Oral Answers to Questions

Theresa Villiers Excerpts

Thursday 23rd February 2012 Commons Chamber

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

2. How her Department will calculate the level of rail fares for services between Scotland and England in January (a) 2013 and (b) 2014.

[The Minister of State, Department for Transport (Mrs Theresa Villiers)]

The cap on regulated fares is calculated according to the formulae in franchise agreements. The current planning assumption, as set out in the 2010 spending review, is that the cap will increase by RPI plus 3% in January 2013 and in January 2014 for operators franchised by the Department for Transport. However, no final decision has been made.

[Mark Lazarowicz]

It is good to see the Minister in her place today, and I am sure that the whole House wishes her a speedy and full recovery from her accident.

As well as the RPI plus 3% increase proposed by the Government here, the Scottish Government are proposing RPI plus 3% increases in rail fares in Scotland and the potential removal of sleeper services and of cross-border services north of Edinburgh, so my constituents and many people in Scotland face a double whammy. How can we expect people to continue to move on to the railways when we are putting such obstacles in their way?

[Mrs Villiers]

The hon. Gentleman raises very important issues, and the concerns that he expresses are one reason the Chancellor secured the funding to ensure that the 2012 increase would be just RPI plus 1%. We recognise, however, that it is vital that we get the cost of running the railways down, because that is the long-term, sustainable way to respond to passengers’ concerns about the level of fares.

[Maria Eagle (Garston and Halewood) (Lab)]

I, too, welcome the right hon. Lady back to her place.

Last month The Daily Telegraph was briefed that future fare rises are “not set in stone” and are “under constant review.” Will the Minister of State therefore tell the House whether she still intends to allow train companies to hike fares by as much as 8% above inflation in 2013 and in 2014, and has she taken any decisions about fare rises in the years after that?

[Mrs Villiers]

As I said in my opening answer on this question, the current assumption is based on RPI plus 3%, but we will keep those matters under review, as we did in relation to 2012, to see whether further funding can be secured to opt for a different approach. In reality, however, it is crucial that we get the costs of running the railways down—costs that spiralled during the Labour Government. They failed to respond to the problem and were severely criticised by their own Labour-dominated Select Committee at the time for not doing anything serious about rail fares. We are going to get the cost of the railways down so that we get better value for money for passengers.

[Maria Eagle]

The Minister seems to be saying one thing to the train companies and another to passengers. I have with me the invitation to tender for the west coast main line, which promises bidders that they can increase fares by up to 8% above inflation next year, by up to 8% above inflation the year after that and, then, by up to 6% above inflation every year for the rest of the entire 15-year franchise. So it seems that the decision has been taken. When is the Minister of State going to stand up to those vested interests and stand up for passengers?

[Mrs Villiers]

The shadow Secretary of State has resorted to the same old stuff about the fares basket flexibility that the leader of her party got completely wrong at Prime Minister’s questions. It was a fares basket flexibility that Labour suspended for one year and we introduced, and the Labour Administration in Cardiff are still using that flexibility. It is entirely disingenuous for the shadow Secretary of State to get up and talk about—

[Mr Speaker]

Order. We do not use the word “disingenuous” in the Chamber, and I am sure that the Minister of State is happy to withdraw it. We are extremely grateful for her answer.

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[Anas Sarwar (Glasgow Central) (Lab)]

6. What assessment she has made of the effect on services to Scotland of the bid by International Airlines Group to acquire BMI.

[The Minister of State, Department for Transport (Mrs Theresa Villiers)]

The Department has made no such assessment. The proposed sale is a commercial matter between BMI’s owner and the prospective purchaser. Any competition issues arising from the proposed sale will be subject to the appropriate EU and UK competition authorities.

[Anas Sarwar]

BMI’s withdrawal of its flights from Heathrow to Glasgow last year left British Airways as the sole operator. Since then, average fares have increased by 34% and the number of flights on the route has decreased by 50%, affecting 1.8 million passengers and more than 300,000 small and medium-sized enterprises. What steps will the Minister take to ensure that Scottish businesses and the wider public are given access to a much more open, fair and competitive market?

[Mrs Villiers]

It is difficult for me, as a Minister, to comment on the specific deal, as that is a matter for the competition authorities. It is worth bearing in mind that Aberdeen, Edinburgh and Glasgow have 60,000 such flights a year, so there is excellent connectivity as things stand. It is important that in our discussions with the European Commission on its airports package we ensure that it is aware of the importance of regional connectivity. We will look into that in our aviation framework document. Our plans for High Speed 2 will deliver a three and a half hour journey time between Scottish destinations and London, which will provide an attractive alternative to aviation.

[Andrew Bridgen (North West Leicestershire) (Con)]

BMI’s headquarters is at Castle Donington in my constituency. Many of my constituents are very concerned about their employment prospects at the company. Will my right hon. Friend update the House on the progress of the proposed takeover by International Airlines Group?

[Mrs Villiers]

My understanding is that the directorate-general for competition at the European Commission has been informed, and that the Office of Fair Trading is in contact with the parties and the Commission on the proposed sale.

[Michael Connarty (Linlithgow and East Falkirk) (Lab)]

That was a very feeble answer from the Minister of State. Does she realise what British Airways is doing at the moment? To give an example, a 9.15 pm flight that I was supposed to take left at 10.36, after two other flights to City airport had been cancelled. It arrived after the Heathrow Express had left and I got home at 1.15 in the morning. That is what BA is doing now. This is not a question of competition. I want the Minister to tell the EU that it is not acceptable to the people of Scotland for BA to take over the BMI franchise. It will do what it is doing now and destroy the service from Edinburgh to this city.

[Mrs Villiers]

It is not the role of Ministers to make decisions on these deals. There are legal rules that put in place the role of independent competition authorities in deciding these questions. Of course the Government take seriously the importance of regional connectivity. That is one reason for our pressing ahead with HS2 and our Y-shaped network to Leeds and Manchester, which will deliver a three and a half hour journey time to Scotland, providing an excellent addition to current connectivity.

[Ian Swales (Redcar) (LD)]

7. What plans she has to ensure the rail network serving ports can carry modern freight containers.

[The Minister of State, Department for Transport (Mrs Theresa Villiers)]

Our policy is to continue to develop the strategic freight network to drive UK economic growth and support the expansion of our maritime trade.

[Ian Swales]

I welcome the public investment to upgrade the rail connection from Teesport to the east coast main line by the end of this year. However, there is still no suitable east-west rail crossing for modern containers anywhere between the midlands and Scotland. Will the Minister also address that problem?

[Mrs Villiers]

The Government have a major programme of improving the capacity of our rail network to take freight, particularly the 9 feet 6 inches high cube containers that are such an important a part of international trade. That is why the railway control period up to 2014 will see about £350 million spent on upgrading the network. A crucial part of that is improving links to ports, for example between Southampton and the west coast line and on the Felixstowe-Nuneaton line. That will provide major benefits on carbon emissions, road safety and relieving congestion on our roads.

[Mrs Louise Ellman (Liverpool, Riverside) (Lab/Co-op)]

What actions is the Minister taking to improve access to ports outside the south-east?

[Mrs Villiers]

The hon. Lady will have heard of the proposals being taken forward to improve gauge clearance to Teesport, and we are working on a number of other schemes and projects to improve rail freight connectivity with our major ports. Despite the deficit and the pressing need to reduce spending, our work on the strategic freight network has continued, and we propose to continue it in future.

[Iain Stewart (Milton Keynes South) (Con)]

Has my right hon. Friend had an opportunity to quantify what extra capacity there will be for freight transport on the classic rail network following High Speed 2?

[Mrs Villiers]

HS2 has done some major studies on that. I do not have the numbers in front of me, but it is clear that one of the major benefits of HS2 will be to free up paths on the existing north-south network for freight, and indeed for other passenger services, relieving the current congestion problems.

--- Later in debate ---

[Elizabeth Truss (South West Norfolk) (Con)]

In order to upgrade the service to half-hourly on the Fen line and the Norwich-Cambridge line, there needs to be an upgrade at the Ely North junction. Network Rail has conducted an economic study that suggests that this will have a positive benefit, and the Department for Transport wants to specify it in the next franchise. May I ask what progress has been made to move forward on this investment?

[The Minister of State, Department for Transport (Mrs Theresa Villiers)]

I know that my hon. Friend is a strong campaigner for improvements to the rail lines that serve her constituency. This is something that we are looking at carefully. We have asked Network Rail to do important work on deciding how we might improve the frequency of the services in the way that she wishes to see, and whether the infrastructure needed to deliver that is within the budgets that have already been allocated to Network Rail. We will also look at what we might be able to do in the next control period, as part of our high-level output specification—HLOS—statement, which we will publish in the summer.

[Jonathan Ashworth (Leicester South) (Lab)]

Will the Minister update the House on the Department’s attitude the electrification of the midland main line? There is widespread concern that, because of HS2 and other pressures, the electrification will not go ahead for quite some time. It would, however, provide a huge boost to the east midlands economy and to cities such as Leicester.

[Mrs Villiers]

Leicester and the communities around it have been running a very good campaign on this issue. The Government have made it clear that we see the progressive electrification of the rail network as an important part of our transport and environmental policy. The electrification of the midland main line has been prioritised by the industry in its initial industry plan, which will form an important part of the decisions that we have to make on what will be funded in the next railway control period. We will give further details in our HLOS statement in July.

[Mr John Leech (Manchester, Withington) (LD)]

Given the recent disappointing Christmas drink-drive statistics, is it now time to revisit the decision not to accept the North review’s recommendation to reduce the drink-drive limit?