Railways Bill (Fifth sitting)

Olly Glover Excerpts

Tuesday 27th January 2026 Public Bill Committees

[Jerome Mayhew]

It is not a perfect analogy, because GBR is at least intended to be more akin to a business—a nationalised business—but my hon. Friend is entirely right that where we have two organisations in competition, each one thinking that it runs the railways, that is a recipe for confusion at the least, and disaster at the worst.

This is not an idle concern, because it has happened before. We all remember the Virgin West Coast franchise debacle in 2012, when the slightly arm’s length process of franchising did not go well, causing a communal panic in the Department for Transport. The phrase, “Something must be done to prevent this from ever happening again,” was no doubt repeated many times. The result was that more and more micromanaging took place by the Department for Transport in the setting of franchises. The Department no longer talked only about outcomes that needed to be achieved, leaving how companies went about that entirely up to them, which is the appropriate way to draft a franchise agreement. Instead, that devolved into mechanisms of how a franchise should be operated.

We had that mission creep, and I fear that under the Bill we might get exactly the same approach with GBR. It will be set up with the best of intentions, and perhaps in the first two or three years all will run smoothly and the directing mind in practice might well be GBR, but then something will happen, because something always does happen in the real world, with lots of people doing their best but sometimes making mistakes, and there will be a collective gasp from the Department of Transport, because it will feel like it is on the hook, so “Something must be done to ensure that this doesn’t happen again.” We have designed into this mechanism a structure that allows the removal of GBR’s operational independence, and it does so without any reference to actions of last resort by the Government—the Bill is silent on that.

We talk about the Secretary of State, but we all know that officials in the Department for Transport will be advising the Secretary of State on what he or she should be doing in a particular circumstance, and there will be a power grab. Without amendment, the clause will absolutely allow for that. We should be alive to the real-world experience that we all have and take this opportunity to strengthen its wording in order to design out that issue and ensure that there is proper accountability—with GBR accountable to the Secretary of State and, through the Secretary of State, to Parliament—and that operational independence stays with what will be a nationalised business, rather than creating a railway version of NHS England, as my hon. Friend the Member for Isle of Wight East mentioned a moment ago.

I have tabled two amendments to address this issue. Amendment 12 would limit directions to circumstances in which the Office of Rail and Road assesses GBR to be in breach of its statutory functions. It could be argued that the Secretary of State should have an emergency lever; that is fair enough, because bad things happen. One of our great complaints before the election, although I am beginning to hear it from Labour Ministers as well, was, “We pull the levers but they’re not attached to anything—we have no power.” When we form the Government after the next election, we will want to have levers that are attached to something, and I accept that it is necessary to have an emergency lever to pull should a significant unforeseen event occur—another pandemic, perhaps—and an intervention be required.

However, amendment 12 would still allow the Secretary of State to intervene in emergency scenarios, as the ORR would deem that such events make it impossible for GBR to conform to its business plan targets. Clause 74 sets out the ORR’s power to monitor GBR’s performance. Elsewhere in the Bill, we shall argue that the ORR needs more teeth to hold GBR to account, and this provision limiting the potential for the Secretary of State to intervene until such time that an independent regulatory body has recognised that GBR has not been able to fulfil its functions will be an important safeguard.

Amendment 11 would put the words “last resort” on the face of the Bill, and would provide that a direction may be made only after the removal of GBR’s chief executive officer. The intention behind the amendment is to treat GBR as a business, which I think we all agree is what it is intended to be—albeit a nationalised one. Where there is a board of non-executive directors, they can question the executive team, and they can challenge decisions and require the chief executive to explain and defend the direction of the company. However, when push comes to shove, and the decision is made that the organisation is moving in the wrong direction, the weapon available to the chairman is the removal of the chief executive officer.

If GBR is operating on a day-to-day basis with oversight from the Department for Transport—the Secretary of State—and concerns arise as to its direction or performance, the sequence of severity of the response should not start with guidance from the Secretary of State and then mandatory directions. They might be the final requirement, because we all need those levers, but surely they should come only after the chief executive has been challenged and then removed, just as in the private sector with an arm’s length majority investment.

[Olly Glover (Didcot and Wantage) (LD)]

I certainly see what the hon. Member is trying to do with these amendments, and the Liberal Democrats share some of his concerns about the balance between holding GBR to account and GBR’s autonomy. However, does he not feel that amendment 11 may go a little too far? Laudable though the KPIs that he has set out are, I am not sure that any railway in this country has ever achieved them all at once, and if the amendment were made we may very well go through a revolving door of chief executives before the Secretary of State can give any direction.

[Jerome Mayhew]

That is a perfectly fair challenge, but amendment 11 would not require the CEO’s removal by the Secretary of State if those KPIs are not met; it would be a necessary first step to demonstrate that the KPIs are not being met, and then there would be a discretion. I suppose the hon. Member is really arguing that my safeguard is not quite as strong as it could be. Nevertheless, it would be a step in the right direction, and it would not require the removal of the chief executive.

New clause 4 would give the Secretary of State the power to dismiss the CEO of GBR on the grounds that a KPI has not been met and—this is an important bit, which the hon. Member for Didcot and Wantage might recognise gives the new clause some weight—GBR has failed to act on guidance that has been issued by the Secretary of State under clause 9. It is sequential. First, the chief executive is given guidance from the Secretary of State. Most chief executives worth their salt would take notice of official guidance given by their 100% shareholder, but if for some reason they fail to act on the guidance and they are still missing their KPI, then the power to dismiss would be exercisable. In my submission, that is a good approach.

Clause 7(2)—the “interference clause”—anticipates minor direction changes, which is exactly the kind of direction that should not be issued and is contrary to the explanatory notes. We are told that the powers in the clause will be used only as a last resort, but subsection (2) states:

“A direction under this section may provide, in particular, that a function is only to be exercised—

(a) after consulting the Secretary of State, or

(b) with the Secretary of State’s consent.”

The clause is not an emergency lever. It is quite clear from the drafting that the circumstances in subsection (2) cannot apply to a last-resort emergency lever. It is saying, “You can carry on doing things, but we need to have oversight in the nitty-gritty.” It is truly an interference clause.

Is it the Government’s intention that directions issued under clause 7 will be, as described in the explanatory notes, used as a “last resort” emergency brake, or do they intend—this is the case as the Bill is drafted—that the Secretary of State will give himself or herself the power to intervene in day-to-day management, even down to the level that individual decisions will not be taken until there has been consultation with the Secretary of State or the Secretary of State has consented to them?

Clause 7(5) needs improvement. It requires publication by the Secretary of State, but anticipates no role for Parliament in that oversight. The organisation Rail Forum said:

“We agree that this is desirable to ensure GBR remains arm’s length and is allowed to manage its own affairs.”

That is important. The industry itself is saying that GBR needs to be operationally independent and to manage its own affairs. Amendment 14 would correct that issue. It would require the Secretary of State to lay any decision before Parliament—the right place for primary scrutiny. Rail Forum supports the amendment. It says:

“This is essential to ensure that normal Parliamentary process is not bypassed.”

Amendment 16 would mean that decisions on fares imposed on GBR by the Secretary of State can be assessed against passenger growth and affordability. Such a direction would have a huge impact on the financial position of GBR, because decisions on fares and passenger growth and affordability are central to revenue. It is crucial that decisions are made on proper evidence and in line with the objects of GBR.

--- Later in debate ---

Guidance by Secretary of State

[Olly Glover]

I beg to move amendment 143, in clause 9, page 6, line 30, after “statutory functions” insert

“, but only in respect of strategic or financial matters where such guidance is necessary and does not interfere with the operational exercise of those functions.”

This amendment limits the guidance that the Secretary of State can give to Great British Railways.

[The Chair]

With this it will be convenient to discuss the following:

Amendment 19, in clause 9, page 6, line 30, at end insert—

“(1A) The Secretary of State may only give guidance under this section if—

(a) the Secretary of State has drawn to Great British Railway’s attention that Great British Railways is not meeting a key performance indicator set out in section [Great British Railways: Key Performance Indicators], and

(b) Great British Railways has not, in the opinion of the Secretary of State, taken action to remedy this failing within the period of two months.”

This amendment would restrict the Secretary of State’s ability to issue guidance to GBR to circumstances where GBR was failing to meet a key performance indicator as specified in NC2.

Amendment 20, in clause 9, page 6, line 37, at end insert—

“(5A) If the Secretary of State uses the powers in this section to give guidance to Great British Railways about the general level and structure of fares for travel on railway passengers services designated under section 25 or 26, then the Secretary of State must publish the assumptions, criteria, and objectives underpinning any guidance.”

This amendment puts a duty on the Secretary of State to publish the assumptions, criteria and objectives used when giving any guidance about the level or structure of fares, so decisions can be assessed against passenger growth and affordability.

Amendment 21, in clause 10, page 7, line 4, at end insert—

“(1A) The Secretary of State may only give guidance under this section if—

(a) Scottish Ministers have drawn to Great British Railways’ attention that Great British Railways is not meeting a key performance indicator set out in section [Great British Railways: Key Performance Indicators], and

(b) Great British Railways has not taken action to remedy this failing within the period of two months.”

This amendment would restrict Scottish Ministers’ ability to issue guidance to Great British Railways to circumstances where Great British Railways was failing to meet a key performance indicator as specified in NC2.

[Olly Glover]

It is a pleasure to serve under your chairship, Sir Alec. This amendment relates to some of the clauses in the Bill that will enable the Secretary of State to give guidance, as opposed to direction, to GBR. Amendment 143 is, in my humble opinion, a very modest and reasonable attempt to simply clarify some of the clear intentions that the Minister has expressed for the Bill. Our amendment would mean that the Secretary of State could only provide guidance to GBR on its statutory functions in respect of strategic or financial matters, where such guidance is necessary and does not interfere with the operational exercise of those functions.

The reason for tabling this amendment alludes to things I have said previously in this Committee room, and in other locations—there have been many examples in the past of the Secretary of State as proxy for the Department for Transport, getting involved in far too much of the fine detail of the running of our railways, whether that is the intricacies of timetable specification, whether certain types of rolling stock are upgraded or not, and whether they are equipped with wi-fi and tables, or not. There are many other examples that I could give and I have given before. The amendment is intended to strengthen the Government’s clear intent that the direction and guidance given by the Secretary of State should be strategic and high level. The guidance should be about providing a clear overview of what the Government of the day wishes the railway to achieve and deliver, and about empowering GBR—with appropriate regulation to hold it to account, as we have been debating—to get on with it.

I hope the Minister will view the amendment rather more favourably than he has others, although my powers of clairvoyance feel particularly strong this morning, and I suspect that will not be the case, in which case we will wish to press it to a vote.