HL Deb 17 July 2000 vol 615 cc762-6

(".—(1) Any person may apply to the Authority for permission to construct or operate new railway facilities or new network installations and the Authority may grant such permission on such terms as it may consider appropriate.

(2) A permission granted under subsection (1) shall not obviate the need for the applicant to obtain the appropriate licence from the Regulator and such other permissions and consents that may be necessary for the purpose of constructing or operating such railway facility or network installation or to enter into any access contract that may be required in connection therewith.

(3) In the event of a dispute between the applicant and any relevant facility owner or installation owner as to the charges payable to such facility owner or installation owner under any access contract required, either person may refer the matter to the Regulator whose ruling as to such charges shall be binding on the applicant and the relevant facility owner or installation owner.").

The noble Earl said: This amendment is designed to allow any company that wishes to build new lines not provided by Railtrack to apply for permission to the Strategic Rail Authority or to the Secretary of State. That could allow micro-franchises to be set up to run local trains in rural or urban areas. It would also allow companies to build cheap rail lines for the transit of freight. I beg to move.

Lord Macdonald of Tradeston

This proposed new clause is—a splendid word for this time of night!—otiose. The authority does not have the standing to give permission to any person to construct or operate facilities. Depending on who the applicant is and what permitted development rights already exist, a person may have no need to gain permission from a public authority. If existing powers and rights are not sufficient, then procedures to gain those are already in place under the Transport and Works Act. Applications for orders under that Act are made to the Secretary of State for the Environment, Transport and the Regions. The authority can make its view known to the Secretary of State and may appear at any public inquiry.

The other provisions in the amendment are already incorporated in the Railways Act 1993. Section 6 of that Act requires the operator of a railway asset to have a licence or an exemption. Sections 17 and 18 cover the need for regulatory approval of contracts for access. The ruling of the regulator over access charges is already covered by Section 17 of the 1993 Act.

The new clause could not serve a useful purpose. There is already a well used procedure to allow persons to construct and use railway facilities. I hope that with that explanation the noble Earl will be able to withdraw his amendment.

Earl Attlee

I thank the Minister for his response. It is disappointing when the Minister does not support an amendment, but I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 250 agreed to.

Schedule 27 [Minor and consequential amendments about railways]:

Earl Attlee moved Amendment No. 367: Page 312, line 13, leave out paragraph 19.

The noble Earl said: I shall speak also to Amendments Nos. 368 to 370. Paragraph 19 appears innocuous but it gives the Secretary of State the power to grant exemptions from licences at any time, whereas under the 1993 Act such exemptions could be granted only when the Act came into force and were a tool in setting the system up. An ongoing power as proposed in the clause could be abused. The amendment would remove it.

Amendment No. 368 would delete sub-paragraph (3), which removes the obligation on the Secretary of State to publicise any exemption granted from Sections 17 and 18 of the 1993 Act to those persons to whom it applies. It is difficult to see the point of removing that requirement.

On Amendment No. 369, if a rail operator has been substantially prejudiced by a failure to comply with the procedural requirements on making a penalty order, Section 57(2) allows a court to impose a lesser monetary penalty rather than quash the order. A schedule defect should not always lead to the voiding of the substantive action. The court should be able to decide when the operator has been so severely prejudiced by the procedural defects that the penalty should not be allowed to stand and when the prejudice is not so severe and a reduction in the penalty is more appropriate.

Amendment No. 370 would restore the provisions in Section 80(6) of the 1993 Act that anyone failing to provide information as required under that section is guilty of an offence and liable to a fine. The Bill would weaken the regulatory system by deleting that provision. Why should it not be an offence to fail to provide information to the authority? We would support protection against improper disclosure by the authority for the person being required to provide information and compensation if it is improperly disclosed. However, we see no point in having a requirement to provide information if there is no sanction for anyone refusing to provide it. I beg to move.

Lord Macdonald of Tradeston

By revoking Section 7(10) of the Railways Act 1993 we are restoring to the Secretary of State the power to grant licence exemptions. That power originally ceased on the coming into force of Section 6 of the Railways Act. Under that power the Secretary of State made the Railways (Class and Miscellaneous Exemptions) Order 1994 which gave a broad range of licence exemptions.

While the rail regulator has the power to make exemptions, he does not have the power to make whole classes of exemptions. There may well be cases in the future in which class exemptions are appropriate. An important feature of the Secretary of State's power—as opposed to the regulator's—is that he must grant exemptions by way of an order made by statutory instrument subject to parliamentary scrutiny and a negative resolution procedure under the Railways Act 1993.

Amendment No. 368 would reinstate a requirement on the Secretary of State to publish facility exemptions. The publication requirement in Section 20 is being revoked because it is considered to be otiose.

When the Secretary of State makes an exemption, he does so by way of a statutory instrument. All public general statutory instruments must be published and sold under Section 2 of the Statutory Instruments Act 1946. That contrasts with the position when the regulator produces an exemption other than by way of a statutory instrument and where a specific duty to publish is necessary. So the removal of a Railways Act provision does not relieve the Secretary of State of the obligation to publish any exemptions which he makes. I hope that the Committee will be reassured by that.

Amendment No. 369 is unnecessary. Provisions relating to financial penalties are now wholly consolidated in new Sections 57A to 57F as introduced under Clause 224 of the Bill. The power of the court on appeal to substitute a lesser amount for a penalty imposed by the regulator or the SRA has been moved to Section 57F(4)(b) and the old power in Section 57(2)(b) is a necessary consequential repeal.

Amendment No. 370 would remove criminal liability for a failure to provide information to the SRA in response to a request. In the interests of better regulation we always look closely at whether it is appropriate to criminalise actions where there are other more appropriate sanctions. If a person fails to respond to a request by the SRA to provide it with information, the SRA can under Section 80(8) of the Railways Act ask a court to order the delivery of that information and if the person concerned refuses he could be penalised for being in contempt of court.

We consider this to be a more appropriate sanction than criminalisation. That should be kept (as it will be under Section 87(7)) to cases where the person may have deliberately falsified the information which is provided to the SRA. This is a gentle deregulatory measure, therefore, and does nothing to weaken the ability of the SRA to seek information that it needs under Section 80.

I hope that, with those explanations, the noble Earl will withdraw his amendment.

Earl Attlee

The word "deregulation" was magic to me. I look forward to reading the details of the Minister's reply in Hansard. With the usual caveat, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 368 to 370 not moved.]

Schedule 27 agreed to.

Clause 251 agreed to.

Schedule 28 [Transitionals and savings about railways]:

[Amendment No. 371 not moved.]

Schedule 28 agreed to.

Lord Carter

I beg to move that the House do now resume.

Moved accordingly, and, on Question, Motion agreed to.

House resumed.

House adjourned at twenty-two minutes before three o'clock.