Railways Bill

Lord Reay Excerpts

Committee stage
Thursday 10th September 2026 Grand Committee

[Baroness Pidgeon (LD)]

My Lords, the amendments in this group are about strengthening the requirements for Great British Railways before it is able to grant a licence and to strengthen the Passengers’ Council in areas such as safety and standards. They would also strengthen the role of the Office of Rail and Road, which is something I believe is on this Government’s agenda.

The concerns of the noble Lord, Lord Evans, about consultation-only powers, rather than real teeth, for the Passengers’ Council, and the query from the noble Lord, Lord Lansley, about ensuring that Scottish and Welsh Ministers are consulted on a licence, are both very relevant, and I look forward to the Minister’s clarification on these issues.

[Lord Reay (Con)]

My Lords, I thank my noble friends Lord Evans of Guisborough, Lord Lansley and Lord Grayling for their amendments in this group. I will address Amendments 41, 42 and 44 first.

The Government have repeatedly emphasised the importance of independent regulation under the new system. They tell us that the ORR will remain an independent and expert regulator, while describing the new Passengers’ Council as a powerful new voice for passengers. These amendments ask how much power these bodies will actually have. Under the Bill, the Secretary of State may modify GBR’s licence after consulting the ORR and, where the changes concern its functions, the Passengers’ Council.

However, consultation is not agreement. The licence is fundamental to how GBR operates and to the conditions against which the ORR will ultimately regulate and enforce its performance. If the ORR is to be the robust and independent regulator that the Government say it will be, why can the Secretary of State alter that licence without its agreement?

The same question applies to the Passengers’ Council. The Government describe it as a powerful new voice, but the Bill requires only consultation. There is no express requirement in this provision for the Secretary of State to have regard to the council’s consultation response. The Secretary of State must subsequently consider representations or objections made during the formal notice period, but that is not the same as giving the passenger watchdog a meaningful role in agreeing changes that may directly affect passenger interests.

I turn to Amendment 46, tabled by my noble friend Lord Grayling. Under the Bill, the ORR may grant a licence to a non-GBR operator only if the Secretary of State consents or if the licence falls within a general authority previously given by the Secretary of State. As my noble friend Lord Harper asks, why is that ministerial veto necessary? If the ORR—the independent regulator that the Government repeatedly tell us will remain robust and expert—has considered an application and concluded that a non-GBR operator satisfies the relevant requirements, why should the Secretary of State have the final trump card?

If the Government genuinely want an independent regulator and less day-to-day political interference in the operation of the railway, surely licensing decisions of this kind should rest with the regulator. I would therefore be grateful if the Minister could explain in what circumstances the Government envisage the Secretary of State refusing consent to a licence that the ORR considers should be granted and why that power remains necessary.

Amendment 45, tabled by my noble friend Lord Lansley, seems entirely reasonable. Where a GBR licence concerns railway assets located in Scotland or Wales, I see no good reason why the relevant Scottish or Welsh Ministers should not be consulted.

[Lord Hendy of Richmond Hill (Lab)]

My Lords, I am grateful to hear from noble Lords on this group, and it is a special pleasure to hear from the noble Lord, Lord Reay.

Amendments 38 and 39 would undermine one of the fundamental principles that the Bill seeks to establish. The Secretary of State will set the overall strategic direction for GBR, and the Bill provides her with the sole ability to issue GBR’s licence. This reflects that it is the Secretary of State, not the ORR or the passenger watchdog, who is ultimately accountable for GBR both to Parliament and to the wider public. This aligns with the wider programme of regulatory reform that this Government are undertaking, where Ministers set the strategic direction and regulators are empowered to enforce against that. Regulators should not be making key strategic or political decisions for fundamentally important sectors.

However, regardless of who issues the licence, the ORR will enforce GBR’s compliance with it exactly as it does today. It has strong enforcement powers to ensure that GBR does not contravene the terms of its licence, including mandatory, legally binding directions requiring GBR to change its behaviour. It would not be appropriate to provide the ORR or the passenger watchdog with the power to veto the licence. The Secretary of State will, however, consult both those bodies and consider their views before issuing the licence.

On Amendment 38 specifically, I reassure noble Lords that safety remains fundamental to the operation of our railways and that the Bill does not weaken or alter the existing railway safety regime, nor the ORR’s role within it. No licence will be issued that is not fully compliant with safety regulations and safety law. Furthermore, we expect that GBR will have a licence condition to support the continuity of the current industry safety and standards framework to preserve our world-leading culture of rail safety. The Secretary of State will consult the ORR on the licence precisely to ensure that these kinds of conditions are fit for purpose.

I turn to Amendments 41 to 46. Currently, the Secretary of State is the ultimate licensing authority for the railways under the Railways Act 1993, and the current Bill does not change that. As it does now, the ORR will continue to issue all non-GBR licences under the general authority given to it by the Secretary of State. Not only would removing the Secretary of State from the process or requiring the ORR to consent undermine continuity and stability for the industry but it would be superfluous in practice, as the ORR already issues these licences on behalf of the Secretary of State.

Let me also clarify that railway licensing is, and will remain, a reserved matter. Scottish and Welsh Ministers are not licensing authorities under the current system, and the Bill will not change this. However, that does not mean that Scottish and Welsh Ministers are prevented from making their views known. The ORR is required under the Bill to provide notice prior to any licence being issued and to consider any representations, including any by Scottish and Welsh Ministers. We therefore do not consider it necessary to create an additional consultation requirement specifically for Scottish and Welsh Ministers.

I also note that the Government have spent long and productive hours discussing the provisions of the Bill with Scottish and Welsh Ministers and, in both cases, they are content with the licensing provisions as drafted. In fact, Scotland has already published its legislative consent Motion. I therefore ask noble Lords not to press their amendments.