§ Following is the statement referred to by the Lord Lucas of Chilworth last Monday; col. 46:
§ DEPARTMENTOFTRANSPORT 2 MARSHAM STREET LONDON SW1P 3EB 01–212 3434
§ R. B. Reid, Esq., CBE,
§ The Chairman,
§ British Railways Board,
§ Rail House,
§ Euston Square,
§ LONDON, NW1.
§ "Dear Chairman, 24th October 1983
§ "This letter sets out the objectives the Government wishes you to pursue. It supplements the statutory and financial duties of the Board.
358§ "Your guiding objective should be to run an efficient railway, providing good value for money. Services to your customers should be reliable, attractive and punctual, at acceptable fares and charges; and the cost to the taxpayer should be reduced. That is the way to achieve a secure future for the railway, enable worthwhile investment to go ahead and give your employees satisfaction and pride in their work.
§ "The Board's current Plan shows the requirement for PSO grant from central government falling to about £700m (in 1983 prices) in 1986 and to about £635m in 1988. The Government wants you to go faster than this so as to reduce the requirement for central government grant to £635m (in 1983 prices) in 1986. Your 1984 Plan should show the profile of expenditure and the measures required to achieve this.
§ "It is not our intention that you should embark on a programme of major route closures. At the same time I should welcome your early views, following the endorsement of the case by the Select Committee on Transport, on the practicability of introducing some guaranteed and subsidised substitute bus services, where they would be appropriate on local transport and value for money grounds.
§ "I shall want you to work closely with London Regional Transport, when it is set up, and with other public transport operators, to provide a better deal for travellers in and around London and to avoid wasteful duplication.
§ "It is the Board's responsibility to determine fares. But improved efficiency must make a full contribution to keeping down fares. The railway must not use its market position to raise fares unreasonably.
§ "The Board's 1983 Corporate Plan shows the Freight Business coming into profit by 1986. You should take the necessary action to ensure that it achieves a current cost operating profit of 5 per cent. in 1988. Within the financial targets set out above, I want you to win as much freight business from road as possible. The objective for the Parcels business should be to continue to earn a proper commercial return. I look forward to receiving the Board's review of the Inter-City business against its commercial target.
§ "The Government wants you to secure improvements to the railways' present industrial relations machinery, which has hampered good communications and slowed down the necessary pace of change.
§ "Sealink must be made ready for privatisation as soon as possible. The Government looks to you to obtain from the private sector more supply and support services, including rail and station catering. I shall welcome proposals from you for more private sector finance and participation in the development of stations and railway services. The Board should continue to pursue a vigorous policy of property development and disposal.
§ "Rationalisation of British Rail Engineering Limited's excess capacity should be completed as soon as possible. You should complete your review by the middle of next year of the options for the future of BREL, including the options for privatisation. Railway rolling stock should be procured wherever possible by competitive tendering; and the railway equipment industry should continue to be allowed the opportunity to offer design solutions to meet BR's requirements.
§ "Your investment programmes should relate directly to the financial and business objectives set out above. You will clearly wish to give proper priority to cost saving investment which gives an early return; and to carrying forward the improvements which the Board has introduced in management accounting and control.
§ "I look forward to working with you and your Board to achieve the good quality, efficient railway services which are our common goal and to seeing these objectives reflected in your 1984 Plan.
§ "Yours sincerely,
§ (signed) "Nicholas Ridley".