Asked by
To ask Her Majesty’s Government what estimate they have made of
the impact on train services of a 10 per cent reduction in
payments from the Department for Transport to train operating
companies.
The Parliamentary Under-Secretary of State, Department for
Transport () (Con)
My Lords, the department has no plans to reduce payments to train
operating companies by 10% and has not assessed the impact such a
reduction would have on train services. As noble Lords would
expect, we have asked operators to provide credible, efficient
and sustainable business plans which will deliver reliable and
resilient train services that adapt to passengers’ evolving needs
and drive value for taxpayers.
(Lab)
My Lords, will the Minister accept that the twin attacks of a
3.8% increase in rail fares, the highest in almost a decade,
together with any reduction in subsidies—I would still like to
know exactly how much the Government are prepared to put forward
towards our rail industry in the next financial year—will lead to
reduced numbers of passengers travelling by train and more
congestion and pollution on our roads? Surely that is not the way
forward as regards the Government’s carbon reduction targets.
(Con)
The Government are very focused on making sure that the services
we provide for passengers meet their needs. Ridership at the
current time is around just under two-thirds of what it was
pre-pandemic. There may have been substantial and enduring
change, so we are working with the train operating companies,
asking them to look very carefully at timetables, remove
duplications where possible and look for savings and
efficiencies. At the end of the day, we need to provide services
that meet passengers’ needs, and they need to be punctual and
reliable.
(Non-Afl)
My Lords, if the Government are not cutting subsidies for the
train operating companies, can the Minister tell me why services
on the west coast main line have deteriorated so badly over the
past year or so? Trains are often cancelled, frequently
overcrowded and often late. I never thought I would be saying,
“Bring back Branson”, but services under Avanti appear to be
markedly worse than they were previously. What are the Government
going to do to improve the situation?
(Con)
In the broader scope of things, Great British Railways will be
developing the whole industry strategic plan; the call for
evidence for that has now closed. We are also asking each train
operating company to produce annual business plans, which will
streamline the passenger offer, make sure demand is actually met
and in balance with the supply, remove duplication, as I said,
and ensure that operations are as efficient as possible.
(Lab)
It is clear that government demand in savings running into many
millions of pounds will result in cuts in Network Rail’s
maintenance budget. We have already seen what a casual approach
to Network Rail and the use of outside contractors can lead to in
the light of previous accidents at Ladbroke Grove and Potters
Bar, and a recent report into the train crash at Stonehaven in
2020 found that a drainage system wrongly built by Carillion,
which subsequently went bust, and left unchecked by Network Rail
led to the crash. The Rail Accident Investigation Bureau said
that the tragedy was
“a reminder how potentially dangerous Britain’s volatile weather
can be.”
How did the Government come to the conclusion that now is an
appropriate time to make major cuts in maintenance roles on our
railways, and will they now reconsider their decision in the
interests of safety, which should be the paramount consideration,
rather than financial considerations?
(Con)
Safety is, of course, the priority for everybody who works in the
railways, and the tragedy at Stonehaven is deeply regrettable.
The Government have no intention of diminishing the work we do on
safety and maintenance—it is extremely important—but we must look
for efficiencies within the system, because we have seen this
significant reduction in demand, we must make sure that we
protect the taxpayers’ investment, and that is what we are
doing.
(LD)
My Lords, as other noble Lords have mentioned, the 3.8% increase
in rail fares simply adds to the financial pressure on families
at this difficult time. Does the Minister accept that, now that
the Government have ended the franchise system, with revenue from
fares going straight to the Treasury, it is entirely in the
Government’s hands what policy they choose to use in future to
attract passengers back on to the railways? Does she accept that,
for environmental reasons, it is essential that lower fares are
used to attract passengers?
(Con)
Of course we would like to keep fares as low as possible, but we
also need to support crucial investment and pave the way for
financial sustainability for the system as a whole. When we took
the decision on regulated fares, we looked at inflation and chose
to peg it to July’s RPI, which resulted in an increase of 3.8%.
Of course, it could have been much higher had we used an RPI from
a later month. We also delayed the introduction of the increase
by two months, which was particularly beneficial for those buying
annual season tickets. There are other ways we can encourage
people back to the trains, and we are doing as much as we can,
working with the train operators. For example, the Book with
Confidence intervention was extended to 31 March. That allows
customers to rebook their tickets if they are unable to travel,
without administration fees.
(Non-Afl)
Can the Minister draw our attention to any statistical evidence
for the notion, which is counterintuitive, that a vicious circle
is not developing here between cutting services and raising
fares?
(Con)
I do not accept that at all. It is right that we ensure that our
services meet the needs of passengers and are punctual and
reliable, and that the contribution from the national taxpayer is
appropriate. There will be areas of duplication and areas where
efficiencies can be found. The Williams-Shapps Plan for Rail
states that in five years’ time, savings of about £1.5 billion
should be available after simplification and efficiencies. Those
are the things we are trying to drive out of the system. We want
passenger services to be as good as we can possibly make them
because we really would like people to travel on our
railways.
(Con)
My Lords, does my noble friend have a view on the level of
unionisation on the railways and what are the consequences of it
for the cost of staff and pay?
(Con)
My noble friend makes a very important point. All noble Lords
will have seen that there is a level of unrest among the unions
that represent those working on the railways. Sometimes I feel
that their behaviour might be potentially counterproductive in
the long term. For example, we have strikes at the moment on the
London Underground where, because of the pay deal that was
reached a couple of years ago, the staff will be getting a pay
increase of 8%.
(LD)
Can the Minister explain how raising fares and cutting subsidies
to the train operating companies contributes to one of the key
aims of levelling up, which is to improve public transport? I ask
her to think about Yorkshire especially in this context.
(Con)
My Lords, I am always thinking about Yorkshire. The noble
Baroness raises an important point. There is an amount of money
that will be going into the system, which will be used to service
what is at the moment a lower number of passengers. That is where
we must get the balance right. We must work with industry to
support it on the initiatives and boost demand, also ensuring
that the services are there when they are needed. The increase of
3.8%, compared with what inflation is currently, is not
significant, given that we could have had a more significant
increase had we used an RPI from a later month.
(Lab)
My Lords, I press the Minister a little more on the question
asked by my noble friend about Network Rail’s costs. I
understand from many in the industry that Network Rail has been
told to cut its costs by 40% in the coming year. That seems an
enormous amount, compared with what it is doing at the moment and
the need for safety. Can she confirm whether that is true or
completely wrong?
(Con)
I do not have that figure with me, but I will certainly write to
the noble Lord with further details around Network Rail’s
expectations for the coming years.
(CB)
Does the reduction in passengers, which the Minister says may
well be structural, not further endanger the investment case for
HS2?
(Con)
I do not think that is the case. Obviously there are various
scenarios which we consider when we look at HS2. It is a very
long-term strategic system. It connects many of our major cities
across the country and, provided that we get local transport
integrated with that investment with HS2, it will be
successful.
(Lab)
There was an article in the paper this morning about closing many
ticket offices. Is this likely to happen? If so, is that a better
service for the passengers on our rail network?
(Con)
Ticketing and fare reform is a key part of what we hope to do
with Great British Railways. The leadership there will help with
the mass of complicated fares which currently exist. We will be
supplementing that with £360 million of investment in fares,
ticketing and retailing. We will deliver contactless
pay-as-you-go in 700 stations in urban areas across the country,
including 400 stations in the north, and we will provide digital
ticketing across the network and upgrade ticket vending machines.
Obviously we will have to look at the number of ticket offices
available, but we will also ensure that people get the level of
customer support that they need.
