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Light Rail

: I agree with the hon. Gentleman. There is no doubt that where trams are used regeneration has occurred and, as in Manchester, areas have been developed and improved. Before considering what action should be taken to put light rail back on track, I want to look at the Manchester Metrolink scheme. As I said during my maiden speech in the House, the Rochdale-Oldham line was first proposed in 1987 and was expected to be completed and running by 1992, but we are still not there. Since their election in 1997 the Government had given every encouragement to the development of the Manchester Metrolink. Indeed, the Deputy Prime Minister, and then the Prime Minister, suggested that the passenger transport authority should submit all three schemes at once. However, that changed on 20 July 2004, when the Secretary of State effectively withdrew funding for the Metrolink scheme. Many hon. Members will be aware that that produced what has probably been the most successful all-party, all-community campaign in Greater Manchester, which resulted in the Secretary of State putting the £520 million back on the table in December 2004. I also understand that he has confirmed that the budget could be supplemented with additional local resources and with bidding under the transport innovation scheme. Since then, Greater Manchester passenger transport executive officers have worked hard with Department for Transport officials to produce a viable scheme. The transport plan was submitted in June 2005 and funding has been agreed for phase 1 and 2 renewals. The original plans have been reworked and a detailed assessment of the non-transport innovation fund and the transport innovation funding implications of phase 3 expansion is reaching a conclusion, which includes a new approach to procurement and risk sharing. I have no doubt that the plans for the Oldham-Rochdale loop line are sensible, and the costs stack up. For example, the heavy rail line currently has a £5 million annual subsidy which, if costed over 30 years, produces £150 million. The line needs urgent upgrading of track and signalling, some of which would not be needed if it were converted for light rail. That cost has been estimated at up to £60 million. Putting those two costs together would bridge the gap and make the line viable. I want to ask the Minister three questions. Is the Department for Transport committed to the three Manchester Metrolink lines? Does he accept that the scheme is now an integrated transport solution, which will require additional transport innovation fund resources, and is the Department committed to giving the authority those resources? Finally, when does he expect an announcement to be made on when the third phase can proceed? What can and should be done to get light rail back on track? Five things could improve the viability of light rail. First, the procurement method should change from design, build, run and maintain to splitting up the contract so that more companies and more people can be involved. Secondly, we should allow ROSCOs—rolling stock leasing companies—or similar operating companies to purchase and lease rolling stock, spreading the cost over the life of the tram rather than treating it, as we do currently, as an up-front cost. Thirdly, we can achieve economies of scale by commissioning two standard tram designs, low-front and high-front, and ordering enough of them to make it worth while. For example, Madrid recently ordered 70 Citadel 302 trams and got a 15.7 per cent. reduction, bringing down the cost of each tram to £1.4 million. That was a considerable saving.