§ 24. Sir Fergus MontgomeryTo ask the Secretary of State for Transport what steps he has taken and will take to promote the development of a rolling stock leasing market.
§ Mr. FreemanThe measures include approval in the autumn statement for the leasing of £150 million of new rolling stock by British Rail. British Rail is to establish rolling stock companies and transfer its existing stock to them by 1 April 1994. These companies will lease stock to franchisees and BR's operating divisions pending franchising. They will be transferred to the private sector as soon as practicable. The Government are proposing to add a new clause to the Railways Bill specifically enabling the franchising director to exercise his franchising powers to encourage investment. This would, for example, allow the franchising director to undertake to lessors that, if they supplied new trains, he would ensure that those trains were used on two or more successive franchisees, thus giving the lessors comfort that they would not be left with trains which they could not release at the end of the first franchise. Such undertakings should help to encourage private sector investment in rolling stock in the early years of franchising before an active secondhand market for rolling stock develops.