Railtrack (Hansard, 8 January 2002)

§ Lord Falconer of Thoroton
My Lords, it is for the administrator to put a proposal for a transfer scheme before my right honourable friend the Secretary of State based on any propositions he receives. The timetable for this process is a matter for the administrator. He shares the Government's view that it should be completed as quickly as possible.
It is in everyone's interest that at least one viable bid is submitted to the administrator for him to judge alongside any other serious bids that are made. To this end, a bid team has been established under the sponsorship of the Strategic Rail Authority to develop 443 a robust proposal for a company limited by guarantee. The bid team is up and running under the leadership of Mr Iain McAllister.

§ Lord Burnham
My Lords, I have no doubt that, the decision has indeed been delayed by the absence of the Minister's right honourable friend the Secretary of State. Are not the actions of his right honourable friend in robbing so many people of their savings both ill considered and, indeed, immoral? Does the noble and learned Lord consider that the fact that so many of the people affected are railway workers may well have had an effect on the current situation on the railways?

§ Lord Falconer of Thoroton
My Lords, "No" to the first part of the question. There was no such delay caused by the Secretary of State's holiday. "No" as regards the implication that the shareholders were "robbed". The placing of Railtrack into administration was a necessary and sensible act done in the interests of rail users; and "No" to the third part of the question.

§ Lord Bradshaw
My Lords, who is ensuring that the people maintaining the railway at present—that is, the contractors who are contracted to the administrator—are actually delivering any sort of value for money? We keep hearing about the need to spend large sums of money on the railway; we have no measure whatever of whether we are getting any return for taxpayers or railway users in terms of value.

§ Lord Falconer of Thoroton
My Lords, the responsibility for ensuring value for money on those contracts obviously lies with Railtrack. Railtrack is presently in the hands of the administrator. The administrator has appointed Mr John Armitt, who commands widespread respect as the chief executive. His job, among others, will be to ensure that the vital value for money to which the noble Lord refers is being obtained.

§ Baroness Sharples
My Lords, by what date does the noble and learned Lord expect a result in this situation? Can he say whether we shall have a solution in weeks or months?

§ Lord Falconer of Thoroton
My Lords, it will not be weeks. This matter will take a considerable time. I cannot say precisely how long it will take. It will involve a process of selecting a long-term future for what is currently Railtrack. I do not think it would be right simply to give an answer that would provide some spurious deadline when these matters take time—and it is right that they should.

§ Lord Faulkner of Worcester
My Lords, does the Minister agree that the successor company to Railtrack must pay proper heed to the network licence under which the original company operated; namely, that it operates safely, looks after its assets and pays due heed to the interests of its customers and its regulator? Is he aware that virtually every train 444 operating company, virtually every maintenance contractor, every passenger group and every other organisation that dealt with Railtrack felt that the contemptuous way in which that company dealt with them contributed enormously to its destruction and that many of its problems were self-inflicted?

§ Lord Falconer of Thoroton
My Lords, I agree with the first part of the question; namely, that those matters to which regard should be had are certainly matters to which those operating the track should have regard. As to the precise role of Railtrack in terms of contributing to its being placed into administration, I do not want to comment at the present time. The right thing to do is to look forward.

§ Viscount Astor
My Lords, does the noble and learned Lord remember that when the Secretary of State put Railtrack into administration he said that the process might take three to six months? It has now taken three months and we have heard from his department in the past few days that the process might take between nine months and a year. If that is the case, will the noble and learned Lord give the House an assurance? In order for the private sector to have an opportunity to bid, when will the Government announce what public sector funding will be available to the railway industry?

§ Lord Falconer of Thoroton
My Lords, as to the first part of the question regarding the timing, yes, I recall the remarks referred to by the noble Viscount. The time that these matters take is very difficult to estimate, and I believe that everyone in the House recognises that. I am quite sure that the right thing to do is to ensure that a proper period of time is taken in order to ensure that the correct answer is reached. Rushing into things may not necessarily be the right course in a situation such as this.
Secondly, so far as concerns the process, it is for the administrator to decide on the basic process to be adopted. It is for the administrator ultimately to come forward with a specific proposal on which the Secretary of State will then express his consent or riot. So far as concerns government funding in the future, to some extent that will depend on what proposals come forward.

Lord Berkeley
My Lords, will my noble and learned friend give the House an assurance that the organisation of Mr John Armitt—whom we all welcome as chief executive of Railtrack plc and whose job it is to keep the network going—is now completely separate from that of the Railtrack group headed by Mr Robinson and Mr Marshall—who appear to be continuing to plough their furrow to look after shareholders' interests, which at the moment is diametrically opposed to running the railway?

§ Lord Falconer of Thoroton
My Lords, Mr Armitt's job as chief executive is to run the Railtrack part of the business. It has nothing to do with the Railtrack 445 group, which owns various properties and has various property rights, and which is entirely separate from what Railtrack is doing.

§ Lord Pilkington of Oxenford
My Lords, is the Minister content, in view of the sad history of the past few months, that private money will be given to the new successor company?

§ Lord Falconer of Thoroton
My Lords, 1 am content that the arrangements that will be made will be such as to attract private money. As to what they are, that is a matter to be developed in the next few months.