Railways Bill

Public Bill Committee, 18 January 2005.

Standing Committee A

Railways Bill

Tony McNulty (Labour, Harrow East)

On a point of order, Mr. Amess. As promised, I have penned a letter that is available both here and on the board covering a range of points on which I promised to get back to the Committee, including further information on the Transport for London issue, the Rail Passengers Council, the Strategic Rail Authority and Department for Transport rail group, a series of issues on network modifications and the headlines of the guidance on passenger transport executives. That letter is available to the Committee today for hon. Members' delectation, and I shall ensure that it is on the board.

I need to make one minor correction. Perhaps unusually for me, given my tendency towards hyperbole, when I referred during our deliberations on the Gatwick Express to passenger numbers on the Brighton line rising by some 72 to 75 per cent., I was conservative in my estimation. That figure is closer to 85 per cent., but it none the less reinforces my point about the Brighton commuter line and the Gatwick Express.

At 2 o'clock today, the Scottish Parliament will start its deliberations on the Sewel motion associated with this Bill. The wording of the motion is:

''That the Parliament agrees that those provisions that confer executive powers and functions on the Scottish Ministers in the Railways Bill and those that relate to devolved matters should be considered by the UK Parliament.''

There are evidence sessions today with Network Rail, the Office of Rail Regulation, the Strategic Rail Authority, the Rail Passengers Council and the Scottish Trades Union Congress. The Minister for Transport, Nicol Stephen, will give evidence from 11 o'clock tomorrow, and the Sewel motion is expected to be debated in plenary after the Committee completes its consideration. When I have any more information about the progress of the Sewel motion and any other papers tabled, I will let hon. Members know.

Sir David Amess (Conservative, Southend West)

On behalf of the Committee, I thank the Minister for that helpful information.

David Wilshire (Conservative, Spelthorne)

Further to that point of order, Mr. Amess. Since the Minister said that he is now conservative, I point out that we have a vacancy in our party if he would like to join us.

Sir David Amess (Conservative, Southend West)

I think that we will leave jokes until the end of our deliberations.

Clauses 50 to 52 ordered to stand part of the Bill.

Column Number: 274Schedule 10

Taxation provisions relating to transfer schemes

Tony McNulty (Labour, Harrow East)

I beg to move amendment No. 120, in page 125, line 32, leave out 'or'.

Sir David Amess (Conservative, Southend West)

With this it will be convenient to discuss Government amendment No. 121.

Tony McNulty (Labour, Harrow East)

I apologise if the first of these amendments seems like Liberal Democrat pedantry; it would leave out a superfluous ''or'', which is precisely the sort of thing that the Liberal Democrats come up with all the time.

Schedule 10 makes provision for the tax consequences of the assorted transfer schemes. Part 1 deals with transfers under clause 1 of the Bill from the SRA and other publicly owned bodies to the national authority. The purpose of part 1 is to deal with the tax consequences of a transfer to a public body, which is not liable to corporation tax. The schedule was drafted on the assumption that the potential transferees in this category would be the Secretary of State, Scottish Ministers and the National Assembly for Wales. That is no longer correct, as the potential transferees include the Office of Rail Regulation, which is also a public body that is not liable to corporation tax. The amendments correct that position, and the ORR is included in the definition of a national authority so that the appropriate tax consequences in part 1 will apply. It is an entirely technical amendment and I commend it to the Committee.

Amendment agreed to.

Amendment made: No. 121, in page 125, line 33, at end insert

(d) the Office of Rail Regulation;'.

Schedule 10, as amended, agreed to.

Clause 53 - Further amendments of the 1993 Act

Greg Knight (Conservative, East Yorkshire)

Will the Minister inform the Committee, for the record, what the effect would be if the clause were omitted from the Bill?

Tony McNulty (Labour, Harrow East)

In essence, clause 53(1) amends the Railways Act 1993 so that for the purposes of the two relevant sections the term ''railway'' is given its wider meaning. That wider meaning is contained in section 81(2) of the 1993 Act and covers a railway, tramway or transport system that uses another mode of guided transport, but not a trolley vehicle system.

Section 118 of the 1993 Act provides a power for the Secretary of State to give direction in relation to the control of railways in times of hostilities, severe international tension or great national emergency. Section 119 provides a power to the Secretary of State to give instructions to railway operators for the purpose of ensuring that relevant assets,or persons or property on or in such assets are protected against acts of violence. Clause 53(1) will enable a consistent approach to be taken across all sectors of the rail system in times of emergency and allow implementation of transport security measures. At present, the narrow definition of railways applying to those sections means that although it covers the main rail network and some light rail systems, other light rail systems, such as trams, fall outside the definition.

The clause contains enabling powers only; the emergency provisions are needed only for times of extreme concern, and as and when such an approach might be needed, God forbid, it would be inappropriate if it covered only heavy rail and some light rail under the narrow definition, but not light rail or trams, especially given the expansion of light rail systems in the UK in recent years. Clause 53(2) gives effect to schedule 11, which introduces miscellaneous amendments to the 1993 Act. Many of those amendments relate to the revised procedures for network modifications put in place by part 4 of the Bill.

In the broadest sense, the clause therefore widens the definition of rail to include other developments that have occurred since 1993.

Greg Knight (Conservative, East Yorkshire)

We are grateful to the Minister. He has confirmed what we thought was the case, and we are content.

Clause 53 ordered to stand part of the Bill.

Schedule 11 - Miscellaneous Amendments of 1993 Act

Tony McNulty (Labour, Harrow East)

I beg to move amendment No. 122, in page 130, line 43, leave out ''of his or theirs'' and insert

'or activity of his, theirs or its'.

Again, this is a technical amendment to section 80 of the 1993 Act, to ensure consistency with clause 50, which requires the ORR to comply with reasonable requirements of the Secretary of State and the Scottish Ministers to provide information or advice about matters connected with its activities, and its functions related to railways or railway services. It removes any doubt that section 80 might be restricted to only statutory functions. Broadly, therefore, it covers the broadening of what the ORR needs to do to comply with reasonable requirements in terms of information for the Secretary of State and Scottish Ministers. It is therefore an entirely technical amendment.

Amendment agreed to.

Question proposed, That this schedule, as amended, be the Eleventh schedule to the Bill.

Greg Knight (Conservative, East Yorkshire)

May I ask the Minister a question about paragraph 13 of the schedule, on page 131? It refers to

''Competent authority status for the purposes of grants and loans under EU regulations.''

In what circumstances does he envisage the UK railway network receiving a grant or loan under European Union regulations?

Tony McNulty (Labour, Harrow East)

I do not know anything about the specifics of such a circumstance. Paragraph 13 simply amends section 136 of the 1993 Act by adding the Scottish Ministers and the National Assembly for Wales as competent authorities for various functions, and it also amends the powers of the passenger transport executive to act as a competent authority.

Under sub-paragraph (1), the Scottish Ministers become an additional competent authority for the purpose of the railway financial status regulations, which, as everyone will know, are contained in Council regulation (EEC) No. 1192/69 on common rules with respect to the financial status of railway undertakings. As I understand it, that is about their receiving competent authority status in terms of assorted things such as state aid and assisting the railway network, rather than simply about being the recipient of funding from the EU.

Under the subsequent paragraphs of the schedule, Scottish Ministers and the National Assembly for Wales become additional competent authorities for the purposes of the public service obligations regulations—Council regulation (EEC) No. 1191/69 on public service obligations in transport, as amended by Council regulation (EEC) No. 1893/91, as everyone will know. That is about reflecting the additional functions afforded to the Assembly and the Scottish Parliament in accordance with the powers and functions afforded to the Secretary of State in the 1993 Act. It reflects the devolution position that prevails in relation to this Bill, as opposed to the 1993 Act.

Question put and agreed to.

Schedule 11, as amended, agreed to.

Clause 54 ordered to stand part of the Bill.

Clause 55 - Powers exercisable by statutory instrument

Christopher Chope (Conservative, Christchurch)

The clause gives the Secretary of State enormous power, using the statutory instrument process, to dictate and develop railways policy. This short debate gives the Minister an opportunity to share with us his intentions as regards keeping people informed of Government policy on the railways. I raise that point in the light of comments made yesterday in the other place. In a short debate on the rail network, Lord Davies of Oldham, responding on behalf of the Government, said that

''the Government support continued growth in the use of the railway network by making the best use of existing capacity through measures such as route utilisation strategies and ensuring that the railway operates as efficiently as possible.

We also need to plan for the long term, when increased capacity may be needed. My right honourable friend the Secretary of State for Transport hopes to make an announcement soon on the Government's thinking on future strategy for the network.''—[Official Report, House of Lords, 17 January 2005, vol. 668, c. 536.]

I was surprised to find that announcement being flagged up in the other place yesterday. If the Secretary of State is preparing a major announcement on the future strategy for the network, why is he not sharing that information with the members of this Committee? Perhaps the Minister can tell us when the announcement is due and why it has not been made already, and flag up anything significant that he expects it to contain. It is one thing for the Committee and the House to give the Government more statutory instrument powers that will in effect never be debated, but it is extraordinary that they are cooking up a major announcement on the railway network without the Standing Committee on this Bill having the opportunity to discuss that.

Tony McNulty (Labour, Harrow East)

With your indulgence, Mr. Amess, I shall stick to clause 55 rather than go off on tangents, as the hon. Gentleman is wont to do.

The purpose of the clause is simply to identify which powers in the Bill are exercisable by statutory instrument. It sets out the manner in which the Secretary of State and Scottish Ministers must exercise their powers under the Bill to make orders and regulations—in an entirely appropriate and fit manner, as befits the customs, protocols and procedures of the House of Commons. The clause sets out the parliamentary procedures that shall apply to negative resolution and affirmative resolution statutory instruments. If, as I suspect, we are still locked into the notion that the Opposition are so ineffective that they cannot ensure effective scrutiny of statutory instruments, whether they are subject to the affirmative or negative procedure, that is a sad matter for the country and for Opposition Members.

There is no secret agenda, and there is no separate, draconian set of measures. The measure is entirely appropriate, considering how the House conducts its business, under whichever party. That is all that clause 55 is about. Today's flights of fancy on the part of the hon. Member for Christchurch (Mr. Chope) had the merit of not being numerous, those of his colleagues were in our previous sitting. None the less, they are entirely that—flights of fancy. Clause 55 is about this Government and this House doing our business in the way in which we have always done it.

Greg Knight (Conservative, East Yorkshire)

We are grateful to hear the Minister say that there is no secret agenda. Will he confirm that there is also likely to be no treating with contempt? My hon. Friend the Member for Christchurch and I raised, en passant, the comments made by the Minister in the other place, who said that

''the Secretary of State for Transport hopes to make an announcement soon on the Government's thinking on future strategy for the network.''—[Official Report, House of Lords, 17 January 2005; Vol. 668, c. 536.]

In referring to the network, he meant the railway network. Will the Minister confirm that any such announcement will be made to this House and not to the media out there?

Tony McNulty (Labour, Harrow East)

If hope turns into triumph and the Secretary of State makes such a statement, it will be made in the proper manner, at the proper time and in the proper place: at the Dispatch Box on the Government side of the House of Commons. If the hon. Member for Christchurch wants to have a go at speaking there, now or in the years ahead, I am more than happy to facilitate that for him, because I am sure that the people of this country will not do so.

Clause 55 ordered to stand part of the Bill.

Clause 56 ordered to stand part of the Bill.

Clause 57 - General interpretation

Tony McNulty (Labour, Harrow East)

I beg to move, That the clause stand part of the Bill.

I was tardy. I wanted to jump up on the previous clause, purely to make the point that, once again, we are not blessed by the presence of Plaid Cymru in considering important aspects of the Bill relating to Wales and the National Assembly for Wales. We have not been blessed by any such presence for some time. With its partners in that extreme nationalist group, the Scottish National party, Plaid Cymru fought like billy-o to get on to the Committee, but it has not since troubled us with its presence.

Greg Knight (Conservative, East Yorkshire)

The Minister and I do not agree on much, but we agree on a few things. We share his disgust in this area.

John Thurso (Liberal Democrat, Caithness, Sutherland and Easter Ross)

Let us have an all-party consensus.

Question accordingly agreed to.

Clause 57 ordered to stand part of the Bill.

Clause 58 ordered to stand part of the Bill.

Schedule 12 - Other minor and consequential amendments

George Howarth (Labour, Knowsley North and Sefton East)

I beg to move amendment No. 131, in page 133, line 18, at end insert

'(1A) In section 10(1) (general powers of Executive)—

(a) in paragraph (xiv), after ''purchase,'', insert ''lease,'';

(b) in paragraph (xvi), after ''transfer'', insert ''or the letting on hire''; and

(c) in paragraph (xxxii), at the end, insert ''or the business of any person with whom they have entered into an agreement under paragraph (xv) of this subsection for the carrying on by that person of any activities.'.

Sir David Amess (Conservative, Southend West)

With this it will be convenient to discuss the following amendments: No. 132, in page 135, line 4, at end insert

'Local Government Act 1988 (c. 9)

9A In section 17 of the Local Government Act 1988 (local and other public authority contracts: exclusion of non-commercial considerations), in paragraph (a) of subsection (5), at the end insert ''except in the case of contracts entered into or contemplated by any Passenger Transport Executive for a passenger transport area in England''.'.

No. 133, in page 136, line 16, at end insert

'Local Government (Contracts) Act 1997 (c. 65)

13A In section 1(3) of the Local Government (Contracts) Act 1997, (functions to include power to enter into contracts), in subsection (3), at the end insert—

''(e) any Passenger Transport Executive for a passenger transport area in England within the meaning of Part 2 of the Transport Act 1968.''.'.

George Howarth (Labour, Knowsley North and Sefton East)

The amendments aim to facilitate vertical integration or full local decision making. With your indulgence, Mr. Amess, I will spend some time describing what I mean by that, because a later new clause and new schedule deal with the same subject, and it will save me repeating my remarks.

The Railways Act 1993 privatised the UK rail network. Before privatisation, the railways were, as we know, owned and operated as a single entity under British Rail. Although partly funded by passenger fares, British Rail was, as we again know, heavily subsidised by the taxpayer. The Government of the time decided that breaking up the network into business units was the best way forward.

We know the consequences of that approach: it set up a blame culture. It was not always clear who was responsible for what, and difficulties arose that this Government had to address. The main way in which the Government have addressed those difficulties is by abolishing Railtrack, and they have taken a series of other steps to try to resolve the problems that have arisen on the railways since privatisation. However, those steps have not included, as a universal solution, the concept of vertical integration. By that, I mean the reintegration of the infrastructure—track, signals, stations, crossings and power lines—with the operations: trains, passengers and freight services.

Merseyrail, which covers my constituency, is unique in the United Kingdom in that it is detached from the national rail network because of the underground and the third rail electric traction system. In July 2003, in recognition of that fact, Merseytravel took from the SRA control of managing the train operating company on the Merseyrail network and operating rights were granted to the private sector for a 25-year term. Since then, Merseyrail has gone from being the worst performing train operator in the UK to the best performing one on the UK mainline. Even so, the system on Merseyside remains fragmented; the train company, Merseyrail, and the track owner and operator, Network Rail, are separate businesses. Although those two companies are delivering a far better service than ever before, we believe that there is significant room for improvement.

That is what we want to achieve, and the amendments go some way towards doing it. I shall go through each in turn. Amendment No. 131 would help to clarify the powers of passenger transport executives in relation to railways more generally. Although the PTEs have been able to rely on some general and implied powers in the past, a key point is that it is difficult to persuade institutional lenders to support financial transactions by public authorities for which there is no express statutory power. The amendment would provide express statutory powers where I believe there is currently ambiguity, and it would make possible the sorts of arrangement with institutional lenders that Merseyrail has entered into in the past and would hope to enter into in future.

Amendment No. 132 seeks to put passenger transport executives in the same position as best value authorities, which can take into account the terms and conditions of employment offered by contractors in awarding contracts. That is needed because local authorities and other public authorities, including passenger transport executives, were precluded by section 17 of the Local Government Act 1988 from taking certain matters into account, including the terms and conditions of employment operated by contractors in awarding contracts for work, services or supplies. Although best value authorities are now excluded from this requirement for contracts that involve transfers of staff or where they consider it necessary or expedient to disregard it, in performing their best value functions, PTEs do not fall within the category of best value authorities. It would be helpful if they could be included in that category.

Amendment No. 133 would put PTEs in the same position as local authorities, which can certify that a contract entered into them is within their powers. That would put investment in PTE-promoted projects on an even footing with investment in local authority-promoted projects, which is needed if the necessary changes and improvements are to be made.

Merseytravel—and, within that, Merseyrail—is an ambitious authority. It is undertaking a number of new developments, not least the extension of the electrification of the network into Headbolt Lane in my constituency and, beyond that, possibly into west Lancashire, outside its own boundaries. I know that the hon. Member for Southport (Dr. Pugh) has some interest in that development. The same applies on the Wirral, where Merseytravel will possibly extend the electrification of local services into Ellesmere Port, which is without Merseyside and in Cheshire. Those developments would be popular not only in Merseyside, but elsewhere. Merseytravel's powers must be properly clarified, so that the new developments can go ahead on a sound and proper legal basis. I shall say more about that later when I speak to my new clause.

I know that my hon. Friend the Minister and those who advise him believe that the proposed powers already exist, and he will probably say that my amendments are otiose, to use the fashionable term. I can only say that Neil Scales, the chief executive and director general of Merseytravel, whom he holds in high regard, as I do, believes that they are necessary, and there may be some disagreement with his officials and those who are having to carry out the work. In a sense, I am trying to probe that situation. If that is the case and that disagreement remains, I ask my hon. Friend to reflect further. I know that he shares our great ambitions for Merseytravel and Merseyrail and I am sure that he would not want to deny them the proper powers to achieve those ambitions. If he rejects the amendments today, I hope that he will reflect carefully before Report on how he can ensure that the powers that we need exist.

John Pugh (Liberal Democrat, Southport)

I want to speak in support of the spirit if not the detail of the amendments tabled by the hon. Member for Knowsley, North and Sefton, East (Mr. Howarth). Vertical integration has long been a plea of the Select Committee on Transport, which has mentioned it several times as a desirable objective, almost in the sense of getting back to the reunification of track and wheel. In a previous part of my parliamentary career, I listened to Minister after Minister in that Select Committee explaining why such integration was not a good thing and was not possible, practical or financially viable.

None the less, an element of vertical integration must surely be a good thing and I want to give a small illustration to show why. I shall choose the same local body, the Merseyside passenger transport authority, to illustrate the point. The hon. Member for Knowsley, North and Sefton, East is right to say that the Merseyside PTE is an ambitious authority, but it fulfils some good and worthwhile ambitions. I include in that the extension and improvement of the network, particularly in areas such as Burscough, which will have an enormous effect on my constituency in west Lancashire and on the viability of the whole rail system in that area. To do that, the PTE needs amendments of the same ilk as those tabled by the hon. Gentleman to carry the day.

I want to give a small but from my point of view poignant example to show why vertical integration is such a good thing by referring to a small issue in my constituency. We talked in a previous sitting about level crossings. In the Merseyside PTE the level crossings are run by Network Rail. The rail service is a franchise of the Merseyside passenger transport authority. In my constituency, there is a series of automatic barriers that go down consecutively. Any day of the week—I am sure that it is happening as I speak—one can witness huge queues of traffic waiting an inordinate amount of time for the barriers to rise.

One of the considerations about any system that is put in place and the complexities thereof is safety, but a key factor in the situation to which I am referring is that Network Rail simply does not want to be penalised for holding up the trains, and unreasonable effects on the transport system result. Taxi drivers, buses and people who have no intention of getting the train are kept waiting in long queues in front of level crossings simply because two different companies stand in an odd, unsatisfactory relationship with one another.

There is a big social divide in Southport. A railway line goes right through the middle of the area, and people's social position is determined by which side of the tracks they live. Kenny Dalglish lives on the right side of the tracks, whereas someone who is not so well off would live on the other side. Being a Liberal Democrat, I live more or less on the tracks. I observe them from my front window.

I can vouch for the entirely negative consequences of the lack of vertical integration in the case that I just described, which involves a unique rail system that offers an almost classic case that the Government could act on if they were considering introducing a pilot to see how such an approach would work.

Tony McNulty (Labour, Harrow East)

I am grateful to my hon. Friend the Member for Knowsley, North and Sefton, East for explaining the points that his amendment seeks to address—the propositions that PTEs should have more explicit rights to lease and sub-lease assets and that local government legislation should be amended to put PTEs on a more equal footing with local authorities. I understand his motivation in respect of the possible transfer of responsibility for the operation, maintenance and renewal of rail infrastructure, given that he referred to the unique case of Merseytravel in Merseyside. Of course, the Bill refers more generically to PTEs; were it simply to pursue a matter for an individual organisation, it would be doomed on the altar of hybridity.

I would not demur from what my hon. Friend says about the efficacy or efficiency of Neil Scales as chief executive or about the ambition of Merseytravel to take matters forward in its specific area. Therefore, although I have some sympathy with his amendments, I do not think that they are necessary for any possible Merseyrail transfer or for the general day-to-day operation of the PTEs.

In one sense, this is a matter of force and clarity. By its own lights, Merseytravel would say that the amendments are not absolutely necessary, but in the next breath, it would say that they would add greater clarity and allow for a smoother, more clean-cut legislative framework in which to work. None the less, Neil and others suggest that the amendments are not absolutely essential. This is not an either/or matter, but a matter of degree in the middle.

Although the amendments are grouped, with your indulgence, Mr. Amess, I shall speak to them one by one. Merseytravel and the other PTEs have general powers, which are set out in the Transport Act 1968, to do many things in their local passenger transport areas. There are specific, detailed powers and more general, catch-all powers. I understand that PTEs have been able to lease assets in reliance on those powers. As I said, I am confident, as is Merseytravel, that the powers can be used successfully to transfer responsibility for the infrastructure to Merseytravel. It is therefore unnecessary to include an explicit provision for leasing when a general provision is currently used satisfactorily for the same purpose. I do not know whether the amendment is otiose, but I certainly do not consider that it is absolutely essential for Merseytravel to do what it needs to do.

I understand my hon. Friend's desire to reduce any risk that might come from the lack of clarity over Merseytravel's right to lease and the possible impact that that could have on its ability, or that of any PTE—let us stick to generic terms—to borrow from institutional lenders to invest in the rail network if it is transferred to it. PTEs have managed to lease accommodation assets under the powers of the 1968 Act before now and it is my understanding, from Merseytravel and others, that additional powers are not required for the transaction to go ahead. If at any stage in the immediate future, even during consideration of the Bill, Mr. Scales or any other chief executive of a PTE, or a group of PTEs, wants to seek further guidance on those aspects of the law, or to discuss in wider terms any difficulties or hindrances that they encounter, I will be more than happy to meet them.

I am sympathetic to the thrust of amendment No. 132, which would allow PTEs to take into account terms and conditions of employment for staff, but I am concerned that the Bill is not the best or most appropriate place for the issue to be considered. The amendment that my hon. Friend proposes is too wide in its implications. I am aware that best value authorities, which include PTAs but not PTEs, are to consider the terms and conditions of contractors where that contributes to best value, or for transfers made under the Transfer of Undertakings (Protection of Employment) Regulations 1981, but my hon. Friend's amendment goes wider than that. His amendment does not require the consideration to contribute to best value. It goes further than simply allowing PTEs to take into account best value and TUPE when letting contracts. It would mean that a PTE, in letting any public supply or works contract, may consider any aspect of the terms and conditions of employment by contractors or workers in coming to its decisions. Far be it from me to defend the Local Government Act 1988, but I do not think that the Bill is the best place to discuss the issue of broader local government procurement.

Turning to amendment No. 133, the Local Government (Contracts) Act 1997 covers the powers possessed by local authorities to enter into contracts, limits the scope of legal challenge of such contracts and protects companies that have entered into a contract in the event of it being ruled unlawful. It applies only to bodies defined as local authorities for the purposes of the local government capital finance system. PTEs do not fall under that definition, although PTAs do. PTEs are governed by a different legal regime to PTAs and other local authorities, and it would therefore not be practicable to include them in the terms of the 1997 Act. The amendment would also set an unhelpful precedent and blur the demarcation between the elected body—the PTA—and its executive arm.

I understand what Merseytravel and other PTEs wish to do—although I take on board my hon. Friend's point about the unique situation of Merseytravel. I do not think that Merseytravel or any other PTE requires the amendments to move in such a direction. Even if they did, the amendments have other consequences for the relationship between PTEs and PTAs, and for the broader body of local government statute—not all of which I am aware of because I have not considered the matter in sufficient detail. They would pull PTEs out of the generic family and treat them as democratic bodies rather than executive ones under the Local Government (Contracts) Act. I accept that the amendments may give a greater degree of clarity for the specific purpose of the example that we are using—what Merseytravel may want to do as a PTE—but in the broader sweep of law, it will add as much confusion and lack of clarity as the clarity it introduces to that narrow area.

I am sympathetic to what Merseytravel seeks to do; I am certainly signed up to what it represents in terms of leadership and ambition. I am more than happy to meet its representatives before Report or at any other stage. In fact, I am seeing Mr. Scales this Thursday—certainly one Thursday, I think in January—and I can discuss this further with him.

If in the context of their relationship to PTAs and local government legislation the PTEs as a group need discussion and reflection to allow them to do what they want in the broad context of their local policies, as well as the Government's national strategic transport policy, I more than happy to meet them on any number of occasions. However, in the context of schedule 12, the amendments are not appropriate and I ask my hon. Friend, in all humility, solidarity and fraternity, to withdraw his amendment.

George Howarth (Labour, Knowsley North and Sefton East)

How could one resist such an invitation? Of course I am willing to withdraw the amendment. I run the slight risk of applying for the job of the Minister's diary secretary, but I can confirm that he has a meeting with Mr. Neil Scales on Thursday. No doubt these matters will be discussed. I am also grateful for the fact that the Minister has offered to meet a delegation from Merseytravel—and perhaps a slightly wider group; we will reflect on that—before Report.

There is a friendly disagreement between the Minister, and Merseytravel and Merseyrail. Merseytravel believes that it has serious problems in convincing funding bodies, in particular, that the legal requirements necessary for it to enter into the arrangements that it would like are sufficiently clear to enable those transactions to go ahead. That is a serious problem, and one with which people who are trying to do things that the Minister and I approve of are confronted. I hope that at some point—by means of a statement from the Minister, perhaps before the conclusion of today's business, or from the Secretary of State when the Bill returns to the Floor of the House—there will be clarification of some of the problems that people are experiencing. However, knowing the Minister's willingness to continue to engage with this issue, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Tony McNulty (Labour, Harrow East)

I beg to move amendment No. 123, page 134, line 40, leave out from 'from' to 'under' in line 41 and insert

'''with'' onwards substitute ''entered into, where a railway service has been temporarily interrupted, with the Secretary of State, the Scottish Ministers or the National Assembly for Wales'.

Paragraph 8 of schedule 12 replaces the existing reference with that to agreements with the Secretary of State entered into under clause 40. However, it is defective in two respects. First, it would exempt from the registration requirement not only bus services replacing temporarily disrupted rail services, but those replacing permanently discontinued services, which goes further than the current provision and was not our intention. The amendment corrects that defect in our drafting. Secondly, the paragraph refers only to agreements with the Secretary of State, whereas clause 40 also covers agreements with Scottish Ministers and the National Assembly for Wales. This technical amendment corrects that lacuna, as well.

Amendment agreed to.

Tony McNulty (Labour, Harrow East)

I beg to move amendment No. 124, page 136, line 19, leave out from 'section' to 'for' in line 20 and insert

'175 (co-operation between Transport for London and the Secretary of State)—

(a) in subsection (1)(a)(ii),'.

Sir David Amess (Conservative, Southend West)

With this it will be convenient to discuss Government amendment No. 125.

Tony McNulty (Labour, Harrow East)

Again, these are technical amendments and they are linked. They concern schedule 12, which makes minor and consequential amendments to existing legislation—in this case, section 175 of the Greater London Authority Act 1999, which concerns co-operation between Transport for London and the Secretary of State.

Amendment No. 125 ensures that all references in that section of the Greater London Authority Act to the closure provisions in the 1993 Act, which are all being repealed, are correctly replaced with references to the provisions of this Bill that will take their place. Hon. Members will remember that, for London, we sought to leave the provisions of the 1993 Act on the relationship with the London Transport Users Committee and the Greater London authority in place. We have repealed en bloc all the elements of the 1993 Act that referred simply to the Strategic Rail Authority and the Rail Passengers Council that was. Having repealed those elements, we need to reinstate all references to the status quo configuration in London. We have done that in part, but the amendment does it in more detail, and will correct or replace all references to the provisions of this Bill.

Amendment No. 124 simply corrects the drafting as a result of that. It was overlooked when the Bill was drafted, and the amendment addresses that oversight.

Amendment agreed to.

Amendment made: No. 125, page 136, line 22, at end insert 'and

(b) in subsection (3)(b), for ''sections 37 and 38 of that Act'' substitute ''sections 22 to 24 of the Railways Act 2005''.'. —[Mr. McNulty.]

Schedule 12, as amended, agreed to.

Schedule 13 - Repeals

New Clause 1 - Heritage trains (exemption)

Greg Knight (Conservative, East Yorkshire)

I beg to move, That the clause be read a Second time.

I wonder what the Minister thinks of if I say Little Bytham. It is not a character from a Catherine Cookson novel; nor is it the name of the research assistant of the hon. Member for Cardiff, West (Kevin Brennan). It is in fact the name of a village that is famous among railway enthusiasts the world over. It is situated around a grand Victorian viaduct that carries the main east coast line between London and Scotland, and it was on that particular stretch of track between Grantham and Peterborough on Sunday 3 July 1938 that LNER locomotive No. 4468, hauling seven coaches weighing 240 tonnes, achieved the highest speed ever ratified for a steam locomotive: 126 mph—126 mph in 1938. I wish the train that I regularly use in 2005 could match that. The driver was Joseph Duddington; the fireman, Thomas Bray; and the engine, for reasons that I have not been able to ascertain, was named after a duck. Some duck!

The Mallard, even today, remains the fastest steam locomotive in the world. The engine is part of our national heritage and has happily, together with many others, been preserved for posterity. Many people want to see and continue to see that engine used at full steam from time to time on our railway network. The Mallard is not the only locomotive still able to traverse the country; many others do, and they should continue to be allowed to do so.

On 11 June 2002, Her Majesty the Queen began her jubilee tour of Wales at the village with the longest place name in the UK. I was hoping to have some assistance from the Welsh members of the Committee—if not the hon. Member for Ceredigion (Mr. Thomas), perhaps the hon. Member for Ynys Mon (Albert Owen). I will not attempt to pronounce that Welsh name, which runs to 58 letters, but I have had it translated, and it apparently means the Church of St. Mary in the Hollow of the White Hazel near the Rapid Whirlpool and the Church of St. Tysilio near a Red Cave. Perhaps I should call it Llanfair PG, which is the Welsh abbreviation.

The village is on the island of Anglesey in north Wales. It was the first village to greet the Queen and Prince Philip on the first day of their Welsh tour. They arrived on the royal train, which had been pulled from Holyhead to its destination by an historic steam locomotive, the Duchess of Sutherland. A crowd of 1,000 gathered to welcome not only the Queen but that piece of famous railway history. After touring Wales, the Duchess of Sutherland pulled the Queen to Llandudno. The Queen and Prince Philip spent the night on the royal train.

The Duchess of Sutherland was built for the London Midland and Scottish Railway in 1938. The 67-year-old steam engine had the royal crown headboard attached to its front in honour of the trip. The locomotive had been restored for three years, with most of the work carried out by volunteer enthusiasts. The presence of a steam locomotive had special significance, because the date marked the 160th anniversary of the first royal journey by train, when Queen Victoria travelled from Slough to Paddington.

Those two glorious locomotives, and many others that are still in working order, are part of our heritage. They provide pleasure to millions of people. We are concerned that they may be consigned to the museum shed for good under new proposals that are being considered. The proposals do not come from our Head of State, who was delighted to be a passenger in a train pulled by steam traction, and neither, I am sure, do they come from the Minister, who I hope takes my view that heritage train journeys should be encouraged. They are, in effect, living history.

I understand, however, that those proposals will require all locomotive units operating on the network to have an electronic recorder fitted. While we all applaud the ongoing quest for greater safety, I argue that changes need to be implemented with a degree of common sense. The cost of a train equivalent of an aircraft black box is likely to be in excess of £30,000 per steam locomotive, because steam locomotives were not designed to take electronic equipment.

Is there any public demand for the proposals? Has the Minister received any letters from the public saying that they are worried about their safety when they travel on special excursion trains pulled by steam engines? I doubt it. Common sense should prevail. I hope that he will reassure me that those who are considering the issue of safety will be sympathetic to the need to ensure that we do not prevent historic locomotives from running on the network. I hope that those who are charged with the duty are not regulation-ridden, form-filling pen pushers who will impose a blanket duty for all locomotives to have the new equipment.

Sir David Amess (Conservative, Southend West)

Before I call the Clerk to read the title of the new clause, I shall quote ''Erskine May'' for the record:

''Her Majesty cannot be supposed to have a private opinion''.

Tom Harris (Labour, Glasgow Cathcart)

I know that there is a history in Standing Committee of Members saying that they will speak briefly and then still speaking for 30 minutes, but my inquiry could probably have been made as an intervention. Nevertheless, I hope that the right hon. Member for East Yorkshire (Mr. Knight) will forgive me for making a slightly longer contribution.

I am sympathetic to the spirit of the new clause. It is a matter of some personal regret that when I was first ever a passenger on any rail service, the steam era had passed. In fact, it was a shock to my mother when she took me from Glengarnock to Ardrossan one Christmas. It was the first time that she had been on a train for many years—I think it was the first time in her married life—and she was shocked and saddened when the diesel train arrived. Even then, she had expected it to be a steam train. I will not quote the year, because I am quite sure that it was many years past the steam train era.

I am sure that many people, for various reasons, will hope that the heritage rail system in this country will continue to flourish as it has done over past years, but the question that I hope the right hon. Member for East Yorkshire will respond to is a technical inquiry. New clause 1 states:

''Any steam locomotive . . . shall be exempt from any . . . future requirement.''

I find that wording odd. I am not a lawyer, and like my hon. Friend the Minister, I am quite happy about that. Furthermore, many hon. Members who are present have much more experience in this place than I do. I would have thought, however, that it was out of order and technically suspect for this House to pass any measure saying explicitly that no future legislation shall supersede it. Surely, it is the right of any new Government to introduce legislation that, by its nature, will supersede previous legislation. I would have thought that it would be very difficult or even impossible for the Committee or the main Chamber of the House to pass any legislation saying that no future government shall pass any legislation that supersedes it. I am sympathetic to what is proposed, but I would have thought that that alone suggested that this Committee should not support the new clause.

John Thurso (Liberal Democrat, Caithness, Sutherland and Easter Ross)

Notwithstanding the potential technical defect that the hon. Member for Glasgow, Cathcart (Mr. Harris) has raised, I have great sympathy with the thrust of this amendment that the right hon. Member for East Yorkshire has tabled—a view that I hold for two reasons.

The right hon. Member for East Yorkshire said that the Duchess of Sutherland had pulled the Queen, which is an interesting choice of words. Perhaps it would be better to say that the locomotive the Duchess of Sutherland had pulled the Queen. There is a proposal to have an infrequent service by steam train from Tain to Dunrobin for tourism purposes. The locomotive that those involved are hoping to use is the Duke of Sutherland's personal steam locomotive, which is currently used by the governor of a South American region—I think in Bolivia—as his personal locomotive. It is hoped that it will be rescued, and brought back and used for that purpose. Clearly it is a locomotive that, having been built at some point in the early part of the last century and having been restored, will not be able to take the kind of equipment that is referred to without great further expense. That type of innovative tourism project might be stymied by the legislation.

I hope that the Minister will at least consider the spirit behind the new clause, even it is found to be technically deficient in this form.

Tony McNulty (Labour, Harrow East)

I am happy to consider the spirit and sentiment behind the new clause, and I have some sympathy with the broad sweep of the point made by the right hon. Member for East Yorkshire. I had the great pleasure—I cannot remember when, and I was going to seek assistance from my hon. Friend the Member for Knowsley, North and Sefton, East, as my new diary secretary, but I suspect that he does not know either—of assisting in opening a new section of dual track in Cornwall, between Probus and Burngullow. We went between the two events on the City of Truro steam locomotive, which was leading a heritage carriage, rather than a regular set of carriages. When we got to our destination, I had the great pleasure of naming a high-speed train after the City of Truro steam train, so as and when that steam train finishes its existence, its life will carry on in the form of the new train.

The right hon. Gentleman and members of the Committee will know that not all but many of the steam locomotives that are used do not go terribly fast. I have not heard of any locomotive on the Bluebell or Lavender lines getting up to 125mph or 130 mph. They would be in trouble if they did. The Rail Safety and Standards Board thinks it appropriate that there should be data recorders in steam locomotives. That is a matter for the RSSB under statute, not us. Data recording will be limited in value, because modern-day black boxes on trains work through software and capture all sorts of electronic data via the construction of the new locomotives. Their value on steam trains will lie in recording speed, utilisation of brakes and whether the warning system works.

First, the way in which things are configured means that it is not for us to impose on the industry a separate safety standard outwith the process. Secondly, if the RSSB moves in that direction, it would be far more appropriate for many steam locomotives to seek derogation from using the data box on the basis of their speed. We can consider that issue in more detail, but it should exempt many of locomotives from what, given their limited use and seasonal value, may well be an undue burden and encumbrance along the lines of the regulatory pen-pushers to which the right hon. Gentleman referred. Derogation on speed rather than number of days on the network would be more appropriate.

On balance, I will go with the RSSB, because it does not matter if a steam locomotive is on the network for one day, 56 days or 60 days. If it is capable of and intended for travel at high speed, that speed should govern the safety regime that prevails, rather than the fact that it is travelling only one or two days a year.

Greg Knight (Conservative, East Yorkshire)

Is the Minister saying that steam engines that are fitted with a data recorder will be exempt from the speed limits that are in force on the network?

Tony McNulty (Labour, Harrow East)

No, absolutely not. I am turning it around the other way and saying that, if a steam locomotive will never be on those parts of the line on which trains run at high speeds, it may well be appropriate for the operator to seek a derogation from using a data box in the first place. I do not know all the details, but I think that that would cover far more of the steam engines currently in operation, including those on the Lavender and Bluebell lines and the City of Truro steam locomotive, than it would if we used the number of days limit, which is not appropriate.

If the driver of a steam locomotive intends to repeat the Mallard journey and get up to 125 mph, even if on only one day a year, a different safety regime should prevail than the one that would apply to another engine that never goes above 25 or 30 mph for 60 days a year in high season. That would include the recording of as much data as possible, and heaven forfend that there should be an accident. I would understand why an operator might seek a derogation from the RSSB on any standard that imposed the use of a data box in all circumstances. I would be sympathetic to that response.

So I am with the right hon. Gentleman that far, but speed rather than simply the number of days on the network should be the governing criterion for safety. In addition, it is for the RSSB and the industry working with the Health and Safety Executive and the Health and Safety Commission to determine what the rail safety standards should be, rather than us setting that out in statute.

As the current safety regulator, the HSE and HSC have no proposals to make regulations under the Health and Safety at Work etc. Act 1974 to require the fitment of data recorders or similar devices; nor are they aware of any other proposed rail safety legislation that might involve data recorders. The RSSB is certainly considering the matter, as the right hon. Gentleman suggested. I would be more than sympathetic to a suggestion that, collectively—on some cross-party basis—we ask the RSSB for a derogation, based on speed, for all the reasons of heritage, culture and tourism that the right hon. Gentleman and others have suggested.

Speed should govern the safety regime, regardless of whether the locomotive is on the network for one, 56 or 106 days. In that context, although I have strong sympathy with what the right hon. Gentleman is trying to do, I suggest that the new clause is inappropriate and ask him to withdraw the motion. Perhaps we might subsequently talk across the Committee about interacting with the RSSB to consider this issue and seek a derogation in the broader sense.

Greg Knight (Conservative, East Yorkshire)

We have had a very interesting debate, and I am grateful to all hon. Members who took part. On the comments of the hon. Member for Glasgow, Cathcart, I do not think that there is anything unique about the new clause. It merely seeks to exempt steam engines from any current, pending or future requirement to have a black box. That does not mean that, if it were added to the Bill, it would not be possible for a future Parliament to repeal it. No Parliament can bind its successors. We all know that, so his point was not valid.

I am also grateful to the Minister for his sympathy with, and understanding of, the problems that a heavy hand could cause for those who operate steam trains. Such an approach could lead to the cessation of steam engines running on the main line, which I believe no member of this Committee would want.

Motion and clause, by leave, withdrawn.

New Clause 2 - Awareness of vulnerable passengers

John Thurso (Liberal Democrat, Caithness, Sutherland and Easter Ross)

I beg to move, That the clause be read a Second time.

The wording of the new clause is fairly self-explanatory, but it may help the Committee if I outline the background. It relates to a case that was brought to the attention of my hon. Friend the Member for Carshalton and Wallington (Tom Brake) concerning Janice Norman. Ms Norman was travelling on a crowded commuter train when she was 25 weeks pregnant. No one got up to give her their seat or to make any accommodation for the state she was in. During the journey, an inconsiderate fellow traveller barged past her with such force that he pushed her quite hard in the stomach. Some five weeks later, when she was 30 weeks pregnant, her baby was born by caesarean section after it stopped kicking but, tragically, died after complications set in.

In the light of the circumstances, a post mortem was requested and it was established that the baby had suffered a trauma at 25 weeks, at the same time when Ms Norman had been hit while travelling on the train. The midwife told her—Ms Norman subsequently verified the information from other sources—that quite a lot miscarriages happen after similar accidents on public transport. One of the problems is that, unfortunately, no statistics are kept and the accidents are not widely known about or reported, largely because when miscarriages happen the people to whom they happen are thinking not about the consequences to public transport, but about their own grief. Such accidents are not reported in a way that information about them can be collected.

Ms Norman contacted my hon. Friend and together they have set up a considerate commuters campaign. He tabled an early-day motion in the previous Session and retabled it in this session as early-day motion 157. It requests the Association of Train Operating Companies, the Mayor of London and the Department for Transport to consider what might be done.

My hon. Friend also wrote to the Association of Train Operating Companies and the Rail Passengers Council asking them about the possibility of launching a campaign to encourage people to be more considerate. Again, I do not know whether the Minister has heard anything on that front.

The purpose of the new clause is both to highlight the circumstance of Janice Norman's loss and to promote the campaign so that passengers are considerate of their fellow passengers who are vulnerable. That includes pregnant women, elderly people and disabled people. It could be argued that to place a statutory duty on the Secretary of State to encourage such a campaign is over the top, but my argument is that the new clause can do no harm in asking the Secretary of State to encourage the train operating companies and others to have such a campaign. It would certainly bring this problem to the fore.

It would help to have greater understanding of the issue. One task that those involved might undertake would be research. The problem led to a tragedy in this instance, and I have no doubt that other members of the Committee will know of many other similar examples. I therefore commend the new clause to the Committee, on the basis that it cannot do any harm and could do a great deal of good.

Christopher Chope (Conservative, Christchurch)

I sympathise very much with what the hon. Gentleman said and about the awful case that he brought to our attention. My concern arises from a story in the newspapers over the last week, which suggests that things will get worse rather than better.

I understand that the Government are proposing that first class accommodation should no longer be available on certain lines. Some vulnerable passengers, particularly those in the later weeks of pregnancy, resort to travelling first class. At present that option is available, but if the Government remove first class carriages, they also remove the option to travel first class on large portions of the lines into London from the west which serve Bristol, Chippenham and so on. They intend to do that on the basis that more passengers can be crammed into second-class carriages and it is unreasonable that some people should be able to sit in first class carriages while others stand.

Tony McNulty (Labour, Harrow East)

As ever, I shall largely ignore the comments of the hon. Member for Christchurch, save to say that I am grateful that he at least recognises that the life of this Government goes beyond the next couple of months.

Christopher Chope (Conservative, Christchurch)

Why?

Tony McNulty (Labour, Harrow East)

I say that because the Committee would have no time for scrutiny if we spent all our time indulging the hon. Gentleman's idle fantasies and speculation, which have barely a passing acquaintance with the new clause.

It is a serious subject. The hon. Member for Caithness, Sutherland and Easter Ross said that I have been in correspondence not only with the hon. Member for Carshalton and Wallington but with the Association of Train Operating Companies and the RPC. In the strict technical sense we cannot pursue the new clause because it would not achieve anything. The Secretary of State has no power to instruct the RPC or ATOC to do anything. ATOC is the umbrella group of a private industry. We could instruct it all we like, but we have no power to tell it to do anything. We have set up the RPC, of old and of new, as an independent body outside the Government. It is rather inappropriate for us, having set up an independent body, to then instruct it what to do. However, I wrote in some detail to both organisations.

The new clause asks the Secretary of State to instruct two organisations that we have no locus to instruct. However, it goes further than that and would legislate for behaviour. That is the crux of the matter. We can do all we like but we will not achieve much, except in the things that the hon. Member for Caithness, Sutherland and Easter Ross suggested.

The Rail Safety and Standards Board has considered the health and safety effects of crowded trains on rail passengers. I believe that that report will be published at the end of this month, rather than at the end of last month, as was originally suggested. I have written to ATOC and RPC asking them to consider the matter in more detail and whether they would lend their weight to a broader campaign. I am more than happy to be party to that campaign.

The hon. Gentleman may know that London Underground Ltd. has a campaign under the banner of ''Love Is . . . '', which is like those cute, cheesy and nauseating little adverts. It has had a modicum of success in focusing on what should be second nature—consideration for fellow passengers generally and a high degree of consideration for those, such as pregnant women, who are clearly vulnerable.

Greg Knight (Conservative, East Yorkshire)

I hope that we are not going to end the Committee on a discordant note. My hon. Friend the Member for Christchurch raised a fair point. Some vulnerable passengers take the view that they enhance their safety by opting to sit in first class seats. Will the Minister answer the specific question that my hon. Friend put to him about that?

Tony McNulty (Labour, Harrow East)

With the greatest will in the world, the hon. Member for Christchurch made no such point. He said that it had been reported in the papers in the past couple of weeks that the Government are insisting on outlawing first class carriages. As ever, that is patent nonsense from the hon. Gentleman.

If the point is the one that the hon. Member for Caithness, Sutherland and Easter Ross made—that many TOCs upgrade season ticket holders who are heavily pregnant—then, because I understand the point about vulnerability being reduced in first class carriages, I undertake to ensure that TOCs that use that practice continue it and that those that do not do so consider implementing it. I absolutely agree to do that and understand that point entirely. It is entirely different to the facile, fatuous and idle speculation of the hon. Member for Christchurch. On the point of fatuity, I give way to the hon. Gentleman.

Christopher Chope (Conservative, Christchurch)

The Minister serves no good purpose by trying to insult members of the Committee. The issue is serious. I asked whether he would give an assurance that, as long as the Government continue in office—which I hope will not be for long—they will not allow train operators to withdraw first class accommodation on long-distance commuter services to London. That is the allegation that has been made and the concern that has been expressed. This is an opportunity for the Minister to give the assurance that I seek.

Sir David Amess (Conservative, Southend West)

Order. Before the Minister replies, I point out that the Committee is drawing to its conclusion. The hon. Member for Christchurch made his point. The matter should rest there. I ask for temperatures to be reduced.

Tony McNulty (Labour, Harrow East)

I repeat that the issue is serious. I am grateful to the hon. Member for Carshalton and Wallington for raising it; it should concern us all. As I understand it, the new clause moved by the hon. Member for Caithness, Sutherland and Easter Ross is, if not probing, a device to highlight the ongoing nature of bad passenger behaviour, sometimes with fatal consequences, as in the case of Janice Norman. I add my condolences and deepest sympathy to those expressed to her and her family for her loss. It is a serious matter.

If, through the RPC, ATOC, what the RSSB's report will say about health and safety and crowding, and legislation such as the Rail Vehicle Accessibility Regulations 1998—which suggest a minimum number of seats for comfort, and so on—we can move on from that appalling behaviour, I am more than happy to be a party to doing so. The new clause would not achieve that.

The issue is much broader than a campaign, a set of safety regulations or a piece of legislation. It is about getting everyone who uses our public transport systems—the same prevails on buses and other forms of public transport—to have some due regard and consideration for all fellow passengers, especially the most vulnerable. If the RPC and ATOC come up with a direction in which they want to go, rather like the ''Love Is . . . ''campaign that TFL and LU ran, and if the RSSB report makes such suggestions, we shall consider them extremely sympathetically. We cannot have a situation in which passengers, least of all the most vulnerable—a significantly pregnant woman such as Janice Norman is clearly vulnerable—are literally taking life, even if it is not their own, into their own hands by seeking to get from one place to another via public transport. I cannot put it in more serious terms than that.

The new clause does not represent the way forward, but I am more than happy to talk to the hon. Member for Caithness, Sutherland and Easter Ross and others about how we might heighten the awareness that is necessary for people to show just a bit of consideration for all, especially the vulnerable, on our public transport network. I ask the hon. Gentleman for those reasons to withdraw the motion.

John Thurso (Liberal Democrat, Caithness, Sutherland and Easter Ross)

I am grateful to the Minister and all of those who have taken part in this short debate, which, if nothing else, has helped to highlight some very serious issues. In that sense, part of my objective has been achieved.

The Minister said that it is impossible to legislate for behaviour. He is absolutely right, which is why the new clause would not legislate for behaviour, but encourage a campaign to persuade people. I entirely take his point on the technical deficiencies of the new clause, and I am grateful for what he said about what he will do to help to advance the cause. I am sure that we can rely on his good offices as an advocate with the bodies mentioned to ensure that we do whatever we can. In the light of that, I beg to ask leave to withdraw the motion.

Motion and clause, by leave, withdrawn.

New Clause 3 - Transfer of network assets

George Howarth (Labour, Knowsley North and Sefton East)

I beg to move, That the clause be read a Second time.

Sir David Amess (Conservative, Southend West)

With this it will be convenient to discuss the following:

New schedule 1—'Transfer of network assets—

TRANSFER SCHEMES: GENERAL

Transfer schemes: general

1 (1) A transfer scheme under this Schedule may—

(a) define the undertaking or part of an undertaking and property, rights and liabilities to be transferred to the transferee—

(i) by specifying or describing the property, rights and liabilities in question;

(ii) by referring to all (or all but so much as may be excepted) of the property, rights and liabilities comprised in a specified part of the transferor's undertaking; or

(iii) partly in the one way and partly in the other;

(b) provide that any rights or liabilities specified or described in the scheme shall be enforceable either by or against the transferor or transferee (or both of them);

(c) impose on the transferor or transferee an obligation to enter into such written agreements with, or execute such other instruments in favour of, the transferor or transferee or such other person as may be specified in the scheme;

(d) make such supplemental, incidental, consequential or transitional provision as the Secretary of State considers appropriate.

(2) An obligation imposed by a provision included in a transfer scheme by virtue of paragraph (c) of subparagraph (1) above shall be enforceable by civil proceedings by the transferor or transferee or other person mentioned in that paragraph for an injunction or for any other appropriate relief or remedy.

(3) A transaction of any description which is effected in pursuance of such a provision as is mentioned in subparagraph (2) above—

(a) shall have effect subject to the provisions of any enactment which provides for transactions of that description to be registered in any statutory register; but

(b) subject to that, shall be binding on all other persons, notwithstanding that it would, apart from this subsection, have required the consent or concurrence of any other person.

(4) No right of reverter, right of pre-emption, right of forfeiture, right of re-entry, right of irritancy, option or similar right affecting land shall operate or become exercisable as a result of any transfer of land—

(a) by virtue of a transfer scheme;

(b) by or under an agreement or instrument made or executed pursuant to any provision of this Schedule or pursuant to any directions given, or requirement imposed, under this Schedule; or

(c) pursuant to an obligation imposed by a provision included in a transfer scheme by virtue of paragraph (c) of subparagraph (1) above;

and, without prejudice to paragraph 12 below, any such right or option shall accordingly have effect in the case of any such transfer as if the transferee in relation to that transfer were the same person in law as the transferor and as if not transfer of the land had taken place.

(5) Subparagraph (4) above shall have effect in relation to—

(a) the grant or creation of an estate or interest in, or right over, land, or

(b) the doing of any other thing in relation to land,

as it has effect in relation to a transfer of land; and any reference in that subparagraph or in the following provisions of this paragraph to the transferor or the transferee shall be construed accordingly.

(6) In any case where—

(a) any such right or option as is mentioned in subparagraph (4) above would, apart from that subparagraph, have operated in favour of, or become exercisable by, a person, but

(b) the circumstances are such that, in consequence of the operation of that subparagraph, the right or option cannot subsequently operate in favour of that person or, as the case may be, become exercisable by him,

such compensation as may be just shall be paid to him by the transferor or the transferee (or by both) in respect of the extinguishment of the right or option.

(7) Any dispute as to whether any, and (if so) how much, compensation is payable under subparagraph (6) above, or as to the person to or by whom it shall be paid, shall be referred to and determined by an arbitrator appointed by the President for the time being of the Royal Institution of Chartered Surveyors.

(8) If it appears to the transferor that a person is or may be entitled to compensation under subparagraph (6) above, he shall—

(a) notify that person that he is or may be so entitled, and

(b) invite him to make such representations as he wishes to the transferor not later than fourteen days after the date of issue of the document containing the notification required by paragraph (a) above,

or, if the transferor is not aware of the name and address of the person concerned, shall publish, in such manner as he considers appropriate, a notice containing information about the interest affected and inviting any person who thinks that he is or may be entitled to compensation to make such representations to the transferor within such period (being not less than 28 days from the date of publication of the notice) as may be specified in the notice.

Functions under local or private legislation

2 (1) A transfer scheme may provide that any functions of the transferor under a statutory provision—

(a) shall be transferred to the transferee;

(b) shall be concurrently exercisable by two or more transferees; or

(c) shall be concurrently exercisable by the transferor and one or more transferees.

(2) Subparagraph (1) above applies in relation to any function under a statutory provision if and to the extent that the statutory provision—

(a) relates to any part of the transferor's undertaking, or to any property, which is to be transferred by the scheme; or

(b) authorises the carrying out of works designed to be used in connection with any such part of the transferor's undertaking or the acquisition of land for the purpose of carrying out any such works.

(3) A transfer scheme may define any functions of the transferor to be transferred or made concurrently exercisable by the scheme in accordance with subparagraph (1) above—

(a) by specifying the statutory provisions in question;

(b) by referring to all the statutory provisions which—

(i) relate to any part of the transferor's undertaking, or to any property, which is to be transferred by the scheme, or

(ii) authorise the carrying out of works designed to be used in connection with any such part of the transferor's undertaking or the acquisition of land for the purpose of carrying out any such works; or

(c) by referring to all the statutory provisions within paragraph (b) above, but specifying certain excepted provisions.

Provision of information

3 (1) Where the Secretary of State proposes to make a transfer scheme under section [Transfer of network assets], he may direct any person to whom this paragraph applies—

(a) to furnish him with such information as the Secretary of State considers necessary to enable him to make the scheme; and

(b) to do so within such time (being not less than 28 days from the giving of the direction) as may be specified in the direction;

and the persons to whom this paragraph applies are the Office of Rail Regulation, the transferor, any network operator, any station operator, any franchisee, any franchise operator and any wholly owned subsidiary of any of them.

(2) If a person fails to comply with a direction under subparagraph (1) above, the Secretary of State may serve a notice under subparagraph (3) below on that person.

(3) A notice under this subparagraph is a notice signed by the Secretary of State and—

(a) requiring the person on whom it is served to produce, at a time and place specified in the notice, to the Secretary of State or to any person appointed by the Secretary of State for the purpose, any documents which are specified or described in the notice and are in that person's custody or under his control; or

(b) requiring that person to furnish, at a time and place and in the form and manner specified in the notice, to the relevant authority such information as may be specified or described in the notice.

(4) No person shall be required under this paragraph to produce any documents which he could not be compelled to produce in civil proceedings in the court or, in complying with any requirement for the furnishing of information, to give any information which he could not be compelled to give in evidence in any such proceedings.

(5) A person who without reasonable excuse fails to do anything required of him by notice under subparagraph (3) above is guilty of an offence and shall be liable on summary conviction to a fine not exceeding level 5 on the standard scale.

(6) A person who intentionally alters, suppresses or destroys any document which he has been required by any notice under subparagraph (3) above to produce is guilty of an offence and shall be liable—

(a) on summary conviction, to a fine not exceeding the statutory maximum;

(b) on conviction on indictment, to a fine.

(7) If a person makes default in complying with a notice under subparagraph (3) above, the court may, on the application of the Secretary of State, make such order as the court thinks fit for requiring the default to be made good; and any such order may provide that all the costs or expenses of and incidental to the application shall be borne by the person in default or by any officers of a company or other association who are responsible for its default.

(8) Any reference in this paragraph to the production of a document includes a reference to the production of a legible and intelligible copy of information recorded otherwise than in legible form; and the reference to suppressing a document includes a reference to destroying the means of reproducing information recorded otherwise than in legible form.

(9) In this section ''the court'' means the High Court, in relation to England and Wales, and the Court of Session, in relation to Scotland.

Approval of transfer schemes

4 (1) The Secretary of State shall not make a transfer scheme except after consultation with the transferor.

(2) It shall be the duty of the transferor to provide the Secretary of State with all such information and other assistance as he may require for the purposes of or in connection with the exercise, in relation to a transfer scheme, of any power conferred on him by this section.

TRANSFER SCHEMES: SUPPLEMENTARY

Allocation of property, rights and liabilities

5 (1) The provisions of this paragraph and paragraph 6 below shall have effect where a transfer to which this Schedule applies is a transfer of all (or of all but so much as may be excepted) of the property, rights and liabilities comprised in a specified part of the transferor's undertaking, but shall not apply to any such rights or liabilities under a contract of employment.

(2) Any property, right or liability comprised partly in the part of the transferor's undertaking which is transferred to the transferee and partly in the part of that undertaking which is retained by the transferor shall, where the nature of the property, right or liability permits, be divided or apportioned between the transferor and the transferee in such proportions as may be appropriate; and, where any estate or interest in land falls to be so divided—

(a) any rent payable under a lease in respect of that estate or interest, and

(b) any rent charged on that estate or interest,

shall be correspondingly apportioned or divided so that the one part is payable in respect of, or charged on, only one part of the estate or interest and the other part is payable in respect of, or charged on, only the other part of the estate or interest.

(3) Any property, right or liability comprised as mentioned in subparagraph (2) above the nature of which does not permit its division or apportionment as so mentioned shall be transferred to the transferee or retained by the transferor according to—

(a) in the case of an estate or interest in land, whether on the transfer date the transferor or the transferee appears to be in greater need of the security afforded by that estate or interest or, where neither appears to be in greater need of that security, whether on that date the transferor or the transferee appears likely to make use of the land to the greater extent,

(b) in the case of any other property or any right or liability, whether on the transfer date the transferor or the transferee appears likely to make use of the property, or as the case may be to be affected by the right or liability, to the greater extent,

subject (in either case) to such arrangements for the protection of the other of them as may be agreed between them.

6 (1) It shall be the duty of the transferor and the transferee, whether before or after the transfer date, so far as practicable to arrive at such written agreements and to execute such other instruments as are necessary or expedient to identify or define the property, rights and liabilities transferred to the transferee or retained by the transferor and as will—

(a) afford to the transferor and the transferee as against one another such rights and safeguards as they may require for the proper discharge of their respective functions; and

(b) make as from such date, not being earlier than the transfer date, as may be specified in the agreement or instrument such clarification and modifications of the division of the transferor's undertaking as will best serve the proper discharge of the respective functions of the transferor and the transferee.

(2) Any such agreement shall provide so far as it is expedient—

(a) for the granting of leases and for the creation of other liabilities and rights over land whether amounting in law to interests in land or not, and whether involving the surrender of any existing interest or the creation of a new interest or not;

(b) for the granting of indemnities in connection with the severance of leases and other matters; and

(c) for responsibility for registration of any matter in any statutory register.

(3) If the transferor or the transferee represents to the Secretary of State, or if it appears to the Secretary of State without such a representation, that it is unlikely in the case of any matter on which agreement is required under subparagraph (1) above that such agreement will be reached, the Secretary of State may, whether before or after the transfer date, give a direction determining that matter and may include in the direction any provision which might have been included in an agreement under sub-paragraph (1) above; and any property, rights or liabilities required by the direction to be transferred to the transferee shall accordingly be regarded as having been transferred to, and vested in, the transferee by virtue of the scheme.

Variation of transfers by agreement

7 (1) At any time before the end of the period of twelve months beginning with the transfer date, the transferor and the transferee may, with the approval of the Secretary of State, agree in writing that—

(a) as from such date as may be specified in or determined under the agreement, and

(b) in such circumstances (if any) as may be so specified,

there shall be transferred from the transferee to, and vested in, the transferor any property, rights and liabilities specified in the agreement; but no such agreement shall have effect in relation to rights and liabilities under a contract of employment unless the employee concerned is a party to the agreement.

(2) Subject to sub-paragraphs (3) and (4) below, in the case of an agreement under sub-paragraph (1) above, the property, rights and liabilities in question shall be transferred and vest in accordance with the agreement.

(3) Any transfer effected in pursuance of an agreement under sub-paragraph (1) above shall have effect subject to the provisions of any enactment which provides for such transactions to be registered in any statutory register.

(4) The following provisions of this Schedule shall have effect as if—

(a) any reference to a transfer to which this Schedule applies included a reference to a transfer effected in pursuance of an agreement under sub-paragraph (1) above;

(b) any reference to a transaction effected in pursuance of paragraph 6(1) above or of a direction under paragraph 6(3) above included a reference to such an agreement; and

(c) any reference to a vesting by virtue of a transfer scheme included a reference to a vesting by virtue of such an agreement.

Right to production of documents of title

8 (1) This paragraph applies where, on any transfer to which this Schedule applies, the transferor is entitled to retain possession of any document relating in part to the title to, or to the management of, any land or other property transferred to the transferee.

(2) Where this paragraph applies—

(a) the transferor shall be deemed to have given to the transferee an acknowledgement in writing of the right of the transferee to production of that document and to delivery of copies of it; and

(b) section 64 of the Law of Property Act 1925 (c. 20) shall have effect accordingly, and on the basis that the acknowledgement did not contain any such expression of contrary intention as is mentioned in that section.

Perfection of vesting of foreign property, rights and liabilities

9 (1) This paragraph applies in any case where a transfer scheme provides for the transfer of any foreign property, rights or liabilities.

(2) It shall be the duty of the transferor and the transferee to take, as and when the transferee considers appropriate, all such steps as may be requisite to secure that the vesting in the transferee by virtue of the transfer scheme of any foreign property, right or liability is effective under the relevant foreign law.

(3) until the vesting in the transferee by virtue of the transfer scheme of any foreign property, right or liability is effective under the relevant foreign law, it shall be the duty of the transferor to hold that property or right for the benefit of, or to discharge that liability on behalf of, the transferee.

(4) Nothing in sub-paragraphs (2) and (3) above shall be taken as prejudicing the effect under the law of the United Kingdom or of any part of the United Kingdom of the vesting in the transferee by virtue of a transfer scheme of any foreign property, right or liability.

(5) The transferor shall have all such powers as may be requisite for the performance of his duty under this paragraph, but it shall be the duty of the transferee to act on behalf of the transferor (so far as possible) in performing the duty imposed on the transferor by this paragraph.

(6) References in this paragraph to any foreign property, right or liability are references to any property, right or liability as respects which any issue arising in any proceedings would have been determined (in accordance with the rules of private international law) by reference to the law of a country or territory outside the United Kingdom.

(7) Duties imposed on the transferor or the transferee by this paragraph shall be enforceable in the same way as if the duties were imposed by a contract between the transferor and the transferee.

(8) Any expenses incurred by the transferor under this paragraph shall be met by the transferee.

Proof of title by certificate

10 (1) In the case of any transfer to which this Schedule applies, a joint certificate by or on behalf of the transferor and the transferee that—

(a) any property specified in the certificate, or

(b) any such interest in or right over any such property as may be so specified, or

(c) any right or liability so specified,

is property, or (as the case may be) an interest, right or liability which was intended to be, and was vested by virtue of the scheme in such one of them as may be so specified (and, if it is the transferee who is so specified, that the property, interest, right or liability has not been transferred back to the transferor by virtue of an agreement under paragraph 7(1) above) shall be conclusive evidence for all purposes of that fact.

(2) If on the expiration of one month after a request from either the transferor or the transferee for the preparation of such a joint certificate as respects any property, interest, right or liability they have failed to agree on the terms of the certificate, they shall refer the matter to the Secretary of State and issue the certificate in such terms as he may direct.

(3) This paragraph is without prejudice to paragraph 18(6) and (7) below.

Restrictions on dealing with certain land

11 (1) If the Secretary of State is satisfied on the representation of the transferor or the transferee—

(a) that, in consequence of a transfer to which this Schedule applies, different interests in land, whether the same or different land, are held by the transferor and by the transferee, and

(b) that the circumstances are such that this paragraph should have effect,

the Secretary of State may direct that this paragraph shall apply to such of that land as may be specified in the direction.

(2) While the direction mentioned in sub-paragraph (1) above remains in force—

(a) neither the transferor nor the transferee shall dispose of any interest to which they may respectively be entitled in any of the specified land, except with the consent of the Secretary of State;

(b) if, in connection with any proposal to dispose of any interest of either the transferor or the transferee in any of the specified land, it appears to the Secretary of State to be necessary or expedient for the protection of either of them, he may—

(i) require either the transferor or the transferee to dispose of any interest to which he may be entitled in any of the specified land to such person and in such manner as may be specified in the requirement;

(ii) require either the transferor or the transferee to acquire from the other any interest in any of the specified land to which that other is entitled; or

(iii) consent to the proposed disposal subject to compliance with such conditions as the Secretary of State may see fit to impose.

(3) A person other than the transferor and the transferee dealing with, or with a person claiming under, either the transferor or the transferee shall not be concerned—

(a) to see or enquire whether this paragraph applies, or has applied, in relation to any land to which the dealing relates;

(b) as to whether the provisions of this paragraph have been complied with in connection with that, or any other, dealing with that land;

and no transaction between a person other than the transferor or the transferee on the one hand, and the transferor, the transferee or a person claiming under either of them on the other, shall be invalid by reason of any failure to comply with those provisions.

Construction of agreements, statutory provisions and documents

12 (1) This paragraph applies where, in the case of any transfer to which this Schedule applies, any rights or liabilities transferred are rights or liabilities under an agreement to which the transferor was a party immediately before the transfer date, whether in writing or not, and whether or not of such nature that rights and liabilities under the agreement could be assigned by the transferor.

(2) So far as relating to property, rights or liabilities transferred to the transferee, the agreement shall have effect on and after the transfer date as if—

(a) the transferee had been the party to it;

(b) for any reference (whether express or implied and, if express, however worded) to the transferor there were substituted, as respects anything falling to be done on or after the transfer date, a reference to the transferee;

(c) any reference (whether express or implied and, if express, however worded) to a person employed by, or engaged in the business of, the transferor and holding a specified office or serving in a specified capacity were, as respects anything falling to be done on or after the transfer date, a reference to such a person as the transferee may appoint or, in default of appointment, to a person employed by, or engaged in the business of, the transferee who corresponds as nearly as may be to the first-mentioned person;

(d) any reference in general terms (however worded) to persons employed by, persons engaged in the business of, or agents of, the transferor were, as respects anything to be done on or after the transfer date, a reference to persons employed by, persons engaged in the business of, or agents of, the transferee.

13 (1) Except as otherwise provided in any provision of this Act (whether expressly or by necessary implication), paragraph 12 above shall, so far as applicable, apply in relation to—

(a) any statutory provision,

(b) any provision of an agreement to which the transferor was not a party, and

(c) any provision of a document other than an agreement,

if and so far as the provision in question relates to any of the transferred property, rights and liabilities, as it applies in relation to an agreement to which the transferor was a party.

(2) In relation to any such statutory or other provision as is mentioned in sub-paragraph (1) above, references in sub-paragraph (2)(b), (c) and (d) of paragraph 12 above to the transferor and to any persons employed by, persons engaged in the business of, or agents of, the transferor include references made by means of a general reference to a class of persons of which the transferor is one, without the transferor himself being specifically referred to.

14 (1) On and after the transfer date for any transfer to which this Schedule applies, any statutory provision to which paragraph 2(3) of Schedule 6 to the Transport Act 1962 (c. 46) applies if in so far as the provision in question relates to any of the transferred property, rights and liabilities, shall have effect as if—

(a) any of the references modified by paragraph (a) of the said paragraph 2(3) were, as respects anything falling to be done on or after the transfer date, a reference to such person as the transferee may appoint; and

(b) any of the references modified by paragraph (b) of the said paragraph 2(3) were, as respects a period beginning with the transfer date, a reference to so much of the undertaking of the transferee as corresponds as mentioned in the said paragraph (b).

15 (1) The transferee under a transfer to which this Schedule applies and any other person shall, as from the transfer date, have the same rights, powers and remedies (and in particular the same rights and powers as to the taking or resisting of legal proceedings or the making or resisting of applications to any authority) for ascertaining, perfecting or enforcing any right or liability vested in the transferee by virtue of the scheme as he would have had if that right or liability had at all times been a right or liability of the transferee.

(2) Any legal proceedings or applications to any authority pending on the transfer date by or against the transferor, in so far as they relate—

(a) to any property, right or liability vested in the transferee by virtue of the scheme, or

(b) to any agreement or enactment relating to any such property, right or liability,

shall be continued by or against the transferee to the exclusion of the transferor.

(3) This paragraph is without prejudice to the generality of the provisions of paragraphs 12 to 14 above.

16 (1) If, in the case of any transfer to which this Schedule applies, the effect of any agreement (and, in particular, any agreement under the Railway Road Transport Acts of 1928 mentioned in paragraph 1 of Part II of Schedule 2 to the Transport Act 1962 (c. 46))—

(a) which was executed before the passing of this Act, and

(b) to which the transferee is by virtue of this Act a party,

depends on whether the transferee has power to carry on any activity, it shall be assumed for the purposes of the agreement that any activity which requires the consent of the Secretary of State under the Transport Act 1962 or the Transport Act 1968 (c, 73) has been authorised by such a consent.

17 (1) References in paragraphs 12 to 16 above to agreements to which the transferor was a party and to statutory provisions include, in particular, references to agreements to which the transferor became a party by virtue of any transfer scheme under the Railways Act 1993 (c. 43) and statutory provisions which applied to the transferor by virtue of that Act.

(2) The provisions of paragraphs 12 to 16 above shall have effect for the interpretation of agreements, statutory provisions and other instruments subject to the context, and shall not apply where the context otherwise requires.

Third parties affected by vesting provisions

18 (1) Without prejudice to the provisions of paragraphs 12 to 17 above, any transaction effected between the transferor and the transferee in pursuance of paragraph 6(1) above or of a direction under paragraph 6(3) above shall be binding on all other persons, and notwithstanding that it would, apart from this sub-paragraph, have required the consent or concurrence of any other person.

(2) It shall be the duty of the transferor and the transferee, if they effect any transaction in pursuance of paragraph 6(1) above or a direction under paragraph 6(3) above, to notify any person who has rights or liabilities which thereby become enforceable as to part by or against the transferor and as to part by or against the transferee; and if, within 28 days of being notified, such a person applies to the Secretary of State and satisfies him that the transaction operated unfairly against him, the Secretary of State may give such directions to the transferor and the transferee as appear to him appropriate for varying the transaction.

(3) If in consequence of a transfer to which this Schedule applies or of anything done in pursuance of the provisions of this Schedule

(a) the rights or liabilities of any person other than the transferor and the transferee which are enforceable against or by the transferor become enforceable as to part against or by the transferor and as to part against or by the transferee, and

(b) the value of any property or interest of that person is thereby diminished,

such compensation as may be just shall be paid to that person by the transferor, the transferee, or both.

(4) If it appears to the transferor that a person is or may be entitled to compensation under sub-paragraph (3) above, he shall—

(a) notify that person that he is or may be so entitled, and

(b) invite him to make such representations as he wishes to the transferor not later than fourteen days after the date of issue of the document containing the notification required by paragraph (a) above,

or, if the transferor is not aware of the name and address of the person concerned, shall publish, in such manner as he considers appropriate, a notice containing information about the interest affected and inviting any person who thinks that he is or may be entitled to compensation to make such representations to the transferor within such period (being not less than 28 days from the date of publication of the notice) as may be specified in the notice.

(5) Any dispute as to whether any, and (if so) how much, compensation is payable under sub-paragraph (3) above, or as to the person to or by whom it shall be paid, shall be referred to and determined by an arbitrator appointed by the President for the time being of the Royal Institution of Chartered Surveyors.

(6) Where, in the case of a transfer to which this Schedule applies, the transferor or the transferee purports by any conveyance or transfer to transfer to some person other than the transferor or the transferee for consideration any land or any other property transferred—

(a) which before the transfer date belonged to the transferor, or

(b) which is an interest in property which before that date belonged to the transferor,

the conveyance or transfer shall be as effective as if both the transferor and the transferee had been parties to it and had thereby conveyed or transferred all their interests in the property conveyed or transferred.

(7) Sub-paragraph (6) above applies in relation to the grant of any lease of, or any other estate or interest in, or right over any such land or other property as is there mentioned as it applies in relation to a transfer of any such land or other property; and references in that sub-paragraph to a conveyance or transfer shall be construed accordingly.

(8) If, in the case of any transfer to which this Schedule applies, it appears to the court at any stage in any court proceedings to which the transferor or the transferee and a person other than the transferor or the transferee are parties that the issues in the proceedings—

(a) depend on the identification or definition of any of the property, rights or liabilities transferred which the transferor and the transferee have not yet effected, or

(b) raise a question of construction on the relevant provisions of this Act which would not arise if the transferor and the transferee constituted a single person,

the court may, if it thinks fit on the application of a party to the proceedings other than the transferor and the transferee, hear and determine the proceedings on the footing that such one of the transferor and the transferee as is a party to the proceedings represents and is answerable for the other of them, and that the transferor and the transferee constitute a single person, and any judgement or order given by the court shall bind both the transferor and the transferee accordingly.

(9) In the case of any transfer to which this Schedule applies, it shall be the duty of the transferor and the transferee to keep one another informed of any case where either of them may be prejudiced by sub-paragraph (6), (7) or (8) above, and if either the transferor and the transferee claims that he has been so prejudiced and that the other of them ought to indemnify or make a repayment to him on that account and has unreasonably failed to meet that claim, he may refer the matter to the Secretary of State for determination by him.

Interpretation

19 (1) In this Schedule ''statutory provision'' means a provision whether of a general or of a special nature contained in, or in any document made or issued under, any Act, whether of a general or a special nature.'.

ÌMr. HowarthÌ: The new clause and schedule would help to bring about vertical integration or full local decision-making, and because I described what was meant by that earlier in the proceedings, I hope to be brief.

The new clause and schedule would allow the Secretary of State to make a statutory scheme for vesting all assets, property rights and liabilities of a network operator—by that, we really mean Network Rail—in a successor authority or company. Network Rail is not specifically mentioned in the new clause for technical reasons. I am very supportive of the Government's proposals to restructure the railways, particularly their objectives for a more efficient, more accountable and improved railway designed to support and sustain long-term economic growth and to promote social inclusion throughout the country. They are rather grand objectives, but they are appropriate.

The new clause and the new schedule would bring significant benefits in achieving those objectives. There would be much merit and little disadvantage if the Government took a general reserve power to allow the Secretary of State to make transfer schemes involving network assets. That would provide Ministers with a powerful tool with which to deliver a range of bespoke improvements across the network, such as micro-franchises, where opportunities arise in the future. I am using what seem like marketing-men expressions, such as ''micro-franchises'', but they have a real application. I will explain later what I mean by that. The new clause and the new schedule would enable vertical integration and full local decision making in circumstances where Network Rail does not co-operate with the Government's wish to see such things happen.

In addition to the scheme transferring property that forms part of the Merseyrail network, Network Rail undoubtedly has a series of contracts with landowners, tenants, subcontractors, suppliers, utilities and other third parties, which currently support its functions in relation to the Merseyrail network. That applies to any other line where similar arrangements might be sought and put in place. Those contracts will need to be transferred to Merseyrail in order to obtain full vertical integration and local decision making.

Improvements across the network include opportunities on Merseyside that are not at present part of the vertical integration and full local decision-making proposal. I include in these—I mentioned them earlier—the extension of the Merseyrail network to Headbolt lane in Kirby in my constituency and to Wrexham. We are very ambitious. My hon. Friend the Member for Manchester, Blackley (Mr. Stringer) and I have a vision of city regions. We are now proposing, through Merseyrail, that the city region stretch into north Wales and of course into west Lancashire, as I referred to earlier.

The reserve power would enable the Government to sanction and deliver projects similar to those that Merseyrail ambitiously wants to pursue. The fear is that without the reserve power, the ability of the Government to ensure that such projects are delivered would be seriously weakened. The power to transfer network assets would enable the Government to overcome the problems of bureaucracy, which I know bedevils the Minister's Department. It would prevent conflicts of interest from slowing down projects or preventing them from taking place, and it would help to avoid the adversarial relationships that have done so much to damage the UK's rail network in the recent past.

It is a rather lengthy new schedule and it is a complicated new clause. I do not know why, but I suspect that my hon. Friend the Minister will tell me that all these things can happen without my new clause and new schedule. If he cannot satisfy me on that point this morning, I will take solace in the fact that he has offered to meet to discuss these matters. No doubt he will provide fuller and better particulars on that occasion. I wait with massive interest to hear what he has to say on the matter.

Tony McNulty (Labour, Harrow East)

I seem to rise only not to disappoint my hon. Friend, in the sense that we feel that all that any PTE seeks to achieve can be achieved, as I said earlier, in the context of the law as it prevails at the moment. However, my concern about the new clause and the new schedule goes beyond that, as we are almost getting into the realms of the punitive—and the punitive in the context of relations with a private sector third party. That troubles me. That is not the relationship that we are seeking with Network Rail.

If Network Rail—because that will be the body on which there will be the most direct impact—exhausts negotiations with any PTE in the normal fashion, and they do not come to fruition and the output is not productive, the new clause would allow the Government to enforce the transfer of those assets from Network Rail to the rail operator or, in this case, the PTE. That is not the road we want to go down. To pursue the example of Merseyrail, we do not know whether an appropriate business case can be established in order to go down the route suggested by my hon. Friend; whether in all practicalities Merseyrail has the funding and resources to move in that direction; and whether, having exhausted negotiations with Network Rail, there will be an impasse or a negative result.

The overall thrust—the terminus, as it were—of the new clause and new schedule, which is the potentially antagonistic relationship with a third party, such as Network Rail in this example, is not the direction in which we want to travel. Many of the ambitions of Merseyrail and other PTEs, which I applaud, can be achieved within the existing framework, so I ask my hon. Friend to withdraw the motion. I do not doubt that when I see Mr. Scales on Thursday and PTE chief executives subsequently, this and other matters will be raised. I am happy to reflect on whatever they discuss and come up with, but the new clause and new schedule do not represent the way that we want to go; nor are they necessary for many of the PTEs.

George Howarth (Labour, Knowsley North and Sefton East)

Not wishing to end on a sour note, I think that I am grateful for the explanation that my hon. Friend the Minister has just given me, and I look forward to the discussions that he will have with Mr. Scales and, presumably, some of us beyond that. Beneath that brittle and sometimes adversarial front, my hon. Friend is really just an old softy. The idea that he would not want to get punitive with anybody—I have in mind in particular the hon. Member for Christchurch—is a little fanciful, and I am sure that he is concealing the softy in him very well, but we saw just a little chink in the armour today. With that, I beg to ask leave to withdraw the motion.

Motion and clause, by leave, withdrawn.

Question proposed, That the Chairman do report the Bill, as amended, to the House.

Tony McNulty (Labour, Harrow East)

Despite the odd high point and fit of pique, our deliberations have been in good heart. That is at least in part because of the good order in which you have kept us, Mr. Amess, for which I am enormously grateful. I am equally grateful for Mr. Griffiths' attendance when you could not be among us. I am very disappointed that I am still yet to be party in any capacity to the glory that would be serving under the chairmanship of the right hon. Member for Bromley and Chislehurst (Mr. Forth). I am sure that we all look forward to that experience with ''relish''.

I thank all members of the Committee for the way in which they have conducted themselves—in a serious and informed fashion. I make no apologies for occasionally turning up the heat and being adversarial. I am at heart, despite being a Minister, a political animal and a politician. I know that I do not suffer fools gladly, and I apologise for that, in some regard.

Greg Knight (Conservative, East Yorkshire)

Name the fools.

Tony McNulty (Labour, Harrow East)

No, I shall not. I apologise not for the focus or substance of my responses, but for the manner of them, which sometimes goes over the top. Despite feeling about 70 years old, I am still ever so slightly passionate about my politics.

There has been good order and a good spirit. I thank my hon. Friends and fellow Ministers. I certainly thank—although I am not sure that it is in order for me to do so—the army of officials from the civil service and the Bill team who stand behind me. It is the strength, substance and expertise of such a team that make the Minister look good. If I have looked good in any way during our deliberations, it is because of that army behind me, rather than because of me.

David Wilshire (Conservative, Spelthorne)

And when the Minister looks bad, it is his own fault.

Tony McNulty (Labour, Harrow East)

That is what they will tell me.

Finally, I remind members of the Committee that the Bill is only part of our vision for the railways industry. If I have been a tad miserly about accepting amendments, however well informed, that does not mean that at least a goodly core of them will not inform our deliberations in implementing the whole rail review White Paper, and not simply the Bill.

I thank everybody for their humour, consideration and courtesy, and, once again, particularly yourself, Mr. Amess. I am pleased that, like the railways industry in the future, we have reached this stage well ahead of schedule, certainly to timetable and at an appropriate speed as we bumped along.

Greg Knight (Conservative, East Yorkshire)

May I, on behalf of those on the Opposition Benches, associate myself with those remarks? I want to place on record our appreciation of the fair and temperate way in which you, Mr. Amess, and your co-Chairman, Mr. Griffiths, have chaired our proceedings. I also thank the Minister for showing us more of his Leslie Phillips persona and less of the bovver boy persona—a trend that I hope continues in future discussions and debates.

I also want to place on record my appreciation of the fact that the Committee has had two experienced, capable and competent Whips, who have helped our proceedings to run smoothly. I say to the Government Whip, the hon. Member for Stirling (Mrs. McGuire), that I think that we would be at this point in our proceedings even without the programme motion. I hope that she will reflect on that for future occasions.

If I have any regret, it is not about the lack of interrogation of the Minister or our contribution to the Committee, but that some members of the Committee, having had the honour of being appointed to it, regularly failed to attend. However, I thank all those who did attend and who played a constructive part in our proceedings.

John Thurso (Liberal Democrat, Caithness, Sutherland and Easter Ross)

May I say how much I and my hon. Friend the Member for Southport (Dr. Pugh) have appreciated your chairmanship and that of Mr. Griffiths, particularly the latitude that you allowed us over the clauses on closures? Your decision in that regard proved a wise one and allowed the dispatch to which the right hon. Member for East Yorkshire has referred. Therefore, we are grateful for that.

I thank the Minister for the way in which, in the main, he has handled the points that have been put forward. It is a very important Bill. The future of our railways is important to everybody. Broadly, as we said at the beginning, we support the Bill and have appreciated the way in which it has been taken through. We have had extremely good debates. I am sure that some points will be picked up at later stages, and probably in another place, but in the main the Bill is better for having come through a good Committee and ahead of schedule.

Sir David Amess (Conservative, Southend West)

I thank all hon. Members who have spoken for their kind and generous remarks. I and my co-Chairman, Mr. Griffiths, would simply say that it has been a real pleasure to chair this Committee. I thank all those who have assisted us with our proceedings, and particularly the Clerk for his fine advice.

Question put and agreed to.

Bill, as amended, to be reported.

Committee rose at eleven minutes past Eleven o'clock.