Transport Investment Plan

HL Deb 17 December 2002 vol 642 cc588-99

6.17 p.m.

Lord McIntosh of Haringey

My Lords, with the leave of the House, I shall now repeat a Statement that has been made in another place by the Secretary of State for Transport. The Statement is as follows:

"With permission, Mr Speaker, I should like to make a Statement on transport investment.

"Today, I am publishing a report on progress since April 2001 on the delivery of the 10-year investment plan for transport. This investment plan commits the Government to spending over £180 billion—both public and private investment—over a 10-year period. It is an unprecedented commitment, providing stability and increasing spending over the long term. And maintaining that investment year on year is essential to make up for decades of under-investment and neglect.

"Over the 10-year period, this means public expenditure of over £22 billion on strategic roads; £33 billion on the railways and £51 billion on local transport. The plan is the first time ever that a Government have been willing to commit themselves to such a level of funding over a long period. And that funding is making and will continue to make a difference.

"If you look at other countries successes in transport the common factor is sustained investment, year on year and decade after decade. That is why we remain committed to updating and rolling forward the plan in 2004 to coincide with the next public expenditure review. And that review will take account of progress so far and challenges that will have to be met in the years to 2015 and beyond. Such long-term commitment and planning is essential if we are to rebuild and maintain the transport infrastructure we need for continued growth and prosperity.

"This report sets out what has been achieved in the first 18 months since the plan came into effect. As I told the House last week, our objective is to improve Britain's rail and road network. It is a balanced approach, with investment to tackle congestion, improve reliability and make journeys safer. And to do so in a way that is consistent with our wider social and environmental obligations.

"I want to set out some of the key points. Last week, I announced major investment designed to tackle congestion and improve journey times. Schemes will range from major enhancements on some of our key strategic routes, for example the M1 and M6, as well as bypasses and smaller schemes to tackle bottlenecks. We have also introduced measures to better manage existing roads, I also announced further investment in local transport and light rail.

"As the report makes clear, the latest analysis shows that there was more traffic in 2000 than had been thought. That, coupled with the fact that economic growth over the next 10 years is now projected to be higher than anticipated, means that the forecasts made two years ago almost certainly underestimated the future levels of congestion we are faced with.

"Without the investment in the 10-year plan, congestion would have continued to rise unchecked. The report shows that not only will we stem that growth, but deliver considerable reductions in the levels of congestion we would otherwise have seen. In order to tackle congestion, it is necessary to tackle its causes. That is why we are spending more to deal with bottlenecks on the roads system and spending more on public transport.

"Measures to tackle congestion are beginning to make an impact. Bus use nationally has begun to grow after years of decline and stagnation. Light rail use has grown by a third over the past two years. The number of rail passengers has increased by nearly a quarter since 1997.

"We need to do more. All this will only be possible because of the commitment to sustained investment year-on-year, and I shall be announcing further measures next year. The House will also wish to know that there has been a 15 per cent reduction in deaths and serious accidents on the roads And for children, there has been a 27 per cent reduction, which is a tribute to all those who have done so much to improve road safety.

"On the railways, public expenditure is now estimated to be £33 billion compared to £29 billion 18 months ago. We are committed to sustaining this investment as it is essential to improve both reliability and safety. But it is also essential that the industry gets a grip of major projects. The public rightly expect us to ensure that their money is well spent and that there is rigorous control of costs.

"Spending in the next few years will rise from £2.1 billion in 2001–02 to £4.3 billion in 2005–06, which, although £312 million less for the Strategic Rail Authority over the coining three years than was forecast earlier this year, is double what was being spent at the start of the plan. This investment will only deliver results if costs in the industry are brought under control. That is why Richard Bowker, the Chairman of the SRA, is quite right to insist that the railways industry gets a proper grip on its costs—something that was conspicuously absent in the past.

"As I have said, the report shows that the railways are carrying nearly a quarter more people than 5 years ago. But we will only sustain that increase in use if we can show that the service is better and, crucially, more reliable. That needs more investment, but also better management of the existing network, which is what the SRA is providing. That is why the SRA is carrying out a review to make sure that the best use is made of existing railway capacity, that projects are more tightly managed and that costs are driven down.

"As the report shows, there is now significant public investment going into the West Coast Main Line which will allow greater reliability. But only because the SRA and the industry showed its determination to exercise rigorous control of the project and its costs.

"Progress is being made elsewhere too. There has been sustained investment year on year—over I billion worth of new rolling stock has been introduced since April 2001 with a further 2,100 vehicles on order. Ninety per cent of the first phase of the new Channel Tunnel rail link is now complete—the first major new rail line for over 100 years. There has been the installation of a new safety system—the train protection warning system—on around 70 per cent of the track and around 90 per cent of the passenger fleet. The power supply for London commuter trains has been upgraded. There has been more maintenance and more renewals.

"There has been investment, yes. But, just as elsewhere, with investment must come reform. Every one of us knows that standards on our railways can be improved. This report shows that we are prepared to spend more, but in return the railway industry has to do far more to drive up standards and reliability. Our priority is to deliver safe and reliable transport that enables people and goods to move around the country as easily and efficiently as possible.

"This plan sets out the investment to achieve that over a 10-year period. There are no quick fixes or easy solutions. Sustained investment is needed year on year and over many decades. We are committed to the long haul, to that sustained investment and improvements in services essential to our continued economic and social prosperity".

My Lords, that concludes the Statement.

6.24 p.m.

Viscount Astor

My Lords, I thank the noble Lord for repeating the Statement. The report is called the "progress report". I have had a brief look at it and I have to say that perhaps it should be called the "lack of progress report". It represents the final nail in the coffin of John Prescott's 10-year transport plan. That plan is falling apart. Congestion is increasing; one in five trains is delayed; the Tube is in chaos and nationally bus use is falling. Even the Labour-dominated Transport Select Committee has condemned the plan as failing to provide a vision for a more equitable, safer and efficient transport system.

A recent survey comparing us with Europe noted that the average British worker spends twice as long travelling to work in the morning as even his Italian counterpart. In the South East, we are faced with rail fare rises of up to 10 per cent. There will also be fewer trains. The excuse made by the Government and the Secretary of State is that having fewer trains might be more reliable. At the moment, we have a thoroughly illogical system. How can we possibly have a situation where Connex is fined £4.5 million one week for delays, and the following week is handed back £58 million because it is short of cash? That is extraordinary.

I hope that the Government will persuade the Strategic Rail Authority to look at the terms on which the train operating companies have their licences renewed because the basis of making the licences short term is obviously having a major effect on the plans of those companies. Train operating companies have been a successful part of rail privatisation. The noble Lord knows—indeed, the Statement says—that passenger use has increased by 25 per cent since 1997.

Efforts to cut congestion on the roads have failed miserably. The Government cancelled a large part of the road improvement plan that they inherited, with the result that we have chaos in transport. We know that train services could be cut by up to one-fifth next year and that train operating companies have been told to produce plans to run railways on 20 per cent less taxpayer subsidy. Richard Bowker, the Chairman of the SRA, has warned that the £33 billion promised over 10 years is running out and that expansion projects will have to be put on hold. He has admitted that many projects will have to be scaled back.

To cap it all, the Government have announced an airports policy which will have to go back to square one. They lost a case in the High Court, in which the judge decided that it would be wrong to exclude Gatwick from the airport expansion consultation.

Costs in the rail network have soared. Indeed, more money is being pumped into the industry now than under British Rail, but in many areas performance has deteriorated.

The Government promised that they would tackle congestion and improve journey times for motorists. In fact, statistics show that car use has increased and that congestion has worsened. What is more, congestion has risen at a substantially higher rate—probably 10 times higher—than the rise in employment in this country. Highways Agency figures show that not one inch of new bypass was built anywhere in 2001. The Government cancelled bypass programmes when they came into power.

Turning to London Underground, the PPP has still not started this month and the Secretary of State has said that the transfer of London Underground to Transport for London could be delayed by many months.

The Minister's department comes up with surprising excuses. Today, I noticed that a spokesman cited the slow take-up by local authorities of the option of introducing congestion charges as one of the reasons for the continuing jams on major routes. I find that extraordinary. Perhaps the noble Lord will confirm that that is the department's policy. The introduction of congestion charges might affect congestion in cities. but the idea that it affects major routes is rather bizarre.

The Statement reads: economic growth over the next 10 years is now projected to be higher than anticipated". I ask: anticipated from when? Perhaps the Minister could explain how that forecast came about.

The Government have made many promises, including another promise of funding for 10 years. However, we know that that is a plan, not a commitment. The dead hand of the Treasury hangs over that and it has no such thing as a 10-year commitment. It has only a short, two or three-year commitment.

I said that the report indicated a lack of progress, but it shows one thing. I commend the Secretary of State for having faced the reality of the congestion in this country and the report finally buries the 10-year plan. It is an admission that the department and the Secretary of State, Mr Darling, have finally joined the real world.

Lord Bradshaw

My Lords, I, too, thank the noble Lord for repeating the Statement made in another place. I am pleased to see the emphasis on getting value for money which is mentioned in the Statement. We should not measure success by the amount of money that is spent but on what that money buys.

My comments are made in both anger and sorrow. I was bitterly opposed to the privatisation of the railways. But we lost that argument and I would describe what we now have as the Treasury or extreme free-market model. That is why when Railtrack was privatised Liberal Democrats said that we would take back a controlling interest in the company. And so did the Labour Party, but it did not fulfil that promise. The company, its consultants and its contractors ripped off—the Government have used that phrase—the public and the taxpayers, which culminated in the catastrophe at Hatfield and all that followed from it. There was an easily foreseen demise of that monstrous company.

Since privatisation, infrastructure costs and delays have exploded and standards have fallen. The number of lawyers and accountants has multiplied, which has been matched by the demise of most of the operators and engineers in the business, who were much cheaper. What have the Government done? They have appointed a regulator, Tom Winsor, but he has failed to regulate at huge cost. The Strategic Rail Authority was created and it has an enormous number of staff—and consultants. There is a Commission for Integrated Transport, which the Government have studiously ignored. How much does the SRA cost?

When money for the railways runs out, why is it always the passengers who must suffer? Fares are increased faster than inflation and services, which are already unpunctual and inferior on much of the system, deteriorate. If the Minister were to visit north-east England and see the rotten trains which run around Leeds, lie would consider them unacceptable in London. They are almost Victorian in their antiquity.

If one keeps a shop, an important lesson to learn is that one should be open for business even at the expense of the backroom staff. On our railways, it seems as though lawyers, accountants, consultants, maintenance contractors and bureaucrats flourish, while the money to run the trains runs out. Why is the axe not taken to the legions of people who do not run the trains? Is there any plan to reduce the costs of those people, or do we have to wait for the forthcoming regulatory review of traffic charges?

Our fares are already the highest in western Europe. The contractual matrix of our railways is immensely complicated and expensive. Yet are there no plans to simplify it? We need fewer, simple, vertically integrated franchises which will be renewed if performance is satisfactory. I have repeatedly stated that we do not need a rail regulator. Safety regulation is overblown and unprofessional. Why are we still waiting for the Hatfield and Potters Bar accident reports?

We have replaced a small team of professional regulators—the former military people who formed Her Majesty's Railway Inspectorate—with an army of unaccountable bureaucrats, whether they are supervising their own standards, railway standards or Railtrack's standards. And I remind the Minister that Railtrack has 4,000 standards. An enormous number of people are needed to service the company, and that does not run the railway—it actually stops it running.

I want to ask the Minister one further question. The Statement mentions the bus industry. The bus industry outside London is not growing; only by adding in London figures does one see a growth. Will the Minister please tell us, or perhaps he would care to write to me if he does not know, when we can expect to see bus lane enforcement by cameras extended beyond London? I have been promised that in Written Answers—the phrases vary—later in the year, in the autumn and at the end of the year, but we are getting perilously near to the point when a reply is due.

Lord Cobbold

My Lords, perhaps I may—

Lord McIntosh of Haringey

My Lords, no, I must first reply to the Front Benchers. I would rather not, given the qualified rapture with which the Statement was received. But I want to make it clear what the Statement amounts to.

When asked Questions about progress on the 10-year plan, I have said in this House on a number of occasions in recent months that 18 months from the beginning of the plan was too early to make considered judgments. I still take that view. However, there was substantial pressure from another place, from the Transport Select Committee and from the Benches opposite to hear a progress report.

That report is a good deal more detailed and people have not had time to read it, let alone to respond to it. I do not blame noble Lords opposite for that. However, there were two particular reasons for making such a Statement. The first reason was the recognition—I make the acknowledgement to the noble Viscount, Lord Astor, and the noble Lord, Lord Bradshaw—that our targets for dealing with congestion were not being achieved. The Statement makes it clear that the figures we had when the 10-year plan was first produced under-estimated the level of congestion at that time. Subsequent figures have confirmed that and therefore that our targets were much more difficult to achieve.

As a result, we have had to look again at our targets for congestion. We can say that without the 10-year plan congestion would increase considerably more than we intend and expect it to increase with the plan. That is not to say that we will be cutting congestion on all our roads. Congestion is a feature of a country such as ours which is densely populated and is intensely metropolitan in the sense that a large proportion of people live in and around the capital city. That is a fact of life.

When we look again at our congestion targets, it is true to say that we have had more success in the economy than we expected. Gross domestic product has risen faster, as has in particular household disposable income. As a result, car ownership has risen faster than was expected. Congestion is the bad result of successful economic policies in that sense. That was one reason why it was thought appropriate to report to Parliament at such an early stage in the 10-year plan.

The second reason was the huge upheaval which was forced to take place on the railways. With the failure of Railtrack, which the noble Lord, Lord Bradshaw, so graphically described, it was clear that something had to be done. The administration for Railtrack and the creation of Network Rail is what had to be done. The work that is being done now by the SRA and by Richard Bowker, the chairman, in getting a grip on the cost of rail investment is another good reason for reporting to Parliament.

Mr Bowker has not attempted to mince his words. He said that if things go on as they are and there is no more effective cost control than we have, then certainly some of the projects in the programme will be unaffordable. However, he is determined, as we are, that we should get a grip on costs. The intention of today's statement is to make it clear that our commitment to investment in railways, roads, and local public transport is undimmed as a result of either of these matters.

It has to be recognised that Hatfield caused huge disruption on the railway and enormous extra expense in bringing the rail system up to anywhere near an acceptable standard. It was clear that it was not of such a standard. We therefore volunteered to lay these not particularly welcome facts before Parliament; it was, I believe, the right thing to do. It is not the case, however, that we are making a final judgment on all the aspects of the 10-year plan. I have schedules in front of me of all of the targets in the plan and how far we are achieving them. There are many examples of successful progress towards that plan. The Statement includes, for example, figures on road safety, on deaths and serious injuries on the roads, where we are on target to meet the plan. The time for that will be in 2004 when we have a proper opportunity to consider a substantial part of the plan and to roll the plan forward for a new 10-year period. That is the time at which the judgment of Parliament and the country will be due.

I do not know some of the specific answers—for example, on bus lane enforcement. Clearly, the noble Lord, Lord Bradshaw, is right that bus use is not growing outside London. Accident reports are a matter for those independent bodies from whom we have commissioned them. We cannot control their timetable.

I hope, from what the noble Lord, Lord Bradshaw, is saying and from what he said about privatisation, that he is supportive of what we have done in setting up Network Rail. From his previous comments, I believe that he is.

The noble Viscount, Lord Astor, is right in saying that our travel-to-work times are very long. That is partly because we are a metropolitan country, unlike Germany or Italy for example. In France, which is also metropolitan, the investment made over decades is certainly showing results.

The licence renewal decisions have been taken in the light of the serious risk of disruption that would have taken place if there had been an early ending of licence. Those decisions are taken on very strict conditions.

I am not clear in my note about what the noble Lord said about the airport documents. I shall have to read what he said and write to him about it. I have already responded to the question on congestion charges, and I believe that I have responded realistically and honestly.

6.44 p.m.

Lord Jones

My Lords, does the Minister know that for a generation the people of Wales have felt an absence of fair play over investment in the railway system? Does he believe that the Statement presages substantial investment in the Holyhead-Crewe-London Euston line? Is he able to say whether the Virgin West Coast Main Line rolling stock, the Pendolino trains, will be dedicated to that route? If he cannot provide a specific amount of the £34 billion earmarked for rail investment in Wales, will he to write to me with such a sum?

Lord McIntosh of Haringey

My Lords, I am afraid that I shall have to write to my noble friend. That is not a matter covered in the progress report.

Lord Cobbold

My Lords, I too thank the Minister for repeating the Statement. I certainly welcome the good intentions of the Government to reduce congestion and to improve the road system. The list of projects in the report is formidable but I am sure that, for each project in the plan, all noble Lords will have three or four schemes that are not in the plan.

I ask the Minister one question. Have the Government ever seriously considered an outer ring road round London, perhaps as a toll road, to relieve the congested and often gridlocked M25 and, if not, why not?

Lord McIntosh of Haringey

My Lords, not to my knowledge. I do not think this or any preceding government have considered that. The noble Lord, Lord Cobbold, will know that substantial expenditure on the M25 is included in the 10-year programme.

Lord Monro of Langholm

My Lords, may I press the Minister harder on the West Coast Main Line on which many of us commute every week? When shall we see the investment to complete the upgrading of the track and when can we expect some new rolling stock between London and Scotland?

Secondly, will he bear in mind that the main artery by road from London to Scotland is the M6? Only six miles of that route, between Carlisle and the Scottish border, is not motorway. When can we expect that to be upgraded to motorway standard?

Lord McIntosh of Haringey

My Lords, the noble Lord will know that we took a decision on the West Coast Main Line which attracted a good deal of flak: that, rather than rely on weekend and night working throughout the upgrading of the line, we would face the unpopularity of closing part of the line for periods of several weeks, starting next year. That certainly will speed up what had been unacceptably slow progress.

I think it would be unwise for me to go further than the information which is already in the progress report about completion dates, but they will certainly come about quicker than would have been the case.

There is no information that I can immediately find relating to the M6. I shall have to write to the noble Lord.

Lord Clinton-Davis

My Lords, does my noble friend agree that, with the best will in the world, the Conservative Opposition have not advanced one constructive argument for a coherent transport policy? Does he not agree that all modes of transport have to conform to such a policy?

Does he also agree that the Statement did not deal with air transport? Is it not internationally unacceptable that post-11th September—and I speak here as the president of BALPA—allies of the United States have been given huge subsidies by the United States Government? Does that not give them unacceptable advantages so far as European traffic is concerned? What are the Government doing about that?

Lord McIntosh of Haringey

My Lords, before I reply to my noble friend Lord Clinton-Davis, I have the information to answer the question of the noble Lord, Lord Monro, in regard to the M6. I believe that he is referring to the Carlisle-to-Guardsmill section.

Lord Monro of Langholm

My Lords, yes.

Lord McIntosh of Haringey

My Lords, the expected delivery date is 2007–08.

Turning to reply to my noble friend Lord Clinton-Davis, the question of our negotiations with the United States Government and their aviation authorities is not covered in the progress report. The only aspects of air transport covered in the progress report are air traffic control, airport policy and airport improvements. I can assure my noble friend that the issues he raised are being covered in the ongoing discussions we are having with the American authorities.

Lord Faulkner of Worcester

My Lords, does my noble friend accept that building more roads and widening existing ones will simply add to congestion unless these measures are accompanied by road pricing and traffic congestion measures? Is not the lesson we have learnt from previous road-building practices that it takes only about one year for new capacity to be entirely used up by new traffic?

As to the railways, is my noble friend aware that yesterday Virgin ran its first passenger train with the Pendolino stock from London to Manchester, completing the journey in two hours and nine minutes in one direction and two hours and six minutes in the other? I should declare an interest in that I was an invited guest on the train. Does my noble friend agree that this is undoubtedly an indication that at last the problems of the West Coast Main Line are being addressed and that there is hope that passengers will get the improved services to which my noble friend Lord Jones and the noble Lord, Lord Monro, referred?

Does my noble friend also accept that the commitment to better value for money and greater reliability that the Secretary of State has shown in his Statement today is shared entirely by Mr Bowker, the chairman of the Strategic Rail Authority? Can my noble friend confirm that when the SRA delivers its case for rail in 2004, the arguments it is likely to contain about the industry's long-term needs for investment will be sympathetically considered in the light of the 2004 spending review?

Lord McIntosh of Haringey

My Lords, all kinds of wild statements have been made about the supposed shift from rail to road in the Government's policies. The figures given in the Statement, and certainly those in the report, make it clear that we are not in any sense returning to the policy of predict and provide that my noble friend Lord Faulkner is rightly attacking. We recognise that there are certain pinch points which cause exceptional congestion and which can be tack led by judicious road provision, but this is not the U-turn described in the press.

I have been too busy reading government papers to look at the newspapers and I did not know about the Pendolino train runs. I am glad to hear it. I can certainly confirm that it is Mr Bowker's intention, with the Government's support, to gain control over costs in investment in the railways. Without in any way seeking to anticipate the 2004 spending review, it is quite clear that his success in doing so will determine how much will be achieved from investment in railways from 2004 onwards.

Lord Berkeley

My Lords, my noble friend the Minister mentioned road congestion several times, as did my noble friend Lord Faulkner. Has the time not come to start looking at urban road charging as a means of reducing congestion? My noble friend announced the building of some new roads, which will be welcome to many people, but I am sure that he will agree that the congestion figures will go up and up. Is it not time at least to start looking at introducing inter-urban road charges as a means of restraining the unfettered growth that might otherwise occur?

My second question relates to rail and freight. I declare an interest as chairman of the Rail Freight Group. The Statement did not mention any kind of freight. Freight operators are concerned about road congestion and the working time directive, which would indicate that they are quite keen to transfer freight to rail. My noble friend did not mention the targets in the original 10-year plan for a growth of 50 per cent in rail passenger numbers and 80 per cent in rail freight volumes. Are the Government still sticking to these targets? If not, what are the new targets?

Lord McIntosh of Haringey

My Lords, inter-city road charging is not a matter for the progress report. I am not saying that that issue will be ruled out from consideration when we come to the full review of the 10-year plan in 2004, but clearly it is a policy matter which has not been included in what is essentially a factual progress report of what has happened in the past 18 months.

As to the rail freight targets, we believe that it should be possible to increase the market share to 10 per cent by 2010 from 7 per cent now—which is indeed, as my noble friend Lord Berkeley said, an 80 per cent increase in rail freight—provided that the rail freight companies can deliver improvements in performance and efficiency. There has already been a 7 per cent increase in 2001–02 compared with 2000–01.

Lord Lea of Crondall

My Lords, is my noble friend aware that some noble Lords feel that it has been a valuable exercise to have a progress report on the 10-year plan? Indeed, it demonstrates the importance of the bi-partisan support three years ago for the 10-year plan. Clearly events change the context in which a 10-year plan has to be rolled forward, but we are now in the position where, against this framework, we can see some of the things that have gone right and some of the things that have gone wrong. If we had not had a 10-year plan we would be floundering around not quite knowing which way we were going. The 10-year plan provides a benchmark against which we can see, for example, that we have got our inputs right but that our outputs are not necessarily right at the moment, and how we have to improve standards in rolling forward the 10-year plan.

Lord McIntosh of Haringey

My Lords, my noble friend is right to remind the House that the 10-year plan was introduced less than two years ago with all-party support. All parties therefore should be interested in ensuring that the 10-year plan succeeds, rather than the more negative response we heard from the noble Viscount, Lord Astor, today. This is very much an interim report which was called for because of specific circumstances. I am sure that what my noble friend Lord Lea said will be applicable to the review in 2004.