardiff C)
Cousins, Jim Jones, Lynne (B'ham S O)
Cummings, John Jones, Martyn (Clwyd, SW)
Cunliffe, Lawrence Jowell, Tessa
Cunningham, Jim (Covy SE) Kaufman, Rt Hon Gerald
Cunningham, Rt Hon Dr John Keen, Alan
Dalyell, Tam Kennedy, Charles (Ross,C&S)
Davidson, Ian Kennedy, Jane (Lpool Brdgn)
Davies, Bryan (Oldham C'tral) Khabra, Piara S
Davies, Rt Hon Denzil (Llanelli) Kilfoyle, Peter
Davies, Ron (Caerphilly) Kirkwood, Archy
Denham, John Lestor, Joan (Eccles)
Dewar, Donald Lewis, Terry
Dixon, Don Litherland, Robert
Donohoe, Brian H Livingstone, Ken
Dowd, Jim Lloyd, Tony (Stretford)
Dunnachie, Jimmy Loyden, Eddie
Dunwoody, Mrs Gwyneth McAllion, John
Eastham, Ken McAvoy, Thomas
Enright, Derek McCartney, Ian
Etherington, Bill McCrea, The Reverend William
Evans, John (St Helens N) Macdonald, Calum
Ewing, Mrs Margaret McFall, John
Fatchett, Derek McKelvey, William
Field, Frank (Birkenhead) Mackinlay, Andrew
Flynn, Paul McLeish, Henry
Forsythe, Clifford (S Antrim) Maclennan, Robert
Foster, Rt Hon Derek McMaster, Gordon
Foster, Don (Bath) McNamara, Kevin
Foulkes, George MacShane, Denis
Fraser, John Madden, Max
Fyfe, Maria Maddock, Diana
Galbraith, Sam Maginnis, Ken
Galloway, George Mahon, Alice
Gapes, Mike Mandelson, Peter
Garrett, John Marek, Dr John
Gerrard, Neil Martin, Michael J (Springburn)
Gilbert, Rt Hon Dr John Martlew, Eric
Godman, Dr Norman A Meacher, Michael
Godsiff, Roger Michael, Alun
Golding, Mrs Llin Michie, Bill (Sheffield Heeley)
Gordon, Mildred Michie, Mrs Ray (Argyll & Bute)
Graham, Thomas Milburn, Alan
Grant, Bernie (Tottenham) Miller, Andrew
Griffiths, Nigel (Edinburgh S) Morgan, Rhodri
Griffiths, Win (Bridgend) Morley, Elliot
Grocott, Bruce Morris, Rt Hon Alfred (Wy'nshawe)
Hain, Peter Morris, Estelle (B'ham Yardley)
Hall, Mike Morris, Rt Hon John (Aberavon)
Harvey, Nick Mowlam, Marjorie
Hattersley, Rt Hon Roy Mudie, George
Henderson, Doug Mullin, Chris
Heppell, John Murphy, Paul
Hill, Keith (Streatham) Oakes, Rt Hon Gordon
Hinchliffe, David O'Brien, William (Normanton)
Hodge, Margaret O'Hara, Edward
Hoey, Kate Olner, Bill
Hogg, Norman (Cumbernauld) O'Neill, Martin
Hood, Jimmy Orme, Rt Hon Stanley
Hoon, Geoffrey Parry, Robert
Pearson, Ian Soley, Clive
Pendry, Tom Spearing, Nigel
Pike, Peter L Spellar, John
Pope, Greg Squire, Rachel (Dunfermline W)
Powell, Ray (Ogmore) Steel, Rt Hon Sir David
Prentice, Bridget (Lew'm E) Steinberg, Gerry
Prentice, Gordon (Pendle) Stevenson, George
Prescott, Rt Hon John Stott, Roger
Primarolo, Dawn Strang, Dr. Gavin
Quin, Ms Joyce Sutcliffe, Gerry
Randall, Stuart Taylor, Mrs Ann (Dewsbury)
Raynsford, Nick Taylor, Matthew (Truro)
Reid, Dr John Timms, Stephen
Rendel, David Touhig, Don
Robertson, George (Hamilton) Tyler, Paul
Robinson, Geoffrey (Co'try NW) Vaz, Keith
Roche, Mrs Barbara Walker, Rt Hon Sir Harold
Rogers, Allan Wallace, James
Rooker, Jeff Walley, Joan
Rooney, Terry Wareing, Robert N
Ross, Ernie (Dundee W) Watson, Mike
Rowlands, Ted Wicks, Malcolm
Salmond, Alex Wigley, Dafydd
Sedgemore, Brian Williams, Rt Hon Alan (Sw'n W)
Sheerman, Barry Williams, Alan W (Carmarthen)
Sheldon, Rt Hon Robert Wilson, Brian
Shore, Rt Hon Peter Winnick, David
Short, Clare Wise, Audrey
Simpson, Alan Worthington, Tony
Skinner, Dennis Wray, Jimmy
Smith, Andrew (Oxford E) Wright, Dr Tony
Smith, Chris (IsI'ton S & F'sbury) Young David (Bolton SE)
Smith, LIew (Blaenau Gwent) Tellers for the Ayes:
Smyth, The Reverend Martin Mr. Stephen Byers and
Snape, Peter Mr. Robert Ainsworth.
Ainsworth, Peter (East Surrey) Burt, Alistair
Aitken, Rt Hon Jonathan Butcher, John
Alison, Rt Hon Michael (Selby) Butler, Peter
Allason, Rupert (Torbay) Butterfill, John
Amess, David Carlisle, John (Luton North)
Arbuthnot, James Carlisle, Sir Kenneth (Lincoln)
Arnold, Jacques (Gravesham) Carrington, Matthew
Arnold, Sir Thomas (Hazel Grv) Carttiss, Michael
Ashby, David Cash, William
Atkins, Robert Channon, Rt Hon Paul
Atkinson, David (Bour'mouth E) Chapman, Sydney
Atkinson, Peter (Hexham) Clappison, James
Baker, Rt Hon Kenneth (Mole V) Clark, Dr Michael (Rochford)
Baker, Nicholas (North Dorset) Clifton-Brown, Geoffrey
Baldry, Tony Coe, Sebastian
Banks, Matthew (Southport) Colvin, Michael
Batiste, Spencer Congdon, David
Bellingham, Henry Conway, Derek
Bendall, Vivian Coombs, Anthony (Wyre For'st)
Beresford, Sir Paul Cope, Rt Hon Sir John
Biffen, Rt Hon John Cormack, Sir Patrick
Booth, Hartley Couchman, James
Boswell, Tim Cran, James
Bottomley, Peter (Eltham) Currie, Mrs Edwina (S D'by'ire)
Bottomley, Rt Hon Virginia (SW Surrey) Curry, David (Skipton & Ripon)
Davies, Quentin (Stamford)
Bowden, Sir Andrew Davis, David (Boothferry)
Bowis, John Day, Stephen
Boyson, Rt Hon Sir Rhodes Deva, Nirj Joseph
Brandreth, Gyles Devlin, Tim
Brazier, Julian Dicks, Terry
Bright, Sir Graham Dorrell, Rt Hon Stephen
Brooke, Rt Hon Peter Douglas-Hamilton, Lord James
Brown, M (Brigg & Cl'thorpes) Dover, Den
Browning, Mrs Angela Duncan, Alan
Bruce, Ian (Dorset) Duncan-Smith, Iain
Budgen, Nicholas Dunn, Bob
Burns, Simon Durant, Sir Anthony
Eggar, Rt Hon Tim Knight, Mrs Angela (Erewash)
Elletson, Harold Knight, Greg (Derby N)
Emery, Rt Hon Sir Peter Knox, Sir David
Evans, David (Welwyn Hatfield) Kynoch, George (Kincardine)
Evans, Jonathan (Brecon) Lait, Mrs Jacqui
Evans, Nigel (Ribble Valley) Lamont, Rt Hon Norman
Evans, Roger (Monmouth) Lang, Rt Hon Ian
Evennett, David Lawrence, Sir Ivan
Faber, David Legg, Barry
Fabricant, Michael Leigh, Edward
Fenner, Dame Peggy Lennox-Boyd, Sir Mark
Field, Barry (Isle of Wight) Lester, Jim (Broxtowe)
Fishburn, Dudley Lidington, David
Forman, Nigel Lightbown, David
Forsyth, Rt Hon Michael (Stirling) Lilley, Rt Hon Peter
Forth, Eric Lloyd, Rt Hon Sir Peter (Fareham)
Fowler, Rt Hon Sir Norman Lord, Michael
Fox, Dr Liam (Woodspring) Lyell, Rt Hon Sir Nicholas
Fox, Sir Marcus (Shipley) MacGregor, Rt Hon John
Freeman, Rt Hon Roger MacKay, Andrew
French, Douglas Maclean, David
Gale, Roger McLoughlin, Patrick
Gallie, Phil McNair-Wilson, Sir Patrick
Gardiner, Sir George Madel, Sir David
Garel-Jones, Rt Hon Tristan Maitland, Lady Olga
Garnier, Edward Major, Rt Hon John
Gill, Christopher Malone, Gerald
Gillan, Cheryl Mans, Keith
Goodlad, Rt Hon Alastair Marlow, Tony
Goodson-Wickes, Dr Charles Marshall, John (Hendon S)
Gorman, Mrs Teresa Marshall, Sir Michael (Arundel)
Gorst, Sir John Martin, David (Portsmouth S)
Grant,Sir A (SW Cambs) Mates, Michael
Greenway, Harry (Ealing N) Mawhinney, Rt Hon Dr Brian
Griffiths, Peter (Portsmouth, N) Mayhew, Rt Hon Sir Patrick
Grylls, Sir Michael Mellor, Rt Hon David
Gummer, Rt Hon John Selwyn Merchant, Piers
Hague, William Mills, Iain
Hamilton, Rt Hon Sir Archibald Mitchell, Andrew (Gedling)
Hamilton, Neil (Tatton) Mitchell, Sir David (NW Hants)
Hampson, Dr Keith Moate, Sir Roger
Hanley, Rt Hon Jeremy Monro, Sir Hector
Hannam, Sir John Montgomery, Sir Fergus
Hargreaves, Andrew Needham, Rt Hon Richard
Harris, David Nelson, Anthony
Haselhurst, Alan Neubert, Sir Michael
Hawkins, Nick Newton, Rt Hon Tony
Hayes, Jerry Nicholls, Patrick
Heald, Oliver Nicholson, David (Taunton)
Heath, Rt Hon Sir Edward Norris, Steve
Heathcoat-Amory, David Onslow, Rt Hon Sir Cranley
Hendry, Charles Oppenheim, Phillip
Hicks, Robert Page, Richard
Higgins, Rt Hon Sir Terence Pattie, Rt Hon Sir Geoffrey
Hill, James (Southampton Test) Pawsey, James
Hogg, Rt Hon Douglas (G'tham) Peacock, Mrs Elizabeth
Horam, John Pickles, Eric
Hordem, Rt Hon Sir Peter Porter, Barry (Wirral S)
Howard, Rt Hon Michael Porter, David (Waveney)
Howarth, Alan (Strat'rd-on-A) Portillo, Rt Hon Michael
Howell, Rt Hon David (G'dford) Powell, William (Corby)
Howell, Sir Ralph (N Norfolk) Redwood, Rt Hon John
Hughes, Robert G (Harrow West) Renton, Rt Hon Tim
Hunt, Sir John (Ravensbourne) Rifkind, Rt Hon Malcolm
Hunter, Andrew Robathan, Andrew
Jack, Michael Robinson, Mark (Somerton)
Jenkin, Bernard Roe, Mrs Marion (Broxbourne)
Jessel, Toby Rumbold, Rt Hon Dame Angela
Johnson Smith, Sir Geoffrey Ryder, Rt Hon Richard
Jones, Gwilym (Cardiff N) Sackville, Tom
Jones, Robert B (W Hertfdshr) Sainsbury, Rt Hon Sir Timothy
Jopling, Rt Hon Michael Scott, Rt Hon Sir Nicholas
Kellett-Bowman, Dame Elaine Shaw, David (Dover)
King, Rt Hon Tom Shephard, Rt Hon Gillian
Kirkhope, Timothy Shepherd, Colin (Hereford)
Knapman, Roger Shepherd, Richard (Aldridge)
Sims, Roger Townsend, Cyril D (Bexl'yh'th)
Smith, Tim (Beaconsfield) Tracey, Richard
Soames, Nicholas Trend, Michael
Spencer, Sir Derek Twinn, Dr Ian
Spicer, Sir James (W Dorset) Vaughan, Sir Gerard
Spicer, Michael (S Worcs) Viggers, Peter
Spink, Dr Robert Waldegrave, Rt Hon William
Spring, Richard Walden, George
Sproat, Iain Walker, Bill (N Tayside)
Squire, Robin (Hornchurch) Waller, Gary
Stanley, Rt Hon Sir John Ward, John
Steen, Anthony Wardle, Charles (Bexhill)
Stephen, Michael Waterson, Nigel
Stem, Michael Watts, John
Stewart, Allan Whitney, Ray
Streeter, Gary Whittingdale, John
Sumberg, David Widdecombe, Ann
Sykes, John Wilkinson, John
Tapsell, Sir Peter Willetts, David
Taylor, Ian (Esher) Wilshire, David
Taylor, John M (Solihull) Wolfson, Mark
Temple-Morris, Peter Wood, Timothy
Thomason, Roy Yeo, Tim
Thompson, Sir Donald (C'er V) Young, Rt Hon Sir George
Thompson, Patrick (Norwich N)
Thornton, Sir Malcolm Tellers for the Noes:
Thumham, Peter Mr. Bowen Wells and
Townend, John (Bridlington) Mr. Michael Bates.

Question accordingly negatived.

Question, That the proposed words be there added, put forthwith pursuant to Standing Order No. 30 (Questions on amendments) and agreed to.

MADAM SPEAKER forthwith declared the main Question, as amended, to be agreed to.

Resolved, That this House applauds the record levels of investment in the railways in recent years, including more than £6 billion over the last five years; notes that since nationalisation, despite investment of more than £54 billion in the railways, the proportion of travel undertaken by train has steadily decreased; believes that the railways will be better placed to offer an improved service in the private sector; welcomes recent announcements by the Franchising Director, which represent significant milestones on the path to a privatised railway; supports the new rail fares regime, which will see ticket prices regulated on every line in the country and will produce real fare reductions; believes that the Franchising Director's announcement struck a proper balance between the interests of the passenger and train operators; and condemns the continued failure of Her Majesty's Opposition to offer any policy to stem the relative decline in railway use.