Orders of the Day — Railways Bill

House of Commons, 27 January 2005.

New Clause 1 — Provision of First Class Passenger Accommodation

Christopher Chope (Conservative, Christchurch)

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

Michael Lord (Deputy Speaker, Central Suffolk and North Ipswich)

With this it will be convenient to consider the following amendments: No. 52, in clause 32, page 33, line 21, at end insert—

'(e) a report by the Rail Passengers' Council concerning the economic, social and environmental costs and benefits of the proposal.'.

No. 53, in clause 33, page 34, line 43, at end insert—

'(1A) A closure ratification notice applying specifically to passenger services shall not be construed as applying to freight services.'.

No 5, in page 41, line 38, leave out Clause 39.

No. 30, in clause 39, page 42, line 49, at end insert

'"railway" has its wider meaning for the purposes of the Railways Act 1993; and'.

Government amendments Nos. 9 to 11.

Christopher Chope (Conservative, Christchurch)

The new clause would require proper consultation and discussion in respect of any proposal to withdraw first class passenger accommodation from an existing railway service. Discontinuing a first-class service would be put on a par with discontinuing any other service and trigger the consultation arrangements under part IV of the Bill.

Why is the new clause necessary? We believe that the Government have a covert agenda to ameliorate overcrowding on the railways by converting first-class accommodation to second class, instead of by expanding capacity.

John McDonnell (Labour, Hayes and Harlington)

I hope that that is right.

Christopher Chope (Conservative, Christchurch)

Perhaps the hon. Gentleman thinks that the Heathrow Express is an example of a better form of practice. When faced with increasing demand it increased the number of carriages on each service from 8 am to 9 am. That, surely, is a better way of responding to increased demand than by eliminating first class.

Brian H Donohoe (Labour, Cunninghame South)

It may be of interest to the hon. Gentleman to know that the Heathrow Express is about to lose its first-class compartments.

Christopher Chope (Conservative, Christchurch)

If that is so, I am sure that the hon. Gentleman would agree that that should be the subject of consultation and discussion with people who use the airport and that service. If that is the proposal and it is coupled with the threat hanging over the Gatwick Express, it drives a coach and horses through the Government's lip service to integrated transport. We need to ensure that our main airport hubs are linked by good quality transport to the central conurbation. That includes ensuring that public transport is of sufficient quality to appeal to those who aspire to travelling first class, as I suspect most hon. Members do, certainly when they are on official parliamentary business.

First-class accommodation is used by a variety of people. Many of them are vulnerable, elderly, have disabilities or are expectant mothers

John McDonnell (Labour, Hayes and Harlington)

Some of them are rich.

Christopher Chope (Conservative, Christchurch)

Perhaps some of them are rich. If the hon. Gentleman wishes to pursue his agenda for levelling down, let him join in the debate. Many people who use first-class accommodation are probably significantly less well off than he is, but choose to do so because they feel that if they were to travel standard class, as it is called, their health would be in jeopardy. A recent example was raised only yesterday in a debate in Westminster Hall of a pregnant lady who lost her child as a result of overcrowding on the train. We know that some of the more enlightened train operating companies, such as South West Trains, Thameslink and South Eastern Trains, offer complimentary first class upgrades to pregnant women holding season tickets when no seats are available in standard class. Obviously, they could not do that if there was no first-class accommodation.

Others using first-class accommodation have private or confidential work to do on the train, such as Government Ministers. Others choose to pay a premium—an unregulated fare—to provide more space and comfort and a better chance of obtaining a seat. That is particularly true of people joining busy commuter lines at intermediate stations. On the line that I use between Christchurch and Waterloo, it is possible for people joining the train at Christchurch or Hinton Admiral to get a seat, but for those who join at Winchester, for example, it is almost impossible. Many people are prepared to pay a premium fare so that they can have a seat in first class. A similar situation arises on many commuter lines into Paddington, including the Chippenham and Didcot lines.

First-class accommodation is also used in connection with high value added tourism services, which are particularly important for rural economies. The Great Western mainline route utilisation strategy, published by the Strategic Rail Authority in January, contained the expression,

"Alteration to the mix of first and standard class seating".

That was as a possible means of increasing capacity. The Daily Telegraph picked that up in a report on 13 January under the byline of the transport correspondent.

"A scheme to ease train overcrowding by reducing the number of first-class seats was put forward by Government rail advisers yesterday.

The Strategic Rail Authority said peak-time congestion on routes into London Paddington could be trimmed by converting premium accommodation to standard-class on turbo commuter trains and some high-speed services.

However, it also suggested that the gain in seats would be wiped out by the expected growth in passenger numbers within 12 months.

The SRA ruled out more ambitious plans for faster journeys and increased frequencies on grounds of cost, and warned there was little prospect of improving capacity or punctuality before 2011."

That is the sorry saga of this Bill and its background. It is a Bill to enable the Government to take control of a railway service which will be in decline in future because of a lack of investment. Because the Government have been embarrassed by the demand of the independent rail regulator, they have decided to circumvent the powers of that regulator and take more control of the service. That is why the Government are making themselves directly responsible for whether there will be first-class seats on mainline commuter services into London.

The story goes on. The Daily Telegraph correspondent went on to say:

"The SRA strategy was criticised by consumer groups. Mike Greedy, of the Western England regional passenger committee, said, 'If we want major improvement in rail services, there has to be substantial investment. Otherwise we stand no chance at all of encouraging people to switch to rail from the car.'"

It is the Government's agenda and is explicit in the Bill that people like Mr. Greedy, who serve diligently on the regional passenger committee, will be out of a job because the Government are abolishing regional passenger committees and centralising them. It is much more convenient for the Government if there are no people like Mr. Greedy to comment on their actions.

I raised those issues in Committee. The Minister described my questions as "idle fantasies and speculation". He then went on to describe them as "patent nonsense". I sought an assurance that the Government would not allow train operators to withdraw first-class accommodation on long distance commuter services to London, but I received no reply. I have asked about this on other occasions and the Minister has ducked and weaved and refused to confront this important issue.

The new clause gives the Government a chance to clarify their intentions in relation to the future of first-class rail travel. It ensures that if there are to be changes involving perhaps the withdrawal of first class, those changes should first be subject to proper consultation with the travelling public, as is required under part IV of the Bill.

Graham Stringer (Labour, Manchester, Blackley)

I rise to speak to amendment No. 30 to clause 39—the so called bustitution clause of the Bill. I also tabled amendment No. 29, which was not selected by Mr. Speaker.

I want to explore the scope and practical impact of clause 39. Where a train service is reduced or removed in a passenger transport authority area, clause 39 provides that that train service will be replaced by a bus service, so that the people who previously used the train have a bus service. It goes further than that, however, by allowing passenger transport authorities and passenger transport executives to impose a quality contract on bus operators in the area, which effectively means the regulation of those buses—even if train services are not being removed, it is good to re-regulate buses in metropolitan areas.

My questions concern the practicality and limits of clause 39. To explore those questions, one must realise that transport in metropolitan areas is not run by benign bus companies that deliver services efficiently, effectively and economically. In my part of Greater Manchester, the service is dominated by First group, which has an appalling record on punctuality and bus maintenance. In a recent inspection, the wheels were found to be falling off three of the buses, which is not unusual. In Yorkshire, an inspection of 96 vehicles found that more than half of them were not fit to be on the road.

The environment is not benign. I have met representatives from Arriva, First group and other bus companies, who do not like the idea of regulation. One of the reasons why they do not like it is simple: those bus companies make 14 per cent. profit in metropolitan areas outside London and 8 per cent. profit in Greater London, where the system is regulated. The regulated bus system in London works effectively and efficiently, unlike the system in other metropolitan areas in this country. The bus companies do not want to co-operate in providing a comprehensive integrated transport system. They provide services to give them the greatest possible bottom line, and they compete on the road in order to do so—sometimes they compete, but sometimes they form cartels and monopolies in order to make profits.

How does clause 39 overcome the problem of section 124 of the Transport Act 2000, which states how PTAs and PTEs can introduce quality contracts? The Government are reducing the timetable for consultation in section 124 to six months, which is welcome. However, section 124 also states that quality contracts may be introduced when they are the only practical way to provide bus services in an area. That is a high hurdle over which the PTAs and PTEs must jump. My reading of clause 39 is that section 124 of the 2000 Act remains, so that hurdle must still be overcome. Will the Minister explain how quality contracts can be implemented if bus companies are determined to change their services? Under the deregulated system, bus companies often provide services that they withdraw immediately after the consultation period. Clause 39 is defective and will not achieve its objective.

Clause 39 is also ambiguous. In Committee, we had an interesting debate—I thought that it was interesting, although I do not know whether the Minister agrees—about how far a quality contract can be extended following the de minimis withdrawal of a train service. If one train were removed from one commuter line in south Yorkshire or Greater Manchester, would clause 39 allow the regulation of all buses in south Yorkshire or Greater Manchester? I hope that the Government intended to leave that wonderful loophole to improve the delivery of bus services in metropolitan areas, but I do not think that that was their intention.

The limits of the quality contracts are not clear. In Committee, the Minister gave the helpful reply that quality contracts do not mean a substitute bus running alongside a railway line to the same timetable, and that the replacement service will be integrated into the rest of the system, but he did not provide a clear answer on how far that contract can go. Amendment No. 29 is designed to explore those issues so that we do not implement defective legislation that does not allow PTAs to introduce quality contracts when the conditions described in the Bill occur. The matter is important and we must get it right. As I said earlier, a regulated system would have merit without clause 39, but if clause 39 is included, I hope that it will be used to introduce a regulated bus service.

Elfyn Llwyd (Plaid Cymru, Meirionnydd Nant Conwy)

On new clause 1, although I appreciate that it is helpful to have first class and standard class on most lines, the hon. Member for Christchurch (Mr. Chope) over-egged his pudding. I often travel by first-class rail, but I also often travel standard class from north Wales to south Wales, and I am in reasonable health after doing so. To suggest that travelling by standard class is a health risk is beyond the bounds of credibility.

Amendment No. 52 seeks to introduce a further paragraph in clause 32(4), which concerns references to the Office of Rail Regulation. Railways are an integral part of the economy. They provide not only transport, but social, environmental and economic benefits. I hope that the Government will look favourably on amendment No. 52, which would complement clause 32(4) and round off the criteria for references to the Office of Rail Regulation. As it stands, clause 32(4) merely refers to "consultation" and does not refer either obliquely or plainly to the social, environmental and economic costs and benefits of the proposal being referred to the Office of Rail Regulation. I hope that the Minister can respond to that amendment, and possibly even accept it—I live in hope.

Amendment No. 53 is a probing amendment, which states:

"A closure ratification notice applying specifically to passenger services shall not be construed as applying to freight services."

If the Minister is prepared to tell me whether that is the case, the amendment will have been worth while. I hope that he can respond one way or t'other.

I will be brief because I know that Members wish to speak to other important amendments. I look forward to the Minister's response.

John McDonnell (Labour, Hayes and Harlington)

I tabled amendment No. 5 simply to allow me to express concerns in the rail industry and elsewhere about the process of—I hate the word—bustitution. The post-Beeching experience shows us that where such substitution bus services were introduced they often did not survive for long. We therefore need to take great care as regards any legislation that enables passenger transport authorities to undertake them.

Members on both sides of the House support the concept of quality controls with regard to bus quality contracts. London's regulated bus service has proved a success. However, it is strange that the Bill introduces bus quality contracts solely in relation to rail substitution services. What will the Government do to ensure that bus regulation is promoted throughout the country using bus quality contracts? It is unusual and bizarre to link that solely to the removal of railway services. I am concerned that if we allow the clause to go forward without further refinement, bus substitution services that are provided after rail service cuts will ultimately be cut once again, as they were after the Beeching regime.

Mark Field (Conservative, Cities of London and Westminster)

I fear that it falls to Conservative Members to defend the interests of first-class rail passengers. Nevertheless, my hon. Friend the Member for Christchurch (Mr. Chope) made some serious points. If high-quality passenger accommodation is available on all our trains, more people will use public transport, including those who might have been dissuaded from doing so in the past. In Heathrow, for example, taxi traffic may have been reduced as a result of the Heathrow Express. That would have more effect in the constituency of the hon. Member for Hayes and Harlington (John McDonnell) than in other parts of London. Does the Minister have any evidence that high-quality new services such as the Heathrow Express and Gatwick Express, with first-class accommodation, make a contribution to getting traffic off the roads? If not, will he conduct such a survey?

The amendment tabled by the hon. Member for Manchester, Blackley (Mr. Stringer) is sensible, but it shows a certain of degree of wishful thinking on his part about what goes on in London. While I would not want to gainsay anything said by the hon. Member for Hayes and Harlington, there are problems with the highly-regulated bus transport market in a broader sense, as well as in relation to bustitution. A significant amount of work is taking place on the tube and rail networks in the capital, often at weekends. There are very effective bustitution arrangements to deal with that, and I must give credit to Transport for London for doing a good job in that regard. As I live and work in central London, I use the buses regularly. I would be the first to say that there have been improvements to that service over the past four years under Mayor Livingstone. However, I am afraid that they have come at a great cost, which I suspect that he rather hoped would be underwritten by the Treasury. That has not happened, with the result that TFL faces losses of up to £1 billion a year from its budget for 2007–08.

Graham Stringer (Labour, Manchester, Blackley)

Does the hon. Gentleman accept that the regulated system that existed in London before it had a Mayor worked better than in the other metropolitan areas? It lost virtually no passengers between 1985 and 1999, when other cities lost 30 to 40 per cent. of their passengers; and before Mayor Livingstone, there was no subsidy. It was not a perfect system, but it worked better than elsewhere in the country, and we should have the benefit of that kind of system.

Mark Field (Conservative, Cities of London and Westminster)

I accept that. The hon. Gentleman will be glad to know that I consider Manchester to be this country's second city, partly because my in-laws live in Wilmslow, about 12 miles away from it. That is probably also why I can pronounce the name of the hon. Gentleman's constituency better than most southerners. He makes an entirely fair point. London's bus system has been pretty sophisticated, and regulation has helped. Transport for London does a good job in that regard, but there is a cost to be paid.

In central London, in particular, we have the problem of an enormous number of services, particularly in places such as Oxford street and Trafalgar square, where one sees bus after bus. That reminds me of what happened after the much-criticised deregulation of the market. In the mid-1980s, Oxford, where I was an undergraduate, had a massively deregulated market, and it was well-known that in Cornmarket one would see eight or nine buses from different companies all heading out towards London within five minutes of one another.

Here in London, things are not quite so simple. I hope that the Government will give serious consideration to what was said by Labour Members and by my hon. Friend the Member for Christchurch, who made a powerful case in relation not only to public safety but the broadening out of the use of our railways. That will be an important step forward if we are to get as much traffic off our roads as possible. The issue goes well beyond passenger traffic, as we also need to get as much freight as possible off our roads and on to rail.

Congestion is not only a problem for central London. Within the next few weeks, there will be a referendum on congestion charging zones in Edinburgh, and that may happen in other parts of the country. The railways must be part of the solution in the months, years and decades ahead.

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

The hon. Member for Christchurch mentioned the case of Mrs. Janice Norman, the lady who lost her baby after being poked in the stomach while travelling a few weeks previously. My hon. Friend the Member for Carshalton and Wallington (Tom Brake) has been pursuing the matter. When I raised it in Committee, I was reassured by what the Minister said and therefore withdrew my new clause on a campaign for considerate commuting. I do not necessarily accept that there is a link between that case and travelling first class.

I am attracted to the new clause not on health grounds but on the simple premise that where a service is introduced with certain criteria, and that service is to be withdrawn, it is right that the public should have an opportunity to be consulted.

Moreover, we know from the figures on traffic growth that it stems mostly from more affluent drivers, and if we are to persuade them to come off the road and get on to the train, it will often be necessary to provide a premium service.

I shall be interested to hear the Minister's response.

Tony McNulty (Labour, Harrow East)

I am grateful to the hon. Member for Christchurch (Mr. Chope) for explaining the point of new clause 1. However, I do not support his aim or the conspiratorial fantasies that lie behind it and I have grave reservations about the practical effect of the new clause.

The discontinuance provisions in part 4 are designed to deal with proposals to do away with a passenger service or close a station or part of the network. Those are specific matters. To protect passengers' interests, the procedures that have to be followed in those circumstances are set out in the Bill and are rightly rigorous. They rightly received a good deal of scrutiny in Committee. On the other hand, withdrawing first-class accommodation from a particular route or service might affect some passengers. However, there is a difference for a community between having a rail service that is more or less convenient than the existing one and having no service. The procedures in part 4 are designed to deal with only the latter.

I am also concerned about the practicalities. There is no incentive to take away first-class accommodation where it is well used and every incentive for the operator to get the balance right for the benefit of all customers. That makes sense if it is thought through. There is no sense in requiring operators to run trains with almost empty first-class seats when there is little demand and at times when standard-class passengers cannot get a seat. Perhaps the hon. Gentleman's concern has been prompted by First Great Western's route utilisation strategy, which includes proposals to alter the mix of first and standard-class seating on some routes. If that is implemented, it would be a further factor for consideration in addition to the train operating companies' commercial judgment.

However, the essential principle still applies: imposing a statutory procedure will seriously inhibit operators' flexibility to respond to changing demand and others' ability to propose to them that they might do so. Although the new clause might appear to defend the interests of specific sets of passengers, it does nothing for passengers as a whole—first-class, standard-class, steerage or whatever else exists—because it would restrict operators' flexibility to respond to the passengers about whom the hon. Gentleman seems to be concerned.

The proposal also appears to raise some complicated issues of definition, because it refers simply to first class. There is no industry-wide definition of first class. At least one operator has no first class as such, but offers a choice of standard and club. The new clause would not cover that. Others have intermediate categories such as silver standard. Again, the new clause does not reflect that. Each offers the passenger a slightly different package, and even when first-class accommodation is advertised as such, the precise service varies from operator to operator.

Those who want to travel first class do not do so in the hope that there will be three first-class carriages on a train; they simply want a seat in first-class accommodation. It does not matter to the business community, or whoever the hon. Gentleman meant, whether three carriages or one carriage separate them from the riff-raff—the clear implication of his remarks—so long as they get the service for which they paid. That only reinforces my view that we should avoid statutory constraints on operators' commercial freedom to offer different services and that any attempt to impose them would throw up serious problems of definition and practicality.

In short, the new clause is impracticable as well as undesirable, and I invite the hon. Gentleman to withdraw it.

Let me deal with the other amendments briefly. Amendment No. 52 would impose a new duty on the Rail Passengers Council to provide a report on the economic, environmental and social costs and benefits of a closure proposal as part of the material accompanying a reference to the Office of Rail Regulation in clause 32.

I take the points that the hon. Member for Meirionnydd Nant Conwy (Mr. Llwyd) made, but I believe that the amendment is unnecessary because the initiator of the proposal would already have carried out such an assessment. That body, either an operator or railway funding authority, is under a duty to assess the effects of a closure proposal according to the closures guidance that the Secretary of State, Scottish Ministers and the National Assembly for Wales, as the case may be, have a duty to provide under clause 42.

Earlier this week, I sent the Chairman of Standing Committee A, which deliberated on the Bill, a note setting out current thoughts on the contents of the closures guidance. A copy is in the Library. The note states that any assessment of a closure proposal should cover the costs and benefits of environmental, economic, safety, accessibility and integration effects. Those of course include the effects on passengers, freight users and operators, as well as on the environment. Assuming that the Bill obtains Royal Assent, we shall consult on the draft closures guidance before the main network modification provisions are brought into force. The Office of Rail Regulation's role is to ensure that the assessment is carried out in accordance with the guidance and that it meets any criteria in it. That provides important independent input into the procedures.

Requiring the Rail Passengers Council to do a similar assessment could put considerable strain on its resources only to replicate work that has already been done. I therefore accept the thrust and import of the amendment but believe that, although the hon. Gentleman's points were well made, the headlines of the closures guidance that we have already issued cover them. I hope that he accepts that.

Amendment No. 53 appears to intend to exclude freight services from the network modification procedures in the Bill. Again, I respectfully suggest that that is unnecessary as the provisions in the Bill for discontinuing services apply only to passenger services, as do the current procedures—which we seek to replicate in the new settlement for the industry—in the Railways Act 1993.

However, that is most definitely not to say that freight operators or customers have no input into the network modification procedures. The note on closures guidance clearly states our intention that the final guidance will make it clear that, if freight services are affected by a closure proposal, the impact on freight users and operators must be assessed and taken into account when developing the proposals. Furthermore, if freight operators are affected by the proposal, schedule 7(3)(2)(k) provides for a statutory duty to consult them. I would also expect freight customers to be consulted under those circumstances. Although the network modification elements of the measure refer specifically to passenger services, other components protect the role of freight on rail lines and parts of the network.

Let me deal with the amendments to clause 39. We have a sort of dichotomy, because one amendment would remove it altogether and the other would extend it to light rail and other guided systems. I take the point made by my hon. Friend the Member for Manchester, Blackley (Mr. Stringer) that amendment No. 30 would make more sense had amendment No. 29 also been selected.

With regard to amendment No 5, which my hon. Friend the Member for Hayes and Harlington (John McDonnell) tabled, I accept the concerns, which are rooted in history, about all the promises that were made at the time of Beeching for a host of bus services to replace many of the rail lines that were to close. The substitution of buses was either not forthcoming or happened for only a short time.

As my hon. Friend the Member for Manchester, Blackley said, there is a regulatory framework in statute in the Transport Act 2000, suitably adjusted with regard to timing. We made it clear in the July White Paper on the role of transport in the broader sense, not the rail White Paper, that we are trying to encourage authorities, especially in urban areas, to devise far-sighted, radical and integrated transport packages for all modes of transport. In that context, we would be happy to make the bus service operators grant and other elements available to the authorities so that they had far more control over the buses and could replicate something similar to the semi-regulated position that pertains in London.

Paul Truswell (Labour, Pudsey)

I am pleased to hear what my hon. Friend has just said, but does he accept that the only practicable way of introducing quality contracts would involve a virtually insurmountable hurdle that would ultimately have to be tested in the courts? Will he reconsider whether that test could be reduced, so that there could be a better balance between the interests of passengers and the interests of the operators in making profits?

Tony McNulty (Labour, Harrow East)

In all candour, I have to say no, I do not accept that. As the Minister with responsibility for buses last year and this year, I have said that I do not believe that local authorities have pushed the regulatory framework in the Transport Act 2000 to its limits, with or without taking into account what we said in the July White Paper. They have not been dilatory, but they have been slow in coming forward with imaginative ways of moving towards a bus quality contract. There are many ways, under the 2000 Act and the proposals in the July White Paper, in which local authorities can move towards affording their communities the required regulatory framework and subsequent bus provision. We stand ready to work with any local authority to push things in that direction, not least in the context of what we said in July. So I do not accept the thrust of what my hon. Friend has just said, although he will know that his view is shared by many of our colleagues, and almost certainly by many people in the passenger transport executives.

Graham Stringer (Labour, Manchester, Blackley)

We are familiar with both sides of this argument. The implication of what my hon. Friend the Minister is saying is that the Secretary of State for Transport can take the decision to agree quality contracts. The strength of the argument put forward by my hon. Friend the Member for Pudsey (Mr. Truswell) and I is that, while section 124 of the 2000 Act remains, that decision is with the courts, not with the Secretary of State. It is therefore very difficult for any local transport authority to show that its proposals are the only practical way available.

Tony McNulty (Labour, Harrow East)

There are certainly clear and exacting criteria in the Transport Act 2000. They need to be seen in the light of changes that we have made to the regulatory framework since then, and of the way in which we shall take forward the announcements that we made in July. We are starting to talk seriously with a range of authorities about how all these elements can be brought together, and I do not doubt that my hon. Friends the Members for Manchester, Blackley and for Pudsey and I will have further deliberations on it with a whole range of other colleagues as well. It is time to talk far more readily about how all the assorted modes can work together and, in that context, whether quality contracts have a role.

In terms of network modification, it is appropriate to have such measures in the Bill, although I accept the concerns that have been expressed about what prevailed post-Beeching. I do not accept that we are seeking to do something similar. This was debated at length in Committee. Where a local community's transport needs result in a requirement for a quality contract so that buses can replace lines and services that have been discontinued, it makes perfect sense to have one. We discussed the assorted elements involved, and we need to look at the issue in much more detail and do much more work on the substance of how the provisions will work. They could well form part of a broader quality contract that could be brought in for a particular area.

It is important that the provisions should be in the Bill, but not to facilitate closing another third of the rail network, as Beeching did, while promising to replace the services with buses and then not doing so, or doing so only for the short term. It makes sense that the provisions relating to facilities for bus substitution—I shall not use the horrendous word "bustitution"—be included in the Bill. In this context, it has already been pointed out that amendment No. 30 does not make a whole lot of sense without amendment No. 29, and I agree with that. On its own, amendment No. 30 does not fit with the rest of the Bill, although it would have gone alongside the other one. I understand the attraction for passenger transport authorities of including light rail in the provisions, but, given the way in which amendment No. 30 would sit with the rest of the Bill, we do not think that it is appropriate to pursue this matter.

David Clelland (Labour, Tyne Bridge)

The Minister sounds as though he is saying that he would have some sympathy with amendment No. 30 if it were put in the right context. Would he be prepared to consider this issue again in another place?

Tony McNulty (Labour, Harrow East)

I am grateful to my hon. Friend for that intervention, because if that is the impression that I gave, it was entirely illusory. I was merely expressing sympathy with my hon. Friend the Member for Manchester, Blackley because amendments Nos. 29 and 30 sat together, and it was a shame that we could discuss only one and not the other. The two should have come as a package. I am grateful to my hon. Friend the Member for Tyne Bridge (Mr. Clelland) for allowing me the opportunity to clarify my position on that; I would not want to mislead him in any way.

Of the Government amendments at the end of this group, the main one is Government amendment No. 11, which is required to give Scottish Ministers certain powers in relation to rail services, networks and stations that are wholly in Scotland, as well as to certain cross-border services. As clause 44 is currently drafted, only the Secretary of State has those powers. The amendment adds the Scottish dimension in terms of giving the powers to Scottish Ministers. The other two Government amendments are consequential on the thrust of Government amendment No.11.

Much of our discussion has been on serious issues, and I would ask the House to reject the amendments, other than the Government amendments.

Christopher Chope (Conservative, Christchurch)

I am grateful to my hon. Friend the Member for Cities of London and Westminster (Mr. Field) and to the hon. Member for Caithness, Sutherland and Easter Ross (John Thurso) for their comments in support of new clause 1. I would simply say to the hon. Member for Meirionnydd Nant Conwy (Mr. Llwyd) that the circumstances of the average railway passenger on a rural line in Wales are very different from the hustle and bustle involved in commuting into London. My hon. Friend the Member for Cities of London and Westminster and the hon. Member for Caithness, Sutherland and Easter Ross raised the kind of pertinent questions that would have to be answered if there were a proper consultation process on any proposal to remove a first-class service.

The Minister resorted to the last desperate line of defence when he said that the problem was that the new clause did not define first-class passenger accommodation. I do not think that there is anyone in the House who does not understand what we mean by that term. To suggest that the new clause is defective because the term is not defined is absurd. The Minister also tried to argue that the withdrawal of first-class accommodation would affect fewer people and be less significant than the closure of a rural station or the withdrawal of a rarely used rural service. Again, I disagree with him, because I believe that the withdrawal of first-class accommodation could, in certain circumstances, affect much larger numbers of people. That is why any such proposals should be subject to consultation, as the new clause suggests.

What I found most worrying about the Minister's response was his suggestion that the new clause would impose constraints on the freedom of operators. He then conceded, however, that the whole system of the route utilisation strategy will be controlled from the centre by the Government. That in itself will inhibit the freedom of operators to decide what is the best mix of first and standard-class accommodation. So I remain suspicious about the Government's agenda, and the best way forward is to ensure that, if they pursue these proposals, they are forced to consult on them.

Tony McNulty (Labour, Harrow East)

The hon. Gentleman is entirely wrong. That is not the function of the route utilisation strategy. Its function is to come up with strategies to use the route and eventually feed that into the franchise templates against which all operators will bid.

Christopher Chope (Conservative, Christchurch)

The Minister has done nothing to allay my concerns. He says that route utilisation strategies will feed into the specification that is used for the franchisees to bid against. I submit that, if one is a potential franchisee, and one does not bid against the specification laid down by the centre, one's chances of success in that franchise bidding are very small.

The only way to allay the increasing concerns of those who travel first class occasionally or frequently, particularly on main routes into London, is to ensure that they would be given proper notice and have the chance to express their views through consultation. I therefore hope that the House will support new clause 1.

New Clause 3 — Railway Functions of Passenger Transport Executives in Scotland

Ian Davidson (Labour/Co-operative, Glasgow Pollok)

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

Michael Lord (Deputy Speaker, Central Suffolk and North Ipswich)

With this we may discuss the following amendments: No. 64, in clause 5, page 5, line 38 at end insert

'and they shall concurrently publish in full the reasons for adopting the strategy or revised strategy.'.

No. 7, in clause 13, page 12, line 2, at end insert 'in England'.

Ian Davidson (Labour/Co-operative, Glasgow Pollok)

The Conservatives have just fought for the rights of first-class passengers; I want to speak up for people in Strathclyde.

The amendments are intended to maintain equality between Scotland and England in terms of the role of passenger transport executives in the rail franchising process. Although the Bill will devolve significant additional powers over the railway network in Scotland to Scottish Ministers, it does not confer any additional legislative competence on the Scottish Parliament. The primary legislation governing the relationship between Ministers and regional authorities on railway matters will remain reserved to this Parliament. Consequently, unless the Bill gets it right, there is a real risk of a gap in the statutory chain, which could both fetter the future discretion of Scottish Ministers and frustrate the effective delivery of integrated transport in the west of Scotland.

This is not just a matter of legal niceties. It is of fundamental importance to my constituents, and to the 44 million passengers who use the Strathclyde rail network each year. Rail travel accounts for more than a quarter of all fare-paid journeys in the Strathclyde area, and the level of railway use in the west of Scotland is second only to that in Greater London. The railway network is therefore a core component in the regional transport system in Strathclyde. It is also undoubtedly a key reason why there are proportionately fewer car journeys in Strathclyde than in the rest of Scotland.

In other words, we are looking at a balance between private and public transport in the west of Scotland that clearly goes with the grain of the Government's national transport and sustainability objectives. It is important that the Bill should not undermine the continued delivery of integrated transport in the Strathclyde Passenger Transport area, and therefore unwittingly work against the wider policy objectives that the Government have set themselves.

The relatively healthy state of affairs in the west of Scotland's transport is not simply a happy accident. It is the result of more than 30 years of conscious political choice and deliberate financial decisions by accountable regional bodies that had the will and the means to influence directly the delivery of local railway services as part of an integrated transport system. Strathclyde regional council, of which I was a member—as was the Minister: I hope she will bear that in mind when she replies—invested more than £400 million in developing the local railway network while it was the passenger transport authority for the area. Since railway privatisation, the successor PTA has spent over £50 million of discretionary funding in service and network enhancements, and a recent study by consultants appointed by the Scottish Executive has shown that more than half the growth in traffic and revenue on the Strathclyde rail network during the 1990s was directly due to initiatives by the PTA and the PTE.

Such an outcome is clear proof of the correctness of what the Secretary of State for Transport said in the House when he introduced the railway White Paper:

"Local transport decisions are best taken by people who know what is needed locally." [Official Report, 15 July 2004; vol. 423, c.1548].

It also seems to accord with the intentions of the Scottish Transport Minister, Nicol Stephen, who has said:

"I still expect SPT to have a direct role in the management and development of rail services in the west of Scotland." [Scottish Parliament Official Report, 16 June 2004; c. 9099.]

Unfortunately, the present drafting of the Bill appears to undermine the delivery mechanism for that assurance. It is that defect that the amendments seek to address. The Bill proposes to take away PTEs' existing powers in relation to rail franchises, and clause 13 replaces them with new provisions for engaging PTEs in the franchising process. However, clause 13 does not apply in Scotland, although this is an area where the Scottish Parliament has no competence to enact equivalent or alternative provisions. The amendments therefore seek to introduce an additional clause that will give Ministers in Scotland the same discretion to involve a passenger transport executive in future railway franchises that the Secretary of State for Transport seeks in relation to English PTEs.

There is a parallel Bill before the Scottish Parliament that could potentially amend the basis on which SPT currently operates, and result in a transfer of powers between it and Scottish Ministers. That is an undoubted complication, but I cannot emphasise too strongly that it does not remove the need for the amendments. I remind the Minister that the Scottish Parliament is not able to amend the underlying legislation governing railways. It is also worth pointing out that Holyrood's Transport (Scotland) Bill is at a less advanced stage than the Railways Bill, and its key components in relation to SPT are simply enabling. Their implementation will depend ultimately on secondary legislation whose terms and scope have yet to be defined, let alone scrutinised by the Scottish Parliament.

The Government's acceptance of the amendments would not oblige Scottish Ministers to follow any particular future course of action, other than introducing a statutory obligation to consult. I am sure that hon. Members would in any event endorse that latter requirement. The same principles of open and accountable government should be adopted consistently throughout the United Kingdom, and should not be differentially applied in a Bill that is the responsibility of this Parliament.

The remaining provisions of the amendments put the Bill's application to a PTE in Scotland on the same footing as in England. They would preserve a statutory framework that would enable, but not compel, Scottish Ministers to adopt the same participatory approach to a rail franchise in Scotland that would be available to the Secretary of State for Transport in England in equivalent circumstances.

We are always dealing with hypothetical situations when legislation is in progress, but in this one, the uncertainty is compounded by the fact that two legislatures are involved. If this part of the Railways Bill is passed unamended, there is a tangible risk of unintentionally restricting the future ability of the Scottish Executive and the Scottish Parliament to provide for the continuing effective delivery of integrated transport in the west of Scotland. Such a risk could arise, for example, if the current Transport (Scotland) Bill failed to gain Royal Assent or was substantially amended by the Holyrood Parliament. A risk could also arise if Scottish Ministers chose not to exercise their proposed power to initiate secondary legislation in this field, or sought to change the basis of that legislation at the outset or in future.

My new clause and amendment seek to remove such risks by ensuring the consistency of the reserved legislative framework within which devolved railway policy will be made and delivered in Scotland. They preserve, rather than forgo, options by preventing a situation in which Scottish Ministers are statutorily debarred from involving a PTE in rail franchising. In the interests of even-handedness and of ensuring the future delivery of integrated public transport in the west of Scotland, I commend the proposals to the House. I am sure that the Minister will not fail to be moved by them and will accept them.

Greg Knight (Conservative, East Yorkshire)

I rise to speak to amendment No. 64, which would add to the end of clause 5(2) the phrase

"and they shall concurrently publish in full the reasons for adopting the strategy or revised strategy."

A duty would thereby be imposed on Scottish Ministers, in preparing or revising a strategy, to publish in full their reasons for so doing.

We live in an age of openness and—I like to think—fairness, and everything that we do should at least be within the spirit of the Freedom of Information Act. The public have a right to know why decisions are made using their money in their name, and the amendment would impose a duty on Scottish Ministers to ensure that whenever they publish or change a strategy, they explain why.

I hope that the Minister will tell me and the House that my amendment is not necessary because she expects the giving of such explanations to be best practice. If she does, I shall be delighted not to pursue the matter further.

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

Was the right hon. Gentleman referring to the Westminster Freedom of Information Act 2000 or to the Freedom of Information (Scotland) Act 2002?

Greg Knight (Conservative, East Yorkshire)

My general point was that in the enlightened age in which we now live, one hopes, an increasing number of decisions made involving the use of public money are open to scrutiny.

The hon. Member for Glasgow, Pollok (Mr. Davidson) made the case for new clause 3 very well, but nothing that he said led me to conclude that we should support him if he decides to divide the House on it.

Anne McGuire (Labour, Stirling)

I am grateful to my hon. Friend the Member for Glasgow, Pollok (Mr. Davidson) for explaining the point of his new clause, which is that this Bill should make the same provision for passenger transport executives in Scotland as for those in England.

I, too, remember fondly our days as members of Strathclyde regional council many years ago, on which we both served our political apprenticeship. If I remember correctly, he had to serve his slightly longer than I served mine, before moving on to other things.

I accept what my hon. Friend said about the approach of Strathclyde PTE, and I should make it clear that I highlighted those points in responding to my hon. Friends the Members for Glasgow, Cathcart (Mr. Harris) and for Cumbernauld and Kilsyth (Rosemary McKenna), who have raised similar issues before. That PTE was forward-thinking and was at the forefront of providing integrated transport. As my hon. Friend alluded to, it underpinned a political agenda that recognised the need and desire in the west of Scotland for an integrated public transport system that served all the communities in the area. I should point, however, that I will be asking my hon. Friend to withdraw his new clause and amendment, for reasons that I hope he will understand.

It would be remiss of me not to put on the record the fact that yesterday, the Scottish Parliament gave its unanimous support—such unanimity is very unusual—for a Sewel motion transferring functions relating to railways from this House to Scottish Ministers. Having agreed that transfer of power to Scottish Ministers, it would not be right for this House then to second-guess what they want to do. As my hon. Friend said, they have outlined their approach to railway development in Scotland in the Transport (Scotland) Bill. They have made it clear that there will be a need for local input into the Scottish rail network, and have therefore stated categorically that the west of Scotland regional transport partnership, which will replace Strathclyde PTE, will have a role in the development, management and monitoring of the franchise in that part of Scotland. Indeed, the new regional transport partnerships will be established across Scotland.

I am aware that concern exists that there might be a gap between enactment of the Railways Bill and of the Transport (Scotland) Bill, but we anticipate no such gap. Under the terms of clause 14 of the Railways Bill, Strathclyde PTE will continue to be a party to the ScotRail franchise. That will allow it to maintain its current role in the management of that franchise, until Scottish Ministers make an order under the Transport (Scotland) Bill—once enacted—to transfer its powers.

The Transport (Scotland) Bill also includes provisions that allow Scottish Ministers, if they so wish, to transfer or share their own transport functions with the new regional transport partnerships that will be established across Scotland. Therefore, if they wish, Scottish Ministers can share rail functions with any RTP. So clause 13 as drafted will not statutorily debar Scottish Ministers from involving other parties in rail franchises, and in the light of that assurance, I hope that my hon. Friend will see fit to withdraw his new clause. If he does so, it would be entirely logical for him to withdraw amendment No. 7 as well.

The amendment tabled in the name of the right hon. Member for East Yorkshire (Mr. Knight) is not necessary. We share the view that there needs to be maximum consultation, transparency and openness. Under freedom of information Acts north and south of the border, the opportunity now exists to underpin that transparency. I know that Scottish Ministers share the UK Government's concern that Scottish citizens should be properly informed about what is proposed for their railway network and why. As I said in Committee in response to a previous amendment to clause 5 that was based on a similar principle, the Scottish Executive have adopted the principles of the Cabinet Office's code of practice on policy development and public consultation. That being the case, the reasons behind policy and strategy proposals will be explained as part of observing those principles, and of good practice. There is every likelihood that before its actual publication, a strategy will have been widely available as a consultation document.

Those of us who represent Scottish constituencies know that the Scottish Executive and the Scottish Parliament are well versed in the importance of consultation in respect of policies and initiatives.In that spirit, I ask my hon. Friend the Member for Glasgow, Pollok to withdraw the new clause.

Ian Davidson (Labour/Co-operative, Glasgow Pollok)

As ever, my hon. Friend the Minister has been polite and considerate and has yielded no ground. Goodness me—some things have not changed since our days in Strathclyde! I had hoped that she might have mellowed, but apparently she has not.

I understand that I have a decision to make about pressing the new clause to a vote. It is maybes aye, and maybes no—but, on balance, I think that I will not do so.

I beg to ask leave to withdraw the motion.

Motion and clause, by leave, withdrawn.

New Clause 5 — Rail Efficiency Report

Greg Knight (Conservative, East Yorkshire)

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

Sylvia Heal (Deputy Speaker, Halesowen and Rowley Regis)

With this it will be convenient to discuss New clause 6—Redundant Assets Register—

'The Secretary of State shall every three years lay before each House of Parliament a register of all assets including land and property owned by Network Rail which are redundant to railway use or which have not been used for railway purposes during the preceding eighteen months together with a statement of intent regarding their future use or disposal.'.

Greg Knight (Conservative, East Yorkshire)

The Standing Committee debates on this Bill were very constructive, and genuine concerns were raised by hon. Members from all parties. It is in that spirit of constructive debate that I wish to speak to these new clauses.

The new clauses are reasonable, moderate and fair, and I hope that the Minister of State will respond positively to them. New clause 5 would require the Secretary of State to publish an annual rail efficiency report containing his assessment of the performance and cost effectiveness of Network Rail in the previous 12 months. In particular, it would encourage him to provide comparative data in respect of those rail companies operating wholly or in part in the EU.

The suggestion is not impractical. The Minister will know—as will many Conservative Members—that the EU position on railway service reform has three stages. Perhaps predictably, they are called the first railway package, the second railway package and the third railway package.

The second railway package aims to create a legally and technically integrated European railway, and was adopted by the EU in April 2004. The third railway package sets out proposals to open up international passenger services to competition inside the EU by the year 2010. It is therefore entirely appropriate that we should, wherever possible, compare the performance of the UK rail network with that of our European counterparts.

When hon. Members raise concerns about our railway system, they often say how wonderful the railways in France are. I have never had the delight of travelling on a French train, but I should be delighted to be able to scrutinise our performance in this country to see how it compares with what happens in France. In that way, I could determine whether the claims made about the French railway are accurate or apocryphal. An annual rail efficiency report would therefore do a service to us all, and I hope that the Minister can respond positively to the suggestion.

New clause 6 would require a review of assets to take place every three years, covering all land and other property owned by Network Rail that is redundant to railway use or which has not been used for railway purposes in the preceding 18 months. The review would also contain a statement of intent regarding the future use or disposal of such assets.

On 5 March 2002, the Under-Secretary of State for Transport, the hon. Member for Plymouth, Devonport (Mr. Jamieson), responded to a question by stating that the Strategic Rail Authority had not carried out any evaluation of rail assets at that stage. In the past, there has been some criticism of the lack of information in respect of assets held by the rail network.

I am not necessarily critical of the fact that Network Rail might have some assets that are not currently in use and which are in a temporary limbo. It is justifiable for businesses to have certain assets that they may not use at present but which they may want to use in the future. It would be very short-sighted to force a company such as Network Rail to dispose of assets when it may have tentative plans to bring those assets into use in the future. New clause 6 would not do that: instead, it would require the Secretary of State to produce a list of the relevant assets, and a statement of intent that would tell us what would become of them.

I know that many assets have been realised over recent years, but many redundant assets remaining in Network Rail's asset base could be brought back into use or disposed of. I shall give the Minister an example. The main rail line from St. Pancras to the north has quite a lengthy stretch through Leicestershire that used to have four tracks. As a former regular user of that line, I was aware that two of those tracks were used exclusively for freight and two for passenger services. The reason for having four lines in that stretch was to allow the faster passenger trains to overtake the slower-moving goods vehicles.

The collapse in rail freight a couple of decades ago caused someone in authority to decide that that stretch of line should not have four tracks. As a result, two of the tracks were taken up, but the track bed remains, and the people who manage these assets should be forced to decide whether they will be brought back into use in the future, or whether they should be realised and sold. The benefit of selling an asset that is for the moment dormant is that money is released for other railway purposes.

Both new clauses are reasonable, and the history of our railway network shows why there are surplus assets in many parts of the country that Network Rail could sell. The Stockton to Darlington railway opened in 1821, thus beginning 100 years in which the private sector raised capital for investment. It was a period of strong competition, which caused the original railway companies to lay tracks and purchase assets around the country. Some of those assets are still retained in railway ownership.

We are in a different ball game now. It is right that Network Rail should be forced to justify the assets that it still has, and to indicate whether they will be brought back into use or whether they could be made available for sale.

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

Both new clauses would place a duty on the Secretary of State to publish information or reports. However, they are relatively narrow, in that they concentrate on the financial side of his responsibilities.

New clause 5 deals with rail efficiency and the performance of Network Rail. In passing, a minor criticism is that it does not go far enough. By concentrating on Network Rail, it leaves out a large part of the rail system—the train operating companies, the ROSCOs—rolling stock companies—and so on.

New clause 6 relates specifically to a register of assets. I have no difficulty in supporting the new clauses, because they point the way to one of the deficiencies in the Bill. As the Minister knows, I support the Bill and the principle that the SRA should be abolished, because it is right for the Government to take strategic responsibility for the railway. However, under the present arrangements, the SRA is under a duty to report on the matters mentioned in the new clauses and on a range of other matters. That report is made available to us. In the transfer of duties from the SRA to the Secretary of State, the duty to report has been lost, and the new clauses are intended to restore it.

I am sorry that new clause 4, which I tabled, did not find favour with Mr. Speaker, because it would have fully addressed the requirement to publish the strategy and to report on progress on it. That may be something for the other place to consider.

New clauses 5 and 6 are requests for the publication of information and my colleagues and I are happy to support them. However, I wish that they contained an additional requirement to publish the strategy. The travelling public, as I said on Second Reading, need to see where they are going in the long term and what mileposts should be met along the route.

Mark Francois (Conservative, Rayleigh)

I support my right hon. Friend the Member for East Yorkshire (Mr. Knight) and new clause 5, which calls for the publication of annual rail efficiency report by Network Rail. I should probably declare a small personal interest at this point, inasmuch as the chairman of Network Rail, Mr. Ian McAllister, is a constituent of mine, and I have written to him on the issue that I wish to raise this afternoon.

I wish to back the suggestion for a specific efficiency report, because a good number of my constituents are commuters. Many of them work in the City of London and travel into Liverpool Street station each morning. The efficiency of Network Rail is of considerable importance to them, not least because there are now important capacity issues on the Liverpool Street line. Network Rail, and Railtrack before it, has undertaken work to upgrade the line, both in terms of signalling improvements and initiatives such as lengthening some of the platforms at stations to facilitate the operation of 12-carriage trains, which are obviously more efficient. We also now have the combined franchise, operated by the 'one' group, which has led to some improvement in the co-ordination of services in and out of Liverpool Street, although the new timetable is taking a while to settle down.

Important physical constraints must be faced, however, including a narrow entrance, or neck, in and out of Liverpool Street station, so that it is comparatively difficult to run many more trains in and out, especially during the morning and evening peaks. Incidentally, if we are to see much expansion in house building in the Thames gateway area, that restriction will be an increasing problem, because at least some of the people who will live in those houses will want to commute into London. Ministers will have to be conscious of that.

Mark Field (Conservative, Cities of London and Westminster)

Does my hon. Friend agree that the potential for increased capacity at Fenchurch Street station—used by the constituents of other south Essex Members, if not by his, to come into central London— is also limited. I therefore recognise the issues that he raises about the potentially large increase in housing capacity in the Thames gateway region.

Mark Francois (Conservative, Rayleigh)

My hon. Friend raises an important point. I commuted into Fenchurch Street for some eight years, so I am familiar with that station. It, too, has a very narrow neck. It will be therefore a serious challenge to bring in additional trains from the east of London, because only so many trains will physically fit into so much space. Ministers will have to consider that situation seriously, as will a future Conservative Government.

Speed restrictions still apply in some areas of the track at times, and further upgrade work—especially on some of the bridges, which can be particular choke points in terms of speed restrictions—would probably prove cost-effective in helping the trains to run more smoothly and efficiently. In addition, if we are to have an annual report specifically about efficiency, one area that it should cover is time lost to engineering works, especially when scheduled engineering works take place over a weekend but overrun into Monday morning. The track is opened again later than scheduled, so services during the Monday morning peak are disrupted. I have experienced that myself on several occasions in the past year when travelling to the House.

In a letter I received from Network Rail in November, the company admitted that six such overruns had occurred in the previous nine months, including at least one occasion when the line could not be released until past 9 am, with predictable consequences for commuters struggling into work. Greater effort may be required from Network Rail to try to prevent what should be an avoidable problem that is largely under its own control. They are, after all, the company's works. If Network Rail were required to report on the matter specifically every year, in a way easily accessible to commuters, it might help to focus minds on the problem.

In fairness, I should say that Network Rail has already undertaken some initiatives to try to address the situation, so it is not as if it has ignored the difficulty or pretended that it does not exist. Nevertheless, the problem persists on occasions and greater effort needs to be applied to try to eradicate it. I am grateful for the opportunity to put those points on the record and I look forward to hearing the Minister's comments on the issues, which are of great interest to my constituents.

Tony McNulty (Labour, Harrow East)

I shall start with a few points arising from the contribution by the hon. Member for Rayleigh (Mr. Francois). We fully accept and understand, as we have said repeatedly, that the railways—and other transport dimensions—need the infrastructure commensurate with the developments that are coming in the gateway, in north Kent and south Essex. Clearly, that will have a knock-on effect for assorted London terminals in the constituency of the hon. Member for Cities of London and Westminster (Mr. Field), such as Liverpool Street, which will have to be factored into the mix.

From the Kent perspective—I know that the hon. Member for Rayleigh could care less about that as an Essex Member—the channel tunnel rail link and other changes to the integrated Kent franchise will assist matters and, although they are meeting some resistance, they will redress the balance somewhat in terms of the numbers of trains going into Cannon Street, Fenchurch Street and St. Pancras. The changes are causing some disquiet among Kent commuters who have taken trains into Cannon Street for ever, and we will have to take into account how they will be affected.

The hon. Gentleman also mentioned overruns. Engineering works need to be signed off only when it is safe to do so, and sometimes that means a couple of hours overrun with all the knock-on effects on the network. It is a fine balance, and Network Rail is getting better at it, but I cannot say that it will never happen again. In some cases, the safety considerations outweigh whatever delay and disruption may occur at that crucial time for commuters on a Monday morning. Safety must remain the key focal point.

Mark Field (Conservative, Cities of London and Westminster)

In view of the cost implications of finding land in central London at Fenchurch Street station or Cannon Street, does the Minister think that we should have hubs in Finsbury Park, Stratford—which, in a sense, is already a hub—or the other side of London Bridge station, to provide larger capacity? Should we have new or enlarged stations outside the central zone stations that already exist? If so, is that the sort of initiative that should be replicated in other large cities, where the sheer cost and inconvenience of developing existing stations in the centre means that it is wise to consider areas in the suburbs for development?

Tony McNulty (Labour, Harrow East)

I think the answer is yes to some extent, but clearly it is dependent, whether it is in central London or elsewhere, on the existing hub and network reality as well as the potential for developing things further. The hon. Gentleman and other hon. Members know that we are seeking to overcome precisely such difficulties at Birmingham New Street. There will be a reconfiguration, once the channel tunnel rail link is up and running by 2009, in terms of the balance between the King's Cross/St. Pancras complex and a number of the channel tunnel rail link stations in the hon. Gentleman's constituency. As and when Thameslink 2000 is taken forward—perhaps the 2000 should be in inverted commas; I do not know—much of the real work there that will have a profound impact particularly on the southern commuter lines will be around the viaducts and bridges of Borough and the throat into London Bridge, and that will have serious ramifications in terms of enhancing capacity and efficiency.

So a number of things can be done. Finsbury Park, which the hon. Gentleman mentioned, is a mini-hub already and by the end of this work we shall have a very substantial hub at Stratford, with 10 or 11 lines going into it. If we are moving on to developments similar to those at Stratford, if there is an opportunity to make them transport hubs if they are close to but not in the centre—almost suburban but not quite; the hon. Gentleman will know what I mean—we should avail ourselves of that opportunity.

That leads me neatly to new clause 6 rather than new clause 5, and I will deal with both in detail after I have given way.

Mark Francois (Conservative, Rayleigh)

I thank the Minister for his courtesy in giving way. May I say for the record that even though I am an Essex MP I have considerable sympathy with Kent commuters because they face many of the problems as my constituents do commuting in from Essex? But on infrastructure, the Minister may be aware that the East of England regional assembly voted for increased housing targets in November 2004 and then effectively abrogated that plan in December 2004, specifically because of a lack of transport infrastructure to accommodate house building on that scale. To be fair to the Minister, he has shown some awareness of the problem, but we cannot stress enough how important addressing this is going to be.

Tony McNulty (Labour, Harrow East)

To be honest, the assembly did not abrogate it; it simply looked again and did not go quite as far as it had earlier in terms of numbers. That is slightly different from a complete abrogation of what it passed in the first instance. But without getting too far off the point and the matters before us, there is a £200 million pot for the community infrastructure fund to take up smaller projects and schemes throughout the gateway and the other growth areas that we are progressing, and at the last count the currently committed spending just in the gateway in terms of transport infrastructure has been the best part of some £900 million—close to £1 billion; we have said time and again that of course the two must go together.

The point that I was going to end on in speaking about stations was that while I have sympathy with new clauses 5 and 6, for reasons that I shall explain I believe that both are unnecessary. But this point was raised at Second Reading and I do have some sympathy with it and am trying to pursue this more readily with Network Rail. It is not about its asset base; principally the land that it holds is operational rail land and not much more, and I shall return to that in detail. But there is an issue about what Network Rail can do in a proactive fashion around assorted termini to improve, and maybe enhance, passenger flow and so on by working far more readily than it has done thus far with the private sector, with the development industry, not only across the obvious London termini where there is clearly a commercial attraction but in other towns and cities too, and on a smaller level, to capture some sort of development gain. Network Rail has not been very good at that; I have told a constituent of the hon. Member for Rayleigh that to his face, so I am not talking out of turn. There is much more that can be done to turn our key termini far more readily into the transport interchanges and flourishing commercial ventures that they could be, perhaps far more so than they are now. I am exploring that and trying to move on with Network rail in that regard.

If I may, I shall "return to the clauses" but I am not sure that I had got to them yet. New clause 5 calls upon the Secretary of State to publish an annual assessment of the performance and efficiency of Network Rail in the form of a "rail efficiency report", with what the right hon. Member for East Yorkshire suggested about EU comparative data. The independent Office of Rail Regulation already carries out such an annual assessment, in the form of—I fully accept that it does not trip off the tongue as lightly as "rail efficiency report"—its annual statement on Network Rail's stewardship of the national rail network. It is a different label but it does capture, I would suggest, what the right hon. Gentleman is after. Its first such report covered primarily the year April 2003 to March 2004 and was published in November 2004. A rail efficiency report, I would contend, would therefore create unnecessary duplication.

The key function of the ORR is to monitor the performance and cost-effectiveness of Network Rail. The "Statement on Network Rail's Stewardship of the National Rail Network 2003–04" is an evaluation of the extent to which Network Rail met the stewardship requirements of its network licence, regulatory targets, and those targets identified in the business plan for April 2003 to March 2004. It covers all aspects of Network Rail's stewardship—expenditure, maintenance, renewal, enhancement, asset knowledge, operations, performance and monitoring. It consolidates the analysis carried out during the year by the regulator and allows Network Rail's customers, funders, members, users and other stakeholders to see how efficiently Network Rail is managing this important national asset. The Secretary of State will publish the ORR's second annual statement in autumn 2005.

I fully understand that in some ways that does not quite capture the reasons for the overruns and the reasons for the lack of efficiency, but they will be and are captured in other ways. As Minister with responsibility for rail, I have a meeting once a month with all the parties concerned, including Network Rail, just on performance of the various aspects of the rail industry, when those matters are explored further, but I do think this document does largely capture what the right hon. Gentleman rightly suggests should be in such an efficiency report. It sets out the regulatory calendar for the scrutiny of Network Rail's business plan and delivery against it. It includes an annual return, regulatory accounts and a quarterly statement, and the statement is presented as a balanced scorecard of high-level indicators that measure the extent to which Network Rail is achieving improvements and targets in a number of key areas of performance: safety, train performance, asset performance, activity volumes, finance, customer satisfaction and supplier satisfaction.

The views of consultees are sought on whether these indicators are the right ones, whether they need to be expanded to reflect Network Rail's broader responsibilities following the rail review, and the frequency with which they should be published. We are consulting on that now as we speak. Data comparing Network Rail's performance with that of rail companies operating partly or wholly within the European Union are currently not available. Whilst the European Commission would like to enhance benchmarking data, there is no prospect of any meaningful data becoming available for the foreseeable future, but I do take the right hon. Gentleman's point and we shall continue to look to the ORR, in carrying out its periodic reviews, to conduct research looking at benchmarking performance with other selected comparators that are appropriate comparators with other EU countries, to inform its assessment of Network Rail's performance and efficient gains. I understand that this was the approach taken in the last periodic review.

I think that overall, given especially the shift of emphasis in terms of ORR and what it can do should the Bill receive Royal Assent, that would be a more effective approach than simply having an efficiency report by the Secretary of State. I would say too that many of the things we are doing outside the Bill would lend themselves more readily to trying to capture that performance assessment at the local level. We are requiring Network Rail to work much more closely with train operating companies on a franchise-by-franchise, region-by-region basis. Invariably, that is through a key integrated control centre, where Network Rail, the train operating company, and the rolling stock company if necessary, all sit side by side to manage that part of the network more efficiently.

When the centres are up and running more readily—I think that the next to go on stream will be the East Anglian one based at Liverpool Street—proper communication and information flow will give us more realistic reasons why overruns occur. The hon. Member for Rayleigh and the right hon. Member for East Yorkshire suggested that all such information is available and I would not demur from that.

Although I understand the impetus behind new clause 6, which would provide for a triennial register of Network Rail's land and property assets that were redundant or had not been used for eighteen months, I am not sure that I would go along with it. Perhaps it would be helpful if I explained the background to the management and disposal of railway land. At the time of privatisation, the ownership of operational railway land was transferred to Railtrack, and subsequently Network Rail. The British Railways Board retained the non-operational land and buildings. That estate was transferred to BRB (Residuary) Ltd, a subsidiary of the Strategic Rail Authority, upon the SRA's establishment in 2001.

As part of the periodic review process, Network Rail is encouraged to maximise its income from all sources, including the redevelopment of its land and property, by exploiting appropriate disposal opportunities. However, a balance is needed to ensure that future rail development opportunities are not sacrificed for short-term financial gain through disposals. As everyone knows, Network Rail is regulated by the Office of Rail Regulation, and it must seek the ORR's consent before making arrangements for land disposal.

I do not know about the specific piece of two-track line in Leicestershire that used to be the four-track line to which the right hon. Member for East Yorkshire referred. If there is any possible reason why that might be four-tracked again in the future, I would rather that is was left as it is and protected than for anything else to happen to it. That does not mean that something is imminent for that specific stretch. I am simply saying that it is sometimes appropriate for land to be held for more than 18 months—the time cited in new clause 6—pending future development.

Michael Spicer (Conservative, West Worcestershire)

Of course I take the point that land which is redundant today might not be redundant tomorrow. Just before privatisation, a lot of land became redundant because of the inefficiency of the railways under nationalisation. Privatisation led to more demand, and although we now want the duelling of track throughout my constituency, we did not want that under nationalisation. However, surely that does not negate the value of reporting to the House about what is thought to be operationally viable in the future or redundant in the way envisaged by new clause 6. Why not keep the House of Commons informed?

Tony McNulty (Labour, Harrow East)

I am not saying that the House of Commons or anyone else should not be informed, but the ORR and Network Rail have a relationship in the first instance through which they can consider what happens to land. Let me go into a bit more detail, although we can return to the matter if hon. Members wish.

Network Rail's forecast income from property was closely scrutinised by the ORR as part of the access charges review in 2003, precisely to ensure that Network Rail was maximising the revenue generating potential of its property portfolio. In the conclusions of the review, the ORR determined that Network Rail should earn £1.2 billion in property income over the five years from 1 April 2004, which was £50 million more than Network Rail had forecast. That is clearly a challenging target, but assets, buildings and other portfolios do not stand idle while people decide what to do with them, because they form part of Network Rail's overall budget. As has been said, it is clearly best for Network Rail to determine how best to manage its property portfolio from day to day to optimise revenue earned from that without compromising its core business of operating, maintaining and renewing the rail network. It would not be terribly appropriate for civil servants or politicians to get involved in that process.

The ORR thus already regulates and monitors the disposal of Network Rail's land and property. Network Rail's network licence includes a condition that was imposed by the rail regulator to prevent the disposal of land by Network Rail unless the ORR consents to such disposal. When reaching a decision, the ORR will consult various railway industry stakeholders for their views. Consent is likely to be refused if the land could be important to the continuing operation and further development of the network, as I said.

The purpose of the licence condition is to ensure that parts of the Network Rail property portfolio that might be required for the future development of the railway are retained for that purpose. If consent is given, which may be for an individual case or in accordance with a general consent covering specified categories of land, the decision on whether, when and how land should be disposed is a commercial one for Network Rail.

A balance must be struck between what the ORR reports about the previous disposal and utilisation of assets and the real commercial considerations of the ORR and Network Rail. Many of the suggestions made by the right hon. Member for East Yorkshire are covered in one way or another by the relationship between the ORR and Network Rail. However, the arbitrary time frames in new clause 6 are not appropriate. When the post-SRA world settles down, I am more than happy to ensure that the right hon. Gentleman, his colleagues and anyone else who needs to know are aware of Network Rail's assets register, land holdings and the targets for the next periodic review. In that context, I would suggest that most of the concerns addressed by new clauses 5 and 6 either have been covered already, or are well on their way to being covered. Although I accept the substance of the right hon. Gentleman's points, I hope that he will withdraw the motion.

Greg Knight (Conservative, East Yorkshire)

We have had a worthwhile debate. The hon. Member for Caithness, Sutherland and Easter Ross (John Thurso) criticised what he described as the narrow drafting of the new clauses, but accepted the thrust of the argument behind them. I suppose it was a case of praising with faint damns, but I thank him for his qualified support.

My hon. Friend the Member for Rayleigh (Mr. Francois) drew the House's attention to specific problems occurring in his part of the country, and I am sure that the Minister will reflect on his comments. My hon. Friend made a telling point when he said that bridges on some parts of the network are choke points. They are indeed a big problem on a large part of the network, and in many cases they prevent the network from being opened up to increased freight business. If redundant assets could be sold to fund bridge replacement work, both passengers and freight customers would benefit.

We take the Minister's point about retaining—where appropriate—currently unused railway land if there are plans to bring it into use in future. We accept that, of course, but it was not part of the aim we sought to achieve through new clause 6. I was delighted to hear that the hon. Gentleman accepts that Network Rail could do more and be more proactive about enhancing passenger flow. We give him two cheers for clearly acknowledging that more could be done. I hope that as long as he is a Transport Minister, he will stay on the case and ensure that Network Rail is indeed more active in improving the quality of travel for passengers. In the light of his response and of the fact that the Minister acknowledges that there is a problem, I shall not pursue new clause 6 any further.

I was less convinced by the Minister's response to new clause 5. There is a case for saying that as long as the railways remain under the wing of the Secretary of State, the Secretary of State should be answerable to the House and should have a duty to publish a rail efficiency report—if only to focus his mind and ours on the fact that more could and should be done to improve rail efficiency. Although I thank the Minister for his comprehensive response, I still have some doubts regarding new clause 5, and when in doubt one should always take the mood of the House.

New Clause 9 — Railway Strategy for Wales

Elfyn Llwyd (Plaid Cymru, Meirionnydd Nant Conwy)

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

Sylvia Heal (Deputy Speaker, Halesowen and Rowley Regis)

With this, it will be convenient to take the following amendments:

No. 33, in clause 10, page 9, line 14, leave out "Wales-only", insert "any Welsh".

No. 36, in clause 12, page 11, line 13, at end insert—

'(da) the National Assembly for Wales.'

No. 38, in clause 22, page 21, line 2, at end insert—

'(aa) in relation to a proposal relating to services all of which are Wales-only services, means the National Assembly for Wales; and'.

No. 39, in clause 23, page 22, line 9, at end insert—

'(aa) in relation to a proposal relating to services all of which are Wales-only services, means the National Assembly for Wales; and'.

No. 41, in clause 25, page 24, line 47, at end insert—

"(aa) in relation to a proposal relating to one or more services each of which is—

(i) a Wales-only service, or

(ii) a cross-border service in relation to which so much of the funding as is provided by a railway funding authority is funding provided by the National Assembly for Wales,

means the National Assembly for Wales; and".

No. 48, in clause 30, page 31, line 36, at end insert—

"(aa) in relation to a proposal relating to a station or part of a station that is wholly in Wales, means the National Assembly for Wales; and".

No. 49, in page 31, line 38, leave out 'and Wales'.

No. 50, in clause 31, page 32, line 45, at end insert—

'"(aa) in relation to a proposal relating to a station or part of a station that is wholly in Wales, means the National Assembly for Wales; and'.

No. 51, in page 32, line 47, leave out 'and Wales'.

No. 59, in schedule 9, page 114, line 19, at end insert—

'"(ba) where the relevant assets by reference to which the bye-laws are or were made are all Welsh assets, the National Assembly for Wales;

(bb) where some but not all of those assets are Welsh assets or include assets that are used partly in Wales and partly elsewhere, the Secretary of State and the National Assembly for Wales; and".'.

No. 57, in page 114, line 37, at end insert—

'(4) In sub-paragraph (1) "Welsh asset" means—

(a) an asset that is permanently situated in Wales; or

(b) an asset that is used only in Wales.

(5) In the case of bye-laws in relation to which both the Secretary of State and the National Assembly for Wales are the appropriate national authority—

(a) anything that must be done under this Schedule in relation to those bye-laws by the appropriate national authority must be done by them both, acting jointly;

(b) anything that may be done under this Schedule in relation to those bye-laws by the appropriate national authority may be done only by them both acting jointly; and

(c) any requirement of this Schedule in relation to those bye-laws to send something to the appropriate national authority is complied with only if that thing is sent both to the Secretary of State and to the National Assembly for Wales.'.

Elfyn Llwyd (Plaid Cymru, Meirionnydd Nant Conwy)

I make no apology for spending a little time on new clause 9 and the amendments grouped with it. They were requested by the National Assembly for Wales, not because Plaid Cymru Members asked for them, but because the Economic Development and Transport Committee of the National Assembly, chaired by Christine Gwyther AM, a former new Labour Minister of the Assembly, was concerned that they should be included in the Bill. To make matters slightly worse, and to add insult to injury, the Assembly had requested overall control of the railways in a measure in the Queen's Speech, but that proposal was dispatched with very little regard.

Before I speak to the amendments, I wish to refer to a letter written by Christine Gwyther on 14 January 2005 to the Chairmen of the Railways Bill Committee. She says that her committee was

"very conscious that the timetable set for the Parliamentary process is very tight and that this has put your Committee under enormous pressure in its scrutiny of the Bill. While this is not a matter for you, my Members were disappointed that the timing of this most important piece of legislation allowed so little time for wider consideration, or for the National Assembly to consider the Bill in much detail . . . The Committee's overall view was that the Bill marked a major stage in the development of the Railways in Britain and provided an opportunity for a comprehensive transfer of powers over Welsh railways to the National Assembly. Members noted the substantial range of powers that it conferred on the Scottish Executive and were disappointed that the Secretary of State for Transport was retaining many of these powers in relation to Wales. A particular concern was the failure of the Bill to transfer to the National Assembly control over the infrastructure in Wales. Clearly, it is too late to make fundamental changes to the Bill, but there are two specific points which the Committee felt could easily be changed:

Members were concerned about the lack of control Wales would have over closures where the Assembly is not funding the rail service. Clauses 22 to 31 refer to National Authorities being notified of any closure proposal and then carrying out a consultation on this. However, while the Scottish Executive is the National Authority in Scotland, the Secretary of State for Transport would undertake this function in Wales. Members cannot see any reason why the National Assembly should not have this responsibility in Wales and urged you to amend the Bill accordingly.

Finally, the letter states:

"One other anomaly relates to the confirming of bye-laws. The National Assembly already has extensive powers in this regard and the Committee cannot see why it should not have the same powers as Scottish Ministers in relation to schedule 9. This could be achieved by amending Paragraph 1 of that schedule to include the National Assembly for Wales as the appropriate national authority for bye-laws relating to Welsh assets, with similar provisions to those relating to Scotland in relation to cross-border bye-laws."

I have quoted extensively from that letter since I believe that it is important not only in itself, but with regard to further issues. We are always told about the successful partnership between the National Assembly for Wales and this place and that the way in which legislation works, as and when it is necessary, is that it is called for by the Welsh Assembly and put in train by Ministers in this place. This is a classic example where the devolution process breaks down utterly. For whatever reason, the pleas of the Assembly, the cross-party committee and the letter penned by the ex-new Labour Minister who chairs that committee have been ignored utterly by the Committee in this place. Its members had the representations in good time to table amendments. Indeed, amendments were tabled, and they are now being discussed.

I have dealt with those points at length because I hope that somebody more kindly disposed to the devolution process in the other place will take them up. They are important if we are indeed going to refer to any form of partnership between the National Assembly for Wales and this place pro tem in any event.

I shall not read out the new clause, as other Members have important amendments to speak to later, but I wish to make a brief point. The new clause emulates the provision for Scotland and falls very well into the rest of the Bill, which gives the Assembly power to spend money on rail services. It calls for a railway strategy for Wales, which would guide decisions about where to put money and what money to put in. The Transport (Wales) Bill requires the Assembly to draw up a Wales transport strategy. A railway strategy could be a part of that, but in our view, it needs to be mentioned in the Railways Bill, as it needs to be an input into the Secretary of State's decisions about railways, particularly if the other amendments that we have tabled to strengthen the Assembly's powers are rejected.

Amendment No. 33 deletes "Wales-only" and inserts "any Welsh". The purport of that is to give the Assembly a consultation role in any proposed franchise agreements which include Welsh stations, for example Paddington to Swansea, rather than to confine it to services run entirely within Wales.

Amendment No. 36 inserts a new subsection and adds the Assembly to the list of bodies that can own railway assets following the end of a franchise. One of the issues strongly raised by Miss Gwyther was the need for the infrastructure to be in the hands of the National Assembly.

Amendment No. 38 adds the Assembly to the national authorities—currently just the Scottish Executive and the Secretary of State— which must

"consider whether the closure in question should be allowed."

That comes from subsection (6). This is a proposal from a service operator to discontinue a service that the franchise does not require the operator to run and which, if it is decided to delete it, should not be allowed to run. Therefore this is to secure the provision of services.

Amendment No. 39 adds the Assembly to the definition of national authorities that must consider proposals coming from funding authorities, rather than service operators, to discontinue a service that may not be required under the franchise agreement.

Amendment No. 41 adds the Assembly to the national authorities that must consider proposals coming from service operators to discontinue excluded services, which are basically services other than ordinary passenger services. The wording emulates that which applies to Scotland.

Amendment No. 48 again adds the Assembly to the national authorities that must keep a station in operation if the Office of Rail Regulation turns down under subsection (7) a proposal from a funding authority to stop funding it.

Amendment No. 59 gives the Assembly power to make railway byelaws. Miss Gwyther specifically asked for this in her letter to the Committee. I ask the Minister to address these points, as I am sure he will. I felt it necessary to put them on the record because the last thing we want is for the National Assembly to feel that it has been entirely excluded from the process. I realise that the request came rather late to the Committee. Nevertheless, the request was plainly made well before today.

Amendment No. 50 adds the Assembly to the national authorities that must keep a "secured" station in operation if the ORR turns down under subsection (7) a proposal from a funding authority to cease funding it.

Amendment No. 57 backs up the previous amendment in the same way and emulates what is happening in Scottish byelaws, defining which byelaws can be made.

My hon. Friends and I have tabled this bank of amendments. Although they were mainly drafted by Members of our party, the purport of them came from every political party in the National Assembly, as represented on the Committee chaired by Miss Gwyther. I ask the Minister to give serious consideration to each and every one of them. I am not prejudging the issue, but if the Minister is unable so to do, I hope that someone in the other place more generously disposed to the devolution process might deal with them. The matters are important. I am not simply making political points; I am trying to make the point that we need this to be done for the railways infrastructure in Wales to be properly controlled.

Jeremy Corbyn (Labour, Islington North)

What is the boundary for rail infrastructure in Wales, because the link lines between north and south Wales partly run through England? In the hon. Gentleman's view, should those lines be included in the Wales franchise?

Elfyn Llwyd (Plaid Cymru, Meirionnydd Nant Conwy)

The Welsh Assembly should be properly consulted with regard to the important rail service from Swansea to Paddington. I am not saying that it should control lines outside the Welsh border, but it should be consulted properly and its views should be taken into account, which is not the current situation with regard to the cross-party committee. I hope that I have made the point, and I ask the Minister to respond in as much detail as possible.

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

Before I address the new clause and amendments introduced by the hon. Member for Meirionnydd Nant Conwy (Mr. Llwyd), I shall refer to the amendments tabled by the hon. Member for Ceredigion (Mr. Thomas) in Committee. I am sure that there was a good reason why the hon. Member for Ceredigion was not in Committee when we reached those amendments. I am sorry that they were not moved, because I sympathise with them.

Elfyn Llwyd (Plaid Cymru, Meirionnydd Nant Conwy)

My hon. Friend the Member for Ceredigion (Mr. Thomas) experienced a flooding incident in his flat.

Tony McNulty (Labour, Harrow East)

For seven sittings?

Elfyn Llwyd (Plaid Cymru, Meirionnydd Nant Conwy)

For some unearthly reason, the message did not get through to the Clerk or the Chair, and I apologise for that on his behalf.

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

I am grateful to the hon. Gentleman for that explanation. If one's flat is flooded, it is a serious occurrence, which explains why the hon. Member for Ceredigion was not present on that morning. I sympathise with the amendments, and if I had known about the situation, I might have put my name to them.

New clause 9 and the amendments relate to the asymmetry of the devolution settlement in this country. In Scotland, we enjoy a Parliament with full powers, whereas the Welsh Assembly has powers over secondary legislation only. It is fairly well known that my party would like Wales to be blessed with a Parliament as opposed to an Assembly.

In broad terms, I can see no reason why Wales should not be permitted the same devolutionary responsibilities as Scotland. Some difficulties exist, and the hon. Member for Islington, North (Jeremy Corbyn) has made the point that whereas the Scottish railway system is almost wholly in Scotland and has two well-defined routes in the west and the east, the situation is more complex in Wales, because the railways dip in and out of England. That difficulty in formulating strategy is not apparent in Scotland.

On the principle of the matter, the Welsh Assembly should be permitted as much say in the railways as possible. I have said this before, and I am sure that I will say it again: the correct principle for devolution is that what can be devolved should be devolved. Assembly Members—in particular, Jenny Randerson, who speaks for the Liberal Democrats on such matters—have contacted me to make the point that all parties would like to see a greater role for the Welsh Assembly. I hope that the Government will listen with some sympathy to the points that have been made and consider—if not today, in another place—how they might fulfil the legitimate aspirations for devolution expressed by the hon. Member for Meirionnydd Nant Conwy.

Tony McNulty (Labour, Harrow East)

I do not doubt that these are serious matters. Nor do I doubt that the hon. Member for Ceredigion (Mr. Thomas), who sat—or rather, did not sit—for Plaid Cymru on the Committee, had difficulties on the day that the amendments should have been debated. These amendments should therefore be treated with all due consideration and regard, and in detail, and I shall try to respond to them in that context. However, the record should show that the inundation took place on only one sitting day. The hon. Member for Ceredigion popped along to see us for about half an hour on the first day that we sat and was not there for the remaining seven sittings. That is a matter of regret, not least for the hon. Member for Caithness, Sutherland and Easter Ross (John Thurso), who, as he said, would have wanted to discuss the amendments had that been possible. I understand about the flood, but to turn up for only one sitting, albeit with an excuse for one of the others, is not a terribly good batting average for any member of any Committee.

New clause 9 seeks a power for the National Assembly for Wales to prepare and publish railway strategies for Wales that is equivalent to Scottish Ministers' powers in relation to Scottish railway strategies in clause 5. I contend that that is unnecessary. The Secretary of State has overall policy responsibility for the strategic direction of the railway in England and Wales. Scottish Ministers have the power to prepare a railway strategy because they have equivalent franchising and network functions in Scotland to those of the Secretary of State in England and Wales. I understand that the hon. Member for Meirionnydd Nant Conwy (Mr. Llwyd) addresses those points in later amendments, which I shall deal with in due course.

Although the Bill does not place a statutory duty on the Secretary of State to publish railway strategies in the same way that section 206 of the Transport Act 2000 makes it a duty of the Strategic Rail Authority to publish such strategies, he will have an overall strategy for the railway. From time to time, the Department for Transport will undoubtedly publish documents that set out his objectives in this regard. The Department will certainly consult the National Assembly for Wales as a matter of course when preparing any strategies that affect Wales.

The Bill already requires the Secretary of State to consult the Assembly before exercising certain key functions: for example, before he gives general guidance to the Office of Rail Regulation as to that body's exercise of its functions, which is in clause 3; before he publishes a statement of policy on franchising, which is in schedule 1; and before issuing invitations to tender for franchises that provide or include Welsh services or entering into such a franchise without a tendering process, which is in clause 10. The Bill already has elements that take full account of the need to consult the Assembly.

Moreover, there is nothing in the Bill to prevent the Assembly from preparing and publishing its own strategy for the Welsh railway. As the hon. Member for Meirionnydd Nant Conwy will know, it already funds a significant programme of rail investment as part of its policy of developing an integrated transport system, which is set out in its document, "The Transport Framework for Wales". Clause 3 anticipates the Assembly's strategies. It provides that the Office of Rail Regulation must have regard to any Assembly's railway policies or strategies notified to it when exercising its functions under part 1 of the Railways Act 1993 and the Bill. Subsection (8) says that the ORR must

"have regard to any notified strategies and policies of the National Assembly for Wales, so far as they relate to Welsh services or to any other matter in or as regards Wales that concerns railways or railway services".

The provision therefore already exists. There is a logic and integrity to the Bill's provisions for Wales and the National Assembly. I know that the hon. Gentleman wants to go much further and I shall deal with the amendments that try to achieve that shortly. However, the measure's logic reflects the asymmetrical democracy that exists through devolution in this country. As the hon. Member for Caithness, Sutherland and Easter Ross said, it reflects the relative weight, power and functions of the respective institutions.

Elfyn Llwyd (Plaid Cymru, Meirionnydd Nant Conwy)

I am genuinely grateful for the detail that the Minister is providing in his response. However, the debate echoes what was said when the Strategic Rail Authority was set up. People in Wales felt that there should have been either a separate Welsh branch of the SRA or a strong Welsh representation. However, I repeat that I am grateful to the Minister for going into such detail.

Tony McNulty (Labour, Harrow East)

I do not doubt that the hon. Gentleman is right. He will understand that I did not follow the debate on establishing the SRA with the same attention to detail and interest with which I am following the current debate, for obvious reasons. However, in the past year or two, the SRA has moved more readily towards a regional focus and taken account of the regional sensitivities that exist throughout the United Kingdom. We do not want to lose that in replicating the SRA functions that the Department for Transport rail unit, rather than the SRA, will cover.

Amendment No. 33 would give the Assembly a great deal more power—more power than Scottish Ministers would enjoy. It would make the National Assembly and the Secretary of State joint signatories to all the English franchises that cross the border into Wales. The Scottish Ministers will not have that power for the east and west coast franchises—the rough parallel that one could draw.

The core of the Bill as it relates to Wales is the Assembly's role in the Arriva Trains Wales franchise. That is the only franchise that currently provides what the Bill defines as "Wales-only services". As drafted, the Bill gives the Assembly the right to be a joint signatory with the Secretary of State to the Arriva Trains Wales franchise, thus recognising the importance of that franchise to Wales.

Clause 10(1) deals with the other important relationship between the Secretary of State and the National Assembly: on consultation about all franchises that serve Wales. My hon. Friend the Member for Islington, North (Jeremy Corbyn) made that point earlier. The Assembly will have the clear right to be consulted about franchises that provide Welsh services. That will give the Assembly the opportunity to say what it would like to achieve for Wales from them. It will also be able to use the broad powers in clause 10 to provide financial assistance to secure additional services from the relevant franchisee.

If he considered it appropriate, the Secretary of State could invite the National Assembly to be a joint signatory to a franchise that provided Welsh services—for example, if the Assembly wished to secure significant services via the franchise. Clause 10(3) enables him to do that. However, it is right that that remains a flexible option. I do not therefore believe that amendment No. 33 is necessary.

Amendment No. 36 would enable the Assembly to be the recipient of franchise assets at the end of a franchise agreement. At the end of the term of a franchise in England and Wales, it will be the Secretary of State's responsibility to make a transfer scheme in relation to the franchise assets. In Scotland, that role will be performed by Scottish Ministers.

Clause 12 sets out the parties to whom the franchise assets may transfer. They include the Secretary of State, the Scottish Ministers or a company that is either wholly or jointly owned by the Secretary of State and the Scottish Ministers, and a franchise company. The Secretary of State must consult every party to which he proposes to transfer assets before making the transfer scheme.

The primary intention of the clause is to transfer designated franchise assets at the end of the franchise to the new operator of train services. In the vast majority of cases, the new operator will be the new private sector franchisee. A transfer scheme will be made to transfer the franchise assets from the old franchise company to the new one. The out-going company will be paid by the in-coming train operator for the franchise assets in accordance with the terms of the franchise agreement.

In a small number of cases, the Secretary of State, Scottish Ministers or companies owned by them will operate a train service as the operator of last resort on a temporary basis. Assets such as ticket machines and office equipment will therefore have to be transferred to those bodies to allow them to provide the service. There is no provision in the Bill for the National Assembly for Wales to operate services as the operator of last resort. The Assembly is therefore not included in the list of bodies that can receive a transfer of franchise assets.

That does not prevent the Assembly from owning certain assets in relation to a franchise. For example, if the Assembly were to invest in the Arriva Trains Wales franchise and there were certain assets that it considered should remain the responsibility of the Assembly, those assets need not be designated as franchise assets. The franchise agreement could clearly state that those assets were not among the franchise assets and were to be returned to the Assembly, which would then decide how they were to be used. On replacing the Arriva Trains Wales franchise in future, it would be for the Assembly to decide how it wished such assets to be used by the new franchise operator. The Assembly will of course be involved in the re-letting process, and will be consulted by the Secretary of State about that franchise and all franchises that serve Wales. However the ultimate statutory responsibility rests with the Secretary of State. I am therefore convinced that amendment No. 36 is unnecessary.

I understand the import of amendments Nos. 38, 39, 41 and 48 to 51, which all seek to make the National Assembly for Wales the national authority in Wales for the purposes of clauses that deal with network modifications. At present, the Secretary of State has that role. The amendments, if accepted, would give the Assembly the same status in Wales as Scottish Ministers have in Scotland in this regard. Throughout clauses 22 to 31, the only national authorities are the Secretary of State and Scottish Ministers. Scottish Ministers have this duty for all services, stations and networks wholly within Scotland and for some cross-border services; it rests with the Secretary of State in all other circumstances. This reflects and is part of the much wider devolution of responsibility for railway policy and funding to Scottish Ministers. Apart from in a few important areas such as safety, Scottish Ministers now have policy responsibility for all aspects of Scotland's railway. That makes it appropriate for them to be the national authority in the circumstances that I have just described.

As hon. Members have pointed out, that devolution settlement has not been extended to Wales. Under the Bill, devolution of railway policy and funding to the Assembly is much less extensive than to Scottish Ministers, and I fully accept that that is the cause of the complaint by the hon. Member for Meirionnydd Nant Conwy. The Assembly is taking on responsibility for franchising services in Wales, and those starting and finishing in Wales, through the Arriva Trains Wales franchise. However, the Secretary of State continues to have a major role relating to the railway in Wales—in specifying high-level outputs for the railway under schedule 4 to the Bill and funding the network, for example. Part of the reason for this is that the network in Wales is much less discrete an entity than the network in Scotland, which makes fuller devolution difficult at present.

That being the case, it would be inappropriate for the Assembly to be the national authority for the purposes of this clause. Retaining this role for the Secretary of State fits better with the more general approach to devolving railway responsibilities to the Assembly, and is also simpler and more straightforward. Of course, in acting as the national authority for the purposes of the clause, the Secretary of State will need to consult and work closely with the National Assembly. There is already a requirement in schedule 7 for the Assembly to be a statutory consultee in relation to all closure proposals affecting Wales. Backing this up will be the extensive formal and informal discussions envisaged in the memorandum of understanding between the Secretary of State and the National Assembly.

Hywel Williams (Plaid Cymru, Caernarfon)

Does the Minister accept that some services, such as those operating on the Fishguard and Cardiff to Paddington line and those running along the north Wales coast, effectively serve local communities? They are mainline train services, but people use them in the same way as they would use a regional network such as Arriva, which operates within Wales. How would the Assembly discharge its responsibilities in regard to lines which the Minister would say start in Wales and end in England?

Tony McNulty (Labour, Harrow East)

I accept that point, which alludes to the complexities of the issue. Equally, portions, and no more than portions, of many of our high-speed lines in an English context will be utilised as inter-communal lines as well in various parts of the country. In terms of the examples given, and specifically the Assembly, such matters will be worked out between the provisions in the Bill relating to Wales, which I have described thus far and will come on to describe, and the memorandum of understanding to which I have just alluded. In those or other circumstances in which an Assembly viewpoint should be given in discussions on any aspect of rail services in Wales, there should be no blockage on that view being reflected. We are not simply in the business of imposing from the centre what view should prevail in terms of the Welsh rail network. Equally, we are trying to work with the Assembly around the complexities to which the hon. Gentleman and others have alluded. I am trying to do so by taking the amendments as seriously as I can and in the spirit in which they were suggested. The memorandum will pick up many of those complexities, beyond what is not already reflected in the Bill.

For those reasons, we do not think it appropriate for the Assembly to be a national authority for the purposes of this clause. As I have said, retaining the role for the Secretary of State fits better with the more general approach to devolving railway responsibilities to the Assembly and is simpler and more straightforward. As I have said, there will be a consultation and memorandum.

Although the National Assembly is not a national authority, it has a significant role in closure procedures in Wales. In addition to being a statutory consultee, as I have said, it has a duty to provide closure guidance jointly with the Secretary of State for stations or networks in Wales and services in Wales, including cross-border services. I hope that the hon. Member for Meirionnydd Nant Conwy will have seen—if not, they are in the Library—the headlines of the closure guidance, and I promised no more than that in Committee. Consultation will take place with the Assembly to come to some broad agreement on what specifically those should be in relation to Wales, as they need to be published jointly with the Secretary of State, as I suggested. The Assembly is also a designated railway funding authority under clause 44 of the Bill. The effect of that and the Assembly's funding of the Arriva Wales franchise will be that the Assembly will have the power to initiate closure proposals for the services that it funds through the Arriva Wales franchise. In that context, although I understand the import and thrust of that series of amendments, they are not absolutely necessary.

Amendments Nos. 57 and 59, taken together, to which the hon. Member for Meirionnydd Nant Conwy alluded, seek to amend schedule 9 to replicate in Wales the arrangements for confirmation of railway byelaws, before they come into effect, that apply in Scotland. More specifically, the amendments would mean that where the byelaws affect only railway assets in Wales, they would need to be confirmed by the National Assembly. Where the byelaws affect railway assets including those in Wales, they would need to be confirmed by both the Welsh Assembly and the Secretary of State.

As currently drafted, the Bill makes the Secretary of State responsible for approving the byelaws of all railway operators wherever assets are located or used in England and Wales. This role is consistent with the Secretary of State's overall responsibility for the railway network in England and Wales. In Scotland, the Scottish Ministers have overall responsibility, hence their role in approving byelaws. I can understand the Assembly's desire to have a greater role in this regard. However, the arrangements set out in the Bill do not exclude it entirely. Byelaws will be made by the railway operator. The arrangements for approving the byelaws will not prevent the Assembly from working with Arriva Trains on the development of byelaws for the operator's stations and trains, which would then be approved by the Secretary of State.

I assure the hon. Gentleman that I will examine further the matter of byelaws and how they reflect dealings with Arriva Trains Wales, to see whether there is some way, perhaps outwith the Bill, that we can ensure that the Assembly plays a fuller role. I understand the importance of byelaws in many regards, although I am sure that he has read the Official Report of the assorted Committee proceedings, which reflect that there were those in Committee who would choose to push the byelaws a little too far in some regards. I will examine the byelaws point in more detail, to see whether through the memorandum, or some other way, there can be some accommodation.

I have dealt with the new clause and amendments in as detailed and serious a fashion as I could, and have tried to explain—I did receive a letter from the Welsh Assembly—why they are not necessary for a number of reasons. I will, however, pursue the point about byelaws outside the confines of the Bill.

I hope that the hon. Gentleman will withdraw the motion.

Elfyn Llwyd (Plaid Cymru, Meirionnydd Nant Conwy)

The Minister went into great detail, and responded in a very fair way. I hope that this matter will be revisited in the other place, but that is by the by, and not for today.

I hope to be able to move amendment No. 38 formally at the conclusion of proceedings, but I beg to ask leave to withdraw the motion.

Motion and clause, by leave, withdrawn.

New Clause 12 — Office of Rail Regulation Safety Report

Elfyn Llwyd (Plaid Cymru, Meirionnydd Nant Conwy)

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

The new clause is very straightforward. It seeks to give the Office of Rail Regulation a duty to spotlight safety issues, which I think is important. I am not being alarmist, but in 2003–04 there was a pronounced increase in the number of incidents in which fewer than five fatalities occurred in the United Kingdom, as compared with the preceding two years. Although there were no major incidents in 2003–04, there were several minor incidents on the network. My hon. Friend the Member for Caernarfon (Hywel Williams) and I know of one or two quite close to our constituencies, at Porthmadoc, and there have been some near misses elsewhere. There was a 6 per cent. reduction in the number of incidents of signals being passed at danger in 2003–04, but there were 378, which is quite a large number.

Without being alarmist, we firmly believe that as there will no longer be a separate body to consider this issue—the Health and Safety Commission, whose responsibilities are to be absorbed into those of the Office of Rail Regulation—the public would be reassured if the Bill took account of that change by reorganising the railways to strengthen safety provision. We would also like the ORR, when it reports annually, to have criteria on which to judge relative safety in the relevant year, in the context of performance targets and the like.

A later amendment, amendment No. 35, deals with safety, but we think that the extension of the ORR's responsibilities to rail safety should be in the Bill.

The Minister is deep in conversation. I do not want to embarrass him, but I should like him to respond.

Greg Knight (Conservative, East Yorkshire)

I shall be brief, because I want us to cover as much ground as possible today.

In the light of what we have just heard, I think it worth pointing out that rail travel in the UK is still one of the safest forms of travel. However, Conservative Members have some sympathy with new clause 12. Its aims are laudable. I have reservations about the potentially heavy-handed nature of these provisions, but if it is a question of balancing improved safety scrutiny against the imposition of a heavy-handed framework, we would all say that safety must come first. I hope that the Minister will be able to reassure the House that the new clause is not needed.

Tony McNulty (Labour, Harrow East)

As the hon. Member for Meirionnydd Nant Conwy (Mr. Llwyd) said, new clause 12 seeks to impose on the Office of Rail Regulation a statutory duty to publish an annual safety report. The ORR would be required to include in the report information on passenger and non-passenger injuries and fatalities, and conclusions as to their causes; recommendations resulting from consideration of these incidents; and findings and recommendations arising from reviews of safety at level crossings. The statutory duty would also require that reviews of safety at level crossings be conducted annually.

I agree with the right hon. Member for East Yorkshire (Mr. Knight)—the hon. Member for Meirionnydd Nant Conwy seemed to make the same point—that accidents of one sort or another are always likely to occur on our rail system. Mercifully, grave incidents are few and far between, and rail remains overwhelmingly one of the safest forms of transport. We will all agree that when accidents do occur and difficulties arise, the actions of our emergency services and all subsequent inquiries and reports are expedited, in so far as they can be, in an extremely professional and committed fashion.

The right hon. Member for East Yorkshire has anticipated me, in that I shall ask the House to resist the new clause, which is not necessary, as I hope to show. The Health and Safety Executive is currently responsible for publishing an annual report on the safety record of the railways—a function that is set out in the memorandum of understanding drawn up by the Secretary of State for Transport and the Health and Safety Commission. That MOU details the respective working arrangements and responsibilities in respect of railway safety, including the functions to be performed by the HSE. There is no statutory requirement in the Health and Safety at Work, etc. Act 1974 for the HSE to publish an annual report on railway safety. Such reports give details of incidents involving passengers and non-passengers, as well as those involving level crossings, and they are publicly available, free of charge, on the HSE's website. The HSE considers safety recommendations separately, in the context of inquiries and investigations commissioned for specific incidents.

In transferring safety functions from the HSE to the ORR, we will seek to ensure that all such functions continue to be carried out in the same manner. Although there was no statutory requirement on the HSE to publish a safety report, the ORR should do so and we anticipate that it will. Indeed, we expect a similar reporting function to be set out in an MOU, to be drawn up by the Secretary of State and the ORR. The drawing up of an MOU with the ORR will form part of the transition arrangements.

The Rail Safety and Standards Board is also required to publish an annual safety report. Furthermore, the rail accident investigation branch will have a duty to produce a report on all accidents and incidents that are the subject of an investigation. The intention is that the regulations providing for these duties will come into force later this year. We need to consider how best to fit these publications together, with a view to providing the public with information in the most effective way. Although I cannot say at this stage exactly how that will be done, I can assure the House that the information currently available to the public will continue to be available. In that context, I suggest that the new clause is unnecessary.

The present health and safety regime on the railways will continue following the transfer to ORR, as will the publication requirements placed on the RSSB. In addition, when the RAIB comes fully into existence, information about its activities will remain in the public domain. Therefore, the proposals in the new clause are already covered by the Bill, and I ask the hon. Member for Meirionnydd Nant Conwy to withdraw the new clause.

Elfyn Llwyd (Plaid Cymru, Meirionnydd Nant Conwy)

I thank the Minister of State for that detailed explanation. Although I continue to believe that these matters should be included in the Bill and that responsibility for safety should reside with the ORR, it is possible that this is a debate for another place.

I beg to ask leave to withdraw the motion.

Motion and clause, by leave, withdrawn.

New Clause 13 — Code of Practice for Disabled Rail Users in England and Wales

Christopher Chope (Conservative, Christchurch)

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

Sylvia Heal (Deputy Speaker, Halesowen and Rowley Regis)

With this it will be convenient to discuss amendment No. 60, in clause 47, page 50, line 38, at end insert

'and the Mobility and Access Committee Scotland (MACS)'.

Christopher Chope (Conservative, Christchurch)

Many disabled people still feel disenfranchised when they consider embarking on a rail journey, and the new clause would put that right. Rail journeys should be a pleasant experience for everyone, regardless of whether they are disabled, and I hope that the new clause will engender the Government's support.

Tony McNulty (Labour, Harrow East)

The hon. Gentleman has been very brief in his presentation of the new clause, but I am sure that the House shares his concerns about disabled passengers. I disagree, however, that the new clause goes further than existing provision. When one considers the lot of disabled passengers under the previous Conservative Government between 1979 and 1997, the new clause is, frankly, a joke. However, this is an important matter for discussion.

The new clause would require the Secretary of State to promulgate a code of practice for protecting disabled railway users in England and Wales. It would empower the Secretary of State to prepare and, from time to time, revise that code of practice. It would require him to publish it, and each revision of it. Finally, it would require him to consult the Department's disabled persons transport advisory committee before preparing or revising the code. It is designed to provide for a duty on the Secretary of State to maintain a code in England and Wales that corresponds to the power in clause 47 allowing Scottish Ministers to prepare a similar code. I strongly believe that the new clause is unnecessary, and suggest that it be withdrawn. If it is not withdrawn, I ask the House to resist it because a stronger provision is already included in the Bill.

The existing requirement on the SRA to maintain a code of practice is contained in section 71B of the Railways Act 1993. Paragraph 29 of schedule 1 to the Bill preserves that requirement, substituting the Secretary of State for the SRA. The Secretary of State's duty will extend to the whole of Great Britain, with the Scottish Executive's code applying only to services that they procure, including the ScotRail franchise. The schedule 1 provision is stronger than the terms of the new clause in that it additionally requires the Secretary of State to promote the adoption and implementation of the code, but the new clause would require him only to revise and publish the code from time to time. The requirements in the new clause would not achieve anything for disabled passengers. Schedule 1 also makes transitional provision to continue in force any existing SRA code and to enable the Secretary of State to draw on any consultation already undertaken by the SRA. That will provide continuity between the position as it stands under section 71B of the Railways Act 1993 and the position in the post-SRA period. That is important, but the new clause would mean the loss of that continuity.

Amendment No. 60 seeks to add an additional requirement on the Scottish Ministers as to which bodies they must consult before publishing a code of practice for disabled rail users in Scotland under clause 47. The clause currently requires consultation with the disabled persons transport advisory committee, which is the body that SRA must currently consult when preparing a code of practice under the Transport Act 2000, and the body that the Secretary of State will be required to consult when he acquires the SRA's duty. Therefore the third element of the new clause is redundant, because it provides for something that already happens and will continue to happen under the new system.

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

I am following the Minister's argument with some interest. He makes a powerful argument that the measures in the Bill are stronger than the new clause. On the question of consultation, can he say whether the SRA is—or the Secretary of State will be—under any obligation to consult the Disability Rights Commission, which has been established since the 1993 legislation?

Tony McNulty (Labour, Harrow East)

That is a fair point, but I will have to get back to the House on it. I am not completely au fait with the legislation that established the DRC, so I do not know whether it drew in all consultation requirements in extant legislation. I half think that the DRC automatically has a general role in any aspect of disability provision, including transport and the railways. I will certainly get back to the hon. Gentleman and the House on that point.

The amendment would add the Mobility and Access Committee Scotland as a second consultee, after the disabled persons transport advisory committee, for Scottish matters. I freely concede that the amendment raises a very good point. MACS has been established by the Scottish Parliament to fulfil a similar role in Scotland to that of DPTAC in Great Britain and the Scottish Executive have advised that MACS is very important, but we need to take a step back. I have some sympathy with the principle behind the amendment, but we still think that it is unnecessary. As the matter is convoluted, let me go through it briefly.

The Mobility and Access Committee for Scotland was established by the Scottish Parliament in 2002, and fulfils a similar role to DPTAC. DPTAC was established under legislation that pre-dated devolution, but equal opportunities law, including the Disability Discrimination Act 1995, is reserved to Westminster. So, on the face of current legislation, DPTAC continues to have a role in Scotland.

However, DPTAC and MACS work closely together. They have a concordat between them that will ensure that their work is complementary and that while DPTAC will deal with all issues that are reserved to Westminster, MACS will deal with issues that are devolved to the Scottish Parliament. I can imagine a much greater role for MACS in future with the additional devolution proposed by the Bill, but believe me, Madam Deputy Speaker, I have looked into how one might unpick the pre-devolution legislation that established DPTAC—pre-devolution legislation that established much of the framework of our equal opportunities legislative framework—and I have discovered that a great many amendments would be needed to get it all in order to such an extent that we could simply say that in Scotland, given where we have got to with greater devolution on rail, MACS should be consulted, and in the rest of the country DPTAC should be. Although it is convoluted, I think that that explanation renders the amendment unnecessary.

So, there would be a much greater role for MACS in future, given the additional devolution proposed by the Bill. However, a duty for Scottish Ministers to consult DPTAC but not MACS, however silly it sounds, should not adversely affect the existing role of MACS. Existing arrangements should ensure that DPTAC involves MACS or refers to it where an issue relates to devolved matters. I am also sure that when the Scottish Executive do consult on the code of practice, they will involve as wide an audience as necessary.

Although I have, as I have tried to explain, enormous sympathy with amendment No. 60, I think that, for many of the reasons that I have suggested in terms of the legislative complexities, it is unnecessary; equally, given the increasingly strong relationship between DPTAC and MACS, if the import of the amendment is to ensure that the Scottish voice of disabled transport users is as fully involved and consulted as possible once these rail matters have been devolved to the Scottish Executive, the House can have, I think, my assurance that we will work together with the Scottish Executive to ensure that what the amendment seeks to do will prevail. But please do not ask me to take the matter back and come back with what will be, I would guess, anything from 30 to 50 amendments just to get all the legislative elements lined up so that what we all want can prevail strictly and purely in law. Rather, I ask hon. Members, please accept the assurance that it will prevail in reality. We do not want to go unpicking pre and post-devolution legislation and the statutory framework. In that context, I hope that the new clause will be withdrawn and the amendment will not be pressed.

Christopher Chope (Conservative, Christchurch)

I note that the Minister has responded in great detail. We shall read what he has said and then consider whether we should come back with this amendment or something similar in the other place, but in the meantime, bearing in mind that there is only about 15 minutes left to discuss all the remaining amendments on the amendment paper, I beg to ask leave to withdraw the motion.

Motion and clause, by leave, withdrawn.

Clause 12 — Transfer Schemes at End of Franchising Agreements

Elfyn Llwyd (Plaid Cymru, Meirionnydd Nant Conwy)

I beg to move amendment No. 35, in page 11, line 6, at end insert—

'(2A) The appropriate national authority may make a scheme for the transfer, before the end of the franchise period, if the authority considers, after consultation with the Office of Rail Regulation, that the safety record of the franchisee is such as to warrant a transfer on the grounds of passenger safety.'.

Sylvia Heal (Deputy Speaker, Halesowen and Rowley Regis)

With this it will be convenient to discuss the following amendments: No. 18, in page 11, line 13, leave out

'and

(e) a franchise company.'.

No. 17, in page 11, line 14, at end insert—

'(3A) The appropriate national authority shall not make a scheme for the transfer of relevant franchise assets to a franchise company, at the end of the franchise period, if an independent assessment, which must be authorised by the national authority, demonstrates that the assets could be operated more economically and efficiently by a person identified in subsection (3)(a), (b), (c) or (d).'.

No. 4, in page 11, line 43, at end insert—

'(9) The Secretary of State may not exercise his powers under subsections (2) and (3) to make a scheme to transfer the relevant franchise assets of any franchise currently operated by the Strategic Rail Authority (SRA) to a franchise company. Those assets shall continue to be operated by a company wholly owned by the Secretary of State or the Scottish Ministers.'.

Elfyn Llwyd (Plaid Cymru, Meirionnydd Nant Conwy)

The effect of amendment No. 35 is obvious. It would make safety a paramount consideration overriding other provisions in franchise agreements. It would open up the possibility of renationalising rail services on safety grounds, although the term "transfer" could include a transfer to a private company.

John McDonnell (Labour, Hayes and Harlington)

There are only 15 minutes left in the debate, so I shall be as brief as possible. I shall speak to amendments Nos. 18, 17 and 4, which I have tabled. With your permission, Madam Deputy Speaker, I hope to press amendment No. 17 to a Division at the appropriate time.

The Bill is part of a sequence of events since 1997 during which we have been on a path of overcoming the problems faced by the railway industry as a result of privatisation under the previous Conservative Government. Although I do not think that the amendments go far enough, they offer a range of ways in which the Bill could be improved to bring back a degree of public ownership and public sector involvement.

I argue the case for public sector ownership, control and accountability because the promises that we were given at the time of privatisation have demonstrably not been fulfilled. We were told that privatisation would bring about more investment in the railways and that the service would be improved. We were told that there would be a transfer of risk from the public sector to the private sector and that we would have a more efficient railway system throughout the country. I congratulate the Government on the massive growth in investment, but that has come not from the private sector, but the Government, taxpayers and passengers.

Last year's public subsidy to the private sector from the taxpayers of this country was £2 billion. Since privatisation, the Government have put £10 billion into the railway industry, but £1 billion of that—figures now suggest that it might be nearer £2 billion—has been creamed off for profit. Today's Evening Standard publishes the various companies' profits for last year. Their profits have risen by an average of 20 per cent., with FirstGroup making £60 million, National Express £54 million and Stagecoach £43 million. The private sector continues to exploit the railway industry for its own benefit.

We were told on Second Reading that we required private sector involvement because it would bring £70 million a week of additional investment to the railway industry itself, but recent independent examination by independent experts has demonstrated that all that £70 million a week is public sector money that has been laundered back into the system. It is made up of subsidies provided to the private sector which it then disguises as its own investment.

Profiteering has gone on apace, which is why we need a publicly accountable railway system. Profits have been achieved by what is called "sweating the assets", which means cutting services, exploiting the work force, and sometimes putting passengers at risk by undermining safety regulations and practices. We have heard of two further examples of that this week. On Monday, the Daily Mirror exposed yet again the fact that maintenance contracts on track renewal have led to the system being left unsafe overnight and over the weekend because of inadequate work done by inexperienced people. Only two days ago, 100,000 passengers were unable to travel on the London Underground because the private company managing the service could not complete its work overnight, as it did not bring the materials required for the job. Costs have escalated under the private sector, and costs for maintenance and renewal have almost doubled in the private sector compared with those under British Rail.

Jeremy Corbyn (Labour, Islington North)

Is my hon. Friend aware that the company Tube Lines, which is owned by Jarvis, has got into enormous financial difficulty and, indeed, has sold its contracts with the public sector to refurbish parts of the London Underground? There is now trading in public contracts, but priority should be given to finishing those contracts for the public interest and the public good, rather than advancing share prices in the City.

John McDonnell (Labour, Hayes and Harlington)

Companies trading in profits is understandable when one looks at examples such as National Express, which expects a 70 per cent. increase on last year's profits. How can that provide value for money for the public sector and for the travelling public?

When the public sector demonstrates that it can run a service effectively and efficiently and give good value, as when Connex South Eastern went bust and South Eastern Trains took over the franchise, what happens? The Government force the operation back into the private sector. The private sector argues that its involvement enables transfer of risk, but we know that when that risk becomes too great, the public sector has to take it over again. That is what happened with the channel tunnel, Connex South Eastern and the maintenance contracts across the whole industry. Transfer of risk was a myth; it has been clearly demonstrated that it never worked from the start.

I am unable to comprehend why the Government cannot now allow some form of public sector operational involvement in the railways industry. The general public are convinced: poll after poll shows that the public want the railways to be brought back into the public sector. As for the Labour party, I remind comrades and colleagues that at its last conference the party voted overwhelmingly for a policy to bring rail back into public ownership. When South Eastern Trains was discussed at the London Labour party conference, which took place only weeks ago, it was agreed unanimously that South Eastern Trains should remain in the public sector. It is absolutely bizarre that the Government will not even allow the public sector a level playing field with the private sector. That is what amendment No. 17 would achieve.

Amendment No. 18 is straightforward: it invites the Secretary of State to bring the railway industry back into public ownership as franchises run out. Amendment No. 17 simply proposes that when a franchise comes up for renewal, there should be a public sector comparator to enable an independent assessment of whether the public or the private sector can run it best; then, the contract should be awarded according to the results of that assessment.

Amendment No. 4 states simply, "If it ain't broke, don't fix it." If South Eastern Trains is running operations effectively in the public sector, why not leave it there? Ironically, it may well remain in the public sector—the Norwegian public sector, unfortunately, since Norway's state railway is bidding for the operation. The Government have a bizarre ideological commitment—a dogmatic commitment—to the private sector. It reminds us of the Victorian commitment to the hidden hand of the market, or, perhaps more appropriately, the American neo-conservatives' mantra for every occasion: "Private sector good, public sector bad." It appears that the only role that the Government envisage for the public sector is that of clearing up the mess made time and again by the private sector.

On Second Reading and elsewhere, the Secretary of State argued that the railways cannot be brought back into the public sector because it would be too expensive. We were told at one point that it would cost £3 billion, yet within six months we were told that the cost would be £22 billion. My amendments would enable the railway industry to be brought back within the public sector without cost, as franchises run out. It is argued that amendment No. 18 inserts a public sector preference, but amendment No. 17 answers that by invoking an independent and objective assessment process. In fact, it is almost a modernising amendment—practically third way-ish.

Amendment No. 4 is also straightforward. All the statistics for every quarter of last year show that South Eastern Trains in the public sector has outperformed all the private sector elements of the industry. They demonstrate how much more efficiently and effectively the operation has been run since it was taken over from Connex.

Robin Cook (Labour, Livingston)

I do not want my hon. Friend to understate his case. I am sure that he wants attention to be drawn to the fact that South Eastern Trains has not only improved the service to the public, but cut the subsidy needed by £1 million a month. The Government are therefore gaining every bit as much as the travelling public; surely they have an interest in ensuring that that continues.

John McDonnell (Labour, Hayes and Harlington)

My right hon. Friend makes a valid point about benefits for the Government, but there are also benefits for South Eastern Trains from bringing maintenance contracts in-house. All that we are asking for is a rational process of decision making. We do not come with any ideological baggage from the past about the danger of relying on the hidden hand of the market or about the perfection of the public sector. We want a rational process of assessment.

Time is short, so I shall conclude with an extract from a moving speech that was made at the Labour party conference. It is about Africa and the Government's role in the world, and the example that the Government can set, not just in Europe but globally:

"But if we can show a publicly funded health service free at the point of need delivers to all the people, if we can show a modern state schooling free of charge is the best hope for all children, if we can show the ethic of public service is so strong that public services can provide efficiently for all people without having to privatise or charge . . . then what a difference our country can make to our world."

I agree with that emotional and powerful speech by the Chancellor of the Exchequer. It sums up the arguments of the amendments precisely and succinctly. All we want is a fair approach based on what works, what is in the best interests of our overall community, and what delivers services to passengers without exploiting the state for the profiteers in the private sector, as happens at present. On that basis, I should like to press the amendment to a vote.

Tony McNulty (Labour, Harrow East)

Amendment no. 35, which was moved by the hon. Member for Meirionnydd Nant Conwy (Mr. Llwyd), aims to provide a discretionary power to transfer designated assets from a franchisee if that is warranted on passenger safety grounds. It would not achieve that as worded, and it is also unnecessary. I accept, however, the hon. Gentleman's point about the paramountcy of safety on the railways, which was a feature of the various contributions from colleagues.

If a franchise operator operates in an unsafe manner, there are various means by which it can be held to account, including the terms of the franchise agreement, the terms of its operating licence and the enforcement of the Railways (Safety Case) Regulations 2000. The hon. Gentleman will know that those regulations require all railway operators to have a comprehensive safety case approved by the Health and Safety Executive before starting operations. A railway safety case ensures that a railway operation has effective arrangements in place to ensure the safety of workers, the travelling public and others who may be affected by the operation. If the operator acts in breach of its safety case, it may be prosecuted by the HSE.

The Office of Rail Regulation will only grant a licence to operate if the train operator holds a valid safety case, unless the HSE has granted a safety case exemption for any reason. The regulator may revoke a licence if the licence holder commits a serious breach of the Railways (Safety Case) Regulations. Unless exempt, it is unlawful for an operator to operate railway assets without a licence. It is an event of default under the franchise agreement if the operator's safety case is withdrawn or terminated, or if the operator is in material non-compliance with an HSE prohibition or enforcement order. All those powers are entirely adequate to protect passenger safety.

It is hard to imagine a circumstance in which passenger safety might require the ownership of designated assets such as ticket barriers, information systems or contracts to be transferred to another body. If the assets themselves are a danger to the public, it will not remedy the situation to transfer the ownership of those assets to another person. For all those reasons, amendment No. 35 is not necessary.

Amendments Nos. 4, 17 and 18, as my hon. Friend said, are intended to prevent private sector train companies operating franchises, but they would not work, nor would they outlaw franchises or transfer between operators. Taking back into the public sector each franchise as it ends costs nothing, for reasons that I shall amplify another time. It is also not the case, as my right hon. Friend the Member for Livingston (Mr. Cook) suggested, that the operating subsidy is far less—

It being Five o'clock, Mr. Deputy Speaker put the Question already proposed from the Chair, pursuant to Order [6 December 2004].

Amendment negatived.

Mr. Deputy Speaker then proceeded to put the Questions necessary to dispose of the business to be concluded at that hour.

Transfer Schemes at End of Franchising Agreements

Clause 22 — Proposal by Service Operator to Discontinue Non-Franchised Services

Clause 17 — Membership of Transport for London

Clause 44 — Interpretation of Part 4

Clause 46 — Power of Scottish Ministers to make Penalty Fare Regulations

Clause 53 — Further Amendments of the 1993 Act

Schedule 1 — Transfer Etc. of Functions of the Strategic Rail Authority

Schedule 3 — Transfer of Safety Functions