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Is my hon. Friend surprised to hear that the SNP denies the existence of spatial squeeze, and advisers told senior figures in the Government not to talk about spatial squeeze? Spatial squeeze is real. I return to his point about Bridlington being the lobster capital of Europe. We do not have to divide on this, but I think he will find that it is, in fact, Port William.
I thank the Leader of the House for that update. The House will know that I am obsessive about improving education, skills and life opportunities for young people; I know that the Leader of the House, with his own background, shares that passion. I cannot let this week pass without noting that on Tuesday our new specialist technology and engineering university in Hereford, the New Model Institute for Technology and Engineering, formally launched its new autonomous robotics degree, which is sponsored, designed and delivered in collaboration with the British Army. I thank the Defence ministerial team, and in particular the Minister for the Armed Forces, for coming up to Hereford and supporting that. I believe that it is the UK’s first undergraduate drones technologies degree. It starts in September 2026, which is light speed compared with the normal progression of these things in higher education. It will be of inestimable value not only to young people up and down the country, but to the defence of the realm and in a host of other sectors, including food and agriculture, infrastructure and energy. Otherwise, what a week this has been! Rising international tensions, heated public disagreement, desperate attempts at diplomatic solutions—and that is just Brooklyn Beckham’s Instagram account. Talking of elites, we have had the amusing spectacle this week of that self-proclaimed friend of the people, the hon. Member for Clacton (Nigel Farage), hoovering up the free food and glugging down the champagne with the global bullshiterati in Davos.
I thank you, Mr Speaker, for allowing me to exercise my quadriceps on several occasions. Yes, of course I unhesitatingly withdraw that appalling term from the record. All this, I should say, comes from the hon. Member for Clacton after a lifetime spent denouncing Davos as a hub of evil globalist elites where, in his words, there is “no space for the little man”. At least we know that that is not true any more. Oh, the irony of it all, Mr Speaker! A wildly anti-establishment figure and long-time member of the Reform club—no relation—now joining the globalist elites. Can it be long before he aspires to join the Garrick club, or indeed joins the Prime Minister in professing publicly that he prefers Davos to Westminster? Amid all this nonsense, other, very serious changes are under way. Last week, the Government published the results of the latest auction for renewable energy, which set a floor price for renewables of £91 per kilowatt-hour. No one in this House disputes the importance of green energy, or the importance of renewables in the energy mix—[Interruption.] Few sane people dispute the value of green energy, but energy prices are already unfeasibly high for British businesses and, despite the Government’s promises, are set to go higher still, especially once the cost of new nuclear is added in. The effect of the policy will be to punish taxpayers, and of course bill payers, but it is also a form of corporate welfare, because the only benefits will come to the better-off. Meanwhile, the Government have decided to ignore North sea oil and gas, gravely damage the north-east of Scotland, undermine the employment of thousands of skilled workers, in disagreement with their own unions, and import gas from overseas at greater cost, with more carbon and more carbon miles. In its own way, this is a repetition of the private finance initiative scandal of 30 years ago, in which the country paid tens of billions of pounds more than it should have for public infrastructure, and a lot of wealthy people in the City of London—now resident in overseas countries—made out like bandits. In 1919, John Maynard Keynes wrote a little book called “The Economic Consequences of the Peace” about the disastrous effects of the treaty of Versailles and the demands that it made for payment from the other side in the first world war. I am not suggesting for a second that there is any comparison between these times and those, in Weimar Germany and the rest of it, but I will say that we are facing severe economic constraints as a result of energy prices. I therefore ask the Leader of the House whether we can have a debate on the economic consequences of the Energy Secretary.
It is very nice to have you in the Chair, Mrs Hobhouse. I think this a conversation among Labour Members, and I do not want to get in the way of a private dispute. I might just sit down and listen to what the Minister has to say.
I do. I apologise to the Committee; I erroneously thought that we were dealing with amendment 257 in isolation. There is huge interest in this Bill, which will directly affect lots of people. It will affect the employees, of course, as well as Network Rail, the train operating companies, the remaining franchisees and those already in the public sector, freight and open access operators, the mayoral combined authorities, Transport for London, High Speed 1, the huge supply sector, the trade unions and many others—and that is before we even start to consider passengers. This is a generational change in the organisation of the railways, and it is crucial that the Government do not mess it up. One of the key themes that will run through a lot of our conversations over the coming four weeks is accountability, and new clause 38 would address just one small part of that issue by requiring a ministerial statement, once a quarter, on the progress of the setting up of GBR and its becoming fully operational. There is huge public interest in the Bill, which must be successful, so it would be sensible for the Minister to come to the House and make a statement. That would increase transparency, maintain focus and prevent drift. Mrs Hobhouse, can you give me some guidance? Are we going to talk about the clause more widely later, or should I deal with that now?
Thank you. We have this generational change in the organisation of the railways; the Government, with their majority, have taken a political decision to nationalise the sector. We know that nationalisation of the railways has been tried before. They were nationalised in 1950 or 1951—
The hon. Gentleman is quite right. From 1950, we had the high point of post-war passenger numbers on the railways—about 1 billion passengers. From that period of nationalisation, the number of passengers choosing—I use that word advisedly—to use the railways started a long and seemingly unstoppable decline. It went from 1 billion in the early 1950s all the way down to about 735 million in the period of privatisation—1993. It seemed like that was due to the public changing the way in which they chose to live their lives. The Under-Secretary of State for Transport, the hon. Member for Nottingham South, suggested from her seat on Second Reading that it was obvious that people did not want to use the train so much, even during a period of increasing population, because they were increasingly affluent and they bought more cars. That is a possible explanation. But then something very odd happened. In 1993, the then Conservative Government legislated to privatise the railways. Now, we can debate—and I am sure we will multiple times over the coming days—whether that was a good or a bad thing in principle and whether the way the privatisation was done, through the Railways Act 1993, and subsequently amended was perfect or whether it could have been improved upon, but if we consider that the primary objective of a railway—leaving freight to one side for a moment—is to carry passengers, the data shows that the privatisation of the railways in the United Kingdom was an unqualified success. The seemingly inevitable decline in passenger numbers changed direction immediately. It was not just a slow bottoming out; that long-term decline immediately turned in the other direction, and then continued to grow until covid meant that all bets were off from 2019. Those numbers did not just grow to recover all the lost work of the previous 40 years—they did not go back up to 1 billion customers; they increased to 1.75 billion. That was a period of increased affluence, when the number of cars available to passengers increased enormously. The only explanation for the absolute reversal in passenger numbers is the decisions taken through privatisation—the profit motive and the incentive to focus on passengers rather than on the organisation.
I am grateful to the Minister for giving way. I recognise that improvements are needed for the drafting of the board were it to go ahead. He makes reference, however, to the board of GBR and that it will have a number of directors on it. In normal circumstances that would include a number of non-executive directors outside the main organisation. Will the Minister confirm that that is the intention for this board? If it is the case that external non-executive directors are anticipated for that board, could he go down the list in new clause 24(2)(a) to (f) and describe whether those are the kinds of organisations that might be represented in a non-executive capacity on the GBR board?
I enjoyed listening to the Minister read out the explanatory notes; we are all under no illusion as to what clause 2 stands for. The Opposition think it is eminently sensible—in fact, it lifted directly from the structure proposed by the previous Conservative Government for the draft Rail Reform Bill. Government amendment 164 appears to be a clarifying amendment to help with the dotting of i’s and crossing of t’s and we have no objection.
I beg to move amendment 2, in clause 3, page 2, line 15, after “sale” insert— “by promoting a thriving competitive market in the retail ticketing market”. This amendment makes Great British Railways’ duty to promote a competitive retail market explicit and aligns the Bill with the Government’s stated aim of delivering a system where competition drives better outcomes for passengers.
This is where things liven up a bit. We have had the preliminaries; now we are going to get into the meat of the debate. Clause 3 is where the Government set out the proposed functions of GBR—the list of activities that GBR will be expected to undertake to fulfil its purpose. I use the word “purpose” with some hesitation, because of course no purpose for the organisation is set out in the Bill. The Opposition will seek to address that in a new clause. What is contained within those functions, as well as what is not there, tells us a lot about the Government’s priorities. This is going to be quite illuminating.
I am grateful for that direction, Mrs Hobhouse, but it is quite hard to talk about amendments if we have not considered what is in the clause. I fully accept and follow your guidance that the decision and debate on clause 3 as a whole comes later, but to address amendments to a clause I have to discuss the clause as a whole.
In which case, I will speak first to amendment 2, as that is first in the grouping, and then proceed to the others. Amendment 2 would make explicit the duty of Great British Railways to promote a thriving, competitive retail market, and align the Bill with the Government’s stated aim of delivering a system in which competition drives better outcomes for passengers. The retail market in the UK is currently one of thriving competition, as we can all recognise, and shows UK tech at its best. Trainline is—I think I am right in saying—a FTSE 250 company, and a tech growth story for the United Kingdom, being Europe’s leading train and coach app. The amendment is therefore key to ensuring that the landscape continues to thrive and that we do not drive Trainline and its competitors out of the country. Members will remember that in written evidence to the Transport Committee, Trainline asked that Committee “to recommend that the Bill be amended to require structural separation of GBR online retail from the rest of the GBR organisation and to publish information that enables the ORR, CMA and other regulators to assess compliance with competition law, subsidy control rules and non-discrimination duties. This should not be left to the Code of Practice alone”— and, by the way, we have not seen the code of practice. Trainline also said: “We ask that the Committee recommend that the Bill include a statutory duty that all retail market participants—including GBR online retail—are treated fairly, equally and non-discriminatorily, and that GBR online retail be subject to the same Code of Practice as all other retailers…We ask the Committee to recommend that these economic parity safeguards, including structural separation of GBR’s online retail business, be written into the legislation and the forthcoming Code of Practice…We therefore ask that the Committee recommends…An explicit ORR power to impose binding orders or financial sanctions if GBR breaches its licence or the Code. ORR’s competition duty should explicitly apply in respect of these functions and GBR’s licence…Provision for an appeal body (for example the CMA or the Competition Appeal Tribunal) to hear merits of disputes…The Code development process must be led by ORR, independent of DfT and GBR. It must ensure full stakeholder consultation, clear timetable, transparent publication of decisions and mechanisms for future amendment.” Members may say, “Well, they’ve got skin in the game, haven’t they? They’re a commercial organisation trying to compete with the future GBR, so it will be in their interest to try to fix the corporate structure in a way that gives them an unfair advantage.” But if we look at what Trainline is asking for, we see it is not seeking to gain an unfair advantage. It is merely asking GBR to create a level playing field. Trainline is not the only organisation making that argument; it is joined by others.
That demonstrates that the current system is working to hold Trainline to account, and that where there are abuses—if what the hon. Gentleman outlined amounted to abuses—effective systems are in position and they have been corrected. The hon. Gentleman’s intervention did not speak to the overriding point: what do the Government want when they are applying this new structure to retail? Do they want a level playing field? Is that their intention, or do they want a systemically biased system in which GBR retail is given an unfair advantage over independent competition? Both answers are credible—it is possible for the Government to form one decision—but they should not pay lip service to a level playing field but, in design, achieve the opposite, which appears to be the case at the moment. In oral evidence to the Transport Committee, Ben Plowden, the chief executive of the Campaign for Better Transport, essentially agreed with Trainline’s position. He said: “We think that because the independent retail market has produced significant benefits for customers in the time that it has been in existence. It is heavily used by rail passengers. The critical question in relation to the Bill, and the other mechanisms that will be in place once the Bill has been passed, is how we ensure that there is genuine fair and open competition between GBR ticket retailing and the independent retailers currently or potentially in the market.” This is a key point: the Government need to stop and think about what their intention is. If it is to have a fair market, the evidence, and all the feedback they are getting from the sector, is that they have not yet achieved that objective. They need to put their money where their mouth is and decide what their objective is. I hope the Minister will be clear in his response as to the Government’s thinking on that. A second concern is that the sector is nervous about the apparent lack of hierarchy and detail in the functions. GBR is assigned multiple duties under the clause, but with no hierarchy, so it paves the way for potential confusion—or, worse, it gives GBR the ability to pick and choose which function it thinks is important in relation to any decision. It can quietly demote the importance of others so that it can serve itself and thereby reduce the power of the clause. Nick Brooks from ALLRAIL said in oral evidence to the Transport Committee: “To lead from your further question: with the very broad powers for the Secretary of State and a certain lack of specificity on what will happen, what we are looking for is more key performance indicators, like in business. I realise it is a governmental entity, but the quantitative KPIs are not really there.” I would go further than that: they are not there at all. As well as amendment 2, which I have spoken to, we have also tabled new clause 3, which sets out GBR retail requirements. As I have said previously, this is a critical issue given the evidence that the Select Committee received, and the oral evidence that we heard on Tuesday, that the Government have built a structural conflict of interest into the Bill as currently drafted. We also heard on Tuesday about international examples where a similar concern has been addressed in a different manner. SNCF is a state-owned railway in France that has unification of track and train. It also has a retail function, through which is competes with the wider market. SNCF, or, I presume, the French Government—I do not want to claim greater in-depth knowledge that I actually possess—have taken the decision to have a structural separation between SNCF retail and SNCF operations, the equivalent to GBR. The very obvious reason why they did that was for fairness and to have a level playing field. We are not talking about SNCF, but an improvement on the current position, which I fully accept is not perfect.
I do not wish to interrupt the hon. Member’s flow, but there is a wider point there. The hon. Member is right to mention that the Government have frozen fares, but they have not reduced the cost of providing railway services. All they have done is frozen fares on the one hand and increased taxation on the other—and the taxpayer is having to pick up the difference. Does he agree that what the Government have done is put money into one pocket, but taken it out of the pocket of passengers who are, presumably, taxpayers?
I have great respect for the Minister and I hear with interest what he said, but I am not convinced that the sector will receive sufficient reassurance from that, so I intend to push the amendment to a vote. Perhaps others, subsequently, as well, but we will deal with those later. Question put, That the amendment be made.
I beg to move amendment 241, in clause 3, page 2, line 17, after “including,” insert “acting in a fair and non-discriminatory manner”. This amendment would require equal treatment between GBR and non-GBR services.
It is a pleasure to see you in your place, Sir Alec. Amendment 241, in my name, is important, as so many of these amendments are. We heard in both oral and written evidence that lots of people are concerned about the need for this amendment, which addresses the concerns of many in the non-Great British Railways sector, whether Trainline, open access operators, freight operators or the whole supply chain. The amendment seeks to require GBR expressly to act in a fair and non-discriminatory manner. We had some discussion about that before lunch, but I reiterate the argument that I made. I will seek to press the amendment to a Division if the occasion demands it, but it would send a terrible message to investors in the independent sector if the Government voted down an amendment that merely asks GBR to operate in a fair and non-discriminatory manner. Amendments 3 and 4 clarify that the research, advice and standards published by Great British Railways are related to aspects of the parts of the railway and railway services that are managed by Great British Railways. Many independent entities, such as freight, open access and the supply chain, as well as other networks, are not managed by or part of GBR. Those entities need to be free to publish their own standards and manage their own innovation and research. The current drafting of the clause is a clear overreach. I suspect that that may be unintentional, so I ask the Minister or his officials to have a think about that. Additionally, other cross-sector and national standards, such as those managed by the Rail Safety and Standards Board or the British Standards Institution, may be directly legally applicable to GBR itself under, for example, the Railways (Interoperability) Regulations 2011 and the Railways and Other Guided Transport Systems (Safety) Regulations 2006. To avoid conflicts of interest, those cannot be published or managed by GBR itself, so the Minister needs to explain how clause 3 does not involve a conflict of interest. Has he—or, it is probably gentler and kinder to ask, his team—researched those apparent contradictions? If he or they have, perhaps he could set out how those conflicts are addressed in the current wording. Amendment 5 would leave out clause 3(2) and insert in its place: “(2) Great British Railways’ function under subsection (1)(a) includes making strategic plans as to the future provision of railways infrastructure in Great Britain and implementing those plans. (2A) Decisions about access to, and use of, railway infrastructure for the operation of trains will be made by the Office for Rail and Road.” This would be quite a big change, because it would address head on the structural conflict of interest that has been identified by very many commentators. The role of the Office of Rail and Road is a key concern for the non-GBR part of the industry, which is, after all, 60% of it. By “the role of the ORR”, I do not mean its safety role, which remains almost entirely unchanged; I mean its economic regulator role. This is not an issue of ideology. Some play has been made about base views on whether nationalisation or privatisation are better or worse than one other, but let us leave that to one side—we have had our fun for the moment. This is a fundamental issue of fairness of procedure, which is necessary irrespective of the ownership structure of the organisation. We all know that Great British Railways will be the dominant operator. That position brings it structural advantages in any event, but it will now be the referee on access as well. That is a direct and obvious conflict of interest, and it is a very odd approach because it is so clearly unfair. The alternative is to use an independent structure. We would use the ORR because it already exists and does not have to be created, it already has a reputation for independence, and its remit and direction are set by the Secretary of State, so it cannot be a loose cannon. I accept in part the arguments put forward by the Minister in response to questioning on Tuesday. I recognise that the Government own the infrastructure and the taxpayer has invested many billions of pounds in the railway over time, and I accept that they should decide how those funds are best used. The issue is how the Government look after taxpayers’ money. Is it via a player-referee—GBR—or is it via the Office of Rail and Road, which is itself a governmental organisation, has its remit set by the Secretary of State and is given direction? It is not as though we would be handing the keys to a stranger; we would just be demonstrating the application of a fair and non-discriminatory process by an overtly independent organisation that is itself an arm of the state. Amendment 5 aims to ensure that the Office of Rail and Road continues to make decisions about access. It is a common theme of the Opposition amendments throughout that we want to ensure that the Bill does not create a GBR with that structural conflict of interest that acts as referee and player. I intend to press the amendment to a Division, should the opportunity arise. Finally, I turn to amendment 6, which would leave out clause 3(3). Subsection (3) is a very broad regulation-making power for the Secretary of State to confer further functions on GBR. It is unrestricted. It reads: “The Secretary of State may by regulations confer on Great British Railways such other functions relating to railways or railway services as the Secretary of State considers appropriate.” Could it be any more widely framed? I do not think so. As long as it is something to do with railways, it takes power away from primary legislation and gives it to the Secretary of State to do as he or she will. It is a blank cheque for the Government and, by extension, for GBR. There are no details given as to why it is needed, and no reason why the powers have not already been considered. We know that the Government have gone off half-cocked with this legislation. By Tuesday’s count, 19 serious documents relating to how GBR will work in practice have yet to emerge. I would be interested to hear the Minister’s justification for subsection (3). Why are the Government so keen to give such overarching powers to the Secretary of State? Sir Alec, are we also going to deal with new clauses 15 and 20 tabled by the Liberal Democrats?
That is just as well, because I am going to leave those to the Liberal Democrat spokesman, but I will be happy to support new clause 15 should he be minded to press it to a vote.
Correct me if I am wrong, but my recollection of Sir Andrew Haines’s oral evidence is that he gave an example of the experience not just on continental Europe, but in Scotland, where a steady-state period of electrification resulted in significant reduction of the cost per mile when compared with the stop-start approach in England. Does the hon. Gentleman agree?
To clarify, that figure is about not just the private sector, but rail services in Scotland and Wales not being part of GBR. It is the non-GBR parts of the greater rail world: about 60% are nothing to do with GBR.
It is always a pleasure to hear the Minister explain the Government’s positions, but I remain unconvinced in relation to amendment 241, which I believe is the only one that can be put to a Division at this stage. I would like to press it to a vote. Question put, That the amendment be made.
I am very supportive of the intent behind this new clause. Where the Government have taken the political decision to put all their eggs in the nationalisation basket, it becomes even more important that we add as many clauses to the Bill as possible to force them to focus on the passenger experience. Nationalisation has been tried before, not just in the railways but in a number of other organisations, and not a single one of them is a byword for individual customer choice, so if experience is anything to go by—and if we are, as seems likely, going to be forced to have a nationalised approach to the railways—the legislation needs to bend over backwards to keep reinforcing the point that the passenger experience is the central element that the organisation should be aiming for. At the moment, the Government are woefully unambitious in their definition of railway services. If you look at clause 18(3)—which I am sure you have already, Sir Alec—you will see that the definition for railway service performance “includes, in particular, performance in securing each of the following in relation to railway services”. I was expecting a long list of all the good things that customers travelling on the railway should expect, but what do we get? We get “reliability, (including punctuality),” and “the avoidance…of passenger overcrowding”, and that is it. What poverty of aspiration. It really is very striking. It may be that the wording of new clause 8 could be improved—I am sure that the Government have the drafting firepower to do exactly that—but what is listed in subsection (2)(c)(i) to (vi) is a good starting point, and certainly much better than what the Government managed to come up with in clause 18. I support it.
The official Opposition, strongly support this amendment because it seeks to increase passenger traffic on the railways, in addition to the welcomed inclusion of an objective to increase freight. We agree with it so strongly because it is almost identical to our amendment 35, which I shall also speak to. Amendment 35 would add a specific requirement to subsection (2) paragraph (b) of clause 18—the duties clause—for GBR Ministers and the Office of Rail and Road, “to increase the number of passenger journeys”. This directly addresses the concern raised by the Campaign for Better Transport in the evidence received by the Committee. It is an essential amendment to ensure that GBR has a key focus and aim to increase passenger numbers—something that is essential for a railway. It would ensure that the dominant culture of GBR is not one where passengers are seen as creators of damage to infrastructure. That is not a loose accusation that I have made; I have been listening to the industry for over a year now. The core structure of GBR is Network Rail. I know that I am bound to be corrected if I get this even a couple out, but I believe that Network Rail has about 41,000 members of staff. Network Rail is the central body to which train operating companies have been added at a rate of about one every six weeks or two months over the last period. An oft-repeated criticism of the culture of Network Rail has been that it sees passengers as a necessary irritation in the correct functioning of the railway. Sir Alec, if your organisation is engineer focused, the condition of the infrastructure is what is most important to you. Passengers demand lots and lots of trains, but lots and lots of trains damage the infrastructure. There is a concern in the wider sector— I am merely passing it on—that the culture of Network Rail has historically been one in which it wants to limit the number of trains to what it considers to be acceptable, so that it has a nice steady state of repair of the infrastructure. If that is the dominant culture that pervades GBR, now that it is bringing everything together, that will be a disaster for passenger services, because there would not be an automatic incentive to focus on an increase in passenger journeys, which is why amendments 133 and 35 are so important. New clause 42—to go into the detail a little—would require the Secretary of State to set, publish and keep under review a passenger growth target. It would also require GBR to have regard to that target when exercising its statutory functions. In oral evidence to this Committee, Ben Plowden, chief executive of the Campaign for Better Transport, said: “It is welcome that there is a duty to promote the interests of passengers and disabled people in the Bill. We think there is a case for strengthening that duty so that it aligns with the duty in relation to freight, which is to promote the use of the network for passengers and disabled passengers. There should also be an equivalent duty on the Secretary of State to set a passenger growth target, as she is required to do in relation to freight, so that, as we picked up on a minute ago, GBR does not end up being incentivised not to grow the network in order to meet its crowding and reliability duties, for example. It seems to us that giving it a statutory incentive to increase passenger use over time would be very helpful to build on the existing duty in the Bill.”––[Official Report, Railways Public Bill Committee, 20 January 2026; c. 24, Q49.] That organisation was not alone, because John Thomas from ALLRAIL said: “I think a passenger growth target is really important. At the moment, the duties for GBR only include improving performance. You can improve performance, as we saw during covid, by cutting the number of services, but that is not necessarily in the best interest of customers. We think a balance between a performance target and a passenger growth target is really important.”––[Official Report, Railways Public Bill Committee, 20 January 2026; c. 47, Q78.] Finally, we heard from Rob Morris of Siemens. He said: “What we seem to be missing in the Bill at the moment is the ambition for passenger growth, how that will improve the railway and the levels of investment that need to go with it.”––[Official Report, Railways Public Bill Committee, 20 January 2026; c. 64, Q122.] It is unclear to me why, if the Bill can require a target to increase use of the railway network for freight, the same obligation is not applied to passenger services. The inconsistency suggests a deliberate choice not to mandate passenger growth. And why would GBR care about passenger growth? After all, if it will be dominated by Network Rail, there is at least a risk that its culture will be one of avoiding damage to infrastructure, in excess of looking after growing the number of passengers. In written evidence to the Transport Committee, Rail Forum said: “From Rail Forum’s perspective there is nothing specific in the Bill that will guarantee improved travel for passengers. Improvement is predicated on the goodwill of GBR and others driving things in the ‘right direction’. In our view the key to improvement is culture change within those organisations coming together to form GBR. Creating GBR from Network Rail Infrastructure Ltd…will not signal the need for change and creates a risk that the current Network Rail culture will be seen as the norm and hence the status quo will prevail.” These are not arguments made up by a cunning Opposition to wrongfoot the Government. This is the Opposition doing our job properly and reflecting the concerns of the wider sector—not just from one organisation but from multiple organisations, right across the sector. They identify the drafting as a problem and the culture as potentially a problem unless the legislation makes it clear that it is a duty of GBR to increase passenger numbers.
The hon. Gentleman makes a good point. It is right partially to defend Network Rail. It is an issue of balance and of the culture going forward. He also talked about capacity—this is not a party political point—but that is determined by not just the number of trains, but the length of trains, which makes an enormous difference. Just increasing carriage numbers—in particular on the Northern rail network where the majority of trains are just two carriages—by a couple of extra carriages does not require significantly increased capacity on the line, but it does increase capacity enormously for passengers. That would allow a target for increased passenger numbers to be fulfilled, without an increase in line capacity.
I do not propose to divide the Committee on clause 3. If the Bill is going to progress, then some version of the clause needs to be in it. We are doing our best to improve it; we have not been successful so far, but I have not given up hope—there is more to come. New clause 1 is a purpose clause. One of the very obvious gaps in the Bill is that there is no clause setting out its purpose. It is based on a number of objectives, which are set out in subsection (1)(a) to (m)—13 paragraphs. Paragraph (a) sets out the mission that the priority in decision making should be the needs of GBR passengers. That builds nicely on the discussion we have just had. With a nationalised organisation, we need to go the extra mile to clarify exactly what its focus should be, because it is, by design, a top-down command structure of the state. In a functioning—I stress “functioning”—competitive market, the market will force operators to focus on their passengers, because the passengers are also their customers and that is how they grow their profits. When we take the deliberate decision to move away from market competition, something has to replace it, and the only thing that can replace it is the legislative process. That is why the new clause is so necessary. The priority in decision making needs to be GBR passengers; although we can infer this from statements by the Government, enshrining the mission statement would ensure that it remained a beacon for the organisation to follow. Paragraph (b) states the objective of “delivering reliable, safe and accessible railway passenger services”. I do not think that that is controversial for any of us. Paragraph (c) sets the aim of “providing value for money for passengers and taxpayers, including consideration of the affordability of fare prices”. With a state service, the public expect value for money to be the driver, to ensure continued investment and reinvestment in our rail network. At the moment, fares remain a key concern of passengers and taxpayers. The affordability of fares must be one of the primary objectives. Paragraph (d) points to increasing passenger numbers and growing usage of the network. We do not want to see what happened during the nationalisation era, when service quality fell and people consequently turned to other modes of transport when reliability decreased. Keeping people adopting the railways, as we have seen explode under privatisation, is very important. That links nicely with paragraph (e), which would ensure that the network is continually expanded and improved, with constant analysis of service and connectivity improvements as well as restoring and adding routes.
My hon. Friend makes a very interesting point. One of the stand-out moments from Tuesday’s oral evidence was that given by the mayors, Andy Burnham and Tracy Brabin. What it highlighted, apart from their articulate defence of their regions’ interests, was how different things will be, under the current proposals, in mayoral combined authorities: there will be the right to ask or be consulted on the devolution of aspects of rail to those authorities. That is great as far as it goes—they said that it did not go far enough, but it goes some distance in that direction. However, what if an area is not a mayoral combined authority? I believe that is the point that my hon. Friend is making: without the direct relationship that the Government are anticipating for mayoral combined authorities, at the expense of other parts of the country, the “purpose” clause becomes more important. That is another reason why paragraphs (e) and (f) and others are helpful. Many Members and constituents across the country were enthused by the restoring your railway fund and the new stations fund, which have unfortunately now been scrapped by this Government. They were set up in the last Parliament and led to a renaissance of interest in local railway investment and a focus on modernising working practices and innovating to improve productivity, efficiency and passenger experience. Working practices are not really spoken about in the Bill as it is currently drafted. This is not a new start-up—we have to be quite clear about that: it is building a new organisation out of some very old organisations, including Network Rail. The aim of modernisation is to do more for less. That is a good thing because it means that there is more money left over for further investment in improving infrastructure and improving or increasing passenger services and more left in the kitty to reduce subsidies—the taxpayer support—and by extension reduce the tax burden on our hard-pressed constituents. Doing more for less by modernising working practices and innovating to improve productivity efficiency is an unalloyed good. It should be very important and at the heart of any organisation—yet the Bill is silent on it. Although I can hear the subtext, but the new clause is not intended to be a union-bashing measure. It is intended to make a dynamic organisation that has its passengers—its users—at the heart of its interests and that there is a focus on ensuring that GBR continues to have growth as part of its objectives. That aligns with the Government’s decision to put growth at the heart of their mission.
Yes, I do, but then democracy is really messy, isn’t it? If we listen to passengers and our constituents, we hear all sorts of desires that may not be sufficiently persuasive to obtain Government funding, but the process of asking people for their views should not be shied away from. It sounds as though, in the experience of our former colleague Huw Merriman, some rather weak political decisions—or decisions of expediency—were taken. That does not mean that we should move away from the democratic process; we should listen to people. I do not say that the restoring your railway fund was a failure, because we listened and we heard. I will pick up on the other point because I was sitting down when I barracked the hon. Member for Birmingham Northfield: modernisation is not just about working practice. I want to make that really clear: modernising is about productivity enhancement of at-times-sclerotic organisations. I am a former entrepreneur. I ran a business for well over a decade on a much smaller scale than this. At the end, I employed about 1,000 people; I took it from start-up to about that stage. Even a fast-growth, highly entrepreneurial and—in the views of other people—highly dynamic business such as the one that I was lucky enough to lead had all sorts of internal inconsistencies and inefficiencies, and needed to focus relentlessly on improving working processes and practices. That was right at the sharp end of the private sector. If it was true for my organisation then, think how true it is for a very large organisation such as Network Rail, which has 40,000-plus staff, and will be much bigger still when it becomes Great British Railways. Paragraph (h) of new clause 1 states the need to improve and consider “the experience of disabled and vulnerable passengers”. Key terminus stations have good systems in place but that could be expanded with investment such as in the cross-party Access for All fund, which did huge work to improve disabled access in stations. Paragraphs (i) and (j) are on a key theme that we have explored throughout our consideration of the Bill: open access and freight. They would ensure “fair and transparent treatment of open access, freight and devolved operators” At times it feels like we speak too much about open access in relation to this Bill. If we look at the capacity—the number of passengers covered by open access operators—we see that in percentage terms it is very small.
I was going to say 1.5%, but maybe it is 2%. Let us call it approximately 2%; I leave rail freight in a separate category. But open access operators have a disproportionate impact on driving competitive challenge. One of the very significant concerns of the sector, which I share, is that if the very dominant GBR is created and the operator and open access operators are not supported, even though they represent just 2% of passenger transit what will be lost is the competitive comparator for what good operating processes and customer-focused activities for train operations look like. It is disproportionately important that GBR should be held to account practically by the operations of open access operators, so such operators must receive fair and transparent treatment. That is what paragraphs (i) and (j) set out. They would ensure that the system is transparent where we believe that the legislation as drafted is currently vague. Paragraph (j) enshrines the growth freight targets that we all agree on and that the Government have outlined. Paragraph (k) states the need to strengthen “the financial sustainability of the railways” to reduce reliance on subsidy. That should be an objective, and a purpose, of GBR. The taxpayer has lots of things that his or her money needs to be spent on. If we can reduce, over time, the need for subsidy on the railways, that money is freed up either for tax cuts, which make everyone richer, or to be spent on other important priorities of Government. Meanwhile, paragraphs (l) and (m) speak to another key aim—integration, both of track and train, and of the mayors, with their local transport integration beyond rail, which are important to have. The lack of explicit inclusion in the Bill feels like an oversight that we are more than happy to shed light on for the Government. Sir Alec, you will be pleased to know that that is it as far as new clause 1 is concerned, but I do have new clause 2 to entertain you with, which is about key performance indicators. The Government have been asked multiple times over the last few months to provide, even in draft, the KPIs that they intend Great British Rail to operate under. This clause is a first attempt to fill the gap that the Government have left by refusing time and again even to discuss what the KPIs will be, other than to say, using their go-to phrase, that they will be “robust”. What does that mean? We do not know. The new clause would set a statutory key performance indicator framework, which must include targets for a number of areas, such as reliability, safety, cleanliness, affordability, passenger growth, financial efficiency, freight and others. It is necessary because of the failure of the Government. I would be delighted to withdraw it if the Minister were to stand up and say, “These are the KPIs that the Government have in mind—let’s debate them.” At the moment, we have draft legislation in front of us—we are a scrutinising Committee and we are here for a month to go line-by-line through the Bill to improve it and understand how GBR will be operated—and yet we have no idea what the Government are even thinking on KPIs, which are a central set of objectives. This new clause seeks not to bind GBR or the Secretary of State to rigid targets, but instead to provide an overall remit for where the Secretary of State and GBR must report within. Accountability is at the core of public trust in nationally run services, and setting targets in statute ensures there is a positive feedback loop for officials—very importantly—and GBR agents to work against. It helps frame discussions and engagement between the Departments and GBR, and allows a number of different datasets and parameters to be considered. The new clause would also require the Secretary of State to publish these indicators and lay them before Parliament. The KPIs work as a strong starting position by which GBR can judge itself, and how it in turn can be judged by passengers and the public. Again, the Opposition are having to do the Government’s work for them. We should not be in that position. The Government should have brought forward this Bill with the accompanying documentation, which, as we have heard, is missing— 19 important documents and counting. Finally, I turn to new clause 5. You will be pleased to hear that it is much shorter, Sir Alec. The new clause would give reporting requirements to GBR, continuing the theme of accountability, which new clauses 1 and 2 also have at their core. The layout of the new clause is self-explanatory. Subsections (2) and (3) link to new clause 2 on key performance indicators, and the clause would enhance accountability further, not just by having targets in place, but by having a clear reporting criterion. In the same way that a Secretary of State is expected to appear in front of Parliament on a rotating basis in urgent questions, in Committees and through written ministerial questions, it is reasonable to expect that GBR should publish an annual report in which it reports on the targets set by the Secretary of State. Given the eminently sensible and logical outcome of the new clauses, I urge the Government to consider seriously on what basis it would not want to create greater transparency.
I am grateful to the Minister for setting out his defence of the Bill. The problem with his argument is that, because the Government have gone off half-cocked, the Committee is not in a position to assess whether he is right or wrong on the nature of the KPIs, or even on where they should be, because we have not been furnished with any draft copies of the documents to which he refers. In those circumstances, I feel obliged to press the two new clauses to a vote. Question put and agreed to. Clause 3 accordingly ordered to stand part of the Bill.
I thank the Minister for his brief explanation of the clause. Under clause 3, the Committee was able to discuss the principles of the future structure of GBR, but clause 4 is the first instance of one of the open wounds that the Bill might create. The devolutionary functions of the Bill seemingly reopen aspects of the West Lothian question by failing to provide clear lines of power between the devolved nations, regions and Whitehall. The elephant in the room is the future surrounding England and Wales projects. We know from the evidence we heard that the Welsh railway is very different from, for example, the Scottish railway; 80% of all rail travel in Wales is cross-border, so it includes elements of English travel, as we can tell by Labour’s recent announcement that East West Rail and the Hull to Liverpool lines are being classified as England and Wales projects. Some members of the Minister’s party in Wales might think that is a bit of a stretch at the very least. The Government’s position has consistently been based on the fact that infrastructure is not subsequent to Barnett consequentials in Wales, and therefore should not be allocated to Cardiff Bay. However, the Minister’s own Labour party colleague in the Senedd, Cabinet Secretary for Economy Rebecca Evans MS, said: “Wales will have missed out...as a result of the incorrect classification of HS2 as an England-and-Wales project.” That was Labour’s position when it sat on the Opposition Benches, and it is seemingly still the position of the Labour Government in Cardiff. Is it still the position of the Minister and of Labour? Clause 4 allows the Scottish and Welsh Governments to maintain their nationalised railway structures within ScotRail and Transport for Wales. It is prudent that the Government maintain their and GBR’s final say in these matters, as set out in subsection (2). However, much of the relationship is predicated on the memorandum of understanding, which is missing in action and is not explicitly established in the clause. It is important to ensure that the Government are thinking clearly about the nature of the relationship they wish to maintain with the devolved nations, as this framework will exist within the future memorandum of understanding—which none of us has seen. That will be particularly important should the Wales Act 2017 be amended at some stage, given that Welsh devolved powers are a live political issue. Will the Minister explain Government’s approach to future transport devolution in Wales, given his party’s comments on rail funding?
I beg to move amendment 232, in clause 5, page 3, line 37, at end insert— “(2A) Where no arrangement between Great British Railways and a relevant local authority exists, the relevant local authority may appeal a decision made by Great British Railways affecting passenger rail services within its boundary under section 67.” This amendment is designed to give Mayors the right to appeal GBR decisions to alter passenger services in their area to the ORR in the event of no partnership existing.
Thank you very much, Sir Alec. We are making progress—it may not feel like it, but we are. Courage! We’re getting there. Clause 5 deals with co-operation with relevant local government bodies. It is not going to be a bestseller, but it is important, just like every clause in the Bill. It delves further into the devolution of powers. It is hard to quantify the clause while the Government’s devolution Bill continues its progress through the House, which creates an awkward chicken and egg scenario. The challenge with the clause, about the nature of the devolution of powers across local government, really ends up bleeding into clause 6. I am concerned that the Government and, by extension, GBR will end up picking and choosing who they wish to accept consultation decisions from. Clause 5(1) specifically uses the word “may” when referring to arrangements between GBR and local government. It states: “Great British Railways may enter into arrangements with a relevant local government body about the exercise by Great British Railways of its statutory functions in relation to railways and railway services in the body’s area.” There is no clear obligation to provide any functions to mayoral combined authorities, mayoral combined county authorities, passenger transport executives or integrated transport areas. Can the Minister help me and the Committee by clarifying what functions he has in mind in relation to this clause? How would it work in practice? Will there be guidance on it, and when will we have it? Has that work been done yet? If it has, why has it not been shared with the Committee, with its obvious corollaries? If it has not been done, why not? That leads me to amendment 232 in my name, which would create a new subsection (2A) of clause 5 as follows: “Where no arrangement between Great British Railways and a relevant local authority exists, the relevant local authority may appeal a decision made by Great British Railways affecting passenger rail services within its boundary under section 67.” To bring the amendment to life, we need to refer back to the evidence from Mayors Brabin and Burnham on Tuesday. The amendment would give mayors and other regional leaders the right to appeal GBR decisions to alter passenger services in their area. They would be able to appeal to the ORR, because it would be an independent appeals process, in the event that there was no partnership in existence. In their evidence, Mayors Burnham and Brabin were clear that they expected—in fact, I think Mayor Burnham said he would insist on—greater powers to influence rail in their regions. The amendment would help to achieve that through a continued role for the trusted and impartial Office of Rail and Road. At this stage, I should make it clear that while the power to appeal is set out in clause 67, the governance—what that appeal can look like—is set out in clause 68. I think I am right in saying that it was described as not being worth the paper it is written on as it is drafted, because it limits appeals to judicial review proceedings in the High Court where there is an error of law. There is strong evidence before the Committee to suggest that that clause should be amended to allow an appeal on the merits, and amendment 232 needs to be taken in conjunction with future amendments that we will put before the Committee to do exactly that. It is intended to include in the Bill the provision for an appeal on the merits to the independent ORR, in order to give succour to mayors and other leaders of regional transport authorities where GBR chooses to run roughshod over their local plans.
This Committee has been a good example of the hon. Gentleman’s party and mine working collaboratively to improve the Bill. While he knows that I agree with the direction of travel that his amendment has in mind, I question its extension to an organisation as small as a district council. Given that district councils are a feature of two-tier local government—there will be a county council above them—can he explain why he thinks it is sensible to include them in the amendment?
I listened carefully to the Minister’s explanation as to why, in his view, amendment 232 should be withdrawn. He said that GBR will agree to co-operation with mayoral combined authorities. He also said that other parts of the Bill contain a duty to consult and a requirement to receive advice from mayors, but there is no requirement to listen to that advice. As a result, the decision-making power remains with GBR, not the regional area that is most affected by the decisions, which the Minister, on a number of occasions today, has already said is best placed to decide the needs for its local community. That is fine—if the Minister wishes to keep the word “may”, it is, of course, his right to do so. However, if the less powerful of the two people in the relationship disagrees with GBR’s decisions, they need to have some form of recourse to an appeal. For that reason, I believe that the appeal process set out in amendment 232 remains important and that the amendment should be put to a vote. Question put, That the amendment be made.
I beg to move amendment 7, in clause 6, page 4, line 15, after “with” insert “Secretary of State and”. This amendment maintains the Secretary of State’s statutory co-operation duty with Transport for London to keep the position in line with other mayoralties.
Clause 6 deals with co-operation between GBR and Transport for London. The clause seems to exist in direct juxtaposition to clause 5, and, interestingly, to the general spirit of the Bill expressed in other clauses. While many aspects of the Bill bring powers back to the Department for Transport, GBR and the Secretary of State’s office, the clause is unusual in being one of few examples where those on the Treasury Bench do not seem to want to be involved. That is out of character. Through the clause, the Government seek to remove the Secretary of State’s position in the Greater London Authority Act 1999 and replace that responsibility with a similar one for Great British Railways. That is not based on enhancing accountability or strengthening value for the taxpayer, which should be core principles of the Bill. The clause presents special status for Transport for London that is not enjoyed by other mayoral combined authorities; that relates to a point that Committee members will recall Andy Burnham making during our oral evidence session on Tuesday. He expressly referenced the difference in how the Greater Manchester mayoral combined authority is treated on transport matters compared with how TfL is treated. We need to ask why that is. Mayor Burnham’s evidence highlighted that difference, yet the Government have given no effective answer about the rationale behind treating large, regional mayoral combined authorities differently from Transport for London. The amendments in this group seek to correct that, proposing that, until such a time when the other mayoralties require their own special dispensation, which clause 5 of the Bill actively prohibits, clause 6 should be amended to maintain reference to the Secretary of State, and include the Secretary of State and GBR side by side, so that the relevant subsections of section 175 of the Greater London Authority Act 1999 refer to both “the Secretary of State” and “Great British Railways”. That would ensure that the Secretary of State continues to have a duty of co-operation with TfL, alongside GBR.
I am grateful to the Minister for his explanation, and to the hon. Member for Bexleyheath and Crayford for giving his lived experience of the TfL area. I am partially convinced. I will not press this amendment to a Division, so I think we can move on. I beg to ask leave to withdraw the amendment. Amendment, by leave, withdrawn.
I agree with the Minister’s characterisation that these are largely technical or tidy-up amendments. It is right to include freight in the duty to cooperate with TfL. I am glad that the Government have tabled these three amendments and we have no objection to them. Amendment 165 agreed to. Amendments made: 156, in clause 6, page 4, line 26, after “passenger” insert “and goods”. This amendment and amendment 157 add GBR’s statutory functions in relation to freight services to the functions in relation to which GBR must co-operate with Transport for London. Amendment 157, in clause 6, page 4, line 26, at end insert— “(7) In subsection (3A)— (a) after ‘passenger’ insert ‘or goods’, and (b) after ‘passengers’, in both places it occurs, insert ‘or goods’.”—(Keir Mather.) See the explanatory statement for amendment 156. Question proposed, That the clause, as amended, stand part of the Bill.
The Minister has set out his views on this clause clearly. We have already explored the difference of opinion about whether or not it should be the Secretary of State and GBR that collaborate with TfL. However, the direction of the clause is an eminently sensible one and we do not wish to stand in its way. Question put and agreed to. Clause 6, as amended, accordingly ordered to stand part of the Bill. Ordered, That further consideration be now adjourned.—(Nesil Caliskan.)