Rail Fares and Station Parking Charges (Hansard, 24 July 2000)

§ The Minister of State, Department of the Environment, Transport and the Regions (Lord Macdonald of Tradeston)
My Lords, under the Railways Act 1993 the franchising director has powers to regulate rail fares. Key fares—approximately 40 per cent of fares—have been capped at 1 per cent below the rate of inflation. Her Majesty's Government are committed to increasing rail use by 50 per cent by 2010. We are looking to train operators to play their part by setting the price of unregulated fares and car parking charges accordingly.

§ Baroness Thomas of Walliswood
My Lords, I thank the Minister for that Answer. He has raised the question of unregulated fares. Is he aware that the fare from Liverpool to London has quadrupled since privatisation? Is he further aware that restrictions on when one can turn up and travel—supersavers, cheap day returns and so on—have been altered in such a way that they no longer suit many passengers? Does the Minister have any way of dealing with this problem, which offsets many of the advantages achieved in other parts of the rail network and the rail fares system? In particular, has he considered referring the issue to the competition authorities?

§ Lord Macdonald of Tradeston
My Lords, I should point out that 70 per cent of passenger journeys by rail are made with discounted fares. Since privatisation, in the four years from 1995–96 to 1998–99, the increase in standard class fares of 9 per cent was against an inflation rate in RPI of 9 per cent. Therefore there has been no real increase. Those figures take us until March of last year and will be updated in October of this year. We welcome the proposal of the Association of Train Operating Companies to band the 90 ticket types into six generic groupings to make the current fares structure easier to understand. We are talking to the Shadow Strategic Rail Authority about future fares regulation in the light of the current franchise replacement process.

§ Lord Borrie
My Lords, is my noble friend aware that at stations on the Hereford to Paddington line there has been an increase in car parking charges, a reduction of space and capacity for cars, and a universal refusal to install CCTV cameras, despite evidence of theft and vandalism at those stations—allegedly because there is not enough money to install them? Does the Minister agree that CCTV cameras at station car parks should be a standard service for the benefit of car owners?

§ Lord Macdonald of Tradeston
My Lords, unlike fares, there are no provisions in the franchising agreements in relation to car parking charges. The previous government instructed the franchising director to let franchises in a way which left maximum scope for initiative, with requirements no more burdensome than necessary. However, the franchising director is seeking improvements in many areas, 5 including asking operators to put additional security patrols on trains and in car parks, and to look at the provision of CCTV at stations and car parks.

§ Earl Russell
My Lords, is the Minister aware that the case for subsidised station car parks as a congenial and cost-effective way of relieving congestion has been made ever since the Buchanan report? Should we therefore conclude that this is one of those cases which is too sensible ever to get attention?

§ Lord Macdonald of Tradeston
My Lords, we are giving attention to the matter. Indeed, recently in the South West, a proposal from a train operating company to put up car parking charges encountered great local resistance and the charges were subsequently reduced.

Lord Berkeley
My Lords, does my noble friend agree that it should be a condition on the franchisee that car parking charges are not hiked by 60 per cent—as happened recently at Reading—and that car parks are not let out to local offices? Cannot those measures be incorporated in the new franchises?

§ Lord Macdonald of Tradeston
My Lords, we can certainly examine the issue. It is not proposed that the franchising director should regulate car parking charges directly under the provisions of the Transport Bill. However, it is expected that there will be reasonable commercial and contractual incentives on operators to keep car parking charges to a minimum. The importance of car parking has been confirmed by the SRA and others as a result of consultation with customers.

§ Lord Elton
My Lords, the whole point of the exercise is to get people to leave their cars at the station and then use a train. Would it not be sensible if the authorities made a regulation to deal with this matter rather than leaving it to the random effects of economic pressure?

§ Lord Macdonald of Tradeston
My Lords, we shall certainly discuss with the SRA whether it is worth overturning the considerations of the previous administration in this regard. I should also say to the noble Baroness who tabled the Question that we are looking to the rail regulator to keep his eye on rail fares as regards competition.

§ Lord Marsh
My Lords, if the Minister and the Government want to administer the detail of railway operation, would not the sensible, effective and moral way of doing so be to renationalise it?

§ Lord Macdonald of Tradeston
My Lords, after years of rail fragmentation and confusion which are only now coming to an end, it would be very unwise to go into another extended period of dislocation—especially when we are on the verge of investing 6 £60 billion in the railways, which I hope will open up a new era of expansion and increase by 50 per cent the number of people travelling on the railways by 2010.

§ Lord Peston
My Lords, I did not fully understand my noble friend's answer in connection with the competition authorities. Did he say that the competition authorities have no locus with regard to the setting of prices for railway journeys and no locus in regard to dealing with car parks, which in most cases are a monopoly? Is he saying that somehow the legislation was devised so that the competition authorities cannot deal with this subject?

§ Lord Macdonald of Tradeston
No, my Lords. I am saying that the Rail Regulator is the competent authority concurrent with the Director General of Fair Trading to enforce the provisions of the Competition Act in respect of rail fares. I was also saying, perhaps not clearly enough, that the regulator has received a number of complaints from the public and from Members of Parliament concerning recent fare increases. He takes the matter very seriously in considering whether to take any further action under the Competition Act.

§ Lord Brabazon of Tara
My Lords, did I hear the Minister just now say that "we" are in the process of investing £60 billion in the railways? Do I assume that by "we" he means the Government? Can he say how much of that money is government money and how much of it is private sector money?

§ Lord Macdonald of Tradeston
My Lords, I said "we" in the context of the partnerships about which the Government are extremely enthusiastic. I should confirm that we will be putting in £15 billion of public investment through the 10-year plan, £11 billion of public resource revenue investment, and we shall look to the private sector to come forward with investment of £34 billion.

§ Lord Faulkner of Worcester
My Lords, is my noble friend aware that on previous occasions when the railways have faced significant increases in demand the reaction of the government of the day—of both parties—was to encourage the industry to choke off demand by putting up prices well above the rate of inflation? Can we be sure that, with the 10-year plan and the very welcome commitment to the 50 per cent increase in passenger usage, the rail companies will not be allowed to rip off the customers and will be required to invest in new facilities and new capacity?

§ Lord Macdonald of Tradeston
My Lords, we will certainly not encourage any traditional habits of pricing customers off the railway in that way. In fact the RPI-1 formula is in place for the next three years. I should also remind noble Lords that since 1974 real income has increased by 185 per cent, whereas the cost of travelling by rail has increased up by 150 per cent. However, the total cost of travelling by car has remained at 100 per cent. So we wish to make rail and indeed bus travel more competitive against car travel.