Examination of Witnesses (Questions 280-299)|
WEDNESDAY 26 JUNE 2002
280. Are you aware that GNER said last week
that, on a number of occasions, because the advice to the SRA
outgoing chairman was overruled and they were only give a two
year franchise, they are not now in a position to make the investment
in the carriages that they had wished to do? Do you have the current
position on that?
(Mr Steer) The position, as we understand it, is that
the commitments that were made when the limited extension was
granted are being progressed. I think perhaps GNER are making
the point that, beyond that and looking at further investment,
a two year franchise is an inadequate basis, in their view, for
making further investment decisions, and they are right.
281. So the passengers and the travelling public
will lose out during those two years by not having carriages.
(Mr Steer) No, I do not think so. We feel quite comfortable
that in fact the two year franchise extension has been able and
is demonstrably able to deliver short-term benefits. That is already
reflected in a significant improvement in the timetable this year
and there will be further benefits next year and there will be
further capacity added. What we certainly acknowledge is that
that is just the short-term and of course the medium-term has
to be addressed and it will have to be addressed through a new
arrangement following on from 2005.
282. It is just that, in the meantime, we will
not have the carriages that we otherwise would have had. Are you
aware of the impact that the disruption to freight trains through
the Channel Tunnel is having on rail transport in the north of
England, in particular on companies like Potters in my constituency
who have rail heads at Selby and Ely? The freight that they would
normally hope to carry on trains from about November of last year
are now being transported by road. So, not only are you not meeting
the targets set out in the Government's ten year transport plan
but can you confirm that you are not meeting the targets set out
in your strategic railway plan?
(Mr Steer) Thank you for the local information; I
would not claim to have all of the details. Of course, you are
right that there has been a major loss in international freight
business and I acknowledge the difficulties it may cause. In terms
of achieving the freight target, which is not set specifically
on international traffic, important though that may be, the progress
that has been achieved over the last 12 months is actually remarkably
encouraging, particularly against the backdrop of not as reliable
a network as we would all like to see. The figures that the rail
freight group have established and published, I believe just earlier
this week, show an 8 per cent year on year growth in freight miles
carried, which is quite in line with, in fact it is slightly ahead
if you compound it up, the 80 per cent target over 10 years. So,
yes, the international position is very disappointing. No, it
has not damaged the achievability at this juncture of the freight
283. Arriva seems to have sorted out the situation
they inherited from Northern Spirit in terms of shortage of drivers.
They suffered a very difficult winter but I think they now have
enough drivers. However, now there is a problem with guards wanting
to reduce the differential in pay and conditions with the drivers.
Do you have a view on the damage that is causing to the travelling
(Mr Newton) We know that Arriva are in industrial
dispute and they have not been able to reach a settlement with
either the conductors or indeed retail staff. They have made an
offer, as we understand it, which is above the budget that they
have for the current franchise year and it is unfortunate that
there is a continuing dispute. The managers are trying to manage
the situation as best they can without incurring what they consider
to be unreasonable additional costs.
284. Your infrastructure investment programme
seems to be very concentrated in the south. Could you tell us
why that is and what you are going to do to give the north a better
(Mr Steer) I know that this has been a pretty widely
expressed view following publication of the strategic plans. I
have to say that I do not really believe that it is a fair criticism.
If you look at the large spend projects, and I mentioned two of
them in my introduction, they are, as much as anything, focused
on delivering benefits to the northern part of the country and
it may be that commentators and observers have sort of taken them
for granted and therefore look for the next project but, as
285. Mr Steer, that is an opinion to which you
are of course entitled but it is different from that of your Chairman
who gave us different evidence, but perhaps we could move onto
(Mr Steer) My answer, if I may just complete, Madam
Chairman, is that I do not believe that a fair criticism is that
the investment is biassed unduly towards the south. Yes, it is
true that there are more passengers focused on Londonwe
are all well aware of thatand I am sure that we are also
well aware of the fact that the railway geography of the country,
some important exceptions aside, Trans-Pennine being one of them,
is focused towards London. The major routes go to London and that
is where the major investment is going. However, that does not
mean that the investment is in the south of the country and it
certainly does not mean that the benefit of that investment is
in any way, in my assessment, skewed towards the south of the
286. What kinds of assessments do you make to
consider where the benefits actually go? You have just said to
us, "This is what we are doing but it does not necessarily
mean that the benefits are in the south rather than the north."
What work do you do to ensure that that indeed is the case?
(Mr Steer) We do look at the pattern of benefits.
We do not have some allocation proposition that each region should
have a certain share. We look at what gives good value for money
and what I can say is that a very large part of the investment
programme that the SRA is striving to implement does arise in
the north of England.
287. Do you study the regional economic strategies
and the regional transport strategies produced by the regional
(Mr Steer) We do.
288. What use do you make of them?
(Mr Steer) As yet, not enough.
289. Can I ask you again, what use do you make
of them? Are you saying that you do not make any evaluation?
(Mr Steer) Let me explain, if I may.
290. Briefly, Mr Steer.
(Mr Steer) The West Coast Upgrade Project/the East
Coast Upgrade Project were envisioned, to use that horrible word,
before there were regional economic strategies and regional transport
strategies. We need now to be looking to ensure that those big
projects deliver regional objectives. I do not have a problem
that fundamentally they go against regional objectives. I know
that indeed the way most regional plans have been written is that
they expect those projects to be delivered, they accommodate them,
but I think that the challenge for us in the strategic plan is
to go the next step and make sure that, at a more detailed level,
we are meeting regional objectives. I think it is simply a matter
of sequencing, that regional planning in this country is quite
a new phenomenon. These projects are of very long gestation period.
291. When you are making your assessment of
value for money, do you put regional economic regeneration as
part of that assessment?
(Mr Steer) Not necessarily. We are looking at overall
value for money irrespective of where the benefits lie.
292. So the issue of regional economic regeneration
is not part of your assessment that guides your investment plans?
(Mr Steer) What I am saying is that it has not been
in the preparation
293. Is it now?
(Mr Steer) It is what we are addressing and will be
addressing as the strategic plan is developed.
294. Will we see the benefits of that within
the 10 year transport plan period?
(Mr Steer) You certainly will.
295. Could I start on the situation in Manchester.
We have taken quite a bit of evidence that indicates that there
are fundamental problems with expanding services in Manchesterwe
are changing the franchise structure; we are introducing the Trans-Pennine
Expresssimply because a number of key bottlenecks are chock-a-block
with services already. Can you give us the SRA's perspective on
(Mr Steer) We certainly do not believe that the rationale
for the two franchises being restructured in the way we are doing
is driven by the particular concerns in Manchester, but I accept
the point. There are problems in Manchester; they will not be
driven out by restructuring the franchises, neither will they
be made worse by the restructuring of the franchises.
296. What are you doing about the problem?
(Mr Steer) First of all, let us identify what the
problem in Manchester is. One of the well known problems in Manchester
is that it is a bottleneck in the rail network and, in particular,
Manchester Piccadilly is a bottleneck. We are supporting the West
Coast upgrade which happens to be the project which is set to
tackle that problem. It has not gone well to schedule.
Andrew Bennett: It has nothing to do with that
problem at all.
297. I thought the key point about Manchester
was that there are specific plans to improve the network in and
around Manchester that have been left outside the first ten years
of the SRA's strategic plan. That is why we were surprised because
they were originally in the Government's ten year plan but they
were excluded from the SRA's strategic plan.
(Mr Steer) The case could not be made at the time
the strategic plan was put together to include them.
(Mr Steer) When I say that the case had not been made
299. Because the work had not been done?
(Mr Steer) No. There was no positive case that could
be made for those investmentsthey are not cheap; they are
big expensive projectsand, at the time, the Manchester
study had been completed and I pointed towards some options: Tram-Train
was a concept and further light rail on the national network;
possible new links; a western link to Manchester Airport; a new
link at Castlefield in the centre of Manchester