HL Deb 22 July 1974 vol 353 cc1497-515

6.55 p.m.

LORD GARNSWORTHY

My Lords, the purpose of this Bill is to provide a proper system of financial support and control for the British Railways Board, so that they can continue to operate a national passenger network and maintain services essential in the public interest. There is no escaping the fact that the cost of the railways to the taxpayer is very high, and is increasing. Last year the Government paid over £170 million in cash support to British Rail, and we expect that in future they will need annual support on revenue account of the order of some £300 million. But this situation is by no means unique to this country; railways all over the world have chronic financial difficulties and to the best of my knowledge there is no large passenger railway system anywhere which is not in substantial deficit.

There have been two main attempts in recent years to put railway finances on a sound basis. In 1962, the Transport Act wrote off or suspended interest payments on most of the debt to the Government and provided for deficit grants to be paid for up to five years. The money ran out well before the end of the period, despite substantial productivity improvements achieved by way of reductions in the network and manpower. The 1968 Transport Act was the first recognition that the railways would always need some Government support. The Act therefore provided for grants for individual passenger services which were loss-making but which needed to be kept open for social reasons. It was, however, assumed by both the Railways Board and the Government that most of the system—the Inter-City services and freight—could operate commercially.

But although the railways made a small book profit for the first few years, it soon became evident that their financial position was again deteriorating. A thorough review of policy was therefore put in hand in 1972 to try to establish whether there was a viable railway network at all, and to identify what size and kind of network should be provided in the public interest. The main conclusio from this review was that rail passenger operations as a whole are basically unprofitable, and that the only way of significantly reducing the amount of support they need would be to cut down the scale of railway operations quite drastically and possibly to withdraw all rail services from whole areas of the country. The only alternative is to recognise, as this Bill does, that the railways are a public corporation, that is to say not a normal nationalised industry, which provides social and environmental benefits as well as giving an economic service, and that if the country needs a rail network of something like the present size it has to pay for it.

Clauses 3 and 4 are the heart of the Bill. They provide the basis for a comprehensive system of support by enabling the Government to place a general obligation on British Railways to provide passenger services and to compensate them for doing so. There is to be a limit on the total amount of grant which may be paid of £900 million initially, which may be increased to £1,500 million, if Parliament agrees by Affirmative Resolution, after which there would need to be fresh legislation.

The significant change made by Clause 3 is that the grant is to be paid for the whole network of passenger services and will no longer consist of a large number of specific grants for particular services. The 1968 Act system suffers from the disadvantage that it is very difficult to allocate the joint costs of track and signalling and other facilities to the many services which use them. Although there may be some individual services—for example, heavily-used long distance services between main centres, or commuter services—which could show a book profit, their so-called "profitability" is an arbitrary calculation which is determined largely by how these joint costs are shared out. Support for the whole passenger business also recognises that the bulk of the costs of providing and maintaining expensive, high quality track and signalling arises from the needs of passenger services. It would be possible to run a much lower cost railway for freight operations only, but that, of course, is not our situation.

The Bill will also assist the Board through a financial reconstruction. Clause 1 reduces the Board's debt to the Secretary of State from the present £439 million to £250 million. This reflects a change in accounting procedures whereby most investment in track and signalling will in future be charged to revenue account, not capital account as at present. It also recognises that most investment of this kind is essential replacement instead of remunerative capital investment; it is therefore sensible to write it off as it occurs and to meet much of the cost through the passenger grant, rather than saddle the railways with historic and future debt charges. Expenditure on new routes of major electrification schemes, which are, of course, remunerative investment, will, however, continue to be treated as capital items, as will all rolling stock, stations and freight investment. Clause 2 increases the Board's borrowing powers to £600 million, extendable to £900 million by Affirmative Resolution. These figures include the capital debt to the Secretary of State remaining under Clause 1. But they do not represent the Board's total investment programme since, as I have said, much of that will in future be financed from revenue.

It is essential that the Government and Parliament should be given adequate control over, and opportunities to review, the expenditure of such large sums of money. Since 1972, the Government have been meeting British Rail's increasing losses through cash shortfall payments without specific statutory authority. The Bill replaces this open-ended drain with a considered régime of control and review. Clause 4 of the Bill requires the Railways Board to act on lines settled from time to time with the approval of the Government in formulating policies and plans for the general conduct of its business. It also strengthens the Secretary of States's powers to obtain information from the Board. Clause 3 enables the Secretary of State to determine the conditions under which the grant shall be paid. It is not the Government's intention in seeking this power to reduce the responsibilities of the Board and its managers. The Government cannot manage railway services directly, and have no intention of trying to do so. At the same time, we need a system which will enable the Government to influence the direction of railway policy, to monitor expenditure and to assess whether the community is getting value for money.

Before I turn to the other provisions of the Bill, the House may wish to know how the Government see the future of railway investment. The whole field of public expenditure is at present being reviewed and so specific figures for railways investment cannot be given at present. The Government accept in general the strategies put forward by British Railways last year, and will provide an appropriate level of investment to implement them, subject, of course, to the general economic situation. In practical terms, this means that we accept that the railway's network should be of roughly its present size and that passenger services should be improved with new rolling stock, including high-speed diesels and the advanced passenger train, modernised terminals and better interchanges. The Government attach particular importance to the improvement of commuter services. These are the trains that most of British Rail's customers use, and there is an urgent need to ease the lot of the long suffering commuter.

Freight services will also continue to be improved. One of the aims of the Government's policy is to encourage suitable freight to transfer from road to rail, and the Bill will assist railway freight in two ways. First, the new support sys-stem recognises that the bulk of the joint cost of the railway's system is attributable to passenger operations. The grant under Clause 3 will therefore be so structured that freight operations will have to bear only a relatively small, though fair, share of the joint costs of track signalling and administration. Secondly, Clause 8 provides for a new grant from Central Government, to assist the construction of private sidings, including associated depots, access roads and equipment, where this will encourage industry to send suitable traffic by rail. These grants will be paid where it be desirable from a local environmental point of view to get the traffic on to rail, but where this would not occur normally since it would require additional investment by industry.

There are limits to the extent to which freight can be transferred. The support for freight provided by the Bill should assist the Board to continue the considerable success it has already achieved in increasing its carryings of such commodities as coal, iron and steel and aggregates and transporting them efficiently, safely and economically.

The remaining important purpose of the Bill is to bring about a long-needed rationalisation of the arrangements for financing the Board's pension obligations. At present these have a serious effect on the railway's finances, because they have inherited inescapable pension obligations from the past which simply cannot be financed from current revenue. The Bill, therefore, provides in Clauses 5, 6 and 7 for these obligations to be funded over a period by the Board, with the help of grant from the Government, and also for grant for repayment of money invested in the railway's business by the pension funds. The Bill is concerned only with the arrangements for financing the Board's historic obligations in respect of pensions; it does not in any way affect the actual pensions which railwaymen receive. It will involve the Government in a commitment over the years to provide finance of over £1,000 million. Finally, Clause 9 enables salaries to be paid to the chairmen of transport consultative committees, as is already the position in other nationalised industries.

In all, the measures set out in the Bill will give British Railways support as never before. They result from a comprehensive review of the railway's business which showed that, if the country is to continue to have a railways system of any significant size, substantial Government support will be needed for the foreseeable future. It is now up to all concerned—management, workers and customers alike—to demonstrate in practical terms that they share the faith which the Government have shown in the long-term future of a national rail network by running it efficiently, making the most of the opportunities provided by higher investment to increase productivity, and by using the services the railways provide. My Lords, I beg to move.

Moved, That the Bill be now read 2a.—(Lord Garnsworthy.)

7.10 p.m.

LORD MOWBRAY AND STOURTON

My Lords, the noble Lord, Lord Garnsworthy, has put us all in his debt by the careful and painstaking way he has moved the Second Reading. In general, the Opposition welcome the Bill as necessary, although there are one or two aspects of it which still slightly worry us. The Government, like the Opposition before them, had the findings of the British Railways Board before them which they had been asked to undertake by my right honourable friend Mr. Peyton. The first point they made was that no railway network is viable, but they added: Any significant reduction in size of the present system of some 11,500 miles would actually require greater financial support. This led them to the second point that the "necessary railway" could be defined only in the context of an overall national transport policy as decided by Governments. They said that in their opinion the present size was about right.

Most noble Lords in the House to-night will probably welcome the fact that both the last and the present Government accept these premises. The Railway Board's third point sensibly was that the capacity of our under-used railway system should be exploited to the maximum. I shall return to that matter in a moment. The fourth point was that personnel on the railways are likely to decline by about 2 per cent. per year. The fifth point was that over the next nine years capital investment of some £1,787 million would be required, which is almost double the present rate of investment.

My first point is about the Board's reference to overall transport policy. As noble Lords know, had the Conservatives been returned to power, our Bill would have been accompanied by a White Paper on our overall transport strategy. This Government have already not only cut what we considered vital to the nation's economic health—that is, the 3,500 mile network of major trunk roads by the early 1980's which has been reduced to 3,100 miles—but also the standard of the roads being built has been lowered as well.

We had planned substantially higher investments in four key railway centres. We intended to achieve it by switching resources within the transport section, mainly from lesser urban roads to the railways. The Railways Board, with road, air and water transport authorities, would have all seen their place within a larger framework and therefore could have planned their long-term strategy in unison instead of having to plan as now in ignorance of the future long-term Government strategy of the overall picture.

That leads me to another point. What will be British Rail's capital investment programme now for improvements and modernisation? I know that the noble Lord, Lord Garnsworthy, said that this programme would be up to standard and so on, but I see nothing in the Bill to tell us what the Government's plans are in this respect. Yet it is on such matters as the improvement of the fast Inter-City services, with the prospect, as the noble Lord said, of high-speed diesel trains and later on advanced passenger trains, that rail popularity with the travelling public will largely depend.

The long-term investment in traffic signalling and similarly the improvement of commuter services will now, I am happy to be told by the noble Lord, be met out of revenue. 1 say I am happy because it means that they know where they are on this and that the future investment programme will be able to be met without it having to come out of capital investment monies.

To return to what is in the Bill, the figures are, 1 think we will all agree, frightening, the more so when one remembers that in the last ten years there has already been some £3,000 million of Government assistance to the railways. The £1,500 million awarded under Clause 3—I agree that this is a maximum figure—to subsidise passenger services over a period of the next five years will not, I trust, be assumed by British Rail to be a recurring exercise. I should like the noble Lord to confirm that such is not the Government's intention.

In 1972 British Rail's actual trading deficit was some £26.2 million. Last year it was £51.6 million. I would hope that with the new subsidy in five years' time they will have been able to largely stabilise this position. It is vitally important that this money should not be frittered away. There will be no one to gainsay me on that, but with the Cooper Brothers formula now scrapped I sincerely hope that the Secretary of State will use the powers in Clause 4 to make British Railways accountable to him. More Parliamentary supervision will now be necessary. It will bring us a problem: how to equate the necessary in- creased Parliamentary scrutiny against British Railways very necessary freedom of management responsibility. The trust and good will on the part of those concerned will be necessary. I was glad to hear what the noble Lord, Lord Garnsworthy, had to say about that.

Clauses 5, 6 and 7, dealing with pension funds will be unreservedly welcomed by all in the House. I also welcome Clause 8. In this House we have continually heard how your Lordships would like to see more goods taken off the road and put on rail. If rail is to double or treble its load of freight it must make its services for freight and parcels more attractive to industry. Provision of more freight facilities is essential. With the long-term opening up of the North-East of Scotland and the likelihood of the Channel Tunnel, British Rail's freight section has a chance opening up before it which never existed before. I hope sincerely that they will seize the opportunity with both hands.

I have spoken for long enough. I have indicated that, although we greet the Bill, we do so with reservations, because although it wills many means it leaves much unsaid. Nowadays, transport has to take into account not only economics but environments and sources of energy. I suggest to your Lordships that only if the Bill is quickly followed by other information, advice and action will it be as useful as is intended.

7.19 p.m.

LORD LLOYD OF KILGERRAN

My Lords, may I presume to associate myself with the noble Lord, Lord Mowbray and Stourton, in welcoming the Bill and congratulating the noble Lord the Minister upon his clear, sympathetic and statesmanlike approach to these railway matters. I was delighted to hear the noble Lord differentiating the functions of the Railways Board from that of nationalised industry, and emphasising that, unlike nationalised industries and their functioning, from the financial point of view the railways were a public corporation providing environmental and social assistance to the community. Therefore we on these Benches welcome the fact that, as the noble Lord said, the attitude of the Government towards the railways is "as never before." Therefore we would support all the measures which are introduced in the Bill.

We particularly welcome the noble Lord's assurance that he accepts and will be supporting a strategy of the Railways Board as put forward last year. In this connection may I presume to say that that will probably mean that the railway in North Wales—so many of us know about the Cambrian Railway—will continue to survive. We welcome his reference, of course, to improving the conditions of the commuter services. I should like to support what was said about Clause 8. We too would welcome Clause 8, in the hope that it can be effective in improving the freight arrangements of the railways, so inducing more freight to come on to the railways and away from the roads.

There is one matter which we on these Benches always find somewhat disconcerting, and something about which we are usually a little unhappy. We are always unhappy about the procedures which may be set up, and which indeed may exist, in order to deal with regional matters. We hope that, particularly in regard to the rural areas of Wales and Scotland, the voices from those areas will be heard and dealt with as sympathetically as the whole matter has been dealt with by the noble Lord, Lord Garnsworthy, this evening.

7.21 p.m.

LORD BERNSTEIN

My Lords, I am overwhelmed by the excitement of this debate. I was here about ten days ago when there were ten of us in the Chamber. I have not counted to-night, but we have less, I think, to-day, at 7.20. What is it about British Railways which makes everybody run away?

LORD LLOYD OF KILGERRAN

My Lords, I can count at least 15 in the House at the moment.

LORD BERNSTEIN

I am delighted, my Lords. It was 10 o'clock when I spoke on the previous occasion. I have no doubt that the noble Lord, Lord Garnsworthy, has been clear in reading out the purposes of the Bill and explaining the Bill itself; but I am very surprised that while it comes from the Department of the Environment, yet not a word is said about the environment in this particular Bill. I do not know who thinks that is important. I think it is. The noble Lord, Lord Mowbray and Stourton, on the other side of the House talked about "exploitation to the maximum." Is that what we want nowadays—exploitation to the maximum? I thought that was something that we did not want nowadays.

LORD MOWBRAY AND STOURTON

My Lords, with great respect to the noble Lord, I said exploitation of under-capacity.

LORD BERNSTEIN

My Lords, I have not really worked out the figures at all. All I know is that every successful railway organisation in Europe is nationalised. At what cost we have not been told, and I have not worked out our figures. I am not opposed to the nationalisation of British Railways: I am opposed to the people who are responsible for the running of British Railways. It is not only a question of whether a train comes in on time, but whether the people concerned are accepting to the full their responsibilities as a national organisation. I do not think they are.

In the Explanatory and Financial Memorandum they are given powers for the "general conduct of their business" subject to the approval of the Secretary of State. The Secretary of State concerned is the Secretary of State for the Environment. It also places on him and the British Railways Board a general obligation to operate the passenger system. Should there not be powers to do more than that? Should the Secretary of State not have powers to make sure that from the national point of view British Railways us their land to better advantage? Should he not be given powers to make sure that new railway lines get the same kind of attention as new motorways do? No new motorway has been built in recent years without the permission and the co-operation of the local authorities. Under this Bill and all previous Bills British Railways can do what they like irrespective of the local authorities.

I should like the noble Lord, Lord Garnsworthy, to tell us a few things. Will he give us a promise that no money will be spent on the Channel Tunnel railway development until the Board has received approval, publicly, from the other place? British Railways have poisoned the centres of many of the cities in this country, as I pointed out on the previous occasion, when we had a maximum audience of ten. You have only to see the railway lines and the arches on the Southern side of the Thames to realise that: There are nine railway arches crossing roads in Manchester City which have had no trains over them since 1960—14 years ago. Are we going to allow these British Railways people to go on doing what they have done in the past?

In Clause 4, subsection (3), it says: The Railways Board shall furnish the Secretary of State with such information as he may specify in writing …". I want him to specify in writing what they are going to do when they develop the railway system, and its relationship to the local authorities through whose areas the lines are to be built. Then, in subsection(4) it says: …the Railways Board shall, as soon as possible after the end of each accounting year of the Board and in accordance with subsection (5) below, make to the Secretary of State a report on the exercise and performance by them of their functions during that year and on their policy and programme and the Secretary of State shall lay a copy of every such report before each House of Parliament". I suggest they should also list the land which has been sold, the price of the land and to whom it has been sold. They should also say whether the local authorities had wished to buy such land. Will the noble Lord, Lord Garnsworthy, give those undertakings—

LORD TAYLOR OF GRYFE

My Lords, if I may interrupt on a matter of fact in relation to the disposal of land belonging to nationalised industries, I understand that it is the practice that local authorities and Government Departments are advised of the availability of such land before it is offered on the open market.

LORD BERNSTEIN

I hope the noble Lord is right, but I can tell the noble Lord of an incident where it was not so. The Manchester City Corporation walked to the offices of the British Railways Board with a cheque made out for £2,500,000 to buy the Central Station, and they refused it. A few weeks later it was sold to a private organisation, who in turn sold it again. The full story is available in the Sunday Times.

LORD TAYLOR OF GRYFE

My Lords, I am sorry to interrupt again. I do not want to pursue it, but the fact I wanted to establish was a general fact affecting all nationalised industries. I am sorry to interrupt the noble Lord.

LORD GARNSWORTHY

My Lords, I think my noble friend Lord Taylor of Gryfe ought to be a little careful because of his position.

LORD TAYLOR OF GRYFE

I am sorry, my Lords, if I have offended against the practices of the House. I am a member of the British Railways Board, and I was not answering a question in relation to British Railways; I was con-finning a general principle on land belonging to nationalised industries. But I take the point of the noble Lord, Lord Garnsworthy, and thank him for it.

LORD BERNSTEIN

My Lords, is the noble Lord, Lord Taylor, saying that the British Railways Board did not comply with general principles in this matter? May I continue. I should like to have that undertaking; and I should like to make one further point in connection with the Channel Tunnel. The Secretary of State, Anthony Crosland, said in the other place: The object of proceeding with phase two of the Channel Tunnel is to keep our options open. It does not prejudge any decision on the project beyond the present phase. Will this Bill in any way allow the British Railways Board to continue with their ideas of a Channel Tunnel railway line without their having to go back to the other place?

7.28 p.m.

VISCOUNT DE L'ISLE

My Lords, I do not want to keep your Lordships from the main subject of discussion in this House to-day, but I think all your Lordships should realise—I am sure we all do—that in bringing the Bill before Parliament the Government and British Rail are asking us to agree to an enormous burden on our total economy. The problem of transportation is always a difficult and complex one. Perhaps in some ways we in our generation, thanks to all, may have gone too fast. We have had difficulty with airlines; we have had difficulty with the railways; we never have enough money for our roads. If British Rail is to receive this enormous subvention, mainly for passenger traffic, it will necessarily be a drain on all the other resources in this country.

Since the making of a profit year by year, which used to be the guiding principle, no longer subsists, what are the guidelines? It is very difficult to say, but the Bill takes rather an obvious course. It says that it shall be subject to the Minister, the Secretary of State or whoever is the Minister of the day, who has charge of the British Rail system. The powers of any Minister or his advisers are limited in technical matters and this places an enormous responsibility on the British Railway Board. They are not accountable for pofit. They are accountable in detail and for policy; but they are accountable to a Minister who, in the nature of things, being busy with other enormous Departments, finds it difficult to fulfil adequately. I think that we in Parliament should take a continuing interest in all Departments of State which are large spenders of public money. The kind of anomaly which occurs to me—and I am not a learned economist but I am in business—is that we subsidise the fares of season ticket holders into the City of London because the cost of the fares is not covered by the payment from the passengers, ex hypothesi what the noble Lord told me. At the same time, we limit the building of office space in the City because we do not want to overburden it. In fact we are subsidising the rent of City properties by this process. This is the difficulty which all institutions and Governments and organisations get into when the price system does not work. I am not going on to speak of the great problem which no Government in any country have solved; but we lose the guidelines.

The British Railways Board are sitting in a seat of great power. They have received their subsidy; and when the information is available, and it is generally later than sooner, they report to a Minister who lays a report before Parliament and he is also susceptible of detailed questions. I am not going to revert to the Question I asked in the House the other day but, like the noble Lord, Lord Bernstein, I have great doubts about the confidence of a board like that of British Rail to deal with all the social and environmental aspects of the problem. Since Parliament is over-burdened and local authorities to a large extent are ruled out; since it appears that such forms of inquiry as planning permission inquiries are no longer applicable to statutory bodies; and since environment is not people but perhaps certain stretches of the countryside, we must watch that British Rail (in their wisdom, as may be, but with their eagerness to compete with Japan and France in higher and higher speeds) do not intrude more and more on our environment by louder and louder and faster and faster trains. We must watch that by allowing British Rail to get power through Parliamentary procedures and hybrid Bills and so on which are not a popular form we are not really subsidising the destruction of our own environment.

7.35 p.m.

LORD HAWKE

My Lords, I shall be brief. I agree that amputation is no solution to railways; you must either subsidise or shut down; and I think that shutting down is completely impracticable. For years I have heard successive Governments talking about a co-ordinated transport policy but not one has ever emerged, and I do not think one can emerge because it is too complicated a business for the human mind to manage. I think there are one or two instances of wasteful competition. One of them is short-distance air travel against the Inter-City liner. London to Scotland is a practicable air travel proposition; but when businessmen hop on to planes to Manchester and Leeds and so on, when one knows well that they can go just as quickly by train, I do not think that they are using our best facilities. Half of them go only because it is a matter of prestige and the thing to do. Our new trains are wonderful and we must be grateful to the designers in the Southern Region for having produced at last commuter trains which are extremely comfortable and extremely good. One must beware of railway enthusiasts. I have known at least two general managers of railways who in their spare time played trains in their own house. It is the besetting vice of railway men that they get too enthusiastic. I am dubious about the tremendously high-speed trains as to whether the enormous expense can be justified. I still cannot see how they can spare the track for 120 to 130 miles an hour trains.

My Lords, the last time I spoke on this subject I spoke about land. That was on a Bill where we wrote off £400 million of the railways' debt. I said that in return for this £400 million we should make the railways hand over to the Government their surplus land of which they then had an immense quantity. I do not know that progress has been made in disposing of it privately but they, like every landowner, think that everybody has a divine right to put office blocks on every bit of land that they own. They will sit on it until the last minute in the hope that they will be able to do so; whereas the land only too often is in the most strategic places for urban housing. One of the greatest needs of this country is more urban houses for London service personnel including their own railway-men. I repeat my plea that in return for another large write-off we, as taxpayers and general citizens, should demand the handing over of railway surplus land to be used for housing.

7.39 p.m.

LORD GARNSWORTHY

My Lords, we have had an interesting and wide-ranging debate even if the Chamber has not been over full. My noble friend Lord Bernstein made reference to attendance at the last debate on the railways and to attendance this evening. I think it is generally appreciated that the Members of this House have been here in unusual numbers this afternoon and have been working very hard. In fact, they have gone to get the sustenance which those who have been responsible for the measures they have been considering greatly need. Speaking as one who is often in his seat at debates in the House between seven and eight at night, I may say that the attendance at this debate is higher than normal. Those who normally sit in as I do will appreciate the accuracy of what I am saying.

My Lords, the noble Lord, Lord Mowbray and Stourton, put one or two questions to me. First, he asked why there was no Transport White Paper. Does it need repeating again and again that this Government have not been in Office very long? I think that in the five months we have been in office we have not done too badly. We have made a statement on the roads programme—and we are not the architects of the economic situation which determined our approach to these matters—and we have introduced this Railway Bill. I do not think this is a bad record. We want to see this Bill enacted as soon as possible so that the present ad hoc system of deficit financing can be replaced by a proper system of suport and control and we want to see that system operating from January 1 next year. To have waited for the issuing of a White Paper would not have been a good thing. It would merely have delayed this essential measure.

I am not too sure that the House was aware that a White Paper would have been issued had the previous Administration introduced a Bill. I have made some research and I must say that I can find nothing positive, but the one point I am very certain about is this: if we are to have sensible consideration of an overall transport policy, we must be very careful not to rush at it and make decisions on the basis of inadequate information. There are a number of issues which need to be settled before any Government can face up to the consideration in depth required to produce a viable overall transport policy.

My Lords, on the question of investment income, I think that, at this stage, perhaps I had better limit myself to saying that what we hope to see here is concentration on bulk night traffic and trunk haul parcels—a point which the noble Lord himself was making. We hope to see concentration on the need urgently to improve commuter services, development of inter-city passenger services of which the noble Lord, Lord Hawke, has spoken so ably, and concentration on the need to maintain and improve track and signalling to increase efficiency and safety and reduce operating costs. However, I have to say that actual investment levels have to be considered as part of the general review of current expenditure programmes, and that is bound to take some time. If it is possible as the Bill proceeds to give more information, I will do my best to do so, but I can say this: so far as inter-city passenger services are concerned, at the moment, as the noble Lord indicated, I think that this growth is welcome to the Board—and it is indeed a major growth area—and we are hoping that the services will be improved in quality and speed. We hope that highspeed trains will be introduced on The London-Bristol-South Wales line in 1976, and the Government are at present considering the Board's proposal to introduce them on the East coast main line. Proposals to construct four advanced passenger train prototypes are also being considered. There is a continuous programme of rolling stock and terminal modernisation. If I can be of further assistance as the Bill goes through, I will be; or, alternatively, I shall be very happy to pass on to the noble Lord such information as I can.

My Lords, my noble friend Lord Bernstein asked questions about the Channel Tunnel and I have to say, and indeed it was said in the debate in this House the other evening, that no decision has been taken about the Tunnel or the rail link to it. The two issues will have to be considered together. There is no question of the link being subsidised. If it comes, it will have to pay its way, and the link will be subject to a Private Bill and to planning procedures. In regard to the environment, I do not want to suggest that I did deal at any length with environmental questions, but I think that my noble friend suggested that I did not even use the word "environment". I think that I am correct in saying that I did make reference to the environment.

LORD BERNSTEIN

My Lords, I apologise for interrupting. My noble friend certainly did, but it is not in the Bill and we are considering the Bill.

LORD GARNSWORTHY

My Lords. I appreciate what my noble friend says about what I said and what I read and what is in the Bill, but I am making the point that I did use the word "environment", whereas I think—and I think anybody listening would have felt—that the noble Lord was implying that I had shown no regard for the environment. Let me say that I did not feel it right that I should cover ground that we covered the other evening in the debate on the Unstarred Question. I would remind the House that I then said that we should have consultations with the planning authorities, and I think that we have shown considerable regard to what the planning authorities will have to say about a possible route for a link to the Channel Tunnel.

I am sorry that my noble friend speaks as he does about mistrust of the Railways Board, because I think it will tend to create a difficult situation in that the Board will feel that there is soms prejudice there. But I do say to my noble friend that I will see to it that my right honourable friend's attention is drawn to what he has had to say, and I am sure that he will have some regard to my noble friend's words.

My Lords, I listened with interest as I am sure did the whole House, to what the noble Viscount, Lord De L'Isle, had to say. I think he will not want me to cover a great deal of ground much of which—and indeed more—was covered in our debate the other evening. I thank the noble Lord, Lord Mowbray and Stourton, for the limited welcome he gave to the Bill and the noble Lord, Lord Hawke, for what he had to say, and I am very glad of the welcome which he gave to the Bill. I also greatly appreciated the comments of the noble Lord, Lord Lloyd of Kilgerran.

My Lords, this country cannot afford to lose its railways. I do not think that anyone would deny that. But it is not until a railway track is torn up that people really appreciate the social or the environmental consequences. There has been a very great deal of environmental damage following destruction of railway services in parts of the land. As the Bill proceeds through Committee, I hope that we shall give it the speedy passage which I believe it deserves, for the railways need to know where they are; and so far as the railway pensioners are concerned, what is proposed in the Bill is nothing other than justice.

LORD MOWBRAY AND STOURTON

My Lords, before the noble Lord sits down, may I ask him whether he is aware that on November 28 last year, in another place, my right honourable friend Mr. Peyton said: The necessary powers to provide appropriate financial support will be taken in a Bill to be presented to Parliament shortly. This will be supported by a transport White Paper, which will underline the greater emphasis the Government are giving to railways and other forms of public transporc."—[OFFICIAL REPORT (Commons), 28.11.73; c. 399.]

LORD GARNSWORTHY

My Lords, I am grateful. I would say that I have also been reading what the noble Lord's right honourable friend said in the other place on January 16, 1974, and I could not see that he was being as specific in January as on the earlier occasion. I quote one sentence: I prefer to wait until there has been clarification of the energy problem."—[OFFICIAL REPORT (Commons), 16.1.74; c.519.] My Lords, I do not think that anybody will say that that problem has been cleared up entirely.

On Question, Bill read 2a, and committed to a Committee of the Whole House.