Greater London Authority Bill

HL Deb 01 July 1999 vol 603 cc454-574

4.55 p.m.

The Parliamentary Under-Secretary of State, Department of the Environment, Transport and the Regions (Lord Whitty)

My Lords, I beg to move that the House do now again resolve itself into Committee on this Bill.

Moved, That the House do now again resolve itself into Committee.—(Lord Whitty.)

On Question, Motion agreed to.

House in Committee accordingly.

[The DEPUTY CHAIRMAN OF COMMITTEES (Lord Murton of Lindisfarne) in the Chair.]

Clause 133 [Transport for London]:

Lord Swinfen moved Amendment No. 250: Page 72, line 4, at end insert— ("() Transport for London shall secure the provision of transport services that enable disabled people to have access to the same level of services as all passengers.")

The noble Lord said: In moving Amendment No. 250 I should like to speak also to Amendment No. 287 in the name of my noble friend Lady Gardner of Parkes. The purpose of this amendment is to ensure that Transport for London secures the provision of special transportation services, such as Taxicard and Dial-a-Ride in order not to discriminate against older and disabled people who cannot use regular buses. The Committee will be aware that all buses in London will be physically accessible by 2017, but there will still be an enormous need for other types of transport provision for those who cannot use mainstream buses. I am advised that there are between 250,000 and 500,000 disabled and older Londoners who cannot use regular public transport, even when it is made physically accessible.

Under the Disability Discrimination Act, Transport for London will be obliged to ensure that all its buses are accessible, but it says nothing about provision for those who cannot use physically accessible buses. These Londoners need special transport provision such as Taxicard and Dial-a-Ride which now provide in the region of 1.5 million trips a year. These are not provided as a duty and are partly funded by voluntary contributions from the London boroughs. I am aware that the noble Baroness, Lady Darcy de Knayth, who has recently tried out the Taxicard service, may have something to say about this.

If special transport services are not continued and developed, thousands of older and disabled Londoners will be left marooned in their homes. It will also mean that members of their families will have to take extra time off work to look after them, to do their shopping and to run any necessary errands, which is not to the economic advantage of the country. The amendment is also designed to ensure the continuation and development of these special transport schemes. We should place a duty on Transport for London and make provision for it. If the Government are committed, as they have said it is, to ending social exclusion and integrating all older and disabled people, will they also give a commitment to the continuation and expansion of these vital transport schemes?

I realise that there may be a drafting error in this amendment. As drafted, it may mean that the Underground services have to be accessible to everyone, even people in wheelchairs. That, of course, is impractical and is not the intention of the amendment.

With regard to my noble friend's Amendment No. 287, to which I have put my name and which I strongly support, the noble Baroness will speak on it, but it is designed to reintroduce original Clause 169 of the Bill, which was removed in the other place. It will allow the Secretary of State to make regulations ensuring the provision of door-to-door transport for disabled people. I beg to move.

5 p.m.

Baroness Gardner of Parkes

I rise to support Amendment No. 250 and to speak to Amendment No. 287, which is in my name. My noble friend Lord Swinfen has covered most of the important points. I have put down Amendment No. 287 because it does not insist on any particular scheme. The wording of Amendment No. 287 is: may by regulations make provision for and in connection with the provision of transport facilities and services provided for the purpose of meeting the needs of disabled persons resident in Greater London". That is not prescriptive in terms of how he must do it or whether he must do it. However, at least it places a responsibility upon the Secretary of State to ensure that disabled people in London are carefully considered and catered for in all forms of transport need.

My noble friend Lord Swinfen has mentioned the Taxicard scheme. I believe that it is an extremely valuable scheme. It works very well in central London. The reason for that is that central London boroughs have quite a high parking revenue and they are allowed to apply that to the Taxicard scheme. It is a greater problem in other boroughs. In fact, five boroughs have either greatly reduced the budget for it or reduced the number of journeys that people can take, which has more or less the same effect. No doubt those boroughs have found that their budgetary pressure has demanded that. If it became a part of the Transport for London issue, I am not sure where the money would come from to introduce throughout the whole of London a scheme as good as that in the boroughs in which it is working very well at present. However, one must accept the principle that it is desirable to see a gradual expansion of this scheme throughout London. Above all, we do not want to see an erosion of the present scheme, which has served so many people so well.

My noble friend mentioned that perhaps there may be a danger of implicating the Tube system. I took up this issue. It transpired that one of the real problems is that you cannot necessarily replace an escalator with a lift. An escalator can go down sideways underground and is not owned by the London Transport Authority, whereas a lift has to go down vertically and, for that reason, cannot necessarily be used.

I have for many years campaigned for a case of wheel accessible transport in London, not just for wheelchair users but also for travellers carrying heavy shopping and accompanying small children. For example, if the escalators at Heathrow are out of order, there is no way in which travellers can gain access to the Underground, which I believe is quite appalling. I asked the people at Heathrow, "What happens if you are disabled and you cannot walk down this escalator?" The reply was, "I suppose someone would have to carry you down. There is no other way". On the other hand, the access in the newer terminals, where they have been able to incorporate walking areas for passengers, is so much better. The disabled, of course, are greatly disadvantaged by a lack of access to the Underground. I believe that the Underground answer is a long way off. The bus answer may come much sooner. The taxi answer covers a different need; that is, the need of those who cannot manage on either the Tube or the bus.

I shall refer later to the issue of concessionary fares. I mention it in passing. Many people who are not yet disabled, but who have incipient disability, benefit greatly from the fact that they can use the buses and the Tube. Keeping those people mobile is really a very important way of dealing with their conditions and ensuring that much can be done for them.

With regard to the amendment put forward by the noble Lord, Lord Swinfen, and perhaps the other one too, I believe that there is a need to define "disabled persons". This is referred to in another part of the Bill. I know that it includes people with mental disabilities, a point on which tie noble Lord, Lord Rix, has spoken. It refers to "disabled persons". I believe that it would be more helpful if it said "as defined in the Disability Discrimination Act". I find it extraordinary that at the time when we brought in the Disability Discrimination Act, we removed the term "registered disabled", which was very clearly identifiable for people. However, we apparently decided at that time that this term should no longer be used. I believe that it is important to identify in any clause of the Bill exactly who we wish to identify, so that there can be no confusion about that.

I will not continue for much longer. This is an issue in which many people are interested. I hope that the Minister will take our worries very seriously and look again at these amendments.

Lord Berkeley

Both the noble Lord, Lord Swinfen, and the noble Baroness, Lady Gardner of Parkes, have mentioned the question of access to the London Underground for disabled persons. I am sure that the noble Baroness will agree that all new construction to the London Underground, such as the Jubilee Line and the Heathrow Express, is designed with disabled access in mind, with lifts as well as escalators. The problem is that if one gets on the Jubilee Line at one end, one cannot get off anywhere else.

Having said that, I do not believe that the problem centres around new construction, but rather converting the existing lines, which does not involve only escalators. When you get to the bottom of an escalator at many stations, you have to walk up or down a flight of steps. I do not believe that it is feasible, at a reasonable price, to convert every one of those stations to provide full disabled access. Therefore, some reasonable compromise has to be made to recognise that matter.

Baroness Gardner of Parkes

I intervene to say that I introduced the Jubilee Line Bill in this House. It was a very important part of that Bill, and the changeover to Waterloo Station, that lifts were installed. I completely appreciate the point. In relation to the very remote future, it should certainly be incorporated in any new station design.

Lord Renton

In moving the amendment, my noble friend Lord Swinfen expressed a doubt about the drafting of it. I am sure that that can very easily be put right. I would prefer to have this matter dealt with in the way that the noble Baroness has mentioned; namely, as part of Clause 133 of the Bill, Chapter II, which is headed, Transport for London. I believe that it would be better inserted there, creating an obligation, than in the position suggested by Amendment No. 287, which would bring it within Chapter X, dealing with transport concessions. Here we are dealing not merely with transport concessions. We are dealing with an obligation to provide transport. I suggest that it should have some prominence and come at that earlier stage of the Bill.

So much for the drafting of the amendment. Amendment No. 287 provides a good way of dealing with it. Though I always have doubts about giving power to make regulations, I believe that in this case it might be better to give that power rather than to attempt to set out all the detail in the Bill. Some provision along the lines of Amendment No. 287 but inserted after Clause 133 might be the best way to deal with the matter. However, that is for the Government to consider and decide.

As regards the merit of the amendment, we have to do something. I referred recently to GLAD as the Greater London Association for the Disabled. That body has done a great deal. However, I must confess that I was not quite up-to-date. It is now called Greater London Action on Disability. That good work must be carried on. The Dial-a-Ride scheme was introduced as a result of its efforts.

We have to bear in mind that many of the disabled people to whom my noble friend Lord Swinfen referred—there are roughly a quarter of a million—live in their own homes, including, alas, tower blocks. Others live in nursing homes, old people's homes and various charitable institutions. Some of those places can provide some transport. But it is where the individual is at risk that something needs to be done. I hope that the Government will look sympathetically at both amendments. Both have great merit. Something must be done.

Baroness Darcy de Knayth

I support most warmly the two amendments and pay tribute to the work of GLAD. The noble Lord, Lord Renton, referred to it. Perhaps I should declare that I am a patron of GLAD.

I have added my name to both amendments because I believe that it is important to write into the Bill a duty for TfL to make provision for those who cannot make use of regular public transport even when it is physically accessible to them because they need door-to-door transport. The noble Lord, Lord Swinfen, signalled that I would mention this issue. Owing to a combination of circumstances, for the past two days I have had to travel by accessible taxi from Maidenhead to London and, I hope, back again. The seamless journey has worked wonderfully. I do not think that I would be here if I had had to get in and out of a taxi, a train and another taxi, owing to sheer exhaustion and the time taken. The seamless journey assists those who cannot make use of public transport.

The noble Lord, Lord Swinfen, referred to Taxicard. I stress that I do not live in London. I should not be eligible for the Taxicard scheme—in case any noble Lord is having a fit because of my travelling from Maidenhead and returning there.

I support Amendment No. 287 which reintroduces a clause removed in another place allowing the Secretary of State to make regulations ensuring provision of door-to-door transport for disabled people. We have heard from the noble Baroness, Lady Gardner, that in some boroughs the system works brilliantly. However, it is patchy at present. There has been a recent decline in finance in some boroughs. It is desperately important to ensure that that does not happen. I think that Taxicard should be transferred to TfL as soon as possible. Until the journeys currently made possibly by Taxicard are part of an integrated London public transport strategy, the provision will continue to be uneven. Users in different boroughs will receive varying levels of provision. The funding and future of Taxicard services will be at risk and further Taxicard services will be lost. We must not let that happen. The single management and funding regime would provide a focus and platform for the development of the integrated transport service. I hope therefore that we shall hear an encouraging reply from the Minister on both amendments.

5.15 p.m.

Baroness Thomas of Walliswood

I have added my name to Amendment No. 250. I support the ideas underlying both amendments. I wish to give emphasis to the points raised by the noble Baroness, Lady Darcy de Knayth, about the seamless journey and the need to provide a Taxicard service across the whole of London and not just in some boroughs.

Lord Archer of Weston-Super-Mare

I support both amendments. I urge the Minister to consider in particular Taxicard which has 45,000 members. In Greenwich the service has stopped completely; in Lewisham, Redbridge and Enfield it is on the verge of stopping.

Most courteously, I remind the Minister that paragraph 5.30 of the White Paper of March 1998, A Mayor and Assembly for London, states: Transport for London will acquire specific responsibility for the Dial-a-Ride and Taxicard schemes. Following a review of door-to-door transport services in London, we are convinced that a better service to users could be secured at a lower cost to taxpayers and council tax payers if these services were rationalised. Therefore does the Minister believe that such provision should be in the Bill? I accept that this is a massive Bill. But perhaps the noble Lord would be kind enough to consider putting such provision again into the Bill in some form.

I am never quite sure—it always occurs when my noble friend Lord Renton speaks—of the wording of the amendment or on what page of the Bill it should be inserted. So I do not say to the Minister, "This is what I want. This is how I want it worded", because the wily and cunning lawyer, my noble friend Lord Renton, will explain to me later how it should be done. But it is the Minister who will have to bring back the matter to the House. Therefore I ask the noble Lord to consider bringing these two matters back at a later stage.

Lord Morris of Manchester

Like the noble Lord, Lord Renton, and the noble Baroness, Lady Darcy de Knayth, I am a patron of Greater London Action on Disability and I pay tribute again today to its work in the service of disabled people. While I shall be speaking mainly to Amendment No. 250, I am grateful to both the noble Lord, Lord Swinfen, and the noble Baroness, Lady Gardner, for facilitating this debate.

The purpose of Amendment No. 250 is wholly unexceptionable. It is about ending a very hurtful form of discrimination against disabled and elderly people; namely, their exclusion from transport services of crucial importance to their quality of life. There are between 250,000 and 500,000 disabled and older Londoners who cannot use regular public transport even when it is physically accessible. There are over 200,000 Londoners who cannot walk 100 yards and whose nearest bus stop is more than 100 yards from their home. What use are mainstream bus services to them?

These Londoners need special transport provision such as Taxicard and Dial-a-Ride which now provide 1.5 million trips a year. But these are not provided as a statutory duty. They are partly funded by voluntary contributions from the London boroughs. To ensure the continuation and development of these special transport schemes, Parliament should place a clear duty on Transport for London to make provision for them. We must not leave all discretion to the mayor. The organisations of and for disabled and elderly people feel that the Government recognise their special needs but are content to leave it to others to decide how or whether they are met.

Action to meet their needs ought not to be decided by personal whim but by the political will of Parliament. I hope very much that my noble friend can offer a helpful reply to the amendments. I hope, too, that he is giving very careful consideration to the response of the Joint Committee on Mobility for Disabled People, of which I informed him by letter, to the debate on my amendments on charging. I repeat: these are important amendments. They deserve a positive reply.

Lord Swinfen

Before the noble Lord sits down, I wonder whether I heard him correctly at the beginning of his speech. I may not have done so because, as he knows, I am rather deaf. I thought I heard him say that Amendment No. 250 was unacceptable. Am I right in thinking that he meant acceptable?

Lord Morris of Manchester

I said and meant unexceptionable. The very opposite of what the noble Lord, Lord Swinfen, may have feared.

Lord Brabazon of Tara

I heard the noble Lord right; he did say unexceptionable. We on these Benches in general terms support the principle behind these amendments. I am not certain which of the two is the better one. We believe that the facilities which are available to the disabled—there has been discussion on Taxicard and Dial-a-Ride—should certainly become better under the new system and there should not be any danger that they should become worse. From what one has heard in the debate this afternoon, it appears that they may be getting worse in certain places.

When I first saw Amendment No. 250, I worried that it might involve the London Underground possibly being made accessible to wheelchairs. Some figures were calculated once on how much it would cost and it amounted to billions of pounds. It is not only at the bottom of escalators where there are usually steps. There are many stations—particularly on the Piccadilly Line—which have no surface structure where, in order to get to the ticket hall, one has to go down steps and where I suspect it would be quite impossible physically to put in a lift. However, we on these Benches would like to support the principle behind these amendments. I do not know which is the better one of the two, but I hope that the Minister will be able to give a sympathetic response.

Lord Whitty

I do understand the concerns behind these amendments. With regard to Amendment No. 250, the noble Lord, Lord Swinfen, recognised that it was drafted in such a way that it would run into some of the difficulties which both my noble friend Lord Berkeley and the noble Lord, Lord Brabazon, have mentioned. It would imply a very onerous duty—far greater than on any other public authority—but also one which would override other priorities for TfL. One thinks in particular of the physically difficult problem which the noble Lord, Lord Brabazon, has graphically outlined in relation to 100 year old London Underground stations.

In its present form, we could not accept that amendment. In one sense, the noble Lord was focusing on a much more limited area but one of absolute essential importance for the disabled; namely, their ability to obtain door-to-door transport and the mayor and TfL's responsibility for that. I shall mention that in a moment.

In relation to new Amendment No. 287, the noble Baroness, Lady Gardner, is right that it bears a striking resemblance to Clause 169 of the original Bill. My honourable friend Glenda Jackson removed that clause for two reasons: partly because the other provisions in the Bill gave the mayor and TfL all the necessary duties and powers to ensure that transport issues affecting disabled people could be properly dealt with and will be taken into account in all the relevant details with the authority; and because we felt that the clause as it stood would put all responsibility on the Secretary of State to which by and large there has been some objection in this House. The clause as it stands would require the Secretary of State to issue orders and directions, whereas that ought to be part of the mayor's own responsibilities and, through the mayor, TfL's.

Several noble Lords have mentioned activity which is going on to improve the accessibility of transport to the disabled and others with mobility problems; in particular, the new regulations, which will be coming in over the next few years, affecting trains, buses and taxis and new stations. Clearly that cannot be done overnight and many disabled, elderly and other people with mobility problems will find it difficult if there are not adequate door-to-door services.

Under the present draft, we place the responsibility very clearly on the mayor, who will of course also be bound by the provisions of the Disability Discrimination Act, but with an additional requirement which was passed rather late the evening before last—I seem to spend all my time in this Committee—on Clause 124(2)(a), which requires the mayor's strategy to contain the mayor's proposals for transport which is accessible to those with mobility problems. That leaves some flexibility with the mayor. But it is also important that the mayor has that requirement and that it is also reflected in the fact that the London borough local implementation plans must contain proposals for implementing that strategy. Therefore, this is written in the Bill as it stands both at the GLAffIL and at the London borough level.

This applies in the area of Dial-a-Ride and Taxicard. Dedicated door-to-door services in London are apparently provided by those schemes. Dial-a-Ride is run by six independent companies. Taxicard is a borough-operated scheme covering 29 of the boroughs. Both schemes are very important and need to be developed for disabled people to pre-book door-to-door transport, mainly by telephone. For Dial-a-Ride, transport is provided by small bus. Individual taxis provide services under Taxicard.

As was indicated in our White Paper—I think the noble Lord, Lord Archer, referred to this—responsibility for Dial-a-Ride and Taxicard will transfer to the new authority. Thereafter, we would envisage a progressive transfer of other door-to-door services where this can be shown to be of benefit to the users and with the agreement of the other service providers.

Dial-a-Ride, currently funded by London Transport, will, as an LT responsibility, transfer automatically to Transport for London. Amendment No. 259D, a government amendment, will enable TfL to cont:inue giving grant to the Dial-a-Ride organisations as London Transport now does. The mayor will also be able to take responsibility for Taxicard or operate a similar scheme. However, some flexibility is needed. We acknowledge that Taxicard is not a uniform scheme—indeed that was pointed out—and the mayor will be able to indicate the best development from Taxicard or services similar to it, and the boroughs will have to reflect the mayor's approach in their own local implementation plan as I have indicated.

The mayor will want to consider the benefits of further co-ordination or voluntary integration of other types of door-to-door services. These could include such areas as social services day care transport and indeed transport for children with special needs. It is a big area but it is absolutely clear that Clause 124 places the responsibility on the mayor to provide this kind of transport which is accessible to all of those with mobility problems.

Through that, he therefore will need to decide, among other things, on the exact timing and nature of the transfer of Taxicard and the future development of Taxicard and Dial-a-Ride and to do so in conjunction with the London boroughs.

As it stands, Amendment No. 250 would place too wide, too onerous and too expensive a duty on TfL; but the mayor, under provisions which already exist in the Bill and the particular responsibility set out in Clause 124, has responsibility to take account of and develop exactly the kind of services that the noble Lord and noble Baroness, Lady Darcy de Knayth, were concerned with. I hope that noble Lords will recognise that there is no need for these amendments given the commitments and the implications of the earlier responsibility.

5.30 p.m.

Baroness Darcy de Knayth

Before the noble Lord decides what to do, perhaps I may ask for clarification. Let us suppose that it does not work out and that, heaven forfend, the boroughs do not do what the mayor is saying. The Minister said that under Amendment No. 287 the Secretary of State was obliged to make regulations, but I believe that it states that he "may" make regulations. Would not the amendment be a useful stop-gap if there were any problem?

Lord Whitty

By putting that clause at this point in the Bill it would appear to place responsibility on the Secretary of State. Our provisions would place responsibility on the mayor and that arises in Clause 134. However, if other procedures are observed, that does not prevent the Secretary of State making other directions.

Baroness Darcy de Knayth

I shall read what the Minister has said, but I believe that it would be a useful stop-gap.

Lord Renton

I must make a correction. I referred to Chapter X. That was a slip of the tongue. I should have referred to Chapter VII because that deals with travel concessions.

Lord Swinfen

I shall leave my noble friend Lady Gardner of Parkes to decide what she wishes to do with her amendment, Amendment No. 287, when we reach it somewhat later in the debate. However, her suggestion of including in the Bill a definition of a disabled person is useful. The definition in the Disability Discrimination Act may be useful, but let us consider that between now and the next stage of the Bill.

The noble Lord, Lord Berkeley, and my noble friend Lord Brabazon were right to point out the costs of making the whole Underground system accessible to people with all kinds of disability. That was never what I intended. I realise that it would be impractical and that the costs would be horrific.

I am delighted with the support I have received for the amendments from all sides of the Committee and with the Minister's support for the idea which lies behind them. I should like to read what he and other Members have said and possibly come back with them at a later stage. In the mean time, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Baroness Thomas of Walliswood moved Amendment No. 250ZA: Page 72, line 11, at end insert— ("() Transport for London may, with the approval of the Mayor and Assembly, borrow money for investing in transport in Greater London.")

The noble Baroness said: The amendment has a history. It was tabled by my honourable friend in another place and supported in Committee by the Conservative Members. Amendment No. 225D in the name of the noble Lord, Lord Sheppard of Didgemere, and my noble friend proposed that the GLA could issue a loan instrument secured on revenue-bringing charges and levies. When we discussed it in Committee on Monday this week, the noble Lord, Lord Brabazon of Tara, suggested that the idea might be better located in this part of the Bill. Therefore, I hope that the noble Lord and his noble friends will continue to be broadly supportive of these borrowing powers.

The purpose of Amendment No. 250ZA is straightforward; namely, to give the new functional body, Transport for London, the power to borrow money to invest in transport in London. The new functional body will have large assets and important duties to deliver, or cause to be delivered, over a wide range of transport for the people of the Greater London area.

However, the amendment raises wider issues. In response to the amendment, the Minister in another place said that under the Local Government Act, TfL is enabled to borrow. But we are worried that that will be limited by the existence of short-term borrowings. Perhaps the Minister can respond to that issue.

I should also like to hear in layman's language how the Government see Transport for London's financial autonomy. There are a number of amendments on today's Marshalled List, but I find it difficult to understand how the Government see that particular aspect of Transport for London. I beg to move.

Lord Brabazon of Tara

During our debate on Monday on Amendment No. 225D, I did not realise that the noble Baroness had tabled this amendment relating to Transport for London. I am pleased that we are together on the issue and to be reminded that it was supported by my honourable friends in another place.

We support the idea in principle. Reflecting upon my suggestion that the borrowing should be against revenue streams from congestion and parking charging, I now believe that that would be too restrictive. It should be for the lender to decide how he wants the loan to be secured. Furthermore, it must be made clear that the borrowing must be in the market, so getting away from the public sector borrowing requirement, as happened in the case of local authority airports which are now allowed to borrow outside the PSBR. The Minister said that they were commercial organisations. I hope to goodness that Transport for London will be a commercial organisation, taking over from London Transport which tries its best to be a commercial organisation.

I do not intend to speak any longer on this issue. We shall wish to return to it at the next stage of the Bill.

Lord Clement-Jones

I support the amendment. It follows closely on Amendments Nos. 224F and 225D, which covered the GLA as a whole. However, this amendment relates only to Transport for London.

In Committee on Monday, the Minister said: Their expenditure through borrowing increases public expenditure and, ultimately, exposes the Treasury. Our aim is to ensure that borrowing by the GLA is subject to the same system of control as applies in other areas".—[Official Report, 28/6/99: col. 105.] I hope that the Minister's response to this more limited amendment is more positive. The Government's argument on borrowing powers is wholly circular. Borrowing by Transport for London or the GLA is public borrowing because the Treasury says it is. That argument was used by Humpty Dumpty in Alice Through the Looking Glass who said. "When I use a word it means what I choose it to mean." It is interesting that the Treasury should be using Humpty Dumpty arguments nowadays.

The fact is that the Government, when they choose, can exclude certain types of borrowing from "public borrowing" under the PSBR. Some regional airports have been excluded, as have the new guaranteed bonds by the Channel tunnel rail link. They are not treated as coming under the PSBR. If the rules were changed, there would be no need for the complicated, expensive and, we believe, ultimately doomed proposals for PPP which we shall discuss later. I hope that the Government will take a more flexible view on the issue and consider the amendment carefully.

Lord Whitty

We covered a great deal of the ground on Monday. The central point is that Amendment No. 250ZA adds nothing to the Bill because the rest of it places TfL, as a local authority body, within the local authority finance regime. The Bill already confers powers to borrow money on TfL. Clause 96(2) makes TfL and the other functional bodies local authorities for the purposes of Part IV of the Local Government and Housing Act 1989, of which Section 46 provides that as part of the proper management of its affairs the local authority may borrow money for any purpose relevant to its functions. That remains the case in relation to TfL.

Therefore, the power to borrow money is clear. It is a question of the regime under which that borrowing takes place. We have said that TfL will be treated as a local authority. Accepting the amendment would not take TfL out of that system of regulation and, as with other local authorities, TfL's borrowing will be controlled through the issue of credit approvals.

The amount of a body's credit approvals is estimated in the capital spending plan. The assembly has a role in being consulted about that plan. The sources of funding for Transport for London will be diffuse. It will have its own ordinary revenue from fares and the GLA transport grant, which will comprise grants currently given to predecessor bodies, such as London Transport. The mayor can give TfL money from the GLA grant.

The revenues from road user charging and workplace parking charges will accrue to TfL and it can borrow in the same way as any other local authority body.

The noble Lord, Lord Clement-Jones, said that this is a circular argument. However, this situation applies not only in this country; the Maastricht criteria effectively define borrowing by such a public body as public borrowing in all European Union countries. The PSBR is not a term that we use any more. We use the post-Maastricht terms—

Baroness Thomas of Walliswood

I apologise for interrupting the Minister in full flow. The noble Lord, Lord Brabazon of Tara, made the interesting point that if TfL was allowed to borrow in the market there was no possibility that its borrowing could be considered as contributing to the public sector borrowing requirement. It would be borrowing from the total pool of money available for lenders to lend. It would not be creating a new money source.

Lord Clement-Jones

Perhaps I might make that a "double-barrelled" question. Can the Minister explain why the Government are able to exclude from the PSBR those regional airports and, indeed, the Channel tunnel rail link?

Lord Whitty

The Channel tunnel rail link is a complicated matter which I do not propose to go into today. As regards the commercial airports, which are perhaps more directly analogous, they are effectively limited companies owned by the public sector. When I say that they operate as commercial entities, they are totally commercial entities. TfL, as a body, has both commercial and non-commercial aspects. Therefore, it is appropriate to treat it as a public body, as with many other public bodies.

This is not as constraining a regime as noble Lords seem to think. Clearly, the viability of future revenues is one of the considerations to be taken into account if TfL or any other public body applies for credit approval. Credit approval will be assessed with a view to TfL being able to deliver on all the duties imposed on it by the Bill.

The idea that taking it out of the local authority regime would give greater access to resources than the proposals we are putting forward is probably not a logical conclusion. At any rate, the amendment, if passed, would not, of itself, take TfL out of the local authority regime.

Baroness Hamwee

I accept the last point with regard to the way the clause is drafted. At this stage we are exploring the general principles. As his penultimate point, the Minister argued that this type of approach does not add to the sources of borrowing that may be available. However, we are seeking to remove the hurdle of the approval of the Secretary of State. I wonder whether the Minister can comment on that as it may be valuable for our debate at the next stage.

The noble Lord, Lord Brabazon of Tara, raised an interesting point. It is really for the lender to express a view—more than a view; a requirement—as to the property to be charged; that is, the assets to which the lender will look in making funds available to TfL as the borrower. Can the Minister comment on the role of the Secretary of State in blocking funds which would otherwise have been made available, as the noble Lord, Lord Brabazon of Tara suggests? It seems to me inappropriate for the Secretary of State to say, "No, you may not borrow. I accept that your lender is satisfied as to the security to be given, but I know better".

Lord Whitty

I am not entirely sure that I follow the question raised by the noble Baroness.

Baroness Hamwee

I am happy to repeat it.

Lord Whitty

Perhaps I may study the question and write in detail to the noble Baroness. The issue is not what the lender feels, or whether the lender is the public or private sector. Whoever lends the money, public expenditure by this public body will increase. That is straightforward and logical.

I thought that the noble Baroness was suggesting that the Secretary of State might veto access to private finance. That is not the way the system works. We shall work under the local authority credit approval process. The Secretary of State does not have any other parallel power. Once that process has been gone through, the credit approval is there.

Baroness Thomas of Walliswood

I do not believe that we shall get much further today with the amendment. We have listened to an interesting series of speeches from both sides of the House. We shall go away and consider them carefully. I suspect that we may well bring this back again at a later stage. In the mean time, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 133 agreed to.

5.45 p.m.

Schedule 8 [Transport for London]:

Lord Whitty moved Amendment No. 250A: Page 206, line 13, leave out ("its functions under this Act") and insert ("any of its functions")

The noble Lord said: In moving this amendment I shall speak also to Amendments Nos. 256B, 256E, 258B to 258Z, 259A to 259C, 261A and 265A. These are all relatively technical amendments which tidy up the position relating to TfL.

Amendment No. 250A is a technical amendment to Schedule 8. Paragraph 1(3) allows TfL to do things which will facilitate or are conducive or incidental to the discharge of its functions under this Act. However, ill, will have functions under other legislation; for example, highway and traffic functions, and they also need to be covered. Amendment No. 250A makes clear that it can do that.

The rest of this group of amendments are technical improvements to Schedule 9 which deal with the detailed operating powers of TfL. Schedule 9 is very similar to the enacted legislation from which London Regional Transport derives its operating powers; that is, Schedule 2 of the London Regional Transport Act 1984.

The amendments do, however, give TfL two powers not previously available to LRT: the power to form joint venture companies and the power to provide transport facilities without having to provide services to them.

Amendment No. 256B amends Clause 136 to give TfL the power to form joint venture companies with private partners for the carrying on of activities which TfL does not have power to carry on. Currently, LRT cannot do that. Although it can form companies with other persons, those companies cannot undertake activities for which LT does not have powers. This has prevented LT from carrying out a number of worthwhile activities, such as the White Card, which is a single ticket allowing entry to a number of London museums. The London Transport Museum has been unable to take part in that initiative because of the lack of London Transport's powers to act in that area.

We believe that such a power will be useful to TfL in that it will be able to undertake innovative projects such as the White Card system, but it will not give TfL carte blanche—excuse the pun—to embark on speculative ventures. The activities of any company formed under this provision must include those activities for which TfL does have power, as well as other activities for which it does not.

Amendments Nos. 258D to 258F make it clear that TfL can provide transport facilities without itself having to provide services to and from those facilities. Although London Transport currently has power to provide incidental facilities (like car parks) it cannot provide "core" transport facilities without running services to and from them. This effectively prevents it from providing such things as river piers without operating services from them. It is entirely possible that TfL will want to provide facilities without services, and this amendment allows it to do just that.

Amendments Nos. 256E, 258H to 258T, 258V, 258X, 258Y and 259A replace references to TfL's "business" with references to "functions". That is because although TfL will be a trading organisation in some ways (for example, its sale of tickets), it will also be a regulatory body in respect of taxi and bus licensing, for example.

Amendment No. 258B, together with 258C, are technical amendments to divide the existing paragraph 3 of Schedule 9. The effect is to create a new paragraph 3A, extending TfL's power to use surplus premises for the storage of goods not carried by TfL. That means that TfL can use any of its surplus premises for that purpose, and not just premises it uses for the storage of goods which TfL carries.

Amendment No. 258G adds the word "or" to paragraph 9 of Schedule 9 to make it clear that TfL can provide "professional or technical advice" rather than "professional technical advice". Amendment No 258GA makes clear that TfL can charge for anything done under its powers in paragraph 9 of Schedule 9 to provide technical assistance and advice.

Amendment No. 258U brings TfL's compulsory purchase powers into line with those of the London Development Agency, by requiring TfL to obtain the mayor's consent before asking the Secretary of State to confirm a compulsory purchase order. Amendment No. 258W is a typographical correction. It ensures that TfL's powers of compulsory purchase are the same as London Transport's, subject only to the changes necessary to reflect the creation of Tfl, and the GLA.

Amendment No. 258Z removes the need for TfL to obtain the consent of the Secretary of State before acquiring any securities of a body corporate for the purposes of discharging its functions. Amendment No. 259B is a minor technical amendment, being a cross-reference. Amendment No. 259C amends paragraph 29 of Schedule 9 so that TfL may do anything necessary for the purposes of fulfilling a contract entered into by any of its predecessor bodies.

I hope the need for these amendments is clear. They tidy up the power; and in some cases extend them in sensible areas beyond those currently held by London Transport and other predecessor bodies. I beg to move.

Lord Berkeley

Perhaps I can ask my noble friend two short questions. I believe my noble friend said that Amendment No. 258D would enable TfL to build transport facilities but not operate them. Would that include something like rebuilding Victoria coach station without the need to operate coaches to it? I believe the answer is yes, but I shall be grateful for his confirmation.

My second question relates to the word "goods". My ears pricked up as soon as I heard that word. I cannot remember to which amendment it relates because my noble friend was rattling through them nice and quickly. It allows TIL to store goods in places where goods would not normally be stored. Is this the start of a major intermodal facility in London for the transfer of freight from road to rail; or does it relate to Schedule 9, line 37 at page 210, Transport for London may also carry luggage and other goods"? I am not sure what the definition of "goods" is in those two contexts and whether they are the same. I shall be grateful for an explanation from my noble friend.

Lord Whitty

On the latter point, my understanding is—I will correct this in writing if I am wrong—that the reference to luggage and other goods merely relates to goods similar to luggage. In other words, they can carry luggage separately from passengers. If one is travelling with an artist's easel, that could be put in with the luggage, though strictly speaking it is not a case. So it is not creating a new freight company, if that was my noble friend's concern.

In relation to Victoria coach station, conceivably the situation would be covered. I cannot see the circumstances in which it would arise, but it would definitely be covered. In terms of being able to store goods outside its own normal provision, in most cases the situation is probably more limited in that TfL would be able to use its own storage facilities for other people's goods if the storage was surplus to its requirements. It could, however, lead to substantially greater things, as my noble friend implied.

Lord Brabazon of Tara

We on these Benches are grateful to the noble Lord for his detailed explanation of this large group of amendments and congratulate him on moving such a large group in one go. We will need to study the amended Bill at the end of Committee stage and we reserve our position until then.

Baroness Miller of Chilthorne Domer

We will also be studying the results of these amendments. I have a small query in relation to Amendment No. 265A where the Minister is proposing to leave out the "Secretary of State" and insert the "Mayor". But, as I read that, if the mayor ended up being chairman of Transport for London, he would effectively be giving consent to himself. Perhaps the Minister could clarify that for me.

Lord Whitty

He would be giving consent to TfL as an organisation rather than to himself. Nevertheless, the noble Baroness has a point which needs some explanation and I undertake to write to her.

On Question, amendment agreed to.

Baroness Thomas of Walliswood moved Amendment No. 250B: Page 206, line 15, after ("to") insert ("sub-paragraph (1A) and")

The noble Baroness said: These amendments do a number of reasonably simple things. Amendment No. 250C requires the assembly's approval by a simple majority for an appointment made to the TfL board by the mayor. Amendment No. 250B is the paving amendment for that amendment. Amendment No. 251B would allow the assembly a say in the determination of the terms and conditions of TfL board members. Amendment No. 251 C would require the mayor to seek the approval of the assembly by a simple majority for the removal of a TfL member. That refers to the fact that the assembly could approve the appointment. Finally, Amendment No. 252A would allow the assembly a say in the appointment of the chair of Transport for London. I beg to move.

Baroness Farrington of Ribbleton

The noble Baroness, Lady Thomas of Walliswood, clearly described the purpose of her amendments. However, I believe that they are based on a misunderstanding of the relationship between the mayor and TfL and the mayor and the assembly.

TfL's major role will be to deliver the mayor's transport strategy. TfL is the mayor's executive body, and a vital tool for him or her in delivering the improvements to transport in London which I know we all want to see. It is the mayor who will be accountable to the people of London for his or her performance on transport. The buck will stop with the mayor. The mayor must be able to appoint to the TfL board people whom she or he believes are the best for the job.

It is vital that the key management and leadership roles of chairman and deputy chairman are filled by people in whom the mayor has confidence. As we said in the White Paper, posts will be advertised and selection will be on merit with an independent element in the selection process following normal public service procedure. We have also said that we will expect the mayor, in line with Nolan procedures, to involve an independent element in the appointments process, and that we will provide guidance on that. This will safeguard against the mayor packing the board.

Turning to Amendments Nos. 251B and 252A, if it is the mayor's responsibility to appoint members it must also be for the mayor to decide on what terms and conditions they should be appointed and in what circumstances a member should be removed. If the mayor feels that a member is not up to the job, she or he must be able to do something about it without having to go through a complex and inappropriate procedure.

6 p.m.

Baroness Thomas of Walliswood

I heard what the Minister said. However, it is not so much that we do not understand, but rather that there is a fundamental disagreement between us as regards the desirable relative roles of the mayor, the assembly and, indeed, the Secretary of State. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 250C not moved.]

Lord Swinfen moved Amendment No. 251: Page 206, line 32, at end insert— ("(3A) The Mayor shall appoint as members of Transport for London—

1. (a) a person who has personal experience of being a disabled person; and
2. (b) a person who is an older person.")

The noble Lord said: In moving this amendment, I shall speak also to Amendments Nos. 252, 267, 268, 269, 271 and 273. In no way dare I even seek to emulate the performance of the noble Lord, Lord Whitty, with the number of amendments that he moved in one group; indeed, it was magnificent.

I shall begin with Amendments Nos. 251 and 252, the purpose of which is to ensure that Transport for London, through its board members, is fully and properly informed of the needs, views and wishes of disabled and older Londoners. Schedule 8 to the Bill requires the mayor to, have regard to the desirability of ensuring that the … membership of Transport for London represents the interests in relation to transport … of persons who require transport which is accessible to persons with mobility problems".

Older and disabled people, and their organisations, believe that the best way of achieving that is for the TfL board to have members who are older and disabled and that these members should be supported and informed by a forum of organisations of older and disabled people.

The Government's commitment to best value and social inclusion argues that the best advocates for services are the service users themselves. Older and disabled people and their organisations do not feel that it is sufficient for the mayor to appoint as their representatives people who have no democratic mandate and who may know little of the needs of older and disabled people, other than their personal experience.

Amendments Nos. 267, 268, 269 and 273 have the purpose of ensuring that whenever Transport for London proposes to introduce a new local bus service or vary an existing one the impact on older and disabled people is taken into account through consultation. Clause 148 requires TfL to consult various interests when proposing to introduce a new bus service or vary an existing one. These amendments seek to add, organisations of older and disabled people", to the list of statutory consultees, and, the effect of the proposal on older and disabled people", to the list of matters about which consultation must take place.

Disabled and older people are particularly dependent on buses, being usually poorer and less frequently owning cars or having access to cars. Indeed, some 72 per cent of London pensioners do not own a car. Buses are the form of transport that goes closest to people's homes. It is disabled and older people who have more to gain and, more importantly, more to lose from developments in London's transport than other members of the population.

Amendment No. 271, which really needs to run with Amendments Nos. 267, 268, 269 and 273, is designed to ensure that the mayor's guidance on granting permits to run bus services outside the London bus network protects the interests of disabled and older people by identifying the interests of those who must be consulted in the preparation or revision of the guidance. The amendments seek to add the same list of statutory consultees to the mayor's consultation as regards his guidance on the granting of London bus service permits. I beg to move.

Baroness Darcy de Knayth

As I have added my name to these amendments, I should like briefly and warmly to support the whole group. It is totally sensible and logical for TfL to have individual members with experience of age and disability, backed up by a forum of organisations with experience; indeed, LATA already exists. Obviously, before any change in a bus service or before granting bus service permits, the relevant organisations should be consulted about the likely impact. The Minister may well say that this is quite unnecessary because they are all so obvious. However, while there is much more awareness about these issues nowadays, things can be overlooked, forgotten or swept aside and the resulting chaos can be difficult and often expensive to put right.

Baroness Thomas of Walliswood

My name has been attached to some of these amendments. I should like to ask the Minister a fairly straightforward question. Can the noble Lord say how the Government, and the Bill, foresee the consultation process with regard to these particular users of transport? The Minister mentioned guidance in relation to the membership of Transport for London. Will that guidance indicate that it would be desirable to have persons who represent disabled or older people on the TfL board?

Lord Whitty

The first of these amendments deals with representation on the TfL board. In one sense, there is no specification as to what organisations people on the board should come from. But under paragraph 2(3) of Schedule 8 the mayor will be under the duty to have regard to the desirability of ensuring that the membership of TfL represents the interests of those who require accessible transport. We do not believe that we should lay down in the Bill precisely how the interests of those needing accessible transport, including the disabled, should be represented on the TfL board. Indeed, that would cut across the general approach to membership of the board. However, believe that the provision in Schedule 8 meets the requirement in the amendments that people with experience of age and disability should be on the board. If we start specifying such organisations, there may well be more difficult problems.

As regards consultation, with which the remaining amendments deal, there is clearly some concern that what I keep calling the "implication of the Bill" is not for real unless you have an amendment of this nature. I shall try, once again, to indicate where the consultation under the Bill as drafted would meet the aims of the noble Lord, Lord Swinfen, and other Members of the Committee who have spoken. The reference in Clause 27 of the Bill to "voluntary bodies" will, in practice, ensure that consultation occurs with representatives of disabled people.

When drawing up the transport strategy, the mayor must consider consulting those voluntary bodies. Under Clause 124, the strategy must contain the mayor's proposals for transport which is accessible to those with mobility problems. The logic of that is that the mayor has to consult all those with an interest; in other words, he must consult voluntary bodies representing those with mobility problems and the disabled. Admittedly, it is more explicit in relation to the local boroughs in Clause 127 where the local implementation plans must contain a borough's proposal for implementing a strategy in its area. That explicitly provides that boroughs will be under a duty to consult organisations representing disabled people when drawing up their local implementation plans. It is also explicitly stated in the Bill that the London Transport Users' Committee must be consulted in this whole process. The LTUC, like the LRPC, has people to advise it on matters relating to accessibility and mobility. There is no reason why the LTUC should be difficult in this regard.

We contend that the present requirements of the Bill indicate that disabled groups must be consulted through the logic of the interplay of the various clauses. However, I suspect that noble Lords will continue to raise this issue unless it is explicitly spelt out, or they feel after reading Hansard that my words are so explicit that there is no further need to raise the issue. If the Committee will allow me, I shall consult further on the matter of how we meet what is an obvious concern, but one which we feel has already been met in the Bill as drafted.

Lord Avebury

I hope that I may put one more point to the Minister before we finish with this series of amendments. I refer to the membership of Transport for London as opposed to the consultations. The Minister is saying that the point that is raised in the amendment has already been taken care of in paragraph 2(3) to Schedule 8, but that states only that members of Transport for London will represent, the interests in relation to transport … of persons who require transport which is accessible to persons with mobility problems". However, that provision could be satisfied by the appointment, for example, of an official of Age Concern or an official of the Disablement Income Group. It does not mean to say that there is an elderly or a disabled person on TfL. It is important that the membership of TfL should comprise such people. After all, subparagraph (4) states who is specifically excluded from being a member of TfL. There is a long list of people who cannot be appointed in this capacity. Therefore, why should we not have on the face of the Bill a provision which states that the membership shall include members of a particular class? Is that not the best way to ensure that the knowledge and experience of elderly or disabled persons are brought into the counsels of TfL and are not carried there indirectly by someone who merely represents the interests of those persons?

Lord Whitty

I am not sure that the amendment would meet the point that the noble Lord, Lord Avebury, now makes. I am not sure that I agree with his approach. If the interests and the experience he mentioned are represented, they can be represented directly or indirectly. It is a matter of judgment and acceptability as to how they are represented. If we start to prescribe on the face of the Bill precisely how any particular interests should be represented—in this case the interests of the disabled and others with mobility problems—I believe that we shall go down a far too prescriptive channel. One could possibly become more exclusive than inclusive by so doing.

Schedule 8 requires the mayor to, have regard to the desirability of ensuring that the … membership of Transport for London represents the interests of those who require accessible transport. That leaves some element of flexibility as to how those interests are represented. However, it makes it absolutely clear that they should be represented. While I understand the concern that some provision should be included as regards the consultation side—although I do not think that is necessary—it could be counter-productive in terms of membership if we were to be too prescriptive here.

Lord Morris of Manchester

I thank my noble friend for giving way. Am I right in thinking that before the intervention of the noble Lord, Lord Avebury, he was telling us that he has it in mind to bring a government amendment before the House at the Report stage that will meet the concerns expressed by the noble Lord, Lord Swinfen, the noble Baroness, Lady Darcy de Knayth, and myself among others? I am quite sure he appreciates that all the signatories of these amendments genuinely feel that they have raised a point of real substance, but can we hope that he will bring forward a government amendment at the Report stage to try to meet our concerns?

6.15 p.m.

Lord Whitty

My noble friend has exaggerated slightly what I said. That is clearly one option, but I said that because I believe that as this matter has been raised two or three times there is obviously concern that what we think is a logical reading of the Bill as it stands is not sufficient to reassure people. I am prepared to consider whether there are other ways in which we can reassure people. That concern may be satisfied by people reading Hansard and feeling that I have made a more explicit commitment. It may be satisfied by means of an amendment to the Bill. All I said was that I would be prepared to consider the matter further. It will obviously be up to the House to decide whether I have taken sufficient action by the next stage of the Bill to meet the concerns that have been expressed.

Lord Swinfen

I thank those from all sides of the Chamber who have supported this group of amendments. I am delighted that the Minister said that he would consult on the matter. I did not hear him give a commitment to bring forward a government amendment. However, he may do so at Report stage; we do not know. If I recall correctly, some years ago at the time of the privatisation of the railways and the privatisation and deregulation of the national bus companies, I had the support of the party opposite for similar amendments that I moved at that time to both those pieces of legislation. Therefore I hope that the Minister will feel that he can move considerably to counter the concerns that I have raised on behalf of disabled and elderly people. It was not my intention to press any of these amendments this evening. I sought to find out the Government's view on this matter. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Baroness Miller of Chilthorne Domer moved Amendment No. 251A: Page 206, leave out line 34

The noble Baroness said: This amendment seeks to allow assembly members to be members of Transport for London. It seems too prescriptive to say that no assembly members should be members of TfL. Although I can understand that the Government would not want members of what is supposed to be the scrutiny body to pack the TfL board, there are often advantages in having people who belong to one body at least being represented on another. Although I think it is in the Government's mind that the mayor will choose to be a member of TfL, that will not necessarily occur. There are several examples of cases where the Government have shown that they like such dual membership. I refer to the Secretary of State's recent appointments to RDA boards. It is noticeable that many council leaders, and certainly councillors, have been appointed to those boards.

Further, leading members of authorities have been appointed to hospital boards. I realise the Minister will say that in the examples I have given one body is not scrutinising the other. However, experience shows that people involved in such bodies can bring their experience or expertise to other bodies. It is most unlikely that several assembly members would also be members of the TfL board. However, it seems a shame to exclude from membership of Tit an able assembly member who could contribute his experience when the mayor may choose not to be a member of that body. I beg to move.

Lord Brabazon of Tara

My Amendment No. 251AA has been included in the group that we are discussing although it addresses a rather different point. I merely want to know why Members of the House of Lords—I should emphasise straightaway that I am not looking for a job for myself—should not be allowed to be appointed members of the TfL board. There are many Members of your Lordships' House, including those on the Government Benches, who have wide experience of all the matters which are listed under Paragraph 2(3) to this schedule; namely, transport, finance and commerce, national and local government, trades unions and so on. We are described as an "amateur" House. Nearly all of us in this House—except, of course, Ministers—also have outside occupations.

I can understand the reasons for not allowing the other people listed under sub-paragraph (4)—the Welsh will be in Wales, the Scots in Scotland and, hopefully, the Northern Irish in Northern Ireland; Members of the European Parliament will be in Strasbourg or Brussels; they will not be residents of London—but I cannot see why Members of the House of Lords should be barred from being members of the board of TfL.

Baroness Farrington of Ribbleton

I will speak first to Amendment No. 251A, which would remove the bar on assembly members being appointed to the board of Transport for London. Here we return to the difference between the role of the mayor and the role of the assembly. The noble Baroness, Lady Miller of Chilthorne Domer, gave the example of the boards of RDAs. Therein lies the difference. In that capacity the board is there to formulate policy; the role of members of the board of TfL is to implement the policy and strategy put forward by the mayor.

The noble Baroness gave an example of an assembly member with ability. That person's contribution in the scrutiny role of the assembly would be vital and extremely valuable, but it is not the role envisaged in her amendment. The TfL board is not intended to include elected political representatives, whether local or national. It has a different role to that of the mayor and that of the assembly. The assembly will have a scrutiny role; it will have to focus the spotlight on the performance of both the mayor and TfL in implementing determined policy. The assembly will also have a role in the approval of the overall GLA budget. It is not for assembly members to get involved in the running of TfL.

We cannot accept Amendment No. 251 AA, which was spoken to by the noble Lord, Lord Brabazon of Tara. However, vie have worded the disqualification relating to the House of Lords so that hereditary Peers who cease to be Members of the House of Lords will be eligible for appointment to the TfL board. It is only Members of the House of Lords, rather than Peers in general, who cannot be appointed to the TfL board.

I understand the reference of the noble Lord, Lord Brabazon of Tara, to the term "amateur" with regard to membership of the House of Lords. However, to imply that those who serve in other elected bodies—be they in Wales or elsewhere—will be too busy to serve on the TfL board but Members of the House of Lords will not be, is a very difficult proposition to convincingly put to the Whips' Office in the House of Lords.

I hope that the noble Baroness and the noble Lord will feel able to withdraw their amendments.

Baroness Carnegy of Lour

Before the noble Baroness sits down, may I say that I did not understand her last answer about membership of the House of Lords. I cannot see where the conflict of interest would be. I can think of lots of equivalent things that noble Lords do while being Members of the House of Lords; it has nothing to do with whether one is a hereditary Peer or not. I know the noble Baroness put that in as a light remark, but why should someone who knows everything about transport not be on the board just because he is a Member of the House of Lords? Can the noble Baroness explain where is the conflict of interest?

Baroness Farrington of Ribbleton

My remark was not a differentiation between hereditary and non-hereditary Peers but a differentiation between those who are Members of the House of Lords and those who in the future may not be Members. It is our view that the process of appcintment should exclude people who are politicians, locally or nationally. Quite clearly that covers this point.

Baroness Carnegy of Lour

Including Cross-Benchers?

Baroness Farrington of Ribbleton

My personal view is that it is possible to be political and to fulfil a highly political role without being party political.

Lord Brabazon of Tara

Before the noble Baroness decides what to do with her amendment, I really must come back to the Minister on mine. I know that the noble Baroness in her role as a Whip sometimes has difficulty in attracting some of her captains of industry to come to the House to support the Government in the Lobbies. Surely the point is that there are great and good Members of your Lordships' House who would be perfectly able to serve on the board of TfL. If they are able to be chairmen or main board directors of leading plcs in this country, which some of them are, they can just as well be members of TfL. I may very well return to this issue.

Baroness Thomas of Walliswood

The noble Lord, Lord Brabazon of Tara, has missed the point. If the noble Lord does not remain in the House, he will be able to sit on the board.

Lord Brabazon of Tara

That is not the point.

Baroness Thomas of Walliswood

That is what I understand the Minister told us. On the other hand, I, who cannot escape from being a Member of your Lordships' House, will not be able to sit on the board. I think that was the point the noble Baroness was making.

Lord Brabazon of Tara

With respect, I was not trying to draw a discrimination between hereditary and life Peers. Obviously if a hereditary Peer is no longer a Member of the House he will be able to be on the board of TfL. My point is, why should not life Peers who have distinguished records outside this House be able to be on the TfL board?

Baroness Miller of Chilthorne Domer

I wish to pass on to the Committee the comments, which you did not hear, of my noble friend Lord Avebury. He said that he regretted that Amendment No. 251AA will not be passed because that would secure certainly some elderly and disabled Members who would be able to serve on the board. I would not dare say that myself.

I thank the Minister for her definition of the roles. We on these Benches still cannot accept the extremely sharp divisions the Government wish to make between scrutiny, policy making and so on. At this stage I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 251AA not moved.]

Baroness Thomas of Walliswood moved Amendment No. 251B: Page 206, line 46, after ("Mayor") insert ("and Assembly")

The noble Baroness said: This is a very simple amendment. It seeks to remove the requirement that the mayor be the chair of Transport for London if he or she is a member of Transport for London. Not only do we think that the mayor will have quite enough to do without being chairman of Transport for London but the situation could draw one into unfortunate areas. When one reaches the section on appeals, one could get to the stage where the mayor is referring appeals to himself. We should perhaps look at some of the conflicts of interest which might arise if the mayor was automatically chairman of Transport for London. It does not suit very well the further construction of the parts of the Bill which deal with appeal processes. There may be other parts of the Bill which have the same problems attached to them. I beg to move.

6.30 p.m.

Lord Dixon-Smith

I think that we are slightly out of order. The Deputy Chairman of Committees called Amendment No. 251 B and not Amendment No. 252B, which has just been spoken to. It must be moved formally or withdrawn, as the case may be.

Baroness Farrington of Ribbleton

It may assist the noble Baroness if we take as read her points regarding Amendment No. 252B.

Baroness Thomas of Walliswood

I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 251C to 252A not moved.]

Baroness Thomas of Walliswood moved Amendment No. 252B: Page 207, leave out lines 8 and 9.

The noble Baroness said: I spoke to this amendment a few moments ago. I beg to move.

Lord Whitty

I am not sure whether I understood the noble Baroness correctly, but the objections that she raised in relation to a possible conflict would apply—if they apply at all—to the mayor, whether he or she were Chair or an ordinary board member. As I understand it, this amendment would remove the requirement that the mayor—if he or she so chooses—would have to be Chair.

The post of Chair of TfL is key and we think it is appropriate that the mayor, as the chief executive of London, should have the option of taking that position. If the mayor decides to be a member of the board, he or she should be Chair of the board. There would be an anomalous situation if the mayor were appointed as an ordinary member—or even as Deputy Chair. That would place the mayor in an odd situation whereby he or she would be subordinate to somebody who chaired a body that reported to the mayor. That would blur, rather than reinforce, the lines of responsibility.

I could understand it if the noble Baroness were arguing that the mayor should not be a board member at all—I do not agree with that view, but it is logical. However, if the mayor is a member, we believe that he or she should have the option to be the Chair.

Baroness Thomas of Walliswood

I will look carefully at the Minister's remarks and I shall re-examine the Bill's various references to the mayor's interacting with TfL. I think there are moments when the mayor would interact with himself or herself if he or she were both mayor and the Chair of TfL. For the moment, I withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Brabazon of Tara moved Amendment No. 253: Page 209, line 22, leave out ("not")

The noble Lord said: With the leave of the Committee, I shall speak both to this amendment and to Amendment No. 254.

These amendments deal with members' interests and the discussion of contracts. The Bill, as it is presently drafted, allows a member of Transport for London who has an interest to take part in discussions or even vote on any questions unless the mayor so directs. We, on these Benches, do not believe that a member who has an interest should be able to participate in discussions about these contracts or to vote on them.

We believe also that giving the mayor the discretion to allow that to happen could give rise to a clear conflict of interest as far as the mayor is concerned. We believe that the Bill would make for better legislation if we said simply that members of TfL with a special interest should not be able to take part in discussions on contracts. I beg to move.

Baroness Farrington of Ribbleton

It may assist the Committee if I say that we agree that the current provisions on interests are drawn too widely and must be tightened. We are currently considering our own amendments to the provisions, and will therefore take these amendments away to consider.

It is important to say that these amendments may go a little further than we would wish to go. Therefore, it is not possible to accept them as they stand. There will always be a balance to be struck between ensuring that the board has sufficient experience to be able to make wise decisions and ensuring that it is—and is seen to be—sufficiently impartial to make fair decisions.

There is a variety of different models from which to choose in seeking to achieve that balance. For example, we could follow the Environment Agency model. Members of the EA are prohibited from taking part in deliberation or discussion of any matters in which they have an interest, but the Secretary of State can disapply such a prohibition where the number of members of the agency disabled would be so great a proportion of the whole as to impede the transaction of business. This could be adapted so that the mayor, rather than the Secretary of State, had the power to disapply the prohibition. We believe that the power to disapply may be important and should be kept in reserve in order to ensure that a wide range of experience is represented on the board, making it most effective.

On the basis of my remarks, I hope that the noble Lord will feel able to withdraw his amendment.

Baroness Carnegy of Lour

In view of her local government experience, I am sure that the noble Baroness does not need advice from me. When a person giving permission to someone who has an interest to speak and vote is in close everyday communication with that person and with the body, it would be very different from the Secretary of State disapplying the prohibition in the case of the Environment Agency. The mayor will be in constant communication with the transport people and a quite awkward situation could arise. I am sure that the noble Baroness will look carefully at this matter—and my noble friend will be glad of that. I think there will be a small problem if we do not make a total prohibition.

Baroness Farrington of Ribbleton

My recollection of local government—I will, of course, write to the noble Baroness if I am wrong—is that the chief executive advises a member but the decision is taken by the member. Categories of people—for example, local authority tenants—may be excluded from being disbarred by the Secretary of State for the Environment, Transport and the Regions. However. I shall read the noble Baroness's comments carefully.

Baroness Thomas of Walliswood

Before the noble Lord responds, I must say how much I welcome the response from the noble Baroness the Minister. There is a small gap in the Bill in the form of what one might call the codes of conduct or codes of probity that normally surround these sorts of bodies. I wonder whether the Government might be encouraged to consider the possibility of issuing guidance or of making secondary legislation—or using any other suitable means of achieving the desired outcome—to establish some guide posts for how the conduct of members of Transport for London should fit into the evolving code of good practice and good conduct for people in public life in general.

Lord Brabazon of Tara

I am grateful to all of those who have taken part in this short discussion—my noble friend Lady Carnegy and the noble Baroness, Lady Thomas. I also thank the noble Baroness the Minister for her reply. I am delighted that she has promised to consider my points and produce some amendments, presumably on Report.

We got off to a good start today when I heard from the noble Lord, Lord Whiny, that he had added his name to my Amendment No. 294, and now I have gained a concession from the Minister regarding these two amendments. I am delighted about that, and I look forward to the outcome. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 254 not moved.]

Schedule 8 agreed to.

Clause 134 [Directions etc by the Mayor]:

Baroness Thomas of Walliswood moved amendment No. 254A: Page 72, line 14, after ("Mayor") insert ("and Assembly")

The noble Baroness said: This amendment would allow the assembly a say in the issuing of guidance and directions to TfL, currently carried out by the mayor. I know that Ministers feel that there should be a complete separation between the exercise of the powers of the assembly and the exercise of the powers of the mayor. But in other legislation which is either before this House or on its way, the scrutiny power of the assembly is, in other sorts of local authorities, to be allowed to be a prior scrutiny of what is going on. For that reason, we believe that the addition of the assembly to the mayor's role in issuing guidance and direction to Transport for London might fit into the way in which the Government are currently looking at the question of the division between the executive and what is sometimes called the scrutiny part of local government. I reject utterly the term "legislative" when applied to a body such as a local authority or an assembly. I beg to move.

Baroness Farrington of Ribbleton

The amendment would allow the assembly to take a major role in the day-to-day operations of TfL. We do not think that that is an appropriate role for the assembly. The assembly's role, as voted on by the people of London, is to provide a check on the major through its extensive powers of scrutiny.

The roles to be played by the mayor and the assembly are complementary, but not the same; they should not be confused. The assembly will rightly be consulted on the overall transport strategy; however, the detailed information of the overall strategy is best left to the mayor and TfL. TfL is the mayor's executive transport body. It will be for the mayor to provide political direction to TfL, not the assembly. The assembly's task is to scrutinise the performance of both the mayor and TfL. It would not be able to do that with the necessary degree of independence if it were as closely involved in the running of Tfl, as the amendment envisages. I therefore hope that the noble Baroness will feel able to withdraw her amendment.

Lord Avebury

Surely the amendment does not involve the assembly in the day-to-day management of these affairs. I do not know how often the Government envisage guidance being issued by the mayor as to the manner in which TfL exercises its functions. I should have thought that it would be issued at the beginning of the whole operation, and then, once guidance had been issued, TfL would be left to get on with the job, subject to observance of the guidelines that have been laid down. The mayor will not issue a fresh set of guidelines in the following week telling TfL how to conduct its operations in that second week. So to say, as the Minister did, that this involves the assembly in the day-to-day operations of TfL is, frankly, a distortion of what my noble friend is trying to do.

Baroness Hamwee

My noble friend pre-empted me. I had also intended to point to Clause 134(1)(a): guidance as to the manner in which it is to exercise its functions", and to sub-paragraph (b): general directions as to the manner in which it is to exercise its functions". My noble friend has made a valuable point about the need not to see scrutiny as simply happening after the event. The Government have made great play of that in their promotion of new models for local government.

The Minister said also that there would be a confusion of roles. But the mayor's role may also be confused: the mayor will be a part of Transport for London and will be issuing guidance to himself.

Baroness Farrington of Ribbleton

I shall consider carefully the point made by the noble Lord, Lord Avebury. It is apparent to me that there are two issues: one is the overall strategy plan and policy; the other is the relationship between the mayor and the executive body carrying those out. The amendment as it stands would put the assembly between the mayor and that second part. However, I will consider the points raised.

Baroness Thomas of Walliswood

I thank the noble Baroness for her various replies. I do not accept that the assembly will be between the mayor and Transport for London. On the contrary, the role of the assembly as we envisage it in this amendment would be to assist the mayor in the drafting and creation of the pattern of guidance. However, I shall read the Minister's remarks. At present, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

6.45 p.m.

Baroness Hamwee moved Amendment No. 254AA: Page 72, line 24, leave out ("perform") and insert ("exercise")

The noble Baroness said: This is a short probing amendment. The amendment proposes that in Clause 134(3)(a) the term "perform" should be replaced with the term "exercise". In Clause 134(1)(a), (b) and (c), the term used is "exercise". I am unclear as to whether there is a distinction between subsection (1) and subsection (3) of the clause. I beg to move.

Lord Whitty

I was somewhat puzzled by the intent of this amendment. If it is merely to obtain some lexicographical clarification, I think that I can give it. Normally, one "performs" duties and "exercises" powers. That is the distinction in these clauses. It is the normal terminology.

Baroness Hamwee

I thought we might deal with this matter before the clock indicated one minute! I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Baroness Hamwee moved Amendment No. 254AB: Page 72, line 28, at end insert ("and if none is nominated then to the chairman, or if the Mayor is chairman then to the deputy chairman.")

The noble Baroness said: Clause 134(4) provides for notification of guidance and issues to an officer who is nominated by Transport for London. I do not believe that it could, or should, be possible for Transport for London to avoid taking notice of guidance and directions by failing to nominate a person to receive them. My amendment, proposing a nominee if none is nominated by the chairman, is designed to add to this "hugely prescriptive" Bill—I have not used that description yet today—a further piece of prescription. I beg to move.

Lord Whitty

This additional piece of prescription is unnecessary. As a statutory body corporate, TfL will be under a duty to act reasonably under the law. It could hardly be construed as reasonable for TfL to avoid nominating a person so as to evade formal receipt of a notification. The point is covered.

Baroness Hamwee

I could argue the finer points for some time, but I shall not. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Dixon-Smith moved Amendment No. 254AC: Page 72, line 28, at end insert— ("(5) In exercising his powers of direction over Transport for London, the Mayor shall be under a duty to ensure that Transport for London operates in a manner which represents value for money and therefore that Transport for London is not subjected to changes of policy from year to year of such a degree as to disrupt its long-term investment and expenditure planning, save in any case where continuity in policy would be manifestly unreasonable on grounds of economy.")

The noble Lord said: Clause 134 deals with control by the mayor of Transport for London. This amendment seeks to place on the face of the Bill the need to recognise that the management, direction and control of Transport for London is too significant and important a matter to become a political football. That may seem a strange concept to put on the face of a Bill. However, I move this amendment with some deliberation.

There was a time, back in history and before a large part of what was formerly Essex was taken into London, when political control changed at every election, which was interesting. That began after the Second World War. Following one election a good council took many actions which were promptly reversed as a result of the next election. Of course, in those days, county councils had greater executive control over their affairs than is the custom today. At the next election there was another reversal of power. That situation having persisted for a while, there was a realisation of the futility of what was happening.

There is a danger, in the structure we are creating, that the business of managing London's transport could become a political football. The mayor has almost absolute control and the Minister has said that that is deliberate. The mayor will have the absolute power to determine the membership of Transport for London; he will be able to determine the terms under which Transport for London's members serve. Presumably he will also be able to determine when to terminate their membership. In theory a new mayor could terminate all those serving on Transport for London and install a new board to do his behest.

London's transport is too important for that. I may not have succeeded in what I attempted in this amendment, but that is the reason that I tabled the amendment. We need to recognise the significance of that as an issue. I look forward to hearing what the Minister has to say in response. I beg to move.

Lord Whitty

This amendment is two-pronged. The amendment would require the mayor to exercise his powers to ensure that TfL operates in such a way as to ensure value for money on the one hand, and not subject to policy changes on the other.

On the first point, it is clear that TfL will be covered by the best value provisions of the Local Government Bill which we shall be discussing in the House shortly. That Bill will require TfL to make arrangements to ensure value for money in the broadest sense.

It would be difficult for us to accept the other point raised by the noble Lord. We are all against political footballs unless we happen to be kicking them ourselves. The whole point of a mayor is that he or she will give some direction and strategy, but at times of elections that strategy may change. A number of putative mayors have been mentioned in Committee and it is conceivable that some of the most frequently mentioned could alternate in the same way as the noble Lord suggests that Essex alternated, no doubt for entirely different reasons. We hope that that does not happen. Nevertheless, if a mayor is elected with a different strategy, ihat will alter the investment priorities which he or she would expect of TfL.

The constraint is that the mayor is required to act reasonably. Therefore, even in regard to a newly endorsed and different manifesto, he or she must act reasonably in dealings with TfL. Transport is, of course, such a central issue—and will be a central issue for many years to come, I suspect, in any election for mayor—that it will not be possible for us to write into the Bill a requirement that the mayor cannot change the direction given to TfL with regard to investment priorities. Perhaps the noble Lord, on reflection, will accept that that, in the relatively crude way expressed in the amendment, is not possible.

Baroness Carnegy of Lour

I had the experience of presiding over a committee of both Houses at Westminster on a Bill connected with roads. The matter was a political football. There had been some 30 days of consideration in Scotland and 17 days of consideration at Westminster, with counsel on both sides. It was a very expensive operation. However, there was an election, the policy changed, and £10 million of ratepayers' money went down the drain because it was a political football.

We all know that democracy can have that effect. Those who have been involved in such matters know the problems. However, I wonder whether the Government could do something to try to avoid what is at the core of my noble friend's argument. As he rightly said, London's transport is too important for there to be constant changes in policy because it suits politicians to swing matters around. Such matters can be expensive.

Perhaps the Minister will consider whether the Government could table an amendment suggesting that policy change should happen only where there is economic justification. At least that would put a brake on the kind of thinking that we all know takes place at election times. Change for the sake of change is dreadful. It actually happened in the case that I have mentioned and it was very damaging. The traffic jams are still there and the money went down the drain, all because of not particularly high-minded local government politics at the time. It happened a long time ago, but it made me realise that waste on a large scale can happen. I wonder whether there is some way in which this matter can be dealt with.

Lord Avebury

There should be some constraints to prevent the sudden disruption of long-term investment and expenditure planning over and above what is represented by the first part of the amendment. The noble Lord, Lord Whitty, said that the mayor will be under the obligation contained in the Local Government Bill to ensure that what he carries out represents value for money. Therefore, if a large investment project were cancelled half way through, as the noble Baroness has suggested may happen in local government, that would be very expensive for the people of London and a contravention of the Local Government Bill, as mentioned by the Minister.

If there is no provision in the Bill, such changes are likely to take place in London. There could be a clean sweep of all the members of TfL. There would be nothing to stop the mayor getting rid of all of them, appointing new members, issuing a new set of general directions and embarking on a totally new investment strategy as long as he can satisfy himself that he is acting within the constraints that the Minister has mentioned.

This point raises great anxieties, particularly when considering the vast needs for investment in the transport system in Greater London, such as the expenditure of huge amounts of money on the Underground system and many other aspects of transport. We need to take such matters into consideration, but I am not sure whether the noble Lord, Lord Brabazon, in framing the amendment, is correct. We need to consider how this problem can be tackled elsewhere in the Bill. I am not sure that this amendment provides the answer.

Baroness Hamwee

I may be a little old-fashioned in this regard, but it seems to me that the conventional constraints of politics, married with the penalties that would be incurred—the compensation that may have to be paid if a major contract were cancelled—are two points that we should leave to be worked through as they are in other areas of government.

I take the Minister's point about political footballs being footballs only when someone else is kicking them. We are all apt to think, "I am right; you are misguided; he or she is completely bonkers." None of that is addressed to any Member of the Committee. But that is politics. If the mayor takes the view that some project to which Transport for London was committed under a previous political regime was the wrong one, I think that, having considered aspects such as compensation which would be payable, the mayor should be able to take a view as to what would be right in all the circumstances. I am sorry to differ from my noble friend on this matter. It may be the result of different experiences. I share the concerns as to what might happen, arising no doubt in part from history. Nevertheless, I believe that democracy needs to have its day.

7 p.m.

Lord Dixon-Smith

I am grateful to those who have taken part in the debate. I am grateful particularly for expressions of support for the idea that we should be concerned about this area. I am absolutely satisfied that, if I were to be one putative mayor and the noble Lord the Minister were to be another, there would be no difficulty. Between reasonable people there is never a problem. That is the way of the world. But we should not attempt to anticipate or second-guess politics. Politics can be extremely strange and we need to think about what can happen if the nature of politics changes. I do not apologise for tabling the amendment. The matter was resolved in Essex by an unwritten convention that everyone who achieved executive office would recognise the actions of their predecessors and go on from there. That is essentially the tradition of government. But it is not on the face of the Bill. I shall study with care what the Minister and other Members of the Committee said. In the meantime, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 134 agreed to.

Clause 135 [Structure of fares and services]:

Baroness Thomas of Walliswood moved Amendment No. 254B: Page 72, line 33, after ("level") insert (", affordability")

The noble Baroness said: Amendment No. 254B and Amendment No. 254BA, with which it is grouped, are straightforward amendments to Clause 135, which provides that the mayor shall exercise his powers in order to ensure that certain specified matters are determined. The first matter he is to direct his attention to is, the general level and structure of the fares". We believe that that should be, the general level, affordability and structure of the fares". The second matter is, the general structure of routes of such services and the general level of provision to be made with respect to their frequency of operation". Amendment No. 254BA adds the words "and capacity" after "operation".

While listening with interest to Members of the Committee talking about politics, it occurred to me that the drafting of paragraph (b) is extraordinarily clumsy. I think we could probably get rid of about half the words contained in it. Meanwhile, I beg to move Amendment No. 254B.

Lord Clement-Jones

I support the amendment. We need to look not only at absolute levels but also at relative levels. The question of affordability is important in fare structures. We think in particular of the socially excluded and the worst-off in that context. I believe that the addition of the word "affordability" would be valuable here.

As to the addition of the words "and capacity" in subsection 2(b), to consider the question of frequency without considering capacity is rather like saying how many buses go by without saying what type of bus they are. One is talking about total volume and one can only reach that by considering frequency and capacity, not just frequency.

Lord Whitty

Amendment No. 254B as drafted is ambiguous in relation to what is intended by the word "affordability", which could apply equally to affordability within TfL as to affordability by passengers. Clearly, as part of the overall strategy, affordability, that is the ability of the public to pay—and in particular sections of the public to which the mayor is bound to have regard—will inevitability figure in the mayor's considerations, as will a number of other matters. We have not specified them all on the face of the Bill because the mayor needs to exercise considerable judgment in this area. Clearly, the view that the mayor takes about fare levels will be influenced by affordability, the structure of the market, the relativities between different modes of transport and the need to promote public transport generally, all of which add up to a fares strategy which will have to be made politically and economically acceptable to the travelling public. Affordability is an inevitable aspect of that, but if we simply specified that it would not give a total picture.

With regard to Amendment No. 254BA, capacity and frequency must inevitably go together. Judgments have to be made about whether one has low capacity, highly frequent buses and trains or high capacity, less frequent buses and trains. That depends on the market, the time of day and many other issues. Frequency subsumes the assessment of capacity. It is worth noting that the current duties on London Transport for setting the general level of provision of its services contain no reference to capacity, but capacity, as well as frequency, is obviously taken into account in London Transport's considerations of the size of buses and trains. Technically, we do not need a reference to "capacity". I ask the noble Baroness to consider withdrawing the amendment.

Lord Clement-Jones

I listened carefully to what the Minister said. I understand his comment that in a sense frequency implies that capacity has been considered. However, I wonder where that is stated in the clause. It seems to me that in talking about volume, numbers of carriages or size of bus, as well as about frequency, one is getting a total volume figure. But it does not seem to me that it is anywhere stated that one is obliged to look at that total picture. There is simply a reference to "frequency". Subsection 2(b) refers to, the general level of provision to be made with respect to their frequency". There is no comma; it is not, "general level of provision of service, with respect to frequency.- It is much more limited than that. It seems to me that that subsection could be much improved, not just in terms of the syntax but by the addition of the words suggested.

Lord Berkeley

I wonder if I can help. I am slightly worried about this clause. I think the problem may be that the clause is general and applies "frequency" to buses, trains and probably other things as well. We have all talked about frequency of trains. It would be lovely to have frequent trains, especially when passengers have to stand like sardines in a cattle truck. To make the trains longer adds capacity, but there may be a problem with the network capability if there are not enough signals, lines or points. I wonder whether we could convince my noble friend the Minister to have another look at the clause to see whether we can find wording that is more applicable to buses, trains and undergrounds. That is only a slight worry and I hope that I have been constructive.

Lord Whitty

I remain somewhat unconvinced that a reference to frequency does not imply making a judgment on capacity. As my noble friend Lord Berkeley says, capacity can apply to the track as well as the vehicle. The situation is complicated and I recognise the concerns. Without making any commitment, I shall see whether we can do anything about it.

Baroness Thomas of Walliswood

I can slightly alter what I was going to say. I thank those who have taken part in the debate, particularly the Minister for his last few remarks. When I introduced the amendment I said that subsection (b) was curiously clumsily drafted. It occurred to me—this might be helpful to the Minister if he is considering the matter—that the words could be changed to: the general structure of routes of such services and the service levels provided". "Service level" is often used to encompass the various considerations of frequency, capacity and ability to serve public need. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 254BA not moved.]

Baroness Thomas of Walliswood moved Amendment No. 254C: Page 72, line 39, after roperation;") insert— ("() the provision of interchange facilities between different passenger modes and cycling;")

The noble Baroness said: The amendment would allow the mayor's guidance and direction to Transport for London to determine that provision is made for interchanges between different modes of transport. It is the first in a series of amendments that try in various ways to tackle the question of interchanges.

If we want an integrated transport system, attention needs to be concentrated on where the different modes of transport meet and whether they work effectively. In the amendments we are particularly concerned that the bicyclist should be able to move his or her bicycle on other forms of public transport, particularly trains, over an entire journey.

Amendment No. 258AZA amends Schedule 9 to include bicycles in the list of things that trains can carry. I am not moving Amendment No. 258AA and I shall leave it to the noble Viscount, Lord Craigavon, to introduce Amendment No. 259EB, which is also in this group and deals with interchanges and the opportunity to take bicycles on an entire journey. I hope that Ministers will take our approach seriously, because these amendments, small though they are, raise an important issue: the ability to make a continuous journey by bicycle and public transport. I beg to move.

7.15 p.m.

Viscount Craigavon

I have my name to the first amendment in the group and I support the noble Baroness, Lady Thomas, but with a slightly different emphasis. Amendment No. 254C deals mainly with parking at interchanges. We have a long way to go to sort out that problem and we need to use various means of persuasion on the companies to encourage them to improve the parking that they provide. The current parking provision, particularly at London stations, is pretty shameful, although it has improved in recent years.

I am not sure whether this is the right place in the Bill to insert the amendment. My Amendment No. 259EB, to which I shall come in a minute, invokes the help of the franchise director. His help may be needed on parking. I should like to give an example, because this is a serious issue. We need to encourage companies to take bicycle parking seriously at stations.

In interviews conducted by the bikerail project—a DETR and Countryside Agency research study—25 per cent of those polled who commuted into London said that they would consider switching from their cars to bicycles for their journey to the station if sufficient, convenient and secure cycle parking was provided. That may appear to relate to stations outside London, but people need to be encouraged by the reassurance that there will be secure and safe custody for their bicycles. It is a matter of the culture of cycling.

Amendment No. 259EB is slightly further on in the Bill, in Clause 137. It might appear slightly ambitious, but I am not trying to change existing contracts. Any change would happen only when new franchise agreements were being negotiated or existing franchises were being renegotiated. I have used the word "commuting" because the aim of the amendment is to make life easier for people who want to commute with their cycles. That is not a tradition in this country. Indeed, the current rules for the companies require them to carry bicycles, so far as is reasonably practicable". In practice that excludes people who want to carry their cycle at commuting times.

I am anticipating what may happen. I hope that the Government will give us some guidance on its thoughts for the future. Large government subsidies will be given on the new franchises. It is not unreasonable to ask for some account to be taken of the interests of cyclists. I hope that the Government will respond on that.

Lord Brabazon of Tara

I have one slight concern about the amendment on the interchange facilities, which relates to the carriage of bicycles on the Underground. I have seen a little map at our local station that shows on which services and at which times of day it is allowed to carry a bicycle on the Underground. It is possible only on the sub-surface lines, not the tube lines. Occasionally one sees someone bringing a bicycle on to a tube line. It is extremely inconvenient for the other passengers when the train is crowded. It is also potentially dangerous, particularly on escalators. I hope that the amendment does not push too far.

Lord Berkeley

In general, I agree that cycling should be encouraged. This morning I took my bicycle on the train from Oxford and pedalled here. By chance, I met the noble Lord, Lord Colwyn, who is not in his place this evening—he wrote to me to say that he could not be here tonight—adjacent to the new pedestrian crossing and gates leading into Hyde Park which were opened yesterday by the Minister for Transport in London, Glenda Jackson, in a flurry of publicity. The gates were locked at 10 o'clock this morning. Perhaps my noble friend can assist as to whether, and to what extent, the regulations apply to the royal parks, which appear to have a mind of their own. The cycle lane that I followed until Hyde Park Corner stopped there. That is a very difficult area to cross on a bicycle. To leave gates like that locked does not seem to be a very good way of encouraging cycling in London.

The provision of interchange facilities is terribly important. I suspect that it is much easier to encourage people to do that than to take bicycles on trains, especially in the rush hour. The noble Lord, Lord Brabazon, is absolutely right: to take bicycles on the Underground is very difficult. Train operators will say that it is also difficult to do that on surface lines because one bicycle may take up five or six seats and someone must pay for that lost revenue. I suggest that an alternative is to encourage the parking of bicycles at stations in London in a secure environment and also at other stations where people get on and off the train.

Some of the stations in London have the facility to hire out bicycles for the day. I am informed that when the company concerned (whose name I do not know) tried to launch the idea at Victoria station neither the train operators nor Railtrack would give it any publicity in the timetables or anywhere else. Some encouragement for parking at stations and other interchanges, and perhaps coach stations as well, is very important. I support provision on the lines of the various amendments that have been tabled by noble Lords.

Baroness Farrington of Ribbleton

I am grateful to the noble Baroness and the two noble Lords who have spoken for the opportunity to reiterate our position on cycling. We are in no doubt that cycling is within the term "transport" and that the provision of transport facilities includes the provision of facilitates for cycles. I repeat what my noble friend said at the previous sitting of the Committee on Monday night: If we were to include a reference to cycling as an additional matter, as distinct from all other modes of transport, it would cast doubt on whether the term 'transport facilities' elsewhere in the Bill included cycling".—[Official Report, 28/6/99; col. 146.] I go further. If we add "cycling" specifically to any part of the Bill we risk calling into question the general understanding in transport legislation that "transport" includes cycling.

I am fully supportive of the promotion of cycling by the noble Baroness and others as a healthy and environmentally friendly mode of transport. I understand why they raise this issue. I should like to refer to one other matter which it is important to place on record. On Monday of this week the noble Viscount, Lord Craigavon, said (at col. 145 of Hansard) that the Minister for Transport in London, Glenda Jackson, had undertaken to report back to the Committee in another place to confirm whether "transport facilities" included cycling. I take this opportunity to say that colleagues in another place confirmed that understanding. The Minister for London, Nick Raynsford, did this during the seventh sitting of the Committee in another place on 9th March.

I turn to the amendments before the Committee. We fully support the idea behind the amendments, but I should like to speak to each in some detail. Our view is that they are unnecessary in view of the duties and powers that the Bill already gives to the mayor and TfL. Amendment No. 254C expands Clause 135(2), which relates to the mayor's duties in relation to the general level and structure of public transport fares and the routes and frequency of those services. An amendment that requires the provision of interchange facilities for cycling would not be appropriate here. The Bill gives TfL wide powers to provide incidental amenities and facilities, such as cycle parking. They can apply at any kind of transport interchange and are not limited to such provision at railway and Underground stations.

Amendment No. 258AZA would add the words "including bicycles" to the power of Transport for London to carry luggage and other goods. The formulation "luggage and other goods" is the same as that used in the provisions set out in the operating powers of London Transport. The exact reference is paragraph 1(3) of Schedule 2 to the London Regional Transport Act 1984. There is absolutely no doubt that London Transport can carry bicycles on its services. I hope the noble Baroness agrees that there is no doubt that Transport for London will be able to carry bicycles.

I understand that Amendment No. 258AA is not to be moved. Amendment No. 259EB in the name of the noble Viscount, Lord Craigavon, would impose a requirement for agreements between the Franchising Director and Transport for London to include at the time of negotiating new or extended franchises provisions to allow the carriage of cycles with London commuters. Her Majesty's Government have made clear to the Franchising Director that they are keen to promote the use of bicycles including, so far as possible, the provision of facilities at stations and suitable space on new rolling stock. There is a standard clause in franchise agreements which requires operators to ensure, so far as is reasonably practicable and subject to the availability of appropriate space on its rolling stock, that facilities for the transport of bicycles on trains are made available to any passengers who use passenger services.

My noble friend Lord Berkeley referred to the royal parks. We are discussing how to ensure that royal parks have regard to the mayor's strategy, and we hope to be able to report to my noble friend later. That will include the encouragement of cycling.

In view of all that I have said, I hope that the noble Baroness will feel able to withdraw her amendment. I apologise to Members of the Committee for dealing with this matter at length, but it is important to place on record the details that noble Lords have sought.

Lord Avebury

The Minister has said that the Bill gives TfL powers to provide interchange facilities, albeit in another clause and not the one now being discussed. We are talking here about something different: the power of the mayor to issue guidance to TfL on what it should do. It seems to me that to place on the face of the Bill the right of the mayor to give guidance on the provision of interchange facilities, to which my noble friend has referred, is very desirable. In that way one would tell the mayor that he had a specific right to give guidance on the provision of interchange facilities. If there is already power given to TfL elsewhere to provide such facilities, why should not the mayor have the right to give guidance on how Transport for London should do it?

Baroness Farrington of Ribbleton

My understanding is that the mayor has the duty to provide a strategy for public transport and the responsibility to ensure that that is carried out. The terminology of the Bill includes provision for cycling.

Baroness Thomas of Walliswood

I thank those Members of the Committee who have spoken in this debate and added some interesting thoughts and contributions which have greatly increased the validity of at least part of the first amendment. The Minister has suggested that because bicycles are subsumed in "transport" there is no need to keep mentioning them. However, the main point of the first amendment is the provision of interchange facilities. Nowhere in the provisions of Clause 135 is there any mention of interchange facilities. Suppose one were to leave out the words "and cycling" and simply insist that the mayor, when he gives his guidance, should emphasise the importance of interchange between different passenger modes. It seems to me that in those circumstances we would still be adding precisely what we want to add and that it might be more acceptable to the noble Baroness the Minister.

I return to the first point that I made. If we are talking about integrated transport systems, the places where those systems interconnect are among the most important areas to which attention should be paid. I shall withdraw my amendment at the present time. The Minister is going to respond. I shall allow her to respond.

7.30 p.m.

Baroness Farrington of Ribbleton

It may save the Committee some time at some stage if I repeat that the mayor has the right to give guidance and directions to TfL on any matter. The Bill gives TfL powers to provide the amenities which the noble Baroness seeks.

Baroness Thomas of Walliswood

I understood that aspect of what the Minister said in her original answer. However, my contention is that in the section to which we are referring we are selecting aspects of passenger services which are particularly important and to which the mayor should direct TfL to turn its attention. It is for that reason that I am suggesting that we may wish to come back at a later stage to the idea of the provision of interchange. In order to avoid argument, we do not need to mention the word "cycling". However, my view is that we may wish to come back to the important issue of interchange facilities. However, for the moment, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 254D not moved.]

Lord Brabazon of Tara moved Amendment No. 255: Page 72, line 41, at end insert— ("(3) In exercising his powers under section 133(1) above to determine the matters specified in subsection (2)(a) above, the Mayor shall ensure that the general level of fares to be charged for public passenger transport services by Transport for London at any time after this Act comes into force is no more than the general level 12 months previous to that time increased by a percentage equal to the control rate. (4) In subsection (3) above the control rate shall be at any time the number of percentage points by which the most recently available figure for the retail prices index has increased on the retail prices index for the month 12 months previous to that figure, less the factor X. (5) In subsection 4 above—

1. (a) "the retail prices index" is the general index of retail prices (for all items) published by the Office for National Statistics, and if that index is not published for a month which is relevant for the provisions of this section then this section shall be construed as referring to any substitute index or index figures published by that Office; and
2. (b) "the factor X" shall, prior to 1 April 2(02, be equivalent to two percentage points, and on or after 1 April 2002 shall be equivalent to four percentage points.")

The noble Lord said: There is a misprint in the amendment. The first line should refer to section 134(1) rather than "section 133(1)". I think that that is obvious.

This amendment seeks to place an annual ceiling on the general level of fares charged by Transport for London and to ensure that this level falls year on year. Transport for London clearly is a public utility. In future, it could become a privatised utility. Parts of it are run at the moment by the private sector. Other parts of it are going to be subject to public/private partnerships.

It is now established that significant utilities, whether public or private, should be subject to a regulator, one of whose functions is to protect the interests of the consumer by ensuring efficiency through a ceiling on costs. I do not believe that anyone would doubt that the major incentive for the vastly improved provision of utilities which began in the 1980s was the use of this price ceiling, particularly in gas, electricity, telecommunications, airport charges, and even the privatisation of rail, where we have seen the regulator imposing fare increase ceilings.

In this Bill, the mayor stands in relation to Transport for London as their regulator. Why then, when the Government would not dare to remove the consumers' price ceiling on other utilities, should not Transport for London be subject to regulation on a similar basis'? This amendment seeks only to cap the general fare level overall. The Bill as drafted refers to a "general level of fares", and we adopt the principle. It is clearly right that premium services, such as those for tourists, should be able to cross-subsidise other services.

I should point out that the figures of factor X in the last section of this amendment may or may not be the right ones. I have put those in merely as a suggestion. It could be that other figures would be better, but the principle remains the same. I beg to move.

Lord Clement-Jones

In rising to support this amendment in spirit, let me first confess in advance to blatant plagiarism. I and others on these Benches liked some aspects of this amendment so much that we turned it into a specific amendment for the London Underground under Amendment No. 280WA, to which we will be speaking later. This, of course, is much broader than that, dealing right across the board with Transport for London. We on these Benches treat it in the spirit of a probing amendment. I suspect that the noble Lord, Lord Brabazon of Tara, is treating it in very much the same spirit. It is very important that we know what the underlying assumptions are as regards fare levels. There are limits on this which are used by Transport for London.

I shall at a later stage go in some detail regarding our own amendments into Ministerial statements on this subject and the failure to publish the Price Waterhouse work underlying the PPP proposals. I also wish to go into some confusion that seems to be evidenced by Ministers as to precisely what assumptions are being made about fare levels, in terms of whether or not the assumptions are for a 1 per cent above RPI rise or whether it is purely according to the rate of inflation. There seem to have been some rather contradictory statements made on this matter. All this lack of transparency points strongly to a need for robust pricing controls.

These amendments are, of course, based on the RPI minus X formula which is used by the privatised utilities. Whether X should be 2 per cent or 4 per cent at any particular time is, of course, a moot question. I hope, however, that the Government will give careful consideration to this amendment. I believe that it points to a very valuable way forward.

Lord Berkeley

On the face of it, this amendment is a good idea. However, if one looks back 20 years, I wonder whether it would have been a good thing if this amendment had been introduced in the London Transport legislation. It is my perception from 18 years of the last government trying to run the Underground that fares used to go up with monotonous regularity. If that is coupled with an inability to borrow without getting Government approval—and the grants will probably go down because these things happen—one will end up with a worse service, increasing breakdowns and no Circle Line, just as we have today, which is a consequence of 20 years of that policy.

I believe that it would be much better if the mayor and Transport for London were allowed some freedom to do what they like in relation to this matter. I certainly do not believe that they will wish to suddenly charge tourists double the fare that they charge us for sitting on the Circle Line.

Baroness Farrington of Ribbleton

This amendment would greatly restrict the mayor's control over the affairs of Transport for London's public transport services. The amendment would set a limit of RPI minus 2 per cent in the year on year increase in any fare on public transport in London until April 2002, and RPI minus 4 per cent thereafter.

The mayor is to define the GLA strategies, including the integrated transport strategy; and the mayor is to set the framework on important matters such as fares. To curtail the mayor's freedom in this area would be out of keeping with the general principle that the mayor should have the powers that he or she needs to make sensible decisions on how the transport strategy can be delivered.

The amendment would also undermine the relationship between the mayor and Transport for London, in that it would limit the mayor's ability to give directions and guidance to Transport for London. But TfL is the mayor's executive body, whose main role is to deliver the mayor's transport strategy. Clause 135 makes it clear that the general levels of fares, the route structure and the frequencies are to be the mayor's responsibility. A mayor might well want to set efficiency targets for reducing costs relative to inflation, but it would be difficult for the mayor to design an innovative transport strategy if major issues such as this are determined on the face of the Bill. I therefore hope that the noble Lord will feel able to withdraw this amendment.

Lord Clement-Jones

The Minister did not deal with some of the underlying assumptions about fare structures, in particular as regards PPP. I understand her remark about not wishing to restrict the mayor's ability to decide fares, but the essence of the amendment is to have an understanding of the kind of fares projected for the future and the economics of the PPP stretching into the future.

With reference to the point raised by the noble Lord, Lord Berkeley, if one is caught between the hammer of price regulations and an inability to borrow, that is unsatisfactory. But from these Benches we argue strongly that Transport for London should be entitled to borrow.

Baroness Farrington of Ribbleton

I apologise to the noble Lord, Lord Clement-Jones, if he believed that I did not answer his point. I understood that the noble Lord would raise those issues when speaking later to a similar amendment. Therefore I did not make a detailed note. However, if at that stage I am able to reply to some of the points he raised, I shall do so.

Lord Clement-Jones

I thank the Minister, and look forward with great anticipation to Amendment No. 280WA.

Lord Brabazon of Tara

I am grateful for the support of the noble Lord, Lord Clement-Jones, on the matter. I look forward to the later amendment.

I knew that I had made a mistake when I put "two percentage points" and "four percentage points" in paragraph (b) of the amendment. The Minister picked that up immediately and used it as a major plank in her argument for not supporting the amendment.

The noble Lord, Lord Berkeley, and the noble Lord, Lord Clement-Jones, are right. We, too, support the idea that TfL should be allowed to borrow. That would get round one of the objections of the noble Lord, Lord Berkeley.

The other objection is that the Bill simply fails to recognise what has happened in the utility sector in the past 18 years. We have seen enormous advantages to consumers of gas, electricity, and so on. The price of water—in which there has had to be a heavy investment programme—has been allowed to rise at more than the rate of inflation. As regards TfL, where there has to be a huge investment, perhaps that would be a case in point.

However, as the noble Lord, Lord Clement-Jones, said, we need to know roughly what we shall have to pay. We need discipline placed upon the management of TfL so that in the future it behaves like the other utilities—even the privatized rail companies which I understand are restricted to the RPI for their fare increases.

I can see that I shall get no further with the amendment today. I beg leave to withdraw it.

Amendment, by leave, withdrawn.

Clause 135 agrees to.

Lord Whitty moved Amendment No. 255A: Transpose Clause 135 to after Clause 143

The noble Lord said: In moving the amendment, I speak also to Amendment No. 256A, 256C, 256D, 259F, 259G and 265B.

These amendments are editorial in nature. Their effect is to restructure Chapter II of Part IV, the chapter which provides for Transport for London's general functions and create a new chapter dealing specifically with TfL's public transport functions. The amendments therefore provide for the creation of a new chapter into which will go by way of the new clause in Amendment No. 263B those provisions of Chapter II dealing with public passenger transport, and the additional functions which are the subject of some of the other government amendments to be considered later.

The effect of the amendment is to set out TfL's functions in a more logical way. I commend it to the Committee.

On Question, amendment agreed to.

Baroness Farrington of Ribbleton

Perhaps I may suggest that the Committee stage begin again not before 8.30 p.m.

Perhaps I may also inform the House that no Northern Ireland business will be taken tonight.

[The Sitting was suspended from 7.44 to 8.30 p.m.]

Lord Brabazon of Tara moved Amendment No. 256: After Clause 135, insert the following new clause—

INTRODUCTION OF SINGLE TICKET FOR JOURNEYS IN GREATER LONDON

(" .—(1) With effect from the appointed day, Transport for London shall introduce, or procure or facilitate the introduction of, a means by which passengers shall be able to make journeys in Greater London using more than one public passenger transport service having purchased only a single ticket; such ticket shall be a voucher or an electronic card or such other system as appears to Transport for London to be the most reliable, economic and efficient means to effect such journeys.

(2) The Mayor may issue regulations under this subsection as to the day on which subsection (1) above shall come into effect, provided that the appointed day within that subsection shall be no later than the fifth anniversary of this Act coming into force.")

The noble Lord said: This is a very simple amendment. It requires the mayor to issue regulations for the introduction of single ticket journeys in Greater London. I know that we have the Travelcard and various other schemes but there is a demand for the ability to buy one ticket to go across the whole of Greater London. The Bill is a great opportunity to meet that requirement. We have given the mayor five years—a reasonable length of time—to bring it into effect. It would do a great deal to encourage people to use public transport. It would make life a great deal more convenient for many people.

Lord Whitty

We all understand what lies behind the amendment and clearly it would be a desirable move. Such ticketing arrangements already exist in the form of a Travelcard. As those who travel frequently on public transport know, a Travelcard is a very popular and successful product. Many thousands of people use it every day. It is not a statutory scheme. It is underpinned by a voluntary agreement between LRT and the train operating companies. TfL will inherit London Transport's obligations under that agreement and will thus continue to offer the benefits of the Travelcarcl to those visiting, living and working in London. It is inconceivable that any mayor would want to risk losing the benefits of such a popular and effective means of promoting public transport. It is more likely the mayor would want to build on it and develop the advantages. There is no need to require the mayor to do that because the whole thrust of Part IV of the Bill is that London Transport should be improved and integrated.

Clause 123 plainly states: The Mayor shall develop and implement policies for the promotion and encouragement of safe, integrated, efficient and economic transport". The Travelcard and similar products will be a vital component in helping the mayor to discharge that duty. It is difficult to see how any move to reduce or remove the benefits of the Travelcard could be consistent with the duty. Not only is it clear that the mayor can do this already in the Bill as drafted but moves in that direction would be beneficial in terms of fulfilling his duties on integrated transport. However, the precise form of such a scheme is best left to the mayor.

I hope that with those assurances the noble Lord can withdraw his prescriptive amendment.

Lord Brabazon of Tara

I am grateful to the Minister for his response. I hope the mayor heeds his wise words and, for that matter, my wise words.

Amendment, by leave, withdrawn.

Clause 136 [General powers]:

The Deputy Chairman of Committees (Lord Elton)

If Amendment No. 256A is agreed to, I shall not be able to call Amendment No. 256AA.

Lord Whitty moved Amendment No. 256A: Page 72, line 43, leave out subsection (1)

On Question, amendment agreed to.

[Amendment No. 256AA not moved.]

Lord Whitty moved Amendment No. 256B: Page 73, line 4, at end insert ("or () carrying on such activities together with activities which Transport for London does not have power to carry on.")

On Question, amendment agreed to.

Lord Whitty moved Amendment No. 256BA: Page 73, line 8, leave out ("for the provision by that person") and insert ("with respect to the provision or financing")

The noble Lord said: In moving this amendment, I shall speak also to Amendments Nos. 258A, 265BA and 265C. These provisions have the effect of reproducing existing functions exercised by or in relation to London local authorities and LRT. These amendments were announced by my honourable friend the Minister for Transport on 4th May in another place as part of a package of amendments to the railway provisions of the Bill. The other railway amendments will be dealt with later. These amendments are effectively transposing existing powers.

On Question, amendment agreed to.

The Deputy Chairman of Committees

If Amendment No. 256C is agreed to, I cannot call Amendment No. 256CA.

Lord Whitty moved Amendment No. 256C: Page 73, line 30, leave out subsection (6)

The noble Lord said: I beg to move.

Baroness Hamwee

Since a betting person would not take any bets on this amendment being rejected, I take the opportunity to make the general point which would have been encompassed in the later amendment were we able to move it. Efficiency and economy are referred to and we understand the Government have included the term "effectiveness" in other legislation. Efficiency and effectiveness are different things. We are persuaded of that, among other matters, in the Local Government Bill now going through your Lordships' House. We hope that, as well as being efficient, economical and safe, transport services in London will be effective and achieve what they set out to do, which after all is the meaning of "effectiveness".

Lord Whitty

If the amendment which I have formally moved is carried, the noble Baroness cannot move her amendment. However, I am conscious of the point she raised earlier in the debate and I shall consider it in relation to the legislation.

Baroness Hamwee

I am grateful.

On Question, amendment agreed to.

[Amendment No. 256CA not moved.]

Lord Whitty moved Amendments Nos. 256D and 256E: Page 74, line 11, leave out ("subsection (6) above or section") and insert ("section (Provision of public passenger transport)(1) or") Page 74, line 29, leave out ("exercise and performance of its functions under this Act") and insert ("discharge by Transport for London of any of its functions")

On Question, amendments agreed to.

Lord Brabazon of Tara moved Amendment No. 257: Page 74, line 31, at end insert— ("() Transport for London may not acquire any interest in a company whose shares are quoted on a recognised stock exchange (within the meaning of section 841 of the Income and Corporation Taxes Act 1988) or traded on any public market (any such company being in this section a "quoted company"). () Where Transport for London acquires an interest in a company which subsequently becomes a quoted company then it shall be permitted such period of time as is reasonable in all the circumstances (being a period not exceeding 2 years beginning on the day when such company first becomes a quoted company) to dispose of such holding for the best price as may be obtainable, and during such period such company shall not be regarded for the purposes of this Part as a company in which Transport for London holds an interest.")

The noble Lord said: This is a probing amendment to discover what the Government believe Transport for London might do. It will enter into financial arrangements with private companies and so forth, as provided in the Bill. We propose that it should not invest in stock market quoted companies and therefore we provide for a prohibition on the direct investment in listed shares.

We hope that Transport for London will have better things to do than to speculate in the Stock Exchange. At the same time, we realise that under PPP arrangements it could acquire shares in a quoted company; for example, if they were exchanged for assets. In our amendment to Schedule 9, we give it the opportunity to do that; it is required to sell them at a point in the future. That amendment also replaces the Secretary of State with the mayor because we believe that it is an issue of subsidiarity, an argument which we have used before in the Bill. We believe that the mayor should be able to make the decision.

These are probing amendments to try to discover what kind of interests the Government believe Transport for London might find with the private sector and how they might work. I beg to move.

Baroness Farrington of Ribbleton

These amendments would curtail the commercial land operational flexibility of Transport for London by preventing it from acquiring any interest in a publicly quoted company.

On a general point, I should make it clear here that we want the mayor and TfL to have sufficient flexibility to discharge their transport duties in a way which best delivers the improvements to transport in London, which we all want to see. Accordingly, Transport for London should not be prevented from acquiring interests in publicly quoted companies, if that helps to implement the mayor's transport strategy. To do so would place a restriction on TfL to which London Regional Transport is not currently subject, under legislation introduced by a Conservative government.

However, I should stress that the Bill is not designed to facilitate the taking back into public ownership of, for example, privately operated bus companies. What the Bill is about is giving the mayor and Transport for London similar flexibility to that of London Transport.

Although I cannot accept these amendments, I am pleased to say that I am able to agree with one small part of Amendment No. 259. As you will see from Amendment No. 258Z, we also intend to remove the need for the Secretary of State to give consent to the acquisition of shares by TfL. However, we do not believe that it is necessary to replace it with mayoral consent. The mayor has wide powers of direction over TfL and can direct TfL to seek mayoral consent if he or she so chooses.

I therefore request the noble Lord to withdraw his amendment.

Lord Brabazon of Tara

I am grateful to the Minister for her fir al comment about removing the Secretary of State. It is good news and I count it as a little victory. As regards the main point, I need to examine the Minister's reply in more detail. However, it seems that it would be possible for Transport for London to renationalise Railtrack, for example. It would not have the money to do so, but, theoretically, it would be able to make an offer for Railtrack. I do not believe that that would be desirable, not least as a resident of London and a ratepayer.

I must consider what the Minister said and I reserve the right to return to the issue at a later stage. In the meantime, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 258 not moved.]

Clause 136, as amended, agreed to.

8.45 p.m.

Lord Whitty moved Amendment No. 258A: After Clause 136, insert the following new clause—

POWER OF MAYOR TO TRANSFER FUNCTIONS

(" .—(1) For the purpose of enabling any person to carry on any activities for which provision is made by an agreement under section 136(3) or (4) above, the Mayor may by order provide for any functions of Transport for London under any statutory provision to be exercisable by that person (whether to the exclusion of or concurrently with Transport for London).

(2) An order under this section may—

1. (a) provide for the functions to cease to be so exercisable when the activities cease to be carried on by that person (whether by reason of the expiry or termination of the agreement or otherwise); and
2. (b) make such supplementary, incidental and consequential provision as the Mayor considers expedient.

(3) The power of the Mayor to make an order under this section includes a power exercisable by order to revoke, amend or re-enact any such order.

(4) An order made by the Mayor under this section shall not have effect unless and until it is confirmed by an order made by the Secretary of State.

(5) This section does not apply to any function of Transport for London under this Act or any other statutory provision specifically amended by any provision of this Act.

(6) Any reference in this section to Transport for London includes a reference to a subsidiary of Transport for London.")

On Question, amendment agreed to.

Schedule 9 [Operating powers of Transport for London]:

[Amendments Nos. 258AZA and 258AA not moved.]

Lord Whitty moved Amendments Nos. 258B to 258N: Page 211, line 6, leave out ("and") and insert— ("3A.") Page 211, line 7, leave out from ("the") to ("may") in line 8 and insert ("purpose of discharging that or any other function of Transport for London are not required for that purpose, Transport for London") Page 211, line 15, leave out from ("using") to end of line 16 and insert—

1. ("(a) any services or facilities provided by Transport for London, by any subsidiary of Transport for London, or by any other person in pursuance of any agreement entered into by Transport for London by virtue of section 136(3) or (4)(a) of this Act; or
2. (b) any other London passenger services or London connecting services.")

Page 211, line 17, leave out sub-paragraph (2) Page 211, leave out lines 23 to 27 and insert ("any services falling within sub-paragraph (1)(a) or (b) above.") Page 212, line 28, at end insert ("or") Page 212, line 34, at end insert— ("() Transport for London may make such charges as it thinks fit in respect of anything done in exercise of its powers under this paragraph.") Page 213, line 9, leave out ("business of Transport for London") and insert ("discharge by Transport for London of any of its functions") Page 213, line 16, leave out ("Transport for London's business") and insert ("the discharge by Transport for London of any of its functions") Page 213, line 18, leave out ("Transport for London's business") and insert ("the discharge by Transport for London of any of its functions") Page 213, line 27, leave out ("Transport for London's business") and insert ("the discharge by Transport for London of any of its functions") Page 213, line 29, leave out ("its business") and insert ("the discharge by Transport for London of any of its functions") Page 213, line 36, leave out ("its business") and insert ("discharging any of its functions")

On Question, amendments agreed to.

Lord Berkeley moved Amendment No. 258NA: Page 213, line 38, at end insert— (" . Transport for London may purchase or lease land for the purpose of securing freight-related intermodal facilities adjacent to rail or waterways where it believes there is a strategic need.")

The noble Lord said: This part of Schedule 9 concerns the acquisition, disposal and development of land. I found it interesting that paragraph 14(2) provides that: Transport for London may … develop for use by other persons land belonging to Transport for London which is not required for the purposes of Transport for London's business; and … where the use of Transport for London's land for the purposes of its business can be combined with its use by other persons, develop the land by constructing or adapting buildings". It may be interesting to see whether an additional clause can be added enabling TfL to purchase or lease land for the purpose of freight-related, inter-modal facilities such as transferring between water, rail and road for purposes such as concreting aggregates, waste disposal or supermarket goods. There is always a problem with such terminals because the rate of return in the freight business is so low that city centre prices are unaffordable.

After drafting the amendment, I wondered whether TfL was able to develop land for passenger transport businesses which it did not operate, such as coach stations. My noble friend the Minister may wish to consider that before the next stage of the Bill because I can see benefits in TfL owning a land bank for such facilities which might be required in 10 or 15 years' time. That land could be used for something else in the interim and when the time came develop it for transport related purposes.

If transport, passenger or freight, especially rail, does not have sites for interchanges, be they stations or freight yards or whatever, it will never fulfil the needs which it could realise. This is an important matter which I hope my noble friend will be able to consider. I beg to move.

Lord Whitty

I thank my noble friend Lord Berkeley for drawing attention to that point. His amendment would enable TfL to purchase or lease land for the purpose of securing freight related intermodal facilities adjacent to rail or waterways or where there is a strategic need.

Schedule 9 already contains a number of powers for TfL in respect of the provision of transport facilities and the acquisition and development of land. However, we need to consider carefully whether those powers extend to the sort of cases envisaged in my noble friend's amendment and in the speech he has just made. With the leave of the Committee and the understanding of my noble friend, perhaps I may be able to consider this issue and return to it at a later stage.

Lord Berkeley

I am grateful to my noble friend for his comments. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

The Deputy Chairman of Committees

Before calling Amendment No. 258Z I must inform the House that if that amendment is agreed to, I cannot call Amendment No. 259 which stands in the name of the noble Lord, Lord Brabazon of Tara.

Lord Whitty moved Amendments Nos. 258P to 258Z: Page 213, line 40, leave out ("its business") and insert ("discharging any of its functions") Page 213, line 42, leave out ("Transport for London's business") and insert ("discharging any of its functions") Page 213, line 46, leave out ("its business") and insert ("discharging any of its functions") Page 213, line 49, leave out ("for the purposes of its business") Page 214, line 8, leave out from ("which") to the end of line 9 and insert ("is required by Transport for London or a subsidiary of Transport for London for the purposes of the discharge of any function.") Page 214, line 11, at end insert— ("() Transport for London shall not by virtue of sub-paragraph (1) above submit to the Secretary of State a compulsory purchase order authorising the acquisition of any land in accordance with section 2(2) of the Acquisition of Land Act 1981 unless the Mayor has given his consent.") Page 214, line 13, leave out from ("treated") to end of line 14 and insert ("for the purposes of sub-paragraph (1) above as the discharge by Transport for London of any of its functions") Page 214, line 17, leave out ("17(2) or (3)") and insert ("17(3) or (4)") Page 215, line 20, leave out ("its business") and insert ("discharging any of its functions") Page 215, line 22, leave out ("its business") and insert ("discharging any of its functions") Page 215, line 22, leave out (", with the consent of the Secretary of State,")

On Question, amendments agreed to.

[Amendment No. 259 not moved.]

Lord Whitty moved Amendments Nos. 259A to 259C: Page 216, line 19, leave out ("proper carrying on of its business; or to secure") and insert ("discharge by it of any of its functions, including the securing of') Page 216, line 20, leave out ("section 136(3) or (4)") and insert ("section 136") Page 216, line 23, after (" 233") insert ("or 324")

On Question, amendments agreed to.

Lord Brabazon of Tara

Paragraph 2(1) of Schedule 9 states: Transport for London may enter into arrangements with any person providing passenger transport services by air for the provision of such services between places in Greater London or between such places and places outside Greater London". Can the Minister enlighten me and the Committee as to what kind of services by air Transport for London might consider arranging within the London area? It seems a fairly remote possibility.

Lord Whitty

Perhaps I may write to the noble Lord in detail. I assume that this covers helicopters and other forms of air travel within London or between London and the London airport; and the possibility of TfL entering into partnerships to gain intermodal transfer with those means of transport. However, if it is significantly wider than that, I shall inform the noble Lord.

Lord Berkeley

I believe it to be a good idea for air to be included in this schedule. As the Committee will be aware, the noble Lord, Lord Brabazon, has tabled an amendment to exclude noise from the air from the environmental study. It is good that air transport is included in the schedule, whether it be helicopters, fixed-wing planes, or whatever.

Schedule 9 agreed to.

Lord Whitty moved Amendment No. 259D: Before Clause 137, insert the following new clause—

FINANCIAL ASSISTANCE BY TRANSPORT FOR LONDON

("—(1) Transport for London may give financial assistance to any body or person in respect of expenditure incurred or to be incurred by that body or person in doing anything which in the opinion of Transport for London is conducive to the provision of safe, integrated, efficient and economic transport facilities or services to, from or within Greater London.

(2) Financial assistance may be given under this section by way of grant. loan or other payment.

(3) The financial assistance that may be given to any London authority under this section includes in particular assistance in respect of any expenditure incurred or to be incurred by the authority in discharging any function of a highway authority or traffic authority.

(4) In deciding whether to give financial assistance to a London authority under this section, and if so the amount or nature of any such assistance, the matters to which Transport for London may have regard include—

1. (a) any financial assistance or financial authorisation previously given to the authority by any body or person, and
2. (b) the use made by the authority of such assistance or authorisation.

(5) In subsection (4) above, "financial authorisation" means authorisation allowing the authority to incur financial obligations.

(6) Financial assistance under this section may be given subject to such conditions as Transport for London considers appropriate, including (in the case of a grant) conditions for repayment in whole or in part in specified circumstances.

(7) In this section—

• "highway authority" has the same meaning as in the Highways Act 1980 (see in particular sections 1 to 9 of that Act);
• "London authority" Weans any London borough council or the Common Council; and
• "traffic authority" has the same meaning as in the Road Traffic Regulation Act 1984 (see sections 121A and 142(1) of that Act).

(8) In section 88(2) of the Local Government Finance Act 1988 (list of "defined councils" to which transport grants are payable by the Secretary of State under section 87 of that Act)—

1. (a) at the end of paragraph (aa) there shall be inserted "and"; and
2. (b) paragraphs (c) and (d) (which include in the list of "defined councils" the London borough councils and the Common Council) shall cease to have effect.

(9) This section is without prejudice to any other power of Transport for London.")

The noble Lord said: These amendments would give Transport for London the power to make grants to other bodies and persons, and the power to provide and to procure guarantees. They extend the power to procure guarantees to London Regional Transport.

Amendment No. 259D allows TfL to pay money from GLA transport grant for transport purposes to other bodies. These include those who would previously have received direct grants from the Secretary of State, such as the borough councils. It will also allow TfL to pay grants to voluntary organisations to provide transport services to meet the needs of disabled people resident in London; for example, as we discussed earlier this evening, Dial-a-Ride. It repeals the power by which the Secretary of State currently makes grants to the boroughs under TPP, because the equivalent funding for boroughs will in future come via Transport for London.

I know that there has been some concern that because GLA transport grant is paid to TfL the boroughs will lose out. There may also be some concern that TfL, a non-elected body, is allocating grants to the boroughs. I do not believe that this should cause such concern. The mayor will have wide-ranging powers of direction over TfL. I would expect the mayor to make arrangements for TfL to submit its proposals for the making of grants to him or her for approval, thus ensuring that the mayor's democratic mandate is given oversight of the process. Amendment No. 259H provides for the amount and recipients of grants to be included in TfL's published annual report, thus ensuring transparency.

At present, if a council fails to spend up to its estimate on the basis of which grant was assessed and paid, the Secretary of State can reduce the grant in ensuing years to make allowance for the overpayment. For example, some boroughs have had large amounts of TPP support for projects whose scope was subsequently reduced. Subsections (4) and (5) enable Transport for London to make similar adjustments.

Amendment No. 259E gives TfL the power to give guarantees to its subsidiaries or to any person with which it has an agreement under Section 136(3) or (4) of the Bill. London Transport has such powers to give guarantees. The amendment extends this power to allow TfL to procure guarantees from a third party, for example from a bank or insurance company, and to indemnify the person who gives the guarantee.

Amendment No. 265AA gives London Regional Transport the same powers as TfL with regard to procuring guarantees. Amendment No. 259H would require TfL to include in its published annual report details of any guarantees or indemnities as well as grants that have been given. I beg to move.

Lord Avebury

Perhaps I may ask the Minister whether the omission of the word "passenger" in sub-paragraph (1) of the new clause in Amendment No. 259D means that Transport for London could give financial assistance to persons or organisations concerned with freight transport. This has a bearing on the amendment we heard about a few moments ago from the noble Lord, Lord Berkeley. He spoke of freight interchange within Greater London. Let us suppose that the Minister comes back with a clause similar to the one tabled by the noble Lord, Lord Berkeley. Would it he broad enough to allow Transport for London, for example, to grant financial assistance to organisations concerned with the interchange of freight throughout the area of the capital?

Lord Whitty

The answer is broadly yes. Under this amendment, grants could be given by TfL for anything which it believes is conducive to the provision of integrated transport. Therefore, it would cover both freight and the intermodal aspects. In effect, this gives TfL the same scope as the mayor's overall strategy.

Lord Dixon-Smith

I also have a question for the Minister concerning Amendment No. 259D. Would this clause give TfL the power to make grants for environmental purposes? The technical development going on within the motor industry means that it is producing ever more fuel-efficient and less environmentally-offensive vehicles. However, the ultimate pollution-free car is only just a few steps down the road. I refer to fuel cell powered cars, which will be non-polluting. When we reach a point where they are hydrogen-powered they become totally and absolutely non-polluting, with no emissions other than water.

I raise this point at this stage for two reasons: first, as of now these vehicles are expensive and experimental. However, there will be 25 running within Los Angeles within about 18 months. Part of the problem of introducing new technologies is to install the necessary fuel infrastructure on the ground. It is no good having a vehicle that produces no pollution if one cannot obtain fuel for it. It occurs to me that that ought to be an area on which either the mayor or Transport for London ought to take a view. Non-pollution is equally valid for all forms of transport, it could be valid for someone running a bus company. After I had read the clause I was not clear whether it would permit the mayor to pay grants, either to help bring forward the new systems or, more importantly, to help to develop the necessary infrastructure that would assist in making them viable.

9 p.m.

Lord Whitty

The noble Lord raises an interesting area. Clearly we are concerned with developing alternative fuels or better use of conventional fuels for environmental purposes. From the national level, this week I announced an increase in the amount of resources we are giving to Powershift to try to assist public and private authorities to change their fleets in that direction.

The position within the Bill is that integrated transport has an environmental dimension. As long as it comes under the integrated transport heading, then Transport for London can provide environmental grants, either of the sort referred to by the noble Lord, Lord Dixon-Smith, or to borough councils as highway or traffic authorities. That can include mitigation work on noise and air quality.

For environmental measures outside the transport field, Transport for London is limited. But, for the bulk of activities to which the noble Lord is referring, the answer is "Yes".

On Question, amendment agreed to.

Lord Whitty moved Amendment No. 259E: Before Clause 137, insert the following new clause—

GUARANTEES

(" .—(1) Transport for London may guarantee to discharge any financial obligation of—

1. (a) a subsidiary of Transport for London; or
2. (b) any person (other than such a subsidiary) with whom Transport for London has entered into an agreement by virtue of section 136(3) or (4) above. where the guarantee is given for the purpose of enabling that person to carry out the agreement.

(2) Transport for London may, for the purposes of discharging any of its functions, guarantee to discharge any financial obligation incurred or to be incurred by any person for the purposes of—

1. (a) an undertaking carried on by him; or
2. (b) where the person is a body corporate, an undertaking carried on by a subsidiary of that body corporate.

(3) A guarantee under this section may be subject to such conditions as Transport for London considers appropriate.

(4) Transport for London may enter into arrangements with another person under which that person gives a guarantee which Transport for London has power to give under this section.

(5) Where Transport for London enters into arrangements by virtue of subsection (4) above, the arrangements may provide for Transport for London to indemnify the person who gives the guarantee.

(6) This section is without prejudice to any other power of Transport for London.")

On Question, amendment agreed to.

Clause 137 [Co-operation with the Franchising Director]:

Baroness Hamwee moved Amendment No. 259EA: Page 74, line 46, leave out ("reasonably")

The noble Baroness said: It may seem unreasonable of us to propose to take out the word "reasonably" in connection with the provision of information between Transport for London and the franchising director. Of course, we support co-operation between the two, and understand, sadly, that sometimes one has to direct people and organisations to co-operate with one another.

However, I wondered about limiting the information as to that which was "reasonably required". My anxiety arose from thinking about how one or other of the bodies would enforce the provisions of this section. One can see that if the recipient of a request for information was reluctant, for a variety of reasons, to provide it, then there would be an easy answer in saying that the request simply was not reasonable. I accept that one then has to go into what is and is not reasonable, but how is it enforced? One would have to go to court.

I wondered what it might be reasonable for one to withhold from the other, apart from commercially confidential information. If that is the only category of information which it would be reasonable to withhold, I would be much happier to see that spelt out. The purpose of this amendment is to probe what the Government have in mind in providing this exception. I beg to move.

Lord Whitty

The use of the word "reasonably" in provisions such as this is simply designed to discourage frivolous or trivial requests for information. I am not sure about this amendment. Given that we are talking about co-operation between two named authorities, its absence may not make any material difference and thereby avoid possible litigation, as the noble Baroness says. However, it would differ from the previous legislation based on Section 2(3) of the London Regional Transport Act 1984 and therefore I would be slightly reluctant to remove it. However, I will undertake to take further advice as to whether or not its removal would materially affect the situation, and, if so, in which direction.

Lord Avebury

Perhaps the Minister could let us know, when he comes back to the Chamber, whether there have been any cases under Section 2(3) of the London Regional Transport Act where an authority has contended that it would be unreasonable to demand the information concerned and has refused to provide it.

Baroness Hamwee

I am grateful to the Minister. He has taken my point that with two public bodies the tests that may apply may be rather different from those applying to individuals. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 259EB not moved.]

Lord Whitty moved Amendment No. 259F: Transpose Clause 137 to after Clause 143

On Question, amendment agreed to.

Clause 137, as amended, agreed to.

Clause 138 [Co-operation with other persons]:

Lord Whitty moved Amendment No. 259G: Transpose Clause 138 to after Clause 143

On Question, amendment agreed to.

Clause 138, as amended, agreed to.

Clause 139 [Annual report]:

Lord Whitty moved Amendment No. 259H: Page 75, line 37, at end insert— ("() any financial assistance given under section (Financial assistance by Transport for London) above; () any guarantees given under section (Guarantees)(1) or (2) above; () any arrangemmts entered into under section (Guarantees)(4) above; and () any indemnities given by virtue of section (Guarantees) (5) above.")

On Question, amendment agreed to.

Lord Brabazon of Tara moved Amendment No. 260: Page 75, line 37, at end insert— ("(c) the externally audited accounts required under subsection (3) below, and (d) the projected budget for the next financial year, including the proposals of Transport for London for ensuring that public debt remains at a stable and prudent level.")

The noble Lord said: In moving the amendment, I shall speak also to Amendments Nos. 261 to 263. All of these amendments concentrate on the same theme: namely, that the accounts of TfL should be externally audited, as accounts of plcs are, and that a number of matters should be looked at during that time. The first amendment provides that the "projected budget" for the next financial year should be looked at, whereas the following amendment provides that the financial statements and statistics relating to the "efficiency and reliability" of the discharge of the functions of TfL be considered—for example, the number of days on which passenger transport services are disrupted by industrial action, the number of cancellations, the number of formerly operated routes which have been closed, the remuneration of senior staff and a number of issues which one would expect of any company whose shares are listed on the Stock Exchange.

We also believe that the report should be available to the public at no charge and published via the Internet, which is the modern procedure. Amendment No. 262 suggests that in public session the assembly should "discuss and vote on" the report submitted by TfL and that, if the report does not receive the support of two-thirds of the members of the assembly, its funds for the following year should not be authorised.

Finally, we suggest that the assembly should have the duty to appoint and fix the remuneration of the external auditors of TfL which, again, is very analogous to corporate governance principles. From what was said when we discussed earlier amendments, we believe that TfL should be treated very much as a commercial company and that it should have to meet the same kind of requirements for external audit, and so on, as apply to any major plc. Indeed, the company will have a large turnover and should be subject to such requirements. I beg to move.

Lord Clement-Jones

Generally, I think that the intention of these amendments is good. However, on the analogy that the noble Lord, Lord Brabazon, talked of in terms of reporting requirements—namely, that TfL should be seen in the light of a commercial company—I find some difficulty with the timing involved. Yes, TfL should produce an annual report at the appropriate time when the accounts have been audited, but I do not agree with the suggestion as regards the budget for the year in which the company will already be when the report is submitted. For example, if the year end is 31st December, the external auditors will probably produce their audit about March or April and TfL will already be in the next financial year. Therefore, putting the budget in that annual report is not particularly useful. Indeed, it would be far more useful to publish it three months or so before the beginning of the next financial year when people can actually debate the content of the budget.

Similarly, it is a little difficult to understand quite how Amendment No. 262 would work in view of the fact that TfL would already be in the financial year. Therefore, it would be rather hypothetical to prevent the company receiving funding for the year in which it would already be working. So, although we recognise that reporting requirements need to be robust and in line with those of a commercial operator, we have some problems with the timing and the precise details of the amendments.

Baroness Farrington of Ribbleton

The amendments deal with the contents of the annual reports of Transport for London, and some of the procedures for dealing with its budget and annual audit. I hope that I shall be able to persuade Members of the Committee that they are unnecessary and, indeed, that they could even be unhelpful.

The Bill already ensures that TfL will be covered by the Accounts and Audit Regulations 1996. Under Regulation 9, TfL will have to publish its accounts, as soon as reasonably possible after conclusion of an audit, or nine months from the day following the end of the period to which the accounts in question relate". TfL is also covered by provisions in Section 15 of the Audit Commission Act 1998, which require it to make its accounts and all supporting documents open to the public.

I turn now to the budget. The mayor is already required to publish the budget for TfL for the year. The Audit Commission Act 1998 and the Accounts and Audit Regulations 1996 lay down requirements which TfL will have to follow on what it must include in its published accounts. There is provision laying down the rights of local government electors for the area of a body subject to audit to inspect the accounts and supporting documents.

As my noble friend Lord Whitty said, TfL will also be covered by the best value provisions of the Local Government Bill which the Chamber has recently been considering. We think that this is the best way of setting targets for TfL rather than through separate primary legislation in this Bill. Following the process in the best value legislation means that users of TfL services, London taxpayers and London's businesses will have a say in improving TfL's performance.

Amendment No. 262 would require the assembly to approve the report by a two-thirds majority. Until the authority did this it would be unlawful for the authority to approve a budget for TfL for the following year which was higher than the year to which the report related. The amendment would cause great uncertainty about TfL's budget. The GLA consolidated budget, of which TfL forms part, must be agreed by the end of February each year. The annual report cannot be published until after the financial year ends on 31st March, and in reality is unlikely to be ready until June or July. So the assembly would have to set TfL's budget in February at a level no more than the previous year and then revisit the budget later on after the financial year in question had started. We do not think that this would enable TfL to manage its financial affairs properly. The noble Lord, Lord Clement-Jones, drew attention to that point.

Clause 118 adds the functional bodies, including Transport for London, to the list of public bodies which under the 1998 Audit Commission Act are required to make up accounts annually. It also adds TfL to the list of bodies which must be audited by an auditor or auditors appointed by the Audit Commission. This means that TfL, like the GLA and the other functional bodies, will be covered by the same audit system as applies to other organisations within the local government finance system. Not only is this tried and tested but it also prevents the assembly becoming bogged down in routine appointment procedures. The assembly's role, should it so choose, is rather to scrutinise and challenge the contents of the audit. I hope therefore that the amendment will be withdrawn.

9.15 p.m.

Lord Avebury

The Minister has covered most of the areas dealt with in the speech of the noble Lord who proposed the amendment. However, she left out one important point. She said that Transport for London will have to publish its accounts which will be open to the public and that local government electors will have the same right to inspect the accounts and supporting documents as they would the accounts of similar bodies. The noble Baroness did not say anything about the proposal of the noble Lord that the reports required under the subsection should be available to the public at no charge and should be published in an electronic form capable of access by members of the public.

There is a major difference between saying that a local government elector is entitled to go into a town hall and look at the accounts and supporting documents—if he can find the relevant documents that he wishes to inspect—and saying that they will be available on the Internet where they are open to the inspection of anyone who wishes to see them, not just the local government electors in the area of Greater London. There may well be people who are not local government electors who would have a locus in the matter and would want to see the accounts. For example, commuters who come into London from outside may well have an interest in some of the matters covered in the accounts or in the supporting documents.

While the noble Baroness may have satisfied the Committee that the accounts will be well and truly audited and that the documents will be available for public inspection, she did not deal with the important point that they should be available on the Internet.

Baroness Farrington of Ribbleton

It is my understanding that that would be a matter for decision by TfL. Should the situation be otherwise, I shall write to the noble Lord.

Lord Brabazon of Tara

I am grateful, I think, for the response of the noble Baroness but I shall need to read what she said with some care. I take on board the point made by the noble Lord, Lord Clement-Jones, about the way I have drafted the amendments. I agree that there may be difficulties with them which the noble Baroness pointed out. However, I do not think that the noble Baroness has satisfactorily answered the question put by the noble Lord, Lord Avebury. It is all very well saying that TfL may publish the documents on the Internet, but we in this Committee are in a position to insist, if we wish, that that is done. The noble Lord made a good point in that regard. I may wish to return to that particular part of the issue at the next stage.

Generally speaking, I am grateful for the noble Baroness's response; I shall read it with care. I hope that when I do so I shall find that most of the points I made will be satisfactorily dealt with under the proposed arrangements. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 261 not moved.]

Lord Whitty moved Amendment No. 261 A: Page 75, line 41, at end insert— ("() Transport for London shall publish any report made under this section. () A copy of any report made under this section shall be kept available for the appropriate period by the Mayor for inspection by any person on request free of charge at the principal offices of the Authority at reasonable hours. () A copy of any report made under this section, or any part of any such report, shall be supplied to any person on request during the appropriate period for such reasonable fee as the Mayor may determine. () In this section "rte appropriate period" in the case of a report under this section is the period of six years beginning with the date of publication of the report pursuant to this section.")

On Question, amendment agreed to.

[Amendment No. 262 not moved.]

Clause 139, as amended, agreed to.

[Amendment No. 263 not moved.]

Clause 140 [Distribution of Property].

Baroness Thomas of Walliswood moved Amendment No. 263ZA: Page 76, line 5, at enc insert— ("() The Secretary of State shall, before making an order bringing into effect the provisions of this Act relating to Transport for London, publish a list of the property, rights and liabilities that will be held by Transport for London or any subsidiary of Transport for London.")

The noble Baroness said: We consider that this amendment standing in my name and those of my noble friends to be of considerable importance in the Bill. It was the subject of a rather irritable debate in Standing Committee A in another place in February of this year. I do not propose to go through all the arguments displayed on that particular occasion. It is the broad thrust of the amendment that is important.

The clauses concern the disposal of property, and the disposal of land in particular. In a series of amendments to be moved by the Minister there is a slight relaxation of the definitions of the kind of land that can be dealt with, how it can be dealt with and whose permission needs to be asked before it can be disposed of. That series of amendments begins with Amendment No. 264A.

I wish to make a straightforward point. Before one starts disposing of what was publicly owned land it would be desirable to have a list of the properties of the organisations which have contributed and have now been taken over by Transport for London. In the debate, the Minister in another place said that asking for the list was asking for the impossible; that it would take forever to make a list of all the widgets, spanners and other property of which TfL was possessed.

I hope that the Minister will take the amendment in the spirit in which it is put forward. We are talking about the major assets of this company. We know quite a lot about these major assets. A Ministerial Answer, which gave a response as to the assets on 31st March 1998, stated that if one takes tunnels, railway carriages, tracks, bridges, drainage pumps, underground stations, escalators and lifts, power stations, sub-stations, bus stations and stands and bus shelters—which are all substantial pieces of property; it is relatively easy to know where they are—one comes to a very large total indeed of objects and lengths of track. Subsequently, in a Written Answer on 20th April, it was stated that the total value of the infrastructure and assets is £6 billion. We are talking about very large sums of money.

I will not go into the whole argument about the privatisation of rail services and Railtrack. However, one really cannot argue with the fact that, as a result of that process, there has been a considerable sell-off—some people have called it asset stripping, but I will be as calm and unaggressive as possible in moving this amendment—of property that was formerly publicly owned and publicly funded. I will not say that one should never allow a company such as TfL to sell any property. However, I believe that we should have transparency about what that property is, when it is sold, why it is being sold and who sanctions the sale. I contend that we cannot do that unless we have a list of the major properties owned by Transport for London. I beg to move.

Lord Berkeley

Operational land and non-operational land is dealt with in the next group of amendments. I have some sympathy with this amendment, but I understand that there must be a minimum property size or value below which it would be unreasonable to ask for a list.

As the noble Baroness, Lady Thomas, has said, there has been a long history of deception—that is almost what I would call it—from the British Railways Board over the years. Many people, including me, have campaigned for the board to publish a list of its land holdings before they were sold. My noble friend the Minister has kindly managed to secure a list of the properties that the board has sold in the past year—which seems to be against the spirit of the White Paper—but we still do not have a list of the land that has not been sold. It does not really matter whether British Rail is continuing to sell land.

The fact remains that, whereas I believe that my noble friend and his colleagues are doing their best to get this right, the history of the past 20 years has created an enormous backlog of suspicion. A list would certainly give people comfort that we are starting from a position of reasonable transparency. I support the principles behind the amendment.

Lord Clement-Jones

As my noble friend Lady Thomas said, this is an important amendment. Under the terms of the Bill—and following assurances given in the White Paper and by Ministers—the assets of London Underground will be kept in public ownership. I note that the amendment will change that to the operating assets of London Underground.

For instance, Clause 141 puts restrictions on the disposal of land owned by Transport for London. We strongly support these obligations and commitments. However, in order to ensure that Transport for London is complying with these obligations, we need to know what assets it owns—whether it is land, fixtures and fittings or rolling stock. Furthermore, when the leasing agreements with the PPP companies are drawn up, it will be important to ensure that all the assets to be leased are identified clearly in the agreements.

In this light, the amendment is surely eminently practical and reasonable. If the Government do not accept it, does that mean that they have not drawn up an asset register for Transport for London for the future? If they have not, is it because they see no prospect of the PPP agreements proceeding in reality?

Lord Whitty

I understand the arguments behind the amendment, but this clause is to do with something entirely different. It is about ensuring that the GLA will be able to transfer the legal ownership of property, rights and liabilities between itself, TfL and TfL subsidiaries in the course of setting up TfL. The amendment would require the Secretary of State to publish a list—which even the supporters of the amendment recognise would be an extremely complicated and difficult list—before making any orders that would bring into effect provisions relating to TfL.

Clauses 319 and 320 allow a Minister of the Crown to transfer property, rights and liabilities from predecessor bodies, such as LRT, to successor bodies, such as TfL. The powers allow Ministers to make those transfers either by order or by administrative transfer scheme. In the case of TfL, it is likely that the vast majority of property rights relating to the relevant functions of the predecessor bodies concerned will transfer to it. The working assumption is that this will be done by exclusion. That means that the orders dealt with under the powers in this clause would list the general classes of rights, property and liabilities which are to transfer between each relevant predecessor body and those individual rights, items of property and liabilities which are not to transfer. Producing a comprehensive list before bringing in the orders would be a hugely time-consuming and expensive undertaking. I certainly do not see that it is justifiable in this context.

I understand the concerns that are being expressed. I do not believe that engaging in this listing process would be justifiable in any case, but it certainly would not be justifiable to require that list to be produced prior to any powers under this clause being operated. Otherwise the whole allocation of assets to TfL, the demarcation between TfL and its subsidiaries and the wrapping up of the property of the predecessor companies could not take place.

9.30 p.m.

Lord Clement-Jones

Can the Minister expand on his comments in terms of the listing of assets? He referred to the transfer of assets being by way of exclusion between successor bodies and so on. But, when it comes to a PPP agreement, surely those assets will have to be detailed in a positive fashion. When London Underground is being split into three parts it will not be good enough to do it by exclusion. That will not be possible. There will have to be detail for each of the different PPP companies.

Baroness Thomas of Walliswood

Perhaps the Minister will excuse me if I add a comment at this stage. When I said that I wanted to go with the spirit of the amendment, I should have added that I acknowledge that it has been put in the wrong place. We were mistakenly advised about that. It would have been more appropriate in the following clause, which deals with the disposal of assets as opposed to the transfer of assets. Does the Minister recognise that there is a real worry about what would happen in the event that, for understandable reasons, the new organisation wished to dispose of its assets? With the backlog of history, that would cause a good deal of suspicion. I have brought forward the amendments to achieve clarity and openness. Will the Minister consider the amendments in the light of the sale, rather than disposal and rearrangement, of the property?

Lord Whitty

By making it conditional on the powers under the clause, it would be a major inhibition on organising all the successor bodies. Therefore, for that reason as well, the amendment is in the wrong place. Even if I were to accept that there was a case for looking at this list, it would be an enormously complex, time-consuming and difficult task. It is not necessary for the PPP process because we will be dealing with PPP on the basis of classes of asset. I suspect that there may well be exclusions there, and the exclusions could be listed. But, in general, the PPP would be looking after the classes of infrastructure which related to particular lines. Therefore, it would not be necessary to list every individual asset where the assets of London Underground pertain to the sub-surface lines or the other groups which will be listed in the PPP. It is accordingly not necessary for PPP purposes.

It might optimally be necessary to make sure that there was no privatisation by stealth in the sense suggested by my noble friend Lord Berkeley and the noble Lord, Lord Clement-Jones. But, even for that purpose, this would be an enormous task. I doubt whether it is worth it. I do not necessarily wish to register any encouragement to the noble Baroness that, were she to introduce this amendment in the right place, we should look favourably on it. It is an enormous administrative task for all the bodies involved.

Lord Avebury

Perhaps the list of assets could be confined to land assets, and not the installations on the land. I can understand that, if an inventory had to be taken of every signal, switch-box and so on, that could be an enormous undertaking. But the disposal of these assets could take place only if the land on which they were placed were also sold. Therefore, simply to list the land holdings would go a long way to meeting the wishes of my noble friend. I should be grateful if the noble Lord, in considering this matter, would take into account the size of the task if it were limited simply to the land holdings of the organisations concerned.

Lord Whitty

On the face of it—although I am not sure that I shall have any support from my colleagues—that sounds a sightly more reasonable request. Nevertheless, even to do that is extremely complex. The land on which, for example, London Underground's assets operate is under various different forms of tenure, not always the freehold of London Underground. So even that is pretty complex; however, I will examine the matter.

Baroness Thomas of Walliswood

The Minister has, as ever, been friendly and gracious in his responses. I am grateful for his answers and I shall read them carefully. However, we may return to this subject at a later date. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Whitty moved Amendment No. 263A: Page 76, line 7, leave out ("disposal of an interest in land where the disposal") and insert ("transfer of an interest in land to the Authority where the transfer")

The noble Lord said: In moving this amendment, I shall speak also to Amendments Nos. 263B to 263J, 264A to 264C, and 265A.

Clause 141 and parts of Clause 140 place restrictions on TfL's ability to dispose of operational railway and tramway land. The clause is designed to prevent the permanent sale of key operational assets, primarily Underground and Docklands Light Railway lines and stations. TfL is required to obtain the Secretary of State's consent to such disposals.

However, as currently drafted, the Bill requires TfL to obtain the Secretaty of State's consent to any disposal of operational ralway or tramway land. We acknowledge that that formulation could be unduly restrictive. If unamended, it could potentially mean that TfL would have to seek consent to all land disposals, instead of just those involving Underground and DLR lines and stations. These amendments therefore give effect to the undertaking given earlier in the passage of the Bill by my honourable friend the Minister for Transport in London that the restrictions on disposal of land would be refined to give TfL some operational flexibility over its property portfolio. At the same time, we have also taken the opportunity to plug one or two gaps in the current clause so that the restrictions cannot be circumvented.

Amendment No. 264C changes the definition of operational land so that the Secretary of State's consent to disposal would not be required where the land in question is comparable to land in general, rather than land used for railway purposes. The wording of the revised definition is similar to that used in the Town and Country Planning Act.

Amendment No. 264A provides that, where Underground or DLR lines or stations cease to be used for railway purposes, disposal would not be permitted without the Secretary of State's consent for a period of five years, or such other period as the Secretary of State may determine.

Amendment No. 264B enables the Secretary of State to issue a consent authorising the disposal of land falling within a specified description.

Amendments Nos. 263B and 263H place restrictions on the disposal of TfL subsidiaries, so that the GLA/TfL cannot form a company, either as a subsidiary or as a joint venture, vest it with operational land and then sell it off—indirectly as a way of circumventing the other restrictions on the sale of land.

The remaining amendments are technical changes. They tidy up the effect of these amendments. I beg to move.

Lord Berkeley

I believe that the Minister has tried hard to rationalise and to clarify the comments made at earlier stages of the Bill. Congratulations are due.

I refer to Amendment No. 264C and the problem of the definition of operational land. In the days of British Rail, it had some operational land at a place called Mistley Quay in Essex, a quay beside the river. That had been closed for years and someone had decided to develop the land. However, as British Rail had not bothered to register the land, someone else had registered it for themselves at the Land Registry. There was a dispute about ownership, but British Rail said that it could not afford the legal fees to sort out the matter. In other words, any person with land adjacent to the railways could register such land and might get away with it if British Rail decided not to fight. That happened several years ago, but there is a suspicion there.

There is no problem with land that is currently operational, but there is a concern over land that was operational 25 years ago, or even 10 years ago. I am thinking of the railway line from Broad Street up to Dalston, which was closed when the Broadgate development began. There is now a proposal by Railtrack to re-open that line. In my view, that is operational land, but it would not have survived Amendment No. 264A because after five years it might have been sold off.

I am also unhappy about paragraphs (a) and (b) in Amendment No. 264C which mention that if the land is by its nature more general that is all right. I wonder whether the Minister could consider the question of land adjacent to operational land which could have been used for other transport purposes, as discussed in connection with a previous amendment.

In the past two weeks we have talked about Railtrack taking over the sub-surface routes and integrating services. I suspect that there will be many parcels of land, where the tracks are together or slightly separate, which could be useful for integrated services. Again, I worry that, under this clause, such land may have been sold off.

Turning to Amendment No. 264A, the amendment mentions "at least five years". I believe that is an inadequate period. I would like to see a period of 25, 50 or even 100 years. Twenty-five years ago we would not have dreamt of today's situation and considering expanding public transport. It is impossible to say what will be needed in 25 years' time. I believe that to sell off old railway lines would be a serious mistake, especially in London, as they may be of use in the future.

Lord Brabazon of Tara

In speaking to this group of amendments I also want to speak to Amendment No. 264 and to my Motion that Clause 141 shall not stand part of the Bill.

The purpose of Amendment No. 264 is to leave out the whole of subsection (3), which would have allowed non-operational land to be sold. Therefore, I am happy to the extent that the Minister in his Amendment No. 264A has gone some way to meeting my suggestion by putting a time limit of five years on the matter. I cannot go as far as the noble Lord, Lord Berkeley. One simply cannot freeze this land for ever. He quoted the figure of 100 years. One must be able to realise the assets. The money could be spent on better transport rather than lying idle.

I welcome the amendments, which go some way to meeting the concerns that lay behind my amendment.

Lord Berkeley

Before the noble Lord sits down, under his definition the Thameslink line would have been sold 15 years ago. It is now running at such capacity that Railtrack is thinking of expanding it, at a cost of several hundred million pounds. Is the noble Lord seriously suggesting that railway rights of way should be sold after five years?

Lord Brabazon of Tara

I am not sure that I gave a definition that would have resulted in Thameslink being sold. I take it that the noble Lord means that it was not operational for more than five years. Five years is the Minister's timescale, not mine. I would have allowed the sale of non-operational land. The noble Lord gives one example. There may be many others in which land has been sold off and put to useful purposes, generating revenue for public transport that would not otherwise been made available.

Lord Whitty

I am not sure whether the noble Lord, Lord Brabazon, said that he would be opposing the Motion that Clause 141 stand part of the Bill. He mentioned the Motion in his opening remarks.

I understand some of the concerns of my noble friend Lord Berkeley, but I also accept what the noble Lord, Lord Brabazon, says. Some flexibility is required to allow TfL some commercial and operational freedom. It would be nonsensical if the sale of any strip of non-operational land that TfL owns required the Secretary of State's permission. In at least some of the examples to which my noble friend referred, the land would have been classified as railway land. I am not sure that all his anxieties are as well placed as he seems to think. The Bill gives TfL freedom over non-railway and non-transport use land, but we are also closing loopholes in other provisions. We have moved to some extent in his direction by providing a way round Transport for London selling public land to the detriment of future transport use. There is a bit of give and take and I hope that we have got the balance right. It would not be sensible to remove the clause, but it is currently a bit unwieldy and places rather onerous requirements on TfL which we would like to relax a little.

Lord Brabazon of Tara

I hope that I said—or at least I meant to say—that I was not going to oppose the Motion that the clause should stand part of the Bill.

On Question, amendment agreed to.

Lord Whitty moved Amendments Nos. 263B to 263E: Page 76, line 9, at end insert— ("() The Mayor shall not, without the consent of the Secretary of State, make a scheme or series of schemes providing for the transfer of property, rights or liabilities to the Authority, the result of which would be that a company would cease to be a subsidiary of Transport for London, if the consent of the Secretary of State would be required—

1. (a) under section 141 below, or
2. (b) under section (Restrictions on contracting out certain services) below,

had the scheme or series of schemes been a transaction or series of transactions entered into by Transport for London.") Page 76, line 10, leave out ("subsection (2) above") and insert ("this section") Page 76, line 12, leave out ("subsection (2) above") and insert ("this section") Transpose Clause 140 to after Clause 142

On Question, amendments agreed to.

Clause 140, as amended, agreed to.

Clause 141 [Restrictions on the disposal of land]:

Lord Whitty moved Amendments Nos. 263F and 263G: Page 76, line 14, leave out ("Transport for London shall not") and insert ("Neither Transport for London nor the Authority shall") Page 76, line 16, after ("in") insert ("any land which is or has been")

On Question, amendments agreed to.

Baroness Miller of Chilthorne Domer moved Amendment No. 263GA: Page 76, line 19, leave out ("Secretary of State") and insert ("Mayor and Assembly")

The noble Baroness said: Amendment No. 263GA would require TfL to obtain the consent of the mayor and assembly rather than the Secretary of State before disposing of operational land or granting a lease of more than 50 years. We have touched on this issue to an extent in the Government's Amendment No. 265, where perhaps they concede that the mayor should not be in a position where he appears to grant something to himself. Amendment No. 263GA includes the assembly and provides the safeguard that we believe is required in this situation. I shall not move Amendments Nos. 263K, 264BA and 264BB. I beg to move.

Lord Whitty

The amendments just agreed to would provide greater flexibility and freedom to TfL, but we believe that the Secretary of State needs to retain some reserve powers in this area. Therefore, any significant disposals of operational or railway land need to be referred to the Secretary of State. We are not in favour of substituting in this context the mayor, who, as the noble Baroness acknowledges, may find himself in a dual position in these circumstances, or the authority as a whole. We believe that in this area the Secretary of State needs to retain powers.

Baroness Hamwee

I hope that the Minister will not think me overly critical or carping. He has said he thinks that what the Government have drafted is correct but has not told the Committee why. It may be that he considers this activity to be so serious that the Secretary of State needs to be involved, but he has not told the Committee why the Government think what they think.

Lord Whitty

When the new authority is established, the Secretary of State will retain certain national powers to ensure that, in view of the commitment that has been given, these assets remain in public hands and cannot be eaten away at the edges. That is a commitment by national government, and therefore the Secretary of State should retain the power. I hope that that is good enough for the noble Baroness. At the moment, I cannot do any better.

Baroness Miller of Chilthorne Donner

I thank the Minister for his reply. I shall read carefully his response to the previous amendment, in which the Government propose to substitute the mayor for the Secretary of State, and try to understand why that is not appropriate in this particular case. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Whitty moved Amendments Nos. 263H and 263J: Page 76, line 19, at end insert— ("() Where an estate or interest in, or right over, any land which is or has been operational land is vested in a company which is a subsidiary of Transport for London, Transport for London shall not, without the consent of the Secretary of State, enter into any transaction or series of transactions the result of which would be that the company would cease to be a subsidiary of Transport for London.") Page 76, line 20, leave out subsection (2)

On Question, amendments agreed to.

[Amendments Nos, 263K and 264 not moved.]

Lord Whitty moved Amendment No. 264A: Page 76, line 25, leave out subsection (3) and insert— ("(3) Consent is not required under this section by reason of any land having been operational land if a period of at least five years has elapsed since the land was last operational land. (3A) The Secretary of State may by order amend subsection (3) above by substituting a different period for that for the time being there specified.")

On Question, amendment agreed to.

Lord Whitty moved Amendment No. 264B: Page 76, line 27, at end insert— ("() Any consent of the Secretary of State under this section—

1. (a) may be given in relation to any particular transaction or description of transactions; and
2. (b) may be given subject to conditions.")

On Question, amendment agreed to.

[Amendment Nos. 264BA and 264BB not moved.]

Lord Whitty moved Amendment No. 264C: Page 76, line 31, at end insert— ("() In this section— operational land" means—

1. (a) land which is used for the purpose of carrying on any railway or tramway undertaking of Transport for London's or of a subsidiary of Transport for London's; and
2. (b) land in which an interest is held for that purpose; but paragraphs (a) and (b) above do not include land which, in respect of its nature and situation, is comparable rather with land in general than with land which is used, or in which interests are held, for the purpose of the carrying on of a railway or tramway undertaking; "railway" and "tramway" shall be construed in accordance with section 67 of the Transport and Works Act 1992.

() For the purposes of this section, Land—

1. (a) which has at any time been used, or
2. (b) in which an interest has at any time been held, for the purpose of carrying on a railway or tramway undertaking of London Regional Transport's, or of a subsidiary of London Regional Transport's, shall be treated as if that undertaking had at that time been an undertaking of Transport for London's or of a subsidiary of Transport for London's (and any question whether the land was, or had ceased to be, operational land at any time shall be determined accordingly).")

On Question, amendment agreed to.

Clause 141, as amended, agreed to.

Lord Brabazon of Tara moved Amendment No. 26.5: After Clause 141, insert the following new clause—

PUBLIC ACCESS OFFICES

(" .—(1) Transport for London shall have the duty to maintain at least one office (referred to in this section as a "public access office") in each London borough where members of the public shall be able to obtain information concerning transport facilities to, from and within Greater London.

(2) The information available at a public access office shall include, but shall not be limited to

1. (a) the frequency of services within the London bus network,
2. (b) the location of stopping places in Greater London,
3. (c) the frequency of railway services within Greater London,
4. (d) the location of railway stations in Greater London, and
5. (e) information allowing passengers to transit from one public passenger transport service to another.

(3) Each public access office shall be open for at least twelve hours each day of the week (including Sundays and bank holidays).

(4) Transport for London shall ensure that members of the public are able to contact any public access office by means of a telephone call at no cost to the public, or by telephone facsimile.

(5) Transport for London shall also ensure that the information available at any public access office is also published electronically in a form capable of access by members of the general public.

(6) Transport for London shall ensure that each public access office is capable of easy access and exit by people with any disability.

(7) In this section "London bus network" and "stopping place" have the meanings given them in Chapter IV of this Part.")

The noble Lord said: We now move on to something a little different. This amendment proposes that Transport for London should have a duty to maintain at least one public access office in each borough from which members of the public will be able to obtain information about transport in London. In our view, it highlights the co-ordinating role that TfL ought to be playing instead of the centralising control mentality that is found in the Bill.

If we are to encourage people to use public transport, it is essential that the maximum amount of information is available to the public to know which services and interchange facilities are available, and so on. It is our contention that all this information should be available in the offices, that the offices should be open at least 12 hours per day on each day of the week, including Sundays and Bank Holidays, and that the information should be published electronically on the Internet in order to make it accessible to members of the general public.

I hope that the Minister can assure me that, even if my amendment is unnecessary because these things will indeed be publicised, at least some of the things that I have outlined in the amendment will in fact take place. If we are to encourage people to use public transport, it is essential that the information should be made available to the public. I beg to move.

Lord Whitty

I remind the Committee and the noble Lords that a number of the matters to which the noble Lord, Lord Brabazon, has referred are already in place or are being developed by London Transport. Clearly, TfL will take over those responsibilities and those assets. As part of the service to Londoners and visitors to London, we want the kind of comprehensive, integrated and accessible information service to which he has referred. London Transport is well on their way to producing that.

However, I am afraid that I cannot accept Amendment No. 265 as it stands. It would place significantly more onerous and specifically prescriptive requirements on TfL than does the present situation with London Transport. In addition, it would not necessarily deliver the most accessible, effective and value for money system of the kind to which the noble Lord referred. It is possible, however, that we can in another way achieve the objective sought by the noble Lord, by in effect placing a general duty on London Transport to provide information to passengers about public transport services of all kinds in London.

With the leave of the Committee and the understanding of the noble Lord, perhaps I can consider that matter further after the next stage of these proceedings.

Lord Brabazon of Tara

I am once again encouraged by the noble Lord the Minister's reply. I must admit that I did not expect him to accept the amendment as it stood. It is possible that the placing of an office in every borough may be a little onerous on Transport for London, and indeed rather costly. However, I am encouraged and I shall look forward to what the Minister has to say at the next stage. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 142 [Control of subsidiaries]:

Lord Whitty moved Amendment No. 265A: Page 76, line 41, leave out ("Secretary of State,") and insert ("Mayor,")

On Question, amendment agreed to.

[Amendment No. 265AZA not moved.]

Clause 142, as amended, agreed to.

Clause 143 agreed to.

10 p.m.

Lord Whitty moved Amendment No. 265AA After Clause 143, insert the following new clause—

POWER OF LONDON REGIONAL TRANSPORT TO GIVE GUARANTEES

(" .—(1) Section 17 of the London Regional Transport Act 1984 (power of London Regional Transport to give financial assistance to subsidiaries and other bodies or persons) shall be amended as follows.

(2) After subsection (3) there shall be inserted—

"(3A) London Regional Transport may enter into arrangements with another person under which that person gives a guarantee which London Regional Transport has power to give under this section.

(3B) Where London Regional Transport enters into arrangements by virtue of subsection (3A) above, the arrangements may provide for London Regional Transport to indemnify the person who gives the guarantee.'"').

On Question, amendment agreed to.

Lord Whitty moved Amendments Nos. 265B and 265BA: After Clause 143, insert the following new clause—

PROVISION OF PUBLIC PASSENGER TRANSPORT

(" .—(1) Transport for London may provide or secure the provision of public passenger transport services to, from or within Greater London.

(2) Without prejudice to section 138 below, any agreement entered into by Transport for London by virtue of section 136(3) or (4)(a) above may in particular provide for—

1. (a) combined services for the through carriage of passengers or goods to be provided by Transport for London or any of its subsidiaries and any other party to the agreement, 525 the quoting of through rates and the pooling of receipts and expenses in respect of such services;
2. (b) securing efficiency, economy and safety of operation in the provision of any public passenger transport services in pursuance of the agreement;
3. (c) the exercise by Transport for London, in accordance with the agreement, of control over fares in respect of any such services and their routes and frequency of operation and over charges in respect of any other facilities provided in pursuance of the agreement; and
4. (d) the making of payments by Transport for London to any other party to the agreement.")

After Clause 143, insert the following new clause—

PROVISION OF EXTRA PASSENGER TRANSPORT SERVICES AND FACILITIES

(" .—(l) The council of a London borough and the Common Council shall each have power to enter into and carry out agreements with—

1. (a) Transport for London,
2. (b) the Franchising Director, or
3. (c) any person who is the holder of a passenger licence, a network licence or a station licence, with respect to the provision or retention, and financing, of public passenger transport services and facilities which would not be available apart from any such agreement.

(2) Transport for London and the Franchising Director shall each have power to enter into and carry out agreements with the council of a London borough or the Common Council with respect to the matters specified in subsection (1) above.

(3) The terms of an agreement entered into under this section shall be such as may be agreed between the parties to the agreement.

(4) Expressions used in this section and in Part I of the Railways Act 1993 have the sun:: meaning in this section as in that Part.")

On Question, amendments agreed to.

Lord Whitty moved Amendment No. 265C: After Clause 143, insert the following new clause—

INFORMATION AND PUBLICITY ABOUT PLANS AS TO SERVICES AND FARES

(" .—(1) Transport for London shall in each year inform the bodies mentioned in subsection (2) below of its current plans with respect to—

1. (a) the general level of transport services and facilities to be provided by Transport for London, any subsidiary of Transport for London or any other person in pursuance of an agreement entered into by virtue of section 136(3) or (4)(a) above;
2. (b) the general structure of routes of such services;
3. (c) the general level and structure of fares to be charged for such services; and
4. (d) the general level of charges to be made for such facilities.

(2) The bodies are—

1. (a) the London borough councils;
2. (b) the Common Council;
3. (c) the council of any county or district any part of whose area appears to Transport for London to be affected significantly by any plans falling within subsection (1) above; and
4. (d) the London Transport Users' Committee.

(3) Transport for London shall cause particulars of the general level and structure of the fares falling within subsection (1)(c) above as they apply for the time being to be published in such manner as it thinks fit.")

On Question, amendment agreed to.

Clause 144 agreed to.

Clause 145 [Provision of London local services]:

Lord Brabazon of Tara moved Amendment No. 266: Page 77, line 41, at end insert— ("(4) This section shall be interpreted subject to section 150 below.")

The noble Lord said: Amendment No. 266 is a paving amendment for Amendment No. 272 which is grouped with it.

According to the Bill a London local service is a service with one or more stopping places in Greater London. According to my interpretation, therefore, as drafted someone running a bus service from, say, Land's End to John o'Groat's making a single stop anywhere within Greater London—for example, somewhere on the M.25 for Heathrow—falls under TfL regulations and TfL can make it illegal. As TfL is under a duty to put London first under Clause 136 arguably it could be obliged to close down such a service.

The amendment attempts to protect bus operators which are only incidentally connected with Greater London by allowing them the opportunity to demonstrate that to be the case. I hope that the Minister can give me a reason why there is no need for the amendment. I beg to move.

Baroness Farrington of Ribbleton

I cannot accept Amendments No. 266 and 272. Clause 150 requires that a London local service (essentially a bus service with stopping places less than 15 miles apart), which is not provided by, or on behalf of, TfL, can only he provided by the holder of a London service permit issued by the mayor.

The amendment risks leaving the door open to wholly unregulated bus operations in London. As such it would lead to additional traffic congestion, would scarcely be helpful to the passengers and would hence make it harder for the mayor to achieve his or her strategic aims. This amendment is entirely at variance with government policy for buses in London.

Our buses "daughter" document to the Integrated Transport White Paper, "From Workhorse to Thoroughbred" set out our intention to deal with matters in the deregulated regime outside London by strengthening powers of the traffic commissioners and by means of quality partnerships and quality contracts to enable local authorities to plan and control bus services in a fully integrated manner.

For London this Bill contains provisions which will broadly give continuity to the planning of a London bus network and provide opportunities for additional services which the mayor may authorise by means of his permit.

This amendment is not necessary, nor is it conducive to the promotion of integrated public transport for London. I therefore urge the noble Lords to withdraw it.

Lord Brabazon of Tara

I am grateful to the Minister for the reply. I am not certain that it took fully on board the point I made in my amendment. I did not seek to propose that deregulated bus services should return to London. I think that they were last there in the 1930s. It appeared to me that if there were a long distance bus service with just one stop in Greater London it would be caught by the provisions of the Bill. However, I shall read with care what the noble Baroness has said. Having done so, I hope that I shall be satisfied. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 145 agreed to.

Clause 146 [The London bus network]:

Baroness Miller of Chilthorne Domer moved Amendment No. 266ZA: Page 78, line 3, after ("providing") insert ("environmentally sustainable,")

The noble Baroness said: I beg to move Amendment No. 266ZA in the names of my noble friends. The amendment seeks to provide that TfL should determine which services are required to provide environmentally sustainable transport services. The Government may feel that this is an unnecessary addition. I turn to what the clause actually provides in terms of what the buses should be like. Nowhere does it state, "They shall not be dirty, smelling and polluting". That is the reputation of buses historically and, although the Government are taking steps, as are bus operators, to clean up the service, sadly economic transport does sometimes mean running stock that is less state-of-the-art in terms of providing clean transport.

I thought some of the comments made by the noble Lord, Lord Dixon-Smith, about the speed of developments in cleaner technology make the inclusion of the phrase "environmentally sustainable", as we have in the amendment here, even more important. The buses that we have now might provide everything in Clause 144(1) but, without "environmentally sustainable", we could have a fleet of buses which were many years behind the times.

Lord Whitty

I understand the intention behind the clause and clearly it is part of our concern—indeed, TfL's duty is to promote progressive improvements in the environmental impact of all of its public transport, including its bus fleet. However, to insert "environmentally sustainable" immediately in front of "bus services" could lead to serious legal challenge. It takes a very long time to replace a bus fleet. To say that any bus running on conventional fuel at the moment did not comply with that requirement in that it was dependent on fossil fuel, or that the degree of emission was outwith the general power on a particular bus or a particular route, would have grave difficulty in meeting the other objectives of accessibility and an adequate bus service. It will take many years to replace the existing fleet and, even if we engage in some improvement of the existing fleet engines, they will not entirely meet the sustainable criteria by themselves.

We explained at earlier stages that transport strategy would have to take account of the mayor's environmental strategy, and part of that no doubt would be to speed up the degree of environmental improvement by public transport and other vehicles. However, to put the adjectives immediately in front of that could lead to some difficulties of interpretation and to legal challenge which would not be helpful. I therefore hope that, in the light of that explanation, the noble Baroness will withdraw her amendment.

Baroness Hamwee

I was grateful when the Minister said earlier this evening that he was considering the point I made on Monday about the inclusion of the term "effective" along with the other two "Es". This clause also deals with efficient and economic service—the words get moved around a little. On this occasion, we have "integrated" as well as "safe" and one would not quarrel with either of those. The Minister has already confirmed today that Transport for London is subject to the best value duty. The Government's argument on the local government Bill when we sought to include a specific reference to environmental sustainability was that the term was actually within "efficient, effective and economic"—I think I have them the wrong way round.

Will the Minister bear in mind the combination of points when considering the possible use of the term "effective", because we should be reassured about the cohesive approach to environmental sustainability?

Lord Avebury

I can see the argument for saying that there could be a challenge to particular services because they were not environmentally sustainable. However, if the term used by my noble friend is interpreted as being the maximum possibly environmentally sustainable, why should not the other terms in subsection (1) be interpreted in the same way? Could there not be a challenge to a service which is claimed by TfL to be safe on the grounds that not everything had been done to avoid every conceivable accident?

Perhaps I may give an example. At bus stops there should be warning signs telling cyclists coming along behind the bus to be careful to indicate as they pass so that cars do not tip them off their bicycles. One can always think of aspects which would add to safety and efficiency or make services more economic. No one is suggesting that there will be a challenge to TfL because in some respect the services offered by it fall short of absolute perfection.

My noble friend is suggesting that at least TfL should aim at providing services which are as environmentally friendly as possible and not that they should achieve the absolute perfection which may be realised when vehicles of the kind described by the noble Lord, Lord Dixon-Smith, are in common use. Cannot the Minister agree that we should write into the subsection the phrase "environmentally friendly" or something similar, in the same way as all the other criteria, without suggesting that perfection be attained in the immediate future?

Lord Whitty

I was making a different point and I am sorry if I did not explain myself clearly. We do not expect maximum environmental, safe or economic working, but of course we are striving on all of those fronts. The point that I made about buses was that while TfL may be required as part of its overall environmental duties to deliver an integrated transport policy which is environmentally sustainable as far as possible, a bus may be environmentally damaging as a bus but in replacing 20 cars may contribute to the broader environmental objectives. If people objected to it as a bus service or its route because of those adjectives, that misses the point of the strategic approach.

Baroness Miller of Chilthorne Domer

I do not wish to detain the Committee, but we shall need to press the point further. Environmental sustainability, when it is difficult to deliver, is frequently the poor relation. That is why we are not good at delivering it. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 146 agreed to

Clause 147 agreed to.

10.15 p.m.

Clause 148 [Addition or variation of a network service]:

Lord Whitty moved Amendment No. 266A: Page 79, line 1leave out ("local") and insert ("London")

The noble Lord said: Amendment No. 266A and the amendments grouped with it are all straightforward and simply amend references to London local authorities in this chapter so that they include the City of London, which had been inadvertently excluded. The amendments put that right. I beg to move.

On Question, amendment agreed to.

Baroness Thomas of Walliswood moved Amendment No. 266B: Page 79, line 1, at end insert— ("() the holder of the London local service agreement to which the proposal relates,")

The noble Baroness said: The first amendment in this group concerns the need to consult when network services are being changed, varied, and so on. The Bill gives a long list of consultees, followed by the words, and any other person whom Transport for London considers it appropriate to consult". Curiously enough, the only person who does not have to be consulted about the decision or the wish to change a service is the holder of a London local service agreement, to which the proposal relates. That seems to us a little strange.

I shall not move Amendment No. 267A. However, I shall be moving Amendment No. 268ZA, which is correctly placed in the clause. The clause lists a number of subjects on which consultation has to take place. Again, curiously enough, the service level required under the service agreement is one of the items not included. We believe it should be. I beg to move.

Lord Whitty

Amendment No. 266B is unnecessary. If TfL wishes to vary a service it would have to vary the agreement under which the service was operating. In other words, it would have to involve the operator directly. In the case of an addition to a network there would not be an operator so designated. It would not therefore be workable.

As regards Amendment No. 268ZA, clearly, we would expect TfL and the mayor to consult rather more widely on aspects of bus service provision. Earlier in the day the noble Baroness mentioned the term, "level of service". That has certain attractions but is also potentially ambiguous. It conceivably requires TfL to go out to consultation every time even a minor change in a route or frequency is contemplated. That would be inefficient and unnecessary. Nevertheless we consider it important that the Bill gives a signal about consultation which on the face of the Bill is a minimum requirement. We would expect TfL to go somewhat wider in practice. However, I am afraid that I cannot accept the amendment as drafted.

Baroness Thomas of Walliswood

I hear what the noble Lord says. However, subsection (3), to which my amendment adds the words, "and the service level", states that it is necessary to consult about,

1. "(a) the route,
2. (b) the terminal points,
3. (c) the points at which passengers may or may not be taken up and set down, and
4. (d) the place at which, or street by the use of which, vehicles used for the service may turn at a terminal point".

There are therefore many matters, for instance, the place at which, or street by the use of which, vehicles used for the service may turn at a terminal point"— which may be thought to be of less importance than the service level; for example, the frequency, the capacity and the timing—more in the morning or more in the afternoon. Those are matters of intense importance to the users of the service. It seems very strange that "the level of service" is not one of the points on which consultation need take place. However, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 267 to 268ZA not moved.]

Lord Whitty moved Amendment No. 268A: Page 79, line 14, leave out ("local") and insert ("London")

On Question, amendment agreed to.

Lord Whitty moved Amendment No. 268B: Page 79, line 15, leave out ("local") and insert ("London")

On Question, amendment agreed to.

Lord Whitty moved Amendment No. 268C: Page 79, line 17, at end insert— ("() Where a place or street mentioned in paragraph (d) of subsection (3) above is situated in the area of a local authority other than a London authority, Transport for London is also required under subsection (2) above to consult that local authority about the matter specified in that paragraph.")

The noble Lord said: Amendment No. 268C requires TfL to consult local authorities outside London if a new network service or a variation of an existing one affects a place or street within their areas. Although the Bill makes provision for TfL to consult widely on bus provision, it is sensible to set a minimum requirement for consulting local authorities outside London on network bus services in the light of local highway authority responsibilities. This amendment ensures that local authorities outside London are consulted about new network services or changes to existing network services. We expect TfL routinely to consult local authorities outside London on a range of bus issues, as London Transport already does. I beg to move.

On Question, amendment agreed to.

Lord Whitty moved Amendment No. 268D: Page 79, line 24, at end insert— ("(6) For the purposes of this Chapter a London authority is any London borough council or the Common Council.")

On Question, amendment agreed to.

Clause 148, as amended, agreed to.

Clause 149 [Discontinuance of a network service]:

Lord Whitty moved Amendment No. 268E: Page 79, line 31, at end insert— ("except where Transport for London proposes that a service replacing the London local service in question and equivalent to it will be provided (whether by Transport for London or any of its subsidiaries, or pursuant to a London local service agreement).")

The noble Lord said: Amendment No. 268E provides that if a network service is being discontinued but is being replaced by another which is equivalent to it, TfL does not have to consult on the change. It seems a sensible piece of flexibility. I beg to move.

On Question, amendment agreed to.

Lord Whitty moved Amendment No. 268F: Page 79, line 34, leave out ("local") and insert ("London")

On Question, amendment agreed to.

[Amendment No. 269 not moved.]

Lord Whitty moved Amendment No. 269A: Page 79. line 38, leave out ('local") and insert ("London")

On Question, amendment agreed to.

Lord Whitty moved Amendment No. 269B: Page 79, line 39, leave out ("local") and insert ("the London")

On Question, amendment agreed to.

Lord Brabazon of Tara moved Amendment No. 270: Page 79, line 40, at end insert ("or any local service which is provided or procured in whole, or in part, by a London borough council or a London health authority")

The noble Lord said: The Bill is silent as to what happens with jointly-run services if TfL were unilaterally to pull out of the arrangement it had made. Potentially such services—for example, for schools and hospitals—become illegal. That is a defect. The amendment protects such services from being criminalised and shut down. I beg to move.

Baroness Farrington of Ribbleton

Amendment No. 270 seeks to extend the requirement to consult local authorities on the discontinuance of a network service. As drafted, it would have the effect of requiring TfL to consult any local authority which has within its area local services which are provided or procured, in whole or in part, by a London borough council or a London health authority. This requirement to consult would apply regardless of whether the discontinued route in question was within a local authority's area. So, if a local authority had local bus services run by local authorities or local health authorities within its area, it would be consulted on every proposal to discontinue to network a bus service in London.

Further, it is not clear what is meant by the term "local service". Local and health authorities have powers to provide or secure transport for certain specified groups, such as disabled people, with the exception of services using school buses which can be provided by LEAs. They cannot provide "local bus services" as defined in Clause 144 of the Bill.

Lord Brabazon of Tara

I am most grateful to the noble Baroness for her reply, which I shall obviously have to study in Hansard. However, I suspect that my questions have been answered. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 149, as amended, agreed to.

Clause 150 [London service permits]:

Baroness Hamwee moved Amendment No. 270A: Page 80, line 3, leave out ("prepare and adopt") and insert ("consult the Assembly before preparing and adopting")

The noble Baroness said: In moving this amendment, I shall speak also to Amendments Nos. 27OB, 273FA, 273GA to 273GD and 273HA. The first of this group of amendments, which concerns London service permits, seeks to provide that the mayor shall consult the assembly "before preparing and adopting" the guidance document for considering applications for such permits. This is consistent with our continuing argument that this type of activity is not out of line with the assembly's scrutiny role in the terms that we have been discussing. However, I can probably anticipate the Minister's reply and shall not, therefore, spend any particular time on this amendment. The next amendment would provide that the mayor should consult the assembly before revising the guidance, and the same points apply.

One of the more important amendments in the group is Amendment No. 273FA, which relates to appeals against the refusal to issue a London service permit. If the mayor is a member of TfL, we consider that such appeals should be made elsewhere because of the potential conflict of interest. We suggest that these appeals be made to the assembly The next four amendments are consequential. Amendment No. 273HA provides that the mayor shall not be a member of an appeal panel.

The question of conflict of interest, or perceived conflict of interest, which is as important, is material. Dealing with appeals against the refusal to grant such permits is, I believe one could say, a quasi-judicial activity. For example, local authorities have a licensing role and great care is taken in that respect to deal with the matter with evident and overt propriety. The mayor could be the chair of TfL and although, in this case, he would not be judge and jury, he would be defendant and judge if he were involved in dealing with a dissatisfied applicant. I am aware that an applicant could apply to the courts if he or she felt that the appeal has not been dealt with properly, but that seems to me to be a very cumbersome remedy and an unnecessary one, as the potential for conflict of interest can be dealt with by disqualifying the mayor in the circumstances we propose. I beg to move.

10.30 p.m.

Baroness Farrington of Ribbleton

We cannot accept Amendments Nos. 270A and 270B. However, I share the noble Baroness's assessment that consultation and openness in this matter are important. But these amendments call for another layer which I believe it is not necessary to prescribe on the face of the Bill. The assembly already has a general duty by virtue of Clause 49(1) to keep under review the mayor's exercise of statutory functions.

Furthermore, the Committee will see that Clauses 156 and 157 specify in some detail arrangements for appropriate consultation exercises. Through these arrangements, assembly members will have every opportunity to contribute to the formulation of the mayor's policy in these areas. I therefore urge the noble Baroness to withdraw these amendments.

Nor can we accept Amendments Nos. 273FA, 273GA, 273GB, 273GC. 273GD and 273HA. These amendments would require appeals to be made to the assembly in the event that the mayor was a member of TfL. There is no reason to suppose that the mayor, if he or she were a member of TfL, would treat appeals any differently. The mayor will not have the time, nor we suspect the inclination, to become involved in the day to day decisions of TfL. Bus services operated under London service permits will represent only a small fraction of his overall responsibilities.

The mayor will be able to refer appeals to an independent appeal panel for consideration and recommendation. Assembly members, GLA staff, TfL staff and members—and due to our Amendment No. 273J, TfL subsidiary directors and staff—will all be disqualified from sitting on that panel. Appellants can have confidence that their appeals will be heard in an impartial and unbiased way.

We are also bringing forward Amendments Nos. 273D, 273E, 273F, 273G and 277A to allow permit holders to appeal against TfL's decisions to attach conditions to permits or to revoke or suspend permits. I hope therefore that I have assured the Committee that the Government believe it is important that the legitimate interests of permit holders should be safeguarded and that we have brought amendments to achieve this. However, the noble Baroness's Amendments Nos. 273FA, 273GA, 273GB, 273GC, 273GD—it begins to sound like the football results!—and 273HA are disproportionate to the issue and unnecessary. I hope that the noble Baroness will feel able to withdraw them.

Lord Avebury

The noble Baroness speaks as if the appointment of the independent panel is automatic. However, as I read Clause 152, the mayor has the power to entertain an appeal himself or herself and the reference to the panel would be a discretionary matter. He does not have to refer to the panel. My noble friend is thinking of the circumstances in which the mayor himself or herself deals with the appeal and there is not an independent panel appointed for the purpose.

Baroness Farrington of Ribbleton

It is a discretionary power but we have no reason to believe that it could or would be the subject of such detailed consideration by the mayor as the noble Lord fears.

Lord Avebury

In that case why does not Clause 152 state that the mayor shall, refer the matter to a panel of persons appointed by him for the purposes of hearing such an appeal"?

Baroness Farrington of Ribbleton

Presumably he could do so in other circumstances apart from that. The noble Lord is obviously not satisfied with the answer I have given and I shall take the opportunity to write to him if he remains concerned about this matter.

Baroness Hamwee

I remain concerned, too, I regret to say. I think the amendments are disproportionate only in the numbering that has been allocated to them.

I have spoken before about the need for trust between the different spheres of government. This is an occasion where trust is becoming complacency. That is not directed at the noble Baroness, as I am sure she will understand. The need for complete impartiality is extremely important at every level of government. I know that the Government will agree with that.

Perhaps I can put the point in a different way. Will the Government consider providing for this situation in the guidance on ethical standards? Can we have an assurance not only that the mayor has an opportunity to take the steps which the noble Baroness explained but that there will be something more; that there will be guidance to the mayor about how to behave in such circumstances?

Baroness Farrington of Ribbleton

We will give very careful consideration to that. Of course, extensive provisions are made in Clauses 156 and 157 for consultation on the guidance document. For example, the mayor will be required to publish the document and revisions to it and to put notices in newspapers where appropriate. The assembly therefore will have every opportunity to comment. It seems inconceivable that the assembly will not take that opportunity. I understand the depth of concern being expressed by noble Lords and I undertake to give the matter consideration, without any commitment to the points raised.

Baroness Hamwee

I am grateful. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 270B not moved.]

[Amendments Nos. 271 and 272 not moved.]

Clause 150 agreed to.

Clause 151 [Grant of London service permits].

Lord Whitty moved Amendment No. 272A: Page 80, line 25, leave out ("local") and insert ("London")

On Question, amendment agreed to.

[Amendment No. 273 not moved.]

Lord Whitty moved Amendment No. 273A: Page 80, line 32, leave out ("local") and insert ("London")

On Question, amendment agreed to.

Baroness Thomas of Walliswood moved Amendment No. 273AA: Page 80, line 32, after ("affected") insert (", the London Transport Users' Committee")

The noble Baroness said: The amendment concerns Clause 151, which deals with the grant of London service permits. The clause states that a large number of people are to be consulted before Transport for London grants the service permit. Those people include the local authorities which are affected, the commissioner or commissioners of police who are affected, the London Transport Users Committee and any other person and so on.

However, when Transport for London grants the permit most of the consultees are informed, except for the London Transport Users' Committee. Our amendment simply adds the name of the London Transport Users' Committee to the list of those who have to be informed when the grant is given. I beg to move.

Baroness Farrington of Ribbleton

We do not feel able to accept the amendment. Notice of granting permits is not a mirror image of the consultation process. When permits are granted it is important that local authorities and the police, who may be affected by the traffic implications, are made aware of the situation. We are confident that the appropriate information will be disseminated to other interested parties such as LTUC. However, as with all the points that were raised, we are prepared to give consideration to the noble Baroness's strength of feeling about the issue. With that commitment, we will consider the matter further if she is prepared to withdraw the amendment.

Baroness Thomas of Walliswood

I am grateful for the Minister's response. The Committee will come presently to the clauses that deal with London Transport. It is intended to be an important player on behalf of the users of transport in London—and particularly public transport in London. That is one of the issues that we will discuss. That is why I moved the amendment, but in light of the Minister's comments, I beg leave to withdraw it.

Amendment, by leave, withdrawn.

Lord Whitty moved Amendment No. 273B: Page 80, line 34, leave out ("local") and insert ("London")

On Question, amendment agreed to.

Lord Whitty moved Amendment No. 273C: Page 80, line 35, leave out ("local") and insert ("London")

On Question, amendment agreed to.

Clause 151, as amended, agreed to.

Clause 152 [Appeals]:

Lord Whitty moved Amendment No. 273D: Page 81, line 2, leave out ("refusal") and insert ("decision to do so")

The noble Lord said: I shall speak also to Amendments Nos. 273E to 273F, Amendment No. 273G and Amendment No. 277A. These amendments are intended to allow further appeals by London service permit holders, as trailed by my noble friend. As currently drafted, the Bill allows applicants for London service permits whose applications have been refused to appeal against the decision. The appeal provisions were discussed in another place, and, after reflecting upon those discussions, we have concluded that it is appropriate to provide further safeguards.

The amendments will allow holders of London service permits also to appeal against TfL's decision to attach conditions to a permit or to revoke or suspend a permit. Appeals must be made within 28 days of the notice of that decision. I beg to move.

On Question, amendment agreed to.

Lord Whitty moved Amendments Nos. 273E and 273F: Page 81, line 5, leave out ("against the refusal") Page 81, line 5, at end insert ("against the decision in relation to which the notice was issued")

On Question, amendments agreed to.

[Amendment No. 273FA not moved.]

Lord Whitty moved Amendment No. 273G: Page 81, line 5, at end insert—

• ("(2A) Where Transport for London—
1. (a) attaches any condition to a London service permit, or alters or removes any condition so attached; or
2. (b) revokes or suspends a London service permit, it must issue a notice to the holder of the permit stating the reasons for the decision to do so.
3. (2B) A holder of a London service permit to whom a notice has been issued under subsection (2A) above may appeal to the Mayor against the decision in relation to which the notice was issued.
537
4. (2C) An appeal under this section against a decision of Transport for London must be made before the end of the period of 28 days beginning with the date of issue of the notice relating to the decision.")

On Question, amendment agreed to.

[Amendment Nos. 273GA to 273GD not moved.]

Lord Whitty moved Amendment No. 273H: Page 81, line 11, at end insert— ("(3A) The Mayor may charge a person making an appeal under this section such reasonable fee as the Mayor considers appropriate having regard to any expenses incurred or likely to be incurred by the Mayor in respect of the appeal.")

The noble Lord said: I shall speak also to Amendment No. 274A. These amendments allow the mayor to charge a reasonable fee to anyone making an appeal. Amendment No. 274B allows the appeal panel to recommend that the fee is repaid in full or in part. These appeal provisions were discussed in another place and, after reflecting on those discussions, we have concluded that it is appropriate to provide further safeguards.

The amendments allow the mayor to charge a fee to anyone making an appeal. However, the fee must be reasonable to avoid its being set at a level that would act as a deterrent to potential appellants. Furthermore, the independent appeal panel can recommend that a fee be repaid in full or in part. I beg to move.

On Question, amendment agreed to.

[Amendment No. 273HA not moved.]

10.45 p.m.

Lord Whitty moved Amendment No. 273J: Page 81, line 16, at end insert (", or () a director of a subsidiary of Transport for London or a member of staff of such a subsidiary.")

The noble Lord said: This amendment prevents a director of a TfL subsidiary or a member of staff of a TfL subsidiary from sitting on the independent appeal panel. I beg to move.

On Question, amendment agreed to.

Lord Brabazon of Tara moved Amendment No. 274: Page 81, line 16, at end insert (", or (d) any officer or employee or member of a company having business with the Authority or with Transport for London, or any company in which Transport for London has an interest, which generates revenue in any twelve month period (measured according to generally accepted principles of accounting) in excess of £10,000, or any officer or employee of any company under the control of such a company or which is controlled by a company which also controls such a company")

The noble Lord said: This amendment adds another person to the list of people who should be disqualified. The Minister has just added one more category. I should like to add people who have a financial interest in a company having business with the authority or with Transport for London. They might be working for a company competing with the company that is appealing. Therefore, I do not think that they should be allowed to sit on the appeal panel. I have set a figure of £10,000. That is not necessarily the right figure. I am perfectly open to suggestions as to what the right figure might be. The Bill sets out who cannot sit on the appeal panel. I just wonder who will sit on the appeal panel. I beg to move.

Baroness Farrington of Ribbleton

I am afraid that I cannot accept Amendment No. 274. Clause 152 deals with arrangements for an appeal to the mayor in the event of TfL refusing to grant a permit. The mayor may appoint a panel to consider the appeal and to make recommendations.

Amendment No. 274 seeks to disqualify from being appointed members of such a panel the officers and employees of companies which have some commercial involvement with TfL. We believe that that is unnecessarily restrictive and quite disproportionate to the issue. It would also be extremely difficult to enforce as it would be almost impossible to determine at any given time who is disqualified from sitting as a panel member.

However, we can see the value of adding the subsidiaries of TfL to the list of organisations in Clause 152(4)(c) whose staff and members are excluded from membership of the appeal panel. We are bringing forward an amendment, Amendment No. 273J, to achieve that. I hope that the noble Lord will feel able to withdraw his amendment.

Lord Avebury

I can see that the amendment as drafted is an extremely wide one, but it occurs to me that one could go part of the way towards meeting it by reference to Clause 136(4), which deals with arrangements that may be entered into by Transport for London with a contractor to carry on activities which Transport for London has not the power to do. Those are specific agreements that are made by Transport for London with companies which will be known. It does not extend as far as the noble Lord's amendment, which appears to cover anyone who does business with Transport for London. That set of companies would be easily definable and identifiable. I suggest that the directors of those companies who might well have an interest in the subject matter of the appeal should be disqualified from sitting on the panel.

Lord Brabazon of Tara

I am grateful to the noble Baroness for her reply and to the noble Lord, Lord Avebury, for his suggestion. I still think that there is a point in this amendment. I may not have the drafting right—I probably have not—but there is a point in that there could be conflict of interest. The noble Baroness has not answered my question about who will be on the appeal panel. We know who cannot be on the appeal panel. I want to know who can be on it. The noble Baroness mentioned Amendment No. 273J. We have just passed that amendment so that is in the Bill. That is helpful to my amendment as it goes some of the way towards satisfying me. Perhaps the noble Baroness would like to comment.

Baroness Farrington of Ribbleton

I apologise to the noble Lord for my reference to an amendment as if it were to be debated when it had already been passed. It was good to receive his thanks for "things received" as opposed to "things to come". He did raise the issue of independent experts. Those would be independent people with relevant experience, but not anyone who might be perceived as biased or people with certain posts in the GLA, as already referred to in the Bill. I hope that that answers the point. I note the strength with which the noble Lord, Lord Avebury, made the case in support, at least in part, of the noble Lord's amendment.

Lord Brabazon of Tara

I shall consider what has been said. In the meantime, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Whitty moved Amendments Nos. 274A and 274B: Page 81, line 20, leave out from beginning to ("requests") in line 21 and insert ("making the appeal") Page 81, line 25, at end insert— ("() A recommendation under subsection (7) above may include a recommendation that Transport for London pay to the person who made the appeal a sum equivalent to all or part of any fee paid to the Mayor by virtue of subsection (3A) above.")

On Question, amendments agreed to.

Clause 152, as amended, agreed to.

Lord Whitty moved Amendment No. 274C: Transpose Clause 152 to after Clause 155

The noble Lord said: In moving this amendment, I shall also speak to Amendments Nos. 276B and 277H. The first two amendments are simply editorial changes. They change the position of the two clauses within the chapter. Amendment No. 277H adds a definition of "the guidance document" to Clause 160, the interpretation clause. I beg to move.

On Question, amendment agreed to.

Clause 153 [Conditions]:

Lord Brabazon of Tara moved Amendment No. 275: Page 81, line 30, at end insert ("provided that no condition shall be operated if it contains or requires features which are neither essential nor reasonably incidental to the purpose of providing a safe, economic and efficient bus service for passengers")

The noble Lord said: In moving this amendment, I shall also speak to Amendments Nos. 276 and 277. All these amendments seek to prevent Transport for London imposing unnecessary and possibly biased conditions as to who can, or cannot, provide a service. The amendment states that no condition shall be operated, if it contains or requires features which are neither essential nor reasonably incidental to the purpose of providing a safe, economic and efficient bus service for passengers". I claim that those are the main necessities in the provision of a service. These amendments would prevent operators being driven out for non-transport reasons, whatever they might be. I hope that the Minister will be able to tell the Committee that my amendments are unnecessary and that no such person would be prevented from operating a service. I beg to move.

Baroness Farrington of Ribbleton

Clause 153 carries forward into current legislation certain provisions which are made for attaching conditions to London local service licences. It applies equivalent conditions to London service permits. TfL will be able to attach such conditions only for reasonable purposes.

Conditions may refer to the suitability of the route, the location of stopping places, and may also be used to promote the safety and convenience of the public, including persons with mobility problems.

Amendment No. 277, in conjunction with Amendments Nos. 275 and 276, seeks to limit the imposition of such conditions, with the result that TfL will no longer be able to take account of matters such as traffic and parking conditions in determining whether to grant a permit. That could compromise the implementation of the mayor's transport strategy and thus represents an approach to which we cannot agree.

However, the Government have brought forward Amendment No. 273G, which will give permit holders a right of appeal against the imposition of conditions by TfL and a right of appeal against the revocation or suspension of their permit for the contravention of those conditions. That should provide appropriate safeguards against the imposition of such unreasonable conditions as the noble Lord rightly referred to. I hope that he feels able to withdraw the amendment.

Lord Brabazon of Tara

I am grateful to the noble Baroness. From what she said, my Amendment No. 277 goes a little further than I had intended. The detail of Amendment No. 273G had not caught my attention in the way in which the noble Baroness would have wished. I believe it goes some way towards answering my apprehensions. Therefore, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Baroness Thomas of Walliswood moved Amendment No. 275A: Page 81, line 41, at end insert ("other than a requirement to provide concessionary fares to particular groups of people")

The noble Baroness said: Amendment No. 275A amends subsection (3) of Clause 153. The subsection says: No condition as to fares shall be attached…to a London service permit". Our amendment would permit exceptions to that if the condition was a requirement to provide concessionary fares.

This matter was debated in another place. The Minister argued that the services we are talking about would be commercial services and that operators should decide whether to offer concessionary fares. That was one line of discussion. On the other hand, the boroughs would have powers to make arrangements for concessionary fares in regard to the services.

It seems rather odd to say that the boroughs can make arrangements with the permit holders who run commercial services, which is what happens all the time in the ordinary granting of contracts with bus providers, but that TfL cannot do so. Can the Minister explain this rather odd situation? I beg to move.

Baroness Farrington of Ribbleton

Amendment No. 275A gives the mayor the power to require the operators of permit services to provide concessionary fares. As those ate commercial services, it would be wrong to allow TIL to attach fares conditions of any sort, including concessionary fares. L will be for the operators of those services to decide whether or not to offer travel concessions to particular groups of people.

If, on the other hand, the noble Baroness, Lady Thomas of Walliswood, is thinking that those services should be incorporated in the London concessionary fares scheme, I should explain that the London boroughs, whose scheme it is, will have the power to make arrangements with permit operators to provide travel concessions if they so wish. As they pay for the scheme, it is right that they, and not the mayor, should make that decision.

I hope, and I am sure from my knowledge of her judgement that it will be the case, the noble Baroness feels able to withdraw the amendment.

Baroness Thomas of Walliswood

I am happy with the Minister's explanation and beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 276 not moved.]

Clause 153 agreed to.

Clause 154 [Duration]:

Lord Whitty moved Amendment No. 276A: Page 82, line 22, leave out from beginning to ("is") in line 25 and insert ("an application has been made for the grant of a new London service permit in substitution for it and—

1. (a) Transport for London has neither granted nor refused to grant the London service permit applied for,
2. (b) Transport for London has refused to grant the London service permit applied for but an appeal against the refusal has been made under section 152 above and not disposed of, or
3. (c) Transport for London has granted the London service permit applied for but an appeal against a decision to attach a condition to the permit has been made under section 152 above and not disposed of, subsection (2A) below shall apply.

(2A) Where this subsection applies, the existing London service permit shall continue in force—

1. (a) in a case falling within subsection (2)(a) above, until Transport for London grants or refuses to grant the London service permit applied for, or
2. (b) in a case falling within subsection (2)(b) or (c) above, until the appeal has been disposed of.

(2B) Where subsection (2A)(a) above applies, if Transport for London—

1. (a) refuses to grant the London service permit applied for, or
2. (b) grants the London service permit applied for but at the time of the grant attaches any condition to the permit, the existing London service permit shall continue in force until any appeal which is made under section 152 above against the decision in question has been disposed of.

(3) This section")

The noble Lord said: Amendment No. 276A deals with London service permits and allows services to continue under certain circumstances. Those circumstances are: if a permit holder makes an application to renew a permit for a service which is about to expire, the service can continue until the application has been disposed of; or if a permit holder appeals against a decision by TfL to impose conditions on a permit or to revoke or suspend a permit, the service in question can continue until the appeal is disposed of. The amendment thus safeguards the commercial interests of a permit holder because he or she can continue to operate in the circumstances described until matters are resolved. I beg to move.

On Question, amendment agreed to.

Clause 154, as amended, agreed to.

11 p.m.

Lord Whitty moved Amendment No. 276B: Transpose Clause 154 to after Clause 155

On Question, amendment agreed to.

Clause 155 [Revocation]

[Amendment No. 277 not moved.]

Lord Whitty moved Amendments Nos. 277A and 277B: Page 82, line 33, after ("be") insert ("revoked or") Page 82, line 36, leave out ("local") and insert ("London")

On Question, amendments agreed to.

Clause 155, as amended, agreed to.

Clause 156 [Consultation]:

Lord Whitty moved Amendment 277C: Page 83, line 3, leave out paragraph (a) and insert— ("(a) each London authority,")

On Question, amendment agreed to.

Clause 156, as amended, agreed to.

Clause 157 [Publication]:

Lord Whitty moved Amendment No. 277D: Page 83, line 22, leave out from ("document") to end of line 24

The noble Lord said: The clauses require the mayor to do two things: he or she must make the guidance document and any revisions to it available for inspection free of charge for an appropriate period; and he or she must also supply on request a copy of the guidance document and any revisions to it for a reasonable fee for an appropriate period. That appropriate period is defined as six years from the publication of the document or any revisions of it. The relevant change to the drafting of the original clause is the reference to the appropriate period and its definition. That ensures that anyone who is interested in seeing or obtaining a copy of the guidance document or any revisions to it will be able to do so up to six years from the date of publication. I beg to move.

On Question, amendment agreed to.

Lord Whitty moved Amendment Nos. 277E to 277G: Page 83, line 26, leave out from ("revised") to end of line 27 Page 83, line 27, at end insert— ("() In this Act, references to the guidance document include, except where the context otherwise requires, a reference to the guidance document as revised.") Page 83, line 31, at end insert— ("() A copy of the guidance document shall be kept available for the appropriate period by the Mayor for inspection by any person on request free of charge at the principal offices of the Authority at reasonable hours. () A copy of the guidance document, or any part of it, shall be supplied to any person on request during the appropriate period for such reasonable fee as the Mayor may determine. () In this section "the appropriate period" in the case of the guidance document is the period of six years beginning with the date of publication of that document pursuant to this section.")

On Question, amendments agreed to.

Clause 157, as amended, agreed to.

Clauses 158 and 159 agreed to.

Clause 160 [Interpretation]:

Lord Whitty moved Amendment Nos. 277H and 277J: Page 84, line 22, at end insert— (""the guidance document" shall be construed in accordance with section 150(2) above,") Page 84, line 22, at end insert— ("London authority" shall be construed in accordance with section 148(6) above,")

On Question, amendments agreed to.

Clause 160, as amended, agreed to.

Clause 161 [Power of Authority to give guidance to the Franchising Director]:

Baroness Thomas of Walliswood moved Amendment No. 277JA: Page 85, line 3, after ("may") insert (", after consultation with the London Transport Users' Committee,")

The noble Baroness said: The amendment would require the authority to consult the London Transport Users Committee before it gave guidance to the franchising director. If the Government amendments that are coming up are passed, as I have no doubt that they will be, we shall have directions to the franchising director rather than merely guidance. That makes it even more important that the LTUC should be consulted. If there is no requirement it appears that the onus is always on the LTUC to make its concerns known.

In another place the Minister argued that this amendment was unnecessary as the LTUC had the opportunity to present its concerns to the mayor. But when we begin to consider railways and the relationship between the authority and franchising director we believe that this very important watchdog should be brought in. I beg to move.

Baroness Farrington of Ribbleton

This amendment would require the mayor to consult the LTUC before issuing guidance to the franchising director. The LTUC is the new representative body for transport users that we intend to establish under this Bill. We shall debate it later. We want the LTUC to play an active role in representing the interests of transport users, and that is why it will be able to make recommendations to the assembly, the mayor and Transport for London about the exercise of their respective functions. We do not, therefore, think it necessary to require the mayor to consult the users' committee before issuing guidance to the franchising director. It will be open to the mayor to do so if he or she wishes, but we believe that that should be a matter of good practice rather than a heavy-handed legal requirement.

In addition, to impose a requirement on the mayor to consult the LTUC would prevent the mayor from taking swift action when necessary if he or she wished to issue urgent guidance to the franchising director. I hope, therefore, that the noble Baroness will feel able to withdraw the amendment.

Baroness Thomas of Walliswood

I am a little disappointed by the Minister's reply. The Bill makes the very broad-brush statement that, The Authority may give guidance"— it is to be an instruction— to the Franchising Director in relation to the provision of railway services in Greater London". I would have thought that, when the authority was thinking about what guidance to give, the most important group of people to be consulted would be representatives of the users of that transport system. I understand from the Minister's reply that she is not prepared to concede the strength of my argument. For the time being, I shall withdraw the amendment. However, we may need to return to this matter later, possibly by amending the provisions that create the London Transport Users' Committee or in some other way. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Whitty moved Amendment No. 277K: Page 85, line 3, after ("give") insert ("instructions or")

The noble Lord said: In moving Amendment No. 277K, I should like to speak also to Amendments Nos. 277L to 277T, 278A, 279U to 279X and 279VA to 279ZA. I shall need to deal with this group of amendments in a little more detail. The amendments give effect to a very important part of the Bill and the undertaking given in the other place earlier in the passage of the Bill by my honourable friend the Minister for Transport in London. She then committed the Government to bringing forward measures more fully to define the relationship between the mayor and the franchising director, which we anticipate will eventually be between the mayor and the proposed strategic rail authority.

The Committee will be aware that we are committed to giving the mayor a strong voice in rail, but that the mayor's powers should not detract from the wider strategic responsibilities of the franchising director and the strategic rail authority. We have taken careful note of the numerous points made on this issue and believe that the amendments that we have tabled will help to create the right framework.

Amendment No. 279XA places the franchising director under a duly to consult the mayor over proposed changes to service levels and fares on rail services. It is a very similar power to the franchising director's existing duty under Section 31A of the London Regional Transport Act 1984 which requires him to consult London Regional Transport. However, the new clause expands that duty so that the franchising director must consult the mayor about fares and services to, from and within London, rather than services wholly within London. The widening of the franchising director's duty reflects the fact that the mayor has a general transport duty under Clause 123 in respect of transport facilities and services to, from and within Greater London.

Amendment 277S gives clarification of the position where there is a conflict between the mayor's instructions and guidance to the franchising director and those issued by the Secretary of State. Under these amendments, the franchising director will have to implement the mayor's instructions and guidance unless to do so will "prevent or seriously hinder him" complying with the Secretary of State's guidance. This is intended to more precisely ensure that whilst the mayor should, rightly, be able to influence the operation of London rail services, his instructions and guidance should not undermine or be inconsistent with national policy objectives as set out in the Secretary of State's instructions and guidance. The amendment preserves that principle but gives the mayor more flexibility than was available to him or her under the original wording.

The amendment allows the mayor's instructions and guidance to differ from the Secretary of State's in some respects. In some circumstances, the franchising director would have to implement the mayor's instructions and guidance even if it conflicted with the Secretary of State's, as long as implementation did not "prevent or seriously hinder" the implementation of the Secretary of State's instructions and guidance. For example, the mayor's instructions and guidance might require the franchising director to ensure that certain stations were staffed at all times of the day, whereas the Secretary of State's instructions and guidance might specify less stringent minimum requirements. Although, on the face of it, the two sets of instructions and guidance would conflict, implementing the mayor's instructions would not prevent or seriously hinder compliance with the Secretary of State's objectives.

Amendments Nos. 277K to 277M, 277P to 277R, 277T, 278A, 279UA and 279VA allow the mayor to issue "instructions" as well as "guidance" to the franchising director. This is a technical amendment designed to harmonise the wording in the Bill with that of the Railways Act 1993.

Amendment No. 277N provides that the franchising director is to implement the mayor's instructions and guidance "in the manner best calculated to give effect to the instructions and guidance", rather than simply to implement them. Again, this reflects the similar wording in the Railways Act 1993.

Amendment No. 279YA restricts TfL's ability to enter into direct agreements with franchised train operators. The effect is that any instructions in respect of additional railway services will have to be included in the mayor's instructions and guidance to the franchising director. The franchising director will then procure the services on behalf of the mayor. The franchising director will only be able to refuse the mayor's requests if the constraints in subsection (5) are triggered.

We have taken this approach on additional services in acknowledgement of the fact that London's rail network is uniquely complex and very heavily used. The franchising director is best placed to make decisions about the allocation of scarce track capacity and to advise the mayor on how his or her requirements for additional services can best be met; otherwise there is a risk that additional services procured on an ad hoc basis could result in a sub-optimal use of the network. The franchising director, and eventually the SRA, will be able to take a strategic view on the best way of providing those services so as to ensure best use of the scarce capacity, and advise the mayor accordingly.

However, the clause does allow TfL to enter into indirect agreements with train operators, where these are through the franchising director or through a London local authority. The local authority exception is designed to allow for local agreements covering transport facilities provided jointly by TfL, the local authority, and a train operator.

Amendment No. 279ZA places the Secretary of State under a duty to consult the mayor if the Secretary of State proposes to vary the amount of penalty fares payable on heavy rail services.

I should mention here that, in addition to those tabled, there is one other measure which my honourable friend the Minister for Transport in London announced and which is not included here. It relates to a power for the mayor to bring forward proposals for new investment in the rail infrastructure by promoting local Bills in Parliament and orders under the Transport and Works Act 1992.

We intend to bring forward such proposals. We are working on them now, and we shall bring them forward at a later stage. The amendments I propose give the mayor a strong voice in rail, as promised in the White Paper, and strike the right balance between the mayor's powers and the wider strategic transport interest.

Baroness Hamwee

We welcome the amendments. They go a long way to meet points made by my honourable friends in another place, in particular those dealing with instructions, and so on. We had proposed that "guidance" be changed to "direction". However, we appreciate that the Government have moved. We were also concerned about the matter which is now reflected in Amendment No. 279XA.

Perhaps the Minister can help me. We welcome the strengthening of the provisions. I listened to his explanation which I shall read carefully. Nevertheless, the franchising director still does not have to take any notice in view of the provisions of Clause 161(6) which is not amended by this group of amendments. The subsection states: If the Franchising Director decides not to implement any guidance —it may not be termed that now— whether generally or in a particular case, he shall give the Authority notification of the decision and his reasons for it". Can the Minister confirm that there is still a block on the implementation of the authority's instructions?

Lord Whitty

Clause 161 makes clear that the franchising director has to consider that the mayor's instructions would cause adverse impact on the rest of the rail network. He would have to act reasonably. But it is for the franchising director to decide whether there would be an adverse impact on the remainder of the network.

Baroness Hamwee

That is Clause 161(5). If the Minister says that Clause 161(6) has to be read in the light of Clause 161(5) then it would be useful to have confirmation. I appreciate that it is somewhat late. I also appreciate the importance of the clause, so I would not press the Minister to give an answer if he feels he needs some time to consider it. I should welcome clarification.

Lord Whitty

I may need to clarify the point in writing. However, my reading of the Bill is that Clause 161(6) refers to the franchising director deciding not to implement under the terms of the immediately preceding clause. If there is anything different to communicate, I shall let the noble Baroness know.

Baroness Hamwee

I am grateful. It is an important point. If the Minister revises his view, we should find an opportunity to read that on to the record. This relationship is important.

Lord Whitty

I commend the amendment.

On Question, amendment agreed to.

Baroness Hamwee moved Amendment No. 277KA: Page 85, line 4, after ("provision") insert (", addition and variation")

The noble Baroness said: In moving the amendment, I speak also to Amendments Nos. 277KB, 277TA and 278B. The amendment provides that in connection with the instructions given with regard to the provision of railway services Clause 161 shall apply also to the addition and variation of any railway services and to services that operate and serve stations predominantly within the Greater London area but also those extending for up to 15 miles outside it and to Stansted and Luton airports, given the importance of those two London airports to London and the operation of transport services between them and London. The other two London airports are not referred to specifically because they are within the 15 mile radius.

Amendment No. 277TA takes us back to Clause 161(5) which the Minister and I have just been discussing. The franchising director is not to give effect to instructions if he believes, among other matters, that implementing them will have an adverse effect on the provision of services or railway passengers outside Greater London.

We are proposing that he should only be able to exercise his power under this provision if implementation would have a significant—that is the new term—adverse effect. For example, if the service were to stop at an extra station adding perhaps another two minutes onto a passenger's journey, we do not believe that the franchising director should be able to use his power to intervene. We also believe that the term could usefully be included in Clause 161(5)(c) under which he can refuse to give effect to instructions if he believes they will increase the amount of payments to which this subsection refers. We propose that this should only be the case if they were to increase insignificantly.

We have taken note of the Minister's comments in another place. My recollection is that she noted the use of the term "significant" when my honourable friends raised issues around these points. I hope that the Minister will either be able to accept these words or something like them, or assure us that they are implicit in any event within the wording of the section. I beg to move.

Lord Whitty

In the light of what we have passed already, these amendments are unnecessary or could unbalance the relationship which we are trying to achieve by the former batch of amendments. Amendment No. 277KA indicates that the mayor can issue guidance to the franchising director in respect of the addition and variation of railway services in London as well as the provision. The addition is unnecessary because the term "provision" includes "addition or variation". If the noble Baroness is interested, I can give her precedent for that interpretation in transport legislation.

Amendment No. 277KB extends the area in respect of which the mayor can give guidance to the franchising directors, so that would also cover services up to 15 miles outside and to Stansted and Luton Airports. Clause 161 already provides for the mayor to issue guidance which affects services outside London as long as the guidance does not fall foul of the constraints in subsection (5) of the clause.

One of the constraints requires that the franchising director will not implement the mayor's guidance if that would have an adverse impact on rail services outside London. Amendment No. 277TA would require the adverse impact to be "significant" in order for the franchising director not to implement it.

It may be helpful if I set out how a franchising director will decide whether the mayor's guidance will have adverse impact; and it is important to differentiate here between the mayor's strategy and his or her guidance to the franchising director. Where the mayor's strategy, which of course covers all major transport, is inconsistent with the national policy in a way which is detrimental to any area outside Greater London, then the Secretary of State will have a reserve power. The franchising director is not involved.

Turning to subsection (5), there has been some debate to which the noble Baroness referred as to how the term "adverse impact" should be defined. It was suggested that if the mayor were to use the guidance it would be open to the franchising director to regard an additional stop between Waterloo and Basingstoke as having an adverse impact.

It might or it might not. Clause 161 makes clear that it is for the franchising director to decide what constitutes an adverse impact, but he is under an obligation to take a reasonable approach. If the impact were trivial he would not be taking a reasonable approach. However, it is conceivable that an additional stop could have an adverse effect on other services and if we inserted an undefined term, "significant", it could reduce the flexibility of the franchising director. We do not regard that as particularly helpful.

Amendment No. 278B would mean that the franchising director could refuse to implement the mayor's directions only if to do so would significantly increase the payments from his budget to franchise operators. I fear that the noble Baroness may have misunderstood the purpose of subsection (5)(c). We made clear in the White Paper that the mayor will have to pay for any additional rail services or facilities he or she secures through guidance to the franchising director. Subsection (5)(c) is designed to achieve that. It may be that there are cases where the effect on the franchising director's budget is so small that it can be disregarded. Again, we believe it right that the franchising director should have that flexibility. The amendment would mean that taxpayers outside London were footing the bill for London rail services ordered by the mayor. I am sure that that was not the intention of the amendment. I hope that in the light of those concerns the noble Baroness will not pursue her amendment.

Baroness Hantwee

I prefer an undefined "significantly" to an unstated "reasonably". The Minister's answer deserves reading properly. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 277KB not moved.]

Lord Whitty moved Amendments Nos. 277L to 277T: Page 85, line 5, after ("giving") insert ("instructions or") Page 85, line 6, after ("the") insert ("instructions or") Page 85, line 8, leave out ("so as") and insert ("in the manner best calculated") Page 85, line 9, after ("any") insert ("instructions or") Page 85, line 11, after ("any") insert ("instructions or") Page 85, line 12, at end insert ("implementing the instructions or guidance will") Page 85, line 13, leave out ("the guidance conflicts") and insert ("prevent or seriously hinder him from complying") Page 85, line 16, leave out ("implementing the guidance will")

On Question, amendments agreed to.

[Amendment No. 277TA not moved.]

Lord Berkeley moved Amendment No. 277U: Page 85, line 17, after ("passengers") insert ("and freight")

The noble Lord said: As we debated earlier, the amendment is concerned with the franchising director failing to give effect to instructions or guidance from the authority if he believes that it may have an adverse effect on passenger train services outside Greater London.

The franchising director will be busy because he also has a duty to promote rail freight. It would be unreasonable if implementing the guidelines had an adverse effect on rail freight as well as on rail passengers. The amendment would confine the adverse effect to outside Greater London. On reflection, there should be separate provision applying to outside and within Greater London. Freight must come into Greater London bringing concreting aggregates. If that were prevented because an extra passenger train had been instructed by the authority, all the aggregate would come in by road, which would be undesirable.

The drafting of the amendment may not be correct, but I urge my noble friend the Minister to consider whether there should be a reference to freight in this part of the Bill. I beg to move.

11.30 p.m.

Lord Whitty

My noble friend is quite right to raise the issue of freight, although I hope he will understand that we cannot accept his amendment. At present, the statutory responsibilities of the franchising director are concerned with the provision of passenger rail services and do not extend to freight. While it is true that the objectives, instructions and guidance issued by my right honourable friend the Deputy Prime Minister to the franchising director require him to take account of the effect on freight services of his other functions, it would not be appropriate to widen the franchising director's statutory responsibilities by way of the amendment. It would be a rather indirect and bizarre way to do it. We will have the opportunity to address this point in due course when we consider the legislation which my right honourable friend the Deputy Prime Minister intends to present which will formally establish the strategic rail authority, whose responsibilities will include rail freight. In the meantime, I should be grateful if my noble friend could withdraw his amendment.

Lord Berkeley

I am grateful to my noble friend for that explanation. I shall read it carefully and consider it. However, in the meantime I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Brabazon of Tara moved Amendment No. 278: Page 85, line 18, after ("London") insert ("and he can demonstrate that the benefit for railway passengers travelling inside or through Greater London is less than such adverse effect")

The noble Lord said: In moving this amendment I shall speak also to Amendment No. 279. These are two probing amendments which may in part have been answered already by what the Minister said in re-drafting his Bill, and also in reply to the noble Baroness, Lady Hamwee, on an earlier amendment.

As drafted, the Bill obliges the franchising director to ignore the GLA where there is any adverse effect outside London. I wonder whether the Government really mean that. These amendments would allow for the GLA requirement to go ahead where there is an overall net benefit to Londoners. Therefore, I hope that the Minister can explain what appears to me to be an inconsistency in the Bill. It also puts the onus of proof on the franchising director and strengthens the position of the GLA. I beg to move.

Lord Whitty

These two amendments would place an express duty on the franchising director to demonstrate why he should not, in certain circumstances, implement the mayor's guidance in respect of rail services. Amendment No. 278 would place an express duty on the franchising director to demonstrate that implementing the mayor's guidance would have an adverse impact outside London greater than the benefit to passengers travelling within or through London.

Clause 161(6) already requires the franchising director to notify the mayor if he decides not to implement guidance and to give his reasons. It would be open to the mayor to seek a judicial review of the decision if he thinks it unlawful, but we think it much more likely that instead of rejecting the mayor's guidance out of hand, the franchising director will want to work with the mayor and with TfL to work out how the guidance can be framed so that it reflects the mayor's requirements within the constraints imposed by the Bill. The duty of co-operation is imposed on the franchising director and on TfL by Clause 137.

Moreover, the franchising director's decisions on whether implementing the guidance will have an adverse impact outside London will inevitably involve making judgments, or, if so trivial, dismissing it as de minimis. The amendments would remove that flexibility. We do not believe that it would be helpful to either the franchising director or the mayor to be so rigidly prescriptive on how the franchising director should advise the mayor on how his or her requirements can best be catered for.

Amendment No. 279 would place an express duty on the franchising director to demonstrate that the benefits for railway passengers travelling inside or through Greater London and implementing the mayor's guidance do not justify increased budget payments to train operators from the franchising director's budgets.

I fear that the amendment may be based on a misunderstanding of the purpose of Clause 161(5)(c). The purpose of that provision is to give effect to the commitment in the White Paper that it is to be the mayor and not the franchising director who meets any net costs incurred by train operating companies as a result of the implementation by the franchising director of the mayor's guidance. Again, the franchising director will no doubt advise the mayor as to the most cost-effective way in which his or her requirements can be made. I hope with that explanation that the noble Lord will withdraw his amendment.

Lord Brabazon of Tara

I am grateful to the noble Lord for his response. I shall read carefully what has been said. I suspect that he meets the points that I made in my amendment. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Whitty moved Amendment No. 278A: Page 85, line 19, leave out ("implementing the guidance will")

On Question, amendment agreed to.

[Amendments Nos. 278B and 279 not moved.]

Lord Whitty moved Amendments Nos. 279UA, 279VA and 279WA: Page 85, line 22, after ("any") insert ("instructions or") Page 85, line 25, after ("which") insert ("instructions or") Page 85, line 26, leave out ("5(1)") and insert ("5(1)(a)")

On Question, amendments agreed to.

Clause 161, as amended, agreed to.

Lord Whitty moved Amendment No. 279XA: After Clause 161, insert the following new clause—

FRANCHISING DIRECTOR TO CONSULT MAYOR AS TO FARES, SERVICES ETC

(" .—(1) The Franchising Director shall from time to time consult the Mayor as to—

1. (a) the general level and structure of the fares to be charged for the carriage of passengers by railway on services to which this section applies; and
2. (b) the general level of the provision to be made for such services.

(2) The services to which this section applies are services to, from or within Greater London—

1. (a) which are, or are to be, provided under franchise agreements: or
2. (b) whose provision the Franchising Director is under a duty to secure, by virtue of section 30, 37 or 38 of the Railways Act 1993 (which relate to the failure to secure a subsequent franchise agreement and the proposed discontinuance of services).")

On Question, amendment agreed to.

Clauses 162 and 163 agreed to.

Lord Whitty moved Amendment No. 279YA: After Clause 163, insert the following new clause—

TRANSPORT FOR LONDON: CONTRACTS REQUIRING PASSENGER LICENCES

(" .—(1) Transport for London may not by virtue of any provision of this Act or any other enactment enter into or carry out any agreement with respect to the provision or retention, or financing, of public passenger transport services if the agreement—

1. (a) is one which involves the holding of a passenger licence: and
2. (b) is not an excepted agreement.

(2) An agreement "involves the holding of a passenger licence" for the purposes of this section if it involves the doing by any person, whether or not a party to the agreement, of anything which, by virtue of section 6 of the Railways Act 1993 (prohibition on unauthorised operators of railway assets), that person may not do without the authorisation of a passenger licence.

(3) An agreement is an "excepted agreement" for the purposes of this section if it is—

1. (a) an agreement with the Franchising Director; or
2. (b) an agreement under section (Provision of extra passenger transport services and facilities) above, other than one falling within subsection (4) below.

(4) An agreement falls within this subsection if, in pursuance of the agreement. Transport for London or a subsidiary of Transport for London is to enter into a further agreement which involves the holding of a passenger licence.

(5) Expressions used in this section and in Part I of the Railways Act 1993 have the same meaning in this section as in that Part.")

On Question, amendment agreed to.

Clause 164 agreed to.

Baroness Thomas of Walliswood moved Amendment No. 279YAZA: After Clause 164, insert the following new clause—

ARRANGEMENTS WITH FRANCHISE OPERATORS

(" .—(1) Without prejudice to their general duty under section 123 of this Act, it shall be the special duty of Transport for London—

1. (a) to review as soon as may be, and subsequently keep under review, the railway passenger services provided by franchise operators for meeting the needs of persons travelling between places in London or between places in London and places outside that area but within fifteen miles from the GLA boundary; and
2. (b) to enter into such agreements with franchise operators and the Franchising Director as the Mayor may approve for securing that the franchise operators and the Franchising Director provide such railway passenger services as the Mayor decides to be necessary to ensure that such services make a proper contribution towards the provision for London of such a system of transport as is referred to in section 123(1) of this Act.

(2) The franchise operators and Franchising Director shall furnish Transport for London with any information which Transport for London may reasonably require for the purposes of the discharge of its functions under subsection (1) of this section.

(3) Any agreement under this section may include provision for the making of payments by Transport for London to franchise operators in respect of the railway passenger services provided by franchise operators in pursuance of the agreement.

(4) Before entering any agreement under this section, Transport for London shall send a copy of the proposed agreement to the Minister; but a failure to comply with this subsection shall not affect the validity of the agreement.

(5) If any dispute arises between Transport for London, the Franchising Director and the franchise operators in connection with the provision of subsections (1) or (2) of this section, any of them may require the dispute to be referred to the Minister for determination, and any agreement under the said subsection (1) may include provision for any dispute in connection with the agreement to be so referred, and where any dispute is referred to the Minister under or by virtue of this subsection, the Minister may give such directions to Transport for London, the Franchising Director and the franchise operators with respect to the dispute as he thinks fit.

(6) The Minister may, with the approval of the Treasury and in any particular case he considers it proper to do so, make grants to Transport for London towards any expenditure incurred by Transport for London by reason of any agreement entered into under subsection (1)(b) of this section.")

The noble Baroness said: We tabled this amendment in the form of a new clause which gives a specific duty to Transport for London. I am bound to say that I did not grasp every word said by the Ministers in the preceding hour and it may be that everything we are asking for is in some way subsumed in what they have already done. I apologise if that is the case, but I am sure they will understand that it is not always easy to grasp the relationship of one provision with another.

The context of this amendment is the enormous importance of rail transport in London and therefore its importance to the authority and to Transport for London—the active part of the delegated body for transport matters. The clause requires Transport for London to keep under review passenger rail services in London and 15 miles around London. It also enables Transport for London to enter into agreements with franchise operators and the franchising director, with the approval of the mayor, for securing railway services.

The agreements that are made to secure such services can involve provision for the making of payments by Transport for London to franchise operators, and the Minister may, with the approval of the Treasury and in any particular case he considers it proper to do so, make grants to Transport for London towards any expenditure incurred". There are some further elements to the amendment. For instance, The franchise operators and Franchising Director shall furnish Transport for London with any information which Transport for London may reasonably require … If any dispute arises between Transport for London, the Franchising Director and the franchise operators", anyone can refer that dispute to the Minister and it will be so referred.

I believe that the objectives of this amendment are very clear. They are to give TfL a direct influence and power to intervene in the provision of rail services in London and in the area immediately adjacent. I beg to move.

Baroness Farrington of Ribbleton

I, too, hope that I will be able to persuade the noble Baroness, Lady Thomas of Walliswood, that this amendment is unnecessary because these issues are already provided for in the Bill. Subsection (1)(a) of the amendment places a special duty on TfL to review the operation of franchise passenger rail services in London and, as the noble Baroness said, within 15 miles of the Greater London boundary. That would be in addition to the mayor's general transport duty under Clause 123. However, the mayor's general duty in that clause effectively includes the rail duty envisaged by this subsection. Including this subsection might also call into question the mayor's duty in respect of other transport modes which are not similarly specified.

Subsection (1)(b) places a duty on TfL to enter into agreements approved by the mayor with rail franchisees and the franchising director for the provision of rail services which will contribute to the discharge of the mayor's general transport duty. This is unnecessary because other provisions of the Bill effectively place such a duty on the mayor and give TfL powers to enter into such agreements.

Clause 136(3), for example, provides that TfL, may enter into agreements with other persons for the provision of public passenger transport services. Clause 136(6) provides that such agreements may include provisions for combined services for the through carriage of passengers or goods and for TfL to be able to make payments to the other party. In addition, Clause 137, which deals with co-operation with the franchising director, gives TfL and the franchising director the power to enter into agreements with one another by virtue of subsection (2).

It may be helpful if I mention that TfL's ability to procure additional rail services from franchisees is qualified by Amendment No. 279YA, standing in the name of my noble friend, Lord Whitty, so that TfL must procure those services through the franchising director. There are good reasons for that, but the principle that TfL will have a mechanism to enter into agreements still holds good.

Subsection (2) of the amendment places a duty on the franchising director and franchisees to provide TfL with any information that it may require for the purposes of subsection (1). The franchising director is already under such an obligation by virtue of Clause 137, but there are a number of other ways in which local authorities and TfL can obtain information from the franchising director and franchise operators. If the noble Baroness would like me to, I can write to her in greater detail on that aspect.

Subsection (3) of the amendment provides that TfL can make payments to franchise operators. The Bill already provides for this. Agreements between TfL and the franchising director will rest on the powers in Clauses 136 and 137, which were previously described. Agreements involve the performance of obligations by the parties, the most common of which is the payment of money. In addition, it is clear from Amendment No. 279YA, which deals with contracts requiring passenger licences, that agreements for the financing of passenger services are contemplated. So there is no reason here for an additional specific power to pay being included.

Subsection (4) of the amendment would put TfL under a duty to provide the Minister with a copy of any agreement with the franchisee which TfL proposes to enter into. But he is already able to be informed of such proposals because TfL will enter into such agreements through the franchising director by virtue of Amendment No. 279YA. The Railways Act 1993 provides for the franchising director to provide the Secretary of State with such information.

As the London White Paper made clear regarding the power of the Minister to settle disputes, we envisage a co-operative relationship between TfL and the franchising director which is why we have provided each of them—by virtue of Clause 137—with a duty to co-operate. In addition, Amendment No. 279XA places a duty on the franchising director to consult the mayor over fare and service levels on London rail services. So we do not see a need for a direct statutory role for the Secretary of State. We see the Secretary of State having a minimum involvement.

As my honourable friend the Minister for Transport in London made clear earlier in the passage of the Bill, should there be a difference it is open to the Secretary of State to intervene. I believe that I have answered the points raised. I apologise to the Committee for the detail. However, I am absolutely convinced that on reading the detail it will become apparent that further amendments at later stages in the passage of this Bill will not be necessary.

11.45 p.m.

Baroness Hamwee

We surrender!

Baroness Thomas of Walliswood

I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 165 agreed to.

Lord Whitty moved Amendment No. 279YAA: After Clause 165, insert the following new clause—

PROCEDURE FOR CLOSURE OF CERTAIN RAILWAY PASSENGER SERVICES

(" .—(1) The Railways Act 1993 shall have effect as if any railway passenger services provided under or by virtue of this Act by Transport for London or a subsidiary of Transport for London (in relation to which section 37 of that Act does not have effect, in consequence of amendments made by section 162 above) were designated by order under section 49(3) of that Act as railway passenger services in relation to which Schedule 5 to that Act (alternative closure procedure) is to have effect.

(2) Schedule 5 to the Railways Act 1993 shall be amended as follows.

(3) After paragraph 5 there shall be inserted—

"Qualifying services in and around Greater London

5A.—(1) This paragraph applies to any qualifying services—

1. (a) which are provided by Transport for London or a subsidiary of Transport for London; or
2. (b) which do not fall within paragraph (a) above but—
1. (i) are provided wholly within Greater London; and
2. (ii) are services, or services of a class or description, designated in an order made by the Secretary of State as services in relation to which this paragraph is to apply; and in the following provisions of this paragraph any such services are referred to as "qualifying London services".

(2) In the application of the other paragraphs of this Schedule in relation to qualifying London services, for any reference to the Secretary of State there shall be substituted a reference to the Mayor of London.

(3) Where the Mayor of London has given consent under paragraph 3(2)(b) above in respect of services provided wholly or partly outside Greater London, any person aggrieved by the decision to give consent may refer that decision to the Secretary of State.

(4) A referral under sub-paragraph (3) above shall be made by giving notice to the Secretary of State.

(5) Any notice under sub-paragraph (4) above must be given not later than 4 weeks after the date of the decision referred.

(6) On a reference under sub-paragraph (3) above, the Secretary of State may—

1. (a) confirm the decision to give consent;
2. (b) in the case of a decision to give consent subject to conditions, confirm the decision to give consent but modify the conditions; or
3. (c) substitute his decision for that of the Mayor of London.

(7) Any person who refers a decision to the Secretary of State under sub-paragraph (3) above shall provide, with his notice under sub-paragraph (4) above, a statement of the reasons why he is aggrieved by the decision.

(8) On disposing of any reference under sub-paragraph (3) above, the Secretary of State shall give notice of his decision to—

1. (a) the Mayor of London;
2. (b) the appropriate consultative committee;
3. (c) the operator concerned; and
4. (d) the person who referred the decision to the Secretary of State under sub-paragraph (3) above (if not falling within paragraphs (a) to (c) above).

(9) Before the expiration of the period of six weeks following the making of his decision on a reference under sub-paragraph (3) above, the Secretary of State shall publish notice of his decision—

1. (a) in two successive weeks in two local newspapers circulating in the area affected; and
2. (b) in such other manner as appears to him appropriate.'"').

The noble Lord said: The purpose of this amendment is to carry forward the existing procedure for discontinuance of Underground and DLR services and those to be operated on the Croydon Tramlink. I must stress that while it is sometimes necessary temporarily to discontinue services for maintenance or refurbishment purposes, permanent closures are an infrequent occurrence. However, it is right that the Bill should provide for them in keeping with our commitment in the London White Paper that the mayor and TfL will inherit LT's current responsibilities.

The only significant change which the amendment makes to the current procedures is that it will be the mayor who takes decisions on closures rather than the Secretary of State with the proviso that for TfL services wholly or partly outside London those aggrieved by a mayoral decision will have a right of appeal to the Secretary of State. In those cases the Secretary of State will have the power to confirm the mayor's decision, with or without conditions, or substitute his own decision.

This amendment applies the new procedure directly to services provided by TfL. However, it will be necessary to apply the procedure by order of the Secretary of State if the relevant service is not directly provided by TfL, such as Croydon Tramlink and, of course, the Docklands Light Railway. I commend the amendment to the Committee. I beg to move.

On Question, amendment agreed to.

Clause 166 agreed to.

Lord Whitty moved Amendment No. 279ZA: After Clause 166, insert the following new clause—

SECRETARY OF STATE TO CONSULT MAYOR BEFORE CHANGING AMOUNT OF PENALTY FARE

(" .—(1) Section 130 of the Railways Act 1993 (penalty fares) shall be amended as follows.

(2) After subsection (9) there shall be inserted— (9A) Before making any regulations which have the effect of varying the amount, or the greatest amount, which a person within, or travelling to or from, Greater London may be charged by way of penalty fare, the Secretary of State must consult the Mayor of London.".").

On Question, amendment agreed to.

Lord Whitty moved Amendment No. 279A: After Clause 166, insert the following new clause—

RESTRICTIONS ON CONTRACTING OUT CERTAIN SERVICES

(" .—(1) For the purposes of this section, the services which are "reserved services" are those whose provision by a person would involve that person in performing or securing the performance, for the purposes of any TfL passenger rail service, of—

1. (a) any station-operating function; or
2. (b) any train-operating function.

(2) Transport for London shall not, without the consent of the Secretary of State, enter into or carry out any agreement under which an outside contractor is to provide or secure the provision of a reserved service for Transport for London or a subsidiary of Transport for London.

(3) Where a company which is a subsidiary of Transport for London provides or is to provide, or secures or is to secure the provision of, a reserved service for Transport for London or a subsidiary of Transport for London, Transport for London shall not, without the consent of the Secretary of State, enter into any transaction or series of transactions the result of which would be that the company—

1. (a) would cease to be a subsidiary of Transport for London; but
2. (b) would nevertheless provide or continue to provide, or secure or continue to secure the provision of, the reserved service.

(4) Nothing in this section applies in relation to a contract of employment between an individual and Transport for London or a subsidiary of Transport for London.

(5) The Secretary of State may by order provide exceptions from subsection (2) or (3) above.

(6) Any consent of the Secretary of State under this section must be in writing and—

1. (a) may be given in relation to any particular transaction or description of transactions; and
2. (b) may be given subject to conditions.

(7) For the purposes of this section— station-operating function" means any of the following functions—

1. (a) the sale or collection of tickets at stations;
2. (b) the inspection of tickets, or the imposing of penalty fares, at or in the vicinity of a station, but otherwise than on a train;
3. (c) the making of oral public announcements at stations;
4. (d) the provision of information orally to members of the public at stations, otherwise than by means of public announcements;
5. (e) any duties of staff employed on platforms at stations;
6. (f) any duties of staff employed at a place from which the operation of the whole or part of a station is controlled (whether or not the operation of trains is also controlled from that place);
7. (g) any other function involved in the management or operation of a station;

train-operating function" means any of the following functions—

1. (a) the driving of passenger trains otherwise than within a depot;
2. (b) any duties of guards on passenger trains;
3. (c) the sale, collection or inspection of tickets, or the imposing of penalty fares, on passenger trains;
4. (d) the operation of signals for controlling the movement of passenger trains otherwise than within a depot;
5. (e) the exercise of control over the movement of passenger trams otherwise than within a depot;
6. (f) any other function involved in the operation of passenger trains otherwise than within a depot.

(8) In this section— contract of employment" means any contract of service or apprenticeship; outside contractor" means a person other than Transport for London or a subsidiary of Transport for London; passenger train" means a train which is being, has just been, or is about to be, used for the provision of a TfL passenger rail service; premises" includes any land, building or structure; railway" has the meaning given in section 67(1) of the Transport and Works Act 1992; reserved service" shall be construed in accordance with subsection (1) above; station" means any land or other property which consists of premises used as, or for the purposes of, or otherwise in connection with, a railway passenger station or railway passenger terminal (including any approaches, forecourt, cycle store or car park), whether or not the land or other property is, or the premises are, also used for other purposes; TfL passenger rail service" means any public service for the carriage of passengers by railway which is under the control of Transport for London or a subsidiary of Transport for London; ticket" includes any other authority to travel or to be present in a part of a station where such an authority is required.

(9) The Secretary of State may by order amend this section for the purpose of varying the meaning in this section of any of the following expressions—

1. (a) "train-operating function";
2. (b) "station-operating function";
3. (c) "outside contractor"; or
4. (d) "TfL passenger rail service".")

The noble Lord said: The purpose of the proposed new clause is to ensure that the Underground trains and stations continue to be operated by a publicly owned, publicly accountable London Underground. That is in line with a commitment that my right honourable friend the Deputy Prime Minister gave on 15th June.

We believe it is entirely right and clearly in the best interests of those using this key component of London Transport that the public face of the Underground should remain accountable to the people who use it. But the new clause also recognises the reality that many of the non-core activities which are needed to support the operation of the Underground are carried out by the private sector, normally under contract to London Underground Limited. Of course, the services of the Docklands Light Railway are, or will be, provided by concessionaires. It is not our intention to change those arrangements, although it will be open to the mayor to do so if he or she wishes if and when the current commercial arrangements end.

The new clause places restrictions on TfL's ability to franchise or contract out London Underground services which impinge directly on the travelling public. The clause provides that TfL must not, without the consent of the Secretary of State, enter into agreements with outside contractors for specified reserve services; that is, certain station and train operating functions. These functions are specified in subsection (7) of the new clause.

Subsection (5) enables the Secretary of State, by order subject to the negative procedure, to make exceptions to these restrictions. Subsection (9) of the new clause enables the Secretary of State to redefine the meaning of particular terms. This will be done by negative procedure in order to give some flexibility to the process. Subsection (6) provides that the Secretary of State's consent to franchising-in and contracting-out be given administratively and will be able to be given in respect of classes of activity as well as individual cases. The Secretary of State's consent must also be obtained if TfL wishes to dispose of a TfL subsidiary which carries out any of the restricted functions. Subsection (3) provides for that. Subsection (4) excludes contracts of employment from the restrictions so that TfL is free to employ staff directly to carry out the train and station operating functions.

We think that the new clause offers reassurance to the travelling public that key Underground functions will continue to operate in a spirit of public service. I beg to move.

On Question, amendment agreed to.

Clause 167 [PPP agreements]:

[Amendment No. 280 not moved.]

Clause 167 agreed to.

Lord Clement-Jones moved Amendment No. 280VA: After Clause 167, insert the following new clause—

VALUE FOR MONEY ASSESSMENT

(" . Before any PPP agreement is, entered into the Authority shall be required to have carried out and published an economic assessment in respect of the life of the agreement which demonstrates that such PPP agreement represents value for money at least comparable to that which would have been available through a publicly financed arrangement.")

The noble Lord said: The reasons for this amendment are twofold. The first is the reluctance of the Government to reveal the detail of the modelling underlying the PPP scheme that they are adopting. The Government are proposing contracts which should last for 30 years, yet they are withholding vital information, principally that contained in the original Price Waterhouse report, for reasons of commercial confidentiality.

In Committee in another place, the Minister for Transport in London said: We have thought carefully about releasing the information … To be of any use we would need to release a large amount of material, much of which would be helpful to bidders. That would prejudice London Underground's negotiating position in the PPP competition, so we shall not release that modelling". But the authors of the LSE papers in June last year and in March this year said: neither Parliament nor the general public has any means of assessing the nature of the risks they are being asked to take on". The only response to that position is to ensure that other control mechanisms are included in the Bill to at least ensure that the economics of the PPP are transparent.

Secondly, in the bidding process the Government are duty bound to ensure "best value". The Government recognised this in their response to the Select Committee report on London Underground. They said: Clearly, it is only possible conclusively to demonstrate that the current proposals represent best value once bids have been received. At that stage we will need to satisfy ourselves that the deal is really right". In the same paragraph the Government commit themselves to developing a comparator against conventional public sector funding. This will help to assess the bids and ensure that we actually obtain the value for money we expect".

The Minister for Transport in London made an even clearer statement to the Standing Committee in another place on 25th February. She said: … the public sector—namely London Underground, which will remain in the publicsector, as it is now—will be the benchmark against which all private bids will be measured … we will not be awarding contracts irrespective of the value of the bid. Best value will be the watchword".

This amendment is designed to ensure that the Government live up to that pledge and that the economics of the PPP proposals are completely transparent. I beg to move.

Lord Whitty

I do not think that there is a difference of principle in this amendment. The amendment requires the GLA to carry out a public sector comparator exercise before any PPP contracts are signed to show that the contracts are at least comparable on value-for-money grounds with the Underground remaining within the public sector, We have no intention of proceeding with any aspect of the PPP unless we are convinced that the contracts offer best value for passengers and taxpayers.

However, to ask the GLA to undertake this exercise would be inconsistent with the Government's intention—this has been made known throughout our statements—to see through the PPP negotiations before transferring the Underground to TfL.

In those circumstances, the terms of the noble Lord's amendment are not appropriate. I therefore ask him not to pursue it.

Lord Clement-Jones

Before doing that, I must ask the Minister: if the TfL were to ensure: that the public sector comparator was in place, would that be acceptable to the Government?

Lord Whitty

No. My point is that the comparator for the PPP would be established by the Secretary of State before the PPF' handed over either to the mayor or to TfL. Therefore, the Secretary of State would carry out the comparator exercise.

Lord Clement-Jones

In that case, my question remains the same, except I substitute the Secretary of State for Transport for London. If the Minister were to commit to conducting a public sector comparator in the name of the Secretary of State in those terms and were to agree that that should be in the primary legislation, it would be most satisfactory.

Lord Whitty

We are committed to conducting a public sector comparator exercise. As for publishing the details of that exercise, it depends when the noble Lord suggests that that should occur. If they were published before contracts were signed—I think that is the intention—there would be a problem. The tenderers would clearly not have much of an incentive to go as low as they might because they would simply have to beat the public service comparator. Therefore, we would not publish at that stage. However, once the competition is concluded, the full details will be made available through the National Audit Office in the usual way.

Lord Clement-Jones

I think that I can see some chinks of daylight in the Minister's comments. The issue may revolve largely around timing, but I suspect that it revolves also around the Government's commitment to conducting the exercise and putting it in the Bill in a concrete fashion. At this stage in the proceedings, the best thing for me and my colleagues on these Benches to do is to read what the Minister has said to see whether we can return with something slightly more satisfactory at Report stage.

I do not think that we are a million miles apart. I can understand the Minister's reasons for saying that the Government would not necessarily want to publish before contracts were concluded. On the other hand, that might be the point when the Government were perfectly able to say, "This is the PPP company we wish to proceed with and these are our reasons for doing so".

I am not sure that I fully understand the Minister's reasons, but we will consider over the next few days what he has said. In the meantime, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Clement-Jones moved Amendment No. 280WA: After Clause 167, insert the following new clause—

GENERAL LEVEL OF FARES UNDER PPP AGREEMENT

(" .—(1) In exercising his powers under section 134(l) to determine the matters specified in section 135(2)(a), the Mayor shall ensure that the general level of fares to be charged by Transport for London for railway services in respect of which a PPP agreement has been entered into is no more than the general level 12 months previous to that time increased by a percentage equal to the control rate.

(2) In subsection (1) above the control rate shall be at any lime the number of percentage points by which the most recently available figure for the retail prices index has increased on the retail prices index for the month 12 months previous to that figure less the factor X.

(3) In subsection (2) above—

1. (a) "the retail prices index" is the general index of retail prices (for all items) published by the Office of National Statistics, and if that index is not published for a month which is relevant for the provisions of this section then this section shall be construed as referring to any substitute index or index figures published by that Office; and
2. (b) "the factor X" shall, prior to 1st April 2002, be equivalent to two percentage points, and on or after 1st April 2002 shall be equivalent to one percentage point.")

The noble Lord said: In the financial structuring of the PPP, it appears that the pay-back provisions to the private contractors will depend heavily on significant annual profits being earned by London Underground. The authors of the LSE papers that I mentioned earlier estimate those to be approximately £450 million per year. However, in a recent paper they make the point that, while London Underground has generated significant growth in operating revenues of £210 million in 1996–97 and £264.7 million in 1997–98, those have been notably lower than the figure they estimate will be required in any future repayment schedule for the PPP.

The requirements to make this level of profit will apply during each year of the 30 years of the contract. So how will those levels of profit be made? In its assumptions about PPP, London Underground seems to have assumed that passenger numbers will continue to grow and that fares will rise by 1 per cent above inflation in each year for a number of years. The need for real fare increases of this size has been affirmed first of all and then denied by the Minister for Transport in London in the Standing Committee in another place. But, in response to the Select Committee, the Government said: It is not our policy to see large increases in public transport fares. Our proposals are not based on such increases. The PPP will not be dependent on significant increases in fares". However, that at least some real fare increases will be needed is the only conclusion that one can draw.

Chantrey Vellacott, the chartered accountants, have produced a briefing note which concludes that fares may have to rise by as much as 30 per cent, which would clearly be unacceptable. It follows that the Government seem confused about what the necessary subsidy will be. For instance, in their response to the Select Committee report on London Underground, they have stated that there are no provisions in their plans for central government subsidy after the year 2000. Yet at the Committee stage in another place the Minister for Transport in London seems to have conceded that, if it represents good value for money, part of the central government grant to TfL could go to the PPP contractor.

What is the true position? As the noble Lord can see, this amendment on pricing is designed as a probing amendment. What is the true position; or, as I should say, what is today's position? What real underlying assumptions are the Government using? I hope that the Minister can shed some light on all these aspects. I beg to move.

Midnight

Lord Brabazon of Tara

I rise to support the principle of the amendment, as it follows closely an amendment standing in my name which we debated earlier and which covered the whole of TfL rather than just the London Underground. I notice that the noble Lord, Lord Clement-Jones, is being slightly more generous to TfL in factor x. But from what was said previously, I think it would be unwise to put figures in that paragraph. One would probably want to see what the books looked like before one put that in. The noble Lord is right to say that the accountants' report suggested that fare increases of 30 per cent would be necessary to finance the PPP. I, too, shall be interested to hear what the Minister has to say in response to that.

Lord Whitty

The Chantrey Vellacott report, never mind the somewhat scaremongering headlines which emanated from it, is based on a misapprehension; that misapprehension primarily arising from the notion that the whole of the £7 billion of additional investment that one wants in the underground network would come from up-front borrowing. Clearly, some of it would come from the income of London Underground in normal circumstances and from efficiency savings contributing to that. There is not a presumption that all of that would be raised from the market. That is what led to the differential fares implication being drawn by Chantrey Vellacott but it was based on a serious misapprehension.

The amendment would run counter to our giving the flexibility to the mayor to decide what the wholly appropriate levels of fares should be. It offers a very prescriptive indication of fare levels, increasing them by RPI minus 2 per cent until 2002, and by RPI minus 1 per cent thereafter. The mayor must have some flexibility in this regard, and TfL may well want to vary the rate at which fares are increased, or indeed the frequency with which they are increased. This kind of provision is therefore not very sensible.

As to the more general speculation, irrespective of Chantrey Vellacott, that the cost of the PPP would be loaded onto fares, that is completely the wrong impression. It is based on a misconception that fares will have to increase substantially to cover the costs identified in the report and in some of the newspaper coverage.

The substantial savings which London Underground will be able to make through having stable long-term investment programmes that it has not hitherto been able to make when it has had to compete with other public sector demands will be a major contribution to a stable fares situation. That is not achieved by prescription from above, because the mayor will need to make a judgment, based on TfL's corporate planning, as to what the level of fare increase or fare structures should be. That responsibility should rest with the mayor.

Lord Clement-Jones

I thank the Minister for that response. However, this probing amendment is an attempt to get to the nub of the Government's assumptions in regard to the PPP. That is why I tabled the amendment specifically in relation to the relevant PPP clause.

A great deal of confusion seems to have been raised in the minds of Members in Committee about the Government's assumptions, and the assumptions of London Underground, about the fare rises which were anticipated and which formed the basis of the assumptions about the success or otherwise of the PPP. At one stage, the Minister for Transport in London said that, as in the London Underground paper published in March, a figure of 1 per cent above the rate of inflation was a valid assumption for the revenues of Transport for London. But, shortly afterwards, that statement was retracted. Yet it had appeared in the London Underground paper. The transparency surrounding those assumptions is extremely important when people are looking at the future and in particular at the proposed PPP scheme.

Lord Whitty

There is a confusion between reasonable presumptions that may have been made in certain contexts at various times and what the final negotiated settlement of the PPP will be. Clearly, built into the final package will be some presumption of underlying changes of fare. But that is by no means determined. We need to look at the nature of the negotiations for the PPP before we arrive at that point. But, even without any of those figures as regards the underlying trend, we should still want to leave considerable flexibility to TfL and the mayor thereafter as regards annual increases in fares, the structure of fares and the frequency of fare increases. Therefore, specifying figures that relate to the RPI for annual increases is not very sensible. It is a very constraining approach. The allegations that the cost of borrowing would be wholly loaded on fares was, as I have said, based on a wrong assumption of how much of the additional investment requirement would be met from new borrowed funds.

Lord Clement-Jones

I am sorry to press this point, but it is very important. There has been a great deal of debate. With respect, the Minister has not yet explained why the Minister for Transport in London mentioned the figure of 1 per cent above the level of inflation and, for instance, why London Underground mentioned the 1 per cent figure in its paper.

I can well understand that assumptions shift from time to time, and when the Government finally goes nap on a PPP proposal, a different set of fare rise assumptions may take place. But it was my understanding—and having read Hansard it seems crystal clear—that the Minister for Transport in London mentioned a figure of 1 per cent above the rate of inflation. I do not understand why that figure was mentioned if it is of no relevance at all to our debate.

Lord Whitty

I do not think it is of relevance to our debate on these clauses as regards what powers and restraints it will place on the mayor. Clearly, London Transport have to make certain presumptions about the underlying rate of price increases. In the circumstances, that presumption, had nothing changed, may have been a reasonable decision for London Transport, but it is not a reasonable indication of what the outcome of the PPP would be.

Lord Clement-Jones

I thank the Minister for that reply. I shall not press him any further. However, I feel that the situation is unsatisfactory. The whole architecture of PPP is based on certain economic and financial assumptions. Absolutely central to those assumptions are matters like the rate of fare increases. I shall read Hansard to see what the Minister has said. That underlying reality, which may shift from time to time, is of great importance. I believe that some reassurance to the general public would be extremely useful. As the Minister has said, there have been a number of scare stories. I do not necessarily believe that one needs to attach great credence to the Chantrey Vellacott report, but we have a wide range of estimates about the effect of PPP which need allaying. In the meantime, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Clement-Jones moved Amendment No. 280XA: After Clause 167, insert the following new clause—

PPP AGREEMENTS: REQUIREMENT TO MEET EU TENDERING RULES

(" . Before any PPP agreement is entered into the Authority shall be required to have satisfied itself that any such PPP agreement meets the requirements of European Union tendering rules.")

The noble Lord said: Amendment No. 280XA carries forward the debate started earlier this week at Question Time when my noble friend Lady Ludford asked about the scope of European Union tendering rules. On Tuesday, in reply to my noble friend, the Minister appeared to be adamant that PPP contracts would come under Part B of the utilities directive and the regulations made under that directive and that, therefore, the full European competitive regime for tendering would not apply. Hence, the possibility of only a single bidder for these sub-surface lines.

As my noble friend made clear, only operating services for rail fall into Part B. The infrastructure is the subject of the PPP and that surely constitutes engineering works for the purposes of the regulation. In that event, the tendering process needs to be on a competitive basis unless there are specific reasons for it to fall within the restricted or negotiated procedure. Currently, I cannot see any grounds for exclusion in the regulations. I have read them fairly carefully over the course of today.

Can the Minister confirm whether, since Tuesday, he has been able to take further counsel on this matter? Is there a written legal opinion on the subject? If there is, will the Minister publish it? I beg to move.

Lord Whitty

The noble Lord will know that it is not the normal practice for departments and government Ministers to publish legal advice, and there is no particular reason to depart from that in this case.

We have had consistent views that such services would fall under Part B and, therefore, would be excluded from the full competition requirements. There are certain marginal areas, but if the main services fall under Part B, they are excluded. Clearly, we intend to abide by the European tendering rules and where any doubts are expressed we would need to consider them before we proceeded. We are in a defensible position in that the content of any such contract—this applies to all three potential contracts and not simply the Railtrack one—could be deemed to be outside Part B of the regulations.

I do not know what more I can say to the noble Lord. That seems to us to be the position and we do riot believe that it conflicts with the European legislation.

12.15 a.m.

Lord Clement-Jones

I thank the Minister for that reply. I still have doubts, having read the regulation. The companies are referred to in short as infraco. They deal with infrastructure, not rail services, which the operating companies provide. I suspect that the department may be optimistic. It would be unfortunate if it was subsequently discovered that the department was not complying with the regulations.

I hear what the Minister says. No doubt further advice will be taken on all sides. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Clement-Jones moved Amendment No. 280YA: After Clause 167, insert the following new clause—

REVIEW OF PPP AGREEMENTS

(" . The Authority shall review the operation of any PPP agreement and the performance of the PPP company under it three years after it has been entered into.")

The noble Lord said: As has been made clear, once the PPP arrangements are up and running there will be a series of periodic reviews under the contracts—say three, which means that they will be at approximately seven-year intervals. The details of the reviews and the way in which they will be carried out are given in London Underground's March 1999 progress report on the PPP.

That is all very well and fine, but the PPP arrangements are untried and will be for some years to come. Many of us believe that they are unworkable. It will be important for the authority to take an overview of the performance of the PPP companies under the contracts, so that Transport for London can take early corrective action well before the first review by the arbiter. That is not so much to negotiate on infrastructure service charges or bid rates of return, which are properly matters for the contractual review at seven-year intervals, but to reassure Londoners in a transparent way that the PPP structure is performing as it should. That review should be the responsibility of the authority as a whole, rather than Transport for London, because the political dimension will be important. I beg to move.

Lord Whitty

The noble Lord is correct that there will be explicit provision in the PPP contracts for periodic reviews every seven to eight years. That will provide a fundamental opportunity to review the underground services, requirements, investment priorities and the future of the contractual obligations and to amend those obligations and the performance criteria to reflect the performance up to that point.

In addition, the performance of the PPP companies will be kept under constant review by London Underground. London Underground's performance resulting from those contracts will, as the noble Lord is seeking, be kept under constant review by the mayor through TfL. The fact that we shall have fundamental detailed periodic reviews built into the contract only every seven or eight years does not mean that there will not be regular reviews at the executive political level, as well as by the management interfacing with the PPP company. I hope that that reassures the noble Lord and that he will see fit to withdraw his amendment.

I am informed that during the debate on the previous amendment concerned with directives I said that the PPP contracts would be outside Part B. I meant that they would be inside Part B and therefore outside the requirement to go through the full European tendering process.

Lord Clement-Jones

I certainly took the Minister to mean what he has just said by way of clarification. I thank the noble Lord for his response. At this stage of the evening I do not quibble about the nature of the reviews. We on these Benches believe that something rather more formal should appear in primary legislation to allow a real marker to be put down after a three-year period so that the public can see clearly how these contracts are performing. That is separate from the contractual review itself. We shall consider the matter further in the light of the Minister's comments. In the meantime, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Clement-Jones moved Amendment No. 280ZA: After Clause 167, insert the following new clause—

ESTABLISHMENT OF PUBLIC INTEREST COMPANY

(" .—(1) If PPP agreements have not been entered into in respect of the whole railway network by 1st July 2000, the Authority shall be permitted to establish a public interest company as defined by subsection (2) below to operate the relevant part of the railway network.

(2) In this section, "public interest company" means a company—

1. (a) a majority of whose issued shares are held by or on behalf of any of the bodies or persons falling within paragraphs(i) to (iv) below—
1. (i) any Minister of the Crown, Government department or other emanation of the Crown;
2. (ii) any local authority;
3. (iii) any metropolitan county passenger transport authority; and
4. (iv) any body corporate whose members are appointed by a Minister of the Crown, a Government department, a local authority or a metropolitan county passenger transport authority or a body corporate whose members are so appointed;
2. (b) in which the majority of the voting rights are held by or on behalf of any of the bodies or persons in paragraph (a) above;
3. (c) a majority of whose board of directors can be appointed or removed by any of the bodies or persons in paragraph (a) above:
4. (d) in which the majority of the voting rights are controlled by any of the bodies or persons in paragraph (a) above, pursuant to an agreement with other persons; or
5. (e) a subsidiary of a company falling within paragraph (a) to (d) above.

(3) The public interest company may borrow money for investing in transport in Greater London.")

The noble Lord said: It is a matter of some regret that we reach this amendment, which in many ways forms the centrepiece of our opposition to this part of the Bill, at this late hour. I hope that the Committee will forgive me if I deal in detail with the nature of the public interest company proposed as part of this amendment.

As the LSE report by Stephen Glaister, Rosemary Scanlon and Tony Travers stated back in March when the Bill was passing through the other place, the Government's plan for a PPP for the Underground is flawed in principle and impractical. That is even clearer now than when those words were written. The PPP for London Underground is a scheme that will have consequences for a long time—at least 30 years. Yet, as the authors said: The PPP threatens to impose burdensome long-term pressures on Underground operating revenues, including the prospect of continually rising fares, in order to pay back upfront investment by private contractors". What is more, we are being asked to buy the PPP as a solution without even being given the information on which to evaluate it. Members of neither House have been given access to the information on which government projections are based. Government assumptions about fare levels appear to be very fluid. I have made reference to some of the statements in the other place by the Minister for Transport in London. I have also mentioned the estimates made by Chantrey Vellacott, the veracity of whose report we could debate.

The PPP itself is a strange sandwich comprising the asset owner—Transport for London—in the public sector, the three infrastructure companies in the private sector and the operating company in the public sector. This is a recipe for confusion. The reason for the separation of infrastructure from operation in the case of the privatisation of the railways was to encourage competition, yet in the case of the Underground there are no proposals for competition over the tracks. Therefore, the economic case for separation makes no sense at all. All we know is that the costs of separation will be higher than the status quo. As outlined on many occasions by both my honourable colleagues in the other place and the distinguished authors of the LSE paper, there are far more preferable alternatives on hand.

The origins of the PPP solution seem to lie with the Treasury's insistence on treating borrowing by Transport for London for capital investment in the Underground as part of the PSBR However, as I mentioned earlier in Committee, for the Channel Tunnel Rail Link's revised financing structure the Government agreed to the issue of guaranteed bonds. That did not count against the PSBR because the Deputy Prime Minister said that the chances of a call being made on the guarantee were less than 20 per cent.

The Treasury has also agreed that borrowing by several of the regional airports will not count towards the PSBR. If the Treasury cannot relax its rules, however, the alternative consistently supported by Liberal Democrats, both in another place and on these Benches, is that of a public interest company. That has been described by the LSE as the "fourth way" approach. Clearly, that alternative is a preferable approach for long-term financing of the Underground. It includes the following components: the issue of long-term bonds secured by dedicated revenues, such as congestion charges and fees; an agreed level of government grant, such as the one agreed for the train-operating companies; and a realistic and agreed level of operating profit.

Earlier in Committee the Minister admitted that a separate company structure for the regional airports had advantages. We agree. Instead of the clear logic and cost effectiveness of these proposals, we have the sight of the Deputy Prime Minister desperately trying to make the unworkable work. The price of this will be too high for the London Underground traveller and the taxpayer. We will be bearing the consequences of it for the next 30 years. The way in which the New York Metropolitan Transportation Authority (MTA) was financially restructured in the early 1980s, when the MTA was able to issue its own bonds directly to the capital markets, offers an example of possible success for London in this way.

Furthermore, the way that these arrangements are being set up is deliberately designed to minimise any influence of the incoming mayor over the creation of the scheme, the identity of the PPP companies, the assumptions which underlie the economics involved in their operation, or the performance targets to be set. Yet the mayor will carry the ultimate responsibility for the success or failure of Transport for London as a whole.

The proposed PPP will actually make a mockery of the new mayor's position. For the first year or more of the GLA's existence, TfL will be responsible for almost all London's transport services except the London Underground, the most important element in the capital's transport system, the one most in need of improvement, and the one for which the mayor will receive more brickbats than anything else. If I was more cynical, I would think that the Government had deliberately planned this as a way of discrediting the new mayor as soon as he or she takes up office.

Two of the three major aims in the Government's White Paper were to deliver an integrated and sustainable transport strategy in London and to unify the presently fragmented responsibility for transport in London by creating a body that can tackle issues at London-wide level. PPP will certainly not fulfil these objectives for Transport for London. In the words of the LSE authors, At present there is a risk that the attempt to make the PPP work at any price will be both costly to the farepayer and the taxpayer and damaging to the new GLA".

The current amendment does not attempt to eliminate the PPP. It states that, if by July of next year the contracts are not let, this procedure will take place and a public interest company will take over the remaining parts of the network. We are, therefore, giving it a sporting chance, but we are also extremely pessimistic about the prospect of success. I beg to move.

Lord Brabazon of Tara

Very briefly, I agree with much of what the noble Lord has said about the likely effects of the PPP. In fact, I made many of the points that have just been made by the noble Lord during my Second Reading speech on the Bill. However, we do not agree with the noble Lord about what may provide the solution to this particular problem. We beg to differ on that matter.

Lord Whitty

I was glad to hear the noble Lord, Lord Clement-Jones, say that he was giving the PPP a sporting chance of success. Up until that point, he was not exactly supportive of that approach. I believe that the negative comments to the approach of PPP have perhaps undermined people's confidence in it. It has not, however, undermined our determination and belief that this is the best way forward for the London Underground and our determination to define and specify the terms of the PPP that we will offer both in relation to Railtrack and the other two contracts that we intend to award.

The Deputy Prime Minister made it clear as long ago as December last that he was committed to seeing the PPP negotiations through to completion. He has never hidden the fact that this means that the process is unlikely to be completed before TfL is vested in July 2000. That means that the deadline contained in the noble Lord's amendment cannot and will not be met. We have given no commitment that it will be met. It would be damaging to the PPP negotiating and tendering process if we tried to meet it.

I understand that people may have ideological and practical objections to the PPP process, but we believe that it is the best way of mobilising not only private capital into the London Underground but also a fair amount of private sector expertise and technology. That seems a sensible way forward while maintaining the overall public sector structure.

It is a new body. TfL is a new creature. But London Underground has not worked under the straightforward public sector provisions in the past; nor does the privatisation of British Rail give us any great comfort that the alternative of the noble Lord, Lord Brabazon, would be appropriate for the London Underground.

We are pursuing the matter. We shall take the time it takes to pursue it, which will almost certainly carry us beyond 1st July 2000. The noble Lord's alternative of establishing a public interest company at that date does not seem to us to meet the requirement either. The amendment prescribes a list of bodies or persons who are holding a majority of shares in a public interest company. The company is in effect a subsidiary of TfL, with some wider public sector involvement. A public interest company, therefore, again falls into the local government finance regime. That is exactly what the noble Lord does not like.

I explained at a much earlier hour that I do not believe that to be as great a constraint as do the noble Lord and his colleagues. TfL will be able to borrow money to invest in transport because it will be a local authority for financial purposes. It will also be subject to the local authority financial regime, as also would this body, which in effect would be a subsidiary of TfL.

I do not see that the amendment provides a better way than PPP to raise money which we could not otherwise tap into. Indeed, all it would do would be further to blur the boundaries of what TfL is doing, as distinct from the London Underground.

I believe that there is considerable scope for the PPP to work. Putting it in its kindest way, the constant sniping from various areas of the political spectrum against the PPP has not helped. But our determination to deliver it remains. We believe that it is the best way forward for London transport and for a positive contribution for London Underground to an integrated transport system. I do not expect that I have convinced the noble Lord. But I hope that at this hour of the night he will not pursue his amendment.

12.30 a.m.

Lord Clement-Jones

I thank the Minister for that considered and upbeat reply. I am not alone in my lack of faith in the PPP, as the Minister pointed out. I note that he spotted that I was not giving such a sporting chance to the PPP. On these Benches we have a fundamental difference of view about the workability of the PPP, the desirability of Treasury rules, and so on. We are only sorry that the department was unable to take a closer look at other models. I have mentioned New York. Chicago is another model where authorities are able to borrow on the market. Because of the structure and composition of their company in the public sector they are able to be more flexible about the way they operate. That is what the amendment was designed to provide. We shall continue to disagree on that. We may wish to have a further discussion at later stages of the Bill. In the meantime, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clauses 168 to 176 agreed to.

Schedules 10 and 11 agreed to.

Clauses 177 to 180 agreed to.

Clause 181 [The PPP arbiter]:

Baroness Farrington of Ribbleton moved Amendment No. 280A: Page 97, line 5, leave out ("Act") and insert ("Chapter")

These amendments make minor technical changes to the existing provisions for a statutory arbiter. Amendments Nos. 280A and 283C provide a definition of the PPP arbiter in the chapter. Amendments Nos. 283A and 283B relate to the requirement to provide information to the PPP arbiter. Amendment No. 283A adds a definition of a related third party agreement, to make clear that parties to such agreements are covered by the requirements to provide information. Amendment No. 283B adds a reference that a person may refuse to answer any question as well as to provide any information which he would be entitled to refuse to provide for the purposes of court proceedings. I beg to move.

On Question, amendment agreed to.

[Amendment No. 281 had been withdrawn from the Marshalled List.]

Lord Brabazon of Tara moved Amendment No. 281A: Page 97, line 8, at end insert— ("() For the avoidance of doubt, in discharging those functions the PPP arbiter shall be acting as an expert and not as an arbitrator under the Arbitration Acts.")

The noble Lord said: In moving Amendment No. 281A, I wish to speak at the same time to Amendments Nos. 282 and 283. We now begin the final furlong by moving onto the PPP arbiter. It is quite correct that the Bill as drafted requires a PPP arbiter to act as a third party referee on any disputes. Most significant construction contracts in the commercial world would have some form of expert umpire to resolve disputes. For the same reasons, the Bill should follow the precedent of normal commercial agreements. The procedure under the Bill is onerous and frequently excluded by commercial agreement in the private sector. PPP agreement should follow the same line. This amendment attempts to cure a lapse from normal business practice.

Turning to Amendment No. 282, it is quite correct that the Bill as drafted requires the PPP arbiter to act as a third party referee in any disputes. As I said, most significant construction contracts in the contract world would have some form of expert umpire to resolve disputes.

It is, furthermore, extremely helpful that the Bill sets out the principles on which the PPP arbiter is to act, so that everyone has some idea of where he stands. However, as drafted, the principles allow an escape clause should any relevant body—that is, LRT or TfL or any of their subsidiaries—mismanage its resources to the extent that it can no longer perform its side of any PPP agreement, as the PPP arbiter is to "have regard to the resources available to any relevant body" without specifying when they are to be available. While it is right that TfL should not be taken to have contracted to deliver something which is beyond its means, private sector operators need the security of knowing that, if TfL contracts to provide something, it will be held to it and not allowed to wriggle out of its agreements if it subsequently mismanages its funds.

Turning to the last amendment, Amendment No. 283, again it is quite correct that the Bill as drafted requires a PPP arbiter to act as a third party referee in any disputes. It is, furthermore, extremely helpful that the Bill sets out the principles on which the PPP arbiter is to act, so that everyone has some idea of where they stand. However, as drafted, the Bill is unclear as to what should happen in the event that these principles clash. This places the PPP arbiter in an invidious position. The amendment cures a defect in the Bill by stating which principle takes priority. I beg to move.

Baroness Farrington of Ribbleton

Amendment No. 281A purports to clarify the role of the arbiter. The definition is set out in the Arbitration Act. The Government have made it clear that the arbiter will not just be an expert who will give technical judgments, nor will he arbitrate in disputes between the parties. He will determine questions and issues put to him while having regard to his statutory duties. We believe that the provisions in Clauses 181 to 187 adequately define this role. As the noble Lord will be aware, the reference to the relevant body in this clause refers to the public sector body—that is, TfL—rather than the PPP contractors.

Amendment No. 282 would require the arbiter to disregard the level of resources available to TfL and so have the effect of placing restrictions on the way in which TfL allocates its budget, which is not acceptable or desirable. The performance levels required under PPP agreements need to be set against what TfL can afford.

Amendment No. 283 seeks to require the arbiter to make efficiency and economy his key priority when making a direction or issuing guidance. Subsections (2) to (5) of the clause clearly define the objectives set out to the arbiter of which subsection (3) deals specifically with efficiency and economy. We are of the view that there are no substantial benefits to be had from the objectives being ranked in a predefined order of importance. All parties will be best served by the objectives having equal considerations. I therefore ask the noble Lord to withdraw the amendment.

Lord Brabazon of Tara

I shall certainly withdraw the amendment. It was only a probing amendment and I shall read with interest what the noble Baroness said. In the meantime, I beg leave to withdraw it.

Amendment, by leave, withdrawn.

Clause 181, as amended, agreed to.

Clauses 182 to 185 agreed to.

Lord McIntosh of Haringey

I beg to move that the House do now resume.

Moved accordingly, and, on Question, Motion agreed to.

House resumed.