Railways Bill (Second sitting)

Edward Argar Excerpts

Tuesday 20th January 2026 Public Bill Committees

[Baggy Shanker]

Q Are you saying that we do not need any changes in this area?

Steve Montgomery: We can modify it, but we need that comfort that it will be evaluated fairly and not have the constraints of GBR putting everything in front of it, saying, “We might use those paths in the future again”. We cannot have that; we need certainty. As I said earlier, we need the opportunity to allow investment in the railway. If private sector investment is coming in while there are paths sitting there not being used, that means that we are not funding the industry up to the capacity that it may have.

John Thomas: There are no protections in the Bill for open access operators. As Keir said, freight is mentioned at least 100 times and there is a freight growth target that GBR must have regard to, but there is nothing on open access. There is an inherent conflict when you have a body that will be granting access to its competitors. We would rather see the Office of Rail and Road still making those decisions. We accept that that is unlikely, because that is not the direction of travel from the Government, so as a minimum we think that a fair and non-discriminatory provision in relation to GBR decisions will help.

We think, as I said earlier, that the provision for ORR to have regard to the benefits of competition in hearing appeals will help. It will not be as sufficient as today. This is not part of the Bill, but we think that the access and use policy ought to carry on with the not primarily abstractive tests. It is not just because of lack of capacity that decisions have been rejected in the past; as Steve said, it is the revenue abstraction test as well. There is nothing to stop GBR increasing test in terms of the level of abstraction that is allowed before not granting access to open access operators. There is a lot to be worked through in the access and use policy to protect open access operators but, as I say, there is nothing whatsoever in the Bill to protect them at the moment.

Maggie Simpson: We recognise that the current system is not perfect, but my members want to understand two things: first, if they are running a train today that their supply chain relies on, that they can reasonably expect to be running that train in the future. Today, the ORR would have a presumption of continuity—forgive me, this is not in the Bill—so if we came to the end of an access contract they would let the trains go into the next one. The infrastructure capacity plan process is different: it throws everything up in the air. People are really worried that they will commit and invest against a service that their supply chain relies on, and then in future something else will be judged to be better value and they will be taken off the network.

Secondly, when people are looking at investments, whether that is a new port or a new terminal—a new interchange might be a £1 billion investment—they need to have a sense that the capacity for the trains coming out of that interchange will be there when they need to use it. The current system has more capacity for that. That is why clause 63 worries people, because they think that that capacity could be taken away from those trains.

John Thomas: Clause 71 is also a real concern for us, because it allows the Secretary of State to establish regulations to amend or even abolish access rights or access contracts. That seems quite a draconian power to us. We have been assured that that is not the intention, and that the intention is to use that power to amend contracts so that they are operable in the new structure. Our view is that the clause should be limited to enable contracts to be operable in the new structure, and not to give the Secretary of State unilateral powers to amend or abolish access contracts or access rights. Again, that will make private sector operators really nervous about future investment. I agree with Maggie: I get no impression that the current Administration would ever use that clause—but, if you are never going to use it, why have it in there?

[Edward Argar (Melton and Syston) (Con)]

Q A brief question from me: in this morning’s session my colleague Ms Smith highlighted 19—and counting—different documents, plans and strategies that are referred to here. This Committee has not had any sight of drafts of them yet and I am conscious that nor will you, but they will be fundamental to how this works or does not work in practice. Recognising that you have not seen the documents, what assessment would you make of the Bill’s provisions on how, for example, the access and use and the infrastructure capacity policies will be produced? How should they be produced to properly reflect both the needs of an effective railway and the multiple groups with a stake in this? How can they be framed to ensure that GBR, which will essentially be a monopoly provider with a weakened regulator, is meaningfully held to account for what it puts in those policies?

Maggie Simpson: My members and I are working collaboratively with Network Rail colleagues and DFT colleagues to try to ensure that those policies and plans are going to be written in the right way. It is fair to say there is a lot of work still to be done, particularly on capacity allocation. On track access charges we feel a little more comfortable with the Bill provisions and that we will get there, but on capacity allocation there is a huge amount of work yet to be done.

Some of that work is practical stuff around the interplay between capacity plans on different routes, regions and sections of network, which could be quite big or quite small, and how we wind a freight train through what could be 10 or 20 different infrastructure capacity plans. There is a lot of work to do. There are great people working on this, so let us hope that they get there.

In terms of how GBR is held to account, that is a macro question for this Committee across a lot of different aspects. There are lots of powers in the Bill that you will have seen going in both directions between GBR, the Secretary of State, the regulator and so on. Our focus is on that appeals function, which I have already spoken about.

[Edward Argar]

Q Gentlemen, do you have anything to add?

Steve Montgomery: I do not think we have much more to add, other than that, given the way the Bill is written at the moment, how can you be comfortable with what is in the Bill when you cannot see what is in the licence conditions that are going to be set out? As it stands, clause 63 at the moment can override everything. We would need to see how, when you word the Bill in a certain way, and then the licence, we can get more comfortable with it when they write it up in the access conditions.

John Thomas: The licence is a bit of a worry for me, because of all the indications, as we have been discussing, of ORR’s weakened powers. For example, it will not be able to enforce business performance in future. It will be able to advise the Secretary of State, who can then decide whether to take enforcement action or whatever action she deems necessary. That is a far cry from the current licence, which is a much stronger Network Rail network licence. We have not seen it yet, so we cannot really comment, but all the indications are that it would be a much weaker licence for GBR than under Network Rail.

As Maggie said, there has been good communication with DFT and Network Rail on the access and use policy, for example, but what are the checks and balances on GBR to create something that is fair and non-discriminatory? As one example, the charging framework is really good. It is based on the current framework of cost directly incurred plus a mark-up; it says—this is a point of detail—that if the operator can bear it, it needs to revert back to whether the market can bear it. On the whole, the provisions are good, but there are different ways of calculating charges even based on those principles. My worry is this: what is the incentive on GBR not to increase charges to price people off the network in order to support its own services? As long as there is good engagement and GBR, in the future, and Network Rail and DFT now, listen to us, that is all we can do at this point in time.

[Laurence Turner (Birmingham Northfield) (Lab)]

Q As I did in this morning’s session, I draw attention to the fact that I am a member of Unite. I have a few short questions, primarily to Ms Simpson to start with. We heard from some of our witnesses in this morning’s panels that they would like to see a passenger growth target in the Bill on an equivalent basis to the freight growth target. I am interested in your reaction to that proposal.

Maggie Simpson: It is not my business to talk about the passenger railway. We see two things as important in having a freight growth target: first, it is a statement of Government commitment to growth, which is hugely powerful; secondly, and importantly, the people who are going to be running GBR are going to spring out of bed every morning and say, “It’s my job to make my trains run on time,” and the freight growth target makes them say, over their Weetabix, “Yes, and I must make freight run on time as well.” It is the incentive effect of having a growth target.

We have seen that effect really powerfully with the freight growth target that the Scottish Government and Whitehall have set, in that it changes the dynamic and the culture. I think—perhaps you would say I am biased— that people think about the passenger railway all the time, so I do not see that that incentive effect is as necessary—but in terms of other factors, I leave that to others.

John Thomas: May I add to that? I think a passenger growth target is really important. At the moment, the duties for GBR only include improving performance. You can improve performance, as we saw during covid, by cutting the number of services, but that is not necessarily in the best interest of customers. We think a balance between a performance target and a passenger growth target is really important.

--- Later in debate ---

[Laurence Turner]

Q Picking up on a point that was made by witnesses on our devolution panel, the geography of, say, West Midlands Rail Executive does not overlap entirely with the geography of the combined authority. Similarly, there might be a case for reaching a clause 5 agreement with more than one mayoral authority at the same time. Does the clause as drafted allow the flexibility to reach an agreement directly with, say, West Midlands Rail Executive, or a combined agreement with the East Midlands combined county authority covering the cross-country service?

Keir Mather: I think we have been really clear, and the provisions in the Bill support this, that GBR needs to be organised locally so that it can work really collaboratively with local leaders, and it is through the business units that it has to devolve that responsibility to as close to decision-makers as possible. MCAs are the right level, in terms of being a catalyst for economic and housing growth, but you are right that the challenges around rail infrastructure and service provision, even though the solution to a lot of them may be set by MCAs, are inherently cross-border. I would expect GBR to be able to fulfil a role in facilitating the ironing out of those differences, for the good of everyone, on a cross-border basis.

[Edward Argar]

Q One of these questions will hopefully allow for a yes-or-no answer; the other might be just a date. First, we have heard a lot from witnesses about how much is in the Bill, but also how much is not, and how it is reliant on the building blocks. Will the Minister commit to publish a draft of the licence before the Bill leaves the Commons so that it can be considered by MPs?

Keir Mather: Yes.

[Edward Argar]

Q Thank you. Secondly, one of the most important things for passengers is the cost of rail travel, so when will passengers under this Bill and this plan see fares not just frozen but reduced?

Keir Mather: We think there are benefits from consolidation in terms of building a more efficient railway, which we are confident will be able to build a more efficient system for passengers. We hope that that will reduce costs. The Secretary of State also has power through the Bill to set guardrails on fares, which are a really important part of the system. Unfortunately, I have not brought my crystal ball with me today on the exact time when fares may increase or decrease.

[Edward Argar]

Q Finally, it has been indicated that GBR’s ticket functions, website and app will be subject to the code of practice, and in theory enforced by the ORR, backing this up. Ben Plowden highlighted that in his evidence, and others mentioned it. Is it the case that GBR’s ticket functions will be subject to the code of practice in full?

Keir Mather: It is my understanding that GBR’s functions and operational work when it comes to ticketing will be subject to the code of practice, yes.

[Andrew Ranger]

Q On the devolution aspect, how does the Bill reflect the interests of passengers and businesses’ needs, particularly in Wales, and ensure that the Welsh Government have sufficient input into decision making?

Keir Mather: The Bill requires the Secretary of State to obtain the consent of Scottish and Welsh Ministers before they issue a direction that directly affects passenger services. That means that there is a robust ability for the devolved Administrations to play their role in thinking about how we have joined-up services. In Wrexham and across north Wales that is incredibly important, as we go through into north-west England.

It is also important that GBR is able to carry out work across the four nations that does not conflict with the aspirations of the devolved Administrations to pursue their own rail ambitions. For example, the Scottish Government have stated very clearly that they want to pursue a vertically integrated railway. GBR needs to complement the aspirations of the devolved Administrations and create close bases on which we work.

I am really pleased to say that it seems that, from a Scottish Government perspective, they are happy with the balances and accountability measures in the Bill. They think—I would not want to put words in their mouth, but they can correct me if I am wrong—that it forms a strong bedrock upon which we can start to take these conversations forward.