Railways Bill (Twelfth sitting)

Debate between Laurence Turner and Rebecca Smith

Thursday 5th February 2026 Public Bill Committees

[Laurence Turner (Birmingham Northfield) (Lab)]

It is a pleasure to serve under your chairship, Mrs Hobhouse. As in previous sessions, I draw the Committee’s attention to my membership of Unite the union. I will speak briefly on the amendments. I welcome the opportunity to talk about an area of narrowly gauged interest of long-standing, although I hesitate to call it tunnel vision: schedule 4 and schedule 8 compensation for planned and unplanned disruption on the network.

The delay attribution scheme has remained essentially unchanged since privatisation, and the clause is a welcome opportunity to look again at how it works in practice. Attention has been drawn to the fact that, under the present system, approximately 400 people are employed across the rail industry to attribute delays to either operators or Network Rail. That sometimes happens in ways that defy any common-sense interpretation of good value for money, and there have been eye-catching examples of expensive lawyers gathering in a room to argue about whether a dead pheasant or a dead peacock was a small bird or a large one, for the purpose of the scheme. Depending upon that determination, the costs may be picked up by the taxpayer or by private operators, and I think we can all agree that that is nonsense.

I am glad that the Bill, as drafted, retains some degree of compensation scheme. My attention was drawn to the need for such measures recently in my constituency, where there has been a long-standing problem with road surface conditions, including what has become known, infamously, as “Northfield’s big pothole” under the railway bridge that connects Quarry Lane and Coleys Lane. Network Rail pointed out to me that a single bridge strike from a heavy goods vehicle would incur greater compensation costs for just one hour of disruption than the entire cost of resurfacing that stretch of road. Clearly, we need some degree of accountability in the system.

However, the amounts paid out through schedule 8 compensation, which is for unplanned disruption in particular, have been enormous. In theory, these schemes should be self-financing, but for all the attention that is paid to dividend payments and profits in the current railway system, the money that leaves the public part of the railway through these compensation schemes has in some years been in excess of those payments. There is a very good case for these changes.

I am not sure that amendment 85 is entirely necessary or desirable, on the basis that there may well be circumstances in which a private operator, whether freight or open access, is responsible for delays, for example if rolling stock had not been kept in the required condition. It is sensible for there to be some attribution in the system. As subsection (7) sets out, there is a right of appeal to the ORR. This is a sensible clause, and I am not sure that the amendments are necessary.

[Rebecca Smith]

Does the hon. Member not think our amendments could actually improve the system for GBR? We have talked, in this Committee and in the Select Committee sessions on the Bill, about the real gap in terms of the incentives for GBR to improve its services and improve itself. There is no reason why adding GBR as a body that would have to pay penalties and compensation would not introduce an incentive, in the same way we expect for operators, to ensure that the service provided on the taxpayers’ behalf and using taxpayers’ money is improved. At the end of the day, GBR is paying itself, but our amendments would at least give it an incentive to make sure that it does not need to pay compensation in the first place.

[Laurence Turner]

If I have understood the hon. Member’s point correctly, the key is openness and transparency. We need some degree of understanding that, if GBR itself is responsible for delays, that information should be recorded so that improvements can be made. I am not convinced that GBR paying money to itself in a legal or quasi-legal process is the best use of public resources.

That transparency is lacking under the current system. The Delay Attribution Board does not publish any records of its proceedings. Some months ago, I made a freedom of information request for the minutes of the board, and the response was that they were too commercially confidential to disclose. Given the vast amounts of public money that are spent through this process at the moment, I think that is a severe limitation of the current system. This is a real opportunity to do things better.

Railways Bill (Eleventh sitting)

Debate between Laurence Turner and Rebecca Smith

Thursday 5th February 2026 Public Bill Committees

[Laurence Turner (Birmingham Northfield) (Lab)]

I am thinking about the hon. Member’s arguments about clause 64(3). Does she not think that there may be circumstances where higher charges actually help to get private investment into the railways? For example, GBR could agree to fund infrastructure improvements in exchange for an operator paying higher access charges over an agreed period and, through that mechanism, recoup at least some of the costs of that welcome upgrade to the network.

[Rebecca Smith]

I can appreciate where the hon. Member is coming from. It sounds like a good idea; however, it could still be in the legislation directly, and the illustration he gave still leaves a huge number of questions about what happens if there is more than one user of that bit of infrastructure. Why should the private operator be the one that has to pay for the infrastructure? If anything, there is an issue, which I may come to, about the impact on fares, because ultimately, by the sound of it, GBR is going to have far fewer costs than other operators. In principle, I can see why the hon. Member made that point, but I think it is not clear enough at this stage.

Clause 64(8) allows a right of appeal, but only under judicial review-type provisions, which is no right at all. Any of us who has worked with anyone who ever wanted to get a judicial review knows that it is incredibly difficult. It is also incredibly expensive, so it is certainly not a level playing field.

The industry has rightly been outspoken on clause 64. In evidence to the Transport Committee, the Rail Freight Group stated:

“The Bill sets out the future framework for access charges for freight. In headline terms the charges will be calculated in a similar way to today (costs directly incurred by running the train) which we welcome. However, the Bill provides for extra costs to be levied on freight services

a. Through a mandatory reservation charge for capacity which is booked and then not used (for example, if a customer cancels a train due to poor weather) (Clause 64)

b. Through a general clause 64(3) which allows GBR discretion to charge more if ‘an efficient operator can pay it’. This is a very broad test and far wider than the test in current law ‘if the market can bear it’. This raises the prospect of far higher, and potentially uncapped charges being levied.

Increasing the costs of rail freight will simply make using rail too expensive for customers when compared to road freight, and will reverse modal shift and undermine growth. It is essential that the powers to charge more than the standard charge are strictly limited for GBR.”

The key point there is about reversing modal shift. On the one hand, the Government want to promote modal shift. Indeed, there is a scheme coming in— I mentioned it on Tuesday, but now I cannot remember its name—that will look at different types of transport, and one of the plans is to ensure modal shift. Anything that undermines that is potentially contradictory and a backwards step.

The Transport Committee also heard evidence from Nick Brooks of ALLRAIL, who said:

“I was just going to say something about privately owned investors and privately owned operators, specifically privately owned investors that want to invest in our sector rather than in other sectors—aviation, the road sector, or even completely different sectors. There is a certain risk. There is a commercial risk, of course, and ultimately they are looking for lower fixed costs and higher variable costs. The worry with GBR is this: who determines what the market can bear? Is GBR an independent entity, or not? I think the Bill says it should be GBR itself that determines that, if I am not mistaken.

It is a little bit like another conflict, or potential problem, with track access fees. Who decides the size of the track access fees? If you are a privately owned operator, is it your competitor—GBR—that decides your track access fees? That is a potential cause of worry.”

Lumo and Hull Trains also had similar concerns, which they raised in their written evidence to the Transport Committee:

“A transparent and proportionate charging regime will be critical to ensuring the financial sustainability and competitiveness of the railway. If GBR were able to set and revise access charges without independent oversight (as suggested by clause 64), it could create uncertainty and deter private investment. Independent regulation of charging is therefore vital to maintain investor confidence and ensure fairness between different operators. Open Access operators already make a substantial contribution to the upkeep of the network while receiving no public subsidy. The charges paid by Open Access are calculated independently by ORR to encourage investment, sweat the railway asset and deliver connectivity and the associated economic benefits. It also acts as an additional income stream to Network Rail. These arrangements demonstrate the sector’s willingness to invest and its commitment to supporting the network’s long-term health.

Ensuring that access charges remain proportionate and independently regulated will help reinforce the Government’s objective of crowding in private capital to support network growth. Confidence in a fair charging regime is essential for the continued profitability of private operators. Reinforcing a transparent and proportionate charging system will also help deliver the Government’s wider fiscal priorities by attracting and retaining private investment. By giving investors certainty that network costs are predictable and fairly allocated, the Bill can ensure that private operators continue to play a central role in funding innovation and expanding passenger capacity across the UK.”

Lumo and Hull Trains recommend:

“The updated charging regime must be developed in consultation with private stakeholders, appropriate for the markets being served and regulated with independent oversight from the ORR. This will sustain confidence in a fair and transparent access regime and ensure that private investment continues to play a central role in delivering a successful railway.”

Amendment 83 would prevent GBR from charging any sum it liked without notice. Instead, it would be required to follow the standard pricing structure set out in clause 64(2), based on actual costs incurred as a result of the activity. Does the Minister agree that any serious business case for private investment in our railways will need to have the certainty of fixed costs? How does the clause achieve anything other than the opposite?

Amendment 82 would remove the right of GBR to charge its competitors costs, basically at any time and without notice, on grounds that they have access to more money that they could pay. Instead, it would impose a duty on GBR to give other operators a minimum of 12 months’ notice of changes to the charging scheme, so at least they can react to the change and seek any appeal before the event rather than after it.

Speaking to amendments 82 and 83, the Rail Forum has said:

“We strongly support these amendment, access and other charges should be reasonable and operators should have sufficient warning of changes to be able to plan accordingly.”

The amendments are not just a nice idea being suggested from the Opposition Benches, but something that the industry would like to see as well.

Amendment 84 would provide that neither the Secretary of State nor Great British Railways can take any step to implement any part of the charging scheme until it has been laid before Parliament for three months. Once again, that would put accountability and transparency back into the system—something the Government seem hellbent on ignoring.

The second impact would be to allow affected organisations time to prepare an appeal. Judicial review requires a very short application process of just 12 weeks. This amended clause would help aggrieved parties to prepare a complex challenge in time for a JR timetable. Amendment 84 is more a probing one, so it will be interesting to hear the Minister’s response. The reflection on the judicial review process is particularly important, because we do not want to crowd people out of the opportunity to appeal. Anything he can offer in response would be appreciated.

Amendment 230 would ensure that services are not caught within the charging scheme if they cannot operate due to GBR failures or actions—a case of natural justice. Does the Minister accept that the existing wording of the clause would allow GBR to profit from a cancellation of services caused by GBR’s failure to provide infra-structure? If so, will he explain how that could be a fair result?

Amendment 242 would remove the requirement for GBR to charge in relation to trains that are planned to use GBR infrastructure, but do not operate or do not operate in full. Again, that is in effect a probing amendment, or a making-a-point amendment, as it were. With that, I shall sit down.

Railways Bill (Seventh sitting)

Debate between Laurence Turner and Rebecca Smith

Committee stage
Thursday 29th January 2026 Public Bill Committees

[Rebecca Smith]

I believe that the Mayor of London’s transport strategy is already considered within the wording of the Bill. I did not draft the Bill; it is not my Bill. I am just highlighting those areas. Ultimately, many of those areas may well be further down the road towards becoming mayoral authorities. I am talking about the areas that are not even on that path. We know that certain counties outside London are doing so, but ultimately the point the hon. Gentleman is making is a valid one. However, I do not believe that it means we should not have the amendment that we are putting forward, because it would give strategic authorities the ability to communicate with the Mayor of London and with GBR. That is an additional layer of engagement and ensuring that those voices are heard. I do not see how that would be contrary to what is going on in London.

I will briefly speak to the new clauses and then bring my comments to a close. It is worth looking at the rolling stock leasing framework, and I was interested in the comments made by the hon. Member for Didcot and Wantage about pursuing a leasing framework. At the end of the day, let us be real: the Government and the country at this point in time are not in a position simply to buy new rolling stock just because GBR comes into ownership. Forgive me if I am wrong—I am not an expert on this—but ultimately there will be some requirement to continue leasing. As much as it would be great to have brand-new trains that all look identical and all do the same thing, realistically we are just not in that position.

That leads me to one point that has come up in some of the evidence sessions I have sat in, which is accessibility. I know that a lot is being done to ensure that accessibility is central to the Bill and that people who need access to trains are considered. The hon. Member for Hyndburn raised this issue specifically for those outside the disabled community, including people of particular ages who have mobility needs. We heard from Lord Hendy that it could actually be decades before we see an improvement to accessibility because of the rolling stock. I believe that the amendments tabled by my hon. Friend the Member for Broadland and Fakenham would give due regard to putting some system in place to ensure that that those accessibility improvements are looked at strategically and on a rolling basis—so to speak. I believe that the amendments add something, given the argument for accessibility.

We have talked a lot about supply chain manufacturing, which amendment 36 is about. I appreciate the comments of the hon. Member for Derby South. Ultimately, we need to ensure that a long-term strategy is in place for our manufacturing sector. I have already mentioned the defence sector; we have a huge requirement for our advanced manufacturing at the moment and we need that certainty. We have seen the role that private sector investment plays in the development of rolling stock. That is not to say that the private sector is better than the public sector—I happen to believe that they are both important in the right proportions—but we have had so much investment from the private sector while the railway has been privatised. To just walk away from that on an ideological basis does not seem right.

[Laurence Turner]

Will the hon. Member give way?

[Rebecca Smith]

Bear with me one second. Ensuring that manufacturing process in the long term will be important. I will give way to the hon. Member, who is much more learned on this matter than me.

[Laurence Turner]

Much of the investment that has been channelled through the private sector since privatisation has in fact been underwritten by the state, and by Government guarantees. I will not put her on the spot to list specific examples but it would be helpful if Opposition Members could give examples of an at-risk capital investment that would actually be endangered by this Bill. I do not believe that such examples exist.

[Rebecca Smith]

The Committee heard from some representatives of the private sector. Lord Hendy has also highlighted that Hitachi—I believe it was—has made multi-million-pound investments that the Government were very happy to accept. It may well be that that is backed up by Government, but that was welcomed by the Prime Minister, so to say that we do not want private investment seems a bit churlish—ultimately, it has been accepted by the Government in its entirety.

The new clauses in this group are pushing the accountability piece: the reporting back, to make sure that the Great British public has the opportunity to see what Great British Railways is delivering and whether it is holding itself to account in the right way. I do not understand why the Government do not seem to think that the new clauses are a good idea. If Great British Railways will be so wonderful, would it not be great if the British people can see what it actually achieves and hold it to account? Marking one’s own homework is never good, and being able to hold GBR to account in all its forms will be essential.

Railways Bill (Sixth sitting)

Debate between Laurence Turner and Rebecca Smith

Committee stage
Tuesday 27th January 2026 Public Bill Committees

[Jerome Mayhew]

I agreed with the hon. Gentleman until that last sentence, because new clause 40, which I will come to in a moment, would require not the removal of subsidy but looking towards it—it is aspirational. It would set GBR’s sights on minimising its costs to the taxpayer, not through penny pinching if that would be the wrong decision, but through growth in its revenue by becoming efficient and doing more for less. Those are all good incentives that a private business inevitably has because of the challenge of competition.

New clause 39 would require Great British Railways to focus on other opportunities for funding and on minimising operational costs, just like any other business. The areas of focus under subsection (7) are the revenue opportunities.

New clause 40, on non-reliance on taxpayer funding, would make the direction of travel for GBR clearer. It may be—in fact it is almost certain—that it will never achieve it, but it is a noble objective. It should be clear that GBR should aspire to reduce the need for the taxpayer to support the rail sector by making it as efficient and attractive to passengers as possible, thereby attracting more passengers and freight on to the railways. That would create a virtuous circle, rather than the opposite. We should start thinking about that, which is what new clause 40 is intended to achieve.

New clause 41, also tabled in my name, would require Great British Railways to publish an annual statement of its financial performance. The new clause builds on the theme, forcing Great British Railways to focus on its financial performance and reduce its reliance on the taxpayer. It may be the skimmed-milk version of new clause 40 that the hon. Member for Birmingham Northfield might find more palatable.

It is important that we do everything we can to design into a nationalised structure, where there is no competitive tension, incentives for GBR naturally to seek to achieve efficiency and productivity enhancements. There is a very real need for that, because the taxpayer’s pound can only be spent once, and funds are needed in many areas of Government. Apart from anything else, we need to reduce the tax burden, which this Government have raised to the highest on record, so anything we can do to build a structure that incentivises GBR to reduce its dependence on the taxpayer is a good thing. It also forces public accountability.

Finally, new clause 44 would require the Secretary of State to give GBR an annual savings target. Taking all the new clauses together, the intention is to allow GBR to focus on providing genuine value for money for the taxpayer, not just in abstract terms, and to cut away some of the existing inefficiencies in the infrastructure commissioning and decommissioning process, to provide a longer period of certainty for the supply chain so that it can pass on the resultant efficiencies to the taxpayer. That money can be either reinvested in accelerated infrastructure roll-out, rather like the ability of ScotRail electrification to do more for less, or—heaven forbid—used to produce tax cuts for the hard-pressed taxpayer. I hope the Minister will be bowled over by those suggestions, and look forward to hearing his response.

[Rebecca Smith (South West Devon) (Con)]

It is an honour to speak with you in the Chair, Mr Western. I will touch on three of the new clauses—one at greater length than the others—to follow up on the words of my hon. Friend.

For me, new clause 39 highlights something that is clearly missing from the Bill: what actually happens when these currently franchised, privately run rail services come into public ownership across the board. Over many years, unions have fought hard for terms and conditions for staff and railway companies, but these are not uniform across the board. There is a huge differential in the terms and conditions that staff are subject to.

I pay huge tribute to the men and women who work on the railway; they are a brilliant group of people. I am obviously on a train every week, coming up and down from my constituency. However, it is really important that we have this conversation about what the Bill will actually mean. As my hon. Friend pointed out, value for money is mentioned only once in the Bill. We are, in effect, writing a blank check for GBR to spend whatever it wants on bringing all these staff into its employment.

We were told very clearly when the Committee began that this is not a civil service; it is the public sector, so there is a difference there, but it is effectively a private body as well. I would be interested to hear the Minister’s comments about how staff are being brought across—obviously some franchises have been brought into Government control already—and about the Department’s plans going forward, because time and again, we see pay going up for public sector workers without that necessarily reflecting any changes in performance.

[Laurence Turner]

The 1992 White Paper that preceded the Railways Act 1993 said that, at the time, British Rail had the second highest workforce productivity of any railway in Europe. What does the hon. Member think went wrong in all the years under privatisation that followed?

Railways Bill (First sitting)

Debate between Laurence Turner and Rebecca Smith

Committee stage
Tuesday 20th January 2026 Public Bill Committees

[Rebecca Smith]

Q But the responsibility for the delivery of services will be theirs. Going back to my original question about how we hold it to account, are you effectively saying that when it comes down to the individual railway lines and the services, we as MPs will be going to that chief exec and then having to figure out how we escalate it if that does not work?

Alex Hynes: Under the current system, if you want to talk about the delivery of rail services in your area, you have to talk to the relevant train operating company’s managing director and the relevant route director in Network Rail, because there is no one in charge.

These integrated business units are going to be the powerhouse of Great British Railways. We have created three of them already, albeit using a workaround within railway legislation. In Kent, on South Western and Greater Anglia, we have now appointed one person to run track and train to ensure that that person is making joined-up decisions in an integrated way, and in the best interests of passengers and taxpayers.

Also, as an accountability mechanism, it works incredibly well because there is nowhere else to go—that person is the directing mind for their chunk of the railway. Having done one of those jobs myself for seven years in Scotland, it is very effective as an accountability mechanism, and it enables much better decision making, as well as decision making that can be undertaken faster than in the current system, where we have many organisations involved in the running of the railway.

[Laurence Turner]

Q Good morning. I first have a couple of questions to Mr Larkinson, but if other witnesses wish to come in, please do so.

Mr Larkinson, in the ORR’s last annual report and accounts, it stated,

“we began engaging with infrastructure managers on how to reduce the administrative burdens we impose”—

in the context of the Bill and rail reform. I do not mean to suggest that “burdens”, as expressed here, are always entirely one-sided, or that the ORR is doing anything other than working within the framework that has been established for it. Can you tell us a bit about what these “burdens” are, and what potential benefits might accrue from their removal?

John Larkinson: That work comes from the Government’s overall review of regulators and the remit that they have given to all regulators to look very carefully at administrative burdens imposed on regulated companies. We are the regulator that that applies to. The target is to reduce the administrative burden by 25% by the end of this Parliament. We are working on that process as set out by the Government and have already put a whole section in our business plan about the work that we are going to do. On that basis, we have had conversations with the companies that we regulate, such as Network Rail, about areas where we might be imposing unnecessary administrative burden, which is something that is always good to come back and look at.

Interestingly, we have had different responses from the different companies that we regulate, including, “We do not see any massive excess of administrative burden.” In the case of Network Rail, we have already identified some areas, such as the amount of data we require and the way that data is transferred around us—areas where things can be made faster and less resource intensive. So yes, we are getting on with it and reporting back. Indeed, I was at the regulators council with the Secretary of State for Business and Trade and the Chancellor reporting back about a week and a half ago.