Julian Huppert
Main Page: Julian Huppert (Liberal Democrat - Cambridge)Department Debates - View all Julian Huppert's debates with the Department for Transport
(11 years, 8 months ago)
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Maria Eagle
I knew it began with a “Ch”—that might be a way to remember it in the future. The right hon. Gentleman has not taken too long to get back into the habit of heckling from the Front Bench—perhaps he never got out of it in his role at the Department of Health.
My noble Friend Lord Adonis has made it clear in oral and written evidence to the Transport Committee, and on many other occasions, that he fully intended the ban on train companies flexing the fare cap to continue into subsequent years. That would be perfectly possible. I have said on many occasions that the previous Government should have taken action earlier, but the fact is that when times got tough they acted, but when times got tougher still this Government chose to give back to the train companies the right to fiddle the fare cap.
Maria Eagle
No.
What is the consequence? It is that the Government and the House do not have the ability to enforce the cap on fare rises they think they have approved. I therefore hope that we can all agree today that the cap should be precisely that—a cap, a maximum allowable increase.
Our motion also calls on the Government again to reverse their decision to increase the cap from RPI plus 1 to RPI plus 3 for 2013-14. This should not be a contentious proposal, and I hope that Members on both sides of the House will feel able to support it. I know that it is slightly devalued today, but Government Members might like to look back at the commitment they made in the coalition agreement:
“We are committed to fair pricing for rail travel”.
It simply is not credible to square that pledge with the decision taken to increase the annual cap on fares from RPI plus 1 to RPI plus 3.
Let us be clear who is benefiting from these excessive fare rises: the private train companies. I urge the new Secretary of State to ask his civil servants for a copy of a very good report—on his Department’s spending settlement and its progress in implementing it—recently published by the National Audit Office. It warns that the Department for Transport has failed to demonstrate that higher fares translate into payments back to taxpayers:
“There is a risk that the benefit of the resulting increase in passenger revenues will not be passed on to taxpayers fully, but will also result in increased train operating company profits.”
So there we have it. We know who benefits from fare rises: the private train companies.
Maria Eagle
The hon. Gentleman is right that there is a choice to be made about where to pitch the figure for RPI plus or minus whatever it is. Today’s motion is based on our current policy as it is—something I think the Government could agree with—which retains credibility in terms of deficit reduction, but which would also bring significant relief—[Laughter.] I do not know why Liberal Democrat Members are laughing. Despite their alleged policy to cut rail fares, they have voted repeatedly in this Parliament for Budgets, autumn statements and comprehensive spending review measures that increase rail fares by RPI plus 3%, so we are not going to take any lessons from them about how to implement policy on rail fares.
Maria Eagle
No, I will not.
Why is a 3% above inflation increase acceptable this year, when it was, in the Chancellor’s words, “too much” last year?
Maria Eagle
I am not sure that the hon. Gentleman listened to what I said earlier, but I have already said that I did not think it was right to tie such increases into specific improvements on specific lines, which is what happened in that case, and I have said that before. Perhaps if he listens a little more carefully, he will not have to intervene. I said that I did not think that was right, but the current Government—
Maria Eagle
I am in the middle of answering the hon. Member for Gillingham and Rainham (Rehman Chishti).
The current Government are proposing an across-the-board increase of RPI plus 3% on everyone, whether or not there is any improvement in investment or any increase in service. At a time like this, when people’s incomes are being squeezed badly, it is not easy for them to cope with that. We should not continue with those levels of increases.
Maria Eagle
I will give way to the hon. Member for Cambridge (Dr Huppert), because he is clearly very keen.
Dr Huppert
I thank the shadow Secretary of State for finally giving way—it has taken some effort. While she is in the mood for apologising for errors made under the last Government, will she apologise for the fact that rail fares went up in cash terms by 66% in that time? That had a huge impact on people across the entire country and made fares completely unaffordable for many people.
Maria Eagle
The hon. Gentleman, who purports to be the transport spokesman for the Liberal Democrats, even though the Liberal Democrats have a Transport Minister in the Government—the Under-Secretary of State for Transport, the hon. Member for Lewes—is going round the country saying that his party is in favour of cutting fares, when he and his hon. and right hon. Friends are voting for Government measures that increase them. If he starts to apologise for some of that, I am sure we can sit down and talk about mutual apologies that may or may not be possible.
Maria Eagle
I will not give way to the hon. Gentleman again.
As the Secretary of State’s predecessor rightly said, “If you don’t ask, you don’t get.” That is the first thing that he can do in his first Cabinet meeting—well, not his first, but his first in this role. [Interruption.] Oh yes, the Chief Whip attended, but this time he will be able to vote, if there are any votes—there are occasionally votes at Cabinet, although perhaps not in this one.
We now know that many Government Members agree with us on this issue, because they have been busy telling their local newspapers that the fare rises are too high. The hon. Member—soon to be the right hon. Member—for Sevenoaks (Michael Fallon), who is now the Minister of State at the Department for Business, Innovation and Skills and who is, we are told, even now parked in a tank on the lawn of the Business Secretary, has gone so far as to present a petition to the House on the issue. He writes on his website:
“At a time of rising energy bills, and high inflation more generally, many of my constituents are having to make painful savings in their household budgets. Southeastern need to understand this and reduce the size of the rail fare increase”.
Our motion today would not only prevent train companies from imposing the eye-watering fare rises that the Business Minister rightly opposes; it would also cap his constituents’ fare rises at 1% above inflation.
The hon. Member for Harlow (Robert Halfon) has told his local newspaper:
“Harlow people are already struggling to make ends meet against a backdrop of rising petrol prices and wage freezes…They cannot be expected to pay massive rises in rail fares on top.”
The hon. Member for Chatham and Aylesford (Tracey Crouch) told her local paper:
“At a time when household budgets are stretched, the Government and Southeastern have a responsibility to ensure the cost of rail travel remains affordable. I will continue to make representations on behalf of my constituents”.
Good for her! Her neighbour, the hon. Member for Rochester and Strood (Mark Reckless), has said:
“What I have found with prices going up this fast is that many of my constituents have to get up at 5 am or 6 am to take a coach to London because they cannot afford to take the train whereas others have been priced out completely because they are spending almost all their take-home pay on a season ticket. I just think that is counter-productive. I think it is a question of fairness to people who are working hard and just doing their best.”
I agree with all those hon. Members’ representations.
I should also like to quote one or two Liberal Democrats. It will not be a great shock to the House to learn that many Lib Dem MPs have been sending out press releases to their local papers opposing their own Government—we all know that they do that. The hon. Member for Leeds North West (Greg Mulholland), who is not in his place, has said:
“I am very concerned at the proposed fare rises…At a time when the cost of living remains a big issue it’s not acceptable to ask rail users to pick up extra costs”.
The hon. Member for Manchester, Withington (Mr Leech) has actually claimed credit for last year’s U-turn, saying:
“I hope George Osborne and the Treasury will cut the train commuter some slack in the upcoming budget...Last year, Nick Clegg and Danny Alexander negotiated a RPI+1% fare rise for 2012, much lower than planned by some Conservatives. I hope they will do at least as much this budget.”
That is not very collegiate, but it is rather typical. I must not leave out the hon. Member for Cambridge, because he gets upset if I do. I can reassure the House that he has also spoken out, in his rather confusing role as co-chair of the Lib Dem transport committee. He has assured his local paper:
“I wrote to the Secretary of State for Transport earlier this summer to remind her of Liberal Democrat policy, and highlight our opposition to the RPI+3% rate.”
Putting out a press release is one thing—and it can be useful—but I hope that Members will follow their words up with action this afternoon and vote for this very straightforward motion, which proposes that the cap on annual fare rises should go back to the 1% above inflation cap that existed before the last election—which even the Chancellor conceded was right last year when he performed a U-turn—and that we should strictly enforce that cap, it being the will of the House, and not allow private train companies to add up to another 5% on to some fares. The result would be clear. Instead of 11.2% being the highest possible fare increase in January, no fare would rise by more than 1% above inflation. That would benefit our constituents considerably.
If we do not act, passengers are likely to face three years of double-digit fare rises on some routes, and many ticket prices will have risen by a third during this Parliament. We have reached a point at which increasing numbers of households are paying more on their season ticket just to get to work than on their mortgage or rent payments. For too long, Governments have let the train companies get away with treating passengers in a way that would not be permitted in other industries.
Mr McLoughlin
I was just coming on to say that this July, we announced £16 billion of public support for the existing rail network between 2014 and 2019—I expect 2014 to be during this particular Parliament—which will support over £9 billion of enhancements, meaning more services, more seats and more capacity, especially for commuters to our largest cities. The tap cannot simply be turned on as far as the rail industry is concerned. Passengers will also benefit from the completion of the northern hub in Manchester, £240 million of investment in capacity and connection improvements on the east coast main line, and a further £300 million for high-value, small-scale schemes in other parts of the country.
We are delivering a rolling programme of rail electrification on the Great Western main line to Swansea, on the valley lines into Cardiff and on the trans-Pennine route connecting Liverpool, Manchester, Leeds and York. We are creating a new “electric spine” for freight and passenger services stretching from the south coast to the east and west midlands and south Yorkshire.
Dr Huppert
I congratulate the Secretary of State on his new post. How confident is he that during this Parliament this Government will be able to electrify more of the railways than the nine miles that were managed in three previous Parliaments?
Mr McLoughlin
The hon. Gentleman must not underestimate the achievements of the last Government. He said that they electrified nine miles, but he is wrong; they electrified 13 miles, and I shall come to that a little later in my speech. I shall also come on to announce the electrification that we intend to carry out.
Dr Julian Huppert (Cambridge) (LD)
I welcome the new Secretary of State for Transport to his role. I also pay tribute to the work of the former Secretary of State, the right hon. Member for Putney (Justine Greening), and wish her the best of luck in her new, very important role in heading up the Department for International Development. It was a great pleasure to work with her to try to achieve many of the things to which we both aspire. I hope that that work can continue with the new Secretary of State and the other new Transport Ministers, whom I welcome to their roles, and the Under-Secretary of State for Transport, my hon. Friend the Member for Lewes (Norman Baker), who, I am delighted to say, is still in his role, holding the Department together in so many ways.
One of the issues on which we will have to work together is rail fares, which are quite simply too high. Under the previous Labour Government we saw year-on-year rail fare rises, and we now have one of the most expensive railways in the world. In their 13 years, rail fares went up by an astonishing 66% in cash terms—well above inflation—and in some years there were even greater increases. In 2007, for example, they allowed Stagecoach South West to increase fares by a massive 20%. Fares are too high already, but even now Labour and the Conservatives continue to argue for above-inflation rail fare increases. Although it was good to hear the new Secretary of State say that he aims to end the era of above-inflation increases soon, I hope that it will be very soon.
I will not support the motion because I do not agree with Labour Members that fares should be allowed to go up by more than inflation, which is what their motion says. It calls for a 1% above inflation rail fare cap, whereas Liberal Democrats believe that rail fares are too high already and should be reduced in real terms—that is, capped at less than inflation. We have argued that consistently and will continue to do so. It is time to end the era of above-inflation fare increases for ever.
The last-but-one Transport Secretary—I believe that 24 living people have had that job—instituted a policy of RPI plus 3%, which is well above inflation. Thanks to pressure from Liberal Democrats and others, and arguments won by the former Secretary of State, we managed to reduce that, and fares rose by only 1% above inflation—the average of the Conservative and Lib Dem proposals, and exactly what Labour advocated and advocates today—rather than by 3%. I congratulated the former Secretary of State on successfully winning that argument with the Chancellor last year. I have continued to work with her and other Ministers to try to press it. It was kind of the shadow Secretary of State to read out my words, confirming that I continued to press the former Secretary of State and will keep going with the new Secretary of State. I was delighted when the former Secretary of State announced in August:
“I am keen to see what we can do to keep fares down to something affordable. I will be looking at whether there is a way of doing this in the autumn.”
I am sure that the new Secretary of State, with all his vast experience in the ways of operating within Government and the Whips Office, will prove equally adept at obtaining the funds that are needed so desperately to ensure that price rises are reduced, and I look forward to working with him to achieve that.
We need to look at why fares are so high and how we can reduce the costs of the railways. Why do commuters in Britain suffer some of the most expensive tickets in Europe on some of its most crowded services? We have already heard some comments about this. I pay tribute to the interesting suggestions of the hon. Member for Wirral South (Alison McGovern), particularly on printing more information on tickets. That is an excellent idea and I hope that the Department for Transport will listen to it and take it seriously.
At the fundamental level, the main problem is chronic underinvestment in our railways. Government after Government have invested far too little in our most important transport network. Infrastructure spending has not kept up with demand. That has forced the railways into a downward spiral. An overcrowded, inefficient and unreliable service becomes far more expensive to run. The Office of Rail Regulation estimates that UK railways are up to 40% less efficient than their European counterparts, despite the cost of tickets. This cycle forces up fares and reduces the level of investment available, making for more expensive railways and a less good service.
Katy Clark
I agree with the hon. Gentleman, in his capacity as Liberal Democrat spokesperson, that historically there is a massive problem with underinvestment on Britain’s railways, but does he accept that the fragmentation of Britain’s railways and the role of the private companies compounds the problem greatly?
Dr Huppert
I thank the hon. Lady for her comments. She has been fairly consistent on this issue, which is not true of all those in her party. I was interested to note that the shadow Secretary of State carefully avoided making commitments on how the railway system is operated. At the time of privatisation, I was concerned about some aspects. For example, if I want to travel from Cambridge to London, I do not care if it is cheaper to go to Liverpool because I am trying to go to London. It may be cheaper—or wonderful—to go to Liverpool, but it is not the trip I wish to make. Having said that, renationalising now would create a huge amount of complexity in trying to move to that new world. I am not persuaded that it would be the right thing to do, but I would be happy to discuss it further with the hon. Lady.
Caroline Lucas
The hon. Gentleman suggests that it would be too difficult to bring the railways back into public ownership. If it were done on a case-by-case basis as the franchises came up, as with the west coast main line right now, there would not be any extra cost to the public purse; in fact, there would be a reduction in cost.
Dr Huppert
I thank the hon. Lady for her comments. I congratulate her on her new-found freedom and hope that she will enjoy not having the responsibilities of party leader, with the flexibilities that that brings. I suspect that she will continue to be very influential on future leaders of her party. I am happy to talk to her in more detail about how such an approach would work, but I do not think that it is as trivial as she suggests. We must avoid doing something that seems very good on the face of it but does not deliver an improved rail system. For example, passenger usage numbers went up quite significantly at the point of privatisation. I would not want to do anything that jeopardised the growth in the number of rail passengers, and I am sure that she would not want to do so either.
So what can we do to bring down rail costs? We need a more modern and more efficient system. That is why I was so pleased that despite the huge public deficit and the ongoing problems in the eurozone, this year over £9 billion of investment was announced for our railways in the next five-year period. The Liberal Democrats and I were delighted to endorse that. The coalition has committed to electrifying over 800 miles of railways across the country, as well as to making a huge range of other improvements that will make a huge difference to passengers and to business. I was interested that last year’s autumn statement announced £1.4 billion of investment in our railways because, crucially, that provides £400 million more for railways than for roads. I cannot remember the last time any Government took the correct decision to prioritise expenditure on railways over roads.
As well as investing in lower fares for the future, we have to invest in lower fares now, as the excellent Campaign for Better Transport has pointed out. Over the next year, wages are set to rise by 2%, but fares could go up by as much as 3% above inflation—over 6%. Coalition means that one does not always get everything that one would most like to happen. I was pleased that last year the Government moved to RPI plus 1%, which is exactly in between our position and that of our coalition partners, but I cannot support the Conservative proposals for a rise of 3% above inflation for next year, nor the proposal in the Labour motion for above-inflation rises indefinitely. Liberal Democrats want a rate of RPI minus 1%, with fares coming down in real terms from now on. A lot of that would come from the 30% efficiency savings identified by the McNulty review. A previous Secretary of State announced that that money would be split between investment and money going back to the Treasury. We think that more of it should be used to bring rail fares down now and give the money back to people who pay. We would go further to simplify the fare structure and make it much more transparent, and make rail companies put forward the cheapest fares possible and pay refunds when services are below par. The Government are making some progress on that, but we will continue to push for more.
I am delighted that the Government have taken the difficult decision to invest in railways for the future. That is not an easy thing to do when times are tight; it would have been far better to invest more during the boom years. However, if we punish commuters and other travellers now, it could put people off railways altogether, especially those who are just starting work and those who are hardest hit by the ongoing squeeze. That would send out a terrible message about the affordability of public transport, drive down passenger numbers, and put our network on an unsustainable path. As the Campaign for Better Transport says, we cannot allow our railways to become a rich man’s toy. We need to find an agreement again over rail fares that will last for the rest of this Parliament. I strongly urge the Secretary of State to take up this cause strongly, as his predecessor did.
I hope that the Government will continue to look at the long-term strategic projects that are happening. To restore our railways to their Victorian zenith, we need a Victorian level of investment, and a vision to match. That is why I am delighted that the coalition is not only spending more on the railways than any of its predecessors since the Victorian era but committing to projects such as HS2. I am delighted that that is finally happening, but I am disappointed that, for decades, so many opportunities have been missed for greater improvements like that. Our lack of high-speed rail epitomises what has gone wrong in our railways in recent years, why fares are now so high, and why we face such capacity constraints. For years we watched European neighbours and Asian partners develop and build a comprehensive high-speed railway network. They have extended capacity, supported rail freight, released space on roads and reduced congestion. Despite calls over many years from Liberal Democrats, including my hon. Friend the Under-Secretary, British Governments felt that the cost of doing so was too high. Why invest the money when there is nothing to be gained in the here and now? Transport investments take time to deliver.
Those Governments, over many decades, were wrong. We have waited so long that we absolutely have to go ahead with it now. The west coast main line will have already reached capacity before the new high-speed line can be finished, and the costs now have to be borne in a downturn rather than during the growth years, when money was more plentiful.
It is right that we are putting our railways on a sustainable footing. They need investment and they need it for the long term. The burden cannot be taken by fare payers. Constant, year-on-year fare rises are utterly unsustainable; they will ultimately force people off the railways and bring down revenues. Governments have found it much easier to just patch up old lines and force passengers to deal with the same old problems and pass on the cost of an inefficient system. That was a terrible waste of the boom years.
I am delighted that by the end of this Parliament, Liberal Democrats in government will have made some of the tough decisions to make sure that we will have the efficient and sustainable railway network we deserve, but it has to be affordable to people. I hope that over the coming months we can reach an agreement with our coalition colleagues to prevent an RPI plus 3% rate; otherwise, a long-term investment could be utterly undone as we drive people from our railways irrevocably.
Lilian Greenwood (Nottingham South) (Lab)
I join colleagues on both sides of the House in putting on the record my congratulations to the new Transport Secretary on his appointment. It is fitting that he should have made his debut in this debate. I know he is unable to be in the Chamber at the moment, but I am sure he will look carefully at all the arguments put forward by colleagues.
I listened very carefully to the Transport Secretary’s contribution, and was somewhat disappointed that he said very little about rail fare increases. Perhaps the Under-Secretary of State for Transport, the hon. Member for Lewes (Norman Baker), will say more about them, or perhaps the Secretary of State will return to fare increases in the coming days or weeks as he finds his way in his new brief and tell us exactly what he will do to protect passengers, what he thinks about the flex system, and whether he will lobby the Chancellor to keep rail fare rises to RPI plus 1%, as the Opposition propose. The Transport Secretary has an opportunity to push for the reintroduction of a real cap on fare rises, and I very much hope he takes it.
This debate has been about the general and the particular. There is a general crisis in the cost of living. Household budgets are under enormous pressure as living costs climb ever higher. The Opposition have called today for the Government to take a particular action—a further U-turn that would be welcomed by the constituents of all hon. Members in the Chamber. The Government could reverse their decision to allow the dramatic rise in rail fares, which, for many people, have come at the worst possible time.
The Government could resist the growing burden on hard-pressed passengers. The Labour Government put in place a strict cap on rail fare rises of 1% above inflation. It is a cause of great regret, both in the House and more importantly in the country, that the current Government chose to give the rail companies free rein over regulated fares. The removal of the cap, coupled with the restoration of flex, will lead to fare rises of up to 11%. That is a real blow at a time of pay freezes in both the public and the private sectors, higher-than-expected inflation and a contracting economy. The Campaign for Better Transport has warned that the cost of season tickets will go up three times faster than salaries. Without economic growth, the pain will only increase in intensity.
My hon. Friend the Member for Wirral South (Alison McGovern), who is not in her place, clearly explained how many people, particularly commuters, need to travel at particular times and cannot shop around for cheaper fares in the off-peak or super off-peak periods. They must simply pay up and see their disposable income hit. To give just one example, when one of my constituents needs to commute from Nottingham to Leicester to go to work, a season ticket currently costs £1,672 a year. Under the Government’s plans, it is estimated that that figure will rise to £1,937 by 2015, which would represent 7.38% of the average regional salary. Pity the commuter from Leeds to Hull whose season ticket will go up from £3,732 to £4,323, an eye-watering 16.5% of the average regional salary. In the most extreme cases, a season ticket could cost up to 25% of the average salary.
As my hon. Friend the Member for Harrow West (Mr Thomas) noted—and the hon. Member for Northampton South (Mr Binley) agreed—commuters in the south-east are routinely spending 15% or more of their salary simply on getting to work, and many will be priced out of work altogether. The example given by the hon. Member for Brighton, Pavilion (Caroline Lucas) was helpful in that respect.
The issue is not just affecting commuters. As my hon. Friend the Member for Huddersfield (Mr Sheerman) said, this also hurts businesses in his constituency whose staff need to travel to London to sustain and grow future business. Meanwhile infrastructure spending is being scaled back and the Government seem set on using the McNulty report as cover to withdraw staff from stations, despite many passengers relying on them to find the cheapest fares, which—as many hon. Members have pointed out—cannot easily be done using automated ticket machines, never mind the other concerns about unstaffed stations.
The fare rises will also have a particularly serious impact on those on low incomes, including pensioners and young people, who are already feeling the squeeze as the cost of living rises. When I speak to young people in my constituency the cost of transport is one of the key concerns that they raise, and I think the high cost of train travel comes as a real shock to many of those leaving home for the first time to go to university. For pensioners, the fare rises are compounded by cuts to alternative modes of transport. Bus services have been cut back and the withdrawal of support for long-distance coach travel is hitting pensioners hard.
Before the last election, someone said:
“The fares issue will not go away. It will be the biggest inhibitor of train travel in the years to come.”—[Official Report, 25 February 2010; Vol. 506, c. 166WH.]
Those are not my words, but those of the Under-Secretary of State for Transport, the hon. Member for Lewes. In fact, we have heard many warm words on fares. Scores of coalition MPs have been telling their local papers that they opposed the rise in fares, despite voting for them in this House. They will be glad to have the opportunity to set the record straight, and I trust that all those hon. Members will join us in the Lobby today.
Dr Huppert
The shadow Secretary of State also suggested on several occasions that we had voted for RPI plus 3%, but I do not recall doing so. Can the hon. Lady point to the dates of the Divisions in which any hon. Member specifically voted for RPI plus 3%?
Lilian Greenwood
The hon. Gentleman will find that we have had previous debates on transport and the cost of living when he had an opportunity to vote for our proposals, which would have reduced the increase in fares.
Lilian Greenwood
Not at the moment.
We have heard many warm words on fares and coalition Members have been supportive of the Government’s position. We have been promised an end to “inflation busting fares” in a press release from the Department for Transport, and both Liberal Democrats and Conservatives promised “fair pricing for rail travel” in the coalition agreement. For all those fine words, what has been delivered? Fares will rise by 3% above inflation, flex will be reinstated, and there will be overall rises of up to 11%. The hon. Member for Cambridge (Dr Huppert) likes to pretend that that is nothing to do with his party, but it is his Ministers, including the Under-Secretary, who are imposing these measures.
The new franchises also hand operators unprecedented license over the quantity and quality of the services that they run. Ministers must mind the gap between rhetoric and reality. For too many passengers the reality of rail travel is overcrowded carriages, repeated delays and needlessly complicated pricing structures. Instead of tackling the root causes of waste in the railways, the Government are merely handing the cost on to passengers. We are keen to see a more efficient rail industry, but passengers face unaffordable fare rises now. There have been enough empty pledges from this Government. Their words are cheap, but the fares are dear, and the rail companies count the profits. There has to be another way.
Less than a month ago, the former Transport Secretary, now Secretary of State for International Development, said that she wanted to find a means of bringing
“fares down to something affordable.”
This motion offers just such a means. I hope that the new Transport Secretary will be prepared to stand up against vested interests for the public good, and I hope that Members from all parties will support this motion to help ease the burden on rail passengers.