---

Sustainable Railways

The Committee's report ““Delivering a sustainable railway: a 30-year strategy for the railways?”” was published on 21 July 2008 and the Government published their response to it on 20 October. The White Paper considered in the report sets out the Government's general vision for the railways for the next 30 years, as well as their specific strategy for 2009-14, as set out in their high-level output statement. At new year 2008, Network Rail's overruns at Rugby, London Liverpool Street and Glasgow Shields junction left thousands of passengers stranded and became part of the Committee's consideration, together with the White Paper. The Committee took wide-ranging evidence from witnesses, including passenger representatives, transport groups, individuals, professional bodies, trade unions, statutory bodies, Network Rail, regional organisations and the then Under-Secretary of State for Transport, my hon. Friend the Member for Glasgow, South (Mr. Harris). We warmly welcomed the long-term strategy for growth—the first such strategy for many years—which anticipates doubling freight and passenger traffic from today's figures. We noted that the strategy did not address structural issues in relation to rail and we were concerned by some aspects of the White Paper, including a lack of vision in relation to the absence of plans for high-speed rail and electrification, and a lack of integration with regional policy and other transport modes. We were concerned, too, about the performance of Network Rail and we did not feel that capacity issues were sufficiently addressed. We made serious comments on the proposals for the future financing of rail and their implications for fares and franchises. Those debates are continuing. It is pleasing to note that, not only since our report, but since the Government response was published, a number of steps have been taken that meet our requests. I am pleased that the Government announced on 15 January that they were to establish a company, High Speed 2, to develop proposals for new high-speed lines from London to Scotland and to link the west midlands with Heathrow and Crossrail. They also announced plans for electrification. It would be helpful if we were told today what the position is on those two matters. Are we talking about proposals or feasibility studies, or about specific actions that are to be taken—and, if so, when? We raised serious issues about Network Rail's governance and its lack of cost control. The Office of Rail Regulation's report on the 2008 new year overruns concluded that Network Rail had been in breach of condition seven of its network licence and a record £14 million fine was imposed. A range of problems was identified relating to site and supply management, continuity of skills and communications. Public anger about what had happened was compounded when, shortly afterwards, Network Rail chiefs awarded themselves major bonuses, including a bonus of more than £300,000 for its chief executive. During our inquiry we received further evidence of an efficiency gap. Studies that had been undertaken found that when Network Rail is compared with other European companies, there is an efficiency gap in relation to both maintenance and renewals. The gap on maintenance amounts to £263 million per annum, and on renewals to £846 million per annum. Efficiency is important in cost control and in securing value for money. We are concerned that the Government rejected our call to look again at Network Rail's governance. That is strange and at odds with the decision subsequently taken by Network Rail members themselves, who have now commissioned a review of how Network Rail is run. At the time we wrote our report, Network Rail was in dispute with the ORR over its budget for the next control period. That matter has now been settled and the budget has been set at £28.5 billion. It is therefore particularly important that Network Rail secures value for money and that there is effective cost control. We want the Government to take a more active interest in how Network Rail operates. The report considered capacity in the rail service We welcomed the increased popularity of rail, but expressed concern that the 40 per cent. increase in patronage over the past decade had led to overcrowding and that, following the proposals in the White Paper, the problem was set to continue. The White Paper set out proposals to deal with capacity problems—1,300 extra carriages, platform lengthening, Thameslink and Crossrail for London and major upgrades at Birmingham New Street and Reading—but we did not feel that they would solve the problem. We felt that there would not be sufficient new rolling stock and noted with concern that most of the new carriages were destined for London and the south-east, making us wonder what was going to happen to the north. We were worried that feast and famine were set to remain in procurement, and about the absence of a commitment to addressing pinch points in the north, particularly the Manchester hub. We would like to know exactly what is being planned in relation to those areas. The Government subsequently announced that a number of carriages are to be brought forward, but we want to know exactly what is proposed in that regard, where they will go and how they will deal with congestion.