East Coast Main Line

Debate between Mark Lazarowicz and Ian Mearns

Tuesday 12th November 2013 Westminster Hall

[Mark Lazarowicz]

My hon. Friend might be, but that is not the issue today. What we are talking about today is giving an alternative to the private sector. He just referred to other industries, and one of the issues about those industries is this: to what extent is there real competition?

One of the problems is that within the railway sector in the UK, a very limited number of UK companies are able and willing to put in a bid for a line. On the east coast and west coast lines, we all know that the major UK bidders will always be drawn from Virgin, First Group, National Express and possibly Stagecoach.

Of course, Virgin also runs planes to Edinburgh and Aberdeen, and First Group and the other companies operate other rail services. Some of them also operate bus and express coach services. So the issue is ensuring that there is at least some competition in the system, which the existence of Directly Operated Railways on the east coast main line would certainly provide.

[Ian Mearns]

rose—

[Mark Lazarowicz]

I will give way to my hon. Friend and then I will move on, to ensure that I make some progress.

[Ian Mearns]

It is ironic that, despite the number of Eurosceptics on the Government Benches, the Government are clearly in favour of state ownership—but Dutch, German and French state ownership of UK railways, not UK state ownership of UK railways.

[Mark Lazarowicz]

Indeed. However, my hon. Friend is being perhaps a bit too restrictive, because I understand that one of the companies shortlisted for one of the Scottish railway franchises is the mass transit railway system—MTR—in Hong Kong, which I presume is ultimately owned by the Chinese Government. It appears that although the Chinese are able to build our nuclear power stations and run our railways, the British state is unable to do so.

I come to the essence of the argument. The Government say that one of the reasons why the east coast line should go back into the private sector is the success that there has been since the railway system was privatised. One of the oldest logical fallacies in the book is to say that because event B followed event A, event B must have been caused by event A.

What the Government are saying, of course, is that because passenger numbers have gone up since the railways were privatised, that must be because they were privatised. However, the fact is that we have not been able to establish that link between the two. For example, I can look at the local bus company in Edinburgh, my home city, which is municipally owned. The number of bus passengers has gone up dramatically in the past 20 years. That company is in the public sector, but I will not say that the rise in passenger numbers is just because of that.

Equally, however, saying that the rail network’s being in the private sector is why the number of passengers has gone up seems a very weak argument. In fact, the number of passengers on other state-owned railways in other parts of the world has gone up as well. The argument about privatisation seems very weak.

As my hon. Friend the Member for Washington and Sunderland West pointed out, Lord Adonis, when Transport Secretary, made references to privatisation that are continually mentioned by the Government in defence of their policies. However, he has made it clear that he has learned from experience and is approaching this issue in a non-dogmatic fashion, in a way that the Government are signally failing to do.

Let us not forget that it was a Conservative Government who privatised the railways in the first place, against the wishes of the Labour party. Labour colleagues in Parliament at the time voted against that privatisation. Of course, the Labour Government after 1997 had a large number of priorities and I can certainly see why the issue was not, at that time, their No.1. However, as I have said, we are talking about the situation here and now. We have an opportunity to judge from experience and to ensure that the public get the best value for money and the best service, which, in my and my colleagues’ view, would be obtained by ensuring that the east coast line stays in the public sector.

Reference has been made to the way in which foreign companies are able to bid for the franchise. I will not develop that point any further, given that it has already been made by other colleagues. However, I will again make the point that there is a real issue about the lack of genuine competition within the rail franchising sector in the UK, including among British-based companies. Also, the point that my hon. Friend the Member for Easington (Grahame M. Morris) made about comparing rail with the utilities was very well made.

One of the points made by Ministers when they have argued why the east coast main line should go private again is that—as I think one of the Minister’s predecessors, the right hon. Member for Chelmsford (Mr Burns), said—the record of East Coast trains on punctuality had “plateaued”. Again, that is another example of desperation and of the Government trying to grab arguments to support a weak case.

The fact is that East Coast trains has a good record on punctuality. As we all know, the main reason why there have been problems with train punctuality in recent times is certain factors—first of all, the recent storms, which were clearly beyond anyone’s control. Above all, however, they have been due to problems with infrastructure, which have not been the fault of East Coast trains.

I asked a parliamentary question on the issue a while ago. I received an answer about the 2012-13 split in responsibility for delays on East Coast trains: 18% of them were due to East Coast itself, 13% were due to “Other Train/Freight Companies” and 69% were due to Network Rail. We know that one of the reasons why 69% of delays were due to Network Rail was problems with the overhead line system, which was, of course, put in place on the cheap, and for which—again—a previous Conservative Government clearly have to take responsibility.

My hon. Friend the Member for Washington and Sunderland West referred to the new targets from the regulator regarding punctuality. One of the things that the regulator said in its recent report was that there is a problem with reliability on the east coast main line, and I welcome the fact that it did. However, like my hon. Friend, I am concerned about how the performance measurements for the east coast service have been reduced by comparison with those for many other lines in the country.

I know that it only sounds like a marginal reduction if the performance target is reduced from 90% to 88%, but of course what we want to aim for is 100% reliability. Obviously, we will never get 100% reliability, but every time the target is reduced—even by 1% or 2%—we release the pressure on that operator to ensure that, as far as possible, all their trains arrive on time.

The fact is that the new target for cancelled or seriously late trains was set at a rate that would allow 4.2% of east coast line trains to arrive more than two hours late or not at all. That does not sound like much, until we put those figures in another context and say that one in every 24 trains could be cancelled without any penalties whatever being imposed on the operator responsible.

As my hon. Friend has said, there are concerns about the fact that that change was not referred to in draft proposals for the new punctuality performance targets; it was a change that people could not be consulted on. The Minister should give an explanation as to why that was the case. Bluntly, if he cannot provide one today, he should go away and look at the issue, because it was a major defect in the process.

It is time for the Government to drop their dogmatic approach to the east coast line and to give the public sector operator a chance. Let Directly Operated Railways put forward an alternative model and we will see what represents the best value for money and the best service for the public. Please, Minister, do not come forward with the argument that I heard from one Minister some time ago, which was, “We couldn’t do this because the law wouldn’t allow us to do it, and we had to put it out to the private sector.”

As a Back Bencher, I cannot speak for those on the Labour Front Bench, but were the Government to come forward and say, “Yes, we will change the law to allow East Coast trains to continue to operate the franchise,” I cannot think that my party would oppose that. Perhaps the Minister will make that offer today. I am sure that my hon. Friend the Member for Nottingham South (Lilian Greenwood) would be happy to respond to that.

It is time for the Government to change their policy. It is not what the public want, what the staff want or what the communities want—and it is not in the best interests of the public purse, either.

Rising Cost of Transport

Debate between Mark Lazarowicz and Ian Mearns

Wednesday 9th January 2013 Commons Chamber

[Ian Mearns]

There is an awful lot about current fare structures that is desperately unfair, particularly for people on low wages and those trying to get jobs, and particularly in a region such as the north-east, where many have to travel to get work.

As the independent report stated in September, a railway company that was temporarily renationalised by the Government three years ago reported increased profits and an improvement in passenger satisfaction. DOR, which took over the running of the east coast line from National Express, said that its operating profit increased by 7% in the year to March to £7.1 million. Turnover for the year amounted to £665.8 million—an increase of £20 million—leaving a profit before tax and service payments to the Department of £195.7 million. That was an increase of £13 million. Putting that against the £240 million proposed investment in the east coast main line makes the amount look extremely modest indeed.

I have a great deal of respect for east coast main line as a franchise. I sympathise with its staff, who often work in difficult circumstances, dealing with the failures of creaking infrastructure and worn out rolling stock and equipment, yet an awful lot of what the travelling public have to put up with on the east coast main line could be avoided through some relatively modest investment, which would be entirely affordable given its profits.

[Mark Lazarowicz (Edinburgh North and Leith) (Lab/Co-op)]

My hon. Friend mentions the east coast main line staff, who do indeed provide a good service to passengers. I am sure that he, like me, frequently comes across people who are confused about whether they have the right ticket for a journey—a train might be late or they might get on the wrong train. The poor staff then have to deal with the problems that that creates. Is that not an example of the kind of complication that drives away passengers and often makes them go for higher fares rather than cheaper ones?

[Ian Mearns]

Indeed, and one criticism I would make of the last Government is that they did not sort out the complicated franchising system, which has left us with a complicated rail ownership programme across the country.

The Chancellor of the Exchequer proudly announced investment in infrastructure as a means to unlock growth. However, analysis by the Institute for Public Policy Research shows a biased picture. The think-tank examined the data, detailing the projects to be brought forward as part of the national infrastructure pipeline. Of the projects that were identified as benefiting a particular region and where public funding was involved, it found that London and the south-east accounted for 84% of planned spending, compared with 6% in the north. That equates to some £2,700 a head for each Londoner, which is more than the total for all the other regions combined, which includes £201 a head for Yorkshire and Humberside, £134 a head for the north-west and just a fiver for the north-east of England. My constituents do not believe those figures, but they are absolutely right. Why, if we get a meagre £5 of investment per head, should we pay extortionate rises in rail fares, which have risen nearly three times faster than wages since the recession? In fact, between 2008 and 2012, average rail fares increased by 26.6%, with wages rising by just 9.6% over the same period. Recent research by the think-tank Transport for Quality of Life has shown that UK rail fares are the most expensive in Europe and that rail privatisation is costing taxpayers £1.2 billion a year, with train operating companies making large profits on the back of public subsidies.

Speaking of profits, I was appalled to learn recently of a dispute over pay involving east coast main line and a subsidiary company called ISS—International Service System—which centred on its cleaning staff. Cleaners were being paid £6.08 an hour—a figure that is below the national minimum wage and is, I believe, illegal. On top of that, they got no pension scheme, no enhancements for unsocial hours, bank holidays or weekends, no sick pay above the statutory minimum and no travel allowances. The east coast franchise, which likes to promote itself as a first-class service, was treating employees of its contract cleaning company in a third-class way. ISS is a huge multinational company, with more than 500,000 employees worldwide, 43,000 of whom work in the United Kingdom. It is disgusting that it was able to do that to its hard-working employees. Indeed, following on from yesterday’s debate, this has a knock-on effect, as the Government have to fork out in-work benefits to many of these people to subsidise the industry.

Pressure must be put on Network Rail by the Government to ensure that north-east services get a fair allocation of resources. Connectivity, particularly by rail, is essential to the economic prospects of regions such as the north-east. Despite their stated commitment to reduce the deficit, the Government still find themselves, month after month, deepening the crisis yet further. When will they recognise the essential link between investment in growth, particularly in regions such as the north-east, and their prime aim of deficit reduction? The two are absolutely connected.

Welfare Reform (Disabled People and Carers)

Debate between Mark Lazarowicz and Ian Mearns

Tuesday 18th December 2012 Westminster Hall

[Ian Mearns]

I could not agree more. My local authority has shed about one third of its administrative staff. That prompts the question: how will a local authority with such a huge cut in its capacity to deliver for its people ever be able to come to terms with the demands that will be placed on it?

Another distressing topic at the moment for disabled people and their carers and families is, of course, the bedroom tax. The reduction in housing benefit for social housing tenants whose accommodation is deemed to be too large for their needs will disproportionately hit households with disabled people. Of the 670,000 people estimated by the DWP to be under-occupying accommodation in the social rented sector, two thirds of those affected may be disabled. Many organisations such as Carers UK believe, as do I, that the policy will have a detrimental impact on certain groups of carers and many disabled people. Some families may be unable to cover the shortfall and be forced to move.

[Mark Lazarowicz (Edinburgh North and Leith) (Lab/Co-op)]

Inclusion Scotland made the point to me that it is not only about financial costs. If the family of a disabled person moves away to get smaller accommodation—if it is available—they will lose support networks and contact with carers and families. If they have to move, due to the tax, they will lose those things, which they need to survive. I am sure that point has been made to many other hon. Members.