§ 11. Mrs. Louise Ellman (Liverpool, Riverside)What plans he has to increase the public accountability of Railtrack. [5578]
§ The Secretary of State for Transport, Local Government and the Regions (Mr. Stephen Byers)The Government have proposed that a company limited by guarantee succeed Railtrack. That would have the interests of the millions of rail passengers as its top priority.
§ Mrs. EllmanI congratulate the Secretary of State on bringing an end to the misery of the failed, privatised Railtrack, but will he explain in some more detail how the arrangements will ensure a railway system that meets the needs of the travelling public and the economy, including regional economies? Will he give a clear commitment that the modernisation of the west coast main line will proceed rapidly?
§ Mr. ByersIt is important that the No. 1 priority of any successor body to Railtrack is the need to invest in the railway network so that the operations, renewals and maintenance of the network are given the priority that they deserve. That has not been possible with Railtrack for reasons that I think the House understands. There was a clear conflict between its requirement as a public company to enhance shareholder value and investing in the network. As a company, it had to put the shareholders' interests first, which was at the heart of its difficulties as a network provider.
On the specifics of the west coast main line, the fact that Railtrack has gone into administration has not stopped the work and negotiations on its upgrade. The Government, the Strategic Rail Authority and the administrators are discussing the way forward for the upgrade, to which we remain committed. It is a vital part of the United Kingdom rail network, and we are confident that its full details will be agreed in the not too distant future.
§ Mrs. Theresa May (Maidenhead)The Secretary of State will be aware of press reports that West LB is interested in Railtrack. Given that private sector interest, will he open the process up to others and undertake to meet anyone with an active interest in putting together a bid for Railtrack or financing options for the future? If there are a number of bids, what criteria will he use to choose between them?
§ Mr. ByersI welcome the hon. Lady to her new responsibilities. I shall issue a written parliamentary reply at 3.30 pm, which will give full details on the matter. However, I am pleased to be able to respond in oral questions. We would certainly welcome other expressions of interest. One has been registered and there has been a 142 meeting with the administrator, who will initially deal with them. It is right and proper that they are given detailed consideration, as the administrator and the Government will.
In order to make our position clear, it is appropriate to indicate how we will judge those expressions of interest. We intend to publish guidelines within the next few days so that people who might be interested will know exactly what we shall look for when we approve proposals that the administrator may suggest.
§ Mrs. MayI am grateful for that reply and note that the Secretary of State's next statement on Railtrack will he issued as a written answer today rather than being made formally as an oral statement in the Chamber.
Surely the real issue is that the Secretary of State pulled the plug on Railtrack because the Government would not fund the extra £700 million, yet under his new proposals the Government will guarantee an initial £1 billion. We knew that he had trouble with his maths when he was an Education Minister, but that is ridiculous. The hon. Member for Liverpool, Riverside (Mrs. Ellman) should not hold her breath with regard to the west coast main line because the real story is that the Secretary of State's actions mean that railway improvements will be delayed and the cost of funding investment will increase. The Government will have to provide exactly the guarantees—the blank cheques—for the new structure that they claimed they had avoided offering for Railtrack. There will be no improvements for passengers and there will be higher costs for taxpayers. Is it any wonder that the press call him "bungling Byers"?
§ Mr. ByersI will address that in today's debate. The Government amendment to the Opposition motion allows us to discuss Railtrack. I shall address such matters in my contribution so that we can discuss them fully.
If the hon. Lady reads the bundle of documents that we put before the High Court, and which we have placed in the Library, she will see, and the judge agreed, that Railtrack would have had a deficit of £1.7 billion by next March. By implication, she is saying that Conservative policy would be to put that £1.7 billion into Railtrack. That confirms that there is, as we know, a big black hole at the heart of Tory financial thinking. The reality is that the company could not control costs or pay its debts; we had to take action to put the travelling public first.
The hon. Lady raises the difficulties being experienced by the travelling public. It is interesting to note the view expressed by George Muir, the spokesman for the train operating companies. When asked on "Channel 4 News" what the consequences of Railtrack being taken into administration were, he said that since the accountants have
been appointed our members are telling us that decisions are being made",that money is being made available, and that essential safety work is now being undertaken. That is happening as a result of administration. We have ensured that, through the demise of Railtrack, we will be able to build a far more effective and better railway system for the travelling public.