Rolling Stock (North of England)

Stephen Hammond Excerpts

Wednesday 12th March 2014 Westminster Hall

[The Parliamentary Under-Secretary of State for Transport (Stephen Hammond)]

I thank the hon. Member for Penistone and Stocksbridge (Angela Smith) for calling this debate on an important topic. Much has been made of what I may or may not say today, but I intend to cover directly some of the issues she has raised because the matter is important. Some people have suggested things I may say, but I will answer her questions.

There have been a huge number of contributions and I learned today that brevity is a virtue, and that the hon. Member for Glasgow South (Mr Harris) is a voice of experience and sanity. I always enjoy following the hon. Member for Nottingham South (Lilian Greenwood), who leads for the Opposition. She leaves me in awe of the fact that she can operate in a parallel universe. Is the real failure the 900 miles of electrification that this Government have committed to, as opposed to the nine under her Government, or is it the 11% rise in fares that would have happened had her Government been in power today?

I had an opportunity yesterday, during a Westminster Hall debate, to pay tribute to Bob Crow and to send condolences on behalf of the Government to his friends and family. Whatever our political differences, he was a doughty defender of his members and of safety standards, and I am pleased to reiterate that today.

I understand the frustrations that have been expressed today, but there must be recognition, as there was from some hon. Members, about the contribution and huge investment going into the north of England. The north of England investment plan will see £1 billion invested to improve services, to increase capacity and to ease overcrowding over the next five years. That massive investment will see electrification of the north-west triangle between Manchester, Liverpool and Wigan. The TransPennine route between Manchester and York via Leeds will also be electrified. Capacity improvements are being delivered between Manchester and Sheffield via the Hope valley line and the Chat Moss line between Liverpool and Manchester. Construction of the Ordsall chord will enable trains to run between Manchester Piccadilly and Manchester Victoria stations.

[Tom Blenkinsop]

Will the Minister give way?

[Stephen Hammond]

I will not give way, because I have only eight minutes.

Line speed improvements will be made on routes including those between Manchester and Sheffield, Manchester and Preston, and Manchester and Bradford. Whatever anyone says, that is a huge investment in the area. It is estimated that the wider economic benefits to the region will be more than £4 billion and have the potential to create 20,000 jobs. The Government are investing in the north of England. However, all those projects have an impact on rolling stock decisions and we are taking a broader look across the country to see why some of the problems—I accept that there are problems—have arisen. The significant steps that we are taking towards electrification throughout the country, including in the north, undoubtedly means that the rolling stock market is preparing to invest heavily in electric units. There is less demand for diesel units, and there is a short-term mismatch.

Everyone agrees that electrification will help to transform the railways by introducing faster, greener and more pleasant vehicles. It will also set up the opportunity for cascades of newly run-in and refurbished stock to other parts of the country to meet rising demand. Moreover, it is not just investment in infrastructure that will make a difference to services in the north. The intercity express programme is a major investment in rolling stock that will bring benefits to regions throughout the country and faster journey times both north and south. The programme will create new jobs in the north and will be fully implemented by 2020. The first trains being built at Newton Aycliffe by Agility Trains will bring about more reliable services. That context is important and shows the huge investment that is taking place.

I will now respond directly to some of the questions that have been asked today. The issue with the TransPennine rolling stock relates to nine Class 170 trains, which comprise 18 rail vehicles—not a higher number. Those vehicles are equivalent to approximately 9% of the total fleet. The lease for those trains expires in 2015, which is the end of the current franchise.

[Julie Hilling (Bolton West) (Lab)]

Will the Minister give way?

[Stephen Hammond]

I will not give way, but I will come on to Bolton in a moment.

As is usual in the commercial rolling stock market, the lease was offered from that point. The opportunity was taken up by Chiltern Railways, which agreed a new lease earlier this year. Hon. Members asked when the Department for Transport knew about that. It knew in October 2013 and the Secretary of State saw a lease in February. The Department was aware of the lease, but we cannot unreasonably withhold consent for it, so it was given.

Today, I have heard from many hon. Members about their concerns and I can report that the Government are well aware of the problem and will ensure that a solution is found. Discussions are taking place between Chiltern Railways and First TransPennine Express to allow the ongoing TransPennine franchise to retain the trains until May 2015. That will allow more time for a solution to be found. Discussions are taking place about how many of those trains Chiltern will need in 2015, and an opportunity will exist for TransPennine to retain some of the units until March 2016.

Commercial negotiations are taking place between the Department, Chiltern and others in the industry that will allow medium and long-term solutions to be found. The Department has made it clear that it expects train operators and rolling stock companies ultimately to resolve the situation, but it is equally clear that several possible solutions exist. By working in partnership, the Department can reach a positive outcome that will continue to provide the level of service that passengers are currently experiencing.

Comments were made about section 54 notices. They are only a one-way guarantee. Each guarantees the lease price, not that the lessee will not move the vehicles anywhere else. In addition, it is not contractually secure to transfer leases from one tenant franchise to another.

Some amusing but untrue comments and jokes were aimed at the Prime Minister. Anyone who knows the railways knows that Chiltern does not serve Witney, which is served by First Great Western. Moreover, it is important to make a point of accuracy that no one else has mentioned. Notwithstanding the issues involving TPE and the solutions the Government are putting in place, TPE is also taking delivery of 10 new Desiro EMUs immediately.

In the same vein, much has been said about Bolton and what might happen following the December timetable change. I met hon. Members from Bolton last week, and I understand the difficulties faced by passengers on that route. I am confident that an agreement will shortly be reached whereby electric rolling stock will operate on some services between Liverpool and Manchester from December 2014 and enable diesel trains to be released to address the capacity issues in Bolton and at the Todmorden curve. I assure my hon. Friend the Member for Burnley (Gordon Birtwistle) and the hon. Member for Penistone and Stocksbridge that that is not a failure of strategic planning, but will see services running on that section of track for the first time in more than 40 years.

Much has been said about the Pacer trains that were introduced in the mid-1980s and have rightly received their fair share of attention. With the introduction of new rolling stock into the region, higher quality rolling stock will be released for use across the network. In the forthcoming franchise competitions for Northern and TransPennine Express, the Department does not intend to specify the type of trains to be used. However, hon. Members will have seen the Official Journal of the European Union notice that we set out for the East Coast franchise and we expect to ask bidders for the Northern franchise to put forward proposals for the removal of Pacers from the area. Furthermore, as hon. Members will have noticed, the new franchise competition gives as much weight to quality as to price aspects of bids, so we expect bidders to take that opportunity to reflect that in their bids and operating plans.

Some hon. Members have contended that the Government favour the south over the north. [Interruption.] The reality, of course, is a completely different picture. The Department is taking a whole-network approach, investing heavily in services across the country for the better of all passengers in this country.

Rail Franchise Agreements

Stephen Hammond Excerpts

Wednesday 12th March 2014 Commons Chamber

[The Parliamentary Under-Secretary of State for Transport (Stephen Hammond)]

I thank my hon. Friend the Member for Portsmouth North (Penny Mordaunt) for securing the debate, and indeed for her closing remarks—I give all thanks for God’s good fortune that I am a Minister. I hope that she will take some comfort from my remarks about the changes we have made to the franchising system since re-establishing it in March 2013, as some of the things she spoke about are now integral to the new franchising process.

As we heard, my hon. Friend has been an extraordinary doughty campaigner on behalf of the constituents in relation to the service from Portsmouth. I know that there is a significant file of correspondence between my Department and her on the subject, and I know that she has previously secured debates on the matter in the House.

Although I am tempted to use the three hours available, that might not find favour with you, Madam Deputy Speaker, so I will limit my remarks to the standard length for Adjournment debates and speak for about 15 minutes. I will talk first about the franchising process and the reforms we have made, and then address some of my hon. Friend’s specific comments and offer some words that hopefully will help her as she continues, quite rightly, to campaign to ensure the best for her constituents.

It is important that we understand exactly what a franchising process is and the general principles the Department follows in that regard. Strictly speaking, as most people understand, a franchise agreement is merely a contract between the Department and the operating company that sets out the responsibilities of each party. In many ways that is what we are buying through the privatised railway. Our franchise agreements contain a number of schedules, all of which include obligations that the train operating companies and the Secretary of State have to one another.

It is also pertinent to the debate to point out that when we make a franchise agreement with a private sector partner we go through a number of processes to ensure that the process is run correctly and is free of influence. The Secretary of State announced a new franchising programme in March last year, including, for the first time, a long-term schedule and the direct awards that we will make. That ensures that the process can be for the long term, that bidders can bid correctly and that there is the right number of bidders in the process to ensure value for money. We plan to update that schedule annually, and I or one of my colleagues will update the House on that in the near future.

The process the Departments undertakes has been set out in detail in the franchise competition and process guide. There are detailed changes from competition to competition, but the process is broadly simple. However, there have been a number of changes that I think are pertinent. One of those changes—a huge change—has been in the consultation that takes place with the public and the rail industry. That is essential to the ongoing franchise programme. We are revising our public consultation procedures to ensure that we consult as widely as we can when setting objectives for new franchises, and that has dramatically increased the amount of consultation that the Department undertakes.

In recent competitions, we have worked extensively with Network Rail and the Office of Rail Regulation, but also, more importantly and pertinently for the issues that my hon. Friend raises, with Passenger Focus and, particularly in the London area, with London TravelWatch. That has ensured that the wider industry and the wider interests outside the bidding community have been involved in looking at what should be the proposed specifications. We are asking organisations to provide in future their own advice on bidders’ responses to franchise competitions. We have also spoken to Members of Parliament, local authorities and other local groups, and consulted widely with the Rail Delivery Group and the bidders themselves to ensure that our propositions are robust and deliverable. All those groups now have a chance to make a significant contribution to, and have a significant impact on, the specifications. It is absolutely key to the new franchising process that the Government have committed to that level of engagement as we move forward, and there has clearly been an improvement.

As my hon. Friend said, the privatisation of the railways has seen an industry that was in decline turn into a resounding success story. We are now moving into a crucial period where Government, having reset the franchising process, must work in partnership with the private sector to build on that success. That is why the process has been restarted. We are taking steps to improve the way in which we contract with the private sector. That has been highlighted most recently in the new contract procedure that we are undertaking with the east coast main line, where we set out a prospectus that provided for consultation with the public and the rail industry, as I described, before the invitation to tender. We in Government need to deliver the highest quality specifications in invitations to tender which ensure that the bids we get mean that the franchise arrangements will deliver the best possible rail services for passengers and taxpayers.

The second point that is key in understanding the changes to the franchising process that we have undertaken in the past year is that, for the first time ever—this is one of the biggest changes we have made—we are taking into account non-financial factors in our assessment of bids. We are doing this right now as we evaluate the bids for the Essex Thameside and the Thameslink, Southern and Great Northern franchises. In the past, ever since the start of rail franchising, we have scored bids only on the financial elements and the elements that deliver a return in terms of premium or reduced subsidy. The financial factors are obviously important, but as my hon. Friend said, the quality of service that passengers receive, and therefore the quality aspects of bids, must be taken into account. The Department now does that, particularly when, as is often the case, the financial aspects are relatively closely matched and the quality aspects can be a potential tie-breaker in the assessment of bids.

This has been put in place to drive a certain set of behaviours in bidders, which, in turn, drives a certain set of changes to the bid and the outcome for passengers once the franchise agreement is in place. Putting quality into the bidding process is not only changing the mindset of bidders but, most importantly, putting the passenger at the forefront of the franchising process. We have recognised that in the past this process has not always delivered for the passenger or the taxpayer, and that is the rationale for the change. These are often rightly referred to as the quality issues, and they will improve the experience of passengers.

Each franchise competition will inevitably assess its own approach to quality and consider the balance between affordability and appropriateness with regard to the objectives that the Secretary of State and the private sector hope to achieve in the franchising process. It will also consider the ways in which we can improve the experience for passengers and the long-term value for the taxpayer.

The Department recognises the need to provide the right environment to encourage the continuing success of the railways. A large amount of my hon. Friend’s speech rightly centred on the rolling stock. The Department faces some considerable capacity issues. The increase in the number of people wishing to travel on a number of routes means that we need to find ways to increase capacity.

People who travel often want to sit and I understand the tensions my hon. Friend has referred to with regard to the rolling stock on the Portsmouth to London line. The class 450s that were put in place by Stagecoach South West on that route have undoubtedly increased the seating capacity, but she is right to raise issues about how that capacity is reached. There is a regional trend towards the common adoption of three-plus-two seating in standard class, which allows more passengers to be seated and fewer to be required to stand, but I recognise that there is a judgment to be made on comfort.

My hon. Friend referred to an interesting report that concludes that a seat that is judged to be comfortable can lead to some pain and that, conversely, a seat that is judged to be uncomfortable may cause no damage at all. Although the report rightly highlights some of the possible complaints about the 450s and their formation, I am not sure that it is as conclusive as has been suggested to her campaign. None the less, she is right to point out that the 450s have implications for many of her commuters who do not regard them as comfortable. Therefore, as I pointed out, the new franchising process seeks to achieve a balance between affordability and quality. We must consider whether the balance between capacity and the appropriate comfort of passengers is right.

I would be delighted to meet my hon. Friend to discuss in some depth the merits of the 444 as against the 450 and its appropriateness for her commuters. I also hope that my rather long explanation of the franchising process—although it could have been much longer—has led her to recognise that there has been change that allows for the possibility of new services that would be of benefit to her commuters. I would very much welcome her contribution on that and I am sure we will discuss it at our meeting. A semi-fast Portsmouth Flyer, or even the Mordaunt Express—which would be an excellent innovation—would be possible under the new franchising process.

One of the aspects that I have not described in more detail is that, while we are setting minimum temporary speed restrictions as a train service requirement, we are also giving points to bidders to consider how new markets and opportunities, which the new capacity we are building and the huge Government investment in the railways afford, can be incorporated in the new franchise agreements. When we start the refranchising process for my hon. Friend’s line, I would urge her to take the opportunity to engage in that process. There is a real opportunity to influence it. I hope she will take it and I am sure she will make that point at her meeting with me.

My right hon. Friend the Secretary of State has quite rightly said that we need to put passengers at the heart of franchises. The changes that we are making to the franchising process are starting to make a real change in ensuring that passengers are central to the franchise competition. We are now consulting them, and we are looking at the possibility of using innovation to take that consultation through the evaluation process, so that the quality provided to passengers is assessed in the bidding process for the first time ever.

It is a new and changed process, and I hope that my hon. Friend agrees that it will certainly start to make a potential difference to her commuters when we put the line’s new franchise process in place in two years’ time. As I have just said, I am delighted to have the opportunity to meet her in the interim. I hope that my remarks have given her some comfort that the Government recognise the plight of the Portsmouth commuter and recognise that some changes are possible.

Question put and agreed to.

Transport Infrastructure (Wellington, Somerset)

Stephen Hammond Excerpts

Tuesday 11th March 2014 Westminster Hall

[The Parliamentary Under-Secretary of State for Transport (Stephen Hammond)]

It is a pleasure to see you in the Chair, Mr Gray. I congratulate my hon. Friend the Member for Taunton Deane (Mr Browne) on securing the debate, but it would be wrong of me not to start by saying how saddened I was to hear the news that Bob Crow died in the early hours of this morning. My thoughts are with his family, friends and colleagues. Like many, I will obviously remember him as a passionate advocate of safety on the railways and the well-being of people who work on the railways. Although it is probably clear to everyone that we may have had different opinions on how to run the railways, he was a man who led his organisation from the front and made an important contribution to the debate about how railway services are run in this country. My thoughts and, I am sure, the thoughts of everyone in the Chamber are with his family, friends and colleagues.

I commend my hon. Friend the Member for Taunton Deane for his eloquent and passionate speech. I listened to his opening remarks about the improvements in Taunton and clearly I welcome his support for the improvements that have been undertaken there. Of course, I also commend his realism in recognising that money is tight. That is a helpful prefacing remark.

The economic benefits of good transport are well understood and, in challenging times, transport investment is even more important. As my hon. Friend has pointed out, transport helps to support local communities by enabling businesses to move people and goods more quickly, easily and reliably, which helps them to grow and be competitive; by enabling people to get to work and creating more job opportunities; by supporting local projects and products such as Relyon mattresses, for which we heard an admirable advertisement; and by attracting inward investment to towns and cities to make them great places in which to live and do business.

It is useful to remind ourselves—this was implicit in my hon. Friend’s remarks—that the Government inherited not only a fiscal deficit but an infrastructure deficit. In the years leading up to 2010, there was a huge increase in demand on our transport network, but investment failed to keep up with that demand. As a result, nearly half of the respondents to a CBI survey at the time rated the UK’s transport network as well below average. It is to the Government’s credit that, at a time when we are trying to put the public finances in a sound place, we are investing record amounts in maintaining, upgrading and expanding the road and rail infrastructure in this country, investment that will, according to the International Monetary Fund, improve the long-run growth potential and boost demand.

Between 2011 and 2014, we invested £32 billion in roads, rail and local infrastructure, and between 2015 and 2021 we are committed to funding of £56 billion. We ensure that that money goes throughout the country. In the current two fiscal years, the Somerset block funding for road maintenance and highways maintenance will consist of more than £40 million. It is clear that the Government are committed to investing in reliable networks and providing the capacity that towns and cities across the country need.

The severe winter weather that we have suffered has made some parts of the network extremely vulnerable. As my hon. Friend knows, Somerset has had particular difficulties, so it is right that my right hon. Friend the Secretary of State for Environment, Food and Rural Affairs announced last week the publication of an action plan, which contains several transport recommendations. In addition to £10.5 million of funding from the Department for Environment, Food and Rural Affairs and the Department for Communities and Local Government, the Department for Transport is making £10 million of support available immediately to Somerset to enable it to start work on several short-term actions to help secure a sustainable future. As a result, I hope that Somerset will be able to begin to clear the roads of silt and debris, to deep clean the drainage system—that will help the road system—and to repair bridges and other structures. In addition, my right hon. Friend the Secretary of State for Transport has commissioned a review of the resilience of our transport networks. The challenge of the coming months is to get the network back to business as usual, to learn the lessons and to give the right support to the transport infrastructure in counties such as Somerset.

The Government clearly have a role to play in supporting communities through such extreme events and, as my hon. Friend the Member for Taunton Deane identified, in supporting communities with their priorities for transport. However, the days when Westminster decided and dictated to local communities what those priorities should be are over. Local priorities should be identified, and local decisions made, by local communities, local highways authorities and local enterprise partnerships. That is why the Government have committed £2 billion a year over the six years from 2015-16 to the local growth fund, which will be available to LEPs. Those growth deals can provide the resources required to facilitate local communities’ priorities, and such deals may well be appropriate for some of the targeted growth priorities that my hon. Friend described. The funding is not ring-fenced, but it will be available to support long-term planning infrastructure, including the transport priorities.

Many hon. Members will be aware that the growth deals are a competitive process, and moneys will be made available to the places that demonstrate the clearest-cut and most convincing arguments for delivering growth. It is important for local communities to engage with their local economic partnerships, and for local authorities and LEPs to work together to shape local priorities. I know that my hon. Friend has been involved in discussions with his LEP, Heart of the South West. I stress how important it is for the ambitions that he has described that the LEP is intimately involved in the discussions and that it recognises and supports his priorities.

I turn to the two interrelated schemes that my hon. Friend has described. He spoke about the congestion in Wellington and the need for a northern relief road to bypass the town centre by connecting roads to the east and the north, which has long been sought. The development that he mentioned will provide much of the road. It will provide access to some of the new residential development and to the factory, and it should reduce HGV traffic in the town centre. As he pointed out in an article last November, however, it will not be a

“proper northern relief road…we have the road to nowhere.”

I understand his concerns about the continuing congestion, delay and air pollution that are caused by the fact that the road is unconnected. He set out two aspirations for a northern relief road: one modest and one—a broader sweep that would cross the railway line—more ambitious. Both those ambitions are excellent examples of the solutions that the local growth fund has been established to support. As far as I am aware, and he may wish to correct me, they have not yet featured in the draft of the LEP’s strategic economic plan. I urge him to engage with the LEP and ensure that it recognises that ambition as a strategic priority. That is a route through which the scheme might be pursued.

[Mr Browne]

If we were able to bring forward a joint vision for those two projects, would there be any national impediment to Wellington having a railway station? Would the Department for Transport object to that on the basis that it might have implications for other traffic on that line? That might not be an entirely local point, but it would be beneficial to local people if there was not a national impediment.

[Stephen Hammond]

I will come on to discuss the railway station in a moment, so I will tackle that point shortly. Local pinch point funds, of which there have been two tranches under this Government, have helped with schemes such as the rail route that my hon. Friend mentions. Such problems are likely to be a priority for a future Government, and if such a scheme is re-established in future I hope that he might look at it as a potential way forward.

My hon. Friend is right to say that people in Wellington see the train services going past, but the station was closed in 1964. Wellington is thought to be the largest town on the Penzance to London line that does not have an operational station. I am aware that Mid Devon district council and Devon county council have spoken about how they might work together to re-establish local rail links between Exeter and Taunton. I understand that Somerset council has a long-term aspiration to reopen the rail line, but it has yet to identify a suitable service or adequate funding.

To come to my hon. Friend’s essential point, if Wellington station were to be re-established, the issue would be to ensure that a stopping service that called at Wellington did not interfere with the timings for some of the faster services, or with the ambition to provide accelerated services to some of the key markets such as Plymouth, Exeter and further into Cornwall. He is right to say that whatever happened, not all services would call at Wellington. The best way to achieve a semi-fast service that called at Wellington, fitted in with the timetable and allowed faster trains to pass would clearly be a discussion point. I do not see it as an impediment, but it would be a discussion point. I suggest that the next stage is to consider the proposal and to work up a business case, so that that work can be developed in partnership with the local transport body and the LEP. My officials will be happy to provide advice and guidance on how a viable case might be made.

As I have tried to convey in my short speech, I strongly believe that local priorities and local decisions should be made locally. My hon. Friend has made an eloquent case for his local priorities, and one of the main routes through which those priorities might be pursued is the local growth fund.

Light Dues 2014-15

Stephen Hammond Excerpts

Thursday 6th March 2014 Written Statements

[The Parliamentary Under-Secretary of State for Transport (Stephen Hammond)]

The three general lighthouse authorities (GLAs) for the United Kingdom and Republic of Ireland provide an essential service for mariners through the deployment of coastal aids to navigation and inspection of harbour lights. The celebration of the 500th anniversary of Trinity House this year is helping to highlight the continuing vital role of these historic organisations. However this year and next will witness two significant changes affecting the GLAs.

In line with provisions in the Public Service Pensions Act 2013, the GLAs’ pension schemes will be closed and their members transferred to the principal civil service pension scheme, the rules of which the current schemes already follow by analogy. The reserves in the general lighthouse fund—above a minimum level required to maintain operational cash flow—will be used to fund this transfer, supplemented by a loan from the Department for Transport, which will be repaid through the fund over the next 10 years.

The transfer, which addresses the pension liabilities of the GLAs, will be of significant benefit to light dues payers. First it removes a source of volatility and risk for the general lighthouse fund from uncertainties arising in the way pension liabilities are valued. Secondly, it is a fundamental component of our actions to implement the agreement made in 2010 by the Irish and UK Governments that, from 2015-16, the work of the Commissioners of Irish Lights in the Republic of Ireland will be met fully from Irish sources.

In this way, the Government are laying the ground for a sustainable reduction in the call on the UK light dues payer, delivering on their commitment to creating the right conditions to support one of the UK’s most important industries.

On top of this, the GLAs have continued to improve the efficiency of their operations by working together, harnessing new technology, and a concerted programme of converting aids to navigation to use solar power. Therefore, I have decided to reduce the light dues rate by one penny to 40p per net registered tonne in 2014-15 and I intend to seek a further reduction in 2015-16, dependent on the final valuation of the liability and a decision on the appropriate minimum level of the general lighthouse fund. Following the freeze in light dues since 2010, this represents a 14% reduction in real terms under this Government.

DVLA Review

Stephen Hammond Excerpts

Thursday 27th February 2014 Written Statements

[The Parliamentary Under-Secretary of State for Transport (Stephen Hammond)]

I am today publishing the report on the review of the Driver and Vehicle Licensing Agency (DVLA), which I announced on 8 October 2013. The Department for Transport commissioned this review as part of its commitment to delivering improved quality and better value motoring services to the public, business and other interested parties.

The review has concluded that while DVLA is an effective organisation that is delivering important services, there is significant scope to increase efficiency. Strategic recommendations have been made covering DVLA’s digital transformation, reducing the burden on customers, modifying the governance and management structure and optimising DVLA’s value as a service provider for Government.

I am content to accept all of the recommendations in the report. I have asked the chief executive to prepare a strategic plan for DVLA on this basis, which prioritises those measures that will bring the greatest advantage to customers.

I am placing a copy of the review and my response in the Libraries of both Houses and on the Department’s website. I would like to thank Mary Reilly and the review team for their work.

Re-employment

Stephen Hammond Excerpts

Thursday 6th February 2014 Ministerial Corrections

[Lilian Greenwood]

To ask the Secretary of State for Transport how many staff have been made redundant or retired by his Department and subsequently re- employed since May 2010.

[Official Report, 24 January 2014, Vol. 574, c. 362W.]

Letter of correction from Stephen Hammond:

An error has been identified in the written answer given to the hon. Member for Nottingham South (Lilian Greenwood) on 24 January 2014.

The full answer given was as follows:

[Stephen Hammond]

In total 12 civil servants have been re-employed by either Department for Transport central or one of its Agencies having been made voluntarily redundant or retired by the same organisation since May 2010. This is a very small percentage (less than 1%) of external recruitment over that period.

The correct answer should have been:

[Stephen Hammond]

In total 10 civil servants have been re-employed by either Department for Transport central or one of its Agencies having been made voluntarily redundant or retired by the same organisation since May 2010. This is a very small percentage (less than 1%) of external recruitment over that period.

DSA Procurement

Stephen Hammond Excerpts

Wednesday 29th January 2014 Written Statements

[The Parliamentary Under-Secretary of State for Transport (Stephen Hammond)]

I am pleased to announce that, in accordance with the commitment previously given to reduce the costs of learning to drive, new contract arrangements will see a reduction in the cost of the driving theory test from September this year and savings in excess of £100 million over the next nine years.

The Government Procurement Service (GPS), an Executive agency of the Cabinet Office) and the Driving Standards Agency (DSA), an Executive agency of the Department for Transport and now merged with the Vehicle and Operator Services Agency (VOSA) into the new Driver and Vehicle Standards Agency jointly ran a competition to appoint a supplier for a framework contract to provide computer-based testing for the Government. The competition was concluded in early 2013. A call-off contract for the driving theory test—an essential part of arrangements to ensure road safety—has now been awarded under this framework.

The decision to award the framework agreement was subject to a formal challenge which prevented award of the agreement during the course of the challenge. To ensure continued supply of the driving theory test and a reduction in test fees, and in accordance with Government policy to manage disputes by the most effective and appropriate means possible, this dispute was resolved by agreement. This resolution enabled the award of a Government framework agreement to learndirect Ltd on 18 October 2013. Further, DSA and the Driver and Vehicle Agency Northern Ireland agreed that the driving theory test will be provided by learndirect Ltd from September 2016 and that the current provider, Pearson Driving Assessments Ltd, should continue to provide the test until that date.

The result of these contract arrangements has been to secure a very good, value-for-money deal. The reduction in net cost per test, allied to the Driver and Vehicle Standards Agency’s forecast of increased test volumes as a result of the economic recovery, means that more than £100 million will be saved over the next nine years. In addition, national coverage will be improved with tests becoming available at more locations.

As a consequence of the formal challenge and as a matter of good practice, the permanent secretary of the Department for Transport commissioned an independent review of the handling of the competition by officials in the Driving Standards Agency and other parts of the Department. This has now concluded. A separate report on the lessons that can be learned to inform future procurements will be published shortly. The National Audit Office has been apprised of these matters.

Nottingham to Lincoln Railway Line

Stephen Hammond Excerpts

Monday 27th January 2014 Commons Chamber

[Patrick Mercer (Newark) (Ind)]

May I thank your office, Madam Deputy Speaker, for making it possible for me to have this debate today? I should also like to thank the right hon. and hon. Members on both sides of the House who have supported the project. I will certainly allow them time to speak later, if they so wish. I thank East Midlands Trains for being helpful and supportive. I thank the Under-Secretary of State for Transport, the hon. Member for Wimbledon (Stephen Hammond), who has already given a lot of his valuable time to listening to what I and others have said about this matter. Most notably, I have received support from the hon. Member for Lincoln (Karl MᶜCartney), who came with me to see the Minister. I also thank the Minister for being present tonight, when I am sure he has other things that he would like to be doing—

[The Parliamentary Under-Secretary of State for Transport (Stephen Hammond)]

Dinner in 10 minutes, please.

[Patrick Mercer]

As the Minister said, his dinner is in 10 minutes, so I will be as brief as possible.

Newark has many, many assets, probably the best of which, as has been known since at least Roman times, is the ability to communicate quickly and effectively, particularly north to south, and south to north. During my time as a Member of Parliament, one of the things that I have noticed is that it is easy for me to get to London and back, but extraordinarily difficult to get to Nottingham in the west, and less difficult to get to Lincoln in the east. My rail communications inside the area are very good in one direction, but poor in the other.

It is interesting to note that on this 100th anniversary of the start of the first world war, I notice that soldiers from my old regiment, the Sherwood Foresters, were able to move by train more quickly in 1914, from Nottingham to Lincoln, than they are today. That cannot make sense. I would love to see the Minister in Newark; I do not know whether he is familiar with the area. I would like him to see the huge potential in the region, which was recognised by the decision to dual the A46 from Newark to Lincoln. However, we continue to be let down by rail services going from east to west and from west to east.

--- Later in debate ---

[The Parliamentary Under-Secretary of State for Transport (Stephen Hammond)]

I congratulate my hon. Friend the Member for Newark (Patrick Mercer) on securing this debate, which provides a further chance for him and other hon. Members to put the case on their constituents’ behalf, as they did in a long meeting with me last week.

The issues that my hon. Friend raised have to be seen in the context of the wider challenges for British railways and the way in which the Government are tackling them. It is undoubtedly true that we face the challenges of success. To support a growing economy and more jobs, we need to meet increasing demand. Since privatisation, passenger numbers have doubled and freight traffic has risen by 60%. In the next five years alone, we expect a further 14% rise in passenger numbers and at least 4%, possibly more, in freight. There is understandable frustration among rail travellers, and we need to tackle the issues of congestion and crowding.

At the same time, we need to tackle the wider challenge of deficit reduction, and the rail industry, along with everyone else, has to play its part. We need to deliver better value for money for the taxpayer and the fare payer, and underlying costs must fall across the industry. To address these and other challenges we are seeing the most significant rail modernisation package for generations. Between 2014 and 2019, Network Rail will invest over £16 billion in improving our railways, having spent over £8 billion in the previous control period.

That includes a number of projects that will directly benefit Nottinghamshire and Lincolnshire. The £150 million Nottingham hub resignalling and station redevelopment programme, which is nearing completion, will improve reliability, reduce delays and create the capacity to cope with increasing numbers of passengers. Electrification of the midland main line, only guaranteed and delivered by this Government, is currently limited to the route between London St Pancras and Bedford, through to Nottingham, Derby and Sheffield, but it will transform the rail route between London, the east midlands and Yorkshire, offering reduced journey times, improved reliability and new trains.

The region will also benefit from the new “electric spine”—a high-capacity electric rail freight route connecting the east midlands with Southampton, making it much more attractive for firms to locate in the east midlands and getting more freight off the road. There have been renewals on the Doncaster-Lincoln-Peterborough line to improve safety, capacity, journey times and performance, and there is a £240 million fund for increases in capacity on the east coast main line, which will bring benefits. That is all before the introduction of new intercity express programme trains on that line, which will transform the journey experience. In addition, from 2018, completion of the Thameslink and Crossrail projects will significantly improve connections from this region to Heathrow. The Government’s rail investment strategy from 2014 to 2019 rightly focuses on strategic priorities for the network, but it will benefit the east midlands as well.

[Mr Spencer]

The Minister is making a powerful case for the amount of money that the Government are spending in the east midlands, but I hope he accepts that most of the projects that he mentioned are on north-south routes—it is on east-west routes that we face the challenge.

[Stephen Hammond]

East-west is often a challenge across the country, and I am about to address that point.

I said that the Government’s rail investment strategy rightly focuses on the strategic priorities for the network but, in line with our localism agenda, it is right that local and sub-regional bodies, which are best placed to prioritise and fund investment for the needs of their areas and to support local economies, should come forward with their priorities. The rail industry did not identify the Lincoln-Nottingham route as one on which investment is a strategic priority for 2014 to 2019, so it was not included as requiring enhancements in the strategy. The strategy does however include funding for line speed improvements across the network and for improvements to level crossings. There is £300 million for journey time and performance improvements and £65 million to reduce the risk of accidents at level crossings. Network Rail will spend that in locations where best value for money can be attained. Decisions on the allocation of those funds could be influenced by a local capital contribution and a local assessment of need, which is usually headed up by local authorities and local enterprise partnerships. That is my point: localism and local authorities being able to influence and enhance the value of Network Rail’s investment programme.

Therefore, it is for Nottinghamshire and Lincolnshire county councils and the LEPs—D2N2 and Greater Lincolnshire—to determine whether investment and enhancement to services on this route to improve connectivity and support local economies is a priority for their strategic economic plans and should be included in a bid for funding to the local growth fund. The Government have committed to putting £2 billion per annum into the local growth fund from 2015-16 to 2020. Moreover, any subsidy requirement for the proposed additional service on the line would also need to be funded by the promoter, usually the local authorities, which would have to be in place for three years, after which the Department would consider taking on funding responsibility.

As I said last week in the meeting with my hon. Friends the Members for Lincoln (Karl MᶜCartney) and for Newark, the Government have set out this position very clearly, both to campaigners and to the local authorities concerned on a number of occasions. I reiterate, as I did to both of them last week, that so far the Department has received no comment from either Nottinghamshire county council or Lincolnshire county council. We have not seen a business case for the proposed investments and improvements. However, we have made it clear to both Nottinghamshire and Lincolnshire and the LEPs that we are willing to provide guidance and strategic advice. Neither of the two strategic enterprise partnerships has indicated that the scheme is a priority, and without support from those bodies, I regret to say that it is unlikely that much progress can be made in achieving the objective of improved services that Members have talked about this evening.

[Stephen Phillips]

It seems to follow from that that if this is merely an oversight on the part of the two county councils and the relevant LEPs and that is rectified, this is a project that the DFT will treat as a priority and that this funding will be forthcoming. Is that right?

[Stephen Hammond]

My hon. and learned Friend, in true legal style, poses an argument that has a number of assumptions within it that we might unpick. He will obviously want to go to the very first part, which is that he has heard me say several times in my remarks that we have encouraged the county councils, the LEPs and the strategic economic partnerships on a number of occasions to make the case. The Department has offered advice and guidance on how they might formulate that case, but it has not been forthcoming. Therefore, to say that this is an oversight might be quite a big presumption. However, were it to be an oversight, or even at this late stage, if those authorities chose to decide that this is now a strategic priority for them—my hon. Friend the Member for Newark nods; I made exactly this point to him last week—even at this late stage, the Department will consider their applications.

[Patrick Mercer]

I thank the Minister and I thank my hon. and learned Friend the Member for Sleaford and North Hykeham (Stephen Phillips) for his intervention. This is clear and proper guidance. This is exactly the point of this style of debate. Not only was his meeting very helpful, but now it is on the record and all our constituents will be hearing exactly what we the elected Members have to do to try to force this through and to get a fair hearing. I am grateful.

[Stephen Hammond]

My hon. Friend knows that it would have been easy for me to say some soft words. What I am saying now is probably not terribly good news for him. But he and all the elected Members here have often made the case, and I urge them all again to go to their local bodies, as I have previously tried to indicate. It is incredibly important that the county councils and the economic bodies in the region declare this a strategic priority. That will underline the importance of reconsidering whether the improvements to the line are a high priority for those bodies and, therefore, for the allocation of local funding, which is available. That could then be reflected in the local growth fund.

I say to my hon. and learned Friend the Member for Sleaford and North Hykeham (Stephen Phillips) that there is still a chance for that to happen, because the bids for the local growth fund are due by 31 March this year. It is still perfectly possible for local bodies to engage with Network Rail and its partners in developing a business case for the proposed enhancements and to put it forward for the local growth fund. Equally, it is still possible for those local bodies to develop a business case and put it forward as a priority for investment for the 2019 to 2024 control period. I recognise my hon. Friend’s ambition to have it earlier, but none the less that would still be possible.

My hon. Friend the Member for Lincoln reviewed his hopes, and I suspect those of Lincoln, for an increased through service between London and Lincoln. I certainly recognise the appetite for more frequent direct services between that city and London. I welcome the work on a business case undertaken by Lincolnshire county council in 2012. As he will know, I cannot commit at this stage to any additional services, mainly because the Department is currently evaluating the business case and the network impacts of running services to the locations not currently served by the east coast main line. However, I can confirm that a number of regions—Yorkshire, the north-east, the midlands and the east of England, including Lincolnshire—are in that evaluation and assessment process. Depending on the outcome of the work, the invitation to tender for the east coast main line franchise might include a requirement or an option for bidders to run services to a specific number of locations.

[Karl MᶜCartney]

It is obviously of the utmost importance that any invitation to tender includes a specification for the eventual winner of the franchise, which is what we in Lincoln want to see. On that point, with regard to cross-country services, might not a franchise extension that brings an improvement that we are seeking between the line from Lincoln and Newark to Nottingham see an improvement in the specification of services?

[Stephen Hammond]

I hear what my hon. Friend says about specification. The Department is keen to give options to bidders for initiative and innovation in the franchise. He may wish to pursue that, because he might find that it is the way to secure what he desires, rather than the Department directly specifying things.

The train service requirement will be set out in the invitation to tender, which will be published by the end of February, so it would be imprudent of me to comment on that any further. However, as I have said to my hon. Friend the Member for Newark and other hon. Members, I will be happy to brief any hon. Members on the proposals for the ITT at that stage.

I welcome the opportunity to set out the Government’s position on how enhancements to that line could still be progressed, even at this late stage, were the local authorities to get themselves in line. I welcome the opportunity to see that the line could build on the massive programme of investment that we are already seeing across the rail network. The Government remain committed to working with local authorities and local enterprise partnerships to see improvements to the line and others, should that be a priority for them. But I say to hon. Members again—I know that they will have heard me say this—that the ball is in the court for them to hit heavily at their local authorities. I hope that the local authorities will then decide to demonstrate that commitment to the investment that they are asking me to provide this evening.

Question put and agreed to.

Transport

Stephen Hammond Excerpts

Friday 17th January 2014 Ministerial Corrections

[Katy Clark]

To ask the Secretary of State for Transport which existing rail franchise contracts (a) have been or (b) he plans will be renewed by direct award to the incumbent operator; and at what stage negotiations with the incumbent operators has reached in each such case.

[Official Report, 13 January 2014, Vol. 573, c. 393W.]

Letter of correction from Stephen Hammond:

An error has been identified in the written answer given to the hon. Member for North Ayrshire and Arran (Katy Clark) on 13 January 2014.

The full answer given was as follows:

[Stephen Hammond]

As per the franchising timetable announced by the Secretary of State for Transport, my right hon. Friend the Member for Derbyshire Dales (Mr McLoughlin), on 26 March 2013, a number of new franchise contracts need to be negotiated via Direct Award. These are new franchises, not extensions of existing contracts.

Direct Awards have already been negotiated with Essex Thameside (c2c) and First Great Western. The contracts began in May 2013 and October 2013 and will run until September 2014 and July 2016 respectively.

The Department has recently received the proposal for Greater Anglia, the Direct Award for which will commence July 2014 and run until October 2016. We are in negotiation with Northern and First Capital Connect whose Direct Awards will run from April 2014 to February 2016 and April 2014 to September 2014 respectively.

The Department is preparing the Requests for Proposal for TransPennine (April 2015—February 2016); Intercity West Coast (November 2014—November 2017); South Eastern (October 2014—June 2018) and South West Trains (February 2017—April 2019). We are in initial discussions with London Midland (September 2015—June 2017); East Midlands Trains (April 2015—October 2017) and Cross Country (October 2016—October 2019).

The correct answer should have been:

[Stephen Hammond]

As per the franchising timetable announced by the Secretary of State for Transport, my right hon. Friend the Member for Derbyshire Dales (Mr McLoughlin), on 26 March 2013, a number of new franchise contracts need to be negotiated via Direct Award. These are new franchises, not extensions of existing contracts.

Direct Awards have already been negotiated with Essex Thameside (c2c) and First Great Western. The contracts began in May 2013 and October 2013 and will run until September 2014 and September 2015 respectively.

The Department has recently received the proposal for Greater Anglia, the Direct Award for which will commence July 2014 and run until October 2016. We are in negotiation with Northern and First Capital Connect whose Direct Awards will run from April 2014 to February 2016 and April 2014 to September 2014 respectively.

The Department is preparing the Requests for Proposal for TransPennine (April 2015—February 2016); Intercity West Coast (November 2014—November 2017); South Eastern (October 2014—June 2018) and South West Trains (February 2017—April 2019). We are in initial discussions with London Midland (September 2015—June 2017); East Midlands Trains (April 2015—October 2017) and Cross Country (October 2016—October 2019).

Inter-city East Coast (Rail Franchising)

Stephen Hammond Excerpts

Friday 17th January 2014 Written Statements

[The Parliamentary Under-Secretary of State for Transport (Stephen Hammond)]

Today the Department for Transport has announced that the following companies have successfully pre-qualified to bid as part of the inter-city east coast franchise competition.

East Coast Trains Ltd (First Group plc);

Keolis/Eurostar East Coast Ltd (Keolis (UK) Ltd and Eurostar International Ltd; and

Inter City Railways Ltd (Stagecoach Transport Holdings Ltd and Virgin Holdings Ltd).

In order to pass the pre-qualification evaluation each of the bidders had to demonstrate that they have the financial strength, legal, safety and operational experience to run this premier franchise. This is a further key milestone in our franchising programme in line with our published timetable and marks the next step in securing improvements for passengers on inter-city east coast services.

The Department plans to issue the invitation to tender to these companies by the end of February and they will then have three months to consider and develop their bids that will deliver benefits for passengers and long-term value for the taxpayer. The Government expect the new franchisee to commence services in February 2015.