§ Mr. Gerald BowdenTo ask the Secretary of State for Transport (1) whether he will take steps to ensure that British Rail assess all new investment schemes for external benefits which would attract funding by Government grant;
(2) whether any of the approved investment by British Rail will be met by Government grant in recognition of benefits to the users of improved services.
§ Mr. FreemanInterCity no longer receives subsidy from the taxpayer. Its investment programme and that for channel tunnel services will be determined by normal commercial criteria.
As far as provincial and Network SouthEast are concerned, there is no case for subsidy for investment for which passengers are willing to pay and which meets the normal financial criteria. However, the new objectives for British Rail set out in my right hon. Friend's letter of 19 December to the chairman make it clear that where investment to increase the capacity of the system cannot meet the normal financial criteria, a cost-benefit analysis should be carried out so that a decision can be taken on whether capital grants would be justified on wider social and economic grounds, such as relief of road congestion. The majority of the provincial sector's investment is like for like renewal which is not required to earn any return and is effectively met from revenue grant.