Rail Privatisation: Timetable (Hansard, 27 June 1995)

§ The Parliamentary Under-Secretary of State, Department of Transport (Viscount Goschen)
My Lords, the Government remain committed to the target of franchising 51 per cent. of passenger services by April 1996 that was set for the franchising director in the objectives, instructions and guidance issued to him on 22nd March 1994.

§ Lord Clinton-Davis
My Lords, is the Minister aware that British Rail managers have indicated that that is an impossible timetable to undertake and have expressed grave concern about it? Is he further aware that the whole procedure is so hideously complex that the Office of Passenger Franchising, with some 70 staff, is finding it extremely difficult, I understand, to cope with the volume of paperwork? Is not the requirement for indicative bids before proceeding to ask for a full bid a concession on the part of the Government who have no idea of the amount that the private sector is expected to bid for the franchises?

§ Viscount Goschen
My Lords, the process is necessarily complex. However, we have made good progress and remain committed to the target. It is a challenging target, but there is absolutely no point in having a target unless it is challenging. Prequalification documents for the first eight franchises were issued in January. Invitations to tender for the first three franchises were issued in May. At the same time, draft passenger service requirements for four more franchises were issued for consultation. That illustrates that we have made considerable progress towards the challenging target of franchising 51 per cent.

§ Lord Clinton-Davis
My Lords, why do the Government insist on indicative bids? After all, when the owner of a house wants to sell it he does not ask for an indicative bid before the full bid is forthcoming. What is the rationale behind that?

§ Viscount Goschen
My Lords, we have set up a very full procedure to make sure that the bidding process goes the right way. We need to make sure that value for money is secured and that the best services are provided. We believe that the very full procedure that we have set out is the best way to go about it.

§ Lord Harris of Greenwich
My Lords, will the Minister tell us what is the basis for the Government continuing with this policy, given the fact that they are tearing themselves apart day by day on the question of leadership? What conceivable mandate do they have for privatising British Rail?

§ Viscount Goschen
My Lords, I should have thought that the production of better services for passengers, an increased level of service, and achieving better value for the taxpayer were all worthy objectives of a Conservative Government.

§ Lord Marsh
My Lords, will the Minister accept that many of us feel that the concept of indicative bids is not only sensible but absolutely crucial since it enables the Government to have in advance some idea of exactly how much money they will have to pay the bidders to take this off their hands?

§ Viscount Goschen
My Lords, I was about to say that I was grateful to the noble Lord. As he points out, there is clear value in the bidding process we have set out. It is the best way of handling what is a highly complex procedure.

§ Lord Ezra
My Lords, even if the Government's programme is achieved, will there not be a hiatus in the provision of the essential investment required to make the railway system successful?

§ Viscount Goschen
No, my Lords, quite the opposite. Our approach will produce the new avenues of investment that the railways have lacked. Access to new and innovative types of investment, coupled with innovative management, will, I am sure, produce better services for the passenger.

§ Lord Gisborough
My Lords, will my noble friend agree that every single one of the privatisations was bitterly opposed by the other side and every single one has been extremely successful?

§ Viscount Goschen
My Lords, it could not be put better than that. I agree totally with my noble friend, and the look of anguish on the Benches opposite reflects that truth.

§ Baroness Farrington of Ribbleton
My Lords, will the Minister give the House an assurance that in the process of franchising—if they are in a position to carry it out—the Government will ensure that services under the franchising arrangements will connect? Can he assure us that the current nonsense whereby, owing to the beginning of the break-up of services, it is 608 impossible to get connecting regional and InterCity trains from one part of the country to another will end? Will he also confirm that InterCity trains are being delayed when entering stations because of the break-up of services? I understand that they have to pay for the use of local platforms and therefore have to wait until an InterCity platform is available.

§ Viscount Goschen
My Lords, making services connect with each other is clearly in the interests of those who will run the franchises. Nothing illustrates that better than the debate that went on about through-ticketing. It is clearly in the interest of those who will bid for franchises and consequently operate them to make sure that their services connect in the best way with other services.

§ Lord Peyton of Yeovil
My Lords, while no one would challenge my noble friend's suggestion that this is a necessarily complicated process, can he tell us anything about the attitudes of the franchising director'? Is he being a little more reasonable and flexible so far as bids from British Rail are concerned?

§ Viscount Goschen
My Lords, I know that my noble friend has tabled a Question on this specific subject. We shall go into that matter in very full detail. Essentially, whether BR can bid for the franchises is a decision for the franchising director himself.