HC Deb 20 March 2001 vol 365 cc187-9
11. Mr. Steve McCabe (Birmingham, Hall Green)

What assessment he has made of the benefits of encouraging train operators to invest in Railtrack. [152918]

The Parliamentary Under-Secretary of State for the Environment, Transport and the Regions (Mr. Keith Hill)

The Government's 10-year plan provides scope for new ways of securing private sector finance and expertise, including from train operators when that makes sense. The Strategic Rail Authority, Railtrack and the preferred bidder for the south central franchise are currently working together to establish the first such partnership.

Mr. McCabe

Does my hon. Friend accept that the fragmentation of the service and the complete split between track and train was probably one of the worst aspects of the previous Government's botched privatisation of the railways? In those circumstances, does he agree that there would be strong public support for any practical measures designed to reintegrate the structure and improve the performance, management and financial strength of the railways so that we can achieve the targets in the 10-year plan?

Mr. Hill

My hon. Friend makes a perfectly reasonable point, but I have three observations about the argument on vertical integration. First, it would reduce the autonomy of franchisees and undermine current and proposed franchises. Secondly, it would make the Rail Regulator's role more difficult. Thirdly, it could hinder the efficient operation of cross franchise operators, such as freight companies.

Mr. Don Foster (Bath)

Does the Minister agree that if Railtrack's structure is not changed, the notion of anyone investing in it is almost a joke? Given the complete chaos on our privatised railways, does the Minister believe that privatisation of the railways has created a market where "the customer is king", has led to new energy and enthusiasm in the industry and has ensured that trains are cleaner safer and a good deal faster. Is he aware that those paeans came from his Labour colleagues in the Department of Trade and Industry and the Foreign and Commonwealth Office, and does he agree with them?

Mr. Hill

It is good to see the Liberal Democrat beast waken from its slumber at last. I am sure we are all extremely grateful for that.

Under the current structure of the railway industry—notwithstanding the difficulties experienced in the aftermath of recent tragic events—there has been a significant growth in rail usage of 70 per cent. over the past three years. The train operating companies are succeeding in attracting customers, and the Government are committed—by our proposal to invest £60 billion in the system over the next 10 years through the transport plan—to increasing passenger volume on the railways by 50 per cent. That is an objective to which I believe the whole House can happily assent.

Mrs. Gwyneth Dunwoody (Crewe and Nantwich)

Has my hon. Friend read the words of the Rail Regulator this morning? Given what he has just said about vertical integration, will he tell us what plans he has to ensure that before taxpayers invest £8 billion in the system they have some indication that their wishes will be carried out, that they will be given value for money, and that they will not be simply handing large amounts of their money to private investors?

Mr. Hill

I have noted the remarks of the Rail Regulator, which the Government broadly welcome.

Through various mechanisms, the Government are working extremely closely with both the Strategic Rail Authority and Railtrack to achieve exactly the goal desired by my hon. Friend—the securing of proper value for money through the investment that the Government propose to make in the railway industry and, in due course, through Railtrack.