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Baroness Thomas of Walliswood: My Lords, I am sorry to interrupt the noble Lord in full flow, but I assure him and the House that, as far as I am aware--and I am leading on this Bill--there have been no discussions of any description between the noble Lord sitting on the Conservative Benches and myself.

Lord Faulkner of Worcester: My Lords, I am naturally delighted to be corrected by the noble Baroness. I was going on what press reports were indicating; if they are inaccurate and the two parties do not intend to come together in the way that I have described, I shall be very happy to be proved wrong on this.

Safety is absolutely paramount but I take the view that the combination of the CAA safety locks, the power under Clause 35 of the Bill given to the Secretary of State to issue a direction to NATS licence holders in the national interest and the "fit and proper person" selection criteria for the strategic partner, provide the necessary safeguards.

I turn now to Part IV of the Bill and specifically its proposals to remove the "shadow" from the SSRA and to establish the Strategic Rail Authority as the body to replace the British Railways Board; to take over the functions of the franchising director; and to make a number of changes to the regulatory arrangements for the railways.

It is important that we understand how much the railway has changed in the past five years. Some of these changes have been for the better and a number, I readily admit, have followed from privatisation. Most of the improvements stem directly from the new approach which this Government have adopted towards the railways. The sea change is that the industry is now planning for growth and not for contraction.

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Not very long ago, I recall a very senior official from the Department of Transport being seconded to the British Railways Board and telling his colleagues in the first week that he was there "to preside over the orderly run-down of the railway". Faced with attitudes like that, it was little surprise that the industry was starved of investment and received less subsidy support than any comparable railway system in Europe. These are facets of railways at that time which the noble Lords, Lord Freeman and Lord Marsh, will recall from their own experience only too well.

The railway is now growing fast. Train miles have grown by 16.1 per cent in the past five years and passenger miles by 30 per cent. Further growth of between 30 and 60 per cent is forecast for the next 10 years. Freight tonne miles are also up one-third against a background of decline over the previous 50 years. Much new investment is coming on-stream: 2,350 new coaches have been ordered since privatisation and more are in the pipeline; 300 new locos are on order for the freight companies; and 2,500 new wagons are coming off the production line at York and going into service. All these developments are heartening to those of us who are committed to the expansion of rail travel and long for it to be given the chance to contribute more in the national transport scene.

In our transport debates, I hope that we continue to remind ourselves that a twin track railway has the same capacity as a six lane motorway and accounts for one-quarter of the land take. The right reverend Prelate the Bishop of Hereford, in what I consider to be a very sensible speech, spoke eloquently about the environmental benefits of rail freight as well.

The growth in demand for rail travel brings with it new challenges and problems for the industry. Compare just two of the figures I have mentioned: train miles up 15 per cent and passenger miles up 30 per cent over the past five years. Even though there are 1,500 more trains running now than there were in 1995, services are more congested and more people are inconvenienced if the trains run late or are cancelled. In the old BR days--I hesitate to say "the bad old days"--when the emphasis was on contraction and there was little investment in capacity, the solution dictated by the Treasury was simply to push up the fares and price people off the trains. Happily, that is no longer seen as an acceptable option and the task for the new railway is to plan for growth and at the same time invest in new infrastructure to provide new capacity and replace equipment which is outworn and life expired.

That provides a huge challenge for the SRA, the train operators, the regulator and Railtrack. In creating the SRA, the Bill provides the necessary focus and sense of direction. It also allows the present inadequate short-term franchises to be replaced with longer ones. They must bring with them new investment and increased and more reliable train services. Six franchises are already in the replacement process. The study for a Wales/borders franchise is proceeding well, with a report due next month.

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Schemes have already been authorised for a new cross-London service, a park-and-ride scheme in Edinburgh, a new fast service from Sheffield to Hull and schemes to provide more capacity in Bristol, Leeds and Newcastle.

The SRA has been in business in shadow form only since July last year, but the new organisation is already providing the necessary new leadership for the rail industry and encouraging the development of a better railway. Its main task is to offer a real alternative to road for more passenger journeys and freight movements.

Like the SRA, most of the train operators are aware of what is expected of them under the new regime. I agree very much with Mr Giles Fearnley, the chairman of the Association of Train Operating Companies, when he says in introducing the new summer timetable:


    "the rail network urgently needs large amounts of investment from the industry and Government to provide passengers with the modern and efficient rail system that they want and deserve".

I wish that all train operators could strive to be as good as the best because that is not the case at present.

It is important that the Bill clarifies and strengthens the role of the rail regulator. He has an essential part to play in these new arrangements. The Bill gives him new duties to facilitate the execution of the SRA's strategies; to contribute to the development of an integrated system of transport of passengers and goods; and to contribute to the achievement of sustainable development. To do his job effectively, he must have proper powers of enforcement, particularly as that affects Railtrack's network licence and how the company delivers on reliability, in minimising delays, and on investment. He must also be independent of Government and not be deflected by political pressure.

I was disappointed to read that, during the Report stage of this Bill in another place, there were attacks on Mr Tom Winsor by Conservative members for the action which he very properly took after the Ladbroke Grove accident. Happily, I am pleased to say they were not repeated by the noble Lord, Lord Brabazon, this afternoon. Contrary to what Mr Bernard Jenkin alleged in the other place, Mr Winsor did not threaten to revoke Railtrack's network licence--he does not have the power to do that. Section 4(5) of the 1993 Railways Act requires the regulator to consult the Health and Safety Executive when there is prima facie evidence of a breach of railway group standards and of the Railways (Safety Case) Regulations. I hope that Ministers will continue to give their full support to Mr Winsor who is doing the best he can to deliver stable, predictable, transparent, fair and proportionate regulation. That is in the interests of the whole industry including its customers.

That brings me finally to Railtrack and to the crucial role that it has to play in delivering the new railway. It has clearly found it hard to come to terms with the new approach which the Government are bringing to transport, and this is not surprising. The previous regulator and the Conservative government gave

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Railtrack an easy ride. It took some time for the company's shortcomings to be identified and it has taken longer than it should to put them right.

I am still concerned about some aspects of its operations, particularly its property division. In that regard, the objective of making money from selling station sites to non-rail related interests such as supermarkets seems to take precedence over the need to plan for the future use of assets by the passenger or freight railway or by other prospective developers who aim to add new dimensions to railway travel. I suspect that we may hear more about that during later stages of the Bill as I hear whispers of amendments being drafted elsewhere.

Overall, the prospects for rail have never been better at any time during the past 25 years. I take the view that this Bill is essential to ensure that the industry can make the most of those new opportunities and I welcome it with enthusiasm.

6 p.m.

Lord Swinfen: My Lords, I do not intend to detain your Lordships for long this evening. In general, I welcome the Bill. In particular, I welcome the placing of local transport plans on a statutory footing. However, I hope that, in preparing local plans, note will be taken of national transport systems so that the two will be properly integrated. It would be useless if local bus services, according to the local plans, are due to arrive at railway stations catering for long-distance trains a few minutes after those trains are due to leave.

The Bill gives us the opportunity to ensure that local public transport can be enhanced for the benefit of elderly and disabled people, as already mentioned by the noble Lord, Lord Morris of Manchester.

I welcome the fact that the needs of pedestrians are to be taken into consideration when preparing local transport plans. In time, that will produce a safer environment for elderly and disabled people, as well as children. Pedestrian routes must be wheelchair-friendly.

Although I started by welcoming the Bill, it needs some improvement and I intend to table amendments for your Lordships' consideration at later stages. In recent years, on other Bills, the House has accepted amendments designed specifically to cater for the transport needs of people with disabilities.

Before the Minister spoke introducing the Bill, I was going to say that it was disappointing that the Government, their advisers and the Bill's draftsmen did not bear that in mind in preparation of this legislation. It would have saved the time and hard work of your Lordships and, indeed, of Members of another place. However, the Minister has indicated that some account has been taken of that but, in my view, more will need to be done.

Local transport plans should be drawn up in consultation with disabled people and with organisations of and for people with disabilities. Those plans should be available in alternative formats, if required, at no additional charge.

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I welcome the national concessionary fare scheme and the Minister's announcement this afternoon that it will be extended to help disabled people. Will that include disabled people in work? I am concerned that the scheme is limited by the expression "relevant time"; in other words, as I understand it, between 9 a.m. in the morning and 11 p.m. in the evening. In my view, that scheme should apply to all journeys in the local area as that would promote social inclusion and independence and would also help disabled people to work unsocial hours if they wish to do so.

Finally, I make a brief mention of two other points. First, there should be concessions for people with disabilities on the road-charging schemes and in workplace levies. They are the people who most need to use private transport.

Secondly, I welcome the fact that where railway services are temporarily interrupted or discontinued, the strategic authority must ensure that the alternative carriage for passengers is fully accessible to people with disabilities. I look forward to seeing the amendments which the Minister said he would bring forward in Committee to give effect to that. I had already planned to table amendments to deal with that point. I shall bring forward amendments to deal with other matters connected with disability at later stages of the Bill.

6.4 p.m.

Baroness Goudie: My Lords, in the integrated transport White Paper, this Government put the principles of sustainability and integration at the heart of their transport policies. The Transport Bill before this House aims to put those principles into practice at local and national level by building an integrated transport system which meets our economic and social needs but does not threaten the health of our environment. That is why one of the Government's key aims is the reduction of road traffic and pollution from road vehicles.

As this Bill has progressed through Parliament, we have heard much about the Government's proposals on road congestion charges and workplace parking levies as tools for tackling road congestion. We have heard also at length about the proposed private-public partnership for National Air Traffic Services Ltd.

One area which has hitherto received little attention is the movement of goods by rail and sea. As an adviser to Clydeport plc, I declare an interest in that area and I also declare some experience in those matters which I hope to add to this debate.

Clause 182 sets out the purposes of the Strategic Rail Authority, which include the promotion of the railway network for the carriage of goods as well as passengers and to contribute to the development of an integrated system of transport for goods as well as passengers.

The encouragement of the transfer of freight from road to rail is therefore central to the purposes of the Strategic Rail Authority. Perhaps I may say to the

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Minister that the omission of short sea freight from the Bill is a missed opportunity which I hope he will address in Committee.

The movement of goods by rail and sea within the UK has generally been held to be uneconomic, insufficiently flexible and useful only for the very longest journeys and for high volume, low value goods. That is no longer the case. Rail freight and freight by short sea shipping can now offer industry an increasingly competitive and flexible alternative to moving goods by lorries which are destined to sit in queues on the M25. Rail freight allows industry to move goods at speed at night to road-rail hubs from where lorries can distribute the goods to their final destination.

Recognising the strategic demand for change, organisations currently involved in rail freight distributions are committing multi-million pound investments into new locomotives and rolling stock to satisfy the increased market demand.

Advances in technology are also making ships faster. Their increase in speed and the impact of congestion on road haulage has made short sea shipping more competitive and reliable. It is no longer the mode simply for coal and timber, although those goods are still important to rail and sea freight.

The fast-moving goods consumer industries are now taking advantage of short sea shipping. Distillers of whisky are dependent on the deep-sea terminals for exportation of their product and take advantage of those new routes; for example, United Distillers uses feeder services to access deep sea ports. Manufacturers of paper use short sea distribution of timber from Argyllshire to Ayrshire and Cumbria. And it is better for the environment as it relieves road congestion and reduces the pollution that comes from road vehicles.

I am not anti-lorry nor anti-road. I have a car and I buy goods from shops which rely on lorries to bring them their stock. But I am pro-integration. I believe that there is a place for road haulage, for rail freight and for short sea shipping. But I do not believe that the potential of rail and sea freight is being fully realised or fully integrated into our transport system. I would like the Government to give much more encouragement to both users and operators of those two important modes of transport and to ensure that there is genuine integration into the transport system.

6.8 p.m.

Lord Dixon-Smith: My Lords, the device of using local government as the mechanism to introduce the new taxes in Part III, following the precedent of the Greater London Authority Bill last year, gives this House a rare opportunity to discuss finance and supply matters.

I welcome what the Minister said in his opening remarks about those new taxes and the way in which he hopes they will work. But he did not go far enough. Taxes are no less taxes for being collected, kept, used and accounted for locally.

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In order to sensibly discuss Part III of the Bill, it is first necessary to discuss Part II. The reason for that concerns the content of the local transport plans and, more importantly, the meaning of the words in the Explanatory Notes concerning Part II of the Bill. Paragraph 84 concerns the duty of local authorities to create local transport plans. It states that local transport plans "must" provide a framework for the promotion of improvement to buses under Part II and, most importantly, the introduction of charges under Part III. That wording is not consistent with that of the Minister's introduction, and the words on the face of the Bill are different. The Bill states:


    "a . . . local charging scheme may only be made if it appears desirable"

for the purpose of achieving the policies in the local transport plan. Perhaps in his reply the Minister could resolve that inconsistency in presentation.

In addition, in his opening remarks the Minister appeared to state that such charges will not be introduced until after bus and other transport systems have been sufficiently improved. That may be welcome, but if the charges are not to come into effect until after the necessary improvements have been made it could be argued that they are no longer necessary and that the huge revenues that the road users already pay in that situation will have been properly and well used to bring about any necessary improvements. That may be a perverse interpretation but it seems very real.

It is not surprising that on this side of the House we have had representations from the CBI, the Engineering Employers' Federation, the Food and Drink Federation and many others regarding these charges. This country is a trading nation. Its competitive position in international terms is essential to everyone's wellbeing. The new charges have the potential to raise transport and other costs at a time when manufacturing and other industries, particularly in the field of export, are already under extreme pressure.

Part of the purpose of the Bill is supposed to be to encourage freight transport to transfer away from roads. That is welcome. However, we need to recognise that the railways, which are the alternative, currently take only around 6 per cent of freight moved. Doubling that capacity will take care of only a very short time of growth in the economy. Imagine an economic growth of 3 per cent per annum--would not the Chancellor of the Exchequer be pleased with that? In two years' time the increased capacity of the railways to move freight would be absorbed. We have always needed, and always will need, a well-diversified transport system.

In addition, because of their impact on business costs, the new taxes--that is what they are; not charges and levies--could have a damaging effect. This is not simply a question of road freight costs--all retailing activity depends upon road freight--but labour costs also could be put under great pressure.

If ever there was a view that the roads are jammed because people drive around for pleasure, current costs of driving should be enough to exorcise it from

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anyone's thinking. Car drivers are on the roads from necessity. However, it must be said that convenience and time are both factors in such necessity.

I well remember how things worked when I was young and the country was emerging from the war. All movement was dominated by the rail and bus systems. Everything was much slower. It took far longer to do anything or to get anywhere. I do not think we could afford to go back to that. In the Bill, however, the Government appear to be introducing specific additional taxes on movement by road.

We know that the road user charges are to be paid by the registered owner of a vehicle, for that is what the Bill states. I suppose that the driver will be deemed to have been authorised by the registered owner. Increased driver costs, therefore, will almost inevitably impact upon wage cost pressures. It will not be more than a few months before wage demands are inflated as workers affected by such costs take steps to defend their relative prosperity.

In the case of the workplace parking levy, matters are not so clear. The levy falls on the provider of the space in the first instance, but the Bill is not clear about whether that should be passed on to the user of the space. If it is not, it is a straight additional tax on business and commerce. If it is, I have already said what will happen to wage cost pressures. Whichever is the correct answer--perhaps the Minister will provide clarification in his reply--the impact will be the same: business costs will increase and competitiveness will be put at risk.

Many figures have been bandied about to interpret what that might mean. For the sake of simplicity, I take two figures which have been discussed in the context of London: £5 per day for the road user charge, and £5 per day for a workplace parking levy. Those two figures have the capacity to increase the tax burden on an affected road-using employee of any business by £2,500 per year. When one thinks of the annual Budget debate in another place where the minutest tax increase can be extremely controversial, I am bound to say that I find it fascinating that these new taxes have caused so little fuss.

There are many other points of detail which we shall want to discuss with greater care than is appropriate at this stage of the Bill. However, perhaps some are worth noting. The Government suggested that they should exempt hospitals from the workplace parking levies because hospital staff work at night. In this modern, high-pressure age, so do many other businesses. Should they be exempt? What about businesses which operate park-and-ride systems or other co-operative transport systems, which are in the community's interest? Should they be exempt? What of the problems of businesses which operate continuous processes and are therefore required to have double the number of parking spaces so that two shifts can park at the same time? If a business is operating a commercial process, a shift coming on cannot wait until the shift which is already working has left its place of work and, more importantly, left its place in the car park. How do we cater for that problem?

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Those are all points which will unquestionably have to be debated at future stages of the Bill. However, there are two other matters which must be mentioned tonight. First, the Bill as drafted contains what I can only call the sop of hypothecation; that is, 10 years for transport improvement purposes for the new taxes, after they are introduced. That is supposed to make the taxes acceptable. I wonder. Almost exactly one year ago in this House we spent many hours discussing the Greater London Authority Bill. I remain firmly of the view that 10 years is too short a timescale for this hypothecation--I wholly support the remarks of the right reverend Prelate the Bishop of Hereford in that regard--particularly now that the taxes are to be spread across the whole country. So that debate must be reopened.

But there is a second matter, which I choose to describe as the "big" word that must be the companion word to "hypothecation"; that is, "additionality". That is all too familiar a word to local government. They have bitter experience of seeing funds, originally intended to be additional, absorbed and disappear into the Treasury maw.

The question is whether the unacceptable can be rendered more palatable. What is certain is that yet another tax imposed on road users will not be acceptable in any way if the funds it produces are not seen to be additional to those provided for maintenance and improvement of the transport system. Will the Minister, in his reply, strengthen the assurance given by his noble friend in his opening remarks that, if this matter is ever mentioned in the discussions on finance that must take place annually between central and local government, it will be taken as an entirely separate item, purely to ascertain that the money is being well and appropriately used? Most importantly, will he assure us that it will never affect the existing levels of transport support? Without such an assurance, we are looking at a poll tax on wheels.

6.22 p.m.

Lord Hoyle: My Lords, this has been a well-informed debate and a credit to the House. I support integrated transport and congratulate my noble friend on what he said in relation to the help being given to pensioners in regard to travel and bus passes.

However, perhaps I may turn to the one point which particularly bothers me and about which I want to speak tonight; that is, NATS. I know that both my noble friends on the Front Bench will give way to no one in relation to safety, and the same applies to my right honourable friend the Secretary of State in another place. That is why, despite all the explanations given, I am still extremely puzzled as to why we are throwing away NATS, which is a world leader in relation to public safety. Indeed, the Minister has said on occasion that the world looks to us in this particular field.

It appears that the explanation being given involves the question of investment in NATS over the next 10 years. The investment in NATS over the past 10 years was £1.2 billion and, as I understand it, the investment

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over the next 10 years will be just £1 billion. That can be broken down into only £100 million per year. We can also take into account that NATS will generate profits, part of which will go towards that investment figure. For the life of me I cannot see why the rest cannot be borrowed from the Treasury as loans and be repaid, as it has been in the past, with an interest rate of around 8 per cent. Why, therefore, are we destroying a world-class organisation?

My second point is that, if we cannot keep NATS, I would prefer a free-standing company like the privatised Post Office which can raise finance independently, if necessary, though the Treasury may not agree. I would also support a model such as that being advocated in Canada, which is a non-profit-making trust. The advantage of those systems is that they put safety foremost. That is my problem with the solution put forward in the Bill.

Air traffic control is quite different from airlines and airports, whether British Airways or the CAA. NATS is concerned only about air traffic control, and therefore primarily with the safety of its operations. What happens if it becomes a public-private company? There must be a return for the shareholders. Where will it come from? That is the dilemma I face. Will it come from cutting the operators or from increasing charges to the users? It must be one or the other. That is a particular problem.

Having said that, there is no doubt about the cynicism of the arrangement when the two opposition parties come together. When one prefers the trust model--for which I have a preference--and the other complete privatisation, one can only conclude that the object of the exercise is to defeat the Government. It will be viewed therefore as a purely political manoeuvre.

When we examine the proposals before us in this Chamber, like my noble friend Lord Clinton-Davis I hope that the Government will think again. If we retain the present model, are there ways in which it can be improved? For instance, why cannot there be an employee representative on the board? It may be said that the interests of the shareholders have to be put first. But surely those interests will be primarily linked to safety. And the employees must have just as great an interest as the shareholders in seeing an efficient and safe company. Their being represented on the board would ensure that safety was kept right at the forefront.

My noble friend may say: what about the strategic partnership? That is all very well, but it must be remembered that it is only a consultative body, due to meet biannually. It is said that it can demand other meetings. But that cannot make it an effective watchdog.

My other anxiety relates to the government shareholding. At the moment it is to be 49 per cent, with 46 per cent owned by the new partner or partners and 5 per cent by the employees. But we also learn that it can be floated on the Stock Exchange and the Government's share can then be reduced to 25 per

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cent. What control will we then have? Surely we do not intend to rely on a golden share, or special share. That has never been effective. Indeed, it never prevented the sell-off of other companies that possessed such a "special" share.

Further, can my noble friend the Minister say whether this has been cleared with Europe? In other words, has the issue of whether we can even have a golden or special share been discussed with the Commission? Surely we must clear the matter with the EU. I know it is said that it may be cleared because security comes into the matter, but could not this also lead to problems with the MoD? We have already heard that there are some misgivings on the part of the RAF; indeed, there are certainly murmurings in that respect. It seems to me that we must retain some public control if security matters come into the equation.

I know that the document spells out the fact that training will be paramount and that there will be no dilution in the training offered. However, we must ensure not only that the standard is maintained but also that it is improved. We shall need better training because, whatever the right reverend Prelate would like to see, the amount of air traffic will grow. It is estimated that it will grow by at least 3 per cent a year. That means more congested skyways. I hope that my noble friends will consult with the unions in this respect. I also hope, like my noble friend Lord Clinton-Davis, that they will have further talks with the pilots who have expressed grave concerns about the safety issues that could arise.

There is one further issue that I should like my noble friends to consider both now and in Committee. I refer to the level of pensions now paid. Could we not have the same safeguard that was offered to London Transport workers by such provision being written into the legislation?

Unless there is a change of mind, I know that at the end of the day the present pattern that we have of a public/private partnership will be maintained. However, I ask that we look again at strengthening the public control in relation to it and that we also ensure not only that safety is paramount but also that such provision is written into the Bill.

6.31 p.m.

Lord Bradshaw: My Lords, speaking at the bus summit on 9th November last year, the Deputy Prime Minister said that,


    "the bus holds the key to improving public transport locally".

He said that,


    "in many people's minds it is not even today's product, let alone tomorrow's",

and that,


    "we need to break through that way of thinking, if we are to see a progressive, forward looking industry seizing the challenges which lie ahead".

On these Benches we endorse those sentiments but believe that, as this Bill is the only piece of legislation affecting buses which the Government have or are likely to table in this Parliament, the great transformation will not take place. This is a great pity

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and a great waste, as buses are the cheapest, most readily available means of changing people's travel habits.

Above all, to be efficient, bus services need a clear highway along which to drive. We look for two changes in legislation to achieve this aim. First, we need the extension nationwide of enforcement by camera technology of the law relating to the abuse of bus lanes, yellow box junctions and banned right-hand turns. It is no use giving offenders the option of a £20 fixed penalty ticket, which was last reviewed in 1992. Government must prevail upon the police so that officers are available to review camera records and institute prosecutions. Local authorities should keep the revenue raised to fund better enforcement. We seek an immediate extension from London of the use of enforcement cameras and look to the Government to bring forward the necessary amendments at Committee stage. This requires a simple amendment to the Road Traffic Act 1991, Schedule 3 of which gives the Secretary of State wide powers only in respect of stationary vehicles. These powers need to be extended to include moving vehicles.

Secondly, we must protect marked bus stops from illegally parked vehicles. Several noble Lords have spoken about the needs of disabled people. It is absolutely no use the bus industry buying accessible buses if they cannot pull into the kerb. The daughter document to the transport White Paper, From Workhorse to Thoroughbred, held out the prospect of action in this area. Have the Government come to any conclusions in their consideration of designating bus stops as urban clearways and of an effective means of enforcement? At the bus summit the Deputy Prime Minister said that,


    "when road space priority is designated it must be respected".

We look for delivery against that commitment.

The Bill makes many references to the traffic commissioners. They will have the responsibility for an extension of the scope of traffic regulation orders and for enforcing quality partnerships. In his reply, I should be grateful if the Minister could explain how the commissioners are to deal with an operator who is excluded from a quality partnership and to whom an excluded operator might appeal. Would this be to the traffic commissioners? The traffic commissioners need adequate resources, not only to carry out any new tasks that come to them as a result of this Bill but also in order to discharge their existing duties. Operators pay for this enforcement through their operator licences. We should like to see the powers of the traffic commissioners extended.

I asked someone in the Library of the House to conduct a small exercise for me comparing the resources available to those regulating safety and the railway generally--the rail regulator and the railway inspectorate--with the resources available to those involved in regulating road traffic. I found that although the tasks to be carried out by the traffic commissioners have increased, their resources have not. Conversely, the number of staff employed by Her Majesty's Railway Inspectorate, referred to by the

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noble Baroness, Lady Gibson of Market Rasen, in her maiden speech, has greatly increased since the old railway inspectorate was replaced by the staff of the Health and Safety Commission. Therefore, we are looking for some evening-up of this use of resources.

We shall move amendments to extend the powers of the traffic commissioners in three areas. First, we believe that they should have the power, not to reject a registration of a bus operator, but to vary this when, in the opinion of the commissioners, this is intended to disrupt the business of another operator--the old tactic of registering a departure two or three minutes ahead of that of a rival. When a similar amendment was moved in Committee in another place, the Minister said that the traffic commissioners' existing powers, coupled with the safeguards provided in competition law and the possibility for the Office of Fair Trading to intervene--now enhanced in terms of speediness--were sufficient.

We are not satisfied that the OFT will move speedily; it has never done so before. We also believe that some simple guidelines can be drawn up to assist the traffic commissioners in exercising judgment which, if published, would act as a guide not only to them but also to bus companies in making registrations. It would be much less bureaucratic and expensive than involving the OFT. Of course, any decision by the traffic commissioner could go to appeal. I shall return to the traffic commissioners in the few remarks that I wish to make about lorries.

When he concludes the debate, can the Minister give the House any news as to when the Government intend to table amendments to the relevant regulations to abolish the five-minute rule and to extend the existing period of notice of de-registration of bus services from 42 to 56 days? These changes were promised in Committee in another place. Both of those changes would be welcomed by those who have to provide timetable information and by local authorities that have to let tenders to replace services which are withdrawn.

Like many other noble Lords, I have read the draft consultation document circulated by the Office of Fair Trading on 8th May on a block exemption order relating to public transport ticketing schemes. This proposes a block exemption for a limited selection of tickets sold under statutory quality partnerships. In our view, the approach of the OFT is too narrow in being limited to ticketing schemes, and I understand that it does not apply retrospectively to voluntary quality partnerships or to other arrangements in respect of tickets, including road/rail tickets. Similarly it does not apply to joint co-ordinated timetables, joint publicity or shared routes. Unless the scope of the block exemption is widened considerably, there is the real prospect of various existing arrangements which benefit passengers being struck down because they offend the purity of the theory of competition law.

Again I quote the Deputy Prime Minister:


    "We have also got to see transport marketed more effectively as a single product regardless of operator. That means ticketing that meets the needs of users rather than operators".

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Can the Minister assure the House that the genuine concerns of the industry and of users are appreciated and that urgent discussions are taking place with the DTI and the OFT to preserve the degree of integration which has already been achieved and to extend that?

There is a strong wish on these Benches to see the market for the provision of bus services being contestable. That involves taking strong action to prevent predation and the abuse of dominant positions. This is necessary so that the tendering process will work. But contestability does not require the outlawing of sensible co-operation, marketing and ticketing which benefit the consumer.

We warmly welcome the provision of half fare passes to pensioners and particularly the extension to the blind and the disabled announced this afternoon. However, we believe that the Government should go a little further. We do not believe that this will cost much when the generation factor--that is, the extra people who use bus services because fares are lower--is taken into account. We very much hope to hear from the Government that all persons over 60, men as well as women, will benefit. For example, I received a letter offering me a winter fuel rebate although I am not yet a pensioner. It appears that the Government can change the rules about age limits to suit a particular case. Our greatest wish is to see the concession for buses extended to those in full-time education up to the age of 18. Often young people buy old cars and increasingly are driving them to school. Travel costs bear heavily upon them. We believe that government could and should negotiate a good deal with bus companies in introducing this change.

Quality partnerships as envisaged in the Bill will not cover frequencies and fares. These are important features of any service. We have noted statements that these issues might be addressed in a non-binding codicil to quality partnerships. The issue was raised by the noble Lord, Lord Morris of Manchester. I suggest to Ministers that our misgivings might be assuaged if it were possible to include a kind of passenger service requirement as is found in railway franchises--a kind of baseline level of service--and that fare rises should be limited to a special bus industry cost index; that is, there would be no real fare rises except rises in costs specific to the industry.

I conclude with a couple of references to road haulage. As a member of the Commission for Integrated Transport I was disappointed by the announcement that 44 tonne lorries were to be introduced without the accompanying package of measures. I am pleased that work is going on within the shadow Strategic Rail Authority to put together schemes to facilitate the use of rail by customers who might be attracted to using that mode. I hope that the necessary funding will be made available. I was also pleased to see as part of the Bill the proposals on impounding vehicles introduced in this House in the previous Session of Parliament by the noble Earl, Lord Attlee.

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However, further changes are needed. These include--as the noble Earl, Lord Attlee, proposed--the fact that a lorry driver stopped for exceeding hours should be obliged, on the spot, to take a full period of rest before proceeding. It is wrong that in any field of transport a driver or a pilot should be permitted to remain in control when he has been found to be exceeding permitted hours. For the Government even to consider bringing charges of corporate manslaughter against directors of transport companies while this lacuna in the law continues, with ministerial indifference, is unacceptable. I have the word "connivance" in my notes, but I shall refer rather to ministerial indifference. As the Minister said in relation to NATS, safety in transport is a paramount interest.

We shall seek to move two amendments to protect those living on estates and weight restricted rural roads from "rat-running" by large lorries. We shall seek to make it much easier to prosecute drivers of lorries using prohibited routes. The present system does not work. We shall seek to extend the authority of traffic commissioners in granting a licence for the establishment or expansion of vehicle operating centres to have regard to the suitability of the highway network in the area and to provide that the commissioners should approve centres of bus operations. When an operator is called before a traffic commissioner on a disciplinary matter it is often the case that undertakings are given concerning future behaviour. We are not satisfied that these are enforceable and hope that the Government will be persuaded to bring forward an amendment to remove the doubt which exists.

The road haulage industry will benefit substantially from the introduction of 44 tonne lorries. I and many colleagues on the Commission for Integrated Transport believe that it is time that those whose lives are put at risk or those whose lives are blighted by heavy lorry activity deserve the protection which would be afforded by these minor amendments to the Bill. We believe that we are asking only for what the Deputy Prime Minister promised when he said:


    "Any drivers and operators who persist in using unsafe vehicles or breaching drivers' hours legislation can expect to be dealt with severely by the Traffic Commissioner or by the Courts".

Many such people never appear before any court, let alone face meaningful penalties. This must change. I look forward to supporting most of what is in the Bill. However, I shall do so more gladly if we see some of the amendments I have mentioned.

6.46 p.m.

Lord Hogg of Cumbernauld: My Lords, I am pleased to be able to contribute to this important debate. Transport has been an interest of mine for a long time and throughout my parliamentary life. At one stage I was chairman of the all-party Road Passenger Transport Group. Therefore I am delighted that transport is such a high priority of the Government.

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An efficient transport system is vital not only for the economy but it is essential also for the environment. That is why I am pleased that the Government have introduced the Bill that is before the House. It is the right Bill at the right time.

The Bill is a comprehensive measure. That fact alone has attracted criticism, but not criticism that I feel able to echo. If we are to create a fully integrated transport system across the UK, that objective is bound to be reflected in the enabling legislation; hence a large Bill.

I wish to concentrate on a single area of the Bill, that which deals with buses. Here I must declare an interest. I have just been appointed chairman of the Bus Appeals Body. That is the independent body set up by the bus industry in conjunction with bus passengers to arbitrate on passenger complaints. It is a good example of the increasing customer focus of today's bus industry. I pay tribute to the noble Lord, Lord Bradshaw, who preceded me in that office and served the body with great distinction.

A key element of the Government's transport strategy is to give people more choice. No one needs to be persuaded of the benefits of more people choosing to leave their cars at home and use public transport. But people cannot be forced to do that. People must make that choice because public transport is a better option. It has to be reliable. They must choose it because it will not get caught in congestion; because highway authorities have given it priority road space; because it is clean; because it is accessible; and because you do not have to park your car at the other end--in short, because it is in every way convenient. In towns and cities across the UK the bus is uniquely positioned to provide the service I have just described. The message I hear from bus operators is: "Give me the operating conditions and I will invest and deliver a high quality service".

The 1985 Transport Act brought about significant changes in bus operations in the UK. Not surprisingly, the results were mixed. The aim of this legislation should be to build upon the positive results of that legislation. There are many positive results, not least in record levels of investment in new vehicles. This Bill seeks to remove only the negative results of the 1985 Act. The Government have got that right.

The Bill will put in place measures which ensure that bus operators and local authorities work together on a formal basis using their respective expertise to the best effect. In the first instance, local authorities are required to produce bus strategies as part of their local transport plans--a sensible measure in my view. But I have two pleas to make.

First, the Government's guidance must be strong. The Bill as it stands allows for the imposition of a quality contract where a local authority feels that it is the only practical way to meet its bus strategy. Many interested parties--not least passenger groups through the National Federation of Bus Users--along with the industry itself, feel that bus services would suffer as a result of these contracts. Some local authorities have made it plain that they are keen to go straight to contracts, which is a clear departure from government

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policy. It is vital therefore that firm, clear guidance is given to guard against quality contracts introduced by the back-door.

My second plea relates to consultation. The Bill compels local authorities to consult when developing their strategies. This is a welcome move. Bus operators in particular have built up great expertise over the years in providing services--a positive aspect of deregulation. They have also shown innovation in the services provided.

While the Bill compels consultation, it does not compel local authorities to heed that consultation. No doubt my noble friend the Minister will say that this is implicit in the clauses, but I should value his reassurance from the Front Bench when he responds to the debate.

This brings me to quality partnerships. The Government have stated that the quality partnership approach will be the corner-stone of their proposals for bus service provision. This is something else that I welcome. Voluntary quality partnerships operating throughout the country have shown impressive increases in passenger numbers. Placing these partnerships on a statutory footing is the next logical step. This will allow local authorities to invest in highway schemes secure in the knowledge that bus operators will provide quality services to run on them. Similarly, bus operators will be able to invest in new, high-quality vehicles that they can run reliably in a congestion-free environment.

These partnerships must not be too prescriptive. They must be flexible enough to meet differing needs in different areas. A rural quality partnership will be different from one in an urban area.

They must be partnerships in the true sense of the word. Quality partnerships are a marriage of different areas of expertise, including road planning, service provision and enforcement. Care must be taken to ensure that local authorities do not become too prescriptive in the conditions that they set. It is unlikely that bus operators would be willing to continue their present high levels of investment if control of their assets lay elsewhere. Conversely, it would be quite wrong for bus operators to take the lead on infrastructure planning. Consultation and partnership must be the bywords for a successful quality partnership.

I have followed the remarks of Ministers in another place during the passage of this Bill, and I fully agree that voluntary agreements on service provisions such as frequencies should run alongside statutory provisions. This will guarantee partnerships in the true sense.

I know that anxieties have been expressed about the effect of the Competition Act on partnership arrangements. It has been said that this Act legislates against integration and co-operation. Ministers will need to ensure that this does not prove to be the case. I welcome therefore the new schedule added to the Bill by the Government. This sets a firm competition test for the statutory aspects of quality partnerships. I note what the Government said on the need to consult the

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OFT on the non-statutory aspects of quality partnership arrangements. I hope that my noble friend can join me in urging the OFT to do everything that it can to facilitate agreements, both voluntary and statutory, which are made in the public interest.

I must tell my noble friend that I have some difficulties with quality contracts. I have studied the proposals carefully and share the views expressed by the Confederation of Passenger Transport and the National Federation of Bus Users. Quality contracts will not provide passengers with the best services. I have looked at the report of NERA (the National Economic Research Associates) into the franchising of bus services--and franchising seems to me to be the effect of quality contracts. NERA believes that franchising would result in more public expense, less investment and less flexibility. I have some sympathy with that point of view.

The imposition of a quality contract would be most unfair on the bus operators, large and small alike. They would lose business as a result. As I say, the large operator would see his ability to invest diminish, and there are serious implications for the workforce. The problems would be worse for the many small, family-run businesses. For this group, losing out on a franchise would mean relocation--an impractical solution. Going out of business seems much more likely. There would be no compensation, and the Government may like to address that issue when we come to the Committee stage of the Bill.

I understand why proposals for quality contracts have been included in the Bill; they are intended as a safety net. However, they should never be a last resort. I hope that I shall receive some assurances about this when the Minister responds to the debate.

I do not wish to end on a negative note. I am a strong supporter of this Bill. A high quality, fully integrated public transport system, backed up by strong investment, is vital for the United Kingdom in the 21st century. I believe that this Bill will go a very long way towards achieving that for our people.

6.56 p.m.

Baroness Greengross: My Lords, I should like to concentrate on two issues, the first of which relates to congestion charging. I shall focus on London because it is the area that I know best. It is probably my simplistic attitude, but I admit to being somewhat puzzled. We seem to have a straightforward logistical problem but we do not seem to be able to find a straightforward answer.

We know that we have run out of road space in London and, therefore, in order to give people the mobility that they need, we have to make better use of the road space that we have. Already 85 per cent of commuters come into central London on public transport, but we still want to get people out of their cars and into the centre by public transport. We have to get people to make the change onto public transport, and we have to decide what they should

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travel in or on to get into central London if they make that change. Obviously other major cities have similar problems but they are perhaps most acute in London.

We know that the Underground system is running above its capacity during certain parts of the day. It is very difficult to get more people onto a service which is already over full. It would be a marvellous solution if we could run longer trains--but we cannot make longer platforms in our deep tube system to allow people to board longer trains. That is rather sad.

We could do many other things which I feel your Lordships would not appreciate. For instance, we could take out all the seats on the Underground and get many more people onto the trains, but that is not something we would consider. We know that the new signalling systems will allow trains to run safely at closer intervals to each other, but that will not do a great deal to increase capacity. We could do other things which I think would be undesirable. For example, we could encourage trains to stop at every two or three stations instead of at every station, but I do not think that passengers would want that.

So we are left with one resource in the centre of the city--that is, buses. I think most people see them as being unattractive and unreliable in many ways. We need to address those issues if we are to make proper use of our buses.

We need, first, to aim to speed them up. Secondly, they should arrive at frequent, proper intervals, not all together. Only congestion charging will achieve those aims. However, we face a problem because many people have put forward persuasive reasons for delaying the imposition of congestion charging until an adequate public transport system is in place.

However, it is difficult to understand how a proper, efficient bus service can be introduced unless a form of congestion charging is introduced first in order to facilitate better public provision. We shall not be able to make the patient better until we adopt the only realistic alternative option; namely, congestion charging.

The enforcement of bus lanes will help, but such lanes cover a fraction of most bus routes and are operational for only short periods of the day. We need only to step out of this building to see that traffic jams build up throughout the day, as well as through much of the evening. If bus lanes are extended and their hours of operation lengthened, enforcement would soon become impossible. It is not easy even to enforce the bus lanes already in place. For those reasons, the problems will remain unless charging is imposed quickly.

Perhaps I may turn briefly to the issue of concessionary bus fares for pensioners, who will increasingly use the improved bus services. However, first I should like to echo the pleasure expressed by the noble Lord, Lord Morris, for the new provision announced earlier by the Minister which will benefit disabled people of all ages. However, I am concerned about the discrimination that currently applies to men aged 60 to 64. The situation is unfortunate and may result in further legal action against the Government

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because, for the first time, a requirement is to be placed on local authorities to offer transport concessions. Given that, at one of the two levels of the European courts, this anomaly could lead to further action following the failed earlier case. Perhaps the Minister could indicate whether the Government are now considering proposals to equalise the concessionary age, preferably at 60 years, although it is most important that equal treatment should apply to everyone.

Another point to bear in mind as regards the concessionary scheme is that it is not national; rather, it is a nationally set minimum standard. Many pensioners think that they will be able to get half-price travel wherever they go. However, that of course is not the case at the moment. The concessions will apply only to transport within people's own local authorities. They will be very disappointed if they find that they cannot travel out of their local area to visit a doctor or to go shopping unless all local authorities reach agreements with each other. Rather than waiting for reciprocal deals to be made between local authorities, perhaps the Minister would consider providing for pensioners automatically to receive the minimum standard wherever they go. That would be simpler and would avoid disappointment.

7.4 p.m.

Lord Hughes of Woodside: My Lords, I welcome the Bill, especially because it aims to bring about a more integrated transport policy. For many years that has been the principal aim of those interested in transport. It looks like some progress is about to be made in that regard. The key to establishing an integrated transport system lies not so much in regulation and introducing different schemes but in ensuring that sufficient money is invested in the system. The key lies in adequate investment.

A little over a decade ago I was the Front-Bench spokesperson for the Labour Party looking at integrated transport policies. One of the principal points of discussion was how to get around the Treasury rules. As a former chairman of British Rail, the noble Lord, Lord Marsh, will recall the mechanism called the external financial limit which allowed the government of the day to determine each year how much a publicly owned industry could spend. The question of how money was raised was not at issue; the limit covered only how much could be spent. At the time British Rail was experimenting with private finance initiatives on a small scale for privately owned sidings allowing provision for privately owned rolling stock. That did not give British Rail more money to spend on its day-to-day objectives; in fact, it meant that it could spend less. The system was ludicrous. The problem with the Treasury rules is that over the years they have interfered far too much with the implementation of government transport policies.

I believe that there will be a general welcome for the mandatory travel concession system set out in the Bill. Again, the establishment of a countrywide minimum standard is something that we have long sought to achieve. However, I accept that there may be problems

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as regards cross-authority agreements. Nevertheless, I welcome in particular the announcement made today by my noble friend Lord Macdonald of Tradeston concerning the extension of the concessionary fare scheme to the blind and the disabled. That is very welcome.

It has been clear from the contributions made in our debate that the Bill is not without controversy. No doubt those issues will be discussed in great detail both in Committee and on Report. I am sure that the clauses in Part III dealing with road user charges and workplace parking levies will not receive universal approval. Indeed, the noble Lord, Lord Dixon-Smith, has made his position clear. However, I suspect that in this, as in many other areas, a certain degree of "Nimbyism"--not in my back yard--may have been evinced. The theory is all well and good, but in practice individuals will object to paying congestion charges or contributing to workplace parking fees. Indeed, I receive frequent press notices from private companies declaring that congestion is costing the taxpayer dear and is expensive for the consumer. However, once a solution is suggested, that is another matter. Congestion is rather like sin--everyone is against it. And, of course, as far as congestion is concerned, it is always someone else's car that is causing the problem, not the car being driven by oneself. A little humility is called for in this area.

Without doubt, the most controversial proposals in the Bill are those covering the public-private partnership for National Air Traffic Services. My noble friend Lord Clinton-Davis made a powerful case, as did my noble friend Lord Hoyle. I suspect that others will also put forward their views. I have great respect for my good and noble friend Lord Clinton-Davis. We served together in the House of Commons for a period. He was a distinguished Transport Commissioner in the European Commission. I respect his views very much. From time to time we even used to play golf together. By the time my noble friend is once again fully fit, I may even have been able to save up enough money to buy a golf ball as a side stake when we play one another. I look forward to that.

As regards NATS, the issue is not so much one of ownership but rather of how sufficient finance can be injected into the system. The issue is also primarily one of safety. How can we ensure that safety remains paramount? Basically, there are two sides to this equation. Let us take, first, the position of the Government and the Civil Aviation Authority. I am sure that everyone will have received a letter from the chairman of the CAA stating that he believes that safety will be guaranteed under the provisions of the Bill and that the separation of powers between the CAA and the newly formed NATS will be sufficient to guarantee continuing high safety standards. However, the trade unions have argued that the safeguards are insufficient. Oddly enough, they say that NATS currently operates to a higher standard than allowed for by the CAA. There is something curious about that. If that is the case it may well be that stronger provisions in terms of safety are needed on the face of

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the Bill. But there is a dilemma as to how far we regulate each time standards change. We need the highest standard of safety.

I used to take the absolutist view that "private sector" equalled bad safety and "public sector" equalled good safety. I recall the argument at the time when British Caledonian Airways was to be set up. Routes were stripped away from the British Overseas Airways Corporation to set up the new private company in the interests of competition. Incidentally, that took place under a Labour government. One of my noble friends on this side of the House was a Minister at the time. British Caledonian no longer exists--but not because it had a bad safety record. The company no longer exists because it was effectively going bankrupt; there was no safety issue was involved.

I have scars on my back from defending to the hilt Dounreay as a place of the greatest safety. Sadly, I have been proved wrong. I recall vigorously defending the people at Sellafield and saying how safe it was. Now we find that there was systematic falsification of documents. That is a public sector company, and always has been. However, I do not now take the opposite view that public ownership means bad safety and that the private sector automatically means good safety. I have not yet crossed that line or made that 180 degree turn. I still believe that we need absolutely stringent standards.

I am interested in one of the dilemmas that may be resolved at a later stage. There remains confusion as to the views, in terms of voting, of the Liberal Democrats on the one hand, who have said that they are in favour of a trust and are opposed to any privatisation--incidentally, a trust would mean moving out of public ownership--and the Tories, who have stated their belief in full privatisation. We have heard from the Liberal spokesman, the noble Baroness, Lady Thomas, that there has been no collusion between the two parties--and Members opposite are vigorously shaking their heads. But as my noble friend Lord Hoyle said, it is not collusion--


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