§ 2.39 p.m.
§ THE EARL OF KINNOULLMy Lords. I beg leave to ask the Question which stands in my name on the Order Paper.
§ [The Question was as follows:
§ To ask Her Majesty's Government, why they have not yet revealed publicly their new financial formula on which they base their decision to grant aid to a railway line, and whether they will now do so.]
THE PARLIAMENTARY UNDERSECRETARY OF STATE FOR DEFENCE, R.A.F. (LORD WINTER-BOTTOM)My Lords, there is no secret about this. These grants are calculated in respect of individual passenger services on the basis recommended by the Joint Steering Group whose Report was published as the Annex to the White Paper, Railway Policy, of November, 1967 (Cmnd. 3439). The Group recommended, and the Government accepted, that these grants must cover the full long-term costs of providing the railway service concerned. My right honourable friend the Minister of Transport then has to weigh the cost of the grant against the social 409 and economic benefits which the service would provide.
§ THE EARL OF KINNOULLMy Lords, while thanking the noble Lord for his reply, may I ask whether I am not correct in saying that Her Majesty's Government sought the views of a financial consultant who prepared a formula on which to base their grant-aided programme?
§ LORD WINTERBOTTOMMy Lords, the word "formula" suggests a series of algebraic symbols. In point of fact, the formula is Section 3 of the Paper, Cmnd. 3439, which I mentioned in my original Answer.
§ LORD POPPLEWELLMy Lords, will my noble friend say whether in the last eighteen months or so there has been a change in the formula adopted by the British Railways Board in making assessments? Will he also deny or confirm that where a branch line is showing a loss of more than 6d. per passenger mile that fact has an important bearing in the new formula?
§ LORD WINTERBOTTOMMy Lords, my noble friend is speaking with greater knowledge than I myself possess. He is a professional; I am an amateur. As regards the second part of his question, concerning a loss of 6d. per passenger mile, I will send him a written reply. As regards the first part of his question, I think he may be confusing the difference between the closure basis of costs and the grant basis, which are two different things.
§ BARONESS ELLIOT OF HARWOODMy Lords, may I ask the noble Lord (he has just said that closures and grants are not related or are two different things) whether he could ascertain from his right honourable friend why it is that in the threatened or decided closure of the Waverley Line, in which I am particularly interested, the amount of money that was voted by the Ministry as being lost on the railway was £250,000 and then, when the railway closure was announced, it was stated that the figure was £700,000 a year? Since then nobody has been able to get an explanation from either the Railways Board or the Department as to the reason for the difference between the estimates of £250,000 a year and £700,000 a year.
§ LORD WINTERBOTTOMMy Lords, this is the point I made to my noble friend. It is the difference between the closure avoidable costs, and the grant basis, full long-term costs. To try to put it simply (and I hope that I shall be able to do so), if one takes a stretch of line and stops a single service from running along it, then one saves the costs of that single service. On the other hand, if in addition along a wider length of the line, of which that stretch is a section, you run other trains, then you have to decide what the full-term costs of running on that line are. That is to say, the trains that run along the full stretch of line must cover the overheads of the British Railways Board as a whole. The consultants whom the noble Earl mentioned in fact said that the full long-term costs would have to be covered by a grant-aided section of that line. That is the difference between the closure basis, representing short-term avoidable costs, and the grant basis, representing full long-term costs.
§ BARONESS ELLIOT OF HARWOODMy Lords, in those circumstances may I ask the noble Lord whether he would be good enough to ask the Department or the Railways Board to supply to those of us who are particularly interested in the Waverley Line details of what the £700,000 includes? Is it the interest on a sinking fund, on a huge development of the railways, either in Scotland or in England—for instance, Euston Railway Station—or is it confined to the cunning costs of the section of the railway which it is proposed to close?
§ LORD WINTERBOTTOMMy Lords, I will undertake to give the noble Baroness a detailed reply.
§ LORD POPPLEWELLMy Lords, as a general principle, would my noble friend request the Railways Board to give the same information with regard to the figures they arrive at in connection with these closures? I am sure the Railways Board are absolutely right in the figures given, and if they would I give more information to the public generally when they adopt these closures it would prevent much of the uneasiness and unrest which now occurs.
§ LORD WINTERBOTTOMMy Lords, my right honourable friend is going to 411 publish a detailed statement on these factors in the New Year.
§ LORD POPPLEWELLMy Lords, I thank my noble friend.
§ THE EARL OF KINNOULLMy Lords, would the noble Lord give an undertaking to ask his right honourable friend to publish details of the cost of running lines that are not grant-aided?
§ LORD WINTERBOTTOMMy Lords, we are getting into deep water, because this is a complex situation, but may I refer the noble Earl to a Written Answer given by my right honourable friend to Mr. Keith Stainton in reply to Parliamentary Question No. 7091 on Friday. November 15? That is a full reply and we can expect a following statement early in the New Year.