Rail Franchising Director: Resignation (Hansard, 18 April 1996)

§ The Parliamentary Under-Secretary of State, Department of Transport (Viscount Goschen)
My Lords, in his statement, Mr. Roger Salmon said that when he first took up the job of franchising director he set himself a number of objectives, including the creation of an effective franchising organisation, paving the way for capital investment in infrastructure and rolling stock. Once those objectives had been achieved, he would hand over to someone else. Mr. Salmon has now achieved the objectives and has therefore decided to stand down in October.

§ Lord Berkeley
My Lords, I thank the Minister for that Answer. However, it was my understanding that when Mr. Salmon was first appointed in April 1994 he was set the target of having 51 per cent. by value of the passenger franchises let within two years. He achieved 17 per cent., which is exactly one-third. Mr. Watts, the Minister for Railways and Roads, said on Mr. Salmon's leaving: Mr. Salmon is leaving on the crest of a wave, having met all his targets". 791 Is that the wrong kind of wave, or something, when he only achieved one-third of the target? Can the Minister say whether it is more likely that Mr. Salmon became thoroughly fed up with continuing government interference, the changes and the hassle that have taken place in what many of us believe was an impossible job in any event? Indeed, is it possible that he has decided to spend more time with his merchant bank?

§ Viscount Goschen
My Lords, the noble Lord should look at what has actually been achieved. There is absolutely no point in setting a target if it is an easy one. Indeed, one has to have a tough target. It might well be the view of the Opposition to set very easy targets, but we believe that if you have a tough target you will then reach it. I should point out that 60 per cent. of the passenger railway is either for sale or has been sold. Seventeen per cent. of the railway is already running; a further three franchises at 18 per cent. have been awarded and will begin running in the private sector in the near future; and a further eight franchises—25 per cent. of the passenger railway revenue—are already on the market. I believe that that is a significant achievement. We are talking about a major change to the way that we run our railways. There are major benefits for the customer and for the taxpayer. I know that today it has been reinforced that the party opposite does not care.

§ Lord Peyton of Yeovil
My Lords, does my noble friend the Minister agree that regret at the departure of the franchising director is considerably tempered by his persistent refusal to take the slightest notice of the amendment passed in this House? I wonder whether my noble friend can shed any light on the question of whether the franchising director was exercising his own discretion or whether he was responding to a powerful nudge from elsewhere.

§ Viscount Goschen
He was using his own discretion, my Lords, as set out in the Act.

§ Lord Carmichael of Kelvingrove
My Lords, can the Minister confirm that when the Government decided to accelerate the process of privatisation from four to two years it meant that the funds which had originally been planned on a four-year basis in the short and medium term became inadequate to do the job properly? Can the Minister confirm that one of the reasons why Mr. Salmon resigned was that he could not complete the task that he had originally set for himself? If the Government find a new franchising director he would, of course, be on a short-term contract. Can the Minister say whether more money would be available to enable him to carry out the job that Mr. Salmon thought he would be able to do?

§ Viscount Goschen
My Lords, the funds available are perfectly adequate. Indeed, I would say that the franchising director has done a very good job. He has not been given any directions by Ministers to accelerate the franchising programme, as the noble Lord said. On the one hand, the noble Lord said that we are behind; on the other, he said that we are speeding up the process. He cannot have it both ways.
792 The party opposite said that rail franchising would cost more. That is not true. Indeed, we are now seeing much lower levels of subsidy being awarded. The party opposite said that fares would rise; no, they are being capped. The party opposite said that services would be worse; they are better. The party opposite also said that investment would be lower; in fact, it is higher. It is true to say that the programme is now going forward most satisfactorily.

§ Lord Gisborough
My Lords, does my noble friend the Minister agree that people travelling up from the south will be very glad to hear of the abolition of the slam-door trains and the planned modernisation? That will make a huge difference.

§ Viscount Goschen
My Lords, I imagine that passengers on those lines will be absolutely delighted at the news.

§ Baroness Thomas of Walliswood
My Lords, I recognise that it is an extremely beneficial change to have a longer franchise. However, is the Minister aware of the very deep level of cynicism on the part of rail users—and, in particular, of rail-user groups—concerning the likely effect of franchising in terms of the quality of service, and especially the level of investment? Is the Minister further aware that some franchise holders also have difficulty understanding how they will be able to produce the right level of investment on a seven-year franchise to substantially increase the attractiveness of rail travel to the user?

§ Viscount Goschen
My Lords, I do not recognise cynicism among rail users although I recognise it among certain groups and the parties opposite who are trying to oppose the programme. We believe that those who are actually travelling on the lines that have been franchised are seeing the benefits of better service. They have heard the promises of further investment by the new franchisees. They know about Network South Central, the most recent franchise, and a further £10 million investment promised in refurbishing trains, rolling stock and stations. Those are the things that matter to the people who travel on the railway and, indeed, to the taxpayer who will now pay substantially less by way of grant or subsidy to the railway than he did before. With the Network South Central franchise, for example, the average subsidy will be less than half it was under BR.

§ Baroness Hamwee
My Lords, if the Minister does not recognise cynicism among rail users, has he read Christian Wolmer's column in the Independent on Sunday about mad events on the railways since the institution of the current arrangements?

§ Viscount Goschen
My Lords, there is an old saw that you should not believe everything you read in the newspapers.

§ Lord Harding of Petherton
My Lords, I do not know whether the noble Baroness is a rail user. As a rail user on both of the privatised lines to the south west from Taunton to Paddington and from Sherborne to 793 Waterloo, I find that the service has improved immeasurably in the run-up to privatisation. Indeed, the punctuality has improved—

§ Lord Avebury
Question!

§ Lord Harding of Petherton
My Lords, do I have the right to finish?

§ Viscount Goschen
My Lords, my noble friend has made some powerful points.

Noble Lords
Oh!

§ Viscount Goschen
Well, my Lords; those in the party opposite obviously do not care one jot what the travelling public actually think about the railways. They much prefer to rely on party dogma whereas we believe that we must look at the benefits to passengers. My noble friend is a passenger on one of the newly-privatised lines. He has seen the benefits. I travel on that line. I have also seen the benefits.