West Coast Main Line

Lord Davies of Oldham Excerpts

Monday 29th October 2012 Lords Chamber

[Lord Davies of Oldham]

My Lords, from time to time the noble Earl has a moment of difficulty at the Dispatch Box, but never one of such ignominy as to have to address himself to this Statement, which has already been delivered in the other place. It is noticeable that when Ministers are in control of their departments and the departments are carrying out their policies efficiently, you often hear them refer to “my department”. I repeat part of the Statement, although the Minister has already read it out, which states,

“because of the discovery of unacceptable flaws in the procurement process run by the Department for Transport”.

How remote that body appears, given that the Secretary of State is commenting on it. Like all other Ministers, the Secretary of State wants to be as remote as he possibly can from the shambles represented by today’s Statement and the answers we have had to Parliamentary Questions in the interim period. Nothing is more indicative of the failure of the Government than for the Minister again to emphasise today the independent nature of the reports being carried out. One of them will be carried out by a member of the departmental board. I have no criticism at all of Mr Laidlaw, who I know to be an extremely independent minded, efficient and proper individual. However, to ask him to carry out an independent review not just of the board but of Ministers as well when he is a member of the board, serving those Ministers, beggars description in terms of what this Government are prepared to defend in the wake of this shambles.

I have one or two precise questions to ask the noble Earl but I want him to be absolutely clear that the way in which Ministers have set about tackling this great difficulty with which they are confronted is not acceptable, and that they will have a difficult time on every occasion when they discuss these matters in one House or the other. We now know that some indication of difficulties with regard to this process was discovered as early as May 2011, with one executive telling the Financial Times with regard to the spreadsheet analysis of the bid:

“The spreadsheet contained certain assumptions that looked odd to our economic modellers, so we went back to the department and pointed it out”.

What did the department do? It ploughed on in its reckless way. Ministers did not intervene. Is it conceivable that when these difficulties arose Ministers were not informed? What grip did they have on the department when such a significant process was undertaken? I emphasise that this is the first of a series of decisions which have to be taken on these franchises. There are many more to come. Therefore, this matter ought to have been worked on in a very real sense as the model which dictated how all the others would subsequently be analysed. However, we have Ministers purporting to be so distant from the process that they knew nothing about these difficulties until months after the relevant events occurred. In fact, action was not taken by the department but when one party decided to take the issue to the High Court the department was forced to initiate a review. I take it that at that point Ministers at last took an interest in what was going on and forced the department to analyse criticisms of the process. At that late stage it was recognised that the process was flawed and had to be brought to a halt with very considerable costs.

So far, the department has owned up to the fact that the mistake may cost £40 million. However, everyone connected with the industry knows that that is only the start of the costs. The Secretary of State may stick to his figure but we know that this is just the cost of compensating the four bidders for the west coast main line franchise. It does not include the cost of rerunning the competition twice, preparing Directly Operated Railways to step in, or compensating bidders for the other stalled franchises because many months of delay are now built into the whole process.

It is clear that the department has been advised in this process by external companies which, of course, have provided their services at a cost. What steps is the Minister taking to review whether the department received value for money for well over £1 million spent on a flawed process, the results of which had to be jettisoned?

As regards the legal advice which the department has received, what is the department’s liability if any of the participants in these cancelled or stalled franchises seek costs from the Government as a result of the delay? What advice did the Minister receive on EU competition law, procurement law and the impact on the fairness of future competitions before deciding to extend Virgin’s contract? The noble Earl has emphasised what an excellent decision it was to extend Virgin’s contract. However, there were very few alternatives. Virgin is going to run the railway for the next 14 months although it was told that it was not as good at running it as the preferred bidder, according to the evidence which was provided and on which Ministers took a decision.

This Statement is a cover not for open government at all: it is a cover for a shambles.

Disabled People: Blue Badge Scheme

Lord Davies of Oldham Excerpts

Thursday 25th October 2012 Lords Chamber

[Earl Attlee]

My Lords, I should make it clear that the blue badge scheme has no effect off road on private land. However, supermarkets are bound by the provisions of the Equality Act and need to provide disabled parking bays. I am quite confident that a supermarket will take into consideration that a blue badge is on display and I would imagine that most responsible supermarkets would do their best to avoid abuse of disabled parking spaces because it is a morally bankrupt thing to do.

[Lord Davies of Oldham]

The Minister has adduced two reasons for why there may be improvements to the blue badge scheme. The first is that it may reduce fraud, which we would all welcome. The second, which I think much of the House would be very doubtful about, is that doctors have been too lenient in the past and that it is best if they are kept at some distance from the issue. In that case, what estimate has the department made of the reduction that is likely to occur in the number of blue badges issued?

[Earl Attlee]

My Lords, in future, the number of blue badges to be issued will depend on the results of the consultation and on what decision Ministers make. Our problem is that the passported benefit is from the personal independence payment rather than the higher rate mobility component of the disability living allowance. That is going to be a different system. It is bound to produce a variation but we do not know exactly what that variation will be. Another difficulty is that the data sets are quite poor, so it is difficult to assess what the outcome will be.

Government: Cars

Lord Davies of Oldham Excerpts

Thursday 25th October 2012 Lords Chamber

[Earl Attlee]

My Lords, the reason for that was in one of the very first answers I gave—that the motor industry supply chain is very much international. Another point to remember about government procurement is that we are bound by the European procurement rules, which restrict our course of action. However, we are 50:50 British and foreign in the fleet.

[Lord Davies of Oldham]

My Lords, an undoubtedly British car is the London taxi, which is symbolic of everything London stands for in terms of transport. The company Manganese Bronze is in very serious trouble, to the extent that 400 taxis have been withdrawn because of steering difficulties and the firm is not able to manufacture any others. This is extremely serious as far as the London taxi service is concerned, which is of course valued by very large numbers of people. Has the department begun thinking about the answers to those problems?

Isles of Scilly: Helicopter Services

Lord Davies of Oldham Excerpts

Wednesday 24th October 2012 Lords Chamber

[Earl Attlee]

My Lords, we could make a public service obligation if the market failed. The market has not yet failed. In addition, there would have to be a competitive bidding process. We do not want to interfere at this point because we want to see whether there will be a commercial solution to the problem.

[Lord Davies of Oldham]

My Lords, the Minister has given some encouraging news about the increase in services, but he will appreciate that the House is still greatly exercised about communication with the Scilly Isles, particularly during winter. If we find that the Scilly Isles are effectively cut off for a number of days in winter, I hope that the Minister will return to this issue and take some action.

[Earl Attlee]

My Lords, I assure the House that my honourable friend Mr Norman Baker takes these matters very seriously and is on the case.

Railways: Franchises

Lord Davies of Oldham Excerpts

Wednesday 10th October 2012 Lords Chamber

[Baroness Royall of Blaisdon]

To ask Her Majesty’s Government, in the light of the reply by Earl Attlee yesterday, whether they will clarify how they intend to review the mistakes made in awarding the west coast main line franchise; what assessment they have made of the propriety of a review being conducted by a departmental non-executive director; what the cost will be of (a) reviewing the mistakes made, (b) making interim provision for operating the line and (c) reissuing the tender for the franchise; and what initial actions they have taken to avoid any other rail franchises being affected.

[Lord Davies of Oldham]

My Lords, I wish to ask the Question of which my noble friend the shadow Leader of the House has given private notice.

[Earl Attlee]

My Lords, first, I refer to the answer that I gave the House yesterday. The Secretary of State has asked Sam Laidlaw to look into the west coast procurement process with the support of independent advice. This review is due to provide findings by the end of October and it would be premature to speculate on them. A second review will examine the implications for the wider franchising programme. Both reviews will be published reports. As I said to the noble Lord, Lord Adonis, yesterday, if there are any questions about the thoroughness and integrity of Sam Laidlaw’s inquiry, I shall be happy to debate these when his findings are made public. It is in the interests of the taxpayer that the review is conducted swiftly and thoroughly, and I have every confidence that the Laidlaw review will uncover exactly what went wrong and why.

[Lord Davies of Oldham]

My Lords, the question asked by my noble friend Lord Adonis yesterday, to which the Minister referred, indicated that these reviews are being carried out by officials in the department that is in the middle of this debacle, and they will inevitably involve the conduct of senior officials, including probably the Permanent Secretary, and Ministers. Therefore, how can they be carried out effectively by junior Ministers? Furthermore, how can the Minister justify the point that was addressed to him in another question yesterday? Ministers received warning of flaws in the franchise process on 10 August, a month before both the Secretary of State and the Minister of State were somewhat surprisingly reallocated to departments far away from transport.

[Earl Attlee]

My Lords, the noble Lord asked how Sam Laidlaw and Richard Brown can perform their duties. The answer is that they will do so with integrity, and I am sure that the noble Lord is not suggesting that they are unable to do that. He also suggested that officials have acted in bad faith. I can assure the House that there is no evidence whatever of officials having acted in bad faith. It is a serious mistake but there is no evidence of bad faith.

Railways: Franchises

Lord Davies of Oldham Excerpts

Tuesday 9th October 2012 Lords Chamber

[Earl Attlee]

My Lords, it is a little early for me to answer in that much detail, but the process for the western region is being paused. However, the difficulty, of course, is with the west coast main line franchise.

[Lord Davies of Oldham]

My Lords, the House should congratulate the noble Earl on being one of two junior Ministers in the department who have survived. Is it not the case that the other Ministers who presided over this debacle scuttled just before the news broke, thereby denying the absolutely fundamental principle of parliamentary democracy that the buck stops with Ministers?

[Earl Attlee]

My Lords, that was a good try. We will have to see what the reports come out with.

Energy: Biofuels

Lord Davies of Oldham Excerpts

Monday 8th October 2012 Lords Chamber

[Earl Attlee]

My Lords, I do not know what research has been commissioned but I would like to inform the House of one of the difficulties with biofuels, which is some of the complex effects of indirect land use change. For instance, if you start using tallow as a biofuel then the use of certain types of tallow could increase the demand for palm oil, which could have effects on land use change far away from the United Kingdom. It is a complicated area. There is research into understanding this, but I am not sure what research the Government are directly commissioning.

[Lord Davies of Oldham]

My Lords, will the Government consider doing what several other European Governments are doing and separate bioethanol and biodiesel in the RTF obligation, thereby offering the possibility of avoiding exactly the problem he identified regarding what might suit large traders and significant commerce as well as the small businesses providing this very important service at a more local level?

[Earl Attlee]

My Lords, the danger, which we are drifting into, is providing state support for small businesses. We must provide the regime with the incentive from the renewable transport fuel obligation, but we must be careful not to provide state aid to certain types of businesses.

Crime: Drink-driving

Lord Davies of Oldham Excerpts

Monday 8th October 2012 Lords Chamber

[Earl Attlee]

My Lords, the only thing that my department is concerned about is saving lives by having an effective policy. That means correctly allocating resources and addressing the most serious problem, which is persistent unregulated drinkers who consistently flout the law and drive with very high blood-alcohol levels.

[Lord Davies of Oldham]

My Lords, the noble Lord has referred to the report of Sir Peter North. He stated that he thought that, if the limit were lowered from 80 milligrams to 50 milligrams, 168 deaths a year would be saved by such action. Surely, that is a compelling argument for the Government to consider.

Earl Attlee: My Lords, it would not be if it diverted police resources from the much more serious problem of those who pay no regard whatever to the law.

Aviation: Policy

Lord Davies of Oldham Excerpts

Monday 23rd July 2012 Lords Chamber

[Earl Attlee]

My Lords, I can confirm that I have received numerous e-mails on this particular subject, and I will be very surprised indeed if the noble Countess does not pursue the matter vigorously on Report. I am looking forward to the debate.

[Lord Davies of Oldham]

My Lords, is not the Government’s policy since coming to office one just of dither and delay? They have taken one decision—to abandon the third runway proposal at Heathrow—but have taken no other constructive position at all. Is it not about time that the Government stopped looking for the long grass, or the long Recess, in which to run for cover on this issue, and for the Minister to say that by next spring—three years after this Government came to power—they might have some proposals to put before the nation? It is quite scandalous.

[Earl Attlee]

My Lords, it is not quite right to say that we have done nothing about Heathrow. First, we introduced the operational freedoms that will make it easier for Heathrow to recover from any disruption during the day without having any more unscheduled night flights. In addition, we have just announced the western rail access to Heathrow, so the argument that we have done nothing is not a good one.

Railways: Electrification

Lord Davies of Oldham Excerpts

Wednesday 18th July 2012 Lords Chamber

[Earl Attlee]

My Lords, I would hope that the party opposite, if in power, would have carried on with the process of giving us a railway system that is fit for the people of the United Kingdom

[Lord Davies of Oldham]

My Lords, the “party opposite”, of course, produced the plans and had commitments for half the money which is to be expended on these proposals by this Government, expenditure which did not take place immediately after the election because the Government themselves induced the delay. Of course, we welcome the Government’s intention to make progress on electrification. Although the noble Earl referred in glowing terms to the HS2 project, we also note that there is no commitment in these proposals to the expenditure for HS2 and we wonder whether in fact the Government are running a little scared of their Back-Benchers, as they have been recently in the other House.

[Earl Attlee]

My Lords, I can assure noble Lords that the Government are not running scared of their Back-Benchers in respect of HS2. I would also remind the noble Lord that we are currently in CP4, which was devised by the previous Administration. The announcement is for CP5.