§ Mr. Ronald Atkinsasked the Minister of Transport if he will give details of the manner in which track and signalling costs and management costs respectively, are estimated for social grants for keeping railways open; and what consideration he has given to the report on this matter, details of which have been sent to him, concerning the criteria on which these figures are assessed.
§ Mr. CarmichaelFor grant purposes track and signalling costs are calculated 9W on the basis of the estimated annual amount required to cover operating costs and to maintain the facilities in perpetuity. Where a grant-aided service shares facilities with other services, these costs are normally allocated pro rata on the basis of ton/miles in the case of track costs and the number of trains in the case of signalling costs. Management costs are assessed on the basis of a fixed percentage of the direct costs of a service. These procedures are in accord with the recommendations of the Joint Steering Group as set out in the White Paper on Railway Policy of November, 1967 (Cmnd. 3439).
I understand that the report to which my hon. Friend refers is the article by Mr. Gerard Fiennes in the January issue of the Rural District Review. This explains in a very useful way the difference between the long-term and the short-term costs of providing a railway passenger service. I must explain, however, that the Government believe that we shall need a substantial railway network for some time to come. It is, therefore, appropriate that grants should be calculated on a long-term basis. Obviously before deciding whether or not to grant-aid a service we also have regard to the short-term financial implications in each case.