Lords Grand Committee
Wednesday 21st October 2026
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16:15
16:15
Speaker 2
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Speaker 2
My Lords, this group of amendments is a bit of a ragbag covering a broad and diverse range of topics. I hope noble Lords will understand if I take the full time available to me, or something close to that, in order to cover at least those amendments which stand in my name. Amendment 213 my Lords, requires new services provided. Passenger services provide provided by Great British Railways to operate on a regular basis. As I've said before, there's something tremendously backward looking about this legislation. When we think about the lack of anything in it, about new technology and the way of working that the new Great British Railways might adopt, and one of those respects is in one of those respects is, is working practices.
We've seen very recently on Chiltern Railways, the RMT once again objecting to proposals for driver only operation on the new East West rail services, even though on other Chiltern Railway services, I appreciate Chiltern Railways has now had its franchise recently terminated. But on other Chiltern Railways services, driver only operation operates very satisfactorily. As an occasional customer of Chiltern Railways to Solihull and Birmingham. I'm very aware of that. I appreciate that. I'm not saying that's the only reason that the East West rail service is not operating, but it's been a significant point and. They argue that the arrangements are watered down safety because the second member of staff would necessarily perform a safety critical train manager role.
But Chiltern has confirmed that every East West rail service will still have two people on board. The driver and another colleague responsible for looking after passengers, checking tickets, assisting those who need help and dealing with issues on board. Chiltern has also made clear that it has operated most of its trains, as I say, but the driver controlling the doors for decades. And that brings me to the purpose of this amendment. If we are creating great British Railways, we should also be looking seriously, as I say, at how the railway can operate more efficiently. And I know the noble Lord would probably want to say that this is all a matter to be entrusted to Great British Railways once it's up and running, but it's a matter in which the public and Parliament, I think, have a very legitimate interest, and it would not be inappropriate to have something along these lines.
On the face of the Bill. We should not automatically preserve working practices simply because they have existed historically, particularly where technology and modern operating practices mean that they're no longer necessary. Driver only and driver controlled operation are hardly novel concepts. The independent safety regulator has previously concluded that with suitable equipment, proper procedures and competent staff in place, driver only operation can be a safe method of working. The current guidance similarly makes clear that driver controlled operation can meet legal safety requirements, where the proper systems and safeguards are in place. This amendment, therefore, establishes a clear presumption that the new , new, new GBR passenger services should operate on a driver only basis that would allow GBR to design new services around modern and efficient operating practices from the outset, rather than importing unnecessary staffing requirements into every new service.
And bear in mind, of course, that GBR will be much more vulnerable to industrial action in the future as, as has been discussed in other groups, there is an eventual drift, as I'm sure there will be if the unions get their way. The single to a single employment. Crucially, however, the amendment does have a safety override because it includes a provision in subsection three expressly giving the Orer the power to exempt a service from this requirement, where it is satisfied that driver only operation would create an unacceptable risk to the safe operation of the railway.
If Great British Railways is genuinely going to deliver a more efficient rail. It must have the ability to modernise the way in which new services are operated while maintaining the highest standards of safety. Turning to amendment 305 A and 305 B 305 A is about ensuring that as employees move into the new structure, existing employment liabilities move with them in an orderly and transparent way. Now, I can say to noble Lords that this amendment has been tabled by me at the urging of rail ten, which is the body that manages the Railways pension scheme. I'm sure they've made similar representations to the government, and I wish to hear how the government responds to them.
The. Nearly everybody who works on the railway has a pension scheme. There are multiple schemes, but they come under the umbrella of the same railway pension scheme, most of them, nearly all of them, and their management structure goes under the name of their management agent, goes under the name of Railpen. And they have explained very clearly that if there is to be a transition of staff and the pension, the liability mentioned here is to travel with them, then they need a very considerable run in period in order to manage that in a legally safe way, so as to ensure there are no questions about the entitlement to a pension that a staff member has accrued, and they estimate a minimum of 12 months notice as what was said to me, they may have a firmer figure that they can put on the table in conversations with the government.
But approximately 12 months clarity, and this amendment builds that clarity into the bill, and it's a very important consideration for staff. Whatever government's plans may may be. And I don't think there are any at the moment for the pensions of future staff of, of, of the railways, those who have in good faith accumulated an entitlement to date should not have it put at legal risk, even temporarily, by a botched and hasty transition. This seeks to prevent that from happening. Turning to amendment 305 B. There needs to be much greater clarity for similar reasons about the corporate and employer structure of Great British Railways, including where employees will sit and how these pension arrangements will work.
Further detail on the proposed structure and implementation timetable is vital if the government's commitments are to be delivered effectively in practice , and without clear and timely information, there is a greater risk to employee outcomes, effective governance and long term sustainability of pension arrangements. So I this is not the sort of amendment that even if we were on report, I would currently want to press. It is an amendment designed to elicit clear commitments from the Minister in committee at the despatch box that will satisfy Railpen and the beneficiaries of the pension schemes. Turning to amendment 306, the Minister in the other place said that the government have no plans to remove the Or from its role in train driver licensing and certification, but added that a future government might need to alter that.
Who performs that function ? Following changes to industry structures and responsibilities? Why? Why would any circumstance arise that would remove the power of licensing and certification from the or the independent safety regulator? We've been assured that although the position is being greatly diminished in some respects in regard to safety, its power and authority remains untouched and sacrosanct. So in what circumstances would the government imagine this coming about? This amendment is designed to ensure that they can't do that, but it gives the government, the minister, I should say, the noble Lord, an opportunity to explain why the government would want this power in the first place and to see if noble Lords would accept that explanation on amendments three, one, nine, three, 20 and 342.
These amendments go to the wider problem the government are creating for industrial relations on the railway. The first would restore minimum service levels during strike action. The government chose to repeal the strikes Minimum Service Levels Act through the Employment Rights Act 2025, removing the framework that was intended to protect a basic level of service for passengers during industrial action. As I've said already a moment ago, the risk of a national industrial strike is greatly enhanced by this legislation and the requirement that there should be appropriate thresholds for ballots to take place, and that there should be a minimum service level, as required by the previous legislation, seems the barest minimum the government should do in order to protect passengers and the travelling public.
Amendment 320 is on a work based work force productivity framework. It's also very important if Great British Railways is to deliver better value for taxpayers and passengers, and that must be one of its objectives. It is one of its objectives. It cannot simply absorb existing working practices without challenging whether they remain appropriate. And now that if they are in charge and there is one all singing Great British Railways and all dancing that should be set to music in a plan that can be scrutinised and challenged. So when you had multiple employers and the fragmentation that the minister so deplores, one can understand how it's difficult to draw all that together.
But one of the great advantages, if there are any advantages to GBR, is that it should be put to the challenge on exactly that question of how they are going to improve workforce productivity. It isn't enough to say leave it to us. We need a serious programme of workforce modernisation. Finally, on 318, this is not in my name, if I'm correct. But the noble my noble friend Lord Grayling, is unfortunately not able to be here for the early part of the committee. I believe he's going to join us later. This is an amendment in his name that he's asked me to mention, which I'm very pleased to do.
It concerns the training of staff in relation to railways, people working on the railways, people who might want to work on the railways in the future. And he proposes the merits of a national rail college. An academy doesn't necessarily have to be in one building in one place. Modern educational systems have more diversity to them than that. But a national railway is academy to help train and improve existing staff, but also to encourage newcomers and to create pathways, partly through apprentices, through, excuse me, apprenticeships, partly through graduate routes to encourage people coming on to the railway again, if there is any advantage in having Great British Railways as a single operator, it would be the possibility to take to move forward with bold ideas like that which can set a fresh path for the railways and encourage young people and give them hope and aspiration to work on the railways, which can, as I think we all know, be a very rewarding and enjoyable career.
My Lords, I beg to move.
We've seen very recently on Chiltern Railways, the RMT once again objecting to proposals for driver only operation on the new East West rail services, even though on other Chiltern Railway services, I appreciate Chiltern Railways has now had its franchise recently terminated. But on other Chiltern Railways services, driver only operation operates very satisfactorily. As an occasional customer of Chiltern Railways to Solihull and Birmingham. I'm very aware of that. I appreciate that. I'm not saying that's the only reason that the East West rail service is not operating, but it's been a significant point and. They argue that the arrangements are watered down safety because the second member of staff would necessarily perform a safety critical train manager role.
But Chiltern has confirmed that every East West rail service will still have two people on board. The driver and another colleague responsible for looking after passengers, checking tickets, assisting those who need help and dealing with issues on board. Chiltern has also made clear that it has operated most of its trains, as I say, but the driver controlling the doors for decades. And that brings me to the purpose of this amendment. If we are creating great British Railways, we should also be looking seriously, as I say, at how the railway can operate more efficiently. And I know the noble Lord would probably want to say that this is all a matter to be entrusted to Great British Railways once it's up and running, but it's a matter in which the public and Parliament, I think, have a very legitimate interest, and it would not be inappropriate to have something along these lines.
On the face of the Bill. We should not automatically preserve working practices simply because they have existed historically, particularly where technology and modern operating practices mean that they're no longer necessary. Driver only and driver controlled operation are hardly novel concepts. The independent safety regulator has previously concluded that with suitable equipment, proper procedures and competent staff in place, driver only operation can be a safe method of working. The current guidance similarly makes clear that driver controlled operation can meet legal safety requirements, where the proper systems and safeguards are in place. This amendment, therefore, establishes a clear presumption that the new , new, new GBR passenger services should operate on a driver only basis that would allow GBR to design new services around modern and efficient operating practices from the outset, rather than importing unnecessary staffing requirements into every new service.
And bear in mind, of course, that GBR will be much more vulnerable to industrial action in the future as, as has been discussed in other groups, there is an eventual drift, as I'm sure there will be if the unions get their way. The single to a single employment. Crucially, however, the amendment does have a safety override because it includes a provision in subsection three expressly giving the Orer the power to exempt a service from this requirement, where it is satisfied that driver only operation would create an unacceptable risk to the safe operation of the railway.
If Great British Railways is genuinely going to deliver a more efficient rail. It must have the ability to modernise the way in which new services are operated while maintaining the highest standards of safety. Turning to amendment 305 A and 305 B 305 A is about ensuring that as employees move into the new structure, existing employment liabilities move with them in an orderly and transparent way. Now, I can say to noble Lords that this amendment has been tabled by me at the urging of rail ten, which is the body that manages the Railways pension scheme. I'm sure they've made similar representations to the government, and I wish to hear how the government responds to them.
The. Nearly everybody who works on the railway has a pension scheme. There are multiple schemes, but they come under the umbrella of the same railway pension scheme, most of them, nearly all of them, and their management structure goes under the name of their management agent, goes under the name of Railpen. And they have explained very clearly that if there is to be a transition of staff and the pension, the liability mentioned here is to travel with them, then they need a very considerable run in period in order to manage that in a legally safe way, so as to ensure there are no questions about the entitlement to a pension that a staff member has accrued, and they estimate a minimum of 12 months notice as what was said to me, they may have a firmer figure that they can put on the table in conversations with the government.
But approximately 12 months clarity, and this amendment builds that clarity into the bill, and it's a very important consideration for staff. Whatever government's plans may may be. And I don't think there are any at the moment for the pensions of future staff of, of, of the railways, those who have in good faith accumulated an entitlement to date should not have it put at legal risk, even temporarily, by a botched and hasty transition. This seeks to prevent that from happening. Turning to amendment 305 B. There needs to be much greater clarity for similar reasons about the corporate and employer structure of Great British Railways, including where employees will sit and how these pension arrangements will work.
Further detail on the proposed structure and implementation timetable is vital if the government's commitments are to be delivered effectively in practice , and without clear and timely information, there is a greater risk to employee outcomes, effective governance and long term sustainability of pension arrangements. So I this is not the sort of amendment that even if we were on report, I would currently want to press. It is an amendment designed to elicit clear commitments from the Minister in committee at the despatch box that will satisfy Railpen and the beneficiaries of the pension schemes. Turning to amendment 306, the Minister in the other place said that the government have no plans to remove the Or from its role in train driver licensing and certification, but added that a future government might need to alter that.
Who performs that function ? Following changes to industry structures and responsibilities? Why? Why would any circumstance arise that would remove the power of licensing and certification from the or the independent safety regulator? We've been assured that although the position is being greatly diminished in some respects in regard to safety, its power and authority remains untouched and sacrosanct. So in what circumstances would the government imagine this coming about? This amendment is designed to ensure that they can't do that, but it gives the government, the minister, I should say, the noble Lord, an opportunity to explain why the government would want this power in the first place and to see if noble Lords would accept that explanation on amendments three, one, nine, three, 20 and 342.
These amendments go to the wider problem the government are creating for industrial relations on the railway. The first would restore minimum service levels during strike action. The government chose to repeal the strikes Minimum Service Levels Act through the Employment Rights Act 2025, removing the framework that was intended to protect a basic level of service for passengers during industrial action. As I've said already a moment ago, the risk of a national industrial strike is greatly enhanced by this legislation and the requirement that there should be appropriate thresholds for ballots to take place, and that there should be a minimum service level, as required by the previous legislation, seems the barest minimum the government should do in order to protect passengers and the travelling public.
Amendment 320 is on a work based work force productivity framework. It's also very important if Great British Railways is to deliver better value for taxpayers and passengers, and that must be one of its objectives. It is one of its objectives. It cannot simply absorb existing working practices without challenging whether they remain appropriate. And now that if they are in charge and there is one all singing Great British Railways and all dancing that should be set to music in a plan that can be scrutinised and challenged. So when you had multiple employers and the fragmentation that the minister so deplores, one can understand how it's difficult to draw all that together.
But one of the great advantages, if there are any advantages to GBR, is that it should be put to the challenge on exactly that question of how they are going to improve workforce productivity. It isn't enough to say leave it to us. We need a serious programme of workforce modernisation. Finally, on 318, this is not in my name, if I'm correct. But the noble my noble friend Lord Grayling, is unfortunately not able to be here for the early part of the committee. I believe he's going to join us later. This is an amendment in his name that he's asked me to mention, which I'm very pleased to do.
It concerns the training of staff in relation to railways, people working on the railways, people who might want to work on the railways in the future. And he proposes the merits of a national rail college. An academy doesn't necessarily have to be in one building in one place. Modern educational systems have more diversity to them than that. But a national railway is academy to help train and improve existing staff, but also to encourage newcomers and to create pathways, partly through apprentices, through, excuse me, apprenticeships, partly through graduate routes to encourage people coming on to the railway again, if there is any advantage in having Great British Railways as a single operator, it would be the possibility to take to move forward with bold ideas like that which can set a fresh path for the railways and encourage young people and give them hope and aspiration to work on the railways, which can, as I think we all know, be a very rewarding and enjoyable career.
My Lords, I beg to move.
16:28
16:28
Speaker 3
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Speaker 3
My Lords, I would like to speak to amendment 306 a. It seeks a commitment from the government to ensure that train companies bear the cost of training, licensing, certification of train drivers. The bill, in its present form, can enable the current or future Secretary of State to introduce fees for drivers receiving or renewing their licence and or a train driving certificate. This would create a financial barrier to increasing the supply of train drivers. A fee system for drivers could discourage job applications, especially from younger applicants, at a time when the government has lowered the train driving age to 18.
Given the shortage of drivers leading to the over reliance on overtime to keep the railway system running, and with the increased number of retirements in the very near future, there is no need to add any barriers to the process of recruiting new drivers. If GBR is proposed as the licence issuer, drivers working for employers outside of GBR in the freight open access or under devolved authorities could be forced to pay a fee to the infrastructure manager and operators of passenger services on top of their employer paying access charges. In a recent survey, which elicited 5000 responses, 94% of Aslef drivers opposed the introduction of fees for licensing and 95% did not support fees for certificates.
Majority said that they would have been less likely to apply for the job if they had to pay fees for their licence. This amendment seeks clarity and certainty. I suspect that the minister might respond by saying that the government has no intention to charge individuals. If so, then that should be clearly stated in the Bill and. And this should set a benchmark in case a future government is tempted to introduce personal fees. I'm well aware. I'm well aware that the current bill requires the government to consult with train drivers and others, but there is no stronger requirement to.
What we might say to have regard to. That is a phrase that used to have regard to. So after consultation, the views of train drivers and their representatives can actually be disregarded. That is not beyond the realms of possibilities. We all remember the minimum service levels legislation where in 2023 the government consulted, but despite opposition went ahead with the legislation anyway, it did not have what some people say have regard to views expressed subsequently. That legislation could not be implemented because it was simply impractical. So this amendment seeks certainty and clarity from the government. This amendment is asking Parliament to define who may be charged for licensing and certification.
The government states that it has no intention to charge any individual. It would be helpful for the Minister to confirm this by accepting this very modest amendment to the Bill. I beg to move.
Given the shortage of drivers leading to the over reliance on overtime to keep the railway system running, and with the increased number of retirements in the very near future, there is no need to add any barriers to the process of recruiting new drivers. If GBR is proposed as the licence issuer, drivers working for employers outside of GBR in the freight open access or under devolved authorities could be forced to pay a fee to the infrastructure manager and operators of passenger services on top of their employer paying access charges. In a recent survey, which elicited 5000 responses, 94% of Aslef drivers opposed the introduction of fees for licensing and 95% did not support fees for certificates.
Majority said that they would have been less likely to apply for the job if they had to pay fees for their licence. This amendment seeks clarity and certainty. I suspect that the minister might respond by saying that the government has no intention to charge individuals. If so, then that should be clearly stated in the Bill and. And this should set a benchmark in case a future government is tempted to introduce personal fees. I'm well aware. I'm well aware that the current bill requires the government to consult with train drivers and others, but there is no stronger requirement to.
What we might say to have regard to. That is a phrase that used to have regard to. So after consultation, the views of train drivers and their representatives can actually be disregarded. That is not beyond the realms of possibilities. We all remember the minimum service levels legislation where in 2023 the government consulted, but despite opposition went ahead with the legislation anyway, it did not have what some people say have regard to views expressed subsequently. That legislation could not be implemented because it was simply impractical. So this amendment seeks certainty and clarity from the government. This amendment is asking Parliament to define who may be charged for licensing and certification.
The government states that it has no intention to charge any individual. It would be helpful for the Minister to confirm this by accepting this very modest amendment to the Bill. I beg to move.
16:32
16:32
16:32
Speaker 4
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Speaker 4
The first time that I am a teacher in a state school and not sure if I have to declare, but I'm a an officer for apprenticeships, which has a bearing on this. My Lords, we are in a skills crisis. We no longer have to explain what NEETs stands for. We all know we've just had the Milburn report, and very much the zeitgeist is that we need to do something about it. My Lords, the armed forces are the biggest provider of apprenticeships in this country , and the army of the largest of that part. And the army have about 90,000 people working for them, which is about the same, I believe, as Great British Rail is going to be.
So I think you can see where we're going here. I would like Great British Railways to commit to become the largest provider of apprenticeships as a proportion of their workers. They are based around the country. The railways, when they were formed, were one of the biggest employers in the country. And I think it would be a perfect opportunity to work around the country with people like Skills England, with the local authorities, with the local skills improvement plans to provide a highly motivated, highly skilled, faithful workforce. And my Lords, I. I think the Prime Minister might like it as well.
So I think you can see where we're going here. I would like Great British Railways to commit to become the largest provider of apprenticeships as a proportion of their workers. They are based around the country. The railways, when they were formed, were one of the biggest employers in the country. And I think it would be a perfect opportunity to work around the country with people like Skills England, with the local authorities, with the local skills improvement plans to provide a highly motivated, highly skilled, faithful workforce. And my Lords, I. I think the Prime Minister might like it as well.
16:34
Speaker 5
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Speaker 5
My Lord, I want to speak to four of the amendments in this group, most of them relatively briefly on amendment 213, moved by my noble friend Lord Moylan. I would just add my support to that. He set out, I think, very clearly, the reasons for doing so. I would only add, I think it's a useful amendment because it effectively changes the the presumption, which I think is very helpful for GBR. It still allows the law to say that you need to not have driver only operation if there's a very good reason for doing so, but it means the default is that you would.
And and it comes back to actually a discussion we had the other day. If you're going to run a competitive railway and you're going to deliver it at a reasonable cost where you can not have staff doing jobs, which can be done in a more efficient way. The advantage of doing that is it then frees up the ability for GBR to deploy its staff in a way that better serves customers. And I would just briefly refer back to the discussion we had on Monday, when we were talking about the need to have more staff focused, particularly on supporting passengers with disabilities and other needs.
And there is only there are only so many people to go around. There is only so much cost that can be borne . And by delivering the. This driver only operation more efficiently, it enables GBR then to deploy staff to serving passengers. I think in the way that we wanted to see when we were discussing it on Monday. All I would add to Lord Moreland's amendment 305 a on pensions. It's not just important in getting this transition right to protect the rights and the financial benefits that employees have got. That is, of course, very important. And his amendment does that.
The second thing about having a proper transitional process is to make sure that the management of what is a large pension scheme is done efficiently. We've already seen, sadly, with the civil service pensions and the move from managing that from one provider to another, that if that's not well handled, employees, current employees either trying to find information about about their pensions or people who are retiring and needing that information get a very poor service. And if the pension scheme is forced to do a transitional process too quickly, not only does that put at risk the ensuring the financial rights of pensioners are protected, but also potentially delivers terrible customer service, which can actually be incredibly damaging for pensioners.
And I think making sure that's handled in a sensible and orderly way, I think is beneficial, both for GBR but also for its workforce, and there's no interest for anybody in having that not well handled on amendment 320 on workforce productivity. Again, my noble friend set it out very well. I would add my support to that. Again, we talked a lot about costs and who bears the cost of that, whether it's the taxpayer, the fare payer. But the important point is to reduce the cost of delivering rail services. So that actually whoever, however we split that cost, it's at the lowest possible cost to either taxpayer or fare payer.
And I think my noble friend sets out a very good scheme for doing so. The final point I wanted to say was just on amendment 333, which my noble friend Lord Hampton just talked to. I absolutely support the thrust of his amendment. I think if he were to bring it back at report, depending on what the minister says, I think the wording needs a bit tightening up because he said he wanted GBR to be the largest provider of apprenticeships as a proportion of its workforce, which isn't what the amendment currently says. And I support the first part of it, which is about increasing the number of apprenticeships.
I'm not sure having a target for GBR to be the biggest one is a very sensible thing to write into statute, but I think the thrust of his amendment, which is to have GBR become a very significant provider of apprenticeships across, importantly, the whole of their workforce. So not just on the what is the current Network Rail side? So on the engineering side and people delivering the infrastructure, but actually apprenticeships across the whole business, customer services, some of the back office operations in terms of finance and managing it. I think all of those provide really great jobs for people.
And I think training that workforce, the workforce is particularly. The drivers are. If you look at the. The noble Lord, Lord seeker, mentioned, a very significant number of them are getting towards retirement age and actually training a workforce. Making sure we have a workforce for the future is very valuable. And I commend that amendment to the committee. Thank you very much.
And and it comes back to actually a discussion we had the other day. If you're going to run a competitive railway and you're going to deliver it at a reasonable cost where you can not have staff doing jobs, which can be done in a more efficient way. The advantage of doing that is it then frees up the ability for GBR to deploy its staff in a way that better serves customers. And I would just briefly refer back to the discussion we had on Monday, when we were talking about the need to have more staff focused, particularly on supporting passengers with disabilities and other needs.
And there is only there are only so many people to go around. There is only so much cost that can be borne . And by delivering the. This driver only operation more efficiently, it enables GBR then to deploy staff to serving passengers. I think in the way that we wanted to see when we were discussing it on Monday. All I would add to Lord Moreland's amendment 305 a on pensions. It's not just important in getting this transition right to protect the rights and the financial benefits that employees have got. That is, of course, very important. And his amendment does that.
The second thing about having a proper transitional process is to make sure that the management of what is a large pension scheme is done efficiently. We've already seen, sadly, with the civil service pensions and the move from managing that from one provider to another, that if that's not well handled, employees, current employees either trying to find information about about their pensions or people who are retiring and needing that information get a very poor service. And if the pension scheme is forced to do a transitional process too quickly, not only does that put at risk the ensuring the financial rights of pensioners are protected, but also potentially delivers terrible customer service, which can actually be incredibly damaging for pensioners.
And I think making sure that's handled in a sensible and orderly way, I think is beneficial, both for GBR but also for its workforce, and there's no interest for anybody in having that not well handled on amendment 320 on workforce productivity. Again, my noble friend set it out very well. I would add my support to that. Again, we talked a lot about costs and who bears the cost of that, whether it's the taxpayer, the fare payer. But the important point is to reduce the cost of delivering rail services. So that actually whoever, however we split that cost, it's at the lowest possible cost to either taxpayer or fare payer.
And I think my noble friend sets out a very good scheme for doing so. The final point I wanted to say was just on amendment 333, which my noble friend Lord Hampton just talked to. I absolutely support the thrust of his amendment. I think if he were to bring it back at report, depending on what the minister says, I think the wording needs a bit tightening up because he said he wanted GBR to be the largest provider of apprenticeships as a proportion of its workforce, which isn't what the amendment currently says. And I support the first part of it, which is about increasing the number of apprenticeships.
I'm not sure having a target for GBR to be the biggest one is a very sensible thing to write into statute, but I think the thrust of his amendment, which is to have GBR become a very significant provider of apprenticeships across, importantly, the whole of their workforce. So not just on the what is the current Network Rail side? So on the engineering side and people delivering the infrastructure, but actually apprenticeships across the whole business, customer services, some of the back office operations in terms of finance and managing it. I think all of those provide really great jobs for people.
And I think training that workforce, the workforce is particularly. The drivers are. If you look at the. The noble Lord, Lord seeker, mentioned, a very significant number of them are getting towards retirement age and actually training a workforce. Making sure we have a workforce for the future is very valuable. And I commend that amendment to the committee. Thank you very much.
16:39
Speaker 6
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Speaker 6
My Lords. I have a couple of comments on this group of amendments. First one is on amendment 213 in the name of noble Lord, Lord Moylan. It's a very sensible amendment to the extent that we're sitting around with lots of passenger trains, sitting and sitting in sidings doing nothing. East West Rail comes to mind. Waterloo Station. There are several hundred trains there who've been there for a number of years, because there's no agreement on whether one, the driver is able to close the door or whether it needs to be somebody else. And of course, it's not anything that's particularly relevant to this this service.
It seems to have got caught in the caught up in the in the web of obfuscation. I'd like to I interested to know from my noble friend what arrangements are being made for the new TransPennine services and whether they will have a the driver to shut the door or they'll have a guard, or the driver will not shut the door, and. The guard will also do the very important duties elsewhere on the train. I'll be looking forward to hearing his comments on that. My Lord. The other two issues is on the on the amendment 319 on minimum service.
I think this is a really important one. Those of us who've studied the the goings on in France over the last few decades, not not at the moment, last few decades, one always came away from the impression that there was a strike, a railway strike happening somewhere in the country, which is probably true most of the time because most of the strikes were very small and and regional or local or local in application. But the one thing that the government and SNCF have done more recently is to require SNCF to run a minimum service on the main lines, even if the rest of their people are on strike.
And some of my family have got caught up in this in years past, and it's something like running one train in 3 or 1 train in four, which inconveniences many passengers. But it does mean that those who need to get around for some important reason, even if even if it's a delay, could do it. And I think that's something I hope my noble friend will look at this as an option for dealing with the. The worst effect of strikes if they if they ever happen. Finally, my Lord, the amendment 330 C enabled noble Lord, Lord Hampton on apprenticeship, which of course I fully support.
But I've been trying to encourage my people in Cornwall for firms in Cornwall, in the maritime sector , to take on more apprenticeships than. They've had many discussions with Skills England and they've taken on a number of apprenticeships, which is very good for the area. Skills England recently cancelled their apprenticeships and said there was no demand, and since there were several students already doing it, that does seem to be a bit odd. I'm in touch with with my colleagues, the minister, on this, but I do hope that in the in the apprenticeship seen in the railway sector that we take this extremely seriously in and try and cover the how much of the country as we can, because in the future we will need these people to replace some of the older members of the of the team.
It seems to have got caught in the caught up in the in the web of obfuscation. I'd like to I interested to know from my noble friend what arrangements are being made for the new TransPennine services and whether they will have a the driver to shut the door or they'll have a guard, or the driver will not shut the door, and. The guard will also do the very important duties elsewhere on the train. I'll be looking forward to hearing his comments on that. My Lord. The other two issues is on the on the amendment 319 on minimum service.
I think this is a really important one. Those of us who've studied the the goings on in France over the last few decades, not not at the moment, last few decades, one always came away from the impression that there was a strike, a railway strike happening somewhere in the country, which is probably true most of the time because most of the strikes were very small and and regional or local or local in application. But the one thing that the government and SNCF have done more recently is to require SNCF to run a minimum service on the main lines, even if the rest of their people are on strike.
And some of my family have got caught up in this in years past, and it's something like running one train in 3 or 1 train in four, which inconveniences many passengers. But it does mean that those who need to get around for some important reason, even if even if it's a delay, could do it. And I think that's something I hope my noble friend will look at this as an option for dealing with the. The worst effect of strikes if they if they ever happen. Finally, my Lord, the amendment 330 C enabled noble Lord, Lord Hampton on apprenticeship, which of course I fully support.
But I've been trying to encourage my people in Cornwall for firms in Cornwall, in the maritime sector , to take on more apprenticeships than. They've had many discussions with Skills England and they've taken on a number of apprenticeships, which is very good for the area. Skills England recently cancelled their apprenticeships and said there was no demand, and since there were several students already doing it, that does seem to be a bit odd. I'm in touch with with my colleagues, the minister, on this, but I do hope that in the in the apprenticeship seen in the railway sector that we take this extremely seriously in and try and cover the how much of the country as we can, because in the future we will need these people to replace some of the older members of the of the team.
16:44
Speaker 7
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Speaker 7
My Lords, my noble friend Lord Bradshaw is not able to be in his place today, but has asked me to speak to his amendment 308, which I've added my name to. This amendment is concerned with clause 94 of the bill. Most train drivers have a staff history which follows them as they move through the system, and it's updated as they qualify for different sorts of traction and rolling stock, and their route knowledge is also recorded and updated. This is the responsibility of the company employing them, and it works as it is. And Lord Bradshaw strongly feels it should not need to be altered.
The small number of drivers involved in running trains in France and beyond need licences, and that should be the responsibility of their employers. And these, of course, are mainly Eurostar, Eurotunnel and freight drivers. Lord Bradshaw is really concerned and can see no purpose in a central register containing details of drivers. He thinks this will create far more bureaucracy in the system, which he thinks it would be better to avoid. It would be interesting to hear the noble Lord the Minister's thoughts on that amendment regards to a couple of other amendments in this group. Amendment 330 C from Lord Hampton.
I fully support the idea of having far more apprenticeships on the railway. In fact, my father started his career with an apprenticeship on the railway, working in Eastleigh in Hampshire, and and qualified as a carpenter and joiner working on freight containers before moving on to a teaching career. So, you know, my family has a history of this, and I think it's something that's really important, particularly as we're finding young people are struggling to find careers in the current age. This is a way to really have high quality jobs, some of them very technical. And I would hope that Great British Railways will support that, as other big projects have, such as Crossrail in London and Lord Grayling's amendment on a National Rail Training and technology academy.
I think that's really interesting. We saw a tunneling academy developed as part of Crossrail, and we know there are many issues with driver training and shortages and using new technology in the railway, and I think that is a welcome suggestion from the noble Lord. I look forward to hearing the minister's response.
The small number of drivers involved in running trains in France and beyond need licences, and that should be the responsibility of their employers. And these, of course, are mainly Eurostar, Eurotunnel and freight drivers. Lord Bradshaw is really concerned and can see no purpose in a central register containing details of drivers. He thinks this will create far more bureaucracy in the system, which he thinks it would be better to avoid. It would be interesting to hear the noble Lord the Minister's thoughts on that amendment regards to a couple of other amendments in this group. Amendment 330 C from Lord Hampton.
I fully support the idea of having far more apprenticeships on the railway. In fact, my father started his career with an apprenticeship on the railway, working in Eastleigh in Hampshire, and and qualified as a carpenter and joiner working on freight containers before moving on to a teaching career. So, you know, my family has a history of this, and I think it's something that's really important, particularly as we're finding young people are struggling to find careers in the current age. This is a way to really have high quality jobs, some of them very technical. And I would hope that Great British Railways will support that, as other big projects have, such as Crossrail in London and Lord Grayling's amendment on a National Rail Training and technology academy.
I think that's really interesting. We saw a tunneling academy developed as part of Crossrail, and we know there are many issues with driver training and shortages and using new technology in the railway, and I think that is a welcome suggestion from the noble Lord. I look forward to hearing the minister's response.
16:46
16:47
16:47
Speaker 10
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Speaker 10
My Lords. May I begin with amendments 213 and 320 . A range of different staffing models for rail services are used across Britain's rail network by different train operators. Railway managers take many factors into account when deciding staffing levels such as passenger accessibility, the technological capability of the train and the infrastructure and on driver only operation in particular. Put simply, not all rolling stock, train services or routes are suitable for driver only operation. It's therefore not efficient or appropriate for primary legislation to determine how those and other trade offs should be resolved. Additionally, the new proposed new workforce framework set out by the noble Lord Moylan, suggests that changes suggests changes that could be a breach of an individual's contractual terms and conditions of employment.
Such matters are for the employer and the employees, through their trade unions, to negotiate under collective bargaining agreements. And turning to amendments three, one nine and 342 as as the noble Lord Moylan notes, the minimum service levels legislation was repealed by this government under the Employment Rights Act as it did not support a positive and productive relationship between employers, employees and their trade unions. In fact, it only served to exacerbate the national rail disputes under the last government, which saw two years of widespread strikes and disruptions to millions of passengers. And more to the point, it was unworkable because whilst while many rail employers had the opportunity to use minimum service level regulations, in fact none chose to do so.
Even those companies controlled at the time by the government that legislation, as they deemed it either unworkable or unnecessary. There is therefore no argument for including it here. Turning to 3305A305B and 317. I agree very much that it's in the interests of rail employees, employers and customers to ensure employee transfers are orderly, not least to limit the impact on rail operations and uses of the railway. Well established procedures and arrangements already exist to ensure this under existing Transfer of undertakings regulations employ employees transferring from one employer to another. Do so with appropriate protections for their existing contractual terms and conditions, which include protections for employees.
Occupational pension redundancy terms are also transfer scheme provisions. In the Bill of clauses 88 to 90 people, the government transfer staff on the same or similar terms as Tupe, and which must also comply with the Cabinet Office Statement of Principles, which again follows Tupe principles. Therefore, staff terms and conditions will be protected in transfers to GBR. On pensions. Specifically, pensions are not only protected by £0.02 principles, they are also protected through the existing legal and contractual framework governing the Railways Pension Scheme, which specifically protects accrued pensions. Tupe is established in the railways and no additional protection is needed as the minister makes up.
As Minister Mather previously stated on the floor of the House, in the other place, our intention is for the Railways Pension scheme to remain the main pension provision under GBR. We are in regular contact with the railway pension scheme. I have in fact met them myself and I believe the existing provisions are sufficient.
Such matters are for the employer and the employees, through their trade unions, to negotiate under collective bargaining agreements. And turning to amendments three, one nine and 342 as as the noble Lord Moylan notes, the minimum service levels legislation was repealed by this government under the Employment Rights Act as it did not support a positive and productive relationship between employers, employees and their trade unions. In fact, it only served to exacerbate the national rail disputes under the last government, which saw two years of widespread strikes and disruptions to millions of passengers. And more to the point, it was unworkable because whilst while many rail employers had the opportunity to use minimum service level regulations, in fact none chose to do so.
Even those companies controlled at the time by the government that legislation, as they deemed it either unworkable or unnecessary. There is therefore no argument for including it here. Turning to 3305A305B and 317. I agree very much that it's in the interests of rail employees, employers and customers to ensure employee transfers are orderly, not least to limit the impact on rail operations and uses of the railway. Well established procedures and arrangements already exist to ensure this under existing Transfer of undertakings regulations employ employees transferring from one employer to another. Do so with appropriate protections for their existing contractual terms and conditions, which include protections for employees.
Occupational pension redundancy terms are also transfer scheme provisions. In the Bill of clauses 88 to 90 people, the government transfer staff on the same or similar terms as Tupe, and which must also comply with the Cabinet Office Statement of Principles, which again follows Tupe principles. Therefore, staff terms and conditions will be protected in transfers to GBR. On pensions. Specifically, pensions are not only protected by £0.02 principles, they are also protected through the existing legal and contractual framework governing the Railways Pension Scheme, which specifically protects accrued pensions. Tupe is established in the railways and no additional protection is needed as the minister makes up.
As Minister Mather previously stated on the floor of the House, in the other place, our intention is for the Railways Pension scheme to remain the main pension provision under GBR. We are in regular contact with the railway pension scheme. I have in fact met them myself and I believe the existing provisions are sufficient.
16:50
Speaker 2
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Speaker 2
My Lord, I hesitate to interrupt because I have an opportunity to speak later on, but it might be helpful if I just say at this point. And pensions, the question is not about legal protection. The government the Minister has answered entirely in relation to the legal protection that exists for pensions. That wasn't the point at all. The point is the practicability of making the transfer of very large numbers of staff from one employer to another, the records that have to be changed and updated, the back office work, which is enormous in a pension scheme. Just think of the back office involved in a pension arrangement and the number of people involved.
Now, I don't understand. Of course, I don't expect to understand exactly how that works, but it's been represented to me with, in all seriousness, by those responsible for managing it, that they need a guarantee of adequate notice and they want to hear the government say 12 months was suggested that that notice will be given. It is not a question of legal protection, but of making sure people actually get the pension in the bank account from from the appropriate source on the day of the month on which it's due. Just think of the recent civil service.
Now, I don't understand. Of course, I don't expect to understand exactly how that works, but it's been represented to me with, in all seriousness, by those responsible for managing it, that they need a guarantee of adequate notice and they want to hear the government say 12 months was suggested that that notice will be given. It is not a question of legal protection, but of making sure people actually get the pension in the bank account from from the appropriate source on the day of the month on which it's due. Just think of the recent civil service.
16:52
Speaker 10
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Speaker 10
If I may say so. That's precisely why we're in regular contact with the railway pension scheme, and precisely why the any transfers that take place are managed in an orderly way, and I think that the dialogue that has been had. It's a very good pension scheme. It's well administered, and a dialogue that has been had is being had and will continue to be had, gives them, gives them sufficient notice and confidence. And and furthermore, we wouldn't dream of transferring large numbers of people if we didn't believe those administrative. Had within the period of time scale that we were proposing to do it.
16:52
Speaker 5
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Speaker 5
Just briefly before the minister moves on, he said that he is satisfied that the government's going to or has given the pension scheme sufficient notice. Can he just confirm on the record that the pension scheme and those that administrate it, have confirmed to him that they are satisfied that they've been given the appropriate amount of notice and are comfortable with the the ability to deliver what is required?
16:53
Speaker 10
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Speaker 10
Well, in answer to the noble Lord, I certainly believe so, but I'm very happy to go and check with them. As I said, we wouldn't dream of transferring any number of staff, whether it's large or small, without making sure that those arrangements could be properly carried out. And I think the scheme is well administered and is capable of doing everything we would want it to in the time scale that we're looking at, but I will confirm it with with regard to amendment 305 B, the government is committed to engaging transparently with employees while reform is implemented.
As I've already outlined, the transfer process will be subject to established GP consultation requirements, ensuring that staff and their representatives are informed and consulted in good time before any transfer scheme is made. Those discussions will take place over a number of months ahead of any transfer following familiar and when well understood , processes that helped ensure transfers of this significance are delivered in an orderly and effective manner. However, it really is extremely unusual for there to be a requirement in legislation that the entire corporate and employment structure be settled 12 months in advance, in order to use the power in question in a reform of the capacity those arrangements will necessarily involve, through consultation and negotiation with relevant stakeholders, and this requirement would remove a degree of flexibility for the Secretary of State to respond to any developments or adjust aspects of transfer or design in response to consultation, and risks locking the government into proposals before that process is complete.
That could ultimately delay the transfers themselves and the establishment of GBR, and I don't therefore consider a need for further legislation on on this matter. Turning to amendment 306, the amendment would require the Office of Rail and Road to issue both train driver licenses and train driver certificates. I should explain that under the current Train Driving Licences and Certificate Regulations 2010, licences are issued by the LRR , whilst certificates are issued by employers such as train operators. The reason for this is because the overall train driving licence issued by the Ori as a national level qualification.
But in comparison, the certification issued by employers is designed to demonstrate that drivers are competent to operate particular routes and particular rolling stock. It would not be appropriate to transfer the certification function to the LRR, as the employers are best placed to understand which services and trains drivers will be deployed on, and then to train them appropriately for that specific rolling stock. The order would not have the route and rolling stock level expertise to perform this function. Moreover, amendment 307 proposes specific consultation requirements. The existing drafting requires government to consult with representatives of train drivers and any other person deemed appropriate.
This enables a proportionate and flexible approach to consulting on a topic that involves significant technical and medical detail. I ask the government to consult people, for example , including medical professionals, if needed, but acknowledges that each time the power is used, a different set of consultees may be appropriate depending on the use of the power on amendment 306, I. I'd like to reassure my noble friend that there are no plans to change the existing train driver licensing and certification fee arrangements are not currently paid for by drivers, and that will not change. In fact, his amendment would prevent the status quo from staying as it is by as it as it is by making it so that only GBR and only GBR or train operators can pay fees in the regulations, whereas today the RR pays the licence fee, which is less than £10, which is then recruit through the Rail Safety Levy.
Employers currently only pay for the certification aspect of the fees, and I expect them to continue to do so. The power in clause 94 and the specific subsection is amending. He seeks to amend, does not create a targeted mechanism for introducing fees for drivers in obtaining their licences, including any training. The intention of this power is to allow the train driver licensing framework to evolve over time, as opposed to being frozen as it is currently. There are clear safeguards attached to the power, including mandatory consultation, impact assessments and parliamentary scrutiny, and I hope this provides my noble friend with reassurance he's looking for on amendment 308 from the noble Lord Bradshaw, spoken to by the noble Baroness Pidgeon.
The powers in clause 94 are critical if the government is to ensure that the framework for train driving remains robust, responsive and fit for purpose in the years ahead, they will allow the regime to evolve in line with the best practice, with best practice incorporating advances in technology, innovation, operations and safety knowledge. For instance, the legislation currently names the Ishihara test as one to be used by doctors when assessing color blindness. Despite there being more modern methods available to industry, which have arisen since the legislation was first made. For example, the Colour Assessment and Diagnosis Test, or the Farnsworth Dichotomous Test, which are more effective.
The ability to update this legislation on an enduring basis will help to modernise the framework and and support health and safety outcomes for drivers, as well as avoiding operational impacts such as train drivers being unable to be deployed on account of not passing outdated medical tests. That means it needs to cover both international and domestic operations, which clause 94 as drafted, will provide for. Turning to amendments 318, three, four, four and 330. See on amendment on the noble Lord Hampton's amendments. I would first say that the government and. And of course, I strongly support the intent behind this arrangement, and I hope noble Lords took note of last week's announcement that Great British Railways will create up to 600 new apprenticeships over the next four years, demonstrating our commitment to investing in the workforce of tomorrow.
These new Rail Foundation apprenticeships are possible thanks to the continuing work of Network Rail and DFT operator, together with Industry and Skills England , through the rail apprenticeship and Skills Funding and Skills Funding Industry Steering Group. This shows that apprenticeships will be an important part of building the skilled workforce that the railway needs now and in the future, and undoubtedly , Great British Railways needs to continue to play a significant role in supporting that ambition. It will have no option and there will be no diminution of demand if. If noble Lords look at the age distribution of current railway staff.
The government's focus on apprenticeships isn't new, however, and currently Network Rail trains between 800 and 1000 apprentices apprentices each year and the department funded passenger train operators trained around 2600 apprentices in 2020 425 I expect. I absolutely expect GBR to continue working closely with Skills England to support the development of the rail workforce and to help expand high quality apprenticeship opportunities across the sector in future. I hope that I've reassured the noble Lord that this is absolutely a key priority for the government , and therefore he can withdraw his amendment on amendments 318 and 300 and in our view, workforce development and technological innovation should be fully integrated with the strategic leadership of the railway.
We know skills and technology must be aligned with the wider priorities of the network, and it would be better to be done within the within GBR than be overseen by a separate statutory body. This matters because technology, operations and workforce skills are interdependent. For example, introducing new digital signalling requires not only investment in technology, but also changes the operational process and new ways of working for the workforce. If training were overseen separately, there would be a risk of developing skills programs that are not sufficiently aligned with wider, wider changes on the network. And that's why, under our reforms, GBR will bring together the functions needed to plan for the railways future.
We're particularly committed to ensuring that railway has a skilled workforce and technological capability it needs, and we're and we are already putting the structures in place to ensure GBR delivers this. For example, we're continuing to develop new routes into the industry, such as lowering the minimum train. Train driver age from 20 to 18 to encourage more people to choose the railway for their career path. By utilising GBR strategic reach, we will be able to build on this to identify future workforce requirements as part of its long term planning and business arrangements, and I don't think it makes sense to introduce fragmentation between the skilled workforce and the operations.
I hope my remarks have reassured noble Lords and enables them to withdraw their amendment.
As I've already outlined, the transfer process will be subject to established GP consultation requirements, ensuring that staff and their representatives are informed and consulted in good time before any transfer scheme is made. Those discussions will take place over a number of months ahead of any transfer following familiar and when well understood , processes that helped ensure transfers of this significance are delivered in an orderly and effective manner. However, it really is extremely unusual for there to be a requirement in legislation that the entire corporate and employment structure be settled 12 months in advance, in order to use the power in question in a reform of the capacity those arrangements will necessarily involve, through consultation and negotiation with relevant stakeholders, and this requirement would remove a degree of flexibility for the Secretary of State to respond to any developments or adjust aspects of transfer or design in response to consultation, and risks locking the government into proposals before that process is complete.
That could ultimately delay the transfers themselves and the establishment of GBR, and I don't therefore consider a need for further legislation on on this matter. Turning to amendment 306, the amendment would require the Office of Rail and Road to issue both train driver licenses and train driver certificates. I should explain that under the current Train Driving Licences and Certificate Regulations 2010, licences are issued by the LRR , whilst certificates are issued by employers such as train operators. The reason for this is because the overall train driving licence issued by the Ori as a national level qualification.
But in comparison, the certification issued by employers is designed to demonstrate that drivers are competent to operate particular routes and particular rolling stock. It would not be appropriate to transfer the certification function to the LRR, as the employers are best placed to understand which services and trains drivers will be deployed on, and then to train them appropriately for that specific rolling stock. The order would not have the route and rolling stock level expertise to perform this function. Moreover, amendment 307 proposes specific consultation requirements. The existing drafting requires government to consult with representatives of train drivers and any other person deemed appropriate.
This enables a proportionate and flexible approach to consulting on a topic that involves significant technical and medical detail. I ask the government to consult people, for example , including medical professionals, if needed, but acknowledges that each time the power is used, a different set of consultees may be appropriate depending on the use of the power on amendment 306, I. I'd like to reassure my noble friend that there are no plans to change the existing train driver licensing and certification fee arrangements are not currently paid for by drivers, and that will not change. In fact, his amendment would prevent the status quo from staying as it is by as it as it is by making it so that only GBR and only GBR or train operators can pay fees in the regulations, whereas today the RR pays the licence fee, which is less than £10, which is then recruit through the Rail Safety Levy.
Employers currently only pay for the certification aspect of the fees, and I expect them to continue to do so. The power in clause 94 and the specific subsection is amending. He seeks to amend, does not create a targeted mechanism for introducing fees for drivers in obtaining their licences, including any training. The intention of this power is to allow the train driver licensing framework to evolve over time, as opposed to being frozen as it is currently. There are clear safeguards attached to the power, including mandatory consultation, impact assessments and parliamentary scrutiny, and I hope this provides my noble friend with reassurance he's looking for on amendment 308 from the noble Lord Bradshaw, spoken to by the noble Baroness Pidgeon.
The powers in clause 94 are critical if the government is to ensure that the framework for train driving remains robust, responsive and fit for purpose in the years ahead, they will allow the regime to evolve in line with the best practice, with best practice incorporating advances in technology, innovation, operations and safety knowledge. For instance, the legislation currently names the Ishihara test as one to be used by doctors when assessing color blindness. Despite there being more modern methods available to industry, which have arisen since the legislation was first made. For example, the Colour Assessment and Diagnosis Test, or the Farnsworth Dichotomous Test, which are more effective.
The ability to update this legislation on an enduring basis will help to modernise the framework and and support health and safety outcomes for drivers, as well as avoiding operational impacts such as train drivers being unable to be deployed on account of not passing outdated medical tests. That means it needs to cover both international and domestic operations, which clause 94 as drafted, will provide for. Turning to amendments 318, three, four, four and 330. See on amendment on the noble Lord Hampton's amendments. I would first say that the government and. And of course, I strongly support the intent behind this arrangement, and I hope noble Lords took note of last week's announcement that Great British Railways will create up to 600 new apprenticeships over the next four years, demonstrating our commitment to investing in the workforce of tomorrow.
These new Rail Foundation apprenticeships are possible thanks to the continuing work of Network Rail and DFT operator, together with Industry and Skills England , through the rail apprenticeship and Skills Funding and Skills Funding Industry Steering Group. This shows that apprenticeships will be an important part of building the skilled workforce that the railway needs now and in the future, and undoubtedly , Great British Railways needs to continue to play a significant role in supporting that ambition. It will have no option and there will be no diminution of demand if. If noble Lords look at the age distribution of current railway staff.
The government's focus on apprenticeships isn't new, however, and currently Network Rail trains between 800 and 1000 apprentices apprentices each year and the department funded passenger train operators trained around 2600 apprentices in 2020 425 I expect. I absolutely expect GBR to continue working closely with Skills England to support the development of the rail workforce and to help expand high quality apprenticeship opportunities across the sector in future. I hope that I've reassured the noble Lord that this is absolutely a key priority for the government , and therefore he can withdraw his amendment on amendments 318 and 300 and in our view, workforce development and technological innovation should be fully integrated with the strategic leadership of the railway.
We know skills and technology must be aligned with the wider priorities of the network, and it would be better to be done within the within GBR than be overseen by a separate statutory body. This matters because technology, operations and workforce skills are interdependent. For example, introducing new digital signalling requires not only investment in technology, but also changes the operational process and new ways of working for the workforce. If training were overseen separately, there would be a risk of developing skills programs that are not sufficiently aligned with wider, wider changes on the network. And that's why, under our reforms, GBR will bring together the functions needed to plan for the railways future.
We're particularly committed to ensuring that railway has a skilled workforce and technological capability it needs, and we're and we are already putting the structures in place to ensure GBR delivers this. For example, we're continuing to develop new routes into the industry, such as lowering the minimum train. Train driver age from 20 to 18 to encourage more people to choose the railway for their career path. By utilising GBR strategic reach, we will be able to build on this to identify future workforce requirements as part of its long term planning and business arrangements, and I don't think it makes sense to introduce fragmentation between the skilled workforce and the operations.
I hope my remarks have reassured noble Lords and enables them to withdraw their amendment.
17:02
Speaker 2
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Speaker 2
My Lords, I'm not going to add further to the debate except to express disappointment at . In relation to the staffing matters, the general tenor of the government's position, which has been throughout. That we should not inquire because they can be trusted to manage it well, and I just don't think that works in the modern age. I think an organisation seeking the level of independence that Great British Rail is looking for needs to recognise that there will have to be mechanisms for scrutiny that involve Parliament that are simply not present adequately in this Bill, and I make that as a general comment.
It applies to a number of the areas that came up. My comments about pensions have been made, and I think it's very important. I look forward to reading what the minister writes to my noble friend Lord Harper, who has asked a very relevant question. I would only add to it this minister might wish to take note. It isn't simply the case of is are is the rail pension. Business hat rail pain? Is it happy now? Today? The question is will they be given adequate notice when transfers take place over a period as no doubt will be the case in the future.
So it's happy with the arrangements that exist for the future and the commitments given by the government of the future. That's what I think my noble friend was looking for, and I look forward to reading the response that the minister sends with that, with the leave of the House, I beg to withdraw my amendment.
It applies to a number of the areas that came up. My comments about pensions have been made, and I think it's very important. I look forward to reading what the minister writes to my noble friend Lord Harper, who has asked a very relevant question. I would only add to it this minister might wish to take note. It isn't simply the case of is are is the rail pension. Business hat rail pain? Is it happy now? Today? The question is will they be given adequate notice when transfers take place over a period as no doubt will be the case in the future.
So it's happy with the arrangements that exist for the future and the commitments given by the government of the future. That's what I think my noble friend was looking for, and I look forward to reading the response that the minister sends with that, with the leave of the House, I beg to withdraw my amendment.
17:04
Speaker 1
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Speaker 1
Is it your Lordship's pleasure that the amendment be withdrawn? It is by leave withdrawn. Amendment two one for Lord Holmes of Richmond, not moved and 215 and 216 also in the name of Lord Holmes of Richmond, not moved. We come to amendment 217 in the name of Baroness Brinton, not moved. Others in the name of Baroness Brinton, 218 219 and 220. Not moved. We turn then to 220 . A Baroness Grey-thompson not moved. There are a number of others. In the name of the Baroness. I suggest I read them out and it's 220BCDEFGHJKLMNPQRSG, all not moved, moved.
We then come to clause 59, amendment 221 in the name of Lord Moylan. Not not moved right. We come to amendment 222. Lord Parkinson of Whitley Bay.
We then come to clause 59, amendment 221 in the name of Lord Moylan. Not not moved right. We come to amendment 222. Lord Parkinson of Whitley Bay.
17:06
Speaker 11
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Speaker 11
My lords, the noble Lord, Lord Faulkner of Worcester and I have amendments 222 and 225 in this group. The first of these two, two, two would require Great British Railways to include provision for heritage rail operators in its access and use policy. As we turn our attention in committee to that access and use policy, noble Lords may think it eccentric that we start with the. The implications of these. For heritage rail, but this is an instance where the implications for them are much the same as for operators of other kinds, be they freight operators, open access operators, or those working in a devolved manner in regions across the UK.
It does so perhaps on a more granular and specific way. But there are a number of companies. As the noble Lord the minister knows well, who operate heritage charter services on the main line. Companies such as Vintage Trains, Lsn Locomotive Services Limited, West Coast Railways and Belmond, whose British Pullman. I had the pleasure of seeing speeding through Denmark Hill Station on Friday last week. All of these are an important part of the UK's soft power, as well as engines of our visitor economy. West coast railways . The Jacobite is known better in some quarters as the the Hogwarts Express from Harry Potter.
It draws tourists from around the world to come and see the Glenfinnan Viaduct, to visit the Scottish Highlands and the west coast of Scotland. They as well form memorable occasions for families of. Of all generations, forming the backdrop to significant birthdays, wedding anniversaries and much more. They are also an important recruiting sergeant for our railways, not just in making rail travel attractive and encouraging people to think about travelling by rail rather than road, but inspiring the next generation of engineers, drivers and and much more. And of course, these charter services are anchor attractions in the areas in which they operate, forming an important spur to hospitality and tourism businesses right across the United Kingdom.
Since 1993, they've operated on the basis of goodwill rather than a statutory guarantee. There is no mention of heritage charter services in the 1993 act. As the noble Lord, the minister knows, but the direction of travel, when that Act of Parliament was passed, is very different to the one we confront today. The whole thrust of the 93 act was to open the railways to a series of other operators and providers with common track and infrastructure infrastructure. Purpose here is to set up a a single controlling mind in Great British Railways and in some ways puts GBR in the intolerable position of having to decide on the allocation of capacity whilst being a major operator itself.
That is a concern not just for charter and heritage operators, but for many others. And in our amendment 225, the noble Lord, Lord Falconer of Worcester and I have set out some suggested criteria to try and make the decision making process of GBR a bit clearer, both for the sake of better decision making, but also to give some certainty and surety to other operators. We, for instance, think they should consider the period of time that a non GBR operator needs to promote their operation and to manage alterations. They should consider the impact of train cancellations and schedule variations.
The commercial interests of operators other than GBR, the enhancement of rail travel that other operators can bring and, and and much besides, there is some nervousness among heritage operators and other operators of all forms about the lack of certainty that set out in the Bill as as drafted. That's important for the complex routing and planning decisions that have to take place for these services to occur, but also for those who are booking and looking forward to journeys, particularly those centered on important occasions. Many of the companies, whilst commercial operations operate on tight margins, connected to charitable trusts who look after heritage locomotives and rolling stock, and therefore even minor alterations in decision making have significant implications for their businesses and their viability.
There are no checks and balances written into the bill, and there's an opportunity for the committee, as we look at this, to decide whether Parliament ought to set these out more clearly on the face of the Bill, and as we've touched on in other areas, if we are passing legislation now which lasts as long as the 1993 act does, whilst the noble Lord, the minister has a strong reputation for his protection, for his championing of and his affection for railway heritage, we want to ensure that the regime that we are bringing about stands the test of time under future ministers and future governments too.
So heritage operators like, like others, believe the starting point should be a right of access, which might then be subject to operational conditions and decisions. This, I should say, affects not just those who are operating charter services on the main line, but has implications for those who operate on a mixture of preserved and main lines. For instance, the North Yorkshire Moors Railway, the North Norfolk Railway, the Swanage Railway and others. And for those who rely on the main line in order to move Russian locomotives and others around the country for galas and and to reach preserved lines in different parts of the country.
The current model for heritage and charter operations on the national network does generally work well at the moment, but it is dependent on the right people in the right places within Network Rail and in government, who want to make it happen and often move heaven and earth to ensure that it does. This bill and the access and use policy is an opportunity to ensure that this vital part of our heritage railway landscape, and indeed other operators who rely on our railways, have a firmer and more certain footing in the generations to come. I beg to move.
It does so perhaps on a more granular and specific way. But there are a number of companies. As the noble Lord the minister knows well, who operate heritage charter services on the main line. Companies such as Vintage Trains, Lsn Locomotive Services Limited, West Coast Railways and Belmond, whose British Pullman. I had the pleasure of seeing speeding through Denmark Hill Station on Friday last week. All of these are an important part of the UK's soft power, as well as engines of our visitor economy. West coast railways . The Jacobite is known better in some quarters as the the Hogwarts Express from Harry Potter.
It draws tourists from around the world to come and see the Glenfinnan Viaduct, to visit the Scottish Highlands and the west coast of Scotland. They as well form memorable occasions for families of. Of all generations, forming the backdrop to significant birthdays, wedding anniversaries and much more. They are also an important recruiting sergeant for our railways, not just in making rail travel attractive and encouraging people to think about travelling by rail rather than road, but inspiring the next generation of engineers, drivers and and much more. And of course, these charter services are anchor attractions in the areas in which they operate, forming an important spur to hospitality and tourism businesses right across the United Kingdom.
Since 1993, they've operated on the basis of goodwill rather than a statutory guarantee. There is no mention of heritage charter services in the 1993 act. As the noble Lord, the minister knows, but the direction of travel, when that Act of Parliament was passed, is very different to the one we confront today. The whole thrust of the 93 act was to open the railways to a series of other operators and providers with common track and infrastructure infrastructure. Purpose here is to set up a a single controlling mind in Great British Railways and in some ways puts GBR in the intolerable position of having to decide on the allocation of capacity whilst being a major operator itself.
That is a concern not just for charter and heritage operators, but for many others. And in our amendment 225, the noble Lord, Lord Falconer of Worcester and I have set out some suggested criteria to try and make the decision making process of GBR a bit clearer, both for the sake of better decision making, but also to give some certainty and surety to other operators. We, for instance, think they should consider the period of time that a non GBR operator needs to promote their operation and to manage alterations. They should consider the impact of train cancellations and schedule variations.
The commercial interests of operators other than GBR, the enhancement of rail travel that other operators can bring and, and and much besides, there is some nervousness among heritage operators and other operators of all forms about the lack of certainty that set out in the Bill as as drafted. That's important for the complex routing and planning decisions that have to take place for these services to occur, but also for those who are booking and looking forward to journeys, particularly those centered on important occasions. Many of the companies, whilst commercial operations operate on tight margins, connected to charitable trusts who look after heritage locomotives and rolling stock, and therefore even minor alterations in decision making have significant implications for their businesses and their viability.
There are no checks and balances written into the bill, and there's an opportunity for the committee, as we look at this, to decide whether Parliament ought to set these out more clearly on the face of the Bill, and as we've touched on in other areas, if we are passing legislation now which lasts as long as the 1993 act does, whilst the noble Lord, the minister has a strong reputation for his protection, for his championing of and his affection for railway heritage, we want to ensure that the regime that we are bringing about stands the test of time under future ministers and future governments too.
So heritage operators like, like others, believe the starting point should be a right of access, which might then be subject to operational conditions and decisions. This, I should say, affects not just those who are operating charter services on the main line, but has implications for those who operate on a mixture of preserved and main lines. For instance, the North Yorkshire Moors Railway, the North Norfolk Railway, the Swanage Railway and others. And for those who rely on the main line in order to move Russian locomotives and others around the country for galas and and to reach preserved lines in different parts of the country.
The current model for heritage and charter operations on the national network does generally work well at the moment, but it is dependent on the right people in the right places within Network Rail and in government, who want to make it happen and often move heaven and earth to ensure that it does. This bill and the access and use policy is an opportunity to ensure that this vital part of our heritage railway landscape, and indeed other operators who rely on our railways, have a firmer and more certain footing in the generations to come. I beg to move.
17:13
17:13
17:13
17:13
Speaker 11
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Speaker 11
Are you going to say very briefly, the Committee will be relieved to know that I am not going to follow Lord Parkinson's speech with another defence of the Heritage Railway movement. He has put the case extraordinarily succinctly and clearly, and I hope that judging from the conversations that he and I have had with my friend the minister, he will get reassurances at the end of this debate. I do have a speech I want to make about access agreements on clause 60, and we will be coming to that in a moment.
17:13
Speaker 2
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Speaker 2
My Lords, with the leave of the chair and the committee, I hope it would help the committee if I set out some of the government's intentions on access at the outset. A few noble Lords have suggested to me that it might be helpful for me to explain some specific points, and if the Committee is happy to hear me, I will continue.
17:14
17:14
Speaker 2
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Speaker 2
Yeah, we're reforming the access regime because the current system is demonstrably broken. There are far too many parties involved with nobody in overall charge. The RR takes decisions on access. Network rail must then produce a timetable that's consistent with the access rights that have been granted by the order, and train operators must then run the timetables that Network Rail has produced. This is the system that gave us the notorious O 700 Manchester Piccadilly to Euston Ghost Train, which was set to run fully staffed but without any passengers. The disastrous May 2018 timetable, failure and years of delay to timetable improvements on the East Coast Main Line decade and and and further decades of anaemic growth in rail freight.
So the point of these reforms is to bring together all these different decisions into one place, a single directing mind, which is Great British Railways. To help the committee's debates on these clauses, I'd just like to briefly outline a few key components of the new system and how they fit together. Firstly, the access and use policy, which will set out Gbr's overall approach, how it will make decisions about who gets at work. GBR must have regard to the statutory duties set out in the Bill when it prepares and finalises this policy, and the draft policy published by Network Rail for consultation.
How the statutory duties will be reflected in Gbr's decision making. I've already heard from industry how positive the engagement has been throughout the draft access and use policies , development genuinely taken on board views, and I'm also pleased to hear that the Access and Use Policy draft has reassured many with its transparent and robust processes, where there are sufficient significant changes, but also a commitment to keep those parts of the current system that work. Secondly, the infrastructure capacity plan at call 60. This will set out Gbr's assessment of best use of the network. How much capacity on different parts of the network should be allocated, different allocated to different categories of use such as GBR passenger services, other public passenger services including devolved services, private passenger services including open access, heritage and charter services and freight services.
The ICP is crucial because it will provide a coherent overall view of how to make best use of the network conspicuously absent from the current system, and it will guide GBR when it decides on individual access applications from specific operators. More broadly, the long term planning work that GBR will do to inform the infrastructure capacity plan will also support long term improvements. That's because it will. It will enable GBR to understand where to prioritise enhancements, rolling stock and signalling interventions to best achieve its performance, public interest and freight growth objectives. It can reflect this thinking in its business plan so that for the first time in decades, there will be a funded plan based on a whole system view of the network.
GBR must be fair and even handed when it allocates capacity in the infrastructure capacity plan. Clause 60 is deliberately explicit that GBR must consider the need to accommodate other operators, passenger services and freight services, as well as as well as its own. The statutory duties in clause 18 will also apply to GBR in full when it develops and decides upon the infrastructure capacity plan. The capacity duty at clause 63 does not apply at this stage. This is clear from the clause, which sets out the specific limited circumstances in which it does apply. So to reiterate, the infrastructure capacity Plan is the stage at which GBR will make the key decisions about how much capacity should be allocated to freight, open access and other non GBR services.
And at this point, as I've said, the duties in clause 18 apply in full. That means that GBR cannot use the capacity duty as a reason to prioritise its own services in the ICP at the expense of freight or other passenger operators. If GBR did use the capacity duty at clause 63 in this way, I would expect an appeal to be upheld. The capacity duty applies later in the process. The noble Lord Lansley has asked why it's necessary to disapply the clause 18 duties entirely when the capacity duty applies. This ensures that those duties cannot be used by GBR as an excuse not to provide the services for which it's been funded.
It is important to disapply all these duties, because I might seek to argue that running fewer services than they're funded for would support their duty to improve reliability, or their duty to reduce the impact that the provision of its services has on the environment, or the duty to reduce the cost that will need to be met from public funds. Also on the capacity duties, some noble Lords have questioned whether clause 63 really makes a link to taxpayer funding. As I've outlined. I'm happy to explain that this is achieved by clause 63 referring to GBR passenger services.
The definition of that phrase later in the bill refers to the public service contract between the Secretary of State and GBR. This contract is where the Secretary of State will confirm the services that she requires GBR to operate using the taxpayer funding that's provided. So clause 63 is indeed is indeed requiring GBR to retain sufficient. Taxpayer funded it for. I can also reassure the noble Lord George Young about the reference in clause 63 to services that GBR quote expects will in future be GBR passenger services. This language does not allow GBR excuse me to retain capacity for services that it only has some vague notion that it might think about operating in the future.
These words in clause 63 are carefully chosen. They mean GBR must have a clear and genuine expectation that the Secretary of State will wish to secure and fund those services through the public service contract in future. For example, assumptions about those services might be contained within the approved business plan. I've been asked to clarify whether an aggrieved party can take a competition claim to the Competition and Markets Authority. First of all, the CMA and the Orer, both public enforcement authorities of competition law. I can confirm that they may carry out investigations, both in response to complaints and third parties, and of their own arrangements in place for deciding which of them will consider any particular issue or complaint.
Should either of these authorities establish that an infringement has occurred? Individuals may seek damages through what's called a follow on action, as well as having the opportunity to take a complaint to either.
So the point of these reforms is to bring together all these different decisions into one place, a single directing mind, which is Great British Railways. To help the committee's debates on these clauses, I'd just like to briefly outline a few key components of the new system and how they fit together. Firstly, the access and use policy, which will set out Gbr's overall approach, how it will make decisions about who gets at work. GBR must have regard to the statutory duties set out in the Bill when it prepares and finalises this policy, and the draft policy published by Network Rail for consultation.
How the statutory duties will be reflected in Gbr's decision making. I've already heard from industry how positive the engagement has been throughout the draft access and use policies , development genuinely taken on board views, and I'm also pleased to hear that the Access and Use Policy draft has reassured many with its transparent and robust processes, where there are sufficient significant changes, but also a commitment to keep those parts of the current system that work. Secondly, the infrastructure capacity plan at call 60. This will set out Gbr's assessment of best use of the network. How much capacity on different parts of the network should be allocated, different allocated to different categories of use such as GBR passenger services, other public passenger services including devolved services, private passenger services including open access, heritage and charter services and freight services.
The ICP is crucial because it will provide a coherent overall view of how to make best use of the network conspicuously absent from the current system, and it will guide GBR when it decides on individual access applications from specific operators. More broadly, the long term planning work that GBR will do to inform the infrastructure capacity plan will also support long term improvements. That's because it will. It will enable GBR to understand where to prioritise enhancements, rolling stock and signalling interventions to best achieve its performance, public interest and freight growth objectives. It can reflect this thinking in its business plan so that for the first time in decades, there will be a funded plan based on a whole system view of the network.
GBR must be fair and even handed when it allocates capacity in the infrastructure capacity plan. Clause 60 is deliberately explicit that GBR must consider the need to accommodate other operators, passenger services and freight services, as well as as well as its own. The statutory duties in clause 18 will also apply to GBR in full when it develops and decides upon the infrastructure capacity plan. The capacity duty at clause 63 does not apply at this stage. This is clear from the clause, which sets out the specific limited circumstances in which it does apply. So to reiterate, the infrastructure capacity Plan is the stage at which GBR will make the key decisions about how much capacity should be allocated to freight, open access and other non GBR services.
And at this point, as I've said, the duties in clause 18 apply in full. That means that GBR cannot use the capacity duty as a reason to prioritise its own services in the ICP at the expense of freight or other passenger operators. If GBR did use the capacity duty at clause 63 in this way, I would expect an appeal to be upheld. The capacity duty applies later in the process. The noble Lord Lansley has asked why it's necessary to disapply the clause 18 duties entirely when the capacity duty applies. This ensures that those duties cannot be used by GBR as an excuse not to provide the services for which it's been funded.
It is important to disapply all these duties, because I might seek to argue that running fewer services than they're funded for would support their duty to improve reliability, or their duty to reduce the impact that the provision of its services has on the environment, or the duty to reduce the cost that will need to be met from public funds. Also on the capacity duties, some noble Lords have questioned whether clause 63 really makes a link to taxpayer funding. As I've outlined. I'm happy to explain that this is achieved by clause 63 referring to GBR passenger services.
The definition of that phrase later in the bill refers to the public service contract between the Secretary of State and GBR. This contract is where the Secretary of State will confirm the services that she requires GBR to operate using the taxpayer funding that's provided. So clause 63 is indeed is indeed requiring GBR to retain sufficient. Taxpayer funded it for. I can also reassure the noble Lord George Young about the reference in clause 63 to services that GBR quote expects will in future be GBR passenger services. This language does not allow GBR excuse me to retain capacity for services that it only has some vague notion that it might think about operating in the future.
These words in clause 63 are carefully chosen. They mean GBR must have a clear and genuine expectation that the Secretary of State will wish to secure and fund those services through the public service contract in future. For example, assumptions about those services might be contained within the approved business plan. I've been asked to clarify whether an aggrieved party can take a competition claim to the Competition and Markets Authority. First of all, the CMA and the Orer, both public enforcement authorities of competition law. I can confirm that they may carry out investigations, both in response to complaints and third parties, and of their own arrangements in place for deciding which of them will consider any particular issue or complaint.
Should either of these authorities establish that an infringement has occurred? Individuals may seek damages through what's called a follow on action, as well as having the opportunity to take a complaint to either.
17:21
17:21
Speaker 2
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Speaker 2
It's also open to a complaint to bring private legal proceedings themselves through the courts. My Lords, I apologise for having spoken at some length, but I hope these remarks have been helpful in providing some clarity for the next few groups of amendments in detail, and I thank the Committee for its patience.
17:21
Speaker 12
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Speaker 12
My Lords, firstly, can I thank the Minister for the meeting that we held last week where some of the issues that he has just informed the committee about the government's intentions were the subject of our discussion, I think, rather helpful that he's set it out in the way that he has. I think it provides a degree of reassurance. I want to just explain in this group the purpose of my amendment 224, which, notwithstanding what the minister said, I think still is a relevant question to ask in this group. But I fear what the minister has said leads me to think that it might be sensible, just to refer to my clause 63 stand part relating to the capacity duty at this point in this group, and then I don't have to repeat it again in the next group.
So from from my point of view, clause 59, we understand what it's intended to do. The minister has explained, and it's intended to back up the establishment of an access and use policy. We've seen a draft of that from Network Rail, which would be one that would be the basis on which GBR would, in due course, set out its access and use policy. From my point of view, I think I tabled amendment two, two, four before we saw that draft, but I did have a look at what it is that's in the consultation draft. And it doesn't do precisely what, of course, set the 2016 regulations presently do, which is in particular in in regulation five, one of the 2016 regulations, which I'll just quote for the purpose.
So they're on the record. It says five. One says a railway undertaking must be granted on equitable, non-discriminatory and transparent conditions. Access rights to such railway infrastructure as may be necessary for the purpose of operating all types of rail, freight or international passenger services. Now, the point I think the committee will be aware is that this is a statutory entitlement to access rights that is granted under the existing 2016 regulations. That that's what takes us to the interaction between clause 59, which gives the basis for an access and use policy, and clause is 60 and 6360, sets up the infrastructure capacity plan , and through establishing what is the best use of that infrastructure capacity, resolves the conflicts of interest between the relative users of that , that whole infrastructure.
So what is dispensed with in that process is the statutory entitlement to access rights, because they are intended to be taken into account in the infrastructure capacity plan under clause 60. So from my point of view, in amendment two, two, four, I am not setting out in the in the amendment, the statutory entitlement. Okay. So I hope the minister understands that that's not the purpose. The purpose of amendment two, two, four is to say , when under clause 59, the access and use policy is establishing what criteria should be applied by Great British Railways. One of the things that should be included is the substantive criteria that it should be equitable, non-discriminatory and transparent.
And I'm not sure, looking at the consultation draft that we have at the moment from Network Rail, that it sets out those criteria in the way that we would want it to. So this is a probing amendment. Of course, the purpose at this stage is to try and see how that is going to be delivered in the future, and maybe at report will return to it, and perhaps the minister will be able to give us some reassurance that that will be taken on board in the consultation that is yet to conclude, and might be something that is taken on board.
The point about clause 63, and I can say it now to save repeating it in the next group, is that I was always worried. I approached it and saw it as something that allowed the GBR, when thinking about its requirement to provide passenger services or to provide future passenger services, could dispense with the need to accommodate other competing uses of the infrastructure capacity. Interestingly, I was looking at it, as it were, as a bottle half empty, and the government is looking at it a bottle half full. What they mean by it is great British Railways is entering into agreements with the Secretary of State, a Scottish and Welsh Ministers to provide passenger services, etc.
and it must fulfil that capacity, duty and exercise its decision making under clause 60 in order to satisfy those requirements. Now, the point that the Minister has just made, which I think is to be fair to him, reiterating something that is to be found in the explanatory notes. In any case, because the explanatory notes make it very clear at paragraph 169. I quote the duty that is, the capacity. Duty does not. And clause 63 does not enable Great British Railways to secure more capacity for its own services than it thinks would equate to best use.
So we should be reassured that it is not a threat to freight or open. So I think that's the best use. Finish quotes. So from my point of view, the minister is reiterating and I hope, reassuring us in what he said about an expectation that there would be the Secretary of State would not support the concept that the capacity duty under clause 63 should be used for self-preferencing GBR relative to competing uses of the capacity. And as he said, the Competition and Markets Authority or the order as a concurrent competition authority, could have a good look at Self-preferencing and act against it if it saw it.
So I think that's quite a degree of reassurance. I have to say. We may return to the question of to what extent does the application of the capacity duty in clause 63 justify the disapplication of general duties on such things as the public interest or the. Or the effective use of public funds? Since I think there are no circumstances in which those general duties should be disapplied. But for these purposes I won't speak again to the clause 63 stamp part on the next group, but I just wanted to draw attention to the fact that amendment two, two, four is just making the point that these are important criteria equitable, non-discriminatory , and transparent conditions, and they are not reflected in the draft that we've seen now.
And I think they should be carried forward from the 2016 regulations in that way.
So from from my point of view, clause 59, we understand what it's intended to do. The minister has explained, and it's intended to back up the establishment of an access and use policy. We've seen a draft of that from Network Rail, which would be one that would be the basis on which GBR would, in due course, set out its access and use policy. From my point of view, I think I tabled amendment two, two, four before we saw that draft, but I did have a look at what it is that's in the consultation draft. And it doesn't do precisely what, of course, set the 2016 regulations presently do, which is in particular in in regulation five, one of the 2016 regulations, which I'll just quote for the purpose.
So they're on the record. It says five. One says a railway undertaking must be granted on equitable, non-discriminatory and transparent conditions. Access rights to such railway infrastructure as may be necessary for the purpose of operating all types of rail, freight or international passenger services. Now, the point I think the committee will be aware is that this is a statutory entitlement to access rights that is granted under the existing 2016 regulations. That that's what takes us to the interaction between clause 59, which gives the basis for an access and use policy, and clause is 60 and 6360, sets up the infrastructure capacity plan , and through establishing what is the best use of that infrastructure capacity, resolves the conflicts of interest between the relative users of that , that whole infrastructure.
So what is dispensed with in that process is the statutory entitlement to access rights, because they are intended to be taken into account in the infrastructure capacity plan under clause 60. So from my point of view, in amendment two, two, four, I am not setting out in the in the amendment, the statutory entitlement. Okay. So I hope the minister understands that that's not the purpose. The purpose of amendment two, two, four is to say , when under clause 59, the access and use policy is establishing what criteria should be applied by Great British Railways. One of the things that should be included is the substantive criteria that it should be equitable, non-discriminatory and transparent.
And I'm not sure, looking at the consultation draft that we have at the moment from Network Rail, that it sets out those criteria in the way that we would want it to. So this is a probing amendment. Of course, the purpose at this stage is to try and see how that is going to be delivered in the future, and maybe at report will return to it, and perhaps the minister will be able to give us some reassurance that that will be taken on board in the consultation that is yet to conclude, and might be something that is taken on board.
The point about clause 63, and I can say it now to save repeating it in the next group, is that I was always worried. I approached it and saw it as something that allowed the GBR, when thinking about its requirement to provide passenger services or to provide future passenger services, could dispense with the need to accommodate other competing uses of the infrastructure capacity. Interestingly, I was looking at it, as it were, as a bottle half empty, and the government is looking at it a bottle half full. What they mean by it is great British Railways is entering into agreements with the Secretary of State, a Scottish and Welsh Ministers to provide passenger services, etc.
and it must fulfil that capacity, duty and exercise its decision making under clause 60 in order to satisfy those requirements. Now, the point that the Minister has just made, which I think is to be fair to him, reiterating something that is to be found in the explanatory notes. In any case, because the explanatory notes make it very clear at paragraph 169. I quote the duty that is, the capacity. Duty does not. And clause 63 does not enable Great British Railways to secure more capacity for its own services than it thinks would equate to best use.
So we should be reassured that it is not a threat to freight or open. So I think that's the best use. Finish quotes. So from my point of view, the minister is reiterating and I hope, reassuring us in what he said about an expectation that there would be the Secretary of State would not support the concept that the capacity duty under clause 63 should be used for self-preferencing GBR relative to competing uses of the capacity. And as he said, the Competition and Markets Authority or the order as a concurrent competition authority, could have a good look at Self-preferencing and act against it if it saw it.
So I think that's quite a degree of reassurance. I have to say. We may return to the question of to what extent does the application of the capacity duty in clause 63 justify the disapplication of general duties on such things as the public interest or the. Or the effective use of public funds? Since I think there are no circumstances in which those general duties should be disapplied. But for these purposes I won't speak again to the clause 63 stamp part on the next group, but I just wanted to draw attention to the fact that amendment two, two, four is just making the point that these are important criteria equitable, non-discriminatory , and transparent conditions, and they are not reflected in the draft that we've seen now.
And I think they should be carried forward from the 2016 regulations in that way.
17:28
Speaker 13
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Speaker 13
I want to follow Lord Lansley's point and refer to clause 63, which the nobleman, the noble Lord the minister touched on in his opening remarks, and like Lord Lansdowne, I had a very helpful meeting with the minister and his officials last week, which to some extent allayed my concern at what my noble friend Lord Lansley has done is reveal one of the tensions behind this bill, and the risk is that the monopoly owner of the infrastructure, namely GBR, will prefer its own passenger train services to others because of its ownership of the infrastructure. And what the minister has sought to do is to reassure us that that abuse cannot take place.
And the concern that I had, which I which in one sense he's addressed. But in another case he hasn't, was 632, which says this great British Railways must must exercise the function so as to ensure that it retains sufficient capacity over GBR infrastructure to allow for the operation of GBR passenger service and a rail passenger services that it expects will. In future, GBR will be GBR passenger services. Now that is a must and that, I think, overrides the general duty in paragraph. Is it 60 that it must use the. Ensure that the infrastructure is used to its.
Its best potential. Now in the meeting that I had with ministers, officials sought to reassure me by saying that what I've just read out was qualified by a subsequent definition of passenger services in, I think, paragraph 73. And what paragraph 73 says is this GBR passenger service means a railway passenger service provided by Great British Railways or a subsidiary of Great British Railways. Under arrangements made under section four or under a public service contract awarded under section 31. Now, that's a much tighter definition than the definition that the minister gave when he spoke, when he said that they could exercise that power in 63, as long as there was a clear and genuine expectation that they would provide the service.
Or I think he also mentioned that it was an approved business plan. Now that is that is, as I read it, looser than what is in 73, where there actually has to be a contract awarded by GBR before that exemption can be applied. So be hopeful when the minister speaks again, and I think he has his own amendment somewhere in this group, if he could just clarify which of the definitions of passenger services is right, the 1 in 73 or the one that he read out at the beginning? And just as a final word on this, the the letter that the minister sent me on March the 25th said that we intend the order will remain as competition regulator for the rail sector.
This means that any party that feels GBR is acting in a way that is in breach of competition law may raise concerns with the order. Now, the trouble with that is the Bill severely constrains the powers of the. If one looks at the briefing that we were sent. The executive summary says a reduced role for order in relation to access and use of the network. So perhaps the Minister confirmed that, notwithstanding anything in the Bill, notwithstanding the constraints that I've just read out on order, the CMA has a total freedom unconstrained by anything in the Bill, to challenge a decision made by GBR to award or to not to award a franchise to an open access operator if it feels there has been a general breach of competition law, notwithstanding anything that is in this bill, if the minister could put that assurance on the record, it would be of enormous help, not just to me, but also to open access operators.
And the concern that I had, which I which in one sense he's addressed. But in another case he hasn't, was 632, which says this great British Railways must must exercise the function so as to ensure that it retains sufficient capacity over GBR infrastructure to allow for the operation of GBR passenger service and a rail passenger services that it expects will. In future, GBR will be GBR passenger services. Now that is a must and that, I think, overrides the general duty in paragraph. Is it 60 that it must use the. Ensure that the infrastructure is used to its.
Its best potential. Now in the meeting that I had with ministers, officials sought to reassure me by saying that what I've just read out was qualified by a subsequent definition of passenger services in, I think, paragraph 73. And what paragraph 73 says is this GBR passenger service means a railway passenger service provided by Great British Railways or a subsidiary of Great British Railways. Under arrangements made under section four or under a public service contract awarded under section 31. Now, that's a much tighter definition than the definition that the minister gave when he spoke, when he said that they could exercise that power in 63, as long as there was a clear and genuine expectation that they would provide the service.
Or I think he also mentioned that it was an approved business plan. Now that is that is, as I read it, looser than what is in 73, where there actually has to be a contract awarded by GBR before that exemption can be applied. So be hopeful when the minister speaks again, and I think he has his own amendment somewhere in this group, if he could just clarify which of the definitions of passenger services is right, the 1 in 73 or the one that he read out at the beginning? And just as a final word on this, the the letter that the minister sent me on March the 25th said that we intend the order will remain as competition regulator for the rail sector.
This means that any party that feels GBR is acting in a way that is in breach of competition law may raise concerns with the order. Now, the trouble with that is the Bill severely constrains the powers of the. If one looks at the briefing that we were sent. The executive summary says a reduced role for order in relation to access and use of the network. So perhaps the Minister confirmed that, notwithstanding anything in the Bill, notwithstanding the constraints that I've just read out on order, the CMA has a total freedom unconstrained by anything in the Bill, to challenge a decision made by GBR to award or to not to award a franchise to an open access operator if it feels there has been a general breach of competition law, notwithstanding anything that is in this bill, if the minister could put that assurance on the record, it would be of enormous help, not just to me, but also to open access operators.
17:33
Speaker 8
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Speaker 8
My Lords. This has been an interesting debate and rather unusual in the. My noble friend the Minister, making a very long and interesting statement which sadly, we haven't got in writing. So it's maybe maybe there'll be another opportunity to to comment to comment on them, but I would like to ask ask him to comment on 1 or 2 amendments that I've got in this group which relate to freight. The. The first one is amendment two, three two, which would require the Great British Railways to publish a statement setting out the criteria it applies. It would apply when preparing the timetable, including how the rail freight growth objectives, presumably mentioned in the target are under section 17 are considered in capacity conflict.
That's something which is a serious concern to the rail freight sector generally, and I'm sure this is something which we'll want to pursue further in due course. And moving on to amendment. Two, three, eight. This really follows on the rejection by Great British Railways of a relevant application for access. It's very important that GBR publishes the specific reasons forming the basis . And of course. It's something which some of the operators may wish to challenge. And through the Office of Rail Regulation or some other means, depending on what's decided when this bill, which is royal assent and.
The. Amendment two, three, nine. Suggests that. The infrastructure capacity plan must take into account the needs of the rail freight growth target, which I think may, may, may end up as being 50% or 75% or whatever figure it ended up with over so many years. But I think it's very important that it's put down on the face of the bill as much as we can about the comfort which the rail freight sector will get by knowing that there's a fair means of achieving capacity, that it's not being hoarded by GBR for other purposes, and that there is a proper simple and quick appeal process.
That's something which is a serious concern to the rail freight sector generally, and I'm sure this is something which we'll want to pursue further in due course. And moving on to amendment. Two, three, eight. This really follows on the rejection by Great British Railways of a relevant application for access. It's very important that GBR publishes the specific reasons forming the basis . And of course. It's something which some of the operators may wish to challenge. And through the Office of Rail Regulation or some other means, depending on what's decided when this bill, which is royal assent and.
The. Amendment two, three, nine. Suggests that. The infrastructure capacity plan must take into account the needs of the rail freight growth target, which I think may, may, may end up as being 50% or 75% or whatever figure it ended up with over so many years. But I think it's very important that it's put down on the face of the bill as much as we can about the comfort which the rail freight sector will get by knowing that there's a fair means of achieving capacity, that it's not being hoarded by GBR for other purposes, and that there is a proper simple and quick appeal process.
17:36
Speaker 7
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Speaker 7
My Lords, first of all, let me just say briefly to congratulate my noble friend Lord Parkinson of Whitley Bay on his ingenuity in managing to get amendments on heritage railways into many groups in this Bill, and therefore having the opportunity to explain to the committee how important they are. And so I will use the opportunity very briefly again, just to mention the Dean Forest Railway, which is Heritage Railway, based in the forest of Dean in my former constituency and where I currently live, which, as I've previously said, runs on its own track but does interact with GBR infrastructure at Lydney and therefore access to that network is is important.
And anyway, I. So I congratulate him on reminding the Committee about the importance of heritage railways and their importance of fair access to GBR infrastructure. I would say at the outset that I think the committee can see that this whole issue of access to infrastructure is actually one of the biggest concerns that people have got, given this group. And the following five groups are all about access. So I think we're going to be spending the rest of the day here talking about in one form or another access and how that's decided and how the processes work, because it is very important now, I should say, at the beginning, and then it will save the minister pointing this out in the draft rail reform bill that I was responsible for when I was Secretary of state, it to removed decision making about access to infrastructure from the Or and gave it to GBR.
So in principle, I don't have a problem with that. The difficulty I do have, which is where I am supportive of the comments that my noble friend Lord Lansley and my noble friend Lord young made is. Of course, the government have taken a important decision which we wouldn't have done to fundamentally change the context in which GBR will be making these decisions. So. So when we were thinking about it, we yes, we wanted to bring together decision, decision making about track and train, and I support that. But of course, we were doing it in a context where we were envisaging that most, if not all, of the passenger rail services would have been operated by competing private operators.
And so when GBR was making decisions about access to infrastructure, it would have been making decisions between competing private operators, open access operators and freight operators. And it wouldn't itself have had its own passenger rail services, which it would therefore have been tempted to self preference , as my noble two noble friends have referenced. Now the context that we're now in, which is where in the next couple of years, most passenger rail services will be operated by GBR or its own companies clearly sets up at least the temptation for that self. Preferencing and the minister helpfully, both in the meeting he had with me.
In the same way, he had meetings with my two noble friends and I. I'm grateful to him for that meeting and for his remarks at the beginning, as clearly and to some extent has provided some assurances about how these powers are going to operate. But I still think one of the concerns that independent operators have got. So that's open access operators and freight operators, and indeed the those that operate international rail services. And obviously, there are decisions being taken at the moment about competing operators through the Channel Tunnel. And those are decisions as well that fall to will in turn fall to GBR.
Those operators will hear the minister's assurances and I think to some extent be reassured. But but what will be important for their boards and their investors is to have some of this actually reinforced in statute to give them that confidence. And I think that's where I would support the thrust of of my noble friend Lord Lindsay's Amendment two two, four by providing that equitable, non-discriminatory and transparent conditions are in place, and amendments 2 to 8 and 2 to 9, which are to reinforce the presumptions that are in place for open access operators. And so , again, I, I would ask the minister, notwithstanding what he has already said, to just reflect on whether.
Even if he's not supportive of two, two, four, two, two eight and two, two nine, whether there are things that can be done in the bill to strengthen and put into statute some of his assurances that he could bring forward at report stage, which would then obviate the need for others to do so. The final point I would make comes back to this point about future capacity, which my noble friend Lord young referred to, and the bill as it's currently set out in that capacity duty in two part two, says that GBR and my noble friends right must exercise functions to ensure that it retains sufficient capacity over GBR infrastructure.
Then there are two conditions. One is the carrying out of work necessary to maintain and improve GBR infrastructure. That sounds perfectly sensible, but it then talks about the operation of GBR passenger services and of railway passenger services that it expects will in future be GBR passenger services. Now, the Minister, I think, at least provided reassurance that the expect in future has to be pretty firm. It can't just be some vague notion that at some point in the future, maybe someone might provide some rail services. So that is helpful. I would just challenge the presumption actually, that for services that GBR isn't currently providing, this effectively does self-preferencing it because it gives GBR the ability to reserve capacity for services that, even if it's quite solid, that they may be turning up in a year or two, it's not currently providing.
And I don't really see why. If, say, an open access operator came along and said, this capacity that exists, we've got a plan, we've got a pretty solid plan to get these services delivered, you know, within a reasonably short time frame. We've got our plans to get our rolling stock. Here's our application. I don't really see why GBR should be able to turn that down, because it at some point, even if it's in the relatively near future, maybe wanting to provide those services, if someone's ready to do it now and can operate that on a commercial basis and not require taxpayer subsidy to do so, it would seem to me that was a that was a better use of the infrastructure than than assuming that GBR was able to do it.
It also , by not allowing GBR to be able to do. That also means that it stops. It means GBR has to get a move on. In other words, if there are services which it wants to provide, it has to get a move on in doing its planning, securing its own rolling stock and getting on with it, because otherwise somebody else might come along and do it more quickly. Setting up that tension and that competitive process, I think is actually sensible and good for passengers, good for getting rail services delivered more quickly, and does set up a bit of competition.
So I'm not sure I agree with that. That ability for GBR to reserve that capacity for future use at all actually. But even notwithstanding that, there are the valid questions I think that my noble friend said about to what extent does that future use. Does that have to be underpinned by a contract? Does it have to be underpinned by some very clear commitments that the Secretary of State has made about what she intends to do, or can it can it be vaguer than that, notwithstanding, it can't be, you know, at the outer edges of of vagueness.
So I think I'd conclude by saying, I'm not sure I agree with the self-preferencing. I think the ministers should understand that there's been a big contextual change in the plans that we had envisaged versus what he's delivering because of the fact that he's nationalising passenger rail services and increasing the temptation for GBR to self-preferencing its own passenger rail services. And I think that means that open access providers and rail freight providers are going to need more reassurance in this context than they would have done where GBR wasn't operating all of those passenger services. And I look forward, notwithstanding his opening remarks, look forward to how he responds to the questions he's been asked by colleagues in the committee.
And anyway, I. So I congratulate him on reminding the Committee about the importance of heritage railways and their importance of fair access to GBR infrastructure. I would say at the outset that I think the committee can see that this whole issue of access to infrastructure is actually one of the biggest concerns that people have got, given this group. And the following five groups are all about access. So I think we're going to be spending the rest of the day here talking about in one form or another access and how that's decided and how the processes work, because it is very important now, I should say, at the beginning, and then it will save the minister pointing this out in the draft rail reform bill that I was responsible for when I was Secretary of state, it to removed decision making about access to infrastructure from the Or and gave it to GBR.
So in principle, I don't have a problem with that. The difficulty I do have, which is where I am supportive of the comments that my noble friend Lord Lansley and my noble friend Lord young made is. Of course, the government have taken a important decision which we wouldn't have done to fundamentally change the context in which GBR will be making these decisions. So. So when we were thinking about it, we yes, we wanted to bring together decision, decision making about track and train, and I support that. But of course, we were doing it in a context where we were envisaging that most, if not all, of the passenger rail services would have been operated by competing private operators.
And so when GBR was making decisions about access to infrastructure, it would have been making decisions between competing private operators, open access operators and freight operators. And it wouldn't itself have had its own passenger rail services, which it would therefore have been tempted to self preference , as my noble two noble friends have referenced. Now the context that we're now in, which is where in the next couple of years, most passenger rail services will be operated by GBR or its own companies clearly sets up at least the temptation for that self. Preferencing and the minister helpfully, both in the meeting he had with me.
In the same way, he had meetings with my two noble friends and I. I'm grateful to him for that meeting and for his remarks at the beginning, as clearly and to some extent has provided some assurances about how these powers are going to operate. But I still think one of the concerns that independent operators have got. So that's open access operators and freight operators, and indeed the those that operate international rail services. And obviously, there are decisions being taken at the moment about competing operators through the Channel Tunnel. And those are decisions as well that fall to will in turn fall to GBR.
Those operators will hear the minister's assurances and I think to some extent be reassured. But but what will be important for their boards and their investors is to have some of this actually reinforced in statute to give them that confidence. And I think that's where I would support the thrust of of my noble friend Lord Lindsay's Amendment two two, four by providing that equitable, non-discriminatory and transparent conditions are in place, and amendments 2 to 8 and 2 to 9, which are to reinforce the presumptions that are in place for open access operators. And so , again, I, I would ask the minister, notwithstanding what he has already said, to just reflect on whether.
Even if he's not supportive of two, two, four, two, two eight and two, two nine, whether there are things that can be done in the bill to strengthen and put into statute some of his assurances that he could bring forward at report stage, which would then obviate the need for others to do so. The final point I would make comes back to this point about future capacity, which my noble friend Lord young referred to, and the bill as it's currently set out in that capacity duty in two part two, says that GBR and my noble friends right must exercise functions to ensure that it retains sufficient capacity over GBR infrastructure.
Then there are two conditions. One is the carrying out of work necessary to maintain and improve GBR infrastructure. That sounds perfectly sensible, but it then talks about the operation of GBR passenger services and of railway passenger services that it expects will in future be GBR passenger services. Now, the Minister, I think, at least provided reassurance that the expect in future has to be pretty firm. It can't just be some vague notion that at some point in the future, maybe someone might provide some rail services. So that is helpful. I would just challenge the presumption actually, that for services that GBR isn't currently providing, this effectively does self-preferencing it because it gives GBR the ability to reserve capacity for services that, even if it's quite solid, that they may be turning up in a year or two, it's not currently providing.
And I don't really see why. If, say, an open access operator came along and said, this capacity that exists, we've got a plan, we've got a pretty solid plan to get these services delivered, you know, within a reasonably short time frame. We've got our plans to get our rolling stock. Here's our application. I don't really see why GBR should be able to turn that down, because it at some point, even if it's in the relatively near future, maybe wanting to provide those services, if someone's ready to do it now and can operate that on a commercial basis and not require taxpayer subsidy to do so, it would seem to me that was a that was a better use of the infrastructure than than assuming that GBR was able to do it.
It also , by not allowing GBR to be able to do. That also means that it stops. It means GBR has to get a move on. In other words, if there are services which it wants to provide, it has to get a move on in doing its planning, securing its own rolling stock and getting on with it, because otherwise somebody else might come along and do it more quickly. Setting up that tension and that competitive process, I think is actually sensible and good for passengers, good for getting rail services delivered more quickly, and does set up a bit of competition.
So I'm not sure I agree with that. That ability for GBR to reserve that capacity for future use at all actually. But even notwithstanding that, there are the valid questions I think that my noble friend said about to what extent does that future use. Does that have to be underpinned by a contract? Does it have to be underpinned by some very clear commitments that the Secretary of State has made about what she intends to do, or can it can it be vaguer than that, notwithstanding, it can't be, you know, at the outer edges of of vagueness.
So I think I'd conclude by saying, I'm not sure I agree with the self-preferencing. I think the ministers should understand that there's been a big contextual change in the plans that we had envisaged versus what he's delivering because of the fact that he's nationalising passenger rail services and increasing the temptation for GBR to self-preferencing its own passenger rail services. And I think that means that open access providers and rail freight providers are going to need more reassurance in this context than they would have done where GBR wasn't operating all of those passenger services. And I look forward, notwithstanding his opening remarks, look forward to how he responds to the questions he's been asked by colleagues in the committee.
17:46
17:46
17:46
Speaker 11
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Speaker 11
Passenger railways, as they exist more or less. You know, there's always technical bits around the edge. And that the objective of the directing mind, which is absolutely at the essence of this bill and it producing benefit the essence of of the. Directing mind would be to provide capacity in the optimal way for that block of capability which it being nationalised, we owned. And then there's a debate about what's left over and what's left over in my mind was saying, right, this is just what's in my mind would be relatively small. It's important that that group ended up in.
Being handled in what I loosely call an equitable way. And the problem is, reading all the bits about what I was thinking was a small group, sort of. Now that speech is sufficiently confused to communicate how confused I am about it all. I don't think this. Even this committee is a good place to try and thrash this out. I thank Lord.
Being handled in what I loosely call an equitable way. And the problem is, reading all the bits about what I was thinking was a small group, sort of. Now that speech is sufficiently confused to communicate how confused I am about it all. I don't think this. Even this committee is a good place to try and thrash this out. I thank Lord.
17:47
17:47
17:48
17:48
Speaker 11
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Speaker 11
Don't want to do. The Great British Railway are thinking of as I'm thinking and some other people are thinking like Lord Young's thinking and they end up with internal conflict, I think these. This issue is possibly the most important issue in. In the Bill and in the future operation, and I hope the noble Lord, the Minister might think of some way how we might get together in a more sort of discursive environment to pursue a much clearer view of where the split should be.
17:49
Speaker 9
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Speaker 9
My Lords, this group of amendments is trying to sort of understand, really the thinking behind the access and use policy, and to understand access for other operators, open access operators, freight operators and the heritage sector alongside Great British Railway Services. The Minister has given some clarity and assurance on this, which I am grateful. The debate does seem to be overlapping future groups and the whole afternoon is going to be on access, so I think some of these points, you know, will start to merge together. Clearly, the heritage sector, which we have heard so much about in this in this committee stage, I'm sure, must be considered and included as part of the access and use policy.
And I am sure the noble Lord, the minister will assure us of this amendment 251 requires Great British Railways to consult open access operators on its access and use policy. Well, surely any organisation of that size and proper organisation would consult all key partners as they develop such a policy. So I'm not sure that really needs to be on the face of the bill. We are content with the government's own amendment in this group, and look forward to the Minister's further comments on this group.
And I am sure the noble Lord, the minister will assure us of this amendment 251 requires Great British Railways to consult open access operators on its access and use policy. Well, surely any organisation of that size and proper organisation would consult all key partners as they develop such a policy. So I'm not sure that really needs to be on the face of the bill. We are content with the government's own amendment in this group, and look forward to the Minister's further comments on this group.
17:50
Speaker 4
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Speaker 4
My Lords, may I thank the noble Lord Minister, first of all for his innovative leaping in at the beginning of the group and setting that. Helping to set the terms of debate, because I think that was a very useful contribution. And helped all of us actually, may I say briefly, in relation to the noble Lord, Lord Tunnicliffe, it is not a small residue. 25 on current patterns, 25% of train movements on the network after this system is brought into place will not be GBR movements. There will be non GBR movements. That is not a small residue and.
And it is to protect the interests of those parties and to understand and be sure that they are protected, that we are embarking on this debate fundamentally. The fact is that all organisations, even those run by the most professional and well, most well-intentioned people, have a tendency to self prefer. That is not controversial. It's well established in any business book that you look at, but it's implicitly admitted by the noble Lord, the minister, who wouldn't have spent a considerable amount of the debate this afternoon explaining how he was going to mitigate against that tendency to self preference.
So can we take that as a as a common ground and and. Repeatedly, while my noble friends Lord, Lord Lansley and Lord Young of Cookham explored in detail how those mitigations might work. And that was a very valuable exposure. It was my noble friend, Lord Harper, who in a sense, put his his his finger on it and said, why are we creating this problem in the first place? We are setting out to create a problem in which there is a reward for self preference. We don't have to do it. The noble Lord, Lord Harper, explained that when he was in charge of policy formation on this, the system he was going to propose did not contain that.
Now, you could argue that it. You could argue that he was being maybe rosy. There might be objective rosy spectacled on it. There were objections that could be raised. I'm not buying in necessarily to his solution just because it's it's his. But I'm making the point because it shows there are alternatives and there are alternatives that could work better and avoid this enormous problem that's being made. I mean, just to take one example, I'll come to my detailed amendments in a moment. But when we come to amendment two, two, three, I think it's amendment two, two, three.
Amendment two, two, three in my name is now defunct because the government has more or less preempted it. There was a conflict in the text between the provisions of the regulations, which said that an infrastructure manager couldn't make a decision about access . And the thrust of the bill, which is an infrastructure manager, will make a decision about access. And my amendment was exploring that. But then I only then did I spot that in the Commons. The government had got there ahead of me on that and had eliminated this requirement, this prohibition on in the regulations that the the existing regulations that an infrastructure manager couldn't make those decisions so actively create actively removing a conflict in the text by creating a conflict of interest, building conflicts of interest into the bill quite deliberately.
And it is it is just staggering that this is going ahead and being allowed. The noble Lord, the minister, says that these things must be internal. It must all be under one directing mind. That is an assertion of faith. There is no evidence that it must be all under one directing mind to give an alternative view, and I. Again, I. Lord Harper, has his noble Lord, my noble friend has his alternative view. I could give another alternative view. It is perfectly possible, and this is the thrust of my clause . Stand part motions. It is perfectly possible that you could say that those access decisions be taken outside the structure by an independent decision maker doesn't have to be a regulator.
As such, the Orer is making those decisions already there to be moved inside. Why? Only for the purpose of creating conflicts of interest which will work themselves out almost certainly badly. And the protections are almost entirely internal. The noble Lord, the minister refers to appeals to the Competition and Markets Authority. That is a fine body, let me just say, comes to mind that for many years, the Competition and Markets Authority produced reports saying that competition in the supermarket sector was robust and did not need to be challenged by the regulator. Then Aldi and Lidl came along and we found out just how robust the competition was in the supermarket sector as it collapsed in every direction when new efficiencies were introduced by new competitors.
And I asked a question in the chamber the other day about the huge premium £0.20 a litre being charged on fuel in motorway service stations, and the minister admitted that the Competition and Markets Authority had found that there was weak competition in that sector. Well, we've known it for years. There's been weak competition. What has been done about it? If you're a heritage railway and you cannot get access, let's say the forest of Dean, and you cannot get access to the GBR, to the Great British Rail network that you need for the services and the activities that you're undertaking in the next six months or so.
There's absolutely no point going to the Competition and Markets Authority and talking about it. That is the wrong address to be going to. And as for the Orer, we know that the bill deliberately confines the basis of their appeals to procedural matters that are under judicial, that are akin to judicial review proceedings. And the minister today sent a letter which I've seen to my noble friend, Lord Lansley, several pages following a meeting they had. All it did was describe how judicial review works, and there was nothing more in the letter than that. Everything in it we know already.
And it's how judicial review works. So nothing is being added to this at all. Deliberately setting out to create conflicts of interest. My Lord, I won't therefore spend much more time on my amendments. Clause 59 and clause 69 stand part would keep effectively keep the decisions on access with the Orer who have a track record in doing it. After all, let us also bear in mind that great British Rail Network Rail DFT o the various components that will go together to make Great British Rail do not have any expertise in doing this at the moment.
The expertise, such as it is, is with the ORR. This all has to be built from scratch. They have no experience of doing this, but it's all being transferred to them and taken away from the people who might know what they were doing. I've referred to amendment two, two, three. Amendments two, two, seven, and two, five, one are much more minor. Amendment two, two, seven requires the access and use statement to be, which were not not going to see in final form until the spring to be subject to parliamentary scrutiny. Amendment 251 requires formal consultation with the on the access and use policy with the Open Access Operators and others.
And moreover, I know the noble Baroness, lady Pidgeon, doesn't see the need to have that. On the face of the Bill. It's quite common, actually, to have consultation requirements on the face of bills and in such processes as planning processes and so forth. These are statutory consultation requirements. That's how they they become statutory because they are referred to in a bill. It's very common. But but but I go further, and I remind noble Lords that there are powers in the Bill to revise and replace this document. And open access operators should be statutory consultees, not simply on the first iteration of the document.
And this applies, in my view, should apply to freight and heritage railways as well other users of the infrastructure. But they should be statutory consultees on when revisions arise.
And it is to protect the interests of those parties and to understand and be sure that they are protected, that we are embarking on this debate fundamentally. The fact is that all organisations, even those run by the most professional and well, most well-intentioned people, have a tendency to self prefer. That is not controversial. It's well established in any business book that you look at, but it's implicitly admitted by the noble Lord, the minister, who wouldn't have spent a considerable amount of the debate this afternoon explaining how he was going to mitigate against that tendency to self preference.
So can we take that as a as a common ground and and. Repeatedly, while my noble friends Lord, Lord Lansley and Lord Young of Cookham explored in detail how those mitigations might work. And that was a very valuable exposure. It was my noble friend, Lord Harper, who in a sense, put his his his finger on it and said, why are we creating this problem in the first place? We are setting out to create a problem in which there is a reward for self preference. We don't have to do it. The noble Lord, Lord Harper, explained that when he was in charge of policy formation on this, the system he was going to propose did not contain that.
Now, you could argue that it. You could argue that he was being maybe rosy. There might be objective rosy spectacled on it. There were objections that could be raised. I'm not buying in necessarily to his solution just because it's it's his. But I'm making the point because it shows there are alternatives and there are alternatives that could work better and avoid this enormous problem that's being made. I mean, just to take one example, I'll come to my detailed amendments in a moment. But when we come to amendment two, two, three, I think it's amendment two, two, three.
Amendment two, two, three in my name is now defunct because the government has more or less preempted it. There was a conflict in the text between the provisions of the regulations, which said that an infrastructure manager couldn't make a decision about access . And the thrust of the bill, which is an infrastructure manager, will make a decision about access. And my amendment was exploring that. But then I only then did I spot that in the Commons. The government had got there ahead of me on that and had eliminated this requirement, this prohibition on in the regulations that the the existing regulations that an infrastructure manager couldn't make those decisions so actively create actively removing a conflict in the text by creating a conflict of interest, building conflicts of interest into the bill quite deliberately.
And it is it is just staggering that this is going ahead and being allowed. The noble Lord, the minister, says that these things must be internal. It must all be under one directing mind. That is an assertion of faith. There is no evidence that it must be all under one directing mind to give an alternative view, and I. Again, I. Lord Harper, has his noble Lord, my noble friend has his alternative view. I could give another alternative view. It is perfectly possible, and this is the thrust of my clause . Stand part motions. It is perfectly possible that you could say that those access decisions be taken outside the structure by an independent decision maker doesn't have to be a regulator.
As such, the Orer is making those decisions already there to be moved inside. Why? Only for the purpose of creating conflicts of interest which will work themselves out almost certainly badly. And the protections are almost entirely internal. The noble Lord, the minister refers to appeals to the Competition and Markets Authority. That is a fine body, let me just say, comes to mind that for many years, the Competition and Markets Authority produced reports saying that competition in the supermarket sector was robust and did not need to be challenged by the regulator. Then Aldi and Lidl came along and we found out just how robust the competition was in the supermarket sector as it collapsed in every direction when new efficiencies were introduced by new competitors.
And I asked a question in the chamber the other day about the huge premium £0.20 a litre being charged on fuel in motorway service stations, and the minister admitted that the Competition and Markets Authority had found that there was weak competition in that sector. Well, we've known it for years. There's been weak competition. What has been done about it? If you're a heritage railway and you cannot get access, let's say the forest of Dean, and you cannot get access to the GBR, to the Great British Rail network that you need for the services and the activities that you're undertaking in the next six months or so.
There's absolutely no point going to the Competition and Markets Authority and talking about it. That is the wrong address to be going to. And as for the Orer, we know that the bill deliberately confines the basis of their appeals to procedural matters that are under judicial, that are akin to judicial review proceedings. And the minister today sent a letter which I've seen to my noble friend, Lord Lansley, several pages following a meeting they had. All it did was describe how judicial review works, and there was nothing more in the letter than that. Everything in it we know already.
And it's how judicial review works. So nothing is being added to this at all. Deliberately setting out to create conflicts of interest. My Lord, I won't therefore spend much more time on my amendments. Clause 59 and clause 69 stand part would keep effectively keep the decisions on access with the Orer who have a track record in doing it. After all, let us also bear in mind that great British Rail Network Rail DFT o the various components that will go together to make Great British Rail do not have any expertise in doing this at the moment.
The expertise, such as it is, is with the ORR. This all has to be built from scratch. They have no experience of doing this, but it's all being transferred to them and taken away from the people who might know what they were doing. I've referred to amendment two, two, three. Amendments two, two, seven, and two, five, one are much more minor. Amendment two, two, seven requires the access and use statement to be, which were not not going to see in final form until the spring to be subject to parliamentary scrutiny. Amendment 251 requires formal consultation with the on the access and use policy with the Open Access Operators and others.
And moreover, I know the noble Baroness, lady Pidgeon, doesn't see the need to have that. On the face of the Bill. It's quite common, actually, to have consultation requirements on the face of bills and in such processes as planning processes and so forth. These are statutory consultation requirements. That's how they they become statutory because they are referred to in a bill. It's very common. But but but I go further, and I remind noble Lords that there are powers in the Bill to revise and replace this document. And open access operators should be statutory consultees, not simply on the first iteration of the document.
And this applies, in my view, should apply to freight and heritage railways as well other users of the infrastructure. But they should be statutory consultees on when revisions arise.
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Speaker 12
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Speaker 12
Before the minister responds to the debate. Can I just say I listened with interest to my noble friend Lord Young of Cookham and noble Lord Harper, and I think it in my mind the question that I want to put to the Minister in replying. When the capacity duty is being exercised by GBR, and in particular when it is looking at what its future requirements for passenger services looks like and what capacity it will require, it should do so. As I understand the way the minister intends is that it should do so by reference to the passenger services that are designated under section 31 and the subject from the Secretary of State of the award of a public service contract.
That's how section 31 works. So the question is how specific? Because I don't think. I don't remember when we. Considered section 31, how specific about the future passenger services of GBR will be the designation by the Secretary of State? Because if it's not very specific, GBR will be free under the capacity duty to think rather expansive thoughts about its future passenger services, which technically wouldn't fit under the definition in clause 73 that my noble friend Lord Young of Cookham was referring to because they are not designated under section 31. So there is a bit of a tension there, and I'd be interested to see, if not now, later, later stage how the minister sees that particular question being resolved.
That's how section 31 works. So the question is how specific? Because I don't think. I don't remember when we. Considered section 31, how specific about the future passenger services of GBR will be the designation by the Secretary of State? Because if it's not very specific, GBR will be free under the capacity duty to think rather expansive thoughts about its future passenger services, which technically wouldn't fit under the definition in clause 73 that my noble friend Lord Young of Cookham was referring to because they are not designated under section 31. So there is a bit of a tension there, and I'd be interested to see, if not now, later, later stage how the minister sees that particular question being resolved.
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Speaker 2
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Speaker 2
My Lords, I'm grateful to the committee for listening to the earlier speech that I made. And I've they'll be relieved to know that I've deleted quite a lot of the remarks that I'm. I would otherwise have been about to make because I said them already. The only thing I'd say to the noble Lord Moylan is simply this, which is that the present system doesn't work, and I won't repeat the examples that I've used. But actually, nobody is, in fact, currently in charge of allocating the proper use of some extraordinarily expensive infrastructure on the railway. And that is what we're seeking to to deal with.
Looking at the first group of amendments, two, two, two, two, two, four , two, two, five two, two eight and 229. The government I, I, I would again place on the record that the government fully recognises the value of open access, international freight heritage and charter rail operators. And the clause 592 A requires GBR to set out the process by which third party operators, including all the definition I've just said, can apply for and obtain access to the network and the draft AUP, published for consultation last month, provides further detail. I have discussed it both individually with some noble Lords, and I would encourage all noble Lords to review it and engage with the consultation.
Fairness and non-discrimination are at the heart of this process. GBR will be subject to public law principles and competition law, with the O continuing to provide independent oversight and enforcement, and GBR will be bound by the duties in clause 18, including duties to promote freight and promote the interests of passengers, and it must have regard to the rail freight growth target set by the Secretary of State under clause 17. The result GBR must consider the interests of all network users when determining the best use of the network, and cannot simply favour its own services on on Heritage Rail specifically, I will again reassure the noble Lord, Lord Parkinson, that the Future Access Framework is intended to build on, rather than replace, many of the mechanisms familiar to heritage and charter operators today.
And I won't repeat some of the statistics I've previously used about the relative. System for them, even though, as he says, it's it's not really provided for in any of the existing arrangements, but I was delighted to speak with the noble Lord yesterday, together with my noble friend Lord Faulkner, about how to ensure that heritage and charter operators can obtain the confidence they need through a specific response to the access and use policy. And if, if either or both of the noble Lords choose to respond to the access and use policy in the terms that we discussed yesterday, I will be delighted to write and support that.
Turning to amendment 226, there is a significant overlap between some of the duties set out in that amendment and the duties which the bill already applies to GBR under clause 18, the bill already requires GBR to consider passengers, disabled passengers, freight certainty for businesses, social and economic factors, the environment and cost while when carrying out all of its access activities and I therefore do not think a slightly separate duplicative set of duties for access is is useful on amendment 224 from the noble Lord Lansley. Sections two, two, 2.22 and 2.23 of the Access and Use policy is clear that GBR must allocate capacity in a fair, transparent and non-discriminatory way, and I hope that's helpful.
The. I would say that certainly the noble Lord young raised two points, one of which is the powers of the CMA, and this bill does not affect the CMA's powers at all, and it has more power and can intervene. And the powers in this respect are not altered by the Bill. It's only its role, its actual role on access. The noble Lord young made some points about clause 63 and the. The word must. And the noble Lord Harper and noble Lord Lansley also are raised that issue. I think it's worth saying that GBR can't reserve capacity for future use in a way that contradicts its infrastructure capacity plan, which will already have considered whether an open access operator and the extent to which it could provide services which better used the infrastructure.
63 is, in our view, not for Self-preferencing, and it enables it designed to ensure that funded services are delivered. But I would like to reflect further on the points that the noble Lord young made, because I'd like to read Hansard very carefully about what he said, and I'd like to be clear about my response to it, so that we're not so that we're not unduly I don't I don't I don't speak now about something that I would like to think clear, think clearly about in order that we have the definition between us, that we the clarity that we seek to have.
Looking at the first group of amendments, two, two, two, two, two, four , two, two, five two, two eight and 229. The government I, I, I would again place on the record that the government fully recognises the value of open access, international freight heritage and charter rail operators. And the clause 592 A requires GBR to set out the process by which third party operators, including all the definition I've just said, can apply for and obtain access to the network and the draft AUP, published for consultation last month, provides further detail. I have discussed it both individually with some noble Lords, and I would encourage all noble Lords to review it and engage with the consultation.
Fairness and non-discrimination are at the heart of this process. GBR will be subject to public law principles and competition law, with the O continuing to provide independent oversight and enforcement, and GBR will be bound by the duties in clause 18, including duties to promote freight and promote the interests of passengers, and it must have regard to the rail freight growth target set by the Secretary of State under clause 17. The result GBR must consider the interests of all network users when determining the best use of the network, and cannot simply favour its own services on on Heritage Rail specifically, I will again reassure the noble Lord, Lord Parkinson, that the Future Access Framework is intended to build on, rather than replace, many of the mechanisms familiar to heritage and charter operators today.
And I won't repeat some of the statistics I've previously used about the relative. System for them, even though, as he says, it's it's not really provided for in any of the existing arrangements, but I was delighted to speak with the noble Lord yesterday, together with my noble friend Lord Faulkner, about how to ensure that heritage and charter operators can obtain the confidence they need through a specific response to the access and use policy. And if, if either or both of the noble Lords choose to respond to the access and use policy in the terms that we discussed yesterday, I will be delighted to write and support that.
Turning to amendment 226, there is a significant overlap between some of the duties set out in that amendment and the duties which the bill already applies to GBR under clause 18, the bill already requires GBR to consider passengers, disabled passengers, freight certainty for businesses, social and economic factors, the environment and cost while when carrying out all of its access activities and I therefore do not think a slightly separate duplicative set of duties for access is is useful on amendment 224 from the noble Lord Lansley. Sections two, two, 2.22 and 2.23 of the Access and Use policy is clear that GBR must allocate capacity in a fair, transparent and non-discriminatory way, and I hope that's helpful.
The. I would say that certainly the noble Lord young raised two points, one of which is the powers of the CMA, and this bill does not affect the CMA's powers at all, and it has more power and can intervene. And the powers in this respect are not altered by the Bill. It's only its role, its actual role on access. The noble Lord young made some points about clause 63 and the. The word must. And the noble Lord Harper and noble Lord Lansley also are raised that issue. I think it's worth saying that GBR can't reserve capacity for future use in a way that contradicts its infrastructure capacity plan, which will already have considered whether an open access operator and the extent to which it could provide services which better used the infrastructure.
63 is, in our view, not for Self-preferencing, and it enables it designed to ensure that funded services are delivered. But I would like to reflect further on the points that the noble Lord young made, because I'd like to read Hansard very carefully about what he said, and I'd like to be clear about my response to it, so that we're not so that we're not unduly I don't I don't I don't speak now about something that I would like to think clear, think clearly about in order that we have the definition between us, that we the clarity that we seek to have.
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Speaker 7
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Speaker 7
Can I just just on that point, as the ministers concluded, that little section. Can I just say to him, first of all, I'm grateful that he said that he's prepared to, to, to reflect on it. But can I just say the speech that the noble Lord, Lord Tunnicliffe, made was actually very helpful? I'm not sure he realizes how helpful it was. And there were two points he made. One was on assumptions about the capacity on the network used by non GBR players, which my noble friend Lord Moylan, I think set out clearly. But actually it was the noble Lord, Lord Tunnicliffe's assumption at the beginning that the point of the allocation would have been to preference the the services which are being nationalised, which GBR is operating.
Now that assumption he's an experienced railwayman and person who's operated in this sector. It is exactly that assumption that open access operators and freight operators are so worried about, because they think that is exactly what's going to happen. And my noble friend Lord Land's amendment, by putting those principles in statute, I think is a better guarantee than just having it in the access and use policy. And perhaps when the minister is reflecting, he could consider that point as well.
Now that assumption he's an experienced railwayman and person who's operated in this sector. It is exactly that assumption that open access operators and freight operators are so worried about, because they think that is exactly what's going to happen. And my noble friend Lord Land's amendment, by putting those principles in statute, I think is a better guarantee than just having it in the access and use policy. And perhaps when the minister is reflecting, he could consider that point as well.
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Speaker 2
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Speaker 2
My answer to the noble Lord about that is that the construction of this bill precisely recognises the current use of the railway, in my view, and and consideration between clause 60 and 63 and the clarity that I'm seeking to bring to the limited circumstances of clause 63 are designed to show that, given the number of users of the railway and given and given, but also given the precious nature and the cost of the infrastructure, there's a job to do to use it in the best way, which is separate from the job that clause 63 seeks to do, which is to make sure that GBR operates what the Secretary of State pays it to operate.
We'd never intended clause 63 to say anything other than that, but I think it is worth saying because there might be circumstances in the future in which GBR, frankly, might financially prefer not to operate. Literally all the services that the Secretary of State is paying it to, and it has to. I think that's I think that's my point, but I would I would echo the point that I made earlier, which is that I'd like to reflect on on this debate, having had it, because I want to make sure that the bill that we that we bring in the next stage is as clear as it can be about what we're doing here, and I do hope that noble Lords have , have have noticed that that in particular, we recognise the current users of the railway, whoever they are, and we're seeking to make sure that that they have they they have as much clarity for the future as they can because they're providing some important services themselves on two, two, three and two, two, seven, the the noble Lord Moylan is seeking basically to reinstate the present access and management regulations, and I'm sure that he won't be surprised to learn that that actually it's it's the existence of the current regulations that prevent the integration of train and track and the best use of the infrastructure that we are actually seeking to seeking to, to do the three month parliamentary lying in period in amendment two, two, two, seven, I think creates significant operational and financial risks to the railway.
Unnecessary delays won't be welcomed either by freight or open access operators, both of whom actually rely on timely access decisions. And it's important to recognise the nature of the access and use policy. It's a technical industry document designed to provide a fair and transparent process through which operators to apply for access. It sets out matters such as timescales, the information applicants must provide, and the way in which GBR will assess applications in line with its statutory responsibilities. It is therefore completely right that it's an industry and expert led document, rather than one that requires ministerial or parliamentary scrutiny, and I urge the noble Lord to withdraw those amendments.
Turning to 251 and 251 A of course, we've already seen that the the consultation on the draft Access and use policy has been developed closely with, and I think, welcomed by the industry. I would like to draw the noble Lords attention to paragraph one three of the document, which provides a list of parties GBR will consult before making changes to the AUP. This explicitly includes parties who hold track access contracts and parties that are registered with GBR as prospective applicants, and that ensures
We'd never intended clause 63 to say anything other than that, but I think it is worth saying because there might be circumstances in the future in which GBR, frankly, might financially prefer not to operate. Literally all the services that the Secretary of State is paying it to, and it has to. I think that's I think that's my point, but I would I would echo the point that I made earlier, which is that I'd like to reflect on on this debate, having had it, because I want to make sure that the bill that we that we bring in the next stage is as clear as it can be about what we're doing here, and I do hope that noble Lords have , have have noticed that that in particular, we recognise the current users of the railway, whoever they are, and we're seeking to make sure that that they have they they have as much clarity for the future as they can because they're providing some important services themselves on two, two, three and two, two, seven, the the noble Lord Moylan is seeking basically to reinstate the present access and management regulations, and I'm sure that he won't be surprised to learn that that actually it's it's the existence of the current regulations that prevent the integration of train and track and the best use of the infrastructure that we are actually seeking to seeking to, to do the three month parliamentary lying in period in amendment two, two, two, seven, I think creates significant operational and financial risks to the railway.
Unnecessary delays won't be welcomed either by freight or open access operators, both of whom actually rely on timely access decisions. And it's important to recognise the nature of the access and use policy. It's a technical industry document designed to provide a fair and transparent process through which operators to apply for access. It sets out matters such as timescales, the information applicants must provide, and the way in which GBR will assess applications in line with its statutory responsibilities. It is therefore completely right that it's an industry and expert led document, rather than one that requires ministerial or parliamentary scrutiny, and I urge the noble Lord to withdraw those amendments.
Turning to 251 and 251 A of course, we've already seen that the the consultation on the draft Access and use policy has been developed closely with, and I think, welcomed by the industry. I would like to draw the noble Lords attention to paragraph one three of the document, which provides a list of parties GBR will consult before making changes to the AUP. This explicitly includes parties who hold track access contracts and parties that are registered with GBR as prospective applicants, and that ensures
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Speaker 7
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Speaker 7
Are all able to feed in their views. Clause 66 requires consultation not only in relation to the , but also the preparation and revision of the working timetable under clause 61 that ensures a transparent and consultative process without requiring long named lists. And I hope that reassures that reassures both noble Lords and my noble Lord Moylan and my noble friend Lord Berkeley, that they can withdraw their amendments. Finally, I turn to amendment in my name. 252 as I've mentioned, Network Rail has now launched the Access and Use Policy consultation, working in close collaboration with the railway industry and devolved governments ahead of the establishment of GBR.
And as I've said, it's been it's been welcomed across the sector by people who are keen to see it as soon as possible. Government's intention has always been that GBR, once established, should rely on Network Rail's consultation on the AUP and to support that objective, we sought to include a provision in the railway Bill. However, following further legal analysis, it's become clear that a small but important technical correction is required to enable GBR to treat the consultation undertaken by Network Rail as having been carried out by GBR. That this amendment gives effect to that original policy intention, and without it, there would be a practical implication to the industry, including the need to participate in a wasteful repeat of the consultation process, and it would also prolong uncertainty for operators with so with the with the leave, with the leave of the committee and given this is a simply a technical change to correct a mistake on the.
In the drafting I would like to make. I hope the Committee will allow me to make this amendment amendment today. Just finally, I would say, in response to the noble Lord Harper, that the. The . The competition regulation of international services through the Channel Tunnel is not affected by this legislation, and the noble Lord Berkeley spoke to various amendments, but I think he will find that they're all in the next group, and I hope to respond to those amendments then. And of course, I'm grateful to the my noble friend Lord Tunnicliffe, for his view, and I'm more than happy to further discuss this further.
Having reflected on the discussion that we're having that we will have had today on this group, and we'll have on the other groups.
And as I've said, it's been it's been welcomed across the sector by people who are keen to see it as soon as possible. Government's intention has always been that GBR, once established, should rely on Network Rail's consultation on the AUP and to support that objective, we sought to include a provision in the railway Bill. However, following further legal analysis, it's become clear that a small but important technical correction is required to enable GBR to treat the consultation undertaken by Network Rail as having been carried out by GBR. That this amendment gives effect to that original policy intention, and without it, there would be a practical implication to the industry, including the need to participate in a wasteful repeat of the consultation process, and it would also prolong uncertainty for operators with so with the with the leave, with the leave of the committee and given this is a simply a technical change to correct a mistake on the.
In the drafting I would like to make. I hope the Committee will allow me to make this amendment amendment today. Just finally, I would say, in response to the noble Lord Harper, that the. The . The competition regulation of international services through the Channel Tunnel is not affected by this legislation, and the noble Lord Berkeley spoke to various amendments, but I think he will find that they're all in the next group, and I hope to respond to those amendments then. And of course, I'm grateful to the my noble friend Lord Tunnicliffe, for his view, and I'm more than happy to further discuss this further.
Having reflected on the discussion that we're having that we will have had today on this group, and we'll have on the other groups.
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Speaker 8
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Speaker 8
The Lords. I'm very grateful to the noble Lord, the Minister, both for the remarks he has just made and his earlier ones. I think it was helpful for the committee's deliberations to hear from him twice on on this first group of amendments that relates to access and use. I should say the heritage rail operators are fully aware. They are part of the the 25% of movements. As my noble friend Lord Moylan says it, that will remain after the. The creation of GBR and many of the issues that face them, as I said in my opening remarks, affect many of the other operators.
I'm grateful to the noble Lord, the Minister, for the time that he made available yesterday to the noble Lord, Lord Falconer and me, and we certainly will be responding to the consultation on the Access and use policy and will continue the discussions with him so that I hope we can do so. As he says in in concert there. That is very, very welcome. So on the specific issues as face the heritage railways in our amendments 2 to 2 and 2 to 5, I beg leave to withdraw amendment 222.
I'm grateful to the noble Lord, the Minister, for the time that he made available yesterday to the noble Lord, Lord Falconer and me, and we certainly will be responding to the consultation on the Access and use policy and will continue the discussions with him so that I hope we can do so. As he says in in concert there. That is very, very welcome. So on the specific issues as face the heritage railways in our amendments 2 to 2 and 2 to 5, I beg leave to withdraw amendment 222.
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Speaker 15
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Speaker 15
Amendment be withdrawn. The amendment is by leave withdrawn. Amendment 223 . Lord Moylan. Not moved. Not moved. Not moved. 224 Lord Lansdowne. not moved moved. 225 Lord Parkinson moved moved. 226 Lord Grayling not moved. Amendment 227 Lord Moylan. not moved moved. The question is that clause 59 stand part of the bill, as many of that opinion will say.
Content contrary, not content. The contents have it after clause 59. Amendment 228, Lord Grayling moved and amendment 229. Lord Moylan moved in. Clause 60. Amendment 230 Lord Parkinson.
Content contrary, not content. The contents have it after clause 59. Amendment 228, Lord Grayling moved and amendment 229. Lord Moylan moved in. Clause 60. Amendment 230 Lord Parkinson.
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Speaker 8
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Speaker 8
Lord, I don't want to try the patience of the committee with what my noble friend Lord Harper described earlier as my ingenuity and finding lots of ways of mentioning Heritage rail. Again, the issues that we are. The noble Lord, Lord Faulkner and I are raising in our amendment 230 are not specific to heritage railways. They affect all other operators that will be operating in the. The new landscape. I listened with interest to the debate we had in the previous group, particularly the contributions of my noble friend Lord Lansley and Lord Young of Cookham on clause 63 and the.
The. The duty on Great British Railways that the must duty to exercise its functions so as to ensure that it retains sufficient capacity over GBR infrastructure to allow for the operation of its own services and services that it expects will be its services in the future. And our amendment here relates to the need to accommodate other services in the infrastructure capacity plan that Great British Railways will be looking at. Capacity is already tightly constrained and in the case of heritage charter operators, as mentioned previously, the. The. The popular paths to the. On the North Yorkshire Moors to to Whitby.
The constraints over platform capacity as it affects the Polar Express at Euston, for instance. And there's nervousness that as capacity remains constrained, then other operators not just heritage railway operators, but. But other operators will be easy to squeeze, particularly in light of the duties in clause 63 and elsewhere on on GBR. More broadly, the bill, the access and use policy and the remarks that we've had so far are all set out in terms of managing existing capacity and identifying how it should be used, rather than envisaging how any additions and the story of our railways has been one of growth and innovation.
It might be helpful, I think, to hear from the noble Lord, the Minister, about how he sees additional capacity and new routes and new uses featuring in the the new landscape. And I've mentioned previously in our committee discussions the way that infrastructure decisions can affect the operation of other services. I mentioned before that we saw in the 1980s and 90s in the days of British Rail, a contraction of some of the infrastructure, including passing loops and stabling sidings, which were important to charter services. There were even instances where disagreements about cost attributions between different business sectors of British Rail ended up with routes being abandoned.
So I think this underlines the the important connection between decisions over infrastructure and the viability of different operators. I look forward to the debate on this group, and I beg to move. Amendment 230.
The. The duty on Great British Railways that the must duty to exercise its functions so as to ensure that it retains sufficient capacity over GBR infrastructure to allow for the operation of its own services and services that it expects will be its services in the future. And our amendment here relates to the need to accommodate other services in the infrastructure capacity plan that Great British Railways will be looking at. Capacity is already tightly constrained and in the case of heritage charter operators, as mentioned previously, the. The. The popular paths to the. On the North Yorkshire Moors to to Whitby.
The constraints over platform capacity as it affects the Polar Express at Euston, for instance. And there's nervousness that as capacity remains constrained, then other operators not just heritage railway operators, but. But other operators will be easy to squeeze, particularly in light of the duties in clause 63 and elsewhere on on GBR. More broadly, the bill, the access and use policy and the remarks that we've had so far are all set out in terms of managing existing capacity and identifying how it should be used, rather than envisaging how any additions and the story of our railways has been one of growth and innovation.
It might be helpful, I think, to hear from the noble Lord, the Minister, about how he sees additional capacity and new routes and new uses featuring in the the new landscape. And I've mentioned previously in our committee discussions the way that infrastructure decisions can affect the operation of other services. I mentioned before that we saw in the 1980s and 90s in the days of British Rail, a contraction of some of the infrastructure, including passing loops and stabling sidings, which were important to charter services. There were even instances where disagreements about cost attributions between different business sectors of British Rail ended up with routes being abandoned.
So I think this underlines the the important connection between decisions over infrastructure and the viability of different operators. I look forward to the debate on this group, and I beg to move. Amendment 230.
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Speaker 13
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Speaker 13
My Lords, my amendment 233 in this group is not about heritage railways, but I strongly support the efforts that the noble Lord, Lord Parkinson, has made to raise that issue on several occasions during the procedure. Ingeniously procedurally, I should say no amendments about a completely different subject. It's about timetables and the provision of information to the public about what trains are actually going to run and when they will run. It is extraordinary that we've reached a point where most or many operating companies simply do not publish or produce timetables, and you therefore dependent upon information obtained from station staff or the use of apps and websites on the telephone or iPad, which is often very impractical, many people find it a difficult method to use to get information about what trains are available, and people find it particularly difficult if they're rushing around, perhaps on a shopping trip to Edinburgh.
It's raining, there's a crowd in the street, and the only way to find out when the next train is, is to open the phone and find the appropriate site and garner the information from that. That results in a situation I'll come to in a moment. But in the meantime, I want to say that lNer on the East Coast mainline has actually produced a timetable. You might cheer at that point until you discover that it expired on the 16th of May 2026 and has not been replaced. Furthermore, when you look at it in more detail, you'll discover that it does not contain any trains of any other operators than lNer.
Even though when Eleanor reduced the service from stations like Berwick and Durham, they said it's not a problem because you'll be able to use connecting services to pick up our trains further down the line. Those connecting services are wholly absent from this timetable. Station staff at stations like Berwick get frequent requests from people saying I'm going to Edinburgh for the day, what time can I come home? What trains are there? I'm not sure what time I finished the business I'm doing in Edinburgh or the shopping trip in Edinburgh. So what do the staff do? They produce a timetable on their own initiative and I have it in my hand.
It's a strip of paper about six inches long and about an inch wide. It does tell you every train from Edinburgh, from all the different operators, but it's a desperate measure. It produced by staff who are not provided with the tools to keep the population of rail users properly informed. And this applies particularly on lines where services don't follow a regular clockface pattern, as is the case on most stations on the main line. I have discussed this with the minister a lengthy meeting some time ago, and I think he agrees with me that it's ludicrous to have timetables which include only one operator's trains when the journey.
Your journey may very well depend on two operators trains being involved. These things are thought to be about to disappear by magic. Once GBR is in place, all these conflicts and difficulties will evaporate, but I'm afraid they won't unless some provision is made for the public to be informed about when trains go. The amendment that I have offered is bells and whistles Rolls Royce version the timetable and I'm not. My case is not that we have to go back to the. The. The mammoth timetable volume, which I'm sure the noble Lord. The Minister always had a copy of long before he was in his present post, which give you every train on every line in the country.
I'd find that useful. But it's not what most people are after. Most people would want a more local timetable, but have no timetable at all, neither in the form that they can carry away, nor in the form of a poster on the station listing the train times. Very often when you're on the station, you don't just want to see the electronic display of the trains in the next hour. You want to see what trains are available later in the day. If you're making a journey, you don't necessarily simply want to get onto a website and find out that if your plan is to leave at 9:00, this is the train you get.
You might want to look at the timetable and think, is it feasible to stop off at York for a couple of hours and make a visit out of my day? All these sorts of things people did with the aid of local and regional timetables are not provided for. So my . The purposes of my amendment could be satisfied in a more limited form. But modern technology should enable GBR, who have to produce a working timetable anyway to make available a proper timetable to meet the needs of their customers. Its absence is a handicap to encouraging rail use.
It's raining, there's a crowd in the street, and the only way to find out when the next train is, is to open the phone and find the appropriate site and garner the information from that. That results in a situation I'll come to in a moment. But in the meantime, I want to say that lNer on the East Coast mainline has actually produced a timetable. You might cheer at that point until you discover that it expired on the 16th of May 2026 and has not been replaced. Furthermore, when you look at it in more detail, you'll discover that it does not contain any trains of any other operators than lNer.
Even though when Eleanor reduced the service from stations like Berwick and Durham, they said it's not a problem because you'll be able to use connecting services to pick up our trains further down the line. Those connecting services are wholly absent from this timetable. Station staff at stations like Berwick get frequent requests from people saying I'm going to Edinburgh for the day, what time can I come home? What trains are there? I'm not sure what time I finished the business I'm doing in Edinburgh or the shopping trip in Edinburgh. So what do the staff do? They produce a timetable on their own initiative and I have it in my hand.
It's a strip of paper about six inches long and about an inch wide. It does tell you every train from Edinburgh, from all the different operators, but it's a desperate measure. It produced by staff who are not provided with the tools to keep the population of rail users properly informed. And this applies particularly on lines where services don't follow a regular clockface pattern, as is the case on most stations on the main line. I have discussed this with the minister a lengthy meeting some time ago, and I think he agrees with me that it's ludicrous to have timetables which include only one operator's trains when the journey.
Your journey may very well depend on two operators trains being involved. These things are thought to be about to disappear by magic. Once GBR is in place, all these conflicts and difficulties will evaporate, but I'm afraid they won't unless some provision is made for the public to be informed about when trains go. The amendment that I have offered is bells and whistles Rolls Royce version the timetable and I'm not. My case is not that we have to go back to the. The. The mammoth timetable volume, which I'm sure the noble Lord. The Minister always had a copy of long before he was in his present post, which give you every train on every line in the country.
I'd find that useful. But it's not what most people are after. Most people would want a more local timetable, but have no timetable at all, neither in the form that they can carry away, nor in the form of a poster on the station listing the train times. Very often when you're on the station, you don't just want to see the electronic display of the trains in the next hour. You want to see what trains are available later in the day. If you're making a journey, you don't necessarily simply want to get onto a website and find out that if your plan is to leave at 9:00, this is the train you get.
You might want to look at the timetable and think, is it feasible to stop off at York for a couple of hours and make a visit out of my day? All these sorts of things people did with the aid of local and regional timetables are not provided for. So my . The purposes of my amendment could be satisfied in a more limited form. But modern technology should enable GBR, who have to produce a working timetable anyway to make available a proper timetable to meet the needs of their customers. Its absence is a handicap to encouraging rail use.
18:25
18:25
Speaker 12
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Speaker 12
My Lords, I'll just speak relatively briefly to this group since we covered some of these issues on the previous group. And I'll reiterate my congratulations, Lord Parkinson, but I won't repeat my. Praise for Dean Forest Railway. Apart from just mentioning it, I just wanted to reference two amendments in this group. So amendment 231 in the name of my noble friend Lord Moylan, I think is very valuable because at the moment. So what it does is it says that when GBR is producing the infrastructure capacity plan, it actually has to consult people in producing it. At the moment, the drafting of the the clause says GBR must issue the documents setting out, in its view, how it can make best use of its infrastructure.
It says that when it prepares, revises or replaces it, it must have regard to the need to accommodate its passenger services. Other passenger services, services for the carriage of goods, and the maintenance and improvement of GBR infrastructure. I just note, by the way, that it always lists GBR passenger services first, which again may not mean anything legally, but mentally does rather suggest to people that that is the order in which it's going to prioritise railway services, because that is the order in which it is listed. And when you do list, people tend to put the important things at the top.
So that will just make people think. As the noble Lord, Lord Tunnicliffe said, that that's how GBR is going to allocate it. But at the moment it just says it produces a document which is its views. It doesn't say it has to consult anybody at all. And I think my noble friend Lord Moylan's amendment, which says that it's actually got to consult and have regard to the views of the other railway passenger services and services that it's referencing, I think is very valuable and I think will be welcome to those operators, because it means that when it's producing the infrastructure capacity plan, it's actually got to talk to them and listen to them.
Seriously, the other amendment that I just wanted to touch on briefly was amendment 234. Again, another one from my noble friend Lord Moylan. It effectively it it replaces part of clause 63 and effectively it deals with the the at least partially the issue that I raised when we were discussing clause 63 in the last group, because what it does is it removes GBR s ability to. Preference its own services, and it. It refers equally to freight open access operators and in its own services, and it stops it being able to reserve capacity for the future.
And I think that's welcome. As I said, I'm not particularly wedded to the particular form of words that my noble friend has tabled. If the minister, as I said, when he does his reflection that he referred to in the last group, if he wants to come back with something different, that's fine. But I think this is a helpful starter for ten, as it were, in dealing with some concerns that I, my noble friend Lord Young of Cookham and Lord Lansley, raised in the last group about clause 63, and I hope the minister, when he does his reflecting on this, this group and this issue, looks at those amendments that my noble friends tabled with an open mind.
It says that when it prepares, revises or replaces it, it must have regard to the need to accommodate its passenger services. Other passenger services, services for the carriage of goods, and the maintenance and improvement of GBR infrastructure. I just note, by the way, that it always lists GBR passenger services first, which again may not mean anything legally, but mentally does rather suggest to people that that is the order in which it's going to prioritise railway services, because that is the order in which it is listed. And when you do list, people tend to put the important things at the top.
So that will just make people think. As the noble Lord, Lord Tunnicliffe said, that that's how GBR is going to allocate it. But at the moment it just says it produces a document which is its views. It doesn't say it has to consult anybody at all. And I think my noble friend Lord Moylan's amendment, which says that it's actually got to consult and have regard to the views of the other railway passenger services and services that it's referencing, I think is very valuable and I think will be welcome to those operators, because it means that when it's producing the infrastructure capacity plan, it's actually got to talk to them and listen to them.
Seriously, the other amendment that I just wanted to touch on briefly was amendment 234. Again, another one from my noble friend Lord Moylan. It effectively it it replaces part of clause 63 and effectively it deals with the the at least partially the issue that I raised when we were discussing clause 63 in the last group, because what it does is it removes GBR s ability to. Preference its own services, and it. It refers equally to freight open access operators and in its own services, and it stops it being able to reserve capacity for the future.
And I think that's welcome. As I said, I'm not particularly wedded to the particular form of words that my noble friend has tabled. If the minister, as I said, when he does his reflection that he referred to in the last group, if he wants to come back with something different, that's fine. But I think this is a helpful starter for ten, as it were, in dealing with some concerns that I, my noble friend Lord Young of Cookham and Lord Lansley, raised in the last group about clause 63, and I hope the minister, when he does his reflecting on this, this group and this issue, looks at those amendments that my noble friends tabled with an open mind.
18:28
Speaker 3
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Speaker 3
My Lords, the. The references to timetables from noble Lord, Lord Beith is one with which I have the most enormous sympathy. When my late brother died he left me an extraordinary collection of Bradshaw's. Not after his noble friend in the Liberal Democrat Party, but a founder of an institution which lasted until 1960. There have been various attempts since to produce all line timetables, and indeed, it is possible to find one produced by Network Rail online. But it isn't the same as the as the bound book, which, as he said, contained every train running on every day.
Well, in theory, running on every day. One of the difficulties about using it is that the reality of the timetable sometimes wasn't matched by the reality of the railway, which actually takes me to the main point I want to make, and that is that the one argument it is coming through from this debate and and on the previous group, is the utterly important role of Great British Railways as the directing mind. In opening statement. Referred to the infamous oh 700 from Manchester.
Well, in theory, running on every day. One of the difficulties about using it is that the reality of the timetable sometimes wasn't matched by the reality of the railway, which actually takes me to the main point I want to make, and that is that the one argument it is coming through from this debate and and on the previous group, is the utterly important role of Great British Railways as the directing mind. In opening statement. Referred to the infamous oh 700 from Manchester.
18:30
18:30
Speaker 3
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Speaker 3
Which for a few days only happily ran without passengers entirely for the benefit of Network Rail and not for the benefit of any of the customers of the railway. It did remind me of some of the scurrilous things that used to be said when I was working for the Railways Board in the 1970s and 1980s, and that was how much easier it would be to run a railway without any passengers on it. Anyway. Life. Life imitating art. In the case of the zero 700 from Manchester. But my noble friend, who doesn't often get the credit for this, I know , intervened and bang heads together and impossible for him to run in the timetable with real people being carried on it.
But the all the decisions that we're talking about, access of access for heritage railways, access for freight access for other operators will depends on there being a proper directing mind, which can determine the allocations of allocations from network network and make the best use of it. It's not a question of giving preference to their services first. They are, after all, the great public asset, which is going to be receiving very substantial amounts of public money, and it would be mad for the government to run the risk of that revenue being lost because of some of it, some of it being some of it being siphoned away by other operators.
And that does include, I'm afraid, sometimes the open access operators who role I warmly welcome, not least because they have encouraged more people to travel by train than otherwise would be the case. But it mustn't be at the expense of the core railway. And it's the core railway which I looked at to GBR to be to provide and manage and I hope, bring the various factions together.
But the all the decisions that we're talking about, access of access for heritage railways, access for freight access for other operators will depends on there being a proper directing mind, which can determine the allocations of allocations from network network and make the best use of it. It's not a question of giving preference to their services first. They are, after all, the great public asset, which is going to be receiving very substantial amounts of public money, and it would be mad for the government to run the risk of that revenue being lost because of some of it, some of it being some of it being siphoned away by other operators.
And that does include, I'm afraid, sometimes the open access operators who role I warmly welcome, not least because they have encouraged more people to travel by train than otherwise would be the case. But it mustn't be at the expense of the core railway. And it's the core railway which I looked at to GBR to be to provide and manage and I hope, bring the various factions together.
18:32
Speaker 16
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Speaker 16
My Lords, I shall not detain the Committee very long. But just to apologise for speaking to various amendments two, three, two, two, three eight and two, three, nine relating to freight. And I trust that my noble friend will be able to respond positively to the issue, the issues and the questions which I've asked.
18:33
Speaker 14
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Speaker 14
My Lords, my amendment two, three, six in this group requires Great British Railways to retain sufficient capacity over Great British Railways infrastructure to not only operate passenger rail services, which is important, and to carry out works to maintain and improve the infrastructure, but also to meet its freight target as set out in clause 17. I have to say, reading the legislation, it does feel like an obvious gap given freight has featured so heavily in our debates at committee stage, and there is an ambition to grow freight. Yet it's not set out explicitly in clause 63.
I hope the noble Lord, the minister, will respond positively to that amendment. My noble friend Lord Beith has set out his desire to see a proper timetable available easily for all passengers, and even bought props with him, which I haven't seen for some time on the railway. But I have to say , I think he's right. The accuracy of timetables is critical for people to have confidence in using the railways and with technology now, certainly some years ago you used to be able to, on one of the train operators websites, design your own bespoke timetable between which station you lived at and where you wanted to go, maybe your regular commute and you could print it off.
So it just had those stations and all the time. I'm sure with technology now, that is still possible. And maybe that's something that Great British Railways may want to consider as part of their online offer. I look forward to the minister's response to this group of amendments.
I hope the noble Lord, the minister, will respond positively to that amendment. My noble friend Lord Beith has set out his desire to see a proper timetable available easily for all passengers, and even bought props with him, which I haven't seen for some time on the railway. But I have to say , I think he's right. The accuracy of timetables is critical for people to have confidence in using the railways and with technology now, certainly some years ago you used to be able to, on one of the train operators websites, design your own bespoke timetable between which station you lived at and where you wanted to go, maybe your regular commute and you could print it off.
So it just had those stations and all the time. I'm sure with technology now, that is still possible. And maybe that's something that Great British Railways may want to consider as part of their online offer. I look forward to the minister's response to this group of amendments.
18:34
Speaker 9
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Speaker 9
My Lords, I can afford to be fairly brief because most of my amendments in this group have been spoken to already by my noble friends. Amendment 231 requires consultation with the freight industry on the infrastructure capacity, on the plan. I don't need to elaborate further on that. Amendments two, three, four and two, three, seven have been given a new twist by the noble Lord, the minister in the previous group redefining what the reference to a great British Rail, what the reference to a GBR passenger service meant. That will require some reflection and no doubt we'll return to this on report, but there's little point belaboring it now, since the noble Lord, I think I know what the noble Lord is going to say because you said it already.
Amendment 235 , also in my name seeks the tie. It was linked to amendment 124, which brought debated. It seeks to tie Great British Railways when allocating capacity to an obligation to meet its key performance indicators. But of course, the noble Lord doesn't want key performance indicators. So that's now another tip. So that's really all I have to say. Could I make a comment on the remarks made by the noble Lord, Lord Faulkner of Worcester? And that is to say that I think everyone agrees. And the noble Lord, the minister has made a good case that the allocation of capacity should be centralised and made by people who know what they're doing in the interests of optimizing the use of an expensive piece of infrastructure.
But he hasn't answered the challenge. He maybe the noble Lord, Lord Faulkner, doesn't feel he has to answer challenges that come from here, but he hasn't answered the challenge as to why that needs to be. Inside an organisation which is providing passenger rail services. That is the nub of the of the evils that this bill is creating in terms of multiple, multiple conflicts of interest. And that's what won't go away. So I just leave that thought that he needs if he wants to persuade this side of the of the committee of what of his view that this should be supported.
He needs to to go on and address that perhaps on another occasion. I don't mean that in any sense rudely or challengingly. I'm just trying to explain why it is that we are not satisfied with that as an answer. And before I sit down, you may want to say something.
Amendment 235 , also in my name seeks the tie. It was linked to amendment 124, which brought debated. It seeks to tie Great British Railways when allocating capacity to an obligation to meet its key performance indicators. But of course, the noble Lord doesn't want key performance indicators. So that's now another tip. So that's really all I have to say. Could I make a comment on the remarks made by the noble Lord, Lord Faulkner of Worcester? And that is to say that I think everyone agrees. And the noble Lord, the minister has made a good case that the allocation of capacity should be centralised and made by people who know what they're doing in the interests of optimizing the use of an expensive piece of infrastructure.
But he hasn't answered the challenge. He maybe the noble Lord, Lord Faulkner, doesn't feel he has to answer challenges that come from here, but he hasn't answered the challenge as to why that needs to be. Inside an organisation which is providing passenger rail services. That is the nub of the of the evils that this bill is creating in terms of multiple, multiple conflicts of interest. And that's what won't go away. So I just leave that thought that he needs if he wants to persuade this side of the of the committee of what of his view that this should be supported.
He needs to to go on and address that perhaps on another occasion. I don't mean that in any sense rudely or challengingly. I'm just trying to explain why it is that we are not satisfied with that as an answer. And before I sit down, you may want to say something.
18:37
18:37
Speaker 9
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Speaker 9
My Lords, this takes us back to all the way back to 2024. Actually, when we spoke on the passenger of an iceberg on the Passenger Rail Services bill, the present arrangement I have already said, involving franchise services has flaws. It had flaws, in my view, that were systematic and built in from the beginning, but they didn't become apparent because the growth in passenger numbers and the revenue generated masked them to some extent. They were becoming apparent in the years leading up to the Covid pandemic, and they were thoroughly exposed, of course, and shattered by the effects of the pandemic.
And I have never said a word in this in your lordships House or in this committee, suggesting that the existing system be preserved so that that is a petard, if that's the correct expression on which I'm not going to be hoist. And that is how I meet the noble Lords challenge. But as my noble friend Lord Harper, as Mr. Keith Williams and as others have said, there are alternative methods to eliminating the evils of that system which do not create the vast internal conflicts of interest which are created by the measure proposed by the government.
And it is those conflicts of interest that are, in my view, unnecessary on a slightly different model, and which are the reason why the comments that the noble Lord made welcome, though they were, and made in good faith as they were, I'm not challenging any of that are not sufficient to satisfy this side of the committee. That's all I meant.
And I have never said a word in this in your lordships House or in this committee, suggesting that the existing system be preserved so that that is a petard, if that's the correct expression on which I'm not going to be hoist. And that is how I meet the noble Lords challenge. But as my noble friend Lord Harper, as Mr. Keith Williams and as others have said, there are alternative methods to eliminating the evils of that system which do not create the vast internal conflicts of interest which are created by the measure proposed by the government.
And it is those conflicts of interest that are, in my view, unnecessary on a slightly different model, and which are the reason why the comments that the noble Lord made welcome, though they were, and made in good faith as they were, I'm not challenging any of that are not sufficient to satisfy this side of the committee. That's all I meant.
18:39
Speaker 12
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Speaker 12
Just before my noble friend sits down, can I just add something to the point he's made? The noble Lord, Lord Faulkner of Worcester, I think, in the same way Lord Tunnicliffe did, illustrated one of the points when he talked about the what is called abstraction of revenue from other operators against the GBR services. That is, if I may say so. It's not meant as an insult. That is very much the Treasury's view. And so my worry and the worry of the other operators is that is exactly what will happen. The Treasury's view is anybody that operates rail services that compete with the GBR ones is basically stealing their money, and that will inevitably shape the decisions that are taken.
That is the concern that people have, and that is the conflict. I think that my noble friend refers to that needs to be dealt with, and it's exacerbated.
That is the concern that people have, and that is the conflict. I think that my noble friend refers to that needs to be dealt with, and it's exacerbated.
18:40
18:40
18:40
Speaker 7
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Speaker 7
My Lords. I'm grateful to my noble friend Lord Faulkner for for supporting the premise that we need a directive, a directing mind for the railway, and I won't. I hope I won't prolong the previous discussion, but only to say that it. It. It can be only GBR as the principal operator who has the expertise to decide how best to use the infrastructure. how expertise. Transfer that into a plan for its better enhancement, which we haven't had for 30 years and which has resulted in in parts of the railway being far too full, not being able to support any further trains who whoever operates them, and a sizeable amount of money going to schemes which are which are perfectly welcome but are suboptimal use of a use of funding for a very.
I think I will try not to repeat all of the opening statement that I made in the Committee was patient enough to listen to, other than to say that this is, again, about the infrastructure capacity plan and clause 60. I did note that Lord Harper suggested that the list that was set out in clause 60 might, might somehow be be in some particular order. All I'd say is, firstly, that you can't refer to other operators until you've referred to the principal operator of passenger services. So there is some logic in it. But I will say to him that we will clarify the fact that that list is not in any preference order in the explanatory notes, because I'm as keen as other people are to show that actually this process is designed to be to be fair, fair to, to to be, to be fair and open, I don't I think I also think, for what it's worth, that were the years of expertise in, in the order to be to have been shown to be useful.
They were certainly seriously damaged by the by the the O 700 Piccadilly to Euston experience where the, where the the the regulator was was definitive about that not being capable of being run, despite the fact that both its operator and the infrastructure owner said it should be. And it's running today and it runs perfectly satisfactorily from time to time. I look at it running to see whether it to see, to see whether it runs to time. And it does, because it would have run anyway. Yeah. And, and that's the sort of thing that we're trying to, we're trying to, to stop here.
I don't I also think that I will be brief on amendment 230 from the noble Lord Parkinson. He's made his he's made his case very well. I think the reference in clause 60 to other railway passenger services, for the avoidance of doubt and for the record, does refer to all non GBR services that carry passengers, including those of charter and heritage Services and including those on the main line to to the degree they're on the main line. And I would say to him, because he's referred to it, and I know that there is a particular worry in that direction that those operators who have regular train paths, I'm quite determined that they are dealt with in the same way in clause 60 as others, because they need they're operating them because they provide a public service and a purpose.
And to some extent they provide income to heritage railways. And I'm absolutely determined that they should continue, which is why, which is why it's referred to in that way. But I do, as I said, think that also there's something more to be said about all that in the O P and the more the clearer his letter is, the more delighted I will be to support it. Turning to amendment 231, where GBR issues, amends or replaces a plan clause 662 I already requires GBR to consult such persons as it considers appropriate and as I've said in our previous group, the O.
P makes it clear that GBR will consult parties who both who hold track access contracts and parties that have registered with GBR and prospective applicants. And it's also important to note that word GBR to alter a capacity plan without undertaking the required consultation, it would be acting in breach of its statutory obligations under under the Bill, and such a failure would provide affected parties with strong grounds to appeal to the IRR. Turning to amendments two, three, two and two, three, three, the Bill is clear about the basis on which GBR will prepare the working timetable.
As with the ICP, GBR must comply with its statutory duties, including having regard to the freight growth target in clause 17 when developing and producing the working timetable, and will need to take account of the ICP as a whole to the access and use policy. As you've already heard, as noble Lords have already heard, establishes a transparent framework for resolving completing timetable demands for timetable paths, and it therefore provides the clarity that my noble friend Lord Barclay seeks in amendment 232. In addition, the. The Access and Use policy confirms that these timetabling decisions will continue to be subject to a contractual dispute resolution mechanism as they are today, providing a route to resolve those detailed disputes before resorting to an appeal process.
Taken together, these provisions provide clear and robust safeguards for timetable decisions. Amendment 233 the the provisions in the Bill are principally concerned with the development of the working timetable for the railway industry. They provide the foundation on which passenger timetable information will be produced and made available, and following a productive meeting with the noble Lord, I committed to undertaking some further research on the availability, on the availability of route based national timetables for passengers. I am pleased to confirm that the National Railway Timetable is available electronically via Network Rail's website. I expect the accessible provision of information to access enable passengers to plan their journeys to continue under GBR.
That timetable includes route by route timetables and services provided by all passenger operators, which is, I think, what the noble Lord wants to see. But having had significant difficulty in finding it myself on their website, I will raise with Network Rail how we can much better signpost passengers easily to access this information more effectively, because I completely agree with him that prospective passengers would like to see all the passenger services provided by every operator from station, from one station to another, and it ought to be more easily available than it than it is. I would say to him, I only keep one train timetable at home.
I got rid of all the old great British Railway timetables because they're all like door stops I keep. The only one I keep is the last great Western timetable from December 1947, and I delight in the fact that the Great Western Railway decided on all the timetabling changes on its railway because it was in charge of it. And that's the right way that we should do this.
I think I will try not to repeat all of the opening statement that I made in the Committee was patient enough to listen to, other than to say that this is, again, about the infrastructure capacity plan and clause 60. I did note that Lord Harper suggested that the list that was set out in clause 60 might, might somehow be be in some particular order. All I'd say is, firstly, that you can't refer to other operators until you've referred to the principal operator of passenger services. So there is some logic in it. But I will say to him that we will clarify the fact that that list is not in any preference order in the explanatory notes, because I'm as keen as other people are to show that actually this process is designed to be to be fair, fair to, to to be, to be fair and open, I don't I think I also think, for what it's worth, that were the years of expertise in, in the order to be to have been shown to be useful.
They were certainly seriously damaged by the by the the O 700 Piccadilly to Euston experience where the, where the the the regulator was was definitive about that not being capable of being run, despite the fact that both its operator and the infrastructure owner said it should be. And it's running today and it runs perfectly satisfactorily from time to time. I look at it running to see whether it to see, to see whether it runs to time. And it does, because it would have run anyway. Yeah. And, and that's the sort of thing that we're trying to, we're trying to, to stop here.
I don't I also think that I will be brief on amendment 230 from the noble Lord Parkinson. He's made his he's made his case very well. I think the reference in clause 60 to other railway passenger services, for the avoidance of doubt and for the record, does refer to all non GBR services that carry passengers, including those of charter and heritage Services and including those on the main line to to the degree they're on the main line. And I would say to him, because he's referred to it, and I know that there is a particular worry in that direction that those operators who have regular train paths, I'm quite determined that they are dealt with in the same way in clause 60 as others, because they need they're operating them because they provide a public service and a purpose.
And to some extent they provide income to heritage railways. And I'm absolutely determined that they should continue, which is why, which is why it's referred to in that way. But I do, as I said, think that also there's something more to be said about all that in the O P and the more the clearer his letter is, the more delighted I will be to support it. Turning to amendment 231, where GBR issues, amends or replaces a plan clause 662 I already requires GBR to consult such persons as it considers appropriate and as I've said in our previous group, the O.
P makes it clear that GBR will consult parties who both who hold track access contracts and parties that have registered with GBR and prospective applicants. And it's also important to note that word GBR to alter a capacity plan without undertaking the required consultation, it would be acting in breach of its statutory obligations under under the Bill, and such a failure would provide affected parties with strong grounds to appeal to the IRR. Turning to amendments two, three, two and two, three, three, the Bill is clear about the basis on which GBR will prepare the working timetable.
As with the ICP, GBR must comply with its statutory duties, including having regard to the freight growth target in clause 17 when developing and producing the working timetable, and will need to take account of the ICP as a whole to the access and use policy. As you've already heard, as noble Lords have already heard, establishes a transparent framework for resolving completing timetable demands for timetable paths, and it therefore provides the clarity that my noble friend Lord Barclay seeks in amendment 232. In addition, the. The Access and Use policy confirms that these timetabling decisions will continue to be subject to a contractual dispute resolution mechanism as they are today, providing a route to resolve those detailed disputes before resorting to an appeal process.
Taken together, these provisions provide clear and robust safeguards for timetable decisions. Amendment 233 the the provisions in the Bill are principally concerned with the development of the working timetable for the railway industry. They provide the foundation on which passenger timetable information will be produced and made available, and following a productive meeting with the noble Lord, I committed to undertaking some further research on the availability, on the availability of route based national timetables for passengers. I am pleased to confirm that the National Railway Timetable is available electronically via Network Rail's website. I expect the accessible provision of information to access enable passengers to plan their journeys to continue under GBR.
That timetable includes route by route timetables and services provided by all passenger operators, which is, I think, what the noble Lord wants to see. But having had significant difficulty in finding it myself on their website, I will raise with Network Rail how we can much better signpost passengers easily to access this information more effectively, because I completely agree with him that prospective passengers would like to see all the passenger services provided by every operator from station, from one station to another, and it ought to be more easily available than it than it is. I would say to him, I only keep one train timetable at home.
I got rid of all the old great British Railway timetables because they're all like door stops I keep. The only one I keep is the last great Western timetable from December 1947, and I delight in the fact that the Great Western Railway decided on all the timetabling changes on its railway because it was in charge of it. And that's the right way that we should do this.
18:48
18:48
18:48
Speaker 3
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Speaker 3
At the time is you aware of the Cotswold Line promotion Group, of which I have the honour to be president at its own expense, produces a timetable for the route between Paddington, Oxford, Worcester and Hereford. It is produced with, in cooperation the Great Western Railway, the present operator, and we hope it will be with a new operator and that is distributed for members with their magazine and it is made freely available at stations. It's made for no charge and it costs about £500 a year.
18:48
Speaker 7
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Speaker 7
To hear it. And I hope that . I mean, one of the things that we need for the future is for as many people as possible to understand the totality of train passenger train services on the network, whoever operates them, in order to sustain the maximum number of passengers, in order to justify a very expensive set of infrastructure.
18:49
Speaker 13
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Speaker 13
For the minister , leaves the subject. Well, if you'd allow me first of all to say I'm glad he's still working on it and working on those things which are supposed to be available that are very difficult to find. But does he recognise that in addition to what can be made available online, it is beneficial, as the noble Lord has just illustrated? Lord Faulkner. If alternative means can be used to make timetables available, which people can carry around with them, can compare with others and provide a useful aid to discovering when trains are available for them, and that there should be some encouragement.
If GBR doesn't produce them itself, it should surely encourage the kind of enterprise which Lord Faulkner has described.
If GBR doesn't produce them itself, it should surely encourage the kind of enterprise which Lord Faulkner has described.
18:49
Speaker 7
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Speaker 7
The noble Lord hits on a very on a very useful topic, which is that one of the things that we are trying to do here, and we will do, is to remove the massive inconsistency in information between different train operators on the network. And I, and I very much sympathise with with his view, if you were to try to collect the published information from all the train operators in Britain, it would come in a variety of sizes booklets, pieces of paper. Some of it isn't available, as is remarked, and one of the things that we must do is to rationalise this so that people know where to find this stuff, that it's comprehensive and wherever you're looking, whether it's for a journey from Penzance or a journey from Berwick on Tweed, it comes in a format that you can understand it, and I totally sympathise with him, and that is one of the reasons why we're setting up GBR, because the inconsistency between operators is is unsatisfactory.
Turning to amendments two, three, 4 to 2, three, nine and clause 63 stand part I. I hope that I've already made the case that the purpose of clause 63 is straightforward, and I don't I don't feel that that it's the best use of the committee's time for me to reiterate yet again, that it does not in any way undermine the requirement in clause 60 to determine the best use of of the network. I will I will leave it at that, other than to say to the noble Baroness Pigeon that that that that the. When the GBR is deciding on the best use of the network under its infrastructure capacity plan at clause 60, it will have to take into account its statutory duties at clauses 16 to 18, and that will include its duty to promote freight and have regard to the freight growth target.
And indeed, if it doesn't do that, A we won't satisfy the freight group, the freight growth target, but actually it. If it weren't to do it, then clearly clause 60 wouldn't be working in the way that it was intended and focus first to complain and, and, and, and appeal about it. And having prepared that plan, GBR can't simply ignore it. The, the, the infrastructure capacity plan informs the contract between the Secretary of State and GBR, and once agreed that contract, in turn determines the passenger services for which capacity should be retained under must be retained under clause clause 63.
Turning to amendments two, three, 4 to 2, three, nine and clause 63 stand part I. I hope that I've already made the case that the purpose of clause 63 is straightforward, and I don't I don't feel that that it's the best use of the committee's time for me to reiterate yet again, that it does not in any way undermine the requirement in clause 60 to determine the best use of of the network. I will I will leave it at that, other than to say to the noble Baroness Pigeon that that that that the. When the GBR is deciding on the best use of the network under its infrastructure capacity plan at clause 60, it will have to take into account its statutory duties at clauses 16 to 18, and that will include its duty to promote freight and have regard to the freight growth target.
And indeed, if it doesn't do that, A we won't satisfy the freight group, the freight growth target, but actually it. If it weren't to do it, then clearly clause 60 wouldn't be working in the way that it was intended and focus first to complain and, and, and, and appeal about it. And having prepared that plan, GBR can't simply ignore it. The, the, the infrastructure capacity plan informs the contract between the Secretary of State and GBR, and once agreed that contract, in turn determines the passenger services for which capacity should be retained under must be retained under clause clause 63.
18:52
Speaker 9
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Speaker 9
May I briefly, will the noble Lord acknowledge that having regard to is the lowest form of obligation, legal obligation that can be imposed on a public body? Those of us with local government experience have come across, you know, language such as in general conformity with which is higher or in conformity, which is even more even higher or comply with which is higher still, but have regard to, as the noble Lord himself has explained, simply means you have to look at it in the right way, for the right amount of time, and show that you've thought about it.
It isn't very convincing to those who are concerned about it. Include the noble Baroness, but also the wider freight industry and other users of.
It isn't very convincing to those who are concerned about it. Include the noble Baroness, but also the wider freight industry and other users of.
18:53
Speaker 7
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Speaker 7
I would say, in response to the noble Lord, this. Which is that actually the the the consideration indeed, other sorts of services on the differ in accordance with time and location. So actually GBR does have a pretty serious job to do. But the reason why the freight growth target is enshrined in this legislation more than once is to emphasise the need to. That the need to.
18:53
18:53
Speaker 7
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Speaker 7
It, the the, the need to to, to grow freight. And I think that the I think the provisions of clause 60 are quite sufficient to make sure that GBR, when it needs to, will make that provision because it won't need to make the same provision everywhere. And indeed, the freight operators will know that there are some parts of the network that they that they don't serve and never serve. And there are other parts where capacity is sorely needed and isn't currently available. I'll just finish by saying that transparency, which the noble Lord, my noble friend Lord Berkeley raised is, is baked into this process.
The Access and Use policy on page 14 commits GBR to publishing its decisions together with clear rationale, explaining how the why the decision was reached and how it reflects GBR statutory duties and decision making criteria. And that's a further reason to be reassured about the freight growth target, because those who are seeking to operate either the existing volumes of freight or the future volumes of freight, will be looking very carefully to make sure that GBR does prioritise freight growth where it needs to in order to expand that market.
The Access and Use policy on page 14 commits GBR to publishing its decisions together with clear rationale, explaining how the why the decision was reached and how it reflects GBR statutory duties and decision making criteria. And that's a further reason to be reassured about the freight growth target, because those who are seeking to operate either the existing volumes of freight or the future volumes of freight, will be looking very carefully to make sure that GBR does prioritise freight growth where it needs to in order to expand that market.
18:54
Speaker 8
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Speaker 8
Again, I'm grateful to the noble Lord, the Minister, for his responses, particularly the helpful clarification that the reference at clause 60 sub clause four be to other railway passenger services includes the Heritage Charter operators. As he mentioned. Associate myself with the remarks. My friend Lord Moylan that have regard to is not a binding guarantee, but it is. It's helpful to know that that reference there does bring those operators in. So while I look forward to the further debates that we'll have in this area, I am happy to withdraw my amendment 230.
18:55
Speaker 15
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Speaker 15
This amendment be withdrawn. The amendment is by leave withdrawn. Amendment 231 Lord Moylan. not moved. Moved. The question is clause 60 stand part of the bill as manager of that opinion will say content the contrary not content. The contents have it in clause 61. Amendment 232. Lord Berkeley. Not moved.
18:56
18:56
18:56
18:56
Speaker 15
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Speaker 15
The contrary not content. The contents have it after clause 62, amendment 233. Lord moved, moved in. Clause 63. Amendment 234. Lord Moylan not moved and Moylan not moved. Amendment 236. Baroness Pidgeon not moved. Amendment 237. Lord Moylan not moved and 200. Amendment 238. Lord Berkeley moved, moved and 239 Lord Berkeley.
18:56
18:56
Speaker 15
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Speaker 15
Not moved. And the question is that clause 63 stand part of the bill, as many of that opinion will say, content. present contrary, not content. The contents have it in clause 64, amendment 240. Lord Moylan, I should advise the Committee that if this amendment were to be agreed, I wouldn't be able to call amendment 241.
18:57
Speaker 9
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Speaker 9
My Lords, we're trespassing, I think, into what might be quickly. Newer ground, having broadly been discussing similar subjects so far in relation to access. Some of these amendments might appear to be a little trivial and or at least, shall we say, technical, but they're of importance to the freight industry in particular, but also to other users of the network. So if I could start with my amendment number 240, this relates to charging and in particular to charging for non-use of, so to speak, of, of booked slots. There is already provision in the for a reservation charge under the existing 2016 regulations.
This amendment eliminates it, but it's purely for probing purposes to establish what the government's plans are, because there's considerable uncertainty, not least in the freight sector for freight. For freight operators whose services are often driven by customer demand demand and cannot always be predicted with the same certainty as passenger services. So a charge for non-use is something which clearly has a commercial effect on them. And the question is what the government intends to do over and above existing practice. When the government is both a player and has a financial interest. Again, it's one of those conflicts of interest which is being baked into the system, which doesn't exist at the moment.
It's one of those conflicts of interest being baked into the system that doesn't exist at the moment, when the government is a player and has a financial interest and it needs to explain itself, tie itself down and give some account and and be under some sort of supervision. In my view. Amendment 241 has a slightly converse effect. It prevents non-operation charges applying where the train could not operate because the GB of a GBR infrastructure failure, or because GBR took the capacity for engineering or other network activities and work. So what it does again is prevent GBR making a cancellation charge for trains that do not operate for that reason.
Again, it's a probing amendment seeking clarity, which might lead to a substantive amendment on report. When we get to that, that point. If I come then to amendment two, four, three and two for amendments two, four, three and two, four, six, this is a very worrying clause. Two, four, three. The amendment to the bill gives. The bill obliges GBR to create a scheme of access charges, but also gives to GBR the power to increase those charges in certain circumstances. Now, in the past, that power to increase the charges has been driven by. What the market, sorry, what the market can bear, but now it is to be changed so as to work out, to relate to what an efficient operator can bear.
Now this is a very, very different thing. First of all, it requires GBR to have a capacity wholly absent at the moment to to know what an efficient operator can afford to pay. This is a large economic analytical undertaking. We know that because we have regulators who deal with who have to answer the question whether something is being operated efficiently in the water sector. We had it under the London Underground, p p p , we have it in other utility sectors, and there are considerable skills, techniques and models that have been generated over the years that require this.
It is not a light undertaking to establish efficient operation. So the first thing is how is GB are going to work it out. The second is why should GBR be able to increase charges simply because they think that an efficient operator could pay them? The assumption would be that they consider the existing operator to be inefficient, maybe because it's meeting passenger demand in a different way, and that they can force up the prices to require a change in behaviour. I suppose that's what they might be trying to do. But the, the my my first question is how do they even know how to work it out?
And why should they have the power? It is a source of very considerable concern to the freight sector and others. So it raises a very important point. Amendment two, four, six relates to it. The Commission detailed work on future access charging, which considered the legal framework economic principles, incentives created by different charging structures, the recovery of infrastructure costs, impacts on passengers and freight markets, and the trade offs between efficiency, competition, investment and cost recovery. Now the author did that work? They're being taken out of it. They won't have a say in these matters any more.
Can the minister tell us whether the author will be expected to apply these principles when deciding appeals on efficient operator? Will the government be applying these principles? How is the government going to approach this question of establishing what an efficient operator is? Where are the skills going to be? Was my first question. What are the principles on which the exercise will be conducted? Is my second question on amendment 245. Under the current system, major charging changes are normally dealt with through the five year periodic review, giving operators notice and certainty in advance. Clause 64, however, allows GBR to revise or replace its charging scheme at any time.
If that flexibility is to remain, there should be at least a minimum notice period, which my amendment requires. 12 months seems entirely reasonable for businesses making long term investment and operating decisions. Sometimes I think GBR forgets that the people who are using the network, who are the 25% of train movements, if even if we if we leave the heritage sector out of it, are private businesses concerned with making private investments, which can only be recovered over the long term, they cannot be messed about with by sudden changes to pricing models. Now, if the minister thinks another notice period, not 12 months or something else is appropriate, I'm very happy to have a discussion about what it should be, but it surely cannot be at no notice on two, four, eight and 249.
Clause 65 expressly protects GBR from having to make payments where disruption is outside its control, but there is no equivalent protection on the face of the bill for freight or open access operators. Now, the government may say that those operators would not normally be penalised when they did not cause the disruption. If that's the case, why not say so clearly in the Bill? If protection from events outside one's control is right for GBR, the same principle should apply to every operator operator using the network. I mean, one thinks of a case where a train becomes derailed, a freight train might become derailed, causing congestion and disruption.
But it is nobody's fault if you see what I mean or fault has to be established. Should there be a charge for that or not? What is the system going to be? People need to know two, four, seven and 250. The government should be laying the charging scheme before Parliament and the measure should not commence until we can scrutinise it, giving its importance. And amendment 250 is is is is is is in my view simply a drafting improvement.
My Lords, with that I beg leave to move it.
This amendment eliminates it, but it's purely for probing purposes to establish what the government's plans are, because there's considerable uncertainty, not least in the freight sector for freight. For freight operators whose services are often driven by customer demand demand and cannot always be predicted with the same certainty as passenger services. So a charge for non-use is something which clearly has a commercial effect on them. And the question is what the government intends to do over and above existing practice. When the government is both a player and has a financial interest. Again, it's one of those conflicts of interest which is being baked into the system, which doesn't exist at the moment.
It's one of those conflicts of interest being baked into the system that doesn't exist at the moment, when the government is a player and has a financial interest and it needs to explain itself, tie itself down and give some account and and be under some sort of supervision. In my view. Amendment 241 has a slightly converse effect. It prevents non-operation charges applying where the train could not operate because the GB of a GBR infrastructure failure, or because GBR took the capacity for engineering or other network activities and work. So what it does again is prevent GBR making a cancellation charge for trains that do not operate for that reason.
Again, it's a probing amendment seeking clarity, which might lead to a substantive amendment on report. When we get to that, that point. If I come then to amendment two, four, three and two for amendments two, four, three and two, four, six, this is a very worrying clause. Two, four, three. The amendment to the bill gives. The bill obliges GBR to create a scheme of access charges, but also gives to GBR the power to increase those charges in certain circumstances. Now, in the past, that power to increase the charges has been driven by. What the market, sorry, what the market can bear, but now it is to be changed so as to work out, to relate to what an efficient operator can bear.
Now this is a very, very different thing. First of all, it requires GBR to have a capacity wholly absent at the moment to to know what an efficient operator can afford to pay. This is a large economic analytical undertaking. We know that because we have regulators who deal with who have to answer the question whether something is being operated efficiently in the water sector. We had it under the London Underground, p p p , we have it in other utility sectors, and there are considerable skills, techniques and models that have been generated over the years that require this.
It is not a light undertaking to establish efficient operation. So the first thing is how is GB are going to work it out. The second is why should GBR be able to increase charges simply because they think that an efficient operator could pay them? The assumption would be that they consider the existing operator to be inefficient, maybe because it's meeting passenger demand in a different way, and that they can force up the prices to require a change in behaviour. I suppose that's what they might be trying to do. But the, the my my first question is how do they even know how to work it out?
And why should they have the power? It is a source of very considerable concern to the freight sector and others. So it raises a very important point. Amendment two, four, six relates to it. The Commission detailed work on future access charging, which considered the legal framework economic principles, incentives created by different charging structures, the recovery of infrastructure costs, impacts on passengers and freight markets, and the trade offs between efficiency, competition, investment and cost recovery. Now the author did that work? They're being taken out of it. They won't have a say in these matters any more.
Can the minister tell us whether the author will be expected to apply these principles when deciding appeals on efficient operator? Will the government be applying these principles? How is the government going to approach this question of establishing what an efficient operator is? Where are the skills going to be? Was my first question. What are the principles on which the exercise will be conducted? Is my second question on amendment 245. Under the current system, major charging changes are normally dealt with through the five year periodic review, giving operators notice and certainty in advance. Clause 64, however, allows GBR to revise or replace its charging scheme at any time.
If that flexibility is to remain, there should be at least a minimum notice period, which my amendment requires. 12 months seems entirely reasonable for businesses making long term investment and operating decisions. Sometimes I think GBR forgets that the people who are using the network, who are the 25% of train movements, if even if we if we leave the heritage sector out of it, are private businesses concerned with making private investments, which can only be recovered over the long term, they cannot be messed about with by sudden changes to pricing models. Now, if the minister thinks another notice period, not 12 months or something else is appropriate, I'm very happy to have a discussion about what it should be, but it surely cannot be at no notice on two, four, eight and 249.
Clause 65 expressly protects GBR from having to make payments where disruption is outside its control, but there is no equivalent protection on the face of the bill for freight or open access operators. Now, the government may say that those operators would not normally be penalised when they did not cause the disruption. If that's the case, why not say so clearly in the Bill? If protection from events outside one's control is right for GBR, the same principle should apply to every operator operator using the network. I mean, one thinks of a case where a train becomes derailed, a freight train might become derailed, causing congestion and disruption.
But it is nobody's fault if you see what I mean or fault has to be established. Should there be a charge for that or not? What is the system going to be? People need to know two, four, seven and 250. The government should be laying the charging scheme before Parliament and the measure should not commence until we can scrutinise it, giving its importance. And amendment 250 is is is is is is in my view simply a drafting improvement.
My Lords, with that I beg leave to move it.
19:06
19:06
Speaker 16
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Speaker 16
My Lords, sir, I am grateful to the noble Lord, Lord Moylan, for introducing this group of amendments, some of which are in my name. And it's particularly relevant when you look at the the way that freight trains operate, how much they pay and what happens when things go wrong . And things do go wrong occasionally. And it's then a question of apportioning blame, if that's the right word to the alleged cause of the delay and what and what's going to happen to be done to mitigate it. This this is where the independent regulator's role comes really to the fore, because clearly the train operators will say, well, it's not my fault.
They may even get into a a bit of an argument with one of the wagon operators who, whose wagon is failed, and where there's a liability faced there for the well, the freight train being delayed and the passengers and the other other trains, be they passenger open access or GBR trains delayed. It's it's a system that seems to work quite well at the moment, and I don't really see the point of changing it because there will be endless arguments and I'm afraid the. At the end of the day, it must be an independent body like the O r, which makes a decision on the fairness and the transparency of the whole process.
They may even get into a a bit of an argument with one of the wagon operators who, whose wagon is failed, and where there's a liability faced there for the well, the freight train being delayed and the passengers and the other other trains, be they passenger open access or GBR trains delayed. It's it's a system that seems to work quite well at the moment, and I don't really see the point of changing it because there will be endless arguments and I'm afraid the. At the end of the day, it must be an independent body like the O r, which makes a decision on the fairness and the transparency of the whole process.
19:08
Speaker 5
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Speaker 5
My Lords, I want to intervene briefly on this group of amendments, which deals with clause 64 on the charging scheme and behind my noble friend Lord Moylan's amendments. And also, I think, behind the concerns we just heard from Lord Bartley is a concern that open access operators and freight operators might be, in effect, priced out by GBR deciding on an access charge which is beyond their capacity to pay. And it's in connection with that, that I want to quote very briefly from a letter which the Secretary of State for transport wrote to the ORR on January 6th, 2025, which underlines the concerns that my noble friend expressed that open access operators might be discouraged because of the impact on the taxpayer.
And this is what the Secretary of State wrote to the Orer on the 6th of January 2025. We need to be mindful of the impacts of open access, such as the level of revenue they can abstract from contracted services and the associated implications for passengers and taxpayers. Now, I suspect that letter was prompted from the the Treasury. Indeed, because the loss of revenue from GBR passenger services will have a direct impact on the subsidy that GBR gets from the Treasury. Now, before we actually get to the question of what the access charge should be at the moment, there's a process and I can't find any reference to it in the legislation, which is carried out by ORR, which is called, which is called the abstraction rate.
And if you're an open access operator and you want to operate a new service, you have to demonstrate that no more than no less than 70% of the revenue you will get comes from an existing operator. In other words, you have to show that your service will increase the overall passenger numbers by 30%. Only if you overcome that hurdle, you come to the next one, which deals with the access charges. Now, on second reading, I did ask the minister whether they have any plans to change the abstraction rate, because if you tweak the abstraction rate, you don't even get, as far as I can understand it, to clause 64, which is what your access charge would be.
Now, I had a very helpful meeting with the minister on last week, and I discussed the abstraction rate , and the information I got from officials was that they were moving slightly away from a simple crude abstraction rate to a more broadly based formula, which did indeed look at the
And this is what the Secretary of State wrote to the Orer on the 6th of January 2025. We need to be mindful of the impacts of open access, such as the level of revenue they can abstract from contracted services and the associated implications for passengers and taxpayers. Now, I suspect that letter was prompted from the the Treasury. Indeed, because the loss of revenue from GBR passenger services will have a direct impact on the subsidy that GBR gets from the Treasury. Now, before we actually get to the question of what the access charge should be at the moment, there's a process and I can't find any reference to it in the legislation, which is carried out by ORR, which is called, which is called the abstraction rate.
And if you're an open access operator and you want to operate a new service, you have to demonstrate that no more than no less than 70% of the revenue you will get comes from an existing operator. In other words, you have to show that your service will increase the overall passenger numbers by 30%. Only if you overcome that hurdle, you come to the next one, which deals with the access charges. Now, on second reading, I did ask the minister whether they have any plans to change the abstraction rate, because if you tweak the abstraction rate, you don't even get, as far as I can understand it, to clause 64, which is what your access charge would be.
Now, I had a very helpful meeting with the minister on last week, and I discussed the abstraction rate , and the information I got from officials was that they were moving slightly away from a simple crude abstraction rate to a more broadly based formula, which did indeed look at the
19:11
Speaker 12
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Speaker 12
A simple crude abstraction rate to a more broadly based formula, which did indeed look at the abstraction rate, but also what I think was described as social factors. Now, in one aspect that might actually be very helpful to the open access operator, because there might be social reasons for agreeing to the the application, which aren't entirely captured by the abstraction rate. So the question I have for the minister on this is, firstly, will there still be an abstraction rate, and are there any plans from for on behalf of GBR to change it? And secondly, can we have slightly more details of the formula that will be used, which, as I understand it complements or perhaps perhaps replaces the abstraction rate.
So we have a clearer idea of the criteria that will be used. And the final question is why is there no reference at all in any of the legislation to the abstraction rate, which I think is a crucial factor in determining whether or not an open access operator can succeed.
So we have a clearer idea of the criteria that will be used. And the final question is why is there no reference at all in any of the legislation to the abstraction rate, which I think is a crucial factor in determining whether or not an open access operator can succeed.
19:12
Speaker 4
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Speaker 4
My Lords, let me just I've got some questions in this section. As my noble friend Lord young did. So first of all, as he said, I broadly agree with the thrust of my noble friend Lord Moylan's amendments. I think they're very helpful, and they allow us to have a discussion about clause 64. I have two specific questions in clause 64. Three, it says that the charging scheme may provide for a higher amount to be charged in particular circumstances, provided that it does not exceed the amount that GBR considers is amount that an efficient operator would be able to pay in those circumstances.
I would like to know what in particular circumstances actually means. What are the circumstances? Because it doesn't. As far as I can see, it doesn't say anywhere, what are the circumstances that would have to exist that would enable GBR to charge more than is set out in the charging scheme, because unless those circumstances are delineated in some way, it provides them the ability to just decide on on a whim that they want to just deviate from a scheme which they've had to set out, consult on and go through a proper process. They shouldn't just be able.
There should be a very limited set of circumstances, if any. I'd be interested to know what are the circumstances that the minister envisages, but they must be a limited set of circumstances, not an open ended one. The second thing, which I think is more fundamental, is in is in part five, it says that the scheme may not provide for charges to be made in relation to GBR passenger services. So in other words, GBR passenger services don't have to pay anything for access to the network. Now, some people might say, well, what's the point of that?
Because obviously they're all part of the same entity. The problem is GBR passenger services have got to make decisions about what fares it's going to charge and and what and what and whether it's going to be profitable or not. And that's obviously going to affect the taxpayer subsidy. If it's not having to pay anything for access to a network, but open access operators are having to pay for access to the network, that immediately strikes me as being rather unfair. Now, it may be that, you know, the money goes around in a, you know, it's all going to end up being with the taxpayer.
But it is important, I think, that in terms of the charging structure, GBR passenger services, which do operate in competition with other operators, should be treated in the same way. And this model says they don't have to pay anything for access to the network, which means on the face of it, they would be able to undercut open access operators when they're making decisions. Now, of course, that does mean if they're not paying anything for access to the network, then the network infrastructure part of GBR is clearly not going to have as much revenue and is going to be losing more money and requiring more subsidy from the taxpayer.
But given there are competitors involved here, it seems to me if we're going to have a level playing field and GBR is going to treat its own passenger services and GBR companies fairly as compared to open access operators and freight operators, surely GBR passenger services should have to pay for access to the network. That's what happens at the moment. Money goes from passenger operators to Network Rail, and they all have to pay for access to the network. And if you start not having transparent charges, you start hiding where the losses are. It makes it very difficult for any of us to work out whether particular services that are being operated are profitable or not.
You also then can't make sensible decisions. GBR then won't be able to make sensible decisions about which services are loss making, but have a social value where it wishes to have them subsidised by the taxpayer. But you can't make those decisions if you don't have open, transparent accounting. And we already had a bit of a discussion when we were talking the retail operations and we had some amendments which were about making sure there was transparent accounting and that the retail operations would be in a separate legal entity or a separate part of the business, so that it would be clear and transparent that there was no anti-competitive behaviour going on.
And it seems to me the same would need to happen here. And so there's a fundamental problem unless I'm I mean, I've looked at the explanatory notes. It's not I can't see anything I'm missing, but it seems to me there's a bit of a gap here about how GBR is going to be set up, how it's accounting is going to work, the level of transparency that's going to be available to, if not the public, at least for ministers and others, to be able to see which services make losses. I mean, I don't understand how the Secretary of State, when she is setting out her services that she wishes to procure.
If there's not a very clear idea about how much those services cost to deliver and produce, and then when those services are being delivered, being able to see on an ongoing basis whether those services are profitable or not, I don't see how the department is going to make sensible, financially rational decisions about which services to run. And as I said, even if the services are not profitable, if they lose money to make rational decisions about it on subsidy, you need to understand how much subsidy is required , and then ministers perfectly properly can make a judgement about whether the level of subsidy is outweighed by the social value of the service.
But unless you've got good accounting and transparent accounting and you don't know if you don't know what those numbers are, how can you make a sensible decision about whether you wish to have those services run or not, and whether the amount of taxpayer's money needed to subsidise them is sensible. So I think there's a bit of a gap here. Now, it may be I'm missing something incredibly obvious and the minister will be able to set that out, but I can't see it on the face of it. And again, it will lead other operators to see that they're not being treated in the same transparently fair way.
That will leave them concerned that there's not a level playing field here. So have I missed something obvious? I'm grateful if the minister points it out, but otherwise I'll look forward to his answer to my my couple of questions.
I would like to know what in particular circumstances actually means. What are the circumstances? Because it doesn't. As far as I can see, it doesn't say anywhere, what are the circumstances that would have to exist that would enable GBR to charge more than is set out in the charging scheme, because unless those circumstances are delineated in some way, it provides them the ability to just decide on on a whim that they want to just deviate from a scheme which they've had to set out, consult on and go through a proper process. They shouldn't just be able.
There should be a very limited set of circumstances, if any. I'd be interested to know what are the circumstances that the minister envisages, but they must be a limited set of circumstances, not an open ended one. The second thing, which I think is more fundamental, is in is in part five, it says that the scheme may not provide for charges to be made in relation to GBR passenger services. So in other words, GBR passenger services don't have to pay anything for access to the network. Now, some people might say, well, what's the point of that?
Because obviously they're all part of the same entity. The problem is GBR passenger services have got to make decisions about what fares it's going to charge and and what and what and whether it's going to be profitable or not. And that's obviously going to affect the taxpayer subsidy. If it's not having to pay anything for access to a network, but open access operators are having to pay for access to the network, that immediately strikes me as being rather unfair. Now, it may be that, you know, the money goes around in a, you know, it's all going to end up being with the taxpayer.
But it is important, I think, that in terms of the charging structure, GBR passenger services, which do operate in competition with other operators, should be treated in the same way. And this model says they don't have to pay anything for access to the network, which means on the face of it, they would be able to undercut open access operators when they're making decisions. Now, of course, that does mean if they're not paying anything for access to the network, then the network infrastructure part of GBR is clearly not going to have as much revenue and is going to be losing more money and requiring more subsidy from the taxpayer.
But given there are competitors involved here, it seems to me if we're going to have a level playing field and GBR is going to treat its own passenger services and GBR companies fairly as compared to open access operators and freight operators, surely GBR passenger services should have to pay for access to the network. That's what happens at the moment. Money goes from passenger operators to Network Rail, and they all have to pay for access to the network. And if you start not having transparent charges, you start hiding where the losses are. It makes it very difficult for any of us to work out whether particular services that are being operated are profitable or not.
You also then can't make sensible decisions. GBR then won't be able to make sensible decisions about which services are loss making, but have a social value where it wishes to have them subsidised by the taxpayer. But you can't make those decisions if you don't have open, transparent accounting. And we already had a bit of a discussion when we were talking the retail operations and we had some amendments which were about making sure there was transparent accounting and that the retail operations would be in a separate legal entity or a separate part of the business, so that it would be clear and transparent that there was no anti-competitive behaviour going on.
And it seems to me the same would need to happen here. And so there's a fundamental problem unless I'm I mean, I've looked at the explanatory notes. It's not I can't see anything I'm missing, but it seems to me there's a bit of a gap here about how GBR is going to be set up, how it's accounting is going to work, the level of transparency that's going to be available to, if not the public, at least for ministers and others, to be able to see which services make losses. I mean, I don't understand how the Secretary of State, when she is setting out her services that she wishes to procure.
If there's not a very clear idea about how much those services cost to deliver and produce, and then when those services are being delivered, being able to see on an ongoing basis whether those services are profitable or not, I don't see how the department is going to make sensible, financially rational decisions about which services to run. And as I said, even if the services are not profitable, if they lose money to make rational decisions about it on subsidy, you need to understand how much subsidy is required , and then ministers perfectly properly can make a judgement about whether the level of subsidy is outweighed by the social value of the service.
But unless you've got good accounting and transparent accounting and you don't know if you don't know what those numbers are, how can you make a sensible decision about whether you wish to have those services run or not, and whether the amount of taxpayer's money needed to subsidise them is sensible. So I think there's a bit of a gap here. Now, it may be I'm missing something incredibly obvious and the minister will be able to set that out, but I can't see it on the face of it. And again, it will lead other operators to see that they're not being treated in the same transparently fair way.
That will leave them concerned that there's not a level playing field here. So have I missed something obvious? I'm grateful if the minister points it out, but otherwise I'll look forward to his answer to my my couple of questions.
19:20
Speaker 8
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Speaker 8
The noble Lord sits down. I wonder whether I could ask the noble Lord, Lord Harper, whether he has a view on how the. The compensation charges that we discussed half an hour ago, as though would apply to the GBR services and the fares and the charges that they may be making or not. And is. Is there an imbalance there, or is it something that can get resolved?
19:20
Speaker 4
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Speaker 4
Well, it's a very fair question. I mean, look, to some extent, people listening to us outside might just think, given that GBR runs the infrastructure and services. They might say, well, what's the point in one bit of the business charging the other bit of the business? But if you're going to make economically rational decisions, it is quite important that the passenger services part of GBR, which is making decisions about which services to run and where there's demand for those services and what people are prepared to pay for them, uses the same cost basis, in other words, access to the valuable infrastructure.
The minister said on many occasions that the infrastructure is expensive and which it is, and it's important. It is used in the most economically beneficial way, and you only can do that if you have proper pricing and proper charging. And as soon as you start saying that GBR passenger services don't have to pay for access and you don't have the same, they're not being treated on the same basis. You lose the transparency, you lose the ability to make those rational economic decisions. And that's the bit that I'm missing. And if you don't set it up properly, we will end up making bad economic decisions.
And in the end, that is bad for the public because in the end that costs all lands on the taxpayer. It also has the problem that two other problems. Then I'll then I'll sit down two other problems. One is the minister talked about the importance rightly, of investment going into producing infrastructure. That's right. But you also want given that capital is limited, that capacity investment to be on the bits of the infrastructure that are going to deliver the best return for the taxpayer. Again, that means you need to understand, you need to charge for it properly.
And then the final point is, I'm not clear yet the extent to which GBR is going to publish its financial information. Now, some of it will be commercially confidential, where it operates in a competitive market, but I would expect that in a service that is being subsidised by the taxpayer to a considerable extent, that as much information as possible is published. And given that ministers come under enormous pressure to preserve existing services and deliver new services, to have that sensible conversation, both with elected representatives and the public, you have to be able to demonstrate the benefit of the service, but also how much it costs to deliver.
And again, without that level of transparency and without charging for the infrastructure, I don't see how you're going to be able to do so. My Lords.
The minister said on many occasions that the infrastructure is expensive and which it is, and it's important. It is used in the most economically beneficial way, and you only can do that if you have proper pricing and proper charging. And as soon as you start saying that GBR passenger services don't have to pay for access and you don't have the same, they're not being treated on the same basis. You lose the transparency, you lose the ability to make those rational economic decisions. And that's the bit that I'm missing. And if you don't set it up properly, we will end up making bad economic decisions.
And in the end, that is bad for the public because in the end that costs all lands on the taxpayer. It also has the problem that two other problems. Then I'll then I'll sit down two other problems. One is the minister talked about the importance rightly, of investment going into producing infrastructure. That's right. But you also want given that capital is limited, that capacity investment to be on the bits of the infrastructure that are going to deliver the best return for the taxpayer. Again, that means you need to understand, you need to charge for it properly.
And then the final point is, I'm not clear yet the extent to which GBR is going to publish its financial information. Now, some of it will be commercially confidential, where it operates in a competitive market, but I would expect that in a service that is being subsidised by the taxpayer to a considerable extent, that as much information as possible is published. And given that ministers come under enormous pressure to preserve existing services and deliver new services, to have that sensible conversation, both with elected representatives and the public, you have to be able to demonstrate the benefit of the service, but also how much it costs to deliver.
And again, without that level of transparency and without charging for the infrastructure, I don't see how you're going to be able to do so. My Lords.
19:23
Speaker 9
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Speaker 9
I very much agree with the questions that have been asked and look forward to the minister's answers. I'm here to explore the business impact of the bill outside passenger services, and I'll speak a bit later on open access, but I am interested, having seen this clause in the impact on rail freight, because if the economics of rail freight are uncertain, freight will move on to the road. Has the noble Lord the minister consulted with the freight industry or big users like the supermarkets? I remember when I was at Tesco we moved on to rail away from low road actually to great public acclaim as part of our carbon reduction programme.
Have these sectors of business been consulted in preparing this legislation and if so, what have they said? Are they happy with the arrangements, or are there outstanding concerns that the committee should know of?
Have these sectors of business been consulted in preparing this legislation and if so, what have they said? Are they happy with the arrangements, or are there outstanding concerns that the committee should know of?
19:24
Speaker 6
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Speaker 6
My Lords, there's been some important questions raised to fully understand access charging, which I think is a concern to the wider sector, and many of them were set out by Lord Young of Cookham. Charges need to be transparent and fair to providers and. But they do need to cover the true costs. And there's been a suspicion for some time that that's not always been the case. I know my noble friend Lord Bradshaw, and I, I think, raised this certainly in conversations, but I think we raised it at second reading. So if the noble Lord, the minister could provide some clarity in this area, it would be very helpful.
19:25
Speaker 14
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Speaker 14
My Lords, I'll begin first with amendments two, four, 2 to 2, four, four. As my noble friend Lord Berkeley has, I will be the primary decision maker on charging. That's why the bill requires GBR to levy the cost directly incurred as the baseline charge. But it leaves the precise methodologies and supplementary charges to be developed by GBR through consultation with industry , and. We have consulted with industry and the access and use policy is the result of a significant amount of consultation with the industry itself. We've left the industry to consider, as they naturally would the relationship with their own customers.
I think it would be rather. I think it would be rather, it would be odd of us to go to the customers of rail freight companies when they know their market perfectly well, and and the government intends them to continue to be private sector. Markets. We believe it's preferable to allow GBR charging framework to evolve over time, subject to consultation, rather than fixing a particular approach in legislation. This means the charging arrangements can continue to evolve over time, as they've done over the years that the author has been responsible for charging framework to support the industry to support industry engagement with the charging proposals.
The draft Access and use policy, as I've said, includes a section on charging described directly incurred as based on the best available and reasonable view of efficient costs that arise from and vary with the operation of train services and which would not be incurred to the same extent in the absence of that operation. Consultation also identifies the short that the short run marginal components of these total costs will be identified, measured and attributed in a manner that is appropriate and proportionate, seeks to pass unreasonably high costs onto operators charging scheme. Those charges can be appealed to the LRR.
I recognise the concerns from both Noble Lords Berkeley and and Moylan that charges above the cost directly incurred should not be set at a level that undermines operators ability to operate efficiently and sustainably. Railway incurs costs beyond the immediate.
I think it would be rather. I think it would be rather, it would be odd of us to go to the customers of rail freight companies when they know their market perfectly well, and and the government intends them to continue to be private sector. Markets. We believe it's preferable to allow GBR charging framework to evolve over time, subject to consultation, rather than fixing a particular approach in legislation. This means the charging arrangements can continue to evolve over time, as they've done over the years that the author has been responsible for charging framework to support the industry to support industry engagement with the charging proposals.
The draft Access and use policy, as I've said, includes a section on charging described directly incurred as based on the best available and reasonable view of efficient costs that arise from and vary with the operation of train services and which would not be incurred to the same extent in the absence of that operation. Consultation also identifies the short that the short run marginal components of these total costs will be identified, measured and attributed in a manner that is appropriate and proportionate, seeks to pass unreasonably high costs onto operators charging scheme. Those charges can be appealed to the LRR.
I recognise the concerns from both Noble Lords Berkeley and and Moylan that charges above the cost directly incurred should not be set at a level that undermines operators ability to operate efficiently and sustainably. Railway incurs costs beyond the immediate.
19:28
Speaker 16
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Speaker 16
I'm sorry, could the noble Lord just explain to me if the scheme of charges is based on an assumption of an efficient operator, as the noble Lord seems to say? If I'm understanding correctly, why does the government. Does GBR need a power to set a charge higher on the basis that it could be afforded by an efficient operator? It was the variation to meet the efficient operator test that I was objecting to.
19:28
Speaker 14
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Speaker 14
So the answer to the noble Lord is that is that there is a similar test today, and I think he, he or another noble Lord referred to it, which is the test called the market compare costs. And the reason for that is because the the railway incurs cost far beyond the immediate wear and tear caused by individual services. And where, as. Under today's framework, the bill allows GBR to recover an appropriate share of the costs for operating, maintaining and renewing the network. Those who use it that can also afford it so it doesn't fall solely on the taxpayer.
So that's why clause 643 permits charges above the costs directly incurred, but only when they're affordable for an efficient, efficient operator. And as I've said, that is in practice a similar test to the one that the Ori uses today. And the purpose of the provision is to strike a fair balance between enabling GBR to recover an appropriate contribution towards the cost of the railway, and ensuring that charges don't undermine the viability of operators or the incentives that support growth, innovation and investment across various markets. GBR is expected to develop and publish a methodology. Setting out how affordability will accept will be assessed in consultation with industry and indeed the draft Access and Use policy sets out how GBR will about it.
And as I said, operators will have a right of appeal to the LRR if they consider that GBR is either acting inconsistently with its statutory duties or its applied charges in a discriminatory or anti-competitive manner. We've talked about the efficient operator already turning to amendment 200.
So that's why clause 643 permits charges above the costs directly incurred, but only when they're affordable for an efficient, efficient operator. And as I've said, that is in practice a similar test to the one that the Ori uses today. And the purpose of the provision is to strike a fair balance between enabling GBR to recover an appropriate contribution towards the cost of the railway, and ensuring that charges don't undermine the viability of operators or the incentives that support growth, innovation and investment across various markets. GBR is expected to develop and publish a methodology. Setting out how affordability will accept will be assessed in consultation with industry and indeed the draft Access and Use policy sets out how GBR will about it.
And as I said, operators will have a right of appeal to the LRR if they consider that GBR is either acting inconsistently with its statutory duties or its applied charges in a discriminatory or anti-competitive manner. We've talked about the efficient operator already turning to amendment 200.
19:30
19:30
Speaker 14
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Speaker 14
This is replicating something that is already happening today because the the the cost of the infrastructure are in excess of, of, of the summation of what people are charging. So envisaging anything terribly difficult today. And the reason I've described rights of appeal and so forth is because I'm expecting this to be dealt with in the future in the way that it is today, but it's always open to operators to appeal if they believe that it's being it's being dealt with in a, in an, in an anti-competitive manner.
19:31
Speaker 4
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Speaker 4
But with respect to the minister, that doesn't really answer my question. It may be what's happening today, but what is the answer to the question about what are the circumstances in which GBR will be able to charge this higher amount of money? That's all I'm asking. And if it's happening today, it should be a relatively straightforward question to answer.
19:31
19:31
19:31
19:31
19:31
19:31
19:31
Speaker 14
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Speaker 14
Turning to amendment two 240 about charges. When capacity is not utilised, clause 64 doesn't force GBR to levy charges whenever a service fails to operate. Rather, it requires GBR to set out transparently how such circumstances would be treated within its charging framework. Whether a charge is applied in any given case will remain a matter requiring judgment and discretion. The ability to consider charges for unused capacity already exists within the current legislative framework today, and although it's not currently actively used, we believe it's important to retain this capability as GBR brings together responsibility for access and charging decisions with such finite with.
So I'm sorry, start again. Finite capacity on the network. It is important that when when operators are granted access, they make a reasonable effort to make use of it and are disincentivize to simply hold from simply holding on to the ability to levy a reservation. Charge is a useful tool to drive the right behaviors and incentives on the network, ensuring best use is made of capacity and operators remain accountable for providing services they previously agreed to deliver. Having said that, GBR will need to take into consideration divergent industry operating model such as freight, which is market driven and therefore has less assurance on services.
So on that basis, GBR would of course need to consider its duties to promote freight growth before ever levying such a charge. But alternatively, however, the concept of one freight operator preventing another freight operator from being given those rights instead is equally detrimental to freight growth. And in today's framework, when a freight operator holds on to rights that it's not using, Network Rail finds it extremely challenging to incentivise that operator to release that path so it can reallocate the rights to another freight operator does have business through contract with through a contract with freight customer to use the path as intended, which is the directing mind.
There's an opportunity to utilise reservation charges in in a useful way to come to contemplate best use, whilst also protecting and promoting the growth of the freight sector. Network rail analysis of some key freight markets suggests that just over two thirds of usable freight paths in the timetable are actually utilized, though this varies substantially by commodity, location and market conditions. Of course, that's not to say that the remaining paths are not needed, or that they should be subject to reservation charges. Demand is not consistent, is not constant, and the origins of destination and destinations of according to customer needs.
And we would never expect anything of.
So I'm sorry, start again. Finite capacity on the network. It is important that when when operators are granted access, they make a reasonable effort to make use of it and are disincentivize to simply hold from simply holding on to the ability to levy a reservation. Charge is a useful tool to drive the right behaviors and incentives on the network, ensuring best use is made of capacity and operators remain accountable for providing services they previously agreed to deliver. Having said that, GBR will need to take into consideration divergent industry operating model such as freight, which is market driven and therefore has less assurance on services.
So on that basis, GBR would of course need to consider its duties to promote freight growth before ever levying such a charge. But alternatively, however, the concept of one freight operator preventing another freight operator from being given those rights instead is equally detrimental to freight growth. And in today's framework, when a freight operator holds on to rights that it's not using, Network Rail finds it extremely challenging to incentivise that operator to release that path so it can reallocate the rights to another freight operator does have business through contract with through a contract with freight customer to use the path as intended, which is the directing mind.
There's an opportunity to utilise reservation charges in in a useful way to come to contemplate best use, whilst also protecting and promoting the growth of the freight sector. Network rail analysis of some key freight markets suggests that just over two thirds of usable freight paths in the timetable are actually utilized, though this varies substantially by commodity, location and market conditions. Of course, that's not to say that the remaining paths are not needed, or that they should be subject to reservation charges. Demand is not consistent, is not constant, and the origins of destination and destinations of according to customer needs.
And we would never expect anything of.
19:35
Speaker 8
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Speaker 8
Those. I'm grateful to my noble friend, very briefly on this subject. Could you explain how , if there's a a delay on the on the line caused by GBR infrastructure. Who pays whom? If it's a GBR passenger train, an open access freight train, or an open access passenger passenger train, and they all pay the same. And to whom do they pay? Could. It looks to me as if GBR is going to be paying itself.
19:35
19:35
Speaker 14
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Speaker 14
If my noble lord, if my noble friend will forgive me, I'll get to that subject shortly. Network rail analysis of some key freight markets suggest that just. Oh, I'm sorry I lost my place and I'll I'll I'll move on it. What I've said does highlight the potential role for reservation charges in encouraging operators to release paths where they are genuinely no longer required, helping to ensure scarce capacity can be repurposed to support new freight services and future growth. Where there's demand. The bill therefore, balances important flexibility needed for those differences to be considered fairly, whilst simultaneously avoiding blanket exemptions that undermine effective capacity management and efficient use of the railway.
Turning to two, four, one, two, four eight and 249, I should begin by clarifying that clause 65 concerns the framework for GBR charging scheme and the circumstances in which charges may apply. It's not the mechanism through which disruption is addressed, and that's the purpose of clause 65 and the performance regime. The Bill is clear that where GBR is responsible for disruption, it should compensate affected operators. Indeed, we expect GBR to remain liable in most circumstances because it will almost the ability to influence service recovery, infrastructure resilience or operational decision making. However, there may be exceptional circumstances where disruption is genuinely outside GBR control.
For example, following a major terrorism railway is subjected to police investigation, security searches or evacuations. GBR may have little or no ability to influence when normal services can resume such circumstances. It wouldn't be right to automatically require taxpayers to fund compensation payments for events that GBR could neither prevent nor reasonably mitigate. Importantly, the bill does not attempt to define every such circumstance on the face of legislation. Instead, GBR will be required to consult on its approach, publish its policy transparently and remain subject to appeal through the IRR that allows the framework to evolve alongside the railway and its users, rather than being constrained by a fixed statutory definition.
I would also want to provide some reassurance to the noble Lord Moylan regarding freight operations in amendment 249. Clause 653 B applies specifically to GBR because GBR is uniquely responsible for the operation, maintenance and renewal of the national railway infrastructure. Third party operators don't carry those responsibilities and therefore not exposed to liability for infrastructure failures, engineering works or other matters that sit beyond their control. For that reason, an operator outside GBR could not be held responsible for disruption caused by infrastructure failures or planned engineering works undertaken by GBR, and the bill already allocates responsibility according to which party is best able to manage and influence the risk in question.
More broadly, clause 65 is intended to achieve a fair balance between protecting operators when they are affected by the actions of others, whilst also protecting taxpayers from bearing costs. Where GBR could not reasonably have prevented or mitigated disruption. Amendments two, four, five and two four, six two, four, seven and 250, the charging performance schemes will not be developed in isolation as under the current framework, GBR will be required to develop these arrangements through a detailed and highly consultative process, working closely with the sector, including the IRR. And that's why the published Draft Access and Use policy is being consulted on currently, and I hope it demonstrates this approach.
The bill already establishes important safeguards. The matters GBR must consider when developing charging arrangements, for instance in relation to transparency requirements for consultation with affected parties and in providing route to appeal where operators believe decisions are inconsistent with statutory requirements or published policies. Given those circumstances, the requirement to lay these schemes before Parliament for a further three months would not add any substantive protections for operators and in fact, all this would realistically achieve is delay implementation and reduce the system's ability to respond efficiently to industry needs. The noble Lord also suggests a minimum of 12 months notice be given before changes are made to the charging scheme.
The bill already provides significant stability through the wider funding and charging framework. Charges will be developed within the context of GBR funding period review process conducted every five years, giving operators greater visibility of costs and future expectations. In the highly unlikely event, significant changes were ever required to be made in the middle of a funding period. The bill also requires GBR to consult affected operators specifically, specifically before making, replacing or revising its charging scheme. So operators will therefore have an opportunity to review and make representations about proposed charges, and they'll also retain retain rights of appeal to the IRR.
Finally, the analysis referred to by the Noble Lords Amendment was produced by the IRR in advance of the new access and charging framework set out in this bill ever being developed, its purpose was to inform inform our decision making under different sets of regulations, institutional arrangements and responsibilities which this bill supplies for GBR. We would expect GBR to consider relevant evidence, analysis and stakeholder views when developing its own charging process policies. However, we don't believe it will be sensible for Parliament to require GBR potentially many years or decades from now, to have regard to a particular publication produced under the previous framework, especially the organisation it applied to no longer holds the charging responsibilities it sets out in the first place.
Rail markets, technology and the needs of users will continue to evolve, and charging policy must be able to evolve alongside already provides for consultation, transparency and regulatory oversight. The future charging scheme. These are the appropriate safeguards. Rather than tying future charging decisions into legislation or specific documents. Let me turn to the noble Lord young about the about the obstruction rate. So he he will, I hope, have seen because we discussed it last week, access to news policy at page 35, a piece which is seeking to move away from a narrow, not primarily extracted test and towards a fuller assessment of what delivers the greatest benefits for passengers, taxpayers and the wider economy, ensuring decisions are based on the full picture rather than weighted towards a single obstruction metric.
It will still include an obstruction rate, but it will also allow these wider factors to be considered. We believe that's beneficial to applicants, and we also think that rail railway capacity is too valuable and too scarce to be allocated based on a single headline measure. And I know from from conversations that applicants find that single test to be to be disproportionately difficult when some of their cases include some of the things that people want from the railway network and which go beyond a obstruction itself. The right decision depends on the circumstances of each case, including passenger demand, operational performance, capacity constraints, and a wide and the wider benefits of service can bring and.
And the approach will ensure that all these considerations are taken into account rather than applying a crude pass and fail test. So if a proposed new service brings significant economic benefits, perhaps by opening new direct rail connections that will support economic regeneration, jobs, housing and growth. GBR will need to weigh those benefits against any obstruction impacts, and in some instances, there may be a strong case to grant access, even where there are higher levels of abstraction.
And finally, I'd like to turn to the noble Lord.
Turning to two, four, one, two, four eight and 249, I should begin by clarifying that clause 65 concerns the framework for GBR charging scheme and the circumstances in which charges may apply. It's not the mechanism through which disruption is addressed, and that's the purpose of clause 65 and the performance regime. The Bill is clear that where GBR is responsible for disruption, it should compensate affected operators. Indeed, we expect GBR to remain liable in most circumstances because it will almost the ability to influence service recovery, infrastructure resilience or operational decision making. However, there may be exceptional circumstances where disruption is genuinely outside GBR control.
For example, following a major terrorism railway is subjected to police investigation, security searches or evacuations. GBR may have little or no ability to influence when normal services can resume such circumstances. It wouldn't be right to automatically require taxpayers to fund compensation payments for events that GBR could neither prevent nor reasonably mitigate. Importantly, the bill does not attempt to define every such circumstance on the face of legislation. Instead, GBR will be required to consult on its approach, publish its policy transparently and remain subject to appeal through the IRR that allows the framework to evolve alongside the railway and its users, rather than being constrained by a fixed statutory definition.
I would also want to provide some reassurance to the noble Lord Moylan regarding freight operations in amendment 249. Clause 653 B applies specifically to GBR because GBR is uniquely responsible for the operation, maintenance and renewal of the national railway infrastructure. Third party operators don't carry those responsibilities and therefore not exposed to liability for infrastructure failures, engineering works or other matters that sit beyond their control. For that reason, an operator outside GBR could not be held responsible for disruption caused by infrastructure failures or planned engineering works undertaken by GBR, and the bill already allocates responsibility according to which party is best able to manage and influence the risk in question.
More broadly, clause 65 is intended to achieve a fair balance between protecting operators when they are affected by the actions of others, whilst also protecting taxpayers from bearing costs. Where GBR could not reasonably have prevented or mitigated disruption. Amendments two, four, five and two four, six two, four, seven and 250, the charging performance schemes will not be developed in isolation as under the current framework, GBR will be required to develop these arrangements through a detailed and highly consultative process, working closely with the sector, including the IRR. And that's why the published Draft Access and Use policy is being consulted on currently, and I hope it demonstrates this approach.
The bill already establishes important safeguards. The matters GBR must consider when developing charging arrangements, for instance in relation to transparency requirements for consultation with affected parties and in providing route to appeal where operators believe decisions are inconsistent with statutory requirements or published policies. Given those circumstances, the requirement to lay these schemes before Parliament for a further three months would not add any substantive protections for operators and in fact, all this would realistically achieve is delay implementation and reduce the system's ability to respond efficiently to industry needs. The noble Lord also suggests a minimum of 12 months notice be given before changes are made to the charging scheme.
The bill already provides significant stability through the wider funding and charging framework. Charges will be developed within the context of GBR funding period review process conducted every five years, giving operators greater visibility of costs and future expectations. In the highly unlikely event, significant changes were ever required to be made in the middle of a funding period. The bill also requires GBR to consult affected operators specifically, specifically before making, replacing or revising its charging scheme. So operators will therefore have an opportunity to review and make representations about proposed charges, and they'll also retain retain rights of appeal to the IRR.
Finally, the analysis referred to by the Noble Lords Amendment was produced by the IRR in advance of the new access and charging framework set out in this bill ever being developed, its purpose was to inform inform our decision making under different sets of regulations, institutional arrangements and responsibilities which this bill supplies for GBR. We would expect GBR to consider relevant evidence, analysis and stakeholder views when developing its own charging process policies. However, we don't believe it will be sensible for Parliament to require GBR potentially many years or decades from now, to have regard to a particular publication produced under the previous framework, especially the organisation it applied to no longer holds the charging responsibilities it sets out in the first place.
Rail markets, technology and the needs of users will continue to evolve, and charging policy must be able to evolve alongside already provides for consultation, transparency and regulatory oversight. The future charging scheme. These are the appropriate safeguards. Rather than tying future charging decisions into legislation or specific documents. Let me turn to the noble Lord young about the about the obstruction rate. So he he will, I hope, have seen because we discussed it last week, access to news policy at page 35, a piece which is seeking to move away from a narrow, not primarily extracted test and towards a fuller assessment of what delivers the greatest benefits for passengers, taxpayers and the wider economy, ensuring decisions are based on the full picture rather than weighted towards a single obstruction metric.
It will still include an obstruction rate, but it will also allow these wider factors to be considered. We believe that's beneficial to applicants, and we also think that rail railway capacity is too valuable and too scarce to be allocated based on a single headline measure. And I know from from conversations that applicants find that single test to be to be disproportionately difficult when some of their cases include some of the things that people want from the railway network and which go beyond a obstruction itself. The right decision depends on the circumstances of each case, including passenger demand, operational performance, capacity constraints, and a wide and the wider benefits of service can bring and.
And the approach will ensure that all these considerations are taken into account rather than applying a crude pass and fail test. So if a proposed new service brings significant economic benefits, perhaps by opening new direct rail connections that will support economic regeneration, jobs, housing and growth. GBR will need to weigh those benefits against any obstruction impacts, and in some instances, there may be a strong case to grant access, even where there are higher levels of abstraction.
And finally, I'd like to turn to the noble Lord.
19:44
19:44
Speaker 12
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Speaker 12
Before the just on that, it seems a little bit odd that the legislation gives all sorts of protection against an open access operator being overcharged, which is what clause 64 does. But there's absolutely nothing in the legislation at all, or any protection from the abstraction rate being changed. I understand exactly what's in the consultative document and what the minister has said, but there's absolutely nothing in the legislation about this at all. So while I understand that that is what is proposed, they could just change it and they say, well, in future, because of the impact of loss of revenue to the Treasury, the abstraction rate is no longer going to be 70%.
It's it's going to be 60%. In other words, you've got to show that your application will increase the overall traffic by 40% instead of 30%. Now, as I understand it, there's absolutely nothing that an open access operator could do if the criteria that the minister has just read out were changed, because there's nothing in the act about it in the bill, and he says that the decisions have to be reasonable, but other decisions transparent. What is the process for challenging them? It seems to me that there's a major loophole in the protection for open access operators in the legislation.
As it stands, if I've correctly understood what the minister has just said.
It's it's going to be 60%. In other words, you've got to show that your application will increase the overall traffic by 40% instead of 30%. Now, as I understand it, there's absolutely nothing that an open access operator could do if the criteria that the minister has just read out were changed, because there's nothing in the act about it in the bill, and he says that the decisions have to be reasonable, but other decisions transparent. What is the process for challenging them? It seems to me that there's a major loophole in the protection for open access operators in the legislation.
As it stands, if I've correctly understood what the minister has just said.
19:45
Speaker 14
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Speaker 14
Well, if I may, I think the first thing to say is that is that the abstraction rate is not currently in any legislation. It's a set of rules applied by the Office of Rail and Road and the and, and, and I believe what we're doing in the draft access and use policy is to make it helpful to people seeking to broaden passenger train operations on the railway by including a greater amount of, of, of benefits that could be supplied rather than applying solely accrued past and failed test. My, my understanding of this is that is that people spend a very long time attempting to match some number in order to get their, their application passed the test when actually.
A more reasonable proposition is to say, what is the total benefit of this and how and, and, and how would it affect those. I won't repeat all the all the conditions that I that I described, but we're not we're not disapplying something that's currently in legislation. It's become customary because the IRR have written their own rules on it to apply this test. And I think what we're trying to do is to make the test broader in support of the broader economic benefits that the railway service can bring.
A more reasonable proposition is to say, what is the total benefit of this and how and, and, and how would it affect those. I won't repeat all the all the conditions that I that I described, but we're not we're not disapplying something that's currently in legislation. It's become customary because the IRR have written their own rules on it to apply this test. And I think what we're trying to do is to make the test broader in support of the broader economic benefits that the railway service can bring.
19:47
Speaker 12
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Speaker 12
I'm sorry to press the minister again on this. He's quite right. There's nothing in the legislation at the moment about the abstraction rate, but crucially, it is set by the author. It is set independently of GBR or of Network Rail under the bill before us. It will no longer be set independently by author. It will be set by GBR. GBR have a clear conflict of interest. I read the letter from the Secretary of State to the author, making it quite clear that the Treasury have an interest in the abstraction rate in the loss of revenue, and as I understand it, there is nothing in the legislation that stops that abstraction rate being changed.
There's no process of appeal. The decision needn't be transparent. And I have to say that at the moment, it seems to me this is a loophole in the protection for open access operators, for freight operators and others. And I think the minister should seriously give thought before report stage as to whether this loophole, this clear conflict of interest can be addressed.
There's no process of appeal. The decision needn't be transparent. And I have to say that at the moment, it seems to me this is a loophole in the protection for open access operators, for freight operators and others. And I think the minister should seriously give thought before report stage as to whether this loophole, this clear conflict of interest can be addressed.
19:48
Speaker 14
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Speaker 14
Well, I certainly respect the noble Lords view, but I would reiterate that actually the the industry as a whole has become used to the test applied by the author in circumstances where, in so far as I'm aware, there was no consultation in the first place about what the abstraction rate was and what what we're actually trying to do here is to make these applications more representative of the wider benefits that that, that, that these sorts of railway services can bring. But I will reflect on what he's saying, because I understand the point that he's that the point that he's making.
But I hope that he'll recognize from my point of view that what's in the access and use policy at page 35 is designed to make it easier for people to pass this test, because there may well be other benefits of the of the services that they propose to operate, which don't currently get considered. Because, because the abstraction rate is, is, is a primary test that if you fail it, you don't, you don't get anywhere.
But I hope that he'll recognize from my point of view that what's in the access and use policy at page 35 is designed to make it easier for people to pass this test, because there may well be other benefits of the of the services that they propose to operate, which don't currently get considered. Because, because the abstraction rate is, is, is a primary test that if you fail it, you don't, you don't get anywhere.
19:49
Speaker 4
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Speaker 4
So just so that the minister, when he reflects, doesn't end up reflecting on the the wrong things. Just to be clear, I think my noble friend and certainly myself, I think we agree that having that slightly wider test is actually very sensible. The real issue is at the moment the abstraction test is carried out by an independent body, and it's now going to be done by an organisation that is effectively part of the government. And I'm afraid, having dealt with the Treasury on this, as I'm sure my noble friend has, and my noble friend sitting in front of me has, the Treasury has a very clear view about open access and about abstraction rates.
It views anybody else operating on the network as basically taking money that belongs to it. And I'm afraid once you don't have an independent body setting the rules, I'm afraid the temptation is going to be there. And that is what people are concerned about, and that is what the minister should reflect upon, if I may humbly suggest.
It views anybody else operating on the network as basically taking money that belongs to it. And I'm afraid once you don't have an independent body setting the rules, I'm afraid the temptation is going to be there. And that is what people are concerned about, and that is what the minister should reflect upon, if I may humbly suggest.
19:50
Speaker 14
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Speaker 14
Well, I've listened to both noble Lords and I pay close attention to what they say, so I will reflect further on it. Let me just finish quickly by saying to the noble Lord Harper that in fact he will note in clause 64, paragraph five, that the GBR will have to calculate what the charges are, which would have been that it should pay in order that people can see what it's doing there. I'm sorry that I'm a little bit incoherent because I can't currently read my own writing on it, but he he was suggesting that that calculation wouldn't be made.
And clause five actually requires it to be made. What I would say on a wider basis.
And clause five actually requires it to be made. What I would say on a wider basis.
19:50
Speaker 4
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Speaker 4
Is no, no, just so I'm clear, there's two different things that are going on here. What the minister is talking about. And he's right. It is covered by the second part of five is the charges for the infrastructure. What I was suggesting was if the passenger services part of GBR is not having to pay access to the infrastructure, how is that? How how are they going to calculate their fare structure and the fares in a way that is fair and equal to their competitors? And if I just throw out there a similar example, this is exactly what happened with British Telecom and why Ofcom forced it to take its infrastructure business and separate it as Openreach, with an independent board, an independent financial structures, because it knew that BT was tempted strategically to favour its retail operations in accessing its infrastructure.
So what I'm concerned about, I absolutely accept that the infrastructure pricing will be fair. What I'm concerned about is that the retail operations, the rail services, will not be priced fairly and equitably because they're not having to pay for access to the infrastructure. And as far as I can tell, that's not covered by the bill.
So what I'm concerned about, I absolutely accept that the infrastructure pricing will be fair. What I'm concerned about is that the retail operations, the rail services, will not be priced fairly and equitably because they're not having to pay for access to the infrastructure. And as far as I can tell, that's not covered by the bill.
19:52
Speaker 14
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Speaker 14
I'd say the noble Lords. I believe that clause five does cover that circumstance. And I would further say that actually, one of the benefits of having GBR is that for the first time, for a very long time, are actually able to have the costs and revenues associated with particular parts of the network. And I think that one of the benefits of GBR is that that will that information will be more widely available than it has been. In fact, it wasn't available for 30 years. And when I, when I when I first got to Network Rail in 2015, there was no, there was no, there was no connection between any costs spent on or, or, or from the network and any of the income that accrued from it.
And actually, I think that's one of the reasons why decisions on the railway haven't been terribly well made. But I believe that what I've said about clause five does cover what the noble Lord says. But in order to make progress, I'll I'll, I'll reflect on it to make sure that my belief is is correct.
And actually, I think that's one of the reasons why decisions on the railway haven't been terribly well made. But I believe that what I've said about clause five does cover what the noble Lord says. But in order to make progress, I'll I'll, I'll reflect on it to make sure that my belief is is correct.
19:53
19:53
19:53
Speaker 16
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Speaker 16
My Lord. So Great British Railways embarks upon this knotty matter of how to charge other people for using its infrastructure with no established expertise, no criteria for how they're going to make the decisions apart from one line in a bill, no certainty for private investors subject to no appeal other than on J.R.R. grounds, with a clear conflict of interest and with a miserly treasury looking over its shoulder. So it's bound to be a huge success. The debate has led me, and I acknowledge I've left this a bit late, but I didn't want to add to the interruptions to the noble Lord as he was winding up.
And so I perfectly understand if he doesn't answer my question. The question I'm going to add now. But since we're in committee, I hope I can stray a little bit to ask it, because it struck me in the course of debate that there there is a power, of course, in clause 64 for to charge a lower rate in circumstances in which Great British Railways considers it to be appropriate. And some of these are for a purpose A to D, but the final purpose E is for any other reason. So for any other reason it can choose to charge a lower rate.
And this made me think about the freight industry, because of course , the government has a freight target. So it could be the case that the government charges freight a lower rate rather than a higher rate. I don't know, I'm merely speculating in order to meet its its targets. Very loose target. It doesn't even get measured until 2040 on the latest. But its 2050 target with a staging post in 2040. But it could it be charging a lower. And could that lead to circumstances where the same infrastructure was available to freight companies at one very low advantageous rate, and to open access companies at a very much higher rate?
Could it even lead to the government? And these might be particular circumstances to talk to my to respond to my noble friend Lord Harper, could it even lead to open access operators being charged a super premium in order to help compensate for the discount that has been given to freight operators? In my theoretical example, in order to encourage meeting the target, as I say, it's unfair to ask the minister to respond to that now, but I will and I will, if I may beg leave, to withdraw.
My amendment.
And so I perfectly understand if he doesn't answer my question. The question I'm going to add now. But since we're in committee, I hope I can stray a little bit to ask it, because it struck me in the course of debate that there there is a power, of course, in clause 64 for to charge a lower rate in circumstances in which Great British Railways considers it to be appropriate. And some of these are for a purpose A to D, but the final purpose E is for any other reason. So for any other reason it can choose to charge a lower rate.
And this made me think about the freight industry, because of course , the government has a freight target. So it could be the case that the government charges freight a lower rate rather than a higher rate. I don't know, I'm merely speculating in order to meet its its targets. Very loose target. It doesn't even get measured until 2040 on the latest. But its 2050 target with a staging post in 2040. But it could it be charging a lower. And could that lead to circumstances where the same infrastructure was available to freight companies at one very low advantageous rate, and to open access companies at a very much higher rate?
Could it even lead to the government? And these might be particular circumstances to talk to my to respond to my noble friend Lord Harper, could it even lead to open access operators being charged a super premium in order to help compensate for the discount that has been given to freight operators? In my theoretical example, in order to encourage meeting the target, as I say, it's unfair to ask the minister to respond to that now, but I will and I will, if I may beg leave, to withdraw.
My amendment.
19:56
19:56
19:56
Speaker 18
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Speaker 18
243 A and 244 Lord Berkeley not moved two four 5 to 2 four seven. Lord Moylan not moved. So the question now is that clause 64 stands. As many as are of that opinion will say content not content. The contents have it in clause 65. Lord Moylan two four 8 to 250 not moved. So the question now is at clause 65 stamp out of the bill. As many as are content, not content. The contents have it in clause 66251 Lord Moylan moved 251 a Lord Berkeley not. moved 252. Lord Hendy moved formally. The question is this amendment be agreed to?
As many as are of that opinion will say content contrary not content. Their contents have it. So the question now is that clause 66, as amended, stand part of the Bill. As many as are of that opinion was content to the contrary, not content. The contents have it. And the question is, of course, 67. Stand by the bill. As many as are of that opinion, say content. The contrary, not content.
The contents in clause 68. Amendment 253 Lord Moylan.
As many as are of that opinion will say content contrary not content. Their contents have it. So the question now is that clause 66, as amended, stand part of the Bill. As many as are of that opinion was content to the contrary, not content. The contents have it. And the question is, of course, 67. Stand by the bill. As many as are of that opinion, say content. The contrary, not content.
The contents in clause 68. Amendment 253 Lord Moylan.
19:57
Speaker 16
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Speaker 16
My Lords, I should say I've been very neglectful in earlier groups in thanking noble lords who've given me support for my amendments for doing so. So let me start by thanking the noble Lord, Lord Berkeley, for putting his name to my, my, my First Amendment in this group. Two, five, three. My Lords, I can be very brief because although I have a large number of amendments in this group, their purpose is to work together to achieve a single effect, and that is that the and the the AU are acting as an appeal body should be able to consider an appeal on its merits, rather than simply on the process grounds suitable to a judicial review proceeding.
Moreover, that it should, having reached a view, have a power to be able to substitute its decision for that made by GBR. And the reason for this is plain equity, and I think it's been brought out very clearly in the debate we've just had on charging, where I think the government is in a state of complete confusion and not able to answer the very pertinent questions that have been raised by my noble friends and others in the course of that debate, the conflicts of interest built into the structure deliberately chosen by the government are so stark that a proper appeal process has to be available, and that means an appeal process that can look at the merits of the case and can substitute its own decisions.
Now, I note that there are in this group amendments from my noble friend Lord Lansley, which offer something akin to a halfway house. It might be that a halfway house is satisfactory. It might be that the government is willing to come forward with some significant changes. I'm happy to discuss them. I will say, however, that the test of success and acceptability of any halfway house is both the equity of the case. That is, the justice that is required to manage conflicts of interest in a transparent way, but also the practical test of whether they are sufficient to persuade the private sector to continue investing in rail infrastructure, rail, freight and open access to continue investing in it.
Because if the uncertainty and the inadequacy of the appeal process is such that they have no confidence in being able to seek redress against a decision that they find unacceptable and wrong, then they will simply cease to invest. And there will be very little more going on on the railways on that front. The Transport Committee, transport Select committee in the other place reached much the same conclusion. It described the judicial review based appeal mechanism as overly narrow, and specifically warned that it could jeopardize jeopardize the government's own objective objective of increasing rail freight. I also wish to speak very, very briefly to my other amendments 264 and 265 in this group, which are adjacent to that topic, rather than being core to it.
And they require consultation with open access operators on the appeal process. And open access operators should not be considered merely any other persons for the purpose of consultation, as they are clearly a strongly affected stakeholder. My Lords, I beg to move.
Moreover, that it should, having reached a view, have a power to be able to substitute its decision for that made by GBR. And the reason for this is plain equity, and I think it's been brought out very clearly in the debate we've just had on charging, where I think the government is in a state of complete confusion and not able to answer the very pertinent questions that have been raised by my noble friends and others in the course of that debate, the conflicts of interest built into the structure deliberately chosen by the government are so stark that a proper appeal process has to be available, and that means an appeal process that can look at the merits of the case and can substitute its own decisions.
Now, I note that there are in this group amendments from my noble friend Lord Lansley, which offer something akin to a halfway house. It might be that a halfway house is satisfactory. It might be that the government is willing to come forward with some significant changes. I'm happy to discuss them. I will say, however, that the test of success and acceptability of any halfway house is both the equity of the case. That is, the justice that is required to manage conflicts of interest in a transparent way, but also the practical test of whether they are sufficient to persuade the private sector to continue investing in rail infrastructure, rail, freight and open access to continue investing in it.
Because if the uncertainty and the inadequacy of the appeal process is such that they have no confidence in being able to seek redress against a decision that they find unacceptable and wrong, then they will simply cease to invest. And there will be very little more going on on the railways on that front. The Transport Committee, transport Select committee in the other place reached much the same conclusion. It described the judicial review based appeal mechanism as overly narrow, and specifically warned that it could jeopardize jeopardize the government's own objective objective of increasing rail freight. I also wish to speak very, very briefly to my other amendments 264 and 265 in this group, which are adjacent to that topic, rather than being core to it.
And they require consultation with open access operators on the appeal process. And open access operators should not be considered merely any other persons for the purpose of consultation, as they are clearly a strongly affected stakeholder. My Lords, I beg to move.
20:02
20:02
Speaker 8
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Speaker 8
Oh my Lords, my name has been is in on the First Amendment in this group and I. I fully support the statement by the noble Lord, Lord Moylan. About the question of independent. Regulation. And I spent a lot of time over the years talking to the existing regulators or the Office of Rail Regulation, and they've developed over the years. And I mean, the key to me is that they have gained the confidence of the industry. Now, it's a confidence which is so important , because if the industry doesn't have confidence in this, it won't go to the system.
It will probably give up and walk away. And so I see no reason to change the existing Orer role and remit. They've got a good reputation and they deal with complaints pretty quickly for a regulator. And many other regulators take a long, long, lot longer to do that. And so I think we should get rid of any idea of everything having to go for a judicial review and stick with the Orer. And we've talked about the Orer many times this afternoon, and I think they need to they need the support from politicians and ministers, and they'll do a good job.
So I fully support this amendments.
It will probably give up and walk away. And so I see no reason to change the existing Orer role and remit. They've got a good reputation and they deal with complaints pretty quickly for a regulator. And many other regulators take a long, long, lot longer to do that. And so I think we should get rid of any idea of everything having to go for a judicial review and stick with the Orer. And we've talked about the Orer many times this afternoon, and I think they need to they need the support from politicians and ministers, and they'll do a good job.
So I fully support this amendments.
20:04
Speaker 11
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Speaker 11
My Lords, I have a number of amendments in this group which are not entirely all to the same purpose. They are essentially to explore this whole issue of under what circumstances, when there's an appeal to the Orer on the part of. As rail freight and others, just how exactly are they going to be considered? So the. I'm grateful. First, I should say to. Not only for the meeting with the noble Lord, the Minister last week, but also for the letter that he sent this morning, which is was the one the letter referred to by my noble friend, Lord Moylan earlier.
I didn't think it was unreasonably long. I thought it was just quite thorough, but I thought it quite thoroughly explained how judicial review might be thought to work. I think from my point of view, it demonstrated that although judicial review is often thought of as a narrow. Very limited potential for appeal, it is possible to go to further grounds using judicial review principles, but not as far as I think we need to go. So noble lords who have been ministers will have been very well aware of the reasons why ministers put judicial review appeal grounds into legislation is because they want it to be narrow.
And the letter that the noble Lord, the Minister sent to me was very clear that, for example, if one is as a decision maker, not taking something into account or taking into account something which is irrelevant to the issue, that may give grounds for judicial review. But I think actually the letter was slightly wrong in saying not taking proper account of statutory duties. I think it's not quite that wide. I think it is where account is not taken of statutory duties. And so I think there is and also there is the question of the circumstances in which a decision is held to be rational or not rational.
And the letter from the minister quite accurately says, is it within the range of reasonable decisions for a public authority? And that's essentially to say, as we are often very clear when we're thinking about judicial review, could a reasonable decision maker have arrived at this decision that is not the same as balancing the considerations that are that a regulator has a responsibility to balance. So I think there is, as we're thinking about this now in committee, and we'll doubtless return to it at report, there are three solutions. There is the judicial review solution, which essentially there are three broad grounds for appeal.
One is that it is illegal. I, I don't think we're arguing about that. If if it is wrong in law, it can be appealed on judicial review grounds. Secondly, that it is irrational. And I just referred to the. Is it a decision that a reasonable decision maker could make, which I think is quite gives a limited scope for appeal? And thirdly, is it subject of procedural impropriety, impropriety? And that really gets us into the territory that I really want to explore, because I think that is essentially procedural. Was a matter considered or not, was an irrelevant matter considered or not, but not how were the the considerations that should form part of that decision balanced by the regulator?
Was it done in a way that was proper balancing, taking account of all the circumstances in the legislation, or was it not? So that's why, from my point of view, when I was drafting the amendment two, five, eight, which is the operative one really here for these purposes, the question was, I think the first we can leave out if there's an error of fact, if it's of some if it's any of any significant importance, it could be the basis for an appeal, even on a judicial review basis. But secondly, that GBR failed properly to have regard to a relevant matter.
Okay. I think the minister would say that could be a judicial review decision, but I think the word properly is very is of limited use in a judicial review context. But the next two are the most important that GBR failed to give appropriate weight to a relevant matter. So it wasn't just that they didn't consider it, that they didn't consider it properly, that they didn't give it weight. And the question of how much weight should be given to issues is at the heart of the balancing of responsibilities and duties by a regulator. And then the further one is that an error was made in the exercise of discretion, which frankly, is just a way of expressing the view of the regulator, has many powers and and responsibilities.
Have they been exercised in a way that. Is it proper? Now, I didn't make all this up. I looked to see whether there might be suitable examples elsewhere that give us scope for thinking about this. And the one that I came across was the the Civil Aviation Act of 2012 schedule one to of which relates to where operator determinations might be appealed to the Competition Appeal Tribunal, paragraph three, subparagraph one of which says that the appeal against operator determinations to the CAT could be made on the basis that it was wrong on one or more of the following grounds that the determination was based on an error of fact, that the determination was wrong in law, or that the error was made, that an error was made in the exercise of a discretion.
So that's why I've used the third and put it into amendment two, five, eight, because I actually think that is the that is the operative basis. And it encompasses within that phrase whether appropriate weight has been given to the matters that a regulator has to consider. So I think we are in territory which, as my noble friend said, which is between judicial review and an appeal on its merits. Now, I have to say, I, I've applied myself to the to the bill on the basis that the bill is around establishing a directing mind. I think it is clear that if you were to give appeal on its merits, one would substantially create a second directing mind, a second an appellate mind, as it were, and the intentions of the bill would not be established.
Now, you know, we may or may not agree whether the that is the right intention, but I don't think we can simply put legislation, put something into the legislation which under so fundamentally undermines the purposes of the bill itself. Maybe we'll come back to that at report. Some people might want to do that. I personally wouldn't, and I think there have been many instances in recent years the previous administrations have likewise thought giving an appeal on the merits
I didn't think it was unreasonably long. I thought it was just quite thorough, but I thought it quite thoroughly explained how judicial review might be thought to work. I think from my point of view, it demonstrated that although judicial review is often thought of as a narrow. Very limited potential for appeal, it is possible to go to further grounds using judicial review principles, but not as far as I think we need to go. So noble lords who have been ministers will have been very well aware of the reasons why ministers put judicial review appeal grounds into legislation is because they want it to be narrow.
And the letter that the noble Lord, the Minister sent to me was very clear that, for example, if one is as a decision maker, not taking something into account or taking into account something which is irrelevant to the issue, that may give grounds for judicial review. But I think actually the letter was slightly wrong in saying not taking proper account of statutory duties. I think it's not quite that wide. I think it is where account is not taken of statutory duties. And so I think there is and also there is the question of the circumstances in which a decision is held to be rational or not rational.
And the letter from the minister quite accurately says, is it within the range of reasonable decisions for a public authority? And that's essentially to say, as we are often very clear when we're thinking about judicial review, could a reasonable decision maker have arrived at this decision that is not the same as balancing the considerations that are that a regulator has a responsibility to balance. So I think there is, as we're thinking about this now in committee, and we'll doubtless return to it at report, there are three solutions. There is the judicial review solution, which essentially there are three broad grounds for appeal.
One is that it is illegal. I, I don't think we're arguing about that. If if it is wrong in law, it can be appealed on judicial review grounds. Secondly, that it is irrational. And I just referred to the. Is it a decision that a reasonable decision maker could make, which I think is quite gives a limited scope for appeal? And thirdly, is it subject of procedural impropriety, impropriety? And that really gets us into the territory that I really want to explore, because I think that is essentially procedural. Was a matter considered or not, was an irrelevant matter considered or not, but not how were the the considerations that should form part of that decision balanced by the regulator?
Was it done in a way that was proper balancing, taking account of all the circumstances in the legislation, or was it not? So that's why, from my point of view, when I was drafting the amendment two, five, eight, which is the operative one really here for these purposes, the question was, I think the first we can leave out if there's an error of fact, if it's of some if it's any of any significant importance, it could be the basis for an appeal, even on a judicial review basis. But secondly, that GBR failed properly to have regard to a relevant matter.
Okay. I think the minister would say that could be a judicial review decision, but I think the word properly is very is of limited use in a judicial review context. But the next two are the most important that GBR failed to give appropriate weight to a relevant matter. So it wasn't just that they didn't consider it, that they didn't consider it properly, that they didn't give it weight. And the question of how much weight should be given to issues is at the heart of the balancing of responsibilities and duties by a regulator. And then the further one is that an error was made in the exercise of discretion, which frankly, is just a way of expressing the view of the regulator, has many powers and and responsibilities.
Have they been exercised in a way that. Is it proper? Now, I didn't make all this up. I looked to see whether there might be suitable examples elsewhere that give us scope for thinking about this. And the one that I came across was the the Civil Aviation Act of 2012 schedule one to of which relates to where operator determinations might be appealed to the Competition Appeal Tribunal, paragraph three, subparagraph one of which says that the appeal against operator determinations to the CAT could be made on the basis that it was wrong on one or more of the following grounds that the determination was based on an error of fact, that the determination was wrong in law, or that the error was made, that an error was made in the exercise of a discretion.
So that's why I've used the third and put it into amendment two, five, eight, because I actually think that is the that is the operative basis. And it encompasses within that phrase whether appropriate weight has been given to the matters that a regulator has to consider. So I think we are in territory which, as my noble friend said, which is between judicial review and an appeal on its merits. Now, I have to say, I, I've applied myself to the to the bill on the basis that the bill is around establishing a directing mind. I think it is clear that if you were to give appeal on its merits, one would substantially create a second directing mind, a second an appellate mind, as it were, and the intentions of the bill would not be established.
Now, you know, we may or may not agree whether the that is the right intention, but I don't think we can simply put legislation, put something into the legislation which under so fundamentally undermines the purposes of the bill itself. Maybe we'll come back to that at report. Some people might want to do that. I personally wouldn't, and I think there have been many instances in recent years the previous administrations have likewise thought giving an appeal on the merits
20:11
Speaker 3
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Speaker 3
Is going too far, that it effectively deprives the original decision maker of the ability to establish the policies and the decisions which it is their responsibility to achieve. So the only other thing I would say is there are other amendments which are looking at the question of, of what the AU can do if they determine that an appeal should be upheld. And I there are two amendments that do a different thing, so I won't let's not bother with precisely how it happens, but essentially I haven't seen any reason why the legislation should not be simpler and that instead of the current drafting, that where the where the AU are upholds an appeal, it should send it back to the to GBR in order to reconsider that decision and have the ability to give a direction to AU to the GBR about how they should conduct that reconsideration.
I don't see the need for anything else. So they should be able to quash all or part of a decision and send it back to the AU, r r and nothing more than that. And that would seem to me to be the simple and effective way of, of, of, of the ORR behaving. And that I would suggest to the minister reinforces the view that it is fundamentally the GBR who have to make the decision. So when, when they go back for reconsideration, they can make sure that it is consistent with all of their responsibilities as the intended directing mind for the railways.
So I hope that explains this. I think it is quite a wide range of issues that we have to think about, but fundamentally, at this stage, I think it's just setting out that there, in my view, is scope to bring into the legislation something that is appropriately beyond judicial review for the particular purpose of enabling there to be appeals that can look at where there has been some transparent failure on the part of the Great British Rail to balance the competing duties and responsibilities that they have to exercise.
I don't see the need for anything else. So they should be able to quash all or part of a decision and send it back to the AU, r r and nothing more than that. And that would seem to me to be the simple and effective way of, of, of, of the ORR behaving. And that I would suggest to the minister reinforces the view that it is fundamentally the GBR who have to make the decision. So when, when they go back for reconsideration, they can make sure that it is consistent with all of their responsibilities as the intended directing mind for the railways.
So I hope that explains this. I think it is quite a wide range of issues that we have to think about, but fundamentally, at this stage, I think it's just setting out that there, in my view, is scope to bring into the legislation something that is appropriately beyond judicial review for the particular purpose of enabling there to be appeals that can look at where there has been some transparent failure on the part of the Great British Rail to balance the competing duties and responsibilities that they have to exercise.
20:14
Speaker 13
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Speaker 13
My Lords, hopefully I can be relatively brief because my Liberal friends have, I think, explained that the two opposing views, if I may put it like that, they're not really opposing, but contrasting views. Thanks to my colleague there for a more diplomatic way of expressing it, I sort of lean towards, I think, look, first of all, fundamentally, I think the provision that's set out in the bill, sort of the plain vanilla judicial review, I think goes is too far in one direction. And I should just say in passing that the letter that's been referred to, which set this out was only wasn't shared with everybody.
So I sorry, I haven't had a copy of it. So I, it sounds like we're not missing enormous amount by not having it because it just sets out judicial review principles, but it wasn't sent to all of us. So I, I haven't seen it. So I'm, I forgive me if I'm repeating things that are covered in the letter. And I see that Lady Pigeon wasn't sent a copy of it either as a front bench spokesman, which perhaps is a bit of an oversight by the administrative machinery, as it were. So I'm not comfortable with a pure judicial review decision for the reasons that we've set out, because the author is independent, GBR clearly isn't independent, and that and even if this wasn't what's going to happen, there is absolutely a concern by open access operators and freight operators that GBR is not going to make these decisions in an even handed way.
So, and the minister on on a number of occasions through committee stage of this bill, when concerns have been expressed about Gbr's decision making, has tried to reassure the committee by referring to the various appeals to the order that are in the bill, but because they're only on judicial review grounds, those are quite narrow. Now, I think this is the bit where I'm probably leaning a bit more towards my noble friend , Lord Lansley's proposed solution, as I set out in one of the earlier groups today, I'm. I'm comfortable with GBR being the single directing mind.
That was what was set out in the legislation. I was responsible for the draft legislation I was responsible for. I do think, though, where I would like the Minister to reflect and if not saying today definitively, but perhaps writing to us so that if if he does agree, we can cut out a lot of tabling of amendments at report stage is in the circumstances that this government has decided where all of the passenger operations that were previously done by the private sector are going to be done by GBR. There is there is clearly a big conflict of interest.
And and we know that that conflict, that potential conflict exists. And I gave an example of a private sector operator with BT and and Openreach, where Ofcom reached exactly that conclusion that a single entity was making decisions of, of its retail operations, having priority access to the infrastructure and, and directed a complete split, albeit same ownership but complete split between those legal entities. There's clearly a big risk here. Now. I think what I would differ from my noble friend Lord Maldon, is I do think there is a risk, as my noble friend Lord Lindsay said, if you go completely to appeals on the merits, the danger is it's too dangerous.
One is that the. There are lots of appeals to the law and. And everyone that doesn't like a decision appeals it, and the URL then sets up making different decisions. Also, you do fundamentally. Then change as. As those of us who've been ministers know, if you know what the appeal mechanism is, it does change how you make decisions. So I think I'm, I'm, I'm more minded to go with my, my noble friend, Lord Lanz's, I think sensible compromise, which is to widen, widen the scope for appeal, which I think is sensible. And I think that maybe strikes the right balance with still keeping GBR as the the guiding mind, but recognising there is a real risk of this conflict taking place, and I think there is an interest.
The Minister, I think, has a real interest in reflecting upon this, because I think if if he sticks with the the legislation as drafted, which doesn't really appeal to any of us on these benches, we may end up getting amendments at report stage that go more in the direction of my noble friend Lord Moylan, which may end up being a. May end up the House may end up agreeing with us, and then the Minister then has the decision about whether he wants to have that argument. Whereas if he were to reflect on what my noble friend Lord Lansley said, and perhaps bring back a government amendment if he doesn't think my noble friend's amendments are as elegantly drafted as they could be, then, then we may end up in a happy compromise where where we're all broadly think the bill has been improved , and we don't end up pushing those further amendments to having appeals on the substance.
Now, I'm not sure if he were to do that, whether he would persuade my noble friend, Lord Moylan. He may he may not. And my noble friend will look at what was brought back, I'm sure, in substance, and see whether it was acceptable, but I do. I do think there is merit in doing that. I think just purely a judicial review appeal is too narrow, and I. It doesn't sound like it's going to satisfy very many people at all. And it is the it is the safeguard on which the Minister has lent when defending many of .
Many of the other concerns that people have raised through the the bill. So I think strengthening that safeguard, I think, from his point of view, helps to preserve the underlying. Bill structure and the GBR structure that he wishes to see and enable it to be more successful, and I think , therefore it would it would therefore be wise for him at least to reflect on it and then to come back to the committee in due course with his considered views.
So I sorry, I haven't had a copy of it. So I, it sounds like we're not missing enormous amount by not having it because it just sets out judicial review principles, but it wasn't sent to all of us. So I, I haven't seen it. So I'm, I forgive me if I'm repeating things that are covered in the letter. And I see that Lady Pigeon wasn't sent a copy of it either as a front bench spokesman, which perhaps is a bit of an oversight by the administrative machinery, as it were. So I'm not comfortable with a pure judicial review decision for the reasons that we've set out, because the author is independent, GBR clearly isn't independent, and that and even if this wasn't what's going to happen, there is absolutely a concern by open access operators and freight operators that GBR is not going to make these decisions in an even handed way.
So, and the minister on on a number of occasions through committee stage of this bill, when concerns have been expressed about Gbr's decision making, has tried to reassure the committee by referring to the various appeals to the order that are in the bill, but because they're only on judicial review grounds, those are quite narrow. Now, I think this is the bit where I'm probably leaning a bit more towards my noble friend , Lord Lansley's proposed solution, as I set out in one of the earlier groups today, I'm. I'm comfortable with GBR being the single directing mind.
That was what was set out in the legislation. I was responsible for the draft legislation I was responsible for. I do think, though, where I would like the Minister to reflect and if not saying today definitively, but perhaps writing to us so that if if he does agree, we can cut out a lot of tabling of amendments at report stage is in the circumstances that this government has decided where all of the passenger operations that were previously done by the private sector are going to be done by GBR. There is there is clearly a big conflict of interest.
And and we know that that conflict, that potential conflict exists. And I gave an example of a private sector operator with BT and and Openreach, where Ofcom reached exactly that conclusion that a single entity was making decisions of, of its retail operations, having priority access to the infrastructure and, and directed a complete split, albeit same ownership but complete split between those legal entities. There's clearly a big risk here. Now. I think what I would differ from my noble friend Lord Maldon, is I do think there is a risk, as my noble friend Lord Lindsay said, if you go completely to appeals on the merits, the danger is it's too dangerous.
One is that the. There are lots of appeals to the law and. And everyone that doesn't like a decision appeals it, and the URL then sets up making different decisions. Also, you do fundamentally. Then change as. As those of us who've been ministers know, if you know what the appeal mechanism is, it does change how you make decisions. So I think I'm, I'm, I'm more minded to go with my, my noble friend, Lord Lanz's, I think sensible compromise, which is to widen, widen the scope for appeal, which I think is sensible. And I think that maybe strikes the right balance with still keeping GBR as the the guiding mind, but recognising there is a real risk of this conflict taking place, and I think there is an interest.
The Minister, I think, has a real interest in reflecting upon this, because I think if if he sticks with the the legislation as drafted, which doesn't really appeal to any of us on these benches, we may end up getting amendments at report stage that go more in the direction of my noble friend Lord Moylan, which may end up being a. May end up the House may end up agreeing with us, and then the Minister then has the decision about whether he wants to have that argument. Whereas if he were to reflect on what my noble friend Lord Lansley said, and perhaps bring back a government amendment if he doesn't think my noble friend's amendments are as elegantly drafted as they could be, then, then we may end up in a happy compromise where where we're all broadly think the bill has been improved , and we don't end up pushing those further amendments to having appeals on the substance.
Now, I'm not sure if he were to do that, whether he would persuade my noble friend, Lord Moylan. He may he may not. And my noble friend will look at what was brought back, I'm sure, in substance, and see whether it was acceptable, but I do. I do think there is merit in doing that. I think just purely a judicial review appeal is too narrow, and I. It doesn't sound like it's going to satisfy very many people at all. And it is the it is the safeguard on which the Minister has lent when defending many of .
Many of the other concerns that people have raised through the the bill. So I think strengthening that safeguard, I think, from his point of view, helps to preserve the underlying. Bill structure and the GBR structure that he wishes to see and enable it to be more successful, and I think , therefore it would it would therefore be wise for him at least to reflect on it and then to come back to the committee in due course with his considered views.
20:20
Speaker 18
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Speaker 18
My Lords, I'm in the Molen Berkeley school of thought on these amendments. It's a simple reason I have had experience of the Competition Appeals Tribunal and the mechanism won an appeal and found that all that happened was the process went back to the beginning, and the result was exactly the same as the previous result. So I actually think there is a case, given the importance of this. Bill and the importance of having some sort of appeal in this bill, I think we should have a proper appeal. So I would support Lord Moylan and Lord Berkeley on this.
20:21
Speaker 19
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Speaker 19
My Lords, I rise briefly in support of the principle articulated by both my noble friends, and I apologise to the Minister and to noble Lords that I was unable to be here earlier this evening for some of the amendments I tabled. I'm grateful to Lord Moylan for raising some of the issues that I intended to do had they not been in a diary clash. I simply want to say that the current set up in the legislation is not satisfactory in a whole variety of different ways. I mean, it is effectively allowing GBR to mark its own homework and unless it marks its own homework correctly, or unless it marks its own homework incorrectly, then what it decides will go.
And I'm afraid that goes against the spirit of fairness. It goes against many of the principles that the minister himself has articulated. And actually, ironically, given the fact that we now have a Prime Minister who is set on realigning us with the European Union, either through the single market or indeed by rejoining the European Union. This, of course, is one part of the many measures in this Bill that will be dismantled immediately, were we to do that, good principle of European law was that the railway system of today has to have an independent, proper means of providing for access and pricing.
Those have got to be dealt with fairly and independently. And if they're not, that's illegal under European law. And if we are now going to. I don't support this. And in fact, I welcome the fact in many respects, the minister is pursuing some of the Brexit benefits in taking the line that he is. But if the government is seriously going back to alignment with the single market in whatever form, this is simply not a way that would be legally permissible. So it's not the right thing to do. It contravenes government policy. And my two noble friends have come up with two different approaches, both of which have merits.
And I hope the minister will go away and reflect on those and come back at report with a better way of doing this.
And I'm afraid that goes against the spirit of fairness. It goes against many of the principles that the minister himself has articulated. And actually, ironically, given the fact that we now have a Prime Minister who is set on realigning us with the European Union, either through the single market or indeed by rejoining the European Union. This, of course, is one part of the many measures in this Bill that will be dismantled immediately, were we to do that, good principle of European law was that the railway system of today has to have an independent, proper means of providing for access and pricing.
Those have got to be dealt with fairly and independently. And if they're not, that's illegal under European law. And if we are now going to. I don't support this. And in fact, I welcome the fact in many respects, the minister is pursuing some of the Brexit benefits in taking the line that he is. But if the government is seriously going back to alignment with the single market in whatever form, this is simply not a way that would be legally permissible. So it's not the right thing to do. It contravenes government policy. And my two noble friends have come up with two different approaches, both of which have merits.
And I hope the minister will go away and reflect on those and come back at report with a better way of doing this.
20:23
20:23
Speaker 15
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Speaker 15
My Lords. As the Bill has been going through Parliament, much of the debate and concerns raised by the rail industry and open access operators and freight operators has been around the process to decide access to the railway in order to operate services outside of Great British Railways and the appeals process and much concern was raised at this at one of the Appg to rail that I attended about the high threshold for any appeals. This judicial review level that is needed, that's been discussed, and noble Lords have set out their thinking behind their amendments and represented many of the views that have come across from open access operators, and Lord Lansley set out the.
What judicial review might mean in different ways. You could appeal in detail, but I want to highlight this with a fairly current example of access issues, which I think actually shows some of this dilemma. Transport for London wants to run four additional trains an hour for passengers at peak times on the Elizabeth line from May 2027. In the current system, Network rail objective so that you would say would be Great British Railways objective and from and even from memory, I think the DFT may have even paid for these new trains. That's just at the back of my mind, you know, helping the supply chain, creating jobs.
We've got new trains. We did. Thank you. So my memory is serving me correctly even at this hour. But in the end, the o r has supported transport for London against Network Rail to allow these trains to operate from next May. And the order issued direction on the 3rd of August 2026. And the order stated, and I quote, capacity analysis by Network Rail and GT s indicates that the proposed rights can be accommodated. Close quotes. And just to be clear, GT s operates the Elizabeth Line Services under a concession agreement for transport for London. The order , looking at the capacity analysis that both sides had done, said actually, there is capacity here.
But, you know, so the appeals mechanism has got to be at the right level. I don't know whether this current TfL example would have been able to appeal under the judicial review criteria process that you've got in, in, in the in the bill before us. Yet the order looking at the data clearly ruled in favour of the operator and for the benefit of passengers. And all the modelling showed that there was capacity on both sides. So I kind of think this is a really good sort of live example and a warning flag for any future appeal system that something like that, you've got to have transparency, you've got to show where the data is, what you're using to make a decision.
Because actually, in the end, there is capacity on that line. There's a huge demand from passengers. There are new trains that have been funded. Let's actually have them operating for the benefit of passengers. So I really look forward to the minister's thoughts on this important contentious area. But actually there could well be, with a few tweaks, a way forward that would probably satisfy most members in this room today.
What judicial review might mean in different ways. You could appeal in detail, but I want to highlight this with a fairly current example of access issues, which I think actually shows some of this dilemma. Transport for London wants to run four additional trains an hour for passengers at peak times on the Elizabeth line from May 2027. In the current system, Network rail objective so that you would say would be Great British Railways objective and from and even from memory, I think the DFT may have even paid for these new trains. That's just at the back of my mind, you know, helping the supply chain, creating jobs.
We've got new trains. We did. Thank you. So my memory is serving me correctly even at this hour. But in the end, the o r has supported transport for London against Network Rail to allow these trains to operate from next May. And the order issued direction on the 3rd of August 2026. And the order stated, and I quote, capacity analysis by Network Rail and GT s indicates that the proposed rights can be accommodated. Close quotes. And just to be clear, GT s operates the Elizabeth Line Services under a concession agreement for transport for London. The order , looking at the capacity analysis that both sides had done, said actually, there is capacity here.
But, you know, so the appeals mechanism has got to be at the right level. I don't know whether this current TfL example would have been able to appeal under the judicial review criteria process that you've got in, in, in the in the bill before us. Yet the order looking at the data clearly ruled in favour of the operator and for the benefit of passengers. And all the modelling showed that there was capacity on both sides. So I kind of think this is a really good sort of live example and a warning flag for any future appeal system that something like that, you've got to have transparency, you've got to show where the data is, what you're using to make a decision.
Because actually, in the end, there is capacity on that line. There's a huge demand from passengers. There are new trains that have been funded. Let's actually have them operating for the benefit of passengers. So I really look forward to the minister's thoughts on this important contentious area. But actually there could well be, with a few tweaks, a way forward that would probably satisfy most members in this room today.
20:27
Speaker 6
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Speaker 6
My Lords, firstly, I should apologise for the letter that I sent the noble Lord Lansley this morning that that it wasn't circulated to other noble Lords. That's my omission, because it was it was we were. I was very keen to get it out this morning. I will I will ensure that it is circulated to noble Lords as soon as possible, and I have. I have made it my business to make sure that all of the correspondence. I believe that I've sent to individual noble Lords, and this has been circulated to others. But we will check to make sure that there is no correspondence to one noble Lord that isn't copied to everybody else.
I do apologise for that, and I think there's something that there are things to agree with in this debate, because the Bill must provide a robust route for operators against GB s decisions. My concern, which Noble Lords will understand is that we don't position the the the appeal body ORR is the second parallel decision maker that can impose its own judgments in preference to GBR simply because they don't have any route and network expertise. And I and and I would say I the words I was going to say, say, say that you can see the results of having too many decision makers every day.
And I'm sorry to say that the circumstances described by the noble Baroness pigeon just now are another example of fragmented decision making on the railway, in circumstances where I think GBR, thinking about its wider duties to passengers, would would have come to a different decision on its own. I regret not knowing about it at the time, otherwise I might have done something about it well before it got to that stage. And I do think that it does demonstrate why the railway needs to be needs to be managed by somebody who by a body that does have wider considerations for passengers and the economy, because, as she says, if the trains have been bought with public money, then it's it would be ludicrous.
I do apologise for that, and I think there's something that there are things to agree with in this debate, because the Bill must provide a robust route for operators against GB s decisions. My concern, which Noble Lords will understand is that we don't position the the the appeal body ORR is the second parallel decision maker that can impose its own judgments in preference to GBR simply because they don't have any route and network expertise. And I and and I would say I the words I was going to say, say, say that you can see the results of having too many decision makers every day.
And I'm sorry to say that the circumstances described by the noble Baroness pigeon just now are another example of fragmented decision making on the railway, in circumstances where I think GBR, thinking about its wider duties to passengers, would would have come to a different decision on its own. I regret not knowing about it at the time, otherwise I might have done something about it well before it got to that stage. And I do think that it does demonstrate why the railway needs to be needs to be managed by somebody who by a body that does have wider considerations for passengers and the economy, because, as she says, if the trains have been bought with public money, then it's it would be ludicrous.
20:29
20:29
Speaker 6
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Speaker 6
Having said that, judicial review principles are a well established mechanism for holding public bodies to account. A clear example of that is in the High Court. When the High Court reviews decisions made by government departments or regulators, it focuses on whether the decision was made lawfully and fairly, rather than replacing it with its own judgment. And these principles afford the decision maker appropriate latitude to make informed judgment, to weigh different considerations against each other and to reach a balanced decision. But they also safeguard against decisions that are unreasonable or irrational, failed to take proper account of relevant statutory duties, are inconsistent with their own published policies, processes and criteria, or are otherwise unlawful, and that is the standard to which GBR should should be held.
The G. The GBR must be the decision maker on access, and the LRR should be there to ensure that GB is reasonable, rational and consistent with its duties and policies. So the Bill deliberately requires the LRR to apply judicial review principles and the amendments would, of course, as we've discussed, make the widen the process or make the make the process more Brits based. I'd particularly like to thank the noble Lord, Lord Lansley, for raising his concerns with me, and it did enable me to think very carefully and to write him. If not everybody else, but everybody else will get the letter tomorrow, for which I apologize, to look at this in detail with our lawyers and and that and and that letter is the consequence of that.
It does go into considerable detail. Apologise for that. And for example, it wouldn't be sufficient just for GBR to acknowledge a relevant duty and move on. It will need to properly consider its duties in reaching a decision, and there would need to be a lawful and rational basis for its for it, for its approach. For example, if it considered its duties in relation to freight but attached relatively little importance to them compared with other duties, it would need to have a sound and rational basis for doing so. For example, this might be because the evidence demonstrated materially greater impacts on other network users, or because the evidence relating to freight on the relevant part of the network supported the balance that GBR had struck, but it would need to explain its evidence and reasoning underpinning underpinning that assessment.
And on appeal, the LRR would consider whether GBR genuinely had regard to the relevant statutory duties reaching its decision, and can examine the reasoning underpinning underpinning that assessment, including whether it had misunderstood or missed, misapplied a relevant duty, failed to take proper account of it or reach a decision that's irrational in the light of the conditions, in the light of the considerations that ought properly to have been taken into account whilst reaching a decision. The assessment of rationality will include consideration of any relevant factors that have been taken into account by GBR, and any relevant ones that have been ignored, and it would also take note of any conclusions made by GBR that seemed entirely at odds with the facts and argument, and where its treatment of a duty or its overall balancing exercise is irrational in light of underlying evidence, or where GBR had failed to take proper account of relevant statutory duty, or where it's taken account of an irrelevant factor in reaching its decision, the Orer will be able to uphold the appeal and either send the decision back to GBR for reconsideration, or quash all or part of the decision.
What it can't do is to use the remedies set out in the bill merely because it was reached a different view. Had it been the decision maker, the LRR should have must assess whether the GBR assessment is rational in the light of the evidence, whether it's within the range of reasonable responses of a public authority and not whether it would have made the same exact decision. That judgment has to be for GBR. As the expert body in charge of the railway.
The G. The GBR must be the decision maker on access, and the LRR should be there to ensure that GB is reasonable, rational and consistent with its duties and policies. So the Bill deliberately requires the LRR to apply judicial review principles and the amendments would, of course, as we've discussed, make the widen the process or make the make the process more Brits based. I'd particularly like to thank the noble Lord, Lord Lansley, for raising his concerns with me, and it did enable me to think very carefully and to write him. If not everybody else, but everybody else will get the letter tomorrow, for which I apologize, to look at this in detail with our lawyers and and that and and that letter is the consequence of that.
It does go into considerable detail. Apologise for that. And for example, it wouldn't be sufficient just for GBR to acknowledge a relevant duty and move on. It will need to properly consider its duties in reaching a decision, and there would need to be a lawful and rational basis for its for it, for its approach. For example, if it considered its duties in relation to freight but attached relatively little importance to them compared with other duties, it would need to have a sound and rational basis for doing so. For example, this might be because the evidence demonstrated materially greater impacts on other network users, or because the evidence relating to freight on the relevant part of the network supported the balance that GBR had struck, but it would need to explain its evidence and reasoning underpinning underpinning that assessment.
And on appeal, the LRR would consider whether GBR genuinely had regard to the relevant statutory duties reaching its decision, and can examine the reasoning underpinning underpinning that assessment, including whether it had misunderstood or missed, misapplied a relevant duty, failed to take proper account of it or reach a decision that's irrational in the light of the conditions, in the light of the considerations that ought properly to have been taken into account whilst reaching a decision. The assessment of rationality will include consideration of any relevant factors that have been taken into account by GBR, and any relevant ones that have been ignored, and it would also take note of any conclusions made by GBR that seemed entirely at odds with the facts and argument, and where its treatment of a duty or its overall balancing exercise is irrational in light of underlying evidence, or where GBR had failed to take proper account of relevant statutory duty, or where it's taken account of an irrelevant factor in reaching its decision, the Orer will be able to uphold the appeal and either send the decision back to GBR for reconsideration, or quash all or part of the decision.
What it can't do is to use the remedies set out in the bill merely because it was reached a different view. Had it been the decision maker, the LRR should have must assess whether the GBR assessment is rational in the light of the evidence, whether it's within the range of reasonable responses of a public authority and not whether it would have made the same exact decision. That judgment has to be for GBR. As the expert body in charge of the railway.
20:33
Speaker 3
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Speaker 3
At the risk of trespassing on the whip for short interventions. I'll keep it, try and keep it very short, but I have had the benefit of reading your letter, the minister's letter and the Minister is referring to this rather important point. There are many references to how the decision makers in this case has to have.
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20:33
Speaker 3
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Speaker 3
Account and so on and so on. To a question as to whether the decision then taken. Including taking into account all of these duties and so on, was one that is irrational. And we're getting to the Wednesbury test of is it a decision that no reasonable decision maker could have made? That's where the problem arises, because actually we want it to be something which can test the decision that is being made. Looking at the balance of those considerations, not just whether issues have been considered or not.
20:34
Speaker 6
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Speaker 6
Well, I thank the noble Lords for that intervention, and he'll know that. I hope he knows that. I considered we we we discussed with him at some length what he was saying. And I think what I'll what I would say now is that I agree with him that about not double guessing GBR as it needs to take its decisions, but I will consider what he and others have said in the light of this discussion and go away and further further. Consider it because we have had an interesting discussion with a number of different views. And, and the thing that that most that most chimes with me understanding that NBR has to make these decisions because somebody has to be in charge of the network.
Turning to amendments. 259 and 262 I note that both noble.
Turning to amendments. 259 and 262 I note that both noble.
20:35
20:35
Speaker 6
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Speaker 6
The LRR, can quash and replace some decisions, but not others. The distinction in the bill is deliberate. The appropriate remedy reflects the different nature of the matter. Where an appeal concerns policies or strategic documents access and use policy, the LRR can remit decisions to GBR for reconsideration. The LRR may also give legally binding directions as to that reconsideration that GBR must follow. Those documents involve complex and interconnected judgments about the operation and use of the railway, in which many factors apply, and where there is often more than one acceptable answer. The interconnected nature of the policies and processes set out in these documents also means that quashing a single element in isolation will often not make sense.
It's therefore right that GBR reconsiders the provision in the light of the appeal and IRR directions. This approach also reflects that its GBR, not the author who has the expertise and whole network view, and is therefore able to take these decisions in the best interests of all railway users and its wider duties, and that ensures that the appeal that the issue identified on appeal is addressed whilst preserving GBR responsible strategic judgment. This will also make juveniles more effectively state the specific operational decisions, such as refusing an application for a train movement to be added to the working timetable.
The bill goes further. In those cases, the RR may quash all or part of the decision and send it back to the GBR for reconsideration with directions, but in some limited circumstances, the RR can substitute its own decision, and it might be helpful to think of this like marking somebody's homework. GBR is writing its homework by making the decision, and then the RR marks that homework. The RR uses GBR legal duties, its published processes and policies, and so on as its marking scheme. Some decisions might only have one possible answer like what possible correct answer like a maths problem.
And in those cases, the RR could immediately substitute the correct answer in place of GBR. Incorrect one. But for much of GBR homework, there will be no single right or wrong answer. GBR will need to exercise significant judgment. In those cases, it will be for the RR to check GBR workings and ask whether GBR got to its decision in a rational and reasonable way. If it didn't, the RR can send its homework back to GBR appropriate feedback and tell it to try again, giving the RR broader discretion to substitute its own judgment would blur responsibility and undermine GBR s role as a single directing mind.
It must have the space to apply its end to end operational knowledge and to optimise the best use of the network. Likewise, if we were to go the other way and remove the option for the RR to substitute its own decision in those specific circumstances, the matter would have to go back to GBR, even where there would only have been one lawful decision which GBR could have reached, and an unnecessary further step with the associated time and complexity for the parties involved. The limited substitution power therefore supports an efficient and proportionate appeals process without giving the RR general power to take decisions in Gbr's place.
It preserves the balance at the heart of the framework. GBR remains responsible for decision making. Whilst the author provides effective independent oversight, the process clearly provides protection for operators and I therefore urge these amendments.
It's therefore right that GBR reconsiders the provision in the light of the appeal and IRR directions. This approach also reflects that its GBR, not the author who has the expertise and whole network view, and is therefore able to take these decisions in the best interests of all railway users and its wider duties, and that ensures that the appeal that the issue identified on appeal is addressed whilst preserving GBR responsible strategic judgment. This will also make juveniles more effectively state the specific operational decisions, such as refusing an application for a train movement to be added to the working timetable.
The bill goes further. In those cases, the RR may quash all or part of the decision and send it back to the GBR for reconsideration with directions, but in some limited circumstances, the RR can substitute its own decision, and it might be helpful to think of this like marking somebody's homework. GBR is writing its homework by making the decision, and then the RR marks that homework. The RR uses GBR legal duties, its published processes and policies, and so on as its marking scheme. Some decisions might only have one possible answer like what possible correct answer like a maths problem.
And in those cases, the RR could immediately substitute the correct answer in place of GBR. Incorrect one. But for much of GBR homework, there will be no single right or wrong answer. GBR will need to exercise significant judgment. In those cases, it will be for the RR to check GBR workings and ask whether GBR got to its decision in a rational and reasonable way. If it didn't, the RR can send its homework back to GBR appropriate feedback and tell it to try again, giving the RR broader discretion to substitute its own judgment would blur responsibility and undermine GBR s role as a single directing mind.
It must have the space to apply its end to end operational knowledge and to optimise the best use of the network. Likewise, if we were to go the other way and remove the option for the RR to substitute its own decision in those specific circumstances, the matter would have to go back to GBR, even where there would only have been one lawful decision which GBR could have reached, and an unnecessary further step with the associated time and complexity for the parties involved. The limited substitution power therefore supports an efficient and proportionate appeals process without giving the RR general power to take decisions in Gbr's place.
It preserves the balance at the heart of the framework. GBR remains responsible for decision making. Whilst the author provides effective independent oversight, the process clearly provides protection for operators and I therefore urge these amendments.
20:39
20:39
Speaker 6
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Speaker 6
I'll have to take the noble Lords why and and answer that in writing, and I will, of course. Well, of course this time copy it to everybody on amendments 263 and 264. The clear intention of the framework is to provide a proportionate and accessible route of appeal to the LRR, which avoids the time, complexity and expense associated with court proceedings. Government also intends that the order will set its own practice and procedure for its appeals process, engaging with industry as it does so. Secretary of state's regulation making power does not interfere with the oral procedure.
Instead, it enables provision to be made, where necessary about steps that must be taken before an appeal can be brought, and in relation to fees and time limits. The power does not give the Secretary of State a role in determining determining individual appeals, which will remain the responsible regulation. Making power is intended as a fallback should the appeals process become unworkable or operational, changes become necessary. For example, we don't think it would be appropriate for the LRR to set its own fees. Any proposal to charge fees ought to be subject to ministerial and parliamentary scrutiny.
These powers are not intended to be routinely exercised, but could be useful if LRR proposed to make changes, such as introducing fees that ought to be subject to wider scrutiny. The power can be exercised only after consultation with the lrr and any other persons the Secretary of State considers appropriate. That provision is deliberately flexible and has been included to enable consultation with stakeholders, including open access operators, where relevant, without creating an unnecessarily rigid statutory list. The on amendment 260. To be clear, before issuing, revising or replacing its appeals process, practice and procedure, RR must consult any other persons it considers appropriate.
In addition to any named statutory consultees. This deliberately gives the flexibility to consult with and stakeholders, including open access operators, without creating an inflexible and unwieldy system. Importantly, engagement on the future appeals process and procedure is already happening. The LRR published its Appeals Process discussion document in December last year and sought early views from the industry on its emerging approach. This included its thinking on indicative time limits for when an appeal might be brought and appeal windows open access operators have already contributed to the development of emerging appeals process, and will have further opportunity to do so through our formal consultation following Royal Assent.
I therefore urge noble Lords to withdraw their amendments.
Instead, it enables provision to be made, where necessary about steps that must be taken before an appeal can be brought, and in relation to fees and time limits. The power does not give the Secretary of State a role in determining determining individual appeals, which will remain the responsible regulation. Making power is intended as a fallback should the appeals process become unworkable or operational, changes become necessary. For example, we don't think it would be appropriate for the LRR to set its own fees. Any proposal to charge fees ought to be subject to ministerial and parliamentary scrutiny.
These powers are not intended to be routinely exercised, but could be useful if LRR proposed to make changes, such as introducing fees that ought to be subject to wider scrutiny. The power can be exercised only after consultation with the lrr and any other persons the Secretary of State considers appropriate. That provision is deliberately flexible and has been included to enable consultation with stakeholders, including open access operators, where relevant, without creating an unnecessarily rigid statutory list. The on amendment 260. To be clear, before issuing, revising or replacing its appeals process, practice and procedure, RR must consult any other persons it considers appropriate.
In addition to any named statutory consultees. This deliberately gives the flexibility to consult with and stakeholders, including open access operators, without creating an inflexible and unwieldy system. Importantly, engagement on the future appeals process and procedure is already happening. The LRR published its Appeals Process discussion document in December last year and sought early views from the industry on its emerging approach. This included its thinking on indicative time limits for when an appeal might be brought and appeal windows open access operators have already contributed to the development of emerging appeals process, and will have further opportunity to do so through our formal consultation following Royal Assent.
I therefore urge noble Lords to withdraw their amendments.
20:42
Speaker 8
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Speaker 8
My Lords, it's it struck me in the course of this debate that, of course, any decision made by the Orer must be judicially reviewable its public body. So a decision made by the Orer, even on judicial review type grounds, could still find its way up through the courts. There'll be multiple directing minds still involved. And the argument that the bill, the argument that the single directing mind is absolutely crucial to the welfare of the railways is an assertion. It's not demonstrated. And as my noble friend Lord Young of Cookham, sadly , has gone home at a respectable time, as my noble friend Lord Young of Cookham, said on second reading, what the noble Lord the minister objects to.
As fragmentation is known in other sectors as specialisation, and the notion of a single directing mind has to be. The benefits of it have to be demonstrated and argued for. They cannot simply be asserted, and it seems to me clear that it's perfectly possible for the government to be subject to a proper appeals process, because, as I say, not only is there a question of equity involved, but also the assurance that the private sector needs if they are to continue investing for something which can only generate a long term return? I think it's fair to say that the noble Lord, the minister, has listened to those concerns.
I was unpersuaded by the letter he sent to my noble friend Lord Lansley, a copy of which, in fact I did get, because it was passed to me by my noble friend, so I. I hope other noble lords don't feel I was unduly advantaged by being included in the circulation. I wasn't, in fact. But my noble friend did send me a copy of the letter. Everyone was equally disadvantaged. I just wanted to be clear that there are no particular privileges granted to me. But my noble friend did pass me a copy of it, and. And so I was able to read it this morning.
And and I have some familiarity with the process of judicial review and thinking that goes into a judicial review process. And as I said earlier, I didn't mean it in a dismissive way. I meant it all the letter really did is set out how judicial review, how judicial review works. And there was very little in it that was new or particular, in fact, to this bill. I hope that the noble Lord feels that the current position is unsustainable, and that he seemed to indicate. This is what I found so interesting in his conversation with my noble friend Lord Lansley.
He seemed to indicate that he might be willing to come forward with a compromise between now and report stage, which is not very far away, it would appear, and if that is the case, then we will be able to return to this subject with greater enlightenment on every part when we come to that point. In the meantime, however, I beg leave to withdraw my amendment.
As fragmentation is known in other sectors as specialisation, and the notion of a single directing mind has to be. The benefits of it have to be demonstrated and argued for. They cannot simply be asserted, and it seems to me clear that it's perfectly possible for the government to be subject to a proper appeals process, because, as I say, not only is there a question of equity involved, but also the assurance that the private sector needs if they are to continue investing for something which can only generate a long term return? I think it's fair to say that the noble Lord, the minister, has listened to those concerns.
I was unpersuaded by the letter he sent to my noble friend Lord Lansley, a copy of which, in fact I did get, because it was passed to me by my noble friend, so I. I hope other noble lords don't feel I was unduly advantaged by being included in the circulation. I wasn't, in fact. But my noble friend did send me a copy of the letter. Everyone was equally disadvantaged. I just wanted to be clear that there are no particular privileges granted to me. But my noble friend did pass me a copy of it, and. And so I was able to read it this morning.
And and I have some familiarity with the process of judicial review and thinking that goes into a judicial review process. And as I said earlier, I didn't mean it in a dismissive way. I meant it all the letter really did is set out how judicial review, how judicial review works. And there was very little in it that was new or particular, in fact, to this bill. I hope that the noble Lord feels that the current position is unsustainable, and that he seemed to indicate. This is what I found so interesting in his conversation with my noble friend Lord Lansley.
He seemed to indicate that he might be willing to come forward with a compromise between now and report stage, which is not very far away, it would appear, and if that is the case, then we will be able to return to this subject with greater enlightenment on every part when we come to that point. In the meantime, however, I beg leave to withdraw my amendment.
20:45
20:45
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20:46
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20:46
Speaker 21
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Speaker 21
As many as are of that opinion will say content contrary not content. The contents have it. The question is that clause 69 stamp out of the bill. As many as are of that opinion will say content. The contrary not content. The contents have it. Are we carrying on? Yes, yes. In clause 70, amendment 266, Lord Lansley.
20:47
Speaker 8
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Speaker 8
Lord, could could I ask the noble Baroness, Lady Dacre, whether she intends to move that we do now adjourn the Committee. We have less than 30 minutes to go. We'll be starting on a group and which habitually. And this is not a criticism at all. The noble Lord. The Minister is brief to speak for up to his full allocation of 20 minutes, so we will not hear his answer. We will be breaking after a few speeches, I think the committee would appreciate it. The House has gone home. We are not falling badly behind in any sense.
We've conducted ourselves with discipline and goodwill in the course of this committee over the last six days. I think the committee would appreciate it if she were to move that we do not continue.
We've conducted ourselves with discipline and goodwill in the course of this committee over the last six days. I think the committee would appreciate it if she were to move that we do not continue.
20:47
20:47
Speaker 22
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Speaker 22
Around about 30 minutes, just under 30 minutes. I do believe we can start and finish at 915. As we all were aware, that was the time that we would be finishing and we do not know next week whether we're getting additional amendments, whether things might get regrouped, etc.. So if we could possibly continue and then we'll. exactly note who's here and continue if we don't finish, which we won't finish this evening, but at least we would have made a start on it.
20:48
Speaker 8
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Speaker 8
May I ask, is the noble Baroness saying that we are going to stop at 915 or immediately after the speech, at the end of the speech being made? At that point, some of us have not actually been able to have a loo break in the course of the last five hours. We should stop. These five hour sessions are too long, right?
20:48
Speaker 22
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Speaker 22
I understand your frustrations and the time is what is set and what is usually been. And we can regulate that. What we can do is to see how far we get and then take a break. Okay, at 915, so that we get somebody who's speaking just before 915, then we can stop. Stop then. But I think we have time to at least hear some speakers.
20:49
20:49
20:49
Speaker 13
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Speaker 13
Can I just before we move on, just briefly, first of all, just to clarify, and I think that the chair has it was made very clear to the House by the committee that set out the changes to the way Grand Committee would operate, is that the deal was that when we moved from 4 hours to 5 hours, the five hours was a hard stop. So just to be clear that that and I think that's been made clear. The reason why I just on the whole point about stopping this group has got seven, seven members who've actually got their names attached to amendments.
And just from experience, if you end up starting the group, I understand why the, the, the whip wants to make progress. But if we start the group and we've only made 1 or 2 speeches, you end up having a needlessly repetitious debate when we return to it on Monday, because, frankly, people can't always remember what happened like nearly a week beforehand. So I'm not sure it actually we make an awful lot of progress. But I hear what she says. We're all very content to proceed if if we want to, but I'm not sure it actually means that we get the business done enormously more expeditiously than we would otherwise do.
And just from experience, if you end up starting the group, I understand why the, the, the whip wants to make progress. But if we start the group and we've only made 1 or 2 speeches, you end up having a needlessly repetitious debate when we return to it on Monday, because, frankly, people can't always remember what happened like nearly a week beforehand. So I'm not sure it actually we make an awful lot of progress. But I hear what she says. We're all very content to proceed if if we want to, but I'm not sure it actually means that we get the business done enormously more expeditiously than we would otherwise do.
20:50
20:50
20:50
Speaker 3
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Speaker 3
So amendment 266 in my name just raises the question, which, frankly, when I tabled the amendment, I didn't understand how it was going to work. But I've worked it all through. I think effectively we're going to get two access arrangements. One is GBR, who pretty much determine their own access arrangements and determine for themselves who can access their infrastructure and so on. Separately, there are infrastructure managers to whom for in relation to whom the existing arrangements under the two 2016 regulations will be applied pretty much in the same way as they apply now to Network Rail.
And indeed, instead of the way, the way the bill has is drafted, creates a new statutory duty on infrastructure managers to provide access rights to others in a way that they don't necessarily do now, or would do at the moment through Network Rail. So who are these infrastructure managers? But principally, I think they're people like H. S one or Eurotunnel or the Heathrow Airport spur. There might be 1 or 2 in TfL that the minister will know well, who are themselves the infrastructure managers and not under the control of Network Rail. So all I'm looking for in this amendment is for the Minister to say.
Yet there is no further intention than to apply the existing 2016 approach to infrastructure managers other than GBR. I beg to move. Two. Six six.
And indeed, instead of the way, the way the bill has is drafted, creates a new statutory duty on infrastructure managers to provide access rights to others in a way that they don't necessarily do now, or would do at the moment through Network Rail. So who are these infrastructure managers? But principally, I think they're people like H. S one or Eurotunnel or the Heathrow Airport spur. There might be 1 or 2 in TfL that the minister will know well, who are themselves the infrastructure managers and not under the control of Network Rail. So all I'm looking for in this amendment is for the Minister to say.
Yet there is no further intention than to apply the existing 2016 approach to infrastructure managers other than GBR. I beg to move. Two. Six six.
20:52
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20:52
Speaker 19
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Speaker 19
My Lords, I have amendment 267 in this group, and I think there's a really important, important principle here. And I think the Minister has quite a lot of reassurance to do about this particular piece of the legislation, because what it does at face value is it allows the Secretary of State to issue regulations that rewrite existing access arrangements. Now, we know that both the Treasury and I have to say also this Secretary of State aren't wildly keen on the existing open access contracts. The Secretary of State wrote a letter recently basically saying no more open access, can't cope with it, don't want them, I paraphrase, but the minister knows full well that that was the broad gist of what she wrote.
And the Treasury certainly doesn't like open access, for the reasons we heard in earlier debates from various noble lords, because ultimately, Treasury officials see this as a loss of revenue and therefore, as a result, a theoretical increase in the subsidy they have to provide for the railways. I've no doubt the treasurer would like to see open access disappear altogether. And having taken a decision to have a unified Great British Railways, to have that as the only organisation operating passenger services on the network. And yet actually there's been a significant expansion of open access in recent years.
We have right now the launch of a Lumo service from London to Stirling, which is clearly, I think it's using the West Coast Main Line rather than the East Coast Main line. One of the busiest railways in the country. The author has identified a potential train paths available to do that, but I've no doubt that the view and the Treasury would be, oh no, not another open access operator. We don't want that. And I've no doubt also that within the Department of Transport and the leadership of the Secretary of State, there will be a degree of reluctance, given that letter that was written saying to the lrr , that that the government does not want to see more open access on the rail network.
So this particular clause would appear to allow the Secretary of State to use congested infrastructure constraints in the infrastructure, or similar to, say, right, we are going to rewrite some of our existing open access operators contracts. And the minister slightly shakes his head, but that's actually what it says. It does very clearly allow the existing access arrangements to be overwritten because of infrastructure reasons, and the only logical infrastructure reasons that could be for taking those away. Taking those contracts away would be if the government says, well, actually, there's not enough space, there's too many constraints, there's blockages, there are things we don't want to do in terms of infrastructure management, and we want to run fewer trains.
So I want to hear a very clear explanation for the minister what the purpose of this is. And my amendment is designed to basically set some very clear limits on how it can be used. And I very much want to see the government justify what's in this particular clause and explain why what I'm proposing is not necessary and why it should be rejected. And I hope that, at the very least, the Minister, whilst we might be dividing on this tonight. Well, we'll go away and come back with what I think is a more reasonable clause that properly protects the interests of the existing open access operators in less.
There are absolutely exceptional circumstances, and in which case proper compensation would need to be paid. So it's very much over to the minister to justify something that seems to me to be entirely unjustifiable.
And the Treasury certainly doesn't like open access, for the reasons we heard in earlier debates from various noble lords, because ultimately, Treasury officials see this as a loss of revenue and therefore, as a result, a theoretical increase in the subsidy they have to provide for the railways. I've no doubt the treasurer would like to see open access disappear altogether. And having taken a decision to have a unified Great British Railways, to have that as the only organisation operating passenger services on the network. And yet actually there's been a significant expansion of open access in recent years.
We have right now the launch of a Lumo service from London to Stirling, which is clearly, I think it's using the West Coast Main Line rather than the East Coast Main line. One of the busiest railways in the country. The author has identified a potential train paths available to do that, but I've no doubt that the view and the Treasury would be, oh no, not another open access operator. We don't want that. And I've no doubt also that within the Department of Transport and the leadership of the Secretary of State, there will be a degree of reluctance, given that letter that was written saying to the lrr , that that the government does not want to see more open access on the rail network.
So this particular clause would appear to allow the Secretary of State to use congested infrastructure constraints in the infrastructure, or similar to, say, right, we are going to rewrite some of our existing open access operators contracts. And the minister slightly shakes his head, but that's actually what it says. It does very clearly allow the existing access arrangements to be overwritten because of infrastructure reasons, and the only logical infrastructure reasons that could be for taking those away. Taking those contracts away would be if the government says, well, actually, there's not enough space, there's too many constraints, there's blockages, there are things we don't want to do in terms of infrastructure management, and we want to run fewer trains.
So I want to hear a very clear explanation for the minister what the purpose of this is. And my amendment is designed to basically set some very clear limits on how it can be used. And I very much want to see the government justify what's in this particular clause and explain why what I'm proposing is not necessary and why it should be rejected. And I hope that, at the very least, the Minister, whilst we might be dividing on this tonight. Well, we'll go away and come back with what I think is a more reasonable clause that properly protects the interests of the existing open access operators in less.
There are absolutely exceptional circumstances, and in which case proper compensation would need to be paid. So it's very much over to the minister to justify something that seems to me to be entirely unjustifiable.
20:56
Speaker 18
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Speaker 18
My Lords, I rise to support amendment 267 in the name of my noble friend Lord Grayling, and echo everything that he said, we are looking for a firmer guarantee that the power in clause 71 is not intended to revisit, reduce or extinguish existing access rights. As we've heard, the amendment limits the power so that it only applies in circumstances where it's necessary for transferring contracts to the new regime. And, as drafted, clause 71 creates an unacceptable degree of uncertainty for non GBR operators, notably for open access operators. I understand they could also become subject to open ended and retrospective change.
You know, the associated risk will put off capital investment . Clarity on the face of the legislation is needed for continued investment by rail, freight and open access operators. I'd like to say I'm a huge fan of open access, and I believe that Lumo and Hull trains have highlighted its success. I know from experience that Lumo offers tremendous value. London and Carlisle return recently for £17. My only complaint is the luggage racks, which are too small for airline compliant suitcases, leading to a scramble for the admittedly generous but inadequate space at the end of each carriage.
The services to Stirling and Edinburgh, which I've tried, are reliable, and the competition they provide will keep the GBR own fleet on its toes. I haven't tried hard trains, but I gather they've recorded a 94% satisfaction rate this year in the Rail Customer Experience Survey. I have one final question, which arises from what the minister said in the debate on Monday the open access operators, freight carriers and the cafes and other services along the nationalised railways all have an interest in Gbr's business plan. We don't want any of them driven into cutting back services needlessly or going into insolvency at a time when all SMEs are under pressure from tax and cost increases.
When will the Gbr's business plan be consulted on, and when will business planning be concluded and the plan approved? The industry needs certainty, both on the face of the Bill and in respect of the plans going forward.
You know, the associated risk will put off capital investment . Clarity on the face of the legislation is needed for continued investment by rail, freight and open access operators. I'd like to say I'm a huge fan of open access, and I believe that Lumo and Hull trains have highlighted its success. I know from experience that Lumo offers tremendous value. London and Carlisle return recently for £17. My only complaint is the luggage racks, which are too small for airline compliant suitcases, leading to a scramble for the admittedly generous but inadequate space at the end of each carriage.
The services to Stirling and Edinburgh, which I've tried, are reliable, and the competition they provide will keep the GBR own fleet on its toes. I haven't tried hard trains, but I gather they've recorded a 94% satisfaction rate this year in the Rail Customer Experience Survey. I have one final question, which arises from what the minister said in the debate on Monday the open access operators, freight carriers and the cafes and other services along the nationalised railways all have an interest in Gbr's business plan. We don't want any of them driven into cutting back services needlessly or going into insolvency at a time when all SMEs are under pressure from tax and cost increases.
When will the Gbr's business plan be consulted on, and when will business planning be concluded and the plan approved? The industry needs certainty, both on the face of the Bill and in respect of the plans going forward.
20:59
Speaker 17
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Speaker 17
My Lords. These are very interesting amendments because I think some of them originate from a European railway legislation 10 or 20 years ago about congested infrastructure, which tried to persuade the relevant member state or trade or infrastructure manager that they couldn't take any more trains, so they better do some investment in the infrastructure. In parallel. One gets the feeling over some of these applications that Network Rail would be would really prefer not to run any more trains, because otherwise they might become less reliable and they'd have less time for picking up any delays. And therefore, it's really important that there's an independent assessment of what is actually possible and desirable and viable in terms of the capacity on what I think is still called a congested , a piece of infrastructure, because if it can take more freight or passengers open access or not, then surely it's that's what the railways there for to, to offer its customers a good service.
21:00
Speaker 13
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Speaker 13
My Lords, I'm going to limit my remarks to the three amendments which are in the names of the noble Lord Barclay, in which I have attached my name. Now, the reason why I support these amendments is not to get in the way of what we want to do with GBR, but to make sure the transition is fair and workable and make sure that there is the relevant certainty that those private sector operators depend on. Now, the reason why it matters. My noble friend Baroness Neville-rolfe already referred to Lumo and whole trains. Now those companies procure trains and commit capital years in advance, and they rely for funding those for that capital on the rights and commercial agreements they've reached.
So their ten year agreement, for example, that's worth around £500 million, including maintenance for 14 British built Hitachi trains. It illustrates the scale and duration of those commitments. We're talking about significant amounts of money serving, employing lots of people, serving significant numbers of customers. And the important thing which my noble friend Baroness Neville Rolfe pointed out, is the fact that these open access operators exist, keeps the other operators more competitive, and there's very clear evidence that where they compete, for example, with Eleanor. Eleanor is is forced lower prices and deliver better services to customers, so everybody benefits.
Now, the problem with the clause as it's drafted is it gives the Secretary of State very wide powers to alter existing access arrangements. Now, I know that minister has said that existing rights will be honoured, but that isn't what the bill currently says. And it's not just the concern of those of us in the committee. The Delegated Powers and Regulatory Reform Committee was fairly scathing about this clause. It referred to the government's memorandum and the various reasons that the minister gave for the clause. But what it said was it said there was a good case for a delegated power to deal with the transition from one model to another.
But it said in seeking to deal with the transitional position, the government has proposed a power that is drafted in strikingly broad terms and without any, any express or implied reference to its purpose. And whilst clause 712 illustrates some of the things that the power may be used for, it doesn't narrow the scope and the committee said the power essentially confers a unilateral right to amend contracts to which the government is a party, and the memorandum implicitly recognises the potential for interference with the private rights of train operating companies, and is at pains to clarify the government intends to use the power in a limited way, and that memorandum, to be fair, explains the government's explain committed that the core rights in these contracts will be preserved as far as possible, it says.
Accordingly, the government considers that the core commercial value of the access contracts, enabling the contract holder to run trains on GBS network and therefore make a commercial gain, will not be unduly affected, and the power will not be exercised lightly and would only be used for absolutely necessary changes, such as to reflect the creation of the GB of GBR. Now, I. I emphasize 1 or 2 of those words because they're quite flexible and for a private sector company borrowing hundreds of millions of pounds to procure trains to run a commercial operation, these aren't high margin businesses.
And even if the government makes changes which are only as far as possible and not unduly affected and and make changes are absolutely necessary, all of those things could be met, and you could still change the contract in a way that made it not commercially viable for the company to be running it, or where their investors would not otherwise have invested the money. And making those changes unilaterally and retrospectively, I don't think is acceptable. And the committee, the delegated powers Committee, said these assurances would not be necessary if the delegated power was more constrained, for example, by reference in the Bill to its purpose.
And the committee made the point that they don't judge delegated powers on how the government says it will use them, but on how any government might use them. So it's no good. The minister saying he's lovely and reasonable, and this government's lovely and reasonable, and it's not going to do certain things if it's able to. Any future government which he isn't able to bind could use those powers inappropriately. And the committee said the exercise of this power could interfere significantly with private contractual rights. And it said, well, there are mechanisms to ensure that train operating companies are protected to some extent because there are powers to provide for dispute resolution and payment of compensation.
They're mentioned in 712 creation of those mechanisms and the effectiveness of their protection are entirely at the government's discretion. There's nothing in the clause, as drafted that says there have to be provisions for compensation or mechanisms for dispute resolution. It says the government can do that, but it doesn't say the government has to do that. And in light of the government's intentions, the recommendation, the clear recommendation of the committee was the power in clause 711 should be amended so that it can only be used for purposes that give effect to those intentions. So, in other words, the things the government said it wants to do in the memorandum, the limits on which it's going to use that power, the committee is very clear that that should be constrained on the face of the bill.
The second thing it said final thing it said was that exercise of the power in clause 711 is subject to the negative procedure. The memorandum from the government says that's because this is a transitional and technical matter and that because of this, the affirmative procedure or the hybrid procedure that could be triggered by it would not be justified. But the committee said it is true that the power covers the transition between access regimes, and the resulting regulations are likely to be technical, but those are not in themselves . Reasons for avoiding the affirmative procedure . If the potential effect of regulations is sufficiently important that automatic debate by Parliament is appropriate, and avoidance of the hybrid procedure is a surprising approach to justifying the negative procedure.
Where private rights are sufficiently protected, it's common for bills to include a d hybridisation provision so that regulations to subject to the affirmative procedure don't trigger the hybrid procedure. Now, the power is currently drafted may be exercised to interfere significantly with private contractual rights, and parliamentary scrutiny of the delegated legislation has a role in ensuring appropriate protection of those rights, particularly if they are not sufficiently protected by the power itself. And so, the committee said. Its second recommendation said since the power in clause 71 1st May significantly affect private contractual rights, we recommend to the House that to ensure appropriate protection of those rights, it's exercises subject to the affirmative procedure.
So there's two very important recommendations there from the Delegated Powers Committee, which I think are very sensible and I think the government should respond to. Now, the Minister has referred on a number of occasions to the access and use policy, which TR is consulting on the draft model contracts that are in the future, access and use policy have mechanisms for unilateral variation, and although those proposals are not final and they're obviously being consulted on the fact that GBR is envisaging unilateral variation of contracts, I think reinforces the need for clear protection of the agreements that are currently in place, because it's clearly, clearly, given that they're consulting on having unilateral variation of contracts, it clearly is not outside their thinking that that may be something that they wish to do.
So the amendments that Lord Berkeley and I have tabled still allow the technical changes needed to keep those existing agreements operational as responsibilities transfer to GBR. But what they don't what they prevent is material rewriting of the commercial bargain, all the agreed allocation of risk, and they end at the start of GBR first funding period. So it's genuinely transitional and not open ended. And so my question to the minister is, if the government's intention, as it's set out in its memorandum to the Delegated Powers Committee, is genuinely that these are only to be used to make existing agreements work under the new structure.
Why is the government taking powers that go much, much further? And I would say to the minister that if he wants a private operators to have the confidence to continue to invest in delivering services which are enormously valued by the public. So the services, my noble friend Baroness Neville-rolfe, referred to the services provided by Hull Trains and Lumo Trains, enormously valued by the public and supported by members of Parliament along the line of route. If they want to continue making sure they exist and those private sector operators continue investing, then I think the minister should do what the Delegated Powers Committee has recommended and limit the power on the face of the Bill.
So their ten year agreement, for example, that's worth around £500 million, including maintenance for 14 British built Hitachi trains. It illustrates the scale and duration of those commitments. We're talking about significant amounts of money serving, employing lots of people, serving significant numbers of customers. And the important thing which my noble friend Baroness Neville Rolfe pointed out, is the fact that these open access operators exist, keeps the other operators more competitive, and there's very clear evidence that where they compete, for example, with Eleanor. Eleanor is is forced lower prices and deliver better services to customers, so everybody benefits.
Now, the problem with the clause as it's drafted is it gives the Secretary of State very wide powers to alter existing access arrangements. Now, I know that minister has said that existing rights will be honoured, but that isn't what the bill currently says. And it's not just the concern of those of us in the committee. The Delegated Powers and Regulatory Reform Committee was fairly scathing about this clause. It referred to the government's memorandum and the various reasons that the minister gave for the clause. But what it said was it said there was a good case for a delegated power to deal with the transition from one model to another.
But it said in seeking to deal with the transitional position, the government has proposed a power that is drafted in strikingly broad terms and without any, any express or implied reference to its purpose. And whilst clause 712 illustrates some of the things that the power may be used for, it doesn't narrow the scope and the committee said the power essentially confers a unilateral right to amend contracts to which the government is a party, and the memorandum implicitly recognises the potential for interference with the private rights of train operating companies, and is at pains to clarify the government intends to use the power in a limited way, and that memorandum, to be fair, explains the government's explain committed that the core rights in these contracts will be preserved as far as possible, it says.
Accordingly, the government considers that the core commercial value of the access contracts, enabling the contract holder to run trains on GBS network and therefore make a commercial gain, will not be unduly affected, and the power will not be exercised lightly and would only be used for absolutely necessary changes, such as to reflect the creation of the GB of GBR. Now, I. I emphasize 1 or 2 of those words because they're quite flexible and for a private sector company borrowing hundreds of millions of pounds to procure trains to run a commercial operation, these aren't high margin businesses.
And even if the government makes changes which are only as far as possible and not unduly affected and and make changes are absolutely necessary, all of those things could be met, and you could still change the contract in a way that made it not commercially viable for the company to be running it, or where their investors would not otherwise have invested the money. And making those changes unilaterally and retrospectively, I don't think is acceptable. And the committee, the delegated powers Committee, said these assurances would not be necessary if the delegated power was more constrained, for example, by reference in the Bill to its purpose.
And the committee made the point that they don't judge delegated powers on how the government says it will use them, but on how any government might use them. So it's no good. The minister saying he's lovely and reasonable, and this government's lovely and reasonable, and it's not going to do certain things if it's able to. Any future government which he isn't able to bind could use those powers inappropriately. And the committee said the exercise of this power could interfere significantly with private contractual rights. And it said, well, there are mechanisms to ensure that train operating companies are protected to some extent because there are powers to provide for dispute resolution and payment of compensation.
They're mentioned in 712 creation of those mechanisms and the effectiveness of their protection are entirely at the government's discretion. There's nothing in the clause, as drafted that says there have to be provisions for compensation or mechanisms for dispute resolution. It says the government can do that, but it doesn't say the government has to do that. And in light of the government's intentions, the recommendation, the clear recommendation of the committee was the power in clause 711 should be amended so that it can only be used for purposes that give effect to those intentions. So, in other words, the things the government said it wants to do in the memorandum, the limits on which it's going to use that power, the committee is very clear that that should be constrained on the face of the bill.
The second thing it said final thing it said was that exercise of the power in clause 711 is subject to the negative procedure. The memorandum from the government says that's because this is a transitional and technical matter and that because of this, the affirmative procedure or the hybrid procedure that could be triggered by it would not be justified. But the committee said it is true that the power covers the transition between access regimes, and the resulting regulations are likely to be technical, but those are not in themselves . Reasons for avoiding the affirmative procedure . If the potential effect of regulations is sufficiently important that automatic debate by Parliament is appropriate, and avoidance of the hybrid procedure is a surprising approach to justifying the negative procedure.
Where private rights are sufficiently protected, it's common for bills to include a d hybridisation provision so that regulations to subject to the affirmative procedure don't trigger the hybrid procedure. Now, the power is currently drafted may be exercised to interfere significantly with private contractual rights, and parliamentary scrutiny of the delegated legislation has a role in ensuring appropriate protection of those rights, particularly if they are not sufficiently protected by the power itself. And so, the committee said. Its second recommendation said since the power in clause 71 1st May significantly affect private contractual rights, we recommend to the House that to ensure appropriate protection of those rights, it's exercises subject to the affirmative procedure.
So there's two very important recommendations there from the Delegated Powers Committee, which I think are very sensible and I think the government should respond to. Now, the Minister has referred on a number of occasions to the access and use policy, which TR is consulting on the draft model contracts that are in the future, access and use policy have mechanisms for unilateral variation, and although those proposals are not final and they're obviously being consulted on the fact that GBR is envisaging unilateral variation of contracts, I think reinforces the need for clear protection of the agreements that are currently in place, because it's clearly, clearly, given that they're consulting on having unilateral variation of contracts, it clearly is not outside their thinking that that may be something that they wish to do.
So the amendments that Lord Berkeley and I have tabled still allow the technical changes needed to keep those existing agreements operational as responsibilities transfer to GBR. But what they don't what they prevent is material rewriting of the commercial bargain, all the agreed allocation of risk, and they end at the start of GBR first funding period. So it's genuinely transitional and not open ended. And so my question to the minister is, if the government's intention, as it's set out in its memorandum to the Delegated Powers Committee, is genuinely that these are only to be used to make existing agreements work under the new structure.
Why is the government taking powers that go much, much further? And I would say to the minister that if he wants a private operators to have the confidence to continue to invest in delivering services which are enormously valued by the public. So the services, my noble friend Baroness Neville-rolfe, referred to the services provided by Hull Trains and Lumo Trains, enormously valued by the public and supported by members of Parliament along the line of route. If they want to continue making sure they exist and those private sector operators continue investing, then I think the minister should do what the Delegated Powers Committee has recommended and limit the power on the face of the Bill.
21:10
Speaker 15
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Speaker 15
My Lords, my amendment 270 in this group ensures that regulations made under this section cannot override or interfere with existing access agreements or rights held by non GBR infrastructure managers. There is concern, rightly or wrongly, and as we've heard today, that even the current open access operators are at risk once GBR comes into operation and all franchises are finally being run as a public service, this amendment seeks some reassurance from the noble Lord, the Minister, about the government's plans for open access and for the current access agreements in operation today and for many years to come.
Clarity and certainty is absolutely needed for this sector, and I look forward to the noble Lord the minister's response next Monday.
Clarity and certainty is absolutely needed for this sector, and I look forward to the noble Lord the minister's response next Monday.
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